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Cole v. Bank of America

oklahoma

Oklahoma Supreme Court

COLE v. BANK OF AMERICA2022 OK 96Case Number: 118802Decided: 12/06/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. DANIEL ROBB COLE, Plaintiff/Appellant,v.BANK OF AMERICA, N.A., SHAPIRO & CEJDA, LLC, KIRK J. CEJDA, LESLI J. PETERSON and CARMEKA EDWARDS, Defendants/Appellees. ON WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION NO. III ¶0 Former homeowner, against whom foreclosure action was dismissed after he succeeded on appeal, brought suit against bank, his former adversary and its attorneys for malicious prosecution. The Honorable Don Andrews, District Judge, dismissed the claims for malicious prosecution and former homeowner appealed. The Court of Civil Appeals, Division III, affirmed. Certiorari was granted and the single issue before us is whether the original action was terminated in Appellant's favor. We hold that it was where (1) former homeowner succeeded on appeal in vacating judgment; (2) the law of the case established that foreclosure judgment against him was inherently defective; and (3) on remand, bank dismissed former homeowner from foreclosure action, then amended petition continuing the action against a different party. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS DIVISION III OPINION VACATED;DISTRICT COURT OF OKLAHOMA COUNTY JUDGMENTREVERSED AND REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Edward L. White, Kerry D. Green, EDWARD L. WHITE, P.C., Edmond, Oklahoma, andSherry Doyle, SHERRY DOYLE, P.L.L.C., Edmond, Oklahoma, for Plaintiff/Appellant, Joel W. Harmon, Melanie Wilson Rughani, CROWE & DUNLEVY, Oklahoma City, Oklahoma, for Defendant/Appellee, Bank of America, N.A., Jack S. Dawson, MILLER DOLLARHIDE, Oklahoma City, Oklahoma, for Defendants/Appellees, Shapiro & Cejda, LLC, Kirk J. Cejda and Lesli J. Peterson. Edmondson, J. FACTUAL AND PROCEDURAL BACKGROUND ¶1 Daniel Robb Cole, after a favorable appellate ruling vacating judgment against him, filed this action including claims for malicious prosecution action against Bank of America, N.A. (Bank) and its legal counsel, Shapiro & Cejda, LLC, Kirk J. Cejda, and Lesli J. Peterson (Attorneys). Cole alleged that Bank and Attorneys acted with malice and without probable cause when they filed a foreclosure action against him and obtained judgment for a loan modification agreement defendants knew he had not signed. The details of this prior foreclosure action or "original" action will be discussed later. ¶2 Cole alleged that not only was the prior foreclosure action spurious; but Bank intentionally or recklessly hid the fact of a subsequent loan modification by Cole's former wife, until after judgment was obtained against him. He further alleged that Bank and Attorneys made false and misleading statements in their summary judgment motion when they withheld their knowledge of the loan modification and provided only a copy of the original note which Cole and his former wife had signed. Cole pointed out that Bank and Attorneys repeatedly misled him as well as the trial court to believe that there was only a single operative note. Cole stated that he prevailed on appeal and the trial court was directed to vacate the judgment against him. On the same day the trial court vacated judgment, Bank filed a dismissal without prejudice stating that "said defendant not being a necessary party herein."1 Cole claimed he is entitled to recover compensatory damages to include attorney fees, time missed from work, damage to his credit score, as well as emotional distress and punitive damages. ¶3 Bank and Attorneys filed motions to dismiss the malicious prosecution claims asserting that Cole could not meet one of the threshold requirements of this tort, successful termination of the original action in his favor. Defendants argued because Bank filed a dismissal without prejudice as to Cole, there had not been a favorable termination as to him. Glasgow v. Fox, 1988 OK 71, 757 P.2d 836. Defendants argued that under Glasgow, no matter the circumstances, a dismissal without prejudice can never be treated as a favorable termination of the underlying controversy. Defendants did not deny Cole prevailed on appeal or that the Court of Civil Appeals described the judgment against Cole as "inherently defective." The trial court granted the Defendants' motions to dismiss the malicious prosecution action. Cole appealed. ¶4 The Court of Civil Appeals, Division III, affirmed and concluded that under Glasgow, Bank's "dismissal of the foreclosure action without prejudice was not a termination of that suit in Cole's favor which will support his action for malicious prosecution." We disagree. ¶5 Next, we examine the details of the original foreclosure action. Almost two years after Cole and his former wife divorced, she solely executed a loan modification agreement with Bank on the house the couple had previously purchased during marriage. Pursuant to the former couple's divorce decree, former wife was awarded this house together with all financial obligations. Although the original note was jointly signed by the married couple, Cole was not a party to this modified agreement. This agreement was between former wife and Bank. Prior to judgment against Cole, the modified note and its details were never disclosed to Cole or to the trial court. Bank and Attorneys mentioned only a single operative note and provided only a copy of the original note which had been executed by Cole. ¶6 Former wife defaulted on this modified loan. Bank sued to foreclose, naming Cole as a party. On summary judgment, Bank sought judgment against Cole, submitting the original note as evidence of the alleged debt owed by him. Bank was silent about the loan modification. The trial court granted judgment against Cole. ¶7 Cole filed a motion to vacate judgment arguing that it was not supported by the Bank's evidence and the terms recited in the judgment conflicted with the evidence. Cole noted that the interest rate and loan balance differed from that stated in the original loan. Cole suggested that a loan modification had likely been previously executed, and if so, he would not be liable on a modified note he did not sign. Cole also argued there were additional irregularities casting further doubt on the authenticity of Bank's evidence. More than two weeks after this motion was filed, Attorneys for the first time, revealed to Cole's counsel there was a loan modification which Cole did not sign. One month after Cole's motion, and without any payment having been made by him, Bank filed a partial release of judgment, releasing Cole as to any liability on the judgment. Three months after the motion was filed, Bank for the first time provided a copy of the loan modification to the trial court. Although Bank admitted that Cole had not signed this newly produced note, it argued there was no basis to vacate judgment. In fact, Bank suggested that somehow its own failure to disclose this modified note was actually the fault of Cole for failing to conduct discovery. Bank maintained that "Cole was a proper party to this action and properly named and served" and disputed that Cole could be harmed in any way by its actions. In fact, Bank boasted that "Plaintiff has gone above and beyond what it was legally obligated to in order to resolve the issues amicably without incurring additional attorney's fees and costs." Bank resisted all efforts of Cole to vacate judgment. Bank even continued to argue that Cole was liable under the original note, in spite of the fact that the actual note it sought to foreclose was the modified note. This specific legal issue was never at issue in any legal proceeding and it is undisputed that Bank was seeking to foreclose the modified note. The district court denied the motion to vacate. Cole appealed. ¶8 The Court of Civil Appeals reversed the judgment and directed the trial court to grant Cole's motion to vacate judgment. The appellate court also noted that under Goss v. Trinity Sav. & Loan Ass'n, 1991 OK 19, 813 P.2d 492, when a note signed by a single party is materially altered by a change in the interest rate, the note is extinguished. Although the appellate court was uncertain if Goss would apply to a two-party note that was later unilaterally altered, the court clearly outlined that in order to support judgment, Cole would have had to have authorized the modified note. It is undisputed, Cole did not sign the modification. The appellate court went on to discuss additional irregularities in the record, (1) the failure to swear to the accuracy of the copy of the note, and (2) failure to provide a certified copy of the note. But the court highlighted that even if the copy had been certified, it "was admittedly not a copy of the note sued on." The appellate court then found that the foreclosure action against Cole was inherently defective and that Bank failed to establish the required grounds to foreclose against him.2 The court also reviewed Cole's appeal of the trial court's denial of his motion for sanctions against Bank. The Court of Civil Appeals found insufficient evidence to support summary judgment against Cole. The appellate court reversed the trial court's refusal to vacate summary judgment and granted Cole's motion to vacate judgment. The court also vacated the trial court's judgment denying sanctions. Cole prevailed on all issues on appeal. ¶9 The trial court vacated the judgment against Cole on remand. On that same day Bank filed a dismissal without prejudice because "said defendant not being a necessary party herein."3 Bank did not dismiss the foreclosure action, but rather continued by filing an amended petition against the former wife arising out of her default under the modified note. She was the sole named defendant. Bank obtained judgment against former wife. STANDARD OF REVIEW ¶10 We review the trial court's grant of a motion to dismiss under a de novo standard. Wells v. Oklahoma Roofing and Sheet Metal, LLC, 2019 OK 45, ¶ 7, 457 P.3d 1020, 1024; see also, Wilson v. State ex re. State Election Bd., 2012 OK 2, 270 P.3d 155. Motions to dismiss are generally disfavored unless there are no facts consistent with the allegations under any cognizable legal theory. Id. We implement plenary, independent, and non-deferential examination of the rulings below. John v. St. Francis Hosp., 2017 OK 81, ¶ 8, 405 P.3d 681, 685. LEGAL ANALYSIS ¶11 One of the five elements a plaintiff must prove in a malicious prosecution action is a successful termination in plaintiff's favor in the original action. Neely v. First State Bank, 1998 OK 119, ¶ 8, 975 P.2d 435, 437.4 The sole issue before us is whether there is sufficient evidence that Cole can meet this one element, successful termination as to the prior foreclosure action. We apply a case-by-case determination as to whether the dismissal in the original action is a "successful termination" and shows the plaintiff to be without fault. Id. at ¶ 9, 975 P.2d at 437. Factors we consider in making this determination include whether substantive rights of the cause of action were previously determined and whether defendant was vindicated. Glasgow v. Fox, 1988 OK 71, ¶ 15, 757 P.2d 836, 839. ¶12 We previously considered in Glasgow whether a dismissal without prejudice of an entire action constitutes a "favorable termination" when such dismissal is based solely on procedural grounds, prior to submission of the case to the court or jury. We reasoned that under 12 O.S.1981 §683, such dismissal was not determinative of the substantive issues of the case; rather, it was a dismissal on procedural grounds without merit determination.5 Glasgow, at ¶ 14, 757 P.2d at 839. We discussed that because the underlying lawsuit could be reinstituted at a later time and found to have merit, this type of dismissal should not be used as a basis to initiate a malicious prosecution action. Following this analysis we concluded: Therefore, we hold that dismissal without prejudice of the underlying malpractice action was not a termination of the suit in appellant's favor which will support a claim for malicious prosecution. It did not reach the substantive rights of the cause of action and thereby vindicate appellant as to the underlying action. (Emphasis added) Id. at ¶ 15, 757 P.2d at 839. ¶13 Glasgow does not support the conclusion urged by Bank and Attorneys that a dismissal without prejudice is never a successful termination of a prior action in the context of a malicious prosecution claim. This surface analysis is legally flawed and ignores the following critical differences in the matter before us: 1) there was no dismissal of an action on procedural grounds under 12 O.S. § 683; 2) there was a determination on the merits by an appellate court as to the sufficiency of evidence to support the foreclosure judgment against Cole, no evidence that Cole authorized the modification, which would be required to hold him liable on the modification; 3) Cole was vindicated on appeal as the judgment against him was vacated. Further, Cole's dismissal as a party and the subsequent amended petition, effectively extinguished the claim against Cole as to the loan modification foreclosure action.6 At the time the dismissal was filed, Bank knew that Cole could not be held liable for a subsequent loan modification he did not authorize, and the only evidence produced established that Cole never signed or authorized the modification.7 CONCLUSION ¶14 We find Cole's dismissal in the prior foreclosure action was based on a decision on the merits, and it was not a dismissal on procedural grounds as in Glasgow. We further find that Cole was vindicated on every issue raised in the prior action. We therefore hold that the original action was terminated in favor of Cole where (1) Cole succeeded on appeal in vacating judgment; (2) the law of the case established that foreclosure judgment against him was inherently defective; and (3) on remand, Bank dismissed former homeowner from foreclosure action, then amended its petition continuing the action against a different party. The trial court dismissed the action as to the malicious prosecution claim solely on the basis of the termination issue. The opinion of the Court of Civil Appeals is vacated and the case is remanded to the trial court for further consideration of the other elements of this cause of action and for such other proceedings as are warranted. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVILAPPEALS DIVISION III OPINION VACATED;DISTRICT COURT OF OKLAHOMA COUNTY JUDGMENT REVERSED AND REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Darby, C.J., Kauger, Winchester, Edmondson, Combs, Gurich, and Kuehn, JJ., concur; Rowe, J., concurs in part, dissents in part; Kane, V.C.J. (by separate writing), dissents. FOOTNOTES 1 ROA, Doc. #1, Ex. F, Opinion, Ct. Civ. App. - Bank of America v. Daniel Robb Cole, et al., Case No. 116,943. 2 Id. 3 ROA, Doc. #35, Resp. of Def. Shapiro & Cejda, et al. to Pltf.'s Mot. to Reconsider, Ex. E - Dismissal w/o Prej., April 8, 2019. 4 "The plaintiff in a malicious prosecution action has the burden of affirmatively proving five elements: (1) the bringing of an original action by the defendant, (2) its successful termination in plaintiff's favor, (3) want of probable cause, (4) malice, and (5) damages." Glasgow, supra., citing Young v. First State Bank, 1981 OK 53, 628 P.2d 707. 5 12 O.S. 1981 §683 stated as follows: §683. Dismissal of action- Grounds and time An action may be dismissed, without prejudice to a future action: First, By the plaintiff, before the final submission of the case to the jury, or to the court, where the trial is by the court.Second, By the court, where the plaintiff fails to appear on the trial.Third, By the Court, for the want of necessary parties.Fourth, By the court, on the application of some of the defendants, where there are others whom the plaintiff fails to prosecute with diligence.Fifth, By the court, for disobedience by the plaintiff of an order concerning the proceedings in the action.Sixth, In all other cases, upon the trial of the action, the decision must be upon the merits. We discussed in Glasgow, that any dismissal falling within one of the first five listed categories is not determinative of the substantive issues within the case. The analysis of this statute in determining whether or not the dismissal was one that was procedural or upon the merits was central to our decision. 6 State ex rel. Simms v. Simmons, 1985 JUD 1, ¶ 6, 711 P.2d 949, 952 (an amended petition constitutes an abandonment of the original petition and prior averments that are not part of the amended pleading). 7 ROA, Doc. #1, Ex. F, Opinion, Ct. Civ. App. - Bank of America v. Daniel Robb Cole, et al., Case No. 116,943. Kane, V.C.J., dissenting: ¶1 Before today, the law in Oklahoma was clear that a voluntary dismissal without prejudice was not an adjudication on the merits for purposes of subsequent malicious prosecution litigation. The Court of Civil Appeals had earlier correctly focused on the fact that the true termination of the prior foreclosure litigation was just such a voluntary dismissal by the foreclosure plaintiff. ¶2 The majority today holds that the dismissal of a prior case which may have been influenced by an unfavorable interim ruling might serve as a "successful termination"1 in favor of the defendant for purposes of later malicious prosecution litigation. ¶3 While the majority may have accurately predicted the outcome of the former litigation, had it proceeded to trial, this predicted adjudication never actually came to pass. There was no merits adjudication rendered. The issues had not been fully and fairly litigated to final judgment. To reach today's result, we are required to search the record of an earlier litigation and divine whether or not there were any set of facts that might have allowed the litigation to succeed and/or whether the prior plaintiff's motives were meritorious. ¶4 This approach creates ambiguity where the bench and bar previously enjoyed clarity, and it discourages plaintiffs from considering dismissing litigation in which interim rulings fall against them. I respectfully dissent. FOOTNOTES 1 "It is well established in Oklahoma that one of the elements a malicious-prosecution plaintiff must affirmatively prove is a successful termination in his favor of the original action." Glasgow v. Fox, 1988 OK 71, ¶ 12, 757 P.2d 836, 838.

d79c501c-152a-4d7d-9910-3b9cc94e7f61

Kingfisher Wind, LLC v. Wehmuller

oklahoma

Oklahoma Supreme Court

KINGFISHER WIND v. WEHMULLER2022 OK 83Case Number: 119837Decided: 10/18/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. KINGFISHER WIND, LLC., Plaintiff/Appellee,v.MATT WEHMULLER, CANADIAN COUNTY ASSESSOR, and CAROLYN MULHERIN, KINGFISHER COUNTY ASSESSOR, Defendants/Appellants. APPEAL FROM THE DISTRICT COURT OF CANADIAN COUNTY Honorable Jack D. McCurdy II, Trial Judge ¶0 The plaintiff, Kingfisher Wind, LLC., (Kingfisher Wind) is located partially in Canadian and Kingfisher Counties. After county assessors from each county valued its wind farm for ad valorem tax assessment, Kingfisher Wind appealed the valuation to the District Courts in each county. By agreement, the cases were consolidated in Canadian County, and the cause proceeded to trial with the primary issue being whether Production Tax Credits (PTCs) are "property" subject to ad valorem taxation. The trial court held that PTCs were not taxable, and it excluded their value from taxable valuation. The County Assessors appealed, and we retained the cause. We hold that PTCs are intangible personal property, and not subject to ad valorem taxation pursuant to the Okla. Const. art 10, §6A. Because the trial court's findings regarding valuation were not otherwise against the weight of the evidence, we affirm the trial court. TRIAL COURT AFFIRMED. William K. Elias, Jay Dobson, Brittany N. Dowd, Oklahoma City, Oklahoma, for Appellee. Mart Tisdal, Luke Adams, Clinton, Oklahoma, Mike Fields, Canadian County District Attorney, El Reno, Oklahoma, Pat O'Hara, Patrick O'Hara, Jr. W. Jason Hartwig, Oklahoma City, Oklahoma, for Appellants. David A. Elder, Matthew W. Brockman, Katherine R. Colclazier, Oklahoma City, Oklahoma, for Amici Curiae, Arbuckle Mountain Wind Farm, L.L.C., et al. KAUGER, J.: ¶1 We retained this cause to resolve the first impression question of whether Production Tax Credits (PTCs) utilized to finance the building of a wind farm are "property" which can be used to determine the fair cash value of the wind farm for ad valorem taxation purposes.1 We hold that PTCs are intangible personal property, and are not subject to ad valorem taxation pursuant to the Okla. Const. art. 10, §6 A. 2 Because the trial court's findings regarding valuation were not otherwise against the weight of the evidence, we affirm the trial court. FACTS ¶2 In 2015, the plaintiff/appellee, Kingfisher Wind, L.L.C. (Kingfisher Wind) began construction of a wind farm, which included one hundred forty-nine wind turbine generators, electrical equipment, a maintenance facility, substation, and transmission lines. One hundred of the turbine generators are located in Kingfisher County, Oklahoma, and forty-nine are located in Canadian County, Oklahoma. For 2016 ad valorem tax purposes,3 the Canadian County Assessor determined the fair cash value of the property located in Canadian County to be $157,476,788.00.4 ¶3 Kingfisher Wind filed a formal protest of the valuation with the Canadian County Board of Equalization.5 At the July 11 and July 29, 2016, protest hearings, the Canadian County Assessor presented an adjusted/altered cash value of $182,164,150.00, which the Canadian County Board accepted. ¶4 On August 8, 2016, Kingfisher Wind filed an appeal in the District Court of Canadian County, seeking trial de novo to correct the cash value of the property.6 It asserted that the actual fair cash value of the property was $84,666,000.00 or less. During the same time period, the Kingfisher County Assessor also valued the portion of the wind farm located in Kingfisher County at $321,381,200.00 for ad valorem tax purposes. ¶5 Kingfisher Wind also filed a protest with the Kingfisher County Board of Equalization and the Kingfisher Assessor presented an adjusted/altered cash value of $275,839,357.00 which the Kingfisher County Board accepted. Thus, the total fair cash value in both counties together was $458,003,507.00. Kingfisher Wind filed an appeal on August 8, 2016, in the District Court of Kingfisher County, seeking a trial de novo, asserting that the actual fair cash value was $169,331,000.00 or less. ¶6 On September 21, 2018, the Kingfisher Assessor and Kingfisher Wind jointly requested that the Kingfisher case be consolidated with the Canadian County case in the Canadian County District Court. The District Court of Kingfisher County issued an order on September 24, 2018, transferring the cause to Canadian County for purposes of consolidation and the causes were consolidated on October 12, 2018, by the District Court of Canadian County. ¶7 On April 26, 2019, Kingfisher Wind filed a Motion for Partial Summary Judgment in the now consolidated Canadian County case. It sought to have Production Tax Credits (PTCs) and certain contracts determined to be exempt from ad valorem taxation. PTCs are a federal tax equity financing concept which allowed Kingfisher Wind to finance the building of their facilities in exchange for a tax credit directly related to the kilowatt hour of electricity generated.7 In other words, they are a tax incentive, and they allow the owner of the PTCs to claim a tax credit on the energy produced thus saving on the payment of taxes. ¶8 PTCs are not real estate/real property, although they may be, as argued by the assessors, intrinsically tied to real estate because wind farms would likely not be built without them. Kingfisher Wind relied on: 1) The Okla. Const. art. 10 §6A which provides that "[b]eginning January 1, 2013, intangible personal property shall not be subject to ad valorem tax or to any other tax in lieu of ad valorem tax within this State;" and 2) Stillwater Housing Associates v. Rose, 2011 OK CIV APP 51, 254 P.3d 726 which held that tax credits are exempt from ad valorem taxation because they are intangible personal property and not income. The parties also disputed whether certain expert testimony, documents and depositions could be considered at trial. Each side presented expert witnesses' reports with differing methods of evaluation to determine the fair cash value of the subject property. Kingfisher Wind's experts excluded the PTC's in their valuation of the property, but the County Assessors did not. ¶9 After a hearing, the trial court filed a memorandum opinion on July 26, 2019, in which it found that Stillwater Housing, supra, was unpersuasive, and an improper application of the law. Consequently, the trial court held that PTCs were subject to ad valorem taxation. Regarding the contracts which Kingfisher Wind sought as exempt from taxation, the trial court said that "[t]he Defendants conceded at the hearing that the contracts, as outlined by the Plaintiff in its brief, were in fact exempt under Oklahoma law and the Court affirms that finding and sustains that part of Plaintiff's Motion for Partial Summary Judgment." The trial court also denied Kingfisher Wind's motion regarding expert testimony and exclusion of documents and depositions. ¶10 On October 28, 2019, Kingfisher Wind filed for leave of court to file another Motion for Summary Judgment. This time it sought a clarification by the trial court as to whether it had determined that the PTCs were taxable because they were income, but not intangible personal property, or because PTCs were actually tangible personal property. On November 22, 2019, the trial court granted Kingfisher Wind's request to file another Motion for Summary Judgment. ¶11 On March 6, 2020, the trial court issued another memorandum opinion in which it determined that the PTCs are not really property of any kind ---intangible or tangible. Rather, it said PTCs are incidental benefits received by investors as a result of their participation in an investment made in the future production of the wind farm that should not be treated as property. Nevertheless, it left open the issue of the "value" of PTCs to be used for taxation purposes as a matter for trial. ¶12 The trial court held a non-jury trial on April 12-14, 2021, to determine the overall fair market value of Kingfisher Wind for tax assessment purposes. On August 5, 2021, the trial court filed an order, reflecting its ruling in the non-jury trial. It ruled that: 1) the PTCs were contracted out by Kingfisher Wind to a third party prior to construction of the wind farm;8 2) because the PTCs were contracted out to finance construction, coupled with the fact that the experts in this cause lacked a convincing explanation as to how to treat the PTCs, the PTCs were not taxable, and were not particularly part of any value in this cause; and 3) the Kingfisher Wind farm was valued at $175,000,000 for taxation purposes with 39.78% attributable to Canadian County and 60.22% to Kingfisher County (which translated to $69,615,000 taxable value for Canadian County and $105,385,000 for Kingfisher County). ¶13 On September 7, 2021, the County Assessors appealed, and filed a motion to retain the appeal in this Court. We granted the motion and retained the cause on October 6, 2021. On April 18, 2022, fifteen wind farm limited liability companies filed a request to file an amicus curaie brief in this cause. We granted the request on May 3, 2022, and they filed the amicus curiae brief on May 31, 2022.9 After the briefing cycle was complete, the cause was assigned on June 29, 2022, for an opinion from the Court. PRODUCTION TAX CREDITS ARE INTANGIBLE PERSONALPROPERTY EXEMPT FROM AD VALOREM TAXATION UNDER THE OKLA. CONST. ART. 10 §6A. ¶14 The commissioners label PTCs as tangible personal property subject to taxation. The gravamen of their argument is that the PTCS are of such an economic benefit to owning, operating, and determining the full fair cash value of the wind farm and its real property, they must be included to determine a fair and accurate taxable ad valorem valuation of the wind farm. Kingfisher Wind argues that PTCs are intangible personal property and are precluded from taxation by the Okla. Const. art 10, §6 A. 10 a. Standard of Review ¶15 When an ad valorem tax appeal is taken to a district court, the proceeding is governed by equitable principles and the district court's review is de novo.11 It is well settled that the burden of proving entitlement to an exemption is on the individual seeking the exemption, and constitutional provisions are strictly construed against those claiming exemption.12 While we review a district court's judgment in determining fair cash value of property as to whether it is contrary to the clear weight of the evidence,13 questions of law, or mixed questions of law and fact are reviewed de novo.14 b. Exempted Intangible Personal Property and the PTCs. ¶16 All real and personal property in this State is generally subject to ad valorem taxation at a percentage of its fair cash value,15 unless it is expressly exempted by law.16 Fair cash value means the value or price at which a willing buyer would purchase property and a willing seller would sell property if both parties are knowledgeable about the property and its uses.17 Such property is further classified as real property, personal property, personal property in the form of household goods, public service corporation property, or railroad and air carrier property.18 Real property generally being land and attached fixtures,19 and personal property being nearly everything else.20 ¶17 In Southwestern Bell Telephone Co. v. Okla. State. Bd. of Equalization, 2009 OK 72, 231 P.3d 638, we recognized that the classification of personal property included intangible personal property.21 Initially, the Okla. Const. art. 10 §6A, listed only certain property items such as money, stocks, bonds, and certain credit accounts, to be defined as intangible property exempted from taxation.22 In Southwestern Bell, supra, Southwestern Bell, in addition to the intangible property listed by the Constitution, sought exemption for other intangible items such as customer lists, customer relations, assembled work force, databases, goodwill, employment contracts, patented technology, lease agreements, trademarks, and trade names, licensed software, extensive advertising and the attendant copyrights on advertising and technical documentation. We held that only the specific intangible property items listed by the Constitution were exempt from taxation. Consequently, any other intangible property not exempted by the Constitution was taxable. ¶18 In response to our constitutional interpretation in Southwestern Bell, supra, the voters passed State Question 766 in November of 2012. It amended the Okla. Const., art. 10, §6A to omit the specific list of intangible personal property exempt from taxation and simply stated that: Beginning January 1, 2013, intangible personal property shall not be subject to ad valorem tax or to any other tax in lieu of ad valorem tax within this State. We have not previously addressed what this amendment meant, but without defining what would be considered "intangible personal property," the amendment requires all intangible personal property to be exempt from taxation. Accordingly, the question is whether PTCs are intangible personal property exempt from ad valorem taxation. ¶19 The constitutional text does not define the term "intangible personal property. The Ad Valorem Tax Code, 68 O.S. 2011 §§2801 et seq. does not define either tangible or intangible property. "Tangible personal property" is defined by statute, for the limited application of the Sales Tax Code, as "personal property that may be seen, weighed, measured, felt, or touched or that is any manner perceptible to the senses.23 Consequently, it has been left to the Court to delineate the difference between tangible and intangible property for purposes of ad valorem taxation. ¶20 In Globe Life and Accident Ins. Co., v. Okla. Tax Com'n, 1996 OK 39, 913 P.2d 1322, the Court addressed what represented intangible personal property for purposes of a use-tax levy. Precisely, it addressed whether the information on encoded magnetic computer tapes (names and addresses of potential customers) was taxable. Like the Oklahoma Constitution, the Use Tax Code24 did not define intangible personal property. The Court noted that the Sales Tax Code25 had expanded the scope of tangible property transactions to include computer magnetic tapes. We also looked to the types of personal property which existed at common law. ¶21 In Globe Life, supra, we said: ¶9 At common law "tangible personal property" refers to rights in tangible physical things of the world over which possession may be taken. "Intangible personal property" encompasses property rights which - though represented by tangible objects (e.g., stock certificates, bonds and notes) - are essentially incorporeal in that they have limited intrinsic value and ultimately can only be claimed or enforced by a legal action. At common law things which are incorporated in the manufacturing process are subsumed into the end product and are classified as either tangible or intangible personal property according to the product's final use or disposition. There is no common-law notion of mixed personal property - i.e., personalty that is part intangible, part tangible. (Emphasis supplied, footnotes omitted.) Regarding rules for construing tax statutes we said: ¶10 Tax statutes are penal in nature. Where there is reasonable doubt about the taxing act's meaning, all ambiguity must be resolved in favor of the taxpayer. Legislative intention - ascertained from a general consideration of the entire act - must be given effect. Nonetheless, courts cannot enlarge the taxing act's ambit to make its provisions applicable to cases not clearly within the Legislature's contemplation or to fill lacunae in the revenue law in a manner that would distort the enactment's plain language. (Footnotes omitted.) ¶22 While we determined in Globe Life, supra, that magnetic tapes had aspects of both tangible and intangible property, we noted the existence of a gap in the law. The Sales Tax Code defined magnetic tapes' contents, but the Use Tax Code did not. We said "the proper remedy for the OTC [Oklahoma Tax Commission] is not to have the courts expand the Use Tax Code's scope to include intangible personal property, but rather to press for the gaps closure by the Legislature." Accordingly, because the tapes had aspects of both tangible and intangible personal property, we concluded that they must be treated as intangible property, and that they were outside of the Use Code's ambit and were not subject to a tax levy. ¶23 We are faced with a similar gap in this cause. If the Legislature had wished to statutorily define PTCs as tangible property, it could have done so, but it has not done so yet. We have no doubt that PTCs have a direct impact on a property's fair market value, and that ad valorem tax assessments must be based on fair market value. PTCs, however, are not a tangible physical thing like real estate. Instead, they are incorporeal property in that they have limited intrinsic value, and ultimately can only be claimed or enforced by a legal action, much like goodwill,26 even if they are intrinsically tied to a business or real property. ¶24 Given the rationale of Globe Life, supra, as well as the fact that the Constitution was changed after our decision in Southwestern Bell, supra, to exclude all intangible property from taxation, we must conclude that PTCs are to be treated as intangible property, even if they have qualities of both tangible and intangible property. We recognize that this creates a conflict for taxing authorities to both assess a "fair market value," and to exclude PTCs from consideration. However, PTCs are simply not subject to ad valorem taxation under Oklahoma law at this time. ¶25 Our sister states are divided on whether to include tax credits in tax assessments. However, these cases have limited value to this cause because they have often been decided on constitutional and statutory provisions incompatible with our own state's provisions. Nevertheless, we note them because they generally further explain how other courts have treated and considered such tax credits. ¶26 Some states, like Tennessee and South Dakota have no constitutional or statutory exemption for taxation of intangible personal property.27 Consequently, tax credits are included in tax assessments because they have been determined to effect the true and full value of the property.28 Michigan has a constitutional prohibition against taxing intangible personal property, but the courts recognize that the value of nontaxable intangible assets such as tax credits are directly related to the value of real property and thus allow them to be taxed regardless of the prohibition.29 Illinois and Idaho do not treat tax credits as intangible personal property because they have determined that they have no independent value apart from the real property assessed.30 Pennsylvania allows consideration of tax credits for property valuation.31 ¶27 In 2003, an Arizona Tax Court took an approach opposite from Michigan when it determined that tax credits were intangible personal property, and that they could not be considered in making real estate tax assessments of the taxpayer's property.32 It described tax credits as incentives to invest in the project rather than income flowing from it. It also noted that tax credits: 1) will not significantly affect the marketability of the project; 2) do not play a significant role in any negotiations between a buyer and a seller; and 3) are not an integral part of the real estate.33 ¶28 Georgia courts allowed tax credits to be considered in fair market value for tax assessment, but statutory amendments later expressly excluded tax credits from consideration.34 In Oregon, tax credit programs are considered a restriction which should not be used to value property for ad valorem taxation purposes.35 Washington, Missouri, and Ohio consider tax credits as intangible personal property and do not allow the inclusion of tax credits to be taken into account in assessed value.36 ¶29 We have no doubt that tax credits are intertwined with real estate, and that they may enhance the value of real property or may have a value for IRS income tax purposes. Nevertheless, under the plain and ordinary language of the Okla. Const. art. 10, §6A, intangible personal property is not taxable and PTCs are intangible personal property. The Legislature has not chosen to define PTCs so as to allow them to be taxable as part of a real property tax assessment. Until it does so, they are not subject to taxation. Furthermore, we have reviewed the evidence, and the trial court's findings as to the valuation of the properties were not against the weight of the evidence. Consequently we affirm the trial court. CONCLUSION ¶30 The Okla. Const. art. 10 §6A provides that "[b]eginning January 1, 2013, intangible personal property shall not be subject to ad valorem tax or to any other tax in lieu of ad valorem tax within this State." "Tangible personal property" refers to rights in tangible physical things of the world over which possession may be taken. "Intangible personal property" encompasses property rights which - though represented by tangible objects (e.g., stock certificates, bonds and notes) - are essentially incorporeal in that they have limited intrinsic value and ultimately can only be claimed or enforced by a legal action.37 ¶31 PTCs are intangible personal property exempt from ad valorem taxation -- even if they have both tangible and intangible aspects. The trial court properly excluded PTCs from valuation for ad valorem taxation. Because the trial court's findings regarding valuation were not otherwise against the weight of the evidence, we affirm the trial court. TRIAL COURT AFFIRMED. ALL JUSTICES CONCUR. FOOTNOTES 1 We have consolidated all of the assessors' listed issues into whether PTCs are taxable and whether the trial court's decision for valuation was in error. 2 The Okla. Const. art. 10 §6A provides: Beginning January 1, 2013, intangible personal property shall not be subject to ad valorem tax or to any other tax in lieu of ad valorem tax within this State. 3 Title 68 O.S. 2011 §2801 provides: Articles 28, 29, 30 and 31 of Title 68 of the Oklahoma Statutes shall be known and may be cited as the Ad Valorem Tax Code. Title 68 O.S. 2011 §2804 provides: All property in this state, whether real or personal, except that which is specifically exempt by law, and except that which is relieved of ad valorem taxation by reason of the payment of an in lieu tax, shall be subject to ad valorem taxation. 4 Title 68 O.S. 2011 §2819 provides: Taxable values of real and personal property shall be established in accordance with the requirements of Sections 8, 8B and 8C of Article X of the Oklahoma Constitution. The county assessor shall determine the taxable value of all taxable property that the assessor is required by law to assess and value and shall determine such taxable value in accordance with the requirements of Sections 8, 8B and 8C of Article X of the Oklahoma Constitution. 5 Title 68 O.S. Supp 2015 §2876 outlines the protest procedures for taxpayers. 6 Title 68 O.S. Supp. 2015 §2880.1 provided in pertinent part: A. Both the taxpayer and the county assessor shall have the right of appeal from any order of the county board of equalization to the district court of the same county, and right of appeal of either may be either upon questions of law or fact including value, or upon both questions of law and fact. In case of appeal the trial in the district court shall be de novo. Provided, the county assessor shall not be permitted to appeal an order of the county board of equalization upon a question of the constitutionality of a law upon which the board based its order, but the county assessor is hereby authorized in such instance to request a declaratory judgment to be rendered by the district court. . . . The statute was amended in 2019, and 2022 to be effective on January 1, 2023. 7 PTCs were originally created under the Energy Policy Act of 1992, and they are a ten-year, inflation adjusted US federal income tax credit for each kilowatt hour (kWh) of electricity generated by certain types of renewable or zero carbon emission projects, provided certain conditions are met. According to Kingfisher Wind, the PTCs in this cause are apparently held by Mid-American Wind Tax Equity Holdings, LLC, the tax equity invertor of the Kingfisher Wind project. 8 The trial court notes that this exchange is known as tax equity financing where the right to claim the tax credit is in the form of Class A membership interest and it is given in exchange for financing prior to construction. 9 We also had untimely requests from the Oklahoma State School Boards Association, the Cooperative Council for Oklahoma School Administration, listed County Assessors of Oklahoma, and the Association of County Commissioners of Oklahoma to file amicus curiae briefs as well. We denied those requests by order sheet on August 25, 2022. 10 The Okla. Const. art. 10, §6A, see note 2, supra. 11 Title 68 O.S. Supp. 2015 §2880.1, see note 6, supra. 12 Southwestern Bell Telephone Co., v. Okla. State Bd. of Equalization, 2009 OK 72, ¶21, 231 P.3d 638; Austin, Nichols & Co., 1978 OK 65, ¶19, 578 P.2d 1200. 13 In the Matter of the Assessment of Personal Property Taxes Against Missouri Gas Energy, 2008 OK 84, ¶17, 234 P.2d 938. 14 In the Matter of the Assessment of Personal Property Taxes Against Missouri Gas Energy, see note 13, supra; Ellington v. Horwitz Enterprises, 2003 OK 37, ¶4, 68 P.3d 983. 15 See, 68 O.S. 2011 §8, Valuation of property for taxation, which sets forth the percentage of fair cash value for tangible personal property, real property, and all other property. Personal property, with the exception of intangible personal property, must conform to the fair cash value estimated at the price it would bring at a fair voluntary sale. 68 O.S. 2011 §2018; 68 O.S. Supp. 2022 §2017. 16 Title 68 O.S. 2011 §2804 provides: All property in this state, whether real or personal, except that which is specifically exempt by law, and except that which is relieved of ad valorem taxation by reason of the payment of an in lieu tax, shall be subject to ad valorem taxation. 17 The Ad Valorem Tax Code, 68 O.S. 2011 §2801 et seq. in §2802 defines fair cash value as follows: 19. "Fair cash value" or "market value" means the value or price at which a willing buyer would purchase property and a willing seller would sell property if both parties are knowledgeable about the property and its uses and if neither party is under any undue pressure to buy or sell and for real property shall mean the value for the highest and best use for which such property was actually used, or was previously classified for use, during the calendar year next preceding the applicable January 1 assessment date; Section 2802 has been amended several times since its enactment in 1968, but the current definition of fair cash value which became effective in 2021, has essentially remained the same. Furthermore, §2817 provides in pertinent part: H. When the term "fair cash value" or the language "fair cash value, estimated at the price it would bring at a fair voluntary sale" is used in the Ad Valorem Tax Code, in connection with and in relation to the assessment of real property, it is defined to mean and shall be given the meaning ascribed and assigned to it in this section and when the term or language is used in the Code in connection with the assessment of personal property it shall be given its ordinary or literal meaning. 18 Title 68 O.S. 2011 §2803. 19 Title 68 O.S. 2011 §2806. 20 Title 68 O.S. Supp. 2015 §2807. 21 This recognition is consistent with 68 O.S. Supp. 2015 §2807 which provides in pertinent part, and includes in the definition of personal property: . . .13. All other property, having an actual, constructive or taxable situs in this state, and not included within the definition of real property. 22 Originally adopted for the 1968 tax year, the Okla. Const. art. 10 §6a provided: Intangible personal property as below defined shall not be subject to ad valorem tax or to any other tax in lieu of ad valorem tax within this State: (a) Money and cash on hand, including currency, gold, silver, and other coin, bank drafts, certified checks, and cashier's checks. (b) Money on deposit in any bank, trust company, or other depository of money, within or without the State of Oklahoma, including certificates of deposit. (c) Accounts and bills receivable, including brokerage accounts, and other credits, whether secured or unsecured. (d) Bonds, promissory notes, debentures, and all other evidences of debt whether secured or unsecured; except notes, debentures, and other evidences of debt secured by real estate mortgages which are subject to the Mortgage Registration Tax under Sections 12351 - 12362, inclusive, Oklahoma Statutes, 1931 (68 O.S. 1961, Sections 1171 - 1182). (e) Shares of stock or other written evidence or proportional shares of beneficial interests in corporations, joint stock companies, associations, syndicates, express or business trusts, special or limited partnerships, or other business organizations. (f) All interests in property held in trust or on deposit within or without this State, and whether or not evidenced by certificates, shares, or other written evidence of beneficial ownership. (g) Final judgments for the payment of money. (h) All annuities and annuity contracts. The effective date of this Amendment shall be January 1, 1969; provided, that the intangible personal property taxes levied for the year 1968 shall be collected. There is also a second art 10, §6a dealing with dealing with tangible personal property moving through the state which is not at issue here. 23 Title 68 O.S. Supp. 2016 §1352 provides in pertinent part: . . . 24. "Tangible personal property" means personal property that can be seen, weighed, measured, felt, or touched or that is in any other manner perceptible to the senses. "Tangible personal property" includes electricity, water, gas, steam and prewritten computer software. This definition shall be applicable only for purposes of the Oklahoma Sales Tax Code; . . . 24 Title 68 O.S. 1991 §§1401 et seq. 25 Title 68 O.S. 1991 §§1301 et seq. 26 We have found that a business's goodwill would be an intangible personal property. See generally, In the Matter of Protest of Hare, 2017 OK 60, 398 P.3d 317. We have also held that natural gas is tangible property or at least the interest in the natural gas at issue in In the Matter of the Assessment of Personal Property Taxes Against Missouri Gas Energy, see note 13, supra. In the context of sales tax, the Court determined the a fuel oil transaction was tangible personal property in Koch Fuels, Inc., v. State of Okla. ex rel. Okla. Tax Com'n, 1993 OK 140, ¶16, 862 P.2d 471. Likewise, the Court of Civil Appeals held that contact sheets, transparencies, and videos that a photographer provided to clients were tangible personal property within the meaning of sales tax in In the Matter of Sales Tax Protest of West v. State of Okla. ex rel. Okla. Tax Com'n, 1999 OK CIV APP 24, ¶12, 979 P.2d 263. 27 Amdur, James A., Inclusion of Intangible Asset Values in Tangible Property Tax Assessments, 90 A.L.R. 5th 547, (2001). 28 Town Square Ltd. Partnership v. Clay County Board of Equalization, 2005 S.D. 99, ¶19, 704 N.W.2d 896 (2005) (South Dakota makes no distinction between tangible and intangible property, so whether tax credits are intangible personal property is irrelevant. Tax credits are included because they can be transferred to purchasers and they enhance the value of the property in the marketplace.); Spring Hill, L.P., v. Tennessee State Board of Equalization, 2003 WL 23099679 (Tenn. Ct. App. 2003) (Tennessee makes a statutory distinction between real property, tangible personal property, and intangible personal property, but all classifications are taxed. Tax credits relate directly to the real property and are not an intangible benefit severable from it. They must be included in tax assessments because the purpose of a valuation is to determine the fair cash value, based upon the willing buyer-willing seller concept and incoming producing capacity. Ignoring tax credits would distort the earning capacity and value of the property.) Both of these cases involve the use of the LIHTC program created as part of the Federal Tax Reform Act of 986, and they utilize the IRS Code to provide an incentive for the construction and rehabilitation of low-income rental housing. 29 Huron Ridge L.P., v. Ypsilanti Township, 737 N.W.2d 187 (Mich. App. 2007) (The appraised value of the property would be artificially depressed if the value of the tax credits were not included. If the tax credits are intertwined with the business, rather than the real property they would not be taxable.). See also, In the Matter of Ottawa Housing Assoc., L.P., 10 P.3d 777, 780 (Kan. App. 2000)(Recognizing that any restrictions on low income housing contract should be considered for ad valorem taxation.); In the Matter of Appeal of Greens of Pine Glen LTD., 576 S.E.2d 316, 322 (N.C. 2003) (Tax payer may not artificially alter the value of its property by applying such things as tax credits.); Pedcor Investments v. State Bd., 715 N.E.2d 432, 437 (Tax Ct. Indiana 1999) (Commissioners properly considered federal tax incentive providing benefits to property owners.). 30 In City of Chicago v. Michigan Beach Housing Cooperative, 242 Ill. ApP.3d 636, 609 N.E.2d 877, 885-887 (1993), the Illinois Appellate Court for the First District held that tax credits could not serve as collateral because they were not generally intangible personal property. They had no independent value because they were merely an incidental benefit to investing. In Rainbow Apartments v. Illinois Property Tax Appeal Board, 326 Ill. App.3d 1105, 260 Ill. Dec. 875, 762 N.E.2d 534, 537 (201), the Illinois Appellate Court for the Fourth District held that tax credits were not intangible property sold and existing apart from the real estate cause they have no independent value. They may be included in the property's fair cash value. Brandon Bay, Ltd. Partnership v. Payette County, 132 P.3d 428 (Tax credits were rights and privileges belonging to the real estate, as opposed to contract rights, and thus were properly considered in assessing value.). Apparently Alaska has not decided the issue. When confronted with it in Horan v. Kenai Peninsula Borough Board of Equalization, 237 P.3d 990, 999 (2011), the Supreme Court of Alaska remanded the matter back to the Board of Equalization so that the Board could clarify its treatment of tax credits in a valuation of a low-income housing apartment complex. 31 Parkside Townhomes Assoc. v. Bd. Of Assessment Appeals of York County, 711 A.2d 607, 610-11 (Commonwealth Ct. Penn. 1998). 32 Cottonwood Affordable Housing v. Yavapai County, 205 Ariz. 427, 72 P.3d 357 (Tax Ct. Ariz. 2003). 33 In 2014, the Arizona legislature amended its renewable energy statutory provisions to expressly provide that the full cash value of taxable renewable energy equipment, reduced by the value of any investment tax credits, production tax credits or cash grants in lieu of investment tax credits, would be applicable to renewable energy equipment . A.R.S. §42-14155 (2014), as discussed in Siete Solar, L.L.C. v. Arizona Department of Revenue, 2015 WL 8620672 (Ct. App. Ariz.. 2015) (Determining that the statutory amendment actually changed the law. Prior to the amendment the Arizona Department of Revenue taxed the cost of the renewable energy equipment without lessening the costs by tax credits or cash grants the taxpayer received. However, this practice did not result in taxation of those incentives, but merely resulted in taxation on the cost originally expended on the equipment.). 34 Pine Pointe Housing, L.P. v. Lowndes County Bd of Tax Assessors, 561 S.E.2d 860 (Ga. Ct. App. 2002) discussing allowing tax credits in order to consider fair market value of property but recognizing statutory change which prohibited consideration was not retroactive. 35 Baybridge Associates Ltd. Partnership v. Dept. of Revenue, 892 P.2d 1002, 107 (Or. 1995). 36 Maryville Properties L.P. v. Nelson, 83 S.W.3d 608, 617 (Mo. App. W.D. 2002); Cascade Court Ltd. Partnership v. Noble, 20 P.3d 997, 1002 (Wash. App. Div. 1 2001); Woda Ivy Glen Ltd. Partnership v. Fayette County Bd. of Revision, 2009 Ohio 762, ¶29, fn. 4, 902 N.E.2d 984, 992). 37 Globe Life and Accident Ins. Co., v. Okla. Tax Com'n, 1996 OK 39, 913 P.2d 1322.

44fc84f9-509c-4db4-ba13-fcd36723ba57

Cherokee Nation v. Lexington Insurance Co., et al.

oklahoma

Oklahoma Supreme Court

CHEROKEE NATION v. LEXINGTON INSURANCE CO.2022 OK 71Case Number: 119359Decided: 09/13/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CHEROKEE NATION; CHEROKEE NATION BUSINESSES, LLC; CHEROKEE NATION ENTERTAINMENT, LLC, Plaintiffs/Appellees, v. (1) LEXINGTON INSURANCE COMPANY; (2) CERTAIN UNDERWRITERS AT LLOYD'S, LONDON SUBSCRIBING TO POLICY NO. PJ193647: (ASC 1414, KLN 510, ATL 1861, CIN 318, TAL 1183, AGR 3268 and XL CATLIN INSURANCE COMPANY UK Ltd.); (3) CERTAIN UNDERWRITERS AT LLOYD'S, LONDON SUBSCRIBING TO POLICY NO. PJ1900131: (CNP4444); (4) UNDERWRITERS AT LLOYD'S -- ASPEN SPECIALTY INSURANCE COMPANY; (5) CERTAIN UNDERWRITERS AT LLOYD'S, LONDON SUBSCRIBING TO POLICY NO. PJ1933021: (ASC 1414, KLN 510, CIN 318, ATL 1861, CHN 2015, APL 1969, QBE 1886 and XL CATLIN INSURANCE COMPANY UK Ltd.); (6) CERTAIN UNDERWRITERS AT LLOYD'S, LONDON SUBSCRIBING TO POLICY NO. PD-10363 (BRT 2987) FOR CHEROKEE NATION ENTERTAINMENT, LLC; PD-10367-05 (BRT2987) FOR CHEROKEE NATION BUSINESSES, and PD-11091-00 (BRT2987) FOR CHEROKEE NATION; (7) CERTAIN UNDERWRITERS AT LLOYD'S LONDON SUBSCRIBING TO POLICY NO. PJ19000067: (KLN 510, TMK 1880, CNP 4444, ATL 1861, BRT 2987 and 2988, AUW 0609, TAL 1183, AUL 1274, NEON WORLDWIDE PROPERTY CONSORTIUM 9761); (8) HOMELAND INSURANCE COMPANY OF NY (ONE BEACON); (9) HALLMARK SPECIALTY INSURANCE COMPANY; (10) ENDURANCE WORLDWIDE INSURANCE LTD. T/AS SOMPO INTERNATIONAL (POLICY NUMBERS PJ1900134-A and PJ1900134-B); (11) ARCH SPECIALTY INSURANCE COMPANY; (12) EVANSTON INSURANCE COMPANY; (13) ALLIED WORLD NATIONAL ASSURANCE COMPANY; (14) LIBERTY MUTUAL FIRE INSURANCE COMPANY; (15) XL INSURANCE AMERICA, INC.; (16) AXA/XL AMERICA, INC.;1 (17) RSUI-LANDMARK AMERICAN INSURANCE COMPANY; (18) CHUBB BERMUDA LTD.; (19) UNDERWRITERS AT LLOYD'S LONDON;2 (20) ABC INSURANCE COMPANIES (to be determined); Defendants/Appellants. ON APPEAL FROM THE DISTRICT COURT OF CHEROKEE COUNTY The Honorable Douglas Kirkley, Trial Judge ¶0 Cherokee Nation filed a declaratory judgment action seeking insurance coverage under the business interruption provision of a policy issued by insurers for the economic losses it incurred when it temporarily closed its properties due to the threat of COVID-19. The district court granted Cherokee Nation's motion for partial summary judgment, holding the phrase "direct physical loss" in the business interruption provision of the policy included coverage for losses sustained by property rendered unusable for its intended purpose. The district court also found that none of the exclusions raised by the insurers applied to Cherokee Nation's loss. The insurers appealed, and we retained the appeal. We hold that Cherokee Nation's losses are not covered under the business interruption section of the insurance policy at issue. The district court erred in finding business interruption coverage when Cherokee Nation did not sustain immediate, tangible deprivation or destruction of property. DISTRICT COURT'S JUDGMENT REVERSED AND REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. Michael Burrage, Reggie Whitten, Patricia Sawyer, Austin Vance, J. Renley Dennis, and Tiffani J. Shipman, Whitten Burrage, Oklahoma City, Oklahoma, for Plaintiffs/Appellees. Bradley Beckworth and Chad E. Ihrig, Nix Patterson, LLP, Austin, Texas, for Plaintiffs/Appellees. Sara Hill, General Counsel for Cherokee Nation, Tahlequah, Oklahoma, for Plaintiffs/Appellees. Phil R. Richards and Joy Tate, Richards & Connor, Tulsa, Oklahoma, for Lexington Insurance Company, Defendant/Appellant. Richard J. Doren and Matthew A. Hoffman, Gibson Dunn & Crutcher LLP, Los Angeles, California, for Lexington Insurance Company, Defendant/Appellant. Harvey D. Ellis and Timila S. Rother, Crowe & Dunlevy, P.C., Oklahoma City, Oklahoma, for Certain Underwriters at Lloyd's, London et al. and Endurance Worldwide Insurance Ltd., Defendants/Appellants. Amy Sherry Fischer and Larry D. Ottoway, Foliart, Huff, Ottaway & Bottom, Oklahoma City, Oklahoma, for Certain Underwriters at Lloyd's, London et al. and Endurance Worldwide Insurance Ltd., Defendants/Appellants. Matthew P. Cardosi, Robins Kaplan LLP, Boston, Massachusetts, for Certain Underwriters at Lloyd's, London et al. and Endurance Worldwide Insurance Ltd., Defendants/Appellants. Amy M. Churan, Robins Kaplan LLP, Los Angeles, California, for Certain Underwriters at Lloyd's, London et al. and Endurance Worldwide Insurance Ltd., Defendants/Appellants. Jon E. Brightmire and Michael S. Linscott, Doerner, Saunders, Daniel & Anderson, L.L.P., Tulsa, Oklahoma, for Aspen Specialty Insurance Company and Aspen Insurance UK, Ltd., Defendants/Appellants. Sara E. Potts, Doerner, Saunders, Daniel & Anderson, L.L.P., Oklahoma City, Oklahoma, for Aspen Specialty Insurance Company and Aspen Insurance UK, Ltd., Defendants/Appellants. James C. Milton, William O'Connor, Bryan J. Nowlin, and Margo E. Shipley, Hall, Estill, Hardwick, Gable, Golden & Nelson, P.C., Tulsa, Oklahoma, for Homeland Insurance Company of NY (One Beacon), Arch Specialty Insurance Company, Allied World National Assurance Company, Liberty Mutual Fire Insurance Company, and Landmark American Insurance Company, Defendants/Appellants. Shannon O'Malley, Kristin Cummings, and Bennett Moss, Zelle LLP, Dallas, Texas, for Homeland Insurance Company of NY (One Beacon), Arch Specialty Insurance Company, Liberty Mutual Fire Insurance Company, and Landmark American Insurance Company, Defendants/Appellants. Jack Cadenhead, The Cadenhead Law Firm, P.C., Seminole, Oklahoma, for Allied World National Assurance Company, Defendant/Appellant. Dustin DuBose, Mound Cotton Wollan Greengrass, LLP, Houston, Texas, for Allied World National Assurance Company, Defendant/Appellant. Kerry R. Lewis and Dan S. Folluo, Rhodes, Hieronymus, Jones, Tucker & Gable, PLLC, Tulsa, Oklahoma, for Hallmark Specialty Insurance Company, Aspen Specialty Insurance Company, and Aspen Insurance UK, Ltd., Defendants/Appellants. Joe M. Hampton and Johnny R. Blassingame, Hampton Barghols Pierce, PLLC, Oklahoma City, Oklahoma, for Chubb Bermuda International,3 Defendant/Appellant. Susan Sullivan, Clyde & Co. US, LLP, Los Angeles, California, for Chubb Bermuda International, Defendant/Appellant. Robert W. Fischer and Taylor L. Davis, Clyde & Co. US, LLP, Atlanta, Georgia, for Chubb Bermuda International, Defendant/Appellant. Roger N. Butler, Jr. and Nathaniel T. Smith, Secrest, Hill, Butler, Secrest, Tulsa, Oklahoma, for Evanston Insurance Company, Defendant/Appellant. C. William Threlkeld and Sterling E. Pratt, Fenton, Fenton, Smith, Reneau & Moon, Oklahoma City, Oklahoma, for XL Insurance America, Inc., Defendant/Appellant. Winchester, J. ¶1 The COVID-19 pandemic has impacted businesses in an unprecedented way. Naturally, businesses have turned to their insurers for the economic losses they have experienced. Appellees Cherokee Nation, Cherokee Nation Businesses, LLC, and Cherokee Nation Entertainment, LLC4 (collectively, Nation) likewise turned to Appellant Insurers5 to recover economic losses they incurred when they temporarily closed their properties in March 2020 to prevent COVID-19 related harm to their patrons, employees, and properties. ¶2 Nation brought a declaratory judgment action in district court seeking a ruling that the Tribal First Policy Wording, Tribal Property Insurance Program USA Form No. 15 (Policy) provides coverage under the business interruption provision for the losses it incurred due to its temporary closure. The question before this Court is whether the district court correctly determined that business interruption coverage for losses "caused by direct physical loss or damage . . . to real and/or personal property" includes losses incurred by some intangible harm that rendered Nation's property unusable for its intended purpose. The district court's expansion of business interruption coverage ignores the plain, unambiguous language of the Policy and the decisions from nearly all circuit courts of appeals, many federal district courts, and state courts that have ruled that business interruption coverage requires actual, tangible loss or damage to property, not just loss of use. We agree with the clear majority of jurisdictions and hold that "direct physical loss or damage . . . to real and/or personal property" requires immediate, actual or tangible deprivation or destruction of property. FACTS AND PROCEDURE ¶3 In July 2019, Nation purchased an all-risk property insurance Policy from Insurers that included business interruption coverage. In March 2020, Nation decided to temporarily close its properties due to the threat of COVID-19. The properties remained closed until June 2020. Nation then brought this action seeking business interruption coverage under the property insurance Policy for its economic losses during the closure. ¶4 Nation filed a motion for partial summary judgment on business interruption coverage. Nation contended that the closure of its properties was a fortuitous event causing the loss of use of its properties, amounting to a "direct physical loss" as covered by the Policy. ¶5 Insurers opposed this motion, arguing that the Policy did not provide coverage for Nation's alleged losses because it did not sustain "direct physical loss or damage" to its properties and the district court did not have to consider the Policy's exclusions. Insurers contended that business interruption coverage occurs only during the restoration period that consists of the rebuilding, repairing, or replacing of an insured's damaged or lost property. Insurers urged that Nation did not suffer a "direct physical loss or damage . . . to real and/or personal property" that required any rebuilding, repairing, or replacing, but instead Nation merely did not use its properties for a temporary period of time. ¶6 The district court granted Nation's motion for partial summary judgment, finding coverage for Nation's alleged losses under the Policy's business interruption provision. The district court considered that Insurers did not define the phrase "direct physical loss or damage" in their policies and held that coverage for "direct physical loss" included losses sustained from property rendered unusable for its intended purpose. The district court also found that none of the exclusions raised by Insurers contemplated "pandemics, or suspected, imminent, threatened, or fear of viruses"--common language utilized by carriers to clearly exclude such losses. The district court concluded the exclusions did not apply to Nation's loss. Insurers appealed, and we retained the appeal. ¶7 The issue before this Court is whether the district court in finding coverage for Nation's alleged loss, correctly determined that the phrase "direct physical loss or damage" included coverage for losses sustained by property that was unusable for its intended purpose. We hold the phrase "direct physical loss or damage" does not include coverage for merely loss of use of property. Instead, the phrase "direct physical loss or damage . . . to real and/or personal property" requires immediate and actual, material, or tangible deprivation or destruction of property. Govinda, LLC v. Columbia Mut. Ins. Co., 545 F. SupP.3d 1167, 1172 (W.D. Okla. 2021) (applying Oklahoma law) (citing Goodwill Indus. of Cent. Okla., Inc. v. Phila. Indem. Ins. Co., 499 F. SupP.3d 1098, 1102-03 (W.D. Okla. 2020)). Nation does not present any evidence that its property was tangibly damaged or destroyed. The Policy does not cover its alleged loss, and we reject Nation's invitation to expand business interruption coverage under the facts of this case. STANDARD OF REVIEW ¶8 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the district court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. The Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. The underlying facts contained in the record are to be considered in the light most favorable to the party opposing summary judgment. U.S. Bank, 2012 OK 43, ¶ 13, 280 P.3d at 939. ¶9 The interpretation of an insurance policy is a question of law, reviewed de novo. May v. Mid-Century Insurance Company, 2006 OK 100, ¶ 22, 151 P.3d 132, 140. The whole of a policy is to be taken together, each clause helping to interpret the others. 15 O.S.2021, ch. 3, § 157, https://govt.westlaw.com/okjc. We enforce the policy to carry out the parties' intentions at the time the parties entered into the contract. When a policy's terms are unambiguous and clear, the employed language is accorded its ordinary, plain meaning. Bituminous Cas. Corp. v. Cowen Constr., Inc., 2002 OK 34, ¶ 9, 55 P.3d 1030, 1033. DISCUSSION ¶10 The foremost principle in Oklahoma law governing insurance coverage disputes is that an insurance policy is a contract. Am. Econ. Ins. Co. v. Bogdahn, 2004 OK 9, ¶ 8, 89 P.3d 1051, 1054. The insured and insurer are free to contract for insurance coverage for such risks as they see fit, and the parties are bound by the terms of their agreement. The Court will not undertake to rewrite the terms of an insurance contract or make a better contract than the one which the parties executed. Bituminous Cas. Corp., 2002 OK 34, ¶ 9, 55 P.3d at 1033. The Court will also not indulge in forced or constrained interpretations to create and then construe ambiguities in insurance contracts. An insurance contract is ambiguous only if it is susceptible to two constructions on its face from the standpoint of a reasonably prudent layperson. Haworth v. Jantzen, 2006 OK 35, ¶ 13, 172 P.3d 193, 196. With these principles in mind, we turn to the Policy at issue. ¶11 Nation focuses its argument for business interruption coverage mainly on the "Perils Covered" general conditions of the Policy, arguing that the scope of coverage for its losses is against "all risk of direct physical loss or damage."6 An "all-risk policy" does not extend coverage to every conceivable loss. An insured has the initial burden to show the loss is a covered loss under an all-risk policy, not just that it suffered a fortuitous loss. Okla. Schs. Risk Mgmt. Trust v. McAlester Pub. Schs., 2019 OK 3, ¶ 16, 457 P.3d 997, 1002. The Court must read the Policy's "Perils Covered" provision in connection with the Policy as a whole. The Policy insures "all property of every description both real and personal" of the insured.7 Nation contracted for coverage limited to loss or damage to its tangible (real and personal) property. ¶12 The "Perils Covered" provision must also be read in connection with the business interruption provision, under which Nation seeks coverage for its economic losses. The business interruption provision states in pertinent part: Subject to the terms, conditions and exclusions stated elsewhere herein, this Policy provides coverage for: A. COVERAGE 1. BUSINESS INTERRUPTION Against loss resulting directly from interruption of business, services or rental value caused by direct physical loss or damage, as covered by this Policy to real and/or personal property insured by this Policy, occurring during the term of this Policy.8 ¶13 The plain language of the policy covers only those business interruption losses caused by "direct physical loss or damage . . . to real and/or personal property." The Policy does not define "direct physical loss or damage." However, policy language is not ambiguous simply because the policy fails to define a term. Cranfill v. Aetna Life Ins. Co., 2002 OK 26, ¶ 7, 49 P.3d 703, 706. Our Court has relied on dictionary definitions to provide the common, ordinary usage of terms. See, e.g., U.S. Fid. & Guar. Co. v. Briscoe, 1951 OK 386, ¶ 10, 239 P.2d 754, 757. A common dictionary is helpful here. Direct: "proceeding from one point to another in time or space without deviation or interruption" and "stemming immediately from a source."9 Physical: "having material existence," and "of or relating to material things," and "natural; tangible concrete."10 Loss: "destruction or ruin" and "failure to keep possession: deprivation."11 Damage: "loss or harm resulting from injury."12 ¶14 The common usage of the term "damage" is a lesser harm than "loss." However, both "loss" and "damage" to property under the Policy must be "physical," which means "material" or "tangible." See Ascent Hospitality Mgmt. Co. v. Emp'rs Ins. Co. of Wausau, 537 F. SupP.3d 1282, 1287 (N.D. Ala. 2021). ¶15 Synthesizing these definitions, "direct physical loss or damage . . . to real and/or personal property" is the immediate and actual, material, or tangible deprivation or destruction of property. See Goodwill Indus. of Cent. Okla., Inc. v. Phila. Indem. Ins. Co., 21 F.4th 704, 710-11 (10th Cir. 2021) (applying Oklahoma law) (holding a "direct physical loss" requires immediate and perceptible destruction or deprivation of property); Govinda, LLC, 545 F. SupP.3d at 1172 (applying Oklahoma law) (holding a "direct physical loss" results from an actual or material deprivation of the plaintiff's property). In other words, the Policy covers only those business interruption losses caused by actual tangible deprivation or destruction of property. The definition of "direct physical loss or damage . . . to real and/or personal property" precludes those intangible losses involving detrimental economic impact unaccompanied by a "distinct, demonstrable, physical damage to property." See, e.g., Diesel Barbershop, LLC v. State Farm Lloyds, 479 F. SupP.3d 353, 360 (W.D. Tex. 2020). To adopt Nation's interpretation of "direct physical loss or damage" would render the term "physical" meaningless. Govinda, LLC, 545 F. SupP.3d at 117. ¶16 Nearly all jurisdictions deciding this issue in the context of COVID-19 business interruption claims have found that "direct physical loss or damage" is not ambiguous and upheld almost identical interpretations of the phrase.13 Nation contends that these cases interpreting similar phrases to "physical loss or damage" are distinguishable from this matter because the policies at issue in those cases utilized Insurance Services Office (ISO)14 language that is different from the language found in the Policy. However, that contention is incorrect. The phrase "direct physical loss or damage" is almost identical to the phrases used in the ISO policies' business interruption provisions. Even more, the ISO policies do not define those similar phrases. Courts interpreting similar phrases used dictionary definitions of each of the words "physical," "loss," and "damage." And the courts concluded that "physical loss or damage" requires tangible damage, rather than just loss of use. ¶17 The Policy's "period of restoration" provision also supports that business interruption coverage requires actual, tangible deprivation or destruction of property. Under the Policy, Insurers only pay for business interruption losses during the "period of restoration," which is the time period where the "direct physical loss or damage" is rebuilt, repaired, or replaced.15 We must read the Policy's requirement of "direct physical loss or damage . . . to real and/or personal property" for business interruption coverage together with the "period of restoration" provision. This results in only one conclusion--"direct physical loss or damage" requires the physical act of rebuilding, repairing, or replacing damaged or lost property. See Goodwill Indus. of Cent. Okla., Inc., 21 F.4th at 711 (holding that the policy covered only "direct physical loss of or damage to" property that could be remedied by the physical acts of repairing, rebuilding, or replacing the affected property); Govinda, LLC, 545 F. SupP.3d at 1173-74 (holding that the "period of restoration" provision reinforced the conclusion that the policy covered only tangible damage or loss). ¶18 To satisfy the rebuilding, repairing, or replacement requirement of the business interruption provision, the district court held that Nation "repaired" its properties by implementing various COVID-19 mitigation protocols and modifications, such as installing acrylic barriers and sanitation stations, staggering seating and gaming machines, and replacing air filters. We reject this conclusion. Other jurisdictions have held that cleaning or employing minor remediation or preventative measures to decrease the spread of COVID-19 does not constitute direct physical damage or loss of property. See, e.g., L&J Mattson's Co. v. Cincinnati Ins. Co., 536 F. SupP.3d 307, 315 n.3 (N.D. Ill. 2021) (holding that additions such as plexiglass, hand sanitizer, air purifiers, or improved HVAC systems "do not constitute repairs to damaged property where a plaintiff has not alleged actual damage to property" but "constitute improvements to stop the spread of virus from one person to another"); Café La Trova LLC v. Aspen Specialty Ins. Co., 519 F. SupP.3d 1167, 1182 (S.D. Fla. 2021) (holding that the "rearranging of furniture and installation of partitions cannot 'reasonably be described as repairing, rebuilding, or replacing'" and cannot constitute "the very 'damage' the plaintiff now asserts is sufficient to invoke coverage"); Independence Rest. Grp. v. Certain Underwriters at Lloyd's, London, 513 F. SupP.3d 525, 534-35 (E.D. Pa. 2021) (ruling that moving equipment and adding plexiglass to make the property "functional and reasonably safe for patrons" cannot reasonably be described as repairing, rebuilding, or replacing). We follow those jurisdictions and conclude Nation's implementations constitute measures to stop the spread of the virus from one person to another, not repairs to or replacement of damaged or lost property. ¶19 Even more, Nation admitted that its own "preemptive" actions triggered the business interruption at issue instead of demonstrating a physical loss or damage to its property. It voluntarily closed its businesses to prevent harm to its property; it was not forced to close due to contamination of the virus or by any emergency order regarding COVID-19. Under the district court's expansive approach, a business could unilaterally decide to close its business for a myriad of reasons and recover under a business interruption provision without proving any physical loss or damage. Such an approach is an unreasonable expansion of the Policy's business interruption coverage. ¶20 The phrase "direct physical loss or damage . . . to real and/or personal property" is not ambiguous, and Insurers' proffered interpretation that the Policy covers those business interruption losses caused by actual tangible deprivation or destruction of property is the only reasonable one. Nation does not allege or present any evidence that its property was tangibly damaged, whether in part or in full. The Policy does not cover this loss.16 CONCLUSION ¶21 Nation did not contract for coverage for its alleged losses. Instead, it contracted for business interruption coverage based on a tangible loss or damage to property. Nation does not present any evidence that its property was tangibly damaged or destroyed but only that it chose to temporarily not use its properties. This Court cannot rewrite the Policy and expand coverage for losses that fall outside the plain and unambiguous terms of the insurance contract. Nation's alleged losses are not covered under the Policy's business interruption provision, and the district court erred in finding coverage when Nation did not sustain actual, tangible deprivation or damage to property. DISTRICT COURT'S JUDGMENT REVERSED AND REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. Darby, C.J., Kane, V.C.J., Winchester, Rowe, and Kuehn, JJ., and Prince, S.J., concur. Edmondson (by separate writing), Combs, and Gurich, JJ., dissent. Kauger, J., disqualified. FOOTNOTES 1 The parties filed a Stipulation of Dismissal without Prejudice as to AXA/XL America, Inc. on August 10, 2020. 2 The district court entered an order dismissing without prejudice Underwriters at Lloyd's London on October 23, 2020. 3 This Court noted in its March 7, 2022 Order that "Chubb Bermuda Ltd." was listed in the case style in the Petition in Error filed by "Chubb Bermuda International" and that counsel filed an Entry of Appearance on behalf of "Chubb Bermuda International." The Court granted the motion to associate counsel filed by Chubb Bermuda International, noting that the Court granted the motion with no finding, conclusion, or adjudication by this Court on whether "Chubb Bermuda Ltd." or "Chubb Bermuda International" is a proper party in this matter. 4 Cherokee Nation is a Native American tribe, headquartered in Tahlequah, Oklahoma. Cherokee Nation Businesses, LLC, is a tribal limited liability company whose sole member is the Cherokee Nation. Cherokee Nation Entertainment, LLC is a tribal limited liability company whose sole member is the Cherokee Nation Businesses, LLC, wholly owned by the Cherokee Nation. 5 The term Insurers includes all Appellants in this matter. Each Insurer issued a separate policy to Nation with unique endorsements and exclusions. However, each separate policy utilizes the same Tribal First Policy Wording, Tribal Property Insurance Program USA Form 15, subject to those endorsements and exclusions. 6 ROA, Doc. 14, Nation's First Mot. for Partial Summ. J. on Bus. Interruption Coverage, Ex. 5, Tribal First Policy Wording 24, Aug. 17, 2020. 7 Section II of the Policy regarding property damage states in pertinent part: A. COVERAGE Subject to the terms, conditions and exclusions hereinafter contained, this Policy insures all property of every description both real and personal (including improvements, betterments and remodeling), of the Named Insured or property of others in the care, custody or control of the Named Insured, for which the Named Insured is liable or under obligation to insure. ROA, Doc. 14, Nation's First Mot. for Partial Summ. J. on Bus. Interruption Coverage, Ex. 5, Tribal First Policy Wording 9, Aug. 17, 2020. 8 ROA, Doc. 14, Nation's First Mot. for Partial Summ. J. on Bus. Interruption Coverage, Ex. 5, Tribal First Policy Wording 19, Aug. 17, 2020. 9 Direct, Meriam-Webster.Com Dictionary (2022), available at www.merriam-webster.com/dictionary/direct. 10 Physical, Meriam-Webster.Com Dictionary (2022), available at www.merriam-webster.com/dictionary/physical; Physical, Oxford English Dictionary Online (3d ed. 2021), available at www.oed.com. 11 See Goodwill Indus. of Cent. Okla., Inc. v. Phila. Indem. Ins. Co., 21 F.4th 704, 710 (10th Cir. 2021); see also Loss, Meriam-Webster.Com Dictionary (2022), available at www.merriam-webster.com/dictionary/loss. 12 Damage, Meriam-Webster.Com Dictionary (2022), available at www.merriam-webster.com/dictionary/damage. 13 See SAS Int'l, Ltd. v. Gen. Star Indem. Co., No. 12-1219, --- F.4th ---, 2022 WL 1818115 (1st Cir. 2022) (concluding "direct physical loss" requires physical damage, rather than just mere loss of use, under Massachusetts law);10012 Holdings, Inc. v. Sentinel Ins. Co., 21 F.4th 216 (2d. Cir. 2021) (same, under New York law); Uncork & Create LLC v. Cincinnati Ins. Co., 27 F.4th 926 (4th Cir. 2022) (same, under West Virginia law); Q Clothier New Orleans, LLC v. Twin City Fire Ins. Co., 29 F.4th 252 (5th Cir. 2022) (same, under Louisiana law); Terry Black's Barbecue, L.L.C. v. State Auto. Mut. Ins. Co., 22 F.4th 450 (5th Cir. 2022) (same, under Texas law); Estes v. Cincinnati Ins. Co., 23 F.4th 695 (6th Cir. 2022) (same, under Kentucky law); Brown Jug, Inc. v. Cincinnati Ins. Co., 27 F.4th 398 (6th Cir. 2022) (same, under Michigan law); Santo's Italian Café LLC v. Acuity Ins. Co., 15 F.4th 398 (6th Cir. 2021) (same, under Ohio law); Sandy Point Dental, P.C. v. Cincinnati Ins. Co., 20 F.4th 327 (7th Cir. 2021) (same, under Illinois law); Paradigm Care & Enrichment Ctr., LLC v. W. Bend Mut. Ins. Co., 33 F.4th 417 (7th Cir. 2022) (same, under Wisconsin law); Planet Sub Holdings, Inc. v. State Auto Prop. & Cas. Ins. Co., --- F.4th ---, 2022 WL 1951615 (8th Cir. 2022) (same, under Kansas, Missouri, and Oklahoma law); Monday Rests. v. Intrepid Ins. Co., 32 F.4th 656 (8th Cir. 2022) (same, under Missouri law); Oral Surgeons, P.C. v. Cincinnati Ins. Co., 2 F.4th 1141 (8th Cir. 2021) (same, under Iowa law); Mudpie, Inc. v. Travelers Cas. Ins. Co. of Am., 15 F.4th 885 (9th Cir. 2021) (same, under California law); Goodwill Indus. of Cent. Okla., Inc., 21 F.4th at 710-12 (10th Cir. 2021) (same, under Oklahoma law); SA Palm Beach, LLC v. Certain Underwriters at Lloyd's London, 32 F.4th 1347 (11th Cir. 2022) (same, under Florida law); Henry's La. Grill, Inc. v. Allied Ins. Co. of Am., --- F.4th ---, 2022 WL 1815874 (11th Cir. 2022) (same, under Georgia law); Ascent Hospitality Mgmt. Co., 537 F. SupP.3d at 1287 (N.D. Ala. 2021) (concluding that both loss or damage to property must be physical, under Alabama law); Pappy's Barber Shops, Inc. v. Farmers Grp., Inc., 487 F. SupP.3d 937 (S.D. Cal. 2020) (rejecting insureds' argument that direct physical loss does not require tangible damage and holding physical loss or damage occurs only when property undergoes a "distinct, demonstrable, physical alteration," under California law); Lisette Enter., Ltd. v. Regent Ins. Co., 537 F. SupP.3d 1038 (S.D. Iowa 2021) (holding the restaurant that was closed to in-person dining during the pandemic failed to allege a tangible loss or alteration of property for coverage under business income provision, under Iowa law); United Talent Agency v. Vigilant Ins. Co., 293 Cal. Rptr. 3d 65 (Ct. App. 2022) (holding allegations of loss of use of insured premises were insufficient to establish "direct physical loss or damage," under California law); Commodore, Inc. v. Certain Underwriters of Lloyd's London, --- So. 3d ---, 2022 WL 1481776 (Fla. Dist. Ct. App. May 11, 2022) (under Florida law); Sweet Berry Café, Inc. v. Society Ins., Inc., 2022 IL App (2d) 210088, --- N.E.3d --- (App. Ct. Mar. 15, 2022) (under Illinois law); Ind. Repertory Theatre v. Cincinnati Cas. Co., 180 N.E.3d 403 (Ind. Ct. App. 2022) (holding policy did not provide coverage because the theater did not suffer physical loss or damage, under Indiana law); Jesse's Embers, LLC v. W. Agric. Ins. Co., 973 N.W.2d 507 (Iowa 2022) (under Iowa law); GPL Enter., LLC v. Certain Underwriters at Lloyds, No. 302, --- A.3d ---, 2022 WL 1638787 (Md. Ct. Spec. App. 2022) (holding term "physical" clearly indicated that the damage must affect the property itself, under Maryland law); Verveine Corp. v. Strathmore Ins. Co., 184 N.E.3d 1266 (Mass. 2022) (concluding that "direct physical loss of or damage to" property requires some "distinct, demonstrable, physical alteration of the property," under Massachusetts law); MAC Prop. Grp. LLC v. Selective Fire & Cas. Ins. Co., No. A-0714-20, --- A.3d ---, 2022 WL 2196396 (N.J. Super. Ct. App. Div. 2022) (under New Jersey law); Consol. Rest. Operations, Inc. v. Westport Ins. Corp., 167 N.Y.S.3d 15 (N.Y. App. Div. 2021) (under New York law); North State Deli, LLC v. Cincinnati Ins. Co., --- S.E.2d ---, 2022 WL 2432157 (N.C. Ct. App. 2022) (under North Carolina law); Nail Nook, Inc. v. Hiscox Ins. Co., 182 N.E.3d 356 (Ohio Ct. App. 2021) (under Ohio law); Sullivan Mgmt., LLC v. Fireman's Fund Ins. Co., No. 2021-001209, --- S.E.2d ---, 2022 WL 3221920 (S.C. 2022) (under South Carolina law) ("Because neither the presence of the coronavirus nor the government order prohibiting indoor dining constitutes 'direct physical loss or damage,' the policy's triggering language is not met."); Hill & Stout, PLLC v. Mut. of Enumclaw Ins. Co., 515 P.3d ---, 2022 WL 3651805 (Wash. 2022) (under Washington law) Colectivo Coffee Roasters, Inc. v. Soc'y Ins., 975 N.W.2d 442 (Wis. 2022) (under Wisconsin law); see also Abbey Hotel Acquisition, LLC v. Nat'l Sur. Corp., No. 21-2609, 2022 WL 1697198 (2d Cir. May 27, 2022) (summ. order) (unpublished) (under Florida law); Bel Air Auto Auction, Inc. v. Great N. Ins. Co., No. 21-1493, 2022 WL 2128586 (4th Cir. June 14, 2022) (per curiam) (unpublished) (under Maryland law); Summit Hospitality Grp., Ltd. v. Cincinnati Ins. Co., No. 21-1362, 2022 WL 2072759 (4th Cir. June 9, 2022) (per curiam) (unpublished) (under North Carolina law); Glen R. Edwards, Inc. v. Travelers Cas. Ins., No. 21-3035, 2022 WL 1510818 (8th Cir. May 13, 2022) (per curiam) (unpublished) (under Missouri law); United Hebrew Congregation of St. Louis v. Selective Ins. Co. of Am., No. 21-2752, 2022 WL 1013984 (8th Cir. Apr. 5, 2022) (per curiam) (unpublished) (under Missouri law); Circus Circus LV, LP v. AIG Specialty Ins. Co., No. 21-15367, 2022 WL 1125663 (9th Cir. Apr. 15, 2022) (mem.) (unpublished) (under Nevada law); Levy Ad Grp., Inc. v. Fed. Ins. Co., No. 21-15413, 2022 WL 816927 (9th Cir. Mar. 17, 2022) (mem.) (unpublished) (under Nevada law); Gilreath Fam. & Cosm. Dentistry, Inc. v. Cincinnati Ins. Co., No. 21-11046, 2021 WL 3870697 (11th Cir. Aug. 31, 2021) (per curium) (unpublished) (holding that neither the state's shelter in place orders nor any alleged COVID-19 particles in the air caused physical damage necessary to recover under the policy, under Georgia law); 10E, LLC v. Travelers Indem. Co. of Connecticut, No. 2:20-cv-04418-SVW-AS, 2020 WL 5359653 (C.D. Cal. Sept. 2, 2020) (summ. ord.) (unpublished) (holding physical loss or damage occurs only when property undergoes a distinct, demonstrable, physical alteration and detrimental economic impact does not suffice, under California law); Malaube, LLC v. Greenwood Ins. Co., No. 20-22615-CIV-Williams/Torres, 2020 WL 5051581 (S.D. Fla. Aug. 26, 2020) (summ. ord.) (unpublished) (explaining a direct physical loss contemplates an actual change in insured property causing it to become unsatisfactory for future use or requiring that repairs be made, under Florida law); Turek Enter., Inc. v. State Farm Mut. Auto. Ins. Co., No. 20-11655, 2020 WL 5258484 (E.D. Mich. Sept. 3, 2020) (summ. ord.) (unpublished) (holding direct physical loss requires a plaintiff to demonstrate some tangible damage to property, under Michigan law); Del. Valley Mgmt., LLC v. Cont'l. Cas. Co., No. 2:20-cv-4309, 2021 WL 5235277 (E.D. Pa. Nov. 10, 2021) (mem.) (unpublished) (concluding that insureds' partial loss of use of their facilities did not constitute physical damage or loss, under Pennsylvania law); Rose's 1, LLC v. Erie Ins. Exch., No. 2020 CA 002424 B, 2020 WL 4589206 (D.C. Super. Ct. Aug. 6, 2020) (sum. ord.) (unpublished) (holding the words "direct" and "physical" modify the word "loss" and "direct physical loss" requires a "direct physical intrusion on to the insured property," under D.C. law); Gavrilides Mgmt. Co., LLC v. Mich. Ins. Co., No. 354418, 2022 WL 301555 (Mich. Ct. App. February 1, 2022) (per curiam) (unpublished) (holding insureds did not suffer "direct physical loss of or damage to property" as a result of government shutdown orders during COVID-19, under Michigan law); Four Roses, LLC v. First Prot. Ins. Co., No. COA21-427, 2022 WL 2813270 (N.C. Ct. App. July 19, 2022) (unpublished); Crescent Hotels & Resorts, LLC v. Zurich Am. Ins. Co., No. 211074, slip op. at 1 (Va. Apr. 14, 2022) (refusing to review a lower court's dismissal of a policyholder's COVID-related business interruption claim because, "[u]pon review of the record in this case and consideration of the argument submitted in support of and in opposition to the granting of appeal, the court is of the opinion there is no reversible error in the judgment complained of"), available at https://www.phelps.com/a/web/nRzydP9Xk3qBCa2LVUittC/1484000-1484340-order.pdf. 14 ISO is a national insurance policy drafting organization that develops standard policy forms. See Colony Ins. Co. v. Jackson, No. 09-CV-780-TCK-TLW, 2011 WL 2118728, at * 3 (N.D. Okla. May 27, 2011) (unpublished). 15 Section III of Policy states that a business interruption loss is paid "during the period of restoration," which is defined as follows: A. COVERAGE . . . 5. PERIOD OF RESTORATION The period during which business interruption and or rental interruption applies will begin on the date direct physical loss occurs and interrupts normal business operations and ends on the date that the damaged property should have been repaired, rebuilt or replaced with due diligence and dispatch, but not limited by the expiration of this policy. ROA, Nation's First Mot. for Partial Summ. J. on Bus. Interruption Coverage, Ex. 5, Tribal First Policy Wording 23, Aug. 17, 2020. 16 We do not address the excess Insurers' exclusions because Nation cannot demonstrate that its claim triggers coverage under the Policy. Lexington Insurance Company provided the primary layer of insurance. The other Insurers provide excess coverage under their policies that cannot be triggered until the insurance at the primary level has been exhausted. Steadfast Ins. Co. v. Agric. Ins. Co., 2013 OK 63, ¶ 12, 304 P.3d 747, 750. Edmondson, J., with whom Combs and Gurich, JJ., join dissenting: ¶1 January 2020 saw a novel coronavirus become a global pandemic, the worst health crisis in a century. On March 15, the Governor declared a state of emergency and nonessential businesses were ordered to close. The greatest shock to our economy since the Great Depression was underway. By January 2021, four hundred thousand Americans had died of COVID-19, more than twenty-four million infected. Within a few days of the Governor's order, the Nation closed its businesses for remodeling and repairs to implement public health measures; then it submitted a claim under its 2019 business interruption insurance policy. The claim was denied. The day after suit was filed the primary insurer added an exclusion to the policy to bar any claim based on imminent health hazards. ¶2 Before today's decision, an all risk business interruption insurance policy -- lacking a definition or exclusion to the contrary -- would provide coverage, as the District Court held.1 ¶3 Noting the disjunctive phrasing of loss or damage, it would have been logical to reason they have different meanings. To find that "physical loss" means "physical damage" would render one term or the other redundant. ¶4 To consult Merriam-Webster -- a useful fountain of ambiguities -- interpretations of "loss" other than physical damage are discoverable in a variety of contexts: disadvantage, deprivation, missing, captured, unavailable, unusable, to name a few. An example given in Webster's New World Dictionary, Third College Edition of American English, Simon and Schuster (1988), is "so as to lose money (to operate a business at a loss). ¶5 Examining the whole policy to discern the meaning of any disputed part is standard. However, Lexington's "Period of Restoration" clause which provides what it will cover should not dictate what it will not cover. ¶6 Uncertainty existing where language employed is capable of more than one meaning, thus rendering the policy patently ambiguous, the Nation then takes the burden and is entitled to show its expectation of coverage is reasonable.2 That issue was raised by the Nation in response to Lexington's motion for partial summary judgment, but was reserved for later along with several other defenses, as noted by the District Court. ¶7 Supposedly, a first impression case is before us, and so it is, at least in the heat of a pandemic (the likelihood of which Lloyds has been warning the insurance industry since 2008 in Pandemic: Potential Insurance Impacts, stating as noted by the District Court that business interruption coverage needed to be carefully drafted by carriers because a "pandemic is inevitable"). And the great mass of post-COVID federal cases cited by the majority constitutes the present majority opinion of other jurisdictions. ¶8 While these points are conceded, I respectfully dissent to the conclusions that the policy in this case is unambiguous and non-coverage of the Nation's claim is the only reasonable interpretation. These conclusions effectively give the armor of a named perils policy to an all risks policy which is devoid of pertinent definitions and exclusions, and convert a business interruption insurance policy into nothing more than fire insurance. ¶9 At the very least, the remand should be clear that the Nation be given a full opportunity to present its defenses. FOOTNOTES 1 In Western Fire Ins. Co. v. First Presbyterian Church, 165 Colo. 34, 437 P.2d 52 (1968), the insured/church was deprived of their property when the fire department, a regulatory authority, closed its facilities due to risk of harm and danger from contamination by gasoline fumes around and infiltration of the property. Insurance company denied coverage urging that there was no "direct physical loss" because the church building had not been permanently damaged and had no tangible damage. The court disagreed, and found unequivocally that the church suffered a direct loss of its property when the fire marshal closed the church for the safety and well-being of the community, meeting its burden to establish coverage; See also, Se. Mental Health Ctr., Inc. v. Pac. Ins. Co., 439 F. Supp. 2d 831, 838 (W.D. Tenn. 2006) ("direct physical damage" in an all-risk policy includes "loss of use" as well as "loss of access" under business interruption coverage); Burdett Oxygen Co. of Cleveland, Inc. v. Employers Surplus Lines Ins. Co., 419 F.2d 247 (6th Cir. 1969) (when interpreting an insurance policy "the language of the parties should be given its plain and ordinary meaning); The Phoenix Ins. Co. v. Infogroup, Inc., 147 F. SupP.3d 815, 830 (S.D. Iowa 2015) ("'loss" is defined as the 'act of losing possession,' or 'an instance of losing.'" Merriam Webster, available at http://www.merriam-webster.com/dictionary/loss. Therefore a 'loss' denotes the deprivation of something of value or being unable to possess the item of value."); (business interruption coverage can be triggered without tangible structural harm to property; "direct physical loss or damage" is established if the property is unusable to the policy holder): See, Schlamm, Stone & Dolan LLP v. Seneca Ins. Co., 800 N.Y.S.2d 356 (Sup. Ct. 2005) (losses caused by noxious particles post 9/11 World Trade Center disaster constitute "direct physical loss or damage" and are covered); Am. All. Ins. Co. v. Keleket X-Ray Corp., 248 F.2d 920, 925 (6th Cir. 1957) (contamination with radioactive dust and radon gas and removal process to decontaminate was similar to fire restoration and a covered event under business interruption coverage); Azalea, Ltd. v. Am. States Ins. Co., 656 So. 2d 600, 602 (Fla. Dist. Ct. App. 1995) (release of unknown substance in sewage treatment plant destroying bacteria colony causing plant shutdowns constituted "direct damage to the structure" constituting "direct physical loss" to the sewage treatment facility); (physical damage does not have to be permanent to trigger coverage, imminent threat of physical loss or damage is sufficient): See, Sloan v. Phoenix of Hartford Ins. Co., 207 N.W.2d 434, 437, (Ct. App. Mich. 1973) (loss of use due to government shutdown in response to impending riots is covered even though no direct damage to property); Hampton Foods, Inc. v. Aetna Cas. & Sur. Co., 787 F.2d 349, 352 (8th Cir. 1986) (coverage arises with imminent threat of loss and established by evacuation from an imminent building collapse); Port. Auth. v. Affiliated FM Ins. Co., 311 F.3d 226, 236 (3d Cir. 2002) (imminent threat of release of asbestos fibers was sufficient to establish a loss and find coverage). 2 See Crown Energy Co. v. Mid-Continent Casualty Co., 2022 OK 60, ¶ 14, 511 P.3d 1064, 1070.

92dc6eac-d3bb-47ff-b1cd-418feeaaf4b4

Nichols v. Ziriax

oklahoma

Oklahoma Supreme Court

NICHOLS v. ZIRIAX2022 OK 76Case Number: 120646Decided: 09/21/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MICHELLE TILLEY NICHOLS and MICHELLE JONES, Petitioners, v. PAUL ZIRIAX, Secretary of the Oklahoma State Election Board; TOM MONTGOMERY, Chairman of the Oklahoma State Election Board; TIM MAULDIN, Vice Chairman of the Oklahoma State Election Board; HEATHER MAHIEU CLINE, Member of the Oklahoma State Election Board; JERRY BUCHANAN, Alternate Member of the Oklahoma State Election Board; DEBI THOMPSON, Alternate Member of the Oklahoma State Election Board; and THE HONORABLE J. KEVIN STITT, Governor of Oklahoma, Respondents. APPLICATION TO ASSUME ORIGINAL JURISDICTION AND PETITION FOR WRIT OF MANDAMUS ¶0 Petitioners are the proponents of Initiative Petition No. 434, State Question No. 820 (hereinafter "SQ820"), which in simple terms would legalize, regulate, and tax marijuana that is recreationally used by adults through the enactment of new laws to be codified at title 63, sections 431 through 446 of the Oklahoma Statutes. Petitioners ask this Court to assume original jurisdiction and to issue a writ of mandamus that would require Respondents to print SQ820 on the ballot for the general election being held November 8, 2022. At the time Petitioners filed their petition for an emergency writ on August 22nd, this Court had not even certified the number of signatures on SQ820's initiative petitions as numerically sufficient pursuant to 34 O.S.2021, § 8(H). That was not accomplished until August 25th. But beyond that, before SQ820 could be placed on the ballot, it would still need to clear several other statutorily imposed hurdles set forth in the general provisions of title 34 of the Oklahoma Statutes. Chiefly, SQ820 would still need to survive any citizen protests challenging the sufficiency of the signatures or the rewritten ballot title. See 34 O.S.2021, § 8(I), (K). Because it was not clear whether any protests would be filed or, if some were filed, whether the protests could be disposed of prior to the deadlines for printing ballots and for mailing ballots to absentee voters, this Court decided on August 29th to assume original jurisdiction and hold this matter in abeyance so that the process could play out a little further. The Secretary of State took actions on August 31st that commenced the 10-business-day period to file protests. Prior to the September 15th deadline, citizens filed four protests. This Court denied two of the protests on September 16th. Now that it is clear SQ820 cannot be printed on ballots in time to comply with the deadline for mailing ballots to absentee voters that is set forth in 26 O.S.2021, § 14-118(A) and 52 U.S.C. § 20302(a)(8)(A), we deny the requested writ of mandamus. ORIGINAL JURISDICTION PREVIOUSLY ASSUMED; WRIT OF MANDAMUS DENIED. Melanie Wilson Rughani, CROWE & DUNLEVY, Oklahoma City, Oklahoma, for Petitioners. Zach West, Solicitor General, and Thomas R. Schneider, Deputy General Counsel, OFFICE OF ATTORNEY GENERAL, Oklahoma City, Oklahoma, for Respondents. Denise Lawson, GLENN COFFEE & ASSOCIATES, PLLC, Oklahoma City, Oklahoma, for Amici Curiae, State Chamber Research Foundation Legal Center, the Oklahoma Farm Bureau Legal Foundation, and the Oklahoma Cattleman's Association. COMBS, J.: FACTUAL BACKGROUND ¶1 On January 4, 2022, Petitioners Michelle Tilley Nichols and Michelle Jones filed Initiative Petition No. 434, State Question No. 820, which if approved by voters would legalize, regulate, and tax marijuana used recreationally by adults through the enactment of new law to be codified at title 63, sections 431 through 446 of the Oklahoma Statutes. After an unsuccessful constitutional challenge to the measure, see In re State Question No. 820, Initiative Petition No. 434, 2022 OK 30, 507 P.3d 1251 (decided Mar. 28, 2022), Petitioners began gathering signatures on May 3rd. Petitioners had 90 days in which to gather signatures under 34 O.S.2021, § 8(E)--or until August 1st--but they completed that process nearly one month early. On July 5th, Petitioners delivered 118 boxes of signature pamphlets (on special paper required by the Secretary of State's vendor) to the Secretary of State for "a verification and count of the number of signatures on the petitions" in compliance with 34 O.S.2021, § 6.1(A).1 ¶2 This is the first general election year in which the Secretary of State has been tasked with the verification of signatures on initiative petitions. Previously, section 6.1 only required the Secretary of State to "make or cause to be made a physical count of the number of signatures on the petitions," see 34 O.S.2011, § 6.1(A) (amended 2020); but in 2020 the Legislature amended section 6.1 to require the Secretary of State to "make or cause to be made a verification and physical count of the number of signatures on the petitions," see Act of May 21, 2020, ch. 125, sec. 7, § 6.1(A), 2020 Okla. Sess. Laws 451, 454 (codified at 34 O.S.2021, § 6.1(A)). The new legislation specifies that this new verification duty requires the Secretary of State to match at least three of six data points required on the signature sheet--such as the voter's first name, last name, zip code, house number, or numerical month and day of his or her birth--with that voter's registration records on file with the Oklahoma State Election Board. See id. secs. 2, 7, §§ 2(A)--(B), 6.1(A)(8), 2020 Okla. Sess. Laws at 452--53, 455 (codified at 34 O.S.2021, §§ 2(A)--(B), 6.1(A)(8)). If the Secretary of State could not verify a signature in this manner, he could not include the signature in the total count. See id. sec. 7, § 6.1(A)(8), 2020 Okla. Sess. Laws at 455 (codified at 34 O.S.2021, § 6.1(A)(8)). The new legislation also allows the Secretary of State to purchase "any tangible or intangible assets, including, but not limited to, software, necessary to carry out" the duties of counting and verifying signatures. See id. sec. 7, § 6.1(C), 2020 Okla. Sess. Laws at 455 (codified at 34 O.S.2021, § 6.1(C)). ¶3 With their early start for counting signatures, Petitioners were hopeful they could get SQ820 on the November 2022 general election ballot. When Petitioners dropped off their signature pamphlets, the Secretary of State's Office advised them that the counting and verification process would likely take two to three weeks--which was historically how long it had taken to manually count signatures--or that the process may be even faster due to the new electronic counting process that would be conducted by the Secretary of State's vendor, Western Petition Systems (hereinafter "WPS"), on its newly created software. Pet'rs' App., tab C, Nichols Aff. ¶ 8, at 2. In order to facilitate the process, Petitioners met with the Secretary of State's Office to ensure the signature sheets were formatted and printed correctly so that the signature pages would scan through the WPS machines as expected. Id. ¶ 9, at 2. ¶4 Nevertheless, the initiative petition process got bogged down in the Secretary of State's Office. Petitioners, who had a campaign representative on site each day to observe the counting and verification process, claim that most of the work still had to be performed by individuals doing manual data entry because the scan of signature sheets using WPS software frequently generated "wildly inaccurate" digital text. Id. ¶¶ 12, 18, at 2--3. Consequently, most signature sheets had to be looked at individually so that names, addresses, and other data points could be corrected through manually typing them into the WPS program. Id. ¶ 18, at 3. Moreover, WPS is a small local business owned and operated by Bill Shapard, a political pollster, and his company could only supply four employees--who happen to be his family members--to lead the electronic verification process. See id. ¶ 14, at 2. Quickly it became obvious that the team was processing only 1,000 signature sheets per day, and there were approximately 23,000 signature sheets to process. See id. ¶ 20, at 3. That meant the process would take at least four-and-a-half weeks for data input. Petitioners offered volunteers to enter data and suggested acquiring more machines or working past 5 o'clock in order to speed up the process, but the Secretary of State refused these measures. Id. ¶¶ 20, 22, at 3. Instead, the Secretary of State hired and trained numerous temporary workers and reallocated some of his full-time staff. See Resp'ts' Resp. ex. A, Bingman Aff. ¶¶ 11 & n.1, 18, at 3--4. Petitioners also suggested speeding up the count by seeing if they had met the 95,000-signature threshold without processing all the signature sheets, but they were told no interim reports could be run because, with how the software was designed, the signatures could not be verified until the very end, after all the signature sheets had been processed. See id. ¶¶ 12--16, at 3--4; Pet'rs' App., tab C, ¶¶ 21--22, at 3. Ultimately, the signature and verification process did not conclude until August 17th, after nearly seven weeks. ¶5 On August 10, 2022, Respondent Paul Ziriax advised Petitioner Michelle Tilley Nichols that the State Election Board had an "internal" deadline of August 26th for printing the November 2022 general election ballots and that there would be no wiggle room with that self-imposed deadline. See Pet'rs' App., tab C, Nichols Aff. ¶ 23, at 4. Mr. Ziriax also informed Ms. Tilley Nichols that he would not be printing SQ820 on the November 2022 general election ballot unless he received a proclamation from the Governor by August 26th authorizing SQ820 to be placed on the ballot in compliance with 34 O.S.2021, § 12. Id.; see also Pet'rs' App., tab D, Letter from Paul Ziriax, Okla. State Election Bd., to Kevin Stitt, Governor of Okla., 1 (June 22, 2022) ("Monday, August 29, 2022, is technically the statutory deadline to call a State Question election for the November 8 General Election. (However, as a practical matter the State Election Board needs to receive an executive proclamation no later than 5:00 p.m. on Friday, August 26, 2022, which is when county election boards must certify the results of the Runoff Primary elections.) This 'practical deadline' ensures that county election boards have time to prepare ballots to meet the 45-day deadline to send absentee ballots to military voters."). ¶6 On August 22nd, Petitioners filed this action, asking this Court to assume original jurisdiction and to issue a writ of mandamus requiring the Respondents to take all necessary actions that would ensure SQ820 makes it on the November 2022 general election ballot. Petitioners argue that Article V, Section 3 of the Oklahoma Constitution mandates that all elections on measures referred to the people "shall be had at the next election held throughout the state, except when the Legislature or the Governor shall order a special election for the express purpose of making such reference." Okla. Const. art. V, § 3 (emphasis added). In an attempt to bolster the initial mandatory language and to avoid the subsequent qualifying language, Petitioners point us to case law interpreting Article V, Section 3--namely, Allen v. Burkhart, 1962 OK 279, 377 P.2d 821. ¶7 Despite Petitioners' insistence that mandate should issue, Respondents have pointed out several statutory provisions that must be complied with before SQ820 can be put on the ballot. As of August 22nd, the Secretary of State had not certified to this Court the numerical sufficiency of the signatures he reviewed pursuant to 34 O.S.2021, § 8(H). Nor had this Court found the signatures in support of SQ820 to be numerically sufficient pursuant to section 8(H). After that, the Secretary of State would still be required to publish a notice pursuant to section 8(I) of the numerical sufficiency of the signatures in support of SQ820, of the rewritten ballot title, and of the period for filing protests and objections. That notice would commence a 10-business-day period for citizens to file protests and objections with this Court pursuant to section 8(I). If any protests got filed, this Court would be tasked with "resolv[ing] the objection with dispatch." Id. § 8(K). Once "all objections or protests have been resolved or the period for filing such has expired, the Secretary of State shall, in writing, notify the Governor." Id. § 12. Finally, upon notification, "the Governor . . . shall issue a proclamation setting forth the substance of the measure and the date on which the vote will be held." Id. ¶8 Before the Court reviewed the matter, the Secretary of State filed on August 22nd a notice with this Court certifying a total number of 117,257 verified signatures, which satisfied the requirements of Article V, Section 3 of the Oklahoma Constitution. See Sec'y of State's Certification to the Sup. Ct. of Okla. of the Signature Count of Initiative Pet. 434, State Question 820 ¶ 5, at 1, In re Initiative Pet. 434, State Question 820, No. 120,641 (Okla. filed Aug. 22, 2022). By order dated August 25th, this Court found the signatures in support of SQ820 to be numerically sufficient and directed the Secretary of State to comply with the notice requirements in 34 O.S.2021, § 8(I). Order 1--2, In re Initiative Pet. 434, State Question 820, No. 120,641 (Okla. Aug. 25, 2022). ¶9 The parties made oral presentations to a Supreme Court Referee on August 26th, at which point the matter was submitted for consideration of the merits. Because there were still several statutory requirements to be met, this Court was not ready to assume original jurisdiction and issue the requested writ of mandamus. But because there was still the potential to comply with the remaining statutory requirements in time to get SQ820 on the November 2022 general election ballot, this Court was not yet willing to deny the requested writ of mandamus. So long as the statutory requirements in 34 O.S.2021, §§ 8 and 12 could be met in time to comply with the statutory mandates in 26 O.S.2021, § 14-118(A) and 52 U.S.C. § 20302(a)(8)(A) to mail absentee ballots not less than forty-five (45) days preceding the election, SQ820 could make it on the November ballot. So this Court decided the process needed more time to play out, and entered an order on August 30th that assumed original jurisdiction and held this matter "in abeyance because the time period for filing objections to either signatures or the ballot title has not yet expired." Order 1. ¶10 The process has practically played out at this point. The Secretary of State published the notice required by section 8(I) in three newspapers of statewide circulation on Wednesday, August 31st. See Okla. Sec'y of State's Proof of Publ'n 1, In re Initiative Pet. 434, State Question 820, No. 120,641 (Okla. filed Sept. 1, 2022). Accordingly, citizens had 10 business days--or until September 15th (accounting for Labor Day)--to file an objection to the ballot title or signature count. 34 O.S.2021, § 8(I). Four such protests were filed: (1) Paul Tay v. Michelle Diane Tilley Nichols and Michelle Jones, No. 120,657 (Okla. filed Aug. 29, 2022); (2) Michael D. Reynolds, as resident taxpayer and voter of the State of Oklahoma v. Brian Bingman, Oklahoma Secretary of State, in his Official Capacity, No. 120,680 (Okla. filed Sept. 7, 2022); (3) John Stotts, Karma Robinson, and Mary Chris Barth v. Michelle Diane Tilley Nichols and Michelle Anne Jones, No. 120,698 (Okla. filed Sept. 14, 2022); and (4) Jed Green, Oklahomans for Responsible Cannabis Action, v. Hon. John O'Connor, Attorney General of Oklahoma, No. 120,702 (Okla. Sept. 15, 2022). The Court denied relief in Tay and Reynolds on September 16th; and having shortened the time allowed for rehearing, this Court denied rehearing in Reynolds today. Today, the Court also denied the relief requested in Stotts and approved the Attorney General's rewritten ballot title, with the possibility of rehearing coming to a close at noon on Monday, September 26th. Lastly, the Court denied all relief requested in Green, with the possibility of rehearing coming to a close at noon on Monday, September 26th. With the statutory process winding down, the Court is now ready to address the merits of Petitioner's petition for writ of mandamus. ANALYSIS ¶11 In order to obtain a writ of mandamus, Petitioners must show: (1) that they have a clear right to the relief sought, (2) that Respondents have a plain legal duty regarding the relief sought, (3) that Respondents refuse to perform that duty, (4) that the duty does not involve discretion, and (5) that Petitioners have no plain and adequate remedy in the ordinary course of the law. Maree v. Neuwirth, 2016 OK 62, ¶ 6, 374 P.3d 750, 752--53. In this case, Petitioners petition for a writ of mandamus must be denied because Petitioners cannot show that they have a clear right to get SQ820 on the November 2022 general election ballot, that Respondents have a plain legal duty to put SQ820 on that ballot, or that Respondent's duty to place SQ820 on the ballot does not involve some discretion. ¶12 Petitioners request is grounded in Article V, Section 3 of the Oklahoma Constitution. That measure states, in full: § 3. Petitions - Veto power - Elections - Time of taking effect - Style of bills - Duty of legislature. Referendum petitions shall be filed with the Secretary of State not more than ninety (90) days after the final adjournment of the session of the Legislature which passed the bill on which the referendum is demanded. The veto power of the Governor shall not extend to measures voted on by the people. All elections on measures referred to the people of the state shall be had at the next election held throughout the state, except when the Legislature or the Governor shall order a special election for the express purpose of making such reference. Any measure referred to the people by the initiative or referendum shall take effect and be in force when it shall have been approved by a majority of the votes cast thereon and not otherwise. The style of all bills shall be: "Be it Enacted By the People of the State of Oklahoma." Petitions and orders for the initiative and for the referendum shall be filed with the Secretary of State and addressed to the Governor of the state, who shall submit the same to the people. The Legislature shall make suitable provisions for carrying into effect the provisions of this article. Okla. Const. art. V, § 3 (emphasis added). Under the plain language of this provision, it is not clear that Petitioners have a right to put SQ820 on the ballot "at the next election held throughout the state." After all, the provision gives both the Legislature and the Governor the discretion to "order a special election for the express purpose of making such reference." But to avoid the force of the plain language, Petitioners point this Court to its own case law interpreting Article V, Section 3. Specifically, Petitioners point to language in Allen v. Burkhart, 1962 OK 279, 377 P.2d 821, stating that "a special election upon an initiated measure may be called by the Governor only for a date prior to the general election, at which time otherwise the submission becomes mandatory by operation of law and 'with or without any act on the part of the Governor', provided same is ready for submission." Allen, 1962 OK 279, ¶ 40, 377 P.2d at 827. Thus, according to Petitioners, Article V, Section 3 imposes a mandatory and nondiscretionary duty on the State Election Board to place SQ820 on the ballot that should not be subject to amendment by statute, slow-walking the process, or political tinkering. ¶13 But as Respondents point out, Article V, Section 3 authorizes the Legislature to "make suitable provisions for carrying into effect" its provisions. The Legislature has done so by enacting Title 34, a statutory framework that sets forth the requirements and time frames for the initiative process. Title 34, section 25 states in relevant part: Whenever any measure shall be initiated by the people in the manner provided by law, . . . same shall be submitted to the people for their approval or rejection at the next regular election; provided, the Governor shall have power, in his discretion, to call a special election to vote upon such questions, or to designate the mandatory primary election as a special election for such purpose. 34 O.S.2021, § 25 (emphasis added). Thus, prior to being submitted at the next regular election, SQ820 must be initiated by the people "in the manner provided by law." That includes compliance with the process set forth 34 O.S.2021, §§ 8 and 12. Moreover, as Allen v. Burkhart makes clear, submission at the general election only becomes mandatory "provided [the initiated measure] is ready for submission." Thus, Petitioners have no clear legal right and Respondents have no plain legal duty to put SQ820 on the November 8, 2022 general election ballot unless it is in full compliance with 34 O.S.2021, §§ 8 and 12. ¶14 At this point in time, SQ820 is not in full compliance. There is still a possibility of rehearing in two of the protests, which prevents this Court from fully resolving those objections in compliance with 34 O.S.2021, § 8(K). That, in turn, prevents the Secretary of State and the Governor from taking their final steps in compliance with 34 O.S.2021, § 12. ¶15 The statutory process cannot guarantee the availability of a particular election, as there are many factors to be considered--not the least of which is the verification and count of signatures and the opportunity for protest. Petitioners diligently prepared SQ820 for submission on the November 2022 general election ballot. Any delays to the process were caused by the Secretary of State's "learning curve" associated with use of the new software and by the filing of four statutorily allowed protests. See Resp'ts' Resp. ex. A, Bingman Aff. ¶ 7, at 2 (stating that the utilization of modern technology to verify and count signatures for the first time "required a learning curve to which the [Secretary of State's] Office adapted throughout the verification and counting process"). ¶16 In conclusion, there is no way to mandate the inclusion of SQ820 on the November 2022 general election ballot. Thus, Petitioner's petition for writ of mandamus commanding the State Election Board to prepare and submit SQ820 to the people for their approval or rejection at the general election being held November 8, 2022, is hereby denied. ¶17 SQ820 will be voted upon by the people of Oklahoma, albeit either at the next general election following November 8, 2022, or at a special election set by the Governor or the Legislature. Okla. Const. art. V, § 3 ORIGINAL JURISDICTION PREVIOUSLY ASSUMED; WRIT OF MANDAMUS DENIED. DARBY, C.J.; KANE, V.C.J.; and KAUGER, WINCHESTER (by separate writing), EDMONDSON, COMBS, GURICH, and KUEHN, JJ., concur. ROWE, J. (by separate writing), concurs in part and dissents in part. FOOTNOTES 1 In order to advance, Petitioners needed the signatures of "eight per centum of the legal voters" whose "votes [were] cast at the last general election for the Office of Governor." Okla. Const. art. V, § 2. Because 1,186,385 votes were cast in the 2018 general election for governor, Petitioners needed 94,911 signatures to proceed. Order 1, In re Initiative Pet. 434, State Question 820, No. 120,641 (Okla. Aug. 25, 2022) WINCHESTER, J., concurring specially: ¶1 Today, September 21, 2022, this Court has approved the ballot title for Initiative Petition No. 434, State Question 820, known as Recreational Marijuana, and denied the Petitioners' requested writ of mandamus. On August 25, 2022, more than 70 days before the upcoming election, Mr. Paul Ziriax, Secretary of the Oklahoma State Election Board, filed his affidavit with the Supreme Court advising the Court of the ballot preparation process that must be accomplished by September 23, 2022, in order to comply with federal and state military and overseas voters laws. See Uniformed and Overseas Citizens Absentee Voting Act of 1986 ("UOCAVA"), 52 U.S.C. §§ 20301 to 20311, as amended by the Military and Overseas Voter Empowerment Act, Pub L. No. 111-84, Subtitle H, §§ 575- 589, 123 Stat. 2190, 2318-2335 (2009) ("MOVE Act"); and Oklahoma's Uniform Military and Overseas Voters Act, 26 O.S. 2021, §§ 14-136 to 14-155 (collectively, the Acts). ¶2 Among his responsibilities as the Secretary of the State Election Board, Mr. Ziriax has the duty to comply with both Acts. For members of the United States Armed Forces requesting absentee ballots for the November 8, 2022, general election, the Acts require the transmission of such ballots by September 23, 2022, forty-five days prior to the election date. See 52 U.S.C. § 20302(a)(8)(A) (requiring absentee ballots be sent to absent uniformed service voters and overseas voters forty-five days before the election); and 26 O.S.2021, § 14-118 (A) (absentee ballot requests for military and overseas voters that are received at least forty-five (45) days before the election, shall be transmitted not less than forty-five (45) days preceding the election date). Protecting military members and overseas Oklahoma voters is of paramount importance, and a high priority of the United States Congress and the Oklahoma Legislature. Mr. Ziriax asserts transmitting those ballots in an untimely manner is not an option and the September 23, 2022, deadline cannot be ignored. ¶3 In his affidavit, Mr. Ziriax emphasizes: "It should be noted that for security reasons, races and questions cannot be added to or deleted from an election database once it (the database) has been created. Any changes required to be made to an election database requires all the work associated with the database (including ballot proofing, testing, and printing) to be scrapped. Everything must start over from scratch. There are seventy-seven such databases that must be completed (one for each county) to conduct the General Election." Any deviation from this process puts Oklahoma in the possible position of jeopardizing the receipt of the votes of our service members. ¶4 I cannot disenfranchise our military, the very people who are working to protect and preserve our right to vote. I agree with the denial of Petitioners' request for the state question to be included on the November 8, 2022 ballot. State Question 820 can be rescheduled for another date. ROWE, J., concurring in part, dissenting in part: ¶1 I concur with the majority that the requested writ of mandamus should be denied. I respectfully dissent, however, to the majority's suggestion that this process needed "more time to play out."1 ¶2 In my view, the Petition for Writ of Mandamus was dead on arrival. It was filed on August 22, 2022, only seven (7) days before the internal deadline noted by Secretary Ziriax for the State Question to be printed on the November ballot. At that point, there was not sufficient time--10 business days--for the public to file objections to the numerical sufficiency of the signatures or the rewritten ballot title, much less to complete the rest of statutory process for placing SQ 820 on the November ballot. FOOTNOTES 1 Majority Opinion, ¶ 9.

396531b4-4cb4-40e5-8460-3cde69b5a6ca

Ghoussoub v. Yammine

oklahoma

Oklahoma Supreme Court

GHOUSSOUB v. YAMMINE2022 OK 64Case Number: 118944Decided: 06/21/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ROLAND BOU DALHA GHOUSSOUB, Petitioner/Appellee, v. MARIE CHARLES YAMMINE, a/k/a MARY YAMINE or Mary Yammine, Respondent/Appellant, and RELIASTAR LIFE INSURANCE COMPANY, Respondent. APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY Honorable Kurt Glassco, Trial Judge ¶0 Appellant Marie Yammine, as former wife and primary beneficiary of a two million dollar life insurance policy issued by Respondent ReliaStar Life Insurance Company to her former husband, Dr. Jean Bernard, appeals a declaratory judgment finding the contingent beneficiary, Appellee Roland Ghoussoub, is entitled to the policy's death benefit. Dr. Jean Bernard died after the trial court granted the parties' divorce but prior to final judgment on all issues. The trial court declared Marie Yammine and Dr. Jean Bernard were divorced and that 15 O.S.2011 § 178(A) operated to revoke her beneficiary designation to the death benefits. We reverse the trial court's judgment and remand the matter for further proceedings consistent with this opinion. APPEAL PREVIOUSLY RETAINED; TRIAL COURT'S JUDGMENT REVERSED; REMANDED FOR FURTHER PROCEEDINGS. Jody R. Nathan, FRANDEN, FARRIS, QUILLIN, GOODNIGHT & ROBERTS, Tulsa, Oklahoma, and Benjamin C. Faulkner, Sapulpa, Oklahoma, for Appellant, R. Jack Freeman, LEVINSON, SMITH & HUFFMAN, P.C., Tulsa, Oklahoma, for Appellee. OPINION ROWE, J.: ¶1 This Court in Alexander v. Alexander1 approved the procedure commonly used in marriage dissolution actions in which district courts grant a divorce and retain jurisdiction over property division or other issues for later determination. We retained this appeal to address a question of first impression -- whether Oklahoma's revocation-upon-divorce statute, 15 O.S.2011 § 178(A), applies when one party dies after the granting of the divorce but prior to final judgment on all issues. I. BACKGROUND ¶2 Dr. Jean Bernard ("Bernard") and Marie Yammine ("Yammine") were married in 2003 in the Maronite Church in Lebanon, and later in an Oklahoma civil ceremony. On June 5, 2007, ReliaStar issued "Jean J. Bernard" a two million dollar term life insurance policy on his life effective June 12, 2007 (Policy), for which he designated Yammine the sole primary beneficiary and his brother, Roland Ghoussoub ("Ghoussoub"), the contingent beneficiary. ¶3 Following the spouses' separation in 2010, after which Yammine moved to Lebanon with their two minor children, Bernard filed in 2015 to annul their ecclesiastical marriage in Lebanon and to dissolve their civil marriage in Tulsa County District Court. Yammine filed a counterclaim in the dissolution proceeding, seeking an equitable share of their property and an order requiring Bernard to maintain life insurance to secure his child support obligation during the children's minority. ¶4 In March 2017 when Bernard learned he was terminally ill, he moved for an order to dissolve the marriage and to bifurcate and reserve final judgment on all issues pursuant to Alexander. The hearing on his motion was set for mid-May 2017. ¶5 Prior to hearing, Bernard unilaterally, and without court approval, changed the primary beneficiary on the Policy to "Julien Boudhia 50% & Nisrine Masrouha 50%," effective March 31, 2017. On or about April 1, 2017, Bernard was found in a coma and hospitalized in critical condition. Two days later, his counsel filed an emergency ex parte motion for divorce alleging Bernard's death was imminent and seeking an immediate divorce to prevent Yammine from inheriting from Bernard's estate. At the hearing held the same day, the trial court granted the divorce order over Yammine's objection, reserving final judgment on property and debt issues. Yammine timely appealed the Order Granting Divorce. ¶6 Bernard was transported to Lebanon in a vegetative state in May 2017, pursuant to a guardianship order of the District Court of Tulsa County. The next month, Yammine applied for injunctive relief alleging Bernard violated the automatic temporary injunction ("ATI") mandated by 43 O.S.2011 § 110(A)(1)(b)(4)2 when he removed her beneficiary designation from the policy. She alleged indirect contempt was not an option due to Bernard's medical state and relocation to Lebanon. Claiming their marital properties in the U.S. were "being tapped" for his medical expenses, Yammine also requested to be reinstated as the Policy's primary beneficiary to protect her equitable share of the marital property. Bernard's counsel objected, arguing that the ATI dissolved when the divorce was pronounced and that the trial court lacked jurisdiction to issue orders during Yammine's appeal from the Order Granting Divorce. ¶7 By order filed October 5, 2017, the trial court, pursuant to Okla.Sup.Ct.R. 1.37(a)(5),3 enjoined Bernard's removal of Yammine as Policy beneficiary, finding his "changes were in violation of the [ATI]" and ordering restoration of the Policy's original beneficiaries. ¶8 On November 22, 2017, Yammine moved to dismiss her appeal of the Order Granting Divorce. Bernard died in Lebanon on December 14, 2018. At the time of his death, Yammine was the primary beneficiary and Ghoussoub was the contingent beneficiary of the Policy. Six weeks later, Ghoussoub filed this declaratory judgment action against Yammine and ReliaStar in Tulsa County District Court.4 ReliaStar's motion to interplead the Policy's death benefit proceeds in the declaratory judgment action was granted. ¶9 The trial court declared Ghoussoub was entitled to the Policy proceeds finding the Order Granting Divorce was final before Bernard's death and that Yammine was precluded by operation of 15 O.S.2011 § 178(A) from receiving the proceeds of the death benefit of the Policy. Yammine timely appealed the judgment. On this Court's own motion, the matter was retained for disposition. II. STANDARD OF REVIEW ¶10 Under the Declaratory Judgments Act, the determination of a competent court is reviewable in the same manner as other judgments. 12 O.S.2011 § 1654. A declaratory judgment action requires an actual controversy. 12 O.S.2011 § 1651. The controversy must be "between parties having opposing interests, which interests must be direct and substantial," and the matter must involve "an actual, as distinguished from a possible, potential or contingent dispute." Knight ex rel. Ellis v. Miller, 2008 OK 81, ¶ 8, 195 P.3d 372, 374 (quoting Gordon v. Followell, 1964 OK 74, 391 P.2d 242, 242-243). ¶11 A declaratory judgment action "pursuant to § 1651 is neither strictly legal nor equitable, but assumes the nature of the controversy at issue." Macy v. Oklahoma City School Dist. No. 89, 1998 OK 58, ¶ 11, 961 P.2d 804, 807. The declaratory action and relief sought here involves opposing claims of named beneficiaries to the proceeds of a life insurance policy. This requires statutory interpretation and application to facts arising from a marriage dissolution proceeding between the policy-owner and the primary beneficiary. Legal questions "involving statutory interpretation [are] reviewed de novo, i.e., by a non-deferential, plenary and independent examination of the trial court's legal ruling." Cole v. Josie, 2019 OK 39, ¶ 3, 457 P.3d 1007, 1009. III. DISCUSSION A. Statutory History. Effective November 1, 1987, the Legislature enacted 15 O.S. § 178.5 At issue here, § 178 addresses several types of written contracts, e.g., life insurance and retirement benefits, for which contracted death benefits are paid directly to a designated beneficiary upon death of the insured. The statute provides for revocation of all contract provisions in favor of a former spouse, subject to six exceptions. ¶13 In 1994, the Legislature amended § 178(A) to add "depository agreements" and "security registrations" to its list of written contracts with death benefits provisions subject to revocation. The same year, the statutes related to those contracts, e.g. "Payable on Death" (P.O.D.) accounts, were amended to make each expressly subject to 15 O.S. § 178.6 In 2001, the Legislature enacted 18 O.S. § 381.39a to address P.O.D. joint accounts in a savings and loan association and also made them subject to § 178. See 18 O.S.2011 § 381.39a(B)(5). ¶14 In 2012, the majority rule in the U.S. continued to support that divorce per se does not affect a designated ex-spouse's right to receive life insurance proceeds; eight states, including Oklahoma, represented the minority position that a divorce automatically revokes an ex-spouse's beneficiary status.7 By 2018, twenty-six states had adopted revocation-on-divorce laws.8 B. Appellate arguments. ¶15 Both parties agree § 178(A)'s language is clear, unambiguous and intelligible on its face. Nevertheless, Yammine argues a latent ambiguity arises when subsection A is applied to the existing facts.9 She asserts the Legislature contemplated but one final divorce in which all issues are adjudicated, but did not make its intent clear when drafting § 178(A). Yammine posits interpreting § 178(A) to include a divorce order that reserves final judgment on all issues deprives the divorce court of its opportunity to sit in equity and divests its retained jurisdiction. ¶16 To support her position, Yammine contends § 178(A) does not address the hybrid Oklahoma circumstance of a bifurcated divorce proceeding that this Court approved in Alexander: It is common for district courts to grant a divorce at one point in time but then reserve jurisdiction to address other pending issues--such as division of property or determinations as to custody or child support--at a later date. See e.g., Barnett v. Barnett, 1996 OK 60, ¶ 2, 917 P.2d 473, 475; Hibbard v. Hibbard, 1952 OK 273, ¶ 4, 247 P.2d 504, 505 ("This court has repeatedly held that an action for divorce and for division of jointly acquired property presents two causes of action maintainable separately . . . . "). 2015 OK 52, ¶ 15, 357 P.3d at 485. Although conceding the court's divorce order is procedurally consistent with Alexander, Yammine argues § 178(A) does not apply when a spouse dies after the divorce order is entered but prior to final judgment on all issues. ¶17 Ghoussoub argues § 178(A)'s plain verbiage makes no such distinction between a divorce decree on all issues and one that has been bifurcated from other issues, such as property division, as permitted by Alexander. Pointing out "property interests" and "divorce proceeding" are absent from § 178(A)'s terms, he asserts Yammine's interpretation nullifies the established legal principles pronounced in Alexander. Relying on the parties' stipulation that Yammine and Bernard were divorced when he died, Ghoussoub argues § 178(A) revokes Yammine's primary beneficiary status by operation of law. ¶18 "[L]egislative intent is to be first sought in the language of the statute and when that intent is plainly expressed so that the meaning of the statute is clear . . . there is no room for judicial construction and the statute must be followed without further inquiry." McNeill v. City of Tulsa, 1998 OK 2, ¶ 9, 953 P.2d 329, 332. The test for ambiguity in a statute is whether the language is susceptible to more than one reasonable interpretation. In re J.L.M., 2005 OK 15, ¶ 5, 109 P.3d 336, 338. Whether a statute is ambiguous is a question of law. Id. Rules of statutory construction are employed only when legislative intent cannot be ascertained from the language of a statute, as in cases of ambiguity or conflict with other statutes. Corr v. Smith, 2008 OK 12, ¶ 21,178 P.3d 859, 864. ¶19 When interpreting statutes, we do not limit our consideration to a single word or phrase. McNeill, 1998 OK 2, ¶ 11, 953 P.2d at 332. "Words used in a part of a statute must be interpreted in light of their context and understood in a sense that harmonizes with all other parts of the statute." In re Estate of Little Bear, 1995 OK 134, ¶ 22, 909 P.2d 42, 50. ¶20 Section 178(A) provides: If, after entering into a written contract in which a beneficiary is designated or provision is made for the payment of any death benefit (including life insurance contracts, annuities, retirement arrangements, compensation agreements, depository agreements, security registrations, and other contracts designating a beneficiary of any right, property, or money in the form of a death benefit), the party to the contract with the power to designate the beneficiary or to make provision for payment of any death benefit dies after being divorced from the person designated as the beneficiary or named to receive such death benefit, all provisions in the contract in favor of the decedent's former spouse are thereby revoked. Annulment of the marriage shall have the same effect as a divorce. In the event of either divorce or annulment, the decedent's former spouse shall be treated for all purposes under the contract as having predeceased the decedent.10 (Emphasis added). ¶21 The plain meaning of § 178(A)'s terms reveals an irreconcilable conflict when read in conjunction with 43 O.S.2011 § 110(C). Section 110(C) provides: C. Any temporary orders and the automatic temporary injunction, or specific terms thereof, may be vacated or modified prior to or in conjunction with a final decree on a showing by either party of facts necessary for vacation or modification. Temporary orders and the automatic temporary injunction terminate when the final judgment on all issues, except attorney fees and costs, is rendered or when the action is dismissed. The court may reserve jurisdiction to rule on an application for a contempt citation for a violation of a temporary order or the automatic temporary injunction which is filed any time prior to the time the temporary order or injunction terminates. (Emphasis added). C. 15 O.S. § 178(A) Must Be Read In Pari Materia With 43 O.S. § 110(C). ¶22 "Different statutes on the same subject are generally to be viewed as in pari materia and must be construed as a harmonious whole." Taylor v. State Farm Fire & Cas. Co., 1999 OK 44, ¶ 19, 981 P.2d 1253, 1261. "All legislative enactments in pari materia are to be interpreted together as forming a single body of law that will fit into a coherent symmetry of legislation." Id. ¶23 Prior to 2002, the parties to a dissolution proceeding could request the trial court issue a temporary order to restrain the disposition of any property and provide other injunctive relief proper under the circumstances. See 43 O.S.2001 § 110(A)(1)(a)-(g). In 2002, the Legislature amended § 110(A)(1) to add an automatic temporary injunction (ATI) that is effective against both parties when the petition for dissolution, summons, and notice of the ATI is personally served on the respondent, unless waived by the parties. See 43 O.S.Supp.2002 § 110(A)(1). When § 110(A) is satisfied, the ATI "shall become an order of the court." 43 O.S.2011 § 110(A)(5). Yammine and Bernard did not waive the ATI. ¶24 The ATI expressly restrains both parties from "changing or in any manner altering the beneficiary designation on any life insurance policies on the life of either party or any of their children." 43 O.S.2011 § 110(A)(1)(b)(4). Other ATI provisions specifically restrain the spouses' post-petition interactions with several contracts that are subject to revocation pursuant to § 178(A). Pertinent here, § 110(C) provides that "[t]emporary orders and the [ATI] terminate when the final judgment on all issues, except attorney fees and costs, is rendered or when the action is dismissed." (Emphasis added). ¶25 The ATI mandated by § 110--and the temporary order entered by the trial court at Yammine's request--govern the life insurance policy at issue here. While Ghoussoub claims the Policy's beneficiary was revoked by § 178(A), his position fails to consider § 178(A)'s conflict with § 110(C), which was enacted fifteen years after § 178(A). Read alone, § 178(A)'s application to a divorce order with pending property division issues, including a life insurance policy, is unclear. In contrast, § 110(C) very clearly maintains the trial court's control of beneficiary changes to a life insurance policy owned by the parties until final judgment on all issues is rendered. "[W]here a matter is addressed by two statutes--one specific and the other general--the specific statute, which clearly includes the matter in controversy and prescribes a different rule, governs over the general statute." Rogers v. Quiktrip Corp., 2010 OK 3, ¶ 13, 230 P.3d 853, 860. In addition, "[m]ore recently-enacted legislation controls over earlier provisions." Id. Accordingly, we find the specific language in § 110(C) controls over § 178(A) in this cause. ¶26 "The Legislature is not presumed to have done a vain or useless act in the promulgation of a statute." Comer v. Preferred Risk Mut. Ins. Co., 1999 OK 86, ¶ 18, 991 P.2d 1006, 1014. "The function of the Legislature is to prescribe rules to operate upon the actions and rights of citizens in the future." (Emphasis added). Starkey v. Okla. Dep't of Corr., 2013 OK 43, ¶ 26, 305 P.3d 1004, 1015. ¶27 Reading the two statutes in pari materia, we can only conclude the later enactment of § 110(C) effectively limits § 178(A)'s "after being divorced" language to a divorce where final judgment on all issues is rendered. To find otherwise creates an absurd result wherein one's designation as a life insurance beneficiary, while protected by § 110(C) in a bifurcated proceeding where final judgment has yet to be rendered, is concurrently revoked by § 178(A). IV. CONCLUSION ¶28 Section 178(A) requires a final judgment on all issues. The trial court erred by interpreting 15 O.S.2011 § 178(A) to revoke Yammine's beneficiary designation in Bernard's life insurance policy based on an order granting divorce when the final judgment on all issues remained pending at husband's death. The trial court's declaratory judgment is reversed, and this cause is remanded for further proceedings consistent with this opinion. APPEAL PREVIOUSLY RETAINED; TRIAL COURT'S JUDGMENT REVERSED; REMANDED FOR FURTHER PROCEEDINGS. Darby, C.J., Kauger, Edmondson, Gurich and Rowe, JJ., concur. Kane, V.C.J. (by separate writing), Winchester and Combs, J.J. (by separate writing), dissent. Kuehn, J., not participating. FOOTNOTES 1 2015 OK 52, 357 P.3d 481. The trial court in Alexander granted the spouses a divorce, ordered mediation for the property division issues, and memorialized the findings in a court minute. The wife died before a settlement was reached or a journal entry had been filed. The trial court granted the husband's motion to dismiss the divorce action, arguing it abated when the wife died and deprived the court of jurisdiction. We reversed, first holding the divorce granted to the spouses was enforceable when pronounced. After approving the procedure in dissolution actions during which the trial court bifurcates the issues, grants the divorce and retains jurisdiction over reserved property division and other issues for later hearing, we ordered the case to proceed for determination of the property division issues. 2 Section 110(A)(1)(b)(4) restrains the parties from "changing or in any manner altering the beneficiary designation on any life insurance policies on the life of either party or any of their children." 3 In relevant part, Okla.Sup.Ct.R. 1.37(a)(5) states "[A]fter a petition-in-error is filed, the trial court retains jurisdiction in... matrimonial litigation ... to issue orders affecting ... the property of the parties pending the appeal." 4 A week later, Yammine filed a petition for letters of administration, appointment of personal representative, determination of heirs, and appointment of a special administrator in Tulsa County District Court. Premised on the final Order Granting Divorce, the probate court subsequently determined Yammine was not Bernard's surviving spouse and that their two minor children were his only heirs at law. Ghoussoub and Bernard's sister applied for appointment as co-personal representatives of Bernard's estate, in which they claimed Bernard died intestate and he was divorced from Yammine. 5 Other revocation on divorce statutes enacted the same year are not discussed as they are not at issue in this cause and are unaffected by our holding. 6 See 6 O.S.2011 § 901(B)(10) ("Payable on Death" (P.O.D.) bank accounts); 6 O.S.2011 § 2025(A)(10) (credit union share and deposit accounts); 71 O.S.2011 §§ 907 and 908(B) ("Transfer on Death" (T.O.D.) securities). 7 Kristen P. Raymond, Double Trouble -- An Ex-Spouse's Life Insurance Beneficiary Status & State Automatic Revocation Upon Divorce Statutes: Who Gets What?,19 Conn. Ins. L.J. 399, 407 (2012-2013). Michigan, Colorado, Minnesota, Missouri, Ohio, Arizona and Texas had adopted the minority rule, either by statute or judicial mandate. Id. at 411-12. 8 See Sveen v. Melin, 138 S. Ct. 1815, 1819 n.1, 201 L. Ed. 2d 180 (2018). 9 A "latent ambiguity . . . arises when language is clear and intelligible and suggests but a single meaning, but some extrinsic fact or some extraneous evidence creates a necessity for interpretation or a choice between two or more possible meanings." Black's Law Dictionary (6th ed. 1979) 10 Section 178 further provides: B. Subsection A of this section shall not apply: 1. If the decree of divorce or annulment is vacated; 2. If the decedent had remarried the former spouse and was married to said spouse at the time of the decedent's death; 3. If the decree of divorce or annulment contains a provision expressing an intention contrary to subsection A of this section; 4. If the decedent makes the contract subsequent to the divorce or annulment; 5. To the extent, if any, the contract contains a provision expressing an intention contrary to subsection A of this section; or 6. If the decedent renames the former spouse as the beneficiary or as the person or persons to whom payment of a death benefit is to be made in a writing delivered to the payor of the benefit prior to the death of the decedent and subsequent to the divorce or annulment. C. For purposes of subsection A of this section, "death benefit" shall not include: 1. Any interest in property in which the decedent's former spouse has an interest as a joint tenant; or 2. Any interest in property in which the decedent's former spouse has a beneficial interest in an express trust created by the decedent during the decedent's lifetime for which provision is made in Section 175 of Title 60 [60-175] of the Oklahoma Statutes. D. This section shall apply to any contract of a decedent made and entered into on or after November 1, 1987 and to depository agreements and security registrations made and entered into on or after September 1, 1994. Subsection D originally provided "[t]his section shall apply to any contract of a decedent dying on or after November 1, 1987." The Eighth Circuit held § 178 was unconstitutional when applied to a life insurance policy purchased prior to its enactment and that revocation of the provisions in favor of the former spouse violated the Contract Clause of the U.S. Constitution. See Whirlpool v. Ritter, 929 F.2d 1318 (8th Cir. 1991). KANE, V.C.J., dissenting: ¶1 I dissent for the reasons that (1) the trial court's correction of the ATI violation did nothing to subvert the effect of the divorce granted after the violation, and (2) the trial court did not violate the ATI. THE TRIAL COURT'S CORRECTION OF THE ATI VIOLATION DID NOTHING TO SUBVERT THE EFFECT OF THE DIVORCE GRANTED AFTER THE VIOLATION ¶2 Certainly, the amendment of the insurance beneficiaries by Dr. Bernard on March 31, 2017 (before the grant of divorce) was void ab initio, by operation of 43 O.S.2011 § 110 (the ATI). In October of that year (after the divorce), the trial court remedied this violation by issuing an order directing that the beneficiaries be returned to their prior status. This act of setting aside an illegal transfer was not only proper, it was wholly necessary in order to comport with Oklahoma law. This correction of the ATI violation cannot be read as some implicit signal by the trial court that it did not really mean to later grant the divorce after the ATI had been violated. ¶3 Why would the court grant the request to void the ATI violation, if the gift to the spouse was voided by the subsequent divorce? Because the rights of people other than the former spouse were also impacted, and Oklahoma law required the Court to set aside the illegal act of Dr. Bernard. The wrongful violation of the ATI by Dr. Bernard, and the Court's subsequent correction of this act did nothing to subvert the effect of the trial court's grant of divorce to the litigants after the ATI violation. THE ACT OF THE TRIAL COURT DID NOT VIOLATE THE ATI ¶4 While the majority does an admirable job of harmonizing two seemingly conflicting statutes, the operative word in this statement is "seemingly." In fact, the statutes do not conflict in this case. It is essential that we note that the ATI is addressed exclusively to ex parte actions of the litigants in the divorce action. The statute enjoins only the parties. The statute makes requirements of only the parties. The statute restrains only the actions of the parties. The statute does nothing to restrain, limit, or enjoin the trial court. ¶5 The true effect of the grant of divorce by the trial court was to modify the ATI prior to the final conclusion of the case. The ATI statute provides: "Any temporary orders and the automatic temporary injunction, or specific terms thereof, may be vacated or modified prior to or in conjunction with a final decree on a showing by either party of facts necessary for vacation or modification." 43 O.S. § 110(C) (emphasis added). ¶6 After Dr. Bernard attempted to change his insurance provisions the wrong way (ex parte violation of the ATI), he thereafter accomplished the change the correct way--by seeking leave of the trial court. The trial court granted the contested request for early grant of divorce under our teachings in Alexander v. Alexander, 2015 OK 52, 357 P.3d 481. The divorce was granted to Dr. Bernard for the precise reason that he knew that he was dying, and he did not wish for his estranged spouse to be afforded the status of surviving spouse. This was the stated reason for the relief, and was well known to the trial court granting the divorce. The trial court did not violate the ATI or any other temporary order by granting the relief--the court merely modified the legal status of the parties, which had the effect of modifying the ATI prior to final decree, as provided in the statute. ¶7 After the legal status of the parties was modified by the trial court, and after the trial court returned the status of the insurance policy beneficiaries to the state existing prior to the ATI violation, the insurance policy then stood with the gift to the former spouse revoked, per 15 O.S.2011 § 178(A) by virtue of the grant of divorce that occurred after the ATI violation. This is the only rational and just construction of the facts and law before us in this case. ¶8 For these reason, I respectfully dissent. COMBS, J., with whom WINCHESTER, J., joins, dissenting: ¶1 I respectfully dissent. ¶2 Here the parties had a valid automatic temporary injunction (ATI) entered upon the filing of the divorce action. By the terms of 43 O.S.2011, § 110(A)(6), "[t]he automatic temporary injunction shall be dissolved upon the granting of the dissolution of marriage, final order of legal separation or other final order." Upon the trial court's grant of the divorce, the ATI was dissolved as it related to the term life insurance policy and the benefits to be paid under that policy. By virtue of the provisions of 15 O.S.2011, § 178(A), the now former wife was precluded from receiving the proceeds of the death benefit policy. I would affirm the trial court.

6c9cda05-2c82-4036-a023-28192188c709

Milne v. Hudson

oklahoma

Oklahoma Supreme Court

MILNE v. HUDSON2022 OK 84Case Number: 119498Decided: 10/25/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ANDREA SUE MILNE Plaintiff/Appellee,v.HOWARD JEFFREES HUDSON, JR., Defendant/Appellant. Appeal from the District Court of McIntosh CountyHonorable Brendon Bridges, Trial Judge ¶0 Plaintiff/Appellee Milne applied for a civil protection order against Defendant/Appellant Hudson in the District Court of McIntosh County. Hudson objected, claiming that the district court had no jurisdiction to enter the order. Hudson argued that because McIntosh County is within the boundaries of the Muscogee Reservation, Milne is a member of the Muscogee Nation, and Hudson is a member of the Cherokee Nation, the McIntosh District Court had no jurisdiction to enter a civil protective order against him. The trial court denied the objection and entered the civil protection order. We affirm the trial court's decision. APPEAL PREVIOUSLY RETAINED;ORDER OF THE DISTRICT COURT AFFIRMED Heather Cook, Norman, Oklahoma, Heather Cook P.L.L.C., for Defendant/Appellant; No appearance for Plaintiff/Appellee. KUEHN, J.: ¶1 Appellee Andrea Sue Milne dated Appellant Howard Hudson. During an argument, Hudson became violent with Milne. Milne applied to the District Court of McIntosh County for a civil protection order, as the couple dated in in Eufaula, Oklahoma. She stated in her application, and testified at a hearing, that Hudson first attacked her in a car, slamming her head into the dashboard. When they got to her house, he hit her and threw her across her yard. Finally, he pushed his way into her house, grabbed some of his belongings, and struck her in front of her children. When the children came to her aid, he absconded, but returned later and threatened to burn the house down. Milne testified that after the afternoon of violent acts, he stalked her at home, around town, and at her workplace. This application and testimony, though not tested by investigation or cross-examination, were certainly enough to justify an order of protection. ¶2 It is in this context that we approach the narrow issue presented: did the District Court of McIntosh County have jurisdiction to issue a civil protection order? ¶3 It is important to emphasize what this case is not about. We are not concerned with the enforcement of an existing protection order. We are also not concerned with any possibility of Hudson's criminal prosecution based on Milne's allegations. We focus only on whether a state district court has jurisdiction to issue a civil order, protecting an Oklahoma citizen from violence, at the citizen's request, where both parties are also citizens of sovereign Indian Nations and the violent acts occurred within the boundaries of both the State of Oklahoma and the Muscogee Nation. PROCEDURAL HISTORY ¶4 Milne filed a petition for civil protection order against Hudson with the Court Clerk of McIntosh County on October 21, 2020. The District Court issued an emergency protection order, and then, after a hearing, issued an interim order of protection and continued the evidentiary hearing to March 15, 2021. Prior to the evidentiary hearing, Hudson filed a motion to dismiss for lack of jurisdiction. The trial court heard argument on this motion, orally denied it, and filed a written order denying the motion. On March 15, the trial court also issued a final order of protection to remain in effect for five years from the date of issue. Hudson timely filed this Petition in Error, and this Court retained the appeal. Hudson filed a brief in support of his appeal on December 14, 2021. Despite direction from this Court, Milne did not file a brief in response, and the case was submitted for consideration based on the filings submitted by Hudson. STANDARD OF REVIEW ¶5 While this case involves a civil protection order, the issue is whether the district court had jurisdiction. This is a question of law, reviewed de novo; we conduct "a plenary, independent, and non-deferential examination of the trial court's rulings of law." Sheffer v. Buffalo Run Casino, PTE, Inc., 2013 OK 77, ¶ 3, 315 P.3d 359, 361; see also Mustang Production Co. v. Harrison, 94 F.3d 1382, 1384 (10th Cir. 1996) (federal courts will review tribal court's decision regarding jurisdiction in Indian Country de novo). McGIRT v. OKLAHOMA DOES NOT RESOLVE THIS CLAIM ¶6 Hudson argues the outcome of this case is determined by the decision in McGirt v. Oklahoma, 140 S. Ct. 2452 (2020). He is mistaken. While that decision sets the stage for our analysis, its outcome is not controlling. Its holding -- that the State cannot prosecute a crime committed by a tribal citizen, against a tribal citizen, in Indian Country -- cannot control the analysis or outcome of the civil-law issues raised in this case. ¶7 However, in McGirt, the United States Supreme Court held that the Muscogee Nation reservation was never disestablished and continues to be Indian Country. McGirt, 140 S. Ct. at 2468. With that finding, activity supporting the protection order in this case occurred in Indian Country; neither party disputed this fact below, and the trial court accepted it when considering the jurisdictional question. Our analysis thus focuses on the issue of civil jurisdiction in Indian Country. And we do not undertake this analysis in a vacuum. Decades of settled law, both state and federal, inform our decision. McGirt expanded the popular understanding of the extent of Indian Country in Oklahoma. This necessarily expands the law we may consider and apply in cases raising Indian Country issues. But McGirt did not itself change the applicable civil law. THE INDIAN CIVIL RIGHTS ACT DOES NOT RESOLVE THIS CLAIM ¶8 First, we address the trial court's findings. The trial court relied on a portion of the Indian Civil Rights Act of 1968, 25 U.S.C § 1304(b)(2), to deny Appellant's motion -- understandably, since the parties referred to that statute.1 At first glance, Section 1304(b)(2) appears to govern here, because it explicitly provides for the possibility of concurrent jurisdiction in domestic violence cases among tribal, state and federal courts under certain circumstances.2 However, Section 1304 provides for tribal criminal jurisdiction over domestic and dating violence. In the protective order context, Section 1304 is restricted to enforcement. It explicitly grants tribal courts authority to exercise criminal jurisdiction over violations of existing civil or criminal protection orders. 25 U.S.C. §§ 1304(a)(5), 1304(c)(2). ¶9 In relying on this statute, the trial court put the cart before the horse. The question was whether the trial court could issue a civil protection order at all. It is clear from Section 1304(b)(2) that, after an order is issued, the state district court would have had authority to enforce it. But Section 1304 does not address under what circumstances any sovereign court may issue such an order. THE DISTRICT COURT HAD JURISDICTION TO ISSUE THE CIVIL PROTECTION ORDER ¶10 Hudson primarily argues that the tribal court had jurisdiction to issue a protection order against him. We agree. Federal law clearly gives tribal courts full civil jurisdiction to issue and enforce protection orders involving any person. However, that does not resolve the issue before this Court. Hudson claims that only a tribal court could have exercised jurisdiction over him to issue a protection order. This is not the case. The Tribal Court Does Not Have Exclusive Jurisdiction ¶11 Generally speaking, and depending on the Indian status of the parties, Indian tribes have civil jurisdiction over cases occurring within Indian Country. It is well established that the federal statutory definition of Indian Country in 18 U.S.C. § 1151 applies in both civil and criminal contexts. See Alaska v. Native Village of Venetie Tribal Government, 522 U.S. 520, 527 (1998); DeCoteau v. District County Court for Tenth Judicial Dist., 420 U.S. 425, 427 n.2 (1975); Mustang, 94 F.3d at 1385. ¶12 However, this jurisdiction is not necessarily exclusive. The United States Supreme Court has observed that an "exercise of tribal power beyond what is necessary to protect tribal self-government or to control internal relations is inconsistent with the dependent status of the tribes, and so cannot survive without express congressional delegation." Montana v. U.S., 450 U.S. 544, 564 (1981). Montana was concerned with the extension of a tribe's authority over non-tribal citizens and discussed the limited nature of tribal sovereign authority in that context. Tribes may regulate the activities of nonmembers who enter consensual relationships "through commercial dealing, contracts, leases, or other arrangements" with the tribe or tribal members. Montana, 450 U.S. at 565; United States v. Cooley, 141 S. Ct. 1638, 1642-43 (2021). And tribes may exercise civil authority over the conduct of non-Indians when the "conduct threatens or has some direct effect on the political integrity, the economic security, or the health or welfare of the tribe." Montana, 405 U.S. at 565; Cooley, 141 S. Ct. at 1642-43. Where a reservation lies within state boundaries, that fact does not automatically exclude all state regulatory authority; "an Indian reservation is considered part of the territory of the State." Nevada v. Hicks, 533 U.S. 353, 361-62 (2001) (quoting U.S. Dept. of Interior, Federal Indian Law 510 and n.1 (1958)). ¶13 We recognize that the Montana test refers to tribal authority over non-Indians. However, in Lewis v. Sac and Fox Tribe of Oklahoma Housing Authority, this Court applied a very similar test to the question of state jurisdiction over disputes where both parties are Indian. Lewis v. Sac and Fox Tribe of Oklahoma Housing Authority, 1994 OK 20, 896 P.2d 503, cert. denied, 516 U.S. 975 (1995). There, the Sac and Fox Housing Authority entered into an agreement with Indian buyers to convey a fee simple estate, including mineral rights. The Sac and Fox Nation had established its Housing Authority pursuant to federal regulations.3 The Housing Authority was organized both under an authorizing state law which made it a state agency,4 and under tribal law.5 The Authority had acquired fee simple title to the property, which was in Indian Country. By agreement with the Lewises, it built their home on the property, with title passing to the Lewises after the home was paid off. However, eventually the warranty deed conveyed to the Lewises included only surface rights. The Lewises sued the Authority in state court for specific performance of the agreement, plus an accounting for oil and gas revenues. The Authority objected, claiming that the state court had no jurisdiction. ¶14 This Court disagreed. We first noted the longstanding federal policy, recognized by the United States Supreme Court, of fostering tribal autonomy and self-government. Lewis, 1994 OK 20, ¶ 8, 896 P.2d at 507-08. However, we determined that Supreme Court precedent does "not divest state courts of cognizance over all disputes among Indians. Where, as here, state law is implicated, governs the transaction and is invoked, and there is no infringement upon tribal self-government, there can be no barrier to state cognizance." Id. at ¶ 10, 896 P.2d at 508 (emphasis omitted). We concluded that, to determine whether state courts have jurisdiction where Indian interests are concerned, we must discover whether Congress has explicitly withdrawn state court jurisdiction, or whether the interest infringes on tribal self-government.6 Id. at ¶ 12, 508-09. Congress Did Not Restrict Exclusive Jurisdiction to Tribal Courts ¶15 Congress has clearly authorized tribal courts to issue civil protection orders. For purposes of this section, a court of an Indian tribe shall have full civil jurisdiction to issue and enforce protection orders involving any person, including the authority to enforce any orders through civil contempt proceedings, to exclude violators from Indian land, and to use other appropriate mechanisms, in matters arising anywhere in the Indian country of the Indian tribe (as defined in Section 1151) or otherwise within the authority of the Indian tribe. 18 U.S.C. § 2265(e). However, the plain language of this statute does not confer exclusive civil jurisdiction. Where Congress intends to give exclusive jurisdiction to federal and/or tribal courts, and to remove state jurisdiction, it has done so explicitly. 18 U.S.C. § 1153 (granting "exclusive jurisdiction" in certain Indian Country cases to tribes or the federal government).7 And where Congress has determined that tribes may consent to enter an arrangement offering concurrent state jurisdiction over cases which would normally be exclusive to tribal or federal courts, it has done so explicitly.8 ¶16 Section 2265(e) does not explicitly refer to exclusive tribal court jurisdiction. Moreover, the language does not imply exclusive jurisdiction. Rather, it includes tribal courts within the list of sovereigns which may issue civil protection orders. The statute is entitled "Full faith and credit given to protection orders", and its first clause ensures that the courts of each sovereign (tribal, federal, territory or state) will give full faith and credit to a civil or criminal protection order, no matter where it was issued. 18 U.S.C. § 2265(a). Thus, Section 2265 is not a bar to exercise of state district court jurisdiction to enter civil protection orders. The State and Tribe Have the Same Interest in Civil Protection Orders ¶17 As a rule, Oklahoma's interests and the interests of a tribal sovereign nation may run parallel but will not completely coincide. State laws and tribal laws may resemble one another, but the jurisdictions may impose different resolutions of conflict, or consequences for behavior, or procedures for redress. And, as noted above, a tribe may have exclusive civil jurisdiction, including over non-Indians, where conduct threatens its political integrity, economic security, or the health and welfare of its citizens. Cooley, 141 S. Ct. at 1643. ¶18 However, civil protection orders are different. They are individually tailored and narrowly designed with a single goal -- to protect the victim of abuse. Universally, they are recognized in sister courts no matter their court of origin. Tribal governments clearly have a strong interest in protecting their citizens from the violence, threats, stalking, harassment and other behavior which may be covered by a civil protection order. The State of Oklahoma shares those exact same interests in protecting its citizens. The conduct giving rise to civil protection orders identically threatens the health and welfare of citizens of both the Muscogee Nation and the State of Oklahoma. And each one has chosen the same legal vehicle in response. ¶19 Most importantly for our analysis, the Tribe and the State here have an identical goal: to provide each individual citizen a swift path to safety, with the combined weight of all the involved sovereigns ready to enforce it. The point of a civil protection order is the promise of immediate action on the individual's behalf. A terrified person may be trying to escape physical or sexual violence. They may be trying to go home or to work or school or church -- to go about the everyday business of living -- unmolested, without being under surveillance and disruption from a persistent stalker. They may be beset by constant, disturbing, unwelcome communications. The swiftest and surest path to aid is to find the closest avenue for legal protection. Maybe the tribal courthouse is nearby. Maybe it is in another county -- another part of the state, even -- but a county courthouse is near to hand. The most effective way to achieve the combined tribal and State goal here is to give that scared victim every option to find their swift path to safety. ¶20 Milne, the person seeking a civil protection order, is a citizen of both the State and the Muscogee Nation. And, within the geographic boundaries of both the State and the Muscogee Reservation, the Tribe's and State interests are the same. Milne needed protection from violent behavior and stalking. She went to the nearest venue of her choice as a citizen, her county courthouse, for swift relief, and it was granted. Federal law does not prohibit that grant of relief, and equity compelled its issuance. This is that instance in which the exercise of State jurisdiction does not infringe on the interests of a tribal government but serves as an additional safeguard to those interests. CONCLUSION ¶21 Our holding is narrow. As we said in Lewis, "Today's pronouncement is not to be understood as a broad declaration that all litigation of Indian rights lies within the inherent constitutional cognizance of Oklahoma state courts." Lewis, 1994 OK 20, ¶ 19, 896 P.2d at 512. Here, the Tribe's interest in its citizens' health, safety and welfare exactly coincides with the State's interests. Where jurisdiction is otherwise proper, a citizen of Oklahoma may seek a civil protection order in a tribal court or in state district court. ¶22 The Order of the District Court is affirmed. CONCUR: KANE, V.C.J., and KAUGER, WINCHESTER, EDMONDSON, COMBS (by separate writing), ROWE and KUEHN, JJ. CONCUR IN RESULT: DARBY, C.J. (by separate writing). CONCUR IN JUDGMENT: GURICH, J. (by separate writing) FOOTNOTES 1 This statute was amended, effective October 2022. The amended provisions are substantially similar or identical to the provisions discussed here. 2 "The exercise of special domestic violence criminal jurisdiction by a participating tribe shall be concurrent with the jurisdiction of the United States, of a State, or of both." 25 U.S.C. § 1304(b)(2). 3 The federal Department of Housing and Urban Development authorized Indian tribes to establish Indian Housing Authorities using a framework of either tribal or state law. 24 C.F.R. §§ 905.101--905.950 (1990). 4 63 O.S. §§ 1051 et seq. 5 Sac and Fox Housing Authority Act of 1983, Resolution SF--83--25. At the time of trial, the Authority was reorganized under tribal law but had not yet received federal approval to operate under that law, so was still operating as a state agency. 6 In reaching this conclusion, Lewis rejected previous Oklahoma case law which had held Indian nations had exclusive jurisdiction over all civil matters arising among Indian parties in Indian county, effectively overruling Housing Authority of the Seminole Nation v. Harjo, 1990 OK 35, 790 P.2d 1098, and Ahboah v. Housing Authority of Kiowa Tribe of Indians, 1983 OK 20, 660 P.2d 625. 7 See also Oklahoma v. Castro-Huerta, No. 21-429 (U.S. June 29, 2022) 597 U.S. __, 142 S. Ct. 2486 (absent explicit direction otherwise, states have concurrent jurisdiction to prosecute non-Indians for crimes committed in Indian Country). 8 25 U.S.C. §§ 1321, 1322, 1326; Public Law 280, Act of August 15, 1953, Ch. 505, 67 Stat. 588, amended by Public Law 90--284, Act of April 11, 1968, 82 Stat. 80. Public Law 280 was originally limited to six named states, not including Oklahoma. 18 U.S.C. § 1162; 28 U.S.C. 1360. Under Sections 1321 and 1322, a state not named in Public Law 280 may, with tribal consent, enact legislation to support concurrent criminal and civil jurisdiction. Oklahoma never attempted to assume jurisdiction under Public Law 280. Darby, C.J., concurring in result: ¶1 I concur with the Court's judgment, but write separately to explain my understanding of the legal framework for when an Oklahoma state district court, a court of general jurisdiction, is otherwise preempted (or ousted)1 of that authority in civil protection order cases involving Indians on a reservation.2 Federal Indian law jurisprudence requires this Court to hold that litigation arising from conduct occurring within the external boundaries of a reservation is within a district court's subject matter jurisdiction until it is determined not to be; exclusive jurisdiction with tribal courts occurs in limited circumstances. We must resolve jurisdictional challenges individually on a fact-specific, case-by-case determination.3 ¶2 In this case, Hudson, a Cherokee Indian, challenges the McIntosh County District Court's denial of his motion to dismiss; he claims that the Muscogee (Creek) Nation's Tribal District Court has exclusive jurisdiction. Because state jurisdiction is not preempted, does not infringe on the Creek Nation's right to self-government, and the exercise of tribal power is not necessary to control internal relations among members, i.e. the protective order at issue involves a member Indian and a nonmember Indian,4 the McIntosh County District Court retains subject matter jurisdiction. Fisher v. Dist. Court, 424 U.S. 382, 387, 96 S. Ct. 943, 943, 947, 47 L. Ed. 2d 106 (1976); Montana v. United States, 450 U.S. 544, 564-66, 101 S. Ct. 1245, 1257-58, 67 L. Ed. 2d 493 (1981). A review of the Muscogee (Creek) Nation Code reveals that the Nation's Tribal District Court actually has concurrent jurisdiction with the State, not exclusive jurisdiction. Muscogee (Creek) Nation Code Ann. tit. 6, §§ 3-401, 3-402 (2010).5 The McIntosh County District Court correctly denied Hudson's motion to dismiss for lack of subject matter jurisdiction. I. OKLAHOMA'S DISTRICT COURTS HAVE GENERAL SUBJECT MATTER JURISDICTION AND ARE LIMITED BY THE SUPREMACY CLAUSE OF THE U.S. CONSTITUTION. ¶3 First, we must consider the source and scope of the state district courts' subject matter jurisdiction and understand how it differs from that of the Creek Nation's Tribal District Court. Subject matter jurisdiction is the "power to deal with the general subject involved in the action" and includes the power of the court "to proceed in a case of the character presented, or power to grant the relief sought" Dutton v. City of Midwest City, 2015 OK 51, ¶ 16, 353 P.3d 532, 539 (footnotes omitted). It is primary and fundamental in every case. Pointer v. Hill, 1975 OK 73, ¶ 14, 536 P.2d 358, 361. Oklahoma district courts derive their power from the Oklahoma Constitution; they are vested with "unlimited original jurisdiction of all justiciable matters" Okla. Const. art. VII, § 7(a) (emphasis added). The adjudicatory authority of Oklahoma district courts is comprehensive and only limited by the Oklahoma Constitution6 and the U.S. Constitution. U.S. Const., amend. X. ("The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."). ¶4 When determining jurisdictional disputes for litigation arising within the external boundaries of a reservation, we must remember that Oklahoma's sovereignty does not stop at reservation borders. Castro-Huerta, 597 U.S. at ___, 142 S. Ct. at 2488. The U.S. Constitution authorizes this State to exercise jurisdiction in Indian country. Oklahoma's territory includes "Indian country." Id. at 2493.7 "Indian country is part of the State, not separate from the State. To be sure, under [the United States Supreme Court's] precedents, federal law may preempt that state jurisdiction in certain circumstances. But otherwise, as a matter of state sovereignty, a State has jurisdiction over all of its territory, including Indian country. See U.S. CONST., Amdt. 10." Id. The general rule is that Oklahoma is "'entitled to the sovereignty and jurisdiction over all the territory within her limits.'" Id. (citing Lessee of Pollard v. Hagan, 44 U.S. (3 How.) 212, 228, 11 L. Ed 565 (1845)). II. INDIAN TRIBAL NATIONS ARE NOT FULL TERRITORIAL SOVEREIGNS. ¶5 In comparison, tribal courts are not courts of general jurisdiction; they are limited. See Nevada v. Hicks, 533 U.S. 353, 367, 121 S. Ct. 2304, 2314, 150 L. Ed. 2d 398 (2001). A tribe's inherent powers extend to their internal relations. Montana, 450 U.S. at 564, 101 S. Ct. at 1257-58. Tribal nations are not full territorial sovereigns. Atkinson Trading Co. v. Shirley, 532 U.S. 645, 650, 121 S. Ct. 1825, 1831, 149 L. Ed. 2d 889 (2001). Instead they are "unique aggregations possessing attributes of sovereignty over both their members and their territory. . . . The sovereignty that the Indian tribes retain is of a unique and limited character. It exists only at the sufferance of Congress and is subject to complete defeasance." United States v. Wheeler, 435 U.S. 313, 323, 98 S. Ct. 1079, 1086, 55 L. Ed. 2d 303 (1978) superseded by statute, Department of Defense Appropriations Act, 1996, Pub. L. No. 101-511, tit. VIII, § 8077(b)-(c), 104 stat. 1856, 1892-93, as recognized in United States v. Lara, 541 U.S. 193, 124 S. Ct. 1628, 158 L. Ed. 2d 420 (2004). ¶6 It is true that tribes have lost many attributes of sovereignty, but not all. Montana, 450 U.S. at 564, 101 S. Ct. at 1257. Part of a tribe's retained inherent powers included punishing tribal offenders, determining tribal membership, regulating domestic relations among members, and prescribing rules of inheritance for members. Id. "But exercise of tribal power beyond what is necessary to protect tribal self-government or to control internal relations is inconsistent with the dependent status of the tribes, and so cannot survive without express congressional delegation." Id. (citations omitted). ¶7 In distinguishing those inherent powers from those divested, the Court has said: The areas in which such implicit divestiture of sovereignty has been held to have occurred are those involving the relations between an Indian tribe and nonmembers of the tribe . . . . These limitations rest on the fact that the dependent status of Indian tribes within [the United States'] territorial jurisdiction is necessarily inconsistent with their freedom independently to determine their external relations. But the powers of self-government, including the power to prescribe and enforce internal criminal laws, are of a different type. They involve only the relations among members of a tribe. Thus, they are not such powers as would necessarily be lost by virtue of a tribe's dependent status. Id. (citations & quotation marks omitted). III. FOR CASES ARISING IN INDIAN COUNTRY INVOLVING TRIBES AND THEIR MEMBERS, OKLAHOMA DISTRICT COURTS HAVE GENERAL SUBJECT MATTERJURISDICTION UNLESS PREEMPTED BY CONGRESS OR THE EXERCISE OF STATE JURISDICTION INFRINGES ON THE TRIBE'S RIGHT TO MAKE THEIR OWN LAWSAND BE RULED BY THEM.8 ¶8 In civil cases, the determination of jurisdiction in a contest between state and tribe has depended heavily on the facts of that particular case. See, e.g., Williams v. Lee, 358 U.S. 217, 79 S. Ct. 269, 3 L. Ed. 2d. 251 (1959); Strate v. A-1 Contractors, 520 U.S. 438, 117 S. Ct. 1404, 137 L. Ed. 2d 661 (1997); Montana, 450 U.S. 544; Fisher, 424 U.S. 382.9 Some principles, however, have been distilled from existing case law. Montana v. United States, 450 U.S. 544, prescribes the following rule: an Indian tribe generally lacks civil authority over the conduct of nonmembers and non-Indians on non-Indian land10 within that tribe's reservation. Ibid. The Montana Rule is not without exceptions. Id. at 565-66. One of those exceptions is when that conduct infringes on tribal self-government. Id. at 564-66. Under the Montana exception when some on-reservation conduct threatens or has some direct effect on the political integrity, the economic security, or the health or welfare of the tribe, the tribe will exercise power to the point necessary to protect tribal self-government or to control internal relations. Id. The conduct must do more than injure the tribe, it must ''imperil the subsistence'' of the tribal community. Plains Commerce Bank v. Long Family Land & Cattle Co., 554 U.S. 316, 341, 128 S. Ct. 2709, 2726-27, 171 L. Ed. 2d 457 (2008). ¶9 Civil protection orders regulate domestic relations among persons and are routinely matters adjudicated in Oklahoma district courts. They clearly fall within the district courts' plenary, general subject matter jurisdiction. Okla. Const. art. VII, § 7(a). To understand whether the Creek Nation's Tribal District Court had exclusive jurisdiction, the question here is really whether the McIntosh County District Court's exercise of jurisdiction unlawfully infringed on the Creek Nation's right to self-government. See Williams, 358 U.S. at 220, 79 S. Ct. at 271 ("Essentially, absent governing Acts of Congress, the question has always been whether the state action infringed on the right of reservation Indians to make their own laws and be ruled by them."); see also Fisher, 424 U.S. at 386, 96 S. Ct. at 946. ¶10 In this case, Milne, a Creek Indian, filed in McIntosh County District Court a petition for a protection order against Hudson, a Cherokee Indian, for events occurring within the external boundaries of the Creek Nation reservation. Hudson attacked Milne at her home in McIntosh County.11 The attack serves as the basis for the protection order and a criminal case against Hudson.12 The criminal case was ultimately dismissed after the U.S. Supreme Court's decision in McGirt v. Oklahoma, 591 U.S. __, 140 S. Ct. 2452, L. Ed. 2d 985 (2020).13 In this appeal, Hudson challenges the jurisdiction of the district court to enter a civil order when the criminal case was dismissed for lack of jurisdiction. ¶11 State jurisdiction in Indian country may be preempted under ordinary principles of federal law. Castro-Huerta, 142 S. Ct. at 2494. Hudson's criminal case was dismissed because the Major Crimes Act preempts state jurisdiction over "Indians" committing certain enumerated crimes in "Indian country." 18 U.S.C. § 1153 (2018).14 In civil cases, however, there is no similar provision granting any court exclusive jurisdiction of protection order cases involving "Indians."15 Instead, federal Indian law jurisprudence leads us to cases explaining the extent of a tribe's inherent authority and the ability of a tribe to regulate domestic relations among its members. See Montana, 450 U.S. 544, 101 S. Ct. 1245. Preemption is not an issue in this case. Title 18 of the United States Code, § 2265(e) does provide "a court of an Indian tribe shall have full civil jurisdiction to issue and enforce protection orders involving any person" but it is in no way meant to create exclusive tribal jurisdiction. See Majority Op. ¶¶15-16. ¶12 If there is no preemption, then the next question concerns infringement on the Creek Nation's right to make their own laws and be governed by them. There are two categories of claims the U.S. Supreme Court has held tribes have exclusive civil jurisdiction under the infringement test: the first is where a nonmember asserts a claim against a member Indian for conduct occurring on the member Indian's reservation, see Williams, 358 U.S. at 223, 79 S. Ct. 269, 3 L. Ed. 2d 251; the second is where the cases involve internal/domestic matters, all parties are members of the same Indian Tribe, and the relevant conduct for the case occurs on that Tribe's reservation. See Fisher, 424 U.S. at 387-89. In both cases the Tribe has a strong interest in adjudicating the case as incident to their retained inherent sovereign powers. ¶13 Fisher controls the analysis in this case; however, we reach a different result with respect to the jurisdictional question because the case is distinguishable. In Fisher the United States Supreme Court held that state jurisdiction over the adoption of a Northern Cheyenne Indian child--where every party to the adoption was also a member of the Northern Cheyenne Indian Tribe and resided within the Tribe's reservation--was infringement on the right of the Tribe to govern itself. Fisher, 424 U.S. at 389, 96 S. Ct. at 948. The Court recognized the right of the Tribe to independently govern itself had been protected; the Tribe adopted a constitution and bylaws intended to "revitalize their self-government." Id. at 386-87, 96 S. Ct. at 946. Based on this, the Tribe established its Tribal Court and "granted it jurisdiction over adoptions among members of the Northern Cheyenne Tribe." Id. at 387 (internal citations omitted). The revised law said the Tribal Court "shall have jurisdiction" to review "adoptions among members of the Northern Cheyenne Tribe." Id. at 391 n.5. Acknowledging this, the U.S. Supreme Court recognized that the exercise of state-court jurisdiction over the adoption would plainly interfere with the Northern Cheyenne Tribe's self-government. Id. at 387-88. If states were also allowed to adjudicate the adoption of a member Indian wherein all parties to the adoption were also member Indians and resided within the reservation of the Tribe, the Court reasoned there would be substantial risk of different decisions and cause a decline in the Tribal Court's authority. Id., 424 U.S. 388. ¶14 Because it was infringement, the Tribe had exclusive jurisdiction over the adoption proceeding. Id. at 389. A different result would be reached, however, had the adoption involved nonmember Indians or non-Indians or both who wished to adopt a member of the Northern Cheyenne Tribe. Id. at 391 n.5 ("On all adoptions involving nonmembers of the Northern Cheyenne Tribe or non-Indians or both who wish to adopt a member of the Northern Cheyenne Tribe, the Tribal Court of the Northern Cheyenne Reservation shall have concurrent jurisdiction to hear, pass upon, and approve applications for adoption and upon written consent of the court, adoption proceedings affecting members of the Northern Cheyenne Tribe of the Northern Cheyenne Reservation may be taken up and consummated in the State Courts."). In that event, the Tribe had a law which provided that the Northern Cheyenne Reservation shall have concurrent jurisdiction with State courts. Id. This legislative decision regarding jurisdiction--to extend concurrent jurisdiction--comports with case law that reiterates tribal inherent authority is limited to their members and territory,16 and with case law that equates a tribe's adjudicative jurisdiction at least to its legislative jurisdiction as it relates to nonmembers.17 ¶15 In our case, the Creek Nation has enacted its own code, which includes Title 6 allowing for civil protection orders; it also has its Tribal District Court. Title 6 pertains to "Children and Family Relations." Subchapter 4 regards civil procedures and remedies. Notably, § 3-401 of the Creek Code grants to the Nation's Tribal District Court full civil jurisdiction to issue protection orders in certain instances, but it does not claim exclusive jurisdiction for itself. § 3--401 Civil jurisdictionThe District Court has full civil jurisdiction to issue protection orders if the petitioner currently or temporarily resides in the Muscogee (Creek) Nation territorial jurisdiction, if the respondent currently or temporarily resides in the Muscogee (Creek) Nation territorial jurisdiction or if the domestic, dating or family violence occurred in the Muscogee (Creek) Nation territorial jurisdiction or on other land under the authority of the Muscogee (Creek) Nation; provided that such civil jurisdiction may be exercised regardless of the Indian or non-Indian status of petitioners and respondents. There is no minimum requirement of residency to petition the District Court for an order for protection. In accordance with 18 U.S.C. § 2265(e), the District Court has full civil jurisdiction to enforce protection orders issued by the District Court and to enforce foreign protection orders pursuant to Title 6, §§ 3--415, 3--416 and 6--3--417. Muscogee (Creek) Nation Code Ann. tit. 6, § 3-401 (West 2010), as amended by Act of March 28, 2016, NCA 16-038, sec. 3, § 3-401, at 30-31, available at http://www.creeksupremecourt.com/wp=content/uploads/NCA-16-038-part-2.pdf. ¶16 The next section, § 3-402, lists those petitioners eligible for civil protection orders in the Creek Tribal District Court--for each category of petitioner the code provision provides that they "may seek relief," "may file a civil petition for an order," or " may request an emergency temporary protection order" § 3--402 Eligible petitioners for civil protection orderA. Petition by victim. Any victim of domestic violence, stalking, harassment, sexual assault, dating violence or family violence may seek relief by filing a civil petition for protection order with the District Court as an independent action or by a motion in a pendent lite order in another proceeding on behalf of their self and/or any domesticated animals threatened. Provided, that if made by oral motion it shall be promptly memorialized by written motion. B. Petition on behalf of child. A parent, guardian, or other representative may file a civil petition for an order for protection on behalf of a child or incapacitated adult or any minor age sixteen (16) or seventeen (17) years may seek relief under the provisions of this Code. C. Motion by Prosecutor. The Prosecutor may move for an order of protection on behalf of a victim, minor child or incapacitated adult in an independent action or as a pendent lite order in another proceeding provided that such motion is memorialized by a written motion. D. Request for emergency temporary order. If the domestic, dating or family violence, stalking, harassment or sexual assault occurs when the District Court is not open for business, such person may request an emergency temporary protection order as provided by Title 6, §§ 3--306 and 3--405. The District Judge or other Court officer with authority to issue an order for protection shall be available twenty-four (24) hours a day to hear motions or petitions for emergency orders for protection. Muscogee (Creek) Nation Code Ann. tit. 6, § 3-402 (West 2010), as amended by Act of March 28, 2016, NCA 16-038, sec. 3, § 3-402, at 31, available at http://www.creeksupremecourt.com/wp=content/uploads/NCA-16-038-part-2.pdf. ¶17 For civil protection orders the Creek Code is permissive and allows any person within their territorial limits to file a petition for civil protection order. The Code provides for concurrent jurisdiction. IV. CONCLUSION ¶18 The Creek Nation Tribal Court and McIntosh County District Court have concurrent jurisdiction; tribal jurisdiction is not exclusive as it does not meet the criteria under Montana, or more specifically, Fisher. ¶19 In litigation between a member Indian and a nonmember "arising out of conduct on an Indian reservation, resolution of conflicts between the jurisdiction of the state and tribal courts has depended, absent a governing Act of Congress, on 'whether the state action infringed on the right of reservation Indians to make their own laws and be ruled by them.'" Fisher, 424 U.S. at 386, 96 S. Ct.at 946 (emphasis added). ¶20 Milne could have filed a civil protection order petition in more than one court. Nowhere in the Creek Code is exclusive jurisdiction claimed for the issuance of civil protection orders. No infringement on the right of the Creek Nation to govern itself can be shown in this case. Until there is some conduct that injures the Tribe's right to self-government to the extent required under federal jurisprudence, there can be no infringement. The McIntosh County District Court had jurisdiction. FOOTNOTES 1 See Lewis v. Sac & Fox Tribe of Okla. Hous. Auth., 1994 OK 20, ¶¶ 15-16, 896 P.2d 503, 510-11: Under our system of federalism, a state's sovereignty is concurrent with that of the federal government, subject only to limitations imposed by the Supremacy Clause. Yellow Freight System, Inc. v. Donnelly teaches that state courts have inherent authority, and are thus presumptively competent, to adjudicate claims arising under the laws of the United States. To give federal courts exclusive jurisdiction over a federal cause of action, Congress must, in an exercise of its powers under the Supremacy Clause, affirmatively divest state courts of their presumptively concurrent jurisdiction. In Gulf Offshore v. Mobil Oil the Court identified three different methods by which a congressional state-court ouster may be effected --- (1) by an explicit statutory directive, (2) by unmistakable implication from legislative history, or (3) by a clear incompatibility between state-court jurisdiction and federal interests. The constitutional ouster-of-jurisdiction doctrine is not to be confused with federal preemption. Preemption occurs when federal law displaces a body of state law on the same subject. Unlike state-court ouster, which requires that we examine the law for the presence of an explicit statutory directive conferring exclusive federal-court jurisdiction, preemption is a matter of congressional intent, which may be effected even by regulations of a federal agency acting within the scope of congressionally delegated authority. Preemption alone cannot divest state courts of jurisdiction to entertain federal-law claims. (Internal quotations and footnotes omitted). 2 McGirt v. Oklahoma, 591 U.S. ___, 140 S. Ct. 2452, 207 L. Ed. 2d 985 (2020) held that the Muscogee (Creek) Nation's Reservation was never disestablished and thus remains "Indian country" under the definition of the Major Crimes Act at 18 U.S.C. § 1151 (2018). Ibid. at 2460-82. As of June 29, 2022, the U.S. Supreme Court has recognized the following reservations within the external boundaries of Oklahoma: Creek, Cherokee, Choctaw, Chickasaw and Seminole Reservations. Oklahoma v. Castro- Huerta, 597 U.S. ___, 142 S. Ct. 2486, 2490, 213 L. Ed. 2d 847 (2022). 3 See, e.g., Williams v. Lee, 358 U.S. 217, 79 S. Ct. 269, 3 L. Ed. 2d. 251 (1959) (transaction took place on reservation, the Tribe had developed legal court system, the defendant was a reservation Indian); Strate v. A-1 Contractors, 520 U.S. 438, 117 S. Ct. 1404, 137 L. Ed. 2d 661 (1997) (non-Indian owned business defendant at time of accident was subcontractor for wholly owned business of the Tribe, accident occurred within the external boundaries of the reservation, but on alienated, non-Indian land); Montana v. United States, 450 U.S. 544, 101 S. Ct. 1245, 67 L. Ed. 2d 493 (1981) (regulation of on-reservation conduct, but on non-Indian fee land by non-Indian persons); Fisher v. Dist. Court, 424 U.S. 382, 96 S. Ct. 943, 47 L. Ed. 2d 106 (1976) (per curium) (adoption of tribal member wherein parents were tribal members and prospective adoptive parents were tribal members). 4 The Court has at times referred to "nonmembers" and "non-Indians" interchangeably. An Indian tribe's inherent authority extends to its members, not nonmember Indians or non-Indians. See Duro v. Reina, 495 U.S. 676, 110 S. Ct. 2053, 109 L. Ed. 2d 693 (1990); Montana, 450 U.S. 544 (1981); see also Nevada v. Hicks, 533 U.S. 353, 377 n.2, 121 S. Ct 2304, 2319 n.2, 150 L. Ed. 2d 398 (2001) (Souter, J., concurring). 5 See infra. Section 3-401 authorizes any person to file a protection order if the petitioner resides within Creek Nation's territorial jurisdiction. The Indian status is irrelevant. 6 "The District Court shall have unlimited original jurisdiction of all justiciable matters, except as otherwise provided in this Article, and such powers of review of administrative action as may be provided by statute." Okla. Const. art. VII, § 7(a) (emphasis added). 7 "Indian country" is defined at 18 U.S.C. § 1151 (2018): Except as otherwise provided in sections 1154 and 1156 of this title, the term "Indian country", as used in this chapter, means (a) all land within the limits of any Indian reservation under the jurisdiction of the United States Government, notwithstanding the issuance of any patent, and, including rights-of-way running through the reservation, (b) all dependent Indian communities within the borders of the United States whether within the original or subsequently acquired territory thereof, and whether within or without the limits of a state, and (c) all Indian allotments, the Indian titles to which have not been extinguished, including rights-of-way running through the same. 8 Williams v. Lee, 358 U.S. 217, 79 S. Ct. 269, 3 L. Ed. 2nd 251 (1959); see also Castro Huerta, 142 S. Ct. at 2494 ("[A] State's jurisdiction in Indian country may be preempted (i) by federal law under ordinary principles of federal preemption, or (ii) when the exercise of state jurisdiction would unlawfully infringe on tribal self-government"). 9 See supra, note 3. 10 Subsequently alienated lands within external reservation borders owned in fee by non-Indians. 11 More information about the location of her home is unknown from the record. For example, it is not shown that the property is on an allotment, on trust land, held for the benefit of the Tribe or otherwise. 12 See State v. Howard Jefferees Hudson, Jr., No. CF-2020-00187 in McIntosh County. The case was dismissed 3/2/2021 based on McGirt. 13 See supra note 12. 14 Section 1153 provides: (a) Any Indian who commits against the person or property of another Indian or other person any of the following offenses, namely, murder, manslaughter, kidnapping, maiming, a felony under chapter 109A, incest, a felony assault under section 113, an assault against an individual who has not attained the age of 16 years, felony child abuse or neglect, arson, burglary, robbery, and a felony under section 661 of this title within the Indian country, shall be subject to the same law and penalties as all other persons committing any of the above offenses, within the exclusive jurisdiction of the United States. (b) Any offense referred to in subsection (a) of this section that is not defined and punished by Federal law in force within the exclusive jurisdiction of the United States shall be defined and punished in accordance with the laws of the State in which such offense was committed as are in force at the time of such offense. 18 U.S.C. § 1153 (2018). 15 Although the criminal jurisdiction of the tribal courts is subject to substantial federal limitation, their civil jurisdiction is not similarly restricted. See Nat'l Farmers Union Ins. Cos. v. Crow Tribe of Indians, 471 U.S. 845, 854, 105 S. Ct. 2447, 2453, 85 L. Ed. 2d 818 (1985). 16 United States v. Mazurie, 419 U.S. 544, 557, 95 S. Ct. 710, 717, 42 L. Ed. 2d 706 (1975); Wheeler, 435 U.S. 313, 98 S. Ct. 1079, 55 L. Ed. 2d 303 (1978); Montana, 450 U.S. 544, 101 S. Ct. 1245, 67 L. Ed. 2d 493 (1981). 17 Strate, 520 U.S. at 453, 117 S. Ct. at 1413; Plains Commerce Bank, 554 U.S. 316, 128 S. Ct 2709, 171 L. Ed. 2d 457 (2008); Nevada v. Hicks, 533 U.S. 353, 121 S. Ct. 2304, 150 L. Ed. 2d 398 (2001). COMBS, J., with whom KAUGER, J., joins, concurring specially: ¶1 In my opinion, this case comes down to the plain language of the state statute and the tribal statute. The state statute provides: A. A victim of domestic abuse, a victim of stalking, a victim of harassment, a victim or rape, any adult or emancipated minor household member on behalf of any other family or household member who is a minor or incompetent, or any minor age sixteen (16) or seventeen (17) years [to] seek relief under the provision of the Protection from Domestic Abuse Act. 1. The person seeking relief may file a petition for a protective order with the district court in the county in which the victim resides, the county in which the defendant resides, or the county in which the domestic violence occurred. . . . 22 O.S.Supp.2020, § 60.2 (amended 2022). Similarly, the tribal statute provides: The [tribal] District Court has full civil jurisdiction to issue protection orders if the petitioner currently or temporarily resides in the Muscogee (Creek) Nation territorial jurisdiction, if the respondent currently or temporarily resides in the Muscogee (Creek) Nation territorial jurisdiction or if the domestic, dating or family violence occurred in the Muscogee (Creek) Nation territorial jurisdiction or on other land under the authority of the Muscogee (Creek) Nation . . . regardless of the Indian or non-Indian status of petitioners and respondents . . . . [and with] no minimum requirement of residency to petition the District Court for an order for protection. Muscogee (Creek) Nation Code Ann. tit. 6, § 3-401 (West 2010), as amended by Act of March 28, 2016, NCA 16-038, sec. 3, § 3-401, at 30--31, available at http://www.creeksupremecourt.com/wp-content/uploads/NCA-16-038-part-2.pdf. Neither statute specifies that any party have "Indian or non-Indian status"; only the location of the domestic violence or of one party's residence matters. Thus, where that location can be classified as both state and tribal territory, both courts have jurisdiction--that is, concurrent jurisdiction--to issue a protective order. Gurich, J., concurring in judgment: ¶1 Although I believe the majority opinion reaches the correct conclusion in this case, I write separately to caution against interpreting the Court's ruling too broadly. To the extent the opinion could be construed as permitting state court jurisdiction over any protective order matter arising in Indian country, irrespective of the parties' statuses as member Indians, such a declaration is contrary to long-standing federal Indian law and I cannot join such a decree. ¶2 The domestic violence giving rise to the victim's protective order issued by the state district court took place within the boundaries of the Muscogee (Creek) Reservation;1 thus, the acts occurred within Indian country. 18 U.S.C. § 1151(a). Both the alleged victim and alleged perpetrator are members of federally recognized Indian tribes. Milne is an enrolled member of the Muscogee (Creek) Nation and Hudson is an enrolled member of the Cherokee Nation. Because Hudson is not a member of the Muscogee (Creek) Nation, the jurisdictional question presented in this case becomes less clear.2 ¶3 Generally speaking, an Indian may bring a civil action against a non-Indian in state court. Three Affiliated Tribes of the Fort Berthold Reservation v. Wold Eng'g, P.C., 467 U.S. 138, 148--49, 104 S. Ct. 2267, 2274--75, 81 L. Ed. 2d 113 (1984).3 This can be true even when part or all the acts giving rise to the suit took place in Indian country. Id. Renowned federal Indian law scholar, Felix Cohen, noted that "[i]n matters not affecting either the Federal Government or the tribal relations, an Indian has the same status to sue and be sued in state courts as any other citizen."4 However, when a civil lawsuit involves only members of a tribe, and the subject of the suit occurs within the boundaries of that tribe's reservation, an action must be maintained in tribal court. See Fisher v. Dist. Ct. of Sixteenth Jud. Dist. of Mont., 424 U.S. 382, 389, 96 S. Ct. 943, 947, 47 L. Ed. 2d 106 (1976). Similarly, a state court would lack jurisdiction to hear a protective order sought by a non-Indian or nonmember against a member Indian, if the acts giving rise to the civil proceeding took place on the member's tribal reservation. See Williams v. Lee, 358 U.S. 217, 79 S. Ct. 269, 3 L. Ed. 2d 251 (1959).5 However, neither Fisher nor Williams dealt with a civil lawsuit in which the plaintiff is a member Indian and the defendant is a nonmember Indian. ¶4 In Washington v. Confederated Tribes of the Colville Indian Reservation, 447 U.S. 134, 100 S. Ct. 2069, 65 L. Ed. 2d 10 (1980), the Supreme Court found the state could lawfully tax cigarette sales to nonmembers and non-Indians, even though those transactions occurred on reservation land. To reach this decision, the Court effectively found that the tribes and state enjoyed concurrent jurisdiction to tax nonmembers and non-Indians, and that the state's imposition of taxes were neither preempted by federal law nor an infringement on tribal sovereignty. Id. at 155-56, 161. In reaching the latter conclusion, the Court explained: Nor would the imposition of Washington's tax on these purchasers contravene the principle of tribal self-government, for the simple reason that nonmembers are not constituents of the governing Tribe. For most practical purposes those Indians stand on the same footing as non-Indians resident on the reservation. There is no evidence that nonmembers have a say in tribal affairs or significantly share in tribal disbursements. We find, therefore, that the State's interest in taxing these purchasers outweighs any tribal interest that may exist in preventing the State from imposing its taxes. Id. at 161; see also Wacondo v. Concha, 117 N.M. 530, 873 P.2d 276 (N.M. Ct. App. 1994). Wacondo presents facts and legal issues strikingly similar to those in the present dispute. Ms. Wacondo and Ms. Salas filed a lawsuit in state court against Mr. Concha for personal injuries arising out of a shooting on the Jemez Pueblo in New Mexico. Ms. Wacondo was a member of the Jemez peoples and resident of the Jemez Pueblo. Ms. Salas was a member of the Zia peoples, but she resided outside of the boundaries of any pueblo. Mr. Concha was a member of the Taos Pueblo, however, there is no mention of his residence in the opinion. Defendant Concha moved to dismiss the action, arguing the state court lacked jurisdiction because the plaintiffs' cause arose on tribal lands and involved members of federally recognized tribes. On review, the appellate court considered one issue--whether Indian sovereignty or federal law would require the state courts to recognize exclusive jurisdiction in the Jemez courts because all of the parties were Indian and the subject of the suit occurred on the Jemez Pueblo. Finding that nothing foreclosed a member Indian from bringing suit against a non-member Indian in state court, the court opined: The facts here compel the conclusion that the "nonmember" Defendant cannot require Plaintiffs to forego their option of seeking redress in state district court. Nothing in our decision implies the Jemez Pueblo is in any way limited in providing a forum or remedies in this dispute. Our holding is merely that neither federal law nor tribal sovereignty precludes Indian plaintiffs from pursuing their state remedies against a nonmember Indian in state court. Id. at 534. Ultimately, the New Mexico Court of Appeals found the state district court had concurrent jurisdiction to hear the matter and reversed the dismissal order. Id. ¶5 It is my belief that the majority gives undue weight to cases such as Montana v. United States, 50 U.S. 544, 101 S. Ct. 1245, 67 L. Ed. 2d 493 (1981),6 United States v. Cooley, 593 U.S. ___, 141 S. Ct. 1638, 210 L. Ed. 2d 1 (2021),7 and Nevada v. Hicks, 533 U.S. 353, 121 S. Ct. 2304, 150 L. Ed. 2d 398 (2001).8 These decisions provide very little guidance to the issue presented in this case because each dealt with whether a tribe lacked jurisdiction to act.9 There is no dispute in this case--the Muscogee (Creek) Nation clearly had jurisdiction to enter a protective order.10 Instead, the proper questions for resolution in this case are: (1) whether the exercise of jurisdiction by an Oklahoma state court would infringe on the right of the Muscogee (Creek) Nation to make its own laws and be ruled by them;11 and (2) was the exercise of jurisdiction in state court preempted by federal law.12 These two barriers are independent, and either "standing alone, can be a sufficient basis for holding state law inapplicable to activity undertaken on the reservation or by tribal members." Bracker, 448 U.S. at 143. ¶6 As to the first question, exercise of jurisdiction by the McIntosh County District Court in this case would not substantially infringe on the right of the Muscogee (Creek) Nation to govern itself. Although the Tribe has its own laws and court system designed to protect victims of domestic violence, there is no significant infringement of tribal sovereignty through the voluntary state court forum selection by Milne. Further, issuance of the protective order only placed legal restrictions on the nonmember, Hudson. And as the majority notes, the Muscogee (Creek) Nation's interests are aligned with its tribal member obtaining the quickest and most efficient remedy to ensure her safety. If such protection can best be obtained by seeking relief in state district court, this best serves the Nation and Milne. Also noted by the majority, Milne is not only a member of the Muscogee (Creek) Nation, but she is also an Oklahoma citizen. Therefore, nothing should preclude an Oklahoma citizen from seeking redress against a nonmember or non-Indian in our state courts, lest they be denied equal protection of the law and/or deprived of access to this State's judicial system. OKLA. CONST. art. II, §§ 6 & 7. However, as noted above, I do believe the assumption of jurisdiction by Oklahoma courts under different facts could offend tribal sovereignty. ¶7 In New Mexico v. Mescalero Apache Tribe, 462 U.S. 324, 334, 103 S. Ct. 2378, 76 L. Ed. 2d 611 (1983), the Supreme Court noted "[s]tate jurisdiction is preempted by the operation of federal law if it interferes or is incompatible with federal and tribal interests reflected in federal law, unless the State interests at stake are sufficient to justify the assertion of State authority." Concepts of sovereignty over a tribe's reservation and members "must inform the determination whether the exercise of state authority has been pre-empted by operation of federal law." Bracker, 448 U.S. at 143. An express congressional statement of preemption is not required. Id. at 144 (citing Warren Trading Post Co. v. Ariz. Tax Comm'n, 380 U.S. 685, 85 S. Ct. 1242, 14 L. Ed. 2d 165 (1965)). To properly assess preemption in this case, at least two federal enactments are at issue--Public Law 280 and the Violence Against Women Act, supra note 10, at 5. I agree with the majority that VAWA does not expressly preempt an Oklahoma court from exercising civil jurisdiction in this instance; however, I believe the outcome is limited to the unique facts presented. Public Law 280,13 on the other hand, presents a closer call. See Oklahoma v. Castro-Huerta, ___ U.S. ___ , 142 S. Ct. 2486, 213 L. Ed. 2d 847 (2022) (Gorsuch, J., dissenting). However, because the appellant failed to address preemption under P.L. 280, I reserve my consideration of the matter for another day. Bane v. Anderson, Bryant & Co., 1989 OK 140, ¶ 24, 786 P.2d 1230, 1236. ¶8 Although I agree with the majority that the McIntosh County District Court could exercise civil jurisdiction over this matter, it was only proper under the unique facts presented. I cannot fully accede in the majority's pronouncement. FOOTNOTES 1 See McGirt v. Oklahoma, 591 U.S. ___, 140 S. Ct. 2452, 2482, 207 L. Ed. 2d 985 (2020) (finding the Muscogee (Creek) reservation never disestablished by Congress). 2 Historically, issues pertaining to Indian jurisdiction "were conceptually drawn around only two categories of individuals: Indians and non-Indians." Pommersheim, Frank, The Crucible of Sovereignty: Analyzing Issues of Tribal Jurisdiction, 31 Ariz.L.Rev. 329, 355 (1989). Court decisions, however, have identified a third category of persons who impact the requisite jurisdiction analysis--nonmember Indians (those individuals who meet the definition of Indian, but who are not members of the tribe where the civil transaction arose). Id. 3 However, it should be noted that one factor considered by the Supreme Court was the tribe's inability to assume jurisdiction over a claim against the nonmember defendant. Id. at 149. But see Roe v. Doe, 2002 ND 136, ¶ 19, 649 N.W.2d 566, 574 (explaining that "nothing in [Three Affiliated Tribes] indicates it intended to limit the general rule of allowing state court jurisdiction over claims brought by an Indian against a non-Indian to only those cases in which the tribe was the plaintiff and the tribal court lacked jurisdiction over the claim at the time the suit was instituted"). 4 Felix S. Cohen, Handbook of Fed. Indian Law, ch. 19, § 5, at 379 (1942 ed.). 5 See also Roe, 2002 ND 136, ¶ 8, 649 N.W.2d at 569 (citing Fisher, 424 U.S. at 387-89 and Williams, 358 U.S. at 223). 6 The sole question in Montana was whether the Crow Tribe lacked power to prohibit hunting and fishing by nonmembers on non-Indian fee land within the reservation. In concluding there was no authority, the Supreme Court opined "exercise of tribal power beyond what is necessary to protect tribal self-government or to control internal relations is inconsistent with the dependent status of the tribes." Id. at 564. 7 Cooley merely affirmed a tribal police officer's authority to detain and search non-Indians traveling on public rights-of-way running through a reservation for potential violations of state or federal law. Id. at 1641. 8 In Hicks, the Supreme Court found that a tribal court lacked jurisdiction to adjudicate tort claims and an action under § 1983 against state officials. Id. at 364, 366-69. 9 See, e.g., Hinkle v. Abeita, 283 P.3d 877, 879-84 (N.M. Ct. App. 2012)(discussing in depth, the inapplicability of the Montana rule to a question of state court jurisdiction [not tribal] for a cause arising in Indian country). I believe reliance on Lewis v. Sac and Fox Tribe of Okla., 1994 OK 20, 896 P.2d 503, is likewise misguided. Therein, the majority concluded an Oklahoma state court had jurisdiction to adjudicate a real property dispute between a tribal member and the Sac and Fox Tribe of Oklahoma Housing Authority (SFTOHA). The decision is clearly distinguishable from the present matter. First, the Indian housing authority system adopted by Oklahoma had been created under the authority of the United States Housing Act of 1937, which specifically authorized the formation of tribal housing agencies under the umbrella of state law. Id. ¶ 3, 896 P.2d at 506. Second, the SFTOHA operated as a state agency, and the Sac and Fox Tribe explicitly authorized the housing agency to conduct business and exercise powers under Oklahoma law. Id. at 4, 896 P.2d at 506. Third, the Court concluded that the subject property was not located within Indian country at the time the transaction took place. Id. ¶ 24, 896 P.2d at 513. 10 The Violence Against Women Act (VAWA), Pub.L. 103-322, Title IV, § 40221(a), Sept. 13, 1994, 108 Stat. 1930 (amended by PL 106--386, October 28, 2000, 114 Stat 1464) specifically affords "full civil jurisdiction to issue and enforce protection orders involving any person. . . . in matters arising anywhere in the Indian country of the Indian tribe (as defined in section 1151)." 18 U.S.C. § 2265(e) (emphasis added). Thus, Congress has seen fit to bestow tribes with authority to adjudicate matters of domestic violence within tribal boundaries. Further, the Muscogee (Creek) Nation has enacted provisions within the Muskogee Creek Nation Code allowing the Nation's Tribal Court to issue protection orders "regardless of the Indian or non-Indian status of petitioners and respondents." Muscogee (Creek) Nation Code Ann. tit. 6, § 3-401 (West 2010), as amended by Act of March 28, 2016, NCA 16-038, sec. 3, § 3-401, at 30--31, available at http://www.creeksupremecourt.com/wp-content/uploads/NCA-16-038-part-2.pdf. 11 Williams, 358 U.S. at 220. 12 White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 142, 100 S. Ct. 2578, 65 L. Ed. 2d 665 (1980). 13 Public Law 280, ch. 505, 67 Stat. 588 (1953).

72b02c13-4b44-4d31-9fef-1bbd57527193

Price v. Zhang

oklahoma

Oklahoma Supreme Court

PRICE v. ZHANG2022 OK 95Case Number: 119053Decided: 11/22/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CHARLIE C. PRICE, Individually, and as Next of Kin of MARILYN L. PRICE, Deceased, Appellant/Plaintiff, v. WEI ZHANG, M.D., FREDERICK A. DORROH, M.D., ARDMORE SURGICAL ASSOCIATES, INC., MERCY CLINIC OKLAHOMA COMMUNITIES, INC., MERCY HOSPITAL-ARDMORE, INC., and John Doe/One or More, Appellees/Defendants. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION I Honorable Thomas K. Baldwin, Trial Judge ¶0 Four years after the appellant/plaintiff, Charlie Price (Price) filed a medical negligence/wrongful death action because his wife died from a stroke following surgery, the trial court dismissed the case for failure to prosecute. Price filed a motion for new trial arguing that he was denied due process because he was not given adequate notice of the hearing which resulted in the trial court's dismissal of his lawsuit. The trial court denied the motion for new trial, and the Court of Civil Appeals affirmed the trial court. We hold that because the plaintiff was not afforded adequate notice of the hearing in which the trial court dismissed the cause, due process requires that the dismissal be vacated. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT ORDER VACATED AND CAUSE REMANDED. J. Wes Billingsley, Ada, Oklahoma, for Appellant/Plaintiff. Michael J. Heron, Chris L. Fox, Edmond, Oklahoma, for Appellees/Defendants, Wei Zhang, and Mercy Hospital Ardmore, Inc. R. Gene Stanley, Stephen M. Rasbold, Oklahoma City, Oklahoma, for Appellees/Defendants, Frederick A. Dorroh, and Mercy Clinic Oklahoma Communities, Inc. KAUGER, J.: ¶1 We granted certiorari to address the balance between a trial court's attempt to dispose of a stagnant case and a litigant's right to due process.1 We agree that dilatory behavior by a litigant or litigants may require a trial court to control the docket and facilitate the orderly flow of business. However, due process, even though a flexible concept, requires certain procedural protections which were not afforded in this cause.2 We hold that because the plaintiff was not afforded adequate notice of the hearing in which the trial court dismissed the cause, due process requires that the dismissal be vacated. FACTS ¶2 At the outset we note that the trial court docket in this cause contains few entries, and few items are included in the record on appeal. Nevertheless, we can discern that Marilyn Price died from a massive stroke in April of 2014, nearly three weeks after a surgery to repair a small-bowel obstruction. Her husband, the appellant/plaintiff, Charlie Price (Price) filed a lawsuit on April 1, 2016, in the District Court of Carter Count, alleging that her death was the result of medical negligence/wrongful death. He sued the appellees/defendants, doctors Wei Zhang, and Frederick Dorroh, Ardmore Surgical Associates, Mercy Clinic, Mercy Hospital Ardmore, and anyone else involved in her care (collectively, doctors). ¶3 On February 27, 2019, the doctors filed a joint motion to dismiss for failure to prosecute. They argued that the plaintiff had been deposed over a year before, on February 20, 2018, which was the last activity in the case. Price filed a Response to the Motion to Dismiss on March 15, 2019. His attorney informed the trial court that during the pendency of the action, the plaintiff had suffered several substantial medical issues which had impacted his ability to participate in the litigation. Also on March 15, 2019, Price stated that he was ready and requested that the matter be set on the jury trial docket. ¶4 On May 14, 2019, the trial court filed a "NOTICE" which set the matter for "Annual Disposition Docket on 6-2-19 at 10:00." The notice indicates that it was mailed to the plaintiff's attorney. The cause was apparently not dismissed, because the next docket entries consisted of an entry of appearance filed on June 21, 2019, and a scheduling order filed on June 24, 2019, which set a pretrial conference for October 7, 2019, at 1:30 p.m. with notation that the trial date would be set on the November docket. ¶5 On October 7, 2019, both parties jointly filed a motion to extend the discovery deadline and reset the trial date. The reason? Plaintiff's counsel underwent a total hip replacement in June of 2019, and he had unforeseen complications with the procedure which inhibited his ability to work for several weeks. ¶6 The joint motion filed on October 7, 2019, was the last docket entry until nine months later, on July 22, 2020, when the trial court filed an order of dismissal without prejudice. It states that the pretrial conference was scheduled for July 13, 2020, at 1:30 p.m., but that the plaintiff's counsel did not appear. Instead, another attorney attended the pretrial conference on behalf of plaintiff's counsel, but the court limited the substitute counsel's participation in the proceeding. ¶7 The trial court dismissed the lawsuit without prejudice because there was "no evidence that plaintiff's counsel has prosecuted the case in an effort to move the case forward since the parties appeared before the Court in October 2019." On August 5, 2020, the plaintiff filed a Motion for New Trial. In it, plaintiff's counsel explains that: 1. After the lawsuit was initially filed, discovery was on-going at the request of the defendants; 2. On March 15, 2019, the plaintiff notified the Court he was ready to proceed and set a trial date, but the trial court never held a hearing on the motion; 3. Plaintiff was provided notice of the Annual Disposition Docket hearing on June 21, 2019, and the plaintiff appeared through a substitute counsel due to the plaintiff's lawyer having undergone hip replacement surgery four days prior to the hearing; 4. The parties jointly filed a motion to extend discovery; 5. The plaintiff's counsel appeared on October 7, 2019, for a pretrial conference, but no amended scheduling order, additional pleadings, or court minutes were filed following the October 7, 2019, pretrial conference; 6. On March 16, 2020, the Oklahoma Supreme Court issued an order in response to the COVID outbreak which ordered district courts to suspend jury trials and reschedule other hearings, etc., for thirty days. 7. On March 27, 2020, the Oklahoma Supreme Court entered another order extending the suspension until May 15, 2020; 8. On April 29, 2020, the Oklahoma Supreme Court entered a third order again amending scheduling until after July 31, 2020, with a few exceptions; 9. On July 10, 2020, the plaintiff's counsel received an email from defendant's counsel that stated that he had been advised by the trial court's bailiff that the cause was set for pretrial conference on July 13, 2020, at 1:30 p.m.; and 10. Even though the plaintiff's counsel was unsure as to whether there was actually a pretrial conference hearing set, he sent a substitute counsel who was fully prepared to proceed to the July 13, 2020, pretrial conference. He sent the substitute because he was unable to attend because he had a scheduling conflict involving his appearance at a final hearing in a cause in Pontotoc County, and he was unable to change it. Price submitted supporting emails from opposing counsel, and an affidavit with his Motion for New Trial. He argued that the sanction of a default judgment was improper and unwarranted because of the above listed circumstances. On August 13, 2020, the trial court filed an order denying Price's request for a new trial. ¶8 Price filed an appeal on September 14, 2020. The Court of Civil Appeals, in an unpublished opinion, affirmed the trial court's dismissal of the cause without prejudice for counsel's failure to appear at a pretrial conference hearing. We granted certiorari on October 10, 2022, and it was assigned to my chambers the next day. BECAUSE THE PLAINTIFF WAS NOT AFFORDED ADEQUATE NOTICE OF THE HEARING IN WHICH THE TRIAL COURT DISMISSED THE CAUSE, DUE PROCESS REQUIRES THAT THE DISMISSAL BE VACATED. ¶9 The doctors argue that the trial court did not err in its dismissal because the cause was filed in 2016 and Price issued no written discovery, took no depositions, and had two attorneys who were not entered in the case to appear on two separate occasions for court mandated conferences. Price argues that dismissal without providing sufficient and proper notice that the case was set for pretrial conference and dismissed denied him due process. We agree. ¶10 Three of our previous cases, applied collectively, govern this cause: Flandermeyer v. Bonner, 2006 OK 87, 152 P.3d 195; Brooks v. Baltz, 2000 OK 73, 12 P.3d 467; and Heiman v. Atlantic Richfield Co., 1991 OK 22, 807 P.2d 257. In Flandermeyer, supra, the trial court held divorce proceedings in a piecemeal fashion over the period of a year. The husband complained that he was being denied the right to a speedy and certain remedy. ¶11 We recognized that due process is implicated in a divorce proceeding, and that before any deprivation of it can occur, the fundamental requirement of due process of the opportunity to be heard in a meaningful time and in a meaningful manner must be satisfied. We also recognized a trial court's need to effectively and reliably manage their docket. We said: We realize that balanced against the obligation of the trial court to afford the parties a speedy and certain remedy is its need to control the docket and to facilitate the orderly flow of business. A trial court has the power to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants. However, a trial court is charged with the duty to schedule cases in such a manner as to expeditiously dispose of them. Implicit with this duty, is the necessity to hold trials in a nonserial manner. We would caution all trial courts that serialization of divorce proceedings should be avoided if at all possible. If necessary, presiding judges should review docket management procedures and assign judges from different divisions in order to achieve the orderly administration of justice. Although the trial court judge, in the exercise of sound discretion controls the disposition of the cause on its docket, this discretion is not unfettered ------ and we will not hesitate to provide remediation whenever docket management offends fundamental fairness, due process, and the right to a speedy and certain remedy. ¶12 Unfortunately for the husband in Flandermeyer, supra, most of the delays he suffered were attributable to him, and his conduct at the hearings. Consequently, we held that, under the particular facts of the cause, due process was not violated. Flandermeyer, supra, insofar as it relates to this cause teaches that a delicate balance is required between a trial court's expeditious control and disposition of its docket and meeting minimum due process requirements of its litigants. ¶13 Brooks, supra, concerned a father who was incarcerated for contempt based on his failure to pay in accordance with a child support order. The father challenged the order requiring support payments, alleging that he did not receive notice of the hearing on that order, and that the order erroneously determined that he had previously been adjudicated the father of the child involved. Nothing on the trial court docket reflected that notice of the hearings for child support were mailed or personally delivered to the father, or anyone else for that matter. ¶14 The Court noted that fundamental fairness must be afforded within a framework of orderly procedure and that fairness includes giving notice of certain judicial events which alter legally cognizable rights. We held that failure to give notice of a hearing for the adjudication of rights falls short of the minimum standards of due process. It is a jurisdictional error, unless the requirement is waived by the party affected. Notice is mandatory and failure to give record notice of the hearing was a jurisdictional defect. Brooks, supra, insofar as it related to this cause teaches that the fundamental standards of due process requires full and adequate notice to be given for hearings which could alter legally cognizable rights. Failure to give such notice, unless waived, results in a void order. ¶15 Finally, in Heiman, supra, the trial court, like the trial court here, dismissed a cause for failure to prosecute. However, the dismissal was void because neither parties had actual notice of the setting of the hearing. The only notice given was a publication notice of disposition which was authorized by statute. The Court held that when the hearing taking place is marking a dispositive event which terminates the litigation, due process requires actual notice either by personal service or mail. The teachings of Heiman, supra, insofar as they related to this cause are that due process requires personal notice of a hearing, either through personal service or mail, which may culminate in the dismissal of the litigation. ¶16 In sum, the cumulative teachings of Flandemeyer, supra, Brooks, supra, and Heiman, supra, are that a critical stage of litigation occurs when a trial court, when managing a cause, sets a hearing which could result in a ruling dispositive of an action. This critical stage of litigation constitutionally requires personal notice. While a trial court may control its docket, it may not be done at the expense of a litigant's due process rights. ¶17 In Cate v. Archon Oil Co. Inc., 1985 OK 15, ¶10, 695 P.2d 1352, we explained that the right to be heard is of little value without adequate notice: ¶10 Notice is a jurisdictional requirement as well as a fundamental element of due process. Due process requires adequate notice, a realistic opportunity to appear at a hearing or judicial sale, and the right to participate in a meaningful manner before one's rights are irretrievably altered. The right to be heard is of little value unless adequate notice is given. Due process is violated by the mere act of exercising judicial power upon process not reasonably calculated to apprise interested parties of the pendency of an action, and lack of notice constitutes a jurisdictional infirmity. (Footnotes omitted.) ¶18 Under these facts, there is no indication from the trial court docket, or otherwise, that the pretrial conference was scheduled. The plaintiff's attorney only learned about the hearing from a message from opposing counsel three days before it was held because counsel had "heard" from the trial court's bailiff that it had been scheduled. While waiver of notice is possible in some circumstances, we cannot say that the plaintiff waived a full and fair notice of a hearing which resulted in the termination of his lawsuit. ¶19 Ordinarily, waiver is the voluntary and intentional relinquishment of a known right.3 It is essentially a matter of intention, focusing on the intent of the party against whom waiver is asserted.4 It can be express or implied by action or conduct.5 It appears that the plaintiff's counsel took the matter seriously because he tried to change his other court appearance, and he sent a substitute counsel. Regardless, this should not equate with an adequate waiver of notice to a proceeding which results in the termination of the lawsuit. Consequently, due process requires that the dismissal be vacated. CONCLUSION ¶20 The trial court, in the exercise of sound discretion controls the disposition of causes on its docket.6 Nevertheless, under these particular facts, after scrutinizing the docket scheduling, it is clear that the plaintiff was not given adequate notice of a hearing which resulted in the termination of his lawsuit. Because the plaintiff was not afforded adequate notice of the hearing in which the trial court dismissed the cause, due process requires that the dismissal be vacated and the matter remanded to the trial court. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT ORDER VACATED AND CAUSE REMANDED. KANE, V.C.J., KAUGER, EDMONDSON, GURICH, ROWE, JJ., concur. DARBY, C.J., WINCHESTER, COMBS, KUEHN, JJ., dissent. FOOTNOTES 1 The United Stated Constitution amendment 14 provides in pertinent part: . . . No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws. . . . The Okla. Const. art. 2 § 7 provides: No person shall be deprived of life, liberty, or property, without due process of law. The Okla. Const. art. 2, §6 provides: The courts of justice of the State shall be open to every person, and speedy and certain remedy afforded for every wrong and for every injury to person, property, or reputation; and right and justice shall be administered without sale, denial, delay, or prejudice. 2 Procedural due process requires an inquiry into the constitutional adequacy of the State's procedural safeguards. The substantive component of the due process clause bars certain governmental action despite the adequacy of procedural protections provided. Flandermeyer v. Bonner, 2006 OK 87, ¶8, fn 2, 152 P.3d 195; Nelson v. Nelson, 1998 OK 10, ¶15, n. 25-26, 954 P.2d 1219. 3 Barringer v. Baptist Healthcare of Oklahoma, 2001 OK 29, ¶22, 22 P.3d 695; Faulkenberry v. Kansas City Southern Ry. Co., 1979 OK 142, ¶6, 602 P.2d 203. 4 Barringer v. Baptist Healthcare of Oklahoma, see note 3, supra; Archer v. Wedderien, 1968 OK 186, ¶14, 446 P.2d 43; State ex rel. Gaines v. Beaver, 1945 OK 318, ¶21, 166 P.2d 776. 5 Barringer v. Baptist Healthcare of Oklahoma, see note 3, supra; Crowell v. Thoreau Center, Partnership, 1981 OK 84, ¶2, 631 P.2d 751. 6 Flandermeyer v. Bonner, see note 2, supra at ¶15; Hambright v. City of Cleveland, 1960 OK 184, ¶16, 360 P.2d 493 (Control over the docket cannot be arbitrary, but must be in the exercise of the sound discretion of the trial court.).

94b7c6ba-30f9-47cf-bb48-2ee6e13596af

Bailey, et al. v. Oklahoma ex rel. Bd. of Tests for Alcohol & Drug Influence

oklahoma

Oklahoma Supreme Court

BAILEY v. STATE ex rel. BD. OF TESTS FOR ALCOHOL AND DRUG INFLUENCE2022 OK 50Case Number: 118532Decided: 05/24/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. COURTNEY BAILEY, KENNETH BAXTER, OSCAR BERNAL, KEVIN BUCKMASTER, EZEQUIEL CARDENAS-MEKIA, BENJAMIN CLEMENTS, CHANCE GIMLIN, ALEX HILL, MELANIE HUNTER, LANNETTE JORDAY, CORBIN LACEY, COLTON LIENTZ, TREVOR MCFARLAND, JOHNNY NEEDHAM, AMBER OSEI, REGIN PREM-AMAND, DONALD RILEY, DARIN SEEBECK, KALA VAN KIRK, and AUSTIN VASICEK, Plaintiffs/Appellees,v.STATE OF OKLAHOMA, ex rel., BOARD OF TESTS FOR ALCOHOL AND DRUG INFLUENCE, and KEVIN BEHRENS,andSTATE OF OKLAHOMA, ex rel. DEPARTMENT OF PUBLIC SAFETY, RUSTY RHOADES, COMMISSIONER, Defendants/Appellants. CERTIORARI TO THE OKLAHOMA COURT OF CIVIL APPEALS, DIVISION NO. I ¶0 Plaintiffs filed an action in the District Court challenging rules adopted by the Oklahoma Board of Tests for Alcohol and Drug Influence at one of its meetings. Those rules were subsequently used by the Oklahoma Department of Public Safety in actions to revoke the plaintiffs' driver's licenses. The Honorable Thomas E. Prince, District Judge, for the District Court of Oklahoma County, held an evidentiary hearing and concluded (1) the Board violated the Oklahoma Open Meeting Act and (2) rules adopted by the Board at its meeting were invalid. Defendants appealed and the Court of Civil Appeals concluded a willful violation of the Open Meeting Act did not occur and reversed the District Court. The plaintiffs filed a petition for certiorari to review the opinion by the Court of Civil Appeals. We previously granted certiorari. We hold: The evidence was insufficient to make a prima facie case that the Board's Director willfully violated the Open Meeting Act when he failed to send the email notice of the special meeting to the Secretary of State. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OFCIVIL APPEALS VACATED; JUDGMENT OF DISTRICT COURT REVERSED;AND CONTROVERSY REMANDED FOR ADDITIONAL PROCEEDINGS Kevin L. McClure, Assistant Attorney General, Oklahoma Attorney General's Office, Oklahoma City, Oklahoma, for Defendants/Appellants. Brian K. Morton, Oklahoma City, Oklahoma, for Plaintiffs/Appellees. EDMONDSON, J. ¶1 The issue before us is whether the evidence was sufficient to show a prima facie case that an official committed a willful violation of the Open Meeting Act when he did not send a notice of a special meeting to the Secretary of State. We hold the evidence was insufficient to show a prima facie willful violation of a statute.1 The evidence showed a single event of an official's forgetfulness and omission when he sent an email notice to many individuals and failed to include the Secretary of State's address on the email, and additional evidence showed this omission was not a willful violation of the Act. We reverse the judgment of the District Court which found a violation of the Open Meeting Act by Oklahoma Board of Tests for Alcohol and Drug Influence. The District Court concluded this Board's emergency rules were invalid based upon the District Court's finding a violation of the Open Meeting Act, and that conclusion is also reversed. I. Trial Court Controversy ¶2 Plaintiffs' petition in the District Court invoked a statute authorizing a declaratory judgment (12 O.S. § 1651), and two statutes in the Oklahoma Administrative Procedures Act (75 O.S. §§ 253, 306). The petition alleged the Oklahoma Department of Public Safety "would seek to admit the breath test results against Plaintiffs in implied consent driver's license revocations actions, based upon emergency rules promulgated by the BOT [Oklahoma Board of Tests for Alcohol and Drug Influence] . . . [and] application of these emergency rules threatens to impair Plaintiffs' driving privileges." Plaintiffs alleged they "have timely filed appeals of these revocations in District Courts throughout the state." Plaintiffs challenged rules governing alcohol testing equipment and procedure that were previously adopted by the Oklahoma Board of Tests for Alcohol and Drug Influence (the Board). ¶3 The challenged rules were adopted in response to a decision by the Court of Civil Appeals. In Sample v. State ex rel. Department of Public Safety, 2016 OK CIV APP 62, 382 P.3d 505, the Court of Civil Appeals affirmed a trial court's judgment which determined the Department of Public Safety (DPS) improperly revoked a driver's license. The DPS revocation was based upon alcohol breath test procedure and equipment which was approved by the Board, but the form of the Board's approval was not by promulgated administrative rules. Sample relied upon the then current version of 47 O.S. § 759(C) which authorized the Board to adopt, amend and repeal administrative rules for enforcing Oklahoma implied consent laws. The Board held a Special Meeting on October 7, 2016, to promulgate Emergency Rules in response to the court's opinion in Sample, and these are the rules challenged by plaintiffs. ¶4 Plaintiffs argued the Board violated provisions in Oklahoma's Open Meeting Act (OMA),2 Oklahoma Administrative Procedures Act (OAPA),3 and the Oklahoma Administrative Code (OAC). They alleged: (1) Notice of a meeting held by the Board on October 7, 2016, was not provided as required by 25 O.S.2011 § 311 of the OMA; (2) The meeting did not satisfy the requirements of OAC 40:1-1-3 because the meeting was called by the Director of the Board without proper public notice; and (3) The emergency rules adopted by the Board for the purpose of amending then existent permanent rules were not properly promulgated pursuant to 75 O.S.Supp.2013 § 253 of the OAPA. ¶5 The defendants answered and asserted plaintiffs "have an exclusive remedy to raise the issues they have raised in this case in the county where their implied consent case has been filed." Defendants admitted certain rules were promulgated and denied such rules invalidated plaintiffs' arrests or the accuracy of plaintiffs' breath tests. Defendants denied the alleged violations of the OMA, OAPA, and the rules of the Board. ¶6 Plaintiffs filed a motion to enter the cause on a non-jury docket for trial. No pretrial conference was held and no Rule 5 pretrial order was filed.4 Defendants filed a motion for summary judgment which included both OMA issues as well as affirmative defenses based upon other litigation involving plaintiffs. Plaintiffs' response did not request summary judgment, and argued "there is a material fact in dispute." On August 8, 2019, the trial court filed a Court Minute stating defendants' motion for summary judgment was denied, and the minute set an "evidentiary hearing" for October 13, 2019. On the day of the hearing, defendants filed an "Evidentiary Hearing Trial Brief and Motion for Judgment as a Matter of Law." Plaintiffs filed a trial brief after the hearing. The trial court and the parties appear to have treated this evidentiary hearing as a trial on the merits because the journal entry of judgment after the hearing disposed of the claims "at issue," including the various affirmative defenses pled by Defendants' Answer but not raised in their motion for summary judgment or at the hearing, except for two defenses related to res judicata and estoppel. ¶7 Defendants' combined motion and brief contains several references to "undisputed evidence." No issue is identified as a specific issue of fact for trial court review, and the identified issues are explained with references to one or more legal principles needing an adjudication. Defendants argued "it is undisputed that the Board did give actual notice of the Special Meeting to the public and to Plaintiffs' own attorney." The conclusion of the motion states undisputed evidence shows no violation of the Administrative Code or the Open Meeting Act, and by plaintiffs' guilty pleas in previous criminal cases "they come into this court with unclean hands and are precluded from challenging the Emergency [administrative] Rules." ¶8 On October 31, 2019, the parties appeared for the evidentiary hearing. The trial judge asked for opening statements and plaintiffs' counsel stated defendants "carry the burden" and could speak first. The trial judge characterized defendants' speaking first as "the burden of presentation, [and] order of proof." Defendants argued three issues were before the trial court: (1) Whether the Board violated the OAPA and 40:1-1-3 of the Administrative Code, and that defendants had the burden of proof; (2) Whether the Board's Special Meeting on October 7, 2016 violated the OMA due to improper and willful conduct of an official, and plaintiffs had this burden of proof; and (3) Whether the Board properly promulgated emergency rules, and defendants had this burden. Two witnesses testified at the hearing, a former Director for the Board and a former member of the Board. The trial court filed the journal entry of judgment a few weeks after the hearing. ¶9 The judgment states that on October 5, 2016, the Director of the Board sent a Notice of a Special Meeting to all of the individuals and media who had requested email notifications of the Board's meetings. The notice was for a meeting "to discuss possible action on proposed emergency rulemaking." The court determined the notice for the meeting was properly posted at the Board's offices. The trial court also determined in preparation for the meeting "and in promulgating the Emergency Rules, Director Behrens complied with the 'Rule Impact Statement' that is required by 25 O.S. 2011, § 253." The Special Meeting held on October 7, 2016, "was attended by various Media organizations, as well as numerous attorneys, including Plaintiffs' attorney, Brian Morton." ¶10 The Board approved five emergency rules at the meeting. The Governor approved four of the emergency rules the same day as the meeting and approved the fifth emergency rule three days later on October 10, 2016. These emergency rules were published by the Secretary of State in the official State Registry on November 15, 2016. ¶11 The trial court rejected plaintiffs' claim that the Special Meeting was not properly called. Email communications between the Board's Director and members of the Board showed that at least four members of the Board were in agreement to hold the meeting. The court found the requirements in the Board's rules for calling a meeting were satisfied. ¶12 Plaintiffs also claimed the advance public notice of the Special Meeting was not properly given to the Secretary of State as required by 25 O.S.2011 § 311 (11). On October 7, 2016, the version of 25 O.S. § 311 (11) in effect stated in part as follows. Special meetings of public bodies shall not be held without public notice being given at least forty-eight (48) hours prior to said meetings. Such public notice of date, time and place shall be given in writing, in person or by telephonic means to the Secretary of State or to the county clerk or to the municipal clerk of the public bodies in the manner set forth in paragraphs 2, 3, 4, 5 and 6 of this section. The Director testified he was aware of a duty to give notice to the Secretary of State, and that neither he nor anyone else on behalf of the Board took any action to provide notice to the Secretary of State. The Director testified he "negligently failed to send the email" for the notice of the hearing to the Secretary of State. ¶13 The trial court's judgment states defendants' motion for summary judgment was previously denied "because of the existence of fact issues regarding the 'willfulness violation' standard set out in 25 O.S.2011, § 313." The trial court noted that 25 O.S. 2011, § 313 of the OMA provides: "Any action taken in willful violation of this act shall be invalid." The trial court's judgment states that whether a willful violation of § 311 (11) occurred when the Board failed to give notice to the Secretary of State is an issue of fact. The court found a willful violation occurred and stated the factual basis for this finding was based upon four factors. A. Director Behrens testified that he was aware of the duty to give notice to the Secretary of State;B. Director Behrens testified that neither he nor anyone else on behalf of the BoT [the Board] took any steps to provide notice of the Special Meeting to the Secretary of State;C. Director Behrens testified that he "did not send an email" to the Secretary of State, and that he has "no memory of telling them (i.e., the Office of the Secretary of State) of the meeting;"D. Director Behrens further testified that he had "negligently failed to send the email" to the Secretary of State. The trial court stated the issue of a "willful violation" in 25 O.S. § 313 presented an issue of fact, and this fact should be analyzed using the holdings of two opinions by the Court of Civil Appeals: In the Matter of the Appeal of the Order Declaring Annexation Dated June 28, 1978, issued by Gene Frasier, 1981 OK CIV APP 57, 637 P.2d 1270, and Wilson v. City of Tecumseh, 2008 OK CIV APP 84, 194 P.3d 140. ¶14 The trial court found the failure of the Board to notify the Secretary of State a willful violation, and then stated the Emergency Rules adopted by the Board at the Special meeting were invalid. The journal entry of judgment states: "This journal entry is to be considered a final order, as the Journal Entry disposing of all claims at issue in this matter." The journal entry states a declaratory judgment is granted to the plaintiffs as sought in their petition. II. Appeal and Certiorari Issues ¶15 Defendants appealed and raised two assignments of error as separate grounds to reverse the trial court's judgment. One assignment of error is based upon plaintiffs invoking "another action pending between parties for the same claim," and "res judicata, collateral estoppel, judicial estoppel, and/or issue preclusion." One part or aspect of these defenses was raised in their summary judgment motion when they made a combined mootness, standing, and estoppel argument. They argued plaintiffs were required by Martin v. Phillips, 2018 OK 56, 422 P.3d 143, to raise the issue of improper testing procedure and equipment as a defense in plaintiffs' previous criminal cases.5 Defendants raised this issue again in their motion for judgment as a matter of law filed on the day of the evidentiary hearing,6 and again on appeal. This assignment of error on appeal was not adjudicated by the Court of Civil Appeals, and the appellate court focused solely on the second assignment of error. ¶16 The second assignment of error challenged the trial court's construction of the Open Meeting Act, and the appellate court reversed the judgment of the District Court. The appellate court concluded no willful violation of the OMA occurred because the evidence showed the Director's conduct was accidental and constituted negligent noncompliance with the Act. Defendants argue the appellate court's holding is that a willful violation of the OMA requires an official's intent to violate the Act. The appellate court concluded the Director's conduct was not willful, and reversed the trial court's judgment. ¶17 Plaintiffs sought certiorari for review of the appellate opinion. Plaintiffs' claims on certiorari may be summarized as follows: (1) The appellate opinion conflicts with District Court's findings of fact; (2) The appellate opinion conflicts with Excise Board of Greer County v. Rogers, 1984 OK 95, 701 P.2d 754, and Fraternal Order of Police v. City of Norman, 2021 OK 20, ¶ 18, 489 P.3d 20; (3) The appellate opinion conflicts with Okmulgee County Rural Water District No, 2 v. Beggs Public Works Authority, 2009 OK CIV APP 51, 211 P.3d 225 (Division III); and (4) The appellate opinion conflicts with purposes of the OMA because (a) the Act should be construed liberally, and (b) the appellate opinion places a burden on the public to show improper motive or intent of public officials when applying the Act. III. Standard of Review ¶18 The arguments on certiorari involve the concept of willful conduct by an official when the official fails to provide notice as required by the OMA. Defendants' principal appellate brief recites evidence before the trial court, and then concludes with a statement the Director did not willfully violate the OMA. Defendants rely upon Wells v. Oklahoma Roofing & Sheet Metal, L.L.C., 2019 OK 45, ¶ 15, 457 P.3d 1020, for the proposition that the definition of willful "carries with it some degree of 'intent' to violate the Act." Defendants argue the Director sent out a group email including a Notice and Agenda for a special meeting, but he negligently failed to include the Secretary of State as a recipient of an email notification. ¶19 Defendants argue the trial court improperly concluded "even negligent unintentional acts meet that definition [of willful for a violation of the OMA]." Defendants' argument concludes with an assertion that a contested question of law construing a statute is reviewed de novo and the trial court's holding that a willful violation occurred should be reversed on appeal. Defendants' response on certiorari adds additional argument concerning the nature of willful conduct, and relies upon language in the opinion by the Court of Civil Appeals. ¶20 Plaintiffs' appellate brief argues the determination of the Director's willfulness was a trial court's adjudication of fact, and an "issue of fact that must be analyzed under the cases of In the Matter of the Appeal of the Order Declaring Annexation Dated June 28, 1978, Issued by Gene Frasier, 1981 OK CIV APP 57, 637 P.2d 1270, and Wilson v. City of Tecumseh, 2008 OK CIV APP 84, 194 P.3d 140." Plaintiffs' appellate brief also argues as a general proposition our de novo appellate review is proper for an issue of law, and they rely upon two of our opinions for this concept.7 ¶21 In one sense, every appeal requires judicial explanation and application of one or more principles of law, and a principle of law presented as an issue or question for appellate adjudication receives de novo review.8 We agree with the parties' reasoning that an interpretation of a statute is a question of law, and subject to our independent and non-deferential examination applying a de novo standard of review.9 While this reasoning is correct concerning the parties' request for this Court to determine meaning of statutory language in the OMA, the reasoning is incomplete on a main issue framed by the parties, i.e., methods for reviewing a trial court finding of fact. ¶22 The parties argue whether the evidence before the trial court showed willful conduct by the Director concerning a violation of the OMA. They do not use phrases such as "insufficient evidence" or "sufficiency of evidence," but their arguments on appeal and certiorari concern whether evidence in the trial court was sufficient to show willful conduct. They label a trial court's adjudication of a willful violation of the OMA as an adjudication on an "issue of fact" in a declaratory judgment proceeding. The District Court denied a motion for summary judgment and stated an evidentiary hearing was necessary on an issue of fact. An issue of fact or mixed issue of law and fact usually requires a deferential appellate standard when a fact was controverted and adjudicated by a District Court.10 But there are exceptions which include, for example, certain questions of law and fact,11 as well as a challenge to sufficiency of evidence for a prima facie case which is the controversy before the Court.12 ¶ 23 An appellate standard of review for an assignment of error is based upon the type of the proceeding, nature of the decision, and the trial court procedural context with its particular judicial discretion exercised.13 Generally, a declaratory judgment proceeding is neither strictly legal nor equitable and assumes the character of the nature of the controversy.14 In the context of a request for declaratory relief, a claim of insufficient evidence ordinarily requires the parties to identify the nature of the controversy adjudicated and then apply the correct standard of review for appellate examination of evidence for the specific controversy.15 The nature of the decision adjudicating plaintiffs' petition is a District Court judgment determining whether plaintiffs possessed rights created by statutes which could be enforced in an action plaintiffs alleged was authorized by statute.16 ¶24 Generally, a trial court's finding of a fact in a trial will not be reviewed on appeal as a ground to reverse the judgment when evidence in the record is sufficient to support the judgment rendered.17 However, a District Court's finding there is an absence of sufficient facts necessary to prove a legal element turns the issue into one of law and is reviewed de novo; i.e., whether the evidence submitted fails as a matter of law in showing a necessary legal element.18 Similarly, we have explained a denial of a directed verdict is reviewed de novo,19 and a District Court's finding the presence of sufficient facts necessary to prove a legal element will turn the issue into one of law when one party asserts the other party failed to demonstrate a prima facie case for recovery.20 Defendants filed a motion for a judgment as a matter of law which challenged whether evidence showed a prima facie case for plaintiffs. ¶25 The controversy before us is whether there was proof showing willful conduct by the Director who failed to provide notice of the special meeting to the Secretary of State. Our appellate review is not de novo merely because the OMA statutory phrase "willful violation" must be defined and applied, but because the assignment of error is whether the evidence showed a prima facie case of willful conduct as an issue of law.21 IV. Willful Conduct and Violation of the OMA ¶26 Plaintiffs argue: If an official knows he or she has an official duty and fails to perform the duty, then the official's failure to perform is one type of knowing and intentional conduct, and a willful violation. Important to plaintiffs' view is a sentence in their petition for certiorari where they comment that willful conduct includes conduct by an official who "knew or should have known" his or her conduct would violate a statute. Plaintiffs focus on the Director's knowledge that a statutory duty exists, combined with a should-have-known concept applied to the fact the Director was unaware he omitted to include the Secretary of State's email address on a group or individual email giving notice of the Board's meeting. ¶27 Defendants argue: If an official negligently fails to perform an official duty, then this failure is not intentional conduct and not a willful violation of the statute. Defendants' argument has an element similar to plaintiffs' argument, i.e., focusing on knowledge possessed by an official. Defendants cite the transcript of the hearing and they rely on the Director's knowledge and awareness of his own conduct when performing the requirements of the OMA, a failure to include the email address for the Secretary of State in an email. ¶28 The defendants' argument may be summarized as follows. Defendants point to the Director's self-assessment of negligence and they cite the Director's lack of awareness of factual circumstances as a determinative element for an adjudication stating willful conduct did not occur. They argue a willful violation of the OMA requires conduct "substantially higher in magnitude than simple inadvertence in negligence." They argue a willful violation of the OMA should be based upon "premeditation" and "intentional wrongdoing," and they rely on a statute in Oklahoma's criminal code defining "willfully", 21 O.S.2011 § 92,22 language in the OMA making a willful violation of the OMA a misdemeanor, and our discussion of intentional torts in the context of workers' compensation law.23 ¶29 The controversy before us is controlled by the legislatively-controlled purpose and language of the OMA. Legislative intent controls statutory interpretation.24 We examine a whole legislative act in light of its general purpose and object,25 and give effect to the legislature's intent by construing and applying the language in a manner which does not destroy the obvious purpose and design of the statutory language.26 The Legislature has stated the Open Meeting Act is designed to effectuate "the public policy of the State of Oklahoma to encourage and facilitate an informed citizenry's understanding of the governmental processes and governmental problems." 25 O.S.2011 § 302. The Legislature effectuated this public policy by creating both a criminal penalty and an invalidating provision as part of the OMA: (1) Any person or persons willfully violating any of the provisions of the OMA shall be guilty of a misdemeanor;27 and (2) Any action taken in willful violation of the OMA shall be invalid.28 Although not specifically stated by defendants, their argument distinguishes between (1) negligent misdemeanor conduct and (2) willful misdemeanor conduct, and they argue only the latter leads to an invalidation of rules by the Board. Their argument and authority draws on similar language of willfulness for the purpose of a misdemeanor in 25 O.S. § 314 and willful conduct in 25 O.S. § 313 used for the purpose of invalidating actions taken at a public meeting. Section 313 and section 314 both relate willful conduct to conduct which violates the OMA. ¶30 Historically, a statute could denounce the mere doing of an act as criminal, and a statute could also denounce as criminal the willful doing of an act. The first type of statute included those offenses classified as mala prohibita where intent was imputed.29 The second type was usually described as cases where "a specific wrongful intent, that is, actual knowledge of the existence of obligation and a wrongful intent to evade it, is of the essence."30 A mala prohibita statute was usually described as a form of police regulation, intended to protect the public or to promote the general welfare, and a criminal intent was not considered a necessary element, unless so declared by the legislature in apt words.31 One context for this distinction occurred when the U. S. Supreme Court explained an often-recognized difference between (1) a crime requiring mens rea and (2) public welfare offenses requiring no mens rea and characterized as malum prohibitum.32 ¶31 The High Court explained that many public welfare offenses "depend on no mental element but consist only of forbidden acts or omissions." Liparota v. United States, 471 U.S. 419, 432, 105 S. Ct. 2084, 85 L. Ed. 2d 434 (1985) (quoting Morissette v. United States, 342 U.S. 246, 251-252-253, 72 S. Ct. 240, 244, 96 L. Ed. 288 (1952)). Importantly, the Court noted the existence of reasonable distinctions in the knowledge of actors charged with violating various public welfare regulations. For example, in Liparota the Court discussed knowledge of the actor in different types of public regulatory statutes, and explained "a corporate officer could violate the Food, Drug, and Cosmetic Act when his firm shipped adulterated and misbranded drugs, even 'though consciousness of wrongdoing be totally wanting.'"33 However, the Court then explained the criminal liability for using, transferring, acquiring, altering, or possessing food stamps in an unauthorized manner could not be compared to the selling of adulterated drugs, and the Court rejected the Government's argument that Congress had no reason to impose a "knowledge of illegality requirement" for unauthorized possession of food stamps.34 Generally, there exists a presumption that criminal liability should attach only when a defendant knows the facts that make his or her conduct illegal, but circumstances may place a duty requiring the defendant to know the characteristics of his or her conduct that brings it within the scope of the statute controlling the conduct.35 But certain factual mistakes by the actor may provide a defense to a charge of violating a statute,36 and the concept has been recognized as a "mistake of fact" defense relevant to a crime which has criminal intent as one of its elements, i.e., the mistake of fact negates the existence of a mental state essential to the crime charged.37 A court may explain this defense as an honest mistake of fact inconsistent with criminal intent based upon facts showing the actor's reasonable belief for an honest mistake.38 ¶32 Although the distinction between malum in se and malum prohibitum statutes may be improper for some modern-day controversies,39 the distinction helps explain why legislative bodies were concerned in some instances of public regulation statutes with making intent, or willfulness, or the knowledge of the actor as an element for a wrongful act traditionally classified as a mala prohibita public regulation. For example, a lack of awareness, mistake, or honest inadvertence was mentioned more than a hundred and seventy-five years ago when a court commented on a public official's willful neglect of duty and observed the official knew what was asked of him, knew what he refused, and the neglect could not be excused because there were no facts showing surprise, inadvertence, or misapprehension on the part of the official.40 ¶32 In modern times we have statutory schemes which combine civil remedies with criminal penalties. The degree of culpability labeled as negligence, gross negligence, willful conduct, and intentional conduct may all be included and prohibited by a single statutory scheme.41 The OMA combines a civil remedy with a criminal penalty. Section 313 states any action taken in willful violation of the OMA shall be invalid, and section 314 states both a person willfully violating the OMA shall be guilty of a misdemeanor and a person may bring a civil suit based upon a violation of the OMA. Both sections 313 and 314 reference willful violations. In 1981 our Court of Criminal Appeals noted the criminal penalty was a misdemeanor provision, and a crime classified as malum prohibitum.42 Therein parties claimed no proof of criminal intent existed, and the court noted the record showed a willful failure to comply with the OMA, and proof beyond a showing of willfulness was not statutorily required.43 A few years later in 1992 the Court of Criminal Appeals again noted the misdemeanor was a "mala prohibita offense," and the offense was based upon "a willful violation of any provisions of the Act."44 One of the Director's arguments rests upon the idea that willfulness has the same definition for (1) the purpose of a civil invalidation pursuant to section 313 sought in a civil legal action brought pursuant to section 314, and (2) a criminal misdemeanor action pursuant to section 314. ¶33 In summary, defendants argue the combined civil and criminal remedial scheme in the OMA uses a consistent definition for both civil and criminal willfulness, and a reasonable and honest single mistake of fact by the Director giving an OMA notice is a defense to a claim of both civil and criminal willfulness because the purpose of the OMA was not frustrated by the Director's mistake. ¶34 When we have examined the concept of an official's willful conduct in the context of a statutory duty we have explained our definition of willfulness has varied based upon the statutes in question and the intent and purpose of the statutory language.45 Similar to the analysis used by courts determining whether the purpose of a statutory scheme is frustrated by an actor's reasonable belief and honest mistake, we also examine whether the purpose of the OMA is frustrated by a definition for a willful violation of the Act. In Fraternal Order of Police v. City of Norman, 2021 OK 20, 489 P.3d 20, we discussed willfulness for the purpose of a violation of the OMA. Willfulness does not require a showing of bad faith, malice, or wantonness, but rather, encompasses conscious, purposeful violations of the law or blatant or deliberate disregard of the law by those who know, or should know the requirements of the Act. Notice of meetings of public bodies which are deceptively vague and likely to mislead constitute a willful violation. Id. 2021 OK 20 at ¶ 18 (quoting Rogers v. Excise Board of Greer County, 1984 OK 95, 701 P.2d 754, 761). We explained the public policy of the OMA is defeated if the required notice is deceptively worded or materially obscures the stated purpose of the meeting. Fraternal Order of Police, 2021 OK 20 at ¶ 9, 489 P.3d at 24. We stated therein a notice and agenda which listed adopting or rejecting a budget on the agenda, but did not give any notice of new amendments for reallocation of funds in the budget was deceptively vague. Id. 2021 OK 20, at ¶¶ 17-19, 489 P.3d at 26. ¶35 Plaintiffs rely upon language in appellate opinions stating a deceptively worded notice or agenda violates the OMA by obscuring the purpose of a public meeting. For example, plaintiffs rely upon Okmulgee County Rural Water Dist. No. 2 v. Beggs Public Works Authority, 2009 OK CIV APP 51, 211 P.3d 225, and its reliance upon Haworth Board of Education of of Independent School Dist. No. I--6 v. Havens, 1981 OK CIV APP 56, 637 P.2d 902. Haworth stated a public policy advanced by the OMA "is defeated if the required notice is deceptively worded or materially obscures the stated purpose of the meeting." Id. 637 P.2d at 904. Similarly, they rely upon Wilson v. City of Tecumseh, 2008 OK CIV APP 84, 194 P.3d 140, and its conclusion an agenda item specifying "employment" of an employee was insufficient to inform a person of ordinary education and intelligence that two public entities were considering awarding a $30,000.00 bonus to the employee. ¶36 Plaintiffs also rely upon In the Matter of the Appeal of the Order Declaring Annexation Dated June 28, 1978, Issued by Gene Frasier, 1981 OK CIV APP 57, 637 P.2d 1270, where a school board and acting County School Superintendent held several meetings without both the notices and agendas required by the OMA. Plaintiffs' reliance upon this opinion is misplaced. The appellate court's analysis included the following statement: "we are well-convinced that they knew or should have known the Act's requirements and blatantly or deliberately disregarded the law." Id. 637 P.2d at 1275 (emphasis added). The phrase "and blatantly or deliberately disregarded the law " references what officials did, the character of their conduct, in combination with what officials knew or should have known. The appellate court did not equate (1) an official's mere knowledge of his or her duty "to know or should know" the OMA with (2) that which is willful. The concept of willfulness was applied to the official's conduct. Because this know-or-should-know duty always exists for an official it cannot be the determinative factor for when an official's conduct is willful in failing to follow a statute. It has been a long-established rule of law that public officials are presumed to do their duty.46 One aspect to this presumption is a related long-held presumption that all officials know or should know the law they are charged to enforce.47 Because of these legal presumptions, plaintiffs' argument is essentially any statutory misstep by an official in applying the OMA is necessarily willful conduct because officials are charged with knowing the law; and if an official claims to be ignorant of the law, then the official has also engaged in willful conduct by remaining ignorant of the official's statutory duties when violating a statute. In other words, a failure to follow a statute in the OMA will always be some type of willfulness if we were to adopt plaintiffs' views. Rogers v. Excise Board of Greer County, supra, did not expand upon the concept of blatant conduct violating a statute and a party showing an official's willfulness: "Willfulness does not require a showing of bad faith, malice, or wantonness, but rather, encompasses conscious, purposeful violations of the law or blatant or deliberate disregard of the law by those who know, or should know the requirements of the Act." Rogers, 701 P.2d at 761. The descriptive words: "purposeful," "blatant," and "deliberate" reference conduct that violates a statute. These descriptive terms are not used to describe either the presence or character of the official's knowledge of law and legal obligations. Again, officials always know or should know the law when performing any official act, and it is the character or nature of that act the official performs in the context of particular factual circumstances which determines whether the conduct shows or demonstrates a blatant, conscious, deliberate, purposeful, or willful violation of a statute the official knows or should know. ¶37 Plaintiffs' argument based upon these opinions includes a comparison and characterization of two results: (1) A deceptive notice results in a failure to properly inform the public of a meeting; and (2) A failure to send a notice to the Secretary of State results in a failure to properly inform the public of a meeting. The two results are equated for the purpose of defining a willful violation of the OMA. Clearly, the OMA requires more than a mere violation of the Act to invalidate action of officials: "Any action taken in willful violation of this act shall be invalid." 25 O.S., 2011 § 313 (emphasis added). Plaintiffs and the trial court recognize this principle and point to the Director knowing the Board was required to give notice to the Secretary of State. ¶38 We disagree with one of defendants' assertions that evidence must show an official factually intended to violate the OMA before actions at public meetings are judicially invalidated due to OMA noncompliance. We also disagree with plaintiffs' assertion a willful violation may be shown by merely pointing to (1) an official's knowledge of a statutory duty and (2) a result which is an actual failure to perform this duty. Our opinions have uniformly stated a willful violation for the purpose of the OMA is conduct that is "conscious," "purposeful," "blatant" or "deliberate" disregard of the law. Fraternal Order of Police v. City of Norman, supra. Answering questions such as why an official's notice did not comply with the OMA, manner of noncompliance, frequency of noncompliance, effect of noncompliance, and extent of noncompliance are important in the judicial determination whether a willful violation of the OMA occurred. Answering this question requires an examination of the record and its application to the de novo issue whether a prima facie case was presented. ¶39 The official involved, the Director of the Board, testified he was notified on September 29th of an order in Sample which finalized the case. He explained the perceived need by certain officials for the Board to respond and immediately create new rules. He testified concerning several communications with members of the Board and General Counsel for the Governor of Oklahoma during the first week of October 2016. The Director sent emails to Board members to determine availability for a special meeting and the content of proposed emergency rules. In conversations with the General Counsel for the Governor it "was clear that waiting three weeks was not an option," "this was a priority for the Governor's office," "that this issue be handled quickly," "and I needed to get it done quickly." Tr. at 25.48 The special meeting was scheduled for a few days later on October 7, 2016. ¶40 He indicated that between September 29th and October 7th the media was reporting on issues related to Sample and alcohol testing by law enforcement. The Director "dealt with probably three to five media requests per day including "on-camera interviews, it was a very busy time with the media." Tr. at 26. He testified "there was -- this was a public safety concern because there were no -- arguably, there were no viable test methods available to law enforcement for impaired driving purposes." Tr. at 36.49 ¶41 Between September 29th and October 7th the Director coordinated drafting the emergency rules with the members of the Board, Governor's Office, and the Department of Public Safety by "sending out drafts, getting comments back and incorporating those" in the rules. Tr. at 26. He also coordinated input from the Oklahoma District Attorneys Council and incorporated this input into the rules. ¶42 The Director posted a notice and agenda of the meeting at the principal place of business of the Board where it meets. He posted forty-eight hours in advance of the meeting. He notified members of the Board and people who had requested notice of the rule-making. He emailed the notice and agenda to individuals, entities, organizations, and news media who requested notice. He stated "that's probably 30 people, 30 individual email addresses, I sent that to that group that I keep." Plaintiffs' counsel was on the list of individuals to receive notice of the hearing. ¶43 The Director testified that at the time of providing notice of the hearing by the group email he thought he had given notice of this email to the Secretary of State: "And I at least thought I sent it to the Secretary of State's Office." Tr. at 30. After given notice of plaintiffs' action, the Director discovered he had not given an actual email notice of the meeting to the Secretary of State. The Director testified his usual and ordinary practice for giving notice to the Secretary of State was by email to an email address furnished by the Secretary of State for such purpose. "That was part of the process that I do, I mean, I had had special meetings before a number of times. In this Instance I -- with all the things that I talked about having to -- being done from September 29th until October 7th, I -- sending that notice to the Secretary of State slipped through the cracks. Tr. at 44. His usual practice was to send an email to the Secretary of State when he sent an email to the group of individuals interested in the meeting. Tr. at 44. He testified that he did not intentionally fail to send a notice to the Secretary of State. He stated he was negligent when failing to provide the notice. He was asked if he sent an email to the Secretary of State with the notice and agenda of the meeting and he responded: "I did not." Tr. at 45. ¶44 The Director testified he had conversations with the Secretary of State's office immediately prior to the meeting, and "we talked about the emergency rules themselves, filing them, [and] the rule process." Tr. at 27. They also "talked about the dates of the meetings and contents of the meetings," but the Director did not have any memory of informing anyone in the office of the Secretary of State about the time and date of the meeting on October 7, 2016. Tr. at 45-46. ¶45 The Director's testimony characterizes his conduct as negligence when failing to notify the Secretary of State. His testimony is essentially an explanation of his lack of knowledge or self-awareness concerning his own actions and conduct when sending emails notifying the media and individuals of the special meeting: "I...thought I sent it to the Secretary of State's Office," when in fact he did not send the email to the Secretary of State. ¶46 The evidence before the trial court was that the Director sent the notice of the special meeting to several individuals by email. This evidence also included the Director stating he routinely sends notices for special meetings to an email address maintained by the Secretary of State for the purpose of receiving notices of meetings. He stated he thought he notified the Secretary of State of this specific meeting, and he was unaware he had not sent the email until receiving notification of plaintiffs' legal action. He provided his view why the notice to the Secretary of State "slipped through the cracks." The only evidence presented to show a willful or purposeful conduct was the Secretary of State not receiving the notice, the Director's statement he was aware of the statute requiring a notice filed with the Secretary of State, and the Director usually filed such notices. ¶47 The trial court heard this evidence and made findings on the issue of the Director's willful conduct. One finding states neither the Director nor anyone else "took any steps to provide notice of the Special Meeting to the Secretary of State." Uncontradicted testimony by the Director stated he sent a group email notice of the meeting, this type of group email by him ordinarily has the Secretary of State as a recipient or he sends the email at the same time to the Secretary of State, but the Director failed to add the Secretary of State's email address. The Director testified this email was the step he ordinarily took to inform the Secretary of State, but its execution was faulty due to a mistake of fact related to the Director's awareness of his conduct while busily engaged with his duties. The trial court focused on the Director's assessment of his actions and the result of the Secretary of State not receiving notice, and used the assessment and result as evidence no steps were taken to provide notice. ¶48 The trial court made an express finding of willful conduct by the Director based upon its finding that Director testified he "negligently failed to send the email." The issue of an actor's knowledge and awareness occurs in both negligence and willfulness classifications, but they are not identical. The concept of what an actor knows or should know occurs in negligence cases.50 In negligence jurisprudence an actor's knowledge may involve issues of foreseeability, defining a duty, or an element of causation.51 We have approved application of the Restatement (Second) of Torts, § 289 (1965),52 and it states an actor should exercise such attention, judgment, knowledge, and memory of the circumstances as a reasonable person would have, as well as the superior knowledge the actor possesses.53 When the actor is required to know and act, he or she may nevertheless negligently fail to know, look, comprehend, and observe what is visible,54 and the actor's forgetfulness of knowledge and inattention may occur by simple inadvertence in a case of ordinary negligence55 or by "utter forgetfulness of legal obligations" in a case of gross negligence."56 The flow of plaintiffs' argument is that an official sending an OMA notice, such as the Director, should know the actual recipients of the notice, and a failure to always know the recipients with one hundred percent accuracy is a type of willful conduct. ¶49 Characterizing a party's degree of negligence or intentional conduct is generally understood as an assessment on a continuum of culpability or tort liability.57 For example, many years ago one court stated "ordinary and gross negligence differ in degree of inattention, while both differ in kind from willful and intentional conduct which is or ought to be known to have a tendency to injure."58 This view was recently explained by our Court when we stated "It is well-settled that the common law divides actionable tortious conduct into two categories: (1) accidental and (2) willful acts that result in intended or unintended harm."59 ¶50 Several years ago we stated gross negligence was substantially higher in magnitude than simple inadvertence in negligence, and also in a particular application gross negligence may fall short of an intentional wrong. Graham v. Keuchel, 1993 OK 6, 847 P.2d 342, 362. However, gross negligence may be equated with one type of willful conduct when the actor's conduct "demonstrates such a total disregard of another's rights that it may be equated with evil intent or implies such entire want of care or recklessness of conduct that it (a) can be likened to positive misconduct or (b) evinces a conscious indifference to predictable adverse consequences." Id. ¶51 In summary, gross negligence may be equated with one type of willful conduct in tort. The trial court did make a finding of negligence by the Director, but negligence is ordinarily associated with types of inadvertence and not types of willful conduct. Assuming for the purpose of argument a tort standard for gross negligence could be used to show a willful violation of the OMA, the trial court made no finding of gross negligence nor did it use such a concept to make a finding of a willful violation of the OMA. ¶52 Upon examination of the trial court's findings and the trial record for (1) the defendants' asserted reason for noncompliance, (2) manner of noncompliance, (3) frequency of noncompliance, (4) extent of noncompliance, and (5) effect of noncompliance,60 we ask whether the Director's failure to send the notice to the Secretary of State frustrated the purposes of the OMA. No party has suggested that any citizen was waiting for the Secretary of State's notice as a means to participate in the meeting. The record states the Director did not know of the failure to provide notice until the plaintiffs' legal action occurred. In other words, no one complained to the Director about reliance upon the Secretary of State's notice. The meeting was held with a notified media and plaintiffs' counsel. Many email addresses appeared on the group email which the Director typically used to send to the Secretary of State, and the Director failed to notice the address for the Secretary of State was missing. ¶53 We need not determine whether a 25 O.S. § 313 willful violation of the OMA has the same meaning as a willful violation of the OMA for the purpose of defining a misdemeanor in 25 O.S. § 314. We also need not expressly incorporate into 25 O.S. § 313 various tort standards for willfulness discussed by the parties. Our opinions such as Fraternal Order of Police v. City of Norman, supra, explain a willful violation of the OMA requires conduct that is "conscious," "purposeful," "blatant" or "deliberate" disregard of the law. ¶54 We agree with defendants the Director's failure to include the Secretary of State's name on a group email to several email addresses on one occasion did not frustrate the purpose of the OMA at a meeting when (1) individuals and entities desiring to be notified of such were notified, (2) the reason for the failure to send the notice is supported by testimony indicating a single honest mistake while trying to send the notice, and (3) the failure to provide actual notice to the Secretary of State occurred during unusual circumstances involving a perceived need for timely regulations concerning public safety. We agree with defendants the evidence was insufficient to show the Director's willful violation of the OMA notice provision requiring notice sent to the Secretary of State. The District Court judgment is reversed on this issue. V. Conclusion, Reversal, and Remand ¶55 We hold the evidence was insufficient to make a prima facie case that the Board's Director willfully violated the Open Meeting Act when he failed to send the email notice of the special meeting to the Secretary of State. The District Court's declaratory judgment finding an Open Meeting Act willful violation is reversed. The District Court's determination that the Board's emergency rules were invalid based upon a willful violation of the OMA is also reversed. ¶56 Defendants also raised an alleged error of the District Court when it denied their defense combining mootness, standing, and estoppel theories. This assignment of error was not decided by the Court of Civil Appeals and defendants did not raise it on certiorari. We do not address this assignment of error. ¶57 The District Court judgment rejected plaintiffs' claim asserting the Board's Special Meeting was not properly called. Plaintiffs did not appeal this disposition and it is not before us on certiorari. ¶58 The opinion of the Court of Civil Appeals is vacated. The judgment of the District Court is reversed, and the controversy is remanded to the District Court for additional proceedings consistent with the Court's opinion. ¶59 CONCUR: DARBY, C.J.; KANE, V.C.J.; KAUGER, WINCHESTER, EDMONDSON, COMBS, and ROWE, JJ. ¶60 DISSENT: GURICH, and KUEHN, (by separate writing), JJ. FOOTNOTES 1 Prima facie evidence establishes a given fact when showing a necessary element to a cause of action adjudicated by the trial court's judgment. State, ex rel. Pruitt v. Native Wholesale Supply, 2014 OK 49, n. 6, 338 P.3d 613, 619 (citing Sides v. John Cordes, Inc., 1999 OK 36, ¶ 14, 981 P.2d 301, 306 (a prima facie case is made by that quantum of proof which, if unexplained or uncontradicted, is sufficient to establish a given fact and to uphold a judgment in favor of the issue which it supports, but which may be refuted by other evidence)); cf. Dan B. Dobbs, Paul T. Hayden and Ellen M. Burdick, The Law of Torts, § 124 (2d ed., as updated 2018) (explained a "prima facie case for negligence" by identifying the elements for the cause of action of negligence). 2 25 O.S. 2011, §§301-314, inclusive and as amended. Section 301 states: "This act shall be known as the Open Meeting Act." 3 Oklahoma Administrative Procedures Act (OAPA), 75 O.S. 2011 §§ 250-323 (as amended). 4 A trial judge is not required to hold a District Court Rule 5 pretrial conference "in cases where jury has been waived but he [or she] may do so." 12 O.S.2011, Ch. 2, App. Rule 5 (A) (Rules for District Courts). 5 Defendants' motion for summary judgment, 08/01/2019, at p.18; Defendants' Brief In Chief on appeal, 06/24/2020, at p. 17. 6 Evidentiary Hearing Trial Brief and Motion for Judgment as a Matter of Law, 10/31/2019, O.R. at 304, 321. 7 Appellees' appellate answer brief, at p. 2, citing Bank of the Wichitas v. Ledford, 2006 OK 73, ¶ 20, 151 P.3d 193, 111 ("Questions of law are reviewed by a de novo standard."); Barber v. Barber, 2003 OK 52, ¶ 5, 77 P.3d 576, 578 (a matter of law is reviewed de novo on appeal). 8 Christian v. Gray, 2003 OK 10, ¶ 41, 65 P.3d 591, 608) ("An issue of law decided by a trial court is reviewed by this Court de novo.")(citing Brown v. Nicholson, 1997 OK 32, n. 1, 935 P.2d 319, 321; Kluver v. Weatherford Hosp. Auth., 1993 OK 85, 859 P.2d 1081, 1083). 9 State ex rel. Okla. State Bd. of Med. Licensure and Supervision v. Rivero, 2021 OK 31, ¶ 42, 489 P.3d 36, 53. 10 I. T. K. v. Mounds Public Schools, 2019 OK 59, ¶¶10-11, 451 P.3d 125, 131-132 (court discussed review of issues of law, issues of fact, and issues of mixed law and fact, and in an action at law when reviewing a finding of fact made by a District Court we use a clearly erroneous standard and the presence of competent evidence in the record to support the judgment, as well as a clear-abuse-of-discretion standard when appropriate); Bruner v. Timberlane Manor Limited Partnership, 2006 OK 90, ¶ 8, 155 P.3d 16, 20 ("Where the facts are controverted, mixed questions of fact and law may require deferential review standards.") (citing Feightner v. Bank of Okla., 2003 OK 20, ¶ 3, 65 P.3d 624, 627). 11 Calvert v. Swinford, 2016 OK 100, ¶ 19, 382 P.3d 1028, 1036; cf. Ellington v. Horwitz Enterprises, 2003 OK 37, ¶ 4, 68 P.3d 983, 984 (In workers' compensation jurisprudence we have similarly explained: "We have said that limitations issues involve mixed questions of fact and law and are reviewed as questions of law in this Court."). Additional exceptions to applying a deferential review may arise based upon the nature of the issue or the tribunal reviewed. See, e.g., Thompson v. Anchor Glass, 2003 OK 39, n.10, 73 P.3d 836, 838 (discussing de novo review of disputed jurisdictional facts necessary for an administrative adjudication). 12 See discussion and authority infra at ¶ 24. 13 Johnson v. CSAA General Insurance Company, 2020 OK 110, ¶9, 478 P.3d 422, 426. 14 Osage Nation v. Board of Commissioners of Osage County, 2017 OK 34, ¶ 55, 394 P.3d 1224, 1243 (citing Macy v. Oklahoma City School Dist. No. 89, 1998 OK 58, ¶ 11, 961 P.2d 804, 807). 15 See, e.g., Carpenter v. Carpenter, 1982 OK 38, 645 P.2d 476, 481-82 (Court explained [1] relief sought by the party was "in the nature of a judicial declaration of rights" pursuant to a divorce decree, [2] relief was properly treated as a cause of action for declaratory judgment pursuant to 12 O.S. § 1651, [3] the nature of the interests sought to be adjudicated were "interests cognizable in equity," and [4] the Court's application of the standard of review stated "the conclusion reached below neither against the clear weight of the evidence nor contrary to the established principles of equity."). 16 Plaintiffs' petition states their petition was brought pursuant to 12 O.S. § 1651, and 75 O.S. § 306. Section 306 states the "validity or applicability of a rule may be determined in an action for declaratory judgment," and this judgment "may be rendered whether or not the plaintiff has requested the agency to pass upon the validity or applicability of the rule in question." 75 O.S.2011 § 306 (A) & (D). 17 I. T. K. v. Mounds Pub. Schls., 2019 OK 59, ¶11, n.16, 451 P.3d 125, 132 (citing Central Plastics Co. v. Goodson, 1975 OK 71, ¶ 29, 537 P.2d 330, 335 (fact questions in dispute are insufficient to reverse a judgment on appeal where the judgment is supported by the trial court record). 18 I. T. K. v. Mounds Pub. Schls., 2019 OK 59, at n.17, 451 P.3d at 132 (citing Nelson v. Enid Medical Assocs., Inc., 2016 OK 69, ¶ 11, 376 P.3d 212, 217; Christian v. Gray, 2003 OK 10, ¶ 44, 65 P.3d 591, 609). 19 Badillo v. Mid Century Ins. Co., 2005 OK 48, ¶ 24, 121 P.3d 1080, 1092. 20 Gillham v Lake Country Raceway, 2001 OK 41, ¶ 7, 24 P.3d 858, 860 (a demurrer to the evidence or motion for directed verdict is granted only when the party opposing the motion has failed to demonstrate a prima facie case for recovery). 21 Cf. Computer Publications, Inc. v. Welton, 2002 OK 50, ¶ 6, 49 P.3d 732, 735 (on de novo review of a motion for a directed verdict the court regards as true all evidence favorable to the non-moving party and all reasonable inferences drawn therefrom, and disregards all evidence favorable to the moving party, "unless there is an entire absence of proof on a material issue"). 22 21 O.S.2011 § 92: "The term 'willfully' when applied to the intent with which an act is done or omitted, implies simply a purpose or willingness to commit the act or the omission referred to. It does not require any intent to violate law, or to injure another, or to acquire any advantage." 23 Defendants rely on Wells v. Okla. Roofing & Sheet Metal, L.L.C., 2019 OK 45, ¶ 15, 457 P.3d 1020. 24 Assessments for Tax Year 2012 of Certain Props. Owned by Throneberry v. Wright, 2021 OK 7, n.21, 481 P.3d 883 (citing Smicklas v. Spitz, 1992 OK 145, 846 P.2d 362; Matter of Phillips Petroleum Co., 1982 OK 112, 652 P.2d 283, 285). 25 Id. 2021 OK 7, n.23, 481 P.3d at 892 (citing City of Tulsa v. State ex rel. Public Employees Relations Bd., 1998 OK 92, ¶14, 967 P.2d 1214, 1220). 26 Id. 2021 OK 7, n.24, 481 P.3d at 892 (citing Independent School Dist. No. 52 of Okla. Cnty. v. Hofmeister, 2020 OK 56, ¶ 97 & n. 183, 473 P.3d 475, 516; Maule v. Indep. Sch. Dist. No. 9, 1985 OK 110, 714 P.2d 198, 203). 27 25 O.S.Supp.2014 § 314: A. Any person or persons willfully violating any of the provisions of this act shall be guilty of a misdemeanor and upon conviction shall be punished by a fine not exceeding Five Hundred Dollars ($500.00) or by imprisonment in the county jail for a period not exceeding one (1) year or by both such fine and imprisonment. B. Following a violation of this act, any person: 1. May bring a civil suit for declarative or injunctive relief, or both; and 2. If successful, shall be entitled to reasonable attorney fees. C. If the public body successfully defends a civil suit and the court finds that the suit was clearly frivolous, the public body shall be entitled to reasonable attorney fees. 28 25 O.S. 2011, § 313: Any action taken in willful violation of this act shall be invalid. 29 Hargrove v. U.S., 67 F.2d 820, 823, 90 A.L.R. 1276 (5th Cir. 1933) (citing Landen v. U.S., 299 F. 75 (6th Cir. 1924); U.S. v. Balint, 258 U.S. 250, 42 S. Ct. 301, 66 L. Ed. 604 (1922)). 30 Id. 67 F.2d at 823 (collecting cases including Potter v. U.S., 155 U.S. 438, 15 S. Ct. 144, 39 L. Ed. 214 (1894); Felton v. U.S., 96 U.S. (6 Otto) 699, 24 L. Ed. 875 (1877); Spurr v. U.S., 174 U.S. 728, 19 S. Ct. 812, 43 L. Ed. 1150 (1899)). 31 Earl T. Crawford, The Construction of Statutes § 275, at 555-556 (1940) (citing, State v. Lindberg, 125 Wash. 51, 215 P. 41 (1923); Hargrove v. U.S., supra note 29. 32 Staples v. U.S., 511 U.S. 600, 617, 114 S. Ct. 1793, 128 L. Ed. 2d 608 (1993) (when defining a public welfare offense, usually imprisonment is not imposed for a public regulatory offense; and noting "imprisonment for a crime that requires no mens rea would stretch the law regarding acts mala prohibita beyond its limitations") (citing Tenement House Dept. v. McDevitt, 215 N.Y. 160, 168, 109 N.E. 88, 90 (1915) (Cardozo, J.); People ex rel. Price v. Sheffield Farms--Slawson--Decker Co., 225 N.Y. 25, 32--33, 121 N.E. 474, 477 (1918) (Cardozo, J.); id., at 35, 121 N.E. at 478 (Crane, J., concurring)). Staples also noted that the court in State v. Lindberg, supra note 31, departed from the usual practice when the state court applied "the public welfare offense rationale to a felony." Staples, 511 U.S. at n. 14, 617; cf. Cheek v. United States, 498 U.S. 192, 199-200, 111 S. Ct. 604, 112 L. Ed. 2d 617 (1991) (Congress changed a common-law presumption by making specific intent to violate the law an element of certain federal criminal tax offenses, and the Court interpreted the statutory term "willfully" as used in the federal criminal tax statutes as carving out an exception to the traditional rule.) 33 Liparota v. U. S., 471 U.S. at 433 (quoting U. S. v. Dotterweich, 320 U.S. 277, 284, 64 S. Ct. 134, 138, 88 L. Ed. 48 (1943)), 34 Id. 35 United States v. Cox, 906 F.3d 1170, 1185 (10th Cir. 2018), cert. denied, 139 S. Ct. 2690, 204 L. Ed. 2d 1090 (2019), and cert. denied sub nom. Kettler v. United States, 139 S. Ct. 2691 (2019) (In a controversy involving two provisions of the National Firearms Act (26 U.S.C. §§ 5801--5872)(NFA), court noted "presumption that criminal liability should attach only when a defendant knows the facts that make his conduct illegal, by requiring that the defendant know the characteristics of a firearm that bring it within the NFA's ambit."). 36 Id. 906 F.3d at 1194-1195 (Pursuant to Staples v. United States, 511 U.S. 600 (1994) "certain factual mistakes (e.g., that a firearm isn't a 'firearm' for NFA purposes) may provide a defense to a charge of violating the NFA, but legal mistakes (e.g., that the NFA doesn't apply to locally made firearms) do not."). 37 See, e.g., 21 O.S.2011, § 152 (5) ("All persons are capable of committing crimes, except those belonging to the following classes:...(5) Persons who committed the act, or made the omission charged, under an ignorance or mistake of fact which disproves any criminal intent. But ignorance of the law does not excuse from punishment for its violation"). 38 U. S. v. Quarrell, 310 F.3d 664, 675-676 (10th Cir.2002) (when a defendant is charged with "knowingly" violating the Archaeological Resources Protection Act (16 U.S.C. §§ 470aa et seq.), the purpose of the Act is not frustrated by defendant raising the defense based on his reasonable belief that he was lawfully excavating on private land with permission and had an honest mistake of fact). 39 See, e.g., Marianne M. Jennings and Nim Razook, Duck When a Conflict of Interest Blinds You: Judicial Conflicts of Interest in the Matters of Scalia and Ginsberg, 39 U.S.F. L. Rev. 873, n.98, 901 (2005) (the American Bar Association, American Civil Liberties Union, and former U. S. Supreme Court Justice Scalia criticized malum prohibitum conflict of interest laws because they focused on the penultimate rather than ultimate (malum in se) act); Arias v. Lynch, 834 F.3d 823, 832 (7th Cir. 2016) (Judge Posner, concurring) (described crimes mala in se and mala prohibita and concluded "the distinction turns out to be paper thin"). 40 People v. Brooks, 1 Denio 457, 459, 43 Am.Dec. 704 (Sup.Ct.N.Y.1845) (A "willful neglect" of a statutory duty by a public official occurred when he refused to perform a mandatory duty, and the official "knew what was asked of him, he knew what he refused, [and] there was nothing like surprise, inadvertence or misapprehension" on the part of the official.); cf. Theodore Sedgwick, A Treatise on the Rules Which Govern the Interpretation and Construction of Statutory and Constitutional Law, 80-81 (2d ed. 1874, Fred B. Rothman & Co. reprint 1980) (discussing People v. Brooks, supra). 41 See, e.g., David M. Uhlmann, After the Spill is Gone: The Gulf of Mexico Environmental Crime, and the Criminal Law, 109 Mich. L. Rev. 1413, 1458, n.267 (2011) (the Clean Water Act alternates between civil and criminal penalties as the violations become more egregious, and discharges without fault are strict liability civil violations; negligent discharges are misdemeanors; grossly negligent discharges carry heightened civil penalties; and knowing discharges are felonies) (citing Clean Water Act §311(b)(7)(A), 33 U.S.C. §1321(b)(7)(A) (2006) (strict liability civil penalties); 33 U.S.C. §1319(c)(1) (negligent misdemeanor criminal penalties); id. §1321(b)(7)(D) (gross negligence civil penalties); id. §1319(c)(2) (knowing felony criminal penalties)). 42 Hilliary v. State, 1981 OK CR 78, 630 P.2d 791, 793. 43 Id. 44 State v. Patton, 1992 OK 57, 837 P.2d 483, 484. 45 See, e.g., State v. Price, 2012 OK 51, ¶ 23, 280 P.3d 943, 950 ("Our definition of willful neglect of duty has varied depending on the statutes in question. . . [and] we must look at a statute's underlying intent and purpose to define it.") (material and citation omitted). 46 State ex rel. Lydick v. Brown, 1973 OK 135, 516 P.2d 239, 241 (quoting Henry v. Oklahoma City, 1940 OK 472, 108 P.2d 148) ("There is also a well-established rule of law that public officials are presumed to do their duty."). 47 State v. Smith, 1914 OK 282, 142 P. 408, 410 (Court explained that election officials "as well as all other public officials, are presumed to know the law and to adhere to its mandates in the discharge of their public duties under their oaths of office"). 48 Citations to a transcript (Tr.) reference the transcript of the evidentiary hearing held on 02/11/2022, and which was used by the trial court for its findings and conclusions in its journal entry of judgment. 49 Questions asked the Director by plaintiffs' counsel at the hearing appear to indicate different opinions by the Director and counsel on the legal effect of Sample and whether a viable test method was available after Sample but prior to the Board creating new rules. This issue is not presented as part of the appellate controversy, and we need not address the hypothetical issue. Tulsa Cty. Budget Bd. v. Tulsa Cty. Excise Bd., 2003 OK 103, n.31, 81 P.3d 662, 672 ("This Court does not issue advisory opinions or answer hypothetical questions."). 50 Moran v. City of Del City, 2003 OK 57, ¶ 11, 77 P.3d 588, 592 (a person's duty to discover facts, a duty to know or should know, and to anticipate and guard against what might occur under the circumstances, occurs in negligence cases). 51 Id. 2003 OK 57, at n.4, 77 P.3d at 592. 52 Brewer v. Murray, 2012 OK CIV APP 109, ¶ 25, 292 P.3d 41, 52 (Approved for Publication by Supreme Court, 2012 OK 100, 290 P.3d 758) (applying Restatement (Second) of Torts § 289(b), and concluding parent was charged with superior knowledge, perception, intelligence and judgment regarding parent's daughter due to parent's prior experiences and relevant to using reasonable judgment for the purpose of exercising parental control over daughter). 53 Restatement (Second) of Torts § 289 (1965): The actor is required to recognize that his conduct involves a risk of causing an invasion of another's interest if a reasonable man would do so while exercising (a) such attention, perception of the circumstances, memory, knowledge of other pertinent matters, intelligence, and judgment as a reasonable man would have; and (b) such superior attention, perception, memory, knowledge, intelligence, and judgment as the actor himself has. 54 Moran v. City of Del City, supra note 50, at ¶ 11, 77 P.3d at 592 (quoting Prosser and Keeton on the Law of Torts, 182 (5th ed.1984) (discussing negligence of an actor)). 55 Foster v. Emery, 1972 OK 38, 495 P.2d 390, 392 (equating mere carelessness and inadvertence with negligence). 56 Altman v. Aronson, 231 Mass. 588, 591-592, 121 N.E. 505, 506 (1919) (defining negligence and gross negligence). 57 Farley v. City of Claremore, 2020 OK 30, ¶ 47, 465 P.3d 1213, 1237. 58 Altman v. Aronson, supra note 56. 59 Wells v. Oklahoma Roofing & Sheet Metal, L.L.C., 2019 OK 45, ¶ 8, 457 P.3d 1020, 1025. 60 An act of noncompliance with the OMA may require consideration of factors in addition to these five in order to determine if a willful violation of the OMA occurred. KUEHN, J., DISSENTING: ¶1 I agree that this case turns on whether the violation of the Open Meetings Act here was willful. However, the meaning of "willful" is not an issue in this case. "Willful" within the Open Meetings Act was thoroughly discussed and clearly defined in a published Court of Civil Appeals opinion in 1981. In the Matter of the Appeal of the Order Declaring Annexation Dated June 28, 1978, issued by Gene Frazier, 1981 OK CIV APP 57, ¶¶ 24-29, 637 P.2d 1270, 1274-75. This Court adopted this test in Rogers v. Excise Board of Greer County, 1984 OK 95, ¶ 14, 701 P.2d 754, 761, and reaffirmed it in Fraternal Order of Police v. City of Norman, 2021 OK 20, ¶ 18, 489 P.3d 20, 26, and it remains the applicable test. However, rather than apply it, the Majority unnecessarily redefines the term "willful", and the Court of Civil Appeals morphs the definition into something new altogether. Since a new definition is unnecessary, I dissent. ¶2 The Frazier test to determine whether violations of the Open Meetings Act are willful is whether an action or inaction of a mandate of the Act is done in a "conscious, purposeful" way or is a "blatant or deliberate disregard of the law by those who know, or should know, the requirements of the Open Meeting Act." Frazier, 1981 OK CIV APP 57, ¶ 29, 637 P.2d at 2175. What willfulness does not require under this Act is a showing of "bad faith, malice, or wantonness." Id. Interestingly, the Majority quotes this language in paragraph 34 of the Opinion, but apparently fails to recognize that it is the dispositive test. ¶3 In reviewing the trial court's decision, the Court of Civil Appeals recognized the willfulness test set forth in Rogers and Frazier, but did not apply it. Instead, the Court unnecessarily redefined it. The Court, mistakenly analyzing previous cases by their facts and not by legal theory, determined that a willful violation of the OMA requires an intent to violate the OMA, with a motive to violate the OMA, and further found that the intent can even be inferred by the actions of a party who violates the OMA. Id. The facts of each of the cases analyzed by the Court of Civil Appeals happened to fall under the "conscious, purposeful" category -- that is, the facts in those cases fell under the first prong of the Frazier test. When looking to only the facts of those cases, the Court then mistakenly assumed that intent was an element of willful. This is not correct. Under the second prong, a willful action might violate the Act if it was made in blatant or deliberate disregard of the law, by someone who should have known better. This clearly requires no intent. ¶4 The Majority, on certiorari review of the Court of Civil Appeals opinion, appears to reject that Court's addition of "intent" to the Frazier test. However, instead the Majority spends time toiling over what "willful" means in the OMA. In doing so, the Majority also unnecessarily reworks the willfulness test outlined in Frazier. ¶5 But neither of the reviewing courts' analyses on the meaning of willful is necessary here. The real problem to be solved began with the district court's written findings. The district court correctly held that he was to make a factual determination of whether a "willful" violation of the Open Meeting Act occurred under the "holdings of Frazier...." After that pronouncement, however, the trial court did not delineate the test announced in Frazier and did not apply the facts to that test. Without more specific findings, no appellate court can determine what the trial court decided in this case. Was the trial court considering that the Board representative, who knew or should have known the Act's requirements, violated the Act with blatant or deliberate disregard of the law? If so, what facts that the trial court lists in the findings helped him reach that result? Or was the trial court applying only a portion of the Frazier test? Or did it misunderstand the test completely? We do not know. ¶6 I would vacate the Court of Civil Appeals opinion and remand the case back to the trial level for the district judge to determine under Frazier what facts support a finding of a willful violation.

03729355-5239-4802-9c79-81a828d965b3

Ritter v. Oklahoma

oklahoma

Oklahoma Supreme Court

RITTER v. STATE2022 OK 73Case Number: 119840Decided: 09/20/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. DR. VALERIE RITTER, for herself as an Individual and for and on behalf of her Minor Children RR and ER; KIMBERLY BUTLER, for herself as an individual and For and on behalf of her Minor Child HB; DR. BRITNEY ELSE, for herself as an Individual and for and on behalf of her Minor Child BJ; and THE OKLAHOMA STATE MEDICAL ASSOCIATION, an Oklahoma Not For Profit Corporation, Plaintiffs/Appellees, v. THE STATE OF OKLAHOMA; AND THE HONORABLE KEVIN STITT In his official capacity as GOVERNOR OF OKLAHOMA, Defendants/Appellants. Appeal from the District Court of Oklahoma County Honorable Natalie Mai, Trial Judge ¶0 The plaintiffs/appellees, doctors, parents, and the Oklahoma State Medical Association, (collectively, doctors) brought a declaratory judgment action against the State of Oklahoma and the Governor in the District Court of Oklahoma County. They sought: 1) a declaration that Senate Bill 658, codified as 70 O.S. Supp. 2021 Ch. 15, §§1210-189 and 190, which restricts school districts of local control of public schools from making decisions about mask wearing to school in order to protect all students from contracting or spreading a highly contagious and infectious disease, only when the Governor declares a state of emergency is unconstitutional; and 2) an injunction enjoining the alleged unconstitutional legislation from being enforced. The trial court granted a temporary injunction, enjoining the State from enforcing portions of Senate Bill 658. The State of Oklahoma and the Governor appealed. We retained the cause and hold that 70 O.S. Supp. 2021 §§1210-189 and 190, are an unconstitutional, impermissible delegation of Legislative authority. However, because the objectionable provision is stricken, the remainder of the statutes may be upheld. APPEAL PREVIOUSLY RETAINED; ORDER OF THE DISTRICT COURT VACATED. Robert A. Nance, Chad C. Taylor, Oklahoma City, Oklahoma, Donald M. Bingham, Sharon K. Weaver, Tulsa, Oklahoma, for Plaintiffs/Appellees. Bryan Cleveland, Mithun Mansinghani, Office of the Attorney General, State of Oklahoma, Oklahoma City, Oklahoma, for Defendants/Appellants. Hilary H. Clifton, Oklahoma City, Oklahoma, Jesse L. Marks, Denver, Colorado, for American Academy of Pediatrics, and the Oklahoma Chapter of American Academy of Pediatrics, Amicus Curiae. Jeffrey B. Dubner, Jessica Anne Morton, Democracy Forward Foundation, Washington, D.C., for American Academy of Pediatrics, Amicus Curiae. Nick Southerland, Brian S. Wilerson, Tulsa, Oklahoma, for Oklahoma Disability Law Center, Amicus Curiae KAUGER, J.: ¶1 The determinative question presented is whether Senate Bill 658, codified as 70 O.S. Supp. 2021 Ch. 15, §§1210-189 and 190, is an unconstitutional restriction of the ability of public schools to exercise local control of the health and welfare of students.1 We hold that 70 O.S. Supp. 2021 Ch. 15, §1210-189 and 190 are an unconstitutional delegation of legislative authority in violation of art. 4, §1 of the Oklahoma Constitution only to the extent that they require the Governor to declare an emergency before local school districts may make decisions regarding local health matters.2 We strike the offending provision and the remainder of the statutes remain upheld.3 THE PARTIES, THE ALLEGED FACTS, AND THE PROCEDURAL HISTORY. ¶2 The plaintiff/appellee, Dr. Valerie Ritter, is a Doctor of Osteopathic Medicine, specializing in Pediatrics. She is also the parent of two children who are under the age of twelve, and who are enrolled in the Tulsa Public School system. One of her children has a history of bronchiectasis and hospitalizations for respirator distress and pneumonia. The plaintiff/appellee, Kimberly Butler, is the mother of four minor children also enrolled in the Tulsa Public School System. One of her children has epilepsy and Autism Spectrum Disorder. Ms. Butler, whose graduate degree is in public health, also works in the medical industry as a Senior Program Officer overseeing Maternal Child Health at the George Kaiser Family Foundation. She also serves on the Board of Directors for a Tulsa hospital and on the City of Tulsa's COVID-19 Testing Task Force. ¶3 The plaintiff/appellee, Mary Ann Martin is the parent of three minor children who are enrolled in the Norman Public School System. One of her children has serious health issues and a compromised immune system. The plaintiff/appellee, Dr. Britney Else is the parent of a minor child who is enrolled in the Broken Arrow Public School System. Dr. Else is a family-medicine and sports-medicine physician. The plaintiff/appellee, Oklahoma State Medical Association is a domestic not for profit corporation whose mission is "Better Health for Oklahoma." ¶4 On March 15, 2020, Oklahoma's Governor, J. Kevin Stitt, declared a statewide emergency due to the coronavirus pandemic and the impending threat of the spread of COVID-19 to the people of this State and their peace, health, and safety.4 As the pandemic spread, the Governor continued to issue several modifications to his state of emergency declaration, until, in an executive order issued May 3, 2021, and made effective May 4, 2021, the Governor rescinded his previous emergency declaration.5 Subsequently, the Oklahoma Legislature passed Senate Bill 658 in May of 2021, and the Governor signed it into law on May 28, 2021. ¶5 Senate Bill 658 concerns additions and amendments to school health and safety statutes 70 O.S. 2011 Ch. 15, §§1210.191-1210.194 which were enacted in 1970. The statutes concern school immunizations, exemptions from immunizations,6 and the control of contagious diseases and head lice.7 Prior to the 2021 additions/amendments, the statutes expressly listed immunization requirements for minor children to attend schools operating in the state. For example, 70 O.S. 2011 Ch. 15 §1210.191, provides in pertinent part: A. No minor child shall be admitted to any public, private, or parochial school operating in this state unless and until certification is presented to the appropriate school authorities from a licensed physician, or authorized representative of the State Department of Health, that such child has received or is in the process of receiving, immunizations against diphtheria, pertussis, tetanus, haemophilus influenzae type B (HIB), measles (rubeola), (rubella), poliomyelitis, varicella, and hepatitis A or is likely to be immune as a result of the disease.8 Title 70 O.S. 2011 Ch. 15 §1210.194 provides in pertinent part: A. Any child afflicted with a contagious disease or head lice may be prohibited from attending a public, private, or parochial school until such time as he is free from the contagious disease or head lice. . . . ¶6 However, Senate Bill 658 creates/adds two new sections, 70 O.S. Supp. 2021 §§1210-189 and 190, which work together.9 Section 1210-189 relates to vaccination restrictions and COVID-19 mask mandates. It provides: A. A board of education of a public school district or a technology center school district, the board of regents of an institution within The Oklahoma State System of Higher Education, the governing board of a private post secondary educational institution, the Oklahoma State Regents for Higher Education, the State Board of Education or the State Board of Career and Technology Education shall not: 1. Require a vaccination against Coronavirus disease 2019 (COVID-19) as a condition of admittance to or attendance of the school or institution; 2. Require a vaccine passport as a condition of admittance to or attendance of the school or institution; or 3. Implement a mask mandate for students who have not been vaccinated against COVID-19. B. As used in this section, "vaccine passport" means documentation that an individual has been vaccinated against COVID-19. C. Nothing in this section shall be construed to apply to any public or private healthcare setting. Section 1210-190 provides: A. A board of education of a public school district or a technology center school district may only implement a mandate to wear a mask or any other medical device as provided in this subsection. 1. A board of education of a public school district or a technology center school district may only implement a mandate to wear a mask or any other medical device after consultation with the local county health department or city-county health department within the jurisdiction of where the board is located and when the jurisdiction of where the board is located is under a current state of emergency declared by the Governor. 2. The mandate shall explicitly list the purposes for the mandate. 3. The mandate shall reference the specific masks or medical devices that would meet the requirements of the mandate. 4. Any mandate to implement wearing a mask or any other medical device shall be reconsidered at each regularly scheduled board meeting. (Emphasis supplied.) ¶7 On August 12, 2021, the plaintiffs/appellees, the two doctors (doctors) and the two additional parents on behalf of their minor children (parents), along with the Oklahoma State Medical Association (OSMA) (collectively, doctors) filed a lawsuit in the District Court of the Oklahoma County against the State of Oklahoma, acting through the Legislature and the Governor, (collectively, the State). The doctors sought to enjoin the State from enforcing 70 O.S. Supp. 2021 Ch. 15, §1210-189 and 190.10 ¶8 They argued that the new additions to the legislation were unenforceable because: 1. They were an unconstitutional violation of equal protection and due process guaranteed by Okla. Const. art. 2, §7,11 because they only applied to public school districts, and not private and parochial schools, even though the existing provisions applied to all schools within the State of Oklahoma; 2. They were a violation of the Okla. Const. art. 5, §46 which prohibits the enactment of special laws regulating the affairs of school districts;12 3. They were a violation of the Okla. Const. art. 5, §57 which requires every act of the Legislature to embrace only one section;13 and 4. They were a violation of Oklahoma childen's right to a free education in a safe environment guaranteed by the Okla. Const. art. 1, §5.14 The plaintiffs do not take issue with the minor modifications which were made to 70 O.S. 2021 Ch. 15, §1210-191.1 by Senate Bill 658.15 Consequently, we do not review this statute for constitutional validity.16 ¶9 On September 8, 2021, the trial court filed an order in which it granted, in part, the doctors' amended motion for a temporary injunction. The order states that: IT IS THEREFORE ORDERED, ADJUDGED, AND DECREED, that Plaintiffs' Amended Motion for Temporary Injunction is granted in part. The State of Oklahoma and Governor Kevin Stitt are enjoined from enforcing certain sections of SB658 enacted in 2021 against any board of education of a public school district that has exemptions as described herein, specifically 70 O.S. §1210.189(A)(3) prohibiting a mask mandate for unvaccinated K-12 students and 70 O.S. §1210.190 prohibiting a board of education of a public school district from implementing a mandate to wear a mask against K-12 public schools until further order of this Court. Any mask mandate or requirement for students in a K-12 public school must include the same exemptions that are present in 70 O.S. §§1210.192-1210.193." ¶10 The State appealed on September 9, 2021. The doctors filed a counter-appeal on September 20, 2021. According to the doctors' counter petition in error, the result of the trial court's order is that public school districts must honor the absolute immunization "veto" by parents as to masking, but private schools are not similarly bound by such a requirement. Both parties filed motions to retain the appeal in this Court. We granted the State's motion to retain the appeal on September 15, 2021, and the doctors' motion to retain on September 23, 2021. After the expedited briefing cycle was completed, the cause was assigned on December 28, 2021, for an opinion.17 TITLE 70 O.S. SUPP. §§1210-189 AND 190 ARE AN UNCONSTITUTIONAL DELEGATION OF LEGISLATIVE AUTHORITY WHICH VIOLATES THE OKLA. CONST. ART. 4 §1 ONLY TO THE EXTENT THAT THEY REQUIRE THE GOVERNOR TO DECLARE AN EMERGENCY BEFORE LOCAL SCHOOL DISTRICTS MAY MAKE DECISIONS REGARDING LOCAL HEALTH MATTERS. WE STRIKE THE OFFENDING PROVISIONS AND THE REMAINDER OF THE STATUTES REMAIN UPHELD. ¶11 The standard of review imposed for the issuance of a temporary injunction is whether the trial court abused its discretion or entered a decision against the evidence.18 Much of the State's arguments misdirect the attention away from the dispositive issue to larger, public policy and political issues which are not before us. Because we decide the matter on improper legislative delegation of authority, we need not address the other constitutional arguments of unconstitutional violation of equal protection and due process, the enactment of special laws regulating the affairs of school districts, violation of the single subject rule, or a child's right to a free education in a safe environment. ¶12 Title 70 O.S. Supp. 2021 §§189 and 190 do not prohibit public schools from requesting that students wear masks to school, nor do they prohibit students from wearing masks to school. Nor do they require vaccines for COVID or prohibit students from getting vaccinated. Rather, they prohibit a public school district from requiring a vaccination or proof of a vaccination before attending in-person school and from mandating masks for unvaccinated students, unless the district first consults with the local county health department or city-county health department within the jurisdiction of where the school board is located and then, only if the Governor declares a state of emergency in that same jurisdiction. If the Governor, as he has publicly indicated, will not declare a state of emergency due to COVID, then the statute acts as a state wide prohibition for masks for public schools.19 ¶13 The Oklahoma Governor has limited autonomous authority. The Court in Treat v. Stitt, 2020 OK 64, ¶¶4-5, 473 P.3d 43, explained the separation of powers as follows: . . . The legislative branch sets the public policy of the State by enacting law not in conflict with the Constitution. Okla. Const. art. V, § 1. The Governor has a role in setting that policy through his function in the legislative process, but the Governor's primary role is in the faithful execution of the law. Okla. Const. art. VI, §§ 8 & 11. ¶14 Section 8 provides: "The Governor shall cause the laws of the State to be faithfully executed, and shall conduct in person or in such manner as may be prescribed by law, all intercourse and business of the State with other states and with the United States, and he shall be a conservator of the peace throughout the State." As far as the Governor's general authority goes, it is recognized that the drafters of the Oklahoma Constitution placed provisions to protect the people of the State of Oklahoma against excessive political and economic power. ¶15 Oklahoma's historical underpinnings were economically conservative. Fearing excessive power in the hands of one individual, the framers of the Oklahoma Constitution intentionally created a weak state chief executive. The Governor's authority is limited by the Constitution, because the Chief Executive may exercise only the power specifically granted by the Legislature. The Governor is without authority to exercise a discretion not validly and specifically granted by the statutory law and not within the power conferred upon the Chief Executive by the Constitution.20 ¶16 On the other hand, the Legislature has plenary authority to establish the public policy of the State and the Legislature has wide latitude in what it can do with public schools. The Oklahoma Constitution Preamble expressly recognizes that it was established to promote the mutual welfare of citizens.21 The furtherance of the health and safety of citizens has long been recognized as a valid basis of police power.22 We have expressly acknowledged that it is the Legislature which sets the public policy of the State as long as it does not conflict with the Constitution.23 ¶17 The Legislature goes to great lengths and devotes great resources to curtail the spread of infectious diseases. The necessity of curtailing the spread of contagious diseases is also well-grounded and authorized by the Oklahoma Legislature through statutory authority.24 As we noted in Fair School Finance Council of Oklahoma, Inc. v. State, 1987 OK 14, ¶47, 746 P.2d 1135, "[t]here is simply no doubt that local participation and control are an objective of the Oklahoma scheme, because these are expressly mentioned in 70 O.S. 1981 §18-101." The school system is "designed to strengthen and encourage local responsibility for control of public education, with the maximum public autonomy and responsibility remaining at the local level." Fair, supra at ¶45. ¶18 Public health codes "in a clear and compelling fashion" articulate a well-defined, firmly established, state public policy.25 Oklahoma, along with every other state, already requires most of the CDC recommended immunizations for children and teens, without differentiating why a COVID vaccine might be treated differently than any others.26 ¶19 At the heart of the legislation in this matter is local control usurped or impeded by requiring the Governor to declare or not declare a state of emergency. The statutes remove the school board's authority to act independently and exercise the authority granted to the school board and it grants that authority to the Governor -- who has neither constitutional nor statutory authority over the operation of schools. ¶20 This is an impermissible delegation of authority. One branch of government may neither directly or indirectly control another branch -- nor subject it to coercive influence.27 While the Legislature may not delegate its authority to make policy, it may delegate rulemaking authority to implement its policies.28 Any rulemaking authority is subordinate to the statute itself, which must both establish policy and provide definite standards for the delegated exercise of rulemaking power.29 But such a delegation cannot confer the power to change the underlying law.30 ¶21 The statutes go far beyond a delegation of rulemaking authority. A school board is prohibited from deciding to implement any mask mandate, even after consulting local health department experts. Instead, that decision is controlled by a separate, independent action by the Governor. This allows the Governor to alter the implementation of the law without any legal authority to do so, even though the Governor does have the statutory authority, in limited circumstances, to issue executive orders declaring a state of emergency. ¶22 The question in this cause is whether the Governor's limited ability to declare an emergency can serve as the basis for a legitimate exercise of authority over public school decisionmaking. It cannot because the clause in the statutes does not merely grant the Governor the authority to declare an emergency, but instead, it requires the Governor to exercise legislative authority over school boards, and, as such, is impermissible. ¶23 In some circumstances an invalid portion of a statute may be stricken, while the remainder of the statute remains enforceable. This is the case when the valid provisions are separable, or are capable of being executed in accordance with the legislative intent of the statute as enacted.31 A local district's authority to protect its students under the statutes at issue is totally dependent on the governor declaring an emergency. Without such a delegation the school district is powerless and it is denied local control. Accordingly, striking the objectionable delegation to the Governor's declaration of an emergency further enhances the legislative intent of the statutes. Therefore, the remainder of the statutes remain upheld. CONCLUSION ¶24 The Okla. Const. art 4, §1 prohibits one branch of the government from exercising powers properly belonging to another branch.32 Local control of schools is usurped by requiring the Governor to exercise executive authority to declare a state of emergency. The statutes remove the school board's authority to act independently and exercise the authority granted to school boards and it grants that authority to the Governor -- who has neither constitutional nor statutory authority over the operation of schools. That responsibility cannot be abrogated through the Governor's independent action. Consequently, striking the clause found in the last sentence of Section 1210-190(A)(1) "and when the jurisdiction of where the board is located is under a current state of emergency declared by the Governor," removes the constitutional infirmity and enhances the school board's authority to act independently and exercise authority over local public health and welfare matters. APPEAL PREVIOUSLY RETAINED; ORDER OF THE DISTRICT COURT VACATED. DARBY, C.J., KAUGER, WINCHESTER, EDMONDSON, GURICH, ROWE, KUEHN, JJ., concur. FISCHER, S.J., with whom COMBS, J., joins: concurs in part, dissents in part. KANE, V.C.J., recused. FOOTNOTES 1 The State of Oklahoma argues that this lawsuit must fail because it is immune from "liability" unless the Legislature waives immunity from suit. The only law they rely on is Freeman v. State ex. rel. Dept. of Human Services, 2006 OK 71, ¶8, 145 P.3d 71 which is distinguishable on its facts and is inapplicable to this cause. Freeman involved the question of whether a state employee could sue a state agency for failure to pay overtime under the Fair Labor Standards Act, 29 U.S.C. §201 et. seq. The court held that the State of Oklahoma was immune from suit by a citizen of Oklahoma against it brought in state court because the State of Oklahoma had not consented to suit under the Act. In Fair School Finance Council of Oklahoma, Inc. v. State, 1987 OK 114, ¶3, 746 P.2d 1135, this Court reviewed a lawsuit for a declaration that Oklahoma's system of financing public elementary and secondary schools was constitutionally infirm. The State of Oklahoma, among others, was a named party in that lawsuit. Furthermore, a declaratory judgment may be sought to determine the validity of any statute. Osage Nation v. Board of Commissioners of Osage County, 2017 OK 34, ¶8, 394 P.3d 1224 (except in a few circumstances which are not applicable in this cause.) Osage, supra at ¶55, also notes that a suit for declaratory judgment is neither strictly legal nor equitable, but assumes the nature of the controversy at issue. Title 12 O.S. 2011 §1651 provides: District courts may, in cases of actual controversy, determine rights, status, or other legal relations, including but not limited to a determination of the construction or validity of any foreign judgment or decree, deed, contract, trust, or other instrument or agreement or of any statute, municipal ordinance, or other governmental regulation, whether or not other relief is or could be claimed, except that no declaration shall be made concerning liability or nonliability for damages on account of alleged tortious injuries to persons or to property either before or after judgment or for compensation alleged to be due under workers' compensation laws for injuries to persons. The determination may be made either before or after there has been a breach of any legal duty or obligation, and it may be either affirmative or negative in form and effect; provided however, that a court may refuse to make a determination where the judgment, if rendered, would not terminate the controversy, or some part thereof, giving rise to the proceeding. 2 The Oklahoma Constitution, art. 4, §1, provides: The powers of the government of the State of Oklahoma shall be divided into three separate departments: The Legislative, Executive, and Judicial; and except as provided in this Constitution, the Legislative, Executive, and Judicial departments of government shall be separate and distinct, and neither shall exercise the powers properly belonging to either of the others. 3 We note that at the time the statutes were enacted, the State was faced with an unconventional and novel health situation which culminated in the enactment of the challenged statutes. There are remaining constitutional arguments made by the doctors which we do not address in this cause. Because of the novelty of the situation and the striking of the offensive portion of the statutes, we are unable to discern or determine whether the parties remaining arguments would even remain. 4 The Governor's Executive Order 2020-07, filed with the Oklahoma Secretary of State on March 15, 2020, states in pertinent part: Therefore, I, J. Kevin Stitt, Governor of the State of Oklahoma, pursuant to the power vested in me by Section 2 of Article VI of the Oklahoma Constitution, hereby declare and order the following: 1. There is hereby declared an emergency caused by the impending threat of COVID-19 to the people of this State and the public's peace, health, and safety. The counties included in this declaration are: All 77 Oklahoma Counties 2. The State Emergency Operations Plan has been activated, and resources of all State departments and agencies available to meet this emergency are hereby committed to the reasonable extent necessary to prepare for and respond to COVID-19 and to protect the health and safety of the public. . . 5 The Governor's Executive Order 2021-11, filed with the Oklahoma Secretary of State on May 3, 2021 states in pertinent part: I, J. Kevin Stitt, Governor of the State of Oklahoma, pursuant to the power vested in my by Section 2 of Article VI of the Oklahoma Constitution hereby order: Effective May 4, 2021, Second Amended Executive Order 202-07 is withdrawn and rescinded.. . ." 6 For example, 70 O.S. 2011 Ch. 15, §1210.192 addresses immunizations and exemptions. It provides: Any minor child, through the parent, guardian, or legal custodian of the child, may submit to the health authority charged with the enforcement of the immunization laws of this state: 1. A certificate of a licensed physician as defined in Section 725.2 of Title 59 of the Oklahoma Statutes, stating that the physical condition of the child is such that immunization would endanger the life or health of the child; or 2. A written statement by the parent, guardian or legal custodian of the child objecting to immunization of the child; whereupon the child shall be exempt from the immunization laws of this state. Title 70 O.S. 2011 Ch. 15, §1210.193 provides: The immunizations will be administered by a licensed physician, someone under his direction, or public health department. If the parents or guardians are unable to pay, the State Department of Public Health shall provide, without charge, the immunization materials required by this act to such pupils. The parents, guardian or person having legal custody of any child may claim an exemption from the immunizations on medical, religious or personal grounds. 7 Title 70 O.S. 2011 Ch. 15, §1210-194 provides: A. Any child afflicted with a contagious disease or head lice may be prohibited from attending a public, private, or parochial school until such time as he is free from the contagious disease or head lice. B. Any child prohibited from attending school due to head lice shall present to the appropriate school authorities, before the child may reenter school, certification from a health professional as defined by Section 2601 of Title 63 of the Oklahoma Statutes or an authorized representative of the State Department of Health that the child is no longer afflicted with head lice. C. School districts and county or city-county health departments may enter into agreements under the Interlocal Cooperation Act for the purpose of providing assistance to the school district by inspecting children who are returning to school after an absence due to head lice to ensure that the child is no longer afflicted with head lice. D. If a school district and county or city-county health department has entered into an agreement as authorized in subsection C of this section, upon written authorization of the parent or guardian of a child, the county or city-county health department may provide treatment to the child for head lice. 8 Title 70 O.S. 2011 Ch. 15, §1210.191 provides in its entirety: A. No minor child shall be admitted to any public, private, or parochial school operating in this state unless and until certification is presented to the appropriate school authorities from a licensed physician, or authorized representative of the State Department of Health, that such child has received or is in the process of receiving, immunizations against diphtheria, pertussis, tetanus, haemophilus influenzae type B (HIB), measles (rubeola), (rubella), poliomyelitis, varicella, and hepatitis A or is likely to be immune as a result of the disease. B. Immunization tests required, and the manner and frequency of their administration, as prescribed by the State Board of Health, shall conform to recognized standard medical practices in the state. The State Department of Health shall supervise and secure the enforcement of the required immunization program. The State Department of Education and the governing boards of the school districts of this state shall render reasonable assistance to the State Department of Health in the enforcement of the provisions hereof. C. The State Board of Health, by rule, may alter the list of immunizations required after notice and hearing. Any change in the list of immunizations required shall be submitted to the next regular session of the Legislature and such change shall remain in force and effect unless and until a concurrent resolution of disapproval is passed. Hearings shall be conducted by the State Board of Health, or such officer, agents or employees as the Board may designate for that purpose. The State Board of Health shall give appropriate notice of the proposed change in the list of immunizations required and of the time and place for hearing. The change shall become effective on a date fixed by the State Board of Health. Any change in the list of immunizations required may be amended or repealed in the same manner as provided for its adoption. Proceedings pursuant to this subsection shall be governed by the Administrative Procedures Act. D. The State Department of Education and the governing boards of the school districts of this state shall provide for release to the Oklahoma Health Care Authority of the immunization records of school children covered under Title XIX or Title XXI of the federal Social Security Act who have not received the required immunizations at the appropriate time. The information received pursuant to such release shall be transmitted by the Oklahoma Health Care Authority to medical providers who provide services to such children pursuant to Title XIX or Title XXI to assist in their efforts to increase the rate of childhood immunizations pursuant to the requirements of the Early and Periodic Screening, Diagnosis and Treatment (EPSDT) services provisions. The provisions of this subsection shall not be construed to prohibit or affect the eligibility of any child to receive benefits pursuant to Title XIX or Title XXI of the Social Security Act or to require the immunization of any child if such child is exempt from immunization pursuant to Section 1210.192 of this title shall not be included in the information transmitted pursuant to this subsection. 9 Senate Bill 658 also amends a minor portion of existing 70 O.S. 2011 §1210-191. This portion of Senate Bill 658 is not challenged by the plaintiffs and we do not address it. The requirements were previously prescribed by the State Board of Health and enforced by the State Department of Health, but minor 2021 amendments to the statute replaced the State Board of Health and State Health Department with the Commissioner of Health. Title 70 O.S. 2011 Ch. 15, §1210-191 see note 7, supra; It also added a provision requiring the State Department of Education to provide notice of the requirements of immunizations for school attendance. The 2021 version provides in pertinent part: . . . B. Immunizations required, and the manner and frequency of their administration, as prescribed by the State Commissioner of Health, shall conform to recognized standard medical practices in the state. The State Department of Health shall supervise and secure the enforcement of the required immunization program. The State Department of Education and the governing boards of the school districts of this state shall render reasonable assistance to the State Department of Health in the enforcement of the provisions hereof. C. The Commissioner, by rule, may alter the list of immunizations required after notice and hearing. Any change in the list of immunizations required shall be submitted to the next regular session of the Legislature and such change shall remain in force and effect unless and until a concurrent resolution of disapproval is passed. Hearings shall be conducted by the Commissioner, or such officer, agents or employees as the Commissioner may designate for that purpose. The Commissioner shall give appropriate notice of the proposed change in the list of immunizations required and of the time and place for hearing. The change shall become effective on a date fixed by the Commissioner. Any change in the list of immunizations required may be amended or repealed in the same manner as provided for its adoption. Proceedings pursuant to this subsection shall be governed by the Administrative Procedures Act.. . . E. The State Department of Education shall provide and ensure that each school district in this state provides, on the school district website and in any notice or publication provided to parents regarding immunization requests, the following information regarding immunization requirements for school attendance: "For school enrollment, a parent or guardian shall provide one of the following: 1. Current, up-to-date immunization records; or 2. A completed and signed exemption form." 10 Title 70 O.S. Supp. 2021 §1210-189, see page 9, supra; and Title 70 O.S. Supp. 2021 §1210-190, see pages 9-10, supra. 11 The Okla. Const. art 2, §7 provides: No person shall be deprived of life, liberty, or property, without due process of law. In Hendricks v. Jones, 2013 OK 71, ¶8, 349 P.3d 531 we stated: ¶8 The Equal Protection Clause of the Fourteenth Amendment to the United States Constitution mandates no state "deny to any person within its jurisdiction the equal protection of the laws." The Oklahoma Constitution does not have an equivalent to the federal Equal Protection Clause; however, this Court has identified a functional equivalent in our due process section. Although not an absolute guarantee of equality of operation or application of state legislation, the Equal Protection Clause's purpose is to safeguard against arbitrary discrimination. (Footnotes omitted.) 12 The Okla. Const. art. 5, §46, provides in pertinent part: § 46. Local and special laws on certain subjects prohibited. The Legislature shall not, except as otherwise provided in this Constitution, pass any local or special law authorizing: The creation, extension, or impairing of liens; Regulating the affairs of counties, cities, towns, wards, or school districts; . . . 13 The Okla. Const. art 5, §57 provides: Every act of the Legislature shall embrace but one subject, which shall be clearly expressed in its title, except general appropriation bills, general revenue bills, and bills adopting a code, digest, or revision of statutes; and no law shall be revived, amended, or the provisions thereof extended or conferred, by reference to its title only; but so much thereof as is revived, amended, extended, or conferred shall be re-enacted and published at length: Provided, That if any subject be embraced in any act contrary to the provisions of this section, such act shall be void only as to so much of the law as may not be expressed in the title thereof. 14 The Okla. Const. art 1, §5 provides: Provisions shall be made for the establishment and maintenance of a system of public schools, which shall be open to all the children of the state and free from sectarian control; and said schools shall always be conducted in English: Provided, that nothing herein shall preclude the teaching of other languages in said public schools. 15 Title 70 O.S. 2021, Ch. 15, §1210-191.1, see page 7, supra. 16 In Fent v. Contingency Review Board, 2007 OK 27, ¶18, 163 P.3d 519, we explained severability analysis and the presumption of severability. Severability analysis is a necessary process when some, but not all, provisions of an enactment are to be condemned as unconstitutional and hence void. Its purpose is to determine whether non-offending statutory provisions may survive as valid after the clauses rejected as invalid are separated from the whole. The severability of a statutory enactment is not contingent on the presence of an express severability clause within the particular enactment's text. Survival of untainted statutory provisions that remain is appropriate when the valid and voided (as unconstitutional) provisions are not so "inseparably connected with and so dependent upon" each other that the surviving provisions would not have otherwise been enacted. Consideration must be given to whether the surviving provisions must rely on the severed portion for meaning or enforcement. Because the doctors do not take issue with the minor modifications which were made to 70 O.S. 2021 Ch. 15, §1210-191.1 and because they essentially are unrelated to the mask mandate provisions, they are, for purposes of this opinion, are severable from the rest of Senate Bill 658. 17 The plaintiffs argue that the legislation in question is unenforceable as unconstitutional for several reasons which did not include arguments regarding improper delegation of legislative authority. Nevertheless, when an appeal asserts a violation of a constitutional right, the appellate court will exercise its own independent judgment if it becomes necessary to determine the constitutional question. Ranola Oil Co. v. Corporation Commission of Oklahoma, 1988 OK 28, ¶7, 752 P.2d 1116. 18 Collier v. Reese, 2009 OK 86, ¶11, 223 P.3d 966; Brown ex rel. Brown v. Association, 2005 OK 88, ¶11, 125 P.3d 1219; Sharp v. 251ST St. Landfill, Inc., 1996 OK 109, ¶4, 925 P.2d 546; State ex rel. Schulte v. Hallco Environmental, Inc., 1994 OK 138, ¶2, 886 P.2d 994. Title 12 O.S. 2011 §952(b)(2) provides in pertinent part: b) The Supreme Court may reverse, vacate or modify any of the following orders of the district court, or a judge thereof: . . . 2. An order that discharges, vacates or modifies or refuses to vacate or modify a provisional remedy which affects the substantial rights of a party; or grants, refuses, vacates, modifies or refuses to vacate or modify an injunction; grants or refuses a new trial; or vacates or refuses to vacate a final judgment; . . . 19 For example, on July 23, 2021, Fox News reported that the Governor held a press conference to announce that he will not declare a new State of Emergency for an uptake in COVID infections: https://www.fox23.com/news/local/gov-stitt-will-not-declare-new-state-emergency-covid-cases-rise-oklahoma/RBTKZ2KBX5CINCYTWT44DWY2OQ/. On August 3, 2021, the reports noted that Governor's reasoning was because masks were medical devices and parents should have the freedom to make medical decisions regarding their children: https://www.fox23.com/news/local/oklahoma-groups-sends-petition-governor-asking-state-emergency/7HNVSMFL45DQVJ7TEWG5KAYBEQ/. Title 12 O.S. 2011 § 2202 provides: A. This section governs only judicial notice of adjudicative facts. B. A judicially noticed adjudicative fact shall not be subject to reasonable dispute in that it is either: 1. Generally known within the territorial jurisdiction of the trial court; or 2. Capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. C. A court may take judicial notice, whether requested or not. D. A court shall take judicial notice if requested by a party and supplied with the necessary information. E. In a civil action or proceeding, the court shall instruct the jury to accept as conclusive any fact judicially noticed. In a criminal case, the court shall instruct the jury that it may, but is not required to, accept as conclusive any fact judicially noticed. In Ind. School Dist. #52 of Okla. Const. v. Hofmeister, 2020 OK 56, ¶¶22-23, 473 P.3d 475 we stated: In federal court, judicial notice of fact may occur when the fact is not subject to reasonable dispute and it "can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." The Oklahoma statute has similar language. Some federal courts have stated a court may take judicial notice of an indisputably accurate fact on the world wide web (or internet), and public records and government documents available from reliable sources on the internet, such as websites run by governmental agencies may be used for the purpose of judicial notice. Some federal courts have also concluded public agency actions, factfinding, and decisions may be appropriate for judicial notice. . . . The motion to strike is denied, we take judicial notice of the audit, and use it as cited herein. 20 Oklahoma's Chief Executive differed substantially from the United States Chief Executive, the President. Wentz v. Thomas, 1932 OK 636, 15 P.2d 65 21 The Okla. Const. Preamble provides: Invoking the guidance of Almighty God, in order to secure and perpetuate the blessing of liberty; to secure just and rightful government; to promote our mutual welfare and happiness, we, the people of the State of Oklahoma, do ordain and establish this Constitution. 22 State ex rel. Dept. of Transp. v. Pile, 1979 OK 152, ¶14, 603 P.2d 337 [It cannot be denied that furtherance of health and safety of its citizens is a valid basis for the exercise of a state's police power.]; Police power of state operates to protect the health, safety and general welfare of the public. Mustang Run Wild Project, LLC. v. Osage County Board of Adjustment, 2016 OK 113, ¶21, 387 P.3d 333; Indian Territory Illuminating Oil Co. V. Larkings, 1934 OK 125, (Syllabus by the Court), 31 P.2d 608. 23 Treat v. Stitt, 2020 OK 64, ¶¶4-5, 473 P.3d 43. Okla. Const. art 5, §1 provides: The Legislative authority of the State shall be vested in a Legislature, consisting of a Senate and a House of Representatives; but the people reserve to themselves the power to propose laws and amendments to the Constitution and to enact or reject the same at the polls independent of the Legislature, and also reserve power at their own option to approve or reject at the polls any act of the Legislature. 24 For example, 63 O.S. 2011 §1-713 directs the State Commissioner of Health, to make sure hospitals, health centers, community mental health facilities, and related health facilities, and other nonprofit health facilities, carry out standards prescribed by the Surgeon General of the United States Public Health Service with the approval of the Federal Hospital Advisory Council. The State of Oklahoma, through the Oklahoma State Department of Health, helps combat patient care and the control of infectious diseases in hospitals. Title 310, §667-13-1, of the Department's Health Code sets standards in hospital for the control of infectious diseases by requiring each hospital to establish an infection control program to provide a sanitary environment and avoid sources and transmission of infections. Among the procedures are included, §667-13-4 which provides for a infection tracking, policies for isolation, and employee training. State statutes and health regulations include 63 O.S. 2011 §§1-1900.1 et seq (the Nursing Care Act; 63 O.S. 2011 §§ 1-819 et seq. (The Residential Care Act); Infection Control Regulations from the Department of Health, 310:675-7-17.1 as well as federal regulations 42 CFR Ch. V., Pt. 483, §483 (Infection Control) and §483.65, §483.75, and Oklahoma Regulations, 9 OK Reg 3163, 10 OK Reg 1639, 24 OK Reg. 2030, 25 OK Reg. 2382. Nurses may lose their license for neglecting to do their part in curtailing the spread of infectious disease. Nurses' licenses are tied to controlling infections. See, 59 O.S. 2011 §567.8. 25 The Legislature delegates rulemaking authority to facilitate administration of legislative policy and such delegation is intended to eliminate the necessity of establishing every administrative aspect of general public policy by legislation. Administrative agencies create rules which are binding similar to a statute and are only created within legislatively-granted authority and approval. Such rules are necessary in order to make a statutory scheme fully operative. Public health codes, in a clear and compelling fashion, also articulate a well-defined, firmly established, state public policy prohibiting a nurse from working while infected with the influenza. In Estes v. Conoco Phillips Co., 2008 OK 21, ¶10, 184 P.3d 518 we recognized that: 1) pursuant to the Administrative Procedures Act, 75 O.S. 2011 §§250-323, the Legislature may delegate rulemaking authority to agencies, boards, and commissions to facilitate the administration of legislative policy; and 2) Administrative rules are valid expressions of lawmaking powers having the force and effect of law. In a similar manner the Oklahoma Department of Health Regulations §310:675-7-17-1 were statutorily mandated to implement the Nursing Home Care Act, control infections, and provide a safe and sanitary environment. Health codes disseminated by the boards of health, as directed by the Legislature, are clear and compelling, articulated, well-defined, firmly established expressions of public policy. Moore v. Warr Acres Nursing Center, 2016 OK 28, 376 P.2d 894 and Silver v. CPC-Sherwood Manor, Inc. 2004 OK 1, 84 P.3d, 728. 26 Title 70 O.S. 2011 Ch. 15, §1210.191, see page 7, supra. Of the 16 immunizations the CDC recommends for children and teens, all 50 states (plus the District of Columbus) mandate diphtheria, tetanus, pertussis (whooping cough), polio, measles, rubella and chickenpox. Drew DeSilver, State Have Mandated Vaccinations Since Long Before COVID-19, Pew Research Enter, www.pewresearch.org/fact-tank/2021/10/8. In Zucht v. King, 260 U.S. 17443 S. Ct. 2467 L. Ed. 194 (1922), the United States Supreme Court stated that Jacobson, supra, "settled that it is within the police power of a state to provide for compulsory vaccination." 27 Okla. Const. art. 4 §1, see note 2, supra. Okla. Educ. Ass'n v. State, 2007 OK 30, §19, 158 P.3d 1058. 28 Oklahoma Coalition for Reproductive Justice v. Cline, 2016 OK 17, ¶12, 368 P.3d 1278. 29 Thomas v. Henry, 2011 OK 53, ¶19, 260 P.3d 1251; Tulsa County Deputy Sheriff's Fraternal Order of Police, Lodge Number 188 v. Board of County Commissioners of Tulsa County, 2000 OK 2, ¶9, 995 P.2d 1124. 30 Oklahoma Coalition for Reproductive Justice v. Cline, see note 27, supra. 31 Title 75 O.S. 2011 §11 a provides: In the construction of the statutes of this state, the following rules shall be observed: 1. For any act enacted on or after July 1, 1989, unless there is a provision in the act that the act or any portion thereof or the application of the act shall not be severable, the provisions of every act or application of the act shall be severable. If any provision or application of the act is found to be unconstitutional and void, the remaining provisions or applications of the act shall remain valid, unless the court finds: a. the valid provisions or application of the act are so essentially and inseparably connected with, and so dependent upon, the void provisions that the court cannot presume the Legislature would have enacted the remaining valid provisions without the void one; or b. the remaining valid provisions or applications of the act, standing alone, are incomplete and are incapable of being executed in accordance with the legislative intent. 2. For acts enacted prior to July 1, 1989, whether or not such acts were enacted with an express provision for severability, it is the intent of the Oklahoma Legislature that the act or any portion of the act or application of the act shall be severable unless: a. the construction of the provisions or application of the act would be inconsistent with the manifest intent of the Legislature; b. the court finds the valid provisions of the act are so essentially and inseparably connected with and so dependent upon the void provisions that the court cannot presume the Legislature would have enacted the remaining valid provisions without the void one; or c. the court finds the remaining valid provisions standing alone, are incomplete and are incapable of being executed in accordance with the legislative intent. 32 The Okla. Const. art 4, §1, see note 2, supra. FISCHER, S.J., with whom COMBS, J., joins, concurring in part; dissenting in part. ¶1 The Plaintiffs challenge the constitutionality of two statutes, 70 O.S. Supp. 2021 §§ 1210.189 and 1210.190. Section 1210.189 is titled "Restrictions on Requiring Vaccinations - Vaccine Passport - Mask Mandate," and prohibits the governing body of any public school from requiring a vaccination or proof of vaccination "against Coronavirus disease 2019 (COVID-19) as a condition of admittance to or attendance of the school or institution." The title of section1210.190 states: "Requirements for Mask or other Medical Device Mandate," and limits the ability of these same institutions to "implement a mandate to wear a mask or any other medical device." ¶2 With respect to section 1210.190, I concur with the Majority. That statute contains an impermissible delegation of Legislative power to the Governor. When the offending provision is stricken, the remainder of the statue is enforceable. ¶3 However, there is no similar delegation of Legislative authority in section 1210.189, nor does that statute mention the Governor. Section 1210.189 concerns the authority of the governing body of any public school to require a vaccination for one disease, Coronavirus disease 2019, as a condition of admittance to school. But the Legislature has already specified the nine vaccinations which are required for school admission in a separate statute, 70 O.S. Supp. 2021 § 1210.191. Section 1210.191 applies to all school students, "public, private, or parochial," and lists the only vaccinations that are required for admittance to school. Id. A vaccination against Coronavirus disease 2019 is not listed nor is it required to attend school in Oklahoma. ¶4 Further, only the State Commissioner of Health "may alter the list of immunizations required . . . ." 70 O.S.2011 § 1210.191(C). The governing body of a public school has no authority to require a vaccination against Coronavirus disease 2019 before a student can attend. See 70 O.S.2011 § 5-117(A)(21) (providing that school boards can only perform "those powers . . . not delegated by law to any other agency or official"). Section 1210.189 prohibits the governing body of any public school from doing something it never had the authority to do in the first place. ¶5 In my view, severing the impermissible delegation to the Governor of Legislative power in section 1210.190 does not save section 1210.189, because section 1210.189 is a special law regulating public schools prohibited by Article 5, § 46 of the Oklahoma Constitution: "The Legislature shall not, except as otherwise provided in this Constitution, pass any local or special law . . . Regulating the management of public schools. . . ." Section 1210.191 specifies all of the vaccines required for all students attending every school in Oklahoma. In contrast, section 1210.189 addresses only one vaccine, the Coronavirus disease 2019 vaccine, and one group of students, those who attend a public school. "A statute is a special law when part of an entire class of similarly affected persons is segregated and targeted for different treatment." Beason v. I. E. Miller Services, Inc., 2019 OK 28, ¶9, 441 P.3d 1107. When a general law like 70 O.S. Supp. 2021 § 1210.191 "can be made applicable, no special law shall be enacted." Okla. Const. art. 5, § 59. ¶6 In addition, section 1210.189 conflicts with section 1210.190, the statute which the Majority holds is constitutional. For example, pursuant to 70 O.S.2011 § 1210.194, a local school board may prevent any student "afflicted with a contagious disease [like Coronavirus disease 2019] . . . from attending a public, private, or parochial school until such time as [the student] is free from the contagious disease." If, however, the board consults with the local health department pursuant to section 1210.190 and is advised that students infected with the Coronavirus disease 2019 may safely attend school under certain circumstances, one of which is if the infected student wears a mask for some period of time, section 1210.190 authorizes that school board to adopt a mask mandate permitting students to attend, even though they are infected with the Coronavirus disease 2019, if they wear a mask. ¶7 Nonetheless, section 1210.189(A)(3) would prohibit the school board from implementing such "a mask mandate for students who have not been vaccinated against COVID-19." Infected but unvaccinated students would either be prohibited from attending school pursuant to the board's authority in section 1201.194, or allowed to attend without wearing a mask. As a result, infected and vaccinated students who follow the board's mask mandate would be permitted to attend school while infected but unvaccinated students would be "segregated and targeted for different treatment." Beason v. I. E. Miller Services, Inc., 2019 OK 28, ¶9. ¶8 I my view section 1210.189 violates Article 5, § 46 of the Oklahoma Constitution. I respectfully dissent from that portion of the Majority Opinion holding that section 1210.89 is constitutional.

08640812-750c-4a60-81e2-f6494e8685c5

Snow v. Town of Calumet

oklahoma

Oklahoma Supreme Court

SNOW v. TOWN OF CALUMET2022 OK 63Case Number: 119748Decided: 06/21/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. STEVE SNOW and KACI SNOW, Plaintiffs/Appellants,v.TOWN OF CALUMET OKLAHOMA, Defendant/Appellee, ON APPEAL FROM THE DISTRICT COURT OF CANADIAN COUNTY Honorable Paul Hesse, Trial Judge ¶0 Landowners sued the Town of Calumet for trespass and inverse condemnation due to maintaining two municipal sewer lines across the owners' property after the expiration of two temporary easements. The town counterclaimed to quiet title. Both parties moved for summary judgment. The district court granted the landowners' motion for summary judgment on the town's quiet-title claim and granted the town's motion for summary judgment on the landowners' claims for trespass and inverse condemnation. The landowners appealed the district court's judgment on their inverse condemnation claim. This Court retained the appeal. We reverse the district court's judgment, holding the landowners have standing to assert an inverse condemnation claim, and we remand for trial. DISTRICT COURT'S JUDGMENT REVERSED AND REMANDED FOR TRIAL ON INVERSE CONDEMNATION CLAIM. Sean C. Wagner, Wagner Hicks, PLLC, Charlotte, North Carolina, for Plaintiffs/Appellants. Joseph P. Weaver and Jana L. Knott, Bass Law, El Reno, Oklahoma, for Defendant/Appellee. Winchester, J. ¶1 The limited issue before this Court is whether Appellants Steve Snow and Kaci Snow (the Snows) have standing to assert a claim for inverse condemnation against the Town of Calumet (Town), Oklahoma. We answer this question in the affirmative. Town's temporary easements for sewer lines installed by Town on the Snows' property expired in 2010, and Town then sought perpetual easements without compensation from the Snows for the continual use and maintenance of the sewer lines. Under these facts, the Snows have standing to assert a claim for inverse condemnation. FACTS AND PROCEDURAL HISTORY ¶2 In June 2010, the Snows purchased real property located in Town. The former owners of the real property had granted temporary easements to Town in 1978 to install and maintain two municipal sewer lines located on the Snows' property. The temporary easements expired in December 2010. ¶3 In May 2018, over seven years after the easements expired, Town requested that the Snows execute perpetual easements for Town's continued use and maintenance of the sewer lines. The Snows sought compensation from Town for the easements, but Town declined to compensate the Snows. ¶4 The Snows filed this action against Town for trespass and inverse condemnation. Town filed a counterclaim seeking to quiet title to the easements by prescription. Both parties filed motions for summary judgment. The district court granted in part the Snows' motion for summary judgment on Town's quiet title claim, holding the municipal sewer lines were permissive until the temporary easements expired in 2010 and Town had not satisfied the statutory period of fifteen years for prescriptive easements. The district court also granted Town's motion for summary judgment on the Snows' claims for trespass and inverse condemnation. The district court held that Town was entitled to judgment as a matter of law on the Snows' trespass claim because the former owners of the property consented to Town entering the property and installing the sewer lines. As to the Snows' inverse condemnation claim, the district court held that the Snows lacked standing to assert an inverse condemnation claim because the right to this claim belonged to the former owners of the property when Town installed the sewer lines in 1978. The Snows appealed the district court's judgment regarding their inverse condemnation claim. We retained the appeal. STANDARD OF REVIEW ¶5 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the trial court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. The Court has plenary, independent, and non-deferential authority to determine whether the trial tribunal erred in its legal rulings. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. All inferences and conclusions are to be drawn from the underlying facts contained in the record and are to be considered in the light most favorable to the party opposing summary judgment. U.S. Bank, 2012 OK 43, ¶ 13, 280 P.3d at 939. If reasonable individuals could reach different factual conclusions under the evidentiary materials, summary judgment is improper. Id. DISCUSSION ¶6 The Oklahoma Constitution guarantees that private property will not be taken or damaged for public use without just compensation. Okla. Const. art. 2, § 24. When a governmental entity takes or damages private property without just compensation, a person may bring an inverse condemnation claim. State ex rel. Dep't of Transp. v. Post, 2005 OK 69, ¶ 7, 125 P.3d 1183, 1186. The essential elements of an inverse condemnation claim are (1) a taking of property for public use by a governmental entity that has the power of eminent domain, and (2) a failure to tender just compensation. Drabek v. City of Norman, 1996 OK 126, ¶ 4, 946 P.2d 658, 659. We construe our State constitutional eminent domain provisions "strictly in favor of the owner and against the condemning party." Bd. of Cty. Comm'rs of Muskogee Cty. v. Lowery, 2006 OK 31, ¶ 11, 136 P.3d 639, 646. ¶7 The general rule is that the right of inverse condemnation belongs to the owner at the time of the taking. Cox Enters., Ltd. v. Phillips Petroleum Co., 1976 OK 75, ¶ 9, 550 P.2d 1324, 1326. The two exceptions that the Court has recognized are when (1) the current property owner had no knowledge that the taking occurred, and (2) the former property owner did not consent to the taking and transferred the right to recover just compensation for the taking to the current property owner. Drabek, 1996 OK 126, ¶ 17, 946 P.2d at 662. ¶8 Town argues that the Snows have no standing to allege inverse condemnation because they did not own the property at the time Town installed the sewer lines and no exception to this rule applies here. However, the Snows' right to bring an inverse condemnation claim here is distinguishable from the cases this Court decided where the owners of the properties attempted to recover for a taking that occurred when the former owners owned the properties. See, e.g., Drabek, 1996 OK 126, ¶ 17, 946 P.2d at 662; Cox Enters., Ltd., 1976 OK 75, ¶ 12, 550 P.2d at 1326-27; Consol. Gas Serv. Co. v. Tyler, 1936 OK 768, ¶ 40, 63 P.2d 88, 91. The Snows' inverse condemnation claim did not accrue until after the temporary easements granted by the former property owners expired. ¶9 Town's temporary easements granted by the former property owners when Town installed the sewer lines were limited to the particular purpose for which they were created. Story v. Hefner, 1975 OK 115, ¶ 13, 540 P.2d 562, 566. (holding easements are grants of limited land use subject to certain established rules of law). Town's right to utilize the land ended when the temporary easements expired in 2010, which is demonstrated by Town's own actions in seeking perpetual easements from the Snows in May 2018. When Town sought perpetual easements from the Snows for the continued use and maintenance of the sewer lines more than seven years after the temporary easements expired, the Snows owned the property, giving them standing to allege an inverse condemnation claim. ¶10 The fact that Town previously installed the sewer lines in 1978 and requested temporary easements from the former property owners is not determinative of whether the Snows currently have a claim for inverse condemnation. More than one taking can occur involving a single piece of property. See, e.g., Natural Gas Pipeline Co. of Am. LLC v. Foster OK Res. LP, 2020 OK 29, ¶ 20, 465 P.3d 1206, 1212 (allowing a condemnation claim for additional easements to operate and maintain two interstate natural gas pipelines after the initial taking of private property). Actual physical possession is not a condition in determining whether a taking took place. Post, 2005 OK 69, ¶ 11, 125 P.3d at 1187. A taking can occur when a governmental entity with the right to eminent domain overtly exercises dominion and control over private property, including when a governmental entity seeks an easement for the use of private property. Mattoon v. City of Norman, 1980 OK 137, ¶ 12, 617 P.2d 1347, 1349; Graham v. City of Duncan, 1960 OK 149, ¶ 18, 354 P.2d 458, 461. ¶11 The Court has also held that just compensation for a taking is determined as of the time a taking occurs. Okla. Turnpike Auth. v. Burk, 1966 OK 113, ¶ 13, 415 P.2d 1001, 1005. Town now seeks perpetual easements, which will restrict the Snows' property for an unlimited duration of time.1 The just compensation for a grant of a perpetual easement may be considerably different from the compensation for a grant of a temporary easement. The Snows therefore have a right to claim inverse condemnation for Town's permanent use of their property that exceeds the use Town previously had under its temporary easements. Whether Town's request for perpetual easements for the continued use and maintenance of the sewer lines located on the Snows' property constitutes a taking without just compensation is a question that must still be decided. ¶12 The Snows contend on appeal that they are entitled to summary judgment on the question of whether a taking has occurred, with the issue of just compensation being reserved for a determination by a jury at the trial on this matter. In an action for inverse condemnation, the issue of taking is critical and is a fact question that, unless confessed, must be tried to a jury. Carter v. City of Okla. City, 1993 OK 134, ¶¶ 14-15, 862 P.2d 77, 81.2 If a taking occurred, a jury then determines just compensation for the landowner. Id. The burden of proving a taking occurred is on the property owner. Inc. Town of Pittsburg v. Cochrane, 1948 OK 121, ¶ 0, 197 P.2d 287, 288 (Syllabus of the Court) (upholding rule in an inverse condemnation action that a plaintiff bears the burden of proof on all issues "that lie at the foundation of the . . . proceedings"). If a taking occurred by Town in seeking perpetual easements for the continued use and maintenance of the municipal sewer lines, a jury must also determine just compensation for the Snows. This case is therefore remanded for a trial on the issues of whether a taking occurred and just compensation for the taking. CONCLUSION ¶13 The Snows have standing to assert an inverse condemnation claim. Town's right to utilize the land ended when the temporary easements expired in 2010. Town sought perpetual easements from the Snows for the continual use and maintenance of the sewer lines. The Snows requested just compensation for the Town to continue to utilize the land, but Town refused to compensate the Snows. Accordingly, we hold that the district court erred in granting summary judgment to Town, holding that the Snows did not have standing to assert an inverse condemnation claim. We remand the cause for further proceedings. DISTRICT COURT'S JUDGMENT REVERSED AND REMANDED FOR TRIAL ON INVERSE CONDEMNATION CLAIM. ALL JUSTICES CONCUR. FOOTNOTES 1 Perpetual Easement, Black's Law Dictionary (11th ed. 2019), available at Westlaw. 2 We reach this conclusion based on the long line of decisions holding that the taking issue in an inverse condemnation case is a question for the jury. See, e.g., Post, 2005 OK 69, ¶ 7, 125 P.3d at 1186; Oxley v. City of Tulsa, By and Through Tulsa Airport Auth., 1989 OK 166, ¶ 15, 794 P.2d 742, 745 (issue of de facto taking in inverse condemnation case "is a jury question"); Mattoon, 1980 OK 137, ¶ 10, 617 P.2d at 1349 (petition alleging compensable taking not demurrable); Henthorn v. Okla. City, 1969 OK 76, ¶¶ 14--15, 453 P.2d 1013, 1016 (trial court did not err in submitting the question of taking to the jury in inverse condemnation case); Atchison, T. & S. F. Ry. Co. v. Terminal Oil Mill Co., 1937 OK 349, ¶ 6, 71 P.2d 617, 619; Foster Lumber Co. v. Ark. Valley & W. Ry. Co., 1908 OK 265, ¶ 7, 95 P. 224, 228.

eea44512-1ce1-4994-9232-a618111c41f6

Patel v. Tulsa Pain Consultants

oklahoma

Oklahoma Supreme Court

PATEL v. TULSA PAIN CONSULTANTS2022 OK 56Case Number: 116827; Comp. w/118855Decided: 06/14/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JAYEN PATEL, M.D., Plaintiff/Appellant, v. TULSA PAIN CONSULTANTS, INC., P.C.; MARTIN MARTUCCI, M.D.; ANDREW REVELIS, M.D.; ROBERT SAENZ; ALANA CAMPBELL; LAM NGUYEN, M.D.; PAT McFADDEN; and EBONDIE TITWORTH, Defendants/Appellees. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION I ¶0 Plaintiff/Appellant Jayen Patel, M.D. brought a tort claim for wrongful termination against Defendant/Appellee Tulsa Pain Consultants, Inc. (TPC). The trial court found Patel was not an at-will employee and entered a directed verdict in favor of TPC. Patel appealed, and Division I of the Court of Civil Appeals affirmed. TPC filed a motion for appeal-related attorney fees, which the Court of Civil Appeals denied. We granted certiorari to determine whether TPC has a contractual right to recover attorney fees as the prevailing party in Patel's wrongful termination claim. We hold that the specific language in the parties' employment agreement authorizes attorney fees in this case. CERTIORARI PREVIOUSLY GRANTED; ORDER OF THE COURT OF CIVIL APPEALS IS VACATED; MOTION FOR APPEAL-RELATED ATTORNEY FEES IS GRANTED; REMANDED TO THE TRIAL COURT. R. Thompson Cooper, Roberson, Kolker, Cooper & Goeres, P.C., Edmond, Oklahoma, and Nick Larby, Larby & Associates, Tulsa, Oklahoma, for Appellant. Amelia A. Fogleman, GableGotwals, Tulsa, Oklahoma, for Appellees. KANE, V.C.J.: ¶1 We granted Defendant/Appellee Tulsa Pain Consultants, Inc.'s (TPC) petition for certiorari to determine whether TPC has a contractual right to appeal-related attorney fees as the prevailing party. Plaintiff/Appellant Jayen Patel, M.D. brought a tort claim for wrongful termination against TPC. TPC argued that Patel could not prevail on a Burk tort claim because, according to the terms of their employment contract, Patel was not an at-will employee. The trial court agreed and entered a directed verdict in favor of TPC. The Court of Civil Appeals affirmed the directed verdict but denied TPC's motion for appeal-related attorney fees. We hold that, pursuant to the specific terms of the parties' employment agreement, TPC is entitled to appeal-related attorney fees. FACTS AND PROCEDURAL HISTORY ¶2 Patel was an employee and shareholder of TPC. TPC terminated Patel's employment in May 2010, and Patel filed suit against TPC and its shareholders in November 2010. After years of litigation and multiple appeals, the case went to jury trial on a single claim of wrongful termination. TPC moved for a directed verdict arguing that, pursuant to the terms of the Variable Compensation and Employment Agreement ("Employment Agreement") and the Shareholders Agreement, Patel was not an at-will employee. The trial court concluded that, "as a matter of law, [Patel] was not an at-will employee and, therefore, not within the class of persons who may bring a claim in tort for wrongful discharge based on the policy exception to the employment at-will rule within the meaning of Burk v. K-Mart Corp., 1989 OK 22, 481 P.2d 24 [sic]" and entered a directed verdict in favor of TPC. ¶3 Patel appealed both the directed verdict and the trial court's denial of his motion to amend to re-add claims he had previously dismissed. On January 10, 2020, Division I of the Court of Civil Appeals affirmed both decisions. The Court of Civil Appeals held that the trial court did not abuse its discretion by denying Patel's motion to amend and that, because TPC incurred liability for Patel's termination under the terms of the Employment Agreement, Patel was not an at-will employee for purposes of a Burk tort. ¶4 Relying on the attorney fees provision in the Employment Agreement, TPC filed a motion for appeal-related attorney fees. The attorney fees provision in the Employment Agreement provided: "If the services of an attorney are required by a party to secure the performance or interpretation of this agreement, the prevailing party will be entitled to reasonable attorney fees, costs and other expenses." TPC argued that Patel's wrongful termination claim required the interpretation of the Employment Agreement to determine whether Patel was an at-will employee.1 Patel objected to an award of attorney fees on two grounds. First, Patel argued TPC was not entitled to attorney fees because the appeal arose out of a failed tort claim and not an action for breach of the Employment Agreement. Second, Patel asserted that the trial court looked to the existence of the Employment Agreement in determining that he was not an at-will employee but did not interpret the contract language. ¶5 On March 12, 2020, the Court of Civil Appeals denied TPC's motion for appeal-related attorney fees. Division I's Order did not cite any authority or provide any reasoning for the denial. This Court granted TPC's petition for certiorari to determine if the Employment Agreement authorizes appeal-related attorney fees.2 STANDARD OF REVIEW ¶6 A party may seek appeal-related attorney fees if there is statutory and/or decisional authority allowing fees. See 12 O.S.Supp.2019 § 696.4(C); Okla.Sup.Ct.R. 1.14(B), 12 O.S.Supp.2019, ch. 15, app. 1. Oklahoma follows the American Rule as to the recovery of attorney fees. Generally, each litigant pays for their own legal representation, and our courts are without authority to assess attorney fees in the absence of a specific statute or contract allowing for their recovery. See State ex rel. Tal v. City of Oklahoma City, 2002 OK 97, ¶ 16, 61 P.3d 234, 243; see also GRP of Texas, Inc. v. Eateries, Inc., 2001 OK 53, ¶ 15, 27 P.3d 95, 100 (recognizing that appeal-related attorney fees may be authorized by contract). TPC contends the Employment Agreement allows for the recovery of appellate attorney fees. When, as here, the trial court finds the terms of a contract are unambiguous and interprets the contract as a matter of law, a legal question is presented on appeal. See Johnson v. CSAA Gen. Ins. Co., 2020 OK 110, ¶ 9, 478 P.3d 422, 426. The appellate court reviews questions of law de novo. Id. Therefore, whether TPC has a contractual right to an award of appeal-related attorney fees presents a question of law subject to de novo review. ANALYSIS ¶7 Numerous times this Court has reiterated that "parties may agree by contract to pay for litigation expenses." Whitehorse v. Johnson, 2007 OK 11, ¶ 17, 156 P.3d 41, 48. This is, however, the Court's first occasion to opine as to whether parties may agree by contract to pay for litigation expenses related to a tort claim. We hold they may, but only if the contract language is carefully crafted to provide for such an award. ¶8 The attorney fees provision in the Employment Agreement provides: "If the services of an attorney are required by a party to secure the performance or interpretation of this agreement, the prevailing party will be entitled to reasonable attorney fees, costs and other expenses." TPC argues the language "or interpretation" authorizes attorney fees in this wrongful termination case, because the courts interpreted the Employment Agreement to determine if Patel was an at-will employee. Patel counters that the underlying claim is a tort claim and attorney fees are available only in cases arising out of breach of the Employment Agreement. ¶9 The attorney fees provision in the Employment Agreement is interpreted like any other contract: If the terms of a contract are unambiguous, clear and consistent, they are accepted in their plain and ordinary sense and the contract will be enforced to carry out the intention of the parties as it existed at the time it was negotiated. The interpretation of a contract, and whether it is ambiguous is a matter of law for the Court to resolve. Contractual intent is determined from the entire agreement. If a contract is complete in itself and viewed in its entirety is unambiguous, its language is the only legitimate evidence of what the parties intended. The Court will not create an ambiguity by using a forced or strained construction, by taking a provision out of context, or by narrowly focusing on the provision. Whitehorse, 2007 OK 11, ¶ 14, 156 P.3d at 47 (footnotes omitted). Additionally, "[a] contract is to be construed as a whole, giving effect to each of its parts, and not construed so as to make a provision meaningless, superfluous or of no effect." McGinnity v. Kirk, 2015 OK 73, ¶ 37, 362 P.3d 186, 199 (footnote omitted). ¶10 We find the contract language is clear and unambiguous and is to be interpreted as a matter of law. Patel's reading of the attorney fees provision is too narrow and would make the words "or interpretation" superfluous. "Performance," as used in "to secure the performance or interpretation of this agreement," speaks to an action for breach of contract or one to enforce the contract. However, the language "or interpretation of this agreement" clearly and unambiguously demonstrates the parties' intent to not limit fees to breach of contract claims. We interpret the Employment Agreement to mean that the parties agreed to prevailing party attorney fees not only where the services of an attorney are required to secure the performance of the contract, but also when they are required to secure the interpretation of the contract. The specific language in the Employment Agreement authorizes prevailing party attorney fees whenever the court is called upon to interpret the contract--even if that occurs in a tort action. ¶11 Our inquiry now turns to whether the trial court and the Court of Civil Appeals interpreted the Employment Agreement. It is helpful to review what is required to maintain an action for wrongful termination. The general rule is that an employment contract of indefinite duration is terminable at-will, which means that either the employer or the employee may terminate the employment relationship at any time for any reason or no reason at all without incurring liability for doing so. See McCrady v. Okla. Dep't of Pub. Safety, 2005 OK 67, ¶ 6, 122 P.3d 473, 474-75; Burk v. K-Mart Corp., 1989 OK 22, ¶ 5, 770 P.2d 24, 26. This Court adopted the public policy exception to the at-will termination rule and recognized a new tort cause of action for wrongful termination in Burk v. K-Mart Corp., 1989 OK 22, ¶ 17, 770 P.2d 24, 28. The elements of wrongful termination, i.e. a "Burk tort" are: (1) an actual or constructive discharge (2) of an at-will employee (3) in significant part for a reason that violates an Oklahoma public policy goal (4) that is found in Oklahoma's constitutional, statutory, or decisional law or in a federal constitutional provision that prescribes a norm of conduct for Oklahoma and (5) no statutory remedy exists that is adequate to protect the Oklahoma policy goal. Vasek v. Bd. of Cty. Comm'rs of Noble Cty., 2008 OK 35, ¶ 14, 186 P.3d 928, 932. The law is clear that if the employee is not an at-will employee, he is not within the class of persons who may bring a claim in tort for wrongful discharge based on the public policy exception to the at-will termination rule. See McCrady, 2005 OK 67, ¶ 13, 122 P.3d at 476. ¶12 While Patel's wrongful termination claim, by itself, did not implicate the interpretation of the Employment Agreement, TPC's defense and motion for directed verdict did. TPC argued that Patel could not bring a Burk tort claim for wrongful termination because he was not an at-will employee. TPC contended that it incurred financial obligations under the Employment Agreement for terminating Patel, which meant the employment relationship was not terminable at-will. The trial court had to interpret the Employment Agreement in order to rule on TPC's motion for directed verdict, and the Court of Civil Appeals had to interpret the Employment Agreement to review the correctness of the directed verdict. ¶13 We are not persuaded by Patel's argument that the trial court did not interpret the Employment Agreement but merely relied on the existence of the Employment Agreement and other written contracts between the parties in determining he was not an at-will employee. Patel asserts: It is readily apparent that [TPC] did nothing more than point to the fact (not the "interpretation") that both of the written contracts between the parties had financial obligations running in favor of [Patel] in the event of termination of employment to support their argument that [Patel] was not an at-will employee. Indeed, it was [TPC] themselves who kept trumpeting that the contracts were "clear" that financial obligations, or "liabilities," would be imposed on [TPC] in the event [Patel] was terminated. It runs afoul of basic logic that language which is supposedly clear needs to be "interpreted." Answer to Pet. for Cert. at 10. Patel's contentions are not supported by the record nor are they supported by the law. The parties clearly disagreed about the meaning and effect of the terms of the Employment Agreement and advocated for different interpretations. In support of TPC's argument that Patel was not an at-will employee, TPC pointed to, inter alia, a provision in the Employment Agreement that permitted termination without cause with 30 days notice but required TPC to pay Patel's salary during the 30-day notice period. Patel's position was that he was not entitled to any post-employment compensation and, as a result, his employment was at-will. The trial court and the Court of Civil Appeals were called upon to resolve whether Patel was an at-will employee. In order to do that, the lower courts interpreted the terms of the Employment Agreement to ascertain whether TPC incurred liability for terminating Patel. ¶14 Patel's suggestion that a court does not "interpret" a contract if the terms are clear and unambiguous is misguided. "If language of a contract is clear and free of ambiguity the court is to interpret it as a matter of law . . . ." Pitco Prod. Co. v. Chaparral Energy, Inc., 2003 OK 5, ¶ 12, 63 P.3d 541, 545 (emphasis added); see Whitehorse, 2007 OK 11, ¶ 14, 156 P.3d at 47 ("The interpretation of a contract, and whether it is ambiguous is a matter of law for the Court to resolve."). Even when the court is limited to examining the four corners of the document and does not receive extrinsic evidence, it engages in the interpretation of the clear and unambiguous language. The words are given their plain and ordinary meaning. See Whitehorse, 2007 OK 11, ¶ 14, 156 P.3d at 47. In this case, the trial court interpreted the clear and unambiguous terms of the Employment Agreement to mean that TPC incurred liability when Patel was terminated and, therefore, Patel was not an at-will employee. Patel then unsuccessfully argued to the Court of Civil Appeals that the trial court erred as a matter of law when it interpreted the Employment Agreement to mean he was not an at-will employee. The Court of Civil Appeals interpreted the Employment Agreement and affirmed the directed verdict. ¶15 The services of an attorney were required to secure the interpretation of the Employment Agreement. The directed verdict was based on the court's interpretation of the Employment Agreement. We hold that the attorney fees provision in the Employment Agreement authorizes prevailing party attorney fees in this case. Therefore, as the prevailing party, TPC has a contractual right to recover appeal-related attorney fees. CONCLUSION ¶16 The Employment Agreement provides for prevailing party attorney fees "[i]f the services of an attorney are required by a party to secure the performance or interpretation of this agreement." The lower courts' interpretations of the Employment Agreement were necessary to determine if Patel was an at-will employee for the purpose of maintaining a wrongful termination claim. The trial court interpreted the Employment Agreement to mean that Patel was not an at-will employee and, therefore, TPC was entitled to judgment as a matter of law. The Court of Civil Appeals affirmed the directed verdict. As the prevailing party, TPC has a contractual right to recover appeal-related attorney fees. ¶17 The Court of Civil Appeals's March 12, 2020 Order Denying Attorney Fees is vacated. TPC's motion for appeal-related attorney fees filed on January 28, 2020 is granted, and the cause is remanded to the district court for determination of the amount. CERTIORARI PREVIOUSLY GRANTED; ORDER OF THE COURT OF CIVIL APPEALS IS VACATED; MOTION FOR APPEAL-RELATED ATTORNEY FEES IS GRANTED; REMANDED TO THE TRIAL COURT. CONCUR: Darby, C.J., Kane, V.C.J., Kauger, Winchester, Edmondson, Combs, Gurich, and Rowe, JJ. RECUSED: Kuehn, J. FOOTNOTES 1 TPC's motion for appeal-related attorney fees provides that "[t]o the extent TPC incurred attorneys' fees exclusively relating to the other issue raised in the appeal, i.e., the District Court's denial of Dr. Patel's request to amend his petition (which did not require interpretation of the Agreement), TPC does not seek those fees." 2 Patel did not seek certiorari from the Court of Civil Appeals's opinion affirming the directed verdict in favor of TPC. Therefore, the correctness of the Court of Civil Appeals's decision that Patel was not an at-will employee is not subject to review on certiorari.

f4a7a4db-c61d-4556-97c7-7f7bdae85253

Harwood v. Ardagh Group

oklahoma

Oklahoma Supreme Court

HARWOOD v. ARDAGH GROUP2022 OK 51Case Number: 118947Decided: 06/01/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JERRY NEAL HARWOOD, Plaintiff/Appellant, v. ARDAGH GROUP, ARDAGH GLASS, INC., Defendant/Appellee, and PATRICK THOM MCLAUGHLAN, Defendant. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I Honorable Douglas W. Golden, Trial Judge ¶0 An automobile driven by the defendant, Patrick McLaughlan, struck Jerry Harwood while Harwood was leaving his work shift and crossing the street to an employer provided parking lot. After an unsuccessful attempt to recover workers compensation benefits for his injuries, Harwood filed a lawsuit against the driver and his employer. The trial court dismissed the lawsuit against the employer for failure to state a claim upon which relief could be granted. Harwood appealed, and the Court of Civil Appeals affirmed. We hold that because an employer may have assumed the duty to provide a safer crosswalk for access to an employer designated parking lot, the employee has pled a claim for relief which is legally possible. The trial court's dismissal was premature. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED AND CAUSE REMANDED. John L. Harlan, Sapulpa, Oklahoma, for Plaintiff/Appellant. Drew A. Lagow, Rhiannon K. Baker, Edmond, Oklahoma, for Defendant/Appellee. KAUGER, J.: ¶1 We granted certiorari to address the dispositive issue of whether the employee pled a claim for relief because the employer may owe a duty to provide a safer crosswalk for employees parking in the employer designated parking lot and accessing the place of employment by using the crosswalk. We hold that because the employer may have assumed the duty to provide a safer crosswalk for access to an employer designated parking lot, the employee has pled a claim for relief which is legally possible.1 The trial court's dismissal was premature. ALLEGED FACTS ¶2 The defendant, Ardagh (Ardagh/employer), employed the plaintiff, Jerry Neal Harwood, (Harwood/employee) at its glass plant in Sapulpa, Oklahoma.2 Ardagh provided hourly employees, such as Harwood, two parking lots across the street (a/k/a Oklahoma State Highway 66) from the glass plant to park their vehicles while at work. Ardagh directed employees to use the marked crosswalk between the plant and the parking lots when crossing the street. ¶3 The crosswalk was covered by overhead stop lights which were activated by the employees from either end of the crosswalk. At night, street lights also lined both sides of the street at and near the marked crosswalk. Although the employer did not own, operate, or control the crosswalks, according to the employee, Ardagh knew that: 1) the stop lights and street lights were inoperable 2 or 3 times a year; 2) on the afternoon of July 14, 2016, the lights were inoperable until July 17, 2016; 3) following a power outage on July 14, 2016, the City of Sapulpa placed a four-way metal stop sign in the center of the intersection adjacent to the marked crosswalk; 4) local City of Sapulpa police were occasionally, but not always, present during shift changes when employees were crossing in the crosswalk; and 5) some motor vehicles did not stop for the crosswalk and/or metal four way stop sign. ¶4 On the night of July 16, 2016, while the stop lights and street lights were not working, a motor vehicle, driven by the defendant, Patrick Thom McLaughlan (McLaughlan), hit Harwood while he was leaving his 11:00 p.m. shift. The employee suffered severe injuries, rendering him permanently and totally disabled for the rest of his life, and unable to work again. ¶5 The employee first sought workers compensation benefits from the employer which were denied because the accident occurred after the employee had "clocked out" and left work. Consequently, the injuries did not arise out of the course of employment and thus were not covered by workers' compensation benefits. The denial of workers compensation benefits is not before us in this cause, and the matter has been concluded. 3 ¶6 On February 8, 2019, the employee filed a lawsuit against Ardagh and the driver who hit him in the District Court of Creek County, Oklahoma. The employee alleged that the driver caused the employee's injuries when he negligently failed to stop at the crosswalk. He also alleged that the employer was a cause of his injuries because the employer negligently failed to ensure adequate lighting and protection for employees crossing the crosswalk. ¶7 On March 5, 2019, the employer filed a Motion to Dismiss for failure to state a claim upon which relief could be granted. It argued that because it did not own, operate or control the crosswalk, and the employee was not within the course and scope of employment at the time of the accident, Ardagh did not have a duty to make the crosswalk safer. Accordingly, because no duty existed, the employer could not be determined to have been negligent as matter of law, and the employee failed to state a claim upon which relief could be granted. ¶8 On April 8, 2019, the trial court agreed with the employer, and granted the employer's Motion to Dismiss for failure to state a claim upon which relief may be granted. However, the trial court also allowed the employee the opportunity to file an amended petition, which the employee did on April 29, 2019. ¶9 In the amended petition, the employee added additional allegations that the employer: 1) instead of providing parking for hourly employees adjacent to the plant, like they did with management, the employer provided hourly employees with two parking lots across a four lane street which it either leased or owned and were surrounded by a chain link fence; 2) the employer instructed the hourly employees to park in the lots and they were forbidden from parking adjacent to the plant; 3) the four lane street was also a four lane state highway and was the most direct route from Sapulpa to Tulsa, thereby making it heavily traveled and a hazard; 4) the transit between the plant and the parking lots was the marked crosswalk; 5) employees were told using the crosswalk was "part of your job" and that it was "the most dangerous part of your job" even if the employees were not "on the clock yet." 6) employees were issued reprimands if they did not use the crosswalk; 7) only plant employees used the crosswalk, as there were no other businesses or homes near it; 8) the employer created a walkway, "cattle chute," in the chainlink fence to the marked crosswalk and another walkway with railings leading from the crosswalk to the plant; 9) even if the street was a public street, the employer's use of the crosswalk was de facto part of its property and constituted a constructive use or occupancy of it; 10) the night before the employee was injured a supervisor placed a set of strobe lights on the four way, temporary, metal stop sign, but took it off at the shift change; 11) the plant manager assisted, and approved of, employees placing another set of strobe lights on the four way stop within two and a half hours after the employee's accident; and 12) the employer represented to employees that it would make the passage across the crosswalk as safe as possible. ¶10 On June 7, 2019, the employer filed a second Motion to Dismiss for failure to state a claim upon which relief could be granted. On September 9, 2019, the employer filed a additional Motion to Dismiss, arguing that because the employee's negligence claims arose out of an employment relationship between the employee and the employer, the employee's remedy was limited to the workers' compensation commission. ¶11 On June 29, 2020, the trial court filed an order dismissing the employer from the lawsuit because the employee failed to state a claim upon which relief could be granted. The court also found that there was no just reason to delay the entry of a final judgment as to the employer.4 The employee appealed, and on April 23, 2021, the Court of Civil Appeals, in an unpublished opinion, affirmed the trial court. The employee petitioned for certiorari in this Court, and we granted certiorari on January 25, 2022, to address the employer's duty under the facts and circumstances alleged in this cause. BECAUSE THE EMPLOYER MAY HAVE ASSUMED THE DUTY TO PROVIDE A SAFER CROSSWALK FOR ACCESS TO AN EMPLOYER DESIGNATED PARKING LOT, THE EMPLOYEE PLED A CLAIM FOR WHICH RELIEF IS LEGALLY POSSIBLE. THE TRIAL COURT'S DISMISSAL WAS PREMATURE. ¶12 The employer argues that because it does not own or control the crosswalk, it had no duty as a matter of law to make the crosswalk any safer. It insists that the employee's only remedy against the employer is through workers' compensation proceedings which have already been pursued. The employee contends that, irrespective of whether the employee was entitled to workers' compensation benefits, the employer assumed the duty to make the crosswalk safer on the day of the accident, but that duty was breached and a cause of the accident. A. Standard of Review/Motion to Dismiss for Failure to State a Claim. ¶13 The trial court dismissed the cause pursuant to the employer's motion to dismiss for the employee's failure to state a claim for negligence against it.5 The trial court determined that no claim existed against the employer because any action of the employer toward making the crosswalk safer would be purely gratuitous, and not a "duty." Consequently, at this juncture, the facts have not been determined and are mere allegations. ¶14 An order dismissing a case for failure to state a claim upon which relief can be granted is subject to de novo review.6 When reviewing a motion to dismiss, the Court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them.7 The purpose of a motion to dismiss is to test the law that governs the claim in litigation, not the underlying facts.8 ¶15 A pleading must not be dismissed for failure to state a legally cognizable claim unless the allegations indicate beyond any doubt that the litigant can prove no set of facts which would entitle the plaintiff to relief.9 Therefore, the precise issue presented on appeal is whether the facts pled may support a claim for relief.10 The burden to show the legal insufficiency of the petition is on the party moving for dismissal.11 Motions to dismiss are usually viewed with disfavor under this standard, and the burden of demonstrating a petition's insufficiency is not a light one.12 B. The Employer/Employee Relationship Status as it Relates to Premises Liability and/or Workers' Compensation Benefits. ¶16 This cause does not concern the award or denial of Workers' Compensation Benefits. The Workers' Compensation coverage issue has already been decided, and the court determined that because the employee had "clocked out" when he was injured in the crosswalk while crossing the highway, he was not injured "in the course of employment" it must deny coverage.13 Nevertheless, a discussion of Workers' Compensation is critical to resolving this cause. Until recently, due to legislative changes, all of our previous decisions regarding employer premises liability for employee accidents were always decided in the context of whether the employee was injured on premises owned or controlled by an employer and whether the injury incurred "in the course of employment." ¶17 However, the most current Workers' Compensation regime, 85 O.S. Supp. 2021 §2(13), draws a line for the employer and employee that essentially the "clock" begins and ends the employer's liability under Workers' Compensation. Unless, the employer owns or maintains exclusive control over the area,14 the statute provides that a compensable injury suffered in the "course of employment" does not include any injury occurring in a parking lot or other common area adjacent to an employer's place of business before the employee clock in or after the employee clocks out This statute was enacted in 2013, when the legislature overhauled all of the Workers' Compensation statutes.15 ¶18 Although the statute was subsequently amended in 2018, 2019, and 2021, the only change made by the legislature, pertinent to our discussion of this cause, was the addition of the clarification language of "unless the employer owns or maintains exclusive control over the area" added in 2021. Prior to this 2021 change, cases generally involved questions such as whether the alleged injury occurred in a parking lot on the employer premises, or close or nearby the employer's premises under the employer's control, coupled with the question of whether the employee was engaged in activity in the furtherance of the employer's business while arriving or leaving the workplace, or on a break.16 ¶19 One such example of that analysis, with a fact pattern very similar to this cause, is Swanson v. General Paint Co., 1961 OK 70, 361 P.2d 842. The employee in Swanson, supra, had parked his car in a employer provided parking lot and, while walking across the Sand Springs Highway, he was struck by an automobile and killed. ¶20 The parking lot was not owned by the employer. Rather the building and grounds of the employer's plant were rented. The landlord furnished the parking lot for the convenience of several tenants and their employees for joint use. The employee, with the consent and acquiescence of the officials of the paint company, parked in the lot and, at one time, the employee even had a marked space with his name on it. The accident occurred at approximately 7:53 a.m. on November 19, 1958, and the employee's hours were from 7:45 a.m. to 4:15 p.m. ¶21 To decide whether the employee was covered by Workers' Compensation death benefits, the Court looked at whether the employee was killed on the employer's premises because the rule at the time was that where a parking lot constituted a part of an employer's premises, an injury incurred in passing from such area to his working place was considered incurring out of and in the course of employment. ¶22 The Swanson Court , supra, held that the fact that the accident happened on a public road is not conclusive against the existence of a causal relationship, if the danger be one which the employee by reason of employment is subjected.17 Several cases after Swanson, supra, involved questions of whether the employer owned or controlled the premises, and whether there was a causal connection between the injury and employment or that the precipitating risk of harm was created or maintained by the employer.18 In one such cause, Bober v. Oklahoma State University, 2016 OK 78, 378 P.3d 562, a cause concerning an employee who was injured when she slipped on an icy curb going into work after parking on an on-premises, employer designated parking lot, Justice Winchester, in his dissent, foreshadowed the circumstances we are faced with in this cause. ¶23 The dissent in Bober, supra, pointed out that the statutory changes reflect a clear line policy decision by the legislature to draw a line for employer liability under Workers' Compensation law that begins and ends with an employee clocking into and out of work, unless directed otherwise by the employer. It went on to say that: ¶3 Workers' Compensation is not an exclusive remedy if the statutes specifically eliminate parking lot injuries as coming within the "course and scope of employment." If there is actionable negligence for a parking lot injury, it is still covered by tort law. The Court's opinion holds that "A parking lot owned or controlled by the employer alone clearly constitutes the 'premises' of such employer, and is part of the 'employer's place of business." However, if the legislature has intentionally excluded the parking lot from the jurisdiction of Workers' Compensation law, the "premises" doctrine is no longer valid. The legislature has the authority and power to make such an exception. I conclude that it "clearly" made such an exception. After Bober, was decided, the legislature, in 2021, clarified that injuries occurring before or after clocking out would be covered only when the premises were under the exclusive control of the employer.19 ¶24 Nevertheless, the dissent also noted that Workers' Compensation is not an exclusive remedy if the statutes specifically eliminate parking lot injuries as coming within the "course and scope of employment." If there is actionable negligence for a parking lot injury, or in this case a crosswalk injury, it is still covered by tort law. We agree that if there is an actionable claim for negligence in this cause, it is covered by tort law and may be brought in the district court and that denial of Workers' Compensation benefits because an employee was not "in the course" of employment does not preclude such a negligence action. This is the policy decision expressly chosen by the Legislature when it eliminated parking lot, and other similar, injuries from coming within the "course and scope of employment." C. A Duty May be Assumed, Supporting an Actionable Negligence Claim. ¶25 Review of dismissals of alleged negligence claims for the failure to maintain a safe crosswalk, or duty to provide a safe crosswalk, ordinarily come before us in the context of a Governmental Torts Claim,20 because, most often, it is a municipality which owns and controls the crosswalk. However, recently, in Teeter v. City of Edmond, 2004 OK 5, 85 P.3d 817, we addressed such a claim against a university. In Teeter, supra, a student was struck by a motor vehicle and seriously injured while crossing a four-lane street maintained by the City of Edmond and which bordered the university. ¶26 Regarding university's alleged duty to maintain or make a crosswalk safer, we explained that the duty can arise when one voluntarily assumes a duty to provide a safer crosswalk. We said: ¶20 Teeter also contends that UCO assumed a duty to provide a safe crosswalk independent of the City's police power. Elements to a claim based upon negligence include (1) a duty to the plaintiff, (2) a violation of that duty, and (3) and injury resulting from that violation. Hesser v. Central National Bank & Trust Company of Enid, 1998 OK 15, ¶ 12, 956 P.2d 864, 867. This Court has previously noted the Restatement (Second) of Torts § 323 (1965), and its standards for attaching liability based upon one who voluntarily assumes a duty. Jackson v. Mercy Health Center, Inc., 1993 OK 155, n. 9, 864 P.2d 839, 842-843. See also, Seavey, Reliance on Gratuitous Promises or Other Conduct, 64 Harv.L.Rev. 913, 928 (1951), ("Where a person represents by word or act that he has done or will do something upon the performance of which he should realize that others will rely, he is liable for expectable harm caused by the reliance of others and his failure of performance, if his representation was negligently or intentionally false, or if without excuse he fails to perform."). Nevertheless, the Court concluded that even if the university undertook a duty to provide a crosswalk, the student's negligence claims were barred by the Governmental Tort Claims Act because the university was the "State" for purposes of the Act, and the Act provided that no negligence-based liability could arise from the failure to initially place road signs or warning signs to make a crosswalk safer.21 ¶27 In this cause, the employer is not an entity protected by the Governmental Tort Claims Act. The standards for attaching liability based upon one who voluntarily assumes a duty squarely apply. Among the traditional elements of the tort of negligence are that there must be: 1) a duty owed by one person to another; and 2) a breach of that duty.22 The threshold question in any suit based on negligence is whether the defendant had a duty to the particular plaintiff alleged to have been harmed.23 ¶28 Here, we are not talking about a duty owed to the general public by the employer. The word "duty' is used throughout the Restatement (Second) of Torts to denote the fact that an actor is required to conduct himself or herself in a particular manner at the risk that if he or she does not do so, liability may extend to another to whom the duty is owed for an injury sustained of which the actor's conduct is a legal cause.24 In this cause, there is the established relationship of employer/employee. Even though the employer may not own or control the street, it owns or controls both premises on each side of the crosswalk. An area of liability in this relationship may arises out of the principles discussed in Teeter, supra, and that of the Restatement (Second) of Torts §323 (1965) which provides: One who undertakes, gratuitously or for consideration, to render services to another which he (or she) should recognize as necessary for the protection of the other's person or things, is subject to liability to the other for physical harm resulting from his (or her) failure to exercise reasonable care to perform the undertaking if: (a) his (or her) failure to exercise such care increases the risk of such harm, or (b) the harm is suffered because of the other's reliance upon the undertaking. ¶29 The allegations are that the employer provided parking for employees and instructed them to park across a busy highway. The employer represented to employees that it would make the passage across the highway as safe as possible, and it recognized the necessity for the protection of the employees crossing to the parking lot by creating a walkway with railings, and placed strobe lights on the four-way stop when the crosswalk lights were out. The allegations in this cause are beyond those of merely promising an undertaking to make crossing safer. The allegations are that the employer previously had taken steps to make the crossing safer, the employees relied on the employer to make the crossing safe, and the employer failed to do so on this occasion which increased the risk of harm to the employee. ¶30 Taken in a light most favorable to the employee, and with all reasonable inferences in his favor, the employee's petition does state an extant duty on the employer to make the crosswalk safer.25 Accordingly, the trial court's dismissal for failure to state a claim for which relief can be granted was premature. This is not to say that the employer is liable as a matter of law. The fact finder will have to make a determination as to whether the duty was breached, and whether the breach was a sufficient cause of the employee's injuries to award damages.26 CONCLUSION ¶31 Because we have held that the employer may have assumed the duty to provide a safer crosswalk for access to an employer designated parking lot, the employee has pled a case for relief which is legally possible. The courthouse doors are open to the employee. Whether or not the actions of the employer were the proximate cause of the injury to the appellant is one for the jury to decide. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED AND CAUSE REMANDED. CONCUR: Darby, C.J., Kauger, Edmondson, Combs and Gurich, JJ. DISSENT: Kane, V.C.J. (by separate writing), Winchester (by separate writing) Rowe and Kuehn, (by separate writing), JJ. FOOTNOTES 1 The dissents agree that this cause does not belong in the workers' compensation court, yet they treat this cause as though it stands for employer-based strict liability for employees. This is not the case -- far from it. It may well be that the employer is determined to have no liability, or that the employee's negligence and/or the driver's negligence completely absolve the employer of any liability. This cause is before the court on a motion to dismiss, and under the ordinary negligence principles as outlined in this cause, the employer may have assumed a duty that may be a contributing factor to the employee's injuries -- at least to the extent that a dismissal is premature. 2 The petition filed February 8, 2019, in the District Court of Creek County states that Jerry Neal Harwood, was an employee of Ardagh Group which owns and operates the plant in Sapulpa, and that the plant was nominally owned and operated by Ardagh Glass, Inc., which is a wholly owned subsidiary of Ardagh Group. For purposes of this appeal, we refer to Ardagh as the employer without distinguishing between Ardagh Group and/or Ardagh Glass, Inc. 3 The workers compensation action culminated in an opinion by the Oklahoma Court of Civil Appeals, Harwood v. Ardach Group, 2019 OK CIV APP 11, 435 P.3d 121, filed on July 20, 2018, which affirmed the denial of workers' compensation benefits. 4 Title 12 O.S. 2011 §994A provides: A. When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the preparation and filing of a final judgment, decree, or final order as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the filing of a final judgment, decree, or final order. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the final judgment, decree, or final order adjudicating all the claims and the rights and liabilities of all the parties is filed with the court clerk. 5 Title 12 O.S. 2011 §2012 provides in pertinent part: B. HOW PRESENTED. Every defense, in law or fact, to a claim for relief in any pleading, whether a claim, counterclaim, cross-claim, or third-party claim, shall be asserted in the responsive pleading thereto if one is required, except that the following defenses may at the option of the pleader be made by motion: . . . 6. Failure to state a claim upon which relief can be granted; . . . 6 Ho v. Tulsa Spine & Specialty Hoptial, L.L.C., 2021 OK 68, ¶9, __ P.3d __; Tuffy's Inc. v. City of Oklahoma City, 2009 OK 4, ¶6, 212 P.3d 1158; Gens v. Casady School, 2008 OK 5, ¶8, 177 P.3d 565. 7 Ho v. Tulsa Spine & Specialty Hoptial, L.L.C., see note 6, supra; Tuffy's Inc. v. City of Oklahoma City, see note 6, supra; Gens v. Casady School, see note 6, supra. 8 Ho v. Tulsa Spine & Specialty Hoptial, L.L.C., see note 6, supra; Tuffy's Inc. v. City of Oklahoma City, see note 6, supra; Gens v. Casady School, see note 6, supra. 9 Tuffy's Inc. v. City of Oklahoma City, see note , supra; Brown v. Founders Bank and Trust Co., 1994 OK 30, ¶8, 890 P.2d 855. 10 Ho v. Tulsa Spine & Specialty Hoptial, L.L.C., see note 6, supra; Brown v. Founders Bank and Trust Co., see note 8, supra. 11 Tuffy's Inc. v. City of Oklahoma City, see note 6, supra; Gens v. Casady School, see note 6, supra. 12 Tuffy's Inc. v. City of Oklahoma City, see note 6, supra; Gens v. Casady School, see note 6, supra. 13 Harwood v. Ardach Group, see note 3, supra. 14 Title 85A O.S. 2021 §2(13) provides: 13. "Course and scope of employment" means an activity of any kind or character for which the employee was hired and that relates to and derives from the work, business, trade or profession of an employer, and is performed by an employee in the furtherance of the affairs or business of an employer. The term includes activities conducted on the premises of an employer or at other locations designated by an employer and travel by an employee in furtherance of the affairs of an employer that is specifically directed by the employer. This term does not include: a. an employee's transportation to and from his or her place of employment, b. travel by an employee in furtherance of the affairs of an employer if the travel is also in furtherance of personal or private affairs of the employee, c. any injury occurring in a parking lot or other common area adjacent to an employer's place of business before the employee clocks in or otherwise begins work for the employer or after the employee clocks out or otherwise stops work for the employer unless the employer owns or maintains exclusive control over the area, or d. any injury occurring while an employee is on a work break, unless the injury occurs while the employee is on a work break inside the employer's facility or in an area owned by or exclusively controlled by the employer and the work break is authorized by the employee's supervisor; 15 The relevant statute prior to 2013, was 85 O.S 2011 §85 which provided in pertinent part: 5. An injury which occurs outside the course of employment. Employment shall be deemed to commence when an employee arrives at the employee's place of employment to report for work and shall terminate when the employee leaves the employee's place of employment, excluding areas not under the control of the employer or areas where essential job functions are not performed; provided, however, when the employee is instructed by the employer to perform a work-related task away from the employee's place of employment, the employee shall be deemed to be in the course of employment when the employee is engaged in the performance of job duties directly related to the task as instructed by the employer, including travel time that is solely related and necessary to the employee's performance of the task. Travel by a policeman, fireman, or a member of a first aid or rescue squad, in responding to and returning from an emergency, shall be deemed to be in the course of employment. This statute was enacted in 1915 and amended numerous times until it was repealed with the 2013 overhaul. 16 Johnson v. Midwest City Del City Public School, 2021 OK 29, ___ P.3d __ [Claimant was acting within the course and scope of employment when she slipped and fell in parking lot of smoke-free campus while walking back from smoke break.]; Pina v. American Piping Inspection, 2018 OK 40, 49 P.3d 231[Pipeline fitter injured at a stop for furtherance of employer's benefit.]; Brown v. Claims Management Resources, 2017 OK 13, 391 P.3d 111 [Petitioner was injured while, after clocking out, when he fell down an stairwell inside the building he worked in.]; Bober v. Oklahoma State University, 2016 OK 78, 378 P.3d 562 [Employee injured when she slipped on an icy curb going into her workplace building after parking on an on-premises, employer-designated parking lot]. 17 It also determined that: 1) It is not necessary that the area where an employee is injured is wholly controlled by the employer; 2) Nor is it necessary that such property be directly owned or controlled by the employer; 3) The parking area in question was a portion of the premises of the employer; 4) The injury occurred in going from one portion of the employer's premises to another portion and in doing so, crossing the highway could not be avoided; 5) Where the only route from one portion of an employer's premises used by employees to reach another portion of the employer's premises to access where labor is to be performed include crossing a highway, a special hazard exists; and 6) An injury incurred on such highway crossing arises out of and in the court of employment. 18 Turner v. B Sew Inn, 2000 OK 97, 18 P.3d 1070 [Parking lot]; Fudge v. University of Oklahoma, 1983 OK 67, 673 P.2d 149 [Crossing street]; Thomas v. Keith Hensel Optical Labs, 1982 OK 120, 653 P.2d 201 [Parking lot]; Belscot Family Center v. Sapcut, 1973 OK 41, 509 P.2d 905 [Sidewalk]; White v. Milk Producers, Inc., 1972 OK 48, 496 P.2d 1172 [Sidewalk]; Hedge v. Pittman, 1970 OK 91, 471 P.2d 888 [Parked on street]; Walk v. S.C. Orbach Co., 1964 OK 114, 393 P.2d 847 [Parking lot]; Carney v. Direct Group, Inc., 20014 OK CIV APP 4, 316 P.3d 234 [Parking lot]. 19 See discussion page 15, supra. 20 Title 51 O.S. 2011 §§151 et seq. 21 Even without a specific provision relating to road or warning signs, we have previously held that allegations of failure to install maintain traffic control devices, failure to provide patrol services and failure to light the streets are allegations of a discretionary function and not actionable under the Governmental Torts Claims Act. 51 O.S. §§151 et seq. Ochoa v. Taylor, 1981 OK __, 635 P.2d 604; See also, Kirk v. City of Muskogee, 1938 OK __, 83 P.2d 594. But exceptions have been noted once the entity decides to construct a public improvement, then the decisions regarding safety or maintenance of the improvement are operational decisions which are actionable. Robinson v. City of Bartlesville Bd. of Educ., 1985 OK 39, 700 P.2d 1013; Walker v. City of Moore, 1992 OK 73, 837 P.2d 876. 22 Hesser v. Central National Bank & Trust Co., of Enid, 1998 Ok 15, ¶12, 956 P.2d 864; Wofford v. Eastern State Hospital, 1990 OK 77, ¶7, 795 P.2d 516; Thompson v. Presbyterian Hospital, 1982 OK 87, ¶7, 652 P.2d 260. Prima facie of medical malpractice, just like all negligence claims are duty, breach, and proximate cause. Robinson v. Oklahoma Nephrology Associates, Inc., 2007 OK 2, ¶9, 154 P.3d 1250. 23 Wofford v. Eastern State Hospital, see note 21, supra; Rose v. Sapulpa Rural Water Co., 1981 OK 85, ¶17, 631 P.2d 752. 24 Jackson v. Mercy Health Center, Inc., 1993 OK 155, ¶5, fn. 8, 864 P.2d 839. 25 Other courts have reached differing results. Donavan v. Jones, 658 So. 2d 755 (La.App. 2 Cir. 1995) [Employer owed duty to employee of independent contractor to exercise reasonable care for his safety and not expose him to unreasonable risks of injury or harm once it designated a parking lot across a major highway for contractor to park. Employer provide reasonably safe access to work premises and may have contributed substantially to the dangerous condition, regardless of the state's duty to maintain the highway. Chadwell v. Clements, 18 Kan. ApP.2d 84, 847 P.2d 1344 (1993) [Employer owed no duty to keep crosswalk safe merely because the county adopted some of the employer's suggestions to make crossing of public street safer for employees.]. 26 The cause of a plaintiff's injury is normally a question of fact for the jury to decide. Robinson v. Oklahoma Nephrology Associates, Inc., see note 20, supra; Johnson v. Hillcrest Health Center, Inc., 2003 OK 16, ¶18, fn. 25, 70 P.3d 811. KANE, V.C.J., with whom Kuehn, J. joins, dissenting: ¶1 The Majority expands the concept of duty in premises liability cases by increasing potential liability to private employers and/or private business owners far beyond what our case law has provided for in the past. The Majority creates a new duty of care for the employer to provide safe passage to its employees on public streets, over which the employer has no ownership or control. Such a result creates unprecedented exposure for private business owners all across our State. ¶2 The Majority holds that "the employer may have assumed a duty to provide a safer crosswalk for access to an employer designated parking lot" and thus, "employee has pled a case for relief which is legally possible" via the filing of employee's Amended Petition. See Majority Op. ¶ 31 & n.1. However, a duty must rightfully exist in our law before it can be violated. In Craft v. Graebel--Oklahoma Movers, Inc., 2007 OK 79, ¶ 27, 178 P.3d 170, 178, this Court held: To establish a prima facie case of negligence, a plaintiff must show: first, that the defendant had a duty to protect the plaintiff from injury; second, that the defendant failed to properly exercise or perform that duty, and third, that the defendant's failure to properly exercise or perform that duty caused the plaintiff's injury. (emphasis added). ¶3 Taking all of the allegations of the employee together with all reasonable inferences which may be drawn from them as true when reviewing a motion to dismiss,1 it appears that the employer attempted, prior to the accident, to help some of its employees cross the public street using the crosswalk. However, Oklahoma law has never implied a duty or standard of care for an employer to provide or maintain a safe or "safer" crosswalk for employees. ¶4 In footnote 1 of the Majority opinion, it is suggested that the facts may eventually establish that no duty existed, but this misses the point.2 Under the facts of this case, the case cannot proceed beyond the employer's motion to dismiss because additional facts cannot cure the fact that no duty exists. See Craft, 2007 OK 79, ¶ 27, 178 P.3d at 179; Hesser v. Central Nat. Bank & Trust Co. of Enid, 1998 OK 15, ¶ 12, 956 P.2d 864, 867 (the elements of a claim of negligence are: (1) a duty to the plaintiff, (2) a violation of the duty, and (3) an injury resulting from the violation). ¶5 Despite conceding ownership and control of the public street by the City in this case, the Majority seeks to impose a duty and/or allow the assumption of a duty upon a private employer and/or private business owner, who has no right, power, or authority to regulate the public street. This cannot be the end result and our prior precedent does not support this conclusion. It is the State who delegates police power to a city to regulate traffic on a public street and it is a power that a city cannot surrender. See Teeter v. City of Edmond, 2004 OK 5, ¶ 17, 85 P.3d 817, 822 (a municipality's power to regulate traffic on a public street is an exercise of police power delegated from the state that cannot be redelegated); White v. City of Lawton, 1961 OK 287, 373 P.2d 25, 27 (a municipality's power to regulate traffic on a public street is the exercise of police power delegated from the state). ¶6 There is no dispute over who owned, operated, and/or controlled the public street -- it is the City. It is undisputed there was a power outage resulting in all of the public street lights to be out, as well as the public crosswalk lights to be out at the time of the accident. It is likewise undisputed that the City police were not present to assist and bring attention to the crosswalk during the employees' shift change, as they had done in the past. It is also undisputed the employer let the City know about the power outage, as was the employer's common practice. ¶7 After the power outage, the City placed a four-way metal stop sign in the center of the intersection. This was a decision made solely by the City, as the undisputed owner and operator of the public street. The Majority concedes this important fact and acknowledges that the majority of cases this Court has decided involving the duty to provide safe passage on a public street are in the context of claims under the Governmental Tort Claims Act (GTCA), 51 O.S.2021 ch. 5, §§ 151-172, wherein the public street is owned by the state entity -- like the City in this case. In those cases, we have held that allegations of failure to install or maintain traffic control devices, lighting, and providing patrol services are discretionary functions of the state entity and not actionable under the GTCA. See Majority Op. ¶ 26 n.20. ¶8 The fact that the employee was struck by a motorist at the crosswalk on a public street and sustained serious injuries is tragic; however, the employee is not left without a remedy at law. As the Majority lays out, the employee originally sought compensation from his employer in the Workers' Compensation Court. The Majority correctly points out that the case did not fall within the Administrative Workers' Compensation Act (Workers' Compensation Act), 85A O.S.2013 §§ 1 et seq., because the employee had "clocked out" and was not injured "in the course of his employment." See Majority Op. ¶¶ 5 n.2, 16. ¶9 Despite reaching this conclusion, the Majority devotes a whole section to the "Employer/Employee Relationship Status as it Relates to Premises Liability and/or Workers' Compensation Benefits," which can be summed up as irrelevant to the facts of this case due to subsequent statutory amendments to our Workers' Compensation Act. See Majority Op. ¶¶ 16-24. Our current Workers' Compensation Act reflects a clear line policy decision by the legislature that employer liability begins and ends with an employee clocking into and out of work. See 85A O.S.2021 § 2(13). ¶10 In this case, it is undisputed the employee was "clocked out" at the time of the accident. It is also undisputed that the public street the employee was crossing was solely owned, operated and/or maintained exclusively by the City. Thus, the relationship between the employee and the employer is irrelevant for purposes of our analysis here, other than noting prior versions of the Workers' Compensation Act may have resulted in a different outcome -- which matters not. ¶11 While the conditions at the crosswalk were allegedly problematic, they were no more under the control of the employer than they were of the employee. As a result, the employee's remedy for injuries sustained is one in negligence against the motorist who hit him as he crossed the public street using the crosswalk3 -- not against his employer for negligence. To hold otherwise as the Majority suggests, would open a floodgate of employer liability based on an undefined and enhanced duty owed by the employer to the employee, which is not supported by our case law. For this reason, I respectfully dissent. FOOTNOTES 1 See Tuffy's Inc. v. City of Oklahoma City, 2009 OK 4, ¶ 9, 212 P.3d 1158, 1162 ("When reviewing a motion to dismiss, the Court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them."). 2 In response to the dissents filed in this case by J. Winchester and J. Kuehn, the Majority revised its opinion by adding n.1, which provides, in relevant part: The dissents in this case . . . treat this cause as though it stands for employer-based strict liability for employees . . . . This is not the case -- far from it . . . . This cause is before the court on a motion to dismiss, an under the ordinary negligence principles as outlined in this cause, the employer may have assumed a duty that may be a contributing factor to the employee's injuries -- at least to the extent that a dismissal is premature. Majority Op. n.1. 3 It should be noted that the employee did indeed file a lawsuit for negligence against the motorist who hit him with his car as he crossed the street via the crosswalk. This is the correct procedural vehicle for the damages employee sustained. Otherwise, we are left with a chilling effect that undermines public safety over the threat of litigation. Winchester, J., with whom Rowe, J., and Kuehn, J. join, dissenting: ¶1 My complaint with the majority is that it creates a duty for the employer to provide safe passage on a public street. There is no dispute over who owned, operated, or controlled the public street: the City of Sapulpa (City). The employer therefore owed no duty to the employee, and anything the employer did to help provide safe passage on the public street did not give rise to a duty of care. ¶2 The majority relies on Teeter v. City of Edmond, 2004 OK 5, 85 P.3d 817, in expanding the employer's duty to a public street. However, the Teeter Court specifically pointed out that the plaintiff had not provided any law to support the university's authority to control traffic on the public street adjacent to the university. Id. ¶ 19, 85 P.3d at 823. The Court further noted that despite the fact that the university requested that the city address the issue with the public street and then, with the city's approval, purchased and installed flashing pedestrian warning signs, the city did not delegate a duty to the university. Id. The Teeter Court clarified that the State delegates police power to a city to regulate traffic on a public street; a power that a city cannot surrender. Id. ¶ 18, 85 P.3d at 823. ¶3 We held similarly in Ochoa v. Taylor, 1981 OK 120, 635 P.2d 604, where a pedestrian was hit by a vehicle when crossing a public street after leaving a high school football game. The pedestrian sued both the cities of Bethany and Oklahoma City and the high school, alleging they had a duty to provide some protection when the pedestrian crossed the street. Our Court distinguished the cities' duties from the high school's duties. We noted that maintenance of streets is a proprietary function of cities, but there is no legally enforceable duty upon a city to regulate and control traffic or provide police protection. Id. ¶ 7, 635 P.2d at 607. The Court then addressed the high school's duty regarding public streets and found no authority for imposing such a duty on the part of the high school on property neither owned nor leased by the high school, i.e., the center of a public street. Id. ¶ 9, 635 P.2d at 607. ¶4 Here, it was within the discretion of the City to determine how to exercise its police power regarding what safety measures it would take for the crosswalk prior to and during the power outage. The crosswalk was covered by overhead stoplights placed and operated by the City. Street lights operated by the City lined both sides of the street. After the power outage, the employer contacted the City (which was customary), and the City placed a four-way metal stop sign in the center of the intersection. Police officers provided by the City were occasionally present during shift changes when employees were crossing in the crosswalk. These safety measures were all done by the City because it owned and controlled the public street. ¶6 The majority correctly points out that most cases this Court has decided involving the duty to provide safe passage on a public street are in the context of claims under the Oklahoma Governmental Tort Claims Act (GTCA), 51 O.S.2021, ch. 5, §§ 151-172, https://govt.westlaw.com/okjc. This point matters because a state entity like the City owns and controls the public street. The majority admits that in those cases, we have held that allegations of failure to install or maintain traffic control devices, provide patrol services, and light streets are discretionary functions of the state entity and not actionable under the GTCA. See Majority Op. ¶ 26 n.20. Yet today's pronouncement imposes a duty on private employers, and potentially private business owners, for such actions where the city, who owns and controls the public street, would be immune; this duty is too far-reaching. ¶7 The employer did not have a statutory or common law duty to assume the City's discretionary right to regulate and control the use of its streets. As a result, the employer had no duty to improve the safety measures taken by the City. To hold otherwise expands the duty of employers (and business owners) everywhere to ensure safe passage for employees (and all customers who use that business) on any public street adjacent to the employer's business. For this reason, I respectfully dissent. KUEHN, J., DISSENTING: ¶1 The Majority concludes that, given Plaintiff's factual allegations, there is a legal avenue for holding Ardagh liable for negligence. The gist of Plaintiff's argument is that Ardagh broke its promise to make his crossing the street "as safe as possible." For the reasons below, I dissent. ¶2 The Majority correctly notes this case does not fall within the Worker's Compensation Act. And it correctly finds that the traditional standards for voluntarily assuming a duty -- a "gratuitous undertaking" -- still apply. Opinion at ¶ 27. But the Majority goes on to suggest some undefined, enhanced duty on Ardagh's part by virtue of its status as Plaintiff's employer. Opinion at ¶ 28. The Majority cites no authority to support this new standard of care. Plaintiff made the same argument on appeal; but as the COCA observed, even Plaintiff acknowledged that there are no Oklahoma cases supporting it. ¶3 Ardagh's liability, if any, is based on the concept of a "gratuitous undertaking," discussed in Section 323 of the Restatement (Second) of Torts, which this Court has adopted in several cases. See Teeter v. City of Edmond, 2004 OK 5, ¶ 20, 85 P.3d 817, 823.1 Enhanced duty, or special relationship, are not part of the basic equation. Of course, the relationship between the parties might tell us why one undertook certain measures, or why the other relied on those measures. But there is no extra legal duty simply by virtue of the fact that Plaintiff was employed by Ardagh. ¶4 Under Section 323, a gratuitous undertaking to render services for the protection of another can result in liability if the provider does not use reasonable care, and (a) thereby increases the risk of harm, or (b) harm results from another's reliance on the provider's undertaking. Plaintiff's own facts -- which we take as true at this stage of the litigation -- demonstrate that he meets neither of these alternative conditions. ¶5 Ardagh does not deny it took pains to get its employees safely from the factory to the parking lot, including makeshift lighting and makeshift "crossing guards" at times during the power outage. But these measures were indisputably not in place at the time of the accident. Plaintiff's argument is not that he relied on measures that he thought were in place, but in fact weren't; his argument is that Ardagh promised to make crossing "as safe as possible," and it didn't. The temporary measures certainly show that Ardagh cared about its employees' well-being. The absence of such measures at the time Plaintiff was injured may bolster his argument that the promise was not kept, but one cannot rely on something that is not there. ¶6 In Chisolm v. Stephens, 365 N.E.2d 80 (Ill.App. 1977), a tenant sued her landlords for negligence, after she slipped and fell on ice and snow that had accumulated on a sidewalk within the premises. Tenant claimed, inter alia, that the landlords' years-long practice of clearing such winter accumulation from the sidewalk gave rise to a duty to keep doing so, and that their omission to do so, on the day of her injury, rendered them liable. The appellate court affirmed the trial court's order granting summary judgment to the landlords. In doing so, the court discussed at length the concept of gratuitous undertaking, and the difference between undertakings that permanently alter conditions for the worse, versus undertakings that are discrete and temporary: [E]ven a person who has gratuitously assumed to protect others against injury is under no obligation to continue that protection indefinitely. ... The instant case involves non-feasance, a complete omission or failure to perform, rather than misfeasance, a negligent performance. Here the issue is not defendants' manner of performance in clearing the ice from the sidewalk but whether they had any duty to perform the clearing on the day of the incident. A question of legal duty rather than a question of due care. Id. at 85-86. Reliance may reasonably be placed where there is a deceptive appearance that performance had been made, or where a representation of performance has been communicated to plaintiff by defendant, or where plaintiff is otherwise prevented from obtaining knowledge or substitute performance of the undertaking. But, to justify reliance, plaintiff must be unaware of the actual circumstances and not equally capable of determining such facts. Id. at 86. In other words (consistent with Section 323 of the Restatement, discussed in Chisolm), if the undertaking was temporary -- such that it did not alter the conditions knowable by the plaintiff -- then the issue is one of law (legal duty), not one of fact (reliance). In the instant case, there was no undertaking by defendants on the morning of [the injury] to clear the sidewalk of ice nor to apply salt. ... Defendants did not entrap plaintiff by concealing facts which ordinary inspections would not reveal. Defendants did nothing to aggravate or make the ice condition more dangerous. Neither did they misrepresent that any action had been taken by them or misrepresent the condition of the sidewalk on the morning in question. Defendants did nothing to prevent plaintiff from obtaining information as to the conditions or from taking precautionary steps on her own behalf. ... Plaintiff's reliance under these circumstances could not be justified and would be unreasonable. Similarly, any reliance by plaintiff on the prior performances by defendants of ice and snow removal in the past is unjustified and unreasonable. Each prior snow and ice fall was an individual and temporary condition, unrelated to the present condition. The requisite reliance is not present in the instant case. No legal duty arose from the facts that defendants theretofore cleared the sidewalk of snow and ice, and defendants are not negligent as a matter of law. ... Id. at 87 (emphasis added).2 ¶7 The implication in the present case seems to be that all of Ardagh's measures to make the crossing safer during the outage gave Plaintiff a false sense of security. But if these measures were not in place when Plaintiff crossed the street, how could he have relied on them, justifiably or otherwise? Plaintiff does not claim that, at the time of the injury, he believed some safety measures were in place that he could not see. Nor does he claim that the temporary measures somehow made the crosswalk more dangerous than the City had left it. At the moment he decided to cross the street, Plaintiff knew the lay of the land. The facts he has alleged cannot support liability under the gratuitous-undertaking theory. Holding Ardagh liable for not making the crossing "as safe as possible" (whatever that means) would transform it into an insurer or guarantor of employee safety, and hints at strict liability.3 ¶8 The fact that Plaintiff was seriously injured by a motorist is indeed unfortunate. But the Majority's decision will not make such situations any safer. They are likely to do the opposite, by discouraging employers (or anyone else) from assuming the role of the Good Samaritan. ¶9 Accordingly, I dissent. FOOTNOTES 1 See also Lay v. Dworman, 1986 OK 85, 732 P.2d 455, 459, where this Court adopted the principles of Section 323 to consider a landlord's liability for failure to maintain the security of premises leased to a tenant. 2 Similarly, in Chadwell v. Clements, 847 P.2d 1344, 1349-50 (1993), the Kansas Court of Appeals affirmed the grant of summary judgment to an employer, sued by an employee for injuries sustained while crossing a public street that separated the plant from the employees' parking lot. Employee claimed, inter alia, that his employer gratuitously assumed a duty to provide safe passage by (among other things) occasionally deploying a security guard to help employees cross in the past. The appellate court noted that the employee could not have relied on the crossing guard, because none was present at the time he was injured, and that the employer's past measures had not rendered the crossing more dangerous than it already was. 3 The fact that Ardagh's management expressed concern for employee safety does not, of itself, create a duty to take action. Restatement (Second) of Torts, § 314.

a9d93be2-636a-4a72-85c5-c38811e0d38b

Walterscheidt v. Hladik

oklahoma

Oklahoma Supreme Court

WALTERSCHEIDT v. HLADIK2022 OK 57Case Number: 119049Decided: 06/14/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN RE THE GUARDIANSHIP OF: CONNIE WALTERSCHEIDT KENT WALTERSCHEIDT, APPELLANT, V. CHRISTY HLADIK, APPELLEE. APPEAL FROM THE DISTRICT COURT OF KINGSFISHER COUNTY, STATE OF OKLAHOMA, HONORABLE LANCE SCHNEITER ¶0 Husband filed a petition seeking appointment as guardian over his wife. The parties' daughter, Christy Hladik, objected and sought to have herself appointed. An evidentiary hearing was held on February 20, 2020. On July 27, 2020, the trial court entered the Court's First Amended Plan for Care and Treatment of Ward and Management of Property of the Ward. On August 10, 2020, the trial court appointed daughter as guardian over the person and property of Wife. Husband appealed, and on this Court's own motion, the matter was retained. After reviewing the record and briefs, we affirm the trial court's rulings. TRIAL COURT ORDERS APPOINTING GUARDIAN AND APPROVING GUARDIANSHIP PLAN AFFIRMED Grace K. Yates, Holmes, Yates, and Johnson Law Firm, Ponca City, OK, for Appellant Randy J. Long, Long, Claypole & Blakely Law, PLC, Enid, OK, for Appellee Frank Austin, Okarche, OK, for Ward GURICH, J. Facts & Procedural History ¶1 The hearing in this case was conducted on February 20, 2020. At the time, Husband and Wife had been married for nearly 34 years. During the entirety of this period, the couple resided on their family farm near the City of Hennessey, Kingsfisher County, Oklahoma, where Husband was engaged in a full-time farming operation. During their marriage, the Waltersheidts had two biological children together, Georgia Walterscheidt and Mary Milacek. In addition, Husband legally adopted Wife's child from a previous relationship, Christy Hladik, when she was five years old. Georgia and Christy are also residents of Hennessey, while Mary resides just north in nearby Waukomis, Oklahoma. ¶2 In addition to assisting in the farming operation, Wife was employed as a phlebotomist with Oklahoma Blood Institute for roughly twenty-five years. In approximately July of 2016, Wife began struggling with certain aspects of her work, including operating OBI equipment. On August 23, 2017, Husband took Wife to see a neurologist, Dr. Salomi T. Salins, to investigate her escalating memory problems. The records from this visit indicate that Dr. Salins did not believe Wife was suffering from dementia; rather, they suggest Wife was more likely experiencing depression, anxiety and possible marital difficulties. Dr. Salins referred Wife for additional testing and scheduled a follow-up appointment. In September or October 2017, Wife took time off from OBI and never returned to work.1 Wife again saw Dr. Salins with her daughter Christy in October 2017. Notes from that visit again reveal Dr. Salins had doubts that "[Wife] truly has a neurodegenerative disorder."2 Instead, Dr. Salins believed Wife was experiencing underlying depression. However, following a scan of Wife's brain, Dr. Salins' records from the following month denote that early onset Alzheimer's dementia was the probable diagnosis. Dr. Salins recommended further evaluations such as spinal fluid testing and a thorough neuropsychology assessment. She also encouraged Wife to apply for disability benefits; stop using the farm tractor; and limit any driving to familiar areas during daylight hours. At a one-year follow-up appointment, Dr. Salins documented a significant decline in Wife's cognitive assessment score. ¶3 Husband was not present for the November 9, 2017, appointment with Dr. Salins. However, Wife was accompanied by her sister Debbie Gritz. When Debbie dropped Wife off at the couple's home after the appointment, she informed Husband of the Alzheimer's diagnosis. Debbie also relayed Dr. Salins' instructions that Wife should no longer utilize farming equipment, drive on the highway, or drive at night. Husband became upset and asked Debbie to leave the property. She refused to leave and Husband told Debbie "[i]f [he] wasn't a gentleman, [he] might knock [Debbie] out."3 Despite the threatening statement, there was no evidence in the record that Husband had ever been physically violent with Wife or any other members of the family. In fact, the only evidence in the record relating to physical violence revealed an incident between Wife and Debbie, Christy, and Georgia. Debbie acknowledged a confrontation occurred between Wife and the three women after they attempted to discuss Wife's guardianship. During this episode, Wife became agitated and the women subdued her, which left bruising on the inside of Wife's arms.4 Debbie admitted that Wife did not want to discuss issues she felt were personal family issues with her sister and daughters, yet the group of women still physically detained her and forced her to discuss these matters. In addition to Debbie's testimony, Wife's injuries and the altercation were both documented in a DHS report.5 ¶4 The day before Dr. Salins made her preliminary diagnosis of early onset Alzheimer's dementia, Debbie took Wife to execute a Durable Power of Attorney, giving authority over Wife's affairs to Debbie and Wife's other sister, Vickie Elmer.6 The DPOA did not contain a clause nominating a guardian. Three days later, Debbie applied for Social Security disability benefits on behalf of Wife, and the application was later approved with an established onset date of September 2017. With Debbie's assistance, Wife opened a bank account at Central National Bank for the deposit of Social Security payments. Neither Debbie, Vickie, nor Wife informed Husband about the DPOA, the bank account, or that Wife had been approved for disability payments. Banks records indicate Social Security payments were deposited into the Central account beginning on April 25, 2018. ¶5 At the end of 2018 and early part of 2019, Husband discovered the existence of Wife's Social Security disability payments, the Central National account, and the DPOA. By March 2019, there was more than $16,000.00 in Wife's account. Debbie withdrew most of the funds from the Central account in October 2019, because she believed Wife was attempting to make withdrawals. She deposited the money with a different bank and placed both her name and Wife's name on the account; additionally, Debbie removed Wife's ability to make withdrawals on her own.7 ¶6 Wife was again referred for an appointment with Sarah Coats, Ph.D., this time by Charles Ferrell, M.D.8 According to Wife's medical records, Dr. Ferrell asked Dr. Coats to evaluate Wife's cognitive status, including her competency to revoke the DPOA and her capacity to execute a new durable power of attorney. During the evaluation in April of 2019, Wife initially told Dr. Coats she had no recollection of executing the November 2017 DPOA. However, when interviewed alone, Wife said she remembered signing the DPOA but had no idea what was contained in the document. After interviewing both Wife and Husband and conducting testing, Dr. Coats reported that it was her professional opinion that Wife was not competent to revoke the DPOA. Dr. Coats noted that Wife's "dementia is significant enough at this point to impact competence;" she additionally felt Wife was no longer competent to manage her affairs, revoke her DPOA, or execute any new legal document.9 Dr. Coats recommend appointment of a legal guardian, explaining that based on the "complicated psycho-social stressors and apparent family discord . . . a legally appointed surrogate is recommended."10 ¶7 On September 26, 2019, Husband filed a petition seeking appointment as guardian over Wife's person and property. Christy objected to Husband's appointment and requested that she be named the guardian. In her objection and petition for appointment, Christy alleged that Husband was not fit to serve as Guardian because he was guilty of emotional abuse and repeatedly ignored doctor's orders and advice. Wife was represented separately by court-appointed counsel. Five witnesses were called to testify: Husband, Wife, Mary, Debbie, and Christy. ¶8 Husband testified that he reluctantly filed for guardianship after discovering the DPOA, disability payments, and bank account. Husband noted that he did not learn about the DPOA until hospital staff brought the document to him while Wife was preparing to undergo a medical procedure in early 2019. He further testified that funds from Social Security disability were intended to supplement Wife's loss of income associated with her inability to work, yet Debbie's actions made them inaccessible to either Husband or Wife.11 Husband explained that for almost 34 years, he and Wife had "always been a team," and he had made a commitment to her in good times and bad. He further testified that he loved Wife and in the two years following Wife's diagnosis, the two have been almost inseparable. Together, they worked on their farm, fed the animals, babysat their grandson, and socialized in town. Husband testified that the pair have never been happier than they are now. ¶9 Husband did acknowledge he and Wife had a less than perfect marriage and at times the pair had yelled at each other. During direct examination, he denied being verbally abusive; however, he did concede that he and Wife "both holler[ed] at one another."12 All of the witnesses denied any physical violence between Husband and Wife. At the time of the hearing, Husband did not believe Wife was totally incapacitated. Medical records of both Dr. Salins and Dr. Coats suggested limiting Wife's use of farm equipment, but neither advocated total abstention from driving. Husband testified that it was not until January 2020 that Dr. Salins recommended Wife refrain from driving any vehicles. Although he had previously allowed Wife to continue driving farm machinery and help with farming operations until late 2019, Husband testified that he would prevent her from driving a car or farm equipment in the future based on the advice of Dr. Salins. ¶10 Wife testified unequivocally that she wanted to continue living on the farm with Husband and, if she were required to have a guardian, she would like it to be her Husband. Wife testified that she was no longer driving, but felt competent to do some house and farm work. Husband, Wife, and Christy all testified that they believed it was good for Wife to continue helping on the farm, taking care of her grandson, and socializing with her friends in Hennessey. Additionally, Wife's appointed attorney advocated for Husband to be appointed guardian because he also believed that it was in Wife's best interest to remain on the farm with Husband. Wife denied that Husband had been verbally abusive, but acknowledged that she and Husband both had gotten upset and raised their voices. Wife testified that she loves Husband and wants to remain at the parties' farm under his care. Further, she testified that Debbie forced her to execute the power of attorney, although Debbie and Christy both testified that Wife executed the DPOA voluntarily. ¶11 Mary testified that she did not have an opinion as to who should be the guardian of Wife's person; however, she thought Christy would be a better manager of Wife's finances. Mary, Debbie, and Christy believed that Husband had mismanaged some of the couple's finances in the past; however, there was no documentary evidence in the record to support that testimony. Mary spoke at length about an inadvertent phone call Husband made to Mary that was the primary incident used to support Christy's allegation of emotional abuse. During this call, Husband used offensive and disparaging language about the parties' daughters, Wife, and Wife's family. Mary testified that her parents have had arguments like that her whole life. She also testified that at the end of the call, she heard Wife say, "Give me the damn phone." After the phone call, Wife's daughters and Debbie confronted Wife about the call, and Debbie's daughter reported the incident to the Oklahoma Department of Human Services - Adult Protective Services. DHS conducted an investigation and issued a report finding merit to the allegations of verbal abuse and neglect; although, no action was taken by the State of Oklahoma. DHS also concluded that Wife was sufficiently competent to choose to remain in the marital home. Wife told the DHS caseworkers that she may be having some cognitive problems, but insisted she wanted to remain in the marital residence with Husband. ¶12 Debbie testified that she learned in November of 2017 that Wife was having blackout spells at work. Debbie further testified that while she and her sister were discussing Wife's problems, Wife said that she wanted Debbie and her sister to take care of her. Debbie stated that it was Wife's idea that she and her sister be appointed jointly to serve as Wife's DPOA. 13 Debbie testified that she preferred Christy to serve as Wife's sole guardian. Nevertheless, Debbie wanted Wife to live with her and her boyfriend in Enid. Debbie testified that Husband was emotionally abusive, but admitted he was never physically abusive. To support her assertion of emotional abuse, Debbie pointed to prior statements from Wife, the accidental phone call to Mary, and the argument between herself and Husband regarding Wife's diagnosis. Nevertheless, Debbie admitted that Husband's anger toward her personally might have just been an emotional reaction to the news of Wife's Alzheimer's diagnosis. She testified that she has not been back to the Walterscheidt home since the incident, has had no contact with Husband, and did not know Wife's daily routines. While discussing the confrontation with Wife, Debbie admitted that the group of women grabbed Wife and bruised her arms. She said they were trying to make her listen, but Wife refused. ¶13 Christy testified that she and Husband have never been close, and she made the decision in 2011 to no longer have contact with him. She said that, in 2018, after the death of her brother-in-law, the family got closer again for a time. However, as Wife's condition progressed, Christy's relationship with her family worsened again. She also testified that after filing her objection to the petition for guardianship, her relationship with Wife deteriorated. Christy admitted that she had not been to the Waltersheidt home for close to two years preceding the guardianship case and did not know any of Wife's daily routines. She admitted that she chose not to seek a guardian appointment, until after Husband filed his petition, because she did not want to infringe upon her mother's liberties. When asked whether she could be co-guardian with Husband, she said yes as long as there were some checks and balances in place. Finally, she agreed that it would be beneficial for Wife to continue doing activities that are familiar to her. Additionally, she had no evidence to contradict Wife's testimony that she was happy with her life on the farm. ¶14 On March 2, 2020, Judge Schneiter notified the parties that he was going to appoint Christy as Wife's guardian, although no journal entry was filed at that time. On June 17, 2020, Christy filed a First Amended Plan for Care and Treatment of Ward and Management of Property of the Ward. On July 27, 2020, Judge Schneiter approved the plan, which provided that Debbie would be Wife's primary caregiver and that Wife would live with Debbie and Debbie's boyfriend in Enid. Additionally, visits between Husband and Wife would be only at the discretion of Christy, and visits would be limited to three times a week for one hour. On August 10, 2020, Judge Schneiter issued his three-page order memorializing his decision appointing Christy as guardian over the person and property of Wife. On August 24, 2020, Husband filed a motion requesting the trial court reconsider its final order.14 The trial court denied the motion and Husband initiated the present appeal. On the Court's own motion, this matter was retained. We find no reversible error and affirm the decision of the trial court. Standard of Review ¶15 Appellant raises five assignments of error in this appeal. The issues raised concern both questions of law and fact. Factual disputes relating to the appointment of a guardian are reviewed for an abuse of discretion. In re S.A.H., 2022 OK 10, ¶ 11, 503 P.3d 1190, 1194. Trial courts are assumed to have used sound legal discretion, and their rulings will not be overturned absent an abuse of discretion. Gould v. Smith, 1965 OK 112, ¶ 8, 405 P2d. 82, 85. Further, "we reverse a guardianship order only if it is clearly against the weight of the evidence or contrary to law." In re Guardianship of Berry, 2014 OK 56, ¶ 61, 335 P.3d 779, 799. Of course, questions of law are always subject to this Court's de novo review. Legarde-Bober v. Okla. State Univ., 2016 OK 78, ¶ 5, 378 P.3d 562, 564. In exercising such a review, "this court possesses plenary, independent, and non-deferential authority to examine the issues presented." In re Estate of Foresee, 2020 OK 88, ¶ 8, 475 P.3d 862, 865. Analysis ¶16 Appellant first challenges the trial court's failure to follow the Wife's expressed preference to remain in Husband's care and custody at the family farm. In furtherance of this assertion, Appellant maintains that the trial court abused its discretion and erred as a matter of law by failing to follow Wife's expressed preference in the appointment of her guardian. Title 30 O.S.2011, § 1-103 states: A. It is the purpose of the Oklahoma Guardianship Act to promote the general welfare of all citizens by establishing a system of general and limited guardianships for minors and for incapacitated and partially incapacitated persons which provides for the protection of their rights and the management of their financial resources. B. It is the purpose of the system of general and limited guardianships for incapacitated and partially incapacitated persons established by this act to provide for the participation of such persons, as fully as possible, in the decisions which affect them. It is the intent of the Oklahoma State Legislature: 1. That the court shall exercise the authority conferred by the Oklahoma Guardianship Act so as to encourage the development of maximum self-reliance and independence of the incapacitated or partially incapacitated person and make appointive and other orders only to the extent necessitated by the mental and adaptive limitations or other condition of the incapacitated or partially incapacitated person warranting the procedure; 2. That in performing their duties and exercising their powers, guardians and limited guardians of incapacitated or partially incapacitated persons shall: a. assure, to the extent reasonably possible, that the rights of the wards for whom they are appointed are protected; b. encourage, to the extent reasonably possible, incapacitated or partially incapacitated persons to participate to the maximum extent of their abilities in all decisions which affect them and to act on their own behalf on all matters in which they are able to do so within the limitations imposed by the court; and c. as appropriate, assist their wards to develop or regain to the maximum extent possible their capacity to meet the essential requirements for their health or safety, or to manage their financial resources or both. (Emphasis added).This language illustrates the Legislature's intent that even an incapacitated person should participate "as fully as possible" in making decisions that affect their life. However, the language of the statute also recognizes that full participation by an incapacitated person may not always be possible, or desirable, because of that incapacitated person's mental state or limitations on their ability to adapt. Therefore, the weight to give an incapacitated person's preference is largely discretionary with a trial judge and depends on an individual's capacity to offer a coherent explanation of their wishes. ¶17 This Court has previously set out guidelines for trial judges to consider when evaluating a ward's preference. In In re Guardianship of Holly, 2007 OK 53, 164 P.3d 137, the ward was a partially incapacitated adult who wanted to replace his court appointed attorneys with his own nominated attorneys. The trial court refused to hear evidence of ward's capacity to hire his own attorneys and held that the nominated attorneys would not be allowed to represent Ward. Id. at ¶ 12, 164 P.3d at 141. On review, this Court invoked § 1-103(B) and reiterated that the "purpose of a guardianship is to allow the ward to participate, 'as fully as possible,' in the decisions affecting him." Id. at ¶ 23, 164 P.3d at 144 (quoting 30 O.S.2001, § 1-103(B)). The Holly decision recognized that a ward's right to nominate his or her own counsel was fundamental. Id. at ¶ 24, 164 P.3d at 144. When such a nomination is challenged, a lower court must conduct "a meaningful evidentiary hearing to resolve the dispute." Id. at ¶ 23, 164 P.3d at 144. ¶18 Whether evaluating a ward's preference for appointment of a guardian or their choice of counsel, a trial court must thoroughly consider and settle such choice. When issuing a decree, courts should acknowledge a ward's desires. Although the trial court made no findings regarding Wife's preference to remain with Husband on the family farm,15 the trial court noted in the record on February 20, 2020, that "I know it's been extremely emotional for everyone involved, counsel and even those in the audience, as well for the Court."16 The Court went on to state: I understand the importance of Connie remaining in the home, and I do understand that you all have been in a relationship for 34 years. I also have heard evidence today that there have been problems and whether it's denial, reluctance, or whatever the reason, there have been issues during the time from the diagnosis until today. And I have concerns about going forward about what's in her interest to make sure she's receiving the care she needs going forward.17 When the decree is considered together with the statements in the record, it is reasonable to conclude that the trial court took into account the wife's preference in making his decision. ¶19 The court's order appointing a guardian for Wife concluded she was incapacitated. By statutory definition, an incapacitated person is an impaired individual who lacks the capacity to provide for her own health or physical safety or is incapable of managing her own finances.18 A determination of incapacity does not ,however, automatically foreclose a ward from expressing his or her preference for a particular guardian, or participating in plans relating to his or her prospective care. 30 O.S.2011, § 1-103. ¶20 Medical records suggested that Wife gave conflicting opinions about who she wanted to be her caregiver. In 2017, Dr. Salins recorded a note in Wife's patient file indicating Wife wanted her daughters and her sister to take care of her should she become incapacitated. Later records, however, reflect that Wife told her treating physicians she wanted to remain in Husband's care. Similarly, evidence in the record relating to Wife's competency was conflicting. Medical records indicated Wife was not sufficiently lucid to revoke her DPOA as of April 22, 2019; Dr. Salins indicated that Wife did not know the date, was unaware of the current President, and had a 0/5 recall score. Additionally, during the February 2020 trial in this case, Wife recalled her birthday of October 25, 1963, but estimated she was thirty-three years old. At other times, Wife's testimony appeared to reflect no cognitive deficit. Based on the conflicting record, it is difficult to discern whether Wife was sufficiently capable of participating in and providing input relating to the court's decisions affecting her future care and well-being. ¶21 We recognize and emphasize that the trial court was in a better position to evaluate Wife's demeanor and to assess Wife's abilities than an appellate court merely reading pages in a transcript. Berry and Berry Acquisitions, LLC v. BFN Properties LLC, 2018 OK 27, ¶ 19, 416 P.3d 1061, 1070. Further, we should not reverse an underlying judgment "for error in any matter of pleading or procedure, unless it is the opinion of the reviewing court that the error complained of has probably resulted in a miscarriage of justice, or constitutes a substantial violation of a constitutional or statutory right." 20 O.S.2011, § 3001.1 (emphasis added). Because of the sensitive nature of the relationship between a husband and wife, the trial court should endeavor to provide findings to support deviations from a ward's expressed wishes to remain in a family home with his or her spouse. Nevertheless, we believe there was sufficient evidence in this case to justify the trial court's rejection of Wife's request to remain at home with Husband. Although nothing mandates an exhaustive recitation of the factual findings, the issues should be answered in a manner sufficient to allow a meaningful appellate review. Towne v. Hubbard, 2000 OK 30, ¶ 13, 3 P.3d at 159-60. ¶22 Next, Husband maintains the trial court erred by failing to follow the statutory preferences for appointment of a guardian outlined in the Oklahoma Guardianship and Conservatorship Act.19 In his third assignment of error, Husband alleges that evidence did not support the appointment of Christy Hladik as guardian, and that such appointment was clearly contrary to Wife's best interests. The Appellee does not dispute that the statute sets out a numeric list of individuals by priority, but argues that the trial court may exercise discretion and deviate from the list when taking into account the best interests of the ward. We deal with these two independent issues together. Title 30 O.S.Supp.2019, § 3-104 (A) provides: A. The following priorities shall guide the selection by the court of a guardian or limited guardian of an incapacitated or partially incapacitated person from among those eligible: 1. The individual or individuals nominated by the subject of the proceeding pursuant to Section 3-102 of this title; 2. The current guardian or limited guardian appointed or recognized by the appropriate court of any other jurisdiction in which the incapacitated or partially incapacitated person resides; 3. An individual nominated by the will or by other writing of a deceased parent, spouse, or an adult child who was serving as the guardian or limited guardian of the subject of the proceeding; 4. The spouse of the subject of the proceeding; 5. An adult child of the subject of the proceeding; 6. A parent of the subject of the proceeding; 7. A sibling of the subject of the proceeding; 8. Any individual approved by the court with whom the subject of the proceeding has been living for more than six (6) months prior to the filing of the petition. Provided that any owner, operator, administrator or employee of a facility subject to the provisions of the Nursing Home Care Act, the Residential Home Care Act or the Group Homes for the Developmentally Disabled or Physically Handicapped Persons Act shall not be appointed guardian or limited guardian of a resident of such facility unless the owner, operator, administrator or employee is the spouse of the resident, or a relative of the resident within the second degree of consanguinity and is otherwise eligible for appointment; or 9. If applicable, an individual volunteer qualified for appointment as a guardian of a veteran pursuant to the Veterans Volunteer Guardianship Act. (Emphasis added). ¶23 Generally, the Legislature's use of the word "shall" indicates a statutory proviso is mandatory. Velasco v. Ruiz, 2019 OK 46, ¶ 9, 457 P.3d 1014, 1017-18. Subsection A of § 3-104 sets out a list of persons with priority for consideration by the court for appointment as guardian. The list ranks those with priority from 1 to 9. Although, § 3-104 provides that the priorities "shall guide" the trial court in making a selection for purposes of a guardianship, the use of the word "guide" or "guideline" does not render the term "shall" less obligatory.20 However, this does not end our inquiry, as § 3-104(C) qualifies the mandatory language of subsection A: The court shall make reasonable inquiry to determine whether the person or organization proposed to serve as the guardian or limited guardian of an incapacitated or partially incapacitated person is suitable and will exercise the powers and carry out the duties and responsibilities of guardian or limited guardian in the best interest of the ward. The court shall also inquire of the proposed guardian of the person of the ward as to how the guardian proposes to provide for the care of the ward, and of the proposed guardian of the estate of the ward as to how the guardian proposes to manage the property of the ward and to provide for the ward's financial care. The court shall make such orders with respect thereto as the court deems to be for the best interest of the ward. (Emphasis added). Thus, § 3-104(C) equips a trial judge with discretion to deviate from the priorities in subsection A if a proposed guardian is either (1) unsuitable; or (2) unable or unwilling to exercise guardianship powers and carry out the duties and responsibilities of a guardian in the best interest of a ward. ¶24 To make sense, §§ 3-102 and 3-104 (A) and (C) must be read together as a whole. See Matter of Protest of Raytheon, 2022 OK 32, ¶ 10, --- P.3d --- (recognizing that "statutes regarding the same subject matter are read together, in an effort to give the intended effect to each related provision"). Trial judges should follow the priorities designated in § 3-104(A), unless the court determines there is a justification for denying the appointment of a proposed guardian with precedence. Title 30 O.S.2011, § 3-113(A) directs: A. The order appointing a guardian, based upon evidence adduced, shall set forth: 1. The determinations made by the court at the hearing; 2. The name and address of the individual, if any, appointed to serve as the limited guardian or guardian; 3. The specific limitations imposed upon the ward, if the ward is a partially incapacitated person; 4. Any authority granted a guardian of the person of the ward to change the place of abode of the ward outside of the state or county without the prior permission of the court; and 5. Whenever the court determines a review hearing is necessary or desirable, the date of the review hearing.21 ¶25 Although Wife executed a DPOA, it did not contain a nomination of guardian as authorized by 30 O.S.2011, § 3-102. Likewise, § 3-104(A)(2) and (3) were inapplicable to this case. Yet, the final journal entry makes no mention of the trial judge's resolution of two of the most critical determinations in this case: (1) to disregard Wife's preference; and (2) to appoint Christy instead of Husband. In the case of Towne, ¶ 13, 3 P.3d at 159-60, this Court opined: A constitutionally unassailable guardianship proceeding must therefore include proper written notice, a hearing at which the prospective ward may appear and present evidence, the opportunity to confront and cross-examine adverse witnesses, a neutral decision-maker, representation by counsel, findings meeting a clear and convincing evidence standard, and a record sufficient to permit meaningful appellate review. (footnote omitted & emphasis added).22 Testimony from Husband, Wife, Debbie and Christy indicated that Husband and Wife had verbal altercations throughout the marriage. In addition, Husband demonstrated continued doubt over Wife's diagnosis. Further, Wife and Husband had limited contact with family members. Given the significant stress and work involved in caring for a dementia patient, the trial judge acted within his discretion in bypassing Husband in favor of Christy. There was sufficient evidence to justify the judge's deviation from §3-104. ¶26 In his next assignment of error, Husband challenges the trial court's decision to place Wife in the custody and care of Debbie and her boyfriend and not the appointed guardian.23 Specifically, Husband maintains the trial court failed to conduct a background check on Debbie and her boyfriend as required by 30 O.S.Supp.2016, § 4-105(A). Appellee Christy responds by arguing inter alia that the referenced statute applies to proposed guardians and not to a third-party custodian. Christy further maintains that Husband failed to raise this issue in his motion for new trial and thus the matter is not properly preserved. Contrary to Appellee's assertion, the issue was raised in Husband's motion for new trial. ¶27 First, Husband points to 30 O.S.Supp.2016, § 4-105(A) in support of his argument that the trial court neglected to sufficiently examine the backgrounds of the court-ordered custodians. However, this section concerns the qualifications for an individual seeking to be a guardian. In the present case, Debbie is not the appointed guardian over Wife. Section 4-105 reads as follows: A. In conducting an inquiry to determine whether a person is suitable to serve as a guardian, the court shall determine if: 1. The person proposed to serve as guardian is a minor or an incapacitated or partially incapacitated person; 2. The person proposed to serve as guardian and each adult member of the proposed guardian's household has a record of a criminal conviction, protective order, or pending criminal charge. When requested by the court, the petitioner shall present to the court an Oklahoma State Bureau of Investigation (OSBI) criminal background check for the proposed guardian and any adult household member evidencing no record of a criminal conviction in the OSBI criminal history repository based on the search criteria provided. The petitioner shall disclose the case name and status of any civil or criminal matter in state or federal court involving the proposed guardian or any adult household member of the proposed guardian; 3. The person proposed to serve as guardian is insolvent or has declared bankruptcy during five (5) years prior to the filing of the pleading proposing such person to serve as guardian; 4. The person proposed to serve as guardian is under any financial obligation to the ward; or 5. There exists a conflict of interest which would preclude or be substantially detrimental to the ability of the person to act in the best interest of the subject of the proceeding if such person is appointed. B. No minor or incapacitated person shall be appointed guardian of an incapacitated or partially incapacitated person. C. If the person proposed to serve has a criminal conviction, protective order, pending criminal charge, or other civil or criminal matter in state or federal court, the court shall make further inquiry into the nature of such conviction, order, charge or matter and the surrounding circumstances. The court shall appoint such person proposed to serve only upon determining that the facts underlying the circumstances do not give rise to a reasonable belief that the person proposed to serve will be unfaithful to or neglectful of the fiduciary and care responsibilities of the guardian, and that the appointment is in the best interest of the ward. D. If the person proposed to serve as guardian or limited guardian of the property of an incapacitated or partially incapacitated person is insolvent or has declared bankruptcy within five (5) years prior to the filing of the pleading proposing that such person serve, the court shall appoint such person only after giving due consideration to the nature and extent of the property of the ward and the anticipated actions necessary to manage the estate of the ward, and only upon a determination that such appointment is in the best interest of the ward. Insolvency or bankruptcy shall have no effect on the qualification of a person proposed to serve as guardian or limited guardian of the person of an incapacitated or partially incapacitated person. E. If the person proposed to serve as guardian or limited guardian of the property of an incapacitated or partially incapacitated person is under any financial obligation to the ward, the court shall make further inquiry into the nature and extent of such obligation. The court shall appoint the person proposed to serve only after a determination that such obligation will not impair the ability of the person proposed to serve to discharge the person's fiduciary responsibilities, and that the appointment is in the best interest of the ward. Being under financial obligation to the ward shall have no effect on the qualification of a person proposed to serve as guardian or limited guardian of the person of an incapacitated or partially incapacitated person. F. A current or potential conflict of interest which is not substantial and not likely to preclude or impair the ability of a person proposed to serve as a guardian acting in the best interest of the person's ward shall not, by itself, disqualify such person from appointment. G. Only a person who is a citizen or legal resident of or legally present in the United States of America shall be eligible to be appointed guardian of the property or person of a minor or an incapacitated or partially incapacitated person by the courts of this state, unless the court determines that there are no such qualified individuals available to serve as guardian and that it is in the best interest of the minor or incapacitated or partially incapacitated person to appoint a person without such qualifications. ¶28 This statute presupposes residential placement of a ward with the appointed guardian. Subsection 4-105(A)(2) applies to the adult members of the guardian's household and requires inquiry into any criminal convictions, protective orders, pending criminal charges, and any civil or criminal matters pending in state or federal court. Section 4-105(A) does not mention a third-party not residing in the guardian's household who assumes physical custody of a ward. Regardless, it is prudent for a trial court to conduct an inquiry into person's fitness as a caregiver and the legal qualifications of any proposed third-party custodian.24 The record is silent on whether the trial court conducted a personal background check on Debbie or her boyfriend. However, "legal error may not be presumed in an appellate court from a silent record. Absent a record showing otherwise, this court presumes that the trial court did not err." Hamid v. Sew Original, 1982 OK 46, ¶ 6, 645 P.2d 496, 497. Because Husband has not provided anything in the record to demonstrate the custodians should be disqualified, we find no error in the trial court's approval of the guardianship plan. ¶29 Finally, Husband alleges the trial court erred by failing to hold an evidentiary hearing on the proposed plan. This proposition is without merit. The trial court was statutorily authorized to approve a proposed guardianship plan without conducting an evidentiary hearing. Title 30 O.S.2011, § 3-120 (A) provides: A. If not filed with the petition or submitted to the court at the time of the hearing, within ten (10) days after his appointment the guardian or limited guardian of the person of an incapacitated or partially incapacitated person shall file with the court, for its approval, a proposed plan for the care and treatment of the ward and shall submit subsequent or modified plans as required by this title. Upon the application of the guardian or limited guardian, the court may extend the time for filing the plan for not more than thirty (30) days. The court may approve a plan acceptable to the court without notice or hearing or may, as necessary, order the modification of the plan at the initial review hearing.25 Conclusion ¶30 Due to our aging population, families are increasingly faced with challenging situations, and many will rely on a court to make the most difficult decisions. A thorough record and a carefully explained final journal entry of judgment will assist those concerned in the resolution of the disputes, and will provided for a more effective appellate review. We conclude that the record supports the trial judge's actions and we find no abuse of discretion. The trial court's order appointing Christy Hladik as guardian over Wife's person and property is affirmed. The trial court's approval of the guardian's plan for care and treatment and property management of the Wife is affirmed. TRIAL COURT ORDERS APPOINTING GUARDIAN AND APPROVING GUARDIANSHIP PLAN AFFIRMED Kane, V.C.J., Winchester, Edmondson, Combs, Gurich and Kuehn (by separate writing), JJ., concur; Darby, C.J., (by separate writing), concurs in result; Kauger and Rowe (by separate writing), JJ., dissent. FOOTNOTES 1 Wife was eventually terminated by OBI on December 2, 2017. 2 Records of Dr. Salins dated October 3, 2017, Objector's Exhibit 4, p. 5 of 24. 3 Trans., Feb. 20, 2020, p. 38. 4 Trans., Feb 20, 2020, p. 251-253. 5 DHS Report, Exhibit 8, p. 4 of 47. 6 April 2019 medical records from Sarah Coats, Ph.D., indicate that at the time she conducted her initial evaluation of Wife in December 2017, the examination did not sufficiently focus on Wife's legal competency to execute a power of attorney in the fall/winter of 2017. Thus, she could express no professional opinion as to the validity of the DPOA signed on November 8, 2017; however she did note that Wife "would have certainly been vulnerable to influence." Medical Records of Sarah Coats, PhD dated April 22, 2019, Exhibit 5, p. 9 of 10. Additionally, Wife was determined to be disabled by the Social Security Administration with an onset date of September 15, 2017. 7 Trans., Feb 20, 2020, pp. 230-231. 8 Wife was originally referred to Dr. Coats in December 2017 by Sarah Harmon, PA-C "for assistance with diagnosis and care planning regarding early onset dementia." Medical Records of Sarah Coats, PhD, dated April 22, 2019, Objector's Exhibit 5, p. 1 of 10. 9 Medical Records of Sarah Coats, PhD, dated April 22, 2019, Objector's Exhibit 5, p. 8-9 of 10. 10 Medical Records of Sarah Coats, PhD, dated April 22, 2019, Objector's Exhibit 5, p. 9 of 10. 11 Debbie testified that she felt as though the money was Wife's, only to be used for her personal benefit, rather than payment of marital expenses. Trans., Feb 20, 2020, p. 229. 12 Trans., Feb 20, 2020, p. 23. 13 Trans. February 20, 2020, p. 226. 14 Pursuant to 12 O.S.2011, § 2006(A)(1) and our decision in Christian v. Christian, 2018 OK 91, ¶¶ 7-8, 434 P.3d 941, 943-44, Husband's motion was filed within ten days (excluding weekends) of the appealable order; thus, the time limit to initiate his appeal was tolled until disposition of his post-trial motion. 15 The evidence in the record demonstrated that Wife was, at times, sufficiently lucid to express a desire to remain on the marital farm with Husband. When questioned about her preference, Wife understood where she had lived over the past thirty-four years and she expressed cogent reasons for wanting to remain at home. 16 Trans. February 20, 2020, p. 297. 17 Trans. February 20, 2020, p. 298. 18 30 O.S. 2011 § 1-111(A)(12) provides: "Incapacitated person" means a person eighteen (18) years of age or older: a. who is impaired by reason of: (1) mental illness as defined by Section 1--103 of Title 43A of the Oklahoma Statutes, (2) intellectual or developmental disability as defined by Section 1430.2 of Title 10 of the Oklahoma Statutes, (3) physical illness or disability, (4) drug or alcohol dependency as defined by Section 3--403 of Title 43A of the Oklahoma Statutes, or (5) such other similar cause, and b. whose ability to receive and evaluate information effectively or to make and to communicate responsible decisions is impaired to such an extent that the person: (1) lacks the capacity to meet essential requirements for his physical health or safety, or (2) is unable to manage his financial resources. 19 30 O.S. § 1-101 et seq. 20 In Hill v. American Medical Response, 2018 OK 57, ¶ 1, 423 P.3d 1119, 1123, this court upheld the mandatory use of guidelines established by the American Medical Association for assessing impairment for non-scheduled members set forth in 85A O.S.Supp.2013, §45, referencing the AMA Guides to the Evaluation of Permanent Impairment, Sixth Ed. 21 This statutory section has been amended and, effective November 1, 2021, will require trial judges to issue factual findings relating to a ward's capacity to vote. 22 See also, H.C.S. v. Cmty. Advocacy Project of Alaska, Inc. ex rel. H.L.S., 42 P.3d 1093, 1101 (Alaska 2002) (finding lower court erred by failing to issue specific findings addressing decision to deviate from guardianship priority statute), In re Estate of Runyon, 343 P.3d 1072, 1078-79 (Colo. Ct. App. 2014) (reversing order appointing guardian for failure to enter factual findings regarding ward's preference and deviation from statutory priorities). 23 In the Court's First Amended Plan for Care and Treatment of Ward and Management of Property of the Ward, entered July 27, 2020, the court approved the guardian's request for the Wife to reside with her sister Debbie Gritz. Gritz lives with her retired boyfriend who was not named in the record. Trans. February 20, 2020, p. 296. 24 For example, it would amount to an egregious abuse of discretion to place an adult ward in the physical custody of an individual who had a history of elder abuse. 25 30 O.S.2011, § 3-120 B. 1. The proposed guardianship plan and any subsequent guardianship plans for the care and treatment of the ward shall state: a. the services which are necessary to meet the essential requirements for the physical health or safety of the ward taking into account the contents and recommendations of an evaluation report made with respect to the ward, if any; b. the means for obtaining those services; c. the manner in which the guardian or limited guardian, the ward, and the guardian of the property of the ward or the conservator, or if an organization or another person has been appointed to serve in that capacity, will exercise and share decision-making authority; and d. such other services necessary to assist in fulfilling the needs of the ward, the terms of the most recent dispositional order applying to such guardian or limited guardian, and the duties of such guardian or limited guardian. 2. Each such plan shall be substantially in the following form: Plan for the Care and Treatment of a Ward I, _______________________, the (guardian, limited guardian) for (Name) (Name and the current place of abode of the ward) _________________________________________________ hereby submit this (initial, annual or as ordered by the court) Guardianship Plan for the care and treatment of said ward. 1. I believe the services necessary for the physical health and safety of the ward are: ________________________________________________________________ 2. Those services will be obtained or provided as follows: ________________________________________________________________ 3. The guardian (or conservator) of the property (Name or indicate as not applicable) of the ward, the ward, and I plan to cooperate and share decision-making authority with regard to the ward within the provisions of the dispositional order as follows: ________________________________ 4. I believe the following services will assist in fulfilling the needs of the ward, implementing the terms of the most recent dispositional order applying to me as (guardian or limited guardian): _________________________________________________ Date (Signature of guardian or limited guardian) C. If ordered by the court, the plan for the care and treatment of the ward shall be prepared with the assistance of any person designated by the court to provide such assistance. (emphasis added). KUEHN, J., SPECIALLY CONCURRING: ¶1 Mrs. Walterscheidt is in need of a guardian. That fact is not contested. The limited questions before this Court are (1) whether the trial court erred in its interpretation of the law on how a guardian should be selected, and (2) whether the trial court abused its discretion making that selection. As the Majority notes (Opinion at ¶21), there is no statutory requirement for detailed factual findings on these issues. I believe meaningful appellate review is achievable here, and in the end, so does the Majority. We have a record of the evidence considered by the trial court, and we know the law it was required to follow. ¶2 The trial court did not abuse its discretion by failing to follow Mrs. Walterscheidt's stated desire, at the hearing, that Husband be appointed. The law does not require the trial court to abide by this desire, only to consider it. 30 O.S. § 1-103. We cannot forget the very reason guardianship proceedings were initiated here: Mrs. Walterscheidt's cognitive decline. The weight given to a mentally incapacitated person's preference is discretionary. Opinion at ¶16. As the Majority observes, the trial court was in the best position to evaluate the demeanor of all witnesses. We presume the trial court has done everything proper and necessary to support its judgment unless the contrary affirmatively appears. McFadyen v. Masters, 11 Okla. 16, 66 P. 284, 285 (1901). There is no suggestion that the trial court did not fully and faithfully consider Mrs. Walterscheidt's testimony. ¶3 The law also requires the trial court to consider candidates from a list of prospective guardians. 30 O.S. § 3-104(A). While that list appears to be in order of legislative preference, the law does not require the trial court to explain in detail why it passed over one candidate and chose another one lower on the list. Again, a trial court's decision on this issue is afforded discretion. It could be helpful if the court explained, on the record, the basis for its choice. But the presumption is that the trial court followed the law, and we review the evidence in the record to test that presumption. ¶4 Section 3-104(C) provides that the court "shall make reasonable inquiry" into whether a candidate is suitable. I believe that duty is discharged by allowing the parties to present relevant evidence. There is no statutory requirement that the court justify its reasoning. There is no evidence in this record that the person selected as guardian was unsuitable, or that the proposed living arrangements were unacceptable. Of course, any future concerns about these matters may be addressed to the trial court. ¶5 The guardianship order in this case is neither a protective order nor a divorce decree. It assigns no blame. It does not bar Husband and Wife from enjoying each other's company. It simply places the agency of one person in the care of another. The circumstances of our relationships change over time due to physical and mental infirmity; that is part of life. Guardianship orders are subject to modification as circumstances warrant. I agree that the trial court's decision was not contrary to the clear weight of the evidence, and that it was consistent with the applicable law. Darby, C.J., concurring in result: ¶1 The majority correctly determines the trial court did not abuse its discretion and affirms. The Order Appointing Guardian was not clearly against the weight of the evidence or contrary to law. I remain concerned, however, that the majority opinion may leave readers less than sufficiently informed as to why. ¶2 It is right to review the trial judge's decisions for abuse of discretion. I acknowledge the judge did not adhere to the statutory priority list, did not grant Wife's most recent requests to remain on the family farm with Husband, and did not include findings of fact and conclusions of law in his order explaining in greater detail why he ruled as he did. But a review of the record, not just the Order Appointing Guardian, shows the judge's orders were neither contrary to law nor clearly against the weight of the evidence. The Law ¶3 The trial judge provided as fully as possible for Wife's participation in the decisions affecting her. 30 O.S.2011, § 103(B). The trial judge's selection of a guardian was guided by the priority list in title 30, section 3-104(A), and the judge skipped over Husband in favor of Wife's sister because he determined it to be in the best interest of the ward. The trial judge made reasonable inquiries as required in title 30, section 3-104(C), (which applies to all guardianship appointments regardless of the priority list) and made such orders with respect thereto as he deemed to be for the best interest of the ward. ¶4 The judge's order contained "[t]he determinations made by the court at the hearing" plus other particulars as required in title 30, section 3-113(A)(1). Wife did not nominate a guardian in the form required in title 30, section 3-102, therefore section 3-105 does not apply. The possible errors complained of did not probably result in a miscarriage of justice, or constitute a substantial violation of a constitutional or statutory right. 20 O.S.2011, § 3001.1. The Evidence ¶5 The majority opinion is far too kind to Husband and far too harsh on Wife's daughter and sisters in the rendition of the facts. I cannot join in describing the occasion when the Wife's daughter and sisters were attempting to talk to Wife about the guardianship and held her as "physical violence," a "confrontation," an "episode," or an "altercation." ¶6 The three women were, in my estimation, trying to let Wife know what was going on and allow for her participation. These women, and Husband, have not been physically abusive to Wife. And to characterize what the daughter and sisters did as reflected in the Majority opinion is unfair and inaccurate. ¶7 The record also contains testimony concerning an incident when Husband inadvertently called Mary, who then heard remarks by both Husband and Wife. The majority opinion quotes Wife as saying at the end of the call, "Give me the damn phone." The opinion, however, only states, "Husband used offensive and disparaging language about the parties' daughters, Wife, and Wife's family." I'll say he did. Mary testified that Husband called Wife's family the "f***ing Gibbons" and called his wife of 34 years a "f***ing hag." When Debbie's daughter reported the incident, DHS conducted an investigation and issued a report which concluded among other things, The allegations of caretaker neglect and verbal abuse are substantiated. Self neglect is substantiated as Connie Walterscheidt chooses to stay in her home with Kent Walterscheidt while being subjected to verbal abuse by Kent Walterscheidt. The trial court considered this evidence, and much more, before making the very difficult decision to appoint a guardian for Wife. ¶8 Only a review of the entire record gives this Court the information needed to review for abuse of discretion. And even such a review cannot duplicate the trial judge's in person observations during the trial. ¶9 The trial court followed the law and made decisions which were not clearly against the weight of the evidence. I respectfully concur in result only. ROWE, J., dissenting: ¶1 Today's decision separates a wife from her husband, forces the wife to live with her sister and sister's unidentified boyfriend, and denies the couple the right of companionship -- which is tantamount to a judicially-foisted divorce. "Marriage is a coming together for better or for worse, hopefully enduring, and intimate to the degree of being sacred." Griswold v. Connecticut, 381 U.S. 479, 486, 85 S. Ct. 1678, 1682 (1965). The Oklahoma Legislature recognized the importance of the marital relationship when prioritizing a spouse over an adult child in the appointment of a guardian. ¶2 "Guardianship proceedings are regulated by statute, and failure strictly to comply with the statutory mandate may invalidate the appointment of the guardian." In re Guardianship of Deere, 1985 OK 86, ¶ 5, 708 P.2d 1123, 1125. The majority affirms the trial court's order appointing daughter as general guardian, despite holding that the same order does not comply with 30 O.S.2011 § 3-113(A) as it fails to justify "two of the most critical determinations" the trial court made at the hearing: 1) the reason(s) why the trial court disregarded Wife's preference to remain with Husband in the home; and, 2) the reason(s) why the trial court appointed daughter over Husband contrary to the statute giving Husband priority. ¶3 The order appointing daughter fails to find Husband is unsuitable or unable or unwilling to be appointed -- the sole reasons permitted by 30 O.S.Supp.2019 § 3-104(C) for the trial court to deviate from the statutory priority. The majority concludes that "any departure from these priorities should be explained with adequate factual and legal findings" but then concedes that "the trial court erred by not explaining his departures from the priorities." I would find that the trial court's failure to make these critical determinations is contrary to the guardianship statutes and constitutes an abuse of discretion. ¶4 The majority treats a proposed ward's right to nominate a guardian of her choice as a fundamental right. Like a parent's right of companionship of their children, "marriage is a constitutionally guaranteed fundamental right." Ramey v. Sutton, 2015 OK 79, ¶ 2, 362 P.3d 217, 218. To protect a parent's right of companionship to a child, this Court requires identification of "the precise conditions" in judgments terminating parental rights based on failure to correct the conditions that led to the deprived adjudication. In re T.T.S., 2015 OK 36, ¶ 21, 373 P.3d 1022, 1030. To protect the fundamental marital rights at issue in this guardianship, the same conclusion should be reached about the absence of statutorily-mandated determinations in this trial court order, which effectively separates a wife from her husband of 34 years. ¶5 A guardianship proceeding poses the risk to the prospective ward of a massive curtailment of liberty. Towne v. Hubbard, 2000 OK 30, ¶ 12, 3 P.3d 154, 159. In this instance, the trial court's order effectively deprives Wife and Husband's fundamental right to their marital relationship, a right protected by statutory safeguards. Accordingly, I respectfully dissent.

1260947a-3624-4461-988b-d798163b5358

Coates v. Progressive Direct Ins. Co.

oklahoma

Oklahoma Supreme Court

COATES v. PROGRESSIVE DIRECT INSURANCE CO.2022 OK 45Case Number: 119571Decided: 05/03/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JOHN RANDALL COATES Plaintiff/Appellant, Counter-Appellee, v. PROGRESSIVE DIRECT INSURANCE COMPANY, Defendant/Appellee, Counter-Appellant. Appeal from the District Court of Kay County Honorable Lee Turner, Trial Judge ¶0 John Randall Coates (Plaintiff/Appellant and Counter-Appellee) brought an action for breach of contract and breach of the duty of good faith and fair dealing against Progressive Direct Insurance Company (Defendant/Appellee and Counter-Appellant). A motorcycle collision in which motorcyclist Coates was injured is the basis of the actions. Coates was insured by Progressive under a motorcycle policy, an auto policy, and a policy providing UM coverage. Coates moved for partial summary judgment regarding his entitlement to uninsured/underinsured motorist benefits. Progressive moved for summary judgment regarding Coates' bad faith claim. Coates sought more time to conduct discovery to address Progressive's counterclaim on bad faith. The trial court granted Coates' Motion for Partial Summary Judgment, allowing his UM claim against Progressive. The trial court also granted Progressive's Motion for Summary Judgment, denying Coates' claim for breach of duty of good faith and fair dealing. The trial court denied Coates' Motion for Additional Time to Respond. We retained the appeal. We affirm the District Court's decision granting Coates' Motion for Partial Summary Judgment on the UM claim. We reverse the decisions granting Progressive's Motion for Summary Judgment and denying Coates additional time to respond to that motion. APPEAL PREVIOUSLY RETAINED; ORDER OF THE DISTRICT COURT AFFIRMED IN PART AND REVERSED IN PART Simone Fulmer Gaus, Harrison C. Lujan, Jacob L. Rowe, Andrea R. Rust, FULMER SILL, PLLC, Oklahoma City, Oklahoma, for Plaintiff/Appellant, Counter-Appellee. Brad L. Roberson, Dawn M. Goeres, ROBERSON, KOLKER, COOPER & GOERES, P.C., Edmond, Oklahoma, for Defendant/Appellee, Counter-Appellant. KUEHN, J.: ¶1 This case presents two questions: (1) is Appellee Progressive Direct Insurance Company required to pay Appellant Coates uninsured/underinsured motorist (UM) benefits, and (2) did Appellee breach a duty of good faith and fair dealing in refusing Coates' claim. We answer the first question "yes". We reverse the trial court's order denying time for discovery on the second question, and leave the initial resolution of that question to the trial court. FACTS AND PROCEDURAL HISTORY ¶2 On August 14, 2019, Coates, riding a 1964 Triumph Bonneville motorcycle, suffered serious injuries in a collision with a vehicle driven by Mary Toney. At the time of the crash, Coates was the named insured of two separate policies with Appellee Progressive. Coates insured the Triumph motorcycle with Progressive through Motorcycle Policy No. 9261634. He had, and rejected, the opportunity to purchase additional UM coverage under the Motorcycle Policy. ¶3 Coates also had Automobile Policy No. 927561880 with liability coverage for a Dodge Ram truck. At the time he bought the Auto Policy Coates also bought uninsured/underinsured motorist (UM) coverage for $25,000 for each person and $50,000 each accident. ¶4 After the collision, Coates submitted claims for UM coverage benefits to Progressive under both policies, but quickly agreed that there were no UM benefits connected with his Motorcycle Policy. Progressive rejected Coates' UM claim for coverage bought with the Auto Policy. Progressive claimed that the Auto Policy UM coverage did not apply to the motorcycle collision, because the motorcycle was not specifically included in the Auto Policy. ¶5 Coates filed suit against Progressive for breach of contract and breach of the duty of good faith and fair dealing.1 Coates soon after filed a motion for partial summary judgment regarding his entitlement to UM benefits from Progressive. Progressive filed a motion for summary judgment on both Coates' breach of contract and good faith claims. Coates asked the trial court for more time to respond to Progressive's motion to conduct further discovery. ¶6 A hearing on all motions was held, and during an unrecorded telephone conference, the trial court granted Coates' partial motion for summary judgment. The trial court on a later date, denied Coates' motion for more time to respond, granted Progressive's motion for summary judgment on the issue of good faith and fair dealing and denied any pending motions as moot.2 STANDARD OF REVIEW ¶7 Summary judgment claims turn on the law because there is no material factual dispute. While the trial court necessarily considers the facts in deciding such a claim, the actual question before the court is a pure matter of law. H2K Technologies v. WSP USA, 2021 OK 59, ¶ 6, __ P.3d __. Our review of this legal determination is de novo. Id. COATES IS ENTITLED TO UM BENEFITS UNDER THE AUTO POLICY I. UM Coverage is governed by public policy considerations. ¶8 "When interpreting automobile insurance contracts, the court strives to strike a balance between freedom of contract principles and the state's interest in protecting the public." Ball v. Wilshire Ins. Co., 2009 OK 38, ¶ 27, 221 P.3d 717, 726. We look to see whether a provision "clearly tends to injure public health, morals or confidence in the administration of law, or if it undermines the security of individual rights with respect to either personal liability or private property." Id. ¶9 UM coverage is recommended but not required. However, the Legislature has made it clear that, as a matter of public policy, insurers must offer UM coverage. 36 O.S. § 3636(B) Ch. 1, art. 36, https://govt.westlaw.com/okjc (2021). Insurers must provide UM coverage unless the insured, after being given the opportunity to buy it, affirmatively declines the coverage in writing. 36 O.S. § 3636(G). However, UM coverage is separate and distinct from liability coverage. Lane v. Progressive Northern Ins. Co., 2021 OK 40, ¶ 10, 494 P.3d 345, 349. Insurers must provide UM coverage in order to "protect the insured from the effects of personal injury resulting from an accident with an uninsured/underinsured motorist." Id., ¶ 13, 494 P.3d at 350 (quoting State Farm Auto Ins. Co. v. Greer, 1989 OK 110, ¶ 6, 777 P.2d 941, 942). While one may buy UM coverage at the same time one buys a liability insurance policy, UM coverage does not cover motor vehicles. It covers people. Morris v. America First Ins. Co., 2010 OK 35, ¶ 10, 240 P.3d 661, 663. ¶10 The distinction in the subject of coverage -- vehicle versus person -- is essential. Every driver must carry liability insurance pursuant to 47 O.S. § 7-601, and therefore must buy it. To fully give effect to the Legislature's intention to encourage universal UM coverage, the ability to purchase UM coverage is simple. Under Section 3636, UM coverage must be offered simultaneously with the purchase of a liability policy. 36 O.S.Supp.2014, § 3636(A). But although the liability policy and the UM coverage are bought together, they do not run together. ¶11 As UM coverage is for persons and not specific vehicles, the coverage follows the person. "Follows the person" means that, if an insured person buys UM coverage when the coverage is offered, that UM coverage will apply to accidents and injuries to that person, regardless of whether a specific vehicle involved in an accident was insured under the liability policy bought at the same time. The only circumstance under which UM coverage does not apply is where an insured is injured while occupying a motor vehicle "owned by, or available for the regular use of, an insured, resident spouse, or resident relative", and that motor vehicle "is not insured by a motor vehicle insurance policy." 36 O.S.Supp.2014, § 3636(E). We have interpreted the term "motor vehicle policy" in that exclusion to include a policy for UM coverage. Morris, 2010 OK 35, ¶ 16, 240 P.3d at 664. ¶12 However, that interpretation is not exclusive. The plain language of the statute -- "a motor vehicle insurance policy" -- means what it says. It may include either, or both, liability and UM coverage. Both parties agree that the Triumph was covered by a liability policy. Therefore, since the UM coverage follows the person, and a liability policy was purchased, Progressive must offer some other justification for denying UM coverage. II. Progressive's policy exclusion. ¶13 Progressive argues that Section 3636(E) allows it to deny UM coverage to an insured who purchased UM coverage through another liability policy for another vehicle, regardless of whether the insured has UM coverage through another policy. Progressive argues that since Coates rejected UM coverage under the motorcycle policy, and he was injured while riding the motorcycle, this statutory exclusion applies. This reflects a significant misunderstanding of Section 3636(E). ¶14 Progressive based its denial of Coates' UM claim on exclusionary language it drafted in its Auto Policy under Part III, 1(b), exclusions to UM coverage. That provision states that UM coverage under the policy will not apply: "(1) to bodily injury sustained by any person while using or occupying: (b) a motor vehicle that is owned by or available for the regular use of you, a relative, or a rated resident. This exclusion does not apply: (i) to a covered auto that is insured under this Part III, or (ii) to a relative or rated resident who is insured for uninsured motorist coverage under any other motor vehicle insurance policy he or she has obtained."3 Exclusion 1(b) thus appears to exclude from UM coverage injuries which occur in the insured's own motor vehicle, even though the insured has paid for coverage, unless coverage for that particular vehicle listed in the liability policy was bought at the same time as the UM coverage. Put another way, Progressive has written an exclusion which follows the vehicle, not the person. ¶15 The United States District Court for the Northern District of Oklahoma considered this exclusion in Vickers v. Progressive Northern Insurance Company, 353 F.Supp.3d 1153 (N.D. Okla. 2018). While not binding on this Court, the Vickers general analysis of Exclusion 1(b) is persuasive.4 Vickers correctly emphasizes that, when considering whether a policy exclusion violates Section 3636(E), one controlling factor is whether an insured has had the opportunity to purchase his own UM coverage. Vickers, 353 F.Supp.3d at 1161. In Vickers, the insured was a resident relative driving a vehicle owned and insured for UM coverage by his father; the resident relative himself had no opportunity to purchase UM coverage and was therefore entitled to rely on the doctrine that UM coverage follows the person, not the vehicle. Id. Here, of course, the insured himself both purchased liability and UM coverage from Progressive and made the claim for UM coverage on his UM policy after he was injured in the collision. As per Vickers, UM coverage under Section 3636 is "for the protection of persons insured thereunder." Id. at 1161-62; 36 O.S. § 3636(B). ¶16 People who pay for UM coverage should get what they paid for. Lane, 2021 OK 40, ¶ 20, 494 P.3d at 353; Morris, 2010 OK 35, ¶ 19, 240 P.3d at 664.5 As the trial court remarked, Coates would be entitled to benefits from his UM coverage had he been hit by an underinsured motorist while walking, parked in a parking lot, or sitting on his porch. To find that Coates' UM coverage would apply in those circumstances, but not when he was riding his motorcycle, defies logic, common sense, and the law of Oklahoma. Insofar as Exclusion 1(b) prevents Coates from receiving the benefits he paid for, it violates Oklahoma public policy. III. Conclusion. ¶17 The facts underlying cases involving motor vehicle injuries and UM coverage are as numerous and varied as the number of vehicles and drivers in Oklahoma. Consequently, this Court has been called on to interpret Section 3636 in various complex situations involving drivers, passengers, owners, and multiple insurers. By contrast, Coates bought two liability insurance policies from Progressive, one for a motorcycle and one for a truck. He also bought a UM policy. He is entitled to the benefit of the UM coverage that he bought and paid for. COATES SHOULD HAVE THE OPPORTUNITY TO CONDUCT DISCOVERY ON HIS CLAIM THAT PROGRESSIVE ACTED IN BAD FAITH ¶18 As both parties agree, insurance companies have a duty to deal fairly and in good faith with their insured customers. Coates claimed below that Progressive's decision to deny his UM claim was made in bad faith and asked for time to conduct discovery on this issue. Coates sought discovery of documents and records that might show Progressive's internal decision-making process, specifically including whether Progressive relied on the internal guidelines for Exclusion 1(b) described above in n.3. The trial court denied Coates' request for a continuance to conduct discovery and granted Progressive's motion for summary judgment on the issue of good faith. Coates claims on appeal that both decisions were in error. ¶19 To succeed in bringing a bad faith claim, Coates must show (a) he was entitled to coverage under the insurance policy; (b) Progressive's failure to pay the claim was unreasonable under the circumstances; (c) Progressive did not deal with Coates fairly and in good faith; and (4) Progressive's violation of the duty of good faith and fair dealing was the direct cause of Coates' injury. Ball v. Wilshire Ins. Co., 2009 OK 38, ¶ 21, 221 P.3d 717, 724. In considering a claim that an insurer acted in bad faith, we determine whether the insurer, at the time the claim was made, had a good faith belief that there was a justifiable reason for withholding payment under the policy. Id., ¶ 22, 221 P.3d at 725. The mere fact that an insurer denies or litigates a claim will not show bad faith. Barnes v. Oklahoma Farm Bureau Mut. Ins. Co., 2000 OK 55, ¶ 20, 11 P.3d 162, 170-71. ¶20 Coates essentially argues that the law was clearly on his side, Progressive knew it, and Progressive delayed, rejected, and litigated his claim to avoid paying benefits to which he was entitled. This Court, the Court of Civil Appeals, and various federal courts have in the past reviewed the effect of Section 3636(E) on various aspects of Progressive's Exclusion 1(b). These opinions are often complicated and based on extremely specific facts. While some cases involve Exclusion 1(b), and some involve similar (though not identical) facts, no controlling case had at the time Progressive rejected Coates' claim, resolved this issue. Vickers, 353 F.Supp.3d at 1164; Ball, 2009 OK 38, ¶ 36, 221 P.3d at 730; Barnes, 2000 OK 55, ¶ 32, 11 P.3d at 174. ¶21 However, this does not end our analysis. Coates also argues that, had he had the opportunity for discovery, he might have found evidence that Progressive's particular conduct toward Coates was deliberately made in bad faith. Coates filed his original petition against Progressive in the district court on February 5, 2020, and Progressive filed its motion for summary judgment on June 10, 2020. Coates filed his motion requesting more time to respond to that motion, and to conduct discovery, on July 9, 2020. That is, the case had been at issue for only a few months, subject to COVID-19 pandemic closings and special procedures. No pretrial conferences or other deadlines had been scheduled, there had been no discovery, and the first hearing in the case was held on the day the motion was filed. After the filing of this motion, there were further unavoidable pandemic-related delays in the case, and the next full hearing was on October 8, 2020. It was at this time that the trial court determined that Progressive did not act in bad faith, given the lack of clear guidance from case law, and denied the motion for continuance and discovery as moot. ¶22 This decision was an abuse of discretion. Summary judgment is appropriate where there is no contested issue of material fact. Coates consistently contested the facts surrounding Progressive's summary judgment motion on the bad faith claim. He asked for a reasonable amount of time to conduct discovery to support his argument that Progressive acted in bad faith. Here, the case had been pending for a short period of time. No formal discovery had occurred. As required by both statute and district court rules, Coates' counsel provided an affidavit asking for discovery on particular issues and items directly related to the issue of bad faith. 12 O.S. § 2056(F); Rules of the District Courts of Oklahoma, 12 O.S. Ch. 2 App. R. 13(d). This procedure allows the parties to present enough information for the trial court to intelligently exercise its discretion in granting or denying summary judgment. While there was no controlling case favoring Coates' UM claim, there was enough uncertainty in the case law and, as the trial court ultimately concluded, enough law supporting Coates' position, to warrant inquiry into Progressive's actual decision to deny this claim. ¶23 Without expressing an opinion on the issue of whether Progressive acted in bad faith at the time it denied Coates' claim, we find that the trial court abused its discretion in refusing Coates' request for a continuance to conduct discovery on the issues of good faith and fair dealing. APPEAL PREVIOUSLY RETAINED; ORDER OF THE DISTRICT COURT AFFIRMED IN PART AND REVERSED IN PART. CONCUR: Kauger, Edmondson, Combs, Gurich and Kuehn, JJ. CONCUR IN PART and DISSENT IN PART: Darby, C.J., and Winchester (by separate opinion) and Rowe, JJ. DISSENT: Kane, V.C.J. (by separate opinion) FOOTNOTES 1 Coates' first cause of action was against the driver, Mary Toney. He dismissed all his claims against Toney with prejudice on April 5, 2021. 2 Following the hearing, Progressive stipulated that its evaluation of Coates' injuries resulted in a determination that Coates' damages equaled or exceeded $75,000. While not binding on Toney, this stipulation binds Progressive to a determination that, upon an appellate finding that Progressive must pay Coates UM coverage benefits, Progressive will tender to Coates the $25,000 per-person limit provided by the Auto Policy. A Journal Entry of judgment was filed after all motions were resolved. 3 In 2015, Progressive implemented internal guidelines on the use of Exclusion 1(b). Guideline (a) provided that if the motor vehicle was not a "covered auto" but was owned by or available for regular use of an insured such as Coates, and the motor vehicle is covered by an auto policy providing both liability and UM coverage, Progressive will offer UM coverage. Guideline (b) provided that, under the same circumstances, if the motor vehicle is covered by an auto policy with only liability coverage, Progressive will determine that Exclusion 1(b) bars coverage, but will impute UM coverage equal to the statutory mandatory minimum limits of liability coverage. Finally, Guideline (c) provides that under the same circumstances, if the motor vehicle is not covered by any other auto policy, Exclusion 1(b) will bar all UM coverage. Vickers, 353 F.Supp.3d at 1157. These guidelines appear to focus on the status of the motor vehicle at issue, rather than the status of the person seeking UM coverage. Insofar as Progressive may have relied on this focus in denying Coates UM coverage, this also would reflect a misunderstanding of Section 3636(E). 4 Vickers involved multiple insurance companies and policies, and a driver who was the named insured on some policies but not others. Considering only those particular facts, Vickers concluded that under those circumstances Exclusion 1(b) violated Section 3636(E) and Oklahoma's public policy surrounding UM coverage. This conclusion is not relevant to the issue presented here, and we do not rely on it in our analysis. 5 Progressive has argued that it is somehow unfair to allow Coates to receive benefits from the Auto Policy UM coverage, when he declined to buy the more expensive UM coverage offered specifically with the Motorcycle Policy. As the trial court noted, Progressive writes its policies and controls the terms of the contract. Progressive must comply with the law, including the statutory requirement to provide UM coverage; in doing so, Progressive has the ability to adopt a pricing schedule for UM coverage that takes into account both the law and any perceived economic advantage or disadvantage it might experience from complying with the law. Winchester, J., with whom Rowe, J. joins, concurring in part, dissenting in part: ¶1 I concur with this Court's ruling entitling John Randall Coates (Coates) to uninsured/underinsured motorist (UM) benefits. However, I dissent to the reversal of summary judgment regarding Coates's bad faith claim against Progressive. ¶2 When adopting the tort of bad faith, this Court recognized that because "there can be disagreements between insurer and insured on a variety of matters such as insurable interest, extent of coverage, cause of loss, amount of loss, or breach of policy conditions," the tort does not prevent the insurer from reasonably withholding payment or litigating a legitimate dispute. Christian v. Am. Home Assurance Co., 1977 OK 141, ¶ 26, 577 P.2d 899, 905. Since that time, we have repeatedly upheld that if there is a legitimate dispute concerning coverage or no conclusive precedential legal authority requiring coverage, withholding or delaying payment is not unreasonable or in bad faith. See, e.g., Porter v. Okla. Farm Bureau Ins. Co., 2014 OK 50, 330 P.3d 511; Ball v. Wilshire Ins. Co., 2009 OK 38, 221 P.3d 717; Skinner v. John Deere Ins. Co., 2000 OK 18, 998 P.2d 1219. ¶3 Here, a legitimate dispute existed as to (1) whether Progressive's Exclusion 1(b) applied to Coates's automobile policy UM claim, and (2) whether Coates was entitled to UM benefits under his automobile policy even though he rejected and paid no premium for UM coverage under his motorcycle policy. The majority agrees that there was no controlling case that resolved these issues at the time Progressive rejected Coates's claim. Therefore, Progressive had a "good faith belief . . . that it had a justifiable reason for withholding payment under the policy." Ball, 2009 OK 38, ¶ 22, 221 P.3d at 725. ¶4 With the Court's decision here, it settles this UM issue by expanding coverage. However, Progressive did not act in bad faith at the time it denied Coates's claim. Summary judgment was therefore appropriate on the bad faith claim against Progressive, and the district court did not err in refusing Coates's request for additional discovery. KANE, V.C.J., dissenting: ¶1 Oklahoma law is clear that "[i]f there is a legitimate dispute concerning coverage or no conclusive precedential legal authority requiring coverage, withholding or delaying payment is not unreasonable or in bad faith." Ball v. Wilshire Ins. Co., 2009 OK 38, ¶ 22, 221 P.3d 717, 725.1 See also, Porter v. Okla. Farm Bureau Ins. Co., 2014 OK 50, 330 P.3d 511 (upholding trial court's dismissal of bad faith claim where only Oklahoma law on disputed issue was a Court of Civil Appeals case that did not constitute the law at the time of the insurer's decision); Christian v. Am. Home Assur. Co., 1977 OK 141, ¶ 26, 577 P.2d 899, 905 (recognizing bad faith as a distinct tort for the refusal to settle a claim resting on the insurer's implied duty of good faith and fair dealing, which arises from the contractual relationship between the insurer and the insured); Davis v. Mid-Century Ins. Co., 311 F.3d 1250 (10th Cir. 2002) (reversing trial court's denial of insurer's motion for judgment as a matter of law on appellee's bad faith claim because there was no settled law on the coverage issues presented). ¶2 "The critical question in a bad faith tort claim is whether the insurer had a 'good faith belief, at the time its performance was requested, that it had a justifiable reason for withholding [or delaying] payment under the policy.'" Ball, 2009 OK 38, ¶ 22, at 725 (quoting Buzzard v. McDaniel, 1987 OK 28, ¶ 10, 736 P.2d 157, 159). Under the facts of this case, there are two legitimate disputes: (1) whether Progressive's Exclusion 1(b) applied to Coates' automobile policy UM claim, and (2) whether Coates was entitled to UM benefits under his automobile policy even though he rejected and paid no premium for UM coverage under his motorcycle policy. ¶3 As Justice Winchester points out, the Majority concedes there was no controlling case that resolved these issues at the time Progressive rejected Coates' claim. As a result, Progressive did not act in bad faith at the time it denied Coates' claim. Because Progressive had "a good faith belief, at the time . . . for withholding payment . . . " under the policy, the district court did not err in granting Progressive's Motion for Summary Judgment on Coates' bad faith claim, nor did it err in refusing Coates' request for additional discovery. See Ball, 2009 OK 38, ¶ 22, 221 P.3d at 725. ¶4 I also respectfully dissent with the Majority's conclusion affirming the trial court's ruling entitling Coates to UM benefits. We are called to "strike a balance between freedom of contract principles and the state's interest in protecting the public" when interpreting automobile insurance contracts. Ball, 2009 OK 38, ¶ 27, 221 P.3d at 726. ¶5 In this case, the Majority focuses on "the distinction in the subject coverage" -- i.e., the distinction between liability insurance and UM coverage. See Majority Op. ¶ 10. Certainly, UM coverage is separate and distinct from liability insurance. See Lane v. Progressive Northern Ins. Co., 2021 OK 40, ¶ 10, 494 P.3d 345, 349 (quoting State Farm Auto Ins. Co. v. Greer, 1989 OK 110, ¶ 6, 777 P.2d 941, 942). While it is true every driver must purchase and carry liability insurance pursuant to 47 O.S. § 7-601, the same is not true for UM coverage. Instead, UM coverage is recommended, but not required. See 36 O.S. § 3636(B) Ch. 1, art. 36 (2021). ¶6 When it comes to UM coverage, the Legislature has determined as a matter of public policy that insurers must offer UM coverage simultaneously with the purchase of a liability policy in order to "protect the insured from the effects of personal injury resulting from an accident with an uninsured/underinsured motorist." Lane, 2021 OK 40, ¶ 13, 494 P.3d at 350; see also 36 O.S.Supp.2014 § 3636(A). However, unlike liability insurance, the driver is given an affirmative choice to either: (1) purchase UM coverage thereby lessening his/her potential exposure; or (2) reject UM coverage and take on the additional risk associated therewith. Ultimately, "unlike Oklahoma's compulsory liability insurance law, the UM statute gives an applicant for insurance the right to completely reject UM coverage." Lane, 2021 OK 40, ¶ 7, 494 P.3d at 355 (Rowe, J., dissenting). ¶7 Despite the desirable public policy favoring UM coverage, this Court has consistently upheld UM exclusions as consistent with Oklahoma's UM statute. See id. ¶ 5, at 354-55 (J. Rowe, dissenting); see also, Ball, 2009 OK 38, ¶ 27, 221 P.3d at 726 (setting the standard for determining whether a provision in an insurance contract violates public policy). We also look to the purpose of the uninsured motorist provisions when viewed in light of the requirement that it must provide minimum standards of protection. UM coverage should place the insured in the same position he would have been in had the negligent uninsured motorist complied with Oklahoma laws concerning liability coverage. See Lane, 2021 OK 40, ¶ 5, 494 P.3d at 355 (Rowe, J., dissenting) (citing May v. Nat'l Union Fire Ins. of Pittsburgh, Pa., 1996 OK 52, ¶ 8, 918 P.2d 43, 46). ¶8 In this case, it is undisputed that Coates purchased a motorcycle policy and rejected UM coverage under that motorcycle policy. This simple fact cannot be overlooked. It is key to the entire analysis. Looking back at our case law and the strong public policy in favor of providing UM coverage, we cannot ignore Coates' rejection of UM coverage for the motorcycle policy. It was an affirmative and intentional act -- one that courts look to when considering whether a policy exclusion violates Section 3636(E). See Vickers v. Progressive Northern Ins. Co., 353 F.Supp.3d 1153 (N.D. 2018), Shepard v. Farmers Ins. Co., Inc., 1983 OK 103, 678 P.2d 250, Conner v. Am. Commerce Ins. Co., 2009 OK CIV APP 61, 216 P.3d 850 (court of civil appeals upheld an exclusion based on § 3636(E) where plaintiff was insured under his parents' motor vehicle policy, which included UM coverage, but plaintiff was injured by an underinsured motorist while riding a motorcycle he owned and had insured for liability coverage with another insurance company and for which he had rejected UM coverage). ¶9 In Vickers v. Progressive Northern Insurance Company, 353 F.Supp.3d 1153 (N.D. 2018), the United States District Court for the Northern District of Oklahoma considered the same exclusion in this case [Exclusion 1(b)] and correctly emphasizes that when considering whether a policy exclusion violates Section 3636(E), one controlling factor is whether an insured has had the opportunity to purchase his own UM coverage. Vickers, 353 F.Supp.3d at 1161. In Vickers, the insured was the father and the driver involved in the accident was a resident-relative of the father. Id. Because the driver had no opportunity to purchase UM coverage for himself, the Vickers court held the driver was entitled to UM benefits purchased by the insured (his father) because Section 3636(B) is "for the protection of persons insured thereunder." 36 O.S. § 3636(B); Vickers, 353 F.Supp.3d at 1161-62. ¶10 The Majority cites to Vickers to support its conclusion that Coates is entitled to UM coverage; however, the facts of Vickers do not support this conclusion. Unlike the insured in Vickers who paid for UM coverage, Coates first rejected UM coverage when he purchased his motorcycle policy. The Majority misses this important fact and jumps straight to the conclusion that because Coates eventually "both purchased liability and UM coverage from Progressive and made the claim for UM coverage on his UM policy after he was injured in the collision" he is entitled to UM coverage. See Majority Op. ¶ 15. This is a faulty conclusion based solely on Coates' second policy of insurance with Progressive -- his auto policy wherein he did purchase UM coverage. There is no discussion by the Majority about the cause and effect of Coates' two separate policies of insurance, nor his first rejection of UM coverage with the motorcycle policy, followed by his acceptance of UM coverage with the auto policy at a later date. None of these important facts were present in Vickers. Instead, the Majority expands UM coverage in our State with absolutely no parameters. ¶11 By way of example, the Majority's analysis produces an illogical result in that it allows a driver to purchase an auto policy and reject UM coverage (and not pay for it), but then at a later date purchase a second auto policy that identifies a single automobile and pay for UM coverage, and then go on to claim months or even years later, that the driver has UM coverage for every vehicle the driver owns regardless of whether the automobile is specifically identified in the policy and regardless of the number of vehicles the driver owns. This is true in this example despite the fact that the driver has only paid for UM coverage under one policy of insurance that identifies a single automobile. Progressive refers to this intentional type of behavior as "piggybacking" -- because in this case, although Coates rejected UM coverage under his motorcycle policy with Progressive, he nevertheless seeks UM coverage involving his motorcycle accident under his auto policy because he paid for UM coverage under the auto policy. The auto policy did not identify the motorcycle, thus Coates is attempting to "piggyback" the motorcycle onto the auto policy that had UM coverage. ¶12 This result does not place the insured in the same position as he would have been in if the negligent uninsured motorist had complied with Oklahoma laws concerning financial responsibility. See May, 1996 OK 52, ¶ 8, 918 P.2d at 46. Instead, it gives the insured a loophole to seek UM benefits for which the insured has not paid. For these reasons, I respectfully dissent. FOOTNOTES 1 It is also well settled that "[r]esort to a judicial forum is not per se bad faith or unfair dealing on the part of the insurer regardless of the outcome of the suit." Christian v. Am. Home Assur. Co., 1977 OK 141, ¶ 26, 577 P.2d 889, 905.

379389c3-692d-4dcc-92ef-22a148b7c45e

Tay v. Green

oklahoma

Oklahoma Supreme Court

TAY v. GREEN2022 OK 37Case Number: 119927; Comp. w/119984Decided: 04/19/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA PAUL TAY, Petitioner, v. JED GREEN and KRISTOPHER MASTERMAN, Respondents. ORIGINAL PROCEEDING TO DETERMINE THE CONSTITUTIONAL VALIDITY OF STATE QUESTION NO. 818, INITIATIVE PETITION NO. 432. ¶0 This original proceeding declares a challenge against the legal sufficiency of State Question No. 818, Initiative Petition No. 432. State Question 818, Petition No. 432 seeks to create a new article to the Oklahoma Constitution, Article 31, which would (1) replace the Oklahoma Medical Marijuana Authority with a new state agency--the "Oklahoma State Cannabis Commission" and define its duties; and (2) expand the statutory framework regarding regulation and taxation of medical marijuana. Petitioner, Paul Tay, alleges that State Question No. 818, Petition No. 432 is unconstitutional for three reasons: (1) it is preempted by federal law; (2) signatures gathered on and elections held on tribal land would be invalid; and (3) its gist is insufficient. We hold Petitioner has failed to establish clear or manifest facial unconstitutionality. State Question No. 818, Initiative Petition No. 432 is legally sufficient for submission to Oklahomans for voting. STATE QUESTION NO. 818, INITIATIVE PETITION NO. 432 IS LEGALLY SUFFICIENT. Paul Tay, Tulsa, Oklahoma, pro se Petitioner. Stephen Cale, Cale Law Office, Tulsa, Oklahoma, for Respondents. Gurich, J. Facts & Procedural History ¶1 On October 7, 2021, Respondents, Jed Green and Kristopher Masterman, filed two state questions with the Oklahoma Secretary of State: (1) State Question No. 817, Initiative Petition No. 431 (SQ 817); and (2) State Question No. 818, Initiative Petition No. 432 (SQ 818). SQ 817 proposed creation of a new constitutional article, Article 32, which would legalize, regulate, and tax recreational use of marijuana by adults of age 21 years or older under Oklahoma law.1 SQ 818 proposed creation of a new constitutional article, Article 31, to phase-out the Oklahoma Medical Marijuana Authority (OMMA) and establish the "Oklahoma State Cannabis Commission" (OSCC); define the OSCC's duties; provide for taxation of medical marijuana and medical-marijuana product sales and the exemption of hemp products therefrom; direct OSCC collections and expenditures; regulate licensing; provide personal rights and protections against arrest, disciplinary action, or discrimination based on Article-31 authorized activities; and grant the Legislature authority to amend specific provisions of Article 31.2 ¶2 The Secretary of State published notice of the initiative petition filings on October 13, 2021. Petitioner timely challenged both on October 18, 2021, in accordance with 34 O.S.2021, § 8(B), https://govt.westlaw.com/okjc (follow hyperlink titled "General Provisions"). Between January 14th and February 17th, 2022, Petitioner filed ten motions for summary or declaratory judgment.3 On February 28, 2022, Petitioner filed a notice of intention to appeal and a request for a stay of signature gathering.4 Standard of Review ¶3 Oklahoma citizens "may protest the sufficiency and legality of an initiative petition." In re State Question No. 807, Initiative Petition No. 423, 2020 OK 57, ¶ 11, 468 P.3d 383, 388 (per curiam) (internal citations omitted). Upon protest, the Court must review the petition to ensure its compliance "with the rights and restrictions established by the Oklahoma Constitution, legislative enactments, and this Court's jurisprudence." Id., 468 P.3d at 388 (internal citations omitted). The Court's pre-election review is restricted to determining whether the proposed measure contains "clear or manifest facial constitutional infirmities." Id. ¶ 12, 468 P.3d at 388 (internal citation omitted). The protestant bears the burden of proof. Id., 468 P.3d at 388 (internal citations omitted). Analysis ¶4 Petitioner argues SQ 818 is unconstitutional because its subject matter has been preempted by federal law; signatures gathered in Indian country and elections held in Indian country would be invalid; and SQ 818's gist does not warn of federal criminal consequences.5 We disagree and conclude Petitioner failed to present a clear or manifest showing of unconstitutionality. Federal law does not preempt SQ 818 ¶5 Petitioner claims the following federal statutes and case law preempt and render SQ 818 facially unconstitutional: (1) the Controlled Substances Act (CSA), codified at 21 U.S.C. §§ 801--904; (2) the Racketeer Influenced and Corrupt Organizations Act (RICO), codified at 18 U.S.C. §§ 1961--1968; (3) federal law prohibiting unlicensed money transmitting businesses, codified at 18 U.S.C. § 1960 (2018); and (4) McGirt v. Oklahoma, 591 U.S. __, 140 S. Ct. 2452 (2020). ¶6 Twice, this Court has held that the CSA and RICO do not preempt the proposed measures in SQ 818. See In re State Question 807, 2020 OK 57, ¶¶ 19--40, 468 P.3d at 390--95 (holding that similar proposition, SQ 807, did not violate the supremacy clauses of the Oklahoma or United States Constitution; the CSA does not preempt Oklahoma's power to legalize, tax, and regulate marijuana; and neither legalizing or taxing marijuana sales violates RICO); see also In re State Question No. 813, Initiative Petition No. 429, 2020 OK 79, ¶ 7, 476 P.3d 471, 473 (applying holdings from In re State Question 807 and rejecting Petitioner's recurrent arguments). We apply our prior holdings and again reject Petitioner's repeated arguments. ¶7 The federal law prohibiting unlicensed money transmitting businesses does not preempt SQ 818. 18 U.S.C. § 1960 penalizes "[w]hoever knowingly conducts, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business." The statute references 31 U.S.C. § 5330 (2018 & Supp. 2020), which defines "money transmitting business" as follows: any business other than the United States Postal Service which-- (A) provides check cashing, currency exchange, or money transmitting or remittance services, or issues or redeems money orders, travelers' checks, and other similar instruments or any other person who engages as a business in the transmission of currency, funds, or value that substitutes for currency, including any person who engages as a business in an informal money transfer system or any network of people who engage as a business in facilitating the transfer of money domestically or internationally outside of the conventional financial institutions system; (B) is required to file reports under section 5313; and (C) is not a depository institution (as defined in section 5313(g)). SQ 818 does not concern a money transmitting business and is thus not preempted by §1960. ¶8 Finally, the Supreme Court of the United States' decision in McGirt does not preempt SQ 818. Petitioner attempts to equate violations of the CSA to major crimes governed by the Major Crimes Act and subject to exclusive federal jurisdiction for crimes committed in Indian country. But, the Major Crimes Act does not identify marijuana possession or marijuana use by Indians among the specific offenses subject to exclusive federal jurisdiction, 18 U.S.C. § 1153 (2018), and cannot form the basis for preemption. Signatures and elections in Indian country are valid ¶9 Petitioner claims Article 1, § 3 of the Oklahoma Constitution renders signatures gathered and elections held in Indian country invalid, relying on McGirt. Petitioner is wrong. Article 1, § 3 provides in part: The people inhabiting the State do agree and declare that they forever disclaim all right and title in or to any unappropriated public lands lying within the boundaries thereof, and to all lands lying within said limits owned or held by any Indian, tribe, or nation; and that until the title to any such public land shall have been extinguished by the United States, the same shall be and remain subject to the jurisdiction, disposal, and control of the United States. Okla. Const. art. 1, § 3 (emphasis added). Under Article 1, § 3, Oklahoma has not waived its political or police power over activities occurring in Indian country within its boundaries.6 Currey v. Corp. Comm'n of Okla., 1979 OK 89, ¶ 22, 617 P.2d 177, 180 (internal citation omitted). Further, the portion of Article 1, § 3 regarding jurisdiction "envisions undiminished and not exclusive jurisdiction." Id. ¶ 23, 617 P.2d at 181. McGirt does not disenfranchise Oklahoma citizens residing in Indian country from the right to participate in state elections, which includes the right to sign an initiative petition. Okla. Const. art. 5, § 2; In re State Question No. 807, 2020 OK 57, ¶ 10, 468 P.3d at 387. The gist is legally sufficient ¶10 The gist of SQ 818 follows: The Oklahoma Medical Marijuana Enforcement and Anti-Corruption Act This constitutional amendment: regulates cannabis, hemp, marijuana and plant based medicine; creates a state agency, the Oklahoma State Cannabis Commission; audits the current medical marijuana program; delegates powers to the Governor, Legislature and the Commission; establishes the Commission Board, its membership and meeting requirements, and its relationships with state agencies; has a fiscal impact and pays for itself with taxes on marijuana sales and fees on businesses and individuals; establishes those taxes, licenses, license requirements and fees; directs surplus revenue to pay for education, local and military veterans mental health programs, law enforcement, research, marijuana waste clean-up, and agricultural insurance; provides licensed marijuana businesses with tax deductions, and some hemp businesses with limited tax credits; adapts to federal legalization of marijuana; provides guidelines for consumer protection and establishes individual patient, professional, privacy, employment, medical, parental, student, firearm ownership, state-licensure, and due process rights; provides for judicial review, severability; and becomes effective upon passage with time for implementation. ¶11 Petitioner claims that SQ 818's gist is insufficient and misleading because it does not warn voters of federal criminal consequences for marijuana possession and use. Under 34 O.S.2021, § 3, https://govt.westlaw.com/okjc (follow hyperlink titled "General Provisions"), "[a] simple statement of the gist of the proposition shall be printed on the top margin of each signature sheet." The gist statement "must be brief, descriptive of the effect of the proposition, not deceiving but informative and revealing of the design and purpose of the petition." In re Initiative Petition No. 344, State Question No. 630, 1990 OK 75, ¶ 14, 797 P.2d 326, 330; see also In re State Question No. 820, Initiative Petition No. 434, 2022 OK 30, ¶ 6, __ P.3d __ (declaring the "'gist must present an outline, or rough sketch, of what the initiative petition will accomplish,'" informing prospective signers "of the 'potential effects' so those signers understand the changes that would be made to Oklahoma's statutory code." (internal citations omitted)). We have declared a gist insufficient for excluding important changes to existing state law. See In re Initiative Petition No. 409, State Question No. 785, 2016 OK 51, ¶¶ 6--7, 376 P.3d 250, 253--54 (finding important changes "recognizably absent from the gist" and concluding the gist "does not provide a potential signatory with sufficient information to make an informed decision").7 The gist title informs voters that the proposition regards medical marijuana, and the gist statement briefly and accurately explains the effect of all substantive numbered sections of SQ 818 which will impact Oklahoma medical-marijuana law. We conclude that SQ 818's gist satisfies 34 O.S. § 3's requirements and is legally sufficient. ¶12 Petitioner, Paul Tay, failed to meet his burden in establishing that State Question No. 818 is clearly or manifestly unconstitutional and that the gist of State Question No. 818 is misleading. The Court assumes original jurisdiction and denies Petitioner's challenge to the constitutionality and sufficiency of State Question No. 818. State Question No. 818 is legally sufficient for submission to the people of Oklahoma. DARBY, C.J., KAUGER, WINCHESTER, EDMONDSON, COMBS, AND GURICH, JJ., CONCUR; KANE, V.C.J. DISSENTS (BY SEPARATE WRITING); ROWE, J. CONCURS IN PART; DISSENTS IN PART (BY SEPARATE WRITING), KUEHN, J., CONCURS IN PART; DISSENTS IN PART. FOOTNOTES 1 Respondents withdrew SQ 817 on November 29, 2021, and refiled the updated measure as SQ 819. Petitioner challenges SQ 819 in companion case No. 119,984. Thus, Petitioner's challenge to SQ 817 is moot because it seeks to resolve an issue no longer part of a "lively 'case or controversy.'" State ex rel. Okla. Firefighters Pension & Ret. Sys. v. City of Spencer, 2009 OK 73, ¶ 4, n. 13, 237 P.3d 125, 129 (internal citation omitted). 2 This proceeding is companion to petitioner's similar challenge to State Question No. 819, Initiative Petition No. 433. 3 From January 14, 2021 to January 18, 2021, Petitioner filed eight motions for summary or declaratory judgment based on state elections in Indian country, preemption, logrolling, limitations of medical marijuana licenses under OAC 310: 681-1-3, and interpretation of Article 1, § 3 of the Oklahoma Constitution. Petitioner's amended application for this Court to assume original jurisdiction raises each issue, except logrolling. On February 10, 2022, Petitioner moved for summary or declaratory judgment based on state interests in Indian country; Petitioner had also raised this issue in his amended application. On February 17, 2022, Petitioner moved for summary or declaratory judgment, asking the Court to take judicial notice of federal case law to aid its interpretation of Article 1, § 3 of the Oklahoma Constitution. Petitioner had opportunity to present his claims in this Court. We deny Petitioner's motions which request the same relief as his amended application. To the extent Petitioner raises any new challenge by way of motion, it is untimely under 34 O.S. § 8(B), which provides: It shall be the duty of the Secretary of State to cause to be published, in at least one newspaper of general circulation in the state, a notice of such filing and the apparent sufficiency or insufficiency of the petition, and shall include notice that any citizen or citizens of the state may file a protest as to the constitutionality of the petition, by a written notice to the Supreme Court and to the proponent or proponents filing the petition. Any such protest must be filed within ten (10) business days after publication. A copy of the protest shall be filed with the Secretary of State. 4 We also deny Petitioner's request for a stay. 5 Petitioner also asks the Court to require the OMMA to observe OAC 310: 681-1-3, regarding limitations of medical marijuana licenses, which provides: All medical marijuana licenses and rights granted under Oklahoma law and this Chapter shall only be valid in the State of Oklahoma, excluding any tribal trust or tribal restricted land or federal lands in the state. This issue is not properly before the Court; the current proceeding challenges the constitutionality of SQ 818, not the current medical-marijuana statutory and regulatory framework. 6 Petitioner relies on Article IV of the 1856 Treaty with the Creeks. Because Oklahoma has not waived political or police power over activities within its boundaries, the Court need not construe the treaty. 7 In the case of In Re: State Question 807, Initiative Petition 423, 2020 OK 57, 468 P.3d 383, 393 ¶ 35, we turned away a challenge based on the argument of federal preemption. KANE, V.C.J., dissenting: ¶1 I dissent to any ruling that the legalization of marijuana is within the purview of the State, for the reasons I have previously set forth in In re State Question No. 820, Initiative Petition No. 434, 2022 OK 30, __ P.3d __ (Kane, V.C.J., dissenting). ROWE, J., concurring in part, dissenting in part: ¶1 I concur with the Court's decision to assume original jurisdiction. I must dissent, however, from the Court's holding that State Question No. 818, Initiative Petition No. 432 ("SQ 818") is constitutionally sufficient to submit to the people of Oklahoma for the same reasons I set forth in In re State Question No. 820, Initiative Petition 434, 2022 OK 30. SQ 818 is preempted by federal law and, thus, conflicts with the Oklahoma Constitution. ¶2 The right to an initiative petition is the first power reserved for the people of Oklahoma under Article 5, § 2 of the Oklahoma Constitution.1 Our prior decisions make clear that the right of initiative is precious and warrants zealous protection. In re State Question No. 807, Initiative Petition 423, 2020 OK 57, ¶ 10, 468 P.3d 383, 388-89. The right of initiative, however, is not absolute; any citizen may protest the sufficiency or legality of an initiative petition. Id. ¶ 11, 468 P.3d at 389. When such a protest is made, this Court must review the petition to determine whether it complies with the Oklahoma Constitution, legislative enactments, and our own jurisprudence. Id. ¶3 Article 1, § 1 of the Oklahoma Constitution states, "The State of Oklahoma is an inseparable part of the Federal Union, and the Constitution of the United States is the supreme law of the land." Likewise, the federal Supremacy Clause set out in the second paragraph of Article VI of the United States Constitution states: This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any state to the Contrary notwithstanding. Pursuant to these provisions, when a potential conflict between state and federal law arises, the state law is preempted. In re State Question 807, 2020 OK 57, ¶ 17, 468 P.3d at 390. Federal law has identified three forms of preemption that may arise from federal action: express preemption, field preemption, and conflict preemption. Id. ¶ 17, 468 P.3d at 389. Express preemption occurs when a federal statute includes a provision stating that it displaces state law and defining the extent to which state law is preempted. Field preemption occurs when Congress expresses an intent to occupy an entire field, such that even complementary state regulation in the same area is foreclosed. Finally, conflict preemption occurs when there is an actual conflict between state and federal law. Id. (internal citations omitted). ¶4 The Controlled Substances Act ("CSA"), 21 U.S.C. §§ 801-904, the federal law which governs the use and trafficking of controlled substances, including marijuana, explicitly addresses the issue of federal preemption of state law: No provision of this subchapter shall be construed as indicating an intent on the part of the Congress to occupy the field in which that provision operates, including criminal penalties, to the exclusion of any State law on the same subject matter which would otherwise be within the authority of the State, unless there is a positive conflict between that provision of this subchapter and that State law so that the two cannot consistently stand together. 21 U.S.C. § 903. Section 903 makes clear that the CSA was not intended to occupy the field to exclusion of state law with respect to regulating the use and trafficking of controlled substances. However, Section 903 does provide that the CSA preempts state law in instances where a "positive conflict" arises. ¶5 A "positive conflict" arises either when it is impossible to comply with both federal and state law, or where state law stands as an obstacle to the accomplishment and execution of Congress's full purposes and objectives. See Hillsborough City, Fla. v. Automated Med Labs, Inc., 471 U.S. 707, 713 (1985). Even if the changes proposed in SQ 818 were to become law, it does not appear that compliance with state and federal law would be impossible. SQ 818 does not, for instance, contain any mandates that would require Oklahomans to violate the provisions of the CSA. ¶6 The passage of SQ 818 would, however, clearly present an obstacle to the accomplishment and execution of Congress's full purposes and objections expressed in the CSA. The purpose of the CSA was "to conquer drug abuse and to control the legitimate and illegitimate traffic in controlled substances." Gonzalez v. Raich, 545 U.S. 1, 12 (2005). Marijuana is considered a Schedule I controlled substance under the CSA. 21 C.F.R. § 1308.11(d)(23). It is illegal for any person to manufacture, distribute, or dispense marijuana and also illegal for any person to possess marijuana with the intent to manufacture, distribute, or dispense it. 21 U.S.C. §§ 841(a)(1), 844(a). ¶7 If SQ 818's proposed amendments become law, there will unquestionably be a proliferation in the cultivation, manufacture, distribution, dispensation, and recreational use of marijuana in Oklahoma. These outcomes are hardly hypothetical. With these activities sanctioned and licensed by the State of Oklahoma, it would be virtually impossible for federal law enforcement to accomplish Congress's objective in the CSA to control the production, sale, and use of controlled substances. ¶8 When we confronted this issue in the past, it was asserted that the CSA could not be understood as preempting state laws which legalize trafficking in marijuana because that would mean the CSA violates the anti-commandeering doctrine. See In re State Question 807, 2020 OK 57, 468 P.3d 383. The anti-commandeering doctrine operates as a limit on federal preemption. "We have always understood that even where Congress has the authority under the Constitution to pass laws requiring or prohibiting certain acts, it lacks the power to directly compel the States to require or prohibit those acts." Murphy v. Nat'l Collegiate Athletic Ass'n, 138 S. Ct. 1461, 1477 (2018) (quotation omitted). ¶9 The CSA does not violate the anti-commandeering doctrine by preempting state laws which undermine its purpose and objectives. The CSA contains no direct mandate for the states to adopt drug enforcement regulations which mirror its provisions; the CSA merely prohibits certain conduct on behalf of individuals. Congress anticipated that states would adopt regulatory schemes that are generally complementary to federal law, even if not perfectly consistent with the CSA. Sanctioning activity that is proscribed by federal law, however, is in no sense complementary. ¶10 SQ 818's proposed amendments clearly present a substantial obstacle to Congress's objectives expressed in the CSA to control the production, sale, and use of controlled substances. SQ 818 is preempted by federal law and, thus, fails to comply with the Oklahoma Constitution. Accordingly, I cannot find that it is fit for submission to the people of Oklahoma. FOOTNOTES 1 Article V, § 2 of the Oklahoma Constitution states: The first power reserved by the people is the initiative, and eight per centum of the legal voters shall have the right to propose any legislative measure, and fifteen per centum of the legal voters shall have the right to propose amendments to the Constitution by petition, and every such petition shall include the full text of the measure so proposed. The second power is the referendum, and it may be ordered (except as to laws necessary for the immediate preservation of the public peace, health, or safety), either by petition signed by five per centum of the legal voters or by the Legislature as other bills are enacted. The ratio and per centum of legal voters hereinbefore stated shall be based upon the total number of votes cast at the last general election for the Office of Governor.

bd07a755-ab40-469b-aa34-61f4acea8889

In re: Application of OK Dev. Finance Auth.

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF APPLICATION OF THE OKLA. DEVELOPMENT FINANCE AUTHORITY2022 OK 41Case Number: 120106Decided: 05/03/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE APPLICATION OF THE OKLAHOMA DEVELOPMENT FINANCE AUTHORITY FOR APPROVAL OF NOT TO EXCEED $800,000,000 RATEPAYER-BACKED BONDS (OKLAHOMA GAS AND ELECTRIC COMPANY), SERIES 2022 (FEDERALLY TAXABLE) ORIGINAL ACTION TO APPROVE RATEPAYER-BACKED BONDS ¶0 The Oklahoma Development Finance Authority requested that this Court assume original jurisdiction and approve the issuance of ratepayer-backed bonds pursuant to the February 2021 Regulated Utility Consumer Protection Act, 74 O.S.2021, ch. 110A-1, §§ 9070-9081. The Oklahoma Development Finance Authority seeks to issue bonds to cover the debt incurred by Oklahoma Gas and Electric Company from unprecedented fuel costs during the February 2021 winter weather event. Oklahoma Gas and Electric Company's ratepayers would then fund the bond payments through a monthly charge. The ratepayer-backed bonds would allow customers to pay their utility bills at a lower amount over a longer period of time. Protestors challenged the proposed bonds on several grounds, focusing on the constitutionality of the bonds. We assume original jurisdiction and hold the ratepayer-backed bonds were properly authorized under the Act and are constitutional. ORIGINAL JURISDICTION ASSUMED; PROPOSED BOND ISSUE APPROVED. Jered T. Davidson, The Public Finance Law Group, PLLC, Oklahoma City Oklahoma, for The Oklahoma Development Finance Authority. John Case, Oklahoma City, Oklahoma, Pro Se Opponent. Mike Reynolds, Oklahoma City, Oklahoma, Pro Se Opponent. Porter Davis, Oklahoma City, Oklahoma, Pro Se Opponent. Thomas Austin, Nichols Hills, Oklahoma, Pro Se Opponent. James Pickel, Oklahoma City, Oklahoma, Pro Se Opponent. Gail and Larry Foster, Edmond, Oklahoma, Pro Se Opponents. Deborah Shinn, Oklahoma City, Oklahoma, Pro Se Opponent. Maureen Harvey, Choctaw, Oklahoma, Pro Se Opponent. Clare Auwarter, Oklahoma City, Oklahoma, Pro Se Opponent. Suzanne Broadbent, Oklahoma City, Oklahoma, Pro Se Opponent. Steven Goldman, The Village, Oklahoma, Pro Se Opponent Stephen A. Melsh, Oklahoma City, Oklahoma, Pro Se Opponent. Laura Rice, Oklahoma City, Oklahoma, Pro Se Opponent. Barbara Gallivan, Oklahoma City, Oklahoma, Pro Se Opponent. Roy Diehl, Oklahoma City, Oklahoma, Pro Se Opponent. PER CURIAM: ¶1 The matter before us is an original proceeding brought pursuant to the February 2021 Regulated Utility Consumer Protection Act (Act), specifically 74 O.S.2021, ch. 110A-1, § 9079, https://govt.westlaw.com/okjc (in ch. 110A-1, follow hyperlink titled, "February 2021 Regulated Utility Consumer Protection Act"), which authorized the Oklahoma Development Finance Authority (ODFA) to file an application with this Court seeking approval of ratepayer-backed bonds to finance the recovery of the fuel costs incurred by Oklahoma Gas and Electric Company (OG&E) during the February 2021 weather event. We assume original jurisdiction and approve the bonds. BACKGROUND AND PROCEDURAL HISTORY ¶2 In February 2021, the State of Oklahoma endured record cold temperatures. The severe cold weather resulted in a shortage of the natural gas supply and in turn extraordinary natural gas costs for regulated utilities operating in Oklahoma. The cost of natural gas for the Oklahoma utilities during the two weeks of extreme cold exceeded their entire fuel acquisition cost in 2020. As a result, the Oklahoma Legislature enacted the Act, 74 O.S.2021, ch. 110A-1, §§ 9070-9081, to provide financing options to lower the economic impact on the utility customers. Most Oklahomans could not afford a one-time, cost recovery payment imposed by the utility, and the Legislature provided a new mechanism to spread the fuel cost recovery over a longer period to minimize the financial impact on utility customers. The Act authorized the Oklahoma Corporation Commission (Commission) to approve the recovery of costs through securitization, which is a financial tool creating a property right to revenues collected by a regulated utility from customers under an irrevocable and nonbypassable mechanism. 74 O.S.2021, ch. 110A-1, § 9072(10), https://govt.westlaw.com/okjc. The property right is then sold and used as security for the repayment of the ratepayer-backed bonds. Id. ¶3 The Act is important because OG&E is an investor-owned electric public utility subject to regulatory oversight concerning its retail rates and charges for sales of electricity made within Oklahoma. Unlike a normal corporation, OG&E cannot increase utility rates on its own. Instead, the Commission must approve all rates and fuel costs adjustments. In this case, the Legislature set out the framework for securitization through the Act., but the Commission had to approve any rate increase to recover the fuel costs incurred during the February 2021 weather event. ¶4 The Act sets up a bifurcated process. First, regulated utilities file an application with the Commission to evaluate the "extreme purchase costs, extraordinary costs or both, requested for recovery which may be mitigated through securitization to reduce the utility bill impact on customers." 74 O.S.2021, ch. 110A-1, § 9073(A), https://govt.westlaw.com/okjc. The Commission must determine whether the expenses recoverable from customers were fair, just, reasonable, and prudently incurred. 74 O.S.2021, ch. 110A-1, § 9073, https://govt.westlaw.com/okjc. If the Commission approves the expenses, the Act authorizes the Commission to adopt a financing order allowing the utilities to recover their costs. Second in the process, the Act permits ODFA1 to issue ratepayer-backed bonds. 74 O.S.2021, ch. 110A-1, §§ 9073-9079, https://govt.westlaw.com/okjc. The bonds once issued are repaid by the customers through a nonbypassable mechanism; in this case, a monthly charge on rate-payer's bills that runs with the property. Id. ¶5 On April 1, 2021, OG&E applied with the Commission to determine that the $838 million in fuel costs OG&E incurred during the February 2021 winter storm were prudent. OG&E, the Commission's Public Utility Division, the Oklahoma Attorney General's office, and other large stakeholders (including the American Association of Retired Persons (AARP), Walmart, and Oklahoma Industrial Energy Consumers) entered into settlement negotiations regarding OG&E's application. All the parties, except for AARP and the Attorney General, entered into a Settlement Agreement that found OG&E prudently incurred costs during the winter storm amounting to $739 million.2 ¶6 In October 2021, an Administrative Law Judge (ALJ) for the Commission held a hearing on the Settlement Agreement, wherein all parties presented evidence either in support or against the Agreement. However, all parties agreed that securitization was the most appropriate method for OG&E to finance the recovery costs. The ALJ issued a report approving the Settlement Agreement.3 ¶7 The Commission then held a hearing regarding the ALJ's report and issued the Final Financing Order on December 16, 2021. The Order approved $739 million in costs incurred by OG&E to be collected through securitization of that debt. The Order specified that ODFA would purchase the debt through issuing bonds backed by a monthly charge (WES charge) assessed to each OG&E ratepayer. The securities were to be amortized for a longer period of time (not to exceed 28 years) to lower the ratepayer collection cost. Under the securitization method, the monthly WES charge was estimated to be $2.12 for an average residential customer.4 The final amount to be secured (including financing and securitization costs) was estimated to total $760 million. Id.5 No party appealed the Final Financing Order. ¶8 ODFA filed an application with this Court to assume original jurisdiction for approval of the ratepayer-backed bonds, per the provisions of 74 O.S.2021, ch. 110A-1, § 9079, https://govt.westlaw.com/okjc. Fifteen Protestants filed in response to the application and challenge the bonds on several grounds but focus primarily on the constitutionality of the bonds. The questions before this Court are (1) whether the ratepayer-backed bonds were properly authorized under the Act and (2) whether the bonds are constitutional. We answer both in the affirmative. The authorization of the ratepayer-backed bonds properly followed the Act, and the bonds are self-liquidating and therefore constitutional. STANDARD OF REVIEW ¶9 The Court has long recognized that its obligation in reviewing bonds is to determine whether the bonds facially violate the law and to examine the legal authority presented by protestants. In re Application of Okla. Turnpike Auth., 2018 OK 88, ¶ 5, 431 P.3d 59, 60-1. Protestants' legal arguments center mainly on the constitutionality of the bonds. A heavy burden is placed on those challenging a legislative enactment, and every presumption is to be indulged in favor of the constitutionality of a statute. In re Application of Okla. Capitol Improvement Auth., 1998 OK 25, ¶ 8, 958 P.2d 759, 763. If two possible interpretations of a statute are possible, only one of which would render it unconstitutional, a court is bound to give the statute an interpretation that will render it constitutional unless constitutional infirmity is shown beyond a reasonable doubt. Fent v. Okla. Capitol Improvement Auth., 1999 OK 64, ¶ 3, 984 P.2d 200, 204. DISCUSSION ¶10 The Legislature conferred upon the Court "exclusive original jurisdiction" to hear and determine ODFA's application. 74 O.S.2021, ch. 110A-1, § 9079, https://govt.westlaw.com/okjc. ODFA gave proper notice of its application and the hearing as required by § 9079, as attested by its proof of publication filed with the Court. Id. The Court's exclusive original jurisdiction entails: If the Court shall be satisfied that the bonds or any portions thereof have been properly authorized in accordance with this act and the Constitution of the State of Oklahoma, and that when issued they will constitute valid obligations in accordance with their terms, the Court shall render its written opinion approving the ratepayer-backed bonds and shall fix the time within which a petition for rehearing may be filed. The decision of the Court shall be a judicial determination of the validity of the bonds, shall be conclusive as to the Authority, the state, its officers, agents and instrumentalities, and all other persons, and thereafter the bonds so approved and the revenues pledged to their payment shall be incontestable in any court in this state. 74 O.S.2021, ch. 110A-1, § 9079, https://govt.westlaw.com/okjc. ¶11 The Legislature enacted this Act to provide for the issuance of ratepayer-backed bonds to regulated entities like OG&E to allow those entities to recover the fuel costs incurred in the February 2021 weather event passed to their customers and thereby to allow customers to pay those costs at a lower amount over a longer period. 74 O.S.2021, ch. 110A-1, § 9071, https://govt.westlaw.com/okjc. Prior to the Act, OG&E had two options for passing the fuel costs to their customers: (1) recoup the cost over the remaining balance of the current year through its current fuel cost adjustment rider, or (2) create a regulatory asset, subject to the same cost of capital analysis as its standard tariff rates. See Oklahoma Gas and Electric Company (Estimate Comparisons), supra note 4. Securitization approved by the Act and the Commission provided a middle ground, allowing the payment of fuel costs over a longer period but at a lower cost of capital than traditional utility financing. Although this is the first time the Legislature allowed the use of securitization for bonds, the method permitted ODFA to access municipal bond markets (with lower interest rates) instead of the regulated utilities' normal bond markets. In turn, securitization will provide OG&E's customers with the lowest monthly payment. Id. ¶12 Here, the ratepayer-backed bonds conform to the law, and the Final Financing Order sets out the parameters of the bonds' issuance, terms, conditions, requirements, and interest. 74 O.S.2021, ch. 110A-1, § 9074(A), https://govt.westlaw.com/okjc. The process set out in the Act was followed, and the bonds appear facially valid. Protestants provide no authority to the contrary, nor do Protestants even allege that the statutory process was not followed here. ¶13 Instead, many Protestants raise issues with securitization itself and question what entities are profiting from the bonds (in carrying and servicing costs). However, it is "firmly recognized that it is not the place of this Court, or any court, to concern itself with a statute's propriety, desirability, wisdom, or its practicality as a working proposition." Fent, 1999 OK 64, ¶ 4, 984 P.2d at 204; Okla. Indus. Auth. v. Barnes, 1988 OK 98, ¶ 14, 769 P.2d 115, 119 (holding this Court is not authorized to delve into the wisdom, need, or desirability of a valid, constitutional legislative enactment). And the Legislature "has the right and responsibility to declare Oklahoma's fiscal policy." Fent, 1999 OK 64, ¶ 5, 984 P.2d at 204. We have held: It is not this Court's prerogative to question the sagacity of the expressed policy. Whether an act is wise or unwise, whether it is based on sound economic theory or whether it is the best means to achieve the desired result are matters for legislative determination. In re Application of Okla. Capitol Improvement, 1998 OK 25, ¶ 9, 958 P.2d at 763. The use of securitization of bonds to recoup the costs for the 2021 February weather event was a legislative fiscal policy decision. This Court may not--based on its perception of how the State should conduct its business dealings--direct legislative decision-making. Id. Instead, the Court is to determine whether the authorization of the bonds followed the statutory process, and we hold the process to authorize the ratepayer-backed bonds was correctly followed. ¶14 Protestants further contend that the bonds are unconstitutional, in violation of Oklahoma's balanced budget amendments, Oklahoma Constitution Article X, § 236 and § 25.7 We reject this argument. In construing constitutional debt-limitation provisions, we have held the judiciary's duty is to guard against indebtedness, not against modern methods of financing. In re Application of Okla. Capitol Improvement, 1998 OK 25, ¶ 9, 958 P.2d at 763. And the Court has long excepted bonds from indebtedness as defined by those amendments. ¶15 This Court has approved bonds that financed the acquisition or construction of self-liquidating projects. That kind of obligation did not create a debt because the bonds issued were retired solely from revenues derived from the project itself.8 The issue decided by this Court on multiple occasions was whether a project could generate any tangible revenue of its own. In many cases, we approved bonds as self-liquidating even when repayment was dependent on annual legislative appropriations. Fent, 1999 OK 64, ¶ 10, 984 P.2d at 208. Contrasted with that revenue-generating standard, the proposal here is far superior. This case is more akin to In re Application of Oklahoma Turnpike Authority, 1950 OK 208, ¶ 48, 221 P.2d 795, 807, wherein we approved bonds to build a toll road. The bonds in that case were to be retired solely from user fees--the tolls paid by travelers using the turnpike. Id. Here, the ratepayer-backed bonds will be repaid with a secure revenue source, through a WES charge on each ratepayer's monthly bill. The money to directly pay the bonds is reliable, predictable fees from "outside" sources--rather than from one state entity to the other. ¶16 Even more, the Act specifically provides that the ratepayer-backed bonds shall not at any time be deemed to constitute a debt of the State or ODFA, and it requires that the bonds contain on their face a statement that neither the full faith and credit nor the taxing power of the state is pledged for the payment of the principal and interest of the bonds. See In re Application of Okla. Capitol Improvement Auth., 1998 OK 25, ¶ 56, 958 P.2d 759, 775-76. We hold that the proposed bonds involve traditional, self-liquidating bonds historically upheld by this Court's jurisprudence; stare decisis demands their approval. Id. ¶¶ 45-46, 958 P.2d at 773. ¶17 Protestants also raise issues involving the examination of the Commission's Final Financing Order. The Act provided that the Commission's financing order is appealable. 74 O.S.2021, ch. 110A-1, § 9074(F), https://govt.westlaw.com/okjc. Yet no party appealed. The record regarding the approval of the Final Financing Order is not before the Court, and the financing order is therefore final. See State ex rel. Comm'rs Land Office v. Corp. Comm'n, 1979 OK 16, 590 P.2d 674. CONCLUSION ¶18 The February 2021 Regulated Utility Consumer Protection Act provides that if the Court is satisfied that the obligations have been properly authorized in accordance with the Act and the Oklahoma Constitution and the bonds constitute valid obligations in accordance with their terms, the Court shall render its written opinion approving the ratepayer-backed bonds. 74 O.S.2021, ch. 110A-1, § 9079, https://govt.westlaw.com/okjc. Accordingly, we approve the ratepayer-backed bonds. Any petition for rehearing regarding this matter shall be filed within twenty (20) days of the date of this opinion. ORIGINAL JURISDICTION ASSUMED; PROPOSED BOND ISSUE APPROVED. Darby, C.J., Kane, V.C.J., Kauger, Winchester, Edmondson, Combs (by separate writing), Gurich, and Rowe (by separate writing), J.J., concur. Kane, V.C.J., concurring: "While the bonds are facially valid, I write separately to reemphasize that this Court is not authorized to delve into the fiscal policy choices of the Legislature." Kuehn, J., recused. FOOTNOTES 1 ODFA is a public trust that the Legislature has authorized to issue bonds and enter into contractual obligations with corporations to repay bonds. 74 O.S.2021, ch. 70, § 5062.8(9), (18), https://govt.westlaw.com/okjc (in ch. 70, follow hyperlink titled, "Oklahoma Development Finance Authority Act"). 2 Although the Attorney General did not execute the Settlement Agreement, the Attorney General consistently supported the usage of securitization throughout the entirety of this matter. The Attorney General's position regarding securitization is found in his Notice of Non-Intervention filed in this case. 3 AARP was the only party to submit Exceptions to the Report and Recommendation of the Commission's ALJ. 4 Oklahoma Gas and Electric Company (Estimate Comparisons) Description of Issue FCA*(w/o Reg. Asset**) FCA Recovery Tariff*** 10-Year Treasury Rate Traditional Securitization Amortization Period 1 month 1 year 4 years 28 years 28 years Interest Rate 0.12% 0.12% 1.44% 9.017% (WACC****) 2.58% Principal Amount Owed $748,965,481 $748,965,481 $748,965,481 $748,965,481 $760,000,000 Total Interest Accrued $74,897 $486,917 $22,195,277 $1,317,908,420 $307,259,833 Total Amount $749,040,378 $749,452,398 $771,160,758 $2,066,873,901 $1,067,259,833 Monthly Impact to Customer $454.14 (one-time payment) $40.14 $10.32 $3.95 $2.12 * FCA = Fuel Cost Adjustment ** Regulatory Asset = A holding place from storm costs, which are carried on the utility's books (Carrying charge is .628%). *** FCA Recovery Tariff = When the over-or-under collected fuel balance is greater than $50 Million, OG&E can make an adjustment to collect or credit the difference between the fuel cost collected in the tariffs and the actual fuel expense incurred. **** WACC = Weighted Average Cost of Capital See Oklahoma Corporation Commission, Media Advisory, Commission Approves order on OG&E's February Fuel Costs, December 16, 2021, available at https://content.govdelivery.com/attachments/OKOCC/2021/12/16/file_attachments/2025304/2021-12-16-occ-media-advisory-oge-february-fuel-costs.pdf. 5 ODFA is seeking an amount not to exceed $800,000,000. ODFA represents that the total amount is still not yet determined as final carrying costs cannot be determined until the securitization process through the sale of the bonds is final. Per the Act, approval of the bonds by this Court is required prior to the sale of the bonds. 6 Section 23 provides: The state shall never create or authorize the creation of any debt or obligation, or fund or pay any deficit, against the state, or any department, institution or agency thereof, regardless of its form or the source of money from which it is to be paid, except as may be provided in this section and in Sections 24 and 25 of Article X of the Constitution of the State of Oklahoma. 7 Section 25 provides: Except the debts specified in sections twenty-three and twenty-four of this article, no debts shall be hereafter contracted by or on behalf of this State, unless such debt shall be authorized by law for some work or object, to be distinctly specified therein; and such law shall impose and provide for the collection of a direct annual tax to pay, and sufficient to pay, the interest on such debt as it falls due, and also to pay and discharge the principal of such debt within twenty-five years from the time of the contracting thereof. No such law shall take effect until it shall, at a general election, have been submitted to the people and have received a majority of all the votes cast for and against it at such election. On the final passage of such bill in either House of the Legislature, the question shall be taken by yeas and nays, to be duly entered on the journals thereof, and shall be: "Shall this bill pass, and ought the same to receive the sanction of the people? 8 See, e.g., In re Application of Okla. Turnpike Auth., 2018 OK 88, 431 P.3d 59; In re Application of Okla. Dev. Fin. Auth., 2013 OK 74, 213 P.3d 926 (bonds to build various projects); In re Application of Okla. Dev. Fin. Auth., 2004 OK 26, 89 P.3d 1075 (bonds to pay or reimburse a tire corporation for a portion of the costs of expanding and re-tooling its existing Oklahoma manufacturing plants); Fent, 1999 OK 64, 984 P.2d 200 (bonds to fund various governmental projects); In re Application of Okla. Capitol Improvement Auth., 1998 OK 25, 958 P.2d 759 (bonds to fund highways); In re Application of Okla. Capitol Improvement Auth., 1966 OK 6, 410 P.2d 46 (building bonds to be retired from rents paid by space lessees); Application of Okla. Capitol Improvement Auth., 1960 OK 207, 355 P.2d 1028 (office building bonds to be retired from rents paid by office renters); In re Application of Okla. Turnpike Auth., 1950 OK 208, 221 P.2d 795 (toll road bonds to be retired from tolls and fees paid by motorist users); In re Application of Bd. of Regents for Okla. Agric. & Mech. Colls., 1946 OK 110, 167 P.2d 883 (dormitory bonds to be retired from rents and fees paid by student users); In re Application of Bd. of Regents of Univ. of Okla., 1945 OK 224, 161 P.2d 447 (dormitory bonds to be retired from rents and fees paid by student users); Baker v. Carter, 1933 OK 484, 25 P.2d 747 (dormitory bonds to be retired from rents and fees paid by student users). COMBS, J., with whom GURICH, J., joins, concurring specially: ¶1 I concur in this Court's limited judgment that "[t]he process set out in the [February 2021 Regulated Utility Consumer Protection] Act[, 74 O.S.2021, §§ 9070--9081,] was followed, and the bonds appear facially valid" and that these self-liquidating, ratepayer-backed bonds do not violate the debt-limitation provisions found in Article X, sections 23 and 25 of the Oklahoma Constitution. Majority Op. ¶¶ 12, 14--16. I write separately, however, to express my frustrations and concerns about the Act's limitations on our review process and the Attorney General's lack of meaningful participation at all stages of this rate-related proceeding. ¶2 In section 9079 of the Act, the Legislature conferred "exclusive original jurisdiction" upon this Court to "hear and determine" the Oklahoma Development Finance Authority's "application . . . for the approval of ratepayer-backed bonds issued under this [A]ct" and to "consider and pass upon the application and any protests which may be filed against such application as speedily as possible." 74 O.S.2021, § 9079, https://govt.westlaw.com/okjc. Section 9079 provides additional details regarding this review of the bonds, stating that a "written opinion approving the ratepayer-backed bonds" shall be rendered so long as "the Court shall be satisfied that the bonds or any portions thereof have been properly authorized in accordance with this [A]ct and the Constitution of the State of Oklahoma, and that when issued they will constitute valid obligations in accordance with their terms." Id. (emphasis added). But the Act fails to shed further light on what the phrase "properly authorized in accordance with this [A]ct" means. ¶3 For instance, should this Court's inquiry into proper authorization consider whether the Oklahoma Corporation Commission properly "determine[d] that the amounts [of extreme purchase costs and extraordinary costs] incurred would otherwise be recoverable from customers as fair, just and reasonable expenses and prudently incurred"? See id. § 9073(E). Our opinion suggests such considerations should not be entertained unless the Corporation Commission's financing order is appealed--something which appears to be permitted under section 9074(F) of the Act,1 albeit in rather equivocal terms--and that our review of the ODFA's application for approval of the bonds should be limited to "whether the authorization of the bonds followed the statutory process." See Majority Op. ¶¶ 13, 17. That certainly is one interpretation--perhaps the best interpretation--of the language in section 9079. Yet the numerous Protestants in this matter urge us to interpret the language of section 9079 more expansively so that we can consider (among other "merits" issues) whether the extraordinary costs associated with the extreme cold in February of 2021 were fair, just, reasonable, and prudently incurred. ¶4 I am somewhat troubled by our opinion's outright dismissal of Protestants' arguments on the basis that they should have filed an appeal to present or to preserve such arguments. My frustrations stem from the ODFA attorney's revelation at the referee's hearing in this matter that OG&E would have asked any Protestant filing an appeal to post a $760,000,000 supersedeas bond pursuant to Section 21 of Article IX of the Oklahoma Constitution.2 Despite this Court's power to review and vacate such bonds, see supra note 2, the prospect of having to post a nearly billion-dollar bond has a chilling effect on anyone deciding whether to file an appeal. Thus, for all practical purposes, this Court has been prevented from reaching the bulk of Protestants' arguments even though the language of section 9079 arguably doesn't stand in our way. I suppose my complaint ultimately lies with the Legislature. If it wanted to limit our review under section 9079 to be so perfunctory, the Legislature could have been more explicit in the language it enacted. ¶5 Of more grave concern to me, however, is the Attorney General's abdication of his duties to OG&E's consumers in this action. The Attorney General has a statutory duty "as the chief law officer of the state . . . [t]o represent and protect the collective interests of all utility consumers of this state in rate-related proceedings before the Corporation Commission." 74 O.S.2021, § 18b(A)(21), https://govt.westlaw.com/okjc. Yet he shirked this duty both in this proceeding and that below. ¶6 While the case was pending before the ALJ and the Commission, the Attorney General chose not to take any position on the Settlement Agreement reached between OG&E and several of its largest consumers (e.g., Walmart and OIEC). In that Settlement Agreement, OG&E agreed to decrease the amount of extraordinary costs it would seek to recover by $99 million in exchange for a concession from the large stakeholders that such compromised amount was just, fair, reasonable, and prudently incurred. The Attorney General neither subscribed to the Settlement Agreement nor joined the other nonsignatory, the AARP, in submitting exceptions to the ALJ's Report and Recommendation approving the Settlement Agreement. See Majority Op. ¶¶ 5--6 & nn.2--3. Thus, he never took any position on what amount of OG&E's extraordinary costs were fair, just, reasonable, or prudently incurred. He also failed to litigate other legitimate points raised by Protestants. Rather, he chose to support securitization in the abstract, contending that securitization of any amount would save OG&E's consumers money. Had he litigated the amount of OG&E's extraordinary costs, he would have likely saved those consumers even more money and, better yet, would have engaged the adversarial process so as to reach a more just result. ¶7 The Attorney General's desire not to press those issues before the Corporation Commission naturally translated into his failure to file an appeal with this Court. Of all people, the Attorney General would have been the best party to file such an appeal, particularly insofar as he arguably doesn't have to post the nearly billion-dollar supersedeas bond that other Protestants would. See 12 O.S.2021, § 66(A), https://govt.westlaw.com/okjc ("Whenever an action is filed in any of the courts of this state where the State of Oklahoma or any of its departments or agencies, as defined in Section 152 of Title 51 of the Oklahoma Statutes, is a party, no bonds or other obligation of security shall be required from the state or from any party acting under the direction of the state, either to prosecute, answer, or appeal the action."). The Attorney General's failure to file an appeal is ultimately what prevents this Court from reaching the merits issues raised by Protestants. ¶8 After the ODFA initiated this original action by filing its application for the approval of bonds in December of 2021, the Attorney General did not file any appearance within the first two months. So this Court gave him an opportunity to intervene and asked for his response by no later than March 1, 2022. See Order 1, Feb. 16, 2022. On that date, the Attorney General filed a Notice of Non-Intervention, indicating his belief that he had already fulfilled his statutory duty to represent the utility consumers in rate-related proceedings before the Corporation Commission and that counsel for the ODFA had adequately briefed the issues in this bond-related proceeding. See Notice of Non-Intervention of Att'y Gen. 1--2, Mar. 1, 2022. Consequently, he "ha[d] nothing substantial to add" and did not want to delay these proceedings further because of his concerns that interest rates on the bonds are likely to increase. Id. ¶9 The utility consumers that the Attorney General should be representing have effectively been left without representation. Their access to counsel lies with the Attorney General. Yet he has failed them. The lack of meaningful participation at the settlement stage, the failure to file an appeal of the Corporation Commission's financing order, and the decision not to intervene in this proceeding leaves this Court with no input from the utility consumers' statutorily appointed counsel and with few options when it comes to reviewing the ODFA's application to approve the bonds. Thus, despite my reservations, the record before us leads me to concur in the limited holdings contained in our opinion. FOOTNOTES 1 74 O.S.2021, § 9074(F), https://govt.westlaw.com/okjc ("A financing order shall not be subject to any form of rehearing after thirty (30) days from the issuance of the order, subject to appeals pursuant to Section 20 of Article IX of the Oklahoma Constitution."). See generally Okla. Const. art. IX, § 20 (discussing the general rule for appeals from the Corporation Commission); Okla. Admin. Code § 165:5-17-1 (discussing the general rule for post-order relief--i.e., motions for rehearing--and setting a 10-day deadline for the filing of such motions but otherwise failing to specify any hard deadline for concluding the hearing on such motions). 2 Okla. Const. art. IX, § 21 ("Upon the giving of notice of appeal from an order of the Corporation Commission, the Commission, if requested, shall suspend the effectiveness of the order complained of until the final disposition of the order appealed, and fix the amount of suspending or supersedeas bond. Such suspending or supersedeas bond shall be approved and filed with the Corporation Commission (or approved, on review, by the Supreme Court), and made payable to the State of Oklahoma . . . ."). ROWE, J., with whom GURICH, J., joins, concurring: ¶1 I concur in the Court's judgment insofar as I do not recognize any clear constitutional or legal infirmities in Petitioner's application. I write separately to address once more a number of concerns I have with the nature of these proceedings. This is now the second time in a matter of weeks that this Court has been prompted by virtue of legislative enactments to preemptively "approve" the issuance of hundreds of millions of dollars in government-backed bonds, comprising debts that will be born in whole by the people of Oklahoma.1 The law in question here, the February 2021 Regulated Utility Consumer Protection Act, also narrowly circumscribes our authority in approving the bonds.2 Despite the limited scope of our review, our approval of the bonds in question will permanently foreclose the right of any person or entity to challenge the validity of these bonds in the future, even if a meritorious claim arises.3 ¶2 This is particularly troubling in light of legitimate questions raised by the Protestors in this matter. From a procedural standpoint, Protestor Porter H. Davis takes issue with the Attorney General's Notice of Non-Intervention, noting that the Attorney General has an obligation to "appear for the state and defend all actions and proceedings..." 74 O.S. § 18b(A)(1). Davis claims that by declining to weigh in on these matters, the Attorney General has not only failed to represent the interests of ratepayers but also inadvertently advanced the interests of parties adverse to ratepayers. On a more substantive note, Protestor Thomas S. Austin questions the reasonableness of ODFA's proposed rate-payer backed bonds in light of financing plans secured by other public utilities in Oklahoma. In particular, he references the plan put forward by the Canadian Valley Electric Cooperative ("CVEC"). CVEC opted to pay all of its excess fuel costs up front and obtained financing through a cooperative lender at a fixed interest rate of 2.465% over ten years. For comparison, the rate-payer backed bonds at issue in this case have an expected weighted average interest rate of 2.58% (but in no case to exceed 6.0%) over 28 years. ¶3 Regardless of the legitimacy of these protests, this Court has long recognized that our obligation in reviewing bonds is to determine whether they facially violate the law. In re Application of Okla. Turnpike Auth., 2018 OK 88, ¶ 5, 431 P.3d 59, 60-61. ¶4 Upon review, the questions above and most others raised by the Protesters, relate to the Corporation Commission's Final Financing Order, including the settlement agreement and whether OG&E prudently incurred its fuel cost. These issues constitute matters of public policy, which fall exclusively within the purview of the Legislature and the Corporation Commission and go beyond the scope of our review. ¶5 I must say, however, I find it hard to reconcile that our statutorily-mandated pre-approval of the bonds in this matter--which cannot touch on substantive questions raised by the Protestors--serves to foreclose the right of these individuals and others in the future to challenge the legitimacy of the bonds or to raise any other valid legal issue. These consequences should not be taken lightly when the effect of our ruling will be to irrevocably saddle many Oklahomans with a significant financial obligation for the next twenty-eight years--and to establish additional precedent for future bond approvals.4 ¶6 The February 2021 Regulated Utility Consumer Protection Act, which established the procedure forming the basis of this matter, was enacted by the Legislature and signed into law by the Governor in February 2021. Despite my misgivings, our statutory mandate under the Act is limited to ruling upon the constitutionality of the policy, not to supplant the policy with our own. FOOTNOTES 1 In our recent decision, In re Application of the Oklahoma Capitol Improvement Authority, 2022 OK 31, I expressed reservations about issuing an advisory opinion approving a proposed loan agreement to finance infrastructure projects in Oklahoma. Here, we are faced with a similar request to approve the issuance of $800,000,000 in ratepayer-backed bonds intended to mitigate the impact of extreme fuel cost increases Oklahoma Gas and Electric Company ("OG&E") faced during the February 2021 winter storm. Again, we are asked to prematurely pass judgment on whether bonds which have yet to be issued comply with the laws and the Constitution of the State of Oklahoma. 2 Title 74, Section 9079 states, in pertinent part: If the Court shall be satisfied that the bonds or any portions thereof have been properly authorized in accordance with this act and the Constitution of the State of Oklahoma, and that when issued they will constitute valid obligations in accordance with their terms, the Court shall render its written opinion approving the ratepayer-backed bonds and shall fix the time within which a petition for rehearing may be filed. The cursory nature of our review is perhaps underscored by the Attorney General's Notice of Non-Intervention filed March 1, 2022, in which he states: The difficult policy decisions faced by the [Corporation] Commission in Cause No. PUD 202100072 are not presented here for the Court's review. Instead, the Court is called upon to review the bonds proposed by the Oklahoma Development Finance Authority to determine their constitutional validity. Counsel for the Authority has ably briefed these questions, and the Attorney General would have nothing substantial to add. (emphasis in original). 3 Section 9079 goes on to say: The decision of the Court shall be a judicial determination of the validity of the bonds, shall be conclusive as to the Authority, the state, its officers, agents and instrumentalities, and all other persons, and thereafter the bonds so approved and the revenues pledged to their payment shall be incontestable in any court in this state. 4 Notably, three similar applications by the ODFA are presently pending before this Court, which if approved would result in issuance of more than two billion dollars in ratepayer-backed bonds. See In re App. of Okla. Dev. Fin. Auth. for Approval of $1,450,000,000 Ratepayer-Backed Bonds (Okla. Natural Gas Co.), No. 120,274 (Okla. Sup. Ct. 2022); In re App. of Okla. Dev. Fin. Auth. for Approval of $725,000,000 Ratepayer-Backed Bonds (Pub. Serv. Co. of Okla.), No. 120,275 (Okla. Sup. Ct. 2022); See In re App. of Okla. Dev. Fin. Auth. for Approval of $95,000,000 Ratepayer-Backed Bonds (Summit Utils. Okla), No. 120,276 (Okla. Sup. Ct. 2022). These applications combined with the one at issue in this case will constitute $3,070,000,000 in bonded indebtedness to be borne by Oklahomans. For reference, the State's budget for FY 2022 authorized approximately $9,060,000,000 in appropriations. See H.B. 2900, 58th Leg, 1st Sess. (Okla. 2021); Governor Stitt Signs FY 2022 State Budget Package into Law, https://oklahoma.gov/governor/newsroom/newsroom/2021/may/governor-stitt-signs-fy-2022-state-budget-package-into-law.html?msclkid=88d451f9c7df11eca4a990d86c0868cc (last modified Aug. 18, 2021).

a97feed0-bf88-4870-a19d-bd7bf26b2f31

Crown Energy Co. v. Mid-Continent Casualty Co.

oklahoma

Oklahoma Supreme Court

CROWN ENERGY COMPANY v. MID-CONTINENT CASUALTY CO.2022 OK 60Case Number: 116989Decided: 06/14/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CROWN ENERGY COMPANY, Plaintiff/Appellee,v.MID-CONTINENT CASUALTY CO., Defendant/Appellant. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION II Honorable Aletia Haynes Timmons, District Judge ¶0 Crown Energy Company ("Crown") brought suit against Mid-Continent Casualty Company ("Mid-Continent") seeking declaratory judgment that two commercial general liability policies issued to Crown provided coverage for claims of property damage brought against Crown in a separate action. The claims arose out of seismic activity allegedly caused by Crown's use of waste water disposal wells in its oil and gas operations. Mid-Continent filed a counterclaim, seeking declaratory judgment that the claims were not covered under the policies because the seismic activity did not constitute an "occurrence" and that the claims fell within a pollution exclusion to the policies. The trial court granted summary judgment in favor of Crown. Mid-Continent appealed, and the matter was assigned to the Court of Civil Appeals, Division II. The Court of Civil Appeals affirmed the trial court's judgment. We hold that the seismic activity did constitute an occurrence under the policies and that the pollution exclusion does not bar coverage. CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION VACATED;JUDGMENT OF THE TRIAL COURT AFFIRMED. A. Michele Campney, Cheek & Falcone, PLLC, Oklahoma City, Oklahoma, and Kris Ted Ledford, Ledford Law Firm, Owasso, Oklahoma, for Plaintiff/Appellee. Christopher W. Martin, Martin, Disiere, Jefferson & Wisdom, L.L.P., Houston Texas, and Robert P. Fitz-Patrick, Hall, Estill, Hardwick, Gable, Golden & Nelson, P.C., Tulsa, Oklahoma, for Defendant/Appellant. ROWE, J.: I. BACKGROUND ¶1 Appellee, Crown Energy Company ("Crown"), is an Oklahoma City-based oil and gas producer operating in the Payne County formations. In the course of its oil and gas operations, Crown produces a large volume of waste water, which it stores in underground disposal wells. ¶2 In 2015, Crown sought commercial general liability insurance from Appellant, Mid-Continent Casualty Company ("Mid-Continent"). As part of its application, Crown included specific information about the nature of Crown's oil and gas operations. Mid-Continent ultimately issued two commercial general liability policies to Crown, Policy Number 04-GL-943967 and Policy Number 04-GL-963176, which covered two consecutive one-year periods from October 2015 to November 2017 ("the Policies"). Section I of the Policies provides: 1. Insuring Agreement a. We will pay those sums that the insured becomes legally obligated to pay as damages because of "bodily injury" or "property damage" to which this insurance applies. We will have the right and duty to defend the insured against any "suit" seeking those damages. However, we will have no duty to defend the insured against any "suit" seeking damages for "bodily injury" or "property damage" to which this insurance does not apply. [...] b. This insurance applies to "bodily injury" and "property damage" only if: (1) The "bodily injury" or "property damage" is caused by an "occurrence" that takes place in the "coverage territory"; (2) The "bodily injury" or "property damage" occurs during the policy period; and (3) Prior to the policy period, no insured [...] knew that the "bodily injury" or "property damage" had occurred, in whole or in part. [...] Each of the Policies contains a modified Pollution Exclusion in an Oil and Gas Endorsement, which replaces the standard pollution exclusion and states that the insurance does not apply to: Pollution To "Bodily Injury" or "Property Damage" arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon the land, the atmosphere or any water course or body of water; but this exclusion does not apply to a "Pollution Incident".1 ¶3 In December 2016, Crown was one of several oil and gas companies named as defendants in a class action suit filed by a group of Payne County residents (the "Reid Lawsuit").2 The Reid Lawsuit primarily alleges that increased underground pressure resulting from the use of waste water disposal wells by Crown and other defendants caused seismic activity that damaged the plaintiffs' property. After the Reid Lawsuit was filed, Crown submitted a claim to Mid-Continent requesting defense and indemnity. In a letter dated December 27, 2016, Mid-Continent denied Crown's request, claiming that the damages asserted in the Reid Lawsuit were not caused by an "occurrence" as defined by the policy and citing the Pollution Exclusion in the Oil and Gas Endorsement ("the Pollution Exclusion"). ¶4 Crown sought declaratory relief against Mid-Continent in the District Court of Oklahoma County, alleging the claims in the Reid Lawsuit are covered under the Policies. Mid-Continent denied the allegations and filed a counterclaim seeking declaratory judgment that the Policies did not cover the claims in the Reid Lawsuit. In April 2018, the District Court granted Crown's motion for summary judgment in part, finding that Mid-Continent had a duty to defend Crown in the Reid Lawsuit. ¶5 Mid-Continent's appeal of the trial court's order granting Crown's motion for summary judgment was assigned to the Court of Civil Appeals, Division II ("COCA"). COCA issued a published opinion on September 24, 2020, affirming the trial court's order. With respect to the Pollution Exclusion, COCA observed that the seismic activity which prompted the Reid Lawsuit was caused by injection of waste water into the disposal wells at high pressure. Having determined that the pressure generated by the waste water injections was the cause of the seismic activity, COCA found that the Pollution Exclusion did not apply to Crown's activities because it did not include any reference to injection of pollutants into the land "under pressure." In October 2020, Mid-Continent filed a Petition for Rehearing claiming that COCA's emphasis on the pressure at which the waste water was injected amounted to a "new and independent theory of causation" that undermined the effect of the Pollution Exclusion. COCA denied Mid-Continent's Petition for Rehearing. ¶6 Mid-Continent filed its Petition for Certiorari, claiming COCA erred by placing too great an emphasis on the pressure issue in finding that the Pollution Exclusion did not apply. Mid-Continent also claimed that COCA erred in finding that Crown's wastewater disposal activities constituted an "occurrence" under the Policy. We granted certiorari on September 27, 2021. II. STANDARD OF REVIEW ¶7 We review a trial court's order granting summary judgment de novo. Tiger v. Verdigris Valley Elec. Coop., 2016 OK 74, ¶ 13, 410 P.3d 1007, 1011. Likewise, the interpretation of an insurance contract presents questions of law, which are subject to de novo review. Dodson v. St. Paul Ins. Co., 1991 OK 24, ¶ 12, 812 P.2d 372, 376. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. III. DISCUSSION ¶8 Mid-Continent alleges that COCA erred on two counts in affirming the trial court's order granting summary judgment. First, Mid-Continent claims COCA erred in finding that Crown's wastewater disposal efforts constituted an "occurrence" under the Policies. Second, Mid-Continent claims that COCA erred in finding that the Pollution Exclusion did not bar coverage for the claims in the Reid Lawsuit. ¶9 Parties are free to contract for insurance that covers whatever risks they see fit, and they will be bound by the terms of the contract. Porter v. Oklahoma Farm Bureau Mut. Ins. Co., 2014 OK 50, ¶ 12, 330 P.3d 511, 515 (citing Cranfill v. Aetna Life Ins. Co., 2002 OK 26, ¶ 5, 49 P.3d 703, 707). Courts are not free to rewrite the terms of an insurance contract. Id. Our primary objective when interpreting a contract is to effectuate the intent of the parties as expressed in the terms of the contract. Walker v. BuildDirect.com Techs. Inc., 2015 OK 30, ¶ 9, 349 P.3d 549, 552. If the terms of the contract are clear, consistent, and unambiguous, they are accepted in their ordinary sense. Dodson v. St. Paul Ins. Co., 1991 OK 24, ¶ 12, 812 P.2d 372, 376. A. The property damage which prompted the Reid Lawsuit was caused by an "occurrence." ¶10 Mid-Continent's first assignment of error is based on the Policies' definition of an "occurrence." Subsection 1(b) under Coverages in the Policies states that the insurance only applies if the damage at issue is, among other things, caused by an "occurrence." According to the Policies, an "occurrence" refers to: [A]n accident, including continuous or repeated exposure to substantially the same general harmful conditions. Mid-Continent claims that because Crown was intentionally injecting waste water into the disposal well, its activities could not constitute an accident, and therefore, coverage for the claims in the Reid Lawsuit does not lie. ¶11 In support of its position, Mid-Continent cites to Cranfill v. Aetna Life Ins. Co., 2002 OK 26, 49 P.3d 703. In Cranfill, we answered two certified questions relating to whether an insured's beneficiary was entitled to accidental death benefits when the insured intentionally consumed alcohol beyond the legal limit to operate a vehicle and subsequently died in a single-vehicle car wreck.3 Relying on a prior case in which we described an accident as an event that is "unexpected, unintended and unforeseen in the eyes of the insured,"4 Aetna argued that the insured's death was a reasonably foreseeable consequence of drunk driving and, thus, was not an accident. Id. ¶ 9, 49 P.3d at 706. We rejected that argument, explaining that the principle of reasonable foreseeability, which is applicable in torts, does not apply when analyzing the terms of an insurance contract. Id. ¶ 10, 49 P.3d at 706-07. We went on to explain how foreseeability should factor into determining whether an accident occurs: Foreseeability has a more specific meaning in the context of life and accident insurance. It is only when the consequences of the act are so natural and probable as to be expected by any reasonable person that the result can be said to be so foreseeable as not to be accidental. The mere fact that an insured's death may have resulted from his or her own negligence, or even gross negligence, does not prevent that death from being accidental under the plain meaning of the word accident. (Internal citations omitted). ¶12 Relying on Cranfill, Mid-Continent claims that the seismic activity that prompted the Reid Lawsuit was such a natural and probable consequence of Crown's waste water disposal activities that it could not be deemed an accident. We disagree. Mid-Continent offers little to no evidence in support of its position, instead relying on allegations made by the plaintiffs in the Reid Lawsuit.5 Self-serving allegations by the Reid plaintiffs in their petition are not sufficient to support Mid-Continent's generalization that "[Crown] and the oil and gas industry had actual (or at least constructive) notice that it[s] wastewater disposal activities could cause seismic activity and earthquakes, and that [Crown] continued those activities in spite of such knowledge."6 Even if the allegations in the Reid Lawsuit petition were sufficient evidence, Mid-Continent's position remains untenable. The fact that there is some risk of seismic activity associated with Crown's waste water disposal activities does not mean that seismic activity is such a natural and probable consequence of those activities that it should be expected.7 Accordingly, we find that the earthquakes which prompted the Reid Lawsuit were accidental and, thus, constitute an "occurrence" under the Policies. B. The Pollution Exclusion does not bar coverage for the claims in the Reid Lawsuit. ¶13 Mid-Continent maintains that, even if the earthquakes at issue did constitute an occurrence, the claims in the Reid Lawsuit are barred from coverage based on the Pollution Exclusion. The primary text of the Pollution Exclusion states that the insurance afforded by the Policies does not apply: To "Bodily Injury" or "Property Damage" arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon the land, the atmosphere or any water course or body of water; but this exclusion does not apply to a "Pollution Incident".8 Relying on the breadth of the "arising out of language," Mid-Continent insists that the Pollution Exclusion clearly and unambiguously precludes coverage for the Reid Lawsuit because the claims "[arose] out of the discharge ... of ... toxic liquids ... waste materials ... contaminants or pollutants into or upon the land."9 Citing regulations10 promulgated by the Oklahoma Corporation Commission which identify waste water as a "deleterious substance," Mid-Continent also reasons that waste water is "undeniably either a toxic liquid, waste material, pollutant or contaminant."11 Finally, Mid-Continent points out that similar pollution exclusions have been found to clearly and unambiguously preclude coverage for a variety of claims, even those which do not involve traditional environmental pollution. See discussion of Bituminous Cas. Corp. v. Cowen Constr., Inc., 2002 OK 34, 55 P.3d 1030, infra ¶¶ 23-24. ¶14 Crown asserts that the Pollution Exclusion is ambiguous as to whether it applies to the claims in the Reid Lawsuit, and asks that we apply the reasonable expectations doctrine to find that there is coverage under the Policies. According to the reasonable expectations doctrine, where an ambiguity in an insurance contract exists, it should be resolved in accordance with the reasonable expectations of the parties. Max True Plastering Co. v. U.S. Fid. & Guar. Co., 1996 OK 28, ¶ 24, 912 P.2d 861, 870. Ambiguity exists in an insurance contract when it is reasonably susceptible to more than one interpretation. Broom v. Wilson Paving & Excavating, Inc., 2015 OK 19, ¶ 30, 356 P.3d 617, 628 (quoting Max True Plastering Co., 1996 OK 28, ¶ 20, 912 P.2d at 869). If a contract is ambiguous, we must determine whether an insured could have reasonably expected coverage under its terms. Id. ¶ 31, 356 P.3d at 628-29. We will not permit ambiguous clauses to defeat coverage that was reasonably expected by the insured. Id. We construe ambiguities against the insurer and in favor of the insured. Id. ¶15 Crown further asserts that the Pollution Exclusion is ambiguous, at least insofar as to whether it applies to claims arising out of seismic activity. Crown notes that the property damage that formed the basis of the Reid Lawsuit was not caused by the polluting nature of the waste water it was producing. Rather, the damage was the result of pressure and displacement caused by the injection of the waste water into underground disposal wells. Crown's position is that the Pollution Exclusion is ambiguous as to whether it bars coverage for property damage claims when the damage is not caused by the polluting nature of an otherwise toxic or polluting substance. To illustrate its position on the alleged ambiguity, Crown references Pipefitters Welfare Educational Fund v. Westchester Fire Insurance Company, 976 F.2d 1037, 1043 (7th Cir. 1992), which contains this seminal analysis: The terms 'irritant' or 'contaminant,' when viewed in isolation are virtually boundless, for 'there is virtually no substance or chemical in existence that would not irritate or damage some person or property.' Without some limiting principle, the pollution exclusion clause would extend far beyond its intended scope, and lead to some absurd results. To take but two simple examples, reading the clause broadly would bar coverage for bodily injuries suffered by one who slips and falls on the spilled contents of a bottle of Drano, and for bodily injury caused by an allergic reaction to chlorine in a public pool. Although Drano and chlorine are both irritants or contaminants that cause, under certain conditions, bodily injury or property damage, one would not ordinarily characterize these events as pollution. (internal citations omitted). ¶16 We addressed a substantially similar pollution exclusion in National American Insurance Company v. New Dominion, LLC, 2021 OK 62, 499 P.3d 9, which we adopted approximately two months after granting certiorari here. The insured in New Dominion, an oil and gas company, was sued in a series of separate lawsuits alleging that its oil and gas operations resulted in seismic activity that caused bodily injury to the plaintiffs and damaged their property. Id. ¶ 14, 499 P.3d at 14. The insured sought defense and indemnity from the insurance company, but the insurance company denied the claims, citing a pollution exclusion,12 among other things. Id. On appeal, the insured argued that the pollution exclusion was ambiguous and that we should apply the reasonable expectations doctrine. Id. ¶ 24, 499 P.3d at 16. We summarized the alleged ambiguity in the exclusion as follows: New Dominion contends that the ambiguity in the Total Pollution Exclusion stems from the phrase "irritant or contaminant" in the definition of pollutants. New Dominion claims that this language led it to reasonably believe that the exclusion would only apply when the bodily injury or property damage for which coverage is sought arises out of the irritating or contaminating nature of the pollutant. New Dominion contends it did not contemplate that the exclusion would apply in instances where an irritating or contaminating substance, in this case wastewater, caused bodily injury or property damage that was not the result of the wastewater's irritating or contaminating nature. Id. ¶ 26, 499 P.3d at 16. We found that the pollution exclusion was ambiguous as to whether the waste water in question constituted an irritant or contaminant and that the insured had a reasonable expectation of coverage under the policy.13 Id. ¶ 30, 499 P.3d at 17. In doing so, we offered the following on the use of pollution exclusions to deny coverage for claims arising out of seismic activity: What the foregoing analysis shows is that the Total Pollution Exclusions were never meant to apply to earthquake-related incidents. They were designed to preclude coverage for a different class of catastrophic occurrences, namely pollution events. NAICO's attempt to shoehorn the earthquake claims that prompted this litigation into the class of events to which the Total Pollution Exclusion logically applies promotes an illogical conclusion. Moreover, this Court will not endorse an absurdly expansive reading of the Total Pollution Exclusions and, in so doing, legitimize a fairly transparent attempt by NAICO to further limit its exposure by invoking inapplicable exclusions to deny coverage. Id. ¶ 33, 499 P.3d at 18. ¶17 In response to New Dominion, Mid-Continent claims that the Pollution Exclusion in this matter is distinguishable. First, Mid-Continent contends that the Pollution Exclusion here is broader in scope because it uses the "arising out of" language. Second, Mid-Continent notes the Pollution Exclusion does not rely on a separate definition of pollutants, instead incorporating a range of substances that constitute irritants, contaminants, or pollutants into the exclusion itself. Third, Mid-Continent claims that the Pollution Exclusion is different in that it is contained within a special Oil and Gas Endorsement that applies to particular aspects of Crown's oil and gas operations, making it an "operational exclusion." Crown asks this Court to apply the same reasoning that it did in New Dominion to find that Mid-Continent is seeking to invoke an inapplicable exclusion to deny coverage. ¶18 Given the number of similarities between this matter and New Dominion--including the nature of the claims in the underlying lawsuit, the respective pollution exclusions, the alleged ambiguity in the exclusions, and the arguments asserted by the parties--the operative question in this appeal becomes whether any terms unique to this Pollution Exclusion expand its scope to such an extent that it would preclude coverage for the underlying claims. ¶19 Mid-Continent fails to explain how the inclusion of the "arising out of" language so drastically expands the scope of the Pollution Exclusion that it bars coverage for the Reid Lawsuit claims. Although the "arising out of" language may arguably expand the scope of the exclusion, it fails to resolve the underlying ambiguity--whether the Pollution Exclusion applies in instances where the damage at issue is not attributable to the waste water's toxic or polluting nature. Even if we were to interpret the "arising out of" language in the light most favorable to Mid-Continent, affording it the broadest possible meaning, it still fails to clarify whether the Pollution Exclusion should apply in those instances. Accordingly, we cannot find that the "arising out of" language in the Pollution Exclusion serves to bar coverage. ¶20 Mid-Continent also notes that, unlike in New Dominion, the Pollution Exclusion here does not rely on a separate definition of "pollutants." However, Mid-Continent fails to explain what significance, if any, we should ascribe to this fact. For reference, the pollution exclusion in New Dominion barred coverage for bodily injury and property damage caused by "pollutants." New Dominion, 2021 OK 62, ¶23, 499 P.3d at 16. Pollutants were defined as "[A]ny solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste." Id. (emphasis added). In comparison, though not separately defining a pollutant, the Pollution Exclusion here states that the insurance provided by the Policies does not apply to bodily injury or property damage caused by "smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon the land ...." (emphasis added). The similarity of these terms is undeniable. The most significant distinction, as noted by Mid-Continent, is that the latter is incorporated into the Pollution Exclusion itself. Otherwise they both contain nearly identical lists of classes of substances, all of which fall within the general categories of irritants, contaminants, or pollutants. We see no reason why the incorporation of this definition into the exclusion itself resolves the alleged ambiguity. ¶21 Mid-Continent further claims that the Oil and Gas Endorsement, in which the Pollution Exclusion is contained, constitutes an "operational exclusion" with much broader effect than a typical pollution exclusion. Mid-Continent's position appears to be that since some of Crown's operational activities--such as disposing of waste water in underground wells--could fall within the scope of the Pollution Exclusion, that the Endorsement is directed at Crown's operations generally rather than pollution that arises out of those operations. Even if the Oil and Gas Endorsement is directed at Crown's operations, the text of the exclusion contained therein must still specifically preclude coverage. It does not. ¶22 Mid-Continent's two remaining arguments are likewise unpersuasive. First, Mid-Continent claims that the waste water at issue here unquestionably qualified as an irritant, contaminant, or pollutant. Mid-Continent is correct that the waste water that was being disposed of constitutes a "deleterious substance" and had the potential to cause bodily injury or property damage by virtue of its polluting nature. However, the property damage that prompted the Reid Lawsuit was not caused by the waste water's polluting nature and thus would not fall within the scope of the Pollution Exclusion.14 ¶23 Second, Mid-Continent notes that we have found pollution exclusions unambiguous in the past and asks us to find the same here. The fact that pollution exclusions have been held to be unambiguous in other settings does not mean that the Pollution Exclusion here is unambiguous as applied. Mid-Continent identifies Bituminous Casualty Corp. v. Cowen Construction, Inc., 2002 OK 34, 55 P.3d 1030, in which we found a pollution exclusion to be unambiguous. In Bituminous, the insurer brought an action in federal court seeking declaratory judgment that a pollution exclusion similar to the one at issue here precluded coverage for bodily injury claims asserted by several patients at a kidney dialysis center who suffered lead poisoning due to negligent construction by the defendant. Id. ¶¶ 3-6, 55 P.3d at 1032-33. The federal court certified a number of questions to this Court, including whether the scope of the pollution exclusion was limited to environmental pollution in the traditional sense. Id. ¶ 1, 55 P.3d at 1031-32. We answered that question in the negative, and in doing so, determined that the pollution exclusion was clear and unambiguous. Id. ¶¶ 13-14, 55 P.3d at 1034-35. ¶24 In New Dominion we found Bituminous distinguishable because it did not address the same alleged ambiguity. New Dominion, 2021 OK 62, ¶ 30, 499 P.3d at 17. We reach the same conclusion here. While waste water may have the toxic and deleterious qualities of a "pollutant," the damage it allegedly caused in the Reid Lawsuit is not attributable to those qualities. Although pollution exclusions may apply in circumstances beyond those involving traditional environmental pollution, Bituminous does not require that pollution exclusions uniformly apply in every circumstance where damage is caused by a "pollutant." ¶25 Based on the foregoing, we find that the Pollution Exclusion is ambiguous, at least as to whether it applies to the claims in the Reid Lawsuit. Because we construe ambiguous provisions in an insurance contract in favor of the insured, we find that Crown could have reasonably expected coverage under the Policies. IV. CONCLUSION ¶26 We find that the property damage that prompted the Reid Lawsuit was caused by an "occurrence," as that term is used in the Policies. Additionally, we find that the Pollution Exclusion does not clearly and unambiguously preclude coverage for the claims in the Reid Lawsuit. COCA's opinion is hereby vacated. The judgment of the trial court is affirmed. CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION VACATED;JUDGMENT OF THE TRIAL COURT AFFIRMED. Darby, C.J., Kauger, Winchester, Edmondson, Combs, Gurich, Rowe, and Kuehn, JJ., concur. Kane, V.C.J., not participating. FOOTNOTES 1 The Oil and Gas Endorsement defines a "Pollution Incident" as: [T]he sudden and accidental emission, discharge, release or escape of pollutants into or upon the land, atmosphere or any water course or body of water, provided that such emission, discharge, release or escape emanates from operations conducted on land and results in "Bodily Injury" or "Property Damage". The entirety of any such emission, discharge, release or escape shall be deemed to be one "Pollution Incident". A "Pollution Incident" does not include any of the following: (1) "Property Damage" to or emanating from a "Waste Facility".(2) "Bodily Injury" or "Property Damage" arising out of ownership of, or work or operations performed on any oil and gas lease in oceans, gulfs or bays.(3) "Bodily Injury" or "Property Damage" arising out of a "Pollution Incident" which results from or is attributable to a failure to comply with any applicable statute, regulation, ordinance, directive or order relating to the protection of the environment and promulgated by any governmental body, provided that failure to comply is a willful or deliberate act or omission.(4) Any fine or penalty imposed by any governmental or regulatory body.(5) "Property Damage" to any property used or occupied to conduct operations at a lease site. A "Waste Facility" refers to: [A]ny site to which waste is legally consigned for delivery or delivered for storage, disposal, processing or treatment, provided that such site is licensed by state or federal authority to perform such storage, disposal, processing or treatment. Salt water disposal or injection wells are not considered to be "Waste Facilities". 2 See David & Myra Reid et al. v. White Star Petroleum, LLC et al., No. CJ-2016-543 (Dist. Ct. Payne Cty. Filed Dec. 5, 2016). 3 Below is the full text of the certified questions in Cranfill: A. Under Oklahoma law, for purposes of an accidental death and dismemberment insurance policy, is an insured's death "accidental" or is it an "intentionally self-inflicted injury" when the insured intentionally consumes alcohol to a blood alcohol level more than two and one-half times the legal limit for operating a motor vehicle and then dies in a single-vehicle accident caused by the act of drinking and driving? B. For purposes of coverage under an accidental death and dismemberment insurance policy, does Oklahoma public policy prohibit an insured or the insured's beneficiary from recovering accidental death benefits when the insured intentionally consumes alcohol to a blood alcohol level more than two and one-half times the legal limit for operating a motor vehicle and then dies in a single-vehicle accident caused by the act of drinking and driving? Cranfill v. Aetna Life Ins. Co., 2002 OK 26, ¶ 1, 49 P.3d 703, 705. 4 See Willard v. Kelley, 1990 OK 127, ¶ 15, 803 P.2d 1124, 28-29. 5 This court is bound by the record on appeal. State ex rel. Dept. of Transp. v. Little, 2004 OK 74, ¶ 24, 100 P.3d 707, 720. While compelling evidence in support of Mid-Continent's position may exist, we cannot hypothesize or inquire beyond what the record before us shows. Additionally, Oklahoma Supreme Court Rule 1.11(k)(1) makes clear, "Argument without supporting authority will not be considered." 6 Petition for Certiorari at 10 n.16. 7 Crown attached a number of studies and literature reviews to its Response to the Petition in the Reid Lawsuit. While we do not rely on those materials in reaching our conclusion, they support the conclusion that most waste water disposal wells are unlikely to produce seismic activity. For instance, one report from the Congressional Research Service states, "Several studies have pointed out that, of the more than 30,000 wastewater disposal wells classified by the Environmental Protection Agency (EPA) as Class II, only a small fraction appears to be associated with damaging earthquakes." Peter Folger & Mary Tiemann, Congressional Research Service, Human-Induced Earthquakes from Deep-Well Injection: A Brief Overview 2 (2016) (internal citations omitted) (emphasis added). 8 Neither party explicitly claims that Crown's use of waste water disposal wells qualifies as a "pollution incident" as that term is defined in the Policies. A "pollution incident" occurs when there is a "sudden and accidental emission, discharge, release or escape of pollutants." Crown's injection of waste water into its disposal wells was a prolonged and intentional part of its oil and gas operations. The record does not reflect that any of the waste water being stored in the disposal wells escaped or was unintentionally released, nor does it reflect that any of the damage which formed the basis of the Reid Lawsuit was caused by the escape or unintentional release of the waste water. 9 Petition for Certiorari at 9. 10 The Petition for Certiorari references 165 OAC § 10-1-2, which defines "deleterious substances" as "any chemical, salt water, oil field brine, waste oil, waste emulsified oil, basic sediment or mud produced or used in the drilling development, production, transportation, refining, and processing of oil, gas and/or brine meaning." 11 Petition for Certiorari at 8 n.13. 12 For reference, the pollution exclusion in New Dominion excluded coverage for bodily injury and property damage "which would not have occurred in whole or in part but for the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of 'pollutants' at any time." Pollutants were defined in that policy as "any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste." 13 We note here that the ambiguity in New Dominion is very similar to that claimed by Crown in the present matter. The insured in New Dominion even cites to the same passage from Pipefitters Welfare Educational Fund v. Westchester Fire Insurance Company, 976 F.2d 1037, 1043 (7th Cir. 1992), that Crown cites here to explain its position. 14 We addressed a very similar argument in New Dominion as well. The insurance company claimed that the waste water in question constituted "waste" and thereby fell within the definition of a "pollutant." We rejected that argument: NAICO's contention that wastewater constitutes "waste" does not resolve this ambiguity. While wastewater may meet the definition of "waste" set out in the policy, the definition given for pollutants is more exacting. The wastewater must also constitute as "solid, liquid, gaseous or thermal irritant or contaminant." The wastewater does not meet this definition because the harm caused was not the result of the wastewater's irritating or contaminating nature. Rather, the earthquakes and the harm they caused were the result of wastewater being injected back into the ground under highly pressurized conditions. New Dominion makes a compelling point that the substance being injected into the ground could have been something more innocuous, such as fresh, potable water, and the result would have been the same. New Dominion, 2021 OK 62, ¶ 31, 499 P.3d at 17-18.

9de7a6a9-9682-4af0-9ce6-7e3277e0848b

S.K.W. v. Oklahoma

oklahoma

Oklahoma Supreme Court

S.K.W. v. STATE2022 OK 39Case Number: 119607Decided: 04/19/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. S.K.W., Plaintiff/Appellant,v.THE STATE OF OKLAHOMA, Defendant/Appellee. APPEAL FROM THE DISTRICT COURT OF CANADIAN COUNTY Honorable Jack D. McCurdy, II., Trial Judge ¶0 The plaintiff/appellant, S.K.W., was convicted of three drug related crimes in 2001, in Canadian County, Oklahoma, and two drug related crimes in 2002, in Blaine County, Oklahoma. On January 5, 2021, the Governor pardoned W. of all five convictions. Subsequently, she sought expungement of her criminal records in both Blaine and Canadian Counties pursuant to 22 O.S. Supp. 2019 §18. The Blaine County District Court granted W.'s expungement request, but the Canadian County District Court denied it. The trial court based its denial on two Oklahoma Court of Civil Appeals cases which interpreted the statute to allow one single conviction to be expunged, not multiple convictions. W. appealed. We retained the cause to examine expungement pursuant to 22 O.S. Supp. 2019 §18. We hold that because the expungement was based on the Governor's pardon of all five convictions, the plain, unambiguous text of 22 O.S. Supp. 2019 §18 allows expungement of all of them. The appellant's unopposed request for appeal-related costs is granted. CAUSE PREVIOUSLY RETAINED; TRIAL COURT REVERSED AND CAUSE REMANDED. Michael A. Risley, Oklahoma City, Oklahoma, for Plaintiff/Appellant. Mitchell Thrower, Assistant District Attorney for Canadian County, El Reno, Oklahoma, for Defendant/Appellee. Shannon J. Desherow, Assistant General Counsel for Oklahoma State Bureau of Investigation, Oklahoma City, Oklahoma, for OSBI/a required party. KAUGER, J.: ¶1 We retained this cause to address expungement pursuant to 22 O.S. Supp. 2019 §18.1 We hold that because the expungement was based on the Governor's pardon of all five convictions, the plain, unambiguous language of 22 O.S. Supp. 2019 §18 allows expungement of all of them. We also grant the appellant's unopposed request for appeal-related costs. PROCEDURAL HISTORY ¶2 The plaintiff/appellant, S. K. W. (W.) was convicted, of five crimes relating to the manufacturing, trafficking, and possession of a controlled dangerous substance in Blaine and Canadian Counties in 2001 and 2002.2 According to W., her arrest stemmed from her two-year addiction (2000-2002) to methamphetamine, which she struggled with after the unexpected death of her mother. Also according to W., while in the Department of Corrections custody, she dried out, got help dealing with her underlying emotional issues, and has been sober for nineteen years. ¶3 On January 5, 2021, the Governor, J. Kevin Stitt, issued W. a Certificate of Pardon, granting her a full pardon.3 On March 8, 2021, W. filed a Petition to Expunge. The State, through the Canadian County District Attorney (DA), objected to the expungement, arguing that the plain language of 22 O.S. Supp. 2019 §18,4 does not allow the expungement of multiple offenses, even when all of the offenses have been pardoned by the Governor. The DA relied on Holder v. State, 2009 OK CIV APP 1, 219 P.3d 562, and Olson v. State, 2012 OK CIV APP 85 to support his argument that because W. had four separate felony offenes and one misdemeanor offense, her Petition for Expungement must be denied. ¶4 W. responded, arguing that: 1) the Canadian County District Attorney is totally alone in objecting to the expungement; 2) Blaine County had already completed her expungement in that county; and 3) neither the Oklahoma State Bureau of Investigation, the Oklahoma Department of Corrections, the Oklahoma Pardon and Parole Board, the City of El Reno, the Blaine County District Attorney nor District Judge Woodward had disagreed that she was statutorily entitled to expungement. ¶5 After a May 10, 2021, hearing, the trial court issued and filed an order on May 17, 2021, denying W.'s Petition for Expungement. On May 27, 2021, W. appealed to this Court. On June 1, 2021, we retained the cause to address statutory requirements of expungement. On February 18, 2022, W. filed a separate application for her appeal-related costs to be awarded in this Court. I. BECAUSE THE EXPUNGEMENT WAS BASED ON THE GOVERNOR'S PARDON OF ALL FIVE CONVICTIONS, THE PLAIN, UNAMBIGUOUS TEXT OF 22 O.S. SUPP. 2019 §18 ALLOWS THE EXPUNGEMENT OF ALL OF THEM. ¶6 The DA argues that because W. had four separate felony offenses and one misdemeanor offense, the Petition for Expungement must be denied. W. argues that the plain language of the statute allows the expungement of multiple offenses when the Governor pardons all of the offenses. We agree with W. A. The Expungement Process/History. ¶7 In 1987, the Legislature authorized the district courts to expunge/seal certain criminal records with the enactment of 22 O.S. Supp. 1987 §18 which provided: Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories: 1. the person has been acquitted;2. the person was arrested and no charges are filed or charges are dismissed within one (1) year of the arrest; or3. the statute of limitations on the offense had expired and no charges were filed. For purposes of this act, 'expungement' shall mean the sealing of criminal records.5 Section 18, has been amended eighteen times since its 1987 enactment. Procedurally, a petition for expungement is lodged in the district courts,6 and expungement appeals from the district courts are brought to the Oklahoma Supreme Court.7 ¶8 The first amendment was in 1992. It added that a "person" "under eighteen (18) years of age at the time the offense was committed and the person has received a full pardon for the offense" as someone authorized to seek expungement.8 The Okla. Const. art. 6, §10 grants the Governor the power to pardon.9 Through multiple amendments, over fifteen years, the field of persons authorized to seek expungement has enlarged significantly. ¶9 The current version of 22 O.S. Supp. 2019 §18(4), which is at issue in this cause, provides that persons authorized to file for expungement include the person who has received a full pardon by the Governor for the crime for which the person was sentenced.10 B. Interpretation and Application of 22 O.S. Supp. 2019 §18. ¶10 We have not interpreted §18 as it relates to the Governor's pardon of criminal offenses.11 However, the Court of Civil Appeals, in Holder v. State, 2009 OK CIV APP 1, 219 P.3d 562, and subsequently in Olson v. State, 2012 OK CIV APP 85, held that the plain language of the statute prohibits expungement of multiple offenses, regardless of a Governor's pardon. ¶11 Holder, supra, concerned an individual (Holder) who was convicted of four crimes in 1986 and 1991.12 On December 19, 2006, the Governor granted Holder a full pardon of the crimes. Holder then sought expungement under the 22 O.S. 2001 and Supp. 2004 §18 of the statute.13 Under those versions, persons who were under eighteen when the offense was committed, and received a full pardon, were eligible to seek expungement,14 but Holder, apparently did not qualify under this category. ¶12 Rather, Holder sought expungement under the subsection which provided expungement if "[t]he offense was a nonviolent felony, as defined in Section 571 of Title 57 of the Oklahoma Statutes, the person has received a full pardon for the offense, the person has not been convicted of any other misdemeanor or felony, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the conviction."15 The court said that despite the Governor's constitutional power to grant a pardon, and despite that a Governor's pardon is expressly listed in the statute as a reason for expungement, the statute does not allow an individual with more than one offense to be entitled to expungement. ¶13 Subsequently, another division of the Court of Civil Appeals followed Holder, supra, in Olson v. State, 2012 OK CIV APP 85, 286 P.3d 296, when it held that the petitioner, Olson, was also not eligible for expungement because she had multiple convictions. Neither Holder nor Olson sought certiorari in this Court, and neither case is dispositive of this cause because they involved different subsections and different versions of the statute from the one at issue here. ¶14 Recently, in J.M.L. v. State, 2018 OK 103, 433 P.3d 726, in determining that the district courts' authority of expungement extended to municipal records, we explained that the remedial purpose of expungement requires a liberal construction of expungement statutes. The unanimous Court held that from the outset, the Legislature has made it convenient for a qualified person to pursue expungement. Expungement is "special relief . . . to aid those who are acquitted, exonerated, or who otherwise deserve a second chance at a 'clean record. . . .'" It has long been recognized that remedial statutes should be construed liberally so as to afford all the relief within the power of the court which the legislature intended to grant. ¶15 If we needed to apply rules of construction in this cause, we would be required to liberally construe it so as to afford all the relief which the legislature intended to grant. However, only where the legislative intent cannot be ascertained from the statutory language, i.e. in cases of ambiguity or conflict, are rules of statutory construction employed.16 Title 22 O.S. Supp. 2019 §18 unambiguously states that only one of the 15 categories listed in subsection A need to be met in order for a person to qualify for expungement. It states: "Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories."17 None of the 15 categories are followed by an "and," indicating that a person needed to qualify under more than one category to seek expungement.18 ¶16 Subsection 4 provides that one of the categories which qualifies is one in which the Governor has pardoned the individual, and it does not expressly limit the pardon to only one crime. It says: "The person has received a full pardon by the Governor for the crime for which the person was sentenced."19 Some of the other categories do discuss multiple crimes, and the consequences of multiple convictions and the type of convictions (felonies or misdemeanors), but subsection 4 does not.20 ¶17 We hold that the clear language of 22 O.S. Supp. 2019 §18 allows expungement of all of the crimes for which the Governor pardons an individual. Even if the use of the singular word "crime" rather than the plural "crimes" created an ambiguity as to whether the Legislature intended one and only one recprd pf a criminal conviction to be extinguishable when a Governor issues a pardon, a liberal construction of the term would be required to afford all the relief which the Legislature intended to grant and our holding would be unchanged. Holder v. State, 2009 OK CIV APP 1, 219 P.3d 562, and Olson v. State, 2012 OK CIV APP 85, are expressly overruled to the extent that they could be read to stand for the proposition that the statute does not allow an individual with more than one offense to be entitled to expungement pursuant to the Governor's pardon. III. REQUEST FOR APPEAL-RELATED COSTS GRANTED. ¶18 Although W.'s attorney is representing her pro bono, on February 18, 2022, W. filed an application for appeal-related costs of the $200.00 filing fee and the $42.00 transcript fee which have both been paid. W. seeks these costs pursuant to 12 O.S. 2011 §97821 and 12 O.S. 2011 App. 1, Okla. Sup. Ct. R. 1.14,22 in the event the trial court is reversed. The State has not filed an objection to the application for appeal-related costs. The application is hereby granted.23 CONCLUSION ¶19 After the Governor pardoned the appellant of five drug related crimes, appellant sought expungement of her criminal records pursuant to 22 O.S. Supp. 2019 §18.24 Because the expungement was based on the Governor's pardon of all five convictions, the plain, unambiguous language of 22 O.S. Supp. 2019 §18 allows expungement of all of them.25 The appellant's unopposed request for appeal-related costs is granted. CAUSE PREVIOUSLY RETAINED; TRIAL COURT REVERSED AND CAUSE REMANDED. ALL JUSTICES CONCUR. FOOTNOTES 1 Title 22 O.S. Supp. 2019 §18 has been amended eighteen times since its enactment in 1987. The statute, and amendments, will be discussed in the body of this opinion, infra. However, the specific subsection upon which the plaintiff relies currently provides in pertinent part: A. Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories: 4. The person has received a full pardon by the Governor for the crime for which the person was sentenced. 2 The details of the circumstances surrounding the crimes are not part of the record, but the case numbers and type of offense are included. They are: CF-2001-579, one felony count of unlawful manufacture of a controlled dangerous substance (CDS)(Methamphetamine); CV-2022-30, civil forfeiture relating to one felony count of possession of a CDS (Methamphetamine); CV-2002-31, civil forfeiture relating to one felony count of endeavoring to manufacture a CDS (Methamphetamine); and CM-2001-884, one misdemeanor count of unlawful possession of a CDS (Alprazolam). W. was arrested for all five crimes on October 16, 2001. 3 The Certificate of Pardon is dated January 5, 2021, and is signed by the Governor and the Secretary of State. It provides: TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETINGS: WHEREAS, S. K. W. was convicted of the following crime(s) in the State of Oklahoma: CF-2001-579, Canadian CountyCount 1: Unlawful Manufacturing of a Controlled Dangerous SubstanceCF-2001-578, Canadian CountyCount 1: Trafficking in Illegal DrugsCM-2001-884, Canadian CountyCount 1: Unlawful Possession of Controlled DrugCF-2002-30, Blaine CountyCount 1: Possession of a Controlled Drug with Intent to DistributeCF-2002-31, Blaine CountyCount 1: Unlawful Manufacture of a Controlled Dangerous Substance Date of Completion: 8/22/2009DOC #:431943 WHEREAS, it appears that S. K. W. has satisfactorily complied with all rules and conditions imposed, and the evidence presented to the Oklahoma Pardon and Parole Board indicates that S. K. W. has demonstrated exemplary conduct. Now, therefore, I, J., Kevin Stitt, Governor of the State of Oklahoma, pursuant to the authority vested in me by Section 10 of Article VI of the Oklahoma Constitution, do hereby grant S.K.W. a full pardon to restore all of the rights of citizenship..) IN WITNESS WHEREOF, I have hereunto set my hand and caused the Great Seal of the State of Oklahoma to be affixed at Oklahoma City, on January 5, 2021. (Emphasis in original.) (Full name appears in original, rather than initials 4 Title 22 O.S. Supp. 2019 §18, see note 1, supra. 5 Title 22 O.S. Supp. 1987 §18. Section 19, also enacted in 1987, corresponded with §18, describing the procedure for the district courts to follow for expungement. Title 19 O.S. Supp. 1987 §19 provided in part: §19. Procedure for Sealing Records A. Any person qualified under Section 18 of Title 22 of the Oklahoma Statutes may petition the district court of the district in which the arrest information pertaining to him is located for the sealing of all or any part of said record, except basic identification information. B. Upon the filing of a petition or entering of a court order, the court shall set a date for a hearing, which hearing may be closed at the court's discretion, and shall provide thirty (30) days of notice of the hearing to the district attorney, the arresting agency, the Oklahoma State Bureau of Investigation, and any other person or agency whom the court has reason to believe may have relevant information related to the sealing of such record. C. Upon a finding that the harm to privacy of the person in interest or dangers of unwarranted adverse consequences outweigh the public interest in retaining the records, the court may order such records, or any part thereof except basic identification information, to be sealed. If the court finds that neither sealing of the records nor maintaining of the records unsealed by the agency would serve the ends of justice, the court may enter an appropriate order limiting access to such records. Any order entered under this subsection shall specify those agencies to which such order shall apply. D. Upon the entry of an order to seal the records, or any part thereof, the subject official actions shall be deemed never to have occurred, and the person in interest and all criminal justice agencies may properly reply, upon any inquiry in the matter, that no such action ever occurred and that no such record exists with respect to such person. . . Section 19 has been amended four times since enactment, but the quoted portions above remain the same with the exception of the following language added in 2002 at the end of subsection C: Any order entered under this subsection shall specify those agencies to which such order shall apply. Any order entered pursuant to this subsection may be appealed by the petitioner, the district attorney, the arresting agency, or the Oklahoma State Bureau of Investigation to the Oklahoma Supreme Court in accordance with the rules of the Oklahoma Supreme Court. In all such appeals, the Oklahoma State Bureau of Investigation is a necessary party and must be given notice of the appellate proceedings. 6 Title 22 O.S. Supp. 1987 §19, see note 1, supra. 7 In re Adoption of Supreme Court Rules for Expungement of Records, 2005 OK 32, 120 P.3d 861 [Initially such appeals were to be lodged with the Oklahoma Court of Criminal Appeals.]; See discussion to the amendments of 22 O.S. Supp. 2002 §19, at note 5, supra. 8 Title 22 O.S. Supp. 1992 §18. 9 The Okla. Const. art. 6, §10 provides: § 10. Reprieves, commutations, paroles and pardons. There is hereby created a Pardon and Parole Board to be composed of five members; three to be appointed by the Governor; one by the Chief Justice of the Supreme Court; one by the Presiding Judge of the Criminal Court of Appeals or its successor. . . . The Pardon and Parole Board by majority vote shall have the power and authority to grant parole for nonviolent offenses after conviction, upon such conditions and with such restrictions and limitations as the majority of the Pardon and Parole Board may deem proper or as may be required by law. . . . The Governor shall have the power to grant, after conviction and after favorable recommendation by a majority vote of the Pardon and Parole Board, commutations, pardons and paroles for all offenses, except cases of impeachment, upon such conditions and with such restrictions and limitations as the Governor may deem proper, subject to such regulations as may be prescribed by law. Provided, the Governor shall not have the power to grant paroles if a person has been sentenced to death or sentenced to life imprisonment without parole. The Legislature shall have the authority to prescribe a minimum mandatory period of confinement which must be served by a person prior to being eligible to be considered for parole. The Governor shall have power to grant after conviction, reprieves or leaves of absence not to exceed sixty (60) days, without the action of the Pardon and Parole Board. . . . 10 Title 22 O.S. Supp. 2019 §18 provides in its entirety: A. Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories: 1. The person has been acquitted; 2. The conviction was reversed with instructions to dismiss by an appellate court of competent jurisdiction, or an appellate court of competent jurisdiction reversed the conviction and the prosecuting agency subsequently dismissed the charge; 3. The factual innocence of the person was established by the use of deoxyribonucleic acid (DNA) evidence subsequent to conviction, including a person who has been released from prison at the time innocence was established; 4. The person has received a full pardon by the Governor for the crime for which the person was sentenced; 5. The person was arrested and no charges of any type, including charges for an offense different than that for which the person was originally arrested, are filed and the statute of limitations has expired or the prosecuting agency has declined to file charges; 6. The person was under eighteen (18) years of age at the time the offense was committed and the person has received a full pardon for the offense; 7. The person was charged with one or more misdemeanor or felony crimes, all charges have been dismissed, the person has never been convicted of a felony, no misdemeanor or felony charges are pending against the person and the statute of limitations for refiling the charge or charges has expired or the prosecuting agency confirms that the charge or charges will not be refiled; provided, however, this category shall not apply to charges that have been dismissed following the completion of a deferred judgment or delayed sentence; 8. The person was charged with a misdemeanor, the charge was dismissed following the successful completion of a deferred judgment or delayed sentence, the person has never been convicted of a felony, no misdemeanor or felony charges are pending against the person and at least one (1) year has passed since the charge was dismissed; 9. The person was charged with a nonviolent felony offense not listed in Section 571 of Title 57 of the Oklahoma Statutes, the charge was dismissed following the successful completion of a deferred judgment or delayed sentence, the person has never been convicted of a felony, no misdemeanor or felony charges are pending against the person and at least five (5) years have passed since the charge was dismissed; 10. The person was convicted of a misdemeanor offense, the person was sentenced to a fine of less than Five Hundred One Dollars ($501.00) without a term of imprisonment or a suspended sentence, the fine has been paid or satisfied by time served in lieu of the fine, the person has not been convicted of a felony and no felony or misdemeanor charges are pending against the person; 11. The person was convicted of a misdemeanor offense, the person was sentenced to a term of imprisonment, a suspended sentence or a fine in an amount greater than Five Hundred Dollars ($500.00), the person has not been convicted of a felony, no felony or misdemeanor charges are pending against the person and at least five (5) years have passed since the end of the last misdemeanor sentence; 12. The person was convicted of a nonviolent felony offense not listed in Section 571 of Title 57 of the Oklahoma Statutes, the person has not been convicted of any other felony, the person has not been convicted of a separate misdemeanor in the last seven (7) years, no felony or misdemeanor charges are pending against the person and at least five (5) years have passed since the completion of the sentence for the felony conviction; 13. The person was convicted of not more than two felony offenses, none of which is a felony offense listed in Section 13.1 of Title 21 of the Oklahoma Statutes or any offense that would require the person to register pursuant to the provisions of the Sex Offenders Registration Act, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the completion of the sentence for the felony conviction; 14. The person has been charged or arrested or is the subject of an arrest warrant for a crime that was committed by another person who has appropriated or used the person's name or other identification without the person's consent or authorization; or 15. The person was convicted of a nonviolent felony offense not listed in Section 571 of Title 57 of the Oklahoma Statutes which was subsequently reclassified as a misdemeanor under Oklahoma law, the person is not currently serving a sentence for a crime in this state or another state, at least thirty (30) days have passed since the completion or commutation of the sentence for the crime that was reclassified as a misdemeanor, any restitution ordered by the court to be paid by the person has been satisfied in full, and any treatment program ordered by the court has been successfully completed by the person, including any person who failed a treatment program which resulted in an accelerated or revoked sentence that has since been successfully completed by the person or the person can show successful completion of a treatment program at a later date. Persons seeking an expungement of records under the provisions of this paragraph may utilize the expungement forms provided in Section 2 of this act. (Emphasis supplied.) 11 In D.A. v. State ex rel. Oklahoma State Bureau of Investigation, 2018 OK 102, 433 P.3d 727, we held that a drug court's dismissal following successful conclusion of the drug court program is not excluded from expungement under 22 O.S. Supp. 2016 §18 and may be expunged immediately, after successful completion of the program and the charges have been dismissed. 12 Holder was convicted of the following crimes: burglary of an automobile - February 14, 1986 (CRF-86-72); unlawful delivery of marijuana - July 18, 1986 (CRF-86-700); indecent exposure - July 18, 1986 (CRF-86-717); and possession of controlled dangerous substance (CDS) with intent to distribute, possession of marijuana, and maintaining a vehicle in which CDS was kept - June 17, 1991 (CRF-91-398). 13 Title 22 O.S. 2001 §14 and the 2014 version of the statute were not significantly different insofar as the cause was concerned. Title 22 O.S. Supp. 2014 §18 provided: Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories: 1. The person has been acquitted; 2. The conviction was reversed with instructions to dismiss by an appellate court of competent jurisdiction, or an appellate court of competent jurisdiction reversed the conviction and the district attorney subsequently dismissed the charge; 3. The factual innocence of the person was established by the use of deoxyribonucleic acid (DNA) evidence subsequent to conviction; 4. The person was arrested and no charges of any type, including charges for an offense different than that for which the person was originally arrested are filed or charges are dismissed within one (1) year of the arrest, or all charges are dismissed on the merits; 5. The statute of limitations on the offense had expired and no charges were filed; 6. The person was under eighteen (18) years of age at the time the offense was committed and the person has received a full pardon for the offense; 7. The offense was a misdemeanor, the person has not been convicted of any other misdemeanor or felony, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the judgment was entered; 8. The offense was a nonviolent felony, as defined in Section 571 of Title 57 of the Oklahoma Statutes, the person has received a full pardon for the offense, the person has not been convicted of any other misdemeanor or felony, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the conviction; or 9. The person has been charged or arrested or is the subject of an arrest warrant for a crime that was committed by another person who has appropriated or used the person's name or other identification without the person's consent or authorization. For purposes of this act, "expungement" shall mean the sealing of criminal records. Records expunged pursuant to paragraph 9 of this section shall be sealed to the public but not to law enforcement agencies for law enforcement purposes. The 2001 version, 22 O.S. 2001 §18 provided: Persons authorized to file a motion for expungement, as provided herein, must be within one of the following categories: 1. The person has been acquitted; 2. The conviction was reversed with instructions to dismiss by an appellate court of competent jurisdiction, or an appellate court of competent jurisdiction reversed the conviction and the district attorney subsequently dismissed the charge; 3. The person was arrested and no charges are filed or charges are dismissed within one (1) year of the arrest; 4. The statute of limitations on the offense had expired and no charges were filed; 5. The person was under eighteen (18) years of age at the time the offense was committed and the person has received a full pardon for the offense; 6. The offense was a misdemeanor, the person has not been convicted of any other misdemeanor or felony, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the judgment was entered; or 7. The offense was a nonviolent felony, as defined in Section 571 of Title 57 of the Oklahoma Statutes, the person has received a full pardon for the offense, the person has not been convicted of any other misdemeanor or felony, no felony or misdemeanor charges are pending against the person, and at least ten (10) years have passed since the conviction. For purposes of this act, "expungement" shall mean the sealing of criminal records. 14 Title 22 O.S. 2001 §18(5), see note 13, supra and 22 O.S. Supp. 2004 §18(6), see note 13, supra. 15 Title 22 O.S. 2001 §18(7), see note 13, supra and 22 O.S. Supp. 2004 §18(8), see note 13, supra. 16 Jones v. State ex rel. Office of Juvenile Affairs, 2011 OK 105, ¶ 15, 268 P.3d 72; King v. King, 2005 OK 4, ¶ 22, 107 P.3d 570; Haggard v. Haggard, 1998 OK 124, ¶ 1, 975 P.2d 439. 17 Title 22 O.S. Supp.2019 §18, see note 1, supra. 18 Title 22 O.S. Supp.2019 §18, see page 8, supra. 19 Title 22 O.S. Supp.2019 §18, see page 8, supra. 20 Title 22 O.S. Supp.2019 §18, see page 8, supra. 21 Title 12 O.S. 2011 §978 provides: When a judgment or final order is reversed, the plaintiff in error shall recover his costs, including the costs of the transcript of the proceedings, or case-made, filed with the petition in error; and when reversed in part and affirmed in part, costs shall be equally divided between the parties. 22 Title 12 O.S. 2011 App.1, Okla. Sup. Ct. R. 1.14 provides in pertinent part: (A) Costs. (1.) Costs must be sought by a separately filed and labeled motion in the appellate court prior to mandate being issued. The Clerk shall not tax as costs any expense unless the person claiming the same, prior to the issuance of a mandate in the cause, shall file with the Clerk a verified statement of taxable cost items showing that person has paid the same. (2.) Costs taxable by the Supreme Court Clerk are limited to the following: (a.) The cost deposit required by 20 O.S. §15; (b.) The cost deposit required by 20 O.S. §30.4; (c.) The reasonable cost of copying and binding the record pursuant to Rule 1.36. Carroll v. Axelson, Inc., 1999 OK 13, 976 P.2d 1046; (d.) Reasonable costs for transcripts which are a part of the record on appeal. These costs may include the fee for recording and transcribing the proceedings, and mileage if the trial judge requires the parties to bring their own court reporter. Any charges for mailing and delivery of copies, or for an additional electronic transcript, are not taxable. (3.) No fee paid to the district court clerk is taxable in the appellate courts. . . . 23 Title 12 O.S. 2011 §978 see note 21, supra; Title 12 O.S. 2011 App.1, Okla. Sup. Ct. R. 1.14 see note 22, supra; Title 12 O.S. 2011 §66 provides: A. Whenever an action is filed in any of the courts of this state where the State of Oklahoma or any of its departments or agencies, as defined in Section 152 of Title 51 of the Oklahoma Statutes, is a party, no bonds or other obligation of security shall be required from the state or from any party acting under the direction of the state, either to prosecute, answer, or appeal the action. The execution of a judgment or final order of any judicial tribunal against the state or any of its departments or agencies is automatically stayed without the execution of a supersedeas bond until any appeal of such judgment or final order has finally been determined. In case of an adverse decision, such costs as by law are taxable against the state, or against the party acting by its direction, shall be paid out of the funds of the department under whose direction the proceedings were instituted or defended. B. Costs shall be paid to the court fund of the district court in which an action is filed from the first funds collected in satisfaction of any judgment obtained by this state or any party acting under the direction of this state, except when the funds are collected pursuant to a child support order, judgment, or pursuant to any civil forfeiture action. No action filed by this state or by any party acting under the direction of this state shall be dismissed with unpaid costs of the action without the prior notification of the district court clerk of the county in which the action was filed. State ex rel. State Insurance Fund v. JOA, Inc., 2003 OK 82, ¶14, 78 P.3d 534 [ Section 66 provides for payment of costs from the funds of the State entity (department) appearing as a party to the action when the costs are taxable against the State upon an adverse decision.]. 24 Title 22 O.S. Supp.2019 §18, see note 10, supra. 25 Title 22 O.S. Supp.2019 §18, see note 10, supra.

91a477df-7e47-4fc7-8115-b2da71586a94

Kamphaus v. Town of Granite

oklahoma

Oklahoma Supreme Court

KAMPHAUS v. TOWN OF GRANITE2022 OK 46Case Number: 118984Decided: 05/17/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TORI KAMPHAUS, Individually and as Mother and Next Friend of D.W., a minor, Plaintiff/Appellant, v. TOWN OF GRANITE, Defendant/Appellee, ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 The mother of a child injured while visiting a cemetery when a headstone fell sued the Town of Granite, the operator of the cemetery, for negligence. The district court granted Town's motion for summary judgment, holding that Town did not owe a duty to the child. The mother appealed. The Oklahoma Court of Civil Appeals reversed the district court's judgment, holding Town owed a duty to the child regarding dangerous defects. This Court granted certiorari. We hold Town did not own or control the headstone and therefore owed no duty to the child regarding the maintenance of the headstone. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT AFFIRMED. Kelly A. George and James A. Scimeca, Burch George Germany, Oklahoma City, Oklahoma, for Plaintiff/Appellant. Timothy Prentice, Roberson, Kolker, Cooper & Goeres, Edmond, Oklahoma, for Defendant/Appellee. Winchester, J. ¶1 Appellant Tori Kamphaus (Mother), individually and as mother and next friend of D.W. (Son), a minor, appeals a summary judgment in favor of Appellee Town of Granite (Town). Son was injured while visiting a cemetery operated by Town when a headstone fell on him. The issue before this Court is whether Town owed Son a duty to maintain or inspect the headstone at issue. We answer this question in the negative. Town did not own or control the headstone that caused Son's injuries and therefore did not owe any duty to Son regarding the maintenance or inspection of the headstone. FACTS AND PROCEDURAL HISTORY ¶2 Town operates the Granite Town Cemetery as a benefit to the community. Town sells cemetery plots to individuals who are responsible for the burial of their decedents. Those individuals also purchase and are responsible for the placement of the monuments and headstones on the cemetery plots. ¶3 Mother and Son attended a funeral at the Granite Town Cemetery. During their visit, Son played near the graves of Amanda Bryan and James Bryan. Ms. Bryan was interred in 1918, and Mr. Bryan was interred in 1927. Son came in contact with the Bryans' headstone, and the headstone fell over, injuring Son. ¶4 Mother brought this action on behalf of herself and Son against Town for negligence in maintaining the cemetery. Town filed a motion for summary judgment. The district court granted Town's motion, holding that Town had no duty to inspect or maintain the headstone because Town did not own the headstone. It also held that Town had no notice that the headstone at issue was unsafe or posed a danger. The district court further reasoned that even if Town owed Mother and Son a duty of care, Town was immune from liability pursuant to the Oklahoma Governmental Tort Claims Act (GTCA), 51 O.S.2021, ch. 5, §§ 151-172, https://govt.westlaw.com/okjc. Mother appealed. ¶5 The Court of Civil Appeals (COCA) reversed the district court's judgment. COCA held that Town retained some aspect of ownership of the plot even after its transfer to the Bryans. COCA determined that the Legislature did not abrogate Town's tort liability when it authorized Town to enact ordinances regulating the operation of the cemetery and Town could not delegate the duty imposed on it regarding dangerous defects in the cemetery. This Court granted certiorari. ¶6 We hold Town owed no duty to Son with regard to the headstone placed on the Bryans' cemetery plot. Town did not own the headstone belonging to the Bryans and therefore had no duty to maintain or inspect it. To hold otherwise would impose a duty on Town (and other publicly owned cemeteries) to maintain every headstone installed in a cemetery into perpetuity. We affirm the district court's judgment. STANDARD OF REVIEW ¶7 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the trial court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. All inferences and conclusions are to be drawn from the underlying facts contained in the record and are to be considered in the light most favorable to the party opposing the summary judgment. U.S. Bank, 2012 OK 43, ¶ 13, 280 P.3d at 939. If reasonable individuals could reach different factual conclusions under the evidentiary materials, summary judgment is improper. Id. DISCUSSION ¶8 To succeed on her negligence claim against Town, Mother must prove that (1) Town owed Son a duty to maintain or inspect the headstone at issue, (2) Town breached that duty, and (3) the breach caused Son's injuries. The threshold question in any negligence case is the existence of a duty, which is a question of law. Miller v. David Grace, Inc., 2009 OK 49, ¶ 11, 212 P.3d 1223, 1227. I. Town had no duty to maintain the headstone. ¶9 Our prior opinions establish that a landowner's duty is to exercise reasonable care to keep a premises in a reasonably safe condition and to warn of conditions that are hidden dangers, traps, snares, or pitfalls. Martin v. Aramark Servs., Inc., 2004 OK 38, ¶ 5, 92 P.3d 96, 97. Cemeteries are different from normal businesses held open to the public; the distinction between businesses and cemeteries is the property interests associated with purchasing a cemetery plot and placing a headstone or other monument on the plot. See 14 Am. Jur. 2d Cemeteries § 31 (2022). ¶10 The general rule is that an interest in a cemetery plot is somewhat unique in that a purchaser does not acquire a fee simple interest in the plot. Id. Therefore, no formal deed is necessary to confer the exclusive right to use a cemetery plot and be free from invasion by those who would disturb possession. Question Submitted by: The Honorable Rex Duncan, State Representative, Dist. 35, 2008 OK AG 34, ¶ 2. A purchaser of a cemetery plot instead acquires an interest akin to an easement. Id. ¶ 2. The interest in the plot vests in the original purchaser's heirs at law. Id. ¶ 9; see also 14 Am. Jur. 2d Cemeteries § 31 (2022). If the cemetery plot is abandoned, only then does it revert to the municipality. 11 O.S.2021, ch. 1, art. XXVI, § 26-103, https://govt.westlaw.com/okjc (in ch. 1, follow hyperlink titled, "Municipal Departments and Services"); see also Heiligman v. Chambers, 1959 OK 58, ¶¶ 12-13, 338 P.2d 144, 148 (adopting the rule that a plot is abandoned by not merely failing to maintain the plot or headstone but by removal of the body from the plot). ¶11 The headstone or monument is normally the property of the purchaser of the cemetery plot. See, e.g., Brock v. Richmond-Berea Cemetery Dist., 957 P.2d 505, 510 (Kan. 1998) (noting that the gravestone was not the property of the cemetery). The estate, the families of the deceased, or other parties purchase and place the headstones or other memorial markers on the easement. The headstones or monuments also remain the property of the purchasers or their heirs unless the easements on which the headstones are placed revert back to the cemetery upon abandonment of the plots. See Heiligman, 1959 OK 58, ¶¶ 12-13, 338 P.2d at 148. ¶12 At common law, the obligation to maintain an easement (or a structure built on an easement) was placed on the easement holder, absent an agreement to the contrary. Restatement (First) of Property § 485 (1944).1 The owner of the easement was also liable for injuries suffered by third parties in an easement area owing to the easement owner's negligence. Id. The majority of jurisdictions have upheld that the duty to maintain an easement belongs to the easement holder.2 The most common cases where courts have upheld this duty are in cases involving utility easements, right-of-way easements, or structures built on easements; the owner of the easement was held responsible for maintaining the easement or the structure built on the easement and not the landowner. See supra note 2. ¶13 The duty of an easement holder to maintain a structure built on an easement parallels the duty of the purchaser of a cemetery plot to maintain a headstone placed on the plot. The Kentucky Supreme Court explained this concept in City of Versailles v. Johnson, 636 S.W.3d 480, 484 (Ky. 2021) (noting a cemetery plot conferred different duties depending on whether the monument was implicated). The Johnson court affirmed summary judgment for the city, holding the city-owned cemetery did not owe a duty to a plaintiff injured by a fallen headstone that the cemetery did not own. Id. The court explained that the plaintiff was not harmed by anything under the cemetery's control, like a pathway in disrepair or a fallen tree or other debris. Id. Instead, she was injured by a headstone owned by the purchaser of the cemetery plot. The Kentucky Supreme Court concluded that the city did not owe the plaintiff a duty. Id. We agree with the Johnson court's analysis. ¶14 Town only provided routine maintenance to the common areas of the cemetery (such as roadways, fences, and shrubbery) and mowing services. Although Town operated the cemetery and provided such services, Town had no property interest in the headstone placed on an easement belonging to the Bryans. Consequently, Town owed no duty in maintaining the headstone. See, e.g., Brock, 957 P.2d at 510 (noting that the gravestone was not the property of the cemetery although the cemetery accepted some duties concerning the maintenance and inspection of the gravestone); Melancon v. Zoar Missionary Baptist Church, 222 So. 2d 308, 310 (La. 1969) (finding the owner was not responsible for maintaining the headstone that injured a child, although the owner performed groundskeeping duties on the premises). ¶15 Town was not statutorily required to maintain the headstone. The Oklahoma Legislature required Town to provide the "grading, fencing, ornamenting, and improving" of the cemetery grounds acquired by Town and the avenues leading to the cemetery. 11 O.S.2021, ch. 1, art. XXVI, § 26-102, https://govt.westlaw.com/okjc. The Legislature gave the discretion to Town to construct walks and to plant and protect ornamental trees and shrubs. Id. The Legislature also gave Town authority to enact its own ordinances to regulate, protect, and govern the cemetery and the owners of the cemetery plots, including enacting ordinances for the establishment of monuments and headstones. 11 O.S.2021, ch. 1, art. XXVI, § 26-105, https://govt.westlaw.com/okjc. Town enacted an ordinance regarding the maintenance of headstones. Specifically, Ordinance § 91.2 states: It shall be the duty of the proprietor or owners of the lots to keep in repair permanent markers, stones, and memorials in the boundaries of their lots. Granite, Okla., Cemeteries Ordinances § 91.2. Town's responsibilities included groundskeeping and ensuring that visitors could safely travel through the common areas of the cemetery. However, Town had no property interest in the headstone placed on the easement belonging to the purchaser of the plot and no duty to maintain it. Town's duties were limited to those common areas that it was responsible to maintain. ¶16 Son was injured while playing on or around the headstone that was not owned or placed by Town, and Town did not owe a duty to Son to maintain the headstone at issue. Furthermore, to impose a continuous duty on Town to maintain every single headstone in the cemetery is a tremendous burden, especially when the headstones or monuments are not Town's property. We refuse to impose such a duty on Town. II. Town had no duty to inspect the headstone. ¶17 Town argues that it is statutorily exempt under the GTCA from liability pursuant to 51 O.S.2021, ch. 5, § 155(13), https://govt.westlaw.com/okjc,3 for any alleged failure to inspect the headstone. A state entity, like Town, is liable for loss resulting from its torts or the torts of employees committed within the scope of employment. 51 O.S.2021, ch. 5, § 153(A), https://govt.westlaw.com/okjc. Governmental immunity of a state entity is waived only to the extent and in the manner provided in the GTCA. 51 O.S.2021, ch. 5, § 152.1(B), https://govt.westlaw.com/okjc. ¶18 The exemption relied upon by Town in this matter is that a state entity is not liable for any loss that occurs when using its inspection powers. 51 O.S.2021, ch. 5, § 155(13), https://govt.westlaw.com/okjc. Although rejected by this Court in Moran v. City of Del City, Town appears to argue that inspecting the headstone to determine if it needed repair constitutes an inspection function covered by § 155(13). 2003 OK 57, ¶ 15, 77 P.3d 588, 594. In Moran, we interpreted § 155(13) to describe the exercise of a particular governmental "power" or "function" and not a simple familiarization with one's property. Id. Because no governmental inspection power or function is at issue in this case, we conclude that § 155(13) is not applicable. ¶19 This, however, does not end our analysis. Town is seeking protection from its alleged failure to acquire knowledge of whether the headstone needed repairs. We have said that performing maintenance is different from inspecting, as an inspection is tied to a person's duty to discover facts. Moran, 2003 OK 57, ¶ 10, 77 P.3d at 592. For example, Mother relies on McCathern v. City of Okla. City, 2004 OK 61, ¶ 13, 95 P.3d 1090, 1096, to argue that regardless of its duty to maintain the headstone, Town had a duty to inspect and obtain knowledge of the condition of the headstone. The McCathern case involved an injury that occurred when the plaintiff tripped on a raised sprinkler head placed by the defendant city at the edge of a sidewalk. Id. ¶ 2, 95 P.3d at 1092. We found that there was a duty to remedy the raised sprinkler head when the condition existed for a sufficient length of time that the defect ought to have been discovered. Id. ¶ 13, 95 P.3d at 1096. The McCathern case is distinguishable from this matter. The alleged defect--the headstone--was not placed by Town near a walkway belonging to Town. Rather, the headstone was placed on the easement belonging to the purchaser of the cemetery plot. This matter is also not as in Moran wherein we noted that the defendant could be held responsible for an injury that occurred for not acquiring knowledge of the condition of its uncovered sewer manhole; the headstone at issue did not belong to Town. 2003 OK 57, ¶ 10, 77 P.3d at 592. Even more, unlike in McCathern and Moran, the record before us fails to establish that any defect in the headstone was known by Town or would have been discovered by Town upon inspection. ¶20 Whether Town was exempt from liability under § 155(13) of the GTCA is not determinative of whether Town had a duty to inspect the headstone. Instead, Town had no duty to inspect the headstone because it was not owned, placed, or controlled by Town. CONCLUSION ¶21 Town did not assume to care for or maintain the headstone that fell on Son. Imposing upon Town the duty of ensuring the stability and safety of every headstone in a cemetery, in effect, compels Town to maintain a structure it never owned or controlled. See, e.g., Nesterovich v. Mt. Olivet Cemetery, 208 N.Y.S. 609, 613 (N.Y. App. Div. 1925). Because Town did not own the headstone, we hold Town did not have a duty to maintain it. Accordingly, we vacate COCA's opinion and affirm the district court's judgment. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT AFFIRMED. ALL JUSTICES CONCUR. FOOTNOTES 1 See Fowler v. Lincoln Cty. Conservation Dist., 2000 OK 96, 15 P.3d 502 (affirming the conservation district's duty to maintain its easement); see also Smith v. Muellner, 932 A.2d 382, 393 (Conn. 2007) (holding the servient owner had no duty to keep a right-of-way clear by removing trees and natural vegetation); Flower v. Valentine, 482 N.E.2d 682, 687 (Ill. App. Ct. 1985) (noting that "the servient tenement has no duty to either put or keep the easement in repair"); Baker v. Hines, 406 S.W.3d 21, 28 (Ky. Ct. App. 2013) (noting that the owner of a servient estate was ordinarily under no obligation to repair or maintain an easement); Annin v. Lake Montowese Dev. Co., Inc., 759 S.W.2d 240, 241-42 (Mo. Ct. App. 1988) (noting that the owner of a lake, the servient estate, had no obligation to repair a dam); Encompass Ins. Co. of Am. v. Long Island Power Auth., 10 N.Y.S.3d 110, 111 (N.Y. App. Div. 2015) (holding that the servient owner had no duty to trim the bamboo vegetation around the power line); Hayes v. Tompkins, 337 S.E.2d 888, 891 (S.C. Ct. App. 1985) (declaring that the owners of the servient tenement were under no duty to repair an easement in the absence of an agreement); Hixson v. Am. Towers, LLC, 593 S.W.3d 699, 713-14 (Tenn. Ct. App. 2019) (holding that the servient owners have no duty to maintain the surrounding hillside for the benefit of the cell tower). 2 See, e.g., Sutera v. Go Jokir, Inc., 86 F.3d 298, 303-08 (2d Cir. 1996) (discussing the tort liability of an easement holder and finding the easement holder liable for an injury suffered by a third party); Greiner v. Columbia Gas Transmission Corp., 41 F. Supp. 2d 625 (S.D. W. Va. 1999) (discussing the liability of an easement holder for injuries caused by the lack of maintenance); Clark v. New Magma Irrigation & Drainage Dist., 92 P.3d 876, 879-81 (Az. Ct. App. 2004) (examining the tort liability of an easement holder and concluding that the easement holder had no duty to warn about the conditions on the servient estate unrelated to its use of property); McDermott v. Metro. Sanitary Dist., 607 N.E.2d 1271, 1285-86 (Ill. App. Ct. 1992) (imposing tort liability for personal injury upon the holder of a drainage ditch easement); Bala v. City of Indianapolis, 682 N.E.2d 573, 575-76 (Ind. Ct. App. 1997) (imposing tort liability on a utility easement holder); Wagner v. Doehring, 553 A.2d 684, 687-89 (Md. 1989) (discussing the duty of easement holders to a third party and concluding that the holder could be held liable for an injury to a trespasser only for willful conduct); Morrow v. Boldt, 512 N.W.2d 83, 86 (Mich. Ct. App. 1994) (finding that "it is the owner of an easement, rather than the owner of the servient estate, who has the duty to maintain the easement in a safe condition so as to prevent injuries to third parties"); Kibbons v. Union Elec. Co., 823 S.W.2d 485, 488 (Mo. 1992) (holding the servient owner had no liability for any injury resulting from devices placed on an easement that were under the sole control of the holder of a utility easement); Washington v. Qwest Commc'ns Corp., 704 N.W.2d 542, 547-48 (Neb. 2005) (finding that the holder of a utility easement controlled the premises and remanding the case to determine whether the easement holder was liable for injuries caused by negligence); Morgan v. Chong Kwan Jun, 817 N.Y.S.2d 325, 327 (N.Y. App. Div. 2006) (discussing the tort liability of an easement holder for an injury in a parking lot); Green v. Duke Power Co., 290 S.E.2d 593, 598 (N.C. 1982) (holding that when the character of the easement is such that failure to keep it in repair may result in injury to third persons, the owner of the easement may be liable for such injury); Slogowski v. Lyness, 927 P.2d 587, 590-91 (Or. 1996) (holding that a complaint alleging that a utility easement holder had a duty to remove hazardous trees along a right-of-way stated cause of action in a personal injury case); Musch v. H-D Elec. Coop., Inc., 460 N.W.2d 149, 152-54 (S.D. 1990) (discussing the liability of a utility easement holder for personal injury on a right-of-way and holding that the easement holder must exercise reasonable care to protect travelers). 3 Section 155(13) states: The state or a political subdivision shall not be liable if a loss or claim results from: . . . 13. Inspection powers or functions, including failure to make an inspection, review or approval, or making an inadequate or negligent inspection, review or approval of any property, real or personal, to determine whether the property complies with or violates any law or contains a hazard to health or safety, or fails to conform to a recognized standard.

1d87e5d2-2e06-4360-871d-86b009b2ba86

Friend v. Friend

oklahoma

Oklahoma Supreme Court

FRIEND v. FRIEND2022 OK 29Case Number: 118339Decided: 03/22/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. BRIAN RAY FRIEND, Petitioner/Appellant, v. KIRSTEN DENISE FRIEND, Respondent/Appellee. ¶0 Appellant Brian Friend appealed a decision from the trial court granting Appellee Kirsten Friend attorney fees. The Court of Civil Appeals, Division 1, affirmed the trial court. The Court of Civil Appeals denied Appellee's subsequent request for appeal-related attorney fees. We granted Appellee's petition for writ of certiorari. We hold that, where a prevailing party is entitled to attorney fees below, they are also entitled to appellate attorney fees; where an award of attorney fees is within the trial court's discretion, a prevailing party may be granted appellate attorney fees. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; CASE REMANDED TO TRIAL COURT Marianne Miller, The Parsons Law Firm, P.L.L.C., Shawnee, Oklahoma, for Petitioner/Appellant Jerry L. Colclazier, Colclazier & Associates, Seminole, OK, for Respondent/Appellee KUEHN, J.: ¶1 This case arises from a longstanding custody and child support dispute. The issue before the Court involves the appropriateness of appellate attorney fees. We reaffirm our previous holding that a prevailing party who is entitled to attorney fees in the district court is also entitled to recover appellate attorney fees. Ellis v. Lebowitz, 1990 OK 107, ¶ 4, 799 P.2d 620, 621. Procedural History ¶2 The underlying facts of the case are not necessary to resolve the issue. Procedurally, after an initial determination of child support and custody, Appellee Kirsten Friend (Mother) sought to modify the child support order and applied to find Appellant Brian Friend (Father) in contempt, claiming he had not paid child support for several months. The Seminole County District Court granted Mother's motions. The trial court found Father in indirect contempt and increased the child support payment. Mother asked for attorney fees and costs, dividing the request into fees incurred for the request to modify child support and fees incurred for the contempt request. Father objected but conceded the only issue was whether Mother was legally entitled to the fees. The District Court awarded Mother $19,604.14 in attorney fees. ¶3 Father appealed only the attorney fees award. The Court of Civil Appeals, Division I (COCA) affirmed the award of attorney fees in an opinion not for publication. Mother filed a request for appellate attorney fees which was denied by a one-sentence order, and Mother then filed her petition for writ of certiorari. Standard of Review ¶4 Although COCA's decision does not distinguish between the two fee awards, this Court must. We review a decision denying attorney fees which are mandated by statute de novo. Ellis, 1990 OK 107, ¶ 4, 799 P.2d at 621.1 Where a statute permits an award of fees within the trial court's discretion, we review a decision for abuse of discretion, determining whether the court's conclusion is clearly erroneous and against reason and evidence. Boatman v. Boatman, 2017 OK 27, ¶ 16, 404 P.3d 822, 828; see also Thielenhaus v. Thielenhaus, 1995 OK 5, ¶ 19, 890 P.2d 925, 934-35 (fees awarded under 43 O.S. § 110). Mother is entitled to appellate attorney fees under 43 O.S. § 111.1(C)(3) ¶5 This Court has clearly stated that, where a statute mandates an award of attorney fees in the trial court, the prevailing party is also entitled to recover appellate attorney fees; this decision "is not discretionary." Ellis, 1990 OK 107, ¶ 4, 799 P.2d at 621. ¶6 Mother asked the trial court to hold Father in contempt for failure to pay child support pursuant to 43 O.S. §111.1(C)(1).2 When she prevailed, the trial court granted her attorney fees under 43 O.S. §111.1(C)(3). If the terms of Section 111.1(C) are met, attorney fees are mandatory: "Unless good cause is shown for the noncompliance, the prevailing party shall be entitled to recover court costs and attorney fees expended in enforcing the order and any other reasonable costs and expenses incurred in connection with the denied child support or denied visitation as authorized by the court." 43 O.S. §111.1(C)(3) (emphasis added). Here, the trial court found Father in indirect contempt, because Father had no good cause for his failure to pay. Thus, Mother was entitled to attorney fees connected with the action for contempt, and under Section 111.1(C)(3) the trial court did not have discretion to refuse her request. ¶7 COCA's summary denial of Mother's request for appeal-related attorney fees under Section 111.1(C)(3) directly conflicts with Ellis. Well after Ellis was decided in 1990, COCA determined in Winkler that, although the prevailing party below was entitled to attorney fees mandated by statute, the award of appellate attorney fees was discretionary. Winkler v. Solutions Group, Inc., 1995 OK CIV APP 134, ¶ 10, 915 P.2d 386, 388. Without citing Ellis, COCA relied in Winkler on Sisney v. Smalley, 1984 OK 70, 690 P.2d 1048. In Sisney, we noted that, where a statute authorizes attorney fees for the prevailing party at trial, appellate attorney fees may be allowed. Id. ¶ 20, 690 P.2d at 1051. This is a general statement regarding the ability to recover appeal-related attorney fees. It neither conflicts with nor controls over the later, more specific ruling in Ellis. Neither Sisney nor subsequent cases repeating that language should be understood to say that an appeals court has discretion regarding an award of attorney fees, when under a particular statute the trial court does not. ¶8 Under 43 O.S. §111.1(C)(3), the trial court did not have discretion whether to award Mother attorney fees below. Thus, COCA had no discretion over whether to award appellate attorney fees upon Mother's request. Mother is entitled to appellate attorney fees under 43 O.S. § 110(D) ¶9 Mother also requested attorney fees under 43 O.S. §110(D).3 This statute provides that the trial court has discretion to require either party to pay reasonable expenses (including attorney fees) of the other party. The trial court exercised its discretion and based on the totality of the circumstances, awarded Mother attorney fees. ¶10 We have held that, where the issue involves an award of attorney fees below, a party who prevails on appeal "is entitled to recover for legal services rendered" on the appeal. State ex rel. Harris v. Three Hundred and Twenty Five Thousand and Eighty Dollars, 2021 OK 16, ¶ 25, 485 P.3d 242, 248. To determine whether Mother's request for appellate attorney fees under Section 110(D) was just and proper under the circumstances, the appellate court must engage in a judicial balancing of equities. Thielenhaus, 1995 OK 5, ¶ 19, 890 P.2d at 935. ¶11 However, the single sentence with which COCA denied Mother's request provides us no basis for determining whether COCA balanced the equities here. And as the order does not reflect an exercise of discretion, we are unable to review it for abuse of discretion. As COCA recognized, at the hearing before the trial court, Father's attorney explicitly did not contest the reasonableness of the fee request. Father's objections went to whether Mother was entitled to recover attorney fees at all, but not to the amount requested. Given this, COCA correctly found that the trial court's award was not an abuse of discretion. On the same record, we conclude that Mother was entitled to attorney fees under Section 110(D). ¶12 COCA's opinion is vacated. We remand the case to the trial court to determine the amount of appeal-related attorney fees. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; CASE REMANDED TO TRIAL COURT CONCUR: DARBY, C.J., WINCHESTER, EDMONDSON, COMBS, GURICH AND KUEHN, JJ. CONCUR IN PART/DISSENT IN PART: KANE, V.C.J. and KAUGER, J. KANE, V.C.J., concurring in part/dissenting in part: "I would not overrule the Court of Civil Appeals' discretionary denial of fees." DISSENT: ROWE, J. FOOTNOTES 1 This Court has used the abuse of discretion standard when reviewing claims of statutory entitlement that did not mandate a specific award of attorney fees, as a decision regarding attorney fees in these cases was ultimately within the trial court's discretion. See, e.g., TRW/Reda Pump v. Brewington, 1992 OK 31, ¶ 10 n.4, 829 P.2d 15, 21 n.4; Broadwater v. Courtney, 1991 OK 39, ¶ 6, 809 P.2d 1310, 1312. 2 "Violation of an order providing for the payment of child support or providing for the visitation of a noncustodial parent with any of the children of such noncustodial parent may be prosecuted as indirect civil contempt pursuant to Section 566 of Title 21 of the Oklahoma Statutes or as otherwise deemed appropriate by the court." 3 "Upon granting a decree of dissolution of marriage, annulment of a marriage, or legal separation, the court may require either party to pay such reasonable expenses of the other as may be just and proper under the circumstances."

b70c93a4-82a5-40b3-af92-b2df14409db3

Continental Resources v. Wolla Oilfield Services

oklahoma

Oklahoma Supreme Court

CONTINENTAL RESOURCES v. WOLLA OILFIELD SERVICES2022 OK 40Case Number: 120039Decided: 05/03/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CONTINENTAL RESOURCES, INC., Plaintiff, v. WOLLA OILFIELD SERVICES, LLC, Defendant. CERTIFIED QUESTION FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF OKLAHOMA ¶0 The United States District Court for the Western District of Oklahoma certified two questions of state law which have been addressed by this Court pursuant to the Revised Uniform Certification of Questions of Law Act, 20 O.S. 2021, §§ 1601-1611. CERTIFIED QUESTIONS ANSWERED Nicholas V. Merkley, GableGotwals, Oklahoma City, Oklahoma, for Plaintiff. Daniel G. Webber, Jr., Ryan Whaley, Coldiron Jantzen Peters & Webber, PLLC, Oklahoma City, Oklahoma, for Defendant. COMBS, J.: ¶1 The United States District Court for the Western District of Oklahoma (certifying court) certified two questions of state law to this Court under the Revised Uniform Certification of Questions of Law Act, 20 O.S. 2021, §§ 1601-1611.1 The questions certified are: (1) Does the Oklahoma Consumer Protection Act apply to conduct that physically occurs outside the state of Oklahoma? (2) Does the Oklahoma Consumer Protection Act apply to conduct where, even if the physical location is difficult to pinpoint, such actions or transactions have a material impact on, or material nexus to, a consumer in the state of Oklahoma? I. CERTIFIED FACTS AND PROCEDURAL HISTORY ¶2 The underlying facts in this cause are set out in the certification order from the Western District. In answering a certified question, the Court does not presume facts outside those offered by the certification order. Howard v. Zimmer, Inc., 2013 OK 17, n.5, 299 P.3d 463, 465 n.5; In re Harris, 2002 OK 35, ¶4 n.5, 49 P.3d 710, 713 n.5; Jones v. Univ. of Cent. Okla., 1995 OK 138, ¶5, 910 P.2d 987, 989. Although this Court will neither add nor delete such facts, we may consider uncontested facts supported by the record. Howard, 2013 OK 17, n.5, 299 P.3d at 456 n.5; McQueen, Rains, & Tresch, LLP v. CITGO Petroleum Corp., 2008 OK 66, n.4, 195 P.3d 35, 38 n.4; In re Harris, 2002 OK 35, ¶4, 49 P.3d at 713. In the present matter, the certifying court has determined the facts relevant to understanding the certified questions because the parties do not agree on all the material facts. See 20 O.S. 2021, § 1604 ("B. If the parties cannot agree upon a statement of facts, the certifying court must determine the relevant facts and state them as part of its certification order."). ¶3 The matter concerns a dispute between Continental Resources, Inc. (Continental), an oil and gas producer headquartered in Oklahoma, and Wolla Oilfield Services, LLC (Wolla), a North Dakota limited liability company that operates as a hot oil2 service provider in North Dakota. Continental alleges the parties entered into an agreement for Wolla to provide hot oil services at an hourly rate to Continental's wells in North Dakota. As part of the contract, Wolla agreed to submit its invoices through an "online billing system" and to bill accurately and comprehensively for work it performed. A whistleblower in Wolla's accounting department notified Continental about systematic overbilling in connection with this arrangement. Continental conducted an audit and concluded Wolla's employees were overbilling it for time worked and calculated the overbilling to be at least $2,400,000.00. Wolla denies these allegations. ¶4 On March 4, 2020, Continental sued Wolla in the United States District Court for the Western District of Oklahoma asserting, among other claims, a claim under the Oklahoma Consumer Protection Act (OCPA), 15 O.S. 2021, §§ 751 - 764. Wolla moved to dismiss, arguing that the transactions at issue (the alleged overbilling) occurred in North Dakota and that the OCPA does not have extraterritorial application, or, in the alternative, that a statute with such broad extraterritorial reach may implicate the dormant Commerce Clause of the U.S. Constitution.3 Continental asserts the transactions at issue qualify as occurring in Oklahoma, both because Wolla sent electronic invoices to Continental's headquarters in Oklahoma and because an out-of-state entity that directs harmful conduct towards someone in a particular state may be held to account in that state. The certifying court denied the motion to dismiss on July 9, 2021, but entered a Certification of Constitutional Question (Certification) on September 17, 2021, and the same was filed in this Court on November 30, 2021. ¶5 The certifying court found that Wolla correctly observed an extraterritorial application of the OCPA would raise concerns about the Act's constitutionality under the federal constitution. It noted, the Oklahoma Supreme Court has never adopted a presumption against extraterritorial application and has not yet had occasion to decide the territorial reach of the OCPA. Unlike consumer protection statutes of some sister states, the OCPA does not explicitly limit its consumer protection to conduct occurring within the state. The matter was certified to this Court because it found there was no controlling decision of the appellate courts in Oklahoma. The certifying court did note in Harvell v. Goodyear Tire & Rubber Co., 2006 OK 24, ¶23, 164 P.3d 1028, 1037, that this Court, when reviewing the applicability of the Ohio Consumer Sales Practices Act, determined "the focus of the inquiry concerning application of such an Act to out-of-state consumers is whether the offending consumer transaction occurred within the state." The certifying court found that the Harvell opinion suggests this Court would limit the OCPA's reach to transactions occurring within Oklahoma. II. PROCEDURE AND REQUIREMENTS FOR ANSWERING CERTIFIED QUESTIONS ¶6 Unresolved questions of law may be answered by this Court if certified questions are presented in accordance with the Revised Uniform Certification of Questions of Law Act, 20 O.S. 2021, §§ 1601-1611. Gov't Emps. Ins. Co. v. Quine, 2011 OK 88, ¶13, 264 P.3d 1245, 1248. This Court's examination of the certified question is confined to resolving questions of law, not facts. Russell v. Chase Inv. Servs. Corp., 2009 OK 22, ¶8, 212 P.3d 1178, 1181. In assessing whether a certified federal question of law should be answered by this Court, both factors mentioned in 20 O.S. 2021, § 1602 should be addressed: 1) Would the answer be dispositive of an issue in pending litigation in the certifying court? 2) Is there established and controlling law on the subject matter? Quine, 2011 OK 88, ¶13, 264 P.3d at 1248. Answering the certified questions here would be dispositive of a pending issue in the federal court, and there is no clear controlling precedent of this Court concerning the limits to the territorial reach of the OCPA. This Court also possesses discretionary authority to reformulate the question(s) certified. McQueen, Rains & Tresch, LLP, 2008 OK 66, ¶1 n.1, 195 P.3d at 37; Tyler v. Shelter Mut. Ins. Co., 2008 OK 9, ¶1 n.1, 184 P.3d 496, 496 n.1; McClure v. ConocoPhillips Co., 2006 OK 42, ¶1 n.1, 142 P.3d 390, 391 n.1. This authority is set out in 20 O.S. 2021, § 1602.1, which provides: "The Supreme Court of this state may reformulate a question of law certified to it." III. ANALYSIS ¶7 The purpose of the OCPA is to prohibit unlawful practices and conduct made in connection with a consumer transaction. Consumer protection acts are meant to regulate commerce which is infected with deceptive or unconscionable practices and are not meant to be general regulations of "clean" commerce. See Brown v. Mkt. Dev., Inc., 322 N.E.2d 367, 374 (Ohio Ct. Com. Pl. 1974) cited in Harvell, 2006 OK 24, ¶23 n.43, 164 P.3d at 1037 n.43. Under the OCPA a "consumer transaction" is defined as: [T]he advertising, offering for sale or purchase, sale, purchase, or distribution of any services or any property, tangible or intangible, real, personal, or mixed, or any other article, commodity, or thing of value wherever located, for purposes that are personal, household, or business oriented; 15 O.S. 2021, § 752(2). A person violates the Act when they commit an unfair or deceptive trade practice in the course of the person's business. 15 O.S. 2021, § 753(20). A "deceptive trade practice" is defined as: [A] misrepresentation, omission or other practice that has deceived or could reasonably be expected to deceive or mislead a person to the detriment of that person. Such a practice may occur before, during or after a consumer transaction is entered into and may be written or oral; 15 O.S. 2021, § 752(13) (emphasis added). From the very language of this definition it is clear that the focus of the inquiry concerning the application of the Act is on the offending conduct, which can occur "before, during or after a consumer transaction." However, it is not uncommon for the offending conduct to occur at the same time as the consumer transaction. In Harvell a customer was charged a deceptive shop fee at the time she brought her car in for repairs. We determined "in our view any unfair, deceptive or unconscionable conduct toward a consumer occurred where the transaction occurred--when a customer brought an automobile in for service to a service center and was charged a shop supply fee." Harvell, 2006 OK 24, ¶24, 164 P.3d at 1037. Both the consumer transaction and the offending conduct occurred in Oklahoma and therefore we found the Ohio Consumer Sales Practices Act was not applicable. Id. The reason we found the offending conduct occurred where the consumer transaction occurred was based on the particular facts of the case. We were not establishing a rule that the place where the consumer transaction occurs would always be deemed the place where the offending conduct occurs. Again, the focus is on the location of the offending conduct, e.g., where the deceptive trade practice occurs. The offending conduct is what triggers the Act, not otherwise lawful consumer transactions. Other courts are aligned with this interpretation. ¶8 In In re General Motors LLC Ignition Switch Litigation, 154 F. SupP.3d 30 (S.D.N.Y. 2015), the court denied the defendant's summary judgment claim that the OCPA was not applicable to a consumer transaction which occurred in Nevada. The court determined the OCPA "extends to any 'misrepresentation, omission or other practice that has deceived or could reasonably be expected to deceive or mislead' a consumer, and expressly provides that the challenged 'practice may occur before, during or after a consumer transaction is entered into.'" Id. at 47. The court found that "[p]laintiff's claim is not . . . based on his purchase of the car in Nevada; instead, it is based on [the defendant's] alleged misrepresentations, omissions, and other practices directed toward him in Oklahoma, where he resided." Id. In that case, the plaintiff received a vehicle recall notice in Oklahoma which allegedly omitted information concerning the dangers related to the recall. Similarly, in Goshen v. Mutual Life Insurance Co. of New York, 774 N.E.2d 1190 (N.Y. 2002), when determining the applicability of New York's consumer protection statutes, the New York Court of Appeals determined there is no fraudulent transaction until the deception occurred and therefore the location of the deception was the controlling factor. Id. at 1195-96; see also Avery v. State Farm Mut. Auto. Ins. Co., 835 N.E.2d 801, 853 (Ill. 2005). ¶9 In Avery the court agreed with Goshen that when dealing with misrepresentations there is no fraudulent transaction until the misrepresentation has been communicated. Avery, 835 N.E.2d at 853. However, the court also found it can be difficult to identify the location of a transaction when it is made up of components that occur in more than one state. In such a situation the court adopted a broader alternative than the one taken by the Goshen court. It determined there was "no single formula or bright-line test for determining whether a transaction occurs within [a] state." Id. Its solution was to find that "a fraudulent transaction may be said to take place within a state if the circumstances relating to the transaction occur primarily and substantially within that state." Id. ¶10 The first certified question is: (1) Does the Oklahoma Consumer Protection Act apply to conduct that physically occurs outside the state of Oklahoma? Having determined the location of the offending conduct, i.e., conduct that triggers a violation of the Act, is the focus of an inquiry into whether the OCPA is applicable to a particular matter, we reformulate the first certified question. The reformulated certified question is: (1) Does the Oklahoma Consumer Protection Act apply to a consumer transaction when the offending conduct that triggers the Act occurs solely within the physical boundaries of another state? We answer this reformulated question in the negative. ¶11 The second certified question is: (2) Does the Oklahoma Consumer Protection Act apply to conduct where, even if the physical location is difficult to pinpoint, such actions or transactions have a material impact on, or material nexus to, a consumer in the state of Oklahoma? As to this second certified question, we also answer in the negative. The mere fact that a transaction has a material impact on or nexus to a consumer in Oklahoma, without more, is not enough to invoke this state's consumer protection laws. The focus is on the location of the offending conduct, and such conduct must occur in this state. When the offending conduct is difficult to pinpoint, likely due to some conduct occurring in more than one state, we adopt the Avery court's approach. When the offending conduct occurs in more than one state, the applicable consumer protection law would be that of the state where the circumstances relating to the offending conduct primarily and substantially occur. To hold otherwise could raise the valid concerns voiced by the certifying court. The certifying court noted that the "normal presumption against extra-territorial application [of a state's statutes] would suggest that the OCPA cannot reach transactions occurring outside of the state." It found that this Court has never adopted a presumption against extraterritorial application, presumably in regards to the OCPA. The concern is based upon the federal constitution. The dormant Commerce Clause "precludes the application of a state statute to commerce that takes place wholly outside of the State's borders." Healy v. Beer Inst., Inc., 491 U.S. 324, 336 (1989). A statute may violate the dormant Commerce Clause if it has the practical effect of extraterritorial control of commerce occurring entirely outside of the boundaries of the state in question. KT & G Corp v. Att'y Gen., 535 F.3d 1114, 1143 (10th Cir. 2008). Without express language giving a statute extraterritorial application, courts will presume that a legislature acted within the constitutional scope of its powers to create valid legislation and that it did not intend to give its enactments impermissible extraterritorial operation. 82 C.J.S. Statutes § 362 (2022). In Childs v. State ex rel. Oklahoma State University, 1993 OK 18, ¶22, 848 P.2d 571, 578, this Court refused to apply Texas law to a tort claim arising in Oklahoma and determined we were neither required nor were we willing to give an extraterritorial application of another state's law. We also noted the strong presumption favoring the constitutionality of legislative acts and in general legislative bodies are presumed to have acted within their constitutional powers. Id. ¶13, 848 P.2d at 576. The OCPA does not provide an express limitation on its territorial scope. Its silence will not be presumed to include an extraterritorial application. Until such an express amendment is made to the law, we adopt a presumption against an extraterritorial application of the OCPA. CONCLUSION ¶12 Conduct which creates a violation of the OCPA must occur within this state in order for the OCPA to be applicable. If such offending conduct occurs in more than one state then a court must determine where the conduct primarily and substantially occurs. These principles are the basis for our answers to the certified and reformulated questions. The first certified question is: (1) Does the Oklahoma Consumer Protection Act apply to conduct that physically occurs outside the state of Oklahoma? We reformulate the question as follows: (1) Does the Oklahoma Consumer Protection Act apply to a consumer transaction when the offending conduct that triggers the Act occurs solely within the physical boundaries of another state? We answer this reformulated question in the negative. The second certified question is: (2) Does the Oklahoma Consumer Protection Act apply to conduct where, even if the physical location is difficult to pinpoint, such actions or transactions have a material impact on, or material nexus to, a consumer in the state of Oklahoma? We also answer this question in the negative. When answering certified questions this Court's examination is confined to resolving questions of law, not facts. Having answered these questions, it is for the certifying court to resolve any and all fact questions and to apply the law as provided herein. CERTIFIED QUESTIONS ANSWERED All Justices Concur FOOTNOTES 1 Any statutes referred to in this opinion from the year 2021 can be found in the Official Oklahoma Statutes at https://govt.westlaw.com/okjc/Index?transitionType=Default&contextData=%28sc.Default%29. 2 Hot oil services relate to the pumping of heated fluids into oil and gas pipes to remove blockage in such pipes. 3 The Commerce Clause, found in Article I, § 8, cl. 3 of the United States Constitution, provides in pertinent part, "[t]he Congress shall have Power . . . to regulate commerce . . . among the several states . . . ." The Commerce Clause is the source of constitutional limits imposed on a state's ability to interfere with interstate commerce through regulation and taxation; this implied restriction on state regulation of interstate commerce is known as the negative or dormant Commerce Clause. CDR Sys. Corp. v. Okla. Tax Comm'n, 2014 OK 31, ¶ 2, 339 P.3d 848, 860 (Combs, J., dissenting).

930463c2-8efe-455d-954d-6d96023c7f37

Crawford v. OSU Medical Trust

oklahoma

Oklahoma Supreme Court

CRAWFORD v. OSU MEDICAL TRUST2022 OK 25Case Number: 117870Decided: 03/22/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MIRANDA and COLBY CRAWFORD, Natural Parents and on Behalf of C.C.C., a Minor, and MIRANDA and COLBY CRAWFORD, Individually, Plaintiffs/Petitioners,v.OSU MEDICAL TRUST, a Public Trust d/b/a OSU Medical Center, Defendant/Respondent,andSAINT FRANCIS HOSPITAL, INC., an Oklahoma Corporation, d/b/a St. Francis Children's Hospital, PEDIATRIC OPHTHALMOLOGY, P.C., an Oklahoma Professional Corporation, d/b/a Pediatric Eye Associates and Family Eye Care, and SCOTT S. SADEGHI, D.O., Defendants APPEAL FROM A CERTIFIED INTERLOCUTORY ORDEROF THE DISTRICT COURT OF TULSA COUNTY,STATE OF OKLAHOMAHONORABLE REBECCA NIGHTINGALE, DISTRICT JUDGE ¶0 Dr. Sawyer Hall treated C.C.C. in the emergency room at Saint Francis Hospital on June 16, 2017. C.C.C.'s eye was removed on June 21, 2017. Plaintiffs/Appellants Miranda and Colby Crawford, Natural Parents and on Behalf of C.C.C., a Minor, and Miranda and Colby Crawford, Individually (collectively, the Crawfords) initially filed this medical malpractice lawsuit against Defendant Saint Francis Hospital, Inc. on February 2, 2018. The Crawfords sought to hold Saint Francis liable for damages resulting from Dr. Hall's alleged misdiagnosis. In February 2018, the Crawfords learned that Dr. Hall was actually an intern or resident physician and employee of Defendant/Respondent OSU Medical Trust, doing business as OSU Medical Center (OSUMC), and not an employee of Saint Francis. The parties agree OSUMC is a public trust and subject to the Governmental Tort Claims Act (GTCA), 51 O.S. §§ 151-172. The Crawfords gave notice of their tort claim to OSUMC on August 22, 2018. The trial court granted OSUMC's motion to dismiss for failure to present notice of the claim within one year of the date the loss occurred, pursuant to 51 O.S.Supp.2012 § 156(B). The Crawfords appealed from a certified interlocutory order, and this Court previously granted certiorari. The Crawfords argue that the discovery rule applies and tolls the one-year notice period until they learned Dr. Hall was an employee of OSUMC. We hold: (1) the discovery rule applies to the commencement of the one-year notice period when a medical negligence claim is subject to the GTCA; (2) the discovery rule does not, however, operate to toll the one-year notice period until the Crawfords discovered Dr. Hall was an employee of OSUMC; (3) the tolling provision in 51 O.S.Supp.2012 § 156(E) does not apply to incapacitation due to minority; and (4) when the GTCA controls, the limitations in 12 O.S.2011 § 96 do not apply to the time limits for presenting notice of the claim. Notice was untimely and, as a result, the Crawfords' claims against OSUMC are forever barred. We affirm the trial court's order dismissing OSUMC for lack of jurisdiction. CERTIORARI PREVIOUSLY GRANTED;ORDER OF DISTRICT COURT IS AFFIRMED;REMANDED FOR FURTHER PROCEEDINGS. Paul T. Boudreaux, Richardson Richardson Boudreaux, Tulsa, Oklahoma, for Petitioners. Leslie C. Weeks, Brandon C. Whitworth, Rodolf & Todd, Tulsa, Oklahoma, for Respondent OSU Medical Trust, a Public Trust. KANE, V.C.J.: ¶1 We granted certiorari to review a certified interlocutory order dismissing Defendant/Respondent OSU Medical Trust, doing business as OSU Medical Center (OSUMC), from this medical malpractice lawsuit. The issue is whether Plaintiffs/Appellants Miranda and Colby Crawford, Natural Parents and on Behalf of C.C.C., a Minor, and Miranda and Colby Crawford, Individually (collectively, the Crawfords) complied with the notice provisions of the Governmental Tort Claims Act (GTCA), 51 O.S. §§ 151-172. We hold that the Crawfords failed to present notice of their tort claim within one year of the date the loss occurred and, pursuant to 51 O.S.Supp.2012 § 156(B), their claims against OSUMC are forever barred. We affirm the trial court's order dismissing OSUMC with prejudice. I. FACTS AND PROCEDURAL HISTORY ¶2 On June 16, 2017, C.C.C., a minor child, was taken to Defendant Saint Francis Hospital, Inc.'s emergency room due to problems with his eye. There, C.C.C. was seen by Dr. Sawyer Hall. The Crawfords allege that Dr. Hall's misdiagnosis resulted in C.C.C.'s eye being removed on June 21, 2017. ¶3 The Crawfords initially filed this lawsuit against Saint Francis on February 2, 2018. At the time of filing, the Crawfords believed Dr. Hall was an employee of Saint Francis and alleged that Saint Francis was liable for the negligence of its agents and representatives, which resulted in the enucleation of C.C.C.'s eye. Sometime later in February 2018, the Crawfords learned or discovered that Dr. Hall was actually an intern or resident physician and an employee of OSUMC and not an employee of Saint Francis. The parties agree OSUMC is a public trust and subject to the GTCA. The Crawfords gave notice of their tort claim to OSUMC on August 22, 2018. On December 12, 2018, OSUMC denied the claim based on failure to give notice of the claim within one year of the date of loss, as required by the GTCA. The Crawfords amended their petition to add OSUMC as a defendant. In their Third Amended Petition, the Crawfords claimed that the acts and omissions of OSUMC's agents, employees, representatives, interns and residents caused damages, including the enucleation of C.C.C.'s eye. The Crawfords also explained that they had "accumulated their child's medical records and secured the services of an expert to advise them concerning any breaches of the National Standards of Care. Thereafter, Plaintiffs learned in approximately February of 2018, that the Defendants breached the National Standards of Care." ¶4 OSUMC entered a special appearance and filed a motion to dismiss for lack of jurisdiction based on failure to comply with the notice provisions of the GTCA and for failure to state a claim. OSUMC argued that the Crawfords did not present their notice of tort claim within one year after the date of loss, as required by 51 O.S. § 156(B). Notice was given on August 22, 2018, which was one year and two months after Dr. Hall treated C.C.C. and the eye was removed. The Crawfords responded that the discovery rule tolled the one-year notice period. The Crawfords asserted that they did not learn of OSUMC's malpractice until all the medical records were collected and reviewed. The earliest they knew or could have known of OSUMC's breach of the national standards of care, which resulted in C.C.C.'s injury, was approximately February of 2018 "when their counsel conferred with and secured the opinion of an expert" and, therefore, they had until February 2019 to give notice of the tort claim to OSUMC. The trial court granted OSUMC's motion to dismiss for failure to comply with the one-year notice requirement in the GTCA. The trial court certified the order for interlocutory review pursuant to 12 O.S.2011 § 952(b)(3). We previously granted certiorari. II. STANDARD OF REVIEW ¶5 A dismissal for lack of subject matter jurisdiction is reviewed de novo. See Video Gaming Techs., Inc. v. Tulsa Cty. Bd. of Tax Roll Corr., 2019 OK 84, ¶ 2, 455 P.3d 918, 919. The notice required by 51 O.S. § 156(B) is considered a mandatory prerequisite and jurisdictional requirement to filing a tort claim in district court. See Hall v. GEO Grp., Inc., 2014 OK 22, ¶¶ 1, 19, 324 P.3d 399, 400, 406. The Crawfords contend the trial court erred by not applying the discovery rule1 to toll the one-year notice period in 51 O.S.Supp.2012 § 156(B) of the GTCA. This proposition of error presents a question of law, which we review de novo. See Grisham v. City of Oklahoma City, 2017 OK 69, ¶ 4, 404 P.3d 843, 846. Whether 51 O.S.Supp.2012 § 156(E) tolls the notice period due to minority and whether 12 O.S.2011 § 96 applies to a GTCA claim both present issues of statutory interpretation. Issues of statutory interpretation also present questions of law and are reviewed de novo. See Fanning v. Brown, 2004 OK 7, ¶ 8, 85 P.3d 841, 845. Appellate courts have plenary, independent and nondeferential authority to determine whether the trial court erred in its legal rulings. Id. III. ANALYSIS A. If the Discovery Rule Applies to the Underlying Tort, It Applies to the Commencement of the One-Year Notice Period in the GTCA ¶6 The parties agree OSUMC is a public trust and that the Crawfords' claims are subject to the requirements of the GTCA.2 "The GTCA is the exclusive remedy by which an injured plaintiff may recover against a governmental entity for its negligence." Smith v. City of Stillwater, 2014 OK 42, ¶ 14, 328 P.3d 1192, 1198. The GTCA narrowly structures the method and timeframe for bringing a tort claim against the State or a political subdivision. See Watkins v. Cent. State Griffin Mem'l Hosp., 2016 OK 71, ¶ 21, 377 P.3d 124, 130 (citing 51 O.S.2011 § 156). Section 156(B) of the GTCA provides, in pertinent part: [C]laims against the state or a political subdivision are to be presented within one (1) year of the date the loss occurs. A claim against the state or a political subdivision shall be forever barred unless notice thereof is presented within one (1) year after the loss occurs. 51 O.S.Supp.2012 § 156(B). "The [GTCA] requires, without exception, that the plaintiff give notice and commence an action [in the district court] within the prescribed statutory time limits." Jarvis v. City of Stillwater, 1987 OK 5, ¶ 5, 732 P.2d 470, 473. ¶7 Generally, a cause of action accrues, and the applicable statute of limitations begins to run, when the injury occurs. See Calvert v. Swinford, 2016 OK 100, ¶ 11, 382 P.3d 1028, 1033. The common law discovery rule tolls the limitations period until the injured party knows or, in the exercise of reasonable diligence, should have known of the injury. See id.; Woods v. Prestwick House, Inc., 2011 OK 9, ¶¶ 24-25, 247 P.3d 1183, 1189-90. Whether the discovery rule applies to the statutory time limits in the GTCA depends on the underlying tort. The discovery rule only applies in certain tort cases. See Calvert, 2016 OK 100, ¶ 11, 382 P.3d at 1033. If the discovery rule applies to the underlying tort in a non-GTCA case, it applies to the commencement of the one-year notice period when that tort claim is subject to the GTCA. ¶8 The discovery rule applies to medical negligence claims that are not subject to the requirements of the GTCA. See 76 O.S.2011 § 18; Wing v. Lorton, 2011 OK 42, 261 P.3d 1122 (applying 76 O.S. § 18); Seitz v. Jones, 1961 OK 283, 370 P.2d 300 (applying the common law discovery rule). Thus, we hold the discovery rule applies to the commencement of the one-year notice period when a medical negligence claim is subject to the GTCA.3 B. The Discovery Rule Does Not Toll Commencement of the One-Year Notice Period Until the Crawfords Learned the Tortfeasor was an Employee of the State or a Political Subdivision ¶9 The Crawfords argue the discovery rule should apply because they did not learn Dr. Hall was an employee of an entity subject to the GTCA until February 2018. The Crawfords explain: Plaintiffs, through counsel, did not discover the malpractice by Defendant, OSU, until all the medical records of C.C.C. were collected and reviewed. C.C.C.'s misdiagnosis occurred at Saint Francis Children's Hospital, and Plaintiffs did not have reason to know and did not know that a physician who was involved in malpractice worked for OSU rather than Saint Francis Hospital, Inc., where the malpractice occurred. The earliest that Plaintiffs knew or could have known through reasonable diligence that the individual involved in the malpractice that resulted in C.C.C.'s damages was employed by Defendant, OSU, and not Saint Francis, was approximately February 2018, when counsel conferred with and secured the opinion of an expert after providing the expert with all pertinent medical records. Appellant's Brief-in-Chief, p. 7. The Crawfords argue that because the discovery rule tolled the one-year notice period, they had until February 2019 to give OSUMC notice of their claim and, therefore, the notice provided on August 22, 2018 was timely. They rely on two Court of Civil Appeals cases, Bentley v. Kirk, 2015 OK CIV APP 43, 348 P.3d 1112, and Lavender v. Craig General Hospital, 2013 OK CIV APP 80, 308 P.3d 1071, to support their argument. Bentley and Lavender do not support the extension of the discovery rule that the Crawfords desire. While both cases involved medical malpractice claims and GTCA-entities given notice outside the one-year limitation, neither opinion addresses the issue presented in this case: whether the discovery rule tolls the one-year notice period until the plaintiffs discover the physician was employed by an entity subject to the GTCA. ¶10 The Crawfords assert they did not know nor should they have known, through the exercise of reasonable diligence, that Dr. Hall was an OSUMC intern or resident, and not an employee of Saint Francis, until their counsel conferred with an expert. Even assuming their assertions are true, as we must, that is not the type of discoverable information contemplated by the rule. The discovery rule pertains to the plaintiff discovering "sufficient information to be aware of the claims," Watkins, 2016 OK 71, ¶ 30, 377 P.3d at 132, and "sufficient facts to state a cause of action." Woods, 2011 OK 9, ¶ 3, 247 P.3d at 1186. Medical negligence, like all negligence claims, contains three elements: (1) a duty owed by the defendant to protect the plaintiff from injury; (2) a failure to properly exercise or perform that duty; and (3) plaintiff's injuries proximately caused by the defendant's failure to exercise his duty of care. See Robinson v. Okla. Nephrology Assocs., Inc., 2007 OK 2, ¶ 9, 154 P.3d 1250, 1253-54. The discovery rule applies to the statutory time limit for giving notice under the GTCA much like it applies to the statute of limitations for a non-GTCA medical negligence claim.4 For general medical malpractice cases, this Court has said the pertinent inquiries in a discovery rule analysis are when the plaintiff acquired sufficient information that she knew or should have known of (1) the injury itself; and (2) the wrongfulness and cause of the injury. See Wing, 2011 OK 42, ¶¶ 14, 19, 261 P.3d at 1126-28. ¶11 The Crawfords are not claiming they did not discover the injury itself until February 2018. The injury alleged is the loss of the eye. It is undisputed the Crawfords knew about the injury itself when C.C.C.'s eye was removed on June 21, 2017. This Court has said the discovery rule applies when the injury manifests after the wrongful act or omission responsible for the medical negligence action. See id. ¶ 13, at 1126. That is not the situation in this case. The injury manifested just five days after Dr. Hall's alleged wrongful act or omission. The purpose of the discovery rule "is to exclude the period of time during which the injured party is reasonably unaware that an injury has been sustained so that people in that class have the same rights as those who suffer an immediately ascertainable injury." Woods, 2011 OK 9, ¶ 24, 247 P.3d at 1190. In this case, the injury itself was ascertainable when C.C.C.'s eye was removed. ¶12 The Crawfords are not claiming they did not discover the wrongfulness and cause of the injury until February 2018. The Crawfords allege the wrongfulness and cause of the injury was the misdiagnosis provided by Dr. Hall on June 16, 2017. The Crawfords are not claiming they did not discover that Dr. Hall's misdiagnosis caused C.C.C.'s injuries until February 2018. In fact, on February 2, 2018, the Crawfords filed a lawsuit against Saint Francis based on Dr. Hall's alleged misdiagnosis--the same medical negligence upon which their claims against OSUMC are based. ¶13 Rather, the Crawfords claim they did not know the identity of Dr. Hall's employer until February 2018. The discovery rule does not apply in this case as a matter of law. The one-year notice period began when C.C.C. lost his eye on June 21, 2017. At that point in time, the Crawfords had sufficient information to state a cause of action for medical negligence based on Dr. Hall's alleged misdiagnosis. The Crawfords did not need to know the identity of the tortfeasor's employer to state a cause of action.5 When a plaintiff is injured and their medical negligence claim accrues, they may not know whether the individual, who allegedly committed malpractice, is an employee of the state or a political subdivision. After the Crawfords had sufficient information to be aware of their claims, it became their duty to investigate the claims and explore theories of liability, including vicarious liability, respondeat superior, individual liability, and whether their claims were subject to the GTCA.6 The Crawfords had one year from the date C.C.C.'s eye was removed to determine if Dr. Hall was an employee of the state or a political subdivision and, if so, present notice of their claim. The Crawfords, admittedly, assumed Dr. Hall was an employee of Saint Francis because he treated C.C.C. at a Saint Francis facility. It was not until after the suit was initially filed and the Crawfords' counsel, as part of their litigation strategy, consulted an expert in February 2018 that they learned Dr. Hall was an employee of OSUMC.7 The GTCA's one-year notice period expired on June 21, 2018. The Crawfords did not present notice of their claim until August 22, 2018. C. Title 51, § 156(E) Does Not Toll the Notice Period When the Injured Person is Incapacitated Due to Minority ¶14 On appeal, the Crawfords assert that 51 O.S. § 156(E) also tolls the one-year notice period.8 Section 156(E) of the GTCA tolls the notice period while the injured person is incapacitated: "The time for giving written notice of claim pursuant to the provisions of this section does not include the time during which the person injured is unable due to incapacitation from the injury to give such notice, not exceeding ninety (90) days of incapacity." 51 O.S.Supp.2012 § 156(E). The Crawfords argue that § 156(E) applies to C.C.C.'s inability, due to incapacitation as a minor, to give notice. ¶15 We disagree. The plain and unambiguous language of the statute provides that the one-year notice period is tolled 90 days only if "the person injured is unable due to incapacitation from the injury to give such notice . . . ." 51 O.S. § 156(E) (emphasis added); see also Johns v. Wynnewood Sch. Bd. of Ed., 1982 OK 101, ¶ 6, 656 P.2d 248, 250 ("The time for giving notice excludes up to 90 days of time during which the party is incapacitated as a result of the injury."). In Johns v. Wynnewood School Board of Education, 1982 OK 101, 656 P.2d 248, we noted that § 156 "specifically deals with incapacity arising from physical results of the injury and does not speak to incapacity resulting from minority." Id. ¶ 6, at 250. Section 156 of the GTCA does not toll the notice period due to incapacity resulting from minority. The Crawfords do not allege that C.C.C. was incapacitated as a result of the injury; they allege incapacity due to his status as a minor. The injury to C.C.C.'s eye did not create a legal incapacity which prevented him from giving notice of his claim. The 90-day extension in 51 O.S. § 156(E) does not apply.9 D. When the GTCA Controls, 12 O.S. § 96 Does Not Apply ¶16 Title 12, § 96 is the general statute of limitations for a tort action brought by a person under a legal disability. This section provides: If a person entitled to bring an action other than for the recovery of real property, except for a penalty or forfeiture, be, at the time the cause of action accrued, under any legal disability, every such person shall be entitled to bring such action within one (1) year after such disability shall be removed, except that, after the effective date of this section, an action for personal injury to a minor under the age of twelve (12) arising from medical malpractice must be brought by the minor's parent or guardian within seven (7) years of infliction of the injury, provided a minor twelve (12) years of age and older must bring such action within one (1) year after attaining majority, but in no event less than two (2) years from the date of infliction of the injury, and an action for personal injury arising from medical malpractice to a person adjudged incompetent must be brought by the incompetent person's guardian within seven (7) years of infliction of the injury, provided an incompetent who has been adjudged competent must bring such action within one (1) year after the adjudication of such competency, but in no event less than two (2) years from the date of infliction of the injury. 12 O.S.2011 § 96 (emphasis added). C.C.C. was four years old at the time of the injury. The Crawfords note that if this was a malpractice action against a non-governmental entity and the GTCA did not apply, the limitations period for their claims would be seven years. Without citing any authority, the Crawfords argue the seven-year statute of limitations that applies to a non-GTCA action for personal injuries to a minor arising from medical malpractice should apply to a GTCA action for the same, thereby extending the one-year notice period to seven years.10 ¶17 In Johns, this Court determined that 12 O.S. § 96 does not apply to governmental tort claims for injuries to minors. In Johns, a minor was injured at school on September 18, 1979. See Johns, 1982 OK 101, ¶ 2, 656 P.2d at 248. The parents of the minor gave notice of the claim to the school board on September 10, 1981 and then filed suit. Id. ¶ 2, at 249. At that time, the Oklahoma Political Subdivision Tort Claims Act--the predecessor to the GTCA--applied, and the time limit for presenting notice of the claim was only 120 days.11 The school board sought to dismiss the action based on the plaintiffs' failure to comply with the 120-day notice period in 51 O.S. § 156. Id. The plaintiffs responded that, as a minor, plaintiff was under a legal disability to institute an action on her own behalf and, therefore, she could do so at any time within one year after she attained majority,12 pursuant to 12 O.S.1971 § 96. Id. This Court was presented the following federal certified question: Are the time limitations contained in the Oklahoma Political Subdivision Tort Claims Act, 51 Okla.Stat. (1978 Supp.) § 156, controlling as to a cause of action accrued to a minor, notwithstanding the provisions of 12 Okla.Stat.1971 § 96? Id. ¶ 1, at 248. We answered "yes" and determined that "[t]he time limitations contained in the Oklahoma Political Subdivision Tort Claims Act, 51 Okla.Stat. (1978 Supp.) (now 1981) § 156, control as to a cause of action accrued to a minor, notwithstanding the provisions of 12 O.S.1981 § 96." Id. ¶ 7, at 250. We held "that the minority of the plaintiff when injured did not toll the time limits as prescribed in 51 Okla.Stat. § 156 as against the defendant School Board." Id. ¶ 2, at 248-49. In reaching our answer in Johns, we examined the tolling provision in § 156: "The time for giving written notice of claim pursuant to the provisions of this section does not include the time during which the person injured is unable due to incapacitation from the injury to give such notice, not exceeding ninety (90) days of incapacity." 51 O.S.Supp.1978 § 156(C) (renumbered 51 O.S. § 156(E) by Laws 1984, c. 226, § 8, eff. Oct. 1, 1985). This is the same provision at issue today. See 51 O.S.Supp.2012 § 156(E). In Johns, we determined: In view of the fact the Act specifically deals with incapacity arising from physical results of the injury and does not speak to incapacity resulting from minority, it is proper to apply the language of the statute to all incapacities not specifically excepted in view of the clear language of the statute's (§ 156) unqualified statement that no action may be maintained unless notice is filed within 120 days, and action commenced within six months. Johns, 1982 OK 101, ¶ 6, 656 P.2d at 250 (applying 51 O.S.Supp.1978 § 156(B)) (footnotes omitted). ¶18 The same question is posed today. Does 12 O.S.2011 § 96 apply to a governmental tort claim for injuries to a minor? More specifically, does the seven-year limitations period in 12 O.S.2011 § 96 supplant the one-year notice period in 51 O.S.Supp.2012 § 156(B) when the governmental tort claim is for injuries to a minor under the age of twelve (12) arising from medical malpractice? Continuing to follow Johns, we hold the GTCA, 51 O.S.Supp.2012 § 156, controls as to a cause of action accrued to a minor notwithstanding the provisions of 12 O.S.2011 § 96. Section 96 does not apply. The one-year notice period in 51 O.S. § 156 applies to a governmental tort claim for injuries to a minor arising from medical malpractice. Minority does not toll the time limits as prescribed in 51 O.S.Supp.2012 § 156. ¶19 Our holding in Johns remains instructive even after subsequent amendments to 12 O.S. § 96. In 1987, 12 O.S. § 96 was amended to add exceptions to the statute of limitations for injuries to a minor arising out of medical malpractice. However, the amendments to § 96 do not change this Court's determination in Johns that when the GTCA controls, § 96 does not apply. In order to toll or extend the notice period for injuries to minors in a GTCA action, the Legislature would need to amend the GTCA. In Johns, we explained: The exception granted infants from the running of the statute of limitations rests on legislative determination and does not emanate from a fundamental precept of the law. It is within the power of the legislature to place infants in the same category as adults in the respect of limitations and unless excepted by statute, the limitations statutes apply to that class of persons. . . . [E]xception of infants from limitations statutes is a matter of legislative cognizance. The exception from the limitation provisions for persons under incapacities is spoken to in § 156 and no mention is made of exceptions for minors. Johns, 1982 OK 101, ¶¶ 4, 6, 656 P.2d at 249-50 (internal citations omitted). To this day, the Legislature has not amended 51 O.S. § 156 to add a specific exception for minors with tort claims against the government. ¶20 This Court has cited Johns for its precedential value multiple times since it was decided in 1982.13 In Hamilton v. Vaden, 1986 OK 36, 721 P.2d 412, this Court concluded the Legislature intended for 12 O.S.1981 § 96 to toll the two-year statute of limitations provided by 12 O.S.1981 § 95(3) and, therefore, a minor could bring an action for personal injuries any time before they reached majority plus one year. See id. ¶ 20, at 419. We noted: The only diversion from the course we have plotted here is found within the provisions of the Political Subdivision Tort Claim Act, 51 O.S. 1981 § 156. In Johns v. Wynnewood School Bd. of Educ., 656 P.2d 248 (Okla.1982), a minor was injured while on the school yard playing during recess. In Ross v. City of Shawnee, 683 P.2d 535 (Okla.1984), the minor received injuries at the municipal swimming pool. The minors were held to the same statute of limitations as adults under 51 O.S. 1981 § 156. These cases are distinguishable because the notice provision of the Political Subdivision Tort Claims Act furthers legitimate state interests by fostering a prompt investigation while the evidence is fresh; the opportunity to repair any dangerous condition, quick and amicable settlement of meritorious claims; and preparation of fiscal planning to meet any possible liability. Reirdon v. Wilburton Bd. of Ed., 611 P.2d 239-40 (Okla.1980). Further, by its terms 51 O.S. 1981 § 170 supersedes all other statutory provisions. Hamilton, 1986 OK 36, n. 31, 721 P.2d at 419. More recently, in Hall v. GEO Group, Inc., 2014 OK 22, 324 P.3d 399, we reiterated that when the GTCA controls, 12 O.S. § 96 does not apply. In Hall, an inmate alleged he was injured on September 7, 2010 while being transported in a van. See id. ¶ 3, at 402. On June 18, 2012, he filed a negligence action in the district court. Id. ¶ 5, at 402. In response to the prison's motion to dismiss based on the statute of limitations, the inmate responded that, pursuant to 12 O.S. § 96, the limitations period in 12 O.S.2011 § 95(11) should be tolled until one year after his legal disability was removed. Id. ¶ 6, at 402. First, we determined compliance with the notice provisions of the GTCA was required for a prisoner, or former prisoner, to bring a tort action against a private correctional facility. Id. ¶¶ 1, 10-13, at 400, 403-04. Then, the Court looked at whether 12 O.S. § 96 tolled the GTCA's one-year notice period. Id. ¶¶ 14-16, at 404-05. Citing Johns, we explained: "As for Hall's claims of tolling because he was under a legal disability we have previously held that where the GTCA includes specific provisions, the general statute of limitations does not apply." Id. ¶ 15, at 405 (footnotes omitted). We held that because the GTCA was controlling, 12 O.S. § 96 did not apply. See id. ¶ 14, at 404. Because the GTCA only tolls the notice period due to incapacity from the injury for 90 days, the case was dismissed as untimely. Id. ¶¶ 1, 10, 19, at 400-01, 404, 406. ¶21 Like the plaintiffs in Johns and Hall, the Crawfords argue that 12 O.S. § 96 applies to their tort claim against the government. In Johns, we said that when the GTCA controls, tolling the notice period is limited to § 156--which does not include incapacity due to minority--and § 96 does not apply. In Hall, we said when the GTCA controls, tolling of the notice period due to incapacity as a result of the injury is limited to 90 days, and § 96 does not apply. In this case, the GTCA also controls. We cannot square applying 12 O.S. § 96 to the Crawfords' claim against the government when we did not apply § 96 to the plaintiffs' claims against the government in Johns and Hall. ¶22 Without explanation, the Crawfords assert that 12 O.S. § 96 applies pursuant to 51 O.S. § 164. Section 164 provides: The laws and statutes of the State of Oklahoma and the Rules of Civil Procedure, as promulgated and adopted by the Supreme Court of Oklahoma insofar as applicable and to the extent that such rules are not inconsistent with the provisions of this act, shall apply to and govern all actions brought under the provisions of this act. 51 O.S.2011 § 164. There are some situations where Title 12 applies to a governmental tort claim. We have found the general laws and rules of civil procedure apply when the GTCA does not speak specifically to a matter. See Cruse v. Bd. of Cty. Comm'rs of Atoka Cty., 1995 OK 143, ¶ 17, 910 P.2d 998, 1005 (holding 12 O.S.1991 § 100 applies to a GTCA claim when the action was timely-filed in district court); Rout v. Crescent Pub. Works Auth., 1994 OK 85, ¶¶ 8-10, 878 P.2d 1045, 1049-50 (holding 12 O.S.1991 § 940 applies to a GTCA claim, because the GTCA does not contain a specific provision for attorney fees and costs). This Court will only apply the general laws of the State to governmental tort claims where there has been timely compliance with the GTCA. The notice required by 51 O.S. § 156 is considered a mandatory prerequisite and jurisdictional requirement to filing a tort claim in district court. See Hall, 2014 OK 22, ¶¶ 1, 19, 324 P.3d at 400, 406. Only "where valid notice has been given and the governmental tort claims action has been timely filed under § 157, the court's power is invoked and, at that point, pursuant to the broad terms of 51 O.S.1991, § 164, the governmental tort claims action is controlled by the laws of this state . . . ." Cruse, 1995 OK 143, ¶ 17, 910 P.2d at 1005 (emphasis added). ¶23 The GTCA is not silent as to when the notice period can be tolled. The GTCA's notice provisions, including the time limits for giving notice and when the notice period may be tolled are specific, detailed, and comprehensive. In Johns, we said: Title 51 O.S. § 156 contains detailed provisions for limitations of actions against political subdivisions. There are no express exceptions saving the rights of infants found within this section or any other portion of the Act. This is true despite the detailed limitation provisions of 51 O.S. §§ 156 and 157. On the face of the statute, the limitations provided by § 156 are detailed and also appear absolute in that Subdivision B states, "A claim . . . shall be forever barred unless notice thereof is filed within one hundred twenty days after the loss occurs." The comprehensive nature of the limitations provisions is evident. . . . The time for giving notice excludes up to 90 days of time during which the party is incapacitated as a result of the injury. . . . In view of the fact the Act specifically deals with incapacity arising from physical results of the injury and does not speak to incapacity resulting from minority, it is proper to apply the language of the statute to all incapacities not specifically excepted in view of the clear language of the statute's (§ 156) unqualified statement that no action may be maintained unless notice is filed within 120 days, and action commenced within six months. Johns, 1982 OK 101, ¶ 6, 656 P.2d at 249-50 (footnotes omitted) (applying 51 O.S.Supp.1978 § 156(B)-(C)). Section 156(E) of the GTCA clearly and unambiguously provides that the notice period may be tolled only due to incapacitation from the injury. The GTCA does not provide for tolling due to minority. Furthermore, tolling authorized by § 156(E) is limited to 90 days. Applying the seven-year limitation in 12 O.S. § 96 to the notice period in 51 O.S. § 156 would be inconsistent with the provisions of the GTCA and is, therefore, not permitted by 51 O.S. § 164. Until the GTCA contains exceptions for minors or specific tolling provisions for minors, the one-year notice period applies equally to minors. ¶24 This conclusion is consistent with the Legislature's limited waiver of sovereign immunity. See 51 O.S.2011 § 152.1(B); 51 O.S.Supp.2015 § 153(A); Cruse, 1995 OK 143, ¶ 10, 910 P.2d at 1001-02. We have said: "The manner in which a party may overcome sovereign immunity and maintain an action against the government is narrowly structured by the procedural prerequisites in §§ 156 and 157." Cruse, 1995 OK 143, ¶ 11, 910 P.2d at 1002 (footnote omitted). "Upon compliance with the time-limited procedural steps in §§ 156 and 157, the state's consent to be sued is manifest, the sovereign immunity bar is removed, and a judicial remedy for enforcement of the tort claim against the state or political subdivision may be maintained." Id. ¶ 12, 1002-03. ¶25 The Crawfords did not give OSUMC timely notice of their tort claim in compliance with § 156. As a result, they have not brought themselves within the limited waiver of sovereign immunity contained in the GTCA. The Crawfords cannot invoke the jurisdiction of the district court. IV. CONCLUSION ¶26 If the discovery rule applies to the underlying tort, it applies to the commencement of the one-year notice period in the GTCA. Thus, the discovery rule applies to medical negligence claims subject to the GTCA. The notice period provided in 51 O.S.Supp.2012 § 156(B) does not commence until the plaintiff has sufficient information that they know or should have known of the injury itself and the wrongfulness and cause of the injury. The discovery rule does not operate to toll commencement of the one-year notice period until the plaintiff learns the tortfeasor is an employee of the state or a political subdivision. Furthermore, 51 O.S.Supp.2012 § 156(E) does not toll the notice period due to the injured person's status as a minor. When the GTCA controls, the limitations for personal injuries to minors arising out of medical malpractice in 12 O.S.2011 § 96 do not apply. ¶27 The discovery rule does not toll commencement of the one-year notice period until the Crawfords learned Dr. Hall was an employee of OSUMC. The one-year notice period commenced when C.C.C.'s eye was removed on June 21, 2017. The Crawfords did not give OSUMC notice of their tort claims within one year of the date the loss occurred. As a result, their claims against OSUMC are barred. The district court properly dismissed those claims for lack of jurisdiction. This matter is remanded for further proceedings. CERTIORARI PREVIOUSLY GRANTED;ORDER OF DISTRICT COURT IS AFFIRMED;REMANDED FOR FURTHER PROCEEDINGS. CONCUR: Darby, C.J., Kane, V.C.J., Winchester, Rowe, and Kuehn, JJ. CONCUR IN RESULT: Combs (by separate writing) and Gurich, JJ. DISSENT: Kauger (by separate writing) and Edmondson, JJ. FOOTNOTES 1 Litigants--and the courts--often conflate the discovery rule, equitable tolling, and estoppel. Nonetheless, these are separate theories a plaintiff may employ to defeat a statute of limitations defense. See Calvert v. Swinford, 2016 OK 100, ¶ 11, 382 P.3d 1028, 1033 (discovery rule); Masquat v. DaimlerChrysler Corp., 2008 OK 67, ¶ 18, 195 P.3d 48, 54-55 (equitable tolling based on fraudulent concealment); Jarvis v. City of Stillwater, 1987 OK 5, ¶ 4, 732 P.2d 470, 472-73 (estoppel). At no point have the Crawfords advocated for equitable tolling based on fraudulent concealment. The Crawfords raise an estoppel argument for the first time in their Reply Brief. Estoppel was not raised below, and "[t]his Court does not make first-instance determinations of disputed issues of either law or fact in the exercise of its appellate jurisdiction." In re Guardianship of Stanfield, 2012 OK 8, ¶ 27, 276 P.3d 989, 1001. Furthermore, "[n]ew arguments may not be raised for the first time in a reply brief." Cox Okla. Telecom, LLC, v. State ex rel. Okla. Corp. Comm'n, 2007 OK 55, ¶ 33, 164 P.3d 150, 162-63. This opinion addresses only whether the discovery rule applies to the statutory time limits in the GTCA. 2 OSUMC's position is that the GTCA applies. Section 152 of the GTCA provided, in part: "Except as provided in subparagraph b of this paragraph, in no event shall the state be held liable for the tortious conduct of any physician, resident physician or intern while practicing medicine or providing medical treatment to patients . . . ." 51 O.S.Supp.2014 § 152(7)(c). At no point has OSUMC argued the case should be dismissed pursuant to this provision. 3 In Watkins v. Central State Griffin Memorial Hospital, 2016 OK 71, 377 P.3d 124, this Court acknowledged--without explicitly stating--that the discovery rule applies to the one-year notice period in 51 O.S. § 156(B). In Watkins, the plaintiff alleged hospital employees actively concealed information essential to her medical malpractice claims. See Watkins, 2016 OK 71, ¶ 5, 377 P.3d at 126. Our analysis was based on the doctrine of estoppel rather than the discovery rule. However, the discovery rule is referenced in the final two paragraphs of the opinion. Id. ¶¶ 30-31, at 132. In addition to finding a question of fact existed as to whether the doctrine of estoppel barred a defense based on the one-year limitation on notice, we also found "it is for the trier of fact to determine when [the plaintiff] knew, or in the exercise of reasonable diligence should have known, sufficient information to be aware of her claims." Id. ¶ 31, at 132. The Court was clearly referring to the discovery rule. 4 The statute of limitations for general medical malpractice claims provides the action must be "brought within two (2) years of the date the plaintiff knew or should have known, through the exercise of reasonable diligence, of the existence of the death, injury or condition complained of . . . ." 76 O.S.2011 § 18. The GTCA provides that "claims . . . are to be presented within one (1) year of the date the loss occurs." 51 O.S.Supp.2012 § 156(B). The GTCA defines "loss" as "death or injury to the body or rights of a person or damage to real or personal property or rights therein." 51 O.S.Supp.2014 § 152(8). 5 The Crawfords, in fact, did bring a medical malpractice action against Saint Francis based on Dr. Hall's acts and omissions. When the lawsuit was initially filed on February 2, 2018, the Crawfords named Saint Francis as the only defendant. 6 The Crawfords have never named Dr. Hall, individually, as a defendant in this lawsuit. Residents and interns are subject to individual liability for torts committed while practicing medicine or providing medical treatment to patients. See 51 O.S.Supp.2014 § 152(7)(c); Anderson v. Eichner, 1994 OK 136, ¶¶ 15-16, 890 P.2d 1329, 1338-39; see also 51 O.S.2011 § 154(E) (limits their liability to $100,000); 51 O.S.Supp.2012 § 156(G) ("Claims and suits against resident physicians or interns shall be made in accordance with the provisions of Titles 12 and 76 of the Oklahoma Statutes."); 51 O.S.Supp.2012 § 163(C) ("[S]uits based on the conduct of resident physicians and interns shall be made against the individual consistent with the provisions of Title 12 of the Oklahoma Statutes."). The notice provisions of the GTCA do not apply to suits against individual residents and interns. See Lykins v. Saint Francis Hosp., Inc., 1995 OK 135, ¶¶ 8-10, 917 P.2d 1, 4-5. 7 At that point, the Crawfords still had four months to give OSUMC timely notice of their claim. 8 This argument was not presented to the trial court. Generally, "[t]his Court does not make first-instance determinations of disputed issues of either law or fact in the exercise of its appellate jurisdiction." Stanfield, 2012 OK 8, ¶ 27, 276 P.3d at 1001. However, we will address this argument because it is determinative of the district court's jurisdiction. Jurisdictional inquires may be made at any stage of the proceedings. See Hall v. GEO Grp., Inc., 2014 OK 22, ¶ 12, 324 P.3d 399, 404. As we have said, compliance with the notice provisions of the GTCA is a mandatory prerequisite and jurisdictional requirement for bringing a suit for tort damages. See id. ¶¶ 1, 19, at 400, 406. Resolution of this issue affects whether notice was timely and, consequently, whether the district court had jurisdiction over the claims. 9 We further decline the Crawfords' request that our interpretation of 51 O.S.Supp.2012 § 156(E) apply prospectively only. 10 This argument was not raised below. However, we will address the issue because it is determinative of the district court's jurisdiction. See supra note 8. 11 When Johns was decided, 51 O.S.Supp.1978 § 156(B) provided: "A claim against a political subdivision or employee shall be forever barred unless notice thereof is filed with the clerk of the governing body of the political subdivision within one hundred twenty (120) days after the loss occurs." The statute has since been amended to extend the notice period to one year. Today, the statute provides: "[C]laims against the state or a political subdivision are to be presented within one (1) year of the date the loss occurs. A claim against the state or a political subdivision shall be forever barred unless notice thereof is presented within one (1) year after the loss occurs." 51 O.S.Supp.2012 § 156(B). 12 At that time, 12 O.S. § 96 did not include the current exceptions for personal injuries to a minor arising out of medical malpractice. Section 96 provided: If a person entitled to bring an action other than for the recovery of real property, except for a penalty or forfeiture, be, at the time the cause of action accrued, under any legal disability, every such person shall be entitled to bring such action within one (1) year after such disability shall be removed. 12 O.S.1971 § 96. The general "within one (1) year after such disability shall be removed" statute of limitations for a person with a legal disability applied to a minor's action for personal injuries. Id.; see Hamilton v. Vaden, 1986 OK 36, ¶ 20, 721 P.2d 412, 419 ("[A] minor is entitled to institute an action for personal injuries anytime before he/she reaches majority plus one year."). 13 See, e.g., Hall, 2014 OK 22, n. 26, 324 P.3d at 405; Cruse v. Bd. of Cty. Comm'rs of Atoka Cty., 1995 OK 143, ¶ 13, 910 P.2d 998, 1003; Rout v. Crescent Pub. Works Auth., 1994 OK 85, n. 12, 878 P.2d 1045, 1049; In re Estate of Speake, 1987 OK 61, n. 14, 743 P.2d 648, 652; Hamilton, 1986 OK 36, n. 31, 721 P.2d at 419; Ross v. City of Shawnee, 1984 OK 43, ¶ 14, 683 P.2d 535, 537. COMBS, J., with whom GURICH, J., joins, concurring in result: ¶1 I concur in result with the majority opinion that affirms dismissal of the Crawfords' claims against OSUMC for lack of subject matter jurisdiction based upon their failure to give timely notice under the Governmental Torts Claims Act (GTCA), 51 O.S.Supp.2017, § 156(B). The GTCA defines the "State" as "the State of Oklahoma or any office, department, agency, authority, commission, board, institution, hospital, college, university, public trust created pursuant to Title 60 of the Oklahoma Statutes of which the State of Oklahoma is the beneficiary, or other instrumentality thereof," id. § 152(13) (emphasis added), and requires "[a]ny person having a claim against the state . . . within the scope of Section 151 et seq. of this title [to] present a claim to the state . . . for any appropriate relief including the award of money damages . . . . within one (1) year of the date the loss occurs," id. § 156(A)--(B) (emphasis added). As a state institution and hospital affiliated with a public university, OSUMC is the "State" for purposes of our analysis, and the Crawfords' claims against OSUMC are "claim[s] against the state" for which notice is required. ¶2 I write separately, however, to emphasize the fact that dismissal of OSUMC from the lawsuit based upon failure to comply with the GTCA's notice requirements should not be viewed as foreclosing any action against Dr. Sawyer Hall, the resident physician or intern employed by OSUMC whose alleged misdiagnosis resulted in the loss of C.C.C.'s eye.1 ¶3 First, I wish to point out that nothing in the majority opinion should be viewed as a determination that Dr. Hall's actions in "practicing medicine or providing medical treatment to patients" were within the course and scope of his state employment and that he is therefore "immune from liability for torts" under section 152.1(A) of the GTCA,2 or that the State alone would therefore be liable under section 153(A) of the GTCA.3 Rather, as we recognized in Anderson v. Eichner, 1994 OK 136, 890 P.2d 1329, "the legislature intended for these physicians"--which includes resident physicians and interns, see id. ¶¶ 3, 5, 10, 890 P.2d at 1333--34, 1337--"to be outside the scope of their employment whenever they engage in the practice of medicine or in the provision of medical or surgical treatment, even though they also may be acting as teacher or student." Id. ¶ 11, 890 P.2d at 1337. Because the provision of medical treatment falls outside the scope of employment for resident physicians and interns like Dr. Hall, he would be individually liable for tortious conduct that occurred while he was providing medical treatment to C.C.C., but only up to the amount specified in section 154(E) of the GTCA. See Anderson, 1994 OK 136, ¶¶ 14--16 & n.30, 890 P.2d at 1338--39 & n.30. ¶4 The Anderson Court's holding is based upon the statutory language in section 152(7)(c) of the GTCA. Section 152(7) is "a definitional section that describes who are state employees." Anderson, 1994 OK 136, ¶ 14, 890 P.2d at 1338 (talking about 51 O.S.Supp.1986, § 152(5), which was renumbered as paragraph (6) in 2007 and as paragraph (7) in 2010). When the Anderson case was decided, the definition of a state "employee" only included three classes of physicians: "[1] physicians acting in an administrative capacity, [2] resident physicians and resident interns participating in a graduate medical education program of the University of Oklahoma College of Medicine or the Oklahoma College of Osteopathic Medicine and Surgery and [3] faculty members of the University of Oklahoma College of medicine and the Oklahoma College of Osteopathic Medicine and Surgery, while engaged in their teaching duties." Id. ¶ 10 n.21, 890 P.2d at 1336 n.21 (quoting 51 O.S.Supp.1986, § 152(5)). The final sentence of the definition contained this proviso: "However, in no event shall the state be held liable for the tortious conduct of any physician, resident physician or intern while practicing medicine or providing medical treatment to patients." Id. (quoting 51 O.S.Supp.1986, § 152(5)). The Anderson Court determined that this proviso "clearly lays down the rule that, although the defendant physicians might otherwise be considered state employees when involved in the educational process, they nonetheless stand outside the scope of their employment whenever they engage in the practice of medicine. . . . The provisions of § 152 specifically remove from the scope of governmental immunity those acts of physicians educators and students which fall under the rubric of medical practice. For these acts the physician educators and students are subject to individual tort liability."4 Id. ¶¶ 14, 16, 890 P.2d at 1338--39. In support of their conclusion that resident physicians and interns are individually liable, the Anderson Court pointed to other provisions in the GTCA like section 156(G), which "mandates that claims against resident physicians or interns shall be made in accordance with Titles 12 (civil procedure) and 76 (torts) of the Oklahoma Statutes" rather than in accordance with the notice requirements set out in subsections (A) through (F). Id. ¶ 15 & n.28, 890 P.2d at 1338 & n.28 (citing 51 O.S.Supp.1986, § 156(G)). ¶5 Since Anderson, section 152 has been amended numerous times. Perhaps of most consequence to our analysis is the amendment occurring in 2002 as a result of Senate Bill 1571. That 2002 amendment added both a fourth class of physicians who qualify as state employees under subparagraph (b) and a limiting phrase to the final proviso in subparagraph (c): (b) For the purpose of The Governmental Tort Claims Act, the following are employees of this state, regardless of the place in this state where duties as employees are performed: (1) physicians acting in an administrative capacity, (2) resident physicians and resident interns participating in a graduate medical education program of the University of Oklahoma Health Sciences Center or the College of Osteopathic Medicine of Oklahoma State University, and (3) faculty members and staff of the University of Oklahoma Health Sciences Center and the College of Osteopathic Medicine of Oklahoma State University, while engaged in teaching duties., and (4) physicians who practice medicine or act in an administrative capacity as an employee of this state" Physician faculty members and staff of the University of Oklahoma Health Sciences Center and the College of Osteopathic Medicine of Oklahoma State University not acting in an administrative capacity or engaged in teaching duties are not employees or agents of the state. (c) Except as provided in subparagraph (b) of paragraph 5 of this section, in no event shall the state be held liable for the tortious conduct of any physician, resident physician or intern while practicing medicine or providing medical treatment to patients. Act of June 5, 2002, ch. 462, sec. 2, § 152(5)(b)--(c), 2002 Okla. Sess. Laws 1998, 2000--01. But that new limitation on the proviso did not disrupt the mechanics of how the proviso interacts with the other three classes of physicians set forth in divisions (1), (2), and (3) of subparagraph (b). The Legislature did not tinker with those three classes or add a limitation that specifically referenced everyone in those classes. The simultaneous amendments in subparagraphs (b) and (c) indicate that the Legislature only intended to exclude the class in the new division (4)--which is the only class of "physicians who practice medicine"--from the proviso in subparagraph (c) that renders the State not liable for "tortious conduct . . . [committed] while practicing medicine." If the Legislature had intended to exclude all classes in division (1), (2), (3), and (4) from the effects of the proviso in subparagraph (c), it could have done so with a deletion of the proviso altogether or with clearer language, like that appearing in House Bill 2637 from the same legislative session: (c) In Except for physicians or interns defined as employees by subparagraph b of this paragraph, in no event shall the state or a political subdivision be held liable for the tortious conduct of any physician, resident physician or intern while practicing medicine or providing medical treatment to patients. HB 2637, 48th Leg., 2d Reg. Sess. (Okla. 2002) (enrolled version). House Bill 2637's language never became effective because it was both vetoed by Governor Keating on May 30, 2002, see Okla. H.R. Journal, 48th Leg., 2d Reg. Sess. 1986 (2002), and repealed by the Legislature in Senate Bill 1571, see Act of June 5, 2002, ch. 462, sec. 5, 2002 Okla. Sess. Laws at 2003. Furthermore, if we gave the new introductory limitation effect over all classes of physicians listed in subparagraph (b), it appears the proviso in subparagraph (c) would be rendered meaningless. Why would the Legislature use subparagraph (b) to define all physicians who qualify as state employees and the proviso in subparagraph (c) to specify that the State would never be liable for their tortious conduct while practicing medicine or providing medical treatment, and then use the new introductory limitation to restore the State's liability for all physicians who qualify as state employees? Such an interpretation would fail to give effect to every part of the statute, which is a result we strive to avoid when interpreting statutes.5 Everything points to an interpretation that still renders the proviso in subparagraph (c) applicable to resident physicians and interns. Thus, the holdings in Anderson remain good law even after the 2002 amendment. ¶6 Since 2002, the Legislature has made several more amendments to the definition of a state "employee." None of the amendments changed subparagraph (c), and the Legislature's amendments to subparagraph (b) have only added additional classes of physicians who qualify as state employees. Some of those new classes are physicians who "provide medical care," see 51 O.S.Supp.2017, § 152(7)(b)(5), (7), while other new classes only "perform[] administrative duties," see id. § 152(7)(b)(6). Based on our analysis of the 2002 amendment, the proviso in subparagraph (c) should only apply to those classes whose status as a state employee is not dependent upon their provision of medical care or treatment. None of these more recent amendments have tinkered with the mechanics of how the proviso in subparagraph (c) interacts with the classes of physicians identified in divisions (1), (2), and (3) of subparagraph (b), which includes resident physicians and interns. Thus, the holdings in Anderson remain good law today. ¶7 Second, I wish to point out that nothing in the majority opinion should be viewed as a determination that claims which may be brought against Dr. Hall are subject to the same GTCA notice requirements and are therefore barred for failure to give timely notice. They are not. Section 156 generally sets out the notice requirements that must be met to maintain an action against the State, but subsection (G) sets apart "[c]laims and suits against resident physicians or interns" as different from claims and suits against the State and directs plaintiffs to follow "the provisions of Titles 12 and 76 of the Oklahoma Statutes" in asserting such claims. Moreover, this Court previously held in Lykins v. Saint Francis Hospital, Inc., 1995 OK 135, 917 P.2d 1, that the GTCA's notice requirements do not apply to medical malpractice claims brought against resident physicians or interns. Id. ¶¶ 8, 10, 917 P.2d at 4--5 ("The defendant physicians [which include at least four resident physicians or interns] argue that as state employees within the meaning of the GTCA, they are subject to that Act's notice provisions. . . . The defendant physicians urge that the parents' failure to file with the State a notice of claim bars this tort action. . . . We are not persuaded by the argument advanced by the defendant physicians. . . . We hence reject the notion that the Act's public-tort procedures apply to the parents' claim."). Consequently, if the Crawfords ever pursue claims against Dr. Hall individually, they do not need to comply with the notice provisions in section 156(A) through (E) of the GTCA, nor should they worry about the 1-year deadline in section 156(B). The Crawfords only need to comply with the applicable procedure and deadlines set forth in Titles 12 and 76 of the Oklahoma Statutes. ¶8 Here, the confusion about which entity employed Dr. Hall is a direct result of the deception by perception engaged in by OSUMC, Dr. Hall, Saint Francis Hospital, Inc., and the other Defendants, and that confusion has only served to delay the Crawfords in their attempts to hold the responsible parties accountable. ¶9 In conclusion, the majority opinion does not foreclose any redress against Dr. Sawyer Hall. FOOTNOTES 1 As the majority opinion observes in footnote 6, "[t]he Crawfords have never named Dr. Hall, individually, as a defendant in this lawsuit." Majority Op. ¶ 13 n.6. 2 See generally 51 O.S.2011, § 152.1(A) ("The state . . . and all of [its] employees acting within the scope of their employment, whether performing governmental or proprietary functions, shall be immune from liability for torts."). 3 See generally 51 O.S.Supp.2017, § 153(A) ("The state . . . shall be liable for loss resulting from its torts or the torts of its employees acting within the scope of their employment subject to the limitations and exceptions specified in The Governmental Tort Claims Act . . . ."). 4 Despite their conclusion that the State would not be liable for the medical practice of resident physicians and interns, the Anderson Court recognized that the Legislature had enacted a cap on the amount of their individual liability in section 154 of the GTCA; their liability would be limited to $100,000. Id. ¶ 15 & n.30, 890 P.2d at 1338 & n.30 (citing 51 O.S.Supp.1986, § 154(D), which was renumbered to subsection (E) in 2003). 5 See, e.g., Cole v. Josey, 2019 OK 39, ¶ 3, 457 P.3d 1007, 1009 ("In construing statutes, harmony, not confusion, is to be sought and when parts of an act are reasonably susceptible of a construction which will give effect to both and to the words of each, without violence to either, such construction should be adopted in preference to one which, though reasonable, leads to the conclusion that there is a conflict."); TWA v. McKinley, 1988 OK 5, ¶ 9, 749 P.2d 108, 110 ("Statutes must be interpreted in a manner which renders every word and sentence operative, rather than in a manner which would render a specific statutory provision nugatory."); Darnell v. Chrysler Corp., 1984 OK 57, 687 P.2d 132, 134 ("Every provision of the Constitution and statutes of Oklahoma is presumed to have been intended for some useful purpose and every provision should be given effect."). KAUGER, J., dissenting: ¶1 Four years after §164 was enacted, the Court, in Johns By and Through Johns v. Wynnewood School Bd. of Education, 1982 OK 101, 656 P.2d 248, addressed whether the tolling statute, 12 O.S. 1981 §96 applied to the Governmental Tort Claims Act (the Act). Without regard to the purposes behind the tolling statute,1 or consideration of the court's duty to guard the rights of minors,2 the Court ignored the Okla. Constitution and the Act's clear, explicit, and mandatory language incorporating the laws of the State of Oklahoma into the Act.3 Instead, it held that the minority of the plaintiff when injured did not toll the time limits prescribed by the Act. ¶2 At statehood, the Okla. Const. art. 5, §59, provided, and still does, that: Laws of a general nature shall have a uniform operation throughout the State, and where a general law can be made applicable, no special law shall be enacted.4 In 1910, the Legislature moved to protect persons with disabilities which included minors.5 Then, after decades of attacks on sovereign immunity, the Legislature enacted the Governmental Tort Claims Act. The Act included 51 O.S. Supp. 1978 §164 which provides: The laws and statutes of the State of Oklahoma and the Rules of Civil Procedure, as promulgated and adopted by the Supreme Court of Oklahoma insofar as applicable and to the extent that such rules are not inconsistent with the provisions of this act, shall apply to and govern all actions brought under the provisions of this act. ¶3 It is noteworthy that the tolling statute, 12 O.S. Supp. 1987 §96, has only been amended once since Johns, supra. It provides: If a person entitled to bring an action other than for the recovery of real property, except for a penalty or forfeiture, be, at the time the cause of action accrued, under any legal disability, every such person shall be entitled to bring such action within one (1) year after such disability shall be removed, except that, after the effective date of this section, an action for personal injury to a minor under the age of twelve (12) arising from medical malpractice must be brought by the minor's parent or guardian within seven (7) years of infliction of the injury, provided a minor twelve (12) years of age and older must bring such action within one (1) year after attaining majority, but in no event less than two (2) years from the date of infliction of the injury, and an action for personal injury arising from medical malpractice to a person adjudged incompetent must be brought by the incompetent person's guardian within seven (7) years of infliction of the injury, provided an incompetent who has been adjudged competent must bring such action within one (1) year after the adjudication of such competency, but in no event less than two (2) years from the date of infliction of the injury. The amendments, which are not dispositive of this cause because the injury occurred when the minor was four years old and the cause was filed eight months after the injury occurred, carved out a special tolling period for minors who pursued only medical malpractice claims. In 1991, in Mowles By and Through Mowles v. Hillcrest Heath Center, 1991 OK CIV APP 118, 832 P.2d 24, (cert. denied 6/16/92),6 the Oklahoma Court of Appeals, declared this portion of the special tolling period an unconstitutional special law and ruled that minors bringing medical malpractice claims must be treated to the same limitations as any minor bringing other actions which accrued during minority. ¶4 The Act does not conflict with either the constitution or the statute because, as Johns, supra, acknowledges, the tolling period exception for minors is not mentioned in the Act. The rationale the Court offered to reach its conclusion in Johns, supra, was that because no mention was made of exceptions for minors in the Act, it must be meant to be exclusive to all other laws. This rationale is unconvincing, as the Court later implied in Rout v. Crescent Public Works Authority, 1994 OK 85, ¶¶8-10, 878 P.2d 1045. ¶5 Rout concerned the issue of whether a general attorney fee statute, 12 O.S. 1991 §9407 could be applied to recover attorney fees in negligent or willful injury to property actions brought pursuant to the Act. The Court said that: 1) the Act is the exclusive remedy for an injured plaintiff to recover against a governmental entity for its negligence and that limitations within the Act control over general statutory law; 2) However, the Act is silent regarding attorney's fees and costs, and it does not speak to an award of fees to either party; 3) Subsection 164 provides that the laws and statutes of the State of Oklahoma shall apply to and govern all actions brought under the provisions of this act insofar as applicable and not inconsistent with Act; and 4) The fact that there are no specific provisions within the Act for attorney's fees and costs and 12 O.S. 1991 § 940 specifically authorizes attorney's fees and costs in actions such as this, does not create an inconsistency between the two statutes. ¶6 This is precisely the reasoning the Court should have utilized in Johns, supra. Under Okla. Const. art. 5 §59 and 51 O.S. Supp. 1978 §164, the Legislature did not need to expressly include the minor tolling statute in the Act for the tolling statute to be applicable. The plain reading of the text should have controlled because: 1) The Oklahoma Legislature intervened to protect the rights of children by enacting the minor savings clause in 12 O.S. 1910 §96;8 2) The savings statute serves to toll the applicable statute of limitations until a minor reaches majority; 3) It is the duty of the courts sedulously to guard the rights of minors. No presumption against an infant is permitted; rather every presumption is indulged in his/her favor;9 4) The purpose of the savings statute is to protect the legal rights of those who are unable to assert their own rights due to a disability;10 5) This Court has a longstanding recognition that the statutory rights of minors and incompetents are to be enforced;11 and 6) To allow the statute of limitations to run during the minority of a minor, the very period through which the minor needs and is entitled to the support of parents, defies reason;12 7) Our jurisprudence in every other facet requires that the best interest of the child be considered;13 8) The Court failed to enforce the text of the Constitution and the statute. It was wrong and Johns, supra, and Ross v. City of Shawnee, 1984 OK 43, ¶14, 683 P.2d 535 should be overruled. ¶7 In this cause, the majority opinion notes that several cases have cited Johns, supra for precedential value since it was decided in 1982.14 However, only one of the cases, Ross v. City of Shawnee, 1984 OK 43, ¶14, 683 P.2d 535, concerned the same issue as Johns, supra,15 while the others were cited for other propositions of law.16 Some Courts have held like Johns, supra.17 Others have noted that the purpose of the savings statute is to protect the legal rights of those who are unable to assert their own rights due to a disability, also recognize that allowing the limitations period to run, in a Tort Claims Act, during the minority of a minor, defies reason.18 Regardless of the decisions of other jurisdictions, our Constitution and the incorporating statutory provision of the Oklahoma Governmental Tort Claims Act require only one correct interpretation. The mandatory language must control. CONCLUSION ¶8 Because the Court did not consider the plain text of the Okla. Const. art. 5, §5919 or 51 O.S Supp. 1978 §16420 when it decided Johns, supra, it reached the wrong conclusion. We should not perpetuate this mistake any longer. A plain reading of the texts of the Constitution and statute should be followed and Johns, supra, and Ross v. City of Shawnee, 1984 OK 43, ¶14, 683 P.2d 535, should be overruled. FOOTNOTES 1 Hamilton By and Through Hamilton v. Vaden, 1986 OK 36, ¶16, 721 P.2d 412 [We accept the defendants view regarding the purpose of §96 which is that the Legislature intended §96 to protect the rights of those who by virtue of their legal disabilities are unable to seek redress for their injuries.]. 2 Hamilton By and Through Hamilton v. Vaden, see note 1, supra at ¶14. 3 The Okla. Const. art 5, §59; Title 51 O.S. Supp. 1978 §164, see page 3, infra. 4 Title 12 O.S. 2011 § 2201 provides: A. Judicial notice shall be taken by the court of the common law, constitutions and public statutes in force in every state, territory and jurisdiction of the United States. 5 Title 12 O.S. Supp. 1910 §96 provided: If a person entitled to bring an action other than for the recovery of real property, except for a penalty for forfeiture, be, at the time the cause of action accrued, under any legal disability, every such person shall be entitled to bring such action within (1) year after such disability shall be removed. 6 Also followed by Brown v. Jimerson, 1993 OK CIV APP 158, 862 P.2d 91. 7 Title 12 O.S. Supp. 1979 §940 provides: A. In any civil action to recover damages for the negligent or willful injury to property and any other incidental costs related to such action, the prevailing party shall be allowed reasonable attorney's fees, court costs and interest to be set by the court and to be taxed and collected as other costs of the action. B. Provided that, the defendant in such action may, not less than ten (10) days after being served with summons, serve upon the plaintiff or his attorney a written offer to allow judgment to be taken against him. If the plaintiff accepts the offer and gives notice thereof to the defendant or his attorney, within five (5) days after the offer was served, the offer, and an affidavit that the notice of acceptance was delivered within the time limited, may be filed by the plaintiff, or the defendant, verified by affidavit. The offer and acceptance shall be noted in the journal, and judgment shall be rendered accordingly. If the notice of acceptance is not given in the period limited, the offer shall be deemed withdrawn, and shall not be given in evidence or mentioned at the trial. If upon the action being adjudicated the judgment rendered is for the defendant or for the plaintiff and is for a lesser amount than the defendant's offer, then the plaintiff shall not be entitled to recover attorney's fees, court costs and interest. If the judgment rendered is for the plaintiff, and is for the same amount as the defendant's offer, then the plaintiff and defendant shall incur their own attorney's fees, court costs and interest. And if the judgment rendered is for the plaintiff, and is for a larger amount than the defendant's offer, then the plaintiff shall be entitled to recover attorney's fees, court costs and interest. This statute has not been amended since enacted in 1979. 8 Title 12 O.S. Supp. 1910 §96, see note 5, supra. 9 Hamilton By and Through Hamilton v. Vaden, 1986 OK 36, 721 P.2d 412. It involved the question of whether the minority of a surviving child tolled the limitation period to bring a cause of action for wrongful death of his mother. The Court recognized that courts cannot assume that parents will act effectively to protect the rights of their children; and it is neither reasonable nor realistic to rely upon parents (who may themselves be minors, or who may be ignorant, lethargic, or unconcerned) to bring an action within the time provided. It is equally unreasonable to expect a minor, whose parents fail timely to vindicate his/her legal rights, independently to seek out another adult willing to serve as next friend. To do so would ignore the realities of the family unit and the limitations of children. 10 See, Matter of Estate of Speake, 1987 OK 61, ¶16, 743 P.2d 648 [Not unmindful of the special problems minors and persons of unsound mind may encounter in their quest for judicial relief, the legislature provided a savings clause for persons who stand under such a legal disability.] . 11 Sooner Fed. Sav. & Loan Ass'n, v. Smoot, 1995 OK 31, ¶21, 894 P.2d 1082. 12 A concurring opinion in Pickens v. Donaldson, 748 So. 2d 684, authored by a Justice Sullivan of the Supreme Court of Mississippi, succinctly, and effectively explains why a minor tolling statute should apply to governmental tort claims acts and it is paraphrased as follows: 1) The Legislature, has in the past intervened to protect the rights of children by enacting the minor savings clause; 2) The savings statute serves to toll the applicable statute of limitations until that time when a minor reaches his majority; 3) The purpose of the savings statute is to protect the legal rights of those who are unable to assert their own rights due to disability; 4) To allow the statute of limitations to run during the disability of the minor, the very period through which the minor needs and is entitled to the support of his parents, would defy reason;5) We have previously held that the one-year statute of limitations in the Mississippi Tort Claims Act does not begin to run until the reasonable discovery of the negligence in latent injury cases and Mississippi's children deserve that same courtesy through tolling the statute of limitations to protect their rights during minority; 6) Allowing the statute of limitations to run during minority, "the very period through which the minor needs and is entitled to" the protection of the State, defies reason, and surely was not the intention of our Legislature;7) Our children should be our first priority. Where a choice must be made, it is our children, not our State, who should be safeguarded by our laws; 8) In Marcum v. Hancock County Sch. Dist., 741 So. 2d 234 (Miss.1999), we held that the MTCA was not subject to the minor's savings clause. We were wrong and I would overrule Marcum. I would read the savings clause into the MTCA, and open our courts to children. 13 In Oklahoma, the savings statute applies to many types of cases. In Hamilton v. Vaden, 1986 OK 36, ¶20, 721 P.2d 412, the Court determined that the minority of a surviving child tolled the limitation period of statute which required personal representative to bring action for wrongful death; Richards v. Freeman, 1952 OK 174, ¶0, 247 P.2d 731[Additional two year after majority or removal of disbility is granted to commence action for recovery of realty.]; Bowens v. Poor, 1990 OK CIV APP 112, 805 P.2d 692 [Statutory time limits to determine paternity claims were tolled during child's minority.]; See also, Freeman, v. Alex Brown & Sons, Inc., 73 F.3d 279, 282 (10th Cir. 1996) [tolling statute is applicable to legally-disabled person, regardless of whether the legally-disabled person is represented by a guardian who might otherwise bring action within normal time period.]. 14 The cases are: Hall v. The Geo Group, Inc., 2014 OK 22, n. 26, 324 P.3d 395; Cruse v. Board of County Commissioners of Atoka County, 1995 OK 143, ¶13, 910 P.2d 998; Rout v. Crescent Public Works Authority, 1994 OK 85, n. 12, 878 P.2d 1045; Matter of Estate of Speake, 1987 OK 61, n.14, 743 P.2d 648; Hamilton by and Through Hamilton v. Vaden, 1986 OK 36, n. 31, 721 P.2d 412; Ross v. City of Shawnee, 1984 OK 43, ¶14, 683 P.2d 535. 15 Ross v. City of Shawnee, see note 14, supra, the only other case which also involved the question of whether a minor comply with the 120-day notice provisions of the Act. The Court relied on the holding of Johns, supra, to hold that minors must comply with the 120-day notice provision of the statute. 16 Hall v. The Geo Group, Inc, see note 14, supra, involved a prisoner who was allegedly injured while being transported to a medical appointment by a private prison facility. Two years and two months later, he filed a lawsuit against the prison for negligence, insisting that the limitation period was tolled due to his injury. Johns, infra, was cited in a footnote as follows: "Johns By and Through Johns v. Wynnewood School Bd. of Education, 1982 OK 101, ¶7, 656 P.2d 248 [Provisions of 12 O.S. 1981 §96 do not apply to extend the time to give notice of a claim on behalf of a minor.]." Cruse v. Board of County Commissioners of Atoka County, see note 14, supra, concerned a defendant who sought dismissal of a refiled action. Johns, was determined not to be dispositive. In Rout v. Crescent Public Works Authority, see note 14, supra, the Court stated that it agreed "with Rout concerning the general rules that the Act is the exclusive remedy for an injured plaintiff to recover against a governmental entity for its negligence and that limitations within the Act control over general statutory law. Johns v. Wynnewood School Bd. of Educ., 656 P.2d 248, 258-50 (Okla. 1982). However, the Act is silent regarding attorney's fees and costs, and it does not speak to an award of fees to either party." In Matter of Estate of Speake, see note 10, supra, the dispositive issue was whether the one-year "recommencement-of-actions" provisions in 12 O.S. 1981 § 100, extended the time prescribed in 58 O.S. 1981 §67 to bring a post-probate will contest for a period of one year from the date the initial, timely-filed contest failed otherwise than on the merits. Johns, supra, was used to acknowledge that among the familiar statutes that regulate the time for challenging judicial action or judgment are 51 O.S.Supp. 1986 § 156 which provides time limits for the accrual of a cause of action in favor of a minor under The Governmental Tort Claims Act. In Hamilton By and Through Hamilton v. Vaden see note 13, supra, the Court stated that "defendants concede that the minority status of a child tolls the two year limitation period. The only diversion from the course we have plotted here is found within the provisions of the Political Subdivision Tort Claim Act, 51 O.S. 1981 § 156 . In Johns v. Wynnewood School Bd. of Educ., 656 P.2d 248 (Okla. 1982), a minor was injured while on the school yard playing during recess." 17 For example, Perkins v. ex rel. v. Dallas Center-Grimes, 727 N.2d 377 (Iowa 2007) because the Iowa legislature has never indicated any intent to incorporate a tolling provision into Municipal Tort Claims Act, we decline to do so; In Martinez v. Val Verde County Hospital District, 110 S. Western Rptr. 3d 480 (Court of Appeals of Texas, San Antonio 2003), the Court held that notice period of Texas Tort Claims Act was not tolled during minor's minority; In Martell v. Antelope Valley Hospital Medical Center, 67 Cal. App. 4th 978, 79 Cal. Rptr. 2d 329 (Ct. App. 2nd Dist, California 19998) the Court held that general statute of limitations for medical malpractice actions brought by minors did not apply to actions against public entity under Governmental Tort Claims Act. 18 For example, in South Bend Community Schools Corporation v. Widawski, 622 N.E.2d 160, 162 (Indiana 1993) a minor was injured during a gym class and the Supreme Court of Indiana addressed whether the term "incapacitated," for the purpose of tolling a governmental tort claim, included the status of being a minor. The court held that it did, because minors are clearly restrained in their ability to provide self-care or to fully manage their own property. It reasoned that the legislature would not have provided tort claims notice protections for incapacitated persons yet intend to leave children unprotected. In Gailey v. Jerome County, 745 P.2d 1051, 1053 (Idaho 1987) the Idaho Supreme Court applied the minor savings statute to the governmental tort claims act because Idaho had a long-standing policy to shelter minor plaintiffs from the insensitive ticking of statutory clocks and failure to apply the tolling statute to notice requirements for such tort claims would be immediate, severe, and incongruous with the policy. In Hunter v. Northern Mason High School, 12 Wash. App. 304, 529 P.2d 898, 899 (1974) reached the same conclusion because legal disabilities of minors were established for the protection of minor, and not as a bar to the enforcement of their rights. In Tafoy v. Doe, 100 N.M. 328, 670 P.2d 582 (N.M. Ct. App. 1983), the New Mexico tort claims act, just like Oklahoma's, only expressly gave a tolling extension for anyone incapacitated "by reason of injury." The court concluded that because being a minor alone is a disability which tolls the general statute of limitations, there was no reason why the minor should not be similarly protected when the alleged wrongdoer is a governmental entity. In Hernandez v. City of Boston, 394 Mass. 45, 474 N.E.2d 166, 168 (Mass. Supreme Judicial Ct.) the court held that because the legislature did not provide for a shortened statute of limitations for minor in the tort claims act, the special statute of limitations for minor operated to toll the limitations period for claims brought under the act. It reached this conclusion because nothing in the act indicated an intent to exclude the minor tolling statute from being applicable to the act. 19 The Okla. Const. Art. 5, §59, see page 2, supra. 20 51 O.S. Supp. 1978 §164, see page 3, supra.

a2030e87-21e3-480b-8136-6b64333477f9

In the matter of the Income Tax Protest of Raytheon Company

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE INCOME TAX PROTEST OF RAYTHEON COMPANY2022 OK 32Case Number: 116358Decided: 04/05/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE INCOME TAX PROTEST OF RAYTHEON COMPANY AND SUBSIDIARIES RAYTHEON COMPANY AND SUBSIDIARIES Protestant/Appellant, v. OKLAHOMA TAX COMMISSION, Respondent/Appellee. APPEAL FROM OKLAHOMA TAX COMMISSION ¶0 Corporate taxpayer's 2012 income tax return was due on March 15, 2013. Taxpayer filed its return on September 27, 2013, after securing a statutorily authorized extension of the deadline. Taxpayer later discovered that the return overstated the company's annual income based upon the inadvertent inclusion of Arizona property sales. The taxpayer filed an amended 2012 return on September 27, 2016, claiming a refund of $321,444.00. The Oklahoma Tax Commission denied the refund claim, reasoning taxpayer submitted its demand more than three years after paying the taxes. An administrative law judge found the claimed refund was time barred under 68 O.S.2011, § 2373, and the Commissioners affirmed this finding. Taxpayer appealed and we retained the matter. We now reverse, finding the taxpayer timely brought the claim for refund, having paid taxes to the Oklahoma Tax Commission upon filing its amended original return with a proper extension. OKLAHOMA TAX COMMISSION ORDER NO. 2016-003-24-04 IS REVERSED DAVID ELDER, MATTHEW BROCKMAN, KEVIN B. RATLIFF, Hartzog, Conger, Cason & Neville, Oklahoma City, Oklahoma, Appellant Raytheon Company and Subsidiaries LEE PUGH, ELIZABETH FIELD, SHARON SITZMAN, Oklahoma City, Oklahoma, Appellee State of Oklahoma ex rel. Oklahoma Tax Commission PER CURIAM Facts & Procedural History ¶1 Raytheon Company and Subsidiaries (Raytheon) is the principal reporting corporation for a group of affiliates doing business in Oklahoma. For tax year 2012, Raytheon made estimated tax payments totaling $626,965.00 to the Oklahoma Tax Commission (OTC).1 Raytheon's tax return was originally due on March 15, 2013.2 After properly securing an extension, and making a final quarterly payment of $152,000.00 in March of 2013, Raytheon timely filed its 2012 Oklahoma Corporation Income Tax Return on September 27, 2013. The Form 512-2012 noted an overpayment of $84,456.00, and requested OTC apply the amount to Raytheon's 2013 corporate income tax liability. ¶2 Raytheon subsequently discovered an accounting error which resulted in an overpayment of more than twice the amount of Oklahoma taxes actually owed. Raytheon's original tax return unintentionally included sales of property from Arizona, resulting in an inflated Oklahoma sales factor.3 On September 27, 2016, Raytheon filed its Oklahoma Amended Corporation Income Tax Return (Form 511-X) for 2012, claiming a tax overpayment of $321,444.00. ¶3 On October 5, 2016, the OTC issued a letter denying Raytheon's claim for a refund, maintaining that the amended return "was not filed within the allowed time of three years from the date the tax was paid."4 Raytheon submitted its tax protest on November 22, 2016. After the OTC and Raytheon submitted joint stipulations and independent legal briefs, the assigned administrative law judge issued factual findings and legal conclusions. Therein, the ALJ recommended denying the protest because the refund claim fell outside of the applicable three (3) year period set forth in 68 O.S.2011, § 2373. On August 14, 2017, the OTC issued an order adopting the recommendations of the ALJ. Raytheon filed the present appeal from the OTC decision. We retained the matter and now reverse. Standard of Review ¶4 When the OTC acts in its adjudicative capacity, its orders will be affirmed on appeal if the record contains substantial evidence supporting the facts upon which the order is based and the order is free from legal error. Am. Airlines, Inc. v. State, ex rel. Okla. Tax Comm'n, 2014 OK 95, ¶ 25, 341 P.3d 56, 62. Whether Raytheon's refund claim was time-barred under 68 O.S.2011, § 2373 presents a question of statutory interpretation, and thus involves solely a legal issue which calls for de novo review. Id. Under the de novo standard of review, this Court possesses plenary, independent, and non-deferential authority to examine the issues presented. Matter of Estate of Foresee, 2020 OK 88, ¶ 8, 475 P.3d 862, 865. Analysis ¶5 Both parties acknowledge that the sole question for this Court is how to interpret the following phrase in 68 O.S.2011, § 2373: "portion of the tax paid during the three (3) years immediately preceding the filing of the claim." The parties fundamentally agree that estimated remittances were not "tax paid" within the meaning of the statute.5 Raytheon maintains the three-year period commenced when its original tax return was filed on September 27, 2013. The OTC contends that the three-year term started on March 15, 2013, when the company's tax return was initially due without an extension. To resolve the dispute in this case, we must determine when Raytheon's taxes were considered paid for purposes of § 2373. We begin our analysis with a closer examination of the entire statutory scheme involving corporate income tax in Oklahoma. ¶6 Corporations who do business in, or who derive income from sources within the state, are required to file a corporate income tax return. 68 O.S.2011, §§ 2355(D) and 2368(E). In 2012, corporate entities reporting income on a calendar year basis were required to file their returns by March 15 following the close of the taxable year. 68 O.S.2011, § 2368(G)(3). At the time of submitting an annual income tax return, a corporate taxpayer must simultaneously tender "the amount of tax due." 68 O.S.2011, § 2375(A). Failure to tender the estimated total tax liability causes the tax liability to become delinquent. Id. Nevertheless, taxpayers are statutorily authorized to request an extension for filing a return. 68 O.S. 2011, § 216. Section 216 also provides that "an extension shall not extend the date for payment of the state income or franchise tax due." Id. ¶7 Corporations and individuals who erroneously overpay taxes may seek a refund of the excess sums. 68 O.S.2011, § 2373. As noted, the central statutory provision in this dispute is § 2373, which reads: If, upon any revision or adjustment, including overpayment or illegal payment on account of income derived from tax-exempt Indian land, any refund is found to be due any taxpayer, it shall be paid out of the "Income Tax Withholding Refund Account", created by Section 2385.16 of this title, in the same manner as refunds are paid pursuant to such section. The information filed, reflecting the revision or adjustment, shall constitute the claim for refund. Except as provided in subsection H of Section 23756 of this title, the amount of the refund shall not exceed the portion of the tax paid during the three (3) years immediately preceding the filing of the claim, or, if no claim was filed, then during the three (3) years immediately preceding the allowance of the refund. However, this three-year limitation shall not apply to the amount of refunds payable upon claims filed by members of federally recognized Indian tribes or the United States on behalf of its Indian wards or former Indian wards, to recover taxes illegally collected from tax-exempt lands. In the case of any refund to a member of a federally recognized Indian tribe or to the United States on behalf of its Indian wards or former Indian wards, to recover taxes illegally collected on bonus payments from oil and gas leases located on tax-exempt Indian lands pursuant to this section, the Tax Commission shall pay interest on all refunds issued after January 1, 1996, at the rate of six percent (6%) per annum from the date of payment by the taxpayer to the date of the refund. In cases where the Tax Commission and the taxpayer have signed a consent, as provided by law, extending the period during which the tax may be assessed, the period during which the taxpayer may file a claim for refund or during which an allowance for a refund may be made shall be automatically extended to the final date fixed by such consent plus thirty (30) days. The Oklahoma Tax Commission may authorize the use of direct deposit in lieu of refund checks for electronically filed income tax returns. (Emphasis added). Section § 2373 requires us to examine whether taxes were paid during the three-year period immediately preceding September 27, 2016--the day Raytheon submitted its amended return and claim for a refund. See 68 O.S.2011, § 2385.10 (submission of a return disclosing an overpayment is equivalent to a claim for a refund). To successfully recover an overpayment, Raytheon must have paid any excess taxes within three years of that date. This Court has previously held that the time limit in § 2373 operates as a statute of repose. Neer v. State ex rel. Okla. Tax Com'n, 1999 OK 41, ¶ 2, 982 P.2d 1071, 1073. A taxpayer's claim for refund is the triggering event, and the statute requires us to look back in time from that date. Any taxes paid outside of the three-year window are not recoverable. Id. However, neither § 2373 nor the remainder of the Oklahoma Tax Code prescribe when a tax is considered "paid." ¶8 A logical reading of the plain text in § 2373 supports a determination that taxes are deemed paid when actually tendered to the OTC, even as estimated sums. Yet, the OTC does not dispute Raytheon's claim that quarterly remittances were not actual tax payments, but instead should be regarded as deposits to be applied against a future liability. See 68 O.S.2011, § 2357(A) (providing that estimated taxes and withholdings are applied as a credit); Baral v. United States, 528 U.S. 431, 436-37, 120 S. Ct. 1006, 145 L. Ed. 2d 949 (2000) (explaining that "[w]ithholding and estimated tax remittances are not taxes in their own right, but methods for collecting the income tax."); Rosenman v. United States, 323 U.S. 658, 662, 65 S. Ct. 536, 85 L. Ed. 535 (1945) (recognizing that estimated sums are held as a deposit in the nature of bond rather than as a payment of taxes); see also note 6 supra. Consequently, under § 2373, Raytheon's tax liability was deemed paid either (1) when the original return was filed in September 2013; or (2) when the return was originally due in March 2013. Because § 2373 is subject to more than one reasonable interpretation, we must engage in statutory construction.7 ¶9 A statute is ambiguous when it is susceptible to more than one reasonable interpretation. Kohler v. Chambers, 2019 OK 2, ¶ 6, 435 P.3d 109, 111. When a statute is ambiguous, we will employ statutory canons of construction to determine its meaning. Estate of Foresee, ¶ 14, 475 P.3d at 867. Our primary goal is to ascertain and give effect to the legislative intent and purpose as expressed by the statutory language. Am. Airlines, Inc., ¶ 33, 341 P.3d at 64. Words in a statute are to be construed according to their plain and ordinary meaning unless it is clear the legislature intended a different meaning. Fanning v. Brown, 2004 OK 7, ¶ 10, 85 P.3d 841, 845-46. ¶10 According to the doctrine of in pari materia, statutes regarding the same subject matter are read together, in an effort to give the intended effect to each related provision. Shepard v. Okla. Dep't of Corr., 2015 OK 8, ¶ 15, 345 P.3d 377, 382. "Legislative intent will be ascertained from the whole act in light of its general purpose and objective considering relevant provisions together to give full force and effect to each." Am. Airlines, Inc., ¶ 33, 341 P.3d at 64-65. We are obligated to provide the statute in question a reasonable construction that will avoid absurd consequences. McIntosh v. Watkins, 2019 OK 6, ¶ 4, 441 P.3d 1094, 1096. ¶11 As originally enacted in 1935, Oklahoma's statutory refund provision did not include any time limitation. See O.S.Supp.1936, § 12498z2.8 The Oklahoma Legislature amended the refund statute in 1941, to limit the amount eligible to "the tax paid during the three (3) years immediately preceding the filing of the claim." 68 O.S.1941 § 899. This new verbiage was taken directly from IRC, 26 U.S.C. § 322(b)(2) (1934). The language in § 2373 placing time limits on Oklahoma income tax refunds remains largely unchanged;9 however, the federal refund provisions have been significantly modified.10 ¶12 A taxpayer is authorized to obtain an extension of the deadline to file an Oklahoma income tax return. 68 O.S.2011, § 216. Nevertheless, the OTC argues that 68 O.S.2011, § 216 requires payment of tax by the due date of the income tax return, in this case March 15. Section 216 reads as follows: The Tax Commission, whenever in its judgment good cause exists and pursuant to written request, may grant a reasonable extension for the filing of any return required under any state tax law. The Tax Commission shall keep a record of every extension granted with the reason therefor. Except in the case of corporation income or franchise tax returns, if franchise tax returns are filed at the same time as the corporate tax return, the time for filing any return may not extend in the aggregate later than one-half (1/2) the period of time for which any such return is filed under the particular state tax law involved nor may any such extension extend the date on which any payment of a state tax is due. An extension not to exceed seven (7) months for the filing of corporation income or franchise tax returns, if franchise tax returns are filed at the same time as the corporate income tax return, shall be allowed. Any extension granted for the corporate income tax return shall be deemed to cover the filing of a franchise tax return if a taxpayer elects to file the franchise tax return at the same time as the corporate income tax return. An extension shall not extend the date for payment of the state income or franchise tax due. In case an extension is granted, the taxpayer may file a tentative return on or before the date when the return is required by any state tax law showing the estimated amount of tax for the period covered by the return and may pay the estimated tax or the first installment thereof at the time of filing such tentative return and no interest or penalty shall attach or be payable on sums so paid in due course. The last clause of § 216 relieves the taxpayer from an obligation to pay penalties and interest on sums tendered in connection with an extension. We do not believe § 216 was intended to establish when taxes were deemed paid. Instead, § 216 was enacted to ensure taxpayers accurately calculate estimated taxes and tender the majority of their final expected liability to avoid imposition of interest and penalties. OTC regulations bolster our reading of § 216. Under OAC § 710:50-3-4 (2011), taxpayers are not obligated to tender one-hundred percent of their tax obligation at the time of securing an extension to file a return. This section reads: A valid extension of time in which to file a Federal Income Tax Return automatically extends the due date of the Oklahoma Income Tax Return, unless an Oklahoma liability is owed. A copy of the Federal extension must be attached to the Oklahoma Return. If the due date for filing the Federal Return is not extended or if an Oklahoma liability is owed, an extension of time to file the Oklahoma Return may be granted only by OTC Form 504. Ninety percent (90%) of the tax liability must be paid by the original due date for the return to avoid penalty charges for late payment. Interest will be charged from the original due date of the return. ¶13 The OTC also maintains that 68 O.S.2011, § 2375(A) mandates payment of all tax by the original due date of the return. In truth, we believe this section supports Raytheon's position. Section 2375(A) provides: At the time of transmitting the return required hereunder to the Oklahoma Tax Commission, the taxpayer shall remit therewith to the Tax Commission the amount of tax due under the applicable provisions of Section 2351 et seq. of this title. Failure to pay such tax on or before the date the return is due shall cause the tax to become delinquent. If the return is filed electronically, the amount of the tax due pursuant to the provisions of this article shall be due on or before the twentieth day of April following the close of the taxable year regardless of when the return is electronically filed. The tax shall be deemed delinquent if unpaid after the twentieth day of April if the return is electronically filed. Provided, if the Internal Revenue Code provides for a later due date for returns of individuals, the Tax Commission shall accept payments made with returns filed by individuals by such date and such payments shall be considered as timely paid. (Emphasis added). Thus, under § 2375(A), taxes are deemed due and paid when a return is filed. In this case, Raytheon paid all of the tax due, plus an additional $321,444.00 based on the error it later discovered. It is important to note that this overpayment was not due to any error in assessment made by the OTC. Raytheon's refund request is not based upon questionable tax liability or a dispute between the taxpayer and the OTC. The refund request is not based upon a change in law or a protest with the IRS. No payment was due because the amount of money in question from the sales of property in Arizona should not have been included in the Oklahoma calculation. OTC had no jurisdiction over the Arizona income and could not have attempted to assess liability for that income in the event Raytheon's return was filed without the error. ¶14 Examination of the federal income tax refund scheme is helpful in this case because Oklahoma's system is closely associated with the Internal Revenue Code. See e.g. 68 O.S.2011, § 2353. Title 26 U.S.C. § 6511 reads in relevant part: (a) Period of limitation on filing claim.--Claim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within 2 years from the time the tax was paid. Claim for credit or refund of an overpayment of any tax imposed by this title which is required to be paid by means of a stamp shall be filed by the taxpayer within 3 years from the time the tax was paid. (b) Limitation on allowance of credits and refunds.-- (1) Filing of claim within prescribed period.--No credit or refund shall be allowed or made after the expiration of the period of limitation prescribed in subsection (a) for the filing of a claim for credit or refund, unless a claim for credit or refund is filed by the taxpayer within such period. (2) If the claim was filed by the taxpayer during the 3-year period prescribed in subsection (a), the amount of the credit or refund shall not exceed the portion of the tax paid within the period, immediately preceding the filing of the claim, equal to 3 years plus the period of any extension of time for filing the return. (Emphasis added). Thus, under the IRC, the time for any authorized extension is included in the limitations period for refund claims brought within three years of the date the original return was filed. Notwithstanding, the OTC urges this Court to ignore § 6511 and follow only 26 U.S.C. § 6513(b)(2). This section provides that "[a]ny amount paid as estimated income tax for any taxable year shall be deemed to have been paid on the last day prescribed for filing the return under section 6012 for such taxable year (determined without regard to any extension of time for filing such return)" (emphasis added). Under this section of the IRC, Raytheon's federal taxes would be deemed paid on or about March 15, 2013. The OTC's contention that it should apply to this case ignores the fact that the Oklahoma Tax Code contains nothing similar. OTC's argument also fails because, under the IRC, Raytheon's refund claim would be punctual. It should be noted that the OTC is authorized to make assessments of additional taxes owed "(3) years from the date the return was required to be filed or the date the return was filed, whichever period expires the later." 68 O.S.2011, § 223.11 Hence, the OTC has three years from the date taxpayer files a return to determine if the math is correct. ¶15 Prior opinions dealing with § 2373 do not resolve the precise issue presented here: whether an income tax return filed with an extension affects the date tax is deemed paid. One such case urged by the OTC as support for its position on appeal is Neer v. State ex rel., Oklahoma Tax Commission, 1999 OK 41, 982 P.2d 1071. In Neer, we were asked to examine § 2373 in connection with a refund sought by an Oklahoma taxpayer.12 At issue was whether the Neer's refund request was timely under § 2373. The Neers filed their tax return on its original due date, and admitted the tax was paid when the original return was filed. The Court determined § 2373 was designed to function as a statute of repose, "in the form of an outer time limit boundary--on a taxpayer's right or ability to recover a tax refund." Id. at ¶ 20, 982 P.2d at 1079. Additionally, the Court concluded that the three-year period in § 2373 commenced when the Neers' tax obligation was paid, and affirmed the OTC's denial of the refund. Id. at ¶ 24, 982 P.2d at 1080.13 Nothing in Neer helps us resolve the question we face in the present matter. ¶16 Further examination of our prior decisions reflects the uncertainty around the deemed-paid date. For example, in Manhattan Const. Co. v. Oklahoma Tax Commission, we explained that estimated payments are not taxes paid "but simply constituted a deposit to be applied on the tax after the close of the taxable year and upon the filing of a return." 1951 OK 14, ¶ 15, 233 P.2d 279, 282. Thus, Manhattan Const. supports a finding that the deemed-paid date is the date of filing, not the original due date. In Oklahoma Tax Commission v. Oven, the Court concluded that "the [filed] return, tender, and acceptance" prior to the original due date, "constituted a payment." 1959 OK 79, ¶ 17, 338 P.2d 1095, 1098; see also 68 O.S.2011, § 2375(A). ¶17 Raytheon contends that as a tax statute, § 2373 should be strictly construed against the State, citing Strelecki v. Okla. Tax Comm'n, 1993 OK 122, ¶ 20, 872 P.2d 910, 920.14 Because were are able to ascertain legislative intent applying general canons of construction, we need not apply a presumption either in favor of or against the taxpayer. See TOMRA of N. Am., Inc. v. Dept. of Treasury, 952 N.W.2d 384, 389 (Mich. 2020) (quotation & footnote omitted) the Court explained: We take this opportunity to clarify that because the canon requiring strict construction of tax exemptions does not help reveal the semantic content of a statute, it is a canon of last resort. That is, courts should employ it only when an act's language, after analysis and subjection to the ordinary rules of interpretation, presents ambiguity. See also City and Cnty. of Denver v. Expedia, Inc., 405 P.3d 1128, (Colo. 2017) (concluding "policy preference regarding tax burdens was never intended to displace other canons designed to help resolve doubts, or ambiguity."); America, Inc. v. Department of Treasury, State v. Thonesavanh, 904 N.W.2d 432, 440 (Minn. 2017) (noting that the rule of lenity only applies after traditional canons of construction have been exhausted; also recognizing "[i]t is not. . . some sort of grand canon that towers over all the others and allows a defendant to prevail in every instance in which a criminal statute is ambiguous."). ¶18 There is no dispute that Raytheon substantially overpaid its income taxes. After examining our prior decisions, related state and federal statutes, and OTC regulations pertaining to tax refunds, we hold that Raytheon's taxes were deemed paid when it filed its 2012 return on September 27, 2013. Therefore, the claim for refund is timely. By resolving this dispute in favor of the taxpayer, we are best able to harmonize §§ 216, 2373 and 2375, and to carry out legislative objectives in the comprehensive statutory scheme. First, a taxpayer is statutorily authorized to request an extension to file the required income tax return. If we utilize the original due date for a tax return, without regard to an extension, we would impede a taxpayer's statutory right to extend the deadline. Second, by utilizing the filing date in this case Raytheon is better able to submit the most complete picture of the company's income and tax obligation. It makes little sense to consider the taxes paid prior to presentation of an income tax return.15 Our decision is also consistent with 68 O.S.2011, § 2375, which provides that payment is due when a return is filed. Third, under OTC regulations a taxpayer is not required to have tendered one-hundred percent of their tax obligation at the time an extension is sought. See OAC, § 710:50-3-4 (2011) (requiring payment of ninety percent (90%) of the total tax liability by the original due date to obtain an extension and to avoid penalties). This regulation is an acknowledgment that estimated payments are merely an approximation of a taxpayer's total liability. The statutes and regulations merely impose a due diligence requirement on a taxpayer to avoid underestimating their tax obligation. Finally, our conclusion is consistent with the federal refund scheme, which includes the period of any extension to file an income tax return. Conclusion ¶19 We hold Raytheon's corporate income tax liability was paid when the company filed its Oklahoma Corporation Income Tax Return on September 27, 2013. A timely claim for a refund was submitted on September 27, 2016, when Raytheon filed its Oklahoma Amended Corporation Income Tax Return. Therefore, Raytheon's claimed income tax refund was timely under 68 O.S. 2011, § 2373, and the Oklahoma Tax Commission erred when it determined Raytheon's refund claim time barred. OKLAHOMA TAX COMMISSION ORDER NO. 2016-003-24-04 IS REVERSED KANE, V.C.J., KAUGER (BY SEPARATE WRITING), EDMONDSON, COMBS, GURICH, ROWE, AND KUEHN, JJ., AND REIF, S.J., CONCUR; DARBY, C.J., CONCURS IN RESULT (BY SEPARATE WRITING); WINCHESTER, J., DISQUALIFIED. FOOTNOTES 1 Estimated payments were tendered on June 19, 2012 ($115,000.00); September 20, 2012 ($266,000.00); October 22, 2012 ($61,519.00 overpayment from 2011 credited); December 17, 2012 ($32,000.00); March 18, 2013 ($152,000.00); and October 8, 2013 ($446.00). 2 68 O.S.2011, § 2368(G)(3) required corporate tax returns to be filed "on or before the fifteenth day of March following the close of the taxable year." 3 Total income attributable to a unitary company's business in Oklahoma is calculated using an apportionment formula. This formula is comprised of several figures, including the Oklahoma sales factor. 68 O.S.2011, § 2358 (A)(5). 4 Joint Stipulation of Facts and Issues, Letter from O.T.C., Ex. 6, R.O.A. at p. 36. 5 Although this legal conclusion was not one of the stipulations submitted by the parties, OTC's assertion that taxes are deemed paid on the initial due date for Raytheon's return is a tacit concession that estimated sums submitted to the OTC in 2012 were not "paid" when tendered. 6 68 O.S.2011, § 2375(H) is not applicable to the facts of this proceeding. 7 The OTC maintains that § 2373 is not ambiguous by virtue of our holding in Neer v. State ex rel. Okla. Tax Comm'n, 1999 OK 41, 982 P.2d 1071. However, the Neer decision found that § 2373 contained "no inconsistency, ambiguity, or uncertainty. . . .in relation to the issue before us." Id. ¶ 16, 982 P.2d at 1078 (emphasis added). The Neer opinion did not consider when estimated taxes or withholdings are deemed paid for purposes of § 2373. In fact, the Neers conceded the date their taxes were paid; the only questions were whether § 2373 represented a statute of limitations or statute of repose, and whether the Neers' refund claim was untimely. See infra ¶ 14 of this opinion. 8 This unique citation format was utilized in the 1936 version of the Oklahoma Statutes. 9 Ultimately, the refund section was renumbered as 68 O.S. § 2373. Title 68 O.S.1941, § 899 was repealed and renumbered as 68 O.S.Supp.1965, § 2322 by H.B. 687, 1965 Okla. Sess. Laws, Ch. 530, p. 1088, 1117. In 1971, the Legislature passed H.B. 1191, 1971 Okla. Sess. Laws, Ch. 137, § 23, p. 410, 429, as corrected by H.J. Res. 1026, §2A24, p. 1043, 1971 Okla. Sess. Laws (emerg. eff. Jun., 22, 1971), which renumbered 68 O.S.Supp.1965, § 2322 as 68 O.S.1971, § 2373. 10 Initially, the federal refund provisions were codified at 26 U.S.C. § 322, which provided that refunds were limited to "the portion of the tax paid during the three years immediately preceding the filing of the claim." 26 U.S.C. § 322(b)(2) (1934). Congress included § 322(b)(2) as written in the Internal Revenue Code of 1939. In the 1940s, Congress modified § 322 to add language pertaining to when withheld and estimated taxes are deemed paid. See Revenue Act of 1942, Pub. L. No. 77-753, ch. 619, § 169(a), 56 Stat. 790, 876. With the Revenue Act of 1942, Congress added language to provide that estimated sums shall be deemed paid "on the last day prescribed by law," which "shall be determined without regard to any extension of time." § 169(a), 56 Stat. at 877. In 1954, Congress enacted the Internal Revenue Code of 1954, and the federal refund provisions were renumbered as 26 U.S.C. §§ 6511, 6513. Internal Revenue Code of 1954, Pub. L. No. 83-591, ch. 736, 68A Stat. 3, 808-12 (codified at 26 U.S.C. §§ 6511, 6513 (1954)). The 1954 Act likewise provided that estimated sums shall be deemed paid "on the last day prescribed for filing the return under section 6012 for such taxable year (determined without regard to any extension of time for filing such return)." Id. Section 6511 was amended in 1958, to enlarge the look-back period for tax refunds, to wit: "the amount of the credit or refund shall not exceed the portion of the tax paid within the period, immediately preceding the filing of the claim, equal to 3 years plus the period of any extension of time for filing the return." Technical Amendments Act of 1958, Pub. L. No. 85-866, § 82(b), 72 Stat. 1606, 1663 (codified as amended at 26 U.S.C. § 6511(b)(2)(A)). 11 See also 68 O.S.2011, §2385.16, which provides a limitations period, marked from the date of the filing of the return, for requesting that a refund be re-issued. 12 On April 15, 1992, Dr. Neer and his wife filed their 1991 individual Oklahoma return. Id. ¶ 6, 982 P.2d at 1074. In June of 1994, the Neers were notified by the State of New York that certain retirement benefits they had received in 1991 were subject to taxation in that state. Id. ¶¶ 5-7, 982 P.2d at 1074. Initially, the Neers disputed the New York assessment; however, after their tax challenge was exhausted the Neers paid the liability in September 1995. Id. ¶ 8, 982 P.2d at 1074. In November of 1995, the Neers filed an amended Oklahoma return and sought a refund for overpayment of their 1991 income taxes. Id. ¶ 9, 982 P.2d at 1074-75. Finally, the Court reasoned that the Neers had paid their income tax when they filed their return in April of 1992; thus, regardless of the unforeseen tax liability in New York, the Neers' claim was extinguished three years after filing their return. Id. at ¶ 24, 982 P.2d at 1080. 13 But cf. Matlock v. State ex rel. Okla. Tax Comm'n, 2001 OK CIV APP 104, ¶ 3, 29 P.3d 614, 615 (finding 68 O.S. § 2373 and Okla. Admin. Code § 710:50-9-2 barred individual taxpayers claim for a refund because it was filed more than three years after original due date). Matlock is inapposite because (1) the taxpayers in that case failed to timely file a return when originally due and did not request an extension; and (2) taxpayers were individuals and not corporations. Thus § 710:50-9-2 specifically applied to the facts presented. Notwithstanding, OTC noted in its Answer Brief that the agency is not relying on Okla. Admin. Code § 710:50-9-2 to reach its conclusion that Raytheon's refund claim is out of time. Appellee's Answer Brief, p. 12. 14 The sole question presented in Strelecki was whether a U.S. Supreme Court decision was entitled to retroactive application for purposes of the refund claim, not whether § 2373 was ambiguous or capable of two reasonable interpretations. Strelecki, ¶ 3, 872 P.2d at 912. On appeal, for the first time, the OTC argued that under 68 O.S. §§ 2373 and 2375, the agency was without authority to issue a tax refund for voluntary overpayments (not under protest). Id. ¶ 16, 872 P.2d at 919. Neither statute was alleged to contain a purported ambiguity under the facts in Strelecki. Although the Strelecki decision involved a refund claim, the Court's recitation of the "strict construction" requirement not consistent with other Oklahoma authority. For example, in R.R. Tway, Inc., v. Oklahoma Tax Commission, 1995 OK 129, ¶ 26, 910 P.2d 972, 978 (citations omitted) the Court stated: In effect, the refund is similar to a tax deduction or exemption reducing tax liability for those taxpayers who decide to use it. Tax exemptions and deductions are matters of legislative grace subject to the controlling authority of either the Constitution or the Oklahoma Constitution. Because the exemption is granted by, and within the power of, the Legislature, a court will not construe a tax exemption so as to enlarge its scope. 15 As mentioned previously, OTC is authorized to make assessments of additional taxes owed the later of (1) three years from the date the return was required to be filed; or (2) three years from the date a return was filed. 68 O.S.2011, § 223. KAUGER, J., concurring specially: ¶1 I agree with the majority, but because the taxpayer is not seeking a refund from any property with any Oklahoma taxable situs, this cause is also about a mistake, or a scrivener's error including property in which Oklahoma has no jurisdiction. Property must have either an actual or constructive situs within a state in order to give it a taxable situs in the state. A state has power to fix the time at which property within its jurisdiction may acquire a taxable situs, but it cannot fix the taxable situs of a thing which has never come into the state and over which it is without power to control. In re Harkness' Estate, 1921 OK 329, ¶0, 204 P. 911; Pappas v. Guaranty Securities, Co., 1923 OK 556, ¶0, 217 P. 474; McIntosh v. Advance-Rumley Thresher Co., 1926 OK 438, ¶0, 246 P. 403. ¶2 This is not the typical or ordinary tax refund proceeding. It is a recoupment proceeding for the restoration of monies improperly obtained by the OTC which resulted in an unjustly enriched windfall of money which it had no authority to collect. Title 68 O.S. 2011 §202 defines a "state tax" as "any tax which is payable to, collectible by or administered by the Oklahoma Tax Commission."1 When a taxpayer submits money to the OTC to secure compliance with tax laws, and the tax indebtedness has been paid, the OTC is required to return the money. ¶3 Pursuant to the "Uniform Tax Procedure, 68 O.S. 2011 §211, the OTC is directed to return money deposited in excess of the tax payer's liability when it was paid by the taxpayer to secure compliance with tax laws. It provides: When, to secure compliance with the provisions of this article or any other State tax law, money or securities have been deposited with the Tax Commission, and the Tax Commission is satisfied that the taxpayer has complied with all tax laws and has, through independent payment or through authorization granted by the taxpayer to the Tax Commission to satisfy such tax indebtedness out of the money or securities deposited, paid all taxes due the State, then the Tax Commission shall return to the owner all or such part of the deposited money or securities as remains after the liquidation of taxpayer's tax liability. If such money or securities have by the Tax Commission been deposited with the State Treasurer, then the Tax Commission shall, under the circumstances above stated, notify the Treasurer that the money or securities, or such part as the Tax Commission shall direct, should be returned to the owner. (Emphasis supplied.) ¶4 This is precisely what happened here. Neither party relies on this statute, but we are required to take judicial notice of 68 O.S. 2011 §211,2 and the Court should address it and reconcile it with the other provisions in the tax code. The provisions of §211 do not refer to refunds, time limits for refunds, or due dates for extensions and returns. The statute applies to the unique circumstances of this cause and the money is required to be returned. CONCLUSION ¶5 This State has long required prompt payment of a tax as a condition precedent for testing the validity of the tax, and the fundamental fairness of such a requirement rests on the taxpayer's ability to eventually receive a refund of invalid taxes.3 The State's integrity requires that when a statutory tax refund is due, it must be paid, and procedures must be found to accomplish that purpose.4 Likewise, the State's integrity should require that money paid in error to it, money in which it had no authority over, must be returned. Procedures are in place to accomplish such a payment. Title 68 O.S. 2011 §211 requires return for the unauthorized money, and §225 provides a taxpayer a legal remedy for the return of the unauthorized money it submitted.5 FOOTNOTES 1 Title 68 O.S. 2011 §202 provides in pertinent part: The terms defined in this section shall, in this article, be construed as follows: (a) The term "Tax Commission" shall mean the Oklahoma Tax Commission; (b) The term "state tax" shall mean any tax which is payable to, collectible by or administered by the Oklahoma Tax Commission; . . . 2 12 O.S. 2011 §2201(A): A. Judicial notice shall be taken by the court of the common law, constitutions and public statutes in force in every state, territory and jurisdiction of the United States. 3 Exchange Oil Co. v. State, 1920 OK 80, ¶8, 193 P. 999. 4 Art. 2, §6 of the Oklahoma Constitution provides: The courts of justice of the State shall be open to every person, and speedy and certain remedy afforded for every wrong and for every injury to person, property, or reputation; and right and justice shall be administered without sale, denial, delay, or prejudice. Continental Oil Co. v. Oklahoma Tax Commission, 1972 OK 30, ¶16, 494 P.2d 650. 5 Title 68 O.S. 2011 §211, see page 3, infra. Title 68 O.S. 2011 §225 of the Tax Code relates to appeals to this Court and the district court, and it provides in pertinent part: G. If the appeal be from an order, judgment, finding, or ruling of the Tax Commission other than one assessing a tax and from which a right of appeal is not otherwise specifically provided for in this article the Uniform Tax Procedure Code, any aggrieved taxpayer may appeal from that order, judgment, finding, or ruling as provided in this section. The filing of such an appeal shall supersede the effect of such order, judgment, ruling, or finding of the Tax Commission. H. This section shall be construed to provide to the taxpayer a legal remedy by action at law in any case where a tax, or the method of collection or enforcement thereof, or any order, ruling, finding, or judgment of the Tax Commission is complained of, or is sought to be enjoined in any action in any court of this state or the United States of America. DARBY, C.J., concurring in result: ¶1 I concur in the Court's result that Raytheon's 2012 amended corporate income tax return was timely filed within three (3) years of the tax being paid, but write separately to explain my understanding of this Court's rules of construction with respect to revenue or tax statutes. Revenue statutes, those designed to raise funds for the operation of government, are penal in nature and are strictly construed against the state in cases of ambiguity. Globe Life & Accident Ins. Co. v. Okla. Tax Comm'n, 1996 OK 39, 913 P.2d 1322, 1326-27. The opposite is true--that a statute is strictly construed against the taxpayer--when the taxpayer claims an exemption or credit. See TPQ Inv. Corp. v. State ex rel. Okla. Tax Comm'n, 1998 OK 13, ¶ 8, 954 P.2d 139, 141 (the taxpayer's amended tax return claiming a refund because of an investment credit must be strictly construed against the credit). In those cases the tax would be authorized under the tax statutes, but is specifically excepted from the levy by legislative grace. Id. But that is not the case here; Raytheon's refund is not the result of a claimed exemption or credit. Instead Raytheon's claim involves the refund of excess corporate income tax paid in error based on the miscalculation of its sales apportionment factor. ¶2 In my view the statutes that relate to the filing of the return, the payment of the tax, and claim for refund put in issue three relevant dates: the required due date for filing the corporate income tax return; the required due date for the payment of the tax; and the date the tax liability is actually paid. In this case there are ambiguities in determining when a tax is considered "paid," 68 O.S. §2373, and the date a required return must be transmitted remitting "the amount of tax due." 68 O.S. §2375(A). The due date for the payment of the tax and the date the tax liability is actually paid are not necessarily the same. The Tax Code, 68 O.S. §101 et seq., contemplates as much as evidenced by the significant penalties to be imposed in the event a taxpayer is delinquent or the amount of tax paid is deficient. See e.g., 68 O.S. §2375(B) (imposing a 5% penalty of the total amount of the tax due if delinquent), 68 O.S. §2375(C) (imposing a 25% penalty for a deficiency in certain circumstances), 68 O.S. §217(A) (imposing a 1.25% per month delinquent tax interest accruing until paid), and 68 O.S. §217(D) (imposing an additional 10% penalty if taxpayer fails to pay the delinquent tax within 30 days of the tax becoming delinquent). ¶3 The Tax Commission makes much of when a tax is delinquent to support their conclusion that a tax is "deemed paid" on the original due date of the return--the original due date of the return being the date required as set out in 68 O.S. §2368. Under section 2368(G)(3), Raytheon's 2012 Corporate Income Tax Return was due on March 15, 2013. In conjunction with this statute, the Tax Commission points to section 216 and the statement that "[a]n extension shall not extend the date for payment of the state income tax due." 68 O.S. §216. The Commission takes the position that taxes are delinquent if not paid on the original due date, the date prescribed in section 2368. So in order to timely file a claim for refund of corporate income taxes, Raytheon would have been required to file its amended return within 3 years of this date, regardless of whether a taxpayer had a valid extension. ¶4 Raytheon, however, relies on section 2375 to support its conclusion that the tax is paid when the return is filed and the liability established. Section 2375 provides that "[a]t the time of transmitting the return required . . . the taxpayer shall remit . . . the amount of tax due. . . ." and "[f]ailure to pay such tax on or before the date the return is due shall cause the tax to become delinquent." 68 O.S. §2375(A). ¶5 In most cases, a valid federal extension "automatically extends the due date of the Oklahoma Income Tax Return. . . ." OKLA. ADMIN. CODE §710:50-3-4. The Commission may grant an extension to file any return required under state law; that is, the OTC may extend the required due date for filing the corporate income tax return. See 68 O.S. §216 ("The Tax Commission . . . may grant a reasonable extension for the filing of any return required under any state law."). ¶6 Section 216 is found in the Uniform Tax Procedure Code, 68 O.S. §201 et seq., and its language is to control "[u]nless otherwise expressly provided in any state tax law. . . ." 68 O.S. §201. In the Income Tax Code, section 2375(A) says "[f]ailure to pay such tax on or before the date the return is due shall cause the tax to become delinquent." 68 O.S. §2375(A). And section 2375(B) says if income tax "is not paid on or before the date such tax becomes delinquent, a penalty of five percent (5%) of the total amount of the tax due shall be added thereto, collected and paid." 68 O.S. §2375(B). ¶7 There then appears to be a conflict between the following statutes and administrative rule about when a tax is considered delinquent: sections 2375(A) and (B), the OTC's interpretation of section 216, and OKLA. ADMIN. CODE §710:50-3-4. ¶8 It is unclear to me how the majority finds section 2373 ambiguous, Op. ¶ 7, resolves the ambiguity by generalized recitations of rules of statutory construction, Op. ¶¶ 8-9, but later discerns the ability to ascertain legislative intent as to section 2373, Op. ¶ 16. ¶9 I agree that section 2373 is ambiguous regarding when a tax is "paid." Additionally, it appears to me that section 2375 is ambiguous concerning when a return is required to be transmitted with the "amount of tax due." Section 2375 could reasonably mean the return was required to be filed on the "original due date" set out in section 2368, or mean the required due date as extended by either an IRS extension or OTC extension. ¶10 In my view, however, because ordinary cannons of statutory construction do not resolve those ambiguities, I would apply this Court's well-established rule of interpretation regarding tax statutes--that in the case of any ambiguity or doubt, this Court strictly construes tax statutes in favor of the taxpayer, the individual/entity upon whom the burden of the tax is sought to be imposed. McGannon v. State, 1912 OK 384, ¶¶ 18-19, 124 P. 1063, 1067 (internal citations omitted). See also Assessments for Tax Year 2012 of Certain Props. Owned by Throneberry v. Wright, 2021 OK 7, 481 P.3d 883; Video Gaming Techs., Inc. v. Tulsa Cty. Bd. of Tax Roll Corr., 2019 OK 84, 455 P.3d 918; Williams v. Smith & Nephew, Inc., 2009 OK 36, 212 P.3d 484; Samson Hydrocarbons Co. v. Okla. Tax Comm'n, 1998 OK 82, 976 P.2d 532; Sherrill v. Deisenroth, 1975 OK 136, 541 P.2d 862; Western Auto Supply Co. v. Okla. Tax Comm'n, 1958 OK 144. I disapprove of the majority's analysis that borrows case law from other jurisdictions to casually avoid this well-established rule of construction, especially when the case law cited therein refers to tax exemptions or criminal statutes. Op. ¶ 15. Raytheon does not claim it overpaid taxes because it failed to include an exemption in its original return, instead the refund was requested due to an error in calculating its sales factor. The overpayment of taxes was never within the corporate income tax levy of the Oklahoma Tax Code. The tax was "paid" within 3 years of the filing of the claim for refund. I agree Raytheon's claim for refund is not barred by statute.

edbafa7a-2208-4dc7-87be-6ad589746e57

Barnett v. Okay Public Works Authority

oklahoma

Oklahoma Supreme Court

BARNETT v. OKAY PUBLIC WORKS AUTHORITY2022 OK 24Case Number: 117792Decided: 03/08/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. VICKY BARNETT, individually and d/b/a RIVER VALLEY MOBILE HOME COMMUNITY, Plaintiff/Appellee, v. THE OKAY PUBLIC WORKS AUTHORITY, a public trust, Defendant/Appellant, v. L.L.G. CONSTRUCTION, INC. and WESTERN SURETY CO., Third-Party Defendants. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION III ¶0 The Okay Public Works Authority (OPWA) appeals a jury verdict in an inverse condemnation lawsuit. The jury found that a taking occurred when OPWA installed wastewater sewer lines in a mobile home community. The Court of Civil Appeals reversed the district court's judgment holding OPWA did not possess the power of eminent domain over the installation of wastewater sewer lines. This Court granted certiorari. We hold that the Legislature granted eminent domain power to OPWA for the transportation, delivery, treatment, and furnishing of water for domestic purposes, which included the power to install wastewater sewer lines in the mobile home community. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT AFFIRMED. Steven M. Harris and S. Max Harris, Doyle Harris Davis & Haughey, Tulsa, Oklahoma, for Defendant/Appellant. K. Ellis Ritchie, Ritchie, Rock, McBride & Atwood Law Firm, Pryor, Oklahoma, for Plaintiff/Appellee. Winchester, J. ¶1 The issues before this Court are (1) whether Appellant Okay Public Works Authority (OPWA) possessed the power of eminent domain over a sanitary system improvement project performed on a mobile home community in the Town of Okay, Oklahoma, and (2) whether the subject project was for public use. We answer these questions in the affirmative. ¶2 The Oklahoma Legislature granted eminent domain power to public trusts for the transportation, delivery, treatment, and furnishing of water for domestic purposes. 60 O.S. Supp.2006, § 176(J) (superseded).1 The publicly-funded sanitary system improvement project in Okay involved the installation of pipelines on the premises of a mobile home community (and other properties) to transport, deliver, and treat wastewater and sewage, a project that falls within the eminent domain power granted by § 176(J). Because the project involved the provision of utilities for Okay, the project was for public use. We hold OPWA possessed the power of eminent domain over the sanitary system improvement project performed on the mobile home community. FACTS AND PROCEDURAL HISTORY ¶3 OPWA is a public trust, pursuant to 60 O.S.2021, Ch. 4, §§ 176-180.4, https://govt.westlaw.com/okjc (In ch. 4, follow hyperlink titled "Trusts for Furtherance of Public Functions"), that supplies utilities, including a sanitary system and a water treatment plant, for Okay, Oklahoma. The sanitary system services approximately 225 residences. In 2009, OPWA began a sanitary system improvement project with public funds obtained from the Oklahoma Water Resources Board. This project included the replacement and relocation of wastewater sewer lines and the extension of lines from the water treatment plant. ¶4 OPWA expanded the sanitary system improvement project from adjacent land onto the River Valley Mobile Home Community (River Valley), owned by Appellee Vicky Barnett (Barnett). OPWA began excavating on the premises of River Valley without obtaining permission from Barnett or giving notice. OPWA's engineer hired to design the sanitary system improvement project informed OPWA that a new easement was required for the portion of the project on the River Valley premises, but OPWA failed to obtain one. ¶5 As part of the project, OPWA installed a sewer main line across the southern part of the River Valley premises and replaced the private lines servicing the mobile homes with lines tied into OPWA's project. The new wastewater sewer lines installed on the River Valley premises served a convenience store on adjoining property to the east of River Valley. OPWA also installed wastewater sewer lines on the adjoining subdivision to the west of River Valley, which tied into lines that served both River Valley and the convenience store. OPWA obtained public utility easements on the adjoining properties where it installed its wastewater sewer lines. ¶6 The work performed by OPWA caused extensive damage to the River Valley premises near the excavation area. Further, during and upon completion of the project, sewage did not drain properly from the mobile homes. Barnett discovered the lines installed by OPWA had not been properly graded. ¶7 Barnett brought this action against OPWA alleging inverse condemnation for the property taken and damaged by OPWA.2 The district court held a jury trial, and the jury returned a verdict in favor of Barnett, awarding her $73,350 in damages for inverse condemnation. OPWA moved for judgment notwithstanding the verdict (JNOV) or, in the alternative, a new trial, arguing it did not possess the power of eminent domain over the installation of the wastewater sewer lines. The district court denied OPWA's motion. The district court then entered a journal entry of judgment and granted OPWA an easement on the River Valley property. OPWA appealed. ¶8 The Court of Civil Appeals (COCA) reversed the district court's judgment. Construing 60 O.S.Supp.2006, § 176(J) (superseded), COCA found that OPWA did not possess the power of eminent domain over the subject project. COCA explained that a public trust has the authority to invoke eminent domain for the purposes of the "furnishing of water for domestic purposes" and concluded that this power does not extend to projects involving wastewater sewer lines. This Court granted certiorari. STANDARD OF REVIEW ¶9 The standard of review for a motion for JNOV is identical to the standard for determining a motion for a directed verdict. 12 O.S.2011, § 698. This Court considers as true all evidence favorable to the non-moving party together with all inferences that may be reasonably drawn, and we disregard all conflicting evidence favorable to the moving party. First Nat'l Bank in Durant v. Honey Creek Entm't Corp., 2002 OK 11, ¶ 8, 54 P.3d 100, 103. A district court should grant a motion for JNOV only when there is an entire absence of proof on a material issue. Id. We will not disturb a judgment on appeal unless it is apparent that the district court erred on a pure question of law or acted arbitrarily. Dominion Bank of Middle Tenn. v. Masterson, 1996 OK 99, ¶ 16, 928 P.2d 291, 294. ¶10 The issues in this appeal also concern the legal interpretation of Oklahoma's statute regarding the eminent domain powers of a public trust, 60 O.S. Supp.2006, § 176(J) (superseded). Statutory construction poses a question of law; the correct standard of review is de novo. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. Under the de novo standard of review, the Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. Id. DISCUSSION ¶11 OPWA argues that Barnett's inverse condemnation claim fails as a matter of law because (1) OPWA lacked the power of eminent domain over the sanitary system improvement project performed on the River Valley premises and, as a result, OPWA does not own the wastewater sewer lines installed, and (2) the subject project was not for public use. We address each of these arguments in turn. I. OPWA possessed the power of eminent domain to install wastewater sewer lines as part of the sanitary system improvement project on the River Valley premises. ¶12 The Oklahoma Constitution guarantees that private property will not be taken or damaged for public use without just compensation. Okla. Const. art. 2, § 24. When a governmental entity takes or damages private property without just compensation, a person may bring an inverse condemnation claim. State ex rel. Dep't of Transp. v. Post, 2005 OK 69, ¶ 7, 125 P.3d 1183, 1186. An essential element of an inverse condemnation claim is that the taking or damage occurred from an action taken by a governmental entity that holds the power of eminent domain. Drabek v. City of Norman, 1996 OK 126, ¶ 4, 946 P.2d 658, 659. To determine whether OPWA had the power of eminent domain over the sanitary system improvement project performed on the River Valley premises, we first examine Oklahoma's statute regarding the eminent domain power of a public trust. ¶13 When the Court examines a statute, our primary goal is to determine legislative intent through the "plain and ordinary meaning" of the statutory language. In re Initiative Petition No. 397, 2014 OK 23, ¶ 9, 326 P.3d 496, 501. Because the Legislature expresses its purpose by words, the plain meaning of a statute is deemed to express legislative authorial intent in the absence of any ambiguous or conflicting language. Id. A judicial determination of the presence of more than one reasonable construction of the statutory language, i.e., ambiguity, presents a question of law. Id. Oklahoma's statute regarding a public trust's eminent domain power provides in pertinent part: J. Any public trust created pursuant to the provisions of this section shall have the power to acquire lands by use of eminent domain in the same manner and according to the procedures provided for in Sections 51 through 65 of Title 66 of the Oklahoma Statutes. Any exercise of the power of eminent domain by a public trust pursuant to the provisions of this section shall be limited to the furtherance of public purpose projects involving revenue-producing utility projects of which the public trust retains ownership; provided, for public trusts in which the State of Oklahoma is the beneficiary the exercise of the power of eminent domain may also be used for public purpose projects involving air transportation. Revenue-producing utility projects shall be limited to projects for the transportation, delivery, treatment or furnishing of water for domestic purposes or for power, including, but not limited to, the construction of lakes, pipelines and water treatment plants or for projects for rail transportation. 60 O.S.Supp.2006, § 176(J) (superseded) (emphasis added). The provisions of § 176(J) are to be strictly construed. Bd. of Cty. Comm'rs of Muskogee Cty. v. Lowery, 2006 OK 31, ¶ 11, 136 P.3d 639, 647. ¶14 The plain language of § 176(J) grants public trusts the power of eminent domain for public projects involving the "transportation, delivery, treatment, or furnishing" of one or two separate utilities, i.e., either "power" or "water for domestic purposes."3 ¶15 OPWA's project involved the construction and installation of pipelines to ultimately transport and deliver wastewater from the River Valley premises and other adjoining premises to OPWA's plant for treatment. Transporting, delivering, treating, and furnishing of water for domestic purposes includes not only the furnishing of water to a household but the transportation of used water from the household to treatment plants. OPWA's project falls squarely within the plain language of § 176(J), which authorizes OPWA to exercise eminent domain over the sanitary system improvement project. ¶16 OPWA argues that it does not have the power of eminent domain over the sanitary systems improvement project performed on River Valley because the Legislature used the term water in § 176(J) and not sewer. The Legislature utilized the generic term water; it did not specify between potable water (water safe to drink or use for food preparation)4 and wastewater (used water).5 The transportation of potable water goes hand-in-hand with the transportation of wastewater or sewage. To take OPWA's position would leave public trusts empowered by the right of eminent domain to run potable water lines to residents but deny public trusts the power to run wastewater sewer lines from household after use. We reject this position. ¶17 Evidence of the Legislature's intent to allow public trusts to exercise eminent domain over both potable water and wastewater by using the term water is found in 82 O.S.2021, Ch. 14, § 1085.32(1). The Legislature identified "water" projects (through the Oklahoma Water Resources Board-- like the project at issue in this case) to include "any system necessary to improve or develop sewage treatment, collection or distribution." 82 O.S.2021, Ch. 14, § 1085.32(1), https://govt.westlaw.com/okjc (In ch. 14, follow hyperlink titled, "Water Storage and Control Facilities"). The legislative intent for the generic term water used in § 176(J) was to include both potable water furnished to households for domestic purposes and wastewater transported from a household and delivered for treatment; OPWA's sanitary system improvement project did this exact thing. ¶18 OPWA contends that the portion of the sanitary system project performed on the River Valley property did not meet the requirements in § 176(J) to exercise eminent domain because OPWA did not retain ownership over the wastewater sewer lines. This Court previously determined that an entity with the power of eminent domain owns the property placed on the land taken in a condemnation suit (or inverse condemnation suit). See Morton v. Okmulgee Producers & Mfrs. Gas Co., 1952 OK 314, ¶ 11, 248 P.2d 1028, 1029. Since we have determined that OPWA had the power of eminent domain, OPWA retained ownership of the wastewater sewer lines. II. The installation of wastewater sewer lines on the River Valley premises as part of the sanitary system project was for public use. ¶19 We next examine whether the sanitary system improvement project was for public use as required by 60 O.S.Supp.2006, § 176(J) (superseded). The question of whether a taking is for public use is a judicial question. Okla. Const. art. 2, § 24. The Oklahoma Water Resources Board awarded a grant for $99,000 to OPWA to fund the subject project. OPWA engineered and constructed the project. OPWA obtained easements for the project pertaining to the adjoining properties around River Valley. OPWA failed to obtain an easement for the portion of the project pertaining to River Valley although OPWA's engineer advised that an easement was necessary. ¶20 The project involved an improvement to the sanitary system for Okay; the project was not contained within the confines of the River Valley property. OPWA designed and constructed new wastewater sewer lines on River Valley property that included an 8" line running east and west across the southern portion of River Valley that connected and served both the adjoining subdivision to the west and the convenience store east of River Valley. The wastewater line installed to service the convenience store was connected to another line by way of a new manhole constructed on the River Valley property. OPWA's sanitary collection system (which is off-site from River Valley) receives wastewater from River Valley and other properties in Okay, and OPWA's facility treats the wastewater. The evidence presented at trial was that the sanitary system project was a public trust utility project that benefitted the public, the residents of Okay. See, e.g., Lowery, 2006 OK 31, ¶ 12 n.14, 136 P.3d at 647 n.14. ¶21 Our Court has many times considered the needs and interests of the Oklahoma public in our eminent domain cases. Reliable water systems are important to state citizens. Furnishing utilities such as power and water for citizens is so "manifestly public 'that it has seldom been questioned and never denied.'" Tuttle v. Jefferson Power & Imp. Co., 1912 OK 232, ¶ 6, 122 P. 1102, 1103 (quoting Rockingham Cty. Light & Power Co. v. Hobbs, 58 A. 46, 48 (N.H. 1904)). We hold that the installation of wastewater sewer lines on the River Valley premises as part of the sanitary system project was for public use--to improve the system that transports, delivers, treats, and furnishes water for Okay, Oklahoma. CONCLUSION ¶22 Oklahoma's statute regarding a public trust's eminent domain power grants OPWA eminent domain power over public projects involving the transportation, delivery, treatment, or furnishing of water for domestic purposes. OPWA's sanitary system improvement project involved the construction and installation of pipelines to ultimately transport and treat wastewater, and we hold the project falls squarely within OPWA's power of eminent domain. Accordingly, we vacate COCA's opinion and affirm the district court's judgment. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT AFFIRMED. CONCUR: Darby, C.J., Kane, V.C.J., Kauger, Winchester, Edmondson, Gurich, Rowe, and Kuehn, JJ. DISQUALIFIED: Combs, J. FOOTNOTES 1 The Legislature has amended 60 O.S., § 176 several times since 2003. However, the Legislature has not amended subsection J. 2 OPWA brought an indemnity claim against Third-Party Defendants L.L.G. Construction, Inc. and Western Surety Co. The district court bifurcated this claim, and it is not at issue in this appeal. 3 The Legislature defines "domestic use" as the use of water (1) by a natural individual or by a family or household for household purposes; (2) for farm and domestic animals up to the normal grazing capacity of the land; (3) for the irrigation of land not exceeding a total of three acres in area for the growing of gardens, orchards, and lawns; and, (4) for such other purposes, specified by Board rules, for which de minimis amounts are used. 82 O.S.2001, § 105.1. 4 See Potable Definition, Merriam Webster, https://www.merriam-webster.com/dictionary/potable (last visited Jan. 6, 2021). 5 See Wastewater Definition, Merriam Webster, https://www.merriam-webster.com/dictionary/wastewater (last visited Jan. 6, 2021).

c9e240dd-0a4e-47a3-81a8-025f3971f50e

Rickard v. Coulimore

oklahoma

Oklahoma Supreme Court

RICKARD v. COULIMORE2022 OK 9Case Number: 118503Decided: 01/25/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. KEELY D. RICKARD, Plaintiff/Respondent, v. JONATHAN P. COULIMORE and ELINOR COULIMORE, individually, and as Trustees under the Coulimore Family Living Trust, U/A/D March 6, 2014, Defendants/Petitioners, and JONATHAN P. COULIMORE and ELINOR COULIMORE, individually, and as Trustees under the Coulimore Family Living Trust, U/A/D March 6, 2014, Third-Party Plaintiffs, v. MONTY STRICKLAND and CAROUSEL REALTY, INC., d/b/a COLDWELL BANKER CAROUSEL REALTY, Third-Party Defendants. REVIEW OF A CERTIFIED INTERLOCUTORY ORDER OF THE DISTRICT COURT OF POTTAWATOMIE COUNTY, STATE OF OKLAHOMA HONORABLE JOHN G. CANAVAN, DISTRICT JUDGE ¶0 Defendants/Petitioners Jonathan P. Coulimore and Elinor Coulimore created the Coulimore Family Living Trust, U/A/D March 6, 2014 ("the Coulimore Trust"). The Coulimore Trust is a revocable trust, and the Coulimores are the settlors, trustees, and beneficiaries. The Coulimore Trust owned the subject real property, but the Coulimores never occupied it. The Coulimores sold the property to Plaintiff/Respondent Keely D. Rickard. Rickard later sued the Coulimores, individually and as Trustees of the Coulimore Trust, for failure to disclose defects in the property. We previously granted certiorari to review a certified interlocutory order to determine whether the real property transaction is exempt from the Residential Property Condition Disclosure Act (RPCDA), pursuant to 60 O.S.2011 § 838(A)(3). We hold the transaction is exempt from the RPCDA. The order of the district court is affirmed and the case is remanded for further proceedings. CERTIORARI PREVIOUSLY GRANTED; ORDER OF DISTRICT COURT IS AFFIRMED; REMANDED FOR FURTHER PROCEEDINGS. Kenneth R. Massey, Shawnee, Oklahoma, for Petitioners. James T. Stuart, Joseph M. Vorndran, Breanne M. Gordon, Stuart & Clover, Shawnee, Oklahoma, for Respondent. KANE, V.C.J.: ¶1 Plaintiff/Respondent Keely D. Rickard purchased the subject residential real property from the Coulimore Family Living Trust, U/A/D March 6, 2014 ("the Coulimore Trust"). Rickard later sued Defendants/Petitioners Jonathan P. Coulimore and Elinor Coulimore, individually, and as Trustees of the Coulimore Trust, for damages from defects they failed to disclose. We granted certiorari to review a certified interlocutory order to determine whether the transaction is exempt from the Residential Property Condition Disclosure Act (RPCDA), 60 O.S.2011 §§ 831-839. We hold the transaction is a transfer by a fiduciary who is not an owner occupant of the subject property in the course of the administration of a trust and, pursuant to 60 O.S.2011 § 838(A)(3), the transaction is exempt from the RPCDA. We affirm partial summary judgment as to the inapplicability of the RPCDA and remand for further proceedings. I. FACTS AND PROCEDURAL HISTORY ¶2 The undisputed material facts are that the subject residential real property located in Pottawatomie County, Oklahoma, was conveyed to the Coulimores, as husband and wife, in June 2007. The Coulimores created the Coulimore Trust and transferred the subject property to the Coulimore Trust in March 2014. The Coulimore Trust is a revocable trust, and the Coulimores are the settlors, trustees, and beneficiaries of the Coulimore Trust. The Coulimores have never resided in or on the property. Rather, at all relevant times, they lived in the state of Washington and their daughter, son-in-law, and grandchildren lived on the property. In October 2015, Rickard purchased the property from the Coulimore Trust. ¶3 Rickard filed the underlying action against the Coulimores on January 29, 2016, alleging they failed to disclose certain defects in the property. Rickard alleges that she was forced to vacate the property due to issues from previous flooding, water, and drainage damage. The parties filed competing motions for summary judgment. The Coulimores argued they were entitled to judgment as a matter of law because there was no duty to disclose the alleged defects under the RPCDA and because Rickard waived her right to inspect the property and any claims at closing. Rickard argued the transaction was exempt from the RPCDA and, therefore, she could pursue common law remedies. The trial court found the transaction was exempt from the RPCDA, pursuant to 60 O.S. § 838(A)(3), and granted Rickard's motion for partial summary judgment as it related to the inapplicability of the RPCDA. The district court certified the order for immediate appeal. The Coulimores filed a petition for certiorari to review the certified interlocutory order, which this Court previously granted. Whether the RPCDA applies is the single issue on appeal. II. STANDARD OF REVIEW ¶4 Summary judgment is reviewed de novo. See Miller v. David Grace, Inc., 2009 OK 49, ¶ 10, 212 P.3d 1223, 1227. Summary judgment is appropriate only when there is no genuine controversy as to any material fact, and the moving party is entitled to judgment as a matter of law. Id. In this case, the material facts are not in dispute. This appeal requires us to construe 60 O.S.2011 § 838(A)(3). Issues of statutory construction present questions of law, which we review de novo. See Fanning v. Brown, 2004 OK 7, ¶ 8, 85 P.3d 841, 845. Appellate courts have plenary, independent and nondeferential authority to determine whether the trial court erred in its legal rulings. Id. ¶5 The fundamental purpose of statutory construction is to ascertain and give effect to the intent of the Legislature. See City of Durant v. Cicio, 2002 OK 52, ¶ 13, 50 P.3d 218, 221. To do this, we first look to the language of the statute. Id. If the statutory language is clear and unambiguous, this Court must apply the plain and ordinary meaning of the words. Id.; 25 O.S.2011 § 1. Only when the legislative intent cannot be determined from the statutory language due to ambiguity or conflict should rules of statutory construction be employed. See Keating v. Edmondson, 2001 OK 110, ¶ 8, 37 P.3d 882, 886. III. ANALYSIS ¶6 The RPCDA provides the sole and exclusive remedy for civil actions for a seller's failure to disclose to the buyer a defect which was actually known to the seller prior to acceptance of an offer to purchase. See 60 O.S.2011 § 837(A)-(B); White v. Lim, 2009 OK 79, ¶ 17, 224 P.3d 679, 685. The RPCDA applies to most residential real property transactions. See 60 O.S.2011 §§ 832-833. However, § 838 lists several exemptions. The trial court found the transaction was exempt from the RPCDA pursuant to 60 O.S. § 838(A)(3), which provides: A. This act does not apply to: . . . 3. Transfers by a fiduciary who is not an owner occupant of the subject property in the course of the administration of a decedent's estate, guardianship, conservatorship or trust . . . . 60 O.S. § 838(A). Rickard's position is the transaction is exempt and the RPCDA does not apply. The Coulimores' position is the transaction is not exempt and the RPCDA does apply. The Coulimores argue the transaction is not exempt because (1) the transaction was not a transfer by a fiduciary; (2) the Coulimores, as husband and wife, previously owned the property and, therefore, were "owner occupants" of the subject property; and (3) the transfer was not in the course of the administration of a decedent's trust. A. TRANSFERS BY A FIDUCIARY ¶7 The Coulimores argue there is no transfer by a fiduciary when the trustees and beneficiaries are the same people. The Coulimores assert that a fiduciary owes a duty to another and, because they were the settlors, trustees, and beneficiaries of the revocable trust, there was no transfer "by a fiduciary," as required by 60 O.S. § 838(A)(3). The Coulimores point to definitions of "fiduciary" to support their position.1 ¶8 This requires us to construe "fiduciary" as it is used in 60 O.S. § 838(A)(3). We find the Coulimores' argument to be unpersuasive. It is well understood that a trustee is a fiduciary. Similarly, executors, administrators, guardians, and conservators are all fiduciaries. The plain and ordinary meaning of "transfer by a fiduciary," as used in 60 O.S. § 838(A)(3), includes a transfer by a trustee who is not an owner occupant of the subject property in the course of the administration of a trust.2 There is no indication in the statutory language that the Legislature intended for the exemption to apply when the trustee and the beneficiary are different but not when the trustee and beneficiary are the same. We hold the exemption may apply when the trustee and the beneficiary are the same person.3 ¶9 We further reject the Coulimores' argument that the exemption does not apply because it is not until the death of the settlor that a revocable trust becomes irrevocable and a fiduciary relationship is created between the successor trustee and the remaining beneficiaries. The statutory language is "trust." The Legislature did not distinguish between revocable and irrevocable trusts in 60 O.S. § 838(A)(3). Without such specificity, we understand this to mean all trusts.4 We presume the Legislature expressed its intent and intended what it expressed--and nothing more. See Thurston v. State Farm Mut. Auto. Ins. Co., 2020 OK 105, ¶ 16, 478 P.3d 415, 420; McCarter v. State ex rel. Pitman, 1921 OK 149, ¶¶ 2-3, 198 P. 303, 305. ¶10 It is undisputed the Coulimores were acting as trustees of the Coulimore Trust when they sold the property to Rickard. The transaction was a transfer by a fiduciary within the meaning of 60 O.S. § 838(A)(3). B. WHO IS NOT AN OWNER OCCUPANT OF THE SUBJECT PROPERTY ¶11 The Coulimores argue they previously owned the subject property in their individual capacities and, therefore, the exemption cannot apply. The pertinent language is: "This act does not apply to . . . transfers by a fiduciary who is not an owner occupant of the subject property . . ." 60 O.S. § 838(A)(3) (emphasis added). It is undisputed the Coulimores have never been occupants of the subject property. However, the Coulimores reason that, because they were in the chain of title, they were "owners" and their prior ownership alone prevents the exemption from applying. ¶12 We are not persuaded by this argument. The Coulimores' suggested reading of the statute completely ignores the word "occupant." A statute must be read to render every part operative and to avoid rendering parts superfluous or useless. See Moran v. City of Del City, 2003 OK 57, ¶ 8, 77 P.3d 588, 591. We will not presume that the Legislature has done a vain or useless act. See Matter of Estate of Fulks, 2020 OK 94, ¶ 21, 477 P.3d 1143, 1151. Rather, we must interpret legislation so as to give effect to every word and sentence. See Hill v. Bd. of Educ., 1997 OK 111, ¶ 12, 944 P.2d 930, 933. The plain and ordinary meaning of "owner occupant," as used in 60 O.S. § 838(A)(3) is an owner who occupies the subject property. "Owner occupant" does not mean either an owner or an occupant of the subject property. The owner and seller in this case is a trust.5 A trust cannot occupy property. But if the trustee of the trust is a natural person, the trustee may occupy the property. ¶13 In White v. Lim, 2009 OK 79, 224 P.3d 679, this Court held that the RPCDA expressly prohibited exemplary damages. Id. ¶ 17, at 685. The buyers in White made the same argument Rickard is making: their claims are exempt pursuant to 60 O.S. § 838(A)(3). However, in White, this Court noted that whether the buyers' claims were exempt from the RPCDA because the sellers acted as fiduciaries in making the transfer was not an issue certified for interlocutory review. Id. n. 3, 224 P.3d at 681. The Court found the issue was not properly before it, but then went on to point out that the buyers had failed to assert that the trustees were not owner occupants of property within the meaning of § 838(A)(3). Id. The Court called attention to conflicting assertions made in the trustees' pleadings as to whether they occupied the home prior to the sale. Id. The footnote suggests the transaction would have been exempt had it been undisputed or otherwise determined that the trustees were not occupants of the subject property. While White does not squarely answer the question presented today, we can glean from the footnote that the Court understood the pertinent language to mean a trustee who is not an occupant of the subject property. Today, we make that clear. We hold that if a trust owns the subject property and the trustee is not an occupant of the subject property, the "not an owner occupant of the subject property" element of the exemption is satisfied.6 ¶14 The Coulimore Trust owned the subject property. The Coulimores are natural persons and the trustees of the Coulimore Trust. It is undisputed that the Coulimores never occupied the subject property. Therefore, the Coulimores were fiduciaries who were not owner occupants of the subject property within the meaning of 60 O.S. § 838(A)(3). C. IN THE COURSE OF THE ADMINISTRATION OF A DECEDENT'S ESTATE, GUARDIANSHIP, CONSERVATORSHIP OR TRUST ¶15 The Coulimores next argue that because they were living at the time of the transaction, the exemption does not apply. The statute provides: This act does not apply to: . . . Transfers by a fiduciary who is not an owner occupant of the subject property in the course of the administration of a decedent's estate, guardianship, conservatorship or trust . . . . 60 O.S. § 838(A). The Coulimores argue "decedent's" modifies each noun that follows: decedent's estate, decedent's guardianship, decedent's conservatorship, decedent's trust. The Coulimores insist there must be a decedent to trigger the exemption, and they are still living. Furthermore, the Coulimores argue "administration of a trust" implies the death of the settlor. ¶16 We are not persuaded by the Coulimores' arguments. The plain and ordinary meaning of the words and sentence structure is that "decedent's" attaches to "estate" only. A decedent is not always necessary to administer a trust. Many trusts are administered in whole or in part during the lifetime of the settlors. Similarly, guardianships and conservatorships originate with a living ward. IV. CONCLUSION ¶17 The subject property was owned by the Coulimore Trust. The Coulimores were acting as trustees of the Coulimore Trust when they sold the subject property to Rickard. The Coulimores have never occupied the property. Therefore, the transaction was a transfer by a fiduciary who is not an owner occupant of the subject property in the course of the administration of a trust and, pursuant to 60 O.S. § 838(A)(3), is exempt from the RPCDA. CERTIORARI PREVIOUSLY GRANTED; ORDER OF DISTRICT COURT IS AFFIRMED; REMANDED FOR FURTHER PROCEEDINGS. CONCUR: Darby, C.J., Kane, V.C.J., Winchester, Edmondson, Gurich, Rowe, and Kuehn, JJ. DISSENT: Kauger, J. NOT PARTICIPATING: Combs, J. FOOTNOTES 1 Black's Law Dictionary defines "fiduciary" as: 1. Someone who is required to act for the benefit of another person on all matters within the scope of their relationship; one who owes to another the duties of good faith, loyalty, due care, and disclosure . 2. Someone who must exercise a high standard of care in managing another's money or property . Black's Law Dictionary (11th ed. 2019). Rickard primarily relies on Mamoodjanloo v. Wolf, 2008 OK CIV APP 59, 190 P.3d 1170, to support her argument the transaction is exempt from the RPCDA. In Mamoodjanloo, the trustees of a revocable trust sold real property owned by the trust. See id. ¶ 4, at 1171. The Court of Civil Appeals determined the property transfer was exempt under 60 O.S. § 838(A)(3). Id. ¶¶ 11-12, at 1172-73. However, whether the trustees were fiduciaries within the meaning of the statute was not disputed. The issue presented in this case was neither raised nor analyzed in Mamoodjanloo. 2 In Hawkins v. Voss, 29 N.E.3d 1233 (Ill. App. Ct. 2015), a case that was not cited by either party, the Appellate Court of Illinois was presented with this question of law and reached the same conclusion. The Illinois court reasoned: [Seller's] attempt to separate the terms "fiduciary" and "trustee" fails, as a fiduciary in the course of the administration of a trust and a trustee in the course of the administration of a trust are directly related. . . . Illinois law has consistently held that trustees assume the role of a fiduciary. The fact that the trustee and beneficiary are the same person in the instant case does not erase the fiduciary role [seller] assumes in acting as trustee in the course of administering the trust. Accordingly, [seller's] argument that she was acting as a trustee but not a fiduciary is incorrect, as she was acting in both the role as trustee and fiduciary. Id. at 1238-39. 3 This holding protects the sanctity of the revocable trust, which is a commonly used estate planning tool. A holding that the trustee and beneficiary must be different would give buyers and real estate agents reason to delve into the terms of sellers' trust instruments for the purpose of identifying beneficiaries to determine if the transaction is exempt from the RPCDA. 4 If the Legislature intended something else, it may clarify its intent with a statutory amendment. For example, California's comparable, but more specific, exemption provides: This article does not apply to the following: . . . (d) Sales or transfers by a fiduciary in the course of the administration of a trust, guardianship, conservatorship, or decedent's estate. This exemption shall not apply to a sale if the trustee is a natural person who is a trustee of a revocable trust and is a former owner of the property or was an occupant in possession of the property within the preceding year. Cal. Civ. Code § 1102.2 (Westlaw, current with all laws through Ch. 770 of 2021 Reg. Sess.). 5 As defined by the RPCDA, "'[s]eller' means one or more persons who are attempting to transfer a possessory interest in property . . . ." 60 O.S.2011 § 832(2). "'Person' means an individual, corporation, limited liability company, partnership, association, trust or other legal entity or any combination thereof . . . ." Id. § 832(6). 6 Again, if the Legislature intended something else, they have the opportunity to provide clarification. See supra note 4.

0a44d5eb-1813-4a5b-b224-da1b06287d57

Owens, et al. v. Zumwalt

oklahoma

Oklahoma Supreme Court

OWENS v. ZUMWALT2022 OK 14Case Number: 119786Decided: 02/08/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. RONDA K. OWENS, DARRYL HUBBARD, SELENA FREYMILLER, SHANIKA CROWLEY, VALERIE KILLMAN, MICHAEL LEE PITTS, EBONY WARRIOR, JOHN BALL, MICHELLE BULLOCK, LOGAN BELLEW, SONDIA BELL, TUMEEKA BAKER, and JAY REID, Plaintiffs/Appellees, v. SHELLEY ZUMWALT, in her official capacity as Executive Director of the Oklahoma Employment Security Commission, Defendant/Appellant. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY, STATE OF OKLAHOMA HONORABLE ANTHONY L. BONNER, JR., DISTRICT JUDGE ¶0 Plaintiffs/Appellees Ronda K. Owens, Darryl Hubbard, Selena Freymiller, Shanika Crowley, Valerie Killman, Michael Lee Pitts, Ebony Warrior, John Ball, Michelle Bullock, Logan Bellew, Sondia Bell, Tumeeka Baker, and Jay Reid (collectively "Citizens") filed the underlying lawsuit seeking declaratory and injunctive relief. Citizens claim that Governor J. Kevin Stitt and Defendant/Appellant Shelley Zumwalt, in her official capacity as Executive Director of the Oklahoma Employment Security Commission, acted without authority and violated 40 O.S.2011 § 4-313 of the Oklahoma Employment Security Act by terminating agreements with the U.S. Department of Labor to administer COVID-related unemployment programs. The trial court entered a preliminary injunction ordering Zumwalt to immediately reinstate and administer the programs. Zumwalt appealed, and this Court stayed the trial court's order pending appeal. We hold 40 O.S. § 4-313 does not create a private right of action and, therefore, the trial court abused its discretion by granting a preliminary injunction. STAY LIFTED; PRELIMINARY INJUNCTION VACATED; CAUSE REMANDED WITH INSTRUCTIONS TO DISMISS WITH PREJUDICE. Chadwick Smith, Palm Desert, California, and Brendan M. McHugh and Dana Jim, Claremore, Oklahoma, for Appellees. Mithun Mansinghani, Zach West, and Andy N. Ferguson, Office of Attorney General, State of Oklahoma, for Appellant. KANE, V.C.J.: ¶1 This is an interlocutory appeal from a preliminary injunction ordering Defendant/Appellant Shelley Zumwalt, in her official capacity as Executive Director of the Oklahoma Employment Security Commission, to immediately reinstate and administer federal COVID-related unemployment programs. We hold 40 O.S.2011 § 4-313 does not create a private right of action and, therefore, the trial court abused its discretion by granting a preliminary injunction. FACTS AND PROCEDURAL HISTORY ¶2 On March 15, 2020, Governor J. Kevin Stitt signed Executive Order No. 2020-07, declaring the COVID-19 pandemic to be a statewide emergency under the provisions of the Oklahoma Emergency Management Act, 63 O.S.Supp.2013 §§ 683.1-683.24. Congress passed the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) on March 27, 2020. The CARES Act made available to the states several new unemployment benefit programs. These programs included: Pandemic Unemployment Assistance (PUA), 15 U.S.C.A. § 9021, which provided benefits to persons who were not eligible for regular unemployment and whose unemployment or inability to work was caused by COVID-19. Pandemic Emergency Unemployment Compensation (PEUC), 15 U.S.C.A. § 9025, which added additional weeks of benefits for persons who had exhausted regular unemployment benefits. Federal Pandemic Unemployment Compensation (FPUC), 15 U.S.C.A. § 9023, which provided additional unemployment benefits in the amount of $600 per week from March 27, 2020 through July 31, 2020 and $300 per week through September 6, 2021. Soon after passage of the CARES Act, the Executive Director of the Oklahoma Employment Security Commission (OESC) signed agreements with the U.S. Department of Labor (DOL) to administer the new COVID-related unemployment programs. Governor Stitt delegated authority for the execution of the agreements to the Executive Director of OESC. The Continued Assistance to Unemployed Workers Act added the Mixed Earner Unemployment Compensation (MEUC) program, 15 U.S.C. § 9023(b)(1)(C). Governor Stitt also signed a delegation of authority for the execution of an agreement with the DOL to administer the MEUC program to the Executive Director of OESC. ¶3 Thereafter, on May 3, 2021, the Governor withdrew the COVID-19 emergency declaration. See Executive Order No. 2021-11. The COVID-related unemployment programs were set to expire on September 6, 2021. However, on May 14, 2021, Governor Stitt signed another delegation of authority to OESC Executive Director Shelley Zumwalt for purposes of terminating Oklahoma's agreements with the DOL to administer the COVID-related unemployment programs. On May 17, 2021, Governor Stitt signed Executive Order No. 2021-15, which indicated, as of June 27, 2021, Oklahoma would no longer provide COVID-related unemployment benefits and, instead, would provide a one-time $1,200 incentive to assist those returning to the workforce. The same day, Zumwalt provided written notice to the DOL that OESC was terminating the agreements. On June 19, 2021, OESC mailed written notices that the COVID-related unemployment benefits would end on June 26, 2021, and they did. ¶4 Plaintiff/Appellee Ronda K. Owens filed a Petition for Declaratory Judgment and Injunctive Relief against Zumwalt on July 7, 2021. The Petition was amended on July 20, 2021 to add Plaintiff/Appellee Darryl Hubbard and additional Plaintiffs/Appellees who lost benefits when the COVID-related unemployment programs ended (collectively, "Citizens"). Citizens alleged that Governor Stitt and Zumwalt acted without authority and violated 40 O.S. § 4-313 of the Oklahoma Employment Security Act (OESA) by terminating the agreements with the DOL to administer COVID-related unemployment programs. Citizens sought a preliminary injunction requiring Zumwalt to administer the COVID-related unemployment programs. The trial court heard the matter on August 5, 2021. The trial court granted the preliminary injunction in an email on August 6, 2021 and ordered Zumwalt to immediately notify the DOL that Oklahoma would be reinstating the COVID-related unemployment programs. On August 9, 2021, the trial court entered an order granting the preliminary injunction and further enjoined Zumwalt from withdrawing Oklahoma from the COVID-related unemployment programs until the court rendered a final judgment on the merits or until the programs expired on September 6, 2021, whichever occurred first. The trial court did not stay the order. Zumwalt appealed. ¶5 On August 17, 2021, this Court granted Zumwalt's emergency motion to stay the trial court's order and retained the appeal. As a result, the COVID-related unemployment programs were not reinstated during the pendency of the appeal.1 Briefing concluded on November 17, 2021, and the record on appeal was transmitted to the Supreme Court on December 10, 2021. STANDARD OF REVIEW ¶6 This Court reviews the granting of a preliminary injunction for an abuse of discretion. Brown v. Okla. Secondary Sch. Activities Ass'n, 2005 OK 88, ¶ 11, 125 P.3d 1219, 1225. An abuse of discretion occurs when a decision is clearly against the weight of the evidence, contrary to law, or contrary to established principles of equity. See Sharp v. 251st St. Landfill, Inc., 1996 OK 109, ¶ 4, 925 P.2d 546, 549. Whether a statute creates a private right of action presents a question of law, which the appellate court reviews de novo. ANALYSIS ¶7 Oklahoma's participation in the COVID-related unemployment programs ended ten days before Citizens filed this lawsuit seeking declaratory and injunctive relief. A preliminary injunction preserves the status quo until there can be a final determination of the controversy. See State ex rel. State Highway Comm'n v. Gillam, 1940 OK 390, ¶ 11, 105 P.2d 773, 775. "[T]he status quo which will be preserved by preliminary injunction is the last actual, peaceable, noncontested status which preceded the pending controversy . . . ." Dusbabek v. Local Bldg. & Loan Ass'n, 1936 OK 769, ¶ 8, 63 P.2d 756, 759. When the petition was filed in this case, the status quo was that COVID-related unemployment programs were not being administered in Oklahoma. Plaintiffs were not seeking the typical preventative or prohibitive preliminary injunction to preserve the status quo. Rather, Plaintiffs sought to change the status quo. A mandatory injunction is an extraordinary remedial process that commands the performance of some positive act. See Peck v. State ex rel. Dep't of Highways, 1960 OK 89, ¶ 7, 350 P.2d 948, 950. The trial court entered a mandatory preliminary injunction requiring Zumwalt to immediately reinstate and administer the programs. ¶8 To obtain a preliminary injunction, the plaintiffs must show that four factors weigh in their favor: (1) the likelihood of success on the merits; (2) irreparable harm to the parties seeking injunctive relief if the injunction is denied; (3) their threatened injuries outweigh the injury the opposing party will suffer under the injunction; and (4) the injunction is in the public interest. See Dowell v. Pletcher, 2013 OK 50, ¶ 7, 304 P.3d 457, 460 (as corrected July 15, 2013). Mandatory injunctions are generally governed by the same rules applicable to preventative or prohibitive injunctions. See Thompson v. North, 1942 OK 346, ¶ 6, 129 P.2d 1011, 1013. However, the rules are more strictly construed when applied to mandatory injunctions. The party seeking a mandatory injunction must show violation of a clear legal right and a case of necessity and great hardship. Id. Even if the right is clear, a mandatory injunction will be issued only in a "case of extreme necessity, where the right invaded is material and substantial, and where other adequate redress is not afforded." Peck, 1960 OK 89, ¶ 7, 350 P.2d at 950. This Court has said that ordinarily a mandatory preliminary injunction should not be granted because the purpose of a preliminary injunction is to preserve the situation of the parties in status quo until a final determination of the controversy. See Gillam, 1940 OK 390, ¶ 11, 105 P.2d at 775. "However, this rule is not without its exceptions and limitations and it is proper to grant relief of a mandatory character in a temporary injunction when the need is urgent and the right is clear." Id. ¶9 Zumwalt argues that Citizens have not established a likelihood of succeeding on the merits, because 40 O.S. § 4-313 does not create a private right of action.2 We agree. Without a cause of action, Citizens cannot state a claim upon which relief can be granted. As a result, they cannot succeed on the merits or show violation of a clear legal right. ¶10 Citizens seek a declaratory judgment that Zumwalt's early withdrawal from the COVID-related unemployment programs violated 40 O.S. § 4-313, which provides: In the administration of this act the Oklahoma Employment Security Commission shall cooperate to the fullest extent consistent with the provisions of this act, with the Social Security Act, as amended, and is authorized and directed to take such action, through the adoption of appropriate rules, administrative methods and standards, as may be necessary to secure to this state and its citizens all advantages available under the provisions of such act, under the provisions of Sections 1602 and 1603 of the Federal Unemployment Tax Act and under the provisions of the Act of Congress entitled "An Act to provide for the establishment of a national employment system and for cooperation with States in the promotion of such system, and for other purposes", approved June 6, 1933, as amended. The Commission shall comply with the regulations of the Secretary of Labor relating to the receipt or expenditure by this state of monies granted under any of such acts and shall make such reports, in such form and containing such information as the Secretary of Labor may from time to time require, and shall comply with such provisions as the Secretary of Labor may from time to time find necessary to assure the correctness and verification of such reports. The Commission may afford reasonable cooperation with every agency of the United States charged with the administration of any unemployment insurance law. 40 O.S.2011 § 4-313. This is a regulatory statute. The Supreme Court has adopted a three-pronged test to determine if a private cause of action can be inferred from a regulatory or public-law statute: (1) the plaintiff is one of the class for whose especial benefit the statute was enacted; (2) some indication of legislative intent, explicit or implicit, suggests that the Legislature wanted to create a private remedy and not to deny one; and (3) implying a remedy for the plaintiff would be consistent with the underlying purposes of the legislative scheme. See Holbert v. Echeverria, 1987 OK 99, ¶¶ 7-8, 744 P.2d 960, 963. ¶11 Nothing in 40 O.S. § 4-313 indicates the Legislature intended, either explicitly or implicitly, to create a private remedy to enforce the OESA. The Legislature does, however, provide an administrative remedy to enforce one's right to benefits under the OESA, including a process for challenging the denial of unemployment benefits. See 40 O.S.Supp.2019 §§ 2-601 to 2-619 (since amended by Laws 2021, c. 424, § 8, eff. Nov. 1, 2021). ¶12 Citizens argue that this administrative remedy and judicial review process provides a private right of action.3 Citizens rely on Plaintiff Darryl Hubbard's attempted administrative appeal of the OESC's denial of COVID-related unemployment benefits. Plaintiff Hubbard received a letter from the OESC with a mailed date of June 19, 2021. The letter notified him that the COVID-related unemployment benefits would end on June 26, 2021, and that he could appeal the OESC's determination within ten (10) days. Plaintiff Hubbard appealed, and on July 2, 2021, the OESC Appeals Tribunal responded: "You are not able to appeal the Governor's mandate to end the Federal benefits early. If you disagree with that decision you will need to contact the Governor's office directly." Citizens assert that because the Appeals Tribunal denied Plaintiff Hubbard's appeal, he brought this action. Citizens contend there is no need to exhaust administrative remedies when such effort would be useless. ¶13 We are not persuaded by Citizens' argument. Implying a private right of action would undermine the administrative scheme. Plaintiff Hubbard's administrative appeal and the underlying lawsuit are completely separate proceedings. The petition filed in this case was not one seeking judicial review of the Board of Review's decision denying COVID-related unemployment benefits. See 40 O.S.2011 § 2-610 (since amended by Laws 2021, c. 424, § 8, eff. Nov. 1, 2021). Plaintiff Hubbard abandoned his administrative appeal and, on July 20, 2021, opted to join this lawsuit seeking a declaratory judgment and injunctive relief in district court.4 ¶14 Finally, Citizens' reliance on Hunsucker v. Fallin, 2017 OK 100, 408 P.3d 599 (as modified Dec. 20, 2017), is misplaced. Hunsucker does not support a private right of action under 40 O.S. § 4-313. Hunsucker is about standing. Without a cause of action, there is no issue of standing. ¶15 Because we find Citizens do not have a private right of action, we need not address the merits of whether Governor Stitt and Zumwalt acted without authority or violated 40 O.S. § 4-313 of the OESA by terminating the agreements with the U.S. Department of Labor to administer COVID-related unemployment programs. CONCLUSION ¶16 We hold there is no private right of action for Citizens to enforce 40 O.S. § 4-313 of the Oklahoma Employment Security Act. Therefore, the trial court abused its discretion by entering a mandatory preliminary injunction requiring Zumwalt to reinstate and administer the COVID-related unemployment programs. STAY LIFTED; PRELIMINARY INJUNCTION VACATED; CAUSE REMANDED WITH INSTRUCTIONS TO DISMISS WITH PREJUDICE. CONCUR: Darby, C.J., Kane, V.C.J., Winchester, Gurich, Rowe, and Kuehn, JJ. CONCUR IN RESULT: Kauger, Edmondson, and Combs (by separate writing), JJ. FOOTNOTES 1 Citizens' motion to set aside the stay and dismiss the appeal was denied by this Court on September 13, 2021. 2 The trial court's order granting the preliminary injunction did not address this argument made by Zumwalt. 3 In their Amended Petition, Citizens state they are bringing this declaratory judgment action pursuant to 75 O.S. § 306. Section 306 of the Oklahoma Administrative Procedures Act applies to the validity or applicability of a rule. See 75 O.S.2011 § 306. On appeal, Citizens do not argue that 75 O.S. § 306 supports a private right of action to enforce 40 O.S.2011 § 4-313. 4 After receiving the letter from the Appeals Tribunal, Plaintiff Hubbard did not pursue the administrative appeal or otherwise seek to require the Appeals Tribunal to fulfill its duty. Combs, J., with whom Kauger, J., joins, concurring in result: ¶1 I concur in the result of the majority opinion finding that the trial court abused its discretion by entering a mandatory preliminary injunction. It is my opinion that the Plaintiffs/Appellees' Petition for Declaratory Judgment and Injunctive Relief filed on July 7, 2021, was moot because the uncontroverted evidence reveals the benefits in question ended on June 26, 2021. The status quo at the time the petition was filed was that the unemployment programs at issue here were not being administered in Oklahoma. I would therefore concur in the result of the majority opinion.

1091fed0-95de-4ec9-b70c-92e077c19c59

Magnum Energy v. Bd. of Adjustment for the City of Norman

oklahoma

Oklahoma Supreme Court

MAGNUM ENERGY v. BD. OF ADJUSTMENT FOR THE CITY OF NORMAN2022 OK 26Case Number: 117912Decided: 03/22/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MAGNUM ENERGY, INC., Plaintiff/Appellee, v. BOARD OF ADJUSTMENT FOR THE CITY OF NORMAN, OKLAHOMA, Defendant/Appellant. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I Honorable Jeff Virgin, Trial Judge ¶0 Plaintiff, Magnum Energy, Inc., appealed a decision from Defendant, Board of Adjustment for the City of Norman, Oklahoma, denying Plaintiff's application for a variance from the City's business licensing requirement that oil and gas operators maintain two million dollars in umbrella liability coverage. The trial court granted summary judgment in Plaintiff's favor, finding that the requirement conflicts with State law and is therefore unenforceable. Defendant appealed the trial court's order, and the matter was assigned to the Court of Civil Appeals, Division I. The Court of Civil Appeals reversed the trial court's order, finding no conflict between the requirement and State law. We granted certiorari to address whether the requirement conflicts with 52 O.S.Supp.2015 § 137.1, which establishes the authority of localities to regulate oil and gas operations. We hold that the requirement conflicts with 52 O.S.Supp.2015 § 137.1, rendering the requirement invalid and unenforceable. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF THE TRIAL COURT AFFIRMED. Gregory L. Mahaffey and Zachary J. Foster, Mahaffey & Gore, P.C., Oklahoma City, Oklahoma, for Plaintiff/Appellee. Rickey J. Knighton II and Elisabethe E. Muckala, Norman, Oklahoma, for Defendant/Appellant. ROWE, J.: I. BACKGROUND ¶1 Section 13-1502.1(a)(4) of the Norman Municipal Code requires oil and gas operators to maintain an umbrella insurance policy with at least two million dollars in coverage. Plaintiff, Magnum Energy Inc. ("Magnum"), has operated the Patty No. 1 Well in Norman, Oklahoma, since September 1989. On January 2, 2018, Magnum filed an application for a variance with Defendant, Board of Adjustment for the City of Norman ("Board"), requesting a waiver of the umbrella insurance requirement contained in § 13-1502.1(a)(4). On January 24, 2018, Board denied Magnum's application for a variance. ¶2 Magnum appealed Board's order to the District Court of Cleveland County on February 2, 2018. In its appeal, Magnum claimed, among other things, that § 13-1502.1(a)(4) conflicted with 52 O.S.Supp.2015 § 137.1, which places limits on the authority of localities to regulate oil and gas operations. On January 10, 2019, Magnum filed a Motion for Summary Judgment seeking to have § 13-1502.1(a)(4) declared void and unenforceable on grounds that it conflicted with state law. On March 19, 2019, the District Court granted Magnum's Motion for Summary Judgment, finding that § 13-1502.1(a)(4) conflicts with 52 O.S.Supp.2015 § 137.1 and enjoining its enforcement against Magnum. ¶3 Board filed its Petition in Error on April 18, 2019. The matter was assigned to the Court of Civil Appeals, Division I ("COCA"). On June 24, 2020, COCA issued an unpublished opinion reversing the District Court's order granting Magnum's Motion for Summary Judgment. COCA determined that § 13-1502.1(a)(4) of the Norman Municipal Code was enacted pursuant to the City's general police power, the ordinance is not precluded by 52 O.S.Supp.2015 § 137.1 and is enforceable. ¶4 On June 24, 2020, Magnum filed its Petition for Certiorari, alleging that COCA decided a question of substance not yet determined by this Court and did so in a manner not in accord with prior applicable decisions of this Court. On December 14, 2020, we granted certiorari. Magnum contends on appeal that the enactment of § 137.1 in 2015 curtailed the authority of localities to regulate oil and gas operations under the scope of their general police power and that § 13-1502.1(a)(4) is precluded by § 137.1. II. STANDARD OF REVIEW ¶5 We review a trial court's order granting summary judgment de novo. Tiger v. Verdigris Valley Elec. Coop., 2016 OK 74, ¶ 13, 410 P.3d 1007, 1011. Likewise, legal questions involving statutory interpretation are subject to de novo review. Cole v. Josey, 2019 OK 39, ¶ 3, 457 P.3d 1007, 1009. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. III. DISCUSSION ¶6 Magnum's position on certiorari is that the umbrella insurance requirement in § 13-1502.1(a)(4) of the Norman Municipal Code conflicts with 52 O.S.Supp.2015 § 137.1. "The general rule is that a municipal ordinance or portion thereof which is in conflict with state statutes is void." Constant v. Brown, 1941 OK 205, ¶ 8, 114 P.2d 477, 478. "A conflict exists between a state enactment and a municipal charter or ordinance when both contain either express or implied provisions that are inconsistent or irreconcilable with one another." State ex rel. Trimble v. City of Moore, 1991 OK 97, ¶ 29, 818 P.2d 889, 898. A municipal ordinance may, however, supersede a state statute if the ordinance affects a subject that is purely of municipal concern. Vinson v. Medley, 1987 OK 41, ¶ 5, 737 P.2d 932, 936. It does not appear to be Board's position that the subject matter of § 13-1502.1(a)(4) is purely of municipal concern. ¶7 Whether the umbrella insurance requirement of § 13-1502.1(a)(4) exceeds the scope of the authority reserved for municipalities to regulate oil and gas production under § 137.1 presents two questions: (1) what is the scope of municipal authority to regulate the production of oil and gas, and (2) whether § 13-1502.1(a)(4) falls within the scope of that authority. ¶8 Both of these questions necessarily involve statutory interpretation. When interpreting a statute, we keep the following principles in mind: The goal of any inquiry into the meaning of a statutory enactment is to ascertain and give effect to the intent of the legislature. The law-making body is presumed to have expressed its intent in a statute's language and to have intended what the text expresses. If a statute is plain and unambiguous, it will not be subjected to judicial construction, but will receive the effect its language dictates. Only where the intent cannot be ascertained from a statute's text, as when ambiguity or conflict (with other statutes) is shown to exist, may rules of statutory construction be employed. Yocum v. Greenbriar Nursing Home, 2005 OK 27, ¶ 9, 130 P.3d 213, 219 (internal citations omitted). ¶9 As to the first issue, Magnum contends that a municipality's authority to regulate oil and gas production is confined to the parameters set out in § 137.1.1 Section 137.1 grants municipalities authority to regulate oil and gas production in three areas, to wit: A municipality, county or other political subdivision may enact reasonable ordinances, rules and regulations concerning road use, traffic, noise and odors incidental to oil and gas operations within its boundaries, provided such ordinances, rules and regulations are not inconsistent with any regulation established by Title 52 of the Oklahoma Statutes or the Corporation Commission. 52 O.S.Supp.2015 § 137.1. Second, a municipality has the ability to: [E]stablish reasonable setbacks and fencing requirements for oil and gas well site locations as are reasonably necessary to protect the health, safety and welfare of its citizens but may not effectively prohibit or ban any oil and gas operations, including oil and gas exploration, drilling, fracture stimulation, completion, production, maintenance, plugging and abandonment, produced water disposal, secondary recovery operations, flow and gathering lines or pipeline infrastructure. Id. Finally, a municipality may: [E]nact reasonable ordinances, rules and regulations concerning development of areas within its boundaries which have been or may be delineated as a one-hundred-year floodplain but only to the minimum extent necessary to maintain National Flood Insurance Program eligibility. Id. Except for these three areas, § 137.1 states, "All other regulations of oil and gas operations shall be subject to the exclusive jurisdiction of the Corporation Commission." ¶10 In addition to the express language of § 137.1, Magnum points to the changes between § 137.1 and its predecessor, § 137, as further evidence of the Legislature's intent to limit the scope of municipal authority to regulate oil and gas. Prior to the adoption of § 137.1 in 2015, municipal authority to regulate oil and gas was governed, at least in part, by 52 O.S.2011 § 137, which stated: Nothing in this act is intended to limit or restrict the rights of cities and towns governmental corporate powers to prevent oil or gas drilling therein nor under its police powers to provide its own rules and regulations with reference to well-spacing units or drilling or production which they may have at this time under the general laws of the State of Oklahoma. Magnum acknowledges that under the former statutory scheme, municipal authority to regulate oil and gas was much more expansive and likely would have encompassed regulations like the umbrella insurance requirement in § 13-1502.1(a)(4). At the same time, Magnum contends that the stark changes between § 137 and § 137.1 evince a clear intent on behalf of the Legislature to shift primary exclusive jurisdiction over the regulation of oil and gas from local governments to the Corporation Commission. ¶11 Magnum also claims that we have previously decided this issue via an unpublished order in another matter, Oklahoma Oil & Gas Ass'n v. Kingfisher Cty. Comm'rs, No. 117,303 (OKLA. SUP. CT. Dec. 17, 2018), reh'g denied, (OKLA. SUP. CT. Jan. 22, 2019). In that case, the Oklahoma Oil & Gas Association sought to enjoin the Kingfisher County Commissioners from imposing a ban on the transportation of wastewater through temporary lines crossing county road easements. The Oklahoma Oil & Gas Association alleged that the ban exceeded the scope of authority afforded to the county commissioners under § 137.1. We found that the Commissioners' ban on temporary wastewater lines was not authorized by § 137.1 because it did not fall within any of the three areas preserved for municipal regulation.2 ¶12 Board argues that § 137.1 does not comprise the full scope of municipal authority to regulate oil and gas production. Specifically, Board contends that municipalities maintain a general police power to provide for the safety and wellbeing of their inhabitants, and pursuant to that authority, municipalities may impose regulations on oil and gas production that go beyond the categories enumerated in § 137.1. In support of its position, Board cites to a number of our prior decisions recognizing this municipal police power, most notably Gant v. Oklahoma City, 1931 OK 241, 6 P.2d 1065. In Gant, we addressed a challenge to a similar insurance requirement imposed by an Oklahoma City municipal ordinance. Id. ¶ 12, 6 P.2d at 1068-69. We upheld the ordinance as a legitimate exercise of the city's police power: An examination of the cases cited under proposition 1 does not disclose that there is anything in them that would warrant us in holding that the general police power of Oklahoma City to provide for the safety and health of its inhabitants is in any way taken away by virtue of the jurisdiction conferred upon the Corporation Commission to superintend the drilling for oil and gas, and their carrying and preservation. Gant, 1931 OK 241, ¶ 11, 6 P.2d at 1068. ¶13 Board also rejects Magnum's arguments that the Legislature intended to curtail municipal authority by replacing § 137 with § 137.1. Specifically, Board argues that if the Legislature intended to divest municipalities of their police power and give exclusive jurisdiction to the Corporation Commission, it would have done so by amending 17 O.S. § 52, which establishes the regulatory authority of the Corporation Commission. Board maintains that merely replacing § 137 with § 137.1 shows that the Legislature did not intend to significantly alter the concurrent jurisdiction of municipalities and the Corporation Commission. ¶14 As for our order in the Kingfisher County matter, Board notes that unpublished orders of this kind do not have precedential value. Sup. Ct. R. 1.200; Bilbrey v. Cingular Wireless, L.L.C., 2007 OK 54, ¶ 23 n.7, 164 P.3d 131, 136 n.7. Board further argues that even if the order did have precedential value, it would not resolve the present matter since it was limited to the question of whether the temporary pipeline ban constituted a regulation concerning road use. ¶15 While the precise issue raised in this appeal has not come before this Court, it has been raised in other settings. Shortly after the enactment of § 137.1, several members of the Legislature requested an Attorney General Opinion on a number of questions related to the effect of § 137.1 on municipal authority to regulate oil and gas.3 Among other things, the legislators explicitly asked whether municipalities could "regulate aspects of oil and gas operations that are not specifically enumerated in Section 137.1." Question Submitted by: Hon. Mike Ritze, State Rep., Dist. 80; Hon. Chris Kannady, State Rep., Dist. 91; Hon. Kevin Calvey, State Rep., Dist. 82, 2015 OK AG 12, ¶ 0. The Attorney General concluded that it was "clear from the entirety of Senate Bill 809 [the legislation repealing § 137 and creating § 137.1] that the Legislature intended to limit local regulation to the areas specifically enumerated therein." Id. ¶ 12. ¶16 On review, we find no basis in statute or our prior decisions for the general municipal police power asserted by Board. Board's position rests on our prior decision in Gant. While it is true that in Gant we recognized a general municipal police power to regulate oil and gas production, Board's position fails to account for the effect of statutory changes since Gant was decided. ¶17 Gant was decided in 1931. Until 2015, Oklahoma statutory and jurisprudential law, including Gant and its progeny, clearly embraced broad municipal authority to regulate oil and gas production. Section 137 afforded municipalities the authority to prohibit oil and gas production altogether and explicitly recognized a municipality's police power to impose other regulations. With the repeal of § 137 and adoption of § 137.1, the Legislature drastically curtailed the jurisdiction of municipalities to regulate oil and gas production. Notably, in § 137.1, the Legislature omitted any reference to municipal police power, instead reserving specific and limited areas of regulation for municipal control. The Legislature also explicitly precluded municipalities from prohibiting oil and gas production and made all other regulations of oil and gas production subject to the exclusive jurisdiction of the Corporation Commission. ¶18 "The goal of any inquiry into the meaning of a statutory enactment is to ascertain and give effect to the intent of the legislature." See Yocum, 2005 OK 27, ¶ 9, 130 P.3d at 219. In instances like this, which involve statutory changes or amendments, we have established principles for ascertaining the intent of the Legislature: Where a statute is amended the Legislature may have intended either, (1) to effect a change in existing law, or (2) to clarify that which was previously doubtful. Which purpose was intended by a particular amendment is to be determined to some extent from the circumstances surrounding its enactment. Where the former statute was clear, or where its meaning had been judicially determined, the amendment may reasonably indicate that the intention of the Legislature was to alter the law. On the other hand where the meaning of the former statute was subject to serious doubt, or where controversies concerning its meaning had arisen, it may be presumed that the amendment was made to more clearly express the legislative intention previously indefinitely expressed. Magnolia Pipe Line Co. v. Oklahoma Tax Commission, 1946 OK 113, ¶ 11, 167 P.2d 884, 888 (internal citations omitted); see also Polymer Fabricating, Inc. v. Employers Workers' Compensation Ass'n, 1998 OK 113, ¶ 15 n.18, 980 P.2d 109, 114 n.18. ¶19 In this instance, the Legislature's decision to repeal § 137 and replace it with § 137.1 clearly falls into the former category. Prior to 2015, a review of § 137 and our extant jurisprudence would have made clear that municipalities maintained broad authority to regulate oil and gas production pursuant to their police power. Furthermore, there were no plain or obvious ambiguities in the text of § 137 to necessitate an amendment. More importantly, to the extent there were ambiguities in the text of § 137, we find that § 137.1 was not intended to resolve them. Rather, § 137.1 fundamentally altered the nature of the concurrent jurisdiction shared by municipalities and the Corporation Commission. This restructuring included removing a municipality's police power to regulate oil and gas. Thus, based on the foregoing, we find that municipal authority to regulate oil and gas is limited in scope to those areas reserved in § 137.1 and elsewhere in statute. ¶20 The umbrella insurance requirement in § 13-1502.1(a)(4) does not fall within any of the categories reserved for municipal regulation under § 137.1. Section 13-1502.1(a)(4) does not qualify as an ordinance concerning road use, traffic, noise and odors incidental to oil and gas operation. Section 13-1502.1(a)(4) also does not constitute a setback or fencing requirement for oil and gas well sites, nor does it concern the development of areas delineated as a one-hundred-year floodplain. The only other source of municipal authority referenced by either party is 17 O.S. § 52(B), which states, "The Corporation Commission and incorporated cities and towns shall have exclusive jurisdiction over permit fees for the drilling and operation of oil and gas wells." While satisfying the umbrella insurance requirement in § 13-1502.1(a)(4) is necessary to obtain a permit in Norman, it cannot be fairly characterized as a permit fee. Based on the foregoing, we find that § 13-1502.1(a)(4) of the Norman Municipal Code is irreconcilable with state law. IV. CONCLUSION ¶21 With the enactment of 52 O.S.Supp.2015 § 137.1 in 2015, the Legislature sought to change the nature of the concurrent jurisdiction of municipalities and the Corporation Commission. Municipalities no longer possess a broad police power to regulate oil and gas. Section 13-1502.1(a)(4) exceeds the scope of authority to regulate oil and gas production reserved for municipalities in § 137.1 and elsewhere in statute. We find that § 13-1502.1(a)(4) conflicts with 52 O.S. § 137.1, rendering § 13-1502.1(a)(4) invalid and unenforceable. Accordingly, COCA's opinion is hereby vacated, and the judgment of the trial court is affirmed. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF THE TRIAL COURT AFFIRMED. ALL JUSTICES CONCUR. FOOTNOTES 1 Title 52, § 137.1 reads as follows: A municipality, county or other political subdivision may enact reasonable ordinances, rules and regulations concerning road use, traffic, noise and odors incidental to oil and gas operations within its boundaries, provided such ordinances, rules and regulations are not inconsistent with any regulation established by Title 52 of the Oklahoma Statutes or the Corporation Commission. A municipality, county or other political subdivision may also establish reasonable setbacks and fencing requirements for oil and gas well site locations as are reasonably necessary to protect the health, safety and welfare of its citizens but may not effectively prohibit or ban any oil and gas operations, including oil and gas exploration, drilling, fracture stimulation, completion, production, maintenance, plugging and abandonment, produced water disposal, secondary recovery operations, flow and gathering lines or pipeline infrastructure. All other regulations of oil and gas operations shall be subject to the exclusive jurisdiction of the Corporation Commission. Provided, notwithstanding any provision of law to the contrary, a municipality, county or other political subdivision may enact reasonable ordinances, rules and regulations concerning development of areas within its boundaries which have been or may be delineated as a one-hundred-year floodplain but only to the minimum extent necessary to maintain National Flood Insurance Program eligibility. 2 In doing so, we provided the following analysis: Title 52, section 137.1 does not authorize the county to enact Resolution No. 23. The resolution cannot be characterized as a regulation concerning "road use," as the appearance of that term in the first sentence of section 137.1 contemplates a vehicle's use of roads incidental to oil and gas operations. Even if the resolution could be characterized as a regulation concerning "road use," it would be void as being inconsistent with 52 O.S.Supp.2017 § 139(A), (B)(1)(i) and with the Corporation Commission's regulation found in section 165:10-7-24 of the Oklahoma Administrative Code. See 52 O.S.Supp.2017 § 137.1 ("A ... county ... may enact reasonable ordinances, rules and regulations concerning road use ... incidental to oil and gas operations within its boundaries, provided such ordinances, rules and regulations are not inconsistent with any regulation established by Title 52 of the Oklahoma Statutes or the Corporation Commission." (emphasis added)). Further, Respondents have not and cannot justify the resolution as a "setback" or "fencing requirement" for an oil and gas well site location, nor as a regulation "concerning development of areas ... which have been or may be delineated as a one-hundred-year floodplain." See id. Consequently, Respondents lack authority to issue a regulation like Resolution No. 23 because section 137.1 mandates that exclusive jurisdiction to enact such a regulation lies in the Corporation Commission. See § 137.1; accord 52 O.S.Supp.2017 § 139(A), (B)(1)(i); 17 O.S.Supp.2017 § 52(A)(1)(i); 27A O.S.Supp.2017 § 1-3-101(E)(1)(i). Oklahoma Oil & Gas Ass'n v. Kingfisher Cty. Comm'rs, No. 117,303 at 2-3 (OKLA. SUP. CT. Dec. 17, 2018), reh'g denied, (OKLA. SUP. CT. Jan. 22, 2019) (emphasis in original). It does not appear that the question of whether the ban might have been authorized pursuant to a general municipal police power was raised by the county commissioners or addressed in this Court's order granting the Oil & Gas Association's requested injunctive relief. 3 Attorney General opinions are not binding on this Court, but they may be persuasive authority. Edwards v. Bd. of Cty. Comm'rs of Canadian Cty., 2015 OK 58, ¶ 15, 378 P.3d 54, 60.

87b27823-3b0f-4c3e-b47a-7c9692fdc44c

Meng v. Rahimi

oklahoma

Oklahoma Supreme Court

MENG v. RAHIMI2022 OK 11Case Number: 119051; Consol. w/119196Decided: 02/01/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL.     LI MENG, Defendant/Appellant, v. MOHAMMAD RAHIMI AND TAHEREH DINPAJOOH, Plaintiffs/Appellees. ON WRIT OF CERTIORARI TO REVIEW INTERLOCUTORY ORDER ¶0 Tenant petitioned for certiorari review of a certified interlocutory order urging that the trial court erred in failing to consider the affirmative defense of impracticability or frustration of purpose to excuse the nonpayment of rent for a parcel of commercial property and awarding past due rent and possession to Landlords. The trial court did not allow Tenant to present evidence in support of her affirmative defense. The trial court entered an interim Order awarding to the Landlords possession of the premises and five months of past due rent in the amount of $6,400 and reserved issues relating to damages and liability for ongoing rent for future consideration. The trial court certified the judgment as an interlocutory order for immediate appeal. We hold that the trial court erred by not allowing Tenant to present evidence relating to her affirmative defense of impracticability or frustration of purpose. PETITION FOR CERTIORARI TO REVIEW A CERTIFIED INTERLOCUTORY ORDER PREVIOUSLY GRANTED; ORDER OF THE DISTRICT COURT REVERSED; AND CAUSE REMANDED FOR PROCEEDINGS CONSISTENT WITH OPINION. James S. Matthews, Jr., Oklahoma City, Oklahoma, for Petitioner/Appellant, Mohammad Rahimi, Respondent/Appellee, Pro Se, Tahereh Dinpajooh, Respondent/Appellee, Pro Se. OPINION Edmondson, J.: ¶1 This certified interlocutory order presents multiple issues, but central to the resolution is whether a Tenant should be allowed to present evidence of the affirmative defense of frustration of purpose and impracticability as a defense to a forcible entry and detainer action to excuse a commercial tenant's nonpayment of rent during the period of time of alleged impracticability. We hold under these limited facts, Tenant should have been allowed the opportunity to present evidence in support of her defense. The trial court erred when it did not allow Tenant to present evidence in support of the affirmative defense.1   FACTUAL AND PROCEDURAL BACKGROUND   ¶2 Li Meng ("Tenant") leased a commercial property from the Plaintiffs, Mohammad Rahimi and Tahereh Dinpajooh ("Landlords") in August, 2019 for the sole purpose of operating a massage business for a two year term.2 The parties specifically agreed in the written lease that Meng's use of the commercial space was for the sole purpose of conducting a massage business and Meng was prohibited from using the space for any other purpose.3 The Landlords prohibited any use of the leased premises which could endanger life.4 ¶3 The Landlords noted that even though Tenant was prohibited from any use of the premises which violated public law or governmental rule, the lease specified there would be no abatement of rent even if there was a loss of business arising from some future law. 5 Landlords argued that Meng's obligation to pay rent was not excused because of these lease provisions. ¶4 In January, 2020, approximately five months after the parties executed the lease, the first case of the COVID-19 virus was reported within the United States and soon thereafter in Oklahoma. In March, the Oklahoma governor declared a state of emergency due to COVID-19 and businesses that were not part of critical infrastructure were ordered to close for a period of time. ¶5 Meng stated that she closed the business on March 19, 2020 after she and her sole employee became ill with symptoms of the COVID-19 virus.6 Meng did not pay rent after March, 2020, and she never re-opened her business. ¶6 On June 15, 2020, Landlords filed this action against the Tenant for past due rent and eviction. At the hearing on August 12, 2020, Tenant argued that rent was not due from April through August because performance of the contract had become impossible in light of the public health risk with massage which temporarily excused the payment of rent under the doctrine of frustration of purpose or impracticability. Counsel for Tenant announced there were witnesses available to testify at the hearing in support of this affirmative defense. Landlords argued that they were entitled to possession and unpaid rent and asked the trial court to award rent and for counterclaims or offsets to be determined in a separate action filed by Meng seeking declaratory relief. The court stated that the defense of impracticability was not a legitimate excuse for the nonpayment of rent and did not allow Meng to present any evidence in support of this defense. The trial court awarded Landlords $6,400 in past due rent and granted them possession. ¶7 After the trial court certified its order for discretionary interlocutory appellate review pursuant to 12 O.S. 2011 §952(b)(3), Meng filed a Petition for Certiorari seeking certiorari review of the certified interlocutory order. We granted certiorari. Briefing was completed by the parties on June 28, 2021. Consolidated within this matter by order of this Court, is a separate appeal filed by Meng asserting the trial court erred by awarding attorney fees to Landlords as prevailing party. 7   STANDARD OF REVIEW   ¶8 The parties agree that the standard for appellate review in this matter is de novo, as the principal issue for review is whether the trial court erred in failing to permit Tenant the opportunity to present evidence of her affirmative defense of impracticability or frustration of purpose. In exercising our general appellate jurisdiction, we review issues that present pure questions of law de novo. Lincoln Farm, L.L.C. v. Oppliger, 2013 OK 85, ¶ 12, 315 P.3d 971, 975. LEGAL ANALYSIS ¶9 Parties enter into contracts to provide a degree of certainty in their business transactions. Krug v. Helmerich & Payne, Inc., 2013 OK 104, ¶ 35, 320 P.3d 1012, 1022. An essential principle of contract law is to give force and effect to the consensual formation of relationships and bargained-for-duties within the parties' agreement. Id. This Court cannot make a better contract for the parties than what they have negotiated. Id.; See also, Berry and Berry Acquisitions, LLC v. BFN Properties, LLC, 2018 OK 27, ¶ 13, 416 P.3d 1061, 1068. ¶10 Meng's only defense to nonpayment of rent was that the failure to pay was excused under the recognized affirmative defense of impossibility, impracticability or frustration of purpose of contract. Meng argued that because her nonpayment was excused by this affirmative defense, Landlords were not entitled to unpaid rent from April through July, 2020. Meng announced she had witnesses available to testify and other evidence available to support her defense. The trial court refused Meng the opportunity to present her defense. On appeal, Meng noted that this theory has been recognized by this Court as a defense to the nonperformance of a contract caused by a supervening impossibility. Oklahoma Ry Co. v. Grand Lake Grain Co., 1967 OK 170, 434 P.2d 153. Meng urged that at the time the commercial lease was executed, the parties implicitly assumed there would not be a worldwide pandemic which could render the use of the commercial property for providing massage, a use which may endanger life and be a threat to public health and safety. ¶11 Landlords argued that the state and federal agencies put a moratorium on personal residences and payments of rent due to the pandemic, but there was no such relief for commercial properties. Landlords also urged that Meng could have continued her business as Oklahoma personal care service businesses were allowed to reopen in late April, 2020. ¶12 This Court has recognized the doctrine of impossibility to excuse nonperformance by a party to a contract under limited circumstances. Cosden Oil & Gas Co. v. Moss, 1928 OK 352, 267 P. 855; See also Oklahoma Gas and Elec. Co. v. Pinkerton's Inc., 1986 OK 61, 742 P.2d 546. This rule is typically limited to "the situation where neither party is at fault and neither has assumed the risk." Kansas, Oklahoma & Gulf. Ry. Co. v. Grand Lake Grain Co., 1967 OK 170, ¶ 18, 434 P.2d 153, 157. Citing an earlier edition of the Restatement of the Law of Contracts, we noted that impossibility "means not only strict impossibility but impracticability because of extreme and unreasonable difficulty, expense, injury or loss involved." Id. ¶ 21, 434 P.2d at 158. Similar to the matter before us, the trial court in Grand Lake Grain refused defendant's request to introduce evidence supporting its only defense to the litigation, the affirmative defense of impossibility. The trial court's ruling precluded defendant's right to defend asserted claims. We held there as we do in the instant matter, the court erred as a matter of law for not allowing the defendant to present evidence of the defense. ¶13 Because contractual responsibilities are essential to predictability for the parties, this defense has many inherent safeguards. The circumstance giving rise to the conditions of impossibility must have not been foreseeable or anticipated by the parties, and the person unable to perform must not be at fault. Id. at ¶20, 434 P.2d at 158. Even if it can be established that the circumstance was neither foreseeable or anticipated by the parties, impossibility of performance is further restricted, and a distinction is drawn between objective and subjective impossibility. Pinkerton's supra. at ¶ 8, 742 P.2d at 548. Objective impossibility may excuse performance of a contract, but a party must prove that performance could not be done by anybody. Id. To the contrary, subjective impossibility does not excuse performance and arises when the failure to perform arises from the personal inability of a promisor to perform. ¶14 This forcible entry and detainer action was filed in small claims court and is governed by the Small Claims Procedure Act, 12 O.S.2011 §§ 1751 -- 1773. Although the object of this Act is the efficient and prompt disposition of claims and defenses,8 the Legislature did not intend to do away with fundamental due process and the right to defend an action. Johnson v. Scott, 1985 OK 50, ¶ 12, 702 P.2d 56, 58. Section 1761 of this Act grants each party the right to present evidence and witnesses before a court. Id. ¶15 We offer no opinion on Meng's ability to establish the requirements of her defense, and for what length of time, if any, said impossibility existed. Because supervening impossibility is a recognized affirmative defense to nonperformance of a contract, Meng is entitled to present evidence in support of it. The trial court erred in not allowing this testimony. Its interlocutory order awarding $6,400 is reversed, and the cause is remanded to the trial court for further proceedings consistent with this opinion. ¶16 Darby, C.J., Kauger, Edmondson, Combs, and Gurich, JJ., concur; ¶17 Kane, V.C.J. (by separate writing), concurs in result; ¶18 Winchester (by separate writing), Rowe, and Kuehn, JJ., dissent. FOOTNOTES 1 ROA, Doc. #23, Hr'g. Tr., Aug. 12, 2020. 2 Commercial leases are not regulated by the Oklahoma Residential Landlord Tenant Act. 41 O.S. 2011 § 51. 3 ROA, p. 56, Doc. #9, Am. Sp. Appearance and Mot. to Dismiss, ex. A at 73. 4 Id. 5 Id. at 74. 6 Pet. for Cert., Nov. 12, 2020. 7 Meng's companion case asserting error in the granting of attorney fees to Landlords, 119,196 was consolidated with the instant matter, 119,051. Meng did not raise any issue regarding attorney fees in her brief in chief. This issue will not be considered by this Court. Sup. Ct. Rules 1.11 (k) and 1.40 (c). 8 Patterson v. Beall, 2000 OK 92, 19 P.3d 839.     KANE, V.C.J., concurring in result: ¶1 While Plaintiffs may correctly foretell that the final result of this litigation is that the tenant has no viable defense, I concur, procedurally, to remand this matter to the trial court to complete the evidence before the issue is finally resolved. ¶2 This action was filed in small claims court, which has limited jurisdiction and limited pretrial procedure. Discovery is not allowed. See 12 O.S.2011 § 1760. No pretrial motions are allowed, except for motions to transfer the small claims action to the regular civil docket. See 12 O.S.Supp.2017 § 1757; Patterson v. Beall, 2000 OK 92, ¶¶ 11, 24, 19 P.3d 839, 843, 845. In the present case, the Defendant interposed a written motion to dismiss, and the Plaintiffs submitted a response. On the strength of the argument of the Plaintiffs, the Court entered judgment for the Plaintiffs without taking evidence. ¶3 Because I believe that it was procedurally improper to take up the motion prior to submission of the case, I would remand the matter to the trial court for submission of the evidence, without any further analysis at this point.     Winchester, J., with whom Kuehn, J. joins, dissenting: ¶1 The Court has long refused to rewrite contracts. The majority recognizes as much when it reiterates the long-standing point that a court cannot put the parties in a better position than what they negotiated in the contract. Krug v. Helmerich & Payne, Inc., 2013 OK 104, ¶ 35, 320 P.3d 1012, 1022. Yet the Court ignores precedent and rewrites the contract to the detriment of Appellees Mohammad Rahimi and Tahereh Dinpajooh (Landlords). ¶2 The district court correctly determined that the affirmative defenses of frustration of purpose, impracticability, and impossibility did not apply as a matter of law due to the controlling language in the parties' commercial lease agreement. The parties entered into an Oklahoma Commercial Lease Agreement, which did not allow abatement for rent in circumstances such as a pandemic: 6.2 EFFECTS ON RENTS. TENANT shall have no abatement, diminution, or reduction of the Rents for any inconvenience, interruption, cessation or loss of business or otherwise caused, directly or indirectly, by any present or future Public Law or by curtailment of labor or materials, or by war, civil commotion, strikes, or riots, or any matter of things resulting therefrom, or by other causes beyond the control of the LANDLORD. (emphasis added). ¶3 The parties contracted for Appellant Li Meng (Tenant) to pay rent during any interruption or loss of business if the loss was caused by something beyond the control of Landlords. The pandemic was beyond the control of Landlords. None of the affirmative defenses raised by Tenant are applicable when there was language in the commercial lease that controlled in what scenarios performance was discharged. See Restatement (Second) of Contracts §§ 261, 263, 265 (Am. Law Inst. 1981) (stating performance is discharged under the doctrines of impossibility, frustration of purpose, or impracticability "unless the language or circumstance indicate the contrary"). Per the language of the commercial lease, Tenant was not absolved of her obligation to pay rent if governmental pandemic orders forced Tenant to shut down her business or if a pandemic market decline caused her to lose business. Clause 6.2 of the commercial lease ends the inquiry. The affirmative defenses are not applicable as a matter of law, and there is no reason to remand this case back to district court to allow evidence of these extra-contractual theories. ¶4 It is a fact that the market decline during the pandemic was a widespread issue, impacting conceivably every business. Yet in Oklahoma, exactly one month after Governor Kevin Stitt's temporary executive order closing all non-essential businesses, personal care businesses (like Tenant's) could reopen.1 The majority of hair salons, barbershops, spas, nail salons, and other personal care businesses reopened in Oklahoma and provided services with safety protocols in place. Tenant chose to keep her business closed and continued to not pay rent. Landlords waited until June 15th, almost two months after Tenant chose not to reopen her business, to file a forcible entry and detainer action. Tenant was permitted to run her business during those two months but chose not to operate her business to generate income. Tenant continued to remain closed and not pay rent until the trial on August 12th, almost four months after she could reopen her business. ¶5 To permit these affirmative defenses to apply to a commercial tenant here, one who chose to not reopen her business and, in turn, stopped paying rent, would raise countless questions: would it apply to every commercial tenant? If not, what are the criteria to qualify for such relief? What about commercial tenants operating during the pandemic but still losing business? Granting relief to Tenant in a make-shift fashion when she was able to conduct business would yield inconsistent and unfair results for all other commercial tenants and landlords. While I empathize with Tenant's plight, I cannot ignore the language in the parties' commercial lease or the fact that Landlords had specific obligations from their ownership of the building that they had to meet despite Tenant refusing to operate her business and pay rent. For these reasons, I dissent. FOOTNOTES 1 See Open Up and Recover Safely, A Three-phased Approach to Open Oklahoma's Economy 2 (April 22, 2020), available at https://www.okcommerce.gov/wp-content/uploads/Open-Up-and-Recover-Safely-Plan.pdf.  

c422dd54-99f4-4e2b-ab16-a60fe95afbdc

Nicholson v. Stitt

oklahoma

Oklahoma Supreme Court

NICHOLSON v. STITT2022 OK 35Case Number: 119270Decided: 04/19/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JASON NICHOLSON, JUSTIN HOOPER, CAEL BURGESS, DEREK HAIR, and others similarly situated, Plaintiffs/Appellants, v. KEVIN STITT, in his official capacity as Governor; STEVE KUNZWEILER, in his official capacity as District Attorney of Tulsa County; CAROL ISKI, in her official capacity as District Attorney of McIntosh and Okmulgee Counties; JACK THORP, in his official capacity, District Attorney of Wagoner County; MAX COOK, in his official capacity, District Attorney of Creek and Okfuskee Counties; ORVIL LOGE, in his official capacity, District Attorney of Muskogee County; PAUL SMITH, in his official capacity, District Attorney of Hughes County; MATTHEW BALLARD, in his official capacity, District Attorney of Mayes and Rogers Counties; THE CITY OF BEGGS; THE CITY OF BIXBY; THE CITY OF BOLEY; THE CITY OF BRISTOW; THE CITY OF BROKEN ARROW; THE CITY OF CATOOSA; THE TOWN OF CHECOTAH; THE CITY OF COWETA; THE TOWN OF CROMWELL; THE TOWN OF DEPEW; THE TOWN OF DEWAR; THE CITY OF DRUMWRIGHT; THE CITY OF EUFAULA; THE CITY OF GLENPOOL; THE TOWN OF HASKELL; THE CITY OF HENRYETTA; THE CITY OF HOLDENVILLE; THE TOWN OF INOLA; THE CITY OF JENKS; THE TOWN OF KELLYVILLE; THE TOWN OF KIEFER; THE CITY OF MANNFORD; THE CITY OF MORRIS; THE TOWN OF MOUNDS; THE CITY OF MUSKOGEE; THE CITY OF OILTON; THE CITY OF OKEMAH; THE CITY OF OKMULGEE; THE TOWN OF PORTER; THE CITY OF SAND SPRINGS; THE CITY OF SAPULPA; THE CITY OF TULSA; THE CITY OF WAGONER; THE TOWN OF WELEETKA; THE CITY OF WETUMKA; and THE CITY OF WEWOKA. Defendants/Appellees, and THE TOWN OF SUMMIT, Defendant. ON APPEAL FROM THE DISTRICT COURT OF OKMULGEE COUNTY, STATE OF OKLAHOMA HONORABLE PANDEE RAMIREZ, DISTRICT JUDGE ¶0 Plaintiffs/Appellants Jason Nicholson, Justin Hooper, Cael Burgess, and Derek Hair (collectively, Plaintiffs) appeal the trial court's order dismissing their claims for money had and received against Defendants/Appellees Governor Kevin Stitt and certain district attorneys and municipalities which are alleged to be located within the boundaries of the Muscogee (Creek) Nation. Plaintiffs claim that, according to McGirt v. Oklahoma, ___ U.S. ___, 140 S. Ct. 2452 (2020), the State and municipalities did not have jurisdiction to prosecute them for crimes committed on the Creek Reservation. Plaintiffs argue their convictions are void ab initio and seek the return of fines and fees they paid to the State and municipalities. We affirm the trial court's order of dismissal. Plaintiffs' criminal judgments and sentences have not been vacated pursuant to the Post-Conviction Procedure Act, 22 O.S.2011 & Supp.2014 §§ 1080-1089. As a result, Plaintiffs have failed to state a claim for money had and received. ORDER OF THE DISTRICT COURT IS AFFIRMED. John M. Dunn and Kevin D. Adams, Tulsa, Oklahoma, for Appellants. Jacqueline R. Zamarripa and Randall J. Yates, Oklahoma Attorney General's Office, Oklahoma City, Oklahoma, for Appellees Kevin Stitt, Steve Kunzweiler, Carol Iski, Jack Thorp, Max Cook, Orvil Loge, Paul Smith, and Matthew Ballard. Andrew W. Lester, Shannon F. Davies, Courtney D. Powell, Anthony J. Ferate, Spencer Fane LLP, Oklahoma City, Oklahoma, for Appellees City of Beggs, City of Bixby, Town of Boley, City of Bristow, City of Catoosa, City of Checotah, City of Coweta, Town of Cromwell, Town of Depew, Town of Dewar, City of Drumwright, City of Eufaula, City of Glenpool, Town of Haskell, City of Henryetta, City of Holdenville, Town of Inola, City of Jenks, Town of Kellyville, Town of Kiefer, Town of Mannford, City of Morris, Town of Mounds, City of Muskogee, Town of Oilton, City of Okemah, City of Okmulgee, Town of Porter, City of Sand Springs, City of Sapulpa, City of Wagoner, City of Weleetka, City of Wetumka, and City of Wewoka. Gerald L. Bender and R. Lawson Vaughn, City of Tulsa, Tulsa, Oklahoma, for Appellee City of Tulsa. John J. Bowling and Alexander J. Sisemore, City of Broken Arrow, Broken Arrow, Oklahoma, for Appellee City of Broken Arrow. KANE, V.C.J.: ¶1 On July 9, 2020, the United States Supreme Court handed down its decision in McGirt v. Oklahoma, ___ U.S. ___, 140 S. Ct. 2452 (2020). The United States Supreme Court determined that Congress never disestablished the Creek Reservation in eastern Oklahoma and, therefore, it is "Indian country" for purposes of the Major Crimes Act, 18 U.S.C. § 1153. Under the Major Crimes Act, "[o]nly the federal government, not the State, may prosecute Indians for major crimes committed in Indian country." McGirt, 140 S. Ct. at 2478. ¶2 Relying on McGirt, Plaintiffs/Appellants Jason Nicholson, Justin Hooper, Cael Burgess, and Derek Hair (collectively, Plaintiffs) filed the underlying civil suit for money had and received. Plaintiffs seek to recover fines and fees they were ordered to pay as a result of allegedly unlawful prosecutions by the State and certain municipalities. We hold that the trial court properly dismissed Plaintiffs' claims for money had and received. FACTS AND PROCEDURAL HISTORY ¶3 Less than a week after the United States Supreme Court decided McGirt, Plaintiffs filed the underlying civil action to recover money had and received against Defendants/Appellees Kevin Stitt, in his official capacity as Governor; Steve Kunzweiler, in his official capacity as District Attorney of Tulsa County; Carol Iski, in her official capacity as District Attorney of McIntosh and Okmulgee Counties; Jack Thorp, in his official capacity as District Attorney of Wagoner County; Max Cook, in his official capacity as District Attorney of Creek and Okfuskee Counties; Orvil Loge, in his official capacity as District Attorney of Muskogee County; Paul Smith, in his official capacity as District Attorney of Hughes County; Matthew Ballard, in his official capacity as District Attorney of Mayes and Rogers Counties; the City of Beggs; the City of Bixby; the City of Boley; the City of Bristow; the City of Broken Arrow; the City of Catoosa; the Town of Checotah; the City of Coweta; the Town of Cromwell; the Town of Depew; the Town of Dewar; the City of Drumwright; the City of Eufaula; the City of Glenpool; the Town of Haskell; the City of Henryetta; the City of Holdenville; the Town of Inola; the City of Jenks; the Town of Kellyville; the Town of Kiefer; the City of Mannford; the City of Morris; the Town of Mounds; the City of Muskogee; the City of Oilton; the City of Okemah; the City of Okmulgee; the Town of Porter; the City of Sand Springs; the City of Sapulpa; the Town of Summit; the City of Tulsa; the City of Wagoner; the Town of Weleetka; the City of Wetumka; and the City of Wewoka (collectively, the State and Municipalities).1 In their petition, Plaintiffs allege they are members of the Cherokee Nation and that the State and Municipalities prosecuted them without jurisdiction. Plaintiffs assert that the political subdivisions are located, at least, in part within the boundaries of the Muscogee (Creek) Nation. Plaintiffs claim that the State and Municipalities were unjustly enriched through the collection of fines, costs, assessments, probationary fees, and other monies. Plaintiffs contend that, pursuant to McGirt, the State and Municipalities should be required to refund all or at least a portion of the money acquired without lawful authority. ¶4 The State and Municipalities filed motions to dismiss. Collectively, they argued the claims should be dismissed because Plaintiffs were required to seek post-conviction relief under Oklahoma's Uniform Post-Conviction Procedure Act, 22 O.S.2011 & Supp.2014 §§ 1080-1089, the trial court lacked subject matter jurisdiction, Plaintiffs failed to state a claim for money had and received, and § 14 of the Curtis Act precluded Plaintiffs' claims. The State and Municipalities also asserted equitable defenses and argued that venue was improper. The motions to dismiss were heard together. The trial court granted the motions to dismiss on the basis of lack of venue, lack of subject matter jurisdiction, and § 14 of the Curtis Act. The trial court denied Plaintiffs' request for leave to amend their petition finding any amendment would be futile and dismissed the case with prejudice. Plaintiffs appealed, and this Court retained the appeal sua sponte. STANDARD OF REVIEW ¶5 A district court's dismissal of an action is reviewed de novo. See Kirby v. Jean's Plumbing Heat & Air, 2009 OK 65, ¶ 5, 222 P.3d 21, 23. The purpose of a motion to dismiss is to test the law that governs the claim, not the facts. Id. ¶ 5, at 24. A motion to dismiss for failure to state a claim upon which relief may be granted will not be sustained unless it appears without doubt that the plaintiff can prove no set of facts which would entitle the plaintiff to relief. Id. Thus, the Court must take as true all of the allegations in the challenged pleading together with all reasonable inferences that can be drawn from them. Id. Dismissal is appropriate only when there is no cognizable legal theory to support the claim or insufficient facts under a cognizable legal theory. Id. ¶6 Whether the trial court erred in denying Plaintiffs' request to amend their petition is reviewed for an abuse of discretion. See Prough v. Edinger, Inc., 1993 OK 130, ¶ 8, 862 P.2d 71, 75. However, that discretion is limited by 12 O.S.Supp.2018 § 2015(A), which provides that leave to amend be freely given when justice so requires. Id. ANALYSIS ¶7 In their motions to dismiss, the State and Municipalities argue this civil suit for money had and received is a collateral attack on a criminal conviction and that Plaintiffs are required to seek relief under the Post-Conviction Procedure Act, 22 O.S. §§ 1080-1089. Plaintiffs respond that, pursuant to McGirt, their convictions are void ab initio and that they are not required to seek post-conviction relief to vacate a void judgment and sentence. Plaintiffs write: "[T]he state convictions were made without subject matter jurisdiction, and are currently void, regardless of any collateral review (in fact, post-conviction review is not possible because there is no valid conviction to review)." During the hearing, Plaintiffs described McGirt as "self-executing," meaning if the State or its political subdivisions did not have jurisdiction under McGirt, a criminal defendant does not have to do anything to obtain relief from a void judgment and sentence. Plaintiffs assert that "[t]here's nothing left for a court to do." ¶8 Plaintiffs are correct that a judgment and sentence entered by a court without subject matter jurisdiction is void ab initio.2 However, the soundness of their argument stops there. Contrary to Plaintiffs' notion, their convictions and sentences did not simply vanish the moment the United States Supreme Court issued its decision in McGirt. A final judgment and sentence can only be vacated through a timely appeal or by seeking post-conviction relief under the Post-Conviction Procedure Act. See 22 O.S.2011 § 1080 ("Excluding a timely appeal, this act encompasses and replaces all common law and statutory methods of challenging a conviction or sentence."). The Act specifically gives "[a]ny person who has been convicted of, or sentenced for, a crime and who claims . . . that the court was without jurisdiction to impose sentence" the right to challenge the judgment and sentence. Id. § 1080(b). Such "[a] proceeding is commenced by filing a verified 'application for post-conviction relief' with the clerk of the court imposing judgment if an appeal is not pending." Id. § 1081. The sentencing court then makes findings of fact to determine if, as a matter of law, it had jurisdiction under McGirt. Decisions from the sentencing court can be appealed to the Court of Criminal Appeals. See id. § 1087. If an individual is not successful in having the judgment and sentence vacated through a post-conviction relief proceeding, the judgment and sentence remains in force. The United States Supreme Court contemplated as much in McGirt, noting that "many defendants may choose to finish their state sentences rather than risk reprosecution in federal court where sentences can be graver. Other defendants who do try to challenge their state convictions may face significant procedural obstacles, thanks to well-known state and federal limitations on post-conviction review in criminal proceedings." McGirt, 140 S. Ct. at 2479. ¶9 Plaintiffs' position that a legal proceeding is not necessary to vacate a void judgment and sentence, albeit creative, is without merit. A void judgment has long been described as a "dead limb upon the judicial tree, which may be lopped off at any time." Pettis v. Johnston, 1920 OK 224, ¶ 0, 190 P. 681, 682 (Syllabus by the Court, No. 10). If individuals affected by the McGirt decision want their state and municipal court convictions and sentences vacated, they must affirmatively challenge jurisdiction using the Post-Conviction Procedure Act.3 If court action were not required to vacate a void judgment and sentence, anyone could self-declare that, according to McGirt, the court imposing the sentence was without jurisdiction and that their judgment and sentence is vacated. That is preposterous. ¶10 Plaintiffs try to persuade this Court that they are not seeking to have their convictions and sentences vacated; rather, they are seeking a refund of monies paid pursuant to judgments that are void ab initio. Regardless of how creatively Plaintiffs plead their case, this civil suit is nothing more than an impermissible collateral attack on a criminal conviction and sentence.4 The United States Supreme Court has warned against using civil suits as vehicles to challenge the validity of criminal judgments and sentences. In Heck v. Humphrey, 512 U.S. 477 (1994), the United States Supreme Court examined this issue in the context of a § 1983 claim: We hold that, in order to recover damages for allegedly unconstitutional conviction or imprisonment, or for other harm caused by actions whose unlawfulness would render a conviction or sentence invalid, a § 1983 plaintiff must prove that the conviction or sentence has been reversed on direct appeal, expunged by executive order, declared invalid by a state tribunal authorized to make such determination, or called into question by a federal court's issuance of a writ of habeas corpus, 28 U.S.C. § 2254. A claim for damages bearing that relationship to a conviction or sentence that has not been so invalidated is not cognizable under § 1983. Thus, when a state prisoner seeks damages in a § 1983 suit, the district court must consider whether a judgment in favor of the plaintiff would necessarily imply the invalidity of his conviction or sentence; if it would, the complaint must be dismissed unless the plaintiff can demonstrate that the conviction or sentence has already been invalidated. But if the district court determines that the plaintiff's action, even if successful, will not demonstrate the invalidity of any outstanding criminal judgment against the plaintiff, the action should be allowed to proceed, in the absence of some other bar to the suit. Id. 486-87 (footnotes omitted) (emphasis original). ¶11 Here, Plaintiffs' claims for money had and received are premised on the belief their state and municipal court convictions and sentences are void. Like the § 1983 claim in Heck, Plaintiffs must prove their convictions and sentences have been overturned to recover on their claim for money had and received. Plaintiffs' claims clearly bear a relationship to their convictions and sentences. The assertions made by Plaintiffs in their petition, their briefs responding to the State and Municipalities' motions to dismiss, and at the hearing indicate their convictions have not been vacated. A judgment in favor of the Plaintiffs for money had and received would necessarily imply the invalidity of their convictions and sentences. As a result, Plaintiffs' claims for money had and received are not cognizable as a matter of law. ¶12 An action for money had and received arises when one has received money which in equity and good conscience should be paid to another. See Sholer v. State ex rel. Dep't of Pub. Safety, 1995 OK 150, ¶ 29, 945 P.2d 469, 475. Long ago, this Court said of such a cause of action: It is a well-settled principle of law that, if a party through mistake receives money to which he is not justly and legally entitled, and which he should not in good conscience retain, that the law regards him as a receiver and holder of the money for the use of the lawful owner, and raises an implied promise on his part to pay the same, and, on his failure to do so, the owner may maintain an action against him therefor. Avery v. Abraham, 1926 OK 114, ¶ 6, 243 P. 728, 728-29. Plaintiffs have not pleaded facts sufficient to support a cause of action for money had and received. Because Plaintiffs' convictions and sentences have not been invalidated, they cannot demonstrate that the money received by the State and Municipalities in equity and good conscience should be paid to them.5 Plaintiffs can prove no set of facts which would entitle them to relief. Thus, Plaintiffs have failed to state a claim for money had and received and their claims must be dismissed pursuant to 12 O.S.2011 2012(B)(6). The trial court concluded the claims should be dismissed because of lack of venue, lack of subject matter jurisdiction, and § 14 of the Curtis Act, not because Plaintiffs failed to state a claim upon which relief may be granted. However, only one legally correct basis for dismissal is needed for the appellate court to affirm an order granting a motion to dismiss. See Farley v. City of Claremore, 2020 OK 30, ¶ 19, 465 P.3d 1213, 1225. A legally correct decision of the trial court must be affirmed even if "it was anchored to a theory different from that on which it comes to be tested on appellate review." Id. (quoting Myers v. Lashley, 2002 OK 14, ¶ 7, 44 P.3d 553, 557). ¶13 Because we hold Plaintiffs have failed to state a claim upon which relief may be granted, we need not address Plaintiffs' other allegations of error.6 ¶14 We also affirm the part of the order denying Plaintiffs' request for leave to amend their petition.7 To cure the pleading defects, Plaintiffs would need to allege that their criminal convictions and sentences have been overturned.8 After this lawsuit was filed, the Court of Criminal Appeals determined that, for purposes of criminal law, McGirt does not apply retroactively to void a conviction that was already final when the case was decided on July 9, 2020. See State ex rel. Matloff v. Wallace, 2021 OK CR 21, ¶ 15, 497 P.3d 686, 689, cert. denied, 142 S. Ct. 757 (Jan. 10, 2022). Plaintiffs filed this civil action for money had and received four days after McGirt was decided. As discussed above, the record on appeal indicates Plaintiffs' convictions became final prior to the McGirt decision and have not since been vacated. Therefore, we hold the trial court did not abuse its discretion by denying Plaintiffs' request to amend their petition. Any amendment would be futile. CONCLUSION ¶15 Plaintiffs' claims for money had and received require a determination that their state and municipal court criminal convictions and sentences are invalid. Challenges to criminal jurisdiction are governed by the Post-Conviction Procedure Act, 22 O.S. §§ 1080-1089. Plaintiffs' convictions and sentences cannot be invalidated by the trial court in this civil action for money had and received. As a result, Plaintiffs have failed to state a claim upon which relief may be granted. We affirm the trial court's dismissal of the claims. ORDER OF THE DISTRICT COURT IS AFFIRMED. CONCUR: Darby, C.J., Kane, V.C.J., Winchester, Edmondson, Combs, Gurich, Rowe, and Kuehn, JJ. CONCUR IN RESULT: Kauger, J. FOOTNOTES 1 In their petition, Plaintiffs make allegations against Chris Ross, District Attorney for Seminole County, but Ross was not named as a Defendant in the case caption. Defendants The City of Boynton and The Town of Oktaha were dismissed without prejudice. Defendant The Town of Summit is not a party to this appeal. 2 "A judgment is void on its face if the trial court lacked either jurisdiction over the parties, jurisdiction over the subject matter, or jurisdictional power to render the particular judgment." In re Estate of Mouse, 1993 OK 157, ¶ 7, 864 P.2d 1284, 1286; see Application of Russell, 1960 OK CR 61, ¶ 6, 354 P.2d 485, 487. 3 See, e.g., Bosse v. State, 2021 OK CR 30, ¶ 3, 499 P.3d 771, 773 (arguing in his application for post-conviction relief that "[b]ecause jurisdiction for Indian Country crimes rests exclusively in federal court, Oklahoma lacked jurisdiction to prosecute Mr. Bosse, and his convictions are void ab initio . . . ."); Martinez v. State, 2021 OK CR 40, ¶ 3, 502 P.3d 1115, 1117 (arguing in his application for post-conviction relief that "[b]ecause the State of Oklahoma lacked jurisdiction, Mr. Martinez's convictions in the District Court of Comanche County are void ab initio and should be vacated and the charges dismissed."). 4 This Court has rejected similar attempts to use an extraordinary writ or declaratory judgment action to challenge a criminal judgment and sentence. See, e.g., Dutton v. Midwest City, 2015 OK 51, ¶ 21, 353 P.3d 532, 541-42 (extraordinary writ); Okla. State Senate ex rel. Roberts v. Hetherington, 1994 OK 16, ¶ 1, 868 P.2d 708, 709 (declaratory judgment). 5 Furthermore, Plaintiffs have not alleged that after successfully obtaining post-conviction relief, the fines, costs, assessments, probationary fees, and other monies paid as a result of their convictions and sentences were not returned to them nor have they alleged that the State and Municipalities are the receivers and holders of the funds. 6 We offer no opinion as to whether § 14 of the Curtis Act of 1898, 30 Stat. 499-500, gives municipalities criminal jurisdiction over Indians for crimes committed in Indian country. 7 "On granting a motion to dismiss a claim for relief, the court shall grant leave to amend if the defect can be remedied and shall specify the time within which an amended pleading shall be filed." 12 O.S.2011 § 2012(G). 8 See supra note 5.

82ef3322-2fdd-464e-9b0d-8745e2af2769

In the Matter of the Adoption of S.A.H.

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ADOPTION OF S.A.H.2022 OK 10Case Number: 118986; Comp. w/119218Decided: 02/01/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL.     IN THE MATTER OF THE ADOPTION OF: S.A.H., Minor Child. IN THE MATTER OF THE GUARDIANSHIP OF: S.A.H., Minor Child. NO. 118,986 ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY Honorable Kurt Glassco, Trial Judge NO. 119,218 ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY Honorable James Keeley, Trial Judge Thomas H. Landrum, The Firm on Baltimore, PLLC, Tulsa, Oklahoma, for Appellant. Catherine Z. Welsh and Jim C. McGough, Welsh & McGough, PLLC, Tulsa, Oklahoma, for Appellees. ¶0 Minor child's cousin appealed two district court decisions that (1) denied the cousin's motion to vacate an adoption of the minor child to her paternal grandparents and (2) dismissed the cousin's claim for guardianship due to the adoption. This Court retained the appeals. We affirm the district courts' decisions. The cousin had no statutory or constitutional rights to custody of the minor child to warrant vacating an adoption consented to by the minor child's father. NO. 118,986 - DISTRICT COURT'S JUDGMENT AFFIRMED. NO. 119,218 - DISTRICT COURT'S JUDGMENT AFFIRMED. Winchester, J. ¶1 Today, we dispose of two related cases involving minor child S.A.H. by a single opinion. In Case No. 118,986, Appellant S.A.H.'s maternal first cousin (Cousin) appealed the district court's denial of her motion to vacate an order finalizing the adoption of the minor child to Appellees, S.A.H.'s paternal grandparents (Grandparents).1 In Case No 119,218, Cousin appealed the dismissal of her petition for general guardianship based on Grandparents' adoption of S.A.H. We retained both appeals. ¶2 The issues before this Court are (1) whether the adoption court erred in granting the adoption of the minor child to Grandparents based on the consent of S.A.H.'s father (Father) while Cousin had a claim for general guardianship pending, and (2) whether the guardianship court erred in dismissing Cousin's petition for guardianship due to the adoption. We answer both in the negative. Cousin holds no constitutional or statutory right to unwind Grandparents' adoption to which Father consented. Due to Grandparents' adoption of the minor child, a guardianship is not necessary. FACTS AND PROCEDURAL HISTORY ¶3 S.A.H. was born out-of-wedlock on February 3, 2009. S.A.H.'s mother (Mother) had sole legal custody of S.A.H. until Mother could no longer care for the minor child due to a terminal illness. On May 2, 2019, Cousin petitioned to be S.A.H.'s temporary and general guardian in Tulsa County District Court, Case No. PG-2019-293 (Guardianship Matter). Cousin's basis for her request for the guardianship was that Mother had a terminal illness and S.A.H.'s father had not acknowledged paternity, had not obtained a court determination of paternity, and had not supported the minor child financially or otherwise. The district court appointed Cousin as the temporary guardian of the minor child. On May 4, 2019, Mother passed away. ¶4 On July 31, 2019, S.A.H.'s father (Father) petitioned for determination of paternity and custody of the minor child in Tulsa County District Court, Case No. FP-2019-230 (Paternity Matter). Father established his paternity through genetic testing. ¶5 On October 1, 2019, Father filed his notice of paternity adjudication and motion to dismiss the temporary guardianship in the Guardianship Matter. On October 16, 2019, the guardianship court held a show-cause hearing. The guardianship court found insufficient evidence to continue the guardianship and terminated Cousin's temporary guardianship. At Cousin's request, the guardianship court set a trial for her petition for general guardianship on January 22, 2020. ¶6 On October 17, 2019, Grandparents petitioned to adopt S.A.H. in Tulsa County District Court, Case No. FA-2019-357 (Adoption Matter). On November 1, 2019, Father petitioned the paternity court for custody of S.A.H. due to his established paternity, and the court granted Father sole legal and physical custody of the minor child. Father then provided his consent to Grandparents' adoption of the minor child in the Adoption Matter. On January 31, 2020, the adoption court held a best-interests hearing and issued the final decree of adoption to Grandparents. ¶7 In the Guardianship Matter, Cousin requested a continuance for the trial on her petition for general guardianship of the minor child. In February 2020, Cousin filed multiple motions in preparation for the trial, which prompted Grandparents to file a motion to dismiss the Guardianship Matter due to the adoption. On March 13, 2020, the guardianship court struck the hearing on Cousin's motions as moot due to the finalized adoption. ¶8 Almost two months after the guardianship court struck the hearing on Cousin's motions, Cousin filed a motion to vacate Grandparents' adoption in the Adoption Matter. The adoption court held a hearing and denied Cousin's motion to vacate, reasoning that Cousin did not demonstrate a basis under 12 O.S.2011, § 10312 to vacate the adoption. ¶9 On October 19, 2020, the guardianship court held a hearing and granted Grandparents' motion to dismiss the Guardianship Matter. The guardianship court concluded that Cousin's request for guardianship was moot due to the finalized adoption. ¶10 Cousin appealed the denial of her motion to vacate the final adoption decree in the Adoption Matter.3 Cousin also appealed the granting of Grandparents' motion to dismiss in the Guardianship Matter. We retained both appeals, and this opinion addresses both district courts' rulings. STANDARD OF REVIEW ¶11 The Court reviews the appointment or termination of a guardian for an abuse of discretion. Bank of Okla., N.A. v. Red Arrow Marina Sales & Serv., Inc., 2009 OK 77, ¶ 11, 224 P.3d 685, 693; Smith v. City of Stillwater, 2014 OK 42, ¶ 11, 328 P.3d 1192, 1197; Brigmam v. Cheney, 1910 OK 316, ¶ 5, 112 P. 993, 994. We will not reverse unless the guardianship court's determination is against the clear weight of the evidence or contrary to law. In re Guardianship of Holly, 2007 OK 53, ¶ 19, 164 P.3d 137, 143. As Cousin appeals an order granting a motion to dismiss, we examine the issues of the dismissal of the Guardianship Matter de novo, since an appellate court has plenary, independent, and non-deferential authority to reexamine a trial court's legal rulings. Id. ¶12 The standard of review for the denial of Cousin's motion to vacate Grandparents' adoption of the minor child is also an abuse of discretion. Smith, 2014 OK 42, ¶ 11, 328 P.3d at 1197; Bank of Okla., N.A., 2009 OK 77, ¶ 11, 224 P.3d at 693; In re Adoption of C.D.M., 2001 OK 103, ¶ 23, 39 P.3d 802, 811. Applying these standards of review to the present case, Cousin fails to affirmatively show the district courts' decisions were an abuse of discretion, against the clear weight of the evidence, or contrary to law. DISCUSSION I. THE GUARDIANSHIP COURT AND ADOPTION COURT PROPERLY CONSIDERED THE BEST INTERESTS OF THE MINOR CHILD. ¶13 As a preliminary matter, Cousin focuses her arguments on appeal to an overarching issue: the district courts abused their discretion in not considering the best interests of the minor child when the courts terminated the temporary guardianship, granted the adoption to Grandparents, and dismissed the Guardianship Matter. Essentially, Cousin contends she could better care for the minor child than Father or Grandparents. We find this argument without merit. ¶14 Under Oklahoma law, the presumption is a minor child's best interest "is served by placement with its natural parent in the absence of clear and convincing evidence establishing that the parent is unfit." In re Guardianship of M.R.S., 1998 OK 38, ¶ 14, 960 P.2d 357, 361. Another family member or a third party seeking custody must affirmatively, not comparatively, show the natural parent is unfit. Ingles v. Hodges, 1977 OK 18, ¶ 9, 562 P.2d 845, 846 (holding even the children's preference was not sufficient to justify taking them from their father when there was no evidence of the father's unfitness). A court will not deprive natural parents of custody simply because another family might be able to provide more amenities and opportunities for the child. In re Guardianship of M.R.S., 1998 OK 38, ¶ 21, 960 P.2d at 363 (holding the district court erred when it determined that the interest of the child outweighed any "rights" of the natural parent to her custody and control). ¶15 Cousin construes her request for a guardianship to be akin to a proceeding for termination of parental rights to obtain permanent custody of the minor child; it is not. The guardianship court could terminate Cousin's temporary guardianship of the minor child when it was no longer necessary--when the impediment to the natural parent's custody was removed, unless to do so would have been harmful to the welfare of the child. 30 O.S.2011, § 4-804; In re Guardianship of Hatfield, 1972 OK 10, ¶ 8, 493 P.2d 819, 821; see also Grose v. Romero, 1948 OK 120, 193 P.2d 1014. Cousin obtained a temporary guardianship, lasting only five months until Father established that he was the biological father of the minor. Once he did, the guardianship court held a hearing and dismissed the temporary guardianship because it was no longer necessary. The district court did not abuse its discretion in terminating the temporary guardianship as, under Oklahoma law, Father carried the presumption of the best-interest placement and the record is absent of evidence of Father's unfitness. Without a showing of harm to the child's welfare, it was in the minor child's best interest for the district court to place the child with her Father once he established paternity. ¶16 The paternity court then granted Father full custody of the child, and Father had the constitutional right to make decisions regarding the welfare of his child. In re Adoption of D.T.H., 1980 OK 119, ¶ 18, 615 P.2d 287, 290 (overruled on other grounds). Parents' constitutional rights include making decisions about their child's custody and upbringing, and a third party may not infringe upon those rights unless there is a finding of harm to the child or of the parent's unfitness. In re Herbst, 1998 OK 100, ¶ 10, 971 P.2d 395, 397; McDonald v. Wrigley, 1994 OK 25, ¶ 4, 870 P.2d 777, 779 (noting that a district court may award custody to a third party if it finds both parents unfit); Davis v. Davis, 1985 OK 85, ¶ 13, 708 P.2d 1102, 1108. There is a presumption that parents act in their child's best interests. Eldredge v. Taylor, 2014 OK 92, ¶ 19, 339 P.3d 888, 894 (citations omitted). ¶17 The record established that Father believed it was in the best interests of S.A.H. for Grandparents to adopt and care for her because they could provide a more stable home for the minor child due to Father's work schedule. Grandparents are retired and have the flexibility to meet the needs of the minor child when demands arise. Father and Grandparents had been a part of the minor child's life since she was born, and Father had the opportunity to continue to be a part of the minor's life after the adoption. Grandparents had experience caring for children in raising their own adopted children and in teaching students throughout their careers in education. Grandparents also demonstrated a desire to facilitate a relationship between the minor child and Mother's extended family. Upon review, there is nothing within the record that shows requisite harm to the minor or unfitness to prevent Father's decision to consent to Grandparents' adoption. See e.g., In re Herbst, 1998 OK 100, ¶ 16, 971 P.2d at 399. Instead, the presumption under Oklahoma law is and, the record demonstrates, that Father was acting in the minor child's best interests. The adoption court therefore did not abuse its discretion in granting Grandparents' adoption petition of the minor child. II. THE ADOPTION COURT COULD PROCEED WITH GRANDPARENTS' PETITION FOR ADOPTION WHILE THE GUARDIANSHIP REQUEST WAS PENDING. ¶18 Cousin contends that it was improper for the adoption court to proceed with the Adoption Matter while the Guardianship Matter was pending. She further argues that Grandparents aggravated the situation by not fully disclosing in their adoption petition that Cousin had a claim for general guardianship still pending. We disagree; the adoption court correctly proceeded with the minor child's adoption. ¶19 The guardianship court had jurisdiction to order and administer the Guardianship Matter and retained that jurisdiction over the guardianship "until termination of the proceeding." 30 O.S.2011, § 1-113(B). The guardianship court terminated the temporary guardianship when it was no longer necessary. 30 O.S.2011, § 4-804; see also In re Guardianship of Hatfield, 1972 OK 10, ¶ 8, 492 P.2d at 821; see also Grose, 1948 OK 120, 193 P.2d 1014. Cousin requested a trial for a general guardianship. However, the paternity court granted full custody of the minor child to Father. The guardianship court should have dismissed the entire guardianship as moot at the time the paternity court awarded Father full custody of the minor child as a guardianship was no longer necessary. See In re Adoption of R.W.S., 1997 OK 148, ¶ 24, 951 P.2d 83, 88 (holding a guardianship was moot since the court awarded custody of the minor child to the natural mother). Upon dismissal, the guardianship court's jurisdiction would have concluded at that time. ¶20 Even with the district court allowing Cousin's general guardianship claim to survive, we hold that the Guardianship Matter and the Adoption Matter were separate proceedings requesting different relief. Oklahoma law allows some related actions to proceed simultaneously--just as the Paternity Matter and Guardianship Matter proceeded simultaneously in this case. See, e.g., Steltzlen v. Fritz, 2006 OK 20, 134 P.3d 141; see also, e.g., 10 O.S.2011, § 7503-302(A) (a paternity action may be filed when notice of an adoption is given). Our Court allows two matters to proceed simultaneously when full, complete, and adequate relief cannot be obtained in the first court and an intolerable conflict of jurisdiction does not exist. State v. Lohah, 1967 OK 165, ¶¶ 6-7, 30, 434 P.2d 928, 930, 934. Father, who had full legal custody of the minor child, consented to Grandparents' adoption of the minor child. Cousin had no legal right to object to the adoption as she had no current guardianship or right to custody of the minor child. See Birtciel v. Jones, 2016 OK 103, ¶ 12, 382 P.3d 1041, 1044 (holding a grandmother had no standing in a minor's adoption because consent was only necessary from the minor's father). Grandparents could not obtain full, complete, and adequate relief in the Guardianship Matter concerning their adoption of the minor child, and an intolerable conflict between the proceedings did not exist. ¶21 Cousin relies on multiple cases to support her contention that it was improper for the adoption court to proceed with the Adoption Matter while the Guardianship Matter was pending. These cases involved either divorce actions or third parties' efforts to obtain a guardianship or adoption of a minor child.4 Those appellate decisions decided the procedural and jurisdictional issues based on the specific facts in each case. However, none involved a natural parent with full custody of a minor child consenting to an adoption. We have recognized the importance of the right to consent to an adoption as an important right in and of itself. Steltzlen, 2006 OK 20, ¶ 12, 134 P.3d at 144. Because of that right, we recognize a preference of Father's consent for Grandparents to adopt the minor child over another family member's request for guardianship--where that family member has no current guardianship or rights to custody of the minor child. Therefore, under the facts of this case, the adoption court could proceed with the Adoption Matter even though a claim for general guardianship was pending. ¶22 We acknowledge that Grandparents stated in their adoption petition that the guardianship court dismissed the Guardianship Matter without clarifying that Cousin had a claim for general guardianship pending. However, Grandparents' petition provided the case number for the Guardianship Matter. The adoption court should have confirmed the status of the Guardianship Matter and consolidated the matter or deferred to the guardianship court if it thought necessary. However, we do not believe Grandparents' actions warrant the unwinding of the adoption of the minor child to which Father consented. III. GRANDPARENTS WERE NOT REQUIRED TO GIVE COUSIN NOTICE OF THE ADOPTION. ¶23 Cousin contends Grandparents violated her due process rights when they did not give her notice of their pending adoption of the minor child. We again disagree. ¶24 Cousin had no right--by statute or constitution--to notice of Grandparents' adoption. In Birtciel, a grandmother sought visitation of her minor grandchild pursuant to her rights under Oklahoma statutes. 2016 OK 103, 382 P.3d 1041. Four months later, the minor's stepmother petitioned another district court to adopt the child. The adoption court granted the adoption of the minor child to the stepmother while the grandmother's petition for visitation was still pending. The district court then dismissed the grandmother's petition for visitation due to the adoption. The grandmother appealed. Id. ¶¶ 3-6, 382 P.3d at 1042-43. In determining whether the grandmother had standing in the adoption matter, the Court ruled that the grandmother's standing only extended to purposes of resolving her visitation rights, not to the resolution of the adoption. It held consent to the adoption was necessary only from the child's father and grandmother could not have appeared to object at the adoption. The Court further concluded that without the need for her consent, the grandmother was not entitled to notice. Id. ¶ 12, 382 P.3d at 1044. ¶25 Similarly, Cousin's standing in this case did not extend to the resolution of Grandparents' adoption as consent to the adoption was necessary only from Father. Cousin could not appear to object to the adoption. Grandparents therefore followed the notice requirements under the Oklahoma adoption statutes, which we strictly construe. Oklahoma adoption procedure is "wholly within the control of the legislature," and the Court cannot broaden the requirements to obtain an adoption beyond that set by the Legislature. Head v. McCracken, 2004 OK 84, ¶ 13, 102 P.3d 670, 680; In re Adoption of G.D.L., 1987 OK 115, ¶ 13, 747 P.2d 282, 285. Under Oklahoma law, Cousin was not entitled to notice of the adoption proceedings. ¶26 We note the basis for granting relief to the grandmother in Birtciel was the Court's desire not to penalize the grandmother when Oklahoma statutes governed her visitation rights and as required by the statutes, she filed her request for visitation prior to the adoption matter. 2016 OK 103, ¶ 15, 382 P.3d at 1045. Cousin was not penalized in this case because she does not have any statutory rights to custody or visitation. See, e.g., K.R. v. B.M.H., 1999 OK 40, ¶ 17, 982 P.2d 521, 524 (denying an aunt visitation because she had no constitutional right to visit her minor niece, nor did she have any statutory visitation rights under Oklahoma law). CONCLUSION ¶27 Cousin requests an equitable remedy in this matter--for the Court to give her custody rights that do not exist under Oklahoma law. Equity is subject to the United States and Oklahoma constitutions and may not exceed the protections and privacy therein assured to families. Allowing Cousin to object and unwind an adoption that Father consented to would violate his constitutional right to make decisions regarding his child. Without the requisite harm or unfitness, Cousin's interest does not rise to a level so compelling as to warrant intrusion upon the fundamental right of a parent, including the right to consent to adoption. We refuse to extend equity to provide Cousin a remedy in this case. For these reasons, we affirm the adoption court's denial of Cousin's motion to vacate Grandparents' adoption and the guardianship court's dismissal of Cousin's request for guardianship due to the adoption. NO. 118,986 - DISTRICT COURT'S JUDGMENT AFFIRMED. NO. 119,218 - DISTRICT COURT'S JUDGMENT AFFIRMED. CONCUR: Darby, C.J., Kane, V.C.J., Kauger, Winchester, Edmondson, Combs and Rowe, JJ. CONCUR IN RESULT: Gurich and Kuehn, JJ. FOOTNOTES 1 Oklahoma Supreme Court Rule 1.25, 12 O.S. Supp. 2013, app. 1 provides in pertinent part: (b) ... In appeals from juvenile proceedings including, but not limited to, adoption and paternity proceedings and proceedings under the juvenile code, the initial of the child's name shall be used rather than the child's name. Referring to Appellant as "Cousin" and to Appellees as "Grandparents" in this opinion is done in the same spirit of protecting the privacy of the child as that expressed in Oklahoma Supreme Court Rule 1.25. 2 A district court's power to vacate or modify its judgments is as follows: The district court shall have power to vacate or modify its own judgments or orders within the times prescribed hereafter: 1. By granting a new trial for the cause, within the time and in the manner prescribed in Sections 651 through 655 of this title; 2. As authorized in subsection C of Section 2004 of this title where the defendant had no actual notice of the pendency of the action at the time of the filing of the judgment or order; 3. For mistake, neglect, or omission of the clerk or irregularity in obtaining a judgment or order; 4. For fraud, practiced by the successful party, in obtaining a judgment or order; 5. For erroneous proceedings against an infant, or a person of unsound mind, where the condition of such defendant does not appear in the record, nor the error in the proceedings; 6. For the death of one of the parties before the judgment in the action; 7. For unavoidable casualty or misfortune, preventing the party from prosecuting or defending; 8. For errors in a judgment, shown by an infant in twelve (12) months after arriving at full age, as prescribed in Section 700 of this title; or 9. For taking judgments upon warrants of attorney for more than was due to the plaintiff, when the defendant was not summoned or otherwise legally notified of the time and place of taking such judgment. 12 O.S.2011, § 1031. 3 Grandparents argue that Cousin filed her motion to vacate the adoption more than 30 days after the district court entered the final decree of adoption. Grandparents contend Cousin must therefore prove the decree was void. We disagree in that Cousin had no notice of the final decree of adoption until after the 30 days expired. 4 In re Adoption of B.K.J., 1982 OK 143, ¶ 20, 639 P.2d 611, 614; Lohah, 1967 OK 165, ¶ 29, 434 P.2d at 934; see also In re Adoption of A.D.H., 2000 OK CIV APP 134, ¶ 11, 15 P.3d 519, 521.

8a76e9bd-f5d0-4f81-acfe-09b33ee08df6

Progressive Direct Ins. Co. v. Pope

oklahoma

Oklahoma Supreme Court

PROGRESSIVE DIRECT INSURANCE CO. v. POPE2022 OK 4Case Number: 119309Decided: 01/11/2022THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. PROGRESSIVE DIRECT INSURANCE COMPANY, Plaintiff/Appellee,v.IKIA POPE, Defendant/Appellee,andBRANDI POWELL, Defendant/Appellant,v.IKIA POPE, Cross Claim Defendant/Appellee. APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY ¶0 Insurer sought a declaratory judgment in the District Court of Tulsa County for the purpose of adjudicating whether its insurance policy excluded treble damages pursuant to 47 O.S.2011, § 10-103. Insurer filed a motion for summary judgment, and the Honorable J. Doug Drummond, District Judge, concluded the treble damages provided by 47 O.S. 2011, § 10-103 were punitive in nature, and the damages were excluded by a clause excluding punitive damages. Injured motorist appealed the subsequent consent judgment which was based, in part, upon the trial court's adjudication of the treble damages issue. The Supreme Court retained the appeal sua sponte. We hold: Statutory treble damages in 47 O.S.2011, § 10-103 are punitive in nature and punitive damages were expressly excluded by the policy. DISTRICT COURT JUDGMENT AFFIRMED Donald E. Smolen, II, Smolen Law, PLLC, Tulsa, Oklahoma, for Defendant/Cross-Claim Plaintiff/Appellant. Brad L. Roberson and Dawn M. Goeres, Roberson, Kolker, Cooper & Goeres, PC, Edmond, Oklahoma, for Plaintiff/Appellee. Brian L. Carter, Latham, Steele, Lehman, Keele, Ratliff, Frieje & Carter, Tulsa, Oklahoma, for Defendant/Appellee. EDMONDSON, J.: ¶1 The controversy in the District Court centered on whether the insurer's policy excluded statutory treble damages pursuant to 47 O.S.2011, § 10-103 because of an exclusionary clause for punitive damages in the policy. The trial court stated the treble damages were punitive in nature and excluded by the policy. We agree, and affirm the District Court. I. The Controversy ¶2 Ikia Pope and Brandi Powell were in a motor vehicle collision. Pope left the scene of the collision. Powell alleged Pope drove a vehicle owned by third parties who gave permission for Pope to drive the vehicle. Progressive Direct Insurance Company insured the vehicle driven by Pope. ¶3 Powell made bodily injury and property damage claims with Progressive Direct Insurance Company (insurer). Powell asserted she was entitled to treble property damages pursuant to a statute which states as follows. The driver of any vehicle involved in an accident resulting only in damage to a vehicle which is driven or attended by any person shall immediately stop such vehicle at the scene of such accident or as close thereto as possible but shall forthwith return to and in every event shall remain at the scene of such accident until he has fulfilled the requirements of Section 10-104 of this title. Every such stop shall be made without obstructing traffic more than is necessary. Any person failing to stop or comply with said requirements under such circumstances shall be guilty of a misdemeanor and upon conviction thereof shall be punished by a fine not to exceed Five Hundred Dollars ($500.00) or by imprisonment in the county jail for not more than one (1) year, or by both such fine and imprisonment. In addition to the criminal penalties imposed by this section, any person violating the provisions of this section shall be subject to liability for damages in an amount equal to three times the value of the damage caused by the accident. Said damages shall be recoverable in a civil action. Nothing in this section shall prevent a judge from ordering restitution for any damage caused by a driver involved in an accident provided for in this section. 47 O.S.2011, § 10-103 (emphasis added). Powell relied upon the language stating "any person violating the provisions of this section shall be subject to liability for damages in an amount equal to three times the value of the damage caused by the accident." The parties indicate Pope "pled no contest to criminal misdemeanor charges . . . including a violation of 47 O.S. § 10-103." ¶4 Progressive Direct Insurance Company (insurer) filed a District Court petition for a declaratory judgment, and alleged treble damages pursuant to 47 O.S.2011, § 10-103, did not apply to its insurance policy. Powell filed an answer, cross-claim against Pope, and a third-party petition against third-parties who were the alleged owners of the vehicle Pope was driving. ¶5 Insurer filed a motion for summary judgment for an adjudication whether the insurance policy required indemnification for treble damages pursuant to 47 O.S.2011, § 10-103. Powell filed an objection to insurer's motion. Powell disagreed with insurer's interpretations of the insurance policy and 47 O.S. § 10-103, as well as the insurer's factual valuation of damage to Powell's vehicle. Insurer filed a reply supporting its motion for a summary judgment. ¶6 The trial court stated the issue for adjudication was whether public policy required statutory treble damages to be excluded from the policy's coverage. The trial court concluded the treble damages in 47 O.S. § 10-103 "is more aligned with the definition of punitive damages than it is with non-punitive or compensatory [damages]." The trial court concluded a punitive purpose in statutory language would be frustrated by allowing a driver to shift the statutory economic burden to an insurer. The trial court determined the policy did not include coverage for the statutory treble damages, and granted a part of the insurer's motion for a summary adjudication. ¶7 Insurer's Petition for declaratory judgment raised the statutory treble damages issue, sought a declaratory judgment, and requested "This Court determine and adjudicate the rights and liabilities of the parties with respect to the subject contract of insurance." Powell responded and filed an answer, cross-claim, and third-party petition on her behalf and as mother and next friend of her minor child who had been a passenger in her mother's vehicle at the time of the collision. Powell asserted property damages and injuries to her person and the person of her minor child as a result of the collision. Powell sought attorney's fees. ¶8 Insurer's motion for summary judgment also sought an adjudication whether Powell was entitled to attorney's fees: "As such, in addition to seeking a judicial determination on the issue of whether the Policy is required to indemnify any treble damages Powell may recover pursuant to 47 O.S. § 10-103, Progressive also seeks a judicial determination as to whether the Policy is required to indemnify any award of attorney fees for Powell."1 The trial court's "Order" adjudicating insurer's motion was filed in the trial court on April 15, 2020, and states: "The Plaintiff's Motion for Summary Judgment is sustained as to the treble damages issue." The trial court also stated: "As to the attorney fee issue, the Court will reserve any decision on the matter until (or if) an application for attorney fees is submitted." ¶9 We have explained "[t]he disposal of a segment of a cause of action is not a judgment but an interlocutory summary adjudication, a limitation on the issues to be tried."2 Of course, a partial summary adjudication which is lacking finality and appealability as a non-appealable interlocutory order "is but an intermediate order in the case," remains within the trial judge's complete control to modify or alter at any time before judgment," and a motion to reconsider or otherwise challenging that intermediate order "is to be treated as a request for reconsideration of an intermediate ruling in the case.3 A trial court's partial summary adjudication on an issue of law related to a cause of action and occurring anterior to judgment is not usually immediately appealable, but the interlocutory decision may thereafter be reviewed when a judgment is appealed.4 The parties did not request a review of the interlocutory order in the trial court. ¶10 The parties and trial court did not treat the trial court's April 15th order as a summary judgment adjudication after the trial court's decision; i.e., they did not treat the order as a final determination on the merits of the controversy.5 A Journal Entry of Consent Judgment was filed several months later on December 10, 2020. The parties treated the order of April 15, 2020, as an uncertified partial summary adjudication,6 which was appealable after the consent judgment was filed. ¶11 The settlement agreement referenced in the consent judgment stated an amount of $2,558.74 was paid for Powell's property damage claim pursuant to the parties' agreement.7 Generally, a party who voluntarily accepts the benefits from a judgment cannot question the validity of the judgment in an appeal.8 One of the exceptions to this rule may occur when "it is only possible to receive a more favorable judgment, but not a less favorable one."9 Powell's appeal does not create the possibility of a less favorable judgment for Powell. ¶12 Additionally, the claim for statutory treble damages was specifically reserved in the consent judgment as a court-adjudicated and non-consensual property damage claim, and the treble damages claim has been construed by the parties as a property damage claim completely separate from the $2,558.64 property claim. Further, we note the consent judgment states "all parties to bear their own fees and costs," and the issue of attorney fees raised during the partial summary adjudication appears to have been resolved by the consent judgment. There appear to be no claims pending in the District Court controversy and no jurisdictional impediment to our review of the single issue before us involving a right to 47 O.S.2011, § 10-103 treble damages. ¶13 The consent judgment stated Powell had a right to appeal the order entered on April 15, 2020, with the right to appeal that order commencing after the consent judgment was filed. This appeal is not one from the April 15th interlocutory order. Powell appealed the consent judgment for the purpose of challenging the anterior interlocutory summary order adjudicating a right to 47 O.S. § 10-103 treble damages.10 Appellate jurisdiction is based upon a timely appeal from the judgment in the controversy. An accelerated appellate procedure is provided by Oklahoma Supreme Court Rule 1.36 for appeals from (1) a District Court Rule 13 order granting summary judgment, and (2) final orders in cases in which motions to dismiss for failure to state a claim or lack of jurisdiction (of a person or subject matter) under District Court Rule 4 were filed after October 1, 1993.11 Powell properly filed a petition in error seeking appellate review outside the scope of Okla. Sup. Ct. Rule 1.36 summary judgment appeal. ¶14 When an order granting summary judgment is appealed the trial court filings serve as the appellate briefs.12 Insurer attempted to litigate the issue before us by using a motion for summary judgment in the trial court. The trial court's order did not grant the requested summary judgment, but instead granted a partial summary adjudication anterior to judgment. Our review of an interlocutory partial summary adjudication upon appeal of the subsequent judgment is similar to our review of a motion for summary judgment, and we examine the trial court submissions actually used by the parties and the trial court to adjudicate the motion.13 ¶15 Powell filed a designation of record in this Court consistent with an appeal not governed by Rule 1.36. However, due to issues related to judicial economy, the parties treating the trial court motion as one for summary judgment, and the specific issue presented, the Court exercised an Okla. Const. Art. 7 § 4 discretion controlling the form of an appellate record, and directed the parties to file a Rule 1.36 appellate record and prosecute the appeal pursuant to that Rule.14 The Court also retained the appeal sua sponte to decide the sole issue involving statutory treble damages.15 ¶16 Powell appealed and raised three formal assignments of error, two of which are: (1) Whether the trial court erred in holding that treble damages pursuant to 47 O.S. § 10-103 are necessarily punitive in nature; and (2) Whether the trial court erred in holding that public policy requires excluding treble damages pursuant to 47 O.S. § 10-103 from automobile liability insurance coverage.16 ¶17 Insurer argued: (1) The policy contains no provision for treble damages; (2) The treble damages provided by 47 O.S. § 10-103 are punitive or exemplary in nature and are excluded by the policy; (3) Oklahoma public policy disfavors indemnification of an award based upon treble damages in 47 O.S. § 10-103; (4) A violation of 47 O.S. § 10-103 is not an "accident" and treble damages in 47 O.S. § 10-103 are not a "covered loss" pursuant to the policy; (5) Treble damages awarded pursuant to 47 O.S. §10-103 are not "damages for . . . property damage" and are not a covered loss pursuant to the policy; and (6) Treble damages pursuant to 47 O.S. § 10-103 arise from an intentional act and are "excluded from coverage." ¶18 Powell argued: (1) Statutes providing a judgment for multiple damages, i.e, a judgment for an amount by doubling, trebling, or otherwise multiplying a sum assessed as required by the statute are not per se punitive in nature; (2) The treble damages in 47 O.S.2011, §10-103 are not excluded from coverage by a public policy exclusion for punitive damages; (3) If the public policy exclusion for punitive damages applies generally, it does not apply to third-party defendants' liability; (4) The insurance policy provides for treble damages pursuant to 47 O.S. § 10-103; (5) Treble damages pursuant to 47 O.S. § 10-103 are not excluded by the insurance policy; and (6) The intentional act exclusion does not exclude coverage for treble damages as a matter of law. II. Appellate Review ¶19 The standard for appellate review of a summary judgment adjudicating an issue of law is de novo, and an appellate court engages in an independent and nondeferential review of the summary judgment adjudication.17 A trial court's summary adjudication or partial summary adjudication deciding an issue of law receives a de novo appellate review similar to review of a summary judgment.18 Generally, the meaning, construction, or interpretation of statutory language presents an issue of law.19 A trial court's judgment based upon application of statutory language is reviewed de novo in an appeal from the judgment.20 When the meaning assigned by the trial court to an insurance contract and its terms is based upon a legal conclusion, then the assignment of error on appeal presents a legal question and is reviewed using a de novo standard.21 The meaning, construction, or interpretation of the language in 47 O.S.2011, § 10-103 presents a question of law for our de novo review of the adjudication by the District Court. III. Analysis ¶20 Generally, compensatory damages "are intended to redress the concrete loss that the plaintiff has suffered by reason of the defendant's wrongful conduct;" but "punitive damages serve a broader function; they are aimed at deterrence and retribution."22 Statutorily specified damages are slightly different in that they may be compensatory, punitive, or a mixture of the two depending upon the legislative purpose served by the particular statutory damages. For example, the United States Supreme Court has examined different statutory treble-damages provisions and placed them "on different points along the spectrum between purely compensatory and strictly punitive awards."23 The Court has characterized various statutory treble-damages provisions on this spectrum as "essentially punitive in nature,"24 "a remedial provision,"25 "a remedy for the victims of antitrust violations,"26 capable of possessing a compensatory remedial purpose as well as a punitive objective,27 designed to remedy an economic injury,28 and serving a "remedial function."29 The Court explained distinguishing a remedial payback and punishment defies general formulation because the difference between the two is dependent "on the workings of a particular statute and the course of particular litigation."30 Similarly, our Court has looked to whether the intent and purpose of damages are punitive or to compensate an individual plaintiff.31 We have classified a statute punitive in nature rather than compensatory when the "primary intent of the statute" was to deter a type of behavior.32 ¶21 In McIntosh v. Watkins, 2019 OK 6, 441 P.3d 1094, we explained 47 O.S. §10-103 was amended several years ago to add both a criminal penalty and civil treble damages: "Title 47 O.S. 1961, § 10-103 has only been amended once since its enactment. HB 1458 (1987) amended § 10-103 to add a specific punishment provision, to provide the current scheme for treble damages and to authorize a court to order restitution."33 We then noted the treble damages language was enacted for the purpose of deterrence: "The obvious public policy behind the treble damages provision is to provide an added level of deterrence against hit-and-run drivers who damage attended vehicles."34 According to McIntosh, the Legislature's public policy for imposing a criminal penalty and the treble damages in 47 O.S. § 10-103 were to create a deterrence by imposing punitive measures upon a driver "involved in an accident" who did not fulfill the requirements of 47 O.S. § 10-104 and fled the scene of the accident. ¶22 Powell asserted treble damages may be legislatively created for "any number of non-punitive purposes" which may include "compensating the victim and incentivizing private plaintiffs to enforce their rights." Powell's argument created dichotomous classifications of (1) damages with scienter (classified as punitive by Powell) versus damages without scienter (classified as non-punitive by Powell), and (2) a penal and criminal (punitive) remedy versus a civil (non-punitive) proceeding with treble damages. Again, the U. S. Supreme Court has used a scale of continuous gradation, a continuum or spectrum, between purely compensatory and strictly punitive when classifying various statutory treble-damages provisions as compensatory or punitive for the purpose of their application in civil proceedings.35 Further, we need not address the logical coherence of Powell's scienter argument36 since the authority cited originates from other jurisdictions and predates McIntosh, and does not detract from the legislative history discussed in McIntosh and which was used for concluding 47 O.S. § 10-103 was amended for the purpose of deterrence and controlling behavior of drivers. ¶23 Powell also relied on Alea London, Ltd. v. Am. Home Servs., Inc., 638 F.3d 768 (11th Cir. 2011), where an insurance policy excluded punitive damages, did not define punitive damages, and the disputed issue was whether a statute which allowed an amount of damages up to a trebling of the statutory compensatory damages in 47 U.S.C. § 227(b)(3) also constituted punitive damages for the purpose of the punitive damages exclusion in the policy. The Circuit Court noted the U. S. Supreme Court's spectrum of compensatory and punitive awards, and the disputed issue turned on "the workings of a particular statute and the course of particular litigation."37 The Circuit Court focused on two issues: (1) The amount multiplied was a small determined statutory amount, $500.00; and (2) Damages could be trebled without any showing the defendant's conduct was an entire lack of care, willful misconduct, wantonness, or conscious indifference to consequences. The court concluded the purpose of allowing a statutory trebling of the statutory amount was to encourage plaintiffs to file suit, and was not based upon deterring or punishing the defendant's conduct. ¶24 Nothing in Alea London's analysis detracts from our Court's conclusion in McIntosh that our Legislature desired to deter a driver from fleeing the scene of an accident by legislatively imposing treble damages as a type of civil punitive damages on the compensatory-punitive spectrum. We again conclude the treble damages in 47 O.S.2011, § 10-103 serve a deterrence and punitive purpose. The issue presented by the parties is the effect of this classification upon the policy of insurance at issue. ¶25 Some states allow the insurability of punitive damages directly or vicariously assessed against the insured when provided by the insurance policy.38 More than twenty-five years ago, the United States Court of Appeals for the Tenth Circuit stated: "Oklahoma courts adhere to the view that public policy prohibits liability insurance coverage of punitive damages except where the party seeking the benefit of insurance coverage has been held liable for punitive damages solely due to conduct of another, under principles of vicarious liability."39 In Dayton Hudson Corp. v. American Mut. Liability Ins. Co., 1980 OK 193, 621 P.2d 1155, 16 A.L.R.4th 1, this Court explained a policy provision requiring insurer to pay "for all sums which the insured might become legally obligated to pay" was sufficiently broad to include liability for punitive damages when such damages were not "specifically excluded" by the policy.40 ¶26 This Court has recognized for more than one-hundred years that an insurer and insured are free to agree to a policy's provisions and how they are construed, provided such agreement does not conflict with public policy.41 The policy at issue states the insurer "will pay damages for bodily injury and property damage for which an insured person becomes legally responsible because of an accident."42 However, the insurance policy also lists exclusions from coverage, and the list includes "9. bodily injury or property damage caused by an intentional act of that insured person," and "16. punitive or exemplary damages."43 The parties disagree whether the exclusion "punitive or exemplary damages" includes within its meaning the treble damages in 47 O.S.2011, § 10-103. ¶27 An insurance policy is issued pursuant to statutes, and the provisions of those statutes are given force and effect as if written into the policy.44 Courts construe terms in an insurance policy consistent with insurance statutes on the same subject.45 The interpretation of an insurance contract and whether it is ambiguous is determined by the court as a matter of law.46 ¶28 The punitive nature of treble damages in 47 O.S. § 10-103 is not ambiguous. Our 1980 opinion in Dayton Hudson stated a policy's coverage included punitive damages unless excluded by the language of the policy. A few years later in 1987, 47 O.S. § 10-103 was amended to include a criminal penalty and treble civil damages. At the time of this amendment to 47 O.S. § 10-103, the U. S. Supreme Court already had a history of discussing treble and quadruple statutory damages as a form of civil punitive damages.47 Statutes combining a criminal penalty and a civil statutory punitive damages provision existed many years prior to 1987.48 ¶29 Generally, a statutory multiplier for damages has a punitive nature when damages are meant to punish "the wrongdoer" and to act as a deterrent to others.49 One cause of action may not be used to claim both common-law punitive damages and statutory punitive damages when the statutorily-authorized damages are designed to supplant the common-law punitive damages for that cause of action.50 The nature of the wrongful conduct sufficient to support an award of statutory punitive damages is not necessarily synonymous with wrongful conduct to support an award of common-law punitive damages. For example, when discussing the 1981 version of the Oklahoma Residential Landlord Tenant Act, (ORLTA) 41 O.S.1981 § 101 et seq., we stated: "Considering the legislature's apparent intent in enacting the ORLTA together with prior case law, we find that the tenant's cause of action is regulated and determined by the statute, as is the remedy."51 In other words, the scope of statutory punitive damages and the nature of conduct authorizing such may be based upon and controlled by the statutory language, and 47 O.S.2011, § 10-103 states when treble damages are authorized. ¶30 Considering the well-known history of statutorily multiplied damages in the context of a combined punitive and deterrent purpose, our discussion of the Legislature's purpose for 47 O.S. § 10-103 in 1987, and construction of this statute as part of the insurance policy, we conclude the statutory treble damages in 47 O.S.2011, § 10-103 are for the purpose of controlling conduct of drivers and are punitive in nature. We conclude the treble damages in 47 O.S.2011, § 10-103 are punitive for the purpose of the exclusion in the policy. IV. Conclusion ¶31 The District Court relied on McIntosh and concluded the treble damages provision in 47 O.S.2011, § 10-103 had a primary purpose to deter hit-and-run drivers, and "is more aligned with the definition of punitive damages than it is with non-punitive or compensatory" damages. We agree. ¶32 The District Court's consent judgment was based, in part, on its prior adjudication stating statutory treble damages in 47 O.S.2011, § 10-103 were punitive damages, and punitive damages were expressly excluded by the policy. We agree. The statutory treble damages in 47 O.S. 2011, § 10-103 were excluded by the policy. ¶33 The District Court's consent judgment is affirmed. ¶34 CONCUR: DARBY, C.J.; KANE, V.C.J.; WINCHESTER, EDMONDSON, COMBS, GURICH, ROWE, and KUEHN, JJ. ¶35 NOT PARTICIPATING: KAUGER, J. FOOTNOTES 1 Appellant's Record on Accelerated Appeal, Plaintiff's Motion for Summary Judgment (Jan. 22, 2020), p. 1. 2 Teel v. Public Serv. Co., 1985 OK 112, 767 P.2d 391, 395, superseded in part by statute on other grounds noted in Hull v. Sun Refining and Marketing Co., 1989 OK 168, 789 P.2d 1272, 1278. 3 Andrew v. Depani-Sparkes, 2017 OK 42, ¶ 14, 396 P.3d 210, 217 (quoting LCR, Inc. v. Linwood Properties, 1996 OK 73, 918 P.2d 1388, 1393). 4 Id. 2017 OK 42, ¶¶ 13-14, 396 P.3d at 216-217 (partial summary adjudication was not an interlocutory order immediately appealable, and decision did not become reviewable on appeal until after 12 O.S. § 994 certification) (citing House v. Town of Dickson, 2007 OK 57, ¶ 9, 193 P.3d 964, 967-68 (partial summary adjudication was not a judgment pursuant to 12 O.S. 2011 § 681) and 12 O.S. 2011 § 696.2 (D) (judgment must conform to 12 O.S.2011 § 696.3)); see also Casey v. Casey, 2005 OK 13, n.5 109 P.3d 345, 347 (explaining 12 O.S.2001 § 994); Richardson, Richardson and Boudreaux, PLCC v. Morrissey, 2012 OK 52, n.4, 283 P.3d 308, 310 (upon entry of a judgment a cause of action is merged into the judgment and the cause of action ceases to exist (citing Oklahoma Dept. of Securities ex rel. Faught v. Blair, 2010 OK 16, n.41, 231 P.3d 645, 668)); 12 O.S.2011 § 681 ("A judgment is the final determination of the rights of the parties in an action."). 5 City of Broken Arrow v. Bass Pro Outdoor World, L.L.C., 2011 OK 1, n.2, 250 P.3d 305, 310 (citing Union Oil Co. of Calif. v. Board of Equalization, 1996 OK 40, 913 P.2d 1330, 1334, a trial court granting a summary judgment motion is an adjudication on the merits of a cause of action). 6 Liberty Bank & Tr. Co. v. Rogalin, 1996 OK 10, 912 P.2d 836, 838 (when an action contains more than one claim for relief and a judgment is rendered that leaves a claim or claims unadjudicated, that judgment is not an appealable event in the absence of the statutorily required certificate of the trial judge; and if the unadjudicated claim arises from the same transaction or occurrence as the adjudicated claim the District Court does not have the power to enter a final appealable order as to only the adjudicated portion); Okla. City Urban Renewal Auth. v. City of Okla. City, 2005 OK 2, ¶ 11, 110 P.3d 550, 557 (A judgment is unsuitable for 12 O.S. § 994 certification when the court disposes of but a portion of the contest by leaving unresolved any issue on the merits of the partly-decided claim.). 7 Whitehorse v. Johnson, 2007 OK 11, ¶ 10, 156 P.3d 41, 46 (A consent judgment is an agreement of the parties entered upon the record with the sanction of the trial court; and this agreement of the parties, while not a judicial determination of the rights of the parties, "acquires the status of a judgment through the judge's approval of the agreement," and the terms of the parties' agreement in the judgment are construed "the same way as any other contract."). 8 Hamm v. Hamm, 2015 OK 27, ¶ 3, 350 P.3d 124, 125; see also City of Lawton v. Ayres, 1914 OK 139, 139 P. 963 (Syllabus by the Court) ("Any act on the part of a defendant by which he impliedly recognizes the validity of a judgment against him operates as a waiver to appeal therefrom, or to bring error to reverse it."). 9 Cox v. Kansas City Life Ins. Co., 1999 OK 57, ¶ 20, 983 P.2d 1025, 1029 (citing Teel v. Public Serv. Co., supra note 2, at 767 P.2d at 396). 10 12 O.S.2011 § 952 (a): "The Supreme Court may reverse, vacate or modify judgments of the district court for errors appearing on the record, and in the reversal of such judgment may reverse, vacate or modify any intermediate order involving the merits of the action, or any portion thereof." 11 12 O.S.Supp.2013, Ch. 15, App. 1, Okla. Sup. Ct. R. 1.36 (a) (1) & (2); Lincoln Farm, L.L.C. v. Oppliger, 2013 OK 85, n. 15, 315 P.3d 971, 976 (an order denying a motion for summary judgment is not an interlocutory order immediately appealable by right nor could the order be certified for review by certiorari in advance of judgment). 12 Summary judgment filings also serve as the appellate briefs for review of the summary judgment unless the appellate court orders the materials to be supplemented with a brief. Farley v. City of Claremore, 2020 OK 30, ¶ 20, 465 P.3d 1213, 1225 ("In an appeal controlled by Okla. Sup. Ct. R. 1.36 the briefs in the appellate court are those which were considered by the trial court when it issued the order reviewed in the 1.36 appeal."); Harkrider v. Posey, 2000 OK 94, n. 50, 24 P.3d 821, 833 (An appellate court may order supplemental briefs for adjudication of an appeal from a summary judgment.). 13 Andrew v. Depani-Sparkes, supra note 3, at 2017 OK 42, ¶ 24, 396 P.3d at 219 (explaining "we do not depart from that principle" stated in District Court Rule 13(b) and its requirement a party may not rely in an appeal on any fact or material not referred to or included in a rule-required party's statement which was used by the trial court for its summary adjudication). 14 An appellate court possesses authority to order any portion of the trial court record to be filed in an appeal at any stage of the appeal. Okla. Sup. Ct. R. 1.28. The Court's order does not raise any due process notice issue for the parties because requiring a Rule 1.36 appellate record with trial court filings also serving as appellate briefs is a result consistent with the parties litigating the issue before us within a summary judgment procedure. The Court possesses Okla. Const. Art. 7 § 4 discretion consistent with Okla. Const. Art. 2 § 7 to require an appeal to conform to a particular procedure, and judicial economy in a controversy, as in the case before us, may require a particular procedure. 15 Shepard v. Okla. Dept. of Corrections, 2015 OK 8, n. 2, 345 P.3d 377, 379 (quoting Okla. Sup. Ct. R. 1.24(a), "Every appeal is subject to assignment to the Court of Civil Appeals unless retained by the Supreme Court either pursuant to a motion to retain or on the Court's own motion."). 16 Appellant's additional assignment of error is the more general "whether the trial court erred in granting the motion for summary judgment." 17 Johnson v. CSAA General Ins. Co., 2020 OK 110, ¶ 11, 478 P.3d 422, 427 ("De novo appellate review is used for issues of law arising from both § 2012(B)(6) motion to dismiss and summary judgment adjudications."). 18 Thurston v. State Farm Mut. Auto. Ins. Co., 2020 OK 105, ¶ 2, 478 P.3d 415, 417 (citing American Biomedical Grp. v. Techtrol, Inc., 2016 OK 55, ¶ 2, 374 P.3d 820, 822). 19 Indep. Sch. Dist. No. 52 of Okla. Cty. v. Hofmeister, 2020 OK 56, ¶ 17, 473 P.3d 475, 485 ("an issue of law is presented by questions concerning the application of a statute to an uncontested fact, and de novo appellate review is used by the Court"); State ex rel. Okla. State Bd. of Med. Licensure and Supervision v. Rivero, 2021 OK 31, ¶ 42, 489 P.3d 36, 53 ("The interpretation to be given to a statute is a question of law, subject to our plenary, independent and non-deferential examination applying a de novo standard of review."). 20 In re Oneok Field Services Gathering, LLC, 2001 OK 116, ¶ 7, 38 P.3d 900, 903 ("Because the meaning of statutory language is a pure issue of law and because the trial court's disposition was effected by summary judgment, the issue stands before us for de novo review."); see also K & H Well Serv., Inc. v. Tcina, Inc., 2002 OK 62, ¶ 9, 51 P.3d 1219, 1223 (in an action tried by the trial court its conclusions of law present issues of law reviewed de novo by an appellate court). 21 Johnson, supra note 17, at ¶ 9, 478 P.3d at 426. 22 State Farm Mut. Auto. Insur. Co. v. Campbell, 538 U.S. 408, 416, 123 S. Ct. 1513, 155 L. Ed. 2d 585 (2003). 23 PacifiCare Health Sys., Inc. v. Book, 538 U.S. 401, 405, 123 S. Ct. 1531, 155 L. Ed. 2d 578 (2003). 24 Id. 538 U.S. at 405 (citing Vermont Agency of Nat. Resources v. U. S. ex rel. Stevens, 529 U.S. 765, 784, 120 S. Ct. 1858, 146 L. Ed. 2d 836 (2000) and construction of the False Claims Act, 31 U.S.C. §§ 3729--3733). 25 Id. 538 U.S. at 405-06 (citing Brunswick Corp. v. Pueblo Bowl--O--Mat, Inc., 429 U.S. 477, 485, 97 S. Ct. 690, 50 L. Ed. 2d 701 (1977) and construction of treble-damages provision of § 4 of the Clayton Act, 15 U.S.C. § 15). 26 Id. 538 U.S. at 406 (citing American Soc. of Mechanical Engineers, Inc. v. Hydrolevel Corp., 456 U.S. 556, 575, 102 S. Ct. 1935, 72 L. Ed. 2d 330 (1982), construction of § 4 of the Clayton Act, 15 U.S.C. § 15 (1976), and conclusion an antitrust private action allowing for treble damages was created primarily as a remedy for the victims of antitrust violations). 27 Id. (citing Cook County v. U. S. ex rel. Chandler, 538 U.S. 119, 123 S. Ct. 1239, 155 L. Ed. 2d 247 (2003) and its recognition "treble damages have a compensatory side, serving remedial purposes in addition to punitive objectives"). 28 Id. (citing Agency Holding Corp. v. Malley--Duff & Assocs., Inc., 483 U.S. 143, 151, 107 S. Ct. 2759, 97 L. Ed. 2d 121 (1987), and concluding both RICO, 18 U.S.C. § 1964 (1982 ed. and Supp. III), and § 4 of the Clayton Act (15 U.S.C. § 15) were designed to remedy economic injury by providing for the recovery of treble damages, costs, and attorney's fees). 29 Id. (citing Shearson/American Express Inc. v. McMahon, 482 U.S. 220, 241, 107 S. Ct. 2332, 96 L. Ed. 2d 185 (1987) noting "remedial function" of RICO's treble-damages provision). 30 Cook Cnty., Ill. v. U. S. ex rel. Chandler, 538 U.S. at 130. 31 Thiry v. Armstrong World Inds., 1983 OK 28, 661 P.2d 515, 518 (the purpose of compensatory damages is to benefit an individual plaintiff, and punitive damages benefit society with a plaintiff acting as a private attorney general to punish the culpable wrongdoer). We need not address in this controversy any differences in application and analysis between the amount of punitive damages determined by a jury and a statutorily-determined amount of damages with a punitive purpose. 32 Goss v. Trinity Savs. & Loan Ass'n, 1991 OK 19, 813 P.2d 492, 495; cf. LeFlore v. Reflections of Tulsa, Inc., 1985 OK 72, 708 P.2d 1068, 1077 (punitive damages are allowed as punishment for the benefit of society as a restraint upon the transgressor, and a warning and example serving as a deterrent to such conduct); Oller v. Hicks, 1967 OK 240, 441 P.2d 356, 360 (same). 33 McIntosh v. Watkins, 2019 OK 6, at ¶ 12, 441 P.2d at 1099 (citing 1987 Okla. Sess. Laws, c. 224, § 15). 34 Id. 2019 OK 6, ¶ 15, 441 P.3d at 1100. 35 PacifiCare Health Sys., Inc. v. Book, supra note 23, at 538 U.S. 405-406. 36 But see, e.g., U.S. v. Jackson, 736 F.3d 953, 957-959 (10th Cir. 2013), cert. denied, 572 U.S. 1041, 134 S. Ct. 1777, 188 L. Ed. 2d 606 (2014) (omission of an expression of scienter from a statute does not necessarily transform the statute into one of strict liability, and the court also noted proof of certain conduct was proof of a type of scienter showing culpability); Wagoner v. Bennett, 1991 OK 70, 814 P.2d 476, infra at ¶ 29 and the discussion of statutory damages governed by statutory language. 37 Alea London, Ltd., 638 F.3d at 776-777. 38 See, e.g., Whalen v. On-Deck, Inc., 514 A.2d 1072 (Del. 1986) (public policy of the State did not prohibit the issuance of an insurance contract that covered punitive damages, and the controversy was remanded for a determination if the policy covered such damages); Abbie Uriguen Oldsmobile Buick, Inc. v. U. S. Fire Ins. Co., 95 Idaho 501, 511 P.2d 783 (1973) (when a policy made no distinction between actual and punitive damages, and punitive damages were not specifically excluded from the policy language, then punitive damages were included under the provision of the policy the insurer promised to pay all sums which the insured was legally obligated to pay as damages caused by the use of an automobile). 39 Magnum Foods Inc. v. Cont'l Cas. Co., 36 F.3d 1491, 1504 (10th Cir. 1994) (citing Dayton Hudson Corp. v. American Mut. Liability Ins. Co., 1980 OK 193, 621 P.2d 1155, 1156, 16 A.L.R.4th 1; Aetna Cas. & Sur. Co. v. Craig, 1989 OK 43, 771 P.2d 212, 215 ("when the insured/employer is party to or acquiesces in, the wrongful acts, liability insurance will not protect it against awards of punitive damages because of his, the insured's, 'positive wrongdoing.' "); Oliver v. Producers Gas Co., 1990 OK CIV APP 28, 798 P.2d 1090 (holding that insurance policy proceeds received from tortfeasor could not be applied to punitive damages)). 40 Dayton Hudson Corp., 621 P.2d at 1158 (emphasis added). 41 Hensley v. State Farm Fire & Cas. Co., 2017 OK 57, ¶ 32, 398 P.3d 11, 22. 42 Appellant's Record on Accelerated Appeal, Plaintiff's Motion for Summary Judgment (Jan. 22, 2020), Exhibit 3, Oklahoma Auto Policy, p. 3, "Liability to Others." 43 Appellant's Record on Accelerated Appeal, Plaintiff's Motion for Summary Judgment (Jan. 22, 2020), Exhibit 3, Oklahoma Auto Policy, pg. 3, "Exclusions." 44 Thurston v. State Farm Mut. Auto. Ins. Co., 2020 OK 105, ¶ 20, 478 P.3d 415, 420-21. 45 Johnson v. CSAA Gen. Ins. Co., 2020 OK 110, ¶ 30, 478 P.3d 422, 433. 46 Oklahoma Schools Risk Management Trust v. McAlester Public Schools, 2019 OK 3, ¶ 22, 457 P.3d 997, 1005. 47 See, e.g., U.S. ex rel. Marcus v. Hess, 317 U.S. 537, 550-51, 63 S. Ct. 379, 87 L. Ed. 443 (1943) (statute providing civil remedy in the amount of double damages afforded complete indemnity [or compensatory damages] for the injuries suffered, Congress could provide three-fold and remain fully in the common law tradition, and "This Court has noted the general practice in state statutes of allowing double or treble or even quadruple damages."). 48 Id. 317 U.S. at 551 (citing O'Sullivan v. Felix, 233 U.S. 318, 324, 325, 34 S. Ct. 596, 58 L. Ed. 980 (1914) and stating: "Punitive or exemplary damages have been held recoverable under a statute like this which combines provision for criminal punishment with others which afford a civil remedy to the individual injured."). 49 Wagoner v. Bennett, 1991 OK 70, 814 P.2d 476, 478. 50 Id. 814 P.2d at 481. 51 Id. 814 P.2d at 480 (emphasis added).

385d4c61-17a0-4195-b082-b617f365700a

Booth v. Home Depot, U.S.A.

oklahoma

Oklahoma Supreme Court

BOOTH v. HOME DEPOT2022 OK 16Case Number: 119924Decided: 02/15/2022IN THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JEFFREY BOOTH, Plaintiff/Appellant, v. HOME DEPOT, U.S.A., INC., Defendant/Appellee. CERTIFIED QUESTION FROM THE UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT ¶0 The United States Court of Appeals for the Tenth Circuit certified to this Court a question of state law based on the Revised Uniform Certification of Questions of Law Act, 20 O.S. §§ 1601-1611. CERTIFIED QUESTION ANSWERED Mark Hammons, Amber L. Hurst, Hammons, Hurst & Associates, Oklahoma City, Oklahoma, for Plaintiff/Appellant. Anh Kim Tran, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., Oklahoma City, Oklahoma, for Defendant/Appellee. KUEHN, J.: ¶1 The United States Court of Appeals for the Tenth Circuit certified a question of state law to this Court under the Revised Uniform Certification of Questions of Law Act, 20 O.S. §§ 1601-1611. ¶2 This Court may reformulate the question certified by the federal court, and we choose to do so here as the certified question is too narrow. Siloam Springs Hotel, LLC v. Century Surety Co., 2017 OK 14, ¶ 15, 392 P.3d 262, 266. The reformulated question1 we will answer is: "Does the Oklahoma Home Repair Fraud Act, 15 O.S. § 765.32, or the Oklahoma Consumer Protection Act, 15 O.S. § 753 (15), (20)3, articulate a clear mandate of Oklahoma public policy such that an employer who terminates an employee for reporting the employer''s violation of either statute is liable for wrongful termination under Burk v. K-Mart Corp., 1989 OK 22, 770 P.2d 24?" ¶3 The certified question is answered in the negative. I. CERTIFIED FACTS4 AND PROCEDURAL HISTORY ¶4 Appellant Jeffrey Booth, then an installation service manager for Appellee Home Depot, U.S.A., noticed at a job site that the customer was being charged for window wraps that were not needed. Mr. Booth phoned and emailed his supervisor about the perceived overcharge. The supervisor responded that an overcharge at the beginning of a billing cycle did not really exist because projects go over budget. Mr. Booth replied that Home Depot does not issue refunds for those overcharges if a project does not exceed its budget. Per Mr. Booth, the supervisor ignored this remark. ¶5 The next day, Appellee began an investigation of Mr. Booth for an email he sent ten days earlier critiquing a colleague''s work performance. After a one-day investigation of the allegation in the email, and two days after the overcharge report, Appellant Booth was terminated. ¶6 Mr. Booth sued Home Depot in Oklahoma state court claiming wrongful termination under Burk, alleging his job performance was good and that the email investigation was only a pretext for the real reason for termination -- his reporting of the overcharging of customers to his supervisor. Home Depot removed the Oklahoma County case to the federal district court under diversity jurisdiction. ¶7 In his amended federal complaint, Appellant Booth claims that the overcharging of customers violated the Oklahoma Home Repair Fraud Act, 15 O.S. § 765.3, and/or the Oklahoma Consumer Protection Act, 15 O.S. § 753(15), (20). In its defense, Appellee Home Depot does not dispute that, if overcharging occurred, it would violate those acts. Home Depot argues that the violation of the statutes does not articulate a clear mandate of Oklahoma public policy sufficient to support a Burk tort. ¶8 The federal district court agreed with Home Depot that the statutes do not articulate a clear public policy and dismissed the petition for failure to state a claim upon which relief can be granted. Appellant Booth then appealed to the United States Court of Appeals for the Tenth Circuit, which then certified the question about the statutes to this Court. II. ANSWERING CERTIFIED QUESTIONS ¶9 This Court''s examination of the certified question is confined to resolving questions of law, not facts. Russell v. Chase Inv. Servs. Corp., 2009 OK 22, ¶ 8, 212 P.3d 1178, 1181. The Court, when assessing whether a certified federal question of law should be answered, considers: (1) whether the answer would be dispositive of an issue in pending litigation in the certifying court; and (2) whether there is established and controlling law on the subject matter. 20 O.S. § 1602; Siloam Springs Hotel, 2017 OK 14, ¶ 14, 392 P.3d at 265-66. Answering the certified question here would be dispositive of a pending issue in the federal court, and there is no controlling case on whether the OCPA and the OHRFA articulate clear public policy. 15 O.S. § 765.3 and 15 O.S. § 753 (15), (20). III. ANALYSIS ¶10 Oklahoma has long recognized the employment-at-will doctrine. An employer can discharge an employee for "good cause, no cause, or even for a morally wrong cause without being liable for a legal wrong." Reynolds v. Advance Alarms, Inc., 2009 OK 97, ¶ 5, 232 P.3d 907, 909. ¶11 This Court has held that those at-will contractual rights may be limited by the public policy of the State of Oklahoma. Siloam Springs Hotel, 2017 OK 14, ¶ 20, 392 P.3d at 267--68. In establishing this judicially created exception in Burk, the Court delineated the elements one must prove to qualify for a public policy exception: (1) an actual or constructive discharge (2) of an at-will employee (3) in significant part for a reason that violates an Oklahoma public policy goal (4) that is found in Oklahoma''s constitutional, statutory, or decisional law or in a federal constitutional provision that prescribes a norm of conduct for Oklahoma, and (5) no statutory remedy exists that is adequate to protect the Oklahoma policy goal. Vasek v. Bd. of Cnty. Comm''rs of Noble Cnty., 2008 OK 35, ¶ 14, 186 P.3d 928, 932. An employer''s violation of a state-declared public policy is the "fundamental predicate for a Burk tort." Darrow v. Integris Health, Inc., 2008 OK 1, ¶ 10, 176 P.3d 1204, 1210. Neither the OCPA nor the HRFA identifies a clear and compelling public policy that creates an exception to the at-will doctrine. ¶12 Appellant argues that, because the Acts protect all Oklahomans from criminal actions of fraud by a retailer, public policy is clearly established. Not so. The OCPA and the HRFA are not primarily criminal statutes. Both create civil remedies for unsuspecting consumers for the misleading actions of retailers. Even if the Acts were exclusively criminal in nature, this Court has already held that reporting criminal activity is not infused with the necessary clear and compelling public policy sufficient to protect the employee from discharge under the tort established in Burk. Hayes v. Eateries, Inc., 1995 OK 108, ¶ 25, 905 P.2d 778, 787.5 If a criminal statute is violated and the employee reports the crime only to be fired, this Court will not find that the Legislature has created public policy unless the public interest for reporting the crime is completely entwined with the criminal law. Darrow, 2008 OK 1, ¶ 18, 176 P.3d at 1215. ¶13 In Darrow, the employee was discharged for reporting fraud. But unlike this case, the victim of the fraud was the entire population of Oklahoma, not an indeterminate number of individual victims. The employee was reporting fraud on the Medicare system, a financial system supported with general public tax dollars and potentially benefitting the public as a whole. Darrow, 2008 OK 1, ¶ 18, 176 P.3d at 1215. A policy to protect public funds from theft, thus protecting the public welfare, is within the narrow exception to the at-will doctrine established in Burk. ¶14 The Darrow Court began to establish our test for understanding what statutes create a clear and compelling statement of public policy. Absent an announcement written in the statute that "public policy" is the motivation behind the legislators'' intent, recent decisions of this Court have expounded upon how to determine if a clear and compelling public policy exists in the law. ¶15 Although over the years Justices may have disagreed on the application of Burk in individual cases, Burk''s fundamental scope is easily understood. In Darrow, this Court determined that violations of "public health, safety, and welfare" are protected by clear and compelling public policy. Darrow, 2008 OK 1, ¶ 20, 176 P.3d at 1216. This narrowly limits the Burk exception to only those matters which affect the welfare of the State as a whole and fit within the traditional limitations of government action. For instance, in Collier v. Insignia Fin. Grp., 1999 OK 49, ¶ 11, 981 P.2d 321, 324--25, the Court held that the language of Oklahoma''s Anti-Discrimination Act "clearly articulates a public policy which castigates sexual harassment in the workplace." The law established the public policy that no employers may condition employment of any employee on quid pro quo sexual favors -- i.e., protection of the State''s workforce is a matter of public welfare. Id.; 25 O.S. § 1302. This Court found a violation of public health and safety in Silver v. CPC-Sherwood Manor, Inc., 2004 OK 1, 84 P.3d 728. The Court held that statutes articulated "state public policy prohibiting the holding, preparing, or delivering of food prepared under conditions whereby it may have been rendered diseased, unwholesome, or injurious to health." Id. at ¶ 7, 84 P.3d at 730. Public policy is established when a law is violated that protects the public from harm to their health, safety, and welfare. ¶16 Appellant asks this Court to expand the areas traditionally protected by public policy in the employment context. Neither statute at issue here protects the public health, safety or welfare; instead, these statutes offer protection to consumers from a variety of unlawful business practices. Basically, Appellant wants the Burk exception to include the protection of individualized economic harm. This we cannot do. Not only do the statutes not encompass an area recognized by the Court as protected by public policy, but the argument also fails as the harm is not to the public. The OCPA and the OHRFA protect individuals who may encounter a fraudulent merchant, not Oklahoma citizens in general. 15 O.S. § 765.3; 15 O.S. § 753 (15), (20). ¶17 Neither statute articulates a public policy goal to satisfy Burk. In addition, the statutes provide specific remedies for persons harmed by violations of the Acts. Here, Appellant''s argument also fails part 5 of the Burk test, as a statutory remedy exists that is adequate to protect customers from bad merchants. Vasek, 2008 OK 35, ¶ 14, 186 P.3d at 932. Both the OHRFA and the OCPA provide specific circumstances that qualify for violations against individual consumers and are remedied with civil actions or criminal indictment - on the consumer''s behalf - by the Attorney General or district attorneys. 15 O.S. §§ 757-63. Both Acts also, crucially, provide for a private right of action or damages by a wronged customer against the merchant. 15 O.S. § 761.1. And these remedies reflect the individual, economic nature of the injuries. The Legislature is focused on the harm to the consumer, not an employer/employee relationship. Decisions concerning the creation or abolishment of public policy causes of action are within the judgment of the Legislature. Torres v. Seaboard Foods, LLC, 2016 OK 20, ¶ 35, 373 P.3d 1057, 1075. If a sufficient statutory remedy is available to right the harm to the public, then a Burk tort is not available in the district court. Southon v. Okla. Tire Recyclers, LLC, 2019 OK 37, ¶ 18, 443 P.3d 566, 573. ¶18 Here, the internal reporting of a possible customer overcharge could be resolved by the filing of a cause of action to rectify the practice and payments to any victims. The Appellant''s internal reporting of what he believes was fraudulent did nothing to protect a specific customer. Appellant argues that he was protecting all potential future customers from any illegal practice, but that argument does not help him reach the public policy exception. Even if 100 or 1000 customers were potentially harmed, the statutes are not in place to create a public policy against protecting the public in general from overcharge. ¶19 The OHRFA and the OCPA protect specific individual consumers against fraud with criminal and civil remedies for those individual victims. The Court will not expand our public policy exceptions to include protection from economic harm. Without a clear mandate from the Legislature, the Acts do not qualify as an established public policy. CERTIFIED QUESTION ANSWERED CONCUR: DARBY, C.J., KANE, V.C.J., WINCHESTER, EDMONDSON, COMBS, GURICH, ROWE and KUEHN, JJ. CONCUR IN PART and DISSENT IN PART: KAUGER, J. FOOTNOTES 1 The question certified by the United States Court of Appeals for the Tenth Circuit was: Does the Oklahoma Home Repair Fraud Act, 15 O.S. § 765.3, or the Oklahoma Consumer Protection Act, 15 O.S. § 753 (15), (20), articulate a clear mandate of Oklahoma public policy such that an employer who terminates an employee for internally reporting the employer''s violations of the statutes is liable for wrongful termination under Burk v. K-Mart Corporation, 770 P.2d 24 (Okla. 1989)? The question was reformulated by this Court to answer the broader legal question on public policy, which is dispositive of the more factual question certified by the Appeals Court. 2 "Acts constituting fraud: A person commits the offense of home repair fraud if the person knowingly or with reason to know: 1. enters into a consumer transaction for home repair and knowingly or with reason to know: a. misrepresents a material fact relating to the terms of the consumer transaction or the preexisting or existing condition of any portion of the property involved, or creates or confirms an impression of the consumer which is false and which the violator does not believe to be true, or promises performance which the violator does not intend to perform or knows will not be performed; or b. uses or employs any deception, false pretense or false promises in order to induce, encourage or solicit such consumer to enter into any consumer transaction; or c. requires payment for the home repair at a price which unreasonably exceeds the value of the services and materials needed for the home repair; 2. damages the property of a person with the intent to enter into a consumer transaction for home repair; or 3. misrepresents himself or another to be an employee or agent of any unit of the federal, state, county, or municipal government, or an employee or agent of any public utility, with the intent to cause a person to enter into, with himself or another, any consumer transaction for home repair." 15 O.S. § 765.3. 3 "A person engages in a practice which is declared to be unlawful under the Oklahoma Consumer Protection Act when, in the course of the person''s business, the person: ... 15. Falsely states, knowingly or with reason to know, that services, replacements or repairs are needed... 20. Commits an unfair or deceptive trade practice as defined in Section 752 of this title..." 15 O.S. § 753 (15), (20). 4 The Court does not presume facts outside those offered by the certification order. Siloam Springs Hotel, LLC v. Century Surety Co., 2017 OK 14, ¶ 2, 392 P.3d 262, 263; Howard v. Zimmer, Inc., 2013 OK 17, n.5, 299 P.3d 463, 465; In re Harris, 2002 OK 35, ¶ 4 n.5, 49 P.3d 710, 713. 5 In Hayes, the fired employee argued that his reporting of another employee''s fraud on the employer constituted a violation of public policy. Id. ¶ 20, 905 P.2d at 785. The Court held, if the report of fraud was made to internal supervisors or the police, the actions of reporting a crime were not automatically established public policy. Id. ¶ 27, 905 P.2d at 788. The Hayes Court held that the fraud reported by the employee affected the private and proprietary rights of the employer, not the general public, and therefore no Burk exception was created by the statute.

298be3bf-5e32-4820-8151-b0e7e3bbf525

FRANK BARTEL TRANSPORTATION v. STATE

oklahoma

Oklahoma Supreme Court

FRANK BARTEL TRANSPORTATION v. STATE ex rel. MURRAY STATE COLLEGE2023 OK 121Case Number: 121252Decided: 12/19/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. FRANK BARTEL TRANSPORTATION, Inc. Plaintiff/Petitioner, v. THE STATE OF OKLAHOMA, ex rel. MURRAY STATE COLLEGE, Defendant/Respondent, ¶0 Petitioner Frank Bartel Transportation, Inc., petitioned for writ of certiorari from an order granting partial summary judgment, which presented a claim of first impression under the Governmental Tort Claims Act. We granted the petition for writ of certiorari, reverse the trial court's decision, and remand to the trial court for further proceedings. CERTIORARI PREVIOUSLY GRANTED; TRIAL COURT REVERSED; REMANDED TO TRIAL COURT FOR FURTHER PROCEEDINGS Christopher A. Barrow, Emily B. Kosmider, Barrow & Grimm P.C., Tulsa, Oklahoma, for Plaintiff/Petitioner Tracy E. Neel, Kevin L. McClure, Oklahoma Attorney General, Oklahoma City, Oklahoma, for Defendant/Respondent KUEHN, J.: ¶1 On March 27, 2019, a sedan owned by Murray State College and driven by a College employee hit head-on a semi truck and trailer owned by Frank Bartel Transportation (FBT). The College employee was killed. The FBT vehicle sustained damage and caught fire and its driver was hospitalized. FBT submitted a claim under the Government Tort Claims Act, 51 O.S. Sections 151 et seq., to the State of Oklahoma Risk Management Department of the Office of Management and Enterprise Services (OMES). OMES offered to settle the case for $25,000. FBT refused. ¶2 OMES maintains that the claim is for property loss only, and thus controlled by the $25,000 statutory cap in 51 O.S. Section 154(A)(1). FBT claims that, in addition to the direct property loss of its vehicle, it sustained consequential damages of $68,636.61, for towing, vehicle storage, and vehicle rental, and thus the claim is subject to the $125,000 statutory cap in 51 O.S. Section 154(A)(2). FBT moved for partial summary judgment, asking which statutory section controlled. On March 27, 2023, the district court determined that FBT's damages were all for loss of property and subject to the Section 154(A)(1) cap of $25,000. The district court certified that order for immediate appeal, as it affected a substantial part of the merits, and immediate appeal would materially advance the ultimate termination of the litigation. 12 O.S. § 952(b)(3). This Court accepted certiorari and we now reverse. Review of a Certified Interlocutory Order ¶3 The district court's order was made as the result of a motion for partial summary judgment. Reflexive application of Supreme Court Rule 1.50 would not permit review of a certified interlocutory order on a motion for summary judgment. Rule 1.50, Rules of the Oklahoma Supreme Court, Title 12, ch. 15. app. 1. However, when applying Rule 1.50 we look at the contents of a pleading, not merely its title. See Purvey v. State, 1995 OK 103, ¶ 4, 905 P.2d 770, 771 (in GTCA case, pleading titled motion for summary judgment was substantively a motion to dismiss, and thus reviewable); Roach v. Jimmy D. Enterprises, 1996 OK 26, ¶ 3, 912 P.2d 852, 853-54 (motion for summary judgment was reviewable as a substantive request to decide legal issue of statutory interpretation). It is clear from the face of the order that the court's ruling settled a question of law. The trial court neither granted nor denied the motion for partial summary judgment. Rather, it found as a matter of law that FBT's damages resulted from loss of property under Section 154(A)(1), and ordered that FBT's damages were subject to the GTCA $25,000 cap. Because this legal determination -- an issue of first impression -- would affect any further proceedings on the merits, the trial court certified the order for immediate appeal. And that is why this Court granted certiorari: to settle a pure question of law involving statutory interpretation. Our review is de novo. Ghoussoub v. Yammine, 2022 OK 64, ¶ 11, 518 P.3d 110, 113. Analysis Statutory Language ¶4 The GTCA was enacted to settle questions of tort liability arising from the "multi-addered medusa" of state agencies which increasingly performed both governmental and proprietary functions. Vanderpool v. State, 1983 OK 82, ¶ 9, 672 P.2d 1153, 1154-55. It contains explicit and exclusive waivers of the State's immunity from suit. Barrios v. Haskell Cnty. Pub. Facilities Auth., 2018 OK 90, ¶ 8, 432 P.3d 233, 237. The portion of Section 154at issue states: A. The total liability of the state and its political subdivisions on claims within the scope of The Governmental Tort Claims Act, arising out of an accident or occurrence happening after October 1, 1985, Section 151 et seq. of this title, shall not exceed: 1. Twenty-five Thousand Dollars ($25,000.00) for any claim or to any claimant who has more than one claim for loss of property arising out of a single act, accident, or occurrence; 2. Except as otherwise provided in this paragraph, One Hundred Twenty-five Thousand Dollars ($125,000.00) to any claimant for a claim for any other loss arising out of a single act, accident, or occurrence. 51 O.S. § 154(A) (1), (2). This Court has recognized that, where a claim arises from a single accident or occurrence, it may be split into a claim for property damage and a claim for "any other loss". Grisham v. City of Oklahoma City, 2017 OK 69, ¶ 9, 404 P.3d 843, 847-48. However, those terms are not defined by the GTCA, and we have not until now explained their scope. ¶5 In interpreting the GTCA we look, first, to the plain language of the statute itself. I.T.K. v. Mounds Public Schools, 2019 OK 59, ¶ 20, 451 P.3d 125, 135. As we have previously explained, The goal of any inquiry into the meaning of a statutory enactment is to ascertain and give effect to the intent of the legislature. The law-making body is presumed to have expressed its intent in a statute's language and to have intended what the text expresses. If a statute is plain and unambiguous, it will not be subjected to judicial construction, but will receive the effect its language dictates. Only where the intent cannot be ascertained from a statute's text, as when ambiguity or conflict (with other statutes) is shown to exist, may rules of statutory construction be employed. Yocum v. Greenbriar Nursing Home, 2005 OK 27, ¶ 9, 130 P.3d 213, 219. We may not add words that are not there. OKC Zoological Trust v. State ex rel. Pub. Employees Relations Bd., 2007 OK 21, ¶ 6, 158 P.3d 461, 464. If a statute omits a word or phrase, we will presume that is what the Legislature intended. Broadway Clinic v. Liberty Mutual Ins. Co., 2006 OK 29, ¶ 16, 139 P.3d 873, 877. The language in Section 154(A)(2), "any other loss", is broad enough to encompass consequential damages. ¶6 The history of Section 154(A) supports a conclusion that the Legislature intended to include consequential damages in "any other loss". Before 1984 Section 154(A)(1) included the phrase "consequential damages". In 1984, the Legislature amended the provision: 1. Twenty-five Thousand Dollars ($25,000.00) for any claim or to any claimant for any number of claims for damage to or destruction of property, including consequential damages who has more than one claim for loss of property arising out of a single accident or occurrence; Act of the 39th Legislature, 2d Sess., ch. 226, § 5 (to be codified at 51 O.S.Supp.1984, § 154(A)(1). The same amendment added the provision in Section 154(A)(2) for a separate claim for "any other loss" arising from a single accident or occurrence. Act of the 39th Legislature, 2d Sess., ch. 226, § 5 (to be codified at 51 O.S.Supp.1984, § 154(A)(2). That is, the Legislature removed language lumping consequential damages with claims for property loss and added language separating claims for other losses from property loss. It is difficult to read this history as anything other than a clear expression of an intention to allow a separate recovery for consequential damages under Section 154(A)(2). Property Loss and Consequential Damages ¶7 Property damage includes physical and tangible injury or destruction to real or personal property. Consequential damages are "losses that do not flow directly and immediately from an injurious act but that result indirectly from the act." Black's Law Dictionary (11th ed. 2019). OMES's argument conflates damages for indirect losses with damages for loss of real property. Traditionally, damages for repairable property include the cost of repair and value of any loss of use during repair. Brennen v. Aston, 2003 OK 91, ¶ 9, 84 P.3d 99, 101. When a plaintiff shows that its property has diminished in value after repair, that subsequent loss of value may also be recoverable in a claim for property loss. Id., ¶ 12, 84 P.3d at 102. ¶8 OMES relies on this rule to argue that FBT's consequential damages are merely a subset of the actual physical damage to its property because its towing and storage costs, and rental costs while awaiting a replacement, were inevitable when the truck was damaged beyond repair and thus are "directly linked" to FBT's property damage. But that's not what Brennen says. Brennen's measure of damages applies to costs stemming directly from the loss of a repairable property itself: damage to a truck plus cost of repairs of the truck plus the truck's diminished value after it is repaired. This isn't relevant to FBT's claim. FBT's truck could not be repaired, and it had neither repair costs nor depreciation in value. Nor are the towing, storage, and rental costs a direct result of the damage to FBT's truck. A responsible business might well, after its truck was irreparably damaged on a road, take measures to tow and store the vehicle. Arguably, a business owner might choose to avoid those costs by personally retrieving the truck, abandoning it, giving it away. Towing and storage costs are not an inevitable result of the property damage. The mere fact that these costs arose because FBT's property was damaged does not prove that they are directly linked. The law includes a separate category of consequential damages -- "any other loss" under Section 154(A)(2) -- precisely because, after property is damaged, a plaintiff may suffer harm that would not otherwise have occurred in addition to the actual property loss. ¶9 OMES also claims that FBT's claim for the cost of renting a similar truck while awaiting its replacement is part of the property loss of the original truck. It mistakenly relies on DTS Tank Service, Inc. v. Vanderveen, 1984 OK 49, 683 P.2d 1345. The issue there was whether a plaintiff could recover damages, including lost profits while awaiting a replacement, for loss of use of a commercial truck destroyed beyond repair. The plaintiff claimed it was not possible to rent a substitute while awaiting delivery of the replacement. We held that a plaintiff could plead loss of use when suing for damages, but to be fully compensated he must show that he could not have mitigated the loss by renting a temporary replacement while awaiting delivery. DTS Tank Service, 1984 OK 49, ¶ 18, 683 P.2d at 1347. The case doesn't hold that the cost of the rental replacement is relevant at all; the requirement is that, for a claim of loss of use, a plaintiff show it could not rent a replacement, not how much the rental cost would be. DTS Tank Service says nothing about how an actual claim for rental costs should be brought, or into which category of damages it might fall. ¶10 We have previously looked at the distinction between property loss and consequential damages involving a similar but distinct GTCA claim. In Truelock v. City of Del City, 1998 OK 64, 967 P.2d 1183, plaintiffs' home suffered repeated flood damage. They sued under the GTCA for property damage as well as damages for inconvenience, annoyance, and discomfort. The Court of Civil Appeals held that the latter claims were in the nature of property damages, and thus subject to the $25,000 cap under Section 154(A)(1). Truelock, ¶ 4, 967 P.2d at 1186. This Court disagreed. Relying on settled law, we noted that claims for inconvenience, annoyance, and discomfort are personal injury claims. Id. at ¶ 14, 967 P.2d at 1187. In Truelock and the cases on which it relied, we clearly held that such claims may have risen from the same occurrence as a claim for property damage, but were wholly separate from it. Oklahoma City v. Eylar, 1936 OK 614, ¶ 11, 177 Okla. 616, 61 P.2d 649, 651; see, e.g., Oklahoma City v. Tytenicz, 1935 OK 433, ¶ 9, 171 Okla. 519, 43 P.2d 747, 748 (inconvenience, annoyance and discomfort cause of action is injury to the person); City of Holdenville v. Kiser, 1937 OK 29, ¶¶ 4-5, 179 Okla. 216, 64 P.2d 1223, 1225 (same); Phillips Petroleum Co. v Ruble, 1942 OK 93, ¶¶ 10-11, 191 Okla. 36, 127 P.2d 526, 527 (same). And, as separate damages, Truelock's claims were properly categorized as claims for "any other loss" and subject to the larger cap under Section 154(A)(2). Truelock, 1998 OK 64, ¶ 14, 967 P.2d at 1187.1 Other jurisdictions have also concluded that property damage is limited to tangible property, while claims for loss of use, diminution of assets, etc., are consequential losses. Exxon Mobil Corp. v. Albright, 433 Md. 303, 71 A.3d 30, 89 (Ct. App. Md. 2013) (vehicle storage resulting from property loss is consequential damages); Felder v. State Farm Mutual Automobile Ins. Co., 494 N.W.2d 704, 705 (Iowa 1993) (loss of consortium is personal injury, not property loss); Duggan v. Bd of Cnty. Comm'rs of Cnty. Of Weld, 747 P.2d 6, 9 (Colo. App. 1987) (rental value of replacement vehicle is consequential damages); Borden, Inc. v. Howard Trucking Co., 454 So. 2d 1081, 1090 (La. 1983) (on rehearing) (loss of use was consequential loss, not property loss, covered by insurance policy). ¶11 OMES argues that Truelock does not apply because it involved a nuisance claim, not a specific claim of this type of damages under the GTCA. But, as illustrated by cases from other jurisdictions, the legal principle is the same: where a plaintiff suffers injury as an indirect result of property damage, that may be compensable by consequential damages. On its face "any other loss" encompasses more than just nuisance claims. The Legislature deliberately chose that expansive phrase when it amended Section 154(A)(2) almost forty years ago. It would be unreasonable to conclude that the Legislature intended to limit it to nuisance or personal injury claims. We will not presume the Legislature to have done a vain thing. Ghoussoub, 2022 OK 64, ¶ 26, 518 P.3d at 116. Conclusion ¶12 Section 154(A) of the GTCA allows for separate claims for property loss and any other loss caused by actions of the State or its political subdivisions. Property loss includes the tangible injury to or destruction of real or personal property. Consequential losses are incurred from injury which arises indirectly from the property loss. FBT incurred costs for towing, storage, and rental replacement. These consequential damages fall within the "any other loss" provision of Section 154(A)(2), and FBT's recovery is subject to that statute's $125,000 cap. CERTIORARI PREVIOUSLY GRANTED; TRIAL COURT REVERSED; REMANDED TO TRIAL COURT FOR FURTHER PROCEEDINGS ALL JUSTICES CONCUR. FOOTNOTES 1 OMES refers this Court to a Court of Civil Appeals case, Taylor v. Delaware Cnty. Solid Waste Trust Auth., 2021 OK CIV APP 48, 503 P.3d 1216. In that case COCA found plaintiff's nuisance claim was not entitled to recovery under the GTCA and thus Truelock did not apply. Given this conclusion, the case does not aid our analysis.

1cb9a474-2759-413c-b04d-b067dbebe94d

AMOORPOUR v. KIRKHAM

oklahoma

Oklahoma Supreme Court

AMOORPOUR v. KIRKHAM2023 OK 120Case Number: 120181Decided: 12/19/2023IN THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MOHAMMAD AMOORPOUR and MARYAM AMNIFAR, TRUSTEES OF THE AMOORPOUR FAMILY TRUST, Appellees/Counter-Appellants, v. BRENDA J. KIRKHAM, an individual, Appellant/Counter-Appellee, and CARL KIRKHAM, an individual, Defendant, and ALEXANDER WELCHER, JR., an individual, JONATHAN A. WELCHER, an individual, JEANNIE WELCHER, an individual, GAYLE WELCHER, an individual, AMERICAN GUARANTY TITLE INSURANCE COMPANY, Defendants. APPEAL FROM THE DISTRICT COURT OF MCCLAIN COUNTY HONORABLE CHARLES GRAY, ASSOCIATE DISTRICT JUDGE ¶0 Appellees brought a claim against a neighboring landowner to quiet title. The neighboring landowner counterclaimed, alleging adverse possession. After a bench trial, the district court quieted title to Appellees. Appellees then moved for money damages for the rental value of the property and sought a writ of assistance. The district court denied Appellees' requests for relief. The neighboring landowner appealed, and Appellees counter-appealed. The Court retained this case. We affirm the district court's ruling to quiet title to Appellees, holding the neighboring landowner failed to prove adverse possession, and we affirm the district court's denial of Appellees' request for money damages. We reverse the district court's denial of Appellees' request for a writ of assistance. DISTRICT COURT'S JUDGMENT AFFIRMED IN PART AND REVERSED IN PART; REMANDED WITH INSTRUCTIONS. James B. Blevins, George William Velotta, II, and Carrie Kopp, Blevins and Associates Law, PLLC, Purcell, Oklahoma, for Appellant Brenda Kirkham. Christopher C. Lind and Lucas M. West, Nichols Dixon PLLC, Norman, Oklahoma, for Defendants Alexander Welcher, Jr., Jonathan A. Welcher, and Jeannie Welcher. Brett Agree and Jacob Yturri, Garvin Agee Carlton, P.C., Pauls Valley, Oklahoma, for Appellee Mohammad Amoorpour. John Mantooth, Purcell, Oklahoma, for Defendant Gayle Welcher. Winchester, J. ¶1 This matter arises from two competing claims of title to ten (10) acres of property located in McClain County, Oklahoma. Appellant/Counter-Appellee Brenda Kirkham (Kirkham) claims title to the property through adverse possession. Appellees/Counter-Appellants Mohammad Amoorpour (Amoorpour) and Maryam Amnifar, Trustees of the Amoorpour Family Trust, claim title to the property through a warranty deed.1 ¶2 The issues before this Court are whether the district court erred (1) in determining that a 2002 quiet title action involving the same ten acres at issue was dispositive and precluded judgment in favor of Kirkham's claim for adverse possession in this matter; (2) in denying Amoorpour's motion for damages requesting the rental value of the property from Kirkham; and (3) in failing to award possession of the property to Amoorpour. ¶3 The overarching question that this Court must answer is whether Kirkham proved that she adversely possessed the property. Because Kirkham cannot prove that she adversely possessed the property at any time, she has no claim to the property, and Amoorpour hold superior title. We affirm the district court's judgment quieting title to Amoorpour. We also hold that the district court properly denied Amoorpour's motion for damages but erred in failing to grant Amoorpour's writ of assistance. FACTS AND PROCEDURAL HISTORY ¶4 In 1939, Alexander Welcher, Sr. obtained ownership of the ten acres of property at issue through a resale tax deed. Alexander Welcher visited the property at some point in his lifetime but did not reside on the property. In 1993, Alexander Welcher was presumed deceased in the State of Washington. Alexander Welcher's children probated his estate in Washington and Oklahoma. Alexander Welcher's estate in Oklahoma included the ten acres at issue located in Newcastle, Oklahoma, described as follows: The Northwest Quester (NW/4) of the Northwest Quarter (NW/4) of the Southeast Quarter (SE/4) of SECTION FIVE (5), Township NINE (9) North, Range FOUR (4) West, McClain County, Oklahoma. Each of Alexander Welcher's children received one-fifth of the property. ¶5 Two of the children visited the property in the 1990s. Defendant Gay Welcher saw no evidence of activity or ownership of the property by Kirkham. Defendant Alexander Welcher, Jr. did not see any individuals occupying the property. Alexander Welcher, Jr. saw only raw land with brush and did not recall seeing any fences, animals, or improvements on the property. He saw nothing to indicate that any individual was utilizing the land. The taxes for the property were at all times paid by Alexander Welcher, Sr. or his children. ¶6 In 2002, Defendants Jonathan Welcher, Alexander Welcher, Jr., Jeanie Welcher, and Gayle Welcher (collectively Welcher Heirs) sought to quiet title to the property. The Welcher Heirs issued notice to the Bureau of Indian Affairs because the property is in Chickasaw Country and was subject to the interests of the members of the Five Civilized Tribes. The Bureau elected not to remove the quiet title action to federal court, and it agreed to be bound by the district court's judgment. The Welcher Heirs became record owners of the property when the district court filed a judgment in their favor on July 9, 2003. ¶7 The Welcher Heirs then decided to sell the property. In May 2005, Amoorpour purchased the property for $97,000, and the Welcher Heirs deeded the property to him. Amoorpour had no issues with the purchase or the title to the property. He obtained financing, and since that time, he paid off his mortgage. Amoorpour has paid the taxes for the property every year since he purchased the property. ¶8 After purchasing the property, Kirkham and her husband Carl Kirkham (collectively Kirkhams) prevented Amoorpour from entering the property. In 2007, Amoorpour filed this action in district court. The Kirkhams counterclaimed, alleging they had adversely possessed the land for more than 15 years. Amoorpour amended his petition and added a claim against the Welcher Heirs contending that if the Kirkhams prove their adverse possession claim, then the Welcher Heirs breached their warranty of title when they sold the property to Amoorpour. The district court granted a motion for a separate trial to determine Amoorpour's claims against the Welcher Heirs. ¶9 The Kirkhams claimed that they used the property for more than 15 years prior to the 2002 quiet title action. They pastured horses and cows, built fences, dug a pond, and built a baseball backstop on the property. At some point, Mr. Kirkham attempted to pay the taxes for the property. However, an attorney told Mr. Kirkham that Indians owned the property. ¶10 In 2012, Carl Kirkham passed away, and the district court dismissed his claims against Amoorpour. In July 2021, after over ten years of litigation, the district court held a two-day bench trial on Amoorpour's claim for quiet tile2 and Kirkham's counterclaim for adverse possession. The district court granted a directed verdict in favor of Amoorpour, holding that the 2002 quiet title action that awarded title to the Welcher Heirs was dispositive and precluded judgment in favor of Kirkham. ¶11 Three weeks after the trial, Amoorpour filed a writ of assistance. He also filed a motion for damages, requesting the district court to award him rental damages against Kirkham for 196 months of unlawful possession (until July 20, 2022), at $500 per month, equaling $90,000. ¶12 Kirkham responded, arguing that Amoorpour's quiet title claim did not include a claim for a writ of assistance. She also contended that Amoorpour was not entitled to damages because he dismissed his claims for monetary damage before the trial. ¶13 The district court denied Amoorpour's request for damages, concluding that the claim was an alteration to the cause of action by Amoorpour and an attempt to modify his damages claim outlined in the pre-trial order without the court's permission. The district court also denied Amoorpour's request for a writ of assistance, holding Oklahoma law requires Amoorpour to follow additional procedures before the court could issue any writ. ¶14 Kirkham appealed, and Amoorpour counter-appealed. This Court retained the case. ¶15 On appeal, Kirkham claims that she and her husband adversely possessed the land for at least 15 years prior to the 2002 quiet title action. Therefore, the Welcher Heirs should have given her proper notice of or made her a party to the 2002 quiet title action. Kirkham contends the district court erred in holding that the 2002 quiet title action was dispositive of her claim because the action was not valid against her. ¶16 Amoorpour and the Welcher Heirs respond that Kirkham never met the required elements of adverse possession and did not have a claim to title at any point, including when the 2002 quiet title action matter was pending. ¶17 Amoorpour filed a counter-petition in error, claiming that the district court erred in denying his motion for damages and writ of assistance. STANDARD OF REVIEW ¶18 A claim for title by adverse possession is an equitable proceeding. The Court will weigh the evidence presented and affirm the district court's decision unless it is against the clear weight of the evidence or is contrary to law. Akin v. Castleberry, 2012 OK 79, ¶ 11, 286 P.3d 638. ¶19 The issues in this appeal also concern questions of law; the correct standard of review is de novo. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. Under the de novo standard of review, the Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. Id. DISCUSSION A. KIRKHAM DID NOT PROVE TITLE BY ADVERSE POSSESSION UNDER THE FACTS PRESENTED. ¶20 Adverse possession claims are disfavored and are not to be made by inference. Francis v. Rogers, 2001 OK 111, ¶ 13, 40 P.3d 481, 486. In questionable cases, presumptions favor the record title holder. Id.; see also Akin, 2012 OK 79, ¶ 12, 286 P.3d at 641. ¶21 What constitutes adverse possession is a mixed question of law and fact. The law does not attempt to list all the acts of dominion which may constitute such possession. What constitutes adverse possession often depends upon the circumstances of the particular case, as measured by the judgment of reasonable men. Such determination depends upon the situation of the parties, the size of the land, and the purpose for which the claimant uses the land. Anderson v. Hill, 1951 OK 353, ¶ 17, 239 P.2d 1016, 1020. ¶22 A person claiming adverse possession has the burden of proving every element of adverse possession by clear and positive proof. Anderson, 1951 OK 353, ¶ 11, 239 P.2d at 1019. The claimant must show that possession was hostile, under a claim of right or color of title, actual, open, notorious, exclusive, and continuous for the statutory period of 15 years. Akin, 2012 OK 79, ¶ 11, 286 P.3d at 641; Tindle v. Linville 1973 OK 64, ¶ 8, 512 P.3d 176, 178. Keeping this standard in mind, we address whether Kirkham proved each element of adverse possession in turn. I. Kirkham did not continuously possess the property for 15 years. ¶23 Possession of property alone is not sufficient to give title. The possession must be continuous for 15 years. Our Court has explained: [I]t is also essential that such possession, in order, that it may ripen into title, should be shown to be continuous and uninterrupted for the full statutory period. The moment the possession is broken it ceases to be effectual, because, as soon as, and as often as a break occurs, the law restores the constructive possession of the owner. Anderson v. Francis, 1936 OK 312, ¶ 15, 57 P.2d 619, 621. Continuous and uninterrupted use is use that is not disrupted by the act of the owner of the land or by voluntary abandonment by the party adversely claiming the property. Hargraves v. Wilson, 1963 OK 77, ¶ 21, 382 P.2d 736, 740. ¶24 In 1988, the Kirkhams moved into a house located on the property adjacent to the property at issue. They occasionally used an electric hot wire fence on a portion of the disputed property to pasture animals. However, the wire fence was not a permanent fixture. ¶25 In 1992, the Kirkhams built a baseball backstop on the property at issue. They used the backstop in spring and fall until approximately 1999. Mr. Kirkham stored some hay bales on the property during this time and dug a pond to divert water. However, after 1999, the backstop laid dormant and became overgrown with brush. At some point in 2002 or 2003, the Kirkhams placed a t-post and permanent wire fence around one part of the property. Cattle and horses occasionally grazed in this area after they placed the wire fence. ¶26 From a careful examination of the record, there appear to be certain short periods in which Kirkham proved possession of a portion of the property. However, there are many breaks in the continuous statutory period to clearly come within the rule of adverse possession. ¶27 We dealt with a similar issue in Francis, wherein the claimants contended that they adversely possessed and occupied a strip of land by building a fence, farming, and running cattle on the land. 2001 OK 111, ¶ 6, 40 P.3d at 484. However, the evidence presented at trial demonstrated that the claimants only used the land when the trains stopped running on the land, which was six years before the lawsuit. We found that the claimant alleging adverse possession failed to show uninterrupted and continuous possession for 15 years. Id. ¶ 17, 40 P.3d at 486-87. ¶28 At most, the evidence showed continuous use by Kirkham of the property from 1992 until 1999, or 7 years, and from 2002 until 2007, or 5 years. There is no evidence of continuous use of the property from 1988 to 1992 or from 1999 until 2002. We hold that Kirkham did not have continuous and uninterrupted possession for a period of 15 years prior to the 2002 quiet title action or when Amoorpour filed this lawsuit. II. Kirkham did not have exclusive and hostile possession of the property for 15 years. ¶29 For adverse possession to ripen into prescriptive title must also be exclusive and notorious. Collins v. Smith, 1962 OK 128, ¶ 18, 372 P.2d 878, 881 (noting that for exclusive possession one must show "exclusive dominion over the land and an appropriation of it to his own use and benefit"). Here, other individuals entered onto the property to practice baseball and ride motorcycles or four runners. Other individuals dumped trash on the property and parked on the property. Kirkham never effectively enclosed the disputed area in this case. Instead, the land was vacant and accessible to any number of people. The use of a vacant field for baseball practice or riding vehicles does not rise to the level of a claim and use of land that is adverse possession. If we ruled otherwise, vacant lots and fields would be subject to claims for title. The evidence supports the conclusion that other individuals shared possession of the disputed property during the adverse possession period. Diem v. Diem, 1962 OK 124, ¶ 12, 372 P.2d 19, 23. And common access to the disputed tract erodes Kirkham's claims of exclusive possession of the property. ¶30 Further, hostile possession, taking the property as if it was hers, can be gathered only from acts and declarations of the claimant. Norman v. Smedley, 1961 OK 143, ¶ 13, 363 P.2d 839, 842. Kirkham's actions and declarations cannot be considered hostile. For example, in February 1998, the Kirkhams did not list the property in Mr. Kirkham's bankruptcy filings. Although only Mr. Kirkham filed for bankruptcy, these filings are relevant in that Kirkham testified that she is claiming the same interest in the property as Mr. Kirkham did before his death. Mr. Kirkham did not disclose any interest in the subject property although he was to list all his legal or equitable interests in the property at the commencement of the bankruptcy case, including any interest that is legal, equitable, vested, contingent, non-possessory, present, or arising in the future. In re Dittmar, 618 F.3d 1199, 1207 (10th Cir. 2010). Mr. Kirkham admittingly did not list the property in his bankruptcy because he did not believe he had title to the property; the same is true for Kirkham. Because the Kirkhams did not claim title to the property in 1998, there is no clear and positive proof that their possession was hostile for 15 years prior to the filing of this action in 2007. III. Kirkham did not openly and notoriously possess the land for 15 years. ¶31 Adverse possession must also notify parties seeking information that a premises is not held in subordination to any title or claim of another but against all titles and claimants. Davis v. Manhard, 1935 OK 484, ¶ 16, 45 P.2d 1095, 1097. The claimant doing such acts must indicate in an open, public, and visible manner that the claimant has control over the land. Hair v. City of Norman, 1963 OK 291, ¶¶ 19-22, 389 P.2d 634, 637. ¶32 The evidence presented by the parties was that the Welcher Heirs visited the property at least twice during the time that the Kirkhams adversely possessed the property and did not see evidence of possession by the Kirkhams. When the Welcher heirs decided to sell the property, their realtor and a surveyor went to the property and did not see any evidence of possession of the property by the Kirkhams. Kirkham saw "For Sale" signs located on the property in 2005. However, she did not inquire as to who was selling the property or claim ownership of the property at that time. ¶33 Amoorpour also visited the property twice prior to purchasing it. The first time he saw some cows on a portion of the property. The second time Amoorpour spoke with Mr. Kirkham, who relayed to him that certain Indians owned the land. Mr. Kirkham did not claim ownership of the property at that time. Kirkham also admitted that she knew that certain Indians owned the property. ¶34 The evidence presented of Kirkham's use was insufficient to put the Welcher Heirs and Amoorpour--a prospective purchaser--on notice that Kirkham was in adverse possession. ¶35 Further, in Shanks v. Collins, 1989 OK 115, ¶ 18, 782 P.2d 1352, 1355, we held that a claimant did not adversely possess the disputed property because, by his own testimony, the claimant knew that another had actual title to the property long before the statutory period had expired. The district court concluded that these facts constituted the claimant's acknowledgment of title in the true owner. We agreed and reiterated that acknowledgment by an adverse possessor of title in another is evidence tending to show that his claim was not truly adverse. We also noted that recognition by an adverse possessor that legal title belongs to someone else serves to break the essential element of continuity of possession. Id.; see, e.g., Coats v. Riley, 1931 OK 758, 7 P.2d 644; Honeyman v. Andrew, 1926 OK 968, 253 P. 489. The acknowledgment in this case that certain Indians owned the land weakened Kirkham's claim of adverse possession. IV. Kirkham did not have possession under a claim of right or color of title for 15 years. ¶36 The subject property had interests by individuals who were members of the Five Civilized Tribes, restricting the transfer of the property. Adverse possession does not run against the public lands of the government, nor does it run against the land of Indian tribes. St. Louis & S.F. Ry. v. McBride, 1924 OK 1066, ¶ 8, 231 P. 284, 287. Therefore, the Kirkhams would have had to remove these restrictions from the land prior to claiming that their title ripened through adverse possession. The Welcher Heirs did this as part of their 2002 quiet title action, issuing notice to the Bureau of Indian Affairs. Until the district court quieted title to the Welcher Heirs, the land was subject to restrictions, and the title could not ripen through adverse possession. ¶37 In this case, Kirkham did not provide clear and positive proof of continuous, open, notorious, exclusive, and hostile possession. Francis, 2001 OK 111, ¶ 13, 40 P.3d at 486. Kirkham had the burden to satisfy each element of possession in support of her claim. Mason v. Evans, 1965 OK 173, ¶ 41, 410 P.2d 534, 540. Kirkham's ownership claim does not reconcile with the ever-changing ebb and flow of influence over the property at issue, with fixtures that came and went and pieces of fence that never encircled the property. Kirkham's actions were at times ambiguous and lacked clear and positive proof. For these reasons, the district court correctly quieted title to Amoorpour. B. THE WELCHER HEIRS GAVE PROPER NOTICE TO KIRKHAM REGARDING THE 2002 QUIET TITLE ACTION. ¶38 A quiet title action is to determine the actual owner of a property and put any adverse claims to rest. Schultz v. Evans, 1951 OK 61, ¶ 13, 228 P.2d 626, 628. Service by publication is proper for a quiet title action.3 ¶39 In 2002, the Welcher Heirs filed a quiet title action in McClain County to resolve ownership and chain of title deficiencies regarding the property at issue. The Welcher Heirs attempted to give actual notice to all persons in the recorded chain of ownership and constructive notice to any unknown other persons. The Welcher Heirs published notice three times (October 10, 2002, October 17, 2002, and October 24, 2002). The Welcher Heirs also gave notice to the Bureau of Indian Affairs. Following proper notice and approval by the Bureau of Indian Affairs, the district court quieted title to the Welcher Heirs. ¶40 Kirkham could not prove adverse possession at the time the Welcher Heirs filed the 2002 quiet title action in the same way she cannot prove it in this matter. She had the same legal right to notice or due process as any other person attempting to claim title to the property without any legal interest. Kirkham received constructive notice of the quiet title action, and it was proper. ¶41 Despite the 2002 quiet title action, the law permitted Kirkham to bring her counterclaim for adverse possession in this matter. The district court in the 2002 quiet title action had jurisdiction over the parties to the action, and the purpose of that action was to litigate and determine title to the parties in the case. Schultz, 1951 OK 61, ¶ 13, 228 P.2d at 628. Kirkham and Amoorpour were not parties to that case, and the prior judgment did not bar Kirkham from bringing her counterclaim for adverse possession against Amoorpour. See Atl. Richfield Co. v. Tomlinson, 1993 OK 106, ¶ 33, 859 P.2d 1088, 1097 (holding a prior quiet title action did not preclude a later quiet title suit brought by individuals who were not parties to the original suit). The 2002 quiet title action had no bearing on this action except that it quieted title to the Welcher Heirs, which in turn allowed them to transfer the property to Amoorpour. And the district court then properly quieted title to Amoorpour.4 C. THE DISTRICT COURT CORRECTLY CONCLUDED THAT AMOORPOUR WAS NOT ALLOWED MONEY DAMAGES AS PART OF HIS CLAIM. ¶42 The district court properly denied Amoorpour's motion for damages because he did not have a claim for money damages pending at trial. After the pre-trial conference but before the bench trial, Amoorpour filed a partial dismissal with prejudice as to all claims except for quiet title. The district court determined the quiet title claim at trial without awarding any damages to Amoorpour. Three weeks later, Amoorpour filed a motion for damages. ¶43 An action for quiet title on its own does not provide for a monetary award of damages. Schultz, 1951 OK 61, ¶ 13, 228 P.2d at 628. Instead, the purpose is to determine the real owner of the property. Id. Amoorpour had no claim for money damages pending at the time of trial. ¶44 Further, Amoorpour's damages were uncertain and speculative, and Oklahoma law prohibits recovery of damages that are uncertain and speculative. See Great Western Motor Lines, Inc. v. Cozard, 1966 OK 134, ¶ 8, 417 P.2d 575, 578. The only evidence Amoorpour presented of his damages was one statement during his testimony at trial as to the rental value of the property without any testimony as to how he arrived at the rental value. Even more, Amoorpour's damages are speculative because he claims that Kirkham never continuously possessed the entire property. The district court correctly denied Amoorpour's motion for damages. D. THE DISTRICT COURT ERRED IN NOT GRANTING AMOORPOUR'S WRIT OF ASSISTANCE. ¶45 The district court had jurisdiction over the property at issue and had the power to issue a writ of assistance after it determined and settled the parties' title to the property. 6 Am. Jur. 2d Assistance, Writ of § 4 (2023). Yet the district court denied Amoorpour's request for a writ of assistance. Relying on Wishon v. Sanders, 2020 OK CIV APP 29, 467 P.3d 721, the district court concluded that Oklahoma law required Amoorpour to take additional steps after having title quieted to obtain possession. However, in Wishon, the quiet title action occurred in 2011, and the title holder appealed an order from the district court denying her motion for a writ of assistance almost ten years after the court quieted the title. Id. ¶ 1, 467 P.3d at 722. The Court of Civil Appeals denied the title holder's request, concluding that the parties did not properly plead or litigate possession in the 2011 quiet title matter. Id. ¶ 14, 467 P.3d at 725. ¶46 The Wishon case is distinguishable from this matter because the parties in this case litigated possession. The common issues litigated for possession are (1) the title of the plaintiff; (2) the present right of possession; and (3) the wrongful possession of the defendant. Gentry v. McCurry, 1928 OK 733, ¶ 3, 273 P. 222, 223. The claimant must first prove a regular chain of title and show all deeds or other evidence of title. 12 O.S.2021, § 1142; see also Cook v. Hammett, 1943 OK 114, ¶ 7, 135 P.2d 962, 964. ¶47 At trial, the district court heard testimony and took judicial notice of the chain of title, and the evidence was clear and uncontroverted. In 1939, Alexander Welcher, Sr. obtained ownership of the property through a resale tax deed. In 1993, Alexander Welcher, Sr. was presumed deceased, and the Welcher Heirs inherited the property. In 2002, the Welcher Heirs sought to quiet title to the property and became record owners of the property. In May 2005, Amoorpour purchased the property, and the Welcher Heirs deeded the property to him. Amoorpour was the record title holder when he filed this lawsuit. However, Kirkham would not allow him to possess the property. Kirkham failed to establish adverse possession and has wrongfully possessed the property. ¶48 Kirkham claims that the district court properly denied Amoorpour's request for a writ because he did not plead such action. However, this Court has construed claims of quiet title as claims for recovery of property. In Krosmico v. Pettit, 1998 OK 90, 968 P.2d 345, a claimant brought a suit claiming adverse possession. The title holder to the property counterclaimed, requesting the court to quiet title. We recognized that the title holder's counterclaim for quiet title was more properly characterized as one for ejectment as the title holder had the title to the property and was attempting to possess the property. Id. ¶ 2 n.1, 968 P.2d at 346 n.1. Here, Amoorpour held title to the property and brought this matter because Kirkham denied him possession of the property. Although the district court had to determine Kirkham's adverse possession claim, Amoorpour was ultimately seeking possession of the property. The district court resolved the issues regarding who was entitled to possession and therefore had the power to issue a writ of assistance. We reverse the district court's denial of Amoorpour's writ of assistance. CONCLUSION ¶49 Based upon our analysis, we affirm the district court's rulings to quiet title to Amoorpour and to deny his motion for damages. We reverse the district court's ruling denying Amoorpour's request for a writ of assistance. We remand for proceedings consistent with this opinion.5 DISTRICT COURT'S JUDGMENT AFFIRMED IN PART AND REVERSED IN PART; REMANDED WITH INSTRUCTIONS. ALL JUSTICES CONCUR. FOOTNOTES 1 Mohammad Amoorpour filed this matter in district court as the sole record titleholder in the case. On July 15, 2015, Mohammad Amoorpour deeded his interest in the subject property to Mohammad Amoorpour and Maryam Amnifar, Trustees of the Amoorpour Family Trust. The district court substituted the parties on March 7, 2018. However, we refer to Amoorpour as an individual throughout the opinion since the facts relating to the matter involve him acting as an individual. 2 Prior to trial, Amoorpour dismissed every claim against Kirkham except for his claim for quiet title. 3 Title 12 O.S.2021, § 2004(B)(3)(c)(3) states: (3) In an action to quiet title to real property, it is not necessary for the publication notice to state the nature of the claim or interest of either party, and in describing the nature of the judgment that will be rendered should the defendant fail to answer, it is sufficient to state that a decree quieting plaintiff's title to the described property will be entered. It is not necessary to state that a decree forever barring the defendant from asserting any interest in or to the property is sought or will be entered if the defendant does not answer. 4 We note that "a legally correct nisi prius judgment must be affirmed although it was anchored to a theory different from that on which it comes to be tested on appellate review" when the different theory is adequately supported by the record. Farley v. City of Claremore, 2020 OK 30, ¶ 19, 465 P.3d 1213, 1225. 5 On December 19, 2022, Appellees/Counter-Appellants filed a request for this Court to strike Proposition C of Kirkham's Answer Brief. They argued that Kirkham violated the rules of appellate procedure by attempting to correct her failure in Proposition C to provide citations to the record. The Court entered an order stating that consideration of Appellees/Counter-Appellants' motion was deferred until the decisional stage of this appeal. We do not find a violation of any rule of appellate procedure and deny the motion to strike.

5078716a-e10f-4682-99fc-766c31d1149d

Scott v. Foster

oklahoma

Oklahoma Supreme Court

Scott v. Foster2023 OK 112Case Number: 118267Decided: 11/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. Derrick R. Scott, Petitioner/Appellant,v.Candice J. Foster, Respondent/Appellee. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION II ¶0 Petitioner, Derrick R. Scott, filed a petition to establish paternity. Respondent, Mother, Candice J. Foster filed a motion to dismiss, asserting that title 10, section 7700-609(B) requires a party to commence an adjudication of paternity within two years of an acknowledgment of paternity. The Blaine County District Court granted Mother's motion to dismiss and ordered Petitioner to pay substantial attorney fees. Petitioner appealed and the Court of Civil Appeals affirmed in part and reversed in part, overturning the district court's order regarding attorney fees. This Court previously granted certiorari to address whether the Court of Civil Appeals properly affirmed the district court in dismissing Petitioner's claim. We answer now in the negative. COURT OF CIVIL APPEALS OPINION VACATED IN PART,DISTRICT COURT REVERSED, ANDCASE REMANDED FOR FURTHER PROCEEDINGS. Eric N. Edwards, Eric N. Edwards, P.C., Enid, Oklahoma, for Petitioner/Appellant, Derrick R. Scott. Maria Tully Erbar, Oklahoma City, Oklahoma, for Respondent/Appellee, Candice J. Foster. OPINION DARBY, J., ¶1 The question before this Court is whether the Court of Civil Appeals properly affirmed the district court in dismissing Derrick R. Scott's petition. We answer in the negative. Neither party requested certiorari review on the issue of attorney fees, so that portion of the opinion remains intact.1 I. BACKGROUND AND PROCEDURAL HISTORY ¶2 Scott and Candice J. Foster, Mother, had a physical relationship at an unspecified time. Following which, in February 2013, Mother gave birth to Child. At that time, Mother was not married. Eight days after Child's birth, the acknowledged father2 signed an Acknowledgment of Paternity. According to the Acknowledgment of Paternity, no genetic testing was done at that time to determine paternity. ¶3 This case began on January 10, 2019, when Scott filed a petition requesting an adjudication of paternity over Child. On February 19, 2019, Mother filed an Answer and Motion to Dismiss Or Alternatively, Motion for Summary Judgment. ¶4 Mother denied that Scott is Child's father. Mother noted that Child has an acknowledged father3 and asserted that Scott failed to state a claim upon which relief could be granted because Scott was statutorily barred from seeking an adjudication of paternity at the present time, pursuant to title 10, section 7700-609(B).4 Mother argued that section 7700-609(B) required Scott to commence a paternity action within two years from the date of the acknowledgment of paternity and cited to Paul v. Williamson, 2014 OK CIV APP 31, 332 P.3d 1070, for finding a claim to be time-barred when filed more than two years after the acknowledgment of paternity. Mother also requested the court grant summary judgment based on her submitted evidentiary materials. Mother filed an Affidavit asserting that: (1) she is Child's mother, (2) Scott had never signed Child's birth certificate or an acknowledgment of paternity, (3) Child has an acknowledged father who had acknowledged paternity in March 2013, and (4) she was filing a Motion for a Protective Order under which she would later file a certified copy of the Acknowledgment of Paternity. On March 4, 2019, the trial court filed a court minute noting that the Acknowledgment of Paternity was filed under seal.5 On March 6, 2019, DHS filed a disclaimer of interest in the proceeding, stating that DHS was not providing child support services to the benefit of Child in this case and would not be involved in the case. ¶5 In response, on March 6, 2019, Scott argued that Mother failed to verify her pleading and noted that Mother had failed to state under oath, in her affidavit, that Scott is not the biological father of the child. Scott stated that he was also incorporating the petition from another Blaine County case, CV 2018-59, in which Mother filed a Petition for Change of Name of Child on August 6, 2018; Scott noted that he did not receive notice of that proceeding, but that within the petition Mother stated Petitioner and the minor child desire that the minor child's family name be changed to that of the family of the mother as requested above for the reason that father, [Acknowledged Father], provides no financial, temporal nor moral support for the child. He has had no personal contact or visitation with the child since February of 2013. Scott argued that by way of this statement in the pleading, Mother recognized that the acknowledged father is not Child's biological father. Scott further asserted that he is Child's father and demanded a paternity test to confirm. Scott alleged that the acknowledged father was excluded as Child's father by genetic testing performed within two years of Child's birth and requested Mother or DHS must produce the results. Scott also alleged that Mother knew that Scott was Child's biological father and committed fraud when she signed the Acknowledgment of Paternity, naming another man as father. Scott further asserted that Mother informed him that the acknowledged father "was not the father and that he [Scott] was the only other man who could be the child's father." Pet. Resp. at 6. Scott requested discovery due to all the disputed questions of fact and requested appointment of a guardian ad litem. Scott did not attach any exhibits to his response. ¶6 Mother filed a motion to strike, wherein she requested the district court strike Scott's factual allegations regarding genetic testing and Mother's alleged acknowledgment to Scott that the acknowledged father is not Child's biological father. Scott responded at length that the motion was untenable and must be denied. ¶7 On May 9, 2019, Scott filed a supplemental response reasserting his request for a guardian ad litem and for the first time claiming that the Uniform Parental Act (UPA), as written and applied, clearly violates his 1st and 14th Amendment rights under the U.S. Constitution. Scott claimed that Mother's motion to dismiss seeks a de facto termination of his parental rights. For the first time, Scott also argued that he attempted to submit for genetic testing within the first two years of Child's life, but was denied because of the Acknowledgment of Paternity signed by another man. Scott argued that the DHS form for an Acknowledgment of Paternity allows an unwed mother to commit fraud by having a man other than the biological father sign it, thereby preventing the true biological father from signing an Acknowledgment. Scott also claimed that the UPA violated Child's rights because the UPA requires a paternity action to be filed within two years of birth, but title 12, section 95 allows married parents to file paternity and support actions until a child turns 18, with the child allowed to initiate legal proceedings even later under title 10, section 7700-606. He further argued the UPA discriminates against putative fathers as a mother may agree to testing at any time, but a biological father who is not a presumed father is barred from doing so after two years. ¶8 On June 7, 2019, Scott filed a notice to take Mother's deposition on June 25. On June 17, Mother filed a motion to quash the deposition subpoena. She noted that the statute of limitations had run and the hearing on the motion to dismiss was scheduled for June 21. Scott stated Mother was pleading the affirmative defense of the special statute of limitations under the UPA, contrary to title 12, section 95 (A)(8)-(9), and cited to numerous cases stating that a party who wrongfully conceals may not take advantage of their own wrong by pleading the statute of limitations and that questions of discovery of fraud are a question of fact for statute of limitations purposes. He argued that the UPA violated Equal Protection by applying a different statute of limitation to paternity cases arising out of wedlock. ¶9 On June 21, 2019, the district court held a hearing on the motion to dismiss. The judge almost immediately indicated the issue looks to me like is title 10 section 7700-609(b), a statute of limitations or statute of repose. And I believe the law indicates it's a statute of repose and therefore there's no cause of action that exists, so the motion to dismiss is granted. Tr. of Procs. 3:8-13 (June 21, 2019). Counsel for Scott requested to be heard and the following discourse took place: Counsel: I intended to ask the Court for an order allowing this to be certified for immediate appeal. Court: I- - I would take this as a final order, so I think you have an absolute right to appeal, Mr. Edwards. Counsel: I just - - and this is with respect. I just want the record to be clear that we, as reflected in the court file, intended to present evidence in support of our motion as to the fraud claim. I don't believe with respect that the respondent briefed this is a statute of repose. That's the first, you know, indication in the case that I thought that issue was - - I think both of us argued the statute of limitations issue. I certainly would have, you know, liked the opportunity to brief that. If the record goes up on accelerated appeal like a motion for summary judgment, you know, we're not going to have that issue fully briefed. We - - we - - as we stated in our motions, the Court's read those, I'm not trying to argue with your ruling, but we did respectfully submit those. Because of the fraud issue, we should have been allowed to take the deposition of the respondent. Your ruling obviously prevents that from happening next week. Court: Yes, sir. Id., at 4:17-5:20. Counsel again spoke up to say: Counsel: I just wanted the record to be clear that we - - we felt from a proffer standpoint that we could clearly prove a fraud cause of action and that the statute that the Court alluded to did specifically address areas where that affidavit of paternity can be set aside due to fraud. So I just want to make sure that we're not going to procedurally make a mistake as far as this being interlocutory or a final because - - Court: I don't see how it could be interlocutory because from my perspective the case is over with this ruling. Counsel: Just specifically because the Court feels that it's a statute of repose - - Court: Correct. Counsel: - - under the UPA - - Court: Yes Counsel: -- and not - - okay. Because I didn't see that in my cases that's why I'm - - Court: Okay. Well, thank you. We'll be adjourned. Id., at 6:25-7:22. The journal entry filed on August 23, 2019 states "that Title 10, Section 7700-609B is a statute of repose, and therefore no cause of action exists. Accordingly, the motion to dismiss filed by the Respondent should be granted." ¶10 Scott filed a petition in error on September 23, 2019 in which he stated the issues on appeal were whether the trial court erred in granting Mother's motion to dismiss, whether title 10, section 7700-609(B) is a statute of repose or statute of limitation subject to equitable tolling and other defenses, whether the Uniform Parentage Act, including section 7700-609(B) is unconstitutional on its face or as applied in this case, whether the trial court erred in failing to appoint a guardian ad litem, whether the district court's ruling deprived Scott or Mother of due process, whether the DHS forms for Acknowledgment of Paternity are unconstitutional under the First and Fourteenth Amendments to the United States Constitution, and whether the Acknowledgment of Paternity in this case is void or voidable under these facts. On January 8, 2020, the appeal was assigned to the Court of Civil Appeals, Division II. On February 6, 2020, Scott filed an amended petition in error wherein he added the issue of whether the district court erred in granting Mother's application for attorney fees and whether the amount awarded was excessive under the circumstances. ¶11 On April 21, 2020, Scott filed a Motion to Stay Appeal Pending Trial Court's Ruling on Petition to Vacate and For New Trial and to Supplement Record on Accelerated Appeal.6 On June 10, 2020, the Court of Civil Appeals granted the stay and remanded the case for consideration of the motion to vacate.7 On March 2, 2022, the Court of Civil Appeals lifted the stay filed in this case and stated the appeal would proceed.8 ¶12 On June 16, 2022, the Court of Civil Appeals affirmed the district court in part and reversed the district court in part, overturning the district court's grant of attorney fees. The Court of Civil Appeals declared the first issue was whether the district court erred in granting Mother's motion to dismiss the paternity petition based on the trial court's reading of title 10, section 7700-609(B) as a statute of repose. The court then set out the statute and stated in full on this issue: We join the district court and another division of this Court, see Paul v. Williamson, 2014 OK CIV APP 31, ¶ 8, 322 P.3d 1070, in interpreting this statute to cut off completely any ability of a putative father to seek a paternity adjudication more than two years after an AOP is signed, i.e., § 7700-609(B) is a statute of repose as opposed to a statute of limitations. See Reynolds v. Porter, 1988 OK 88, ¶¶ 6-7, 760 P.2d 816, 820 (explaining the difference between the two statute types). Because it is undisputed that Scott filed his petition in January 2019, nearly six years after the relevant AOP was signed, the trial court properly entered judgment. COCA Op. 6 (emphasis original). The court next addressed Scott's arguments that section 7700-609(B) could be tolled and found no support for that argument. Finally, the court addressed Scott's constitutional challenges and found them also unsustainable. ¶13 On July 1, 2022, Scott filed a petition for rehearing.9 The Court of Civil Appeals denied the petition for rehearing the same day. This Court granted Scott's petition for certiorari review regarding the portion of the opinion wherein the court affirmed the district court's dismissal. II. STANDARD OF REVIEW ¶14 We review a district court's dismissal of an action under a de novo standard. Video Gaming Techs. v. Tulsa Cty. Bd. of Tax Roll Corrs., 2019 OK 84, ¶ 2, 455 P.3d 918, 919. "A petition can generally be dismissed only for absence of any cognizable legal theory to support the claim or for insufficient facts under a cognizable legal theory." Rogers v. Quiktrip Corp., 2010 OK 3, ¶ 4, 230 P.3d 853, 856. While the district court stated it granted the motion to dismiss, the court relied on Mother's submitted evidence, making the order one of summary judgment. Like dismissal, summary judgment settles only questions of law, therefore, we also review it de novo. Toch, LLC v. City of Tulsa, 2020 OK 81, ¶ 15, 474 P.3d 859, 865. If it appears that there is no substantial issue of material fact and that one party, including the non-moving party, is entitled to judgment as a matter of law, a court shall render judgment for that party and an appellate court will affirm. R. for Dist. Courts of Okla., 12 O.S.2011, ch. 2, app., R. 13(e); see also Fraternal Order of Police v. City of Norman, 2021 OK 20, ¶ 2, 489 P.3d 20, 22. If a party is not entitled to judgment as a matter of law, then summary judgment will be reversed. Toch, 2020 OK 81, ¶ 15, 474 P.3d, at 865. Under this standard, we confine our review to the limited, undisputed, material facts. Frey v. Independence Fire & Cas. Co., 1985 OK 25, ¶ 6, 698 P.2d 17, 20. III. ANALYSIS ¶15 Based on the record before us, the dispositive legal question is whether title 10, section 7700-609(B) is a statute of repose or a statute of limitation subject to discovery, equitable tolling, or estoppel.10 "[A] statute of limitation merely extinguishes the plaintiff's remedy while a statute of repose bars a cause of action before it arises." Reynolds v. Porter, 1988 OK 88, ¶ 6, 760 P.2d 816, 820. Or, "[i]n practical terms, a statute of repose marks the boundary of a substantive right whereas a statute of limitation interposes itself only procedurally to bar the remedy after a substantive right has vested." Ibid.; see also Consol. Grain & Barge Co. v. Structural Sys., Inc., 2009 OK 14, ¶ 8, 212 P.3d 1168, 1171. ¶16 "There were no statutes of limitations at common law; they are creatures of statutes." Lake v. Lietch, 1976 OK 45, ¶ 13, 550 P.2d 935, 937. "Because there is a strong policy in Oklahoma against unwarranted modification of statutory limitations, we must first determine whether" section 7700-609 "is a statute of limitation or a statute of repose." See Reynolds, 1988 OK 88, ¶ 6, 760 P.2d, at 819. Section 7700-609 states: A. If a child has an acknowledged father, a signatory to the acknowledgment of paternity may commence a proceeding seeking to challenge the paternity of the child only within the time allowed under Section 15 or 16 of this act. B. If a child has an acknowledged father or an adjudicated father, an individual, other than the child, who is neither a signatory to the acknowledgment of paternity nor a party to the adjudication and who seeks an adjudication of paternity of the child shall commence a proceeding not later than two (2) years after the effective date of the acknowledgment or adjudication. C. A proceeding under this section is subject to the application of Section 16 of this act. 10 O.S.2011, § 7700-609. This Court has not yet addressed which type of statutory time bar section 7700-609(B) is, but we do so today. ¶17 When this Court answers questions of statutory interpretation, our primary goal is to ascertain and follow the intent of the Oklahoma Legislature. See Toch, 2020 OK 81, ¶ 21, 474 P.3d, at 866. In seeking the Legislature's intent, we "may look at each part of the statute, other statutes on the same subject, and the consequences of any particular interpretation." Id., ¶ 22, 474 P.3d, at 866. "It is well settled that subsequent amendments to an act can be used to ascertain the meaning of the prior statute." Cloudi Mornings, LLC. v. City of Broken Arrow, 2019 OK 75, ¶ 18, 454 P.3d 753, 759; Quail Creek Golf & Country Club v. Okla. Tax Comm'n, 1996 OK 35, ¶¶ 9-11, 913 P.2d 302, 304. "Where the meaning of a prior statute is subject to serious doubt and has not been judicially determined, a presumption arises that a subsequent amendment was meant to clarify, as opposed to change, the prior statute." Cloudi Mornings, 2019 OK 75, ¶ 18, 454 P.3d, at 759. "A subsequent statute clarifying a prior statute can be used to determine the meaning of the prior statute even if the interpretation affects alleged vested rights." Ibid. ¶18 Prior to enactment of the UPA, this Court addressed a paternity challenge based on a mother's alleged fraud in signing a statement acknowledging paternity. Hill v. Blevins, 2005 OK 11, 109 P.3d 332. The Court noted that under the law at the time, a statement acknowledging paternity had the same legal effect as an order of paternity entered in a court proceeding. Id., at ¶ 8, 109 P.3d, at 335; see 10 O.S. Supp. 2004, § 70(B)(1). The putative father in Hill requested the district court vacate the acknowledgment of paternity pursuant to 12 O.S.2001, § 1031(4), which required that proceedings to vacate an order must be commenced within two years from when it was entered. The Court noted that: "The complaining party need not have actual notice of the fraud. Constructive notice of fraud from public records, required by law to be kept, is sufficient to set the statute of limitations in motion." Hill, 2005 OK 11, ¶ 10, 109 P.3d, at 335. The Court found the alleged father had knowledge of a positive pregnancy test on a specific date and as a result was chargeable with the knowledge that a positive pregnancy test was followed by the birth of a child, issuance of a birth certificate, and potential matters of support or visitation. Id., at ¶ 11, 109 P.3d, at 335--36. But the alleged father waited until the child was almost six years old to file suit. Ibid. The Court found that because the means for discovering Mother's alleged fraud were available earlier, the case was time barred. Id., 109 P.3d, at 336. ¶19 In 2006, the Oklahoma Legislature adopted the Uniform Parentage Act. See 2006 Okla. Sess. Laws ch. 116, section 42, HB 2967. Contained within the UPA, section 7700-609 has three parts. Subsection A allows signors of the acknowledgment of paternity to commence a proceeding to challenge the paternity of the child within the time allowed under section 15 or section 16 of the act. Sections 15 and 16 are references to the section numbers used in the enacting bill, HB 2967. See 2006 Okla. Sess. Laws ch. 116. Section 15 is a reference to the law codified at title 10, section 7700-307. Section 16 is a reference to the law codified at title 10, section 7700-308. The district court relied on subsection B of 7700-609, this section allows an individual who did not sign an acknowledgment of paternity to commence paternity proceedings not later than two years from the effective date of the acknowledgment of paternity. Finally, subsection C states that "a proceeding under this section is subject to the application of section 16 of this Act." Again, section 16 is a reference to section 7700-308. At the time of enactment, section 7700-308 stated that after the period of rescission allowed in section 7700-307, signors to the acknowledgment of paternity could commence a proceeding to challenge the acknowledgment only on the basis of fraud, duress, or material mistake of fact and within two years after the acknowledgment was executed. ¶20 The relationship between a parent and child is a fundamental right. See In re S.J.W., 2023 OK 49, ¶ 26, ___ P.3d __; see also In re Chad S., 1978 OK 94, ¶ 12, 580 P.2d 983, 985. The United States Supreme Court has noted that it is "'plain beyond the need for multiple citation' that a natural parent's 'desire for and right to "the companionship, care, custody, and management of his or her children"' is an interest far more precious than any property right." Santosky v. Kramer, 455 U.S. 745, 758--59, 102 S. Ct. 1388, 1397, 71 L. Ed. 2d 599 (1982) (quoting Lassiter v. Dep't of Social Servs. of Durham Cty., N.C., 452 U.S. 18, 27, 101 S. Ct. 2153, 2160, 68 L. Ed. 2d 640 (1981)). As such, it is unreasonable that the Legislature, through section 7700-609(B) would extinguish a putative father's paternity rights before he could reasonably discover the possibility that he was a father. Rather, it is reasonable to construe section 7700-609 to be a statute of limitations subject to exceptions. In determining the timeliness of an alleged cause of action, we have previously stated the legislative policy in prescribing a period of limitations for the commencement of actions may well be borne in mind. The statute of limitations is a statute of repose, enacted as a matter of public policy to fix a limit within which an action must be brought, or the obligation is presumed to have been paid, and is intended to run against those who are neglectful of their rights, and who fail to use reasonable and proper diligence in the enforcement thereof. The underlying purpose of statutes of limitations is to prevent the unexpected effort at enforcement of stale claims concerning which persons interested have been thrown off their guard by want of prosecution for a long time. Seitz v. Jones, 1961 OK 283, ¶ 11, 370 P.2d 300, 302. Construing section 7700-609 as a statute of limitation subject to exceptions follows the legislative policy of protecting fundamental parental rights. Construing section 7700-609 as a statute of repose, on the other hand, would lead to absurd consequences in those situations where a mother intentionally misrepresents material facts regarding their pregnancy, childbirth, or the paternity of the child, that could not have been discovered with reasonable diligence and as a result, the putative father would lose all possibility of a relationship with his child while the mother received the benefit of her misbehavior. See Wylie v. Chesser, 2007 OK 81, ¶ 19, 173 P.3d 64, 71. That construction is not congruent with a legislative intent for the statute to run against one who is neglectful of his rights and allows mothers who commit fraudulent activity to benefit from the delay in onset of proceedings due to their own intentional misrepresentation of material facts. ¶21 The original version of the UPA did not explicitly state whether the Legislature intended it to operate as a statute of repose or one of limitations. And there has been no precedential judicial determination11 regarding whether a putative father could challenge a determination of paternity more than two years after the acknowledgment was signed, but within less then two years of learning of fraud. But since this case originated, the Oklahoma Legislature amended title 10, section 7700-308,12 regarding proceedings to challenge acknowledgment or denial of paternity, and section 7700-607(D),13 regarding limitations of actions in proceedings to adjudicate parentage, in order to clarify applicable limitation periods for actions challenging paternity that involve fraud.14 Although the district court was not bound by the amendments of sections 7700-308 and 7700-607 which did not go into effect until after the court's order was filed, we are permitted to review them in order to better understand the intent of the Legislature and the meaning of section 7700-609. ¶22 The recent amendments to the UPA recognize the fundamental nature of the parent-child relationship and safeguard its status. Section 7700-607(D), as recently enacted, applies to situations such as the one Scott has alleged here. It allows an acknowledged, presumed, or putative father the ability to challenge an acknowledgment of paternity at any time before the child is 18 on the basis of fraud. Where a mother intentionally misrepresents a material fact that could not be discovered with reasonable diligence, these amendments clearly allow a putative father the opportunity, until the child is an adult, to discover those actions before his parent-child relationship is effectively terminated without any notice to him. The recent statutory amendments to the UPA clarify that the Legislature intended section 7700-609 is a statute of limitations subject to exceptions. See Quail Creek Golf & Country Club, 1996 OK 35, ¶¶ 9-11, 913 P.2d, at 304; see also Cloudi Mornings, 2019 OK 75, ¶ 18, 454 P.3d, at 759. We hold that title 10, section 7700-609 is a statute of limitations subject to exceptions. ¶23 Contrary to COCA's recitation of the "undisputed facts before the court," the record does not show that Scott firmly believed that he was the biological father when Child was born. See contra COCA op. 10. Rather, the record before this Court fails to show when the relationship between Scott and Mother actually took place or concluded, when Scott learned of Mother's pregnancy or childbirth, when he first thought that he was Child's father, when he became aware of the Acknowledgment of Paternity, or when he came to believe Mother committed fraud. The district court erred in granting summary judgment based on its determination that section 7700-609 is a statute of repose and erred in dismissing Scott's claim. IV. CONCLUSION ¶24 The opinion of the Court of Civil Appeals is vacated in part and the trial court is reversed. We need not reach the other issues before us. This matter is remanded to the district court. COURT OF CIVIL APPEALS OPINION VACATED IN PART,DISTRICT COURT REVERSED, ANDCASE REMANDED FOR FURTHER PROCEEDINGS. Kane, C.J. (with separate writing), Kauger, Winchester, Edmondson, Combs, Gurich (with separate writing), and Darby, JJ., concurring; Rowe, V.C.J. (with separate writing) and Kuehn (with separate writing), J., dissenting. FOOTNOTES 1 "Issues not presented in the petition for certiorari will not be considered by the Supreme Court." Hough v. Leonard, 1993 OK 112, ¶ 16, 867 P.2d 438, 446 (quoting Okla. Sup. Ct. R. 3.15(A)). 2 "For purposes of the Uniform Parentage Act: 1. 'Acknowledged father' means a man who has established a father-child relationship by signing an acknowledgment of paternity under Article 3 of the Uniform Parentage Act;" 10 O.S.2011, § 7700-102 (1). Section 7700-102 was amended in 2019, but did not change the definition of an acknowledged father. 3 We take judicial notice that on May 31, 2013, less than three months after the Acknowledgment of Paternity was signed, Mother filed a paternity action against the acknowledged father in Blaine County District Court in FP-2013-10. Mother dismissed the paternity proceeding, with prejudice, on March 22, 2019, approximately two months after this proceeding was filed. 4 A. If a child has an acknowledged father, a signatory to the acknowledgment of paternity may commence a proceeding seeking to challenge the paternity of the child only within the time allowed under Section 15 or 16 of this act. B. If a child has an acknowledged father or an adjudicated father, an individual, other than the child, who is neither a signatory to the acknowledgment of paternity nor a party to the adjudication and who seeks an adjudication of paternity of the child shall commence a proceeding not later than two (2) years after the effective date of the acknowledgment or adjudication. C. A proceeding under this section is subject to the application of Section 16 of this act. 10 O.S.2011, § 7700-609. Section C refers to Section 16 of the Uniform Parentage Act, 2006 Okla. Sess. Laws ch. 116, HB 2967, § 42, which was codified as title 10, section 7700-308. See 2006 Okla. Sess. Laws ch. 116. Section 7700-308 was amended effective November 1, 2019, see infra note 10. 5 The court minute stated: ACKNOWLEGMENT [sic] OF PATERNITY IS ADMITTED UNDER SEAL; RESPONDENT PRESENT WITH ATTORNEY MARIA TULLY ERBAR; PLAINTIFF DERRICK SCOTT AND HIS ATTORNEY ERIC EDWARDS DID NOT APPEAR; THE COURT GRANTS RESPONDENT'S MOTION TO DISMISS AND GRANTS SUMMARY JUDGMENT BASED UPON THE AOP THAT WAS FILED IN COURT UNDER SEAL AND MOTIONS FILED AND EVIDENCE PRESENTED PRESENTED [sic] AT THE HEARING; REQUESTING ATTORNEYS FEES ISSUE IS RESERVED BY APPLICATION OF THE RESPONDENT; EDWARD'S SECRETARY ORALLY REQUESTED A CONTINUANCE AT APPROX. 10:00 AM RIGHT BEFORE COURT AND THE COURT DENIED THE ORAL REQUEST. Blaine Cty. Dist. Ct., FP 2019-1, Mar. 4, 2019. On March 6, 2019. Scott filed a motion to vacate the minute order. The minute order was vacated on June 21, 2019. 6 Scott attached a copy of his petition which he filed in the district court on April 15, 2020. Scott argued that the Oklahoma Legislature's recent amendment of title 10, section 7700-607(D) made it the controlling statute in this case and that the Legislature, in essence, conceded or recognized that section 7700-609(B) was unconstitutional on its face. Scott acknowledged that HB 2270, amending section 7700-607(D) was submitted on February 19, 2019, and approved by the Governor on April 25, 2019 with an effective date of November 1, 2019, but Scott had only recently become aware of the amendment to bring it to the court's attention. 7 On November 4, 2021, the district court denied the motion to vacate by minute entry. On December 30, 2021, the Court of Civil Appeals filed an order which noted the minute entry and directed both parties to show cause within 15 days why the court should not proceed. Neither party responded. 8 On April 11, 2022, Mother filed a motion to settle journal entry in district court, regarding the motion to vacate. On June 7, 2022, the district court filed its order denying the motion to vacate. 9 And on July 5, 2022, Scott filed a Second Amended Petition in Error and Motion for Additional Time to Supplement the Record on Accelerated Appeal, appealing from the district court's June 7, 2022 order denying the motion to vacate. On July 25, the Court of Civil Appeals denied Scott's motion for additional time to supplement the record and struck the Second Amended Petition in Error and Second Amended Designation of Record from the appellate docket. The Court of Civil Appeal's order stated that "Appellant's effort to extend his appeal by amending his petition in error at this late date is untimely." As we have repeatedly stated, a minute entry is not an appealable order. Laubach v. Laubach, 2022 OK 78, ¶ 15, -- P.3d --. Thus the Court of Civil Appeals erred in lifting the stay in the appeal and erred in striking the Second Amended Petition in Error and Second Amended Designation of Record timely appealing the June 7, 2022 order within less than thirty days after it was filed. See 12 O.S. Supp. 2017, § 990A(A); see also Corbit v. Williams, 1995 OK 53,¶ 9, 897 P.2d 1129, 1131 (A "'Court Minute' is not a judgment, decree or appealable order for the purpose of commencing the time to appeal"); see also Kordis v. Kordis, 2001 OK 99, ¶ 6, 37 P.3d 866, 869 ("an order disposing of a term-time motion to vacate, filed under 12 O.S.1991 § 1031.1, is a separately appealable, post-judgment event"). Because we vacate the Court of Civil Appeals' opinion in regard to this issue and provide Scott his requested relief, reversing the district court, the Second Amended Petition in Error is moot. 10 "Litigants--and the courts--often conflate the discovery rule, equitable tolling, and estoppel. Nonetheless, these are separate theories a plaintiff may employ to defeat a statute of limitations defense. See Calvert v. Swinford, 2016 OK 100, ¶ 11, 382 P.3d 1028, 1033 (discovery rule); Masquat v. DaimlerChrysler Corp., 2008 OK 67, ¶ 18, 195 P.3d 48, 54-55 (equitable tolling based on fraudulent concealment); Jarvis v. City of Stillwater, 1987 OK 5, ¶ 4, 732 P.2d 470, 472-73 (estoppel)." Crawford ex rel.C.C.C. v. OSU Med. Tr., 2022 OK 25, ¶ 5 n.1, 510 P.3d 824, 829 n.1. 11 Published opinions of the Court of Civil Appeals merely have persuasive effect; they hold no precedential value. See Okla. Sup. Ct. R. 1.200(d). 12 A. After the period for rescission under Section 7700-307 of this title has expired, a signatory of an acknowledgment of paternity may commence a proceeding to challenge the acknowledgment only: 1. On the basis of duress or material mistake of fact within two (2) years after the acknowledgment is executed; or 2. On the basis of fraud at any time in accordance with subsection D of Section 7700-607 of this title. 10 O.S. Supp. 2019, § 7700-308(A) (effective Nov. 1, 2019) (emphasis added). 13 D. A proceeding seeking to disprove the father-child relationship between a child and the child's presumed or acknowledged father may be maintained at any time before the child is eighteen (18) years of age on the basis of fraud as defined in Section 7700-102 of this title. A party bringing a challenge under this section has the burden of proving fraud by clear and convincing evidence. Upon a finding of fraud, the court shall conduct a best-interest hearing to determine if genetic testing should be ordered pursuant to Section 7700-608 of this title. Court-ordered genetic testing shall be performed prior to an order of nonparentage under Sections 7700-621 and 7700-631 of this title. Any genetic test performed shall be in accordance with Sections 7700-501 through 7700-511 of this title. 1. The cost of the genetic testing to disprove parentage shall be advanced by the individual challenging parentage; 2. In a court order of nonparentage, a noncustodial parent has no right to reimbursement for child support and medical support payments made under a child support order; and 3. The court shall order the State Department of Health, Division of Vital Records, to amend the birth record of the child, if appropriate. 10 O.S. Supp. 2019, § 7700-607(D) (effective Nov. 1, 2019) (emphasis added). 14 "'Fraud' means an intentional misrepresentation of a material fact that could not have been discovered with reasonable diligence and was reasonably relied upon;" 10 O.S. Supp. 2019, § 7700-102 (9). Kane, C.J., concurring: ¶1 While § 77--609 is valid, the Court of Civil Appeals applied the wrong Constitutional test to analyze the proper application of said statute. ¶2 This case involves a troubling fact pattern, wherein it is set forth that the alleged biological father's equal protection and due process rights were abridged when a third-party claimed paternity without his knowledge. The net result was that the putative father of a child was stripped of his parental rights without notice, and he is now being deprived of an opportunity to be heard by the government due to the passage of time. ¶3 Citing to Gladstone v. Bartlesville Indep. Sch. Dist. No. 30 (I-30), 2003 OK 30, 66 P.3d 442, the Court of Civil Appeals correctly noted that, absent a suspect classification or the infringement upon a fundamental right, the rational basis test should govern any dispute involving alleged governmental interference with a right. ¶4 Yet, while it is axiomatic that a parent has a fundamental right to the care, custody, companionship and management of his or her child, protected by both the Federal and State Constitutions, see In re K.H., 2021 OK 33, ¶ 26, 507 P.3d 647, 653, the Court of Civil appeals determined that the unmarried putative father was entitled to mere rational basis consideration. ¶5 The proper level of scrutiny for interference with parental rights to care, custody, and control of a child in this particular scenario has not been set forth by this Court.1 The Court of Civil Appeals concludes that since the putative father was not married to the mother, he had no fundamental rights to seek a relationship with his child. Hence, the Court of Appeals applied what it termed a "lenient test" to the State's attempt to cut off the putative father's rights. ¶6 Absent authority from this Court, the lower court and the Court of Civil Appeals made the legal judgment call that an unmarried parent had no fundamental rights to a relationship with his child. For the benefit of the bench and the bar, we should speak with clarity on this subject. In my view, the existence or absence of a marriage license should not control over whether or not a parent has a fundamental right.2 FOOTNOTES 1 To the same effect at the federal level. See Margaret Ryznar, A Curious Parental Right, 71 SMU L. Rev. 127, 157 (2018) ("The U.S. Supreme Court has not articulated a consistent level of scrutiny for interferences with the parental right to the care, custody, and control of a child, despite using language that characterizes it as a fundamental right. As a result, the lower courts have split in their approaches, causing inconsistency and unpredictability."). 2 The Court of Civil Appeals has applied the strict scrutiny test to governmental interference with parental rights in other cases. See, e.g., In re Blevins, 1984 OK CIV APP 41, ¶ 9, 695 P.2d 556, 559-60 ("The courts will apply the tests of strict judicial scrutiny to a state law which interferes with the exercise of fundamental rights and liberties explicitly or implicitly protected by the Constitution."); San Antonio Indep. Sch. Dist. v. Rodriguez, 411 U.S. 1 (1973). Gurich, J., concurring specially: ¶1 I concur, but I write specially to address the fact that COCA's plurality opinion in this case is inappropriate. ¶2 Pursuant to Article VII, Section 5 of the Oklahoma Constitution: "A majority of the members of the Supreme Court shall constitute a quorum and the concurrence of the majority of said Court shall be necessary to decide any question." Okla. Const. Art. VII, § 5 (emphasis added). Therefore, plurality opinions are prohibited. ¶3 This prohibition applies not only to the Supreme Court, but to COCA as well. Oklahoma Supreme Court Rule 1.174 states that for appeals assigned to COCA, "The concurrence of two judges shall be necessary to make a decision on the merits." Okla. S.Ct. R. 1.174, Tit. 12, ch. 15, App. 1. See also 20 O.S. Supp. 1996, § 30.2 ("Each division shall consist of three Judges, at least two of whom shall concur in any decision"); In the Matter of the Estate of Brown, 2013 OK 102, 509 P.3d 66 (Holding that the petition for certiorari was premature because COCA's opinion lacked a majority vote). ¶4 In this case, Judges Rapp and Blackwell concurred as to Part III A, with Wiseman concurring in result. Judges Rapp and Wiseman concurred as to Part III B, with Blackwell dissenting. As concurring in result votes cannot be counted as votes to form a majority opinion, In the Matter of the Estate of Brown, 2013 OK 102, 509 P.3d 66 (citation omitted), there were no two judges who concurred with the entirety of the opinion. This is inconsistent with the requirements of Oklahoma Supreme Court Rule 1.174 and Title 20, Section 30.2, and therefore the plurality opinion in this case is inappropriate. ROWE, V.C.J., DISSENTING: ¶1 The majority fails to adequately distinguish between a statute of limitations and a statute of repose. A statute of limitations prescribes a time period within which an action may be initiated and which begins to run when the cause of action fully accrues. Consolidated Grain & Barge Co. v. Structural Sys., Inc., 2009 OK 14, ¶ 9, 212 P.3d 1168, 1171. A cause of action accrues when all the elements of the underlying claim are present. Id. A statute of limitation provides an affirmative defense, which can be waived; it does not deprive the court of jurisdiction to act upon the claim if untimely filed. Id. ¶2 Alternatively, a statute of repose prescribes a time period within which an action may be initiated and which begins to run from the date of a specific act or event. Id. ¶ 10, 212 P.3d at 1171. Because the cause of action need not have fully accrued for a statute of repose to come into effect, it may or may not allow for the plaintiff's discovery of the cause of action. Id. A statute of repose operates on the substantive right to pursue a cause of action and will extinguish that right even if it has not fully accrued. Id. ¶3 I cannot agree with the majority that it is unreasonable that the Legislature could have intended the two-year limitation for a putative father to seek an adjudication of paternity, as contained in 10 O.S.2011 § 7700-609(B), to serve as a statute of repose, rather than a statute of limitations. The text of § 7700-609(B) clearly reflects the Legislature's intent to have it operate as a statute of repose. ¶4 Section 7700-609(B) states: If a child has an acknowledged father or an adjudicated father, an individual, other than the child, who is neither a signatory to the acknowledgment of paternity nor a party to the adjudication and who seeks an adjudication of paternity of the child shall commence a proceeding not later than two (2) years after the effective date of the acknowledgment or adjudication. (emphasis added). Here, the two-year limitation begins to run from the date of the acknowledgment or adjudication of paternity. Because the time period runs from the date of a specific event, § 7700-609(B) is clearly intended as a statute of repose. Accordingly, Petitioner's cause of action is extinguished. The fact that he discovered his claim of paternity too late, whether due to alleged fraud on Defendant's part or any other reason, is not relevant at this point. ¶5 Despite the seemingly harsh nature of this outcome, there are compelling public policy considerations behind the strict two-year time limit. Proceedings involving claims of paternity inevitably have an impact on the child's well-being, and in instances like this, where there is already an acknowledged or adjudicated father, subsequent claims of paternity run the risk of injecting turmoil and confusion into the child's life. Additionally, a putative father cannot claim the two-year limit is unreasonable, nor can he claim to have been completely unaware of his claim of paternity during that time. Babies are not delivered by a stork. Men beware--nine months after sexual intercourse, you may be a father. ¶6 The Legislature is vested with authority to establish public policy vis-à-vis the two-year statute of repose. As this does not infringe upon a constitutional right, I would affirm the District Court's order granting Respondent's motion to dismiss. I respectfully dissent. KUEHN, J., DISSENTING: ¶1 Under the applicable law, Scott's window to allege paternity closed years ago. A bare claim of fraud cannot resurrect his claim now. The analysis in Hill v. Blevins, 2005 OK 11, 109 P.3d 332, is directly on point. Even if Scott could allege fraud to toll the running of the limitations period, and even if he could prove that fraud, he still loses, because he possessed sufficient facts to raise his challenge long before the law foreclosed that right. The upshot is that if a man thinks he has fathered a child, he has an opportunity to timely acknowledge parenthood or have his status judicially determined. But he cannot wait in the shadows indefinitely. Accordingly, I dissent. A. Overview of relevant law. ¶2 The Uniform Parentage Act (10 O.S. § 7700-101 et seq.; "the Act")1 divides men who claim parentage into several classes. The Act distinguishes among acknowledged fathers (who formally declare paternity), adjudicated fathers (whose paternity is determined by a court), and presumed fathers (who are married to the mother, or living with the child, at relevant times). 10 O.S. § 7700-102(1), (2), (16) and § 7700-204. Their rights are not co-equal. Scott is none of these. He is an alleged father -- "a man who alleges himself to be [] the genetic father or a possible genetic father of a child, but whose paternity has not been determined." 10 O.S. § 7700-102(3).2 While the Act defines alleged fathers, it rarely mentions them specifically. ¶3 Since a few days after the birth of Foster's child in February 2013, there has been an acknowledged father -- "a man who has established a father-child relationship by signing an acknowledgment of paternity...." 10 O.S. § 7700-102(1). An acknowledgment must be joined by the mother, but notably, it requires no genetic confirmation. 10 O.S. § 7700-302(A)(5). It is equivalent to an adjudication of paternity, and confers "all of the rights and duties of a parent." 10 O.S. § 7700-305(A).3 ¶4 The Act limits the time to challenge parentage depending on the circumstances and the challenger's status. The number of possible scenarios is daunting. Parties to an acknowledgement of paternity must be informed that challenges are permitted "only under limited circumstances" and are barred after two years. 10 O.S. § 7700-302(A)(5). After a 60-day window to rescind the acknowledgment for any reason, one who has acknowledged paternity may only challenge on the grounds of "fraud, duress, or material mistake of fact," and must make that claim within two years after the acknowledgment was executed. 10 O.S. § 7700-308(A). ¶5 Additional direction on time limits for a challenge is found in Section 609. Paragraph A reiterates the two-year window for signatories to an acknowledgment of paternity. For those who weren't parties to the acknowledgment -- like Scott -- Paragraph B provides: If a child has an acknowledged father or an adjudicated father, an individual, other than the child, who is neither a signatory to the acknowledgment of paternity nor a party to the adjudication and who seeks an adjudication of paternity of the child shall commence a proceeding not later than two (2) years after the effective date of the acknowledgment or adjudication. 10 O.S. § 7700-609(B) (emphasis added). Foster claimed this provision barred Scott's suit, filed almost six years after the acknowledgment of paternity. The trial court, and the Court of Civil Appeals, agreed. ¶6 Instead, the Majority looks to post-judgment amendments to yet another provision in the Act -- Section 607 -- and retroactively applies them here. The 2019 changes actually affect both Sections 308 and 607. A new paragraph was added to the latter, and the Majority reads it as 'clarifying' that the Legislature has always intended to give an alleged father -- one who never timely acknowledged paternity or demanded that his paternity be judicially decided -- the opportunity to upend the relationship between a child and a presumed or acknowledged father at any time before the child's eighteenth birthday on the grounds of fraud. 10 O.S.Supp.2019, § 7700-607(D).4 In the same bill, the Legislature amended Section 308, which (as noted) also provides limitations on challenges. Cross-referencing Section 607(D), the amended version of Section 308 allows acknowledged fathers to disown paternity on the basis of fraud at any time before the child's eighteenth birthday. However, those who previously denied paternity are excluded from this change -- even if the prior denial was also procured by fraud.5 Compare 10 O.S.Supp.2019, § 7700-607(D) with 10 O.S.Supp.2019, § 308(B). ¶7 Did the Legislature, with these amendments, really intend to allow one who neither timely acknowledged nor timely denied paternity -- someone who may be a complete stranger to the family unit -- to intervene, even some nineteen years after a sexual encounter, and claim paternity through a bare allegation of fraud? All while maintaining a flat two-year limitation on one who formally denied paternity, even if the denial may also have been procured by fraud? ¶8 The 2019 amendments present interpretive difficulties to be sure. But we need not tease out their meaning today. My point in surveying them is to show that they mark a drastic change in the law, and cannot be used to interpret the laws that apply to this case. B. The 2019 amendments are a marked change from prior law. ¶9 The Majority relies on amendments to the Act that did not go into effect until months after the trial court made its ruling in June 2019. The court ruled that Scott's claim was barred under the law existing at the time (Section 609(B)). Whatever the 2019 amendments mean, they cannot be applied to resurrect Scott's claim. ¶10 When a statute is amended, the legislature may have intended to either (1) effect a change to existing law or (2) clarify that which was previously doubtful. Magnolia Pipe Line Co. v. Okla. Tax Comm., 1946 OK 113, ¶ 11, 167 P.2d 884. There was nothing doubtful about the prior law in this case. It imposed a two-year limitation period for any challenge by a signatory to an acknowledgment or denial of paternity, and the same limit for any challenge by one who was not a signatory to an acknowledgment or party to an adjudication -- including alleged fathers such as Scott. 10 O.S. §§ 7700-308, 7700-609. The amendments changed some of these limitations, but not all. ¶11 Because the 2019 amendments drastically alter existing law, the practical effect of the Majority's analysis is a retroactive application of the amendments. We presume amendments operate prospectively, and the presumption is only rebutted where a contrary intent is expressly declared or necessarily implied by the statutory text. Kluver v. Weatherford Hosp. Authority, 1993 OK 85, ¶ 7, 859 P.2d 1081. No such intention can be found here, particularly since the statute on which the trial court based its ruling, 10 O.S. § 7700-609(B), remains intact. ¶12 Even when limitation statutes are extended by later amendments, they only extend the life of currently-existing claims; they do not revive claims that expired before the amendment. Trinity Broadcasting Corp. v. Leeco Oil Co., 1984 OK 80, ¶ 7, 692 P.2d 1364. This is a matter of constitutional mandate. "The Legislature shall have no power to revive any right or remedy which may have become barred by lapse of time, or by any statute of this State." Okla.Const. art 5, § 52. The test is whether the claim still exists at the time the limitation period is extended. If a plaintiff's right to recover was barred by a statute of limitations before the statute is amended, it is still barred. Mires v. Hogan, 1920 OK 308, ¶ 9, 192 P. 811. ¶13 Whatever the 2019 amendments actually mean, no one can deny that they add to and materially change both Sections 607 and 308. The Majority proposes nothing less than a retroactive application of these amendments, in an attempt to get Scott into the new scheme. This promises catastrophic results. It would not just permit Scott's challenge. It would resurrect untold numbers of paternity claims by men who, for the past eighteen years, did nothing to assert their "fundamental right" to fatherhood.6 C. The trial court's ruling was correct, whether the applicable lawis a statute of limitation or a statute of repose. ¶14 The trial court, and the Court of Civil Appeals, concluded that Section 609(B) is a "statute of repose." Simply put, a time-frame for bringing suit is labeled a "statute of limitation" if it is susceptible to tolling for equitable reasons, and a "statute of repose" if the legislature made it clear that no such exceptions are allowed. The "discovery rule," discussed below, is a judicially-created exception. The idea is that one should not be allowed to benefit by watching the time for another's claim expire when he has hidden the facts giving rise to the other's cause of action. In contrast, a statute of repose is a firm outer boundary on when a claim can accrue at all -- no exceptions.7 ¶15 Scott's argument fails, even if the two-year period specified in Section 609(B) is tolled by fraud on Foster's part. But how do we know that Section 609(B) is a statute of repose which permits no tolling? Because Section 308 says so. ¶16 While Section 308 provides that a signatory to an acknowledgment of paternity may mount a challenge, the challenge must be brought within two years, and fraud is one of only three bases for allowable challenge. This is a statute of repose. An allegation of fraud does not extend the time to sue; it is baked into the ability to sue at all. The limitation in Section 308 is (1) only for fraud, and (2) only within two years. And Section 609, on which the trial court relied, specifically states Scott's suit "is subject to the application of" Section 308. 10 O.S. § 7700-609(C). Because Section 308 already has fraud baked into the two-year limitation period, Scott can't use an allegation of fraud to further extend it. ¶17 The difference between a statute of limitation, and a statute of repose, may be best summed up this way: "A statute of repose establishes the right not to be sued, rather than the right to sue." 51 Am.Jur.2d Limitation of Actions § 4 (emphasis added). When the law recognizes one man as a father, it can demand vigilance from another who seeks to upend that relationship. "Statutes of repose reflect the legislative conclusion that a point in time arrives beyond which a potential defendant should be immune from liability for past conduct." Id. It is clear that Section 609(B) is a statute of repose, and permits no extensions when the challenger claims his cause of action was hidden from him by fraudulent conduct.8 ¶18 But even if we ignore all of this, and we do read Section 609(B) as a statute of limitation that is tollable by fraud, Scott still loses. Scott's claim is that (1) Foster always knew he was the child's father; (2) Foster falsely claimed otherwise when, in March 2013, she signed the acknowledgment of paternity in favor of another man; and (3) Foster later admitted Scott was the father. Scott doesn't say when or how Foster made such an admission. In fact, from the record it seems Scott's theory is largely based on an inference. In 2018, Foster had her child's surname changed from the acknowledged father's to Foster's. When Scott learned from the pleadings that the acknowledged father had no role in the child's life since birth, Scott inferred that the 2013 acknowledgment of paternity was a sham. Of course, the trial court's ruling that Section 609(B) was a statute of repose rendered Scott's assertions of fraud irrelevant. But Scott's initial strategy appears to have been that a mere allegation of fraud gets him in the door, and his tactic was to press for discovery in an attempt to uncover evidence to support his theory that Foster knew all along her child's acknowledged father was not the biological father. ¶19 The discovery rule tolls a statute of limitation "until an injured party knows of, or in the exercise of reasonable diligence, should have known of or discovered the injury, and resulting cause of action." Weathers v. Fulgenzi, 1994 OK 119, ¶ 12, 884 P.2d 538 (citation omitted; emphasis added). "A party generally cannot avoid the bar of the statute of limitations, by virtue of the discovery rule, if he or she had the means to discover the facts giving rise to his or her action." 54 C.J.S. Limitations of Actions § 136. The party seeking to invoke the discovery rule is judged by an objective standard, which "does not reward denial or self-induced ignorance." Id. The discovery rule "requires only that the plaintiff be aware of an injury; it does not require the plaintiff to know the full extent of the injury." 54 C.J.S. Limitations of Actions § 135. It is a "very limited exception to limitations and is construed strictly." Id. ¶20 Scott wants to use facts (such as the 2018 name-change proceeding) that stoked his suspicions of fraud as the starting point for his window to sue. But the true test is: When did Scott have sufficient facts giving rise to a potential paternity suit? The answer to that question is: Well within the two-year window. The flames of suspicion may have been stoked in 2018, but the fire had been smoldering for a long time. ¶21 When a woman becomes pregnant, any male she had relations with during a period of time could potentially be the biological father. When any of these men learn of the pregnancy, they are on notice that they could be the father. Any party -- the mother included -- is susceptible to being lied to by any or all of the others. Whatever assurances the mother or her partners may give to one another, only a genetic test can confirm or deny biological parentage.9 ¶22 Scott admits that within two years after the birth, he suspected he was the child's father. He claims he asked Foster to agree to genetic testing during that time but she refused. Such a refusal would only have bolstered suspicion. In other words, even if Foster personally assured Scott during that time that he could not be the father, Scott suspected, within the two-year period, that this was not true. ¶23 "A cause of action accrues when the damage can be discovered, not when it is actually discovered." 54 C.J.S. Limitations of Actions § 136 (emphasis added). Scott could have timely filed an action to adjudicate paternity and demanded genetic testing -- the only way to prevail if the child already has an acknowledged father. 10 O.S. § 10 O.S. §§ 7700-602(3), 7700-631(1). But for whatever reason, Scott did nothing.10 ¶24 Hill v. Blevins, 2005 OK 11, 109 P.3d 332, is directly on point. Hill was decided before the Uniform Parentage Act, but the fact pattern and basic analysis is the same as the present case. Hill had a sexual relationship with Reynolds, an unmarried woman. When the child was born, another man acknowledged paternity. Years later, Hill sought to have his paternity established and the prior acknowledgment of paternity in favor of the other man vacated, claiming it was procured by fraud. We held that Hill's suit, some six years after the child's birth, came too late under the two-year limitation period in effect at the time, because the means for discovering the cause of action had long been available to Hill: Instead of making inquiry about the birth, the issuance of a birth certificate, or matters of support and visitation, Hill waited until the child was almost six years old before he filed suit. The means of discovery of the alleged fraud were no less available to Hill in the fall of 1997 than they were five years later in June of 2002. So, even if Blevins' naming of Sawyer as the father was false, means of discovering the alleged fraud were readily available to Hill any time from and after the issuance of the birth certificate on October 17, 1997, expiring two years later in October of 1999. This suit, filed nearly four years subsequent, July 2003, was correctly found to be time-barred by the trial court. Id. at ¶ 11. ¶25 Scott's cause of action is not fraud. His cause of action is paternity. Scott's allegation of fraud is simply his way of trying to reset the clock on his underlying claim of paternity.11 He attempts to use a claim of newly discovered evidence to obscure the fact that he knew enough, within two years of the acknowledgment, to formally claim his "fundamental right" to be a father. That is not how the law works. Like the alleged father in Hill, Scott was "presumptively capable of asserting and protecting his own rights" in a timely fashion, but did not.12 Hill, 2005 OK 11, ¶ 12, 109 P.3d 332. Discovery of sufficient facts to bring a cause of action, and discovery of facts suggesting an attempt to hide that cause of action, are very different things. Otherwise, the fraud exception would swallow the rule.13 ¶26 Accordingly, I dissent. Our acceptance of certiorari was limited to one of many claims raised by Scott. Because the Court of Civil Appeals succinctly and correctly decided all of them, I would dismiss certiorari as improvidently granted. FOOTNOTES 1 Relevant provisions were amended in 2019, and I address them below. Unless otherwise noted, my citations are to provisions in effect at the time Scott filed his lawsuit. For simplicity and brevity, unless giving the full citation I refer to the section numbers of the Act ("Section 101" instead of "Section 7700-101"). 2 An alleged father does not enjoy the same status as a "presumed" father. 10 O.S. § 7700-102(3). A "presumed" father is "a man who, by operation of law under Section 7700-204 of this title, is recognized as the father of a child until that status is rebutted or confirmed in a judicial proceeding." 10 O.S. § 7700-102(16). Scott doesn't attempt to establish that he is a presumed father, and he incorrectly cites to provisions pertaining to presumed fathers as relevant to his argument (Petition for Certiorari p. 2). 3 Whether paternity is adjudicated or acknowledged, "[t]he father-child relationship is established." 10 O.S. § 7700-201(B). 4 Section 607 imposes a two-year limitation on anyone challenging the paternity of a presumed father. It then states that a proceeding to challenge the relationship between a child and a presumed or acknowledged father may be made at any time, so long as all three parties agree to it -- i.e. a friendly paternity suit. 10 O.S § 7700-607. Those provisions remain in effect after the 2019 amendment. 5 Before November 2019, Section 308 had a two-year statute of repose for any challenge by signatories to an acknowledgment or denial of paternity, and it limited claims in that time-frame to ones for fraud, mistake or duress. The 2019 amendment replaced this scheme with a statute of limitation and two statutes of repose. In short, it allows signatories to an acknowledgment of paternity to make fraud-based challenges at any time, "in accordance with [Section 607(D)]," but maintains a two-year statute of repose for claims of duress or mistake on these parties. The 2019 amendment also maintains a two-year statute of repose on challenges made by signatories to a denial of paternity, and it still limits those challenges to fraud, duress, or mistake. 10 O.S.Supp.2019, § 7700-308(A), (B). The Majority notes the change to paragraph A, but not paragraph B. 6 In his petition for certiorari, Scott argues that application of Section 607(D) "AFFECTS POTENTIALLY THOUSANDS OF FATHERS AND CHILDREN IN THIS STATE! [sic]" 7 Early treatise writers and judges considered time bars created by statutes of limitations, escheat and adverse possession as creating periods of repose. As the courts began to modify statutory limitations by superimposing the "discovery rule," legislatures responded by enacting absolute (not tollable) time bars through statutes of repose. Modern statutes of limitations and statutes of repose are somewhat similar because they both provide repose for the defendant. They are nonetheless significantly different since a statute of limitation merely extinguishes the plaintiff's remedy while a statute of repose may defeat the accrual of a cause of action before one ever arises. Kirby v. Jean's Plumbing Heat & Air, 2009 OK 65, ¶ 10, 222 P.3d 21. 8 Even Section 607(D), added in 2019, is a statute of repose (albeit with a very long time-frame), not a statute of limitation. Fraud is the only allowed basis for extending the term, but the time to sue is definite -- not "tolled" due to fraud (it must in any event be brought before the child turns eighteen). 9 Scott paints himself as somehow being uniquely susceptible to fraud in this situation. I disagree. Any male who has intimate relations with a woman capable of bearing children faces the same potential for fraud. She may falsely claim to be using birth control or be incapable of getting pregnant. If she has relations with more than one man in a short span of time (possibly unbeknownst to any of the male partners), she may claim any one of them is the father. She may do so out of fondness, practicality, mistake, or spite. Or she might name no one. A male partner who cares enough to have relations that could result in pregnancy should conduct himself accordingly. 10 Scott complains that the law allows a woman to terminate a biological father's parental rights by convincing another man (honestly or otherwise) to formally acknowledge paternity. Nothing in the law requires that the acknowledged father prove the child is his true genetic offspring. But one who believes himself to be the father may challenge an acknowledgment of paternity; he simply must do so timely. Had Scott timely sought and successfully established paternity, he would have been obligated to provide support. 10 O.S. § 83(A). 11 There is a subtle but important distinction between concealment of facts that prevents one from discovering a fraud, and the "discovery rule," potentially tolling a statute of limitation on any cause of action. 54 C.J.S. Limitations of Actions § 137. 12 The Majority (at ¶22) seeks to protect alleged biological fathers where a mother "intentionally misrepresents a material fact that could not be discovered with reasonable diligence." This confuses notice of a possible fraud with notice of a possible paternity claim. 13 In his petition for certiorari, Scott claims the Court of Civil Appeals applied the wrong standard of review. While Foster had moved for summary judgment, Scott claims her argument was more in the nature of a motion to dismiss. Hence, he claims, all of his factual allegations must be taken as true. See Murrow v. Penney, 2023 OK 91, ¶ 15, 535 P.3d 1275. That doesn't change the outcome here. Even assuming Foster lied to Scott in 2013, and confessed as late as yesterday, Scott admits questioning the child's paternity before the two-year period expired.

97de7abb-3664-4ef4-86b6-11c2b8bcb792

CANTWELL v. FLEX-N-GATE

oklahoma

Oklahoma Supreme Court

CANTWELL v. FLEX-N-GATE2023 OK 116Case Number: 120189; Comp w/ 120458, 120460Decided: 12/12/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. KEVIN CANTWELL, Petitioner, v. FLEX-N-GATE, HARTFORD ACCIDENT INDEMNITY CO., and THE WORKERS' COMPENSATION COMMISSION, Respondents, and KEVIN CANTWELL, Petitioner, v. FLEX-N-GATE, HARTFORD ACCIDENT INDEMNITY CO., and THE WORKERS' COMPENSATION COMMISSION, Respondents, and KEVIN CANTWELL, Petitioner, v. FLEX-N-GATE, HARTFORD ACCIDENT INDEMNITY CO., and THE WORKERS' COMPENSATION COMMISSION, Respondents. MATTER PREVIOUSLY RETAINED FOR DISPOSITION ¶0 This appeal concerns the Workers' Compensation Commission's interpretation of 85A O.S. Supp. 2013, § 46(H). The Claimant was awarded permanent partial disability in three work related claims, but denied payment pursuant to the Commission's interpretation of Section 46(H). The Commission interpreted Section 46(H) to limit permanent partial disability benefits to 350 weeks, even though the claimant had not yet reached 100% impairment to any body part or the body as a whole. We retained the case for disposition and hold that the 100% limitation on PPD benefits, codified at 85A O.S. Supp. 2013, § 45(C)(1), controls over the number of weeks when awarding compensation for PPD where a claimant has compensable awards for job related injuries that occurred before and after February 1, 2014. We vacate the Commission's order in each case, and remand the cases for further proceedings consistent with this opinion. OKLAHOMA WORKERS' COMPENSATION COMMISSION VACATED; CASE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. T.R. Banks, Ada, Oklahoma, for Petitioner, Kevin Cantwell. Bob Burke, Oklahoma City, Oklahoma, for Petitioner, Kevin Cantwell. Steve Hanna, Testan Law, Oklahoma City, Oklahoma, for Respondent, Flex-N-Gate. Gurich, J. ¶1 Petitioner in this case, Kevin Cantwell, worked for Respondent, Flex-N-Gate, for 28 years. Throughout his employment with Respondent,1 Cantwell suffered numerous work-related injuries. Prior to February 1, 2014, his claims for injuries were adjudicated by the judges of the Workers' Compensation Court. The statutory authority for the court system was found in Title 85.2 He received awards for benefits, including permanent partial disability (PPD). In 2014, the Legislature repealed Title 85 and enacted Title 85A, the Administrative Workers' Compensation Act (AWCA).3 Pursuant to Title 85A, the authority to adjudicate claims for injuries occurring after February 1, 2014, changed from a court of law to an administrative commission.4 Members of the Workers' Compensation Court judiciary were replaced by administrative law judges (ALJ) and a three member Commission (Commission).5 ¶2 Cantwell's injuries from 1992 to 2010 were governed by Title 85 of the Oklahoma Statutes. Title 85, Section 22(7), in effect at the time of claimant's injuries, provided: Previous Disability. The fact that an employee has suffered previous disability or impairment or received compensation therefore shall not preclude the employee from compensation for a later accidental personal injury or occupational disease; but in determining compensation for the later accidental personal injury or occupational disease the employee's average weekly wages shall be such sum as will reasonably represent the employee's earning capacity at the time of the later accidental personal injury or occupational disease. In the event there exists a previous impairment, including a previous non-work-related injury or condition which produced permanent disability and the same is aggravated or accelerated by an accidental personal injury or occupational disease, compensation for permanent disability shall be only for such amount as was caused by such accidental personal injury or occupational disease and no additional compensation shall be allowed for the pre-existing disability or impairment. The sum of all permanent partial disability awards, excluding awards against the Multiple Injury Trust Fund and awards for amputations, and surgeries, shall not exceed one hundred percent (100%) permanent partial disability for any individual. An individual may not receive more than five hundred twenty (520) weeks' compensation for permanent partial disability, but may receive other benefits under the Workers' Compensation Act if otherwise eligible as provided in the Workers' Compensation Act. 85 O.S. Supp. 2010, § 22(7) (repealed by Laws 2011, SB 878, c. 318, § 87) (emphasis added). 6 ¶3 The AWCA specifically limits the applicability of the AWCA to claims arising on or after February 1, 2014, while leaving Title 85 to govern all claims that arose prior to February 1, 2014. 85A O.S. Supp. 2013, § 3(C)--(D).7 The AWCA contains a 100% limitation on a claimant's cumulative PPD benefits, pursuant to Title 85A, Section 45(C)(1), which states: A permanent partial disability award or combination of awards granted an injured worker may not exceed a permanent partial disability rating of one hundred percent (100%) to any body part or to the body as a whole. The determination of permanent partial disability shall be the responsibility of the Commission through its administrative law judges. Any claim by an employee for compensation for permanent partial disability must be supported by competent medical testimony of a medical doctor, osteopathic physician, or chiropractor, and shall be supported by objective medical findings, as defined in this act. The opinion of the physician shall include employee's percentage of permanent partial disability and whether or not the disability is job-related and caused by the accidental injury or occupational disease. A physician's opinion of the nature and extent of permanent partial disability to parts of the body other than scheduled members must be based solely on criteria established by the Sixth Edition of the American Medical Association's "Guides to the Evaluation of Permanent Impairment". A copy of any written evaluation shall be sent to both parties within seven (7) days of issuance. Medical opinions addressing compensability and permanent disability must be stated within a reasonable degree of medical certainty. Any party may submit the report of an evaluating physician. 85A O.S. Supp. 2013, § 45(C)(1) (emphasis added). Section 46(H) of the AWCA also contains a limitation on PPD benefits, stating: The sum of all permanent partial disability awards, excluding awards against the Multiple Injury Trust Fund, shall not exceed three hundred fifty (350) weeks. 85A O.S. Supp. 2013, § 46(H). ¶4 Cantwell filed three appeals with this Court relating to injuries occurring after the AWCA's effective date.8 These three retained appeals address the Commission's application of Title 85A, Section 46(H). The Commission found that Section 46(H) limits an employee's award of permanent PPD benefits to 350 weeks, even though Cantwell has not yet reached 100% PPD to any body part or the body as a whole as allowed by Title 85A, Section 45(C)(1). We vacate the Commission's decision and remand for further proceedings consistent with this opinion. Facts & Procedural History ¶5 While Cantwell was employed by Respondent, he suffered numerous work-related injuries and was awarded PPD. In 1992, Cantwell was awarded 11.5% PPD to his ears for hearing loss. In 2007, he was awarded 27% PPD to his foot. In 2009, he was awarded 30% PPD to his neck, 5% to his left shoulder, 4% to his left arm, 4% to his right arm, 5% to his right hand, 22% to his left hand, and permanent disfigurement of his right hip. In 2010, he was awarded 15% PPD to his knee. The parties stipulated that Cantwell was awarded 360 weeks of PPD benefits for those prior injuries. Cantwell asserts that his total PPD benefits received under Title 85 equal 71.3% impairment based on the 520 week cap that was in effect at the time of all prior work related injuries. ¶6 After the enactment of the AWCA in 2014, Cantwell sustained three more injuries. In all three cases, the ALJ awarded Cantwell PPD benefits but denied payment. The Commission affirmed the ALJ in each case, holding that Section 46(H) precluded Cantwell from receiving more than 350 weeks of PPD benefits. Cantwell appealed in each case, challenging the constitutionality of Title 85A, Section 46(H), as applied. ¶7 The first case stems from a workplace injury Cantwell sustained while working for Respondent on June 5, 2014. This injury was a single incident injury to his left hip and lower back that occurred while he was installing a hydraulic pump. On December 14, 2019, Cantwell filed a CC-Form 3 with the Commission. Respondent admitted the injury and Cantwell received temporary total disability (TTD) and medical benefits. Cantwell underwent three arthroscopic surgeries to repair the injury to his hip and, finally, a total hip replacement when all other treatment failed. On July 9, 2021, the ALJ issued an order finding that Cantwell sustained 6% PPD to the lumbar spine and 24% PPD to the left hip. Because Cantwell had previously received 360 weeks of PPD benefits, the ALJ found that the PPD award was not payable pursuant to Title 85A, Section 46(H), which limits the receipt of PPD benefits to 350 weeks. Cantwell appealed to the Commission, which affirmed the ALJ in an order dated January 28, 2022. On February 7, 2022, Cantwell appealed that decision to this Court in case number 120,189. ¶8 The second case stems from a workplace injury Cantwell sustained while working for Respondent on January 17, 2017. This injury was a single incident injury to his right hand that he sustained while tightening the springs on an overhead door when a wrench twisted and hit him, breaking his wrist. Cantwell filed a CC-Form 3 on August 1, 2017. Respondent admitted the injury to the right hand, but denied all other injuries. Surgery and TTD benefits were eventually provided. In an order dated July 23, 2021, the ALJ awarded 22% PPD to Cantwell's right hand, which equated to an award of $15,633.20. Again, the ALJ found that this sum was not payable to Cantwell because of the limitation on weeks in Section 46(H). Cantwell appealed to the Commission, which affirmed the ALJ in an order dated May 23, 2022. On May 31, 2022, Cantwell appealed that decision to this Court in case number 120,458. ¶9 The third case stems from a workplace injury Cantwell sustained while working for Respondent on July 27, 2015. This injury was a single incident injury followed by cumulative trauma, aggravation, and injury with a date of awareness of March 10, 2016, and last date of exposure of February 7, 2018. Cantwell sustained the injury while pulling on an impact wrench as he was laying under a mold. Cantwell filed his first CC-Form 3 on July 26, 2016. Respondent admitted the 2015 neck injury, but denied cumulative trauma. Prior to surgery, Cantwell tried other remedies--physical therapy and cervical epidural steroid injections--which only provided short-lived relief. Reasonable medical care, including surgery, was ordered by the ALJ on May 18, 2018, and affirmed by the Commission on September 21, 2018. An order awarding PPD was entered by the ALJ on July 23, 2018. Though Cantwell had received a PPD award in 2010 for this same area, the ALJ awarded Cantwell an additional 15% PPD over and above the 2010 award. The ALJ stated that this amounted to $16,957.50, but once more stated that the sum was not payable due to Section 46(H)'s limitation. Cantwell appealed to the Commission, which affirmed the ALJ in an order dated May 23, 2022. On May 31, 2022, Cantwell appealed that decision to this Court in case number 120,460. Standard of Review ¶10 Pursuant to Title 85A, Section 78(C): The judgment, decision or award of the Commission shall be final and conclusive on all questions within its jurisdiction between the parties unless an action is commenced in the Supreme Court of this state to review the judgment, decision or award within twenty (20) days of being sent to the parties. Any judgment, decision or award made by an administrative law judge shall be stayed until all appeal rights have been waived or exhausted. The Supreme Court may modify, reverse, remand for rehearing, or set aside the judgment or award only if it was: 1. In violation of constitutional provisions; 2. In excess of the statutory authority or jurisdiction of the Commission; 3. Made on unlawful procedure; 4. Affected by other error of law; 5. Clearly erroneous in view of the reliable, material, probative, and substantial competent evidence; 6. Arbitrary or capricious; 7. Procured by fraud; or 8. Missing findings of fact on issues essential to the decision. 85A O.S. Supp. 2019, § 78(C). This case does not present a question of disputed fact, but rather addresses only the interpretation of Section 46(H) of the AWCA. The Court reviews issues of statutory interpretation de novo. Maxwell v. Sprint PCS, 2016 OK 41, ¶ 4, 369 P.3d 1079, 1083. Such review is plenary, independent, and non-deferential. Id. We are also mindful of the precedent of this Court that we will adopt a construction that upholds the statute, unless the repugnancy to the constitution is shown beyond a reasonable doubt. Schlumberger Technology Corp. v. Paredes, 2023 OK 42, ¶ 15, 528 P.3d 772, 778 (citation omitted). Analysis ¶11 The issue before this Court is whether Section 46(H) may limit a claimant's receipt of PPD benefits to not more than 350 weeks when the claimant: (1) was awarded PPD benefits prior to the enactment of the AWCA and was paid compensation for 360 weeks of benefits; and (2) had not reached 100% impairment to any body part or the body as a whole prior to the enactment of the AWCA. ¶12 In the present case, the Commission ignored the provision in Title 85A, Section 45(C)(1) and interpreted Section 46(H) to limit Cantwell's PPD benefits to 350 weeks, even though he had not yet reached 100% impairment to any body part or body as a whole. Cantwell argues that because the AWCA only applies to claims for injuries which occur after February 1, 2014, the Commission has no jurisdiction to interpret or change in any way the awards of PPD to Petitioner in cases from accidents before February 1, 2014. By applying the 350 week limitation in Section 46(H) without regard to Section 45(C)(1), Cantwell argues that the percentage of PPD that he is entitled to receive is diminished and is unconstitutional as applied in this case. Cantwell brings this challenge pursuant to the following provisions of the Oklahoma Constitution: Article II, Section 6; Article II, Section 7; and Article V, Section 54 of the Oklahoma Constitution. Article II, Section 6 guarantees Oklahomans a right to a remedy, stating: The courts of justice of the State shall be open to every person, and speedy and certain remedy afforded for every wrong and for every injury to person, property, or reputation; and right and justice shall be administered without sale, denial, delay, or prejudice. Okla. Const. art. II, § 6. Article II, Section 7 is the due process clause of the Oklahoma Constitution, which states: "No person shall be deprived of life, liberty, or property, without due process of law." Okla. Const. art. II, § 7. Section 54 of Article V addresses the repeal of statutes, stating: The repeal of a statute shall not revive a statute previously repealed by such statute, nor shall such repeal affect any accrued right, or penalty incurred, or proceedings begun by virtue of such repealed statute. Okla. Const. art. V, § 54. ¶13 This Court has recognized that the Legislature may alter Workers' Compensation benefits by stating: There is little doubt that a state legislature may alter private contractual rights of employers and employees when it properly exercises its police power in creating a particular workers' compensation law, or that the workers' compensation laws, by themselves, have been considered by courts as a legitimate State interest since the compensation laws were first created. Torres v. Seaboard Foods, LLC, 2016 OK 20, ¶ 30, 373 P.3d 1057, 1073. However, it is also clear that a State's legitimate interests in regulating business practices does not exempt it from the requirements of substantive due process. Id. ¶ 36, 373 P.3d at 1076. In examining these cases, the Court must weigh these rights and construe and apply the statute "in a manner that avoids conflict with our Constitution and give[s] the enactment the force of law." Id. ¶ 17, 373 P.3d at 1066--67. ¶14 Recognizing that the Legislature has used its power several times over the years to alter the limitations placed on PPD benefits, we must review the history of workers' compensation law in Oklahoma to understand the changes that have been made. Title 85, as amended in 1978, had no limitation on cumulative PPD benefits.9 Prior to its amendment in 1994, Title 85, Section 22(7) stated: Previous Disability. The fact that an employee has suffered previous disability or impairment or received compensation therefor shall not preclude him from compensation for a later accidental personal injury or occupational disease; but in determining compensation for the later accidental personal injury or occupational disease his average weekly wages shall be such sum as will reasonably represent his earning capacity at the time of the later accidental personal injury or occupational disease. In the event there exists a previous impairment which produced permanent disability and the same is aggravated or accelerated by an accidental personal injury or occupational disease, compensation for permanent disability shall be only for such amount as was caused by such accidental personal injury or occupational disease and no additional compensation shall be allowed for the pre-existing disability or impairment. 85 O.S. Supp. 1994, § 22(7), amended by Laws 1993, HB 1447, c. 349, § 10. ¶ 15 Effective November 4, 1994, however, Section 22(7) was amended to cap PPD benefits, stating: Previous Disability. The fact that an employee has suffered previous disability or impairment or received compensation therefor shall not preclude him from compensation for a later accidental personal injury or occupational disease; but in determining compensation for the later accidental personal injury or occupational disease his average weekly wages shall be such sum as will reasonably represent his earning capacity at the time of the later accidental personal injury or occupational disease. In the event there exists a previous impairment which produced permanent disability and the same is aggravated or accelerated by an accidental personal injury or occupational disease, compensation for permanent disability shall be only for such amount as was caused by such accidental personal injury or occupational disease and no additional compensation shall be allowed for the pre-existing disability or impairment. The sum of all permanent partial disability awards, including awards against the Special Indemnity fund, shall not exceed one hundred percent (100%) permanent partial impairment for any individual. An individual may not receive more than five hundred twenty (520) weeks' compensation for permanent partial disability, but may receive other benefits under the Workers' Compensation Act if otherwise eligible as provided in the Workers' Compensation Act. 85 O.S. Supp. 1995, § 22(7), amended by Laws 1994, 2nd Extr. Sess., HB 1002, c. 1, § 28 (emphasis added). The 520 week cap remained consistent until the AWCA was enacted in 2014. At that time, the cap was reduced to 350 weeks in Section 46(H), but the language limiting PPD awards to 100% [in Section 45(C)(1)] remained. 85A O.S. Supp. 2013, § 45(C)(1); 85A O.S. Supp. 2013, § 46(H). ¶16 Cantwell argues that he entitled to receive monetary PPD benefits from his recent adjudications because he has not reached 100% impairment. He argues that because he had only been adjudicated 71.3% impaired, he is still entitled to PPD compensation for the additional 28.7%.10 Respondent argues that the issues raised by Cantwell have already been addressed by this Court in Rivas v. Parkland Manor, 2000 OK 68, 12 P.3d 452. Respondent also argues that the Commission did not deprive Cantwell of a vested interest in violation of due process because Cantwell's interest in the award of PPD did not vest until the time of his injury--after the AWCA was enacted, which limited PPD benefits to 350 weeks. Though our Court has previously considered a cap on maximum PPD benefits, in Rivas and other cases, the challenge presented in this case is one of first impression. The challenge presented here is how to reconcile a reduction in allowable weeks with no reduction in the allowable percentage of impairment. ¶17 In Rivas, the claimant was injured in January of 1997, during his employment at Parkland Manor. Id. ¶ 2, 12 P.3d at 454. At the time of the claimant's latest injury, Rivas had already received compensation for PPD adjudications totaling 99.85%. Id. ¶ 2, 12 P.3d at 454. Due to the amendment to Section 22(7) in 1994, two caps on PPD benefits were adopted--one measured in cumulative weeks (with a 520 week maximum) and the other stated as a percentage of impairment (with a maximum impairment of 100% to any body part or the body as a whole). Id. ¶ 3, 12 P.3d at 454. Though the trial court found that the claimant suffered 30% PPD to the body as a whole, it limited the claimant's compensation award to 0.15% PPD, the difference between the statutory maximum of 100% and the claimant's prior awards totaling 99.85%. Id. The claimant appealed to the three judge en banc panel of the Workers' Compensation Court, arguing that the trial court's application of Section 22(7): (1) violated the claimant's right to equal protection and (2) violated Oklahoma Constitution Article V, Section 54 and Article II, Section 6. Id. ¶ 4, 12 P.3d at 454--55. The three judge panel upheld the trial court's ruling. Id. The claimant appealed the decision to COCA who reversed. Id. ¶ 5, 12 P.3d at 455. ¶18 On certiorari review, the Oklahoma Supreme Court determined that Section 22(7) was constitutional. Id. ¶ 25, 12 P.3d at 459. In considering the equal protection challenge, the Court stated that "legislation may draw certain classifications among individuals or groups of individuals, if those classifications are not arbitrary and capricious and bear some reasonable or rational relationship to a permissible public policy or goals." Id. ¶ 8, 12 P.3d at 456 (citation omitted). The Court--focusing on the 100% limitation--found that while Section 22(7) drew a distinction between two classes of people, that distinction was constitutional because the statute bore a reasonable relationship to the goals of the Workers' Compensation Act by limiting monetary exposure for employers and was applied evenhandedly to all claimants.11 Id. ¶¶ 9, 13, 14, 12 P.3d at 456--57 (emphasis added). It was applied evenhandedly because all workers covered under the WCA were subject to the same 100% PPD limitation. Id. ¶ 14, 12 P.3d at 457. ¶19 In addressing the argument that Section 22(7) violated Article V, Section 54, which prohibits the retroactive application of laws affecting substantive rights, the Court found that the claimant did not have a vested right to the more liberal remedy under the previous statute. Id. ¶ 24, 12 P.3d at 458. This was because the claimant did not acquire a vested right to a remedy for a cause of action until the cause of action accrues, in this case January of 1997. Id. ¶ 23, 12 P.3d at 458. Therefore, the Court concluded that the 100% limitation on PPD was constitutional. Id. ¶ 25, 12 P.3d at 459. ¶20 In Evans & Assoc. Utility Services v. Espinosa, 2011 OK 81, 264 P.3d 1190, the Court noted that following the decision in Rivas, the Legislature amended Section 22(7) at the next legislative session. The Legislature added language that expanded the benefits available because the calculation of the 520 maximum weeks for all PPD awards (which was still limited to 100%) excluded awards against the Multiple Injury Trust Fund as well as awards for surgeries and amputations. In Evans, the COCA interpreted the revised Section 22(7) to mean that an employee could receive either a total of 100% impairment, after excluding awards from the Multiple Injury Trust Fund and awards for amputations and surgeries, or 520 weeks of PPD benefits without such exclusions. Id. ¶ 11, 264 P.3d at 1194. This decision conflicted with another COCA division's opinion, so the Court was asked to resolve the conflict. Id. Writing for the Court, Justice Kauger determined that the sum of all PPD awards is limited to a total of 100% or 520 weeks, but under the terms of the statute, all awards against the Multiple Injury Trust Fund or awards for amputations or surgeries were excluded from both limitations. Id. ¶ 20, 264 P.3d at 1196. ¶21 Cantwell argues that he is deprived of a substantive right to compensation if his latest injuries are excluded from the computation of 100% impairment. Cole v. Silverado Foods, Inc., 2003 OK 81, 78 P.3d 542, is instructive in determining whether Cantwell's asserted right is substantive. In Cole, while the claim was pending final resolution, the Legislature shortened the time period for requesting adjudication from five years to three years. Id. ¶ 1, 78 P.3d at 544. The employer sought dismissal because claimant waited four years to seek a PPD hearing. Id. ¶ 2--3, 78 P.3d at 544. Claimant was awarded PPD benefits, but on appeal, the three-judge panel vacated her award. Id. ¶ 3, 78 P.3d at 544. Claimant challenged the decision of the three-judge panel in its retrospective application of Title 85, Section 43(B), which limited the time that a claimant had to press for resolution of compensation claims. Id. ¶ 1, 78 P.3d at 544. COCA reversed and reinstated the trial judge's award. Id. ¶ 3, 78 P.3d at 544--45. On certiorari review, Vice Chief Justice Opala, writing for the majority, determined that the right of an employee to compensation arises from the relationship of the parties on the date of the injury, and the statute in effect at that time determines the substantive rights and obligations of the parties. Id. ¶ 7, 78 P.3d at 546. Cole also recognized that pursuant to Article V, Section 54 of the Oklahoma Constitution, no subsequent amendments could affect a claimant's substantive rights. Id. The Court explained what affects substantive rights by stating: "After-enacted legislation that increases or diminishes the amount of recoverable compensation or alters the elements of the claim or defense by imposition of new conditions affects the parties' substantive rights and liabilities." Id. ¶ 15, 78 P.3d at 548. The Court found that the after-enacted legislative amendments affected the claimant's amount of recoverable benefits and would subject a claim to a liability-defeating defense that is more potent than that which was in effect when the claim was filed." Id. ¶ 16, 78 P.3d at 549. Therefore, the statute operated on substantive rights and was not subject to retroactive application. Id. ¶22 Pursuant to the AWCA, PPD shall be stated in terms of a percentage, not weeks.12 Weeks are used to determine the value of the benefit based on a baseline 100% impairment. The maximum percentage of impairment--100%--has remained the consistent limitation on PPD, despite the fluctuation in the maximum allowable number of weeks. At first, there was no weekly limitation. Then, a 520 week maximum was implemented. Next, the maximum number of weeks decreased from 520 to 350. Now, during the pendency of this appeal, the maximum number of weeks has increased to 360.13 Respondent asks that we disregard the consistent 100% limitation in favor of the inconsistent weekly limitation. If we take this position, Cantwell would not be subject to the 100% limitation equally applicable to all claimants that Rivas found constitutionally permissible. Instead, Cantwell would be limited to 71.3% despite the stated cap of 100% in both Title 85 and AWCA.14 This interpretation is constitutionally impermissible. ¶23 Further, "[a]ll aspects of the adjudication of claims for injuries occurring prior to February 1, 2014, are governed by the law in effect at the time of the injury." Carlock v. Workers' Compensation Comm'n, 2014 OK 29, ¶ 2, 324 P.3d 408; 85A O.S. Supp. 2014, § 400(L)--(N).15 For injuries occurring after February 1, 2014, the AWCA is controlling. Under both Title 85 and the AWCA, Cantwell is entitled to 100% impairment to any body part or the body as a whole. Here, the after-enacted legislative limitation in Section 46(H) construed without consideration of Section 45(C)(1), subjects Cantwell's claim to the liability-defeating defense that his right to PPD is limited solely by weeks rather than the 100% PPD limitation. Cantwell has a substantive right to 100% PPD. ¶24 In Schlumberger Technology Corp. v. Paredes, 2023 OK 42, ¶ 15, 528 P.3d 772, 778, we stated: "This Court's precedent directs that where there are two possible interpretations in the construction of a statute, one of which would render the statute unconstitutional, the Court should adopt the construction which upholds the statute, unless the repugnancy to the constitution is shown beyond a reasonable doubt." (citation omitted). If we were to uphold the Commission's application of Section 46(H) in this case, relying only on the weekly cap on PPD benefits and disregarding the 100% requirement of 45(C)(1), it would affect Cantwell's substantive right. Such application would be a retroactive application of a law affecting a substantive right and would violate Article V, Section 54 of the Oklahoma Constitution prohibiting such application.16 If, however, we hold that all claimants must be subject to the same 100% limitation on PPD, and that 100% controls over weeks when a claimant has received a compensable award under both Title 85 and Title 85A, we are able to construe these two statutes together in order to avoid constitutional infirmity. As it is our duty to avoid such infirmity, we adopt this construction. Conclusion ¶25 Throughout the past 30 years, the 100% limitation on PPD benefits has been the floor for payment of PPD benefits and has remained the same for every claimant. In this case, the Commission's application of Section 46(H), without consideration of Section 45(C)(1), capped Cantwell's benefits at the amount he had previously received, a total of 71.3%. The Commission's retroactive application of Section 46(H) affects Cantwell's substantive right to 100% impairment under both Title 85 and the AWCA. If upheld, this application of Section 46(H) violates Article V, Section 54 of the Oklahoma Constitution. To avoid constitutional infirmity, we hold that the 100% limitation on PPD benefits controls over the number of weeks when awarding compensation for PPD where a claimant has both compensable awards for job related injuries that occurred prior to February 1, 2014 and compensable awards for job related injuries occurring after February 1, 2014. OKLAHOMA WORKERS' COMPENSATION COMMISSION VACATED; CASE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. KAUGER, EDMONDSON, COMBS, GURICH, and DARBY, JJ., CONCUR. KANE, C.J., ROWE, V.C.J., KUEHN, J. (by separate writing), and GOREE, S.J., DISSENT. WINCHESTER, J., RECUSED. FOOTNOTES 1 Though Flex-N-Gate was self-insured at the time each claim was filed, the employer obtained coverage from the Hartford Accident and Indemnity Co. while Cantwell's claims were pending before the Commission. As both of Flex-N-Gate and Hartford Accident and Indemnity Co. are named Respondents, are represented by the same counsel, and their interests are aligned, for the purposes of this opinion, where arguments are made by Flex-N-Gate as Respondent, it also necessarily includes Hartford Accident and Indemnity Co. 2 First, 85 O.S. Supp. 2010, § 1.2 conveyed the statutory authority for the Workers' Compensation Court. Section 1.2 was repealed in 2011, and it was replaced by 85 O.S.2011, § 303. Section 303 was repealed in 2014 when the Workers' Compensation Court was dissolved pursuant to 85A O.S. Supp. 2013, § 400. 3 85A O.S. Supp. 2013, § 1 et seq. 4 85A O.S. Supp. 2013, § 27. 5 Id. 6 In 2011, the Workers' Compensation Act was repealed, re-enacted and renumbered as the Workers' Compensation Code, but was still found in Title 85. At that time, Section 22(7) was renumbered as Section 333. 7 85A O.S. Supp. 2013, § 3(C) states: "The Administrative Workers' Compensation Act shall apply only to claims for injuries and death based on accidents which occur on or after February 1, 2014." 85A O.S. Supp. 2013, § 3(D) states: "The Workers' Compensation Code in effect before February 1, 2014, shall govern all rights in respect to claims for injuries and death based on accidents occurring before February 1, 2014." 8 The Respondent did not appeal the percentages awarded by the ALJ in each of the three cases. The awards in each of the three cases are not disturbed on appeal, only the application of Section 46(H) to defeat payment of PPD benefits to Cantwell. 9 See, Williamson v. Weyerhaeuser Corp., 1984 OK CIV APP 47, 695 P.2d 890, for a discussion of pre-1978 limitations on PPD awards. 10 Notably, Cantwell does not assert that the AWCA offers the injured worker the right to seek an additional 100% PPD regardless of the amount of PPD received as a result of injuries sustained under Title 85. The COCA considered and rejected that proposal in Feeler v. City of Tulsa, 2021 OK CIV APP 45, 503 P.3d 430. The award and payment of PPD benefits was affirmed on appeal. Here, Cantwell is awarded PPD in each case but is paid nothing. However, to the extent Feeler conflicts with the decision in the case at bar, it is overruled. 11 The opinion did not discuss whether Rivas had reached the 520 week limitation, nor was there any calculation as to how many weeks of PPD benefits Rivas had already been awarded. 12 Title 85A, Section 45(C)(1) provides: Any claim by an employee for compensation for permanent partial disability must be supported by competent medical testimony of a medical doctor, osteopathic physician, or chiropractor, and shall be supported by objective medical findings, as defined in this act. The opinion of the physician shall include employee's percentage of permanent partial disability and whether or not the disability is job-related and caused by the accidental injury or occupational disease. 85A O.S. Supp. 2019, 45(C)(1) (emphasis added). 13 85A O.S. Supp. 2019, § 45(C)(4). 14 Cantwell's PPD awards in these three cases exceed 28.6%, so he would not receive the value of the awards in all 3 cases, but would rather be subject to the 100% whole body impairment limitation. 15 The 2014 version of Title 85A, Section 400(L)--(M) states: L. For an injury occurring before the effective date of this act, all benefits and procedures to obtain benefits shall be determined by the workers' compensation law of this state in effect on the date of the injury. Administrative law judges of the Commission shall enforce all final orders of the Workers' Compensation Court in a manner to secure for all parties the due process and equal protection guarantees of the Constitution of the State of Oklahoma. M. All accrued rights and penalties incurred pursuant to a final order of the Workers' Compensation Court shall be preserved. Administrative law judges of the Commission shall be authorized to issue orders and conduct legal proceedings to enforce all such accrued rights and penalties incurred. No accrued right, penalty incurred, or proceeding begun by virtue of a statute repealed by this act shall be abrogated by the terms of this act. 85A O.S. Supp. 2014, § 400(L)--(M) (emphasis added). Section 400(N), which was amended in 2019, states: N. For an injury occurring before February 1, 2014, all benefits and procedures to obtain benefits shall be determined by the workers' compensation law of this state in effect on the date of the injury. 85A O.S. Supp. 2019, § 400(N) (emphasis added). The amendments in 2021 did not change this provision. 16 Because we decide this case pursuant to Article 5, Section 54, we do not address the other constitutional arguments asserted by Cantwell. KUEHN, J., with whom KANE, C.J., and ROWE, V.C.J., join DISSENTING: ¶1 I disagree with the Majority's interpretation of the interplay between the provisions of the workers' compensation statutes. Everyone agrees that Petitioner's injuries in this case all occurred after Title 85A was enacted in 2013. For this reason, I believe the Title 85A provisions apply. The Majority's holding is based on the idea that the disability percentage and weeks of benefits limitation provisions of Sections 45(C)(1) and 46(H) of Title 85A cannot be read together while giving full effect to each. I disagree. ¶2 Specifically, the Majority holds that until Petitioner reaches 100% permanent partial disability (PPD), the statutory limitation on how many weeks of benefits he may receive does not apply. That is, the Majority reconciles the statutes by disregarding one of the provisions. I don't believe that is what the Legislature intended. ¶3 In 2013, the Legislature significantly revised the entire workers' compensation scheme. As the Majority says, Title 85 (the previous statutes) and Title 85A (the Administrative Workers' Compensation Act, currently in effect) each provide that permanent partial disability awards will not exceed one hundred percent (100%) permanent partial disability for any individual claimant. 85 O.S. Supp.2010, § 22(7) ("the sum" of all awards to any claimant); 85A O.S. Supp.2013, § 45(C)(1) (a claimant's PPD award "or combination of awards"). That is, the 100% PPD requirement operates as a ceiling; a claimant cannot be paid benefits for more than a 100% PPD rating. Both statutes limit payment of PPD benefits to a certain number of weeks. Before 2013, Title 85 capped them at 520 weeks; at the time of Petitioner's injuries, the cap was 350 weeks. 85 O.S. Supp.2010, § 22(7); 85A O.S. Supp.2013, § 45(C)(4). ¶4 When the Legislature replaced Title 85 with Title 85A, it did not intend for a claimant's disability percentage or weeks of benefits calculations to start over. "In the event there exists a previous permanent partial disability.... compensation for permanent partial disability shall be only for such amount as was caused by such accidental personal injury or occupational disease and no additional compensation shall be allowed for the pre-existing disability or impairment." 85A O.S. Supp.2013, § 45(C)(6). The statute also provided that, if a claimant had a previous award of workers' compensation benefits, the percentage basis of that award conclusively established the amount of preexisting PPD. 85A O.S.Supp.2013, § 45(C)(6)(a). ¶5 Since Title 85A was newly enacted, any "previous award" must have been granted under the old statute, Title 85. And in enacting the Title 85A weeks of benefits cap, the Legislature provided, "The sum of all permanent partial disability awards...shall not exceed three hundred fifty (350) weeks." 85A O.S.Supp.2013, § 46(H) (emphasis added). That is, the weeks of benefits calculation did not start from zero for injuries incurred after 2013. The parties stipulated that between 1992 and 2010, Petitioner was awarded 71.3% PPD, and that he was paid 360 weeks of benefits. Thus, when Petitioner made the claims at issue here, he did not start with a clean slate. ¶6 The plain language of Sections 45(C) and 46(H) of Title 85A, read together, provide that Petitioner may receive PPD awards until he reaches a 100% PPD rating, but may not be paid benefits for more than 350 weeks. It is undisputed that, while he had not yet reached a 100% PPD rating, Petitioner had already been paid for 360 weeks of benefits before he filed for compensation for these injuries. That exceeded the weeks allowed under Title 85A. Period. The administrative law judge and Worker's Compensation Commission recognized that the statutory limitation was met, and they were without authority to pay Petitioner further benefits. ¶7 But the Majority does not give effect to the new benefits limitations which are an integral part of Title 85A. Instead, the Majority assumes without attribution that the 100% PPD clause is not a ceiling, but a floor. That is, until any claimant has been declared 100% PPD, the Majority holds that there is no limit on the weeks of benefits he may receive. This is not supported by the plain language of the statute, which clearly says any PPD award "may not exceed" a 100% PPD rating. 85A O.S.Supp.2013, § 45(C)(1). It is also inconsistent with the Workers' Compensation Commission's own practice around PPD awards. The Commission provides a standard estimated benefits computation chart showing the weeks and benefit amount for percentages of PPD from one percent to 100%, as determined by a doctor. According to the chart, 100% PPD is the maximum percentage that can be awarded, and weeks of benefits are counted starting at one percent PPD. Clearly, in practice, a claimant does not have to reach 100% PPD to trigger the Section 46(H) weeks of benefits limitation. ¶8 The Majority's interpretation of the interplay between Sections 45 and 46 of Title 85A has no support in the language or the law. The Majority justifies this by declaring that without this interpretation, the statute must be held unconstitutional. The Majority creates a statutory conflict and rewrites the statutes in favor of Petitioner, under the pretense that this will avoid a constitutional issue that does not exist. In doing so, the Majority says that the Section 46(H) weeks cap cannot be applied to Petitioner because it is an after-enacted statute, but it is not. ¶9 As the Majority explains, a claimant's right to compensation is governed by the law in effect at the time of his injury, because that law "determines the substantive rights and obligations of the parties." Cole v. Silverado Foods, Inc., 2003 OK 81, ¶ 7, 78 P.3d 542, 546. [Majority Op. ¶ 21] And, we cannot retroactively apply a subsequent statutory amendment which diminishes the amount of benefits that may be paid. Id. But by this definition Section 46(H) is not after-enacted. Everyone agrees that Petitioner's injuries in these cases were after 2013, Section 46(H) was already in place, and it applies to him. Everyone agrees Petitioner had vested rights under Title 85 and received benefits under those rights. Everyone also agrees that he had vested rights under Title 85A, and that he is entitled to compensation for these injuries under those vested rights to the extent the statute allows him to be paid benefits. This is a textbook example of applying the statute in effect at the time of the injury. ¶10 The Majority apparently believes Section 46(H) should be treated as after-enacted because its weeks of benefits provision is smaller than the 520 weeks available under Title 85. The Majority does not fully distinguish between applying the 350-week cap to injuries occurring before 2013 -- which would be retroactive and improper -- and applying it to injuries occurring after 2013. Rather, it appears to argue that any weeks of benefits paid under the terms of the former statute in Title 85 simply do not exist for purposes of the current award calculation. That is, the Majority doesn't complain that the current 350-week cap is being applied retroactively; it may instead be suggesting that the previous statute's 520-week cap should carry forward and be applied to the current claims. Whatever that is, it isn't a retroactive application of an after-enacted statute. The Majority suggests that Petitioner's 360 previously paid weeks of benefits from his previous injuries, all under Title 85, cannot be counted towards the limitation of benefits in Section 46(H). But the language in Section 46(H), "the sum of all permanent partial disability awards," clearly states that we can consider Petitioner's previous awards, and in fact we must. 85A O.S.Supp.2013, § 46(H). ¶11 Section 46(A) is not after-enacted and its application here is not unconstitutional. There is no support in statute or case law to require a claimant to reach 100% PPD before benefits may be limited by weeks paid. There is no need to reconcile the provisions of Sections 45(C) and 46(H), which complement one another. In enacting Title 85A the Legislature chose to put significant limitations on any claimant's ability to receive permanent partial disability awards. These include the requirement that nobody may receive benefits who is more than 100% PPD, and that in any event, in Petitioner's circumstances, no benefits may be paid for any percentage of PPD for more than 350 weeks, including any weeks of benefits which he may already have received. I recognize that these limitations may, as here, result in harsh consequences in individual cases. But where the legislative language is clear -- as it is here -- it is not this Court's job to parse the statutes to escape those consequences. I dissent.

4e28eedc-c033-43b8-97ed-883a2122768b

Cathey v. McCurtain County Bd. of County Comm'rs

oklahoma

Oklahoma Supreme Court

CATHEY v. BOARD OF COUNTY COMMISSIONERS FOR MCCURTAIN COUNTY2023 OK 108Case Number: 121465Decided: 11/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MICHAEL W. CATHEY, and VONDEROSA PROPERTIES, LLC, Plaintiffs/Appellants,v, THE BOARD OF COUNTY COMMISSIONERS FOR MCCURTAIN COUNTY, OKLAHOMA, Defendant/Appellee,andMCCURTAIN MEMORIAL MEDICAL MANAGEMENT, INC., d/b/a MCCURTAIN MEMORIAL HOSPITAL, Intervenor/Appellee. ON APPEAL FROM THE DISTRICT COURT OF MCCURTAIN COUNTY,STATE OF OKLAHOMAHONORABLE EMILY MAXWELL, DISTRICT JUDGE ¶0 Plaintiffs/Appellants Michael W. Cathey and Vonderosa Properties, LLC (collectively "Vonderosa") filed suit seeking declaratory relief against Defendant/Appellee Board of County Commissioners for McCurtain County (Board) and moved for a temporary injunction to restrain and enjoin the Board from enforcing and collecting a lodging tax increase passed at a special election held in McCurtain County on November 8, 2022, in conjunction with the general election. The district court denied Vonderosa's request for a temporary injunction and Vonderosa appealed, seeking emergency relief from this Court in Case No. 121,155. On March 28, 2023, this Court entered an Order temporarily enjoining enforcement of the 2% increase to the lodging tax until the special election is fully and finally litigated. This Court expressed no opinion concerning the validity of the special election in its emergency Order. While Appellee's petition for rehearing was still pending before this Court in Case No. 121,155 and before the mandate issued, the district court granted Appellee/Intervenor's Motion for Summary Judgment and held the special election was valid. We hold that under the facts of this specific case the district court was without jurisdiction to enter summary judgment for Appellee while the appeal was pending in this Court and before mandate had issued. The District Court's Order of June 20, 2023 is void for lack of jurisdiction and said Order is vacated. The case is remanded to the district court with instructions. JUDGMENT OF THE DISTRICT COURT IS VACATED, AND REMANDED WITH INSTRUCTIONS. Jana L. Knott, Bass Law, Oklahoma City, Oklahoma, and Lysbeth George, Liz George and Associates, Oklahoma City, Oklahoma, for Appellants. David Floyd, Floyd & Driver, PLLC, Norman, Oklahoma, and Mark Matloff, McCurtain County District Attorney, McCurtain County, Oklahoma, for Appellee. Harvey D. Ellis, Jr., Lauren E. Kiefner, Crowe & Dunlevy, Oklahoma City, Oklahoma, and J. Christopher Davis, Becky Allen, Crowe & Dunlevy, Tulsa, Oklahoma, for Intervenor/Appellee. KANE, C.J.: ¶1 This case concerns a special election held in McCurtain County on November 8, 2022, in conjunction with a general election wherein the Board of County Commissioners of McCurtain County set forth a Proposition to the voters to increase the county lodging tax by 2% for the purpose of building a new hospital in McCurtain County. On appeal, the parties argue whether the notice requirements for publication of the Proposition were properly published as required by Oklahoma law. However, before we can reach the merits raised by the parties on appeal, we must first address our jurisdiction and the district court's jurisdiction (or lack thereof) in this case. Specifically, on March 28, 2023, this Court entered an Order enjoining the lodging tax at issue until the validity of the special election is fully and finally litigated in Case No. 121,155. See Order dated March 28, 2023. Despite this Order and without waiting for the disposition of the same, the District Court of McCurtain County (District Court) granted summary judgment to Appellee on June 20, 2023 in the case below (Case No. CV-2023-26), finding the special election was valid and that the increased lodging tax was enforceable. See Order dated June 20, 2023. The District Court's Journal Entry of Judgment was entered before the petition for rehearing was adjudicated and before mandate was issued in Case No. 121,155. Thus, the question becomes whether the District Court had jurisdiction to enter summary judgment or whether it was divested of jurisdiction once the appeal was pending before this Court. PARTIES ¶2 Plaintiffs/Appellants Vonderosa Properties, LLC and Michael Cathey (collectively "Vonderosa") own real property within Hochatown, McCurtain County, Oklahoma, which property is operated as rental property and thereby subject to McCurtain County lodging taxes, which is the subject of this lawsuit. As the owner(s) of the rental property, Vonderosa is required to collect and remit the lodging tax. ¶3 Defendant/Appellee, the Board of County Commissioners for McCurtain County (Board), is the governmental body that adopted the resolution calling for the special election regarding the lodging tax increase. ¶4 Intervenor/Appellee, McCurtain Memorial Medical Management, Inc. d/b/a McCurtain Memorial Hospital (Hospital), is the intended recipient of the increased lodging tax should the Proposition be found valid and enforceable on appeal. The Hospital filed an Emergency Motion to Intervene as a Third-Party Plaintiff in the underlying case on February 23, 2023. The Board filed a motion to consolidate the two cases; which the district court ultimately consolidated. BACKGROUND FACTS ¶5 The existing county lodging tax in McCurtain County, Oklahoma is 3%. ¶6 In 2020, the Board attempted to pass a lodging tax increase for the purpose of raising funds to build a new hospital in McCurtain County. ¶7 Although the Proposition passed, the Board failed to publish notice of the special election for four weeks in a newspaper in McCurtain County as is required by statute. See 19 O.S. § 383.1 PROCEDURAL HISTORY ¶8 On February 16, 2023, Plaintiffs/Appellants Michael W. Cathey and Vonderosa Properties, LLC filed suit seeking declaratory relief against Defendant/Appellee Board of County Commissioners for McCurtain County and moved for a temporary injunction to restrain and enjoin the Board from enforcing and collecting a lodging tax increase passed at a special election held in McCurtain County on November 8, 2022, in conjunction with the general election. ¶9 The District Court in McCurtain County held a hearing on Vonderosa's Motion for Temporary Injunction on March 8, 2023, wherein the Chairman of the Board testified the Board did not publish notice as required by statute. The Chairman testified he was not even aware of the statutory publication requirements until Vonderosa filed the present lawsuit. It is undisputed that no attempt was made by the Board to follow the mandatory statutory directive regarding publication of notice of the special election as set forth in 19 O.S. § 383. ¶10 On March 13, 2023, the district court denied Vonderosa's request for a temporary injunction, and Vonderosa appealed, seeking emergency relief from this Court in Case No. 121,155. Hospital filed an emergency motion to intervene, as the recipient of the increased lodging tax and the Board filed a motion to consolidate the two cases (requesting consolidation of Case No. CV-2023-26 with Case No. CJ-2023-18). The district court granted the motion to consolidate. ¶11 On March 21, 2023, the Clerk of the Appellate Courts filed his Certificate of Appeal in the Court Clerk's Office in McCurtain County certifying that on March 16, 2023, a Petition in Error was filed in the Supreme Court of the State of Oklahoma, in Cathey v. Board of County Commissions for McCurtain County, Lower Court No. CV-2023-26, certifying that said case was duly entered on the docket, numbered IN-121155. The Designation of Record for Appeal was filed in the district court on March 21, 2023. ¶12 Both Hospital and the Board filed responses in opposition to Vonderosa's Emergency Motion for Relief on March 21, 2023. After oral presentation was held, this Court entered judgment as to the emergency relief in Case No. 121,155 on March 28, 2023, as follows: Plaintiffs/Appellants Michael W. Cathey and Vonderosa Properties, LLC's Emergency Motion for Relief is granted. Title 12 O.S. 2021 § 990.4(C); Okla. Coalition for Reproductive Justice v. Cline, 2014 OK 91, ¶ 1, 339 P.3d 887. Upon consideration of Appellants' motion, and pursuant to the authority provided by Article 7, section 4, of the Oklahoma Constitution, this Court temporarily enjoins enforcement of the 2% increase to the lodging tax in McCurtain County approved by voters in the special election held on November 8, 2022. The injunction shall remain in place until the validity of the special election is fully and finally litigated. See Cline, 2014 OK 91, at ¶ 1. This Court expresses no opinion concerning the validity of the special election. See Order dated March 28, 2023, Case No. 121,155. ¶13 On April 12, 2023, Hospital filed its petition for rehearing in Case No. 121,155. ¶14 Meanwhile, in this underlying case (CV-2023-26), Hospital filed a motion for leave to file a third-party petition and a request for expedited briefing schedule in the district court, which the district court granted on April 24, 2023. ¶15 Thereafter, the parties entered into an agreed amended scheduling order in the district court on April 28, 2023, which set a dispositive motions deadline of May 10, 2023. The district court then issued its order for mediation providing a mediation deadline of June 7, 2023. ¶16 On May 10, 2023, Hospital filed its Amended Motion for Summary Judgment. On May 11, 2023, Vonderosa filed its Motion for Summary Judgment, as well as its Response to Hospital's Motion for Leave to file Third-Party Petition. ¶17 On May 23, 2023, McCurtain County Memorial Hospital filed its Reply Supporting its Motion for Leave to file Third-Party Petition and its Response to Plaintiffs' Motion for Summary Judgment and Brief in Support. On May 25, 2023, the Board filed its Response in Objection to Plaintiffs' Motion for Summary Judgment and Vonderosa filed its Response to Hospital's Motion for Summary Judgment. ¶18 On May 31, 2023, Hospital filed its Reply in Support of Amended Motion for Summary Judgment. Vonderosa then filed its Combined Reply in Support of Plaintiffs' Motion for Summary Judgment on May 31, 2023, to address both the response filed by Hospital and the response filed by the Board on May 25, 2023. ¶19 The District Court then entered its Journal Entry of Judgment on June 20, 2023, granting Hospital's Motion for Summary Judgment and finding the Proposition (held in McCurtain County on November 8, 2022 concerning the two percent (2%) lodging tax increase) valid, approved by the electorate, and upheld by the court. It is from this Order granting summary judgment that Vonderosa appeals to this Court in Case No. 121,465. ¶20 However, after summary judgment was granted, this Court denied Hospital's petition for rehearing on June 26, 2023 in Case No. 121,155. Likewise, after the summary judgment Order was entered on June 20, 2023, mandate was issued on September 13, 2023 in Case No. 121,155. Under the Facts of this Case the District Court Does Not Have Jurisdiction Until Mandate Issues from the Supreme Court ¶21 This Court has "recognized . . . the long standing rule that while an appeal is pending in the appellate courts, the district court is without jurisdiction to make any order materially affecting the rights of the parties to that appeal." Daniel v. Daniel, 2001 OK 117, ¶ 11, 42 P.3d 863, 867. Any such order issued contrary to this rule is "void." Id. Said another away, absent compliance with limited exceptions regarding correcting, modifying or vacating judgments found at 12 O.S. § 1031.12 if the trial court exercises its jurisdiction within 30 days, "the trial court loses its jurisdiction to make any order that pertains to the same issues on appeal." Id. ¶22 The Oklahoma Supreme Court Rules provide further guidance and authorize the Chief Justice of the Supreme Court to issue mandate to the lower court upon the conclusion of the matter on appeal.3 The mandate from the Supreme Court is an order requiring the lower tribunal to comply with an appellate opinion and it carries with it the authority for the trial court to proceed. See Daniel, 2001 OK 117, ¶ 12, 42 P.3d at 868. Importantly, "[w]hen a cause is pending on appeal, a district court's exercise of judicial power with respect to issues which are tendered for review in the appellate forum is ineffectual if it occurs before the mandate has been transmitted to revest the trial court with subject matter jurisdiction." Id. ¶ 12, at 868 (emphasis added). ¶23 Under the unique facts of this case, it is clear that the District Court did not have jurisdiction on June 20, 2023, to enter summary judgment for Hospital and to hold that the special election was valid, and that the increased lodging tax was enforceable. While Hospital's petition for rehearing in Case No. 121,155 was filed on April 12, 2023 before summary judgment was granted, the District Court's Journal Entry of Judgment was entered before the petition for rehearing was adjudicated in this Court and before mandate was issued by this Court in Case No. 121,155. As such, the District Court was divested of jurisdiction and its June 20, 2023 Order is void. See Daniel, 2001 OK 117, at ¶¶ 11-12, 42 P.3d at 867-68. When the District Court issued its Summary Judgment Order of June 20, 2023, this Court had exclusive jurisdiction over the appeal as to "any orders materially affecting the rights of the parties to that appeal" and any attempt to immediately enforce the district court's order would be an impermissible superceding of this Court's rules in violation of Okla. Const. art. 7 §§ 4 and 6.4 See Daniel, 2001 OK 117, ¶ 11, 42 P.3d at 867. However, this does not mean that the District Court loses jurisdiction indefinitely. In this case, mandate was issued on September 13, 2023, thus returning jurisdiction to the District Court. CONCLUSION ¶24 There is no authority provided by statute or by the rules and practices of this Court which would allow the district court to supercede our rules. The district court did not have jurisdiction to enter summary judgment until the issuance of the mandate. The District Court's Order of June 20, 2023 is vacated, and the cause is remanded with instructions. ORDER OF THE DISTRICT COURT IS VACATED, AND REMANDED WITH INSTRUCTIONS. CONCUR: Kane, C.J., Rowe, V.C.J., Edmondson, Gurich, Darby, and Kuehn, JJ. DISSENT: Kauger, Winchester, and Combs, JJ. FOOTNOTES 1 19 O.S. § 383 provides: The mode of submitting questions to the people contemplated by the last two sections shall be the following: The whole question, including the sum desired to be raised, the amount of tax desired to be authorized, the rate per annum, and the whole regulation, including the time of its taking effect or having operation, if it be of a nature which can be set forth, and the penalty of its violation if there be one, is to be published at least four (4) weeks in some newspaper published in the county. If there be no such newspaper, the publication is to be made by posting up in at least one of the most public places in each election precinct in the county; and in all cases the notices shall name the time when such question will be voted upon, and the form in which the question shall be taken, and a copy of the question submitted shall be posted up at each place of voting during the day of election. 2 12 O.S.2021 § 1031.1 provides: A court may correct, open, modify or vacate a judgment, decree, or appealable order on its own initiative not later than thirty (30) days after the judgment, decree, or appealable order prepared in conformance with Section 696.3 of this title has been filed with the court clerk. Notice of the court's action shall be given as directed by the court to all affected parties . . . 3 Rule 1.16, Oklahoma Supreme Court Rules, 12 O.S.2001, Ch.15, App. 1 provides in pertinent part: In every appeal or petition to review any order of a district court or other tribunal, a mandate will be issued to the lower court or tribunal on order of the Chief Justice upon conclusion of the matter on appeal. The mandate may be issued seven (7) days after the filing of an order denying certiorari or rehearing in the Supreme Court, or immediately upon expiration of time to file a petition for writ of certiorari or petition for rehearing, and disposition of any timely filed post-decisional motion. No mandate is issued upon conclusion of original actions, questions certified by federal courts, bar disciplinary matters, or original proceedings on initiative or referendum petitions . . . 4 Okla. Const. art. XII, § 4 provides in pertinent part: The original jurisdiction of the Supreme Court shall extend to a general superintending control over all inferior courts and all Agencies, Commissions and Boards created by law. The Supreme Court, Court of Criminal Appeals in criminal matters and all other appellate courts shall have power to issue, hear and determine writs of habeas corpus, mandamus, quo warranto, certiorari, prohibition and such other remedial writs as may be provided by law and may exercise such other and further jurisdiction as may be conferred by statute . . . . The appellate and the original jurisdiction of the Supreme Court and all other appellate courts shall be invoked in the manner provided by law. Okla. Const. art. VII, § 6 provides in pertinent part: Except with reference to the Senate sitting as a Court of Impeachment and the Court on the Judiciary, general administrative authority over all courts in this State . . . is hereby vested in the Supreme Court and shall be exercised by the Chief Justice in accordance with its rules . . . . Okla. Const. art. VII. § 1 provides in pertinent part: The judicial power of this State shall be vested in the Senate, sitting as a Court of Impeachment, a Supreme Court, the Court of Criminal Appeals, the Court on the Judiciary, the State Industrial Court, the Court of Bank Review, the Court of Tax Review, and such intermediate appellate courts as may be provided by statute . . .

662d526c-fc86-442f-81c4-2660684abeeb

IN THE MATTER OF THE ADOPTION OF A.J.B.

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ADOPTION OF A.J.B.2023 OK 122Case Number: 120431Decided: 12/19/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE ADOPTION OF A.J.B., a minor child: WILLIAM E. BARNES and HANNAH A. BARNES, husband and wife, Appellants,v.ZACHARY WAYNE BARBEE, Appellee. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 This is an action by the mother of a child born out of wedlock and her husband to adopt the child without the consent of the natural father. The trial court denied the adoption without consent holding the petitioners' evidence was insufficient. The Oklahoma Court of Civil Appeals vacated the judgment but agreed with the trial court that there was no clear and convincing evidence father willfully failed to support the child. The matter was remanded for an evidentiary hearing on the father's defenses to allegations he failed to maintain a relationship with the child. The father petitioned this Court for certiorari which was previously granted. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALSOPINION VACATED; TRIAL COURT JUDGMENT AFFIRMED Jeremy S. Elliot, Jeremy S. Elliot, Inc., Durant, Oklahoma for Appellants D. Michael Haggerty, II, Haggerty Law Office, Madill, Oklahoma for Appellee OPINION COMBS, J.: ¶1 The dispositive issue before us is whether the trial court abused its discretion in determining there was insufficient evidence to grant an adoption without consent of the natural father on the allegation he failed to establish or maintain a relationship with his child. We hold the trial court did not abuse its discretion. I. BACKGROUND AND PROCEDURAL HISTORY ¶2 The appellant, Hannah A. Barnes (Barnes) and the appellee, Zachary Wayne Barbee (Barbee) produced a child out of wedlock (A.J.B.) who was born in September 2018 in the State of Texas. The couple split apart in May 2019 and Barnes moved to Durant, Oklahoma taking A.J.B. with her. In November 2019, Barnes brought A.J.B. to Texas to visit Barbee. The encounter ended with an argument, and it was the last time Barbee saw A.J.B. In February 2020, Barbee turned himself in to authorities on a controlled substance-related charge. He was incarcerated in Texas from February 14, 2020, to September 3, 2021. ¶3 In October 2020, Hannah married William E. Barnes (appellants). On February 8, 2021, while Barbee was incarcerated, the couple filed a Petition and an Application for Order Determining Child Eligible for Adoption Without Consent of Natural Father. The Application alleged Barbee had failed to contribute to the support of A.J.B. in excess of one year and maintain a substantial relationship with A.J.B. for at least 12 months and therefore his consent to their adoption of A.J.B. was unnecessary. Barbee received service on March 9, 2021, while incarcerated, and filed an answer/letter dated March 10, 2021, which was filed in the case on March 15, 2021. His answer/letter contested the proceedings and informed the court he would be released soon and upon his release he would be able to do all that was needed to support his daughter. On April 7, 2021, the trial court held that Barbee was indigent and appointed Michael Haggerty, II, to represent him in this matter. ¶4 On April 25, 2022, a hearing was held on the appellants' Application. The appellants' attorney called only two witnesses, Hannah A. Barnes and Zachary Wayne Barbee. Barbee's attorney called no witnesses but cross-examined appellants' witnesses. Barnes testified that she had notified Barbee by phone that she had moved to Durant, Oklahoma in October 2019 and the November 2019 meeting occurred after Barbee contacted her on social media. She testified that she had never given Barbee her home address and after the November 2019 meeting she blocked him on her phone as well as social media so he could not contact her. She further testified that Barbee had no other way to contact her. Her reasoning for blocking him was that she was afraid of Barbee. Barnes claimed to have sought child support from Barbee through the Oklahoma Child Support Enforcement Division and she claimed she informed Barbee of this in October 2019. However, no case number or documents were presented to support this allegation, and Barbee testified he had never been served with any child support papers. The only documents he was served concerned the present action while he was incarcerated and there was no difficulty quickly serving him those documents as seen by the record. ¶5 Barbee testified he did not know of any child support proceedings in Oklahoma and was never served any documents related to such proceedings. He first testified that he only learned Barnes had moved to Oklahoma when he was served the documents related to the present case. However, his testimony later changed: Q: Did you try to contact Ms. Barnes between November [2019] and February [2020]?....Q: Okay. So you knew she was in Oklahoma, at that time?A: At that time, yes.Q: Okay. Did you know she was in Durant?A: I didn't know that -- yes, sir, I knew. I knew -- I wasn't aware that she'd fully moved, until.Q: But you were aware she was in Durant?A: Yes, sir. (April 25, 2022 hearing: Tr. 28, 1-2; Tr. 29, 4-10). Barbee was asked if he had tried to provide child support to A.J.B. either through Texas or Oklahoma. He claimed he had contacted the Henderson County, Texas court clerk but he didn't have necessary information, such as a social security number, and never filed anything formally. He did testify that following his incarceration he has been employed as an iron worker and more than willing to begin paying child support. His testimony reflects he had not seen A.J. B. since the November 2019 meeting and had not provided support; he did not know an address where to send any payments for support and did not have a way to contact A.J.B. He further testified that even if he had a phone number he would not have been able to call A.J.B. while incarcerated. ¶6 After appellants rested their case, Barbee's attorney offered a demurrer to the evidence arguing the evidence presented was insufficient to support an adoption without the consent of the natural father. Barbee's attorney did not present any additional evidence or a case in chief and after all closing arguments and all evidence had been presented the trial court ruled on the demurrer. The trial court sustained the demurrer and denied the adoption without the consent of the natural father. A Journal Entry of Judgment was filed on April 28, 2022. The judgment provided the "Petitioner's evidence is insufficient to sustain their Application for adoption without consent" and was therefore denied. The Petition for adoption was also denied. ¶7 The appellants filed a Petition in Error on May 18, 2022. The Oklahoma Court of Civil Appeals (COCA) issued an unpublished opinion on June 2, 2023. It agreed with the trial court's ruling that there was insufficient evidence that Barbee "willfully" failed to support A.J.B. during the requisite period. However, the court found the appellants had established a prima facie case that Barbee did not maintain a substantial and positive relationship with A.J.B. during such period. It vacated the judgment and remanded the matter to the trial court to allow Barbee an opportunity to "put on any evidence he may have in defense" on this issue. Judge Wiseman concurred in part and dissented in part. She found the majority's position was too stringent, "particularly when a parent's constitutional rights are at stake." She believed Barnes had "undercut" Barbee's relationship with A.J.B. while he was incarcerated and the trial court's decision was not contrary to the clear weight of the evidence. On June 22, 2023, Barbee filed a Petition for Certiorari with this Court which was granted on October 9, 2023. Barbee challenges the court's holding that the appellants had established a prima facie case he did not maintain a substantial and positive relationship with A.J.B. and the holding departed from existing precedent of this Court. II. STANDARD OF REVIEW ¶8 This Court has repeatedly recognized the right of a parent to the care, custody, companionship and management of his or her child is a fundamental right protected by the state and federal constitutions. Matter of Adoption of M.A.S., 2018 OK 1, ¶10, 419 P.3d 204, 208; In re Adoption of D.T.H., 1980 OK 119, ¶18, 615 P.2d 287, 290 (overruled on other grounds). The law presumes that both biological parents must consent before an adoption of their minor child may be effectuated. Matter of Adoption of M.A.S., 2018 OK 1, ¶10, 419 P.3d 204, 208. Adoption statutes in derogation of a biological parent's rights must be strictly construed in favor of the biological parent. Id. ¶11, at 208; Matter of Adoption of C.M.G., 1982 OK 156, ¶9, 656 P.2d 262, 265 ("Adoption statutes are in derogation of the natural rights of parents. They must be strictly construed."). The termination of such fundamental right calls for an application of the full panoply of procedural safeguards. Matter of Adoption of C.M.G., 1982 OK 156, ¶9, 656 P.2d at 265. The burden rests on the party seeking to destroy the parental bond to show why consent may be dispensed with. Id. ¶9 The standard of proof necessary to establish any of the grounds to permit adoption without consent, or for termination of parental rights, is clear and convincing evidence. Steltzlen v. Fritz., 2006 OK 20, ¶12, 134 P.3d 141, 145. Clear and convincing evidence is that measure or degree of proof which will produce in the mind of the trier of fact a firm belief or conviction as to the truth of the allegation sought to be established. Matter of Adoption of M.A.S., 2018 OK 1, ¶11, 419 P.3d 204, 208. Actions of equitable cognizance, where the trial court weighs the evidence and sustains the demurrer and enters judgment for the defendant, will not be disturbed on appeal unless clearly against the weight of the evidence. Looney v. Bruin Oil Corp., 1942 OK 67, ¶1, 122 P.2d 1007, 1008. In an action of equitable cognizance, the Supreme Court presumes the trial court's findings of fact are correct and will not disturb such findings on appeal unless they are clearly contrary to the weight of the evidence. Steltzlen, 2006 OK 20, ¶20, at 146-47, citing Pine Island RV Resort, Inc., v. Resort Management, Inc., 1996 OK 83, ¶18, 922 P.2d 609, 613. To reverse on the grounds of abuse of discretion, it must be found that the trial judge made a clearly erroneous conclusion and judgment, against reason and evidence. Oklahoma Turnpike Auth. v. Asher, 1993 OK 136, ¶7, 863 P.2d 1205, 1207. III. ANALYSIS ¶10 Title 10 O.S. § 7505-4.2 provides exceptions to the requirement that a parent must consent to an adoption. Subsection B provides: B. Consent to adoption is not required from a parent who, for a period of twelve (12) consecutive months out of the last fourteen (14) months immediately preceding the filing of a petition for adoption of a child or a petition to terminate parental rights pursuant to Section 7505-2.1 of this title, has willfully failed, refused, or neglected to contribute to the support of such minor: 1. In substantial compliance with an order entered by a court of competent jurisdiction adjudicating the duty, amount, and manner of support; or 2. According to such parent's financial ability to contribute to such minor's support if no provision for support is provided in an order. For the purposes of this section, support for the minor shall benefit the minor by providing a necessity. Payments that shall not be considered support shall include, but are not limited to: a. genetic and drug testing, b. supervised visitation, c. counseling for any person other than the minor, d. court fees and costs, e. restitution payments, and f. transportation costs for any person other than the minor, unless such transportation expenses are specifically ordered in lieu of support in a court order. The incarceration of a parent in and of itself shall not prevent the adoption of a minor without consent. In addition, subsection H provides: H. 1. Consent to adoption is not required from a parent who fails to establish and/or maintain a substantial and positive relationship with a minor for a period of twelve (12) consecutive months out of the last fourteen (14) months immediately preceding the filing of a petition for adoption of the child. 2. In any case where a parent of a minor claims that prior to the receipt of notice of the hearing provided for in Sections 7505-2.1 and 7505-4.1 of this title, such parent had been denied the opportunity to establish and/or maintain a substantial and positive relationship with the minor by the custodian of the minor, such parent shall prove to the satisfaction of the court that he or she has taken sufficient legal action to establish and/or maintain a substantial and positive relationship with the minor prior to the receipt of such notice. 3. For purposes of this subsection, "fails to establish and/or maintain a substantial and positive relationship" means the parent: a. has not maintained frequent and regular contact with the minor through frequent and regular visitation or frequent and regular communication to or with the minor, or b. has not exercised parental rights and responsibilities. The appellants have alleged that Barbee failed to provide for A.J.B. and maintain the required relationship with her during the relevant period provided in subsections B and H, i.e., during the twelve (12) consecutive months out of the last fourteen (14) months immediately preceding their filing of their petition for adoption. The petition for adoption was filed on February 8, 2021, therefore, the relevant period would be from December 8, 2019, through February 8, 2021. ¶11 As to the subsection B grounds for adoption without consent, COCA agreed with the trial court that there was not clear and convincing evidence that Barbee had "willfully" failed to provide support for A.J.B. during this period. Barbee is the one who filed the Petition for Certiorari and does not contest COCA's ruling on this matter. The appellees did not file a Petition for Certiorari and therefore the trial court's ruling on these grounds is affirmed. ¶12 COCA, however, found that subsection H does not contain a "willful" requirement and there was clear and convincing evidence that Barbee had no contact with A.J.B. during the requisite statutory period. It found that by granting a demurrer to the evidence the proceedings before the trial court did not go beyond the question as to whether the appellants established a prima facie case that A.J.B was potentially eligible for adoption without consent pursuant to subsection H. It held that the appellants established a prima facie case that A.J.B. was statutorily eligible for adoption without consent. It vacated the trial court's order and remanded the matter to afford Barbee a chance to put on any evidence of a defense as to the subsection H grounds for adoption without consent. Judge Wiseman dissented. She found that Barnes' efforts to undercut Barbee's established relationship with A.J.B. while he was incarcerated in another state made the likelihood of his pursuing any requisite legal action all but non-existent. She found the ruling too stringent and narrow when considering a parent's constitutional rights were at stake. ¶13 Prior to its 2001 amendment, 10 O.S. § 7505-4.2 (H) provided: H. Consent to adoption is not required from a parent who willfully fails to maintain a significant relationship with a minor for a period of twelve (12) consecutive months out of the last fourteen (14) months immediately preceding the filing of a petition for adoption of the child. This subsection was amended by H.B. 1670 in 2001 and removed the "willfully" language, among other things, and made other amendments in line with the present version. See 2001 Okla. Sess. Laws c. 434, § 8, emerg. eff. June 8, 2001. COCA focused on this amendment by acknowledging, that unlike subsection B of 10 O.S. § 7505-4.2, subsection H did not have this "willfully" language. However, a decision of this Court some five years after this amendment did not dwell upon that distinction. Barbee asserts in his Petition for Certiorari that COCA erred by not following precedent of this Court; namely, our decision in Steltzlen v. Fritz, 2006 OK 20, 134 P.3d 141. COCA did not address Steltzlen in its opinion even though Barbee had briefed the case. ¶14 In Steltzlen v. Fritz, 2006 OK 20, 134 P.3d 141, the father (Fritz) had a brief sexual encounter with a co-worker. The mother told Fritz that she had a boyfriend and soon thereafter she left her employment. She also told Fritz she was entering a witness protection program. Seven months later the two ran into each other and the mother was pregnant. The two talked about the pregnancy and the mother indicated it was possible that he was the father of the child (J.E.D.). Fritz offered to take a DNA test but the mother declined and he did not hear from the mother after that encounter. He assumed that he was not the father. The mother moved in with a friend and relinquished the care of J.E.D. to the friend and the friend's mother (Steltzlen). Over three years after the birth of J.E.D. the friend and Steltzlen filed a guardianship action and notified Fritz. Fritz testified this was the first time he learned he was the father. He immediately filed a paternity action and objected to the guardianship proceedings. The trial judge found there was no proof he was the father of J.E.D. and appointed Steltzlen as guardian. ¶15 Later, after a DNA test determined Fritz was the father of J.E.D., he moved to terminate the guardianship. Pending the motion, Steltzlen filed a petition for adoption and an application to adopt without the consent of the natural father. Steltzlen alleged Fritz failed to contribute to the support of J.E.D. for a period of twelve consecutive months out of the fourteen months immediately preceding the filing of the petition for adoption, and that he failed to maintain a substantial and positive relationship with J.E.D. for a period of six consecutive months out of the fourteen months immediately preceding the filing of the petition for adoption. The trial court denied the petition and application. It held Steltzlen had failed to meet the burden of proof necessary to establish Fritz's consent was not required. The trial court relied heavily on the fact that the mother had concealed the child. It specifically found "a prospective adoptive party cannot claim the benefit of 10 O.S. § 7505-4.2 when that party has actively concealed the existence and/or location of the child from the parent." Steltzlen, 2006 OK 20, ¶15, at 145. ¶16 On appeal, this Court unanimously affirmed the trial court's decision. We noted that in a similar case the mother's actions constituted a specific denial of knowledge of the child and such actions offered a complete defense to the termination of the natural father's parental rights. Id. ¶16, at 146; In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., 1999 OK 74, ¶15, 988 P.2d 1270, 1274. In In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., we determined a natural father did all he could reasonably have done under the circumstances and his conduct was sufficient where the natural mother failed to provide any information to the father concerning her pregnancy, and initially hid the father's identity from the court and adoption agency. In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., 1999 OK 74, ¶15, at 1274. Our inquiry in Steltzlen was to determine whether the trial court abused its discretion. We noted there is a presumption in favor of the trial court's findings in an action of equitable cognizance and we would not disturb such findings unless they are clearly contrary to the weight of the evidence. Steltzlen, 2006 OK 20, ¶20, at 146-147. We held there was evidence to support the trial court's ruling and we could not find that the decision constituted an abuse of the trial judge's discretion. Id. ¶21, at 147. ¶17 Unlike Steltzlen and In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., Barbee knew of the birth of A.J.B. and it appears from the record that Barnes and Barbee were a couple from her birth in September 2018 until they ended their relationship in May 2019. Barbee last saw A.J.B. in November 2019 and for twelve of the fourteen months prior to the filing of the petition and application, Barbee was incarcerated. Title 10 O.S. § 7505-4.2 (H) (2) provides that if a parent denies the opportunity to establish and/or maintain a substantial and positive relationship with the minor, the offended parent shall prove to the satisfaction of the court that he or she has taken sufficient legal action to establish such a relationship. In In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., we noted that the United States Supreme Court has held that only "[w]hen an unwed father demonstrates a full commitment to the responsibilities of parenthood by 'coming forward to participate in the rearing of his child' [does] his interest in personal contact with his child acquire substantial protection under the due process clause." In re Termination of the Parental Rights of the Biological Parents of Baby Boy W., 1999 OK 74, ¶10, at 1272, quoting Lehr v. Robertson, 463 U.S. 248, 261-62 (1983). There is no proof here that Barbee took any legal action to establish a relationship with A.J.B. during the statutory period prior to the filing of the petition and application. However, that fact alone should not be viewed in a vacuum. Adoption statutes in derogation of a biological parent's rights must be strictly construed in favor of the biological parent. Matter of Adoption of M.A.S., 2018 OK 1, ¶11, 419 P.3d 204, 208. The decision of the trial court in Steltzlen which forbid the termination of parental rights when the existence and/or location of the child had been concealed by the moving parent, is consistent with this principle. IV. CONCLUSION ¶18 Here, Barnes would not give Barbee her address. She blocked him on her phone and social media. Although his testimony was at times contradictory, it appears Barbee thought Barnes and A.J.B. were living somewhere in Durant, Oklahoma. That was all the information he had. Barnes intentionally concealed A.J.B.'s whereabouts from Barbee. The trial court made no specific finding as to the sufficiency of Barbee's legal efforts to establish a relationship with A.J.B. However, after hearing all the testimony and reviewing the evidence, it held the evidence was insufficient to sustain the petition for adoption and application for adoption without consent. We hold there was evidence to support the trial judge's ruling. His decision was not a clearly erroneous conclusion and judgment, against reason and evidence. Therefore, we do not find the ruling constitutes an abuse of discretion. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT JUDGMENT AFFIRMED Kauger, Winchester, Edmondson, Combs, Gurich, Darby (by separate writing), and Kuehn, JJ., concur; Kane, C.J., and Rowe, V.C.J., dissent. Darby, J., concurring specially: ¶1 I concur in the Opinion of the Court vacating the Court of Appeals Opinion and affirming the Trial Court Judgment. I do, however, want to address the wording used to describe what happened procedurally before the trial court. Barbee, the biological father, testified in Appellant's case in chief. On cross-examination the Trial Court allowed Barbee to testify to topics beyond the scope of direct. This allowed Barbee to in effect put on his case and his evidence during Applicant's case in chief. ¶2 When Appellants rested their case on the evidence presented, Barbee put on no additional evidence. The Trial Court orally announced that he was sustaining Barbee's demurrer to Appellants' evidence. But the Trial Court's written Journal Entry of Judgment filed April 28, 2022, contains no mention of a demurrer. The written Judgment only reflects that "Petitioners' (Appellants') evidence is insufficient to sustain their Application for adoption without consent, and so the Application should be and hereby is denied." ¶3 This distinction in wording is preferable because Barbee in fact presented his case, albeit before Appellants rested. Because this trial was before the court and not a jury the less accurate wording is harmless. ¶4 I concur specially in the Court's opinion.

d133a14d-80ae-4d80-96cd-9804c1653cbd

Accident Care & Treatment Center v. CSAA General Insurance Co.

oklahoma

Oklahoma Supreme Court

ACCIDENT CARE AND TREATMENT CENTER v. CSAA GENERAL INSURANCE CO.2023 OK 105Case Number: 119644Decided: 11/07/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ACCIDENT CARE AND TREATMENT CENTER, INC.; SOUTHWEST REGIONAL IMAGING AND RADIOLOGY, LLC; INJURY RECOVERY PHYSICAL THERAPY, LLC; and INTERVENTIONAL RADIOLOGY ASSOCIATES, LLC, Plaintiffs/Appellees,v.CSAA GENERAL INSURANCE COMPANY d/b/a AAA Insurance Company, Defendant/Appellant. ON WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 Medical providers sued insurance company to enforce their perfected medical liens for professional services rendered to a person injured in a car accident. Insurance company disputed the (1) reasonableness of the charges, and (2) necessity of the services. Medical providers argued that the insurance company had no legal standing to dispute these issues, absent an assignment from the injured party. Although Insurance company prepared the "Release" with the injured person, it failed to include such an assignment. Insurance company argued that in spite of this omission, there was an "implied" assignment from the injured party as evidenced by precontract settlement discussions. The trial court ruled that there was no assignment in the executed written release and that insurance company was barred by the Parol Evidence Rule from presenting evidence to establish an implied assignment. The Court of Civil Appeals reversed the trial court holding that summary judgment was not proper when there was a question of fact surrounding the issue of an assignment. We find there is no assignment in the executed release and further that there is no question of fact on material issues; we hold that without evidence of fraud, precontract negotiations and all discussions are merged into and superseded by the terms of an executed written release. The decision of the Court of Civil Appeals is vacated; and this matter is remanded to the trial court for proceedings consistent with this Opinion. COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF TRIAL COURT AFFIRMED; MATTER REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION T. Matthew Smith, Criterion Legal, Oklahoma City, Oklahoma, for Plaintiffs/Appellees, Accident Care and Treatment Center, Inc., Southwest Regional Imaging and Radiology, L.L.C., Injury Recovery Physical Therapy, L.L.C., and Interventional Radiology Associates, L.L.C. Austin R. Vance, Whitten Burrage, Oklahoma City, Oklahoma, for Plaintiffs/Appellees, Accident Care and Treatment Center, Inc., Southwest Regional Imaging and Radiology, L.L.C., Injury Recovery Physical Therapy, L.L.C., and Interventional Radiology Associates, L.L.C. Maurice G. Woods II, Kelsey A. Chilcoat, Oklahoma City, Oklahoma, for Defendant/Appellant, CSAA General Insurance Company d/b/a AAA Insurance Company Edmondson, J. ¶1 We are presented with the question of whether an insurance company that drafted a settlement release and failed to include language for an assignment, may introduce parol evidence to try and prove the Releasor/injured party assigned certain rights to insurance company giving it legal standing to dispute medical liens. We hold, absent fraud, a release which is in writing and where the parties affirmatively warranted "that no promise or inducement has been offered except as herein set forth," supersedes all oral stipulations or negotiations preceding its execution, and parol evidence is not admissible to modify or change the release. FACTS AND PROCEDURAL HISTORY ¶2 Medical Providers1 rendered medical care to Gayla Hamilton after she was injured in a car accident caused by the alleged negligence of others. Hamilton filed a claim with CSAA General Insurance Company, insurance carrier for the individuals allegedly responsible for the accident. It is undisputed that each of the named Medical Providers filed a "Notice of Medical Service Lien" against "AAA Claim # 1002-63-3017," the claim number assigned by CSAA for Hamilton's claim for injuries from this accident. It is undisputed that CSAA had actual notice of these liens. ¶3 CSAA and Hamilton arrived at a settlement, agreeing that an outright payment of Seven Thousand Five Hundred Dollars ($7,500.00) would be paid to Hamilton and separate payments were to be issued to each of the Medical Providers in amounts less than their filed medical liens. It is undisputed that CSAA did not have the consent of Medical Providers to reduce their medical liens. CSAA prepared the written release for Hamilton and was solely responsible for the terms. By signing the settlement contract, Hamilton agreed to release the alleged tortfeasors and their insurer, CSAA. CSAA also included the following paragraph noting that Hamilton warranted that the release was signed without any other promise or inducement: The Releasor [Hamilton] warrants that no promise or inducement has been offered except as herein set forth; that this release is executed without reliance upon any statement or representation by the person or parties released, or their representatives, their physicians, or any other person, concerning the nature and extent of the damage and consequential damages, if any, and of legal liability therefor, if any; and that the Releasor is of legal age, legally competent to execute this release and accepts full responsibility therefor. 2 (Emphasis added.) CSAA included the following indemnification provision wherein Hamilton agreed to indemnify CSAA against any liens "including medical services" necessitated from the accident: The Releasor [Hamilton] hereby agrees to defend, indemnify and hold harmless the Releasee [the alleged tortfeasors] and his/her/its Insurer(s) [CSAA], against any claims, liens, demands, actions and causes of action asserted by any person, corporation, insurer, governmental entity or other entity seeking reimbursement of funds incurred or paid to or on behalf of the Releasor for any purpose, which payments (including medical services) were necessitated or allegedly caused as a result of the accident or incident described above, that now exist, or may hereafter accrue against the Releasee.3 (Emphasis added). CSAA also stated that Hamilton was responsible for distributing "all funds received as may be necessary to satisfy all past, present, or future medical expenses."4 ¶4 Medical Providers sued CSAA to enforce their medical liens after CSAA paid settlement monies to Hamilton without honoring their liens. The remaining balances due under the liens exceeded the $7,500 paid to Hamilton; but Medical Providers limited the relief requested to the amount paid to Hamilton. In addition, they sued to recover damages for tortious interference with contractual relations and punitive damages. Medical Providers filed a motion for partial summary judgment seeking damages protected by their liens, the amount paid to Hamilton for Seven Thousand Five Hundred Dollars ($7,500). The following are the material facts: 1. Accident Care and Treatment Center (ACTC) filed a notarized lien in the amount of $3,0192 for medical services. AAA Claim #:1002-63-3017 and mailing address were listed on the lien which was filed with the Oklahoma County Clerk. 2. Southwest Regional Imaging and Radiology, LLC, Stanley Dombek, M.D. (SWRI) filed a notarized lien in the amount of $8,333.50 for medical services. AAA Claim #:1002-63-3017 and mailing address were listed on the lien which was filed with the Oklahoma County Clerk. 3. Injury Recovery Physical Therapy, LLC, (IRPT) filed a notarized lien in the amount of $2,694.49 for medical services. AAA Claim #:1002-63-3017 and mailing address were listed on the lien which was filed with the Oklahoma County Clerk. 4. Interventional Radiology Associates, LLC (IRA) filed a notarized lien in the amount of $19,491.94 for medical services. AAA Claim #:1002-63-3017 and mailing address were listed on the lien which was filed with the Oklahoma County Clerk. 5. On December 18, 2018, CSAA settled with Hamilton and paid her $7,500.00 without including Plaintiffs' names on the check. 6. CSAA issued checks payable to Medical Providers in amounts less than their filed liens. The current balance due under each lien is $646.68 for ACTC, $2,308 for SWRI, $830 for IRPT, and $4,696.06 for IRA. Medical Providers sought only the amount paid to Hamilton, $7,500.00, which is less than the remaining lien balances. The two additional claims for tortious interference with contract and punitive damages were later dismissed without prejudice. 5 The only remaining claims to be adjudicated are the enforcement of the medical liens, the subject of the summary judgment motion before us. ¶5 CSAA did not dispute any material fact which Medical Providers listed in their summary judgment motion. CSAA's response to each of the material facts listed by Medical Providers was: "undisputed." ¶6 CSAA next asserted there were the following two additional material facts which were disputed requiring the denial of summary relief. CSAA unequivocally stated the following: 1. In the settlement between Defendant and the claimant, Defendant received an assignment from the claimant, granting Defendant an option to resolve her medical bills itself in any of several ways. 2. Defendant chose to exercise that option by challenging the correctness and validity of the debt underlying the Plaintiff's claimed lien. 6 The Court notes the record before us does not support either of these statements. ¶ 7 CSAA stated that "Gayla Hamilton agreed that Plaintiff's medical bills were unreasonably high and gave CSAA permission to issue payment to Plaintiffs at a reduced amount."7 CSAA concluded that "this conduct constitutes evidence of an implied assignment from Gayla Hamilton to CSAA to negotiate to resolve her medical bills and/or challenge the liens filed by Plaintiffs."8 CSAA cites to no legal authority to support this unique concept of an "implied assignment." There is no evidence in the record to support the statement that Hamilton agreed the medical bills were "unreasonably high;" moreover, it is irrelevant. We do note that Hamilton did execute the release which acknowledges payment to Medical Providers in amounts less than their liens. ¶8 CSAA goes on to urge that (1) the claims adjuster notes and (2) the letter from CSAA to Hamilton transmitting the release create a "question of fact" supporting the denial of summary judgment. There is no support in the record through these documents or otherwise to support there was any discussion about an assignment. The letter is a basic transmittal letter instructing Hamilton how to properly execute the release. The most notable discussion in the adjustor notes is CSAA clearly acknowledging the liens, the intention to issue settlement checks without paying the liens in full, and CSAA's adjustor advising Hamilton "that the providers she used typically inflate their billing, and we would only be responsible for the usual, reasonable, and customary charges;"9 CSAA argued that under the guidance of the Court of Civil Appeals in a prior similar action with Medical Providers, that CSAA would have the authority to dispute the amount claimed in the liens "if [the claimant] assigned to CSAA his right to challenge the amount due." Accident Care and Treatment Center v. CSAA General Insurance Co., (Accident Care I), 2021 OK CIV APP 3, ¶ 37, 483 P.3d 1,11. There is no evidence in the record of an assignment. ¶9 In reply, Medical Providers agreed that if CSAA had such an assignment, it would have the legal standing to challenge the liens. Medical Providers argued that there was no such assignment in the executed release and CSAA offered no evidence to support such an argument. We agree. This Court has announced that "an assignment is the expressed intent of one party to pass rights owned to another." Randall v. Travelers Casualty and Surety Co., 2006 OK 65, ¶ 22, 145 P.3d 1048, 1054). (emphasis added). Medical Providers also argued that if Hamilton had given an assignment to CSAA, there would be nothing for her to agree to with respect to the payment amounts to the Medical Providers. They also note that "nothing within any of Defendant's exhibits passes a right from the patient to Defendant."10 ¶10 The trial court after reviewing the Medical Providers' motion, Defendant's response and Medical Providers' reply thereto, and hearing arguments from the parties, sustained Medical Providers' motion for partial summary judgment. The trial court entered the following Journal Entry: FINDS, ORDERS, ADJUDGES and DECREES as follows: 1. Plaintiff's Motion to Amend Liens is sustained. 2. There is no evidence of an assignment by the claimant, Gayla Hamilton, to Defendant because the text of the release contract between Hamilton and Defendant did not contain such an assignment, and under the Parol Evidence Rule evidence outside the four corners of the contract may not be considered to vary the substantive terms of the release. Therefore, because CSAA's right to challenge the Plaintiff's liens only exists if the right was assigned to Defendant by the Claimant (Hamilton), Plaintiff's Motion for Partial Summary Judgment is sustained. ¶11 The Defendant, CSAA filed a Petition in Error raising two issues: (1) whether evidence of an implied assignment by one party to another may be found outside the four corners of a Release Contract entered into by those same two parties; and (2) whether the trial court erred in applying the parol evidence rule to preclude evidence that an assignment occurred between those parties which was not memorialized in the Release Agreement between the parties. ¶12 Medical Providers responded that CSAA intentionally violated the provisions of the medical lien statute, 42 O.S.2011, § 46(B), when it had knowledge of the liens and settled Hamilton's claim and issued checks to Medical Providers in amounts less than their liens. They also argued that the trial court was correct in holding that extrinsic parol evidence outside the terms of the written release could not be considered to alter the executed contract. ¶13 The Court of Civil Appeals reversed the decision of the trial court and remanded for further proceedings determining that the trial court erred when it failed to make a finding whether there was a question of material fact present in the summary judgment record regarding any claimed separate, oral agreement between Hamilton and CSAA assigning her rights to challenge Plaintiff's lien amounts.11 ¶14 Medical Providers filed a Petition for Certiorari noting that the Court of Civil Appeals relied on its prior opinion, Accident Care I, which was not reviewed by this Court, and further expanded its holding in the instant matter. The effect of CSAA's settlement tactics has been to usurp the medical lien process in violation of Section 46. They urge that the Court of Civil Appeals in its decision has created a mechanism for insurance companies to sidestep the Oklahoma medical lien process. The case before us was one of seven cases that were pending in Oklahoma County District Court between the same parties on this identical issue. Medical Providers note that under the current decision of the Court of Civil Appeals insurers can assert that any communication -- even those prior to a written settlement contract -- implicitly convey an assigned right to dispute medical lien amounts. The concern is that accident victims will no longer receive quick treatments, as medical providers like the parties herein will have no guarantee of payment unless there is pre-approval by the tortfeasor's insurer. Medical Providers also urge that the Court of Civil Appeals decided a question of substance in a way not in accord with applicable decisions of this Court. Specifically, the decision violates precedents on contract law: (1) the execution of a contract in writing supersedes all prior oral negotiations concerning its matter, Pitco Prod. Co. v. Chaparral Energy, Inc., 2003 OK 5, ¶ 14, 63 P.3d 541, 546; and (2) all prior communications are assumed to be part of the written agreement, Ollie v. Rainbolt, 1983 OK 79, ¶12, 669 P.2d 275, 279 (citing 15 O.S. § 137). ¶15 CSAA answered that under Accident Care I, the Court of Civil Appeals "in reversing and remanding, reasoned and held in pertinent parts:"12 gave CSAA the right to challenge the correctness of the debt because of the extrinsic evidence showing communications between Hamilton and CSAA and also simply by the act of Hamilton signing the release she assigned to CSAA her right to contest the amount owed under the liens.13 The Court of Civil Appeals did not so hold. While this language does appear in Accident Care I, this was not a holding as asserted by CSAA, rather the Court of Civil Appeals was simply stating CSAA's argument on appeal.14 CSAA offered no legal authority for this novel idea of an implied assignment through execution of a settlement contract in Accident Care I, nor in the instant matter. CSAA urged for an extension of Accident Care I that "the alleged assignment does not have to be clearly written in the release in order to be valid." CSAA also argued that the Court of Civil Appeals' decision is not incongruent with any applicable decisions of this Court and that it did not depart from the usual course of judicial proceedings negating this Court's powers of supervision. ¶16 On February 6. 2023 we granted Medical Providers' Writ of Certiorari. STANDARD OF REVIEW ¶17 Summary judgment settles only questions of law; we review de novo the grant of summary judgment. Am. Biomedical Grp. v. Techtrol, Inc., 2016 OK 55, ¶ 2, 374 P.3d 820, 822. Following this standard, we confine our review to the limited, undisputed, material facts. Video Gaming Technologies, Inc. v. Rogers Co. Bd of Tax Roll Corrections, 2019 OK 83, ¶ 2, 475 P.3d 824, 825. ANALYSIS ¶18 A written contract excludes prior oral negotiations and stipulations as reflected by statute: The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the oral negotiations or stipulations concerning its matter, which preceded or accompanied the execution of the instrument. 15 O.S.2011, § 137. A settlement release which is in writing "supersedes all oral stipulations or negotiations which preceded its execution." Beck v. Reynolds, 1995 OK 83, ¶ 8, 903 P.2d 317, 319. Oral evidence was not permitted in Beck to establish a previous contradictory oral agreement. ¶19 Contract terms are construed most strongly against the drafter of the contract. McMinn v. City of Oklahoma City, 1997 OK 154, ¶¶ 13-15, 952 P.2d 517, 522. This issue most often arises between the two parties to the contract where one party is asserting that the contract is susceptible of differing constructions. We noted in McMinn, that City, the drafter of the contract, was the one who chose the terms to be used in the contract and chose a broader term. City then urged a more narrow meaning was intended but we noted it would be "unfair and illogical to interpret the contract in its most narrow sense" to limit the benefits to the opposing party while providing additional benefits to persons employed by the City. ¶20 In the matter before us, the Release prepared solely at the hands of CSAA, a document that was between CSAA and a stranger to this litigation, the claimant, CSAA had sole control over the drafting of its Release. CSAA irrefutably had knowledge and notice of the Medical Providers' liens, was aware that Medical Providers could in the future sue to collect for additional funds owed, and sue the claimant, Hamilton. With this knowledge, CSAA carefully included an indemnification agreement between it and Hamilton, that Hamilton was contractually bound to indemnify CSAA in the event that Medical Providers should sue CSAA to collect additional amounts owed from medical services rendered to Hamilton. CSAA clearly envisioned the possibility of Medical Providers suing, with full knowledge it was settling this claim with Hamilton and paying her without notice to Medical Providers and without satisfying the filed medical liens. However, CSAA did not include any provision for an assignment in the Release. We hold that the Release prepared by CSAA and executed by Hamilton was clear and not ambiguous. We find that there was no assignment by Hamilton to CSAA. Even if we found an ambiguity, the release would be interpreted most strictly against the drafter, CSAA. ¶21 We also note that CSAA specifically drafted the following in the settlement agreement that "no promise or inducement has been offered except as herein set forth, that this release is executed without reliance upon any statement or representation by the person or parties released or their representatives [CSAA]."15 CSAA's assertion there was a separate agreement of an assignment between it and Hamilton, contradicts this provision of the executed settlement release. There is nothing in the record to support any suggestion of a discussion regarding an assignment between the parties. Even if there was, the introduction of parol evidence to so establish this would be barred in this instance as it would contradict the terms of the executed written settlement contract, that there were no other promises relied on by the parties or their representatives. Beck, supra; Ollie v. Rainbolt, 1983 OK 79, ¶ 12, 669 P.2d 275, 279 (Parol evidence cannot vary, modify or contradict the terms of the instrument). A contract that is complete, when viewed in its entirety is unambiguous, and the written words of the document are the only legitimate evidence of the parties' intention. Id. ¶22 Medical Providers prepared and filed liens to protect their right to be paid for the medical services they provided to Hamilton which arose from a car accident due to the alleged negligence of CSAA's insureds. CSAA admitted that Medical Providers had each filed their respective liens and in the amount reflected for their medical services. Medical Providers had a statutory lien upon any monies payable by the insurer to the injured person. Our Legislature provided for this statutory protection as follows: Physician's lien A. Every physician who performs medical services or any other professional person who engages in the healing arts, within their scope of practice pursuant to Title 59 of the Oklahoma Statutes for any person injured as a result of the negligence or act of another, shall, if the injured person asserts or maintains a claim against such other person for damages on account of such injuries, have a lien for the amount due for such medical or healing arts services upon that part going to or belonging to the injured person of any recovery or sum had or collected or to be collected by the injured person, or by the heirs, personal representative, or next of kin of the injured person in the event of his death, whether by judgment, settlement, or compromise. Such lien shall be inferior to any lien or claim of any attorney handling the claim for or on behalf of the injured person. The lien shall not be applied or considered valid against any claim for amounts due pursuant to the provisions of Title 85A of the Oklahoma Statutes.B. In addition to the lien provided for in subsection A of this section, every physician or professional person licensed under Title 59 of the Oklahoma Statutes who performs medical or healing arts within their scope of practice for any person injured as a result of the negligence or act of another, shall have, if the injured person asserts or maintains a claim against an insurer, a lien for the amount due for such medical or healing arts services upon any monies payable by the insurer to the injured person. 42 O.S.2011, § 46. (emphasis added). This section also states that before the lien will become effective the physician or other medical provider must send written notice among other requirements. Section 46 goes on to provide that the liens provided for "may be enforced by civil action in the district court of the county where the lien was filed." Section 46 (D). This action must be brought within one year after the physician or professional person becomes aware of final judgment, settlement or compromise of the claim. There is no dispute that Medical Providers complied with the terms of these provisions with respect to the filing of their liens, notice of the liens, and timely filing their action after Hamilton settled her claim with CSAA. ¶23 We have recognized that "the legislative intent of § 46 was to encourage physicians to provide medical services to persons who have been injured by another and have insufficient funds or insurance to pay for the services when delivered." Balfour v. Nelson, 1994 OK 149, ¶ 11, 890 P.2d 916, 919. Section 46 was also "designed to insure that physicians are paid for their services once their patients are compensated for their injuries." Id. CSAA has expressed concern regarding the reasonableness of Medical Providers' charges and attempted to use this concern as a way to thwart the protected interests of those who rendered medical care to Hamilton. Absent an assignment from the claimant, Hamilton, CSAA has no legal standing to raise this argument as a defense to the claims. ¶24 We hold as a matter of law, there are no disputed material facts at issue in the matter before us. The release prepared by CSAA and executed by Hamilton is clear and unambiguous and has no language supporting an assignment from Hamilton to CSAA to argue the reasonableness of the liens filed by Medical Providers. We further find there was no evidence in the record to support a suggestion of an assignment between the parties within the extrinsic evidence submitted by CSAA. Furthermore, a written release in settlement of a claim absent fraud, supersedes all oral stipulations or negotiations which precede its execution, and parol evidence is not admissible to show previous contradictory oral agreements. In the release before us, CSAA specifically included a provision that "no other promise or inducement has been offered except as herein set forth." CSAA as the drafter is barred from introducing any parol evidence in an attempt to render this provision without meaning. ¶25 The decision of the Court of Civil Appeals is vacated. The decision of the trial court is affirmed. This matter is remanded to the trial court for proceedings consistent with this Opinion. COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF TRIAL COURT AFFIRMED; MATTER REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION Rowe, V.C.J., Kauger, Winchester, Edmondson, Combs, Gurich, Darby, Kuehn, JJ., Concur. Kane, C.J., Recused. FOOTNOTES 1 Accident Care and Treatment Center, Inc., Southwest Regional Imaging and Radiology, L.L.C., Injury Recovery Physical Therapy, L.L.C., and Interventional Radiology Associates, L.L.C., Plaintiffs, (Medical Providers). 2 ROA, Doc. #3, Plfs. Mot. Partial S.J., Ex. 6. 3 Id. 4 Id. 5 Def./Aplt. Resp. to Show Cause, #119644, July 6, 2021. 6 ROA, Doc. #4, Def. Resp. to Plf. Mot. S.J. 7 Id. 8 Id. 9 Id., Ex. 1. There is nothing in the Record to support the statement: "Gayla agreed that Plaintiff's medical bills were unreasonably high..." 10 ROA, Doc. #6, Reply to Mot. S.J. 11 Opinion, Court of Civil App., Div. IV, Case No. 119,644, May 16, 2022. 12 Def./Applt. Answer in Oppos. to Appellees' Pet. for Writ of Cert., filed June 21, 2022. 13 Id. 14 Id. 15 ROA, Doc. #3, Plfs. Mot. Partial S.J., Ex. 6.

a3f21863-bcd1-42ce-a335-dd1be8b3da0d

Oklahoma Annual Conference of the United Methodist Church v. Timmons

oklahoma

Oklahoma Supreme Court

OKLAHOMA ANNUAL CONFERENCE OF THE UNITED METHODIST CHURCH v. TIMMONS2023 OK 101Case Number: 121483Decided: 10/24/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. THE OKLAHOMA ANNUAL CONFERENCE OF THE UNITED METHODIST CHURCH, INC., a domestic not-for-profit corporation, THE BOARD OF TRUSTEES OF THE OKLAHOMA ANNUAL CONFERENCE OF THE UNITED METHODIST CHURCH, INC., a domestic not-for-profit corporation, JIMMY NUNN, Bishop of the Oklahoma Annual Conference, VICTOR MCCULLOUGH, District Superintendent of the Heartland District of the Oklahoma Annual Conference, Petitioners, v. THE HONORABLE Aletia H. Timmons, Judge of the District Court of Oklahoma County, Respondent, and THE FIRST UNITED METHODIST CHURCH OF OKLAHOMA CITY, an incorporated religious association acting by and through its duly Elected Trustee, Real Party in Interest. ¶0 The Oklahoma Annual Conference of the United Methodist Church applied for writs of mandamus and prohibition against Respondent, after a grant of mandatory injunctive relief. This Court previously granted writs of mandamus and prohibition by Order on October 5, 2023. We hold the doctrine of church autonomy applies and remand with instructions to dismiss. WRITS OF MANDAMUS AND PROHIBITION PREVIOUSLY GRANTED; CASE REMANDED TO THE DISTRICT COURT OF OKLAHOMA COUNTY WITH INSTRUCTIONS TO DISMISS Ross A. Plourde, Kate N. Dodoo, Peyton S. Howell, McAfee & Taft, Oklahoma City, Oklahoma, for Petitioners Cheryl Plaxico, Plaxico Law Firm, P.L.L.C., Cara S. Nicklas, Ashley Ray, McAlister, McAlister & Nicklas, P.L.L.C., Oklahoma City, Oklahoma, for Real Party in Interest KUEHN, J.: ¶1 The First United Methodist Church of Oklahoma City (First Church) is affiliated with the Oklahoma Annual Conference of the United Methodist Church (UMC). First Church wished to undergo the process of disaffiliation from UMC while retaining its real property, as provided in Paragraph 2553 of the United Methodist Book of Discipline. First Church ultimately sued UMC in pursuit of this goal, and Respondent granted it injunctive relief. We conclude that this remedy violates the doctrine of church autonomy, and Respondent lacked subject matter jurisdiction to hear the case. For this reason, we granted the writs of mandamus and prohibition by Order on October 5, 2023. Facts and Procedural History The UMC Disaffiliation Process ¶2 The General Conference is the United Methodist Church's (UMC) principal governing body. The General Conference enacts the Book of Discipline, UMC's governing document. The Book of Discipline includes both matters of doctrine and policy, and procedures for implementing them. Each church joining UMC agrees to abide by the requirements and provisions of the Book of Discipline. Individual churches have no ability to change those provisions. UMC has subordinate organizational levels. These include regional districts. The Oklahoma Annual Conference consists of clergy serving within Oklahoma along with an equal number of lay members elected by local churches. The General Conference also has a Judicial Council which decides disputes and controversies concerning doctrine and Book of Discipline provisions. ¶3 The general rule according to UMC's Book of Discipline is that a church may disaffiliate, but UMC retains the associated church property. In 2019 UMC enacted Paragraph 2553 of the Book of Discipline, an exception to that general rule. It provides an opportunity for congregations who disagree with UMC's doctrine related to the practice of homosexuality or the ordination or marriage of homosexuals, as provided in the Book of Discipline, to disaffiliate and keep their property. The process begins with notice to the UMC and an initial vote by the congregation (called a church conference), conducted according to Book of Discipline provisions, in which two thirds of the congregation must vote to disaffiliate. As allowed by the terms of Paragraph 2553, the Oklahoma Annual Conference Board of Trustees provided that a congregation may take a church conference vote only once in a one-year period; however, the district superintendent has discretion to call a second church conference vote within the year. After the church conference vote, a disaffiliation agreement along with specific materials must be compiled and presented to support formal approval of disaffiliation by the Oklahoma Annual Conference. To facilitate this requirement the Oklahoma Bishop scheduled Annual Conference meetings in October 2022, April 2023, and October 2023. To accommodate the time necessary to prepare the agreement and materials, the Annual Conference required any church wishing to be considered for disaffiliation at the October 2023 meeting to hold its church conference vote by September 6, 2023. Finally, any congregation wishing to disaffiliate by the means of Paragraph 2553 must complete the entire process before December 31, 2023. First Church Request to Disaffiliate ¶4 In late 2022, First Church told UMC it wanted to begin the disaffiliation process under Paragraph 2553. UMC scheduled the First Church conference vote on disaffiliation for January 23, 2023. Subsequently UMC received information which caused it to question whether First Church was a viable institution. On January 17, UMC postponed the January 23 vote until it conducted a viability study (CCV), as provided for in the Book of Discipline. The CCV process was delayed. On February 2, First Church held an informal church conference vote to disaffiliate. On May 5, First Church asked UMC to cancel the CCV. On May 16, First Church sent UMC a demand letter, asking for a response by May 19 and for UMC to schedule a formal church conference vote. UMC did not respond. First Church District Court Litigation ¶5 On June 1, while completion of the viability study remained pending, First Church sued UMC in Oklahoma County District Court for injunctive relief, declaratory judgment, and damages. That same day Respondent issued a temporary restraining order prohibiting continuation of the CCV process and preserving the status quo as to the church property. On June 16 UMC filed a motion to dismiss for lack of subject matter jurisdiction. This was denied after a hearing on July 7, as was UMC's immediate motion to stay that decision pending appeal. Immediately after concluding the hearing on the motion to dismiss, Respondent began the hearing on First Church's request for an injunction on July 7, and this second hearing continued on July 14 and 17. On July 25, Respondent granted a temporary mandatory injunction, ordering: (1) First Church was not required to complete the CCV process imposed by UMC; (2) UMC must recognize First Church's February 5 internal church conference vote to disaffiliate; (3) UMC must call a special Annual Conference on or before August 6, 2023, to vote on whether to approve First Church's disaffiliation agreement with the UMC Board of Trustees, and the delegates to that conference shall be the same membership as the delegates who voted on disaffiliation agreements at the April 22, 2023 special Annual Conference; and 4) the temporary restraining order of June 1 remained in effect. ¶6 UMC did not appeal this ruling, although it could have done so as an interlocutory order appealable by right under Supreme Court Rule 1.60(c) and Title 12, Sections 952(b)(2) and 993(A)(2). Instead, on July 26, UMC filed this application for a writ, asking this Court to prohibit the District Court from enforcing its July 25 Order, and to order the court to dismiss First Church's suit for lack of subject matter jurisdiction. On August 2 this Court stayed the injunction pending resolution of this writ. Due to the stay, UMC did not hold the court ordered Annual Conference. ¶7 First Church has suggested that UMC's filing in this Court was untimely under Rule 1.191(i), Oklahoma Supreme Court Rules, 12 O.S. ch. 15, App. 1. However, that Rule does not apply. Rule 1.191(i) requires a party seeking a stay of a proceeding to file its application at least ten days before the proceeding it wants to stay is set in the district court. The rule applies where the petitioner wants to prevent a district court from conducting a hearing; it is filed before the proceeding happens. But here, UMC asked this Court to stay an order Respondent had already issued, and to prevent Respondent from enforcing its order. That is, UMC wanted to stop enforcement of a ruling that had already happened -- and filed that request within ten days of the hearing. UMC's request was not untimely. Standard of Review ¶8 Petitioner seeks a writ of mandamus and/or prohibition. For a writ of mandamus, Petitioner must show (1) it has a clear legal right to the relief sought; (2) Respondent has a plain legal duty regarding the relief; (3) Respondent has refused to perform the duty; (4) the duty does not involve an exercise of discretion; and (5) Petitioner has no plain and adequate remedy in the ordinary course of the law. Nichols v. Ziriax, 2022 OK 76, ¶ 11, 518 P.3d 883, 887. For a writ of prohibition, a petitioner must show (1) an exercise of judicial or quasi-judicial power; (2) which is unauthorized by law; (3) and which will result in injury for which there is no other adequate remedy. Maree v. Neuwirth, 2016 OK 62, ¶ 6, 374 P.3d 750, 752. Petitioners have shown both a clear legal right to the relief sought, that Respondent refused to perform its duty, and an exercise of unauthorized judicial power, and have no remedy other than an extraordinary writ. Church Autonomy Doctrine Applies ¶9 The United States Supreme Court established long ago that church authority governs internal ecclesiastical disputes, to avoid the courts becoming entangled in religious doctrine. Watson v. Jones, 80 U.S. 679, 727 (1871). Under the church autonomy doctrine, also known as the ecclesiastical abstention doctrine, courts have no subject matter jurisdiction over matters of "theological controversy, church discipline, [or] ecclesiastical government...." Serbian E. Orthodox Diocese v. Milivojevich, 426 U.S. 696, 714 (1976). Where ecclesiastical decisions are at issue, constitutional due process and "secular notions of 'fundamental fairness' or impermissible objectives" are irrelevant. Id. at 714-15. This affords churches the freedom to decide their own government, faith and doctrine. Kedroff v. St. Nicholas Cathedral of Russian Orthodox Church in North America, 344 U.S. 94, 116 (1952). This is considerably broader than questions of who may preach, the content of sermons, or how services are conducted. "Government action that interferes with this autonomy or risks judicial entanglement with a church's conclusions regarding its own rules, customs, or laws is therefore prohibited by the First Amendment." In re Lubbock, 624 S.W.3d 506, 513 (Tex.), cert. denied sub nom. Guerrero v. Diocese of Lubbock, 142 S. Ct. 434 (2021). Church autonomy protects and gives force to the First Amendment freedom of religion clause. ¶10 Where a dispute involves only narrow property issues, without any reference to religious doctrine and practice, courts may apply neutral principles of law to review language of deeds, terms of charters, church provisions concerning property ownership, and state property and trust statutes. Jones v. Wolf, 443 U.S. 595, 602-03 (1979). However, a court may not, under the neutral principles approach, decide for itself what any governing church provisions mean; the review must be strictly secular, and courts must defer to the church leadership's resolution of any religious or doctrinal question. Id. at 604; Lubbock, 624 S.W.3d at 513. Church autonomy will apply, and a case must be dismissed, where potentially secular issues are inextricably intertwined with ecclesiastical decisions. Lubbock, 624 S.W.3d at 514. ¶11 This Court has applied the church autonomy doctrine where the issues involved ecclesiastical decisions or doctrine and the plaintiffs were subject to church authority. See, e.g., Fowler v. Bailey, 1992 OK 160, ¶ 7, 844 P.2d 141, 144 (court cannot reinstate former church members after expulsion, which is within church purview; as plaintiffs were expelled from church, they had no standing in church property dispute); Hadnot v. Shaw, 1992 OK 21, ¶¶ 28-29, 826 P.2d 978, 987 (discipline during expulsion process was within church's ecclesiastical authority); Guinn v. Church of Christ, 1989 OK 8, ¶ 23, 775 P.2d 766, 775 (church autonomy applied to church's disciplinary acts against plaintiff until she resigned her membership). In Doe v. First Presbyterian Church U.S.A. of Tulsa, we ultimately found that the church autonomy doctrine did not bar the plaintiff's suit because the plaintiff had not subjected himself to church authority. Doe, 2017 OK 106, ¶ 23, 421 P.3d 284, 290. We refused a request to require a religious denomination to provide marital counseling or face civil damages, as decisions of what ministerial services to provide are ecclesiastical. Bladen v. First Presbyterian Church of Sallisaw, 1993 OK 105, ¶ 28, 857 P.2d 789, 797. ¶12 At issue here is whether deciding the merits of the claims of First Church requires the courts to interpret the Book of Discipline and Paragraph 2553. As the Book of Discipline is a governing church document, its interpretation is an ecclesiastical issue. All parties agree that the Book of Discipline is UMC's governing document. They also agree that Paragraph 2553 was specially adopted to address a specific ecclesiastical matter. First Church frames its lawsuit as a property issue; however, it chose to disaffiliate under the rules of church doctrine outlined in Paragraph 2553 to claim the property. First Church does not have a property dispute at this juncture, and it cannot claim to have a dispute at this juncture without confronting the doctrinal issue explicitly raised by the church-created procedural language. First Church also claims the UMC has violated its own procedures outlined in the Book of Discipline. But the only way for the courts to decide that question is, again, to interpret those internal church procedures. Under the church autonomy doctrine, courts cannot -- and should not -- do that. ¶13 Here, Respondent did that. Respondent rejected UMC's explanation of the Book of Discipline and its governing document with its own interpretation to achieve a "fair" result. This is not the role of the courts where ecclesiastical doctrine is involved. Milivojevich, 426 U.S. at 714. And Respondent's rulings clearly show that it concluded that First Church's claims based on the process of Paragraph 2553 disaffiliation cannot be decided without interpreting the Book of Discipline. First Church's claims are thus inextricably intertwined with church doctrine, and church autonomy applies. The Church Autonomy Doctrine Bars Subject Matter Jurisdiction ¶14 This is a subject matter jurisdiction issue. Before 2017, the United States Supreme Court, this Court, and other jurisdictions treated church autonomy as defeating subject matter jurisdiction. When church autonomy applied, the courts could not hear a case at all. In Doe this Court, on rehearing, determined that church autonomy was an affirmative defense rather than a question of subject matter jurisdiction. Doe, 2017 OK 106, ¶ 24, 421 P.3d at 291. In doing so we relied on a United States Supreme Court case, Hosanna-Tabor Evangelical Lutheran Church & Sch. v. E.E.O.C., 565 U.S. 171 (2012), which concerned the ministerial exception to federal statutory employment law. In a footnote, Hosanna-Tabor had concluded that the ministerial exception "operates as an affirmative defense to an otherwise cognizable claim", in the context of employment suits. Id. at 195 n.4. Hosanna-Tabor did not discuss the church autonomy doctrine. ¶15 The Doe majority treated the ministerial exception and the church autonomy doctrine as the same concept. However, they differ significantly in scope and purpose, and should be treated differently. The church autonomy doctrine is much older than the ministerial exception. Watson recognized the church autonomy doctrine as a matter not within civil courts' jurisdiction in 1871. Watson, 80 U.S. at 733. By contrast, Hosanna--Tabor noted that the ministerial exception has been recognized since Title VII employment discrimination laws were passed in 1964. Hosanna-Tabor, 565 U.S. at 188 (citing federal Courts of Appeals cases from the 1980s onwards). The ministerial exception prevents courts from hearing employment challenges to church decisions hiring and firing ministers; any State attempt to interfere with a church's internal governance by imposing an unwanted minister or deciding who should minister to a particular church's congregation violates both the Free Exercise Clause and the Establishment Clause. Id. at 189. The exception is narrowly tailored to federal statutory employment claims. By contrast, the church autonomy doctrine is much broader, and bars courts from exercising subject matter jurisdiction over disputes involving faith, church discipline, and church government. Watson, 80 U.S. at 729. Watson explained that this protects "that full, entire, and practical freedom for all forms of religious belief and practice which lies at the foundation of our political principles." Id. at 728. And in a recent case, the United States Supreme Court described its recognition of the ministerial exception in Hosanna-Tabor as arising out of the broad principles outlined in Watson, Kedroff, and Milivojevich. Our Lady of Guadalupe School v. Morrissey-Berru, 140 S. Ct. 2049, 2061 (2020). ¶16 After consideration, we conclude that the Doe majority inadvertently conflated the church autonomy doctrine and the ministerial exception. Doe, 2017 OK 106 at ¶ 6, 421 P.3d at 292-93 (Combs, C.J. dissenting). As Justice Combs explained in dissent, "[T]he Hosanna--Tabor Court did not extend its determination on subject matter jurisdiction beyond the ministerial exception to the broader church autonomy doctrine." Doe, 2017 OK 106 at ¶ 7, 421 P.3d at 293 (Combs, C.J. dissenting). This Court's previous cases (including those discussed above, except Doe) all treat church autonomy as barring subject matter jurisdiction. See Doe, 2017 OK 106 at ¶ 5, 421 P.3d at 292 (Combs, C.J. dissenting).1 ¶17 But Doe's ultimate result -- that church autonomy did not apply and the case could proceed below -- does not turn on its misapplication of Hosanna-Tabor. The key to Doe is its oft-repeated conclusion that Doe himself never joined the First Presbyterian Church of Tulsa (as all parties agreed), and that consequently he did not subject himself to its ecclesiastical jurisdiction. That conclusion, under the facts presented, was unremarkable according to this Court's and the United States Supreme Court's existing law. Whether the doctrine is an affirmative defense or bars subject matter jurisdiction wasn't relevant to our controlling conclusion. ¶18 Consequently, we take this opportunity to clarify the procedural posture of the church autonomy doctrine. We return to our settled jurisprudence and reaffirm that church autonomy is a bar to subject matter jurisdiction. To this end we overrule the narrow ruling in Doe at paragraphs 24, 25 and 26, which found that church autonomy is an affirmative defense. Doe, 2017 OK 106, ¶¶ 24-26, 421 P.3d at 290-91. The remainder of the Doe opinion, including its holding reversing the district court's judgment and remanding the case, is unchanged. Conclusion ¶19 For a writ of prohibition, UMC must show that Respondent has exercised judicial power unauthorized by law, and that exercise has resulted in injury for which there is no other adequate remedy. Maree, 2016 OK 62, ¶ 6, 374 P.3d at 752. For a writ of mandamus, UMC must show it has a clear legal right to the relief sought, Respondent refuses to perform a plain legal duty not involving an exercise of discretion regarding the relief, and UMC has no adequate remedy. Nichols, 2022 OK 76, ¶ 11, 518 P.3d at 887. A mandatory injunction, rather than preserving the status quo, "is an extraordinary remedial process that commands the performance of some positive act." Owens v. Zumwalt, 2022 OK 14, ¶ 7, 503 P.3d 1211, 1214. ¶20 In ordering the temporary mandatory injunction at First Church's request, Respondent found that First Church was likely to succeed on the merits and would be irreparably harmed if the injunction were denied, that the harm First Church would incur outweighed any injury to UMC under the injunction, and that the injunction was in the public interest. Owens, 2022 OK 14, ¶ 8, 503 P.3d at 1214; Dowell v. Pletcher, 2013 OK 50, ¶ 7, 304 P.3d 457, 460. In so finding, Respondent waded into the ecclesiastical realm and fashioned a remedy that is on its face contrary to the Book of Discipline procedures. This violated church autonomy. ¶21 UMC could have appealed those decisions but chose to file writs instead. Under these circumstances this was appropriate. Respondent had no subject matter jurisdiction. Respondent should neither have held the hearings on First Church's claims, nor issued the temporary mandatory injunction. In doing so, Respondent exercised judicial power unauthorized by law. In refusing to grant UMC's motions to dismiss for lack of subject matter jurisdiction, Respondent refused to perform a plain legal duty not involving the exercise of discretion. Consequently, this Court granted the writs of mandamus and prohibition. The case is remanded with instructions to dismiss. WRITS OF MANDAMUS AND PROHIBITION PREVIOUSLY GRANTED; CASE REMANDED TO THE DISTRICT COURT OF OKLAHOMA COUNTY WITH INSTRUCTIONS TO DISMISS CONCUR: KANE, C.J., Rowe, V.C.J., Kauger, Winchester, Combs, Darby and Kuehn, JJ., Rowland, S.J. and Swinton, S.J. RECUSED: Edmondson and Gurich, JJ. Kane, C.J., with whom Kauger, J., joins, concurring. "While the Church autonomy doctrine deprived the Court of subject matter jurisdiction under these facts, Courts continue to have subject matter jurisdiction to resolve church property disputes, and they may review provisions of the Book of Discipline concerning the ownership of property provided the references do not speak to religious doctrine or practice. See Jones v. Wolf, 443 U.S. 595, 603 (1979)." FOOTNOTES 1 As Justice Combs discussed, cases from other jurisdictions, decided between 2012 and 2017, reached the same conclusion. Id. at ¶¶ 8-11, 421 P.3d at 293-94 (Combs, C.J., dissenting) (including cases from Tennessee, South Dakota, Kentucky, Florida, and the United States District Court for the District of Columbia); see also Lubbock, 624 S.W.3d at 516 (in 2021, Texas Supreme Court held that where church autonomy applies, courts lack jurisdiction).

73f783ec-8741-473c-b172-f40667d12dd2

Oklahoma Call for Reproductive Justice v. Drummond

oklahoma

Oklahoma Supreme Court

OKLAHOMA CALL FOR REPRODUCTIVE JUSTICE v. DRUMMOND2023 OK 111Case Number: 119918Decided: 11/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. OKLAHOMA CALL FOR REPRODUCTIVE JUSTICE, on behalf of itself and its members; TULSA WOMEN'S REPRODUCTIVE CLINIC, LLC, on behalf of itself, its physicians, its staff, and its patients; ALAN BRAID, M.D., on behalf of himself and his patients; COMPREHENSIVE HEALTH OF PLANNED PARENTHOOD GREAT PLAINS, INC., on behalf of itself, its physicians, its staff, and its patients; and PLANNED PARENTHOOD OF ARKANSAS & EASTERN OKLAHOMA, on behalf of itself, its physicians, its staff, and its patients, Plaintiffs/Appellants, v. GENTNER DRUMMOND, in his official capacity as Attorney General for the State of Oklahoma; VICKI BEHENNA, in her official capacity as District Attorney for Oklahoma County; STEVE KUNZWEILER, in his official capacity as District Attorney for Tulsa County; LYLE KELSEY, in his official capacity as Executive Director of the Oklahoma State Board of Medical Licensure and Supervision; BRET S. LANGERMAN, in his official capacity as President of the Oklahoma State Board of Osteopathic Examiners; KEITH REED, in his official capacity as the Commissioner of the Oklahoma State Board of Health; and JASON WILLEFORD, in his official capacity as the President of the Oklahoma State Board of Pharmacy; as well as their employees, agents, and successors, Defendants/Appellees. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY The Honorable Cindy H. Truong ¶0 The appellants filed an action to permanently enjoin enforcement of five Acts of the Oklahoma Legislature. Each Act concerns the termination of a pregnancy. The appellants' challenges are based upon Oklahoma law and not federal law. They assert there is a constitutional right to terminate a pregnancy under the Oklahoma Constitution. The trial court denied a temporary injunction on three of the Acts, which is the basis of this appeal. We retained this appeal and granted a temporary injunction pending appeal. We now vacate the trial court's order denying temporary injunction, direct it to grant a temporary injunction and remand the matter for further proceedings on the merits. VACATED AND REMANDED FOR FURTHER PROCEEDINGS; TRIAL COURT DIRECTED TO GRANT TEMPORARY INJUNCTION; THIS COURT'S TEMPORARY INJUNCTION IS LIFTED ONCE THE TRIAL COURT'S TEMPORARY INJUNCTION BECOMES EFFECTIVE J. Blake Johnson, Overman Legal Group, PLLC, Oklahoma City, Oklahoma, for Plaintiff/Appellant Tulsa Women's Reproductive Clinic, L.L.C. Kulsoom Ijaz, Rabia Muqaddam, Caroline Sacerdote, and Linda C. Goldstein, Center for Reproductive Rights, New York, New York, for Plaintiffs/Appellants Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, L.L.C., and Alan Braid, M.D. Meghan Agostinelli, Dechert LLP, Chicago, Illinois, for Plaintiffs/Appellants Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, L.L.C., and Alan Braid, M.D. Jenna Newmark, Dechert LLP, New York, New York, for Plaintiffs/Appellants Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, L.L.C., and Alan Braid, M.D. Jerome A. Hoffman, Dechert LLP, Philadelphia, Pennsylvania, for Plaintiffs/Appellants Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, L.L.C., and Alan Braid, M.D. Jonathan Tam, Dechert LLP, San Francisco, California, for Plaintiffs/Appellants Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, L.L.C., and Alan Braid, M.D. Diana O. Salgado, Planned Parenthood Federation of America, Washington, DC, for Plaintiffs/Appellants Comprehensive Health of Planned Parenthood Great Plains, Inc. and Planned Parenthood of Arkansas & Eastern Oklahoma. Mithun Mansinghani, Zach West, Office of Attorney General, State of Oklahoma, Oklahoma City, Oklahoma, for Defendants/Appellees. COMBS, J.: ¶1 This opinion addresses only the trial court's denial of a temporary injunction to enjoin the enforcement of three Oklahoma Acts: House Bill 1904, 2021 Okla. Sess. Laws ch. 211 (effective November 1, 2021); Senate Bill 778, 2021 Okla. Sess. Laws ch. 577 (effective November 1, 2021); and Senate Bill 779, 2021 Okla. Sess. Laws ch. 578 (effective November 1, 2021). On September 2, 2021, the appellants - Oklahoma Call for Reproductive Justice; Tulsa Women's Reproductive Clinic, LLC; Alan Braid, M.D.; Comprehensive Health of Planned Parenthood Great Plains, Inc.; and Planned Parenthood of Arkansas & Eastern Oklahoma (Appellants) - petitioned the trial court to find that five Oklahoma Acts relating to abortion were unconstitutional under the due process section of the Oklahoma Constitution (article II, section 7). In addition, they asserted S.B. 778 and S.B. 779 violated the single-subject rule found in article V, section 57 of the Oklahoma Constitution and the Acts were enacted for an improper purpose. The appellants did not assert any federal claims. Contemporaneous with their petition, the appellants filed a motion for a temporary injunction requesting the trial court enjoin enforcement of the Acts. The trial court held a hearing on the motion and filed its order on October 7, 2021. The court granted a temporary injunction on two of the Acts but denied a temporary injunction on H.B. 1904, S.B. 778, and S.B. 779. The appellants have appealed the denial of the temporary injunction on the three Acts. They filed a petition in error on October 13, 2021, and filed a motion for temporary injunction pending appeal in this Court. We retained the appeal and granted their motion for temporary injunction pending appeal on October 25, 2021.1 STANDARD OF REVIEW ¶2 Matters involving the grant or denial of injunctive relief are of equitable concern. Dowell v. Pletcher, 2013 OK 50, ¶5, 304 P.3d 457, 460. Injunction is an extraordinary remedy and relief by this means should not be granted lightly. Id. A temporary injunction protects a court's ability to render a meaningful decision on the merits of the controversy. Okla. Pub. Emps. Ass'n v. Okla. Military Dep't, 2014 OK 48, ¶15, 330 P.3d 497, 504. The purpose of a temporary injunction is to preserve the status quo and prevent the perpetuation of a wrong or the doing of an act whereby the rights of the moving party may be materially invaded, injured, or endangered. Id. Equity courts exercise discretionary power in granting or withholding extraordinary remedies, particularly where injunctive relief is sought, and its granting rests in the sound discretion of the court to be exercised in accordance with equitable principles and in light of all circumstances. Dowell, 2013 OK 50, ¶5, 304 P.3d at 460. The right to injunctive relief must be established by clear and convincing evidence. Id. ¶7, 304 P.3d at 460. To obtain a temporary injunction, a plaintiff must show that four factors weigh in their favor: 1) the likelihood of success on the merits; 2) irreparable harm to the party seeking the relief if the injunction is denied; 3) their threatened injury outweighs the injury the opposing party will suffer under the injunction; and 4) the injunction is in the public interest. Okla. Pub. Emps. Ass'n, 2014 OK 48, ¶9, 330 P.3d at 502-03. Granting or denying injunctive relief is within the sound discretion of the trial court and a judgment issuing or refusing to issue an injunction will not be disturbed on appeal unless the lower court has abused its discretion or the decision is clearly against the weight of the evidence. Dowell, 2013 OK 50, ¶¶5-6, 304 P.3d at 460; Sharp v. 251st Street Landfill, Inc., 1996 OK 109, ¶4, 925 P.2d 546, 549. The temporary injunction is not itself a decision on the merits. Edwards v. Bd. of Cty. Comm'rs of Canadian Cty., 2015 OK 58, ¶34, 378 P.3d 54, 64. Neither appellate affirmance nor reversal of an interlocutory injunction decree could, without more, become an adjudication on the merits of the action. Smith v. State ex. rel. Bd. of Regents of Okla. State Univ., 1993 OK 1, ¶7, 846 P.2d 370, 372. Issues resolved at this interim stage are never res judicata of the claim. Id. When they are retendered on trial of the plaintiff's quest for permanent injunction, both parties are free to offer different or additional proof. Id. ANALYSIS ¶3 The appellants assert they have demonstrated a likelihood of success on the merits concerning their arguments challenging the constitutionality of the three Acts under the Oklahoma Constitution. The constitutionality of the three challenged Acts goes to the merits of the underlying action. Our duty at this interlocutory stage is to review only the trial court's decision denying a temporary injunction and to determine whether the court abused its discretion or the decision was clearly against the weight of the evidence. ¶4 The appellants claim the three Acts violate the Oklahoma Constitution. They do not assert their arguments are based upon the federal Constitution. The appellants assert the Acts place undue burdens on a woman's right to terminate her pregnancy in violation of article II, section 7 of the Oklahoma Constitution, the state due process section. This section provides: No person shall be deprived of life, liberty, or property, without due process of law. Therefore, we must first determine whether the Oklahoma Constitution provides a right - or at least some right - to terminate a pregnancy and, if so, what is the appropriate standard for determining when a state regulation violates that right. We recently answered these questions in Oklahoma Call for Reproductive Justice v. Drummond (OCRJ I), 2023 OK 24, 526 P.3d 1123. ¶5 OCRJ I was this Court's first opinion concerning abortion rights following the United States Supreme Court's holding that there was no longer a right to terminate a pregnancy under the federal Due Process Clause. See Dobbs v. Jackson Women's Health Org., 142 S. Ct. 2228 (2022). Dobbs held that, in order for a fundamental right to be recognized as a component of the liberty protected in the Due Process Clause, such right must be deeply rooted in our Nation's history and tradition. Id. at 2246, 2260. The Court determined that was not the case when considering abortion had been outlawed in every single state prior to Roe v. Wade, 410 U.S. 113 (1973). Id. at 2248. We determined that if this Court were to adopt the Dobbs analysis we would have to find a limited right to terminate a pregnancy was deeply rooted in Oklahoma's history and tradition. OCRJ I, 2023 OK 24, ¶7. Since the days of the Oklahoma Territory and until Roe, Oklahoma outlawed abortion; however, such criminal statutes also provided a limited exception to allow an abortion if it was "necessary to preserve her life." See Okla. (Terr.) Stat. § 2187 (1890); 12 O.S. 2021 § 861. Id. We found that Dobbs did not account for such exceptions and our history and tradition had long recognized such right. Id. ¶8. This right is protected under Sections 22 and 73 of Article II of the Oklahoma Constitution. Id. Therefore, we held that the Oklahoma Constitution protects a limited right to an abortion, i.e., one that creates an inherent right of the mother to terminate a pregnancy when necessary to preserve her life. Id. ¶9. This inherent right to preserve the life of the mother was defined to mean: a woman has an inherent right to choose to terminate her pregnancy if, at any point in the pregnancy, the woman's physician has determined to a reasonable degree of medical certainty or probability that the continuation of the pregnancy will endanger the woman's life due to the pregnancy itself or due to a medical condition that the woman is either currently suffering from or likely to suffer from during the pregnancy. Absolute certainty is not required; however, mere possibility or speculation is insufficient. Id. In addition, we held the standard that should be applied when reviewing challenges to state laws affecting the inherent right to preserve the life of the mother is strict scrutiny. Id. ¶11. We made no ruling on whether the Oklahoma Constitution provides a right to an elective termination of a pregnancy. Id. ¶10. ¶6 The appellants assert the three Acts severely and intentionally restrict access to abortions and are unrelated to any purported interest in patient health. H.B. 1904 provides a new requirement that a physician who performs an abortion must be board-certified in obstetrics and gynecology. S.B. 779 requires a physician who is certified to provide an abortion-inducing drug either to have admitting privileges at a hospital in the county or contiguous to the county where the abortion-inducing drug was administered or to have a written agreement with an associated physician in such location. S.B. 778 requires an Ultrasound be performed at least 72 hours prior to providing an abortion-inducing drug, but it does make an exception if such requirement would pose a greater risk of death or impairment. Both S.B. 778 and S.B. 779 provide for criminal and civil penalties for failure to comply with any provision in the Acts. Both Acts have, among other things, stringent reporting requirements. For example, S.B. 778 requires a physician to provide a report within three days of an Adverse Event to the FDA and the state health department, and S.B. 779 has a similar requirement. Failure to comply would appear to be a crime under the Acts and would also expose the physician to potential civil action. ¶7 The appellees assert these Acts are designed to benefit women's health. The parties have provided competing affidavits concerning the safety of medication abortion. The appellants assert research consistently shows that medication abortion is safer than many other common medications, including antibiotic and over-the-counter drugs, like Advil or Tylenol.4 This Court has previously acknowledged there have been no significant health-related problems with using the current FDA protocol in medication abortion. Okla. Coal. for Reproductive Justice v. Cline, 2019 OK 33, ¶36, 441 P.3d 1145, 1158. ¶8 Under H.B. 1904, the requirement for a board certified OB/GYN to be the only authorized physician capable of performing the procedure would greatly reduce access to patients where such a specialty is not readily available or timely available once the patient's medical team has made a determination that the procedure is necessary to preserve the life of the mother. Any additional delay in access to the procedure once the necessity has been determined is clearly detrimental to the health of the patient and her constitutionally protected right to terminate the pregnancy to preserve her life. ¶9 S.B. 779 requires a physician who is certified to provide abortion-inducing drugs to have admitting privileges at a hospital in the county or contiguous county of where the abortion-inducing drug was provided. In 2016, this Court found such admitting privileges requirements were an impermissible hurdle for women seeking lawful abortion and there was no evidence to persuade this Court that such provisions advance women's health. Burns v. Cline, 2016 OK 121, ¶¶18-19, 387 P.3d 348, 353-54. Having previously determined this requirement to be an impermissible hurdle for women seeking lawful termination of a pregnancy and that there was no evidence to persuade us that such provisions advance women's health, we therefore find such restriction would likely fail under a strict scrutiny review in light of both our decision in OCRJ I and a woman's constitutional right to terminate a pregnancy to preserve her life. ¶10 S.B. 778 requires an ultrasound be conducted 72 hours prior to the day of the abortion. Mandating an ultrasound to be performed 72 hours prior to any procedure that a woman's medical team has already determined is necessary to preserve her life, would increase the risk of harm to the woman and limit her access to necessary and timely healthcare to preserve her life - necessary and timely healthcare for which she has a constitutionally protected right. ¶11 In addition, both S.B. 778 and 779 have stringent reporting requirements and penalties for any violations of the Acts, including criminal sanctions. A violation of the Acts can be the cause for a civil malpractice action for actual and punitive damages, professional disciplinary action, and attorney fee awards. S.B. 779 also requires certification before one can distribute or provide an abortion-inducing drug. The penalties for failure to receive certification equals $5,000,000 per violation for a manufacturer or distributor and $250,000 per violation for a physician. The chilling effect of these new laws is such that no physician would likely risk providing constitutionally protected care for fear of violating these statutes. ¶12 The clear weight of the evidence presented showed the apparent effect of the three Acts would place unnecessary burdens on the lawful termination of a pregnancy and therefore we hold that the trial court erred by not granting the temporary injunction. CONCLUSION Currently, we granted a temporary injunction to prevent enforcement of the Acts pending appeal. Maintaining the status quo would further the public interest of protecting a woman's right to terminate a pregnancy in order to preserve her life. The trial court denied the appellants' requested temporary injunction during the pendency of the action on the merits. We hold this was against the clear weight of the evidence. We hereby direct the trial court to enter a temporary injunction. The temporary injunction entered by this Court on October 25, 2021, shall remain in effect until the trial court's temporary injunction becomes effective. Having determined the trial court's order denying the temporary injunction was against the clear weight of the evidence, we need not rule on the appellants' other allegations of constitutional error. The matter is remanded to the trial court for further proceedings on the merits. VACATED AND REMANDED FOR FURTHER PROCEEDINGS; TRIAL COURT DIRECTED TO GRANT TEMPORARY INJUNCTION; THIS COURT'S TEMPORARY INJUNCTION IS LIFTED ONCE THE TRIAL COURT'S TEMPORARY INJUNCTION BECOMES EFFECTIVE Kauger (by separate writing), Winchester, Edmondson, Combs and Gurich, JJ., concur; Kane, C.J. (by separate writing), Rowe, V.C.J. (by separate writing), Darby (by separate writing) and Kuehn (by separate writing), JJ., dissent. FOOTNOTES 1 The names of the Attorney General of Oklahoma, District Attorney of Oklahoma County, President of the Oklahoma State Board of Osteopathic Examiners, Commissioner of the Oklahoma State Board of Health, and the President of the Oklahoma State Board of Pharmacy have been updated to reflect the current persons serving in those positions. 12 O.S. 2021, § 2025 (D). 2 Okla. Const. art. II, § 2: All persons have the inherent right to life, liberty, the pursuit of happiness, and the enjoyment of the gains of their own industry. 3 Okla. Const. art. II, § 7: No person shall be deprived of life, liberty, or property, without due process of law. 4 ROA at 218 (Aff. of Ushma Upadhyay, Ph.D., M.P.H.). KAUGER, J., concurring: ¶1 One of the dissents states: "Any analysis of an abortion statute that proceeds under the proposition that the life of the unborn is unworthy of consideration is defective." Any analysis of an abortion statute that proceeds under the proposition that the life of the mother is unworthy of consideration is defective. Kane, C.J., with whom Kuehn, J. Joins, dissenting: ¶1 The outright ban upon abortions in Oklahoma, 21 O.S. § 861, remains the law of the land in this State, notwithstanding the exceptions recently carved out by the majority in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, 526 P.3d 1123, and Oklahoma Call for Reproductive Justice v. State, 2023 OK 60, 531 P.3d 117, and now this case. Ironically, these exceptions came forth as a direct result of our review of our legislature's attempts to more fully curtail abortions in Oklahoma prior to the United States Supreme Court's ruling in Dobbs v. Jackson Women's Health Organization, 142 S. Ct. 2228, 2279 (2022). ¶2 The constitutional analysis undertaken by the majority continues to omit the weighing of the rights and interests of the unborn. Any analysis of an abortion statute that proceeds under the proposition that the life of the unborn is unworthy of consideration is defective. In a separate concurring writing, my colleague makes the identical point as to the life of the mother. I completely agree with my colleague on this. However, the interests of the mother were the only interests considered by the majority- the rights of the unborn remain unheard. ¶3 I respectfully, but most strongly continue to dissent. ROWE, V.C.J., with whom KUEHN, J., joins, dissenting: ¶1 In Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, 526 P.3d 1123, ("OCRJ I") the petitioners challenged 21 O.S. § 861, which was enacted in 1910 and prohibits elective abortion, alleging that the statute violated a woman's right to terminate a pregnancy under the Oklahoma Constitution. The Court held that the Oklahoma Constitution provides an inherent right to a pregnant woman to terminate her pregnancy when necessary to preserve her life. Id. ¶ 9, 526 P.3d at 1130. In so holding, we rejected the petitioners' constitutional challenge of § 861 because the statute contained an exception allowing a woman to obtain an abortion when necessary to preserve her life and, thus, did not infringe on the limited, Court-created right to abortion under the Oklahoma Constitution. Id. ¶ 13, 526 P.3d at 1131. Despite rejecting a constitutional challenge to § 861, which prohibits elective abortion, the majority in OCRJ I claimed to have made "no ruling on whether the Oklahoma Constitution provides a right to an elective termination of a pregnancy, i.e., one made outside of preserving the life of the pregnant woman as we have defined herein." Id. ¶ 10, 526 P.3d at 1130. Section 861 remains in effect today--its ban on elective abortion remains controlling law in Oklahoma. ¶2 Today, the majority once again claims to have "made no ruling on whether the Oklahoma Constitution provides a right to an elective termination of a pregnancy."1 This is baffling to me. In Justice Kauger's concurrence to OCRJ I, wherein she was joined by Justices Edmondson and Combs, she wrote, "I fully concur in the majority opinion which finds 21 O.S. 2021 §861 constitutional."2 Upholding a statute which criminalizes the performance of an abortion--except when necessary to save the mother's life--is completely irreconcilable with the majority's continued claim that we have not ruled on the constitutionality of elective abortion. The reality is that we answered the elective abortion question when we upheld the constitutionality of 21 O.S. § 861. The majority's refusal to acknowledge the import of OCRJ I at this point is misleading to the public and opens the door for further, fruitless litigation on a question this Court has already answered. I respectfully dissent. FOOTNOTES 1 Majority Op. at ¶ 5. 2 For reference, 21 O.S. § 861 states: Every person who administers to any woman, or who prescribes for any woman, or advises or procures any woman to take any medicine, drug or substance, or uses or employs any instrument, or other means whatever, with intent thereby to procure the miscarriage of such woman, unless the same is necessary to preserve her life shall be guilty of a felony punishable by imprisonment in the State Penitentiary for not less than two (2) years nor more than five (5) years. Darby, J., dissenting: ¶1 I respectfully dissent. The majority opinion finds that the district court abused its discretion in denying an injunction, against the clear weight of the evidence, based on state constitutional law, before this Court ever found any such constitutional right existed. See Okla. Call for Reprod. Justice v. Drummond (OCRJ I), 2023 OK 24, ¶¶ 7, 9, 526 P.3d 1123, 1129--30 (Mar. 21, 2023) (noting that this Court had not previously found a right to terminate a pregnancy in the Oklahoma Constitution and finding new state constitutional right to terminate a pregnancy when necessary to preserve life of mother); see also Order of Dist. Ct. Oct. 7, 2021 (CV-2021-2072) (denying temporary injunction based on challenge under state constitution). This Court has said that our limited role regarding federal constitutional questions "is to apply federal constitutional law, not to make it nor to guess what it may become." Okla. Coal. for Reprod. Justice, 2019 OK 33, ¶ 17, 441 P.3d 1145, 1152 (quoting Burns v. Cline, 2016 OK 121, ¶ 7, 387 P.3d 348, 351. I cannot agree with a holding in which we find the district court abused its discretion, against the clear weight of the evidence, when the district court denied an injunction--applying this Court's precedent, rather than trying to guess what this Court would hold in the future regarding state constitutional law. ¶2 Further, in its analysis regarding whether the statutes in question are likely to violate the new constitutional right that this Court found in OCRJ I, the majority repeatedly cites to cases from this Court applying the United States Supreme Court's former undue burden analysis. I do not believe any of this Court's past cases that applied the United States Supreme Court's caselaw regarding abortion are relevant at this time. In Dobbs, not only did the United States Supreme Court specifically disclaim the undue burden analysis, the Court also found that rational-basis review is the appropriate standard for challenges to state abortion regulations under the federal constitution. Dobbs v. Jackson Women's Health Org., 142 S. Ct. 2228, 2275, 2283, 213 L. Ed. 2d 545 (2022). But in OCRJ I, rather than choosing to apply the same standard of review as the United States Supreme Court, either pre- or post-Dobbs, the majority inexplicably applied a strict scrutiny analysis. See OCRJ I, ¶ 11 (Darby, J, dissenting) (noting the lack of explanation or citation to relevant caselaw for the new standard of review). Any analysis involving a potential "undue burden" is not part of a strict scrutiny review. Finally, I believe the majority opinion here misconstrues and misapplies the per curiam opinion in OCRJ I and attributes to it holdings I do not see. As such, I respectfully dissent. KUEHN, J., DISSENTING: ¶1 In Oklahoma Call for Reproductive Justice v. Drummond (OCRJ I), 2023 OK 24, ¶ 9, 526 P.3d 1123, this Court held that abortion was prohibited in Oklahoma with a limited exception: the Oklahoma Constitution contains a limited right to terminate a pregnancy when necessary to preserve the life of the mother. I dissented to that opinion and I continue to disagree with it; I cannot find language in the Oklahoma Constitution which supports such a right, and I believe the creation of any right to abortion should be done by the people of Oklahoma, through initiative petition or their elected representatives. OCRJ I, 2023 OK 24, ¶ 9, 526 P.3d at 1158 (Kuehn, J., dissenting). However, I also believe that, having made that decision, this Court is compelled to give it full effect -- which the Majority here fails to do. ¶2 Appellants filed suit in Oklahoma County District Court in September 2021, claiming that five bills relating to abortion violated the due process section of the Oklahoma Constitution. All five bills were to go into effect on November 1, 2021. After a hearing, on October 7, 2021, the district court granted the request as to two bills but denied a temporary injunction as to the remaining three. None of those bills directly prohibit abortion itself; as the Majority explains, they involve physician board certification and admission privileges, ultrasounds, and reporting provisions, and provide criminal and civil penalties. Appellants filed a petition in error in this Court on October 13, 2021, and we granted a temporary injunction pending appeal shortly thereafter. In 2022, the United States Supreme Court decided Dobbs v. Jackson Women's Health Org., 142 S. Ct. 2228 (2022). And this Court decided OCRJ I in 2023. These dates are not incidental: they are the heart of the problem. ¶3 After summarizing the OCRJ I ruling, the Majority engages in a substantive analysis of Appellants' claims. The Majority describes the various statutory provisions at issue, summarizes the parties' arguments, purports to describe and analyze the effects and consequences of each bill, and concludes that the "clear weight of the evidence presented" shows that the bills would "place unnecessary burdens on the lawful termination of a pregnancy". Thus, the Majority determines that the trial court erred in refusing to enter a temporary injunction prohibiting the bills' enforcement. This conclusion -- that the effect of the bills violates the limited right to abortion granted by the Oklahoma Constitution -- addresses the first factor in the right to injunctive relief. The Majority has found that Appellants are likely to succeed on the merits in their claim because the bills are unconstitutional. ¶4 The Majority frames this as a decision on a temporary injunction, without deciding the underlying constitutional claim. However, it is impossible to say that the bills are unconstitutional for injunctive purposes and yet pretend that they may not be unconstitutional for every purpose. In fact, the Majority makes a substantive finding on the merits of Appellants' claims. The problem is that there is no evidence in the record on which this Court may base such a finding. The Majority recognizes that this Court only recently discovered a limited right to abortion in the Oklahoma Constitution. However, Appellants' claims were presented to the district court in the autumn of 2021, to determine the constitutionality of bills which went into effect in November 2021, well before we decided OCRJ I. In fact, all three bills were adopted and went into effect before the Supreme Court's decision in Dobbs. Consequently, the district court was unable to take into consideration either the Supreme Court's ruling or the limited scope of the right to terminate a pregnancy this Court has since found in the Oklahoma Constitution. All parties tailored their presentations to the district court in service of a much broader claim -- a right to abortion, elective or otherwise, found in the Oklahoma Constitution -- and the court's determinations were made with that claim in mind. Moreover, at the time the district court heard this issue, there was no clear right to abortion of any kind based in the Oklahoma Constitution, as this Court had not yet decided OCRJ I. We presume that the district court based its decision to deny injunctive relief as to these bills based on the law in effect at the time. ¶5 This case is before us on appeal from a district court decision. The district court had no opportunity to consider the evidence in light of the law as it is now. No record was developed below as to whether any of the three bills at issue here (or, for that matter, the two bills for which an injunction was granted) violate the limited right to terminate a pregnancy to preserve the life of the mother. This Court is not a finder of fact. Howard v. Zimmer, 2013 OK 17, ¶ 34, 299 P.3d 463, 474. Yet, the Majority confidently recites "facts" and "evidence" to support its conclusion that the bills do in fact violate that right. These "facts" apparently come from affidavits provided by the parties, all filed before this Court's decision in OCRJ I. In general, affidavits may help this Court determine the merits of a given issue. However, these affidavits were filed before the controlling cases were decided and before the parties had the chance to address the current law. ¶6 I would remand this case to the district court to allow the parties and that court to address these claims in light of the current law. The district court can then decide to issue a temporary injunction, or not, based on relevant evidence and argument. Should any party appeal, this Court can decide that appeal on a record developed below. By directing the district court to enter a temporary injunction, this Court ensures that no court will have an opportunity to consider the request for an injunction on its merits in light of the law.1 Although this case has been pending in this Court for several years, that is no excuse to rush a fundamental decision. ¶7 It is possible, after hearing evidence and argument based on the current law, that the district court will apply the Majority's holding in OCRJ I and find one or more of these bills unconstitutional. It is possible that evidence will show one or more of the bills does not in fact place unlawful burdens on the limited right to terminate a pregnancy, as set forth in OCRJ I. But it is certain that any finding this Court makes now must be based on anecdote and speculation. I dissent. ¶8 I also concur in Justice Rowe's dissent to the Majority's unnecessary comment that OCRJ I made no ruling on whether the Oklahoma Constitution provides a right to elective termination of pregnancy. This flatly contradicts both the reasoning and holding of OCRJ I: if the Oklahoma Constitution protected elective abortions, there would be no need to discover a limited protection in contemporaneous statutory language, and when the Court found a limited protection using Dobbs reasoning, it foreclosed the possibility of finding a more expansive right in the same language. FOOTNOTES 1 What is the trial court to do on remand? Appellants raised claims regarding five bills below. After a hearing the district court granted a temporary injunction as to two of them. Appellants appealed the denial of the injunction as to the remaining three, and all the proceedings below were stayed. None of the substantive claims have been heard on their merits; presumably we are remanding the case to allow the merits determination to proceed. The district court will make that determination in light of Dobbs, OCRJ I, and the holding in this appeal, in which the Majority squarely finds the three bills which are the subject of this appeal unconstitutional. Surely, as to these claims, the district court must give effect to that conclusion, finding for Appellants as a matter of law. And the district court must decide how this decision affects the analysis of the remaining bills.

a1b7a7bc-1ca6-4217-8579-b7a2d8621867

Hamilton v. Welsh

oklahoma

Oklahoma Supreme Court

HAMILTON v. WELSH2023 OK 103Case Number: 119694Decided: 10/24/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE ESTATE OF KATHA MAE WILLIAMS, KIMBERLY HAMILTON, as Personal Representative of the ESTATE OF KATHA MAE WILLIAMS and as Trustee of THE WILLIAMS FAMILY TRUST DATED THE 28TH DAY OF MAY 2014, Petitioner/Appellee/Respondent, v. CATHERINE Z. WELSH, as Personal Representative of the ESTATE OF EARL WILLIAMS, JR., Respondent/Appellant/Petitioner. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III HONORABLE KURT G. GLASSCO, TRIAL JUDGE ¶0 The parents of Elliott Williams created their individual wills and joint trust after Elliott died. A wrongful death lawsuit was filed on Elliott's behalf, and the Williamses were statutory beneficiaries to proceeds from the lawsuit. Before they received any such proceeds, they attempted to transfer them into their trust for estate planning purposes. Both parents subsequently died before the proceeds were determined or distributed. The petitioner, the personal representative of Elliott's mother's estate, then sought to have Elliott's mother's share judicially determined to belong in the trust. The trial court determined they belonged in the trust. The personal representative of the father's estate appealed, and the Court of Civil Appeals affirmed. We hold that the proceeds from a wrongful death lawsuit can be transferred into a trust before they are obtained by the trust settlor, and if they are, they belong in the trust. COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT AFFIRMED. Catherine Z. Welsh, Jim C. McGough, Tulsa, Oklahoma, for Respondent/Appellant/Petitioner. George M. Miles, Maureen M. Johnson, Tulsa, Oklahoma, for Petitioner/Appellee/Respondent.1 KAUGER, J.: ¶1 The first impression question presented is whether proceeds from a wrongful death cause can be transferred into a trust before they are obtained by the trust settlor. We hold that they can, and if they are, they belong in the trust. FACTS/PROCEDURAL HISTORY ¶2 This cause concerns a lengthy, convoluted court battle over the estate of Katha Williams (Katha/wife) and the distribution of her interest of $1,178,157.44 from a wrongful death lawsuit involving her son, Elliott Williams (Elliott). However, the facts leading up to this controversy are also interconnected with her husband Earl Williams's (Earl/husband, collectively the Williamses) probate, and the family's trust, and their son Elliott's probate and wrongful death lawsuit. ¶3 The probates have not been consolidated, but some factual information about the interconnections is helpful to set forth the facts, timeline, and procedural history of this cause. To this degree, we take judicial notice of those proceedings.2 However, taking such judicial notice is not meant, in any way, to supplant the rule that the record on appeal consists of only those materials which were before the trial court at the time of the decision appealed, unless otherwise ordered by a court.3 ¶4 The Williamses' son, Elliott, died on October 27, 2011, after being arrested by Owasso police for causing a disturbance. Once in jail, he became paralyzed from injuring his neck and died without receiving any mental health or medical treatment.4 He left behind a surviving wife, but no children as heirs. Elliott's probate (PB-2011-724) was initially filed November 7, 2011, in the Tulsa County District Court. As a result of his death, a wrongful death action was also filed the same day in the United States District Court for the Northern District of Oklahoma (No. 11-CV-720-JEDC-PJC) against the Sheriff of Tulsa County. Pursuant to Oklahoma's wrongful death statute, the wrongful death action is filed by the decedent's personal representative.5 Damages, when the decedent has a surviving spouse, no children, and surviving parents are distributed to the spouse and parents as provided by 84 O.S. 2021 §213.6 ¶5 On May 28, 2014, the Williamses, established the Williams Family Trust together, and executed individual wills. Their wills, in identical provisions, left each of their estates to the Williams Living Trust.7 Each will also listed their heirs to include, their spouse, eight living adult children, and their deceased son, Elliott.8 ¶6 Katha Willaims died on July 24, 2014. On March 22, 2017, final judgment was entered in Elliott's wrongful death lawsuit in accordance with a jury verdict. The jury awarded $10 million in compensatory damages and $250,000.00 in punitive damages. Post judgment motions were all denied by March 31, 2018, and the defendants appealed to the Tenth Circuit Court of Appeals. ¶7 On March 23, 2017, the Williamses' daughter, Kimberly A. Hamilton (Hamilton) filed Katha's probate as personal representative in the District Court of Tulsa County Oklahoma (PB-2017-231), with a copy of Katha's will attached.9 The trial court admitted the will to probate and issued letters testamentary on June 13, 2018, and appointed Hamilton the personal representative. On August 20, 2019, the Tenth Circuit affirmed in part and reversed in part the wrongful death judgement. It affirmed the district court on all grounds, with the exception of the denial of the Sheriff's motion for a set off. On December 2, 2019, the parties settled, disclosing the settlement for $10 million plus post-judgment interest at 4.75% per annum, with an agreed judgment against the Tulsa County Sheriff. ¶8 The record is unclear, but it appears that at some point in 2017, Katha's husband, Earl Williams, was placed under a guardianship in the Tulsa County District Court (PG-2017-141).10 He died on August 31, 2019, and Hamilton, as personal representative of her father's estate, filed his probate (PB-2018-879) on October 9, 2019, in the District Court of Tulsa County. A copy of his will was attached, and it listed the same eight living children and one deceased child, as Katha's. On January 6, 2020, the trial court appointed Hamilton as the Special Administrator of her father's estate. At this point, Elliott's, Katha's, and Earl's estates were all still pending. ¶9 The last docket entry for Elliottt's probate is an order dated and filed June 30, 2020, in which it appears the trial court approved a new administrator, identified Elliott's wife and parents as his only heirs, and approved payment of attorney fees. It also identified the judgment of the wrongful death action to be the sole asset of Elliott's estate. ¶10 On May 11, 2020, the trial court admitted Earl's will to probate, and appointed the petitioner/appellant, an attorney, Catherine Z. Welsh (Welsh) as administrator of his estate. No explanation is given as to why Welsh replaced Earl's daughter, Hamilton as administrator. On August 6, 2020, Welsh, in Katha's probate, filed a Certificate to Make Election by Surviving Spouse on behalf of Earl. This filing was an apparent attempt for the deceased husband's election against his wife's will, even though, 84 O.S. 2021 §44(B)(4) expressly requires such an election to be done during the lifetime of the surviving spouse.11 This statutory provision reflects the primary purpose of a spousal election, which is to provide the surviving spouse ample means for his or her care and comfort during the remainder of his or her life.12 ¶11 On March 18, 2021, Hamilton, as trustee of the Williams Family Trust, filed a motion, seeking a determination that the proceeds of Elliott's wrongful death case were property of the Trust, rather than Katha Williams's probate estate.13 Hamilton attached a copy of a portion of the Trust, and a copy of an document labeled "Assignment" by the Williamses of their interest in the lawsuit judgment to their Trust. The document, dated May 28, 2014, and titled, "Assignment of Judgments" provides: EARL WILLIAMS and KATHA M. WILLIAMS do hereby transfer and assign, without consideration and in order to change formal title only, all right, title and interest which they now have in those Judgments listed below, to EARL WILLIAMS and/or KATHA M. WILLIAMS, Trustees, or their successors in trust, under the WILLIAMS LIVING TRUST, dated May 28, 2014, and any amendments thereto: Case Number Court Judgment Amount Judgment Debtor 11-CV-720-JED-PJC Tulsa, OK Pending Stanley Glanz, Tulsa County Sheriff, and City of Owasso Police Dept. 201300019896 Montgomery, AL Pending Talcum powder litigation Through Goldwater Law Firm This assignment was executed on May 28, 2014. ¶12 The trial court held a hearing on the issue on June 14, 2021. On June 30, 2021, the trial court filed an order in which it determined that the proceeds were not property of the probate estate. The trial court allocated proceeds in the amount of $1,178,057.44 be distributed to the Williams Family Trust.14 ¶13 On July 6, 2021, Welsh filed an Application to Assume Original Jurisdiction and Petition for Writ of Mandamus in this Court. She sought this Court's review of the trial court's ruling. The respondent replied that Welsh was trying to circumvent the proper appeals process by requesting a writ. We agreed, and on September 13, 2021, the Court directed Welsh to file an amended petition in error within twenty days. ¶14 On October 4, 2021, Welsh filed the Court-directed amended petition in error, appealing the trial court's June 30, 2021, order. The response to the petition in error contends that the appeal is immaterial because the entirety of Katha's probate estate goes into the Williams' Family Trust pursuant to her will. ¶15 On March 2, 2022, we assigned the cause to the Court of Civil Appeals. On May 20, 2022, the Court of Civil Appeals, Division III, in an unpublished opinion, affirmed the trial court. Welsh filed a Petition for Writ of Certiorari on June 9, 2022. We granted certiorari on February 7, 2023. PROCEEDS FROM A WRONGFUL DEATH CAUSE CAN BE TRANSFERRED INTO A TRUST BEFORE THEY ARE OBTAINED BY THE TRUST SETTLOR, AND IF THEY ARE, THEY BELONG IN THE TRUST. ¶16 The petitioner argues that because a wrongful death claim is a tort, it is not assignable to another person, and any proceeds from a wrongful death lawsuit or settlement must also be unassignable. The respondent argues that such proceeds may be transferred and, if they are, they belong in the trust. They are not a part of the probate estate. ¶17 The Williamses transferred their expected interest in any proceeds of the wrongful death lawsuit to their trust. Consequently, the term "transfer" is more apropos to what the Williamses were trying to accomplish, rather than an "assignment" to another person.15 Nevertheless, the answer to whether a transfer of such proceeds can occur requires examination of the nature of wrongful death claims juxtaposed with the nature of an estate planning mechanism such as a trust. A. A Wrongful Death Claim and Its Proceeds. ¶18 Because wrongful death actions were unknown at common law, any right to bring an action is granted by virtue of statute.16 In Whipple v. Phillips and Sons Trucking, LLC., 2020 OK 75, ¶10, 474 P.3d 339, we discussed the nature of wrongful death actions when a mother sought recovery for the wrongful death of her unmarried, childless adult son. The Court held that the action for wrongful death is not a separate and distinct tort, but is an action which derives from the rights of the decedent. Whatever rights the decedent might have had in his life accrue to the personal representative at death. ¶19 We also determined because the cause of action for wrongful death is purely statutory, suit may only be brought by a person expressly authorized by statute to do so. Under the applicable statute, if no personal representative had been appointed, the action may be brought by a surviving spouse or in their absence, next of kin. Implicit in this rationale is that the right to bring the cause of action for wrongful death cannot be either assigned or transferred.17 ¶20 Furthermore, 12 O.S. 2021 §2017 expressly prohibits the assignment of claims not arising out of contract.18 However, this cause does not concern the assignment or transfer of a wrongful death claim. Rather, it concerns the transfer of any expected proceeds of such action into a trust.19 Elliott's wrongful death lawsuit had been filed before his parents created their wills or trust. They both died before the any wrongful death proceeds were determined or distributed.20 Thus, the question here is whether the proceeds from the pending wrongful death action are transferable, not just from anyone to just anyone, but by the statutory entitled beneficiaries into their trust for estate planning. Our prior wrongful death cases shed light on this distinction. B. Prior Wrongful Death Cases ¶21 Although this Court has decided many cases concerning wrongful death actions, two in particular stand out for their discussion of the nature of the action, and its expected proceeds. In City of Shawnee v. Cheek, 1913 OK 739, ¶¶18-23, 137 P. 724, the Court discussed the nature of a wrongful death action when a child died because of the alleged negligence of a landowner. At the time, the father was the statutory beneficiary under the wrongful death statute. The father sued the landowner, but the father died ten months after the child, before the lawsuit went to trial. The lawsuit was then revived by the child's mother, as administratrix of the father's estate. ¶22 The Court explained that when a wrongful death occurs, the nature of a wrongful death action is similar to the nature of property, and it is a right created or granted by statute. As such, when the father died, it did not extinguish his statutory right to bring a wrongful death action. The action was properly revived by the administratrix of the father's estate. The Court quoted a New York case which explained that the Legislature has chosen to regard wrongful death as a pecuniary right, a right having the essential attributes of property, so that when it is taken away, compensation is due. ¶23 The Court also relied on a New Jersey case which stated that the death of the beneficiary of a wrongful death suit (i.e., the father) cannot be made to abrogate the liability of the wrongdoer because the pecuniary injury was already sustained. The right to compensation vested in the father immediately upon the death of the child. Recovery is not precluded just because the wrongful death statute does not provide for what happens if he died before the wrongful death action was finally determined. However, the injury sustained would be limited to the duration and extent of the father's lifetime. ¶24 As we previously stated, wrongful death actions are strictly governed by the statutes creating and governing them. As such, the statutory beneficiary may not have the ability to assign or transfer a wrongful death cause of action to another person. Nevertheless, such actions are similar to a property right, already vested in the beneficiaries upon the wrongful death.21 ¶25 Under the rationale of Cheek, Katha's rights as a statutory beneficiary of her son's wrongful death action vested on the death of her son. Such a right was the equivalent of a property right belonging to her. She never transferred, or attempted to transfer, her right. Consequently she did not violate the statutory prohibition relating to the assignment of claims not arising out of contracts.22 ¶26 In Aetna Casualty & Surety Co. v. Young, 1924 OK 394, ¶9, 231 P. 261, a case concerning the distribution of wrongful death proceeds, the Court described monies recovered by the administrator of the estate of the deceased. The Court found such monies do not belong to the estate of the deceased, but rather they are held in trust, for the benefit of next of kin of the deceased. It is the duty, then of the trustee, to properly distribute the money proportionately to the beneficiaries of the funds. ¶27 Under the rationale of Young, the proceeds from the wrongful death action were akin to trust funds held for statutory beneficiaries such as Katha, for her benefit. 25A C.J.S. Death §118, (August 2023 Update) provides: The trust under which the personal representative or other statutory wrongful death plaintiff holds the damages recovered in a wrongful death action may be enforced by the beneficiaries. A beneficiary may recover a share by an action against the personal representative, or other statutory trustee of the recovery, and as such proceedings, as trust proceedings, are not subject to a bar of time limitations. However, a beneficiary cannot maintain such an action until the net amount for distribution and the respective shares of the beneficiaries have been determined.23 The wrongful death statute gives survivors a beneficial interest in the recovery,24 and recovery inures to the exclusive benefit of the wrongful death statutory beneficiaries.25 Nevertheless, nothing about the nature of the anticipated funds from the lawsuit prevented Katha from transferring her interest in them to the family trust for estate planning purposes. Nor has the Legislature prohibited such a transfer in the either the wrongful death or wills and trusts statutes. C. Trusts ¶28 A trust, in relation to realty or personalty, may be created for any purpose for which a contract may be made.26 It requires a declaration by the owner of the property that he or she holds it as trustee for another person or for him or herself. The transfer can be inter vivos and/or by will.27 And the principal of the trust can be set aside for an eventual conveyance to another person.28 ¶29 In other words, the Williamses employed a common estate planning device of creating a revocable inter vivos trust, and simultaneously executing pour over wills to provide for their heirs at the time of their death.29 They sought to transfer their expected proceeds from their son's wrongful death lawsuit into their estate planning regime. ¶30 Although there are conflicting cases, the weight of authority is that such transfers are valid.30 One explanation is that a wrongful death beneficiary's interest in the lawsuit's proceeds is not akin to assignment of the right of the action for personal tort.31 Another is that it amounts to a pecuniary right, akin to property right, where when taken away, compensation is due.32 ¶31 The Utah Supreme Court in, In re Behm's Estate v. Gee, 213 P.2d 657 (Utah 1950), succinctly explains why proceeds for a wrongful death lawsuit are assignable. It said in pertinent part: . . . We conclude that respondent's portion of the death claim is assignable. Respondent's contention is that such a holding would overrule those cases in which this court had held that a cause of action for wrongful death is non-assignable. Had respondent attempted to assign a cause of action for death then the cases cited would have been controlling. However, appellant assigned not the cause of action, but rather, assigned any interest he might have in the recovery. While at first blush this may appear to be a distinction without a difference, upon closer examination it becomes apparent that there is a real and substantial difference. The cause of action cannot be split up between the heirs but the amount recovered can be and is. The problem thus presented is this. Can an heir, after a cause of action has arisen in which he has an interest make an assignment of his interest? Much has been said by courts in the past regarding the assignability and non-assignability of contingent interests at law and in equity. Law courts originally refused to recognize assignments of contingent interests of any kind. Later, because of the Chancellor's liberal enforcement of such assignments, the judges presiding in courts of law agreed to uphold assignments of contingent interests having a potential realization at the time of the assignment. Modern courts, however, have adopted the more liberal equitable rule enforcing assignments of things not in esse but mere future possibilities so long as the assignments are fairly made for an adequate consideration without offending against public policy. Thus assignments of future contractual interests, anticipated interests in real or personal property, future wages or the expectancy of an heir in the estate of an ancestor have all been repeatedly upheld by modern decisions. Courts have adopted the same rule where one who has sustained personal injuries assigns such proceeds as may possibly be recovered by him in an action brought against the tort-feasor. Moreover, a court of equity will enforce the assignment even though the cause of action is not assignable.. . . The counter views are that they are not transferable because they either do not survive the death of the beneficiary who is entitled to the proceeds, or that the wrongful death statutes make no provision for recovery for "others," including transfers.33 ¶32 Here, nothing more than a transfer into a revocable inter vivos trust occurred for purposes of estate planning. The transfer was Katha's personal interest in the proceeds of the wrongful death suit to Katha, as the settlor, trustee, and beneficiary of the trust. The petitioner has not shown that consideration is necessary for this type of transfer. Prohibiting such a transfer is counterintuitive to the nature of a trust, general estate planning altogether. It is also contradictory to this Court's prior treatment of wrongful death proceeds. ¶33 Furthermore, Katha's unambiguous expressed intent as evidenced on the face of her will, the trust, and the assignment of the wrongful death proceeds was that: 1) the funds be placed in the trust when received; but 2) if they were not placed into the trust, her pour-over will would place them into the trust. Under the facts of this cause, it appears equity would recognize the transfer.34 Regardless, we affirm the trial court and hold that proceeds from a wrongful death cause can be transferred into a trust before they are obtained by the trust settlor. We hold that they can, and if they are, they belong in the trust. CONCLUSION ¶34 This cause concerns the transfer of expected proceeds of a wrongful death action into a trust for estate planning. Wrongful death actions, insofar as the statutory beneficiaries are concerned, are vested upon the wrongful death.35 The proceeds of such lawsuits are akin to trust funds held for the statutory beneficiaries.36 Nothing in the will and trust statutes prohibits the transfer of expected proceeds into a trust. Prohibiting such a transfer would be counterintuitive to the nature of an estate trust, and our prior treatment of wrongful death proceeds. Consequently, we hold that proceeds from a wrongful death cause can be transferred into a trust before they are obtained by the trust settlor, and if they are, they belong in the trust. The trial court's determination that Katha's interest in her son's wrongful death suit belongs in the Williams Family Trust is affirmed. COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT AFFIRMED. ALL JUSTICES CONCUR. FOOTNOTES 1 Attorneys Travis D. Horton, and Benjamin Fu, of Tulsa, Oklahoma, entered an appearance as counsel for Tracy Samuels who is not a listed party in this cause, but is interested in it. However, they are not listed as the attorneys on the first page of the opinion because they are not representing a designated party. Title 12 O.S. Supp. 2022 App. 1, Oklahoma Supreme Court Rules, Rule 1.5 (a) provides: (a) Entry of Appearance. All parties to any proceeding in the appellate courts shall immediately, but no later than filing the first document in the appellate court, file an Entry of Appearance on the forms set forth in Rule 1.301, by counsel or an unrepresented party representing himself or herself. Copies shall be served on all other parties. Attorneys shall use the form prescribed by Rule 1.301 Form No. 1, and parties representing themselves shall use the form prescribed by Rule 1.301 Form No. 2. An original and two (2) copies of the Entry of Appearance shall be filed with the Clerk of the Supreme Court. Title 12 O.S. Supp. 2023 App. 1, Rule 1.25(b) provides in pertinent part: The style and the sequence of the parties in an appeal shall be exactly the same as the style and sequence in the judgment or order from which the appeal is taken. 20 O.S. § 3002. Designations such as "et al." shall not be used in the style. Each party shall be designated in the caption as they were in the trial court followed by a slash " / " behind the trial court designation. For example, Plaintiff/Appellant, Plaintiff/Appellee, Defendant/Appellant, Defendant/Appellee. A party who is neither seeking relief on appeal, nor opposing another party's attempt to seek relief on appeal, has no appellate designation and remains listed in the style with the same designation as in the trial court. A party who seeks appellate relief but was not included in the caption of the trial court action shall be designated according to the appropriate appellate designation on appeal (e.g., appellant), without a trial court designation, and shall be last in sequence of the parties in the caption on appeal. . . . Unless a prior version of a statute requires the application of significantly different statutory language to this cause, all citations to the Oklahoma Statutes herewithin are to the most recent version. 2 This Court takes judicial notice of the Dockets of District and Appellate Courts. State ex rel. Oklahoma Bar Ass'n v. Layton, 2014 OK 21, ¶19, fn. 12, 324 P.3d 1244; Collier v. Reese, 2009 OK 86, ¶ 8, fn. 7, 223 P.3d 966. See, State ex rel. Oklahoma State Board of Examiners of Certified Shorthand Reporters v. Parrish, 2006 OK 91, ¶ 7 fn. 1, 152 P.3d 202; Mehdipour v. State ex rel. Department of Corrections, 2004 OK 19, ¶ 7 fn. 15, 90 P.3d 546; Myers v. Lashley, 2002 OK 14, ¶ 5, fn. 8, 44 P.3d 553. See, Ritter v. State, 2022 OK 73, ¶12, fn. 19, 520 P.3d 370. Title 12 O.S. 2021 § 2202 provides: A. This section governs only judicial notice of adjudicative facts. B. A judicially noticed adjudicative fact shall not be subject to reasonable dispute in that it is either: 1. Generally known within the territorial jurisdiction of the trial court; or 2. Capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. C. A court may take judicial notice, whether requested or not. D. A court shall take judicial notice if requested by a party and supplied with the necessary information. E. In a civil action or proceeding, the court shall instruct the jury to accept as conclusive any fact judicially noticed. In a criminal case, the court shall instruct the jury that it may, but is not required to, accept as conclusive any fact judicially noticed. In Ind. School Dist. #52 of Okla. County. v. Hofmeister, 2020 OK 56, ¶¶22-23, 473 P.3d 475 we stated: In federal court, judicial notice of fact may occur when the fact is not subject to reasonable dispute and it "can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." The Oklahoma statute has similar language. Some federal courts have stated a court may take judicial notice of an indisputably accurate fact on the world wide web (or internet), and public records and government documents available from reliable sources on the internet, such as websites run by governmental agencies may be used for the purpose of judicial notice. Some federal courts have also concluded public agency actions, factfinding, and decisions may be appropriate for judicial notice. ... 3 See, Oklahoma Supreme Court Rules, 12 O.S. 2021 App. 1., Rule 1.33 provides in pertinent part: . . .Only papers filed and exhibits presented to the trial court together with transcripts necessary to the appeal may be included in the record on appeal.. . . Rule 1.28(b) provides in pertinent part: . . .Materials which were not before the trial court at the time of the decision appealed are not properly part of the record on appeal without order of the trial court or the appellate court.. . . A party may not supplement the record on appeal by injecting into it material that was not before the trial court. United States Through Farmers Home Administration v. Hobbs, 1996 OK 71, ¶5, fn 11, 921 P.2d 338. 4 Matt Clarke, $10 Million Post-Appeal Settlement in Oklahoma Jail Prisoner Death Suit, Prison Legal News, pg. 60, (March 4, 2020), https://www.prisonlegalnews.org/news/2020/mar/4/10-million-post-appeal- settlement-oklahoma-jail-prisoner-death-suit/. 5 Title 12 O.S. Supp. 2020 §1053(A) provides: A. When the death of one is caused by the wrongful act or omission of another, the personal representative of the former may maintain an action therefor against the latter, or his or her personal representative if he or she is also deceased, if the former might have maintained an action, had he or she lived, against the latter, or his or her representative, for an injury for the same act or omission. The action must be commenced within two (2) years 6 Title 84 O.S. 2021 §213 provides in pertinent part: Second. If the decedent leave no issue, the estate goes one-half (1/2) to the surviving husband or wife, and the remaining one-half (1/2) to the decedent's father or mother, or, if he leave both father and mother, to them in equal shares; but if there be no father or mother, then said remaining one-half (1/2) goes, in equal shares, to the brothers and sisters of the decedent, and to the children of any deceased brother or sister, by right of representation. If decedent leave no issue, nor husband nor wife, the estate must go to the father or mother, or if he leave both father and mother, to them in equal shares: Provided, that in all cases where the property is acquired by the joint industry of husband and wife during coverture, and there is no issue, the whole estate shall go to the survivor, at whose death, if any of the said property remain, one-half (1/2) of such property shall go to the heirs of the husband and one-half (1/2) to the heirs of the wife, according to the right of representation. Title 12 O.S. Supp. 2020 §1053(C) provides: C. In proper cases, as provided by Section 9.1 of Title 23 of the Oklahoma Statutes, punitive or exemplary damages may also be recovered against the person proximately causing the wrongful death or the person's representative if such person is deceased. Such damages, if recovered, shall be distributed to the surviving spouse and children, if any, or next of kin in the same proportion as personal property of the decedent. For the purposes of actions maintained pursuant to subsection F of this section, "next of kin" as used in this paragraph shall mean the parent or grandparent who maintained the action as provided for in paragraph 3 of subsection F of this section. 7 The wills provided in pertinent part: 2.01 Pour-Over to My Living Trust All of my probate estate, excluding any property over which I might have a power of appointment, and after payment of expenses and taxes which are paid pursuant to this will, I give to the Trustee of the Williams Living Trust dated May 28, 2014, and executed prior to this will, to be added to the property of that trust and disposed of in accordance with its terms and any amendments prior to my death. 8 Elliott Williams' probate was also filed in the Tulsa County District Court as PB-2011-724 on November 7, 2011. The last docket entry in Elliott's probate was November 10, 2021, and it is an Order Appointing Administrator, Determining Identity of Heirs, Order Approving Sale of Personal Property and Order Approving Payment of Attorneys' Fees. 9 Apparently, the original will was found, and then filed on May 9, 2017. 10 The Williamses' daughter, Tracy Samuels, also filed a civil lawsuit against her father in 2016 for assault and battery, intentional infliction of emotional distress and punitive damages. That lawsuit settled on June 22, 2021 for $600,000.00 in exchange for dismissing an appeal which was pending in this Court in case No. 119,211. We dismissed that appeal on June 28, 2021. 11 Title 84 O.S. 2021 §44(B)(4) provides in pertinent part: 4. The right of election of the surviving spouse provided for in paragraph 2 of this subsection is personal to the surviving spouse and may be exercised only during the lifetime of the surviving spouse. However, if there has been a guardian or conservator duly appointed by a court of competent jurisdiction, and such court has judicially determined the surviving spouse to be incompetent, then such guardian or conservator may make the election on behalf of the surviving spouse, but only if the same is approved by the court having jurisdiction over such guardian or conservator. . . . The guardian or conservator may be appointed in any state, and may have been appointed at any time prior to the expiration of the time permitted for the election to be made as provided in paragraph 3 of this subsection.. . . (Emphasis supplied). 12 See, Turner v. First Nat. Bank & Trust Co., of Muskogee, 1953 OK 199, ¶0, 262 P.2d 897. 13 Hamilton filed the same document in Earl Williams's probate cause seeking the same relief. 14 The order made five findings/orders: 1. Earl and Katha Williams established the Williams Family Trust on May 28, 2014; 2. The trust was lawfully created and funded; 3. Katha Williams assigned her interest in the litigation of the Estate of Elliott Williams to the Williams Family Trust; 4. Proceeds from the sale of Elliottt Williams wrongful death judgment in the amount of $1,178,057.44 shall be distributed to the Williams Family Trust; and 5. The appeal bond in the amount of 125% of the amount ordered to be distributed shall be required to stay enforcement of the order. 15 While the terms assignment and transfer are seemingly interchangeable, in Noble v. Ft. Smith Wholesale Grocery Co., 1911 OK 310, ¶0, 127 P. 14, a debtor/creditor case concerning stock of merchandise and what constitutes a chattel mortgage, the Court first described "transfer" as the act by which the owner of a thing delivers to another with the intent of passing the rights which he or she has in it to the latter. It defined "assignment" as a transfer or setting over of property or some right or interest therein from one person to another, the term denoting not only the act of transfer, but also the instrument effecting it. In Hoffman v. Townsend, 1946 OK 325, ¶0, 178 P.2d 89, another case involving an attempted recovery of a debt by a creditor, the Court defined an "assignment" as an expression of intention by one that his or her rights shall pass to and be owned by another. It also distinguished between a legal assignment which must relate to a thing in being and not an expectancy or contingency and an equitable assignment which covers continent interests, expectancies and things potential. 16 Whipple v. Phillips and Sons Trucking, LLC., 2020 OK 75, ¶¶6-11, 474 P.3d 339; Wilson v. Gipson, 1988 OK 35, ¶20, 753 P.2d 1349; Thomas v. Cumberland Operating Co., 1977 OK 164, ¶6, 569 P.2d 974. Although, statutory, pursuant to The Okla. Const. Art. 23, §7, the statutory right may never be abrogated. It provides: The right of action to recover damages for injuries resulting in death shall never be abrogated, and the amount recoverable shall not be subject to any statutory limitation, provided however, that the Legislature may provide an amount of compensation under the Workers' Compensation Law for death resulting from injuries suffered in employment covered by such law, in which case the compensation so provided shall be exclusive, and the Legislature may enact statutory limits on the amount recoverable in civil actions or claims against the state or any of its political subdivisions. The purpose of Art. 23, §7 was to embody into the fundamental law, the constitution, the statutory right of action for wrongful death. Whipple v. Phillips and Sons Trucking, LLC., supra at ¶7; Thomas v. Cumberland Operating Co., supra at ¶21. 17 See, Ouellette v. State Farm Mut. Auto. Ins. Co., 1994 OK 79, ¶9, 918 P.2d 1363; Abel v. Tisdale, 1980 OK 161, ¶8, 619 P.2d 608 (A wrongful death action is purely statutory and the action can only be bought by a person expressly authorized to do so.). 18 12 O.S. 2021 §2017(D) provides: D. ASSIGNMENT AND SUBROGATION OF CLAIMS. The assignment of claims not arising out of contract is prohibited. However, nothing in this section shall be construed to affect the law in this state as relates to the transfer of claims through subrogation. 19 This distinction is noted in In re Behm's Estate v. Gee, 213 P.2d 657 (Utah 1950) which we discuss further on pages 19 and 20 of this opinion. 20 The petitioner relies on two cases in support of their argument which are inapplicable here. First, Johnson By and Through Lackey v. Schick, 1994 OK 109, 882 P.2d 1059 concerned an estate beneficiary who assigned all of his interest to another person. The Court held that such an assignment is void under Oklahoma law because the heir has not acquired a vested right to the property. It also held that an equitable assignment may be possible if adequate or sufficient consideration is made. Here, Katha's interest in a wrongful death action vested when her son died, see discussion page 16, infra, and the transfer of the proceeds of a wrongful death action were not sold or made to another person. Second, Rose Group, L.L.C. v. Miller, 2003 OK CIV APP 18, 64 P.3d 573 was cited as persuasive authority, but it too, is inapplicable to this cause. It involved the assignment of a tort judgment (fraud, breach of fiduciary duty, and other claims) which was held not to be vested until a judgment was issued in the tort case. Again, Katha's interest in the wrongful death cause vested when her son died. 21 This rationale was also later reconfirmed by the Court in Parker v. National Zinc Co., 1965 OK 152, 406 P.2d 493, when it held, in the context of workmen's compensation, that the cause of action for wrongful death possesses the quality of survivability and is not extinguished or abated by the death of the statutory beneficiary. 22 Title 12 O.S. 2021 §2017(D), see note 19, supra. 23 Thomas Muskus, J.D. and Karl Oakes, J.D., Apportionment of Proceeds Among Beneficiaries of Wrongful Death Action by Trustee or Representative -- Enforcement by Beneficiary. 24 Abel v. Tisdale, see note 17, supra; Brookshire v. Burkhart, 1929 OK 428, ¶17, 283 P. 571. 25 Ouellette v. State Farm Mut. Auto. Ins. Co., see note 18, supra. 26 Title 60 O.S. 2021 §175.2 provides: A trust in relation to real and personal property, or either of them, may be created for any purpose or purposes for which a contract may be made. C&C Tile v. Independent Sch. Dist. No. 7 of Tulsa, 1972 OK 137, ¶35, 503 P.2d 554. 27 Title 60 O.S. 2021 §175.6 provides: A trust may be created by: A. A declaration by the owner of property that he holds it as trustee for another person, or for himself and another person or persons; or B. A transfer inter vivos by the owner of property to another person as trustee for the transferor or for a third person; or C. A transfer by will by the owner of property to another person as trustee for a third person; or D. An appointment by one person having a power of appointment to another person as trustee for the donee of the power or for a third person; or E. A promise by one person to another person whose rights thereunder are to be held in trust for a third person; or F. A beneficiary may be a cotrustee and the legal and equitable title to the trust estate shall not merge by reason thereof. Provided, however, that no trust in relation to real property shall be valid, unless created or declared: 1. By a written instrument subscribed by the trustor or by his agent thereto authorized by writing; 2. By the instrument under which the trustee claims the estate affected. 28 Title 60 O.S. 2021 §175.3(G) provides: G. "Principal" means any real or personal property which has been so set aside or limited by the owner thereof, or a person thereto, legally empowered that it and any substitutions for it are eventually to be conveyed, delivered, or paid to a person, while the return therefrom, or use thereof, or any part of such return or use is in the meantime to be taken or received by or held for accumulation for the same or another person. 29 See, Welch v. Crow, 2009 OK 20, ¶17, 206 P.3d 599; Rickard v. Coulimore, 2022 OK 9, ¶8, 505 P.3d 920. 30 Andrea G. Nadel, J.D., Assignability of Proceeds of Claim for Personal Injury or Death, 33 A.L.R. 4th 82 (Originally published in 1984), superseding in part, R.D. Hursh, Assignability of Claim for Personal Injury or Death, 40 A.L.R.2d 500 (Originally published in 1955). 31 Anderson v. Anderson, 12 Ga. App. 706, 78 S.E. 271 (Ga. App. 1913). 32 Rice v. Postal Telegraph-Cable Co., 174 A.D. 39, 160 N.Y.S. 172 (N.Y. Sup. Ct. 1916); Quin v. Moore, 1 E.P. Smith 432, 15 N.Y. 432, 1857 WL 7060 (N.Y. App. 1857). 33 Andrea G. Nadel, J.D., Assignability of Proceeds of Claim for Personal Injury or Death, 33 A.L.R. 4th 82 (Originally published in 1984), superseding in part, R.D. Hursh, Assignability of Claim for Personal Injury or Death, 40 A.L.R.2d 500 (Originally published in 1955). 34 The subject of trusts and the control of trust estates is by courts of equity. In re Wallace Revokable Trust, 2009 OK 34, ¶2, 219 P.3d 536; Peyton v. McCaslin, 1966 OK 4, ¶11, 417 P.2d 316. 35 Parker v. National Zinc Co., 1965 OK 152, 406 P.2d 493; City of Shawnee v. Cheek, 1913 OK 739, ¶¶18-23, 137 P. 724. 36 Aetna Casualty & Surety Co. v. Young, 1924 OK 394, ¶9, 231 P. 261; 25A C.J.S. Death §118, (August 2023 Update).

8b2ef1b1-9989-4c65-8efb-c4221871559c

Rivenburg v. Cilberti

oklahoma

Oklahoma Supreme Court

RIVENBURG v. CILIBERTI2023 OK 109Case Number: 120042Decided: 11/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. In the Matter of the Estate of VELDA MAE RIVENBURG, Decease ) EARL AUSTIN RIVENBURG, Appellant, v. BRIDGET CILIBERTI, Personal Representative of the Estate of Velda Mae Rivenburg, Appellee. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I ¶0 The District Court of Garfield County, the Honorable Tom L. Newby, Associate Judge, ordered the admission to probate of a will executed in 2018 by Velda Mae Rivenburg, after denying challenges to the will brought by the testator's son. Son appealed. The Court of Civil Appeals, Division I, affirmed. Son sought certiorari review. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; ORDER OF THE TRIAL COURT REVERSED; REMANDED FOR FURTHER PROCEEDINGS Julia C. Rieman, Gungoll, Jackson, Box & Devoll, P.C., Enid, OK for Appellant. David C. Henneke, Enid, OK for Appellee. KUEHN, J. ¶1 Velda Mae Rivenburg (Rivenburg) passed away in February 2020 at the age of eighty-seven. She lived alone in the Garfield County home in which she was born. Besides her homestead, she owned several parcels of land as well as mineral interests and other assets. She is survived by one son, Appellant Earl Austin Rivenburg (Austin), and one daughter, Appellee Bridget Ciliberti (Bridget). This suit involves a contest to Rivenburg's last will. ¶2 In April 2018, Rivenburg fell ill. Bridget traveled from her home in Tennessee to help her mother. Austin, who was stationed overseas as a civilian employee with United States Government, obtained leave from his post to travel to Oklahoma. Austin spent a month attending to his mother in the hospital, and making and paying for renovations to her home so that it would be more handicap-accessible. The parties agree on one thing: Rivenburg feared spending her final days in a nursing facility. She hoped to depart this life from the home that her forbears had built. Austin testified that his goal was to take whatever actions were necessary to allow her to continue to live at home.1 ¶3 That summer, after Austin returned to his overseas job, he was contacted by a long-time friend of Rivenburg's, Karen Heizer. Heizer was concerned that Bridget might be manipulating their mother into selling or mortgaging real estate to help Bridget pay off debt. According to Heizer, Rivenburg said that Austin was aware of the situation and had no problem with it -- which, according to Austin's testimony, was untrue. Austin called his mother in June 2018 and broached the subject with her. Rivenburg became angry with him and hung up. Bridget's son later warned Austin that further contact with Rivenburg might cause problems, and even advised Austin not to travel home to visit his mother anymore.2 ¶4 Within weeks of returning to his job overseas, Austin received notice that Bridget had initiated guardianship proceedings for their mother. The topic had never been discussed while Austin was in Oklahoma. Writing to the court, Austin objected to Bridget being appointed guardian, listed examples of what he believed to be a history of Bridget's financial manipulation of their mother, and disclaimed any interest in acting as guardian himself. The guardianship was abandoned as soon as Rivenburg decided to change her will in September 2018. This will differed considerably from one Rivenburg had made in 2014, substantially reducing the property bequeathed to Austin in favor of Bridget.3 The reasons Rivenburg gave for this change are discussed in detail below. ¶5 After Rivenburg's death in early 2020, Bridget sought to probate the 2018 will and have herself named personal representative. Austin challenged the will, claiming it was the product of fraud and undue influence on Bridget's part. In a hearing that lasted several days, Austin presented evidence to support his challenges. The trial court granted demurrers to both of Austin's claims and admitted Rivenburg's 2018 will to probate. Austin appealed. We assigned the case to the Court of Civil Appeals (COCA), which affirmed the trial court in an unpublished opinion. Austin sought review by this Court. We granted certiorari to review the COCA's decision and to clarify the law applicable to will contests based on claims of fraud in the inducement of a will. STANDARD OF REVIEW ¶6 A will, or any part of a will, may be declared void if it was the product of "duress, menace, fraud or undue influence." 84 O.S. § 43. A will contest is a matter of equitable cognizance. In re Lacy's Estate, 1967 OK 123, ¶ 6, 431 P.2d 366. Once the proponent of the will establishes that it was duly executed in the manner prescribed by law, the burden shifts to the contestant to prove the will's invalidity. Tiger v. Peck, 1917 OK 376, ¶ 4, 176 P. 529; see also 58 O.S. § 41 (in a trial over a will contest, the contestant is plaintiff). Here, the parties agreed that Rivenburg's will was facially valid and that she had the capacity to make it. At the close of Austin's evidence, Bridget demurred to his undue-influence claim. The trial court granted demurrers on both of Austin's claims, thereby absolving Bridget from having to present any evidence to rebut either challenge. ¶7 The scope of our review is determined by the procedural posture at which the trial court's ruling was made. A "demurrer" is commonly understood as a challenge to the sufficiency of the evidence that has been presented by the party with the burden of proof.4 This is typically a low hurdle, and should only be granted if there is "an entire absence of proof" to support the non-moving party. Fletcher v. Meadow Gold Co., 1970 OK 135, ¶ 14, 472 P.2d 885). However, a different standard applies when the trial court sits as ultimate factfinder, as in matters of equity. See Looney v. Bruin Oil Corp., 1942 OK 67, ¶ 1, 122 P.2d 1007. When the trial is before a jury, the court cannot weigh the testimony upon a motion for a nonsuit, for the reason that it cannot weigh it at any time; but when the trial is without a jury, the court must eventually weigh the testimony for the purpose of determining where the preponderance is, and there is no reason why it should not so weigh it at the earliest possible time when the rights of the plaintiff will not be cut off by its so doing, and when the plaintiff has introduced all of his proof and rested, no right of his will be cut off if the court then determines what has been proven. Lowrance v. Henry, 1919 OK 170, ¶ 21, 182 P. 489 (emphasis added; citation omitted). Hence, the following rule applies in matters of equity: Instead of disregarding all evidence supporting the demurrant's position, and considering only the evidence favorable to plaintiff, together with all reasonable inferences to be drawn therefrom, and overruling the demurrer, if from such consideration, there is any evidence reasonably tending to support plaintiff's cause of action, the trial court, in an equity case, considers and weighs all of the evidence and determines in whose favor it preponderates. Henderson v. Gifford, 1957 OK 288, ¶ 10, 318 P.2d 404. ¶8 To summarize, on appeal from the grant of a demurrer in a case of equitable cognizance, the trial court's ruling will not be disturbed unless it is against the clear weight of the evidence. Id. That said, one challenging a will need only establish his case by a preponderance of evidence. In re Estate of Holcomb, 2002 OK 90, ¶ 42, 63 P.3d 9; Brown v. Minter, 1922 OK 222, ¶ 4, 207 P. 976. ANALYSIS ¶9 Austin only seeks review of the COCA's disposition of his fraud claim, not its handling of his undue-influence claim. He claims the COCA's analysis on fraud was flawed, and that the dearth of case law on the elements of fraud related to the making of a will warrants review and clarification by this Court. We agree that clarification of the law is warranted, and that the lack of guidance may have affected the COCA's (and the trial court's) analysis of what Austin was required to prove to survive a demurrer. Okla. Sup. Ct. Rule 1.178(a), 12 O.S., ch. 15, app. 1. ¶10 Our cases offer no discussion of the elements of fraud to procure a will.5 As to fraud generally, we have observed: Fraud is a generic term, which embraces all the multifarious means which human ingenuity can devise and which are resorted to by one individual to gain an advantage over another by false suggestions or by the suppression of truth. No definite and invariable rule can be laid down as a general proposition defining fraud, and it includes all surprise, trick, cunning, dissembling, and any unfair way by which another is cheated. Stapleton v. Holt, 1952 OK 408, ¶ 13, 250 P.2d 451 (citation omitted). Fraud usually involves some variation of the following elements: (1) a material, false representation; (2) made with knowledge of its falsity or reckless disregard for its truth; (3) made with the intent that it be acted upon by another; and (4) which is in fact relied upon by the other, causing injury. See Dawson v. Tindell, 1987 OK 10, ¶ 5, 733 P.2d 407; Dieterle v. Harris, 1917 OK 580, ¶ 5, 169 P. 873. ¶11 The standard treatise on Oklahoma probate law (citing cases from other jurisdictions) describes fraud in the procurement of a will as follows: On the whole, the requirements are not different from the necessary ingredients of actions for deceit. The representations must be made to the testator, either by the person benefiting under the will, or at least by someone in his or her behalf. The statements must be false, although under some circumstances suppression of the facts may be sufficient. Furthermore, the representation must be known to be false by the person making it. Innocent misrepresentation therefore does not invalidate the will. As in the case of deceit, the false statements must be made with the intention of procuring the will in question. Hence, a representation made after the execution of the will does not affect the validity of the instrument. Fraud that does not result in the making of the will is immaterial upon the question of whether the will should be admitted to probate. 1 Okla. Prob. Law & Prac. § 6.7 (3rd ed.) (footnotes omitted). Another treatise describes the elements this way: [Fraud in the making of a will] consists either of a material misrepresentation of fact known by the declarer to be false, or made with reckless disregard for the truth of the statement made, or a false concealment of fact, or an unprivileged nondisclosure by a person, with a duty to disclose, who intends to cause decedent, acting upon fraudulently induced mistake, to do or not to do a testamentary act which otherwise would not have been done. Eunice L. Ross & Thomas J. Reed, Will Contests (2nd ed.) § 8:10. We hereby adopt the following elements in the context of will contests, which are (as the Oklahoma treatise notes) essentially the same as those for other types of fraud: (1) a representation to the testator, made by one benefiting under the will or on their behalf; (2) which is false; (3) which is known to be false by the person making it; (4) which is made with the intention of procuring or affecting the will in question; and (5) which is shown to have had such effect. ¶12 After acknowledging some of the evidence which supported Austin's claim of fraud, the COCA found Rivenburg's execution of the will before a judge, without her daughter present, to be "compelling" evidence that Bridget did not participate in the drafting of the will. It also noted that Bridget claimed not to know the terms of the will before her mother executed it. These facts alone convinced the COCA that Austin had not met his burden of proof on the issue of fraud. We believe this to be error. ¶13 Fraud and undue influence are separate and distinct concepts. Rood v. Newberg, 718 N.E.2d 886, 892 (Mass.App. 1999); 1 Okla. Prob. Law & Prac. § 6.5. Fraud may play a part in an attempt to unduly influence a testator, but it does not have to. Undue influence alleges that the testator's mind was subtly coerced; fraud alleges that it was deceived.6 False information can come from anyone, anytime, and linger within the testator's mind until she is convinced that she must act, by making or changing her will.7 ¶14 When a will is challenged on the basis of undue influence on the testator, the challenger can shift the burden of producing evidence to the will proponent by establishing that the influencer (1) enjoyed a "confidential relationship" with the testator, and (2) "actively assisted in the preparation or procurement of the will." Holcomb, 2002 OK 90, ¶ 18, 63 P.3d 9. Facts commonly weighing against a presumption of undue influence include that the alleged influencer was absent when the will was executed; that she played no part in securing a lawyer for the testator; and that she was unaware of the terms of the will. See generally Ross & Reed, Will Contests (2nd ed.) § 7:5; see also Holcomb, 2002 OK 90 at ¶ 38. However, if the presumption of undue influence is successfully rebutted, the analysis does not end there: The will proponent's successful rebuttal of the presumption restores the case to the procedural posture it would have had if the presumption had never been operative. This means that contestants must prove the existence of undue influence by a preponderance of the evidence without the aide [sic] of the presumption. Holcomb, id. at ¶ 42 (footnotes omitted; emphasis added). In other words, while certain facts (such as one's absence when the testator executed her will) are of value to rebut a presumption of undue influence, they have no other special significance. Even after the presumption of undue influence has been rebutted, whether the will contestant has made a prima facie case for his challenge is still an open question, to be decided by considering all of the evidence.8 ¶15 Furthermore, the rebuttable presumption so often discussed in undue-influence cases has no application to allegations of fraud. See e.g. Silk v. Phillips Petroleum Co., 1988 OK 93, ¶ 13, 760 P.2d 174 (fraud is never presumed from the circumstances, but must arise from a preponderance of all of the evidence). To be sure, whether Bridget participated in the will-drafting process is relevant to whether she intended to deceive her mother, and whether there was a causal connection between any false statement and the making of the will. But it is simply one factor to be considered, along with everything else, to determine whether the evidence of fraud preponderates to the will challenger.9 ¶16 We believe the evidence presented thus far preponderated in Austin's favor on the claim of fraud. Our starting point -- and a fact never addressed by Bridget in her brief on appeal -- was what Rivenburg told the court about why she was changing her will. When presented with Rivenburg's new will, the judge asked if she had any questions about the proceedings. She replied: No. I only want you to understand that part of the reason that this was changed was the comments and things my son had done. [Austin] is not completely out of this will, but he will not get any of the land because he has told too many people that he wanted me to [be] declared incompetent, take over, and sell everything... Unless there is a challenge to a testator's mental capacity (and there is none here), her own explanation for why her will was made is obviously entitled to considerable weight. Cf. Holcomb, 2002 OK 90, ¶ 38 & n.34, 63 P.3d 9 (claim of undue influence was successfully countered by testator's own explanation to lawyer of why she was changing her will). ¶17 Rivenburg's statement to the court establishes a causal link between Austin's supposed plan and her testamentary act, which was less favorable to Austin and more favorable to Bridget than her previous wills. The remaining questions are whether the evidence preponderated in support of Austin's claims that his mother's fears were (1) based on false information, (2) communicated by Bridget with knowledge that the information was false, and (3) communicated for the purpose of gaining advantage in the distribution of their mother's assets upon her death. ¶18 The reason Rivenburg gave for changing her will was quite specific.10 It is the same reason that she and Bridget gave to the lawyer when they first met to discuss the guardianship process. Bridget emphasizes that her mother's decision to change her will was one she made independently, without Bridget's knowledge. But we find the relationships between Rivenburg, the lawyer, and Bridget -- indeed, the entire guardianship process that ultimately produced the will -- to be decidedly murky. ¶19 Shortly after Bridget arrived from Tennessee, she and her mother visited a local lawyer. The objective, according to testimony from the lawyer, was to discuss "different legal strategies" to prevent Austin from becoming Rivenburg's guardian, gaining control of her assets, and "be able to sell any farmland, or put [Rivenburg] in a nursing home."11 To that end, they decided to give Bridget control of Rivenburg's assets. Rivenburg's general competency was never in question; according to the lawyer, the guardianship was intended to "allow[] Bridget to help [her mother] with finances." ¶20 Strangely, however, the guardianship process was abandoned as soon as Rivenburg executed her new will -- even though they are ostensibly aimed at different goals (protection of assets while living versus distribution of assets after death).12 According to the lawyer, in the final analysis the guardianship "really didn't matter because the strategy was to make sure we would have proof that Velda was competent to revise her will." 13 Given this evidence, we are not persuaded that Bridget stood at arm's length from the testamentary act. ¶21 "Rumor" appears to be the appropriate word for Rivenburg's fears. She never claimed -- to her friends, to her lawyer, or to the court -- that her son made these threats directly to her. As for the source of the rumor, several witnesses testified either that (1) Bridget told them personally that this was Austin's plan; (2) Rivenburg told them personally that, according to Bridget, this was Austin's plan, or (3) they heard Bridget relate Austin's supposed plan to Rivenburg.14 One witness was a bank officer, who met with Bridget and her mother shortly after Austin had returned to his job overseas. The officer recalled that Bridget introduced herself as Rivenburg's guardian. The purpose of the meeting was to have Bridget named as joint owner or beneficiary on "just about all" of her mother's bank accounts. This witness specifically recalled Bridget talking to her mother about Austin's supposed plan to "put her in a nursing home" as the reason for making these changes.15 ¶22 Austin, of course, adamantly denied ever expressing a desire to take control of his mother's assets and place her in a nursing home. His statement to the court, after receiving notice of the guardianship action, was consistent with this position.16 Bridget was called as a witness at the hearing. She denied ever telling her mother that Austin had such a plan.17 Thus, Bridget's testimony was inconsistent with that of several presumably disinterested witnesses who traced the rumor to her.18 ¶23 On a claim of undue influence in the making of a will, one relevant fact is whether the testator received independent advice from third parties. Matter of Estate of Maheras, 1995 OK 40, ¶ 8, 897 P.2d 268. Attempts to control information that the testator receives are relevant to a claim of fraud as well. See Matter of Estate of Lint, 957 P.2d 755, 763 (Wash. 1998) (evidence supported finding of fraud in the procurement of a will, where perpetrator isolated the testator from family and friends, and falsely told her that her family wanted to put her in a nursing home and seize her estate). Austin presented evidence suggesting that Bridget isolated their mother from friends and associates. This lent some credence to the idea that Bridget was the source of Rivenburg's fears, since the best way to keep a false idea alive is to ward off those who might expose it.19 ¶24 A will contestant is entitled to the normal inferences which may be derived from the facts. White v. Palmer, 1971 OK 149, ¶ 26, 498 P.2d 1401 (regarding undue influence). An allegation of fraud almost always relies on circumstantial evidence. Griffith v. Scott, 1927 OK 361, ¶ 18, 261 P. 371. Each case depends on its own facts, and all relevant circumstances should be considered together in determining whether fraud has been proven. Id. Prior similar dealings by the alleged wrongdoer may be relevant. Silk, 1988 OK 93 at ¶ 14, 760 P.2d 174. Prior dealings may shed light on motive and witness credibility. Austin presented evidence that, aside from receiving considerable financial help from their mother over the years, Bridget had a history of questionable transactions involving their parents' assets.20 ¶25 We are always reluctant to second-guess trial courts on questions of fact. Rogers v. Pennington Grocery Co., 1925 OK 489, ¶ 4, 239 P. 126. Nevertheless, having clarified the legal analysis of fraud in the inducement of a will, our careful review of the record compels us to conclude that the totality of evidence thus far presented by the will challenger preponderated in his favor, and shifted the burden of production to the will proponent. CONCLUSION ¶26 Fraud and undue influence are independent grounds for challenging a will. They may overlap, but the concepts are distinct. The presumption of undue influence in certain situations has no application in cases of fraud. By the same token, facts that rebut such a presumption carry no special weight in analyzing claims of fraud. The Court of Civil Appeals erred by conflating the concepts of fraud and undue influence, and by treating certain facts as essentially dispositive as to both. The trial court should consider all relevant facts to decide if a testator's will was motivated by statements known to be false by the person making them. Here, ruling on a demurrer in a case of equitable cognizance, the question for the trial court was whether the evidence presented thus far preponderated in Austin's favor. We believe the evidence cleared that hurdle. While the ultimate burden of persuasion remains with Austin as challenger to the will, the burden of producing evidence to rebut an inference of fraud shifted to Bridget. Accordingly, the trial court's order admitting Rivenburg's will to probate is reversed, and the case is remanded to give Bridget an opportunity to present evidence on the issue of fraud.21 COURT OF CIVIL APPEALS' OPINION VACATED; ORDER OF THE TRIAL COURT REVERSED; REMANDED FOR FURTHER PROCEEDINGS CONCUR: Kane, C.J.(by separate writing), Rowe, V.C.J., and Winchester, Edmondson, Combs, Gurich, Darby and Kuehn, JJ. NOT VOTING: Kauger, J. FOOTNOTES 1 Austin said his mother was very upset that her two sisters had to spend their last days in nursing homes: "She would prefer to die on her farm. And it has always been my intent to honor my mother's wishes and do everything I can to ensure that that's possible." 2 Rivenburg had mortgaged a parcel of land in 2016 to provide money to Bridget. When Bridget was unable to make payments on the loan, Rivenburg sold the parcel to the Heizers, paid off the loan herself, and provided most of the remaining proceeds to Bridget. Despite this, Bridget characterized Karen Heizer as her mother's "worst enemy." Bridget characterized the receipt of profits from the sale of this parcel as an "early inheritance" for one of her sons. 3 Among other things, the new will gave Bridget a life estate in all of Rivenburg's real property and testamentary power over the remainder. 4 The proponent of the will may "demur" to the challenger's evidence for any of the reasons allowed in civil actions. 58 O.S. § 41. In civil actions, a demurrer is a challenge, in a jury trial, to the evidence that has been presented by the party who carries the burden of proof. 12 O.S. § 577. The meaning of the term demurrer has long been rather vague. As a challenge based solely on the pleadings, it has been abolished. 12 O.S. § 2007(C). And the notion of a demurrer to the evidence, in cases tried to the court, without a jury, has been problematic. We described it as an "anomalous practice" in Lyon v. Lyon, 1913 OK 509, ¶ 1, 134 P. 650: "[W]e know of no practice permitting a party, as a matter of right, to inquire into and test the probative effect of his adversary's evidence upon the mind of the judge before final submission of the case... ." Id. See also Davis v. Wallace, 1934 OK 523, ¶ 21, 37 P.2d 602 ("Properly speaking, there is no such practice as that of demurring to the testimony in an equity case") (citation omitted); Bailey v. Privett, 1917 OK 284, ¶ 2, 166 P. 150 (citation omitted) ("The practice of demurring to the evidence in cases tried to the court without a jury appears to be an anomalous procedure followed only by the courts of Kansas"). 5 In In re Sixkiller, 1934 OK 249, ¶ 20, 32 P.2d 936, we summarily found "no evidence whatever" to support the trial court's finding that a will was obtained by fraud. In Howard v. Fields, 1945 OK 62, ¶ 8, 156 P.2d 139, we affirmed a trial court's finding that no fraud in the inducement of a will was established, but did not discuss the elements of the claim in detail. 6 See in re Dand's Estate, 41 Wash. 2d 158, 247 P.2d 1016, 1020 (1952); see also 1 Okla. Prob. Law & Prac. § 6.5 ("When fraud is claimed, the will is questioned, not because testator has been subjected to pressure, but for the reason that he or she is deceived and acts upon false data"). 7 Cross-examination of Austin's witnesses, and Bridget's argument on appeal, focused on their mother's reputation as an independent and strong-willed woman. Such attributes may counter a claim of undue influence, but even the most strong-willed person can fall victim to deceit. 8 When a rebuttable presumption is available, it is nothing more than an evidentiary shortcut to shifting the burden of producing evidence. It possesses no probative weight of its own, and rebutting the presumption has no effect on the basic facts needed to prove the underlying claim. Stumpf v. Montgomery, 1924 OK 360, ¶ 11, 226 P. 65 ("When evidence is introduced rebutting the presumption, the presumption disappears, leaving in evidence the basic facts which are to be weighed"); Conaghan v. Riverfield Country Day School, 2007 OK 60, ¶ 13, 163 P.3d 557 (a rebuttable presumption "does not change the value or weight of the evidence"); McCormick, Evidence § 344 ("[A]lthough a presumption is available to permit the party relying upon it to survive a motion for directed verdict at the close of its own case, it has no other value in the trial"). 9 The COCA cited Holcomb when concluding that "the burden did not shift" to Bridget to produce evidence on either of Austin's claims. But Holcomb only involved an undue-influence claim, not a fraud claim. The COCA appears to have focused exclusively on facts that rebutted the presumption of undue influence in deciding whether the trial court's ruling about both claims was sound. 10 In her brief on appeal, Bridget posits some reasons why Rivenburg might have desired to reduce her bequest to Austin. She points to disagreements Austin and his mother had over the years, including one, several years ago, where Austin allegedly shoved his mother during an argument. Austin denied this event ever occurred, and neither Rivenburg's physician, nor any of her friends, ever heard anything about it. She also notes that Rivenburg hung up on Austin in their last phone conversation. She notes that Austin had no plans to reside in Oklahoma and planned to sell any land he might inherit. Austin's relationship with his mother may sometimes have been strained, but it appears that the troubles were often a family affair that included Bridget. And Rivenburg's relationship with Bridget was hardly ideal. Austin presented evidence that their mother had supported Bridget for years and resented it. Also, witnesses testified that Rivenburg was proud of her son's achievements and his career in service to his country. As for the notion that Austin would probably sell any real property bequeathed to him, Rivenburg appears to have been aware of that fact for some time; her previous will only bequeathed to Austin real property that had no sentimental value to her. And the notion that Rivenburg was firmly against selling any of her property is belied by the fact that in 2017 she sold a parcel to aid Bridget. In any event, none of these possible motives was actually mentioned by Rivenburg in her statement to the court about why she was changing her will. 11 The lawyer's recollection is confirmed by a colloquy at the initial guardianship hearing. Rivenburg said she was afraid her son would seize control of her assets and send her to a nursing home: "That's the reason I started it because I came and talked to you and that was the best way to go with this." The lawyer who first met with Rivenburg and Bridget to discuss guardianship, and who later drafted the will, is sometimes characterized in these proceedings as Rivenburg's lawyer, and sometimes as Bridget's lawyer. A different lawyer was appointed to represent Rivenburg in the guardianship proceeding, and that lawyer was unaware that Rivenburg had even changed her will. 12 Bridget was unable to post the guardian's bond put in place by the trial court. The lawyer never sought to have the bond reduced or waived because "we had the will signed, and so things were fine." 13 It is not clear why the guardianship was necessary for Bridget to help her mother with finances. As noted, Bridget had already gained a measure of control over her mother's bank accounts. One could infer that the guardianship process was simply a vehicle to produce a new will -- one with the imprimatur of the court, and therefore less subject to challenge. 14 As noted, the lawyer hired for the guardianship described this threat as the impetus for the initial meeting, and that meeting included Bridget. According to one friend who visited Rivenburg after release from the hospital, Rivenburg said, "Bridget told me [Austin] wanted to sell the land and put me in a home," and that that was the purpose of putting Bridget in control of Rivenburg's assets. The same friend testified that Rivenburg once "expressed duress" at having to assist Bridget financially, but said that "because Austin was going to sell the property and put her in a home, Bridget feels like she needs to, you know, be in control of my banking and business." This witness heard the same sentiment from Bridget herself. Another friend of Rivenburg's also heard Bridget say that Austin was trying to put their mother in a nursing home. This witness said Rivenburg expressed frustration at having to support Bridget, and once floated the idea of selling some of her property to Williams and her husband to provide funds to Bridget. 15 Bridget also commented at the time that she did not want Austin to find out about the changes, and accused the bank of having divulged information to Austin that it shouldn't have. When the bank officer assured her that probably was not the case, Bridget "mentioned that Austin must have gotten bank statements from [his mother's] house when no one else was there." 16 Not only did Austin disclaim any interest in serving as guardian, he also expressly supported his mother's desire not to sell her farmland -- which contradicts the theory that he planned to liquidate her estate before her death. 17 Bridget contradicted the lawyer's testimony about the purpose of setting up a guardianship. When asked if the purpose was to protect Rivenburg's assets from Austin, Bridget replied, "I wouldn't know what [Rivenburg] exactly thought" -- even though, according the lawyer, Bridget was party to the initial consultations. Bridget denied telling her mother that Austin planned to send her to a nursing home and seize control of her assets. She said she heard her mother repeat the rumor, but that her mother refused to reveal its source. Bridget did not relate any specific incident where she heard her brother make such a threat. In her deposition, Bridget said she had, in fact, told her mother "there have been times" when Austin expressed such an intention. But the only example she provided at the hearing was somewhat dubious. Bridget testified that many years ago, when she and Austin were discussing their mother's situation in general, she walked in and may have heard Austin say something to the effect of, "Is she competent to have the farm?" Bridget could not provide a date for this statement (which seems better characterized as a question, not a threat), but estimated it occurred around 2010. This was some eight years before Rivenburg made the will at issue here, and several years before Rivenburg's previous will, which was more favorable to Austin. Furthermore, Rivenburg did not tell the court that she was changing her will due to anything that Austin said in her presence; rather, she said that she had been "fed" this information by others. In another twist, Bridget was asked how Austin's supposed plan to send their mother to a nursing facility, and sell off her property, squared with his decision to take leave from his overseas job and spend a month in Enid remodeling her home. Bridget offered a new theory: that Austin worked on their mother's house to avoid sending her to a nursing home, since to pay for that expense, they would have to sell parcels of land that he hoped to inherit. 18 In discovery, Bridget asserted that Austin had expressed his plan in front of her and her son; at the hearing, Bridget's son could not recall any such event. 19 Karen Heizer, made many failed attempts to speak with Rivenburg between the summer of 2018 and Rivenburg's death. Heizer said that when she tried to visit Riverburg's home, Bridget refused to let her in, claiming Rivenburg "wasn't of right mind" and "couldn't handle visitors." While Austin was in town in early 2018, he and Bridget asked Rivenburg's long-time tenant farmer to continue overseeing operations for at least another year. However, once Austin left town, Bridget fired the tenant and refused to let him speak with Rivenburg personally. The tenant testified that when Bridget terminated his services, he was owed several thousand dollars for past work. When he tried to visit Rivenburg to at least settle the debt, Bridget ordered her mother to stay in the house. In a similar vein, there was evidence that Bridget attempted to distort the narrative about Austin's relationship with their mother when Bridget spoke to those outside the family. For example, Karen Heizer testified that after Rivenburg's funeral, Bridget commented that her mother "hated" Austin. Yet a hospice worker, who attended to Rivenburg in her last months, said Rivenburg talked about Austin a lot and was proud of him. 20 In December 2018, a few months after the will was changed, Bridget contacted Rivenburg's life insurance agent about changing the beneficiary designation on her mother's life insurance policy. The change that was made named Bridget as sole beneficiary, and Bridget's son as contingent beneficiary. Austin testified that his mother's signature on the form appeared to be in his sister's handwriting. In 2012, Bridget signed Austin's name to obtain a guardian's bond in reference to their father. Austin claimed she did not have his permission to do this; Bridget claimed that she did. As administrator of their father's estate, Bridget transferred title to a truck their father owned to herself, rather than to their mother as she and Austin discussed. 21 Gay v. Hartford Underwriters Ins. Co., 1995 OK 97, ¶ 12, 904 P.2d 83 ("If an order sustaining defendant's demurrer to plaintiff's evidence is found to be against the clear weight of the evidence, equity affords the defendant an opportunity to present evidence"). See also Ellis, Oklahoma Appellate Practice § 15:166 ("[W]here the procedural posture requires further proceedings a remand will be necessary. For example, the appellate court cannot render a judgment the trial court should have rendered if a party was deprived of a required opportunity to present its evidence before the trial court" (footnotes omitted)). C.J. Kane, with whom Combs, J. joins, concurring: ¶1 I concur with the opinion but write separately to elaborate upon the statutory procedure for a ward to execute a last will and testament. See 84 O.S. § 41. ¶2 The Court of Civil Appeals made the following observation in their opinion: "The fact Velda Rivenburg signed the 2018 Will before a judge and without her daughter being present either at the attorney meeting or in court is compelling evidence that Appellee was not part of the will drafting process." While the absence of the daughter may have been compelling evidence, I write to emphasize that execution of the will in front of the judge was not compelling evidence. In fact, subsection B of the statute provides: The appointment of a guardian or a conservator does not prohibit a person from disposing of his estate, real and personal, by will; provided, that when any person subject to a guardianship or conservatorship shall dispose of such estate by will, such will must be subscribed and acknowledged in the presence of a judge of the district court. The judge before whom the will is subscribed and acknowledged shall attest to the execution of the will but shall have neither the duty nor the authority to approve or disapprove the contents of the will. Subscribing and acknowledging such will before a judge shall not render such will valid if it would otherwise be invalid. 84 O.S. § 41(B) (emphasis added). ¶3 Hence, execution in front of a Judge of the District Court was statutorily required, but not compelling evidence.

70197179-0a96-49cb-9ed8-707270ebf556

Ullman v. Oklahoma Highway Patrol

oklahoma

Oklahoma Supreme Court

ULLMAN v. OKLAHOMA HIGHWAY PATROL2023 OK 100Case Number: 121422Decided: 10/17/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. NIKOHL ULLMAN and BREANNA PARSONS, Plaintiffs/Appellants, v. THE OKLAHOMA HIGHWAY PATROL, Defendant/Appellee. APPEAL FROM THE DISTRICT COURT OF LOVE COUNTY Honorable Todd Hicks, Trial Judge ¶0 The plaintiffs were allegedly injured from a collision with an Oklahoma Highway Patrol (OHP) Trooper. Less than three weeks after the accident, the plaintiffs' lawyer sent the OHP a letter asking it to preserve any evidence relating to the incident, and to request some additional information. OHP forwarded the letter to the Oklahoma Office of Management & Enterprise Services (OMES) and OMES unilaterally determined that the request letter was the statutory notice of a governmental tort claim, triggering the time limits within the Oklahoma Governmental Tort Claims Act, 51 O.S. 2021 §§151 et. seq. (the Act). The plaintiffs' lawyer disagreed. Less than one year after the accident, the lawyer sent a notice of governmental tort claim to OMES. Five months later, the plaintiffs filed a lawsuit against the OHP, seeking recovery for their injuries. OHP filed a motion to dismiss, arguing that the letter requesting the preservation of evidence was notice of a governmental tort claim triggering time limits which had already expired by the time the plaintiffs filed their lawsuit. The trial court agreed, and dismissed the cause. We retained it to determine whether the plaintiffs' letter requesting the preservation of evidence constituted the required statutory notice of a governmental tort claim. We hold that it did not. APPEAL PREVIOUSLY RETAINED; TRIAL COURT REVERSED AND CAUSE REMANDED. Aharon Hernandez Manley, Richard Parr, Oklahoma City, Oklahoma, for Plaintiffs/Appellants, Nikohl Ullman and Breanna Parsons. Devan Pederson, Katie A. Wilmes, Assistant Attorney General, State of Oklahoma, Oklahoma City, Oklahoma, for Defendant/Appellee, Oklahoma Highway Patrol. KAUGER, J.: ¶1 The dispostive issue presented is whether a letter sent to the OHP to request that it preserve evidence regarding an accident constituted the required statutory notice of a governmental tort claim. We hold that it did not. FACTS ¶2 On May 30, 2021, the plaintiffs/appellants, Nikohl Ullman and Breanna Parsons (collectively plaintiffs), were traveling on a jet ski on Lake Murray, in Love County, Oklahoma. Allegedly, Trooper Brinson of the defendant/appellee, Oklahoma Highway Patrol (OHP), drove a boat which collided with the plaintiffs, injuring them. ¶3 Eighteen days later, William Kennedy, the plaintiffs' lawyer (Kennedy/lawyer), mailed a letter addressed to the OHP Legal Department dated June 17, 2021. The letter is stamped "RECEIVED JUN 22, 2021 LEGAL." The letter notes "WARNING CONCERNING SPOLIATION OF EVIDENCE & NOTICE OF CLAIMS." It identified the accident of May 30, 2021, between the plaintiffs and an unnamed trooper who apparently did not give any information to the plaintiffs. It states that, due to the nature of their injuries, "[t]his is likely going to lead to litigation." The injuries between the two plaintiffs are described as epilepsy, migraines, broken pelvis and hip, two fractured femurs, and other not fully diagnosed injuries. The letter requests information about insurance coverage, and admonishes OHP to preserve and maintain all potentially relevant records and documents, including videos, security footage, body cam, names of the troopers working on the lake, pictures, incident reports, and email correspondence relating to the accident.1 ¶4 Apparently OHP forwarded the letter to Tara Hubbard (Hubbard/OMES), Liability Advisor for the Risk Management Department, Division of Capital Assets Management of OMES, because she responded to Kennedy by email with letters for each plaintiff, dated June 24, 2021, acknowledging the June 22, 2021, receipt. The response informed Kennedy that OMES had determined his letter served as written notice of a tort claim under the Oklahoma Governmental Tort Claims Act (the Act), 51 O.S. 2021 §§151 et. seq.2 The Act requires that the notice of a claim be submitted within one year of an incident.3 ¶5 Hubbard's OMES response referred to the lawyer's preservation of evidence letter as "the claim of compensation you have tendered, asking for damages under" the Act. It notified Kennedy that the State had 90 days to review and evaluate the claim, and it requested some additional information such as HIPAA forms, medical records and bills, etc, which, according to Kennedy, had not yet been determined. It also stated that: The supplemental information must be received on or before July 08, 2021, the date on which the 90 days will begin. If neither timely submission nor satisfactory explanation is made by this date, the claim will stand denied at the end of the expiration of 90 days from the date the information is due. The right to seek compensation in court may be restricted by the limitations period prescribed by law of one hundred eighty (180) days after the denial of the claim.4 ¶6 On August 12, 2021, Hubbard emailed Kennedy two additional letters stating that both claims were denied.5 The OHP acknowledges that Kennedy then filed "another" notice of governmental tort claim in May of 2022. The record contains two OMES "Bodily Injury Claim" forms which are signed by Kennedy, but are not dated. Presumably, they are copies of OMES forms he alleges that he submitted. They include each claimant's information, information on the incident, who and which state agency was involved, information about the claimant's lawyer, medical provider information, dollar amounts of medical bills, insurance information, and amount requested for each claim. This amount was $175,000.00 by each plaintiff. ¶7 The record also includes a copy of a letter from Kennedy to Hubbard dated June 2, 2022, which was emailed and mailed. It stated: I am in receipt of your letter dated June 1, 2022, stating that the claim was previously denied. Your correspondence from June 1, 2022, was sent by certified mail. How was the letter dated August 12, 2021 delivered? Do you have the certified mail receipt number? That "denial" was premature in that the information contained in our preservation of evidence letter sent on June 17, 2021, was insufficient in terms of a notice letter and was sent to ensure the preservation of evidence. The code requires a "valid notice" letter. The previous letter barely contained a basic description of the facts related to the preservation of evidence notice. Our contentions regarding your employee's negligent actions and why we believe him to be your employee were lacking. More importantly, there were no medical records, no calculation of damages, economic or otherwise, or really, any information whatsoever that would allow a complete examination of the claim which is the intent of requiring a valid notice letter. Our previous communication was intended to preserve evidence and was not a valid claim as the statute required. The June 1, 2022, letter referenced above as a letter from Hubbard is not included in the record. ¶8 On October 3, 2022, the plaintiffs filed a lawsuit against the OHP in the District Court of Love County, Oklahoma. They asserted claims of negligence, and respondeat superior. The plaintiffs alleged that they notified the OHP6 of their claims within the prescribed time limits of the Act. They also alleged that their claims were denied on or about June 1, 2022, thereby qualifying the filing of their lawsuit as timely because it was commenced within 180 days after denial of the claims.7 ¶9 On November 4, 2022, the OHP filed a Motion to Dismiss, attaching records from OMES. The OHP attempted to establish that the plaintiffs failed to file suit within 180 days of August 12, 2021, the alleged denial of the claims by OMES. The OHP attachments included an affidavit of Hubbard, stating that: 1) OMES received tort claims filed by the plaintiffs on June 22, 2021; 2) OMES denied both claims on August 12, 2021; and 3) pursuant to the August 12, 2021, denial, the filing period to file a lawsuit expired on February 9, 2022. ¶10 On November 21, 2022, Kennedy responded to the Motion to Dismiss, stating that the purpose of the June 17, 2021, letter received June 22, 2021, sent only to the OHP, as stated, was to preserve any evidence related to the case. It was not intended to serve as the statutorily required notice of a governmental tort claim to OMES, nor did it in any way attempt to sufficiently fulfill statutory notice requirements.8 ¶11 Kennedy's letter also noted that the accident occurred on May 30, 2021, and there was no possible way, in less than three weeks, the extent of the plaintiffs' injuries could be determined, much less presented as a written claim for loss. Rather, the plaintiffs presented their actual notice of claim on May 27, 2022, when they explained the trooper's alleged negligence, itemized their medical expenses, made a statement as to a wage claim, provided a HIPAA release, and stated a full settlement amount which would be accepted. This notice was filed less than one year after the incident as allowed by the Act.9 ¶12 The trial court held a hearing on the Motion to Dismiss on January 19, 2023. On January 18, 2023, the OHP filed a brief arguing that the lawsuit was untimely because the plaintiffs' lawyer ignored their unilateral determination that his June 22, 2021, letter constituted the statutorily required notice. It also argued that Kennedy's May 2022, claim merely served as a "second" notice of the claim. ¶13 On February 10, 2023, the trial court filed an order memorializing its ruling in the January 19, 2023, hearing. It granted the OHP's Motion to Dismiss. On February 17, 2023, the plaintiffs filed a Motion for a New Trial, again arguing that they never filed a notice of claim with OMES in 2021. Instead, OMES used the preservation of evidence letter sent to the OHP against the plaintiffs to get their lawsuit dismissed. ¶14 After a hearing on the new trial motion on May 26, 2023, the trial court, on June 1, 2023, filed an order outlining its ruling. It determined that: 1) the June 17, 2021, correspondence was a claim contemplated by the Act; 2) the plaintiff had 180 days after denial [August 12, 2021] or until February 8, 2022; 3) an amendment cannot cure the defect; 4) the plaintiff's petition should be dismissed with prejudice. Consequently, the court sustained the OHP's motion to dismiss, denied the plaintiffs' motion for new trial, and dismissed the cause. The plaintiffs appealed on July 3, 2023. The Court retained the appeal on July 18, 2023, and assigned it for an opinion on August 18, 2023. THE LETTER SENT TO THE OHP TO REQUEST THAT IT PRESERVE EVIDENCE REGARDING AN ACCIDENT DID NOT CONSTITUTE THE REQUIRED STATUTORY NOTICE OF A GOVERNMENTAL TORT CLAIM. A. Standard of Review ¶15 Generally, an abuse of discretion standard is used for appellate review of an order denying a motion for new trial.10 An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law or where there is no rational basis in evidence for the ruling.11 An alleged error of law is reviewed on appeal using a de novo standard.12 The alleged error in this proceeding is the trial court's construction or meaning of a governmental tort claim notice. This alleged error is reviewed de novo.13 B. Preservation of Evidence Request. ¶16 Because the disputed issue concerns a preservation of evidence request, the nature and purpose of such requests are instrumental in resolving this cause. A litigant who is on notice that documents and information in its possession are relevant to litigation or potential litigation or are reasonably calculated to lead to the discovery of admissible evidence has a duty to preserve such evidence.14 Failure to preserve evidence, or the destruction or alteration of evidence can adversely affect the ability of a litigant to prove his or her claim.15 So much so, that a few jurisdictions have recognized that a tort action can be brought for such destruction.16 ¶17 The repercussions of the failure to preserve evidence can be severe, not only in the criminal context, but regarding civil actions as well. When an accident occurs, an attorney neglecting to attempt to preserve evidence relevant to his or her client's claim could be subject to a malpractice lawsuit.17 Or if a party intentionally destroys such evidence, sanctions could be imposed against them.18 Sending a letter in an effort to preserve evidence related to a governmental tort claim is not required by the Act. Nevertheless, it is in a plaintiff's best interest that it be done as soon as possible after an incident. ¶18 Preserved evidence might be necessary to not only prove a claim, but to determine whether a plaintiff might even have an action to bring at all. A request to preserve evidence is not in its own right notice that a lawsuit is certain to be filed. In this cause the letter does use a heading which included a warning against spoiling evidence and notice of claims, but the body of the letter clearly identifies it as an attempt by Kennedy to preserve evidence so that he could make determinations about whether tort claims existed and what the extent of damages might be if they did exist.19 C. Notice and The Act. ¶19 This cause is unusual because the plaintiffs argue that the letter was not intended to serve as notice of the claim, nor could it, because it did not meet the statutory requirements for notice. The OHP argues that the letter, even if it wasn't intended to serve as notice, was sufficient and Kennedy had the opportunity to object to it. ¶20 Notice of a claim is critical under the Act because the Act provides for the exclusive liability of a governmental entity for a tort claim.20 The notice requirement is a mandatory prerequisite jurisdictional requirement to filing a claim for tort damages.21 A lawsuit must be based on the claimant presenting written notice of a claim within one year of the date the loss occurs, or the claim is forever barred.22 ¶21 A "claim" means any written demand presented by a claimant, or the claimant's representative, in accordance with the Act to recover money for the governmental entity's act or omission.23 Notice of the claim is designed to protect governmental interests by promoting prompt investigation, repair of dangerous conditions, speedy settlement of meritorious claims, and to give the governmental entity time to meet fiscal liabilities.24 Substantial compliance with the notice provisions of the Act is sufficient when the governmental entity is not prejudiced, and the information provided satisfies the purposes of the statutory notice provisions. Undoubtedly, a letter requesting the preservation of evidence also furthers a prompt investigation, but to qualify as notice of a claim, it should satisfy all of the purposes of the notice provisions and contain more information in accordance with the Act.25 ¶22 What must be included in a claim also depends on what the claimant is seeking. Title 51 O.S. 2021 §156 governs notice of claims. To constitute a notice of claim, the claim shall be in writing, and filed with OMES (or if it is a against a political subdivision of the state, with the office of the clerk of the governing body).26 Here, it was written, but filed with the OHP only as a letter to preserve evidence. It was the OHP that then unilaterally filed it with OMES. It may be filed by certified mail with return receipt, but the statute is otherwise silent as to other forms of filing. The lawyer's preservation-of-evidence letter was mailed. OMES responded mostly through e-mails. ¶23 Although the failure to provide some details of the claim does not necessarily invalidate the entire claim, we have held that notice of claims must be substantially complied with to constitute the required statutory notice.27 Claims must generally include details such as the date, time, place and circumstances of the incident; the identity of the agency involved; the amount of compensation or other relief demanded; the name, address, and telephone number of the claimant or authorized agent; the name, address and telephone number of any agent authorized to settle.28 ¶24 If the claim is for personal injuries, it must include the name and address of all health care providers who treated the claimant and a HIPAA compliant release form.29 If the claim is for loss of earnings, documentation of the loss of earnings must be provided.30 If for loss of personal property, the amount of the property loss should be included as well as the method and documentation to calculate the loss.31 ¶25 While the letter to preserve evidence included some of the required information, we cannot say it substantially complied with the statutory notice requirements. It was clearly not intended to serve as a notice to trigger the time constraints of the Act. It was not addressed or sent to OMES. It stated that a claim might be made, but that evidence must be preserved to make such an evaluation. Most of the information it was seeking was information necessary to determine if a legitimate claim even existed. ¶26 Furthermore, it did not state the name of the OHP officer who allegedly caused the accident. It provided no details about healthcare providers or the injuries sustained, other than to generally list some of them. It was sent so soon after the accident, the extent of the plaintiffs' injuries could not have been fully known. If the plaintiffs had been relying on the submission of the letter to be in substantial compliance with the Act, they would have been substantially unsuccessful. If the plaintiffs' lawyer had relied on the letter as notice of a tort claim, filed the lawsuit within 180 days after the August 2021 OMES "denial," the lawsuit could have been dismissed for ineffective notice of claim. CONCLUSION ¶27 A letter which notifies a potential litigant to preserve evidence serves a purpose of preventing the destruction or alteration of evidence in order for a plaintiff to determine if an actionable claim exists. While such a letter may further a governmental entity's interest in promoting a prompt investigation, it must also contain language and information in accordance with the Act to constitute notice under the Act. The letter in this cause did not include enough language and information to substantially comply with the Act and constitute notice. The trial court is reversed and the cause remanded for further proceedings. APPEAL PREVIOUSLY RETAINED; TRIAL COURT REVERSED AND CAUSE REMANDED. KANE, C.J., ROWE, V.C.J., KAUGER, WINCHESTER, EDMONDSON, COMBS, GURICH, KUEHN, JJ., concur. DARBY, J., not partiticipating. FOOTNOTES 1 A copy of the June 17, 2021, letter is attached. 2 Title 51 O.S. 2021 §156(E-H) sets forth the specific requirements for a writing to constitute notice. It provides: E. The written notice of claim to the state or a political subdivision shall state the date, time, place and circumstances of the claim, the identity of the state agency or agencies involved, the amount of compensation or other relief demanded, the name, address and telephone number of the claimant, the name, address and telephone number of any agent authorized to settle the claim, and any and all other information required to meet the reporting requirements of the Medicare Secondary Payer Mandatory Reporting Provisions in Section 111 of the Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA) through the Centers for Medicare & Medicaid Services (CMS). Failure to state either the date, time, place and circumstances and amount of compensation demanded, or any information requested to comply with the reporting claims to CMS under MMSEA shall not invalidate the notice unless the claimant declines or refuses to furnish such information after demand by the state or political subdivision. The time for giving written notice of claim pursuant to the provisions of this section does not include the time during which the person injured is unable due to incapacitation from the injury to give such notice, not exceeding ninety (90) days of incapacity. F. If the written notice of claim demands relief for personal injuries, the claimant shall provide the name and address of all health care providers who treated the claimant since the date and time of the circumstances claimant set forth in the notice of claim required by subsection E of this section and the date of the notice required by subsection E of this section. For each health care provider required to be identified, the claimant shall provide a HIPPA [sic] compliant authorization for release of health information. Failure to provide the name and address of all health care providers and the HIPPA [sic] compliant authorization required by this subsection shall not invalidate the notice required by subsection E of this section unless the claimant declines or refuses to furnish such information after demanded by the state or political subdivision. G. If the written notice of claim demands relief for loss of earnings, the claimant shall provide the documentation of the loss of earnings since the date and time of the circumstances claimant set forth in the notice of claim required by subsection E of this section and the date of the notice required by subsection E of this section. Failure to provide the documentation required by this subsection shall not invalidate the notice required by subsection E of this section unless claimant declines or refuses to furnish such information after demanded by the state or political subdivision. H. If the written notice of claim demands relief for losses of real or personal property, the claimant shall provide the amount of the property loss claimed, the method used to calculate the amount of loss, documentation relied upon in determining the amount of loss, and proof of the claimant's ownership of property. Failure to provide the documentation required by this subsection shall not invalidate the notice required by subsection E of this section unless claimant declines or refuses to furnish such information after demanded by the state or political subdivision. 3 Title 51 O.S. 2021 §156(A-D) only requires notice to be given within one year of the date of loss. It provides in pertinent part: A. Any person having a claim against the state or a political subdivision within the scope of Section 151 et seq. of this title shall present a claim to the state or political subdivision for any appropriate relief including the award of money damages. B. Except as provided in subsection H of this section, and not withstanding any other provision of law, claims against the state or a political subdivision are to be presented within one (1) year of the date the loss occurs. A claim against the state or a political subdivision shall be forever barred unless notice thereof is presented within one (1) year after the loss occurs. C. A claim against the state shall be in writing and filed with the Office of the Risk Management Administrator of the Office of Management and Enterprise Services who shall immediately notify the Attorney General and the agency concerned and conduct a diligent investigation of the validity of the claim within the time specified for approval or denial of claims by Section 157 of this title. A claim may be filed by certified mail with return receipt requested. A claim which is mailed shall be considered filed upon receipt by the Office of the Risk Management Administrator. D. A claim against a political subdivision shall be in writing and filed with the office of the clerk of the governing body. 4 A copy of the letters are attached to the opinion. Hubbard emailed two nearly identical letters to the plaintiffs' lawyer on June 24, 2021. One letter regards the claim of one of the plaintiffs, and the other letter concerns the claim of the other plaintiff. Title 51 O.S. 2021 §157(A-B) provides: A. A person may not initiate a suit against the state or a political subdivision unless the claim has been denied in whole or in part. A claim is deemed denied if the state or political subdivision fails to approve the claim in its entirety within ninety (90) days, unless the state or political subdivision has denied the claim or reached a settlement with the claimant before the expiration of that period. If the state or a political subdivision approves or denies the claim in ninety (90) days or less, the state or political subdivision shall give notice within five (5) days of such action to the claimant at the address listed in the claim. If the state or political subdivision fails to give the notice required by this subsection, the period for commencement of an action in subsection B of this section shall not begin until the expiration of the ninety-day period for approval. The claimant and the state or political subdivision may continue attempts to settle a claim, however, settlement negotiations do not extend the date of denial unless agreed to in writing by the claimant and the state or political subdivision. B. No action for any cause arising under this act, Section 151 et seq. of this title, shall be maintained unless valid notice has been given and the action is commenced within one hundred eighty (180) days after denial of the claim as set forth in this section. The claimant and the state or political subdivision may agree in writing to extend the time to commence an action for the purpose of continuing to attempt settlement of the claim except no such extension shall be for longer than two (2) years from the date of the loss. 5 A copy of the August 12, 2021, letters are attached. 6 They also alleged that they notified the Oklahoma State Bureau of Investigation (OSBI) of their tort claims as well. 7 Title 51 O.S. 2021 §157, see note 1, supra. 8 Title 51 O.S. 2021 §156(E-H), see note 2, supra. 9 Title 51 O.S. 2021 §156(A-D), see note 3, supra. 10 Garnett v. Government Employees Ins. Co., 2008 OK 43, ¶29, 186 P.3d 935; Grisham v. City of Oklahoma City, 2017 OK 69, ¶4, 404 P.3d 843; Matter of K.S., 2017 OK 16, ¶7, 393 P.3d 715. 11 Fent v. Oklahoma Natural Gas Co., 2001 OK 35, ¶ 12, 27 P.3d 477; Grisham v. City of Oklahoma City, see note 10, supra; Gowens v. Barstow, 2015 OK 85, ¶11, 363 P.3d 644. 12 Grisham v. City of Oklahoma City, see note 10, supra; Christian v. Gray, 2003 OK 10, ¶43, 65 P.3d 591. 13 Grisham v. City of Oklahoma City, see note 10, supra. 14 Barnett v. Simmons, 2008 OK 100, ¶21, 197 P.3d 12. 15 Barnett v. Simmons, see note 14, supra; Patel v. OMH Medical Center, Inc., 1999 OK 33, ¶46, 987 P.2d 1185. 16 Patel v. OMH Medical Center, Inc., see note 15, supra. 17 See, e.g., State ex rel. Oklahoma Bar Association v. Glapion, 2023 OK 29, ¶9, _ P.3d __, Client sued and recovered from an attorney who, among other things, neglected to attempt to preserve evidence related to an automobile accident. 18 See, Barnett v. Simmons, see note 14, supra. 19 See, the June 17, 2021, letter attached. 20 Title 51 O.S. 2021 §153(B) provides: B. The liability of the state or political subdivision under The Governmental Tort Claims Act shall be exclusive and shall constitute the extent of tort liability of the state, a political subdivision or employee arising from common law, statute, the Oklahoma Constitution, or otherwise. If a court of competent jurisdiction finds tort liability on the part of the state or a political subdivision of the state based on a provision of the Oklahoma Constitution or state law other than The Governmental Tort Claims Act, the limits of liability provided for in The Governmental Tort Claims Act shall apply. 21 Hall v. Geo Group, Inc., 2014 OK 22, ¶1, 324 P.3d 399; Harmon v. Cradduck, 2012 OK 80, ¶28, 286 P.3d 643. 22 Watkins v. Central State Griffin Memorial Hospital, 2016 OK 71, ¶22, 377 P.3d 124; Pellegrino v. State ex rel. Cameron Univ., 2003 OK 2,¶6, 63 P.3d 533; Hathaway v. State ex rel. Medical Research & Technical Authority, 2002 OK 53, ¶8, 49 P.3d 1082. Title 51 O.S. 2021 §156(B), see note 3, supra. 23 Title 51 O.S. 2021 §152(4) provides: 4. "Claim" means any written demand presented by a claimant or the claimant's authorized representative in accordance with this act to recover money from the state or political subdivision as compensation for an act or omission of a political subdivision or the state or an employee; Section 152 has been amended seven times since 2018, but subsection 4 has remained unchanged. 24 Pellegrino v. State ex rel. Cameron Univ., see note 22, supra at ¶17; Duncan v. City of Nichols Hills, 1996 OK 16, ¶14, 913 P.2d 1303. 25 See, Minie v. Hudson, 1997 OK 26, ¶6, 934 P.2d 1082. 26 Title 51 O.S. 2021 §156(C), see note 3, supra. 27 Examples of previous substantial compliance cases are fact specific, but include: I.T.K. v. Mounds Public Schools, 2019 OK 59, ¶51, 451 P.2d 125 [Notice of claim sent to school superintendent satisfied notice filing requirement with office of board of education, but unilateral insurance adjuster letter seeking settlement was insufficient to trigger tolling provisions.]; Grisham v. City of Oklahoma City, see note 10, supra at ¶23 [Notice of property damage without stating any other loss was not sufficient notice for any other loss, but notice using claim form was sufficient to serve as notice for personal injuries for the same transaction or occurrence as property damage claim.]; Minie v. Hudson, see note 25, supra at ¶8 [Verbal notice of claim given to city was insufficient.]. Minie includes a list additional substantial compliance cases, most of which have been superceded in part by statutory changes, but nevertheless substantial compliance is still applicable to determine whether the statutory requirements have been met. 28 Title 51 O.S. 2021 §156(E), see note 2, supra. 29 Title 51 O.S. 2021 §156(F), see note 2, supra. 30 Title 51 O.S. 2021 §156(G), see note 2, supra. 31 Title 51 O.S. 2021 §156(H), see note 2, supra.

93b67dfd-6f9d-41e6-ae56-ed062f234843

Bird v. Pruett's Food, Inc.

oklahoma

Oklahoma Supreme Court

BIRD v. PRUETT'S FOOD2023 OK 92Case Number: 120434Decided: 09/26/2023IN THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. STEVEN J. BIRD, Plaintiff/Appellant, v. PRUETT'S FOOD, INC., Defendant/Appellee. APPEAL FROM THE DISTRICT COURT OF ATOKA COUNTY HONORABLE PAULA INGE, DISTRICT JUDGE ¶0 Plaintiff, an independent contractor hired to install a new checkout lane at Defendant's store, was injured after falling off a ladder Defendant had supplied to aid Plaintiff in completing the work. Plaintiff initiated a negligence action, seeking damages from his injuries and lost wages. Plaintiff presented his case at trial, after which Defendant demurred to Plaintiff's evidence. The trial court sustained the demurrer. Plaintiff appealed, and we retained the matter. We hold that Plaintiff failed to establish that Defendant owed him a duty of care. MATTER PREVIOUSLY RETAINED FOR DISPOSITION; JUDGMENT OF THE TRIAL COURT AFFIRMED. Rex Travis, Travis Law Office, Oklahoma City, Oklahoma, for Plaintiff/Appellant. J. Derrick Teague and Todd A. Murray, Jennings Teague P.C., Oklahoma City, Oklahoma, for Defendant/Appellee. ROWE, V.C.J.: BACKGROUND ¶1 Steven J. Bird ("Bird"), Plaintiff/Appellant, was an employee of Truno Retail Technology Solutions ("Truno"), a company that services grocery store computer registers. Pruett's Food Inc. ("Pruett's"), Defendant/Appellee, hired Truno to install equipment for an additional checkout lane at its store location in Atoka, Oklahoma. Bird was assigned the installation job and was told to complete the installation as soon as possible. Truno shipped the necessary installation equipment to Atoka, but when Bird arrived at the store, he determined a cable would need to be run through the ceiling to connect the register to the servicing computer. ¶2 Truno did not supply Bird with a ladder, which he needed to run the cable through the ceiling, so Bird requested to borrow a ladder from Pruett's. Pruett's provided Bird their only ladder to use for the job. At the outset, Bird noticed that the ladder was missing the rubber feet at the bottom of the ladder that kept the ladder stable while in use. Bird mentioned the missing feet to one of Pruett's employees, but he was informed that the store did not have any other ladders and that the store's employees frequently used the ladder despite the missing feet. ¶3 Despite his concern, Bird continued with the work, climbing up and down the ladder approximately two or three times. During the first two climbs, Bird testified the ladder shifted under his weight, which caused him additional concern about the ladder's stability. Bird testified that on his third climb, the ladder shifted and slid out from under him. He fell and landed on his left heel, fracturing it. ¶4 Bird filed a negligence action in Atoka County District Court against Pruett's for his bodily injury damages and lost wages. Bird claimed Pruett's was negligent in providing him a defective ladder which resulted in his bodily injuries. Pruett's answered the Petition and filed a Motion for Summary Judgment contending Bird cannot establish the elements of his negligence claim. The district court denied Pruett's Motion for Summary Judgment and set a date for jury trial. ¶5 Bird presented his case before the jury and Pruett's Food demurred to Bird's evidence. After accepting all evidence as true and reasonable inferences favorable to Bird, the district court sustained Pruett's demurrer. Bird appealed, and we retained the matter. STANDARD OF REVIEW ¶6 The standard of review on an order sustaining a demurrer is similar to that for summary judgment. Harder v. F.C. Clinton, Inc., 1997 OK 137, ¶ 6, 948 P.2d 298, 301-02. Orders granting summary judgment are subject to de novo review. Tiger v. Verdigris Valley Elec. Coop., 2016 OK 74, ¶ 13, 410 P.3d 1007, 1011. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. In determining whether a plaintiff's evidence is sufficient to withstand a demurrer, "the trial court must consider as true all evidence favorable to the plaintiff together with all reasonable inferences to be drawn from it, and disregard all conflicting evidence favorable to the movant." Harder, 1997 OK 137, ¶ 6, 948 P.2d at 302. A demurrer should not be affirmed on appeal unless the record is devoid of proof tending to show a right to recover. Jackson v. Jones, 1995 OK 131, ¶ 4, 907 P.2d 1067, 1071. In other words, a demurrer should be overruled if the plaintiff has made a prima facie case. Id. We will not, however, disturb a trial court's order sustaining a demurrer unless there is competent evidence to support the material elements of the plaintiff's cause of action. Id. DISCUSSION ¶7 The material elements of a negligence claim are: (1) a duty owed by the defendant to protect the plaintiff from injury; (2) a failure to perform that duty; and (3) injuries to the plaintiff which are proximately caused by the defendant's failure to exercise the duty of care. Berman v. Laboratory Corp. of America, 2011 OK 106, ¶ 16, 268 P.3d 68, 72. ¶8 On appeal, Bird argues that Pruett's owed him a duty of care, as an employee of an independent contractor hired to perform work on its premises, to provide a safe place and safe equipment. In support of his position, Bird cites to Davis v. Whitsett, 1967 OK 190, 435 P.2d 592, and Healing Waters, Inc. v. McCracken, 1960 OK 49, 350 P.2d 295. ¶9 Davis involved a wrongful death action brought by the widow of a welder who died when the oil tank on which he was working exploded. Davis, 1967 OK 190, ¶ 1, 435 P.2d at 594. The defendants, who owned the tank and employed it in their oil and gas operations on the property, had drained the tank of oil prior to the decedent's arrival but had not taken steps to rid the tank of residual explosive gases that had accumulated while the oil was being stored. Id. ¶ 7, 435 P.2d at 595. The plaintiff presented uncontroverted testimony at trial that it was standard in the industry to steam out a storage tank after it had been drained in order to make it safe for welding. Id. ¶¶ 15-20, 435 P.2d at 596-97. In affirming the jury's award to the plaintiff, we held that, "An owner of premises who has engaged an independent contractor to do work on his premises owes to such invitee the duty to keep the premises reasonably safe for the performance of the work." Id. ¶ 5, 435 P.2d at 595. We also noted that although an invitee assumes all normal, ordinary, and obvious risks inherent to the premises, the owner has a duty to warn the invitee of any hidden dangers or unsafe conditions, of which the owner is or should be aware. Id. ¶10 In Healing Waters, the defendant, a religious corporation in the process of organizing a series of "tent revival" meetings, sought volunteers to help in the dismantling and moving of a temporary sanitation building. Healing Waters, 1960 OK 49, ¶¶ 1-5, 350 P.2d at 296. The plaintiff, one such volunteer, was removing roof panels when he stepped on a rafter that had been prematurely loosened. Id. ¶ 7, 350 P.2d at 296. The rafter rolled, causing the plaintiff to fall and injure his back. Id. In affirming the jury's award to the plaintiff, we explained that although an employee may have assumed known and obvious risks inherent to the nature of their work, in instances where the hazards of the work place evolve and progress, the employer has an ongoing duty to make the work place as safe as possible. Id. ¶ 13, 350 P.2d at 297. ¶11 Pruett's argues that neither Davis nor Healing Waters is controlling here because this matter does not present an issue of premises liability. Specifically, Pruett's notes that Bird's injuries were not the result of a dangerous condition at the store. Rather, his injury resulted from the use of a chattel (i.e., the ladder that Pruett's provided him). Pruett's further distinguishes Healing Waters by noting that the work in question here did not become progressively more dangerous and that the plaintiff in that case was a volunteer, rather than an independent contractor. ¶12 Pruett's also argues that the general duty that a property owner owes to independent contractors to provide them with a safe place to work is qualified. In Hatley v. Mobil Pipe Line Co., 1973 OK 42, 512 P.2d 182, we noted that the general duty is qualified by the rule that one who hires an independent contractor and does not interfere with or direct the work has no obligation to protect the contractor from hazards that are incidental to the work the contractor was hired to perform. Pruett's further argues that we applied this rule, finding that no duty existed, in a case with circumstances similar to this one, Marshall v. Hale-Halsell Co., 1997 OK 3, 932 P.2d 1117. ¶13 In Marshall, the plaintiff was hired as a "lumper"1 for an independent truck driver making a delivery to the defendant. Id. ¶ 3, 932 P.2d at 1118. When the plaintiff arrived at the defendant's property, he asked the defendant's employees for a pallet lift to use in unloading the cargo. Id. The defendant's employees provided the plaintiff with a motorized pallet lift. Id. The plaintiff mentioned that he had never used a motorized pallet lift and preferred a manual one, but the motorized pallet lift was the only one defendant had available. Id. The plaintiff managed to unload approximately fifteen pallets with the motorized lift before accidentally running over his own foot while attempting to reverse. Id. ¶ 4, 932 P.2d at 1118. We affirmed summary judgment in favor of the defendant citing the qualified duty we adopted in Hatley and finding that the danger of running over one's foot to be incident to the work the plaintiff was hired to perform. Id. ¶¶ 8-12, 932 P.2d at 1119-20. We also noted that the outcome was consistent with our holding in Grover v. Superior Welding, Inc., 1995 OK 14, 893 P.2d 500. ¶14 In Grover, the plaintiff injured her arm when her glove got caught in a drill press. Id. ¶ 2, 893 P.2d at 501-02. The defendant, parent company of the plaintiff's employer, had given the drill press to plaintiff's employer. Id. We affirmed summary judgment in favor of the defendant, finding that the dangers inherent to the drill press were known to the plaintiff, and thus, the defendant was under no duty to further warn the plaintiff of said dangers. Id. ¶ 11, 893 P.2d at 504. ¶15 Whether the defendant owed the plaintiff a duty of care is question of law for the court to resolve. Lowery v. Echostar Satellite Corp., 2007 OK 38, ¶ 12, 160 P.3d 959, 964. In light of the foregoing precedent, we find that Pruett's owed no duty to either warn Bird of the risks associated with using the ladder or to provide him with a different ladder. ¶16 At the outset, we agree with Pruett's contention that the duty owed by property owners to independent contractors hired to perform work on their land is subject to the exception identified in Hatley and Marshall. Thus, the operative question here is whether the exception applies. In answering that question, we must determine (1) whether Pruett's interfered with or directed Bird's work at the store, and (2) whether the hazards which ultimately resulted in his injury were inherent to the work he was hired to perform. As to the first question, Bird does not allege that Pruett's or any of its employees interfered with or directed his work. Bird admitted in his responses to Pruett's interrogatories that none of the store's employees were assisting him with the work. Bird also testified at trial that he knew how to complete the work without any assistance from Pruett's employees, that he decided the order of tasks necessary to complete the work, and that he chose what tools to use in completing the work. ¶17 As to the second question, we find that the hazards which resulted in Bird's injuries were inherent to the work he was hired to perform. Bird acknowledges that it was necessary to run cable through the ceiling in order to set up the additional checkout lane. As a result, utilizing a ladder or lift to reach the ceiling tiles was a necessary part of the job. The risk of falling is an inherent hazard when using a ladder. The safety instructions on the ladder in question specifically advised users to, among other things, to have someone hold the ladder if possible, to always face the ladder and maintain a firm grip on it, and to avoid sitting or standing on top of the ladder. The safety instructions also advised users to avoid overreaching and excessive pushing or pulling while on the ladder because it might cause the user to lose their balance or tip the ladder. All of these warnings are explicitly directed at minimizing the inherent risk of falling while using the ladder. ¶18 Since Pruett's did not attempt to interfere with or direct Bird's work, and the hazards which resulted in his injury were inherent to the work he was hired to perform, we find that the exception to the general duty a property owner owes to independent contractors identified in Marshall and Hatley applies here. Accordingly, Pruett's had no obligation to protect Bird from hazards incidental to the work he was hired to perform. ¶19 Bird argues that reliance on cases like Marshall and Grover is misplaced because the ladder furnished to him was defective, whereas the pallet lift and the drill press in Marshall and Grover were not. However, we find this distinction immaterial. Our jurisprudence holds that one who supplies chattel to another to use is subject to liability for physical harm caused by the use of the chattel in the manner for which it is supplied, if the following conditions are satisfied: (1) the supplier knows or has reason to know that the chattel is likely to be dangerous for the use for which it is supplied; (2) the supplier has no reason to believe that the user will realize its dangerous condition; and (3) the supplier fails to exercise reasonable care to inform the user of its dangerous condition.2 Here, the second condition is not satisfied because Bird clearly recognized the allegedly defective dangerous conditions of the ladder and even expressed his concern about them to Pruett's employees. Thus, although the ladder may have been dangerous for the use for which it was supplied, Pruett's cannot be subject to liability for the physical harm Bird suffered. ¶20 Based on the foregoing, we find that Bird has failed to establish that Pruett's had a duty to protect Bird from hazards incidental to the work he was hired to perform. Bird's negligence action thus fails as a matter of law, and we need not address his remaining propositions on appeal. CONCLUSION ¶21 While a property owner who has engaged an independent contractor to do work on the premises has a duty to the independent contractor to keep the premises reasonably safe, that duty is subject to an exception when the property owner does not interfere with or direct the contractor's work and the hazards which result in injury to the contractor are incidental to the work. Pruett's did not interfere with or direct Bird's work at the store, and the hazard of falling off the ladder was incident to the work Bird was hired to perform. Pruett's is not liable for harm that resulted from the ladder it provided to Bird because Bird was aware of the allegedly dangerous condition of the ladder. The trial court's order sustaining Pruett's demurrer is hereby affirmed. MATTER PREVIOUSLY RETAINED FOR DISPOSITION; JUDGMENT OF THE TRIAL COURT AFFIRMED. ALL JUSTICES CONCUR FOOTNOTES 1 A "lumper" is an individual who contracts with truck drivers to off-load their cargo at their destinations. Marshall v. Hale-Halsell Co., 1997 OK 3, ¶ 3, 932 P.2d 1117, 1118. 2 See Grover, 1995 OK 14, ¶ 8, 893 P.2d at 503.

05b6af8f-dd85-4bbc-b1bc-f05b999a22f0

Oklahoma Dept. of Corrections v. Byrd

oklahoma

Oklahoma Supreme Court

OKLAHOMA DEPT. OF CORRECTIONS v. BYRD2023 OK 97Case Number: 119908 (cons. w/ 119907)Decided: 10/10/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. OKLAHOMA DEPARTMENT OF CORRECTIONS, Petitioner/Appellant, v. CINDY BYRD, in her official capacity as State Auditor and Inspector of the State of Oklahoma, and BOARD OF COUNTY COMMISSIONERS OF THE COUNTY OF TULSA, OKLAHOMA, and TULSA COUNTY CRIMINAL JUSTICE AUTHORITY, Respondents/Appellees. ON CERTIORARI TO COURT OF CIVIL APPEALS, DIVISION III HONORABLE DON ANDREWS, TRIAL JUDGE ¶0 On request of Tulsa County, the Oklahoma State Auditor and Inspector calculated the jail's "actual daily cost" to house Department of Corrections inmates pursuant to 57 O.S. § 38. The State Auditor's "actual daily cost" calculation included the jail's consumable costs and fixed costs. The Oklahoma Department of Corrections filed suit against the State Auditor and Inspector and Tulsa County, arguing "actual daily cost" is limited to consumable costs and excludes fixed costs. The district court found it lacked subject matter jurisdiction to hear the case but found the State Auditor's calculation was rational. The Court of Civil Appeals found the district court had limited jurisdiction to hear the dispute and determined "actual daily cost" includes both consumable costs and fixed costs. The Court of Civil Appeals further determined the Oklahoma Administrative Procedure Act, and the doctrine of issue preclusion did not bar judicial review. We hold on certiorari review that issue preclusion is not applicable, the separation of powers clause does not bar this Court from interpreting the meaning of "actual daily cost," and "actual daily cost" includes any cost directly attributable to housing a DOC inmate. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; REMANDED TO THE TRIAL COURT FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Craig A. Fitzgerald, Timothy J. Sullivan, Justin A. Lollman, GABLEGOTWALS, Tulsa, Oklahoma for Petitioner/Appellant. V. Glenn Coffee, Lexie P. Norwood, and Denise Lawson, GLENN COFFEE & ASSOCIATES, PLLC, Oklahoma City, Oklahoma for Respondent/Appellee Cindy Byrd, in her official capacity as State Auditor and Inspector of the State of Oklahoma. David B. Donchin, DURBIN, LARIMORE & BIALICK, Oklahoma City, Oklahoma for Respondent/Appellee Cindy Byrd in her official capacity as State Auditor and Inspector of the State of Oklahoma. Douglas A. Wilson, Assistant District Attorney, Tulsa County District Attorney's Office, Tulsa, Oklahoma for Respondent/Appellee Board of County Commissioners of the County of Tulsa. Stephen A. Kunzweiler, Tulsa County District Attorney, Tulsa County District Attorney's Office, Tulsa, Oklahoma for Respondent/Appellee Board of County Commissioners of the County of Tulsa. Sharon K. Weaver, RIGGS, ABNEY, NEAL, TURPEN, ORBISON & LEWIS, P.C., Tulsa, Oklahoma for Respondents/Appellees Board of County Commissioners of the County of Tulsa and Tulsa County Criminal Justice Authority. OPINION ROWE, V.C.J.: ¶1 Oklahoma counties are required to house state prison inmates in certain instances.1 In turn, Oklahoma law requires the state to reimburse counties Twenty-seven Dollars ($27.00) ("$27") per day per state inmate for the cost of housing, unless the "actual daily cost" exceeds $27. The primary issue before us concerns the meaning of "actual daily cost" as provided in 57 O.S. 2017, § 38.2 BACKGROUND ¶2 In 2011, the Honorable Josh Brecheen asked the Attorney General whether "Oklahoma counties [are] required to accept payment from the Department of Corrections at the rate set out in Section 38 of Title 57 of the laws of Oklahoma?"3 The Attorney General opined that "the Department of Corrections must pay to counties an amount not exceeding a per diem of twenty-seven dollars ($27.00), unless that per diem amount is not sufficient to fully reimburse a county's cost of housing a prisoner. In such instances, the requirement in Section 1 of Article XXI of the Oklahoma Constitution that the state support penal institutions would require the state to fully reimburse the county."4 The Attorney General did not opine on whether $27 was sufficient to cover the cost of housing a DOC inmate, finding the question was beyond the scope of an Attorney General opinion.5 ¶3 In light of the Attorney General's opinion, the Board of County Commissioners of Bryan County challenged § 38's constitutionality in district court. The district court concluded that when a county's cost exceeds $27, the county "is entitled to reimbursement from the State of Oklahoma in an amount sufficient to fully reimburse the costs of housing incurred by the county for such inmate without being limited by the cap limit provided by 57 O.S. § 38."6 The DOC appealed the district court's order and the Court of Civil Appeals ("COCA") affirmed. See Bd. of Cnty. Comm'rs of the Cnty. of Bryan v. Oklahoma Dep't of Corrections, 2015 OK CIV APP 86, 362 P.3d 241.7 ¶4 In light of the Attorney General's 2011 opinion and Board of County Commissioners of the County of Bryan v. Oklahoma Department of Corrections, Tulsa County retained MGT of America, Inc., a nationwide professional services firm specializing in calculating jail costs and rates, to conduct a rate study of the Tulsa County jail. MGT determined Tulsa County's "actual daily cost" for housing, caring for, and feeding inmates was $55.81 per inmate per day.8 Tulsa County sought reimbursement in the amount of $55.81 but DOC rejected the proposed amount. As a result, the Board of County Commissioners of the County of Tulsa and Tulsa County Criminal Justice Authority (collectively referred hereinafter as "Tulsa County") filed suit against DOC seeking declaratory judgment on the reimbursement Tulsa County claimed DOC owed for housing state inmates.9 ¶5 During the pendency of the suit, the Legislature amended 57 O.S. 2015, § 38, effective November 1, 2017, which remains in effect today. The amendment provided a procedure for when a county and DOC disagree on the "actual daily cost" of housing a DOC inmate: The Department of Corrections shall reimburse any county which is required to retain an inmate pursuant to subsection D E of Section 37 of this title in an amount not to exceed Twenty-seven Dollars ($27.00) per day for each inmate during such period of retention, unless the actual daily cost as determined by the Department of Corrections Daily Rate as defined in this section, exceeds Twenty-seven Dollars ($27.00). If the actual daily cost as determined by the Department of Corrections Daily Rate exceeds Twenty-seven Dollars ($27.00), the county shall notify the Department of Corrections of the actual daily cost no later than September 30. If the county's actual daily cost is accepted by the Department that shall be the reimbursement rate for the county beginning the next fiscal year. If the Department rejects the county's actual daily cost application, then the actual daily cost reimbursement shall be determined by the State Auditor and shall be imposed beginning the next fiscal year. 2017 Okla. Sess. Law Serv. Ch. 260 (H.B. 1483) (omitted text in strikethrough, new text in underline). ¶6 Despite § 38's amendment, Tulsa County did not seek a reimbursement determination from the State Auditor and Inspector ("State Auditor") and chose to maintain its claims against DOC in district court. DOC moved for Partial Summary Judgment asking the court to find "that DOC does not have to reimburse Tulsa County for the fixed costs of operating the Tulsa County jail"10 pursuant to 57 O.S. 2017, § 38, arguing its reimbursement obligation was limited to "actual, incremental costs"11 attributable to the presence of a DOC inmate. ¶7 Judge Susan Stallings granted DOC's Motion for Partial Summary Judgment, ruling that Tulsa County's "reimbursable costs cannot include [] fixed costs, . . . but are instead limited to consumables such as the actual costs of feeding, housing, clothing, providing medical treatment, attributable to the presence of Department of Corrections inmates in the Tulsa County jail in excess of the $27 statutory per diem rate, as proven at trial."12 The order was certified as an appealable interlocutory order pursuant to 12 O.S. § 952(3). We denied Tulsa County's request for certiorari review of Judge Stallings' ruling. ¶8 Following the denial of certiorari review, Tulsa County sent a letter to the State Auditor, requesting that she determine the "actual daily cost" of a DOC inmate pursuant to § 38. After the State Auditor agreed to determine the "actual daily cost" reimbursement rate for a DOC inmate, Tulsa County voluntarily dismissed its case against DOC. ¶9 After learning the State Auditor agreed to determine the "actual daily cost," representatives from DOC requested a meeting with the State Auditor to discuss Tulsa County's request for a rate determination. DOC representatives noted that Tulsa County's request was procedurally improper and requested that if the State Auditor determines a reimbursement rate, that she do so according to Judge Stallings' Order. The State Auditor notified Tulsa County that the "actual daily cost" to house a DOC inmate was $63.42.13 THE PRESENT LAWSUIT ¶10 On July 28, 2020, DOC filed a Petition for Review, or in the Alternative, Declaratory Judgment or Writ of Mandamus against the State Auditor and Tulsa County in Oklahoma County District Court. The DOC asked the district court to (1) set aside the State Auditor's reimbursement rate determination; (2) remand the matter to the State Auditor with instruction to follow requirements for an individual proceeding under the Oklahoma Administrative Procedure Act ("OAPA") and determine the actual daily cost reimbursement rate pursuant to 57 O.S. § 38 by excluding fixed cost; (3) declare that actual daily costs subject to reimbursement under 57 O.S. § 38 shall be limited to consumables such as the actual cost of feeding, housing, clothing and providing medical treatment attributable to the presence of DOC inmates and shall not include fixed costs; or (4) issue a writ of mandamus directing the State Auditor to determine a reimbursement rate pursuant to 57 O.S. § 38 that includes only Tulsa County's actual cost of consumables attributable to DOC inmates. ¶11 Tulsa County filed a Motion to Dismiss which the district court denied. Following the denial, DOC, the State Auditor, and Tulsa County filed cross-motions for Summary Judgment. DOC argued (1) the State Auditor failed to apply the correct meaning of "actual daily cost" pursuant to 57 O.S. § 38 in calculating Tulsa County's reimbursement rate; (2) the State Auditor failed to comply with the OAPA; and (3) Tulsa County should be precluded from relitigating whether its reimbursable rate under 57 O.S. § 38 includes fixed costs of operating the Tulsa County Jail. In the State Auditor's Motion for Summary Judgment, she argued that granting DOC's motion would violate the separation of powers clause and the district court lacks authority to issue a declaratory judgment or writ of mandamus in favor of DOC. Tulsa County argued the State Auditor properly exercised her authority and discretion as her determination was neither erroneous nor arbitrary; the State Auditor is not bound by a district court case to which she was not a party and that involved a pre-amendment version of § 38; and the State Auditor's determination is not subject to the OAPA. ¶12 The district court granted Tulsa County and the State Auditor's Motion for Summary Judgment, finding the court lacked subject matter jurisdiction "in adjudicating any claim that would require a district court to decide the 'actual daily cost reimbursement.'"14 In addition, despite finding the district court lacked subject matter jurisdiction, the court concluded the State Auditor's method to determine the "actual daily cost" was rational. The DOC filed its Petition in Error, and the case was assigned to COCA. ¶13 COCA reversed and remanded the district's ruling holding that "the § 38 rate determination is a justiciable matter granting the court with subject matter jurisdiction."15 COCA determined the district court has limited jurisdiction to hear the dispute because the State Auditor was acting in a quasi-judicial function when she determined the "actual daily cost" pursuant to 57 O.S. § 38. In addition, COCA determined that neither the OAPA nor issue preclusion applied in this case. Lastly, COCA determined "the legislature intended the phrase 'actual daily costs' to include fixed costs"16 and remanded the case to the district court with instruction to apply its interpretation of "actual daily cost" and determine whether the State Auditor abused her discretion when she determined the reimbursement rate of $63.42. ¶14 Both DOC and the State Auditor sought certiorari review of COCA's opinion. The DOC contends COCA's determination that "actual daily cost" includes fixed costs is incorrect and presents a question of statewide importance. The State Auditor contends COCA erred finding the district court had jurisdiction over the dispute because the State Auditor was exercising her discretionary executive power granted to her by the Legislature and interference by the courts would violate the separation of powers. In addition, the State Auditor argues COCA erred in remanding the case because the district court already made the determination that the State Auditor's calculation of the "actual daily cost" was rational. In turn, Tulsa County contends certiorari review is unwarranted because the requests for review go beyond the merits of the appeal. STANDARD OF REVIEW ¶15 Summary judgment settles only questions of law. Lowery v. Echostar Satellite Corp., 2007 OK 38, ¶ 11, 160 P.3d 959, 963--64. The standard of review for questions of law is de novo. Id. Where a controversy is resolved by summary judgment, the appellate courts review the entire summary judgment record independently and without deference to a lower court. Id. Summary judgment will be affirmed only if the appellate court determines that there is no dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Id. Under de novo review, we have plenary, independent and nondeferential authority to determine whether the district court erred in its legal ruling. Fanning v. Brown, 2004 OK 7, ¶ 8, 85 P.3d 841, 845. "Statutory construction also presents a question of law. Questions of law are reviewed by a de novo standard." Id. ANALYSIS A. Issue Preclusion Is Not Applicable. ¶16 On appeal, DOC contends Judge Stallings' order in CV-2017-684 has preclusive effect over this case. In Board of County Commissioners of the County of Tulsa v. Oklahoma Department of Corrections, No. CV-2017-684 (District Court of Oklahoma County, March 31, 2017) (certiorari denied), Judge Stallings' Order for Summary Judgment held that "actual daily cost" is limited to consumables and excludes fixed costs of the county jail. Tulsa County and the State Auditor contend the doctrine of issue preclusion does not apply because the State Auditor was not a party to the previous case (CV-2017-684). DOC argues it is irrelevant whether the State Auditor was a party to the previous case because the issue preclusive effect of Judge Stallings' interlocutory order applies only to Tulsa County, who along with DOC, are the only real parties in interest here. ¶17 Issue preclusion "is activated when an ultimate issue has been determined by a valid and final judgment--that question cannot be relitigated by [the same] parties, or their privies, to the prior adjudication in any future lawsuit." Carris v. John R. Thomas & Assocs., P.C., 1995 OK 33, ¶ 9, 896 P.2d 522, 527. "Once a court has decided an issue of fact or law necessary to its judgment, the same parties or their privies may not relitigate that issue in a suit brought upon a different claim." Oklahoma Dep't of Pub. Safety v. McCrady, 2007 OK 39, ¶ 7, 176 P.3d 1194, 1199. The doctrine may not be invoked if the party against whom the earlier decision is interposed did not have a "full and fair opportunity" to litigate the critical issue in the previous case. Id. "Issue preclusion requires, at a minimum, that the party against whom it is being asserted was either a party to or a privy of a party to the prior action . . ." State ex rel. Tal v. City of Okla. City, 2002 OK 97, ¶ 20, 61 P.3d 234, 245. The State Auditor was not a party to the previous case and did not have a full and fair opportunity to litigate the issue of the meaning of "actual daily cost." Accordingly, Judge Stallings' order does not have preclusive effect over this case.17 B. The Separation of Powers Clause Does Not Bar This Court from Interpreting the Meaning of "Actual Daily Cost." ¶18 The State Auditor and Tulsa County claim district courts do not have subject matter jurisdiction over this matter because exercising jurisdiction would violate the separation of powers clause. More specifically, the State Auditor and Tulsa County contend the Legislature vested the State Auditor with discretionary executive authority to determine the "actual daily cost" of a DOC inmate, thereby prohibiting the judiciary from interfering with the State Auditor's executive power. Thus, the question is whether the separation of powers clause prevents us from determining the meaning of "actual daily cost" as provided in 57 O.S. § 38. ¶19 Subject matter jurisdiction is the "power to deal with the general subject involved in the action" or the nature of the cause of action and the relief sought. Dutton v. City of Midwest City, 2015 OK 51, ¶ 16, 353 P.3d 532, 539. We have explained that subject matter jurisdiction of a court is invoked by pleadings filed by a party with a court which demonstrates that the court has power to proceed in a case of the character presented, or power to grant the relief sought. Id. In addition to other courts, the Oklahoma Constitution specifically vests district courts with judicial power.18 A district court's judicial power, however, is limited in scope by the Oklahoma Constitution's article providing for the separation of powers. Article 4, § 1 of the Oklahoma Constitution provides: The Powers of the government of the State of Oklahoma shall be divided into three separate departments: The Legislative, Executive, and Judicial; and except as provided in this Constitution, the Legislative, Executive and Judicial departments of government shall be Separate and distinct, and neither shall exercise the powers Properly belonging to either of the others. Okla. Const. art. 4, § 1 (emphasis added). The doctrine of separation of powers mandates that "the whole power of one department shall not be exercised by the same hands which possess the whole power of either of the other departments; and that no one department ought to possess directly or indirectly an overruling influence over the others." State ex rel. York v. Turpen, 1984 OK 26, ¶ 9, 681 P.2d 763, 767. For example, the doctrine of separation of powers requires that "in the absence of express authority of law so to do, the judiciary will not interfere with the exercise of executive powers." Bynum v. Strain, 1923 OK 596, ¶ 11, 218 P. 883. ¶20 The Oklahoma Constitution makes the State Auditor an executive officer of the state.19 Moreover, the Oklahoma Constitution outlines the State Auditor's powers and duties, such that she "shall perform such other duties and have such other powers as may be prescribed by law."20 The Legislature directs the State Auditor to determine the "actual daily cost" of a DOC inmate in a county jail when the proposed amount is in dispute. The Legislature, however, failed to define the method or manner in which the State Auditor shall determine the "actual daily cost." We have said that "by failing to define the limits of [the State Auditor's] duties and to prescribe the manner of [her] performance, [she] is left to [her] own judgment in the discharge of [her] duties imposed." Clark v. Carter, 1922 OK 106, 209 P. 932, 938. ¶21 The State Auditor contends that because 57 O.S. § 38 confers on her a discretionary executive duty to determine the "actual daily cost," district courts lack subject matter jurisdiction in adjudicating what method should be used to calculate the rate.21 The State Auditor argues that "the courts will interfere with the State Auditor's decisions and actions only if [she] acts capriciously or arbitrarily, or if [she] exceeds [her] authority or abuses [her] discretion." Independent School Dist. No. 1 of Oklahoma Cty. v. Scott, 2000 OK CIV APP 121, ¶ 23, 15 P.3d 1244, 1251. DOC counters it is not asking this Court to displace the State Auditor by calculating the "actual daily cost" reimbursement rate--that role remains with the State Auditor. Rather, DOC is requesting we provide guidance on the meaning of § 38 so that the State Auditor may perform her executive duties in accordance with the law. ¶22 Asking us to interpret the meaning of a statute does not create a separation of powers conflict. As the Judiciary, we are the "ultimate authority on the interpretation of the laws of this State." Robinson v. Fairview Fellowship Home For Senior Citizens, Inc., 2016 OK 42, ¶ 13, 371 P.3d 477, 483. The State Auditor's contention that statutory interpretation is unnecessary due to her discretion in calculating the actual daily cost is misguided. The State Auditor's statutory duties under § 38 and the discretion she has in performing those duties is predicated upon an interpretation of "actual daily cost." ¶23 In Bynum v. Strain, the removed bank commissioner sought an enjoinment of his successor, claiming the Governor's removal of him and the appointment of his successor was without authority. Bynum, 1923 OK 596, 218 P. 883. The question before this Court was whether, under our constitutional system of government, the judiciary can limit or interfere with the Chief Executive in the exercise of powers pertaining purely to the functioning of the executive department. Id. ¶ 10, 218 P. at 885. We held "in the absence of express authority of law so to do [sic], the courts will not cross the confines of judicial province and interfere with the exercise of executive powers nor with the executive's sense of his duties and responsibilities. Id. ¶ 11. However, we also recognized that if there is a question of statutory interpretation, "it then becomes the duty and proper province of the judiciary to interpret such law and declare its meaning [and] the executive will then be guided by the court's interpretation of the law and will execute the court's mandates." Id. ¶ 12. ¶24 In this instance, DOC seeks our determination of the meaning of "actual daily cost" in § 38. Our role as the Judiciary rests in statutory interpretation; therefore, interpreting the meaning of "actual daily cost" falls exclusively within our purview. The State Auditor was assigned the duty to calculate the "actual daily cost" of housing a DOC inmate in a county jail--a role that falls exclusively within the purview of the State Auditor's statutory duties. By interpreting the meaning of § 38, we are not interfering with the State Auditor's performance of her executive duty. Without our interpretation, the State Auditor effectively confers meaning to § 38 by the method she chooses which reaches into the realm of a judicial function--a task beyond the authority of the State Auditor. Ascertaining the meaning of § 38 will provide guidance to the State Auditor in her role of calculating the "actual daily cost" of housing a DOC inmate. Accordingly, the separation of powers clause does not bar our review. C. "Actual Daily Cost" Includes Any Cost That Is Directly Attributable to Housing a DOC Inmate. ¶25 The heart of this dispute revolves around the meaning of "actual daily cost," as provided in § 38. Title 57 O.S. § 38 in pertinent part provides: The Department of Corrections shall reimburse any county which is required to retain an inmate pursuant to subsection E of Section 37 of this title in an amount not to exceed Twenty-seven Dollars ($27.00) per day for each inmate during such period of retention, unless the actual daily cost as determined by the Department of Corrections Daily Rate as defined in this section, exceeds Twenty-seven Dollars ($27.00). If the actual daily cost as determined by the Department of Corrections Daily Rate exceeds Twenty-seven Dollars ($27.00), the county shall notify the Department of Corrections of the actual daily cost no later than September 30. If the county's actual daily cost is accepted by the Department that shall be the reimbursement rate for the county beginning the next fiscal year. If the Department rejects the county's actual daily cost application, then the actual daily cost reimbursement shall be determined by the State Auditor and shall be imposed beginning the next fiscal year. The Department shall distribute the reimbursement on a monthly basis upon receipt and approval of a billing statement from the county. The county shall use the reimbursement to defray expenses of equipping and maintaining the jail and payment of personnel. 57 O.S. § 38 (emphasis added).22 ¶26 The DOC contends "actual daily cost" is limited to consumable costs attributable to the presence of a DOC inmate and excludes fixed costs. Tulsa County contends "actual daily cost" includes both consumable costs and fixed costs because the cost to house a DOC inmate(s) is proportionate to the total cost of housing all inmates. The Legislature did not define "actual daily cost," thus, we are confronted with a question of statutory interpretation. ¶27 "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by the statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. "It is presumed that the Legislature has expressed its intent in a statute's language and that it intended what it so expressed." Id. "Intent is ascertained from the whole act in light of its general purpose and objective considering relevant provisions together to give full force and effect to each." Keating v. Edmondson, 2001 OK 110, ¶ 8, 37 P.3d 882, 886. "Only where legislative intent cannot be ascertained from the language of a statute, as in cases of ambiguity, are rules of statutory interpretation employed." Odom, ¶ 18, 415 P.3d at 528. ¶28 Because the statute does not define "Department of Corrections Daily Rate"23 we are left with examining what costs are included in "actual daily cost." The operative word is "actual." "Actual" is a descriptive adjective, meaning "existing in fact or reality,"24 as contrasted with what is intended, expected, or believed. By inserting "actual" before "daily cost," the Legislature modified the meaning of "daily cost" to include costs existing in fact or reality that are directly attributable to the cost of housing a DOC inmate,25 as opposed to costs incurred by a county regardless of whether it houses a DOC inmate. ¶29 Since the inception of this suit, the parties have borrowed the terms "consumable costs" and "fixed costs" from Judge Stallings' order in case No. CV-2017-684. In her order, Judge Stallings defined "consumable costs" as "the actual costs of feeding, housing, clothing, providing medical treatment, attributable to the presence of Department of Corrections inmates in the Tulsa County jail"26 and defined "fixed costs" as "expenses incurred regardless of the presence of Department of Corrections inmates in the Tulsa County jail."27 ¶30 It is undisputed that the "actual daily cost" of housing a DOC inmate includes "consumable costs" such as food, clothes, and medical care. It is disputed whether "fixed costs," which the parties refer to as the jail's operating expenses, are included within "actual daily cost." Operating expenses are not necessarily dependent on the number of prisoners, as some operating expenses are inevitably incurred regardless of whether a DOC inmate is housed in a county jail. However, there may be instances when a jail's operating expenses increase due to housing a DOC inmate. For example, if a county jail employs a set number of jailers in the regular operation of its jail, that cost is not directly attributable to housing a DOC inmate. If, however, a county jail employs an additional jailer and demonstrates the hiring of the additional jailer is directly attributable to housing a DOC inmate, such cost would exist in fact and be included in the "actual daily cost." We find that "actual daily cost" includes any cost directly attributable to the housing of a DOC inmate, including consumable costs and any portion of the county jail's operating expenses that would not otherwise have been incurred but for the presence of a DOC inmate. ¶31 Our finding that "actual daily cost" encompasses costs directly attributable to housing a DOC inmate is further supported by the manifest purpose of § 38, which is directed at reimbursing county jails. The word "reimburse" means "to pay back, to make restoration, to repay that expended."28 According to § 38, a county that incurs additional costs for housing a DOC inmate--costs not otherwise incurred--will be "reimbursed"29 by the state. The reimbursement DOC is mandated to pay a county is solely predicated upon the presence of a DOC inmate.30 ¶32 The State Auditor's methodology in calculating "actual daily cost" fails to account for these important distinctions. Specifically, the State Auditor employed an "operating cost-based calculation," which does not result in a determination of "actual daily cost" as defined above. Without rehashing her method in detail, the State Auditor assigned a pro rata share of the jail's operating expenses to DOC, without regard for whether those costs would have been incurred in the absence of DOC inmates.31 Based on the foregoing, we find that the State Auditor's approach to calculating "actual daily cost" is plainly contrary to the text of 57 O.S. § 38.32 ¶33 Reading the statute in its entirety, § 38 requires DOC to reimburse a county for the "actual daily cost" of housing a DOC inmate. "Actual daily cost" includes any cost incurred by a county shown to be directly attributable to housing a DOC inmate. The term "actual daily cost" encompasses both consumable costs (e.g., food and clothing) as well as those additional costs incurred as a direct result of housing a DOC inmate. Costs not directly attributable to the housing a DOC inmate are not reimbursable by DOC.33 CONCLUSION ¶34 Oklahoma law requires DOC to reimburse a county the cost of housing a DOC inmate. Title 57 O.S. 2017, § 38 sets the reimbursement rate at $27. In the event the "actual daily cost" of housing a DOC inmate exceeds $27, and DOC disputes the county's proposed "actual daily cost" amount, the State Auditor will calculate the "actual daily cost." We hold "actual daily cost" includes both consumable costs as well as those additional costs that are directly attributable to housing a DOC inmate. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; REMANDED TO THE TRIAL COURT FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Kane, C.J., Rowe, V.C.J., Winchester, Gurich, and Kuehn (by separate writing), JJ., concur. Kauger, Edmondson, Combs (by separate writing), and Darby, JJ., concur in part; dissent in part. FOOTNOTES 1 The common jails in the several counties in the charge of the respective sheriffs, shall be used as prisons: 1. For the detention of persons charged with offenses, and duly committed for trial. 2. For the detention of persons who may be duly committed, to secure their attendance as witnesses on the trial of any criminal cause. 3. For the confinement of persons pursuant to a sentence, upon a conviction for an offense and of all other persons duly committed for any cause authorized by law. 4. For the confinement of persons who may be sentenced to imprisonment in the state prison, until they shall be removed thereto. 57 O.S. § 42. 2 The Department of Corrections shall reimburse any county which is required to retain an inmate pursuant to subsection E of Section 37 of this title in an amount not to exceed Twenty-seven Dollars ($27.00) per day for each inmate during such period of retention, unless the actual daily cost as determined by the Department of Corrections Daily Rate as defined in this section, exceeds Twenty-seven Dollars ($27.00). If the actual daily cost as determined by the Department of Corrections Daily Rate exceeds Twenty-seven Dollars ($27.00), the county shall notify the Department of Corrections of the actual daily cost no later than September 30. If the county's actual daily cost is accepted by the Department that shall be the reimbursement rate for the county beginning the next fiscal year. If the Department rejects the county's actual daily cost application, then the actual daily cost reimbursement shall be determined by the State Auditor and shall be imposed beginning the next fiscal year. The Department shall distribute the reimbursement on a monthly basis upon receipt and approval of a billing statement from the county. The county shall use the reimbursement to defray expenses of equipping and maintaining the jail and payment of personnel. The provisions in this act shall be implemented by the Department to allow sufficient time for application to FY-2019. The Department of Corrections shall reimburse the county for the emergency medical care for physical injury or illness of the inmate retained under this act if the injury or illness is directly related to the incarceration and the county is required by law to provide such care for inmates in the jail. The Department shall not pay fees for medical care in excess of the rates established for Medicaid providers. The state shall not be liable for medical charges in excess of the Medicaid scheduled rate. The Director may accept any inmate required to have extended medical care upon application of the county. 57 O.S.2017, § 38. 3 2011 OK AG 8, ¶0. 4 2011 OK AG 8, ¶ 27. 5 Id. 6 Bd. Of Cnty. Comm'rs of the Cnty. of Bryan v. Oklahoma Dep't of Corrections, No. CV-2012-1272 (District Court of Oklahoma County, Sept. 25, 2013). 7 Like the Attorney General's opinion, neither the district court nor COCA provided an opinion on whether $27 was a sufficient amount to reimburse a county for the costs of housing DOC inmates. 8 The $55.81 rate factored in costs for items such as employee salary, medical care, booking, employee benefits, building depreciation, utilities, transport, administration, operating supplies, and professional and technical services. 9 Bd. Of Cnty. Comm'rs of the Cnty. Of Tulsa v. Oklahoma Dep't of Corrections, No. CV-2017-684 (District Court of Oklahoma County, March 31, 2017). 10 Department of Corrections Motion for Summary Judgment and Brief in Support, 25. Case No. CV-2017-684. 11 DOC Motion for Summary Judgment, 11. 12 Petition for Review, Or in the Alternative, Declaratory Judgment or Writ of Mandamus, Ex. D. District Court Order, Case No. CV-2017-684. 13 To reach this number, the State Auditor asked Tulsa County to complete the U.S. Marshals Service Form USM-243 Cost Sheet for Detention Services. This form is used to determine the per diem rate to house federal prisoners in local facilities and allows fixed costs like personnel and depreciation to be used in the calculation. Rather than attempting to paraphrase her method, we have included an excerpt from the State Auditor's Letter to Tulsa County wherein she explains her calculations: SAI has made a reasonable determination as to the daily, per inmate, cost to house an individual in the county jail by dividing the average annual number of prisoners by the total annual operating costs of the jail and dividing again by 365 days. The daily average number of inmates incarcerated at the jail in FY19 was 1,398. The facility's annual operating costs totals $32,351,882.42. 32,351,882.42 ÷ 1,398 ÷ 365 = $63.40 At any given time, DOC housed an average of 77 prisoners at the county jail in FY19 which was equal to 5.51 percent of the total jail population. SAI took the average number of DOC prisoners housed at the county jail, multiplied this percentage by the total annual operating costs of the jail, divided this figure by 77 prisoners, then again by 365 days, to arrive at a figure very close to the more practical calculation noted above. $32,351,882.42 X 0.0551 = $1,726,028.26 ÷ 77 = 22,415.95 ÷ 365 = $63.43 The average of both calculations would suggest a daily reimbursement rate to house a prisoner in the county jail of $63.42. 14 District Court Journal Entry of Judgment, 3 (dated September 8, 2021). 15 COCA Opinion, ¶ 1. 16 COCA Opinion, ¶ 26. 17 Regardless of whether issue preclusion bars judicial review, Judge Stallings' order was interlocutory. An interlocutory order is an order which is not "final." DLB Energy Corp. v. Oklahoma Corp. Comm'n, 1991 OK 5, ¶ 7, 805 P.2d 657, 660. "The issuance of an interlocutory order leaves the parties in court to try the issues on the merits." Id. Because Judge Stallings' order was interlocutory, issues remained to be tried by the parties, making her order not final for purposes of issue preclusion. 18 § 1. Courts in which judicial power vested. The judicial power of this State shall be vested in the Senate, sitting as a Court of Impeachment, a Supreme Court, the Court of Criminal Appeals, the Court on the Judiciary, the State Industrial Court, the Court of Bank Review, the Court of Tax Review, and such intermediate appellate courts as may be provided by statute, District Courts, and such Boards, Agencies and Commissions created by the Constitution or established by statute as exercise adjudicative authority or render decisions in individual proceedings. Provided that the Court of Criminal Appeals, the State Industrial Court, the Court of Bank Review and the Court of Tax Review and such Boards, Agencies and Commissions as have been established by statute shall continue in effect, subject to the power of the Legislature to change or abolish said Courts, Boards, Agencies, or Commissions. Municipal Courts in cities or incorporated towns shall continue in effect and shall be subject to creation, abolition or alteration by the Legislature by general laws, but shall be limited in jurisdiction to criminal and traffic proceedings arising out of infractions of the provisions of ordinances of cities and towns or of duly adopted regulations authorized by such ordinances. Okla. Const. art 7, § 1. 19 § 1. Executive officers enumerated - Offices and records - Duties. A. The Executive authority of the state shall be vested in a Governor, Lieutenant Governor, Secretary of State, State Auditor and Inspector, Attorney General, State Treasurer, Superintendent of Public Instruction, Commissioner of Labor, Commissioner of Insurance and other officers provided by law and this Constitution, each of whom shall keep his office and public records, books and papers at the seat of government, and shall perform such duties as may be designated in this Constitution or prescribed by law. Okla. Const. art. 6, § 1 (A). 20 Okla. Const. art. 6, § 19. 21 In Board of County Commissioners of County of Seminole v. Oklahoma Department of Corrections, 2021 OK CIV APP 33, 499 P.3d 33, COCA determined the district court lacked subject matter jurisdiction to adjudicate any claim that would require it to decide the "actual daily cost reimbursement" referenced in 57 O.S. § 38, finding that determination rests exclusively with the State Auditor. We note, parenthetically, that DOC's prevailing argument in Seminole wherein it argued that the State Auditor had exclusive jurisdiction over disputes between counties and DOC for reimbursement claims contradicts its argument here that "asking the judiciary to interpret a statute does not create a separation of powers conflict with the Auditor's § 38 duties." The separation of powers clause does not bar this Court from exercising jurisdiction to determine the meaning of a statute where the interpretation of a statute directly relates to how an officer of the executive branch must perform her statutory duty. Accordingly, our finding today overturns Seminole. 22 We note that "the actual daily cost as determined by the Department of Corrections Daily Rate as defined in this section," is not defined in this section. 23 57 O.S. § 38 fails to define "The Department of Corrections Daily Rate" and fails to define "actual daily cost." 24 "Actual", Merriam-Webster, https://www.merriam-webster.com/dictionary/actual (last visited Sept. 19, 2023). 25 Section 37(F) provides that "the Department will be responsible for the cost of housing [an] inmate in the county jail. . . ." 57 O.S. § 37(F) (emphasis added). Section 38 requires DOC to reimburse any county which is required to "retain an inmate." 26 Judge Stallings' Order, 2 (dated August 29, 2019). 27 Id., 2-3. 28 "Reimburse", Black's Law Dictionary (5th ed. 1979). 29 57 O.S. § 38. 30 A state inmate may be housed in county jails when all correctional facilities reach maximum capacity; for temporary detention for purposes of trial; or for confinement pursuant to a sentence. 57 O.S. § 37; 57 O.S. § 42. The longevity of a state inmate's stay in a county jail may vary but DOC is "responsible for the cost of housing the inmate in the county jail . . . from the date the judgment and sentence was ordered by the court until the date of transfer of the inmate from the county jail." 57 O.S. § 37(F). 31 In concluding her letter to Tulsa County, the State Auditor states that she "does not offer an opinion as to whether the total operating cost-derived method for determining the daily reimbursement rate is more representative of the County's actual cost than a compromise for an incremental rate above the statutorily mandated maximum of $27 per day, per prisoner." 32 Because the State Auditor's reimbursement rate calculation is contrary to § 38 we need not address whether the process in which she made that calculation was in violation of the Oklahoma Administrative Procedure Act. 33 Our finding comports with Okla. Const. art. 21, § 1, which we have interpreted to mean county funds may not be used to support state institutions. See State ex rel. Dept. Human Serv. v. Malibie, 1981 OK 18, ¶ 27, 630 P.2d 310, 317 ("Article 21, Section 1, require[s] that State funds, not county funds, be expended to support and maintain state institutions"). KUEHN, J., SPECIALLY CONCURRING: ¶1 I agree with the Majority that issue preclusion does not bar the courts from hearing this case. ¶2 I also agree with the Majority that the separation of powers clause does not prevent this Court from interpreting the meaning of "actual daily cost." Section 38 does not give the State Auditor authority to define "actual daily cost"1, and the statute's language defining that term is ambiguous. When a question of statutory interpretation arises, the judiciary is the proper branch of government to interpret such law and determine its meaning to help guide the executive branch in its application. Bynum v. Strain, 1923 OK 596, ¶ 12, 218 P. 883, 885. We need not defer to the Auditor in defining the phrase "actual daily cost", because defining statutory terms is not among the Auditor's duties. ¶3 It is important to understand that in interpreting the ambiguous statutory term, this Court's interpretation is not intended to direct the State Auditor as to how she should do her job--in fact, it should not. Instead, our interpretation of the definition of "actual daily cost" should do no more than broadly guide the State Auditor, and counties, when determining what should be included in their calculations. The State Auditor is an executive of the state, and under Title 57 Section 38 may, to resolve a dispute between the DOC and a county, determine the amount of actual daily cost reimbursement due the county. ¶4 I write separately to address the Majority's third assertion that "actual daily cost" should include any cost that is "directly attributable" to housing a DOC inmate. It is undisputed that consumable costs should be included in the calculation of the "actual daily cost" of housing a DOC inmate. I agree with the Majority that sometimes a jail's fixed, operating expenses can increase as a result of housing a DOC inmate. The Majority deliberately sets out a general definition which includes both consumable costs and the possibility of fixed costs. But, in my view, neither this Court nor district courts are equipped to determine actual costs for any county that are directly attributable to the housing of a DOC inmate. As the statute provides, those calculations are better left to counties, the State Auditor, and their accountants. FOOTNOTES 1 The Legislature can, and should, define this term if the Court's interpretation is not acceptable. The Legislature can also directly mandate that the State Auditor should define "daily rate" for Department of Corrections and the counties. This would be a perfect example of the correct workings of the separation of powers. COMBS, J., with whom KAUGER, EDMONDSON, and DARBY, JJ., join, concur in part, dissent in part: ¶1 I concur in the majority opinion that we are asked to interpret the term "actual daily cost" and this Court has subject matter jurisdiction over this matter. However, I dissent to the majority opinion's interpretation. The Legislature granted the State Auditor with discretion to determine the "actual daily cost reimbursement." See 57 O.S. § 38 ("the actual daily cost reimbursement shall be determined by the State Auditor . . . ."). I agree that determining an actual daily cost reimbursement is within the authority of the State Auditor; however, interpretation of a term which lacks a history of administrative interpretation nor is defined by the State Auditor or statute is a justiciable matter. Our review, therefore, should be to interpret the term "actual daily cost" and determine whether there has been an abuse of discretion by the State Auditor. ¶2 The majority opinion limits "actual daily cost" to only the cost "directly" attributable to housing a DOC inmate "as opposed to costs incurred by a county regardless of whether it houses a DOC inmate." It provides that such costs would include an "additional jailer [that] is directly attributable to housing a DOC inmate." It finds any cost not directly attributable to housing an inmate is not reimbursable. However, 57 O.S. § 38 provides "the reimbursement [is] to defray expenses of equipping and maintaining the jail and payment of personnel." It does not say, as the majority opinion asserts, that it is for payment of personnel that have been hired to take care of a specific inmate. In order to "house" an inmate you must have a house, a functioning facility, staffed and equipped to house an inmate on any given day or days. Further, under § 38, the "actual daily cost" as determined by the State Auditor will be imposed at the beginning of the "next fiscal year." This is more indication that the Legislature was not referring to additional costs attributable to a specific inmate but would include the pro rata costs attributable to "equipping and maintaining the jail and payment of personnel" in general. The issues in this case are far-reaching; however, simply put, the Department of Corrections should pay for the incarceration of their inmates in Oklahoma's county jails. There are 77 counties with different needs and expenses related to housing inmates. The majority opinion's definition of "actual daily cost" would create an impractical and potentially fiscally impossible remedy. The State Auditor used the U.S. Marshals Service Form USM-243 which assists in calculating a per diem rate to house federal prisoners in local facilities. The form uses criteria for determining a rate which includes fixed costs like personnel and depreciation. The State Auditor used this form as well as data like the average number of inmates and the total cost to operate a jail to determine a per diem "actual daily cost." Her methods were a realistic, practical and affordable solution to the problem and clearly come within the language of 57 O.S. § 38. Besides interpreting a statutory term, the type of review appropriate here should be whether the State Auditor abused her discretion. I would find that, under 57 O.S. § 38, the State Auditor's method for calculating "actual daily cost" was not an abuse of discretion.

a8d5048b-35b7-414d-a764-e7dc0d7ac3ac

Leo v. Oklahoma Water Resources Board

oklahoma

Oklahoma Supreme Court

LEO v. OKLAHOMA WATER RESOURCES BOARD2023 OK 96Case Number: 118892Decided: 10/03/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. DEBBIE LEO DBA MILLER LAKE RETREAT LLC, LARINDA McCLELLAN, LOUISE REDMAN TRUST, WALTER MYRL REDMAN and KENNETH ROBERTS, Petitioners/Appellants/Cross-Appellees,andDALE JACKSON and JUSTIN JACKSON, Petitioners,v.OKLAHOMA WATER RESOURCES BOARD, Respondent/Appellee,andTHE CITY OF OKLAHOMA CITY, OKLAHOMA, Respondent/Appellee/Cross- Appellant. ON APPEAL FROM THE DISTRICT COURT OF PUSHMATAHA COUNTY,STATE OF OKLAHOMAHONORABLE MICHAEL D. DeBERRY, DISTRICT JUDGE ¶0 Debbie Leo d/b/a Miller Lake Retreat, LLC, Larinda McClellan, Louise Redman Trust, Walter Myrl Redman, and Kenneth Roberts (collectively, "Petitioners") appeal the district court's order affirming the Oklahoma Water Resources Board's (the OWRB) final order granting a permit to The City of Oklahoma City (the City) to divert stream water from the Kiamichi River in Pushmataha County, Oklahoma. The City filed a cross-appeal of the district court's order denying its motion to dismiss Petitioners' petition for judicial review for lack of subject matter jurisdiction. City contends that Petitioners' failure to name the City as a respondent in their petition for judicial review of the OWRB's order was a fatal, jurisdictional flaw under the Oklahoma Administrative Procedures Act, (OAPA). We hold that 75 O.S.2011, § 318(B)(2) requires that the agency (here, the OWRB) be named as a respondent in the caption of the petition for review for the district court to acquire jurisdiction to review a final agency order. However, Section 318(B)(2) of the OAPA does not require that the City be named as a respondent in the petition. Therefore, the district court's order finding it had jurisdiction to review the final agency order is affirmed. We further hold the district court properly applied the Four Points of Law in O.A.C. § 785:20-5-4, including using the OWRB's calculation of available stream water and evaluation of beneficial use, which was based on substantial evidence in the record, with no findings of prejudicial error. Therefore, the district court's order affirming the OWRB's order is affirmed. ORDER OF THE DISTRICT COURT IS AFFIRMED. Kevin R. Kemper, Oklahoma City, Oklahoma, for Appellants/Cross-Appellees. Sara D. Gibson, Oklahoma City, Oklahoma, for Appellee Oklahoma Water Resources Board. Brian M. Nazarenus, Stacy L. Brownhill, Nazarenus Stack & Wombacher LLC, Greenwood Village, Colorado, for Appellee/Cross-Appellant the City of Oklahoma City. KANE, C.J.: ¶1 The threshold issue on appeal is whether Petitioners/Appellants/Cross-Appellees Debbie Leo d/b/a Miller Lake Retreat, LLC, Larinda McClellan, Louise Redman Trust, Walter Myrl Redman, and Kenneth Roberts's (collectively, "Petitioners") failure to name Respondent/Appellee/Cross-Appellant The City of Oklahoma City as a respondent in their Petition for Judicial Review of the Respondent/Appellee Oklahoma Water Resources Board's (OWRB) order was fatal to their appeal under the Oklahoma Administrative Procedures Act (OAPA), 75 O.S.2011, § 318(B)(2). We hold that 75 O.S.2011, § 318(B)(2) requires that the agency (here, the OWRB) be named as a respondent in the caption of the petition for review for the district court to acquire jurisdiction to review a final agency order. However, Section 318(B)(2) of the OAPA does not require that the City be named as a respondent in the petition. Therefore, the district court acquired jurisdiction to review the OWRB's final order. As to the merits of this appeal, we hold: (1) this Court's decision in Purcell v. Parker, 2020 OK 83, 475 P.3d 834, is distinguishable from this case; (2) granting the City's stream water permit does not constitute an unconstitutional taking of Petitioners' water rights; (3) the district court properly denied Petitioners' requests to conduct limited discovery and testimony on administrative appeal pursuant to 75 O.S.2011, § 321; and (4) the district court properly applied the Four Points of Law in O.A.C. § 785:20-5-4, including the OWRB's calculation of available stream water and evaluation of beneficial use. FACTS AND PROCEDURAL HISTORY ¶2 The City applied for a permit to divert stream water from the Kiamichi River in Pushmataha County, Oklahoma. Eighty-five individuals and entities, including Petitioners, protested the City's stream water permit application. After a hearing, the OWRB issued an Order granting the City's stream water permit on October 10, 2017. Petitioners1 filed a Petition for Judicial Review in the District Court of Pushmataha County on November 8, 2017. The Petition for Judicial Review named only the agency, OWRB, as a respondent. The Petition for Review did not name the City as a respondent. ¶3 The City entered a special entry of appearance on November 16, 2017 and moved to dismiss the Petition for Judicial Review for lack of subject matter jurisdiction. The City argued that Petitioners had failed to join the City and other necessary parties, as required by the OAPA, 75 O.S.2011, § 318(B)(2). ¶4 Petitioners then filed an Amended Petition for Judicial Review on November 27, 2017, adding the City as an additional respondent in the caption of the case. ¶5 On December 4, 2017, the OWRB also filed a motion to dismiss the Petition for Judicial Review and the subsequent Amended Petition for Judicial Review for failing to meet the requirements of the OAPA, 75 O.S.2011, § 318(B)(2), and for failure to join all parties to the administrative proceeding below. Likewise, on December 20, 2017, the City moved to dismiss the Amended Petition for Judicial Review for lack of subject matter jurisdiction and because it was filed outside the thirty-day period for appealing a final agency order. See 75 O.S., § 318(B)(2). ¶6 The district court denied the City's and the OWRB's motions to dismiss on May 7, 2018, concluding that even though Petitioners' failure to name the City as a respondent in the style or caption of the petition for review was a fatal, jurisdictional flaw, pursuant to Davis v. Oklahoma Employment Security Commission, 2010 OK 45, 238 P.3d 922, the City and the OWRB would suffer no prejudice if Petitioners were allowed to amend their Petition for Judicial Review to include the City as a respondent. ¶7 On June 1, 2020, the District Court affirmed the OWRB's October 10, 2017 order granting the City the stream water permit. Petitioners appealed the June 1, 2020, order. The City filed a cross-appeal of the May 7, 2018, order denying its motion to dismiss for lack of subject matter jurisdiction. The Court retained this appeal on the OWRB's motion. I. JURISDICTION OF THE DISTRICT COURT ¶8 We will first address the jurisdictional issue raised in the City's cross-appeal. The City argues Petitioners' failure to name the City as a respondent in their Petition for Judicial Review was fatal to their appeal under the OAPA, 75 O.S.2011, § 318(B)(2). STANDARD OF REVIEW ¶9 Whether the district court has acquired jurisdiction in a proceeding for judicial review of an administrative order is a question of law. See Edmondson v. Siegfried Ins. Agency, Inc., 1978 OK 45, ¶ 4, 577 P.2d 72, 73. This appeal requires us to interpret 75 O.S.2011, § 318. Statutory interpretation also presents a question of law. See State ex rel. Okla. State Dep't of Health v. Robertson, 2006 OK 99, ¶ 5, 152 P.3d 875, 877. The district court's legal rulings are subject to this Court's plenary, independent, and non-deferential reexamination under the de novo standard of review. Id. ANALYSIS Properly naming the respondent, pursuant to the OAPA, 75 O.S.2011,§ 318(B)(2), is jurisdictional. ¶10 Judicial review of the OWRB's June 1, 2020, final order is available under 75 O.S.2011, § 318. The OAPA provides, in pertinent part: [P]roceedings for review shall be instituted by filing a petition, in the district court of the county in which the party seeking review resides or at the option of such party where the property interest affected is situated, naming as respondents only the agency, such other party or parties in the administrative proceeding as may be named by the petitioner or as otherwise may be allowed by law, within thirty (30) days after the appellant is notified of the final agency order as provided in Section 312 of this title. 75 O.S.2011, § 318(B)(2). This Court has long said that the statutory, procedural requirements of the OAPA are mandatory and must be complied with before the district court can acquire jurisdiction to review a final agency order. See Conoco, Inc. v. State Dep't of Health, 1982 OK 94, ¶¶ 9-12, 651 P.2d 125, 127-29 (applying 75 O.S.1981, § 318(1)); see also State ex rel. Okla. Employ. Sec. Comm'n v. Emergency Physicians, Inc., 1981 OK 82, ¶ 9, 631 P.2d 743, 745 (same for judicial review under the Oklahoma Employment Security Act (OESA), 40 O.S.1971, § 224(g)). It is well established that compliance with the time limits for filing a petition for judicial review of a final agency order is jurisdictional. See Conoco, 1982 OK 94, ¶ 11, 651 P.2d at 128. ¶11 This Court is now asked to determine whether properly naming the respondent(s) in the petition for judicial review, pursuant to 75 O.S.2011, § 318(B)(2), is also jurisdictional. We hold the respondent naming requirements for judicial review under the OAPA, 75 O.S.2011, § 318(B)(2), are jurisdictional.2 Like the statutory time limit for filing the petition for review, the statutory provisions setting out what parties must be named in the petition for review are mandatory, procedural requirements that must be complied with before the district court can acquire jurisdiction to review a final agency order. The OAPA, 75 O.S.2011, § 318(B)(2), requires that the agency be named as a respondent in the caption of the petition for judicial review. ¶12 The question then becomes: what parties must be named as respondents to comply with 75 O.S.2011, § 318(B)(2)? ¶13 Section 318(B)(2) clearly and unambiguously requires that the agency be named as a respondent in the petition for review. The language "filing a petition . . . naming as respondents only the agency," denotes the agency issuing the final order being appealed must be named as a respondent in the petition for judicial review.3 We hold that 75 O.S.2011, § 318(B)(2) requires that the agency be named as a respondent in the caption of the petition for review for the district court to acquire jurisdiction to review a final agency order. Petitioners named the OWRB as a respondent in the caption of the timely filed Petition for Judicial Review, satisfying this requirement. The OAPA, 75 O.S.2011, § 318(B)(2) does not require that any other party of record in the administrative proceeding be named as a respondent in the petition for judicial review. ¶14 Next, we turn to the interpretation of the words "naming as respondents . . . such other party or parties in the administrative proceeding as may be named by the petitioner." 75 O.S., § 318(B)(2). The City argues that all parties of record in the administrative proceeding must be named as respondents in the petition for judicial review. Petitioners argue the statute requires only that the agency, the OWRB, be named as a respondent and naming other respondents is optional. ¶15 The City urges this Court to consider opinions of the Court of Civil Appeals, which analyzed the statutory language prior to the 2011 amendments to 75 O.S., § 318, in order to determine what the Legislature intended to accomplish by amending § 318 in 2011. In the cases relied on by the City, the Court of Civil Appeals took the position that, because 75 O.S.2001, § 318(C) required the petitioner to serve a copy of the petition on "all other parties of record" in the administrative proceeding, § 318(C) implicitly required that all parties of record in the administrative proceeding also be joined as parties in the district court action for judicial review. See Okla. Found. for Med. Quality v. Dep't of Central Servs., 2008 OK CIV APP 30, ¶¶ 8-12, 180 P.3d 1, 3-4 (interpreting 75 O.S.2001, § 318(C)); H & En, Inc. v. Okla. Dep't of Labor, 2006 OK CIV APP 70, ¶¶ 10-11, 136 P.3d 1070, 1072 (same). ¶16 Opinions published by the Court of Civil Appeals have no precedential value and are merely persuasive. See Skinner v. John Deere Ins. Co., 2000 OK 18, ¶ 19, 998 P.2d 1219, 1223-24; Okla.Sup.Ct.R. 1.200(d)(2), 12 O.S.2023, ch. 15, app. 1. We are not persuaded by these decisions. First, the facts are distinguishable.4 Second, in those cases, the court interpreted a different version of the OAPA that did not contain the pertinent statutory language.5 Rather, we look to the actual text of 75 O.S.2011, § 318--the version of the OAPA that applies in this case. ¶17 The fundamental purpose of statutory construction is to ascertain and give effect to the intent of the Legislature. Rickard v. Coulimore, 2022 OK 9, ¶ 5, 505 P.3d 920, 923. To do this, we first look to the language of the statute. Id. If the statutory language is clear and unambiguous, this Court must apply the plain and ordinary meaning of the words. Id.; 25 O.S.2011, § 1. Only when the legislative intent cannot be determined from the statutory language due to ambiguity or conflict should rules of statutory construction be employed. Id. ¶18 In 2011, the Oklahoma Legislature amended the OAPA by adding the pertinent statutory language: "[P]roceedings for review shall be instituted by filing a petition . . . naming as respondents only the agency, such other party or parties in the administrative proceeding as may be named by the petitioner or as otherwise may be allowed by law . . . ." 75 O.S.2011, § 318(B)(2) (emphasis added). Section 318(C) was also amended to add, inter alia, the emphasized language: C. Copies of the petition shall be delivered in person or mailed, postage prepaid, to the agency and all other parties of record, and proof of such delivery or mailing shall be filed in the court within ten (10) days after the filing of the petition. Any party not named as a respondent in the petition is entitled to respond within ten (10) days of receipt of service. The court, in its discretion, may permit other interested persons to intervene. 75 O.S.2011, § 318(C) (emphasis added). Section 318(B)(2) and § 318(C) must be read together to determine what the Legislature intended when it amended subsections (B)(2) and (C) by adding this language.6 "Intent is ascertained from the whole act in light of its general purpose and objective considering relevant provisions together to give full force and effect to each." Keating v. Edmondson, 2001 OK 110, ¶ 8, 37 P.3d 882, 886. The Court presumes that the Legislature expressed its intent and that it intended what it expressed. Id. ¶19 City argues the legal conclusions made in the COCA cases were unaffected by the 2011 amendments. Petitioners argue that the 2011 amendments to the OAPA were intended to make the naming requirements more lenient. ¶20 We presume the Legislature was aware of, and responding to, the interpretation of § 318(C) in the Court of Civil Appeals decisions. "When ascertaining legislative intent the Court must presume that when adopting the amendment, the legislature had knowledge of the law as it previously existed and had in mind the judicial construction which had been placed on that law." Prettyman v. Halliburton Co., 1992 OK 63, ¶ 21, 841 P.2d 573, 580 (citations omitted). The language "naming as respondents only the agency, such other party or parties in the administrative proceeding as may be named by the petitioner or as otherwise may be allowed by law" was added to 75 O.S., § 318(B)(2) by legislative amendment in 2011. Section 318(C) was also amended in 2011 to add the language: "Any party not named as a respondent in the petition is entitled to respond within ten (10) days of receipt of service." 75 O.S.2011, § 318(C). These legislative amendments came after the COCA decisions that held all parties of record in the administrative proceeding must be joined as parties in the district court action for judicial review and such failure was a fatal, jurisdictional flaw. See Okla. Found. for Med. Quality v. Dep't of Central Servs., 2008 OK CIV APP 30, ¶¶ 8-12, 180 P.3d 1, 3-4; H & En, Inc. v. Okla. Dep't of Labor, 2006 OK CIV APP 70, ¶¶ 10-11, 136 P.3d 1070, 1072. We agree with Petitioners that the Legislature intended to make the procedural requirements more lenient by requiring only the agency be named as a respondent in the petition for review. ¶21 The language "such other party or parties in the administrative proceeding as may be named by the petitioner" is clearly and unambiguously permissive. In this case, the City (the permit applicant) and 85 protestants were parties in the administrative proceeding. "[A]s may be named by the petitioner" allows Petitioners to pick and choose which, if any, of the parties in the administrative proceeding are named as respondents in the petition for judicial review. Optionality is supported by the language "[a]ny party not named as a respondent in the petition is entitled to respond within ten (10) days of receipt of service" in 75 O.S.2011, § 318(C) (emphasis added). This language clearly contemplates that, while § 318(C) requires that a copy of the petition for review be delivered or mailed to every party of record7 in the administrative proceeding, every party may not be named as a respondent in the petition for review. ¶22 We hold that 75 O.S.2011, § 318(B)(2) of the OAPA does not require that the City be named as a respondent in the petition. Due process requires that all parties of record in the administrativeproceeding be given notice and an opportunity to be heard in the judicialreview proceeding. ¶23 Next, the City argues that the statutory language "naming as respondents . . . such other party or parties in the administrative proceeding . . . as otherwise may be allowed by law" requires that the City be named as a respondent. 75 O.S.2011, § 318(B)(2) (emphasis added). City argues "may," as used in this clause, does not create a permissive choice but, rather, connotates "possibility" and includes all parties required by law to be joined to the action. City contends that, as the recipient of the permit, it is a necessary and indispensable party to the judicial review proceeding and required by law to be joined and named as a respondent. The City argues it would be an unconstitutional interpretation of the statute to allow the Petitioners the option of excluding the City, whose property rights are being challenged and whose permit Petitioners seek to have rescinded, from the review proceeding. ¶24 It is undeniable that the City's interest, i.e., stream water permit, will be directly affected by the outcome of the judicial review proceeding. The City's application was the catalyzing event for the underlying administrative proceeding, and the City had the burden of proof in the administrative proceeding. However, one must bear in mind that this is not an original action in the district court. The district court is exercising its appellate jurisdiction under the OAPA. See 75 O.S., § 318; 12 O.S.2011, § 951. The OAPA applies, not the Oklahoma Pleading Code. Nonetheless, the statutory procedures must comport with the minimum standards of due process: notice and the opportunity to be heard. ¶25 Section 318(C) requires that the petitioner deliver or mail copies of the petition for review to "all other parties of record"8 in the administrative proceeding. Such parties then have ten days to respond to the petition for review. See 75 O.S.2011, § 318(C). While 75 O.S., § 318(B)(2) does not require that any parties of record to the administrative proceeding other than the agency be named as a respondent in the petition for review, all other parties of record in the administrative proceeding are entitled to notice and the opportunity to be heard, pursuant to 75 O.S., § 318(C). Here, it is undisputed that the City received a copy of the petition for review and had the opportunity to be heard.9 ¶26 The district court found that Petitioners' failure to name the City was a fatal, jurisdictional flaw, but that they should be permitted to amend their petition to name the City as a respondent and, therefore, the district court acquired jurisdiction to review the OWRB's order. The district court's May 7, 2018, order denying the City's motion to dismiss for lack of jurisdiction reached the correct result but for the wrong reason. This Court is not bound by the district court's reasoning and may affirm on a different legal rationale. See Hall v. GEO Grp., Inc., 2014 OK 22, ¶ 17, 324 P.3d 399, 406. We affirm the district court's order but do so on the basis that only the agency must be named as a respondent for the district court to acquire jurisdiction to review a final agency order under the OAPA, 75 O.S.2011, § 318(B)(2). The OAPA does not require that any other parties of record in the administrative proceeding be named as respondents in the petition for judicial review. All other parties of record in the administrative proceeding are, however, entitled to notice and the opportunity to be heard, which is satisfied by the requirements of 75 O.S.2011, § 318(C). II. REVIEW OF THE OWRB'S ORDER GRANTING THE STREAM WATERPERMIT ¶27 Next, we must review the district court's order on administrative appeal affirming the OWRB's order granting the stream water permit in conjunction with Petitioners' remaining propositions of error, including: (1) whether Purcell v. Parker, 2020 OK 83, 475 P.3d 834, is distinguishable from the facts of this case; (2) whether granting the City's Permit constitutes an unconstitutional taking of the Petitioners' water rights; (3) whether the district court properly denied the Petitioners' requests for limited discovery during the administrative appeal; and (4) whether the district court properly affirmed the OWRB's order granting the City's stream water permit by correctly applying Oklahoma stream water law. STANDARD OF REVIEW ¶28 OWRB decisions issuing or denying a stream water permit pursuant to 82 O.S.2011, §§ 105.1 through 105.32, are subject to judicial review under the OAPA. Appellate courts, including this Court, apply the same standard of review as the trial court to the administrative record. See Farmacy, L.L.C. v. Kirkpatrick, 2017 OK 37, ¶ 11, 394 P.3d 1256, 1259; City of Tulsa v. State ex rel. Pub. Employees Relations Bd., 1998 OK 92, ¶ 12, 967 P.2d 1214, 1219. Title 75, § 322, provides: (1) In any proceeding for the review of an agency order, the Supreme Court or the district or superior court, as the case may be, in the exercise of proper judicial discretion or authority, may set aside or modify the order, or reverse it and remand it to the agency for further proceedings, if it determines that the substantial rights of the appellant or petitioner for review have been prejudiced because the agency findings, inferences, conclusions or decisions, are: (a) in violation of constitutional provisions; or (b) in excess of the statutory authority or jurisdiction of the agency; or (c) made upon unlawful procedure; or (d) affected by other error of law; or (e) clearly erroneous in view of the reliable, material, probative and substantial competent evidence, as defined in Section 10 of this act [75 O.S., § 310], including matters properly noticed by the agency upon examination and consideration of the entire record as submitted; but without otherwise substituting its judgment as to the weight of the evidence for that of the agency on question of fact; or (f) arbitrary or capricious; or (g) because findings of fact, upon issues essential to the decision were not made although requested. (2) The reviewing court, also in the exercise of proper judicial discretion or authority, may remand the case to the agency for the taking and consideration of further evidence, if it is deemed essential to a proper disposition of the issue. (3) The reviewing court shall affirm the order and decision of the agency, if it is found to be valid and the proceedings are free from prejudicial error to the appellant. 75 O.S.2011, § 322. Under that standard, "an agency's order will be affirmed if the record contains substantial evidence in support of the facts upon which the decision is based, and if the order is otherwise free of error." Scott v. Okla. Secondary Sch. Activities Ass'n, 2013 OK 84, ¶ 26, 313 P.3d 891, 899. More specifically, the standard of review for findings and determinations made by the OWRB in its administrative proceedings is "that of substantial evidence and further that the findings should not be reversed unless they are clearly erroneous." Kline v. State ex rel. Okla. Water Res. Bd., 1988 OK 18, ¶ 7, 759 P.2d 210, 214. In all cases, a reviewing court should avoid re-weighing the evidence or substituting its judgment for that of the agency's on factual matters. See 75 O.S.2011, § 322(1)(e). ANALYSIS This Court's decision in Purcell v. Parker is distinguishable from this case. ¶29 Purcell v. Parker, 2020 OK 83, 475 P.3d 834, was decided on October 6, 2020, and, at first glance, appears to have determined Petitioners first issue on appeal in this case: notice by publication is unconstitutional and the permit is invalid. However, the facts in this case are readily distinguishable. Here, the Petitioners had actual notice of the application and participated in the OWRB hearings and judicial review. There is an additional issue to address, including whether Petitioners have standing to challenge notice. ¶30 Petitioners assert that the Kiamichi River Basin generally encompasses LeFlore, Latimer, Pushmataha, Pittsburg, Atoka, and Choctaw counties. It does not include McCurtain County. The City's notice by publication purportedly followed the requirements of 82 O.S., § 105.11 and O.A.C. § 785:20-5-1 for Latimer, Pushmataha, Pittsburg, Choctaw, and McCurtain counties, but not for LeFlore and Atoka counties. In paragraphs 6 and 52 of the Final Order of October 10, 2017, the OWRB presumed that publication in local newspapers satisfied the constitutional protections of due process. There is a secondary issue of whether property owners in LeFlore and Atoka counties were entitled to notice at all. Petitioners rely on this Court's decision in Purcell that notice by publication is defective "if the affected landowners are known, or reasonably discoverable, notice provided by publication results in an unconstitutional exercise of jurisdiction and a denial of due process" and, therefore, the permit is invalid. See Purcell, 2020 OK 83, ¶ 24, 475 P.3d at 844 (citations omitted). Petitioners assert that the City could have identified and served each and every property owner in the Kiamichi River Basin using records from the county clerks. ¶31 The City responds that Petitioners do not have standing to challenge notice. Because they were represented at the OWRB hearing and in this action, Petitioners clearly had actual notice. While many of the Petitioners are riparian landowners, they have not demonstrated any cognizable economic harm from notice by publication. Petitioners implicitly rely on third party standing, but that also fails. See Forest Oil Corp. v. Corp. Comm'n of Okla., 1990 OK 58, ¶ 19, 807 P.2d 774, 788 ("Generally, constitutional rights are personal and may not be asserted vicariously."). ¶32 The City also argues the District Court properly determined the City satisfied the 2017 notice requirements. According to the 2017 state statutes and regulations, notice only needed to be published in the county of the point of diversion (Pushmataha County) and within the adjacent downstream county (Choctaw County). The City published in other counties in excess of the statutory requirement. Oklahoma law, not the Settlement Agreement,10 governs the permitting decision. Also, there is no authority that Petitioners were entitled to notice of the Settlement Agreement. ¶33 The City argues Purcell is distinguishable. The Purcell decision does not indicate whether it applies to cases pending in the appellate pipeline. The City urges this Court not to apply Purcell here, arguing that retroactivity is not required because Petitioners received notice and participated extensively in the "truth determining process." The City argues it relied on the long-standing contrary statutory policy and applying Purcell would have a destabilizing effect. Because Petitioners lack standing to raise the notice issue, this is not a case of similarly- situated litigants who properly preserved the issue on appeal and would be left unprotected by the appellate process. ¶34 The standing and procedural posture in this case and Purcell are distinguishable. In Purcell, neighbors did not receive notice and did not timely protest or participate in the OWRB hearing. Purcell, 2020 OK 83, ¶¶ 5-6, 475 P.3d at 836-37. The Purcell neighbors discovered the OWRB meeting and were given five minutes to comment. Id. ¶¶ 7-8, at 838. The Purcell neighbors filed a declaratory judgment action. Id. It was not an appeal from an administrative agency's final order. Id. ¶ 14, at 841. Here, Petitioners timely protested and fully participated in the OWRB proceedings and judicial review. Petitioners participated in the permitting process for four years. The integrity of the truth determining process was protected. ¶35 The OWRB responds that it is difficult to understand how Petitioners' constitutional rights to notice and opportunity to be heard were violated when they were aware of the application and participated in the administrative proceedings and during judicial review. We agree. Notice to all property owners within the Settlement Agreement area is not required by law or due process. The Settlement Agreement applies to all counties in the Kiamichi River Basin, but state law and the OWRB's notice procedures do not -- they only require notice in the county of the proposed diversion and the downstream county because it is those appropriative and domestic riparian users who may be impacted by a new diversion even though the existing rights of those water users remain unchanged. Petitioners lack standing. We hold the facts in Purcell are distinguishable from this case. Granting the City's stream water permit does not constitute an unconstitutional taking of Petitioners' water rights; instead, it is a proper exercise of the State's police powers. ¶36 Appropriative and riparian rights are coexistent, prevailing water law in Oklahoma. See 82 O.S.2011, § 105.1A; 82 O.S.2011, § 105.2. An "appropriative right" means the right to take a specific quantity of water by direct diversion from a stream and to apply such water to a specific beneficial use. See O.A.C. § 785:20-1-2. A "riparian right" means the right of an owner of land adjoining a stream or watercourse to use water from that stream for reasonable purposes. Riparian rights are limited to domestic use and pre-1963 vested rights. See 82 O.S.2011, § 105.1A; 82 O.S.2011, § 105.2(D). ¶37 Before taking final action on a stream water permit application, the OWRB determines from the evidence four points of law ("Four Points of Law") pursuant to O.A.C. § 785:20-5-4(a): (1) Unappropriated water is available in the amount applied for [82:105.12(A)(1)] (as set forth in 785:20-5-5(a) and (b)); (2) The applicant has a present or future need for the water and the use to which applicant intends to put the water is a beneficial use. In making this determination, the Board shall consider the availability of all stream water sources and such other relevant matters as the Board deems appropriate, and may consider the availability of groundwater as an alternative source [82:105.12(A)(2)] as set forth in 785:20-5-5(c); (3) The proposed use does not interfere with domestic or existing appropriative uses [82:105.12(A)(3)] as set forth in 785:20-5-5(d); and (4) If the application is for the transportation of water for use outside the stream system wherein the water originates, [82:105.12(A)(4)] the provisions of Section 785:20-5-6 are met. O.A.C. § 785:20-5-4(a) (emphasis in original). If the OWRB determines these Four Points of Law and the applicable provisions of Chapter 20 of the regulations have been established, then the OWRB "shall approve the application by issuing a permit to appropriate water." O.A.C. § 785:20-5-4(b) (emphasis in original); 82 O.S.2011, § 105.12(A). ¶38 When the OWRB granted the City's Permit, it was a proper exercise of the state's police power. The granting of the City's Permit does not abolish the domestic riparian and appropriative uses of others. In fact, the evidence presented at the hearing before the OWRB shows there is unappropriated water in the Kiamichi River and Sardis Lake on an average annual basis in excess of the City's Application, even after existing appropriative uses and domestic riparian uses are considered.11 During the administrative hearing, Petitioners offered no evidence of a better method for calculating unappropriated water or specific evidence as to how their rights may be harmed by the granting of the stream water application. In fact, none of the Petitioners presented any quantification of their riparian rights to rebut the City's showing of non-interference. Instead, they argue general harm without any specific supporting evidence, which is not sufficient. ¶39 The Oklahoma Legislature provided the OWRB with the authority to complete studies of water systems and to issue permits for appropriation of water under the state's police powers. See 82 O.S., § 105.1 et seq. The state may control the flow of all nonnavigable streams and it may reserve to itself or grant to private parties the right to utilize such streams for power and other purposes. The statutes provide the Board's guidelines for regulation, including requirements for notice, approval by the Board, and reversion of water to the public due to non-use. In its effort to protect the public interest in water, the Legislature has provided for the OWRB's involvement in all aspects of stream water use, including appropriation of stream water. ¶40 The Oklahoma Legislature has also provided the district courts with the authority to adjudicate water rights. Id. If the Board determines that an adjudication of water rights is in the best interest of those using a particular stream, the Board may institute a suit in the district courts on behalf of the state. See 82 O.S.2011, § 105.6. However, this is not a prerequisite to the granting of a water use permit. Moreover, the statutes also contain a provision for the domestic riparian and existing appropriative users to seek remedy for interference in the district court. See 82 O.S.2011, § 105.5. In this regard, Petitioners are not left without recourse should any future interference with their water rights occur because of the City's permit. Section 105.5 provides that if any interference with the water rights occurs, any domestic riparian and existing appropriative user can seek remedy for interference in the district court. See 82 O.S., § 105.5. ¶41 We hold the statutes are clear -- the OWRB has the authority to issue the permit for appropriation of stream water and such a determination is within the scope of the state's police powers and not a taking of a protected property interest. The June 1, 2020, order granting the City's Permit, accounted for riparian and existing appropriative uses before granting the stream water permit, and the district court properly found that the City and the OWRB were in substantial compliance with all Federal and State laws and regulations. The district court properly denied Petitioners' request to conduct limited discovery and testimony on administrative appeal pursuant to 75 O.S.2011, § 321. ¶42 Petitioners argue they were denied the opportunity to conduct official discovery and bring evidence of "alleged irregularities in procedure before the agency, not shown in the record," that had been discovered after the final October 10, 2017, OWRB hearing. See 75 O.S.2011, § 321. Specifically, Petitioners allege that counsel for Petitioners was told by sources that at least one state official had privately intervened with scholars at Oklahoma State University (OSU) to delay publication of research about stream flow data and related environmental concerns about the Kiamichi River. Even though scholars and others denied that this had ever occurred, counsel for Petitioners asked the district court for limited discovery on the issue to see whether there were any irregularities in the process which marred the decision-making process. ¶43 Judicial review of agency decisions "shall be conducted by the court without a jury and shall be confined to the record, except that in cases of alleged irregularities in procedure before the agency, not shown in the record, testimony thereon may be taken in the court. The court, upon request, shall hear oral argument and receive written briefs." 75 O.S.2011, § 321. The only exception allowing courts to look beyond the administrative record is limited to witness testimony regarding alleged irregularities in procedures which are not otherwise shown in the administrative record. See, e.g., Seely v. Okla. Horse Racing Comm'n, 1987 OK CIV APP 61, ¶ 11, 743 P.2d 685, 691 (holding the district court properly refused to allow evidence of horse racing testing procedure irregularities where the evidence was not raised during the administrative proceeding); Baggett v. Webb, 1976 OK 176, ¶¶ 3, 22, 557 P.2d 433, 433-36 (holding the district court should have allowed testimony as to alleged irregularities where the administrative hearing was not recorded or transcribed). Furthermore, the exception regarding procedural irregularities is discretionary on the part of the reviewing court, provided that actual evidence of irregularities is properly tendered to the court. See 75 O.S.2011, § 321 ("testimony thereon may be taken in the court") (emphasis added). We hold there was no actual evidence of irregularities presented to the court. ¶44 Petitioners generally allege that the OWRB was under pressure to grant the City's Permit from earlier litigation as resolved by the Settlement Agreement. However, Petitioners did not present any specific evidence of irregularities in the procedure. For example, the Petitioners did not submit any affidavits from the alleged "sources" who had informed Petitioners about the alleged state official who privately intervened with scholars at OSU and allegedly delayed publication of research about stream flow data and related environmental concerns about the Kiamichi River. Instead, Petitioners mistakenly believed that mere allegations of irregularities entitle them to conduct discovery in hopes of finding irregularities. We hold the district court properly denied Petitioners' requests for discovery and testimony on administrative appeal because Petitioners' general allegations of procedural irregularities failed to meet the exception for allowing additional testimony outside of the administrative record pursuant to 75 O.S., § 321. ¶45 The District Court, in its Order of June 1, 2020, concluded: In reviewing the record, the Court determines that there appears to be no evidence of political whim or pressure on the OWRB's ruling and the Court finds there is a presumption of correctness in their ruling that cannot be overruled by the Court. Order, June 1, 2020, at ¶ 34. ¶46 In this case, Petitioners allege that "after the OWRB decision in October of 2017, counsel for the Petitioners was told by sources that at least one state official privately had intervened with scholars at Oklahoma State University to delay publication of research about stream flow data and related environmental concerns about the Kiamichi River." Appellants' Brief-in-Chief, at 14. Petitioners later contend that the "U.S. Department of Interior had refused to allow an expert employed by the U.S. Geological Survey at Oklahoma State University to testify."12 Id. at 15. ¶47 We agree with the City's argument that the DOI's denial was unrelated to any action by the OWRB or the City, and the District Court had no jurisdiction to reverse or otherwise challenge the Touhy decision by the United States. See C.F.R. § 2.281(a); United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951). We likewise agree that a Touhy decision made pursuant to federal law cannot constitute a "procedural irregularity" contemplated by 75 O.S.2011, § 321. ¶48 As an additional alleged error of law, the Petitioners argue for the first time in their Brief-in-Chief on appeal that the OWRB was under pressure to grant the City's Application from earlier litigation as resolved by the Settlement Agreement. 75 O.S.2011, § 316 specifies the procedure for raising an undue influence issue: Any party may request the disqualification of a hearing examiner or agency member, on the ground of his inability to give a fair and impartial hearing, by filing an affidavit, promptly upon discovery of the alleged disqualification, stating with particularity the grounds upon which it is claimed that a fair and impartial hearing cannot be accorded. Notably, this Court has repeatedly rejected appellate claims of partiality where the complaining party never sought disqualification at the administrative proceeding under 75 O.S.2011, § 316. See, e.g., Lowrey v. Hodges, 1976 OK 132, ¶ 23, 555 P.2d 1016, 1024; Robbins v. Okla. Alcoholic Bev. Control Bd., 1969 OK 202, ¶ 19, 461 P.2d 610, 613. ¶49 Here, Petitioners never sought disqualification during the administration proceeding. Likewise, Petitioners did not promptly file an affidavit pursuant to 75 O.S., § 316 -- which is mandatory. See Robbins, 1969 OK 202, ¶ 19, 461 P.2d at 613 (The prompt affidavit requirement is one of "substance and not merely of form" and is a mandatory step for an appellant seeking disqualification during the administrative proceeding.). As a result, Petitioners failed to properly raise an issue of undue influence and the district court did not err in denying Petitioners' requests for discovery on administrative appeal in this regard. ¶50 Moreover, even if Petitioners had properly raised the issue of undue influence, there is no evidence in the record to support Petitioners' claims that the Board was under undue pressure. In fact, the opposite is true. The Board members heard argument from each party at the Board meeting prior to the vote. The Board members also all had access to review the recording of four days of testimony and one day of public comment prior to the vote. In sum, there is no evidence to support, or otherwise contemplate, that the Board was unduly influenced in making its decision. ¶51 Lastly, Petitioners assert the hearing examiner erred during the administrative proceeding by excluding evidence of environmental concerns, including a letter from the U.S. Fish and Wildlife Service ("FWS") dated April 10, 2017, that raised concerns about the effects of the City's proposed Permit on species of conservation concern. The City argues that Oklahoma stream water law does not contemplate consideration of environmental purposes, such as instream flow, for streams like the Kiamichi River that have not been designated as a "scenic river area" or "Outstanding Resource Waters." Importantly, the record on appeal clarifies that the hearing examiner did not grant or deny the City's pre-hearing motion in liminie to exclude the FWS April 10, 2017, letter, but rather held that "the letter itself will have to be undergirded with additional information if anyone wants to use it specifically as evidence." (citation omitted). ¶52 We agree with the City that to the extent the hearing examiner excluded evidence regarding environmental concerns, the hearing examiner did so pursuant to his/her authority of a judicial nature to marshal the relevancy of evidence and testimony. See 75 O.S., § 250.3(8); 82 O.S., § 1085.10; O.A.C. §§ 785:4-7-5(b); Tulsa Classroom Teachers Ass'n v. State Bd. of Equalization, 1979 OK 136, ¶ 5, 601 P.2d 99, 101-02. ¶53 The City complied with all discovery and evidentiary requirements during the administrative hearing -- including responding to multiple rounds of Petitioners' written discovery requests and producing over one hundred documents. In the district court on the petition for review, the City opposed additional discovery requests and admission of evidence in line with the general rule that judicial review of agency orders is "confined to the record" pursuant to 75 O.S.2011, § 321. We affirm the district court's order denying Petitioners' request for additional discovery on administrative appeal as the record contains substantial evidence in support of the facts upon which the decision was based and the order is otherwise free from error. The district court's order affirming the OWRB's order granting the City's stream water permit was free from prejudicial error. ¶54 Before taking final action on a stream water permit application, the OWRB must determine from the evidence presented, pursuant to O.A.C. § 785:20-5-4(a) whether: (1) Unappropriated water is available in the amount applied for; (2) The applicant has a present or future need for the water and the use to which applicant intends to put the water is a beneficial use; (3) The proposed use does not interfere with domestic or existing appropriative uses; (4) If the application is for the transportation of water for use outside the stream system wherein the water originates, the provisions of Section 785:20-5-6 are met. O.A.C. § 785:20-5-4(a) (emphasis in original). If the Board determines from the record that the elements are satisfied, the Board shall approve the permit. See 82 O.S., § 105.12(A)(5). Petitioners argue the OWRB and the district court erred by improperly calculating the available stream water and evaluating beneficial use; thus, the Board did not properly apply the Four Points of Law in O.A.C. § 785:20:5-4. We address each of Petitioners' allegations of error in turn below. 1. The district court and the OWRB correctly determined there is sufficient unappropriated water available in the amount applied for to satisfy the first point of law. ¶55 Petitioners argue the OWRB's order was in error because the City did not demonstrate that the Kiamichi River Model satisfied the first point of law, including the use of the Belzoni gauge to determine the flows in the Kiamichi River. Petitioners argue the OWRB and the district court failed to follow Oklahoma law for calculating available stream water under the first point of law. See O.A.C. § 785:20-5-5(a)(1). More specifically, Petitioners take issue with the Kiamichi River Model because they allege it improperly applies historical or outdated data from the Belzoni gauge. ¶56 The City on the other hand, argues the Kiamichi River Model meets its burden under the first point of law. It argues the Kiamichi River Model uses the variables and logic statements specifically tailored to the elements required by O.A.C. § 785:20-5-5(a)(1), which includes the model's raw data showing: precipitation, evaporation, flow records, stream gauge measurements, runoff, lake elevations, and storage capacity for the Southeast System's five reservoirs. The City contends the Kiamichi River Model appropriately applies the statutory formula for measuring available stream water, and that unappropriated water is available in the amount for which the City applied. To support this conclusion, the City's expert testified at length how the Kiamichi River Model demonstrated that 115,000 acre-feet per year ("AFY")13 is available considering the mean annual precipitation run-off, the mean annual flow, and stream gauge measurements, and prioritizing domestic uses, and existing appropriations. Additionally, the Kiamichi River Model considered the Red River Compact pursuant to O.A.C. § 785:20-5-5(a)(1), a 20,000 AFY set aside in Sardis Lake pursuant to O.A.C. § 785:20-5-5(b)(3), and a proposed lake level management plan pursuant to O.A.C. § 785:20-5-5(b)(3)(iv). ¶57 The City's engineering expert also testified that he carefully selected the Belzoni gauge for the important variable flow data because it provided forty-five years of varying historical data between 1926 and 1971, which predated the 1982 construction of Sardis Lake and because it showed how the Kiamichi River basin existed under natural stream conditions. ¶58 The OWRB reviewed the Kiamichi River Model and found it "satisfied OWRB stream water rules and statutes for permitting in the basin." Based on the record and the substantial evidence presented, we agree. Ultimately, the OWRB concluded: "[T]he Board finds that unappropriated water is available at the diversion point and in the amounts applied for by the applicant." In all cases, a reviewing court should avoid re-weighing the evidence or substituting its judgment for that of the agency's on factual matters. See 75 O.S.2011, § 322(1)(e). We will not re-weigh the evidence or substitute our judgment for that of the agency on factual matters in this case and find no evidence of prejudicial error as to Petitioners first allegations of error. 2. The district court and the OWRB properly concluded the City intends to put the water to "beneficial use" as evaluated under the Four Pointsof Law. ¶59 Petitioners allege the OWRB should have considered an additional element of "environmental issues, impacts upon economic activity, and more" as part of "beneficial use" under the Four Points of Law. Under Oklahoma stream water law, "beneficial use" is a factor that must be determined before a permit can be issued. See 82 O.S., § 105.12(A)(4)(B).14 When reviewing the beneficial uses for this purpose, the Board applies the definition from O.A.C. § 785:20-1-2, which defines beneficial use as: [T]he use of such quantity of stream or groundwater when reasonable intelligence and reasonable diligence are exercised in its application for a lawful purpose and as is economically necessary for that purpose. Beneficial use include but are not limited to municipal, industrial, agricultural, irrigation, recreation, fish and wildlife. . . . ¶60 The City argues the definition of beneficial use applies only in the context of an appropriative permit. It argues the definition of beneficial use does not create a non-consumptive instream flow requirement. See O.A.C. § 785:20-1-1; O.A.C. § 785:20-1-2. We agree with the City. While an applicant may apply for a permit to appropriate water for a fishing pond or to water wildlife, general protection of environmental flows is not one of the statutory elements to be determined by the Board. See 82 O.S., § 105.12. ¶61 Next, Petitioners cite to Franco-American Charolaise, Ltd. v. Oklahoma Water Resources Board, 1990 OK 44, 855 P.2d 568, to support their position that the Board is required to consider non-consumptive flows to protect wildlife and recreation. However, the decision in Franco-American Charolaise does not impact the result in this case, as it does not create a general requirement that water be left in a stream for fish and wildlife. ¶62 In conclusion, the hearing examiner did not err by excluding evidence from the United States Fish and Wildlife Service because environmental impacts are not a statutory or common law element to be considered by the OWRB when considering an application for stream water permit. In the same regard, the hearing examiner also did not err by not incorporating the testimony of Dr. Caryn Vaughn, Ph.D., regarding her work studying endangered mussels in the Kiamichi River. Importantly, Dr. Vaughn admitted she did not conduct an instream flow study and she did not offer an opinion on what a proper environmental flow would be based on if conducted by others.15 Furthermore, even if environmental impacts were a statutory element, Petitioners offered no evidence at the hearing to show that the granting of the Application would impact the area. Instead, the OWRB order addresses the factors related to the use of the stream system of origin and found that adequate water is available for future needs within the basin for municipal, industrial, domestic and other beneficial uses that do not interfere with domestic or existing appropriate uses pursuant to 82 O.S., § 105.12. ¶63 The district court properly affirmed the OWRB's order which correctly applied the Four Points of Law found in O.A.C. § 785:20-5-4. The OWRB's decision to grant the stream water permit under the terms contained in the order is based on substantial evidence in the record and contains no clear error that would prejudice the Petitioners. CONCLUSION ¶64 We hold the district court had jurisdiction to review the OWRB's final order granting a stream water permit to the City and the district court's order denying Petitioners' challenge to the stream water permit is affirmed. ORDER OF THE DISTRICT COURT IS AFFIRMED. CONCUR: Kane, C.J., Rowe, V.C.J., Winchester, Edmondson, Gurich, and Darby, JJ. CONCURS IN PART; DISSENTS IN PART: Kauger, J. (by separate writing); CONCUR IN RESULT: Combs and Kuehn (by separate writing), JJ. FOOTNOTES 1 Petitioners Dale Jackson and Justin Jackson are not parties to this appeal. 2 Similarly, we have long held that the codefendant naming requirements for judicial review under the Oklahoma Employment Security Act (OESA) are jurisdictional. See, e.g., Davis v. Okla. Employ. Sec. Comm'n, 2010 OK 45, 238 P.3d 922; Okla. Employ. Sec. Comm'n v. Carter, 1995 OK 74, 903 P.2d 868; Edmondson v. Siegfried Ins. Agency, Inc., 1978 OK 45, 577 P.2d 72. 3 Even prior to the addition of this language in 2011, the Court of Civil Appeals held that the agency is a necessary party and must be named as a respondent in the petition for judicial review. See Klopfenstein v. Okla. Dep't of Human Servs., 2008 OK CIV APP 16, ¶ 10, 177 P.3d 594, 596 (interpreting 75 O.S.2001, § 318(B)-(C)); Transwestern Pub., L.L.C. v. Langdon, 2004 OK CIV APP 21, ¶¶ 7-8, 84 P.3d 804, 806 (same). 4 In Klopfenstein v. Oklahoma Department of Human Services, 2008 OK CIV APP 16, ¶ 4, 177 P.3d 594, 596, and Langdon, 2004 OK CIV APP 21, ¶ 3, 84 P.3d at 805, the agency was not named as a respondent. In Foundation, 2008 OK CIV APP 30, ¶¶ 3-4, 180 P.3d at 2, and H & En, 2006 OK CIV APP 70, ¶¶ 4-6, 136 P.3d at 1071, a party of record in the administrative proceeding (not the agency) was not named as a respondent and that party was not served a copy of the petition as required by 75 O.S.2001, § 318(C). This case is clearly distinguishable from Foundation and H & En. The City is a party of record in the administrative proceeding (not the agency issuing the final agency order) that was not named as a respondent, and the City was served with a copy of the petition. 5 The prior version of the OAPA that applied in the COCA decisions provided, in pertinent part: 2. . . . [P]roceedings for review shall be instituted by filing a petition . . . within thirty (30) days after the appellant is notified of the final agency order as provided in Section 312 of this title. C. Copies of the petition shall be served upon the agency and all other parties of record, and proof of such service shall be filed in the court within ten (10) days after the filing of the petition. The court, in its discretion, may permit other interested persons to intervene. 75 O.S.2001, § 318(B)(2), (C). 6 See supra note 5. 7 "[A]ll other parties of record" refers to the parties in the administrative proceeding. As used in the OAPA, "party" means "a person or agency named and participating, or properly seeking and entitled by law to participate, in an individual proceeding . . . ." 75 O.S.Supp.2013, § 250.3(14). 8 See supra note 7. 9 No objection was made as to service of the petition for review, and the City entered a special appearance to contest jurisdiction. 10 The City originally filed an application with the Oklahoma Water Resources Board (OWRB) for a permit to appropriate stream water from the Kiamichi River and Sardis Lake in 2007. This process resulted in extensive litigation in federal court. After five years of settlement negotiations related to this litigation and while the application to appropriate stream water was pending, in 2016, the City signed a historic Settlement Agreement ("Settlement Agreement") with the State of Oklahoma, the Choctaw Nation of Oklahoma, and the Chickasaw Nation, which was subsequently approved by the United States Congress. The Settlement Agreement, among other things, contains the consent of the Choctaw and Chickasaw Nations to the City's permit application to the OWRB, subject to the terms of the Settlement Agreement. In January 2017, the City filed its second amended permit application -- which is the subject of this appeal. 11 The OWRB estimates domestic riparian uses generously assuming the following: (1) household uses 6 AFY; (2) a household is 160 acres (based on original homesteads); and (3) the intensity of household use is over the entire watershed upstream of the proposed diversion point, rather than simply the lands riparian to the stream. See O.A.C. § 785:20-5-5(a)(2). 12 Based on a review of the record on appeal, the City argues in their Combined Answer Brief and Brief-in-Chief on Cross Petition that it believes the Petitioners are referring to these two encounters as the same event. In Petitioners' June 29, 2018, Motion to Compel Discovery, Petitioners insinuated (but did not directly allege) that an OWRB official had affected the U.S. Department of Interior's ("DOI") decision to deny Petitioners' Touhy request for the testimony of Dr. Shannon Brewer, a U.S. Geological Survey employee affiliated with Oklahoma State University. See United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951). 13 One acre-foot is the volume of water that would cover one acre of land to a depth of one foot, and is equivalent to 43,560 cubic feet, or 325,851 gallons. See O.A.C. § 785:20-11-6. 14 82 O.S.2011, § 105.12(A)(4)(B) provides: A. In order to protect the public welfare of the citizens of Oklahoma and before the Oklahoma Water Resources Board takes final action on the application, the Board shall determine from the evidence presented whether: . . . 4. If the application is for the transportation of water for use outside the stream system wherein the water originates, the proposed use must not interfere with existing or proposed beneficial uses within the stream system and the needs of the water users therein. In making this determination, the Board shall utilize the review conducted pursuant to subsection B of this section; and . . . B.1. In the granting of water rights for the transportation of water for use outside the stream system wherein water originates, pending applications to use water within the stream system shall first be considered in order to assure that applicants within the stream system shall have all of the water required to adequately supply their beneficial uses. 2. The Board shall review the needs within the area of origin every five (5) years to determine whether the water supply is adequate for municipal, industrial, domestic, and other beneficial uses. (emphasis added). 15 The OWRB order did acknowledge Dr. Vaughn's testimony but concluded Petitioners' environmental contentions "either are not supported by the record, not supported by law, or are beyond the scope of the Board's jurisdiction in this proceeding, and therefore should be not addressed by the Board." KAUGER, J., concurring in part/dissenting in part: ¶1 My dissent is directed to the failure to provide compliance with constitutional notice requirements. Notwithstanding any factual differences between Purcell v. Parker, 2020 OK 83, 475 P.3d 834, and this cause, Purcell is instructive and controlling regarding the necessity of proper notice. Even if statutory notice provisions are complied with, the notice given must also comply with constitutional due process requirements. It appears this was not done in this cause, and thus, this administrative proceeding and subsequent district court review, were invalid from the beginning. ¶2 The majority opinion notes, in ¶30 that: Petitioners assert that the Kiamichi River Basin generally encompasses LeFlore, Latimer, Pushmataha, Pittsburg, Atoka, and Choctaw counties. It does not include McCuttain County. The City's notice by publication purportedly followed the requirements of 82 O.S. , § 105.1 and O.A.C. §785:20-5-1 for Latimer, Pushmataha, Pittsburg, Choctaw, and McCurtain counties, but not for LeFlore and Atoka counties. In paragraph 6 and 52 of the Final Order of October 10, 2017, the OWRB presumed that publication in local newspapers satisfied the constitutional protections of due process. . . (Emphasis supplied). The City notice by publication purportedly followed statutory requirements for some, but not all of the landowners affected, and the OWRB presumed that this was satisfactory? It cannot be. ¶3 In Purcell, we very clearly explained that, even when statutory notice procedures were properly followed, the procedures must accord with fundamental due process. When a landowner's property interest is involved in the proceeding, notice by publication is insufficient when the actual whereabouts of the landowners are known or can be reasonably ascertainable. Anything less results in an unconstitutional exercise of jurisdiction insofar as the interest of the owner is affected. This applies to administrative proceedings as well as court proceedings. In this cause, even if some landowners did not receive any actual notice, but participated as a result of notice by publication, at least two counties were omitted from any notice whatsoever. No determination was made concerning who any of the actual landowners were, and whether they could have been given actual notice. ¶4 In Cate v. Archon Oil Co., Inc., 1985 OK 15, 695 P.2d 1352, we addressed the constitutionality afforded pre-procedural due process required when an oil and gas lease of real property is being sold at a sheriff's sale. The statute at issue in Cate only required notice by publication. There, we recognized that notice by publication postings are designed primarily to attract prospective purchasers, and are unlikely to reach those who have an interest in the property. If the actual whereabouts of the parties are known, failure to afford personal notice to those who have an interest or estate in real property sought to be sold in satisfaction of a judgment results in an unconstitutional exercise of jurisdiction insofar as the interest of the owner is affected. We stated that: 1) Notice is a jurisdictional requirement and fundamental element of due process;2) Due process requires adequate notice, a realistic opportunity to appear at a hearing, and the right to participate in a meaningful manner before one's rights are irretrievably altered; 3) The right to be heard is of little value unless adequate notice is given; and4) Due process is violated by the mere act of exercising judicial power upon process not reasonably calculated to apprise interested parties of the pendency of an action, and lack of notice constitutes a jurisdictional infirmity. ¶5 Similarly, in Dulaney v. Okla. State Dept. of Health, 1993 OK 113, 868 P.2d 676, we addressed notice and the opportunity for an individual proceeding in the context of a landfill permit. We recognized that adjacent landowners had constitutional rights sufficient to require the application of due process, and were entitled to notice and an opportunity to be heard. We said that: ¶18. . .The use and control of fresh water is a matter of publici juris, and of immediate local, national, and international concern. No commodity affects and concerns the citizens of Oklahoma more than fresh groundwater. . . These landowners' water-related property interest alone requires that they be given notice and an opportunity to participate in a hearing whose outcome could affect their constitutionally protected rights. . . . ¶6 In Harvey R. Carlile Trust v. Cotton Petroleum, 1986 OK 16, 732 P.2d 438, a case involving standards of adequate notice in spacing proceedings before the Corporation Commission, we held, concerning notice by publication, that it is not reasonably calculated to provide actual knowledge of instituted proceedings. It is an inadequate method to inform those who could be notified by more effective means such as personal service or mailed notice. Mail service is an inexpensive and far more efficient mechanism to enhance the reliability of notice than either publication or posting. When a party's name and address are reasonably ascertainable from sources available at hand, communication by mail or other means certain to insure actual notice is deemed to be a constitutional prerequisite in every proceeding which affects either a person's liberty or property interests. ¶7 We held that the face of an administrative proceeding must affirmatively show a diligent but unsuccessful effort to reach the affected party by better process. Courts may not presume publication service alone to be constitutionally valid when the judgment roll or record of an administrative proceeding fails to show that the means of imparting better notice were diligently pursued but proved unavailable. ¶8 Under nearly forty years of our jurisprudence, the proceedings at issue here should be invalidated from the beginning. If you know how to find them, you have to tell them. KUEHN, J., Concurring in Result: ¶1 I concur in the result reached by the Court. However, the Court squanders an opportunity to clarify the law on water rights. The parties cite Franco-American Charolaise, Ltd. v. Okla. Water Res. Bd., 1990 OK 44, 855 P.2d 568, as pertinent to the issues presented. The analysis in Franco-American, however, has been abrogated by amendments to the relevant statutes. I believe Franco-American was wrongly decided in the first place, but regardless, any doubts over its interpretation of law have since been dispelled by a clear expression of legislative intent. It is time to officially overrule Franco-American, declare the current statutes constitutional, and clear the waters for all Oklahomans. ¶2 The water-law battle between the Court and the legislature began in 1990, after this Court issued its decision in Franco-American. In 1963, our legislature reformed our State's water code.1 As in many other States, riparian rights to water were replaced with a prior-appropriations system.2 In Franco-American, this Court determined the 1963 statutes did not abrogate the common-law riparian system, and therefore, limiting common-law riparian rights would constitute an impermissible taking of personal property without just compensation.3 In a fractured opinion, the majority found that the exercise of the State's police power to protect waters from waste, and to protect the general public, cannot extend to abrogate the riparian right to the normal flow or the normal underflow of the stream.4 The holding preserved common-law riparian rights and declared that a riparian owner is entitled to reasonable use -- not just domestic use -- of water.5 ¶3 In 1993, the legislature responded to Franco-American with amendments to the water code. If the question posed by Franco-American was, "Did the legislature really mean to replace riparian law with an appropriations system?", then the 1993 statutory amendments provide a resounding "Yes." The remaining holding of Franco-American -- that the State's police power cannot extend to a riparian right without it being an unconstitutional taking -- should also be moot with the abrogation of riparian law. ¶4 Despite the 1993 amendments, this Court has passed on overruling Franco-American.6 Be that as it may, the Oklahoma Water Resources Board (OWRB) administers water rights through an appropriation system consistent with existing law. 82 O.S. §105.9.7 Moreover, under 60 O.S. §60 -- in existence before Franco-American was decided -- riparian rights are limited to domestic use (not reasonable use), and water not needed for domestic purposes "becomes public water and is subject to appropriation for the benefit and welfare of the people of the State."8 ¶5 Franco-American should be overruled. Even if that decision had been a sound interpretation of the water code as it existed in 1990, the 1993 amendments dispel any doubt about legislative intent. Second, the current statutes, 60 O.S. § 60, 82 O.S. § 105.1A and § 105.2, are constitutional. Article 2 § 24 of the Oklahoma Constitution provides that "private property shall not be taken or damaged for public use without just compensation." The administrative code requires the OWRB to determine the Four Points of Law when determining water rights under the statutes cited above.9 Within the Four Points, it must be determined that the riparian domestic use is not harmed. If it is, no permit. If it is not, then there logically has been no improper "taking" of private property. Once a riparian owner has reaped the benefits of all domestic use, and first-in-time, first-in-right appropriated owners prove their needs and those needs are met, only then is there "unappropriated water." That water belongs to the citizens of Oklahoma. ¶6 The legislature has a right to use its police powers to protect the welfare of its citizens, including their need for a natural resource as fundamental as water. It makes no sense to argue that a riparian or appropriated owner has a right to be compensated for unappropriated water. Imagine a landowner who dams a natural lake or tributary, and charges whatever compensation they desire for that natural resource they have in abundance? Citizens and towns, especially those without monetary resources, would suffer tremendously. "Property often comes in the form of a bundle of entitlements, but the 'destruction of one strand of the bundle is not viewed as a taking because the aggregate must be viewed in its entirety."10 ¶7 We presume that statutes are constitutional. Lee v. Bueno, 2016 OK 97, ¶ 7, 381 P.3d 736, 739. The OWRB has followed the appropriations system since 1993. The statutes are within the State's police powers, and the administrative system that determines water rights of Oklahomans to issue permits is consistent. I would take this opportunity to clarify that Franco-American is not good law. FOOTNOTES 1 60 O.S. § 60. 2 "Oklahoma has employed two different systems for managing the use of natural flowing water: common law riparianism and prior appropriations. The riparian doctrine operates to "confer[] upon the owner of land contiguous to a watercourse the right to the reasonable and beneficial use of water on his land." In contrast, the prior appropriations doctrine does not require a water user to own riparian land and determines rights by appropriation permits acquired on a "first in time, first in right" basis. Evident inconsistencies between the two systems led the Oklahoma legislature to attempt to limit common law riparian rights in promotion of an appropriations system. " Gary D. Allison, Franco-American Charolaise: The Never Ending Story, 30 Tulsa L.J. 1, 59 (1994). 3 Franco-Am. Charolaise, Ltd. v. Okla. Water Res. Bd., 1990 OK 44, 855 P.2d 568. 4 Id. 5 Id. ¶ 2, 855 P.2d at 571. 6 See H. Cole Marshall, Clear As Mud: How Heldermon v. Wright Missed an Opportunity to Clarify Oklahoma's Murky Water Law, 61 Okla. L. Rev. 843 (2008); Gary D. Allison, Oklahoma Water Rights: What Good Are They?,- 64 Okla. L. Rev. 469 (2012). 7 H. Cole Marshall, Clear As Mud: How Heldermon v. Wright Missed an Opportunity to Clarify Oklahoma's Murky Water Law, 61 Okla. L. Rev. 843, 856 (2008). 8 Id. 9 Okla. Admin. Code 785:20-5-4 states: " (a) Elements of statute. Before taking final action on the application, the Board shall determine from the evidence presented whether: (1) Unappropriated water is available in the amount applied for [82:105.12(A)(1)] (as set forth in 785:20-5-5(a) and (b));(2) The applicant has a present or future need for the water and the use to which applicant intends to put the water is a beneficial use. In making this determination, the Board shall consider the availability of all stream water sources and such other relevant matters as the Board deems appropriate, and may consider the availability of groundwater as an alternative source [82:105.12(A)(2)] as set forth in 785:20-5-5(c);(3) The proposed use does not interfere with domestic or existing appropriative uses [82:105.12(A)(3)] as set forth in 785:20-5-5(d); and(4) If the application is for the transportation of water for use outside the stream system wherein the water originates, [82:105.12(A)(4)] the provisions of Section 785:20-5-6 are met."... 10 Allison, supra note 2, at 56 (citing Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1015 (1992) and Keystone Bituminous Coal Assn. v. DeBenedictus, 480 U.S. 470, 497 (1987)).

afb1b543-444e-45a2-81d3-918d38868912

Oil Valley Petroleum v. Moore

oklahoma

Oklahoma Supreme Court

OIL VALLEY PETROLEUM v. MOORE2023 OK 90Case Number: 119810Decided: 09/19/2023OIL VALLEY PETROLEUM, LLC, NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. Plaintiff/Appellant, v. CLAY E. MOORE, an individual, or his Heirs, Executors, Administrators, Trustees, Devisees, Successors, Agents, or Assigns, Defendant/Appellee. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I ¶0 Plaintiff filed a proceeding in the District Court for Dewey County and requested the trial court to quiet title, cancel an oil and gas lease, and declare its top-lease to be in force and effect. Defendant moved for summary adjudication. Plaintiff also moved for summary adjudication. The Honorable Celo J. Harrel, Associate District Judge, granted defendant's motion and denied plaintiff's motion. Plaintiff appealed and the Court of Civil Appeals reversed the judgment of the District Court and directed judgment for plaintiff. Defendant sought certiorari to review the opinion by the Court of Civil Appeals, and certiorari was granted. We hold: (1) Exhibits presented during summary adjudication proceedings were insufficient to show a material fact that a well was commercially profitable for the purpose of the habendum clause of an oil and gas lease; (2) An overriding royalty interest may be extinguished by an extinguishment of the working interest from which it was carved by a lessee's surrender of the lease in substantial compliance with the lease, unless the surrender is the result of fraud or breach of a fiduciary relationship; and (3) Prevailing party status for the purpose of an attorney fee is determined in the trial court when not determined on appeal. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; ORDER OF THE DISTRICT COURT REVERSED; AND CAUSE REMANDED FOR ADDITIONAL PROCEEDINGS Joseph M. Vorndran, Breanne M. Gordon, Stuart & Clover, PLLC, Shawnee, Oklahoma, for Plaintiff/Appellant. Michael Kelly, Long, Claypole & Blakley Law, PLC, Enid, Oklahoma, for Defendant/Appellee on appeal and certiorari. Jana Knott, Bass Law, Oklahoma City, Oklahoma, for Defendant/Appellee on certiorari. Kraettli Q. Epperson, Mee Hoge PLLP, Oklahoma City, Oklahoma, Amicus Curiae. EDMONDSON, J. I. Introduction and Summary ¶1 Plaintiff, Oil Valley Petroleum, LLC, (Oil Valley) and defendant, Clay Moore, (Moore), sought equitable relief in the District Court to adjudicate title based upon two oil and gas leases. Their arguments may be simplified: (1) Oil Valley claims its title is based upon a top-lease and a release by a lessee of its interest in a well; and (2) Moore claims his title is based upon the base or bottom lease and production from that same well, with an added allegation of unclean hands by Oil Valley. Oil Valley claims a release creates a washout of Moore's interests because the released well was the only well keeping the lease in effect during the secondary term of the lease. As we explain, Moore and the amicus curiae use the term "washout" to describe an interest in a lease that is extinguished with an added element of alleged wrongfulness by the person causing the extinguishment. Moore states production from the well kept the lease in effect regardless of the release. ¶2 Amicus curiae on certiorari correctly identifies the issues presented to us by the parties: Whether a lessee's release of a lease may extinguish another's interests in the base oil and gas lease when a claim is made of continuing production holding the lease, and whether this production may be used to show a party's "unclean hands" or constructive fraud in obtaining the release. Amicus curiae indicates a quiet title proceeding is a form of equitable relief, and all circumstances must be considered.1 Moore and amicus curiae appear to argue the fact of production would necessarily show a type of fraud or estoppel relating to a release. However, because elements for fraud or estoppel theories are not identified as such for facts specific to Moore's claim, their argument may also be read as indicating production from the well and conduct of the parties relating to the release are simply two of several factors to be considered supporting a claim in equity to quiet title and cancel an oil and gas lease. We agree that a trial court proceeding in equity must consider all circumstances when parties seek to cancel an oil and gas lease and adjudicate title. ¶3 The parties used a partial summary adjudication procedure for a decision by the trial court. Moore sought and was granted partial summary relief. Although he argued the well was producing, he did not supply facts necessary to show the well was commercially profitable. The fact of commercial profitability was raised and disputed by Oil Valley during the partial summary relief proceedings. Moore's allegation of Oil Valley's unclean hands was not addressed in the summary relief proceedings other than what appears to be a legal conclusion by Moore based upon his allegation the well continued to produce, and that Oil Valley obtained both the top-lease and the release. Moore did not address when facts are sufficient to show unclean hands, estoppel, or a constructive fraud. Oil Valley did not address whether fraud or breach of a fiduciary duty may invalidate a lessee's release of an interest in a lease. ¶4 We may address a trial court's grant of interlocutory summary relief when an appeal is brought from a subsequent judgment.2 The interlocutory order granting movant's motion for partial summary relief occurred when the parties expressly disputed a fact material to the movant's motion, e.g., whether the well was commercially profitable. This order must be reversed. ¶5 The trial court also pronounced a subsequent final order that granted judgment to Oil Valley on a counterclaim raised by Moore. The parties did not supply in the appellate record any of their trial court motions used by the trial court when adjudicating this counterclaim. There is no discussion by the parties whether this final adjudication relied in any part, or to any degree, on the interlocutory partial summary adjudication reversed herein. We do not address the final order. ¶6 Oil Valley sought partial summary relief on the quiet title claim and its request was denied. Oil Valley raised the fact of the release, claimed the well was not producing, and argued Moore was required to commence drilling operations and produce after the release was filed in Dewey County. Oil Valley did not address elements to a claim in equity to cancel an oil and gas lease based upon all of the circumstances in the controversy. Oil Valley does not show on appeal that its request for partial summary relief is within a narrow category of appellate review when a trial court's denial of summary relief is reversed on appeal. ¶7 We hold: (1) Exhibits presented during partial summary adjudication proceedings were insufficient to show a material fact that a well was commercially profitable for the purpose of the habendum clause of an oil and gas lease; (2) An overriding royalty interest may be extinguished by an extinguishment of the working interest from which it was carved by lessee's surrender in substantial compliance with the lease, unless the surrender is the result of fraud or breach of a fiduciary relationship; and (3) Prevailing party status for the purpose of an attorney fee must be determined in the trial court. We also conclude we will not make a first instance adjudication of rights and obligations of parties to a lease and top-lease when the facts were not developed in the trial court equitable proceeding and are not before us in the appellate record. II. First Lease, First Well, Assignments, Release, Second Lease, and Second Well ¶8 Waban Oil Corporation (Waban) executed an oil and gas lease to Athan Inc. (Athan) in 1980. The Athan lease covered a one-half interest in the minerals in and under the SW/4 of Section 24, Township 17 North, Range 14 West of the Indian Meridian in Dewey County, Oklahoma. Athan assigned all of its interest in the Athan lease to Mustang Production Company, approximately two weeks later on March 24, 1980. ¶9 The Ball #1-24 well was drilled to a depth of 9,700 feet, and completed in February 1981 for producing gas and gas condensate. Completion of the well occurred during the three-year primary term in the Athan lease. The Oklahoma Corporation Commission created a 640-acre drilling and spacing unit for Section 24, T17N-R14W, and included the Ball #1-24 well. ¶10 Mustang made two assignments and divided its interest in the Athan lease based upon depth from the surface and also created an override interest. Mustang's first assignment was made in June 1981 to Funk Exploration. Mustang assigned its "right, title and interest" in the Waban Athan lease "from the surface of the earth to the stratigraphic equivalent of 9,747 feet (being the total depth drilled and logged plus 50' ), . . . in the Ball #1-24 well."3 Mustang also reserved a 1/8 of an 8/8 overriding royalty interest in this assignment, and the assignment was made subject to a previous farmout agreement between Mustang and Funk. ¶11 Mustang's second assignment was made approximately ten years later in November 1991 (effective Jan. 1, 1992), by its successor, Mustang Fuel Corporation, to Clay E. Moore (Moore). Mustang assigned "all of Assignor's interest" created by "lessor Waban Oil Corporation" (i.e., the Athan lease), excluding rights to wells and wellbore rights retained by the assignor.4 In summary, Mustang assigned both (1) its remaining interest in Waban's Athan lease below the stratigraphic equivalent of 9,947 feet, and (2) Mustang's remaining 1/8 overriding royalty interest. ¶12 Mustang's first assignment with its assignment of shallow rights5 to Funk Exploration in 1981, i.e., "from the surface of the earth to the stratigraphic equivalent of 9,747 feet including the Ball #1-24 well, was subsequently possessed by Staab Holdings, LLC, (Staab), "as successor to Funk."6 In October 2017, Staab executed, but did not file, a "Release of Oil and Gas Lease" for "all of its rights, title and interest in and to the oil and gas leases hereinafter described;" and then described Waban's lease to Athan and one additional lease. Staab's release was filed in the Dewey County records on March 5, 2018.7 ¶13 In June 2017, Waban, as lessor, executed a second oil and gas lease for property described in the Athan lease. The lessee is plaintiff, Oil Valley Petroleum, LLC (Oil Valley). Both Moore and Oil Valley view this second lease as a "top-lease" when it was executed in June 2017. A "top-lease" is a lease subject to a pre-existing lease that has not expired,8 and the parties agree the Athan lease was in effect the date the top-lease was executed. ¶14 Based on Oil Valley's subsequent actions, the Corporation Commission granted a drilling permit for the Holsapple #1-24-13XH well (Holsapple Well) to Council Oak Resources, LLC (Council Oak). The permit to drill was granted on May 21, 2018, and this well was completed at a vertical depth of 11,524 feet. ¶15 The parties agree the lease and assignments occurred, that a release was filed, and a top-lease was created. However, this agreement appears to be partially inconsistent with part of Moore's argument during the partial summary adjudication proceedings which referenced "other working interest owners" in the Ball #1-24 well. The parties disagree on the effect of the March 2018 release on the 1980 Athan lease, e.g., whether Moore's rights were extinguished by the release. III. District Court Proceedings, Appeal, and Certiorari ¶16 In July 2018, Oil Valley filed this proceeding in District Court of Dewey County to quiet title in its favor, cancel the Athan lease, and declare the second lease by Waban, the June 2017 top-lease, to be in full force and effect. The controversy is between Oil Valley claiming rights pursuant to the release by Staab and the top-lease, and Moore claiming rights below the stratigraphic equivalent of 9,947 feet based upon the Athan lease, an assignment to him from Mustang, and production from the Ball #1-24 well. ¶17 Moore requested "summary judgment" on the quiet title issue concerning the continued effect of the Athan lease and on the "present effect" of the top-lease. Moore argued the Ball #1-24 Well "is and has been continuously producing and/or capable of producing in paying quantities since completion through November 2018."9 The motion refers to attached Exhibit "E" purporting to show recent production with a reporting date of "5/2018," and attached Exhibit "F" a January 2019 revenue disbursement statement showing a payment to Moore from an operating company based upon production for the last quarter of 2018 based upon Moore's interests in three different wells. ¶18 Exhibit "F" shows a value of $24.91 attributed to Moore's override in the Ball #1-24 well during November 2018, and a check paid to Moore in the amount of $145.87 for production from three wells which included the Ball #1-24. However, Moore also attached Exhibit "G" with information from the Oklahoma Tax Commission's PUN form (Production Unit Number form) to show production from the Ball #1-24 well. The PUN form for the well in 2018 shows production in January, March, and May of 2018, but no production during the last seven months of 2018. Moore's Answer in the District Court pled that Golden Gas Service Company is the operator of the Ball #1-24 well, and Moore's motion for summary relief states he has received "remittance advices from DCP Operating Company, LP" for production as recent as November 2018. ¶19 Oil Valley responded and also sought "summary judgment" on the quiet title issue of the Athan lease and the top-lease. Oil Valley argued Staab's release caused Moore's interest to be "completely extinguished pursuant to the express terms of the original oil & gas lease from which his interests' validity depended."10 Further, that Moore's deep leasehold rights from the Athan lease were undeveloped,"were held by production from the Shallow Rights, [and] when gas production from the Lease ceased (via the Release), it effectively nullified the entire [Athan] Lease."11 ¶20 In addition to invoking the Athan lease's surrender clause, Oil Valley made an additional three arguments. The first two are: (1) The terms of the Athan lease's habendum clause required a well to be capable of production "by the lessee" which did not continue after the release was filed; and (2) The Athan lease contains a drilling and reworking sixty-day cessation of production clause by a lessee for keeping the Athan lease in effect, and no further drilling or reworking activity occurred pursuant to the Athan lease prior to and after the release. In other words, Staab's release of the Athan lease's "shallow rights" with its Ball #1-24 well caused the following results: (1) No Athan lessee continued production pursuant to the lease's habendum clause; and (2) No Athan lessee, including Moore as to his deep rights, satisfied the cessation of production clause to preserve the Athan lease by commencing drilling in the 60-day period after Staab's release was filed. In summary, Oil Valley argued the top-lease ripened or became effective after this 60-day post-release period without commencement of production by a lessee on the Athan lease. ¶21 A third argument by Oil Valley was Moore failed to produce any facts concerning the costs associated with production from the Ball #1-24 well. Oil Valley agreed Moore had received $24.91 from production in November 2018. Oil Valley pointed to Moore's deposition stating he had not reviewed "any expense information from the Ball #1-24 Well." Oil Valley argued Moore's motion for summary judgment failed to address profitability of the Ball #1-24 well, and that production in paying quantities for the purpose of the Athan lease means, in part, production must be in paying quantities for cost-bearing interests. In other words, a lease-based obligation of owners of working interests to produce must include whether an ability to create a profit exists. ¶22 Moore replied and argued information submitted showing a "record of production" showed the well was capable of producing in paying quantities. The reply did not point to any exhibit showing costs associated with the Ball #1-24 well or its profitability. Moore stated in his deposition he had been informed that the well was a "profitable well" when he telephoned an operator for an opinion. ¶23 Moore's reply argued the Staab release had the effect of releasing only one part of the Athan leasehold: "A voluntary release of a small portion of the acreage, or an individual formation, could have no effect on all the other acreage and all the other formations which had become subject to the continuing production clause of the Lease."12 ¶24 Moore also argued the other operator and other working interest owners in the Ball #1-24 well continued to produce from the well, "which would continue to hold the Athan Lease."13 Generally, the phrase "working interest" "unequivocally implies the right to 'work' or do the things necessary to producing, the lease and helps distinguish such an interest from one which does not carry with it that right."14 A working interest is one of those rights usually created as part of a cluster of rights granted to a lessee in an oil and gas lease. For example, the lease "does not operate as a conveyance of oil and gas in situ but constitutes merely a right to search for and reduce to possession such of these substances as might be found . . . it is really a grant in praesenti of oil and gas to be captured in the lands described during the term demised and for so long thereafter as these substances may be produced."15 Moore makes his reference to other working interest owners with a reference to "the other operator." These references are not accompanied with facts showing whether the operator and other working interest owners possess interests based upon (1) privity of estate arising from the Athan lease, or (2) privity of contract arising from some type of operating agreement or other contract, or (3) both privity of estate and privity of contract.16 ¶25 Moore's reply also states several additional facts not supported by any exhibits. Moore states the following. The "facts" are that . . . D. When Oil Valley obtained a release of the Athan shallow leasehold rights from Staab in October, 2017, it did not "automatically" release the Deep Rights held by Moore, as Staab had no interest in nor power to release rights he did not own. . . F. Staab's release of only its rights in the Athan lease, which was only in the Southwest Quarter, had no effect on Staab's and any other party's rights in the rest of Section 24, nor on the rights of those other lessees to continue producing from the Ball 1-24 wellbore on the Southwest Quarter, and thus maintain all leases in Section 24 in force. Moore's Reply on summary adjudication at.5. The argument references "other lessees . . . producing from the Ball 1-24 wellbore," but does not tie this language to a stated identifiable interest arising from the Athan lease. Moore states this production continued "through at least November 2018, which was several months after the new Holsapple well was commenced in May, 2018, on section 24."17 ¶26 Moore and Oil Valley filed supplemental briefs on the effect of Staab's release on Moore's interests. Moore relied on a 1974 opinion from the Louisiana Supreme Court and a 2015 opinion from an Ohio appellate court.18 Oil Valley relied on a 2004 opinion from the Texas Supreme Court and a 1995 appellate court opinion from Texas.19 ¶27 The trial court granted Moore's motion for summary judgment, and denied Oil Valley's motion for summary judgment. Moore's Answer included a counterclaim to quiet title, and damages for slander of title and tortious interference with business relations. The trial court's adjudication in July 2019 on Moore's summary judgment motion did not expressly include his claims for damages. ¶28 In August 2021, the trial court denied Moore's "motion for partial summary judgment" on his claim for tortious interference with business relations. The trial court also granted Oil Valley's "counter motion for summary judgment" on Moore's claim for tortious interference with business relations. Motions, if any, specifically addressing slander of title or tortious interference are not included in the record on appeal, and we do not review the August 2021 order granting Oil Valley's counter motion. ¶29 Oil Valley appealed. The Court of Civil Appeals reversed the judgment of the trial court, and concluded the trial court should have granted Oil Valley's motion for summary judgment. Moore filed a petition for certiorari to review the opinion by the Court of Civil Appeals, and the petition was granted. ¶30 Moore's petition for certiorari asserts: (1) Moore's "deep rights" were preserved by production from the Ball #1-24 well pursuant to the habendum clause in the Athan lease; (2) The Staab Release "had no legal effect on his [Moore's] interests" as to both his override interest in the Athan lease and his "Deep Rights;" and (3) Even assuming Staab's release did destroy Moore's override and deep lease rights in the Athan lease, the appellate court allegedly made an improper finding of fact concerning the Athan lease's cessation of production clause because "the District Court did not determine whether the 'continuous drilling clause had even been triggered in the case because the lower court concluded that Staab's release of the shallow rights did not release Moore's interests because Moore's interests continued to be held by production." ¶31 Oil Valley's answer to the certiorari petition discusses the nature of Moore's interests, the habendum clause, and Staab's release. Oil Valley construes the appellate opinion's reference to additional drilling as a comment on Moore possessing a right to drill to the formation depth Moore possessed under the Athan lease after the Staab release was filed, provided Moore complied with a continuous drilling clause in the Athan lease. Oil Valley's answer on certiorari also asserts that after Staab's release was filed "[a]ny further production from the Ball 1-24 well was produced pursuant to Oil Valley's Top Lease." ¶32 Moore's reply on certiorari objects to Oil Valley asserting "as a material fact" that "'[i]mmediately upon Staab's filing of the Release of Oil & Gas Lease' on March 5, 2018, 'all production ceased from the Ball #1-24 well pursuant to the Base Lease." Moore states this "is a misstatement of basic oil and gas principles" as opposed to a statement of fact. Moore argues the cessation of physical production from the well was required to commence the effect of the 60-day continuous drilling clause. ¶33 Amicus curiae filed a brief in support of the petition for certiorari and argues a washout of an overriding royalty interest should be protected from constructive fraud. IV. Standard of Review ¶34 Our review of an order granting an interlocutory partial summary adjudication upon appeal of the subsequent judgment is similar to our review of a motion for summary judgment, and we examine the trial court submissions actually used by the parties and the trial court to adjudicate the motion.20 A motion for summary judgment may be used in a proceeding in equity,21 and a partial summary adjudication, often known in trial court parlance as a "motion for partial summary judgment," may be used in equity. Oil Valley's quiet title claim and Moore's quiet title counterclaim presented by opposing motions for partial summary adjudication invoked the trial court's equitable cognizance.22 ¶35 When a trial court's summary judgment is based upon an issue of law adjudicating the meaning of contractual language, then we exercise a de novo appellate review of an assignment of error challenging the trial court's legal conclusion.23 The partial summary relief granted to Moore was based upon language in the lease construed as an issue of law by the District Court. The partial summary relief granted to Moore receives a de novo appellate review on an issue of law.24 ¶36 Oil Valley argued a material fact was missing from Moore's partial summary adjudication motion which sought to enforce the habendum clause, e.g., Oil Valley argued the fact of profitability from production was not raised by Moore in his request for summary adjudication. Moore, as a moving party granted summary adjudication, had a burden to establish that no dispute as to a material fact existed.25 The moving party for summary adjudication presents an issue of fact as undisputed, and the "opposing litigant must then identify those material facts he or she alleges remain in dispute and tender supportive evidentiary materials."26 Oil Valley's approach to this issue is that its burden to produce facts and refute profitability of the well on summary judgment does not arise until Moore as movant satisfies his initial burden to show profitability of the well as a fact necessary to Moore's cause seeking to enforce the habendum clause against Oil Valley. ¶37 Summary judgment is an adjudication on the merits of the controversy.27 A summary judgment is based upon a determination that all elements of the moving party's cause of action are present.28 The absence of a single element in the moving party's cause of action is sufficient defense to the motion.29 Elements of a cause of action adjudicated by summary process must be supported by those facts material to those elements; and "a fact is material if proof of that fact would have the effect of establishing or refuting one of the essential elements of an adjudicated cause of action or defense asserted by the parties."30 An adjudication defining the elements to a particular cause of action presents a question of law.31 Whether production profitability is an element for enforcement of the habendum clause presents a question of law and receives de novo appellate review. ¶38 An oil and gas lease is construed as a contract.32 We give effect to the plain and ordinary meaning of words unless a technical term is used to convey a specific technical concept.33 We follow the parties' intent from the four corners of the instrument at the time the contract was executed,34 in light of the applicable law incorporated into the contract.35 We construe an oil and gas lease to give effect to the intent of the parties and effectuate the purpose of contract actually made.36 ¶39 The trial court both granted and denied requests for partial summary adjudication. The denial of a motion for summary judgment is generally not appealable, including after a trial on the merits, except in certain circumstances where a judgment on a cause of action is required as a matter of law.37 Oil Valley argued judgment must be denied to Moore and granted to Oil Valley in the appeal due to a single issue law, e.g., the legal effect of a lessee's release of an interest in an oil and gas lease. We conclude Oil Valley's claim in equity does not rest upon a single issue of law requiring a judgment in appeal on its quiet title clam. V. Analysis V(A). Partial Summary Relief Granted to Moore ¶40 In summary, Moore argued his overriding royalty interest in shallow zone production from the Ball #1-24 well and his assigned interest in a deeper zone continued in effect, or were "held," by the production from this well. Moore relied upon the habendum clause in the Athan base lease ¶41 The phrases "base lease" or "bottom lease" are often used to identify an earlier oil and gas lease which controls or defines oil and gas rights in subsequent conveyances involving the same leased premises.38 Generally, an assignment of lease rights creates no greater interest for the assignee than the interest possessed and assigned by the assignor.39 The parties agree the 1980 Athan lease is a base lease for subsequent conveyances of rights based upon the rights conveyed by the Athan lease. ¶42 The Athan lease contains a clause stating the lease will remain in force for three years as the primary term, and as long thereafter oil and gas or either of them is produced by the lessee. This language specifies a primary term with a habendum clause. The phrases "primary term" and "habendum clause" have well-known meanings in our jurisprudence. ¶43 One court has explained an incomplete but useful definition for a "primary term" as the period of time stated in the lease "during which the lease may be kept alive by a lessee by virtue of drilling operations or the payment of rentals, even though there is no production in paying quantities, . . . [and] is also a period of time at the end of which the estate granted will terminate but which estate may be extended by some other provision, usually one for production."40 In Hall v. Glamor, 2018 OK 59, 427 P.3d 1052, we noted the habendum clause in an oil and gas lease defines the lease's primary term and usually extends the lease for a secondary term of indefinite duration as long as oil, gas, or other minerals are being produced.41 After the primary term, a lease is effective based upon a well capable of production in paying quantities such that the lease remains viable under the habendum clause, which defines the duration of the lease in relation to the production life of the well. Id. 2018 OK 59, ¶21, 427 P.3d at 1063. ¶44 In Rist v. Westhoma Oil Co., 1963 OK 126, 385 P.2d 791, we explained if a base lease does not distinguish among formations and depths, and subsequent conveyances create in different parties different shallow and deep rights relating to that base lease, then "delay rentals paid by the owners of the above-sea level leasehold served to extend the lease year to year during the primary term as to all horizons." Id. 385 P.2d at 796. We explained the parties entered into a lease agreement for a primary term "to be extended on production" from the area described "with no thought in mind of a severance as to horizontal divisions." In summary, if one lessee performed a lease-created obligation towards the lessor which continued the life of a base lease between lessor and lessee as to one lessee of a horizontal interest; then a second lessee possessing a different horizontal interest could rely on the first lessee's performance to preserve the life of the base lease as to the second lessee. ¶45 Several years later in 1982, we addressed circumstances where a mechanical difficulty caused a cessation of production and then a second well drilled to the same formation continued production. State ex rel. Commissioners of the Land Office v. Amoco Production Co., 1982 OK 14, 645 P.2d 468. We expressly agreed with the reasoning in Amoco Production Company v. Braslau, 561 S.W.2d 805 (Tex.1978), where a mechanical difficulty caused a casing collapse inside the well bore, and a second well was drilled, "even drilled to a different formation, kept the lease alive." State ex rel. Commissioners v. Amoco Production Co., 645 P.2d at 471. ¶46 A few years later our Court of Civil Appeals relied on Rist in Martens v. Kaiser--Francis Oil Co., 1989 OK CIV APP 3, 768 P.2d 383, and explained if a lease does not distinguish among horizontal formations and depths, a well drilled in a unit of production and the leased premises in one formation will satisfy the lessor-lessee obligation to produce as to other horizontal formations in the same leased premises developed as a unit. We recently noted in Hall v. Glamor, supra, the application of 52 O.S. §87.1(b), (a statutory Pugh clause), and its 1977 amendment for spacing units 160 acres and greater meant "leased lands lying outside of the drilling and spacing unit would no longer be held by production over ninety days beyond the expiration of the primary term of the lease," and this statutory change was a departure from the previous law.42 ¶47 Both parties agree that satisfaction of a base lease habendum clause by production from one formation in a leased premises by a lessee may satisfy the base lease habendum clause as to another formation in the same leased premises. Oil Valley asserts Moore's overriding royalty interest and deep rights interest could be held by production from the shallow Ball #1-24 well, but could not be held by that well after the release was filed by Staab. The parties do not expressly discuss if Moore had a duty to Athan to develop the deeper zones between January 1, 1992, and the date Staab's release was filed twenty-six years later on March 5, 2018. However, one of Moore's arguments appears to indicate Oil Valley's Holsapple Well satisfies Moore's duty. Predictably, Oil Valley states the Holsapple Well was not drilled by Moore, as a lessee by assignment, and the well satisfies no duty owed by Moore arising from the Athan lease. Oil Valley also asserts any production from the Ball #1-24 well after the date of release was filed is deemed to be production by Oil Valley from the well pursuant to the top-lease. ¶48 Both parties agree satisfaction of the Athan lease habendum clause by production from one formation in a leased premises satisfies the base lease habendum clause as to another formation in the same leased premises. This agreement concerning the Athan lease does not contravene public policy on the basis of Rist v. Westhoma Oil Co., supra, and is part of this controversy as shaped by the parties for our review.43 We agree with the parties that production from the shallow well could hold or preserve Moore's rights in the Athan lease. However, Oil Valley objected to Moore's use of the habendum clause for a summary judgment without Moore showing the Ball #1-24 well was commercially profitable. We agree that keeping the base lease viable by the habendum clause is not by mere production, but a commercially profitable production which is often referred to as "production in paying quantities." ¶49 In Pack v. Santa Fe Minerals, 1994 OK 23, 869 P.2d 323, we quoted from Hoyt v. Continental Oil, 1980 OK 1, 606 P.2d 560, and noted "our commitment 'to the principle that production means production in paying quantities in Oklahoma when the term appears in the habendum clause of an oil and gas lease.'" Pack, 1994 OK ¶23, 869 P.2d at 323. In Mitchell v. Amerada Hess Corp., 1981 OK 149, 638 P.2d 441, we discussed an operator's lack of a duty to drill an additional well after paying production is obtained, a prudent operator expecting a probability of potential profit, and one purpose for an oil and gas lease is "to make the extraction of oil and gas from the leased lands of mutual advantage and profit to the lessor and lessee." Id. 638 P.2d at 448-50 (emphasis added). In Tres C, LLC v. Raker Resources, LLC, 2023 OK 13, 532 P.3d 1, we discussed a time period over which profitability on an oil and gas lease should be determined. Id. 2023 OK 1, ¶¶30-31, 532 P.3d at 17-18. We have explained a well's profitability is an element to a cause of action seeking to construe and apply the habendum clause in an oil and gas lease with an active well, and capability of profit for production is an element when construing a cessation of production clause with a shut-in well.44 ¶50 Moore supplied an exhibit showing a value of $24.91 attributed to Moore's override in the Ball #1-24 well during November 2018. We have explained an overriding royalty interest is such that only when oil and gas are reduced to possession does the interest attach, and "prior to this event the owner of an override has no assertable right in the leasehold."45 An overriding royalty interest is often defined as: "a certain percentage of the working interest which as between the lessee and the assignee is not charged with the cost of development or production,"46 and argument relating to when a cost may be charged to on overriding royalty has not been made by any party.47 ¶51 The payment of $24.91 for Moore's overriding royalty interest, by itself, does not show the well's commercial profitability. Moore also supplied additional documentation showing production. However, this documentation was not placed in any economic context regarding cost of production, and nothing before the trial court shows profitability of the well. Additionally, two of the exhibits presented by Moore, "F" and "G" appear to conflict on whether production last occurred in either May or November 2018. ¶52 We have also explained a well must be capable of producing in paying quantities, and "the viability of a mineral-interest lease depends largely upon whether a well is capable of production in paying quantities, i.e., the characteristic that distinguishes a 'shut-in' well from a well experiencing a 'cessation of production.'"48 If an issue of fact is whether a well is capable to produce in paying quantities or be profitable; then the trial court must make that determination of fact.49 Moore pled the Ball #1-24 well was capable of producing commercial quantities, but did not provide the factual elements necessary to show this claim in his request for summary relief. ¶53 In summary, the fact of the well's commercial profitability was a material fact for Moore's claim he presented for summary relief against Oil Valley, and the fact was disputed by the parties during the partial summary relief proceedings. For example, Oil Valley argued "neither Plaintiff, nor the Defendant, can accurately plead or assert whether the Ball 1-24 produces and/or is capable of producing in paying quantities at this time."50 Partial summary relief granted to Moore was error when a material fact to an element for his cause of action adjudicated was not shown and was also disputed. We reverse the partial summary adjudication granted to Moore. V(B). The Release ¶54 Oil Valley argues it does not matter to Moore's equitable claim whether the Ball #1-24 well was profitable or capable of being commercially profitable. Oil Valley argues Staab's release extinguishes Moore's overriding royalty interest as well as Moore's deep rights as a lessee in the Athan lease. Moore disagrees. Oil Valley and Moore argue the dispositive issue on appeal and certiorari is which of two events takes precedence for title purposes, (1) a producing well as argued by Moore, or (2) a lessee's release as argued by Oil Valley. ¶55 Oil Valley argues Moore has no claim in equity. Oil Valley is mistaken. We have reaffirmed for several decades a party possessing an overriding royalty may challenge a surrender or release when alleging in an equitable proceeding the release or surrender was a result of fraud or a breach of a fiduciary duty. ¶56 Amicus curiae argues the dispositive issue of law in the appeal and on certiorari is whether a lessee in a base lease may file a release of those rights and extinguish an overriding interest and other working interests in the base lease if circumstances of the release constitute a constructive fraud in equity. ¶57 The term "washout" may be used to refer to extinguishing a nonoperating interest, such as an overriding royalty, by another's surrender or release of a lease. However, the term is often used when a party intentionally surrenders the lease and then reacquires the same lease free of the nonoperating interests which are "washed out" by the surrender.51 For example, one court has explained: "The intentional termination of a lease to destroy a nonoperating interest is a washout tactic. A washout is conduct by an operator designed to extinguish the overriding royalty interest while at the same time preserving the operator's interest."52 One author has stated that in addition to overriding royalty interests, "washouts can happen to any type of non-operating interest in an oil and gas lease, such as a back-in option, net profits interest, security interest, or a non-operating working interest."53 ¶58 For several decades, including a time prior to Moore obtaining his assignment, model operating agreements for those possessing an operating interest have often included provisions for abandonment and surrender of a lease as well as renewal or extension of a lease to prevent a washout.54 Texas courts have stated a washout of an interest may be prevented by the instrument that created the interest, usually by some type of express "anti-washout" clause,55 and have also stated the owner of the overriding royalty has the burden to include language protecting against a washout.56 Similar language indicating the availability of contractual extinguishment protection is found in Rees v. Briscoe, 1957 OK 174, 315 P.2d 758. One party expected the opposing party to protect a reserved override when new leases were created, and the Court noted "it would have been easy to have added a few words to the effect that the reservation [of the override] should apply to renewals or extensions of the leases assigned." Id. 315 P.2d at 761 (explanation added). Some courts have viewed a washout as not necessarily wrongful and prohibited by an oil and gas lease, but should be prohibited by express anti-washout provisions if desired by the parties. ¶59 A typical analysis of a washout in the absence of an anti-washout agreement includes an examination of the relationships of the parties to their interests and each other, e.g., the party surrendering a lease, the party whose interests are washed out, and the party obtaining an interest due to the washout. This analysis often examines whether parties possessed a fiduciary or confidential relationship. The analysis may also include whether a release, surrender, or forfeiture was obtained by fraud or collusion when circumstances for such are raised as an issue for adjudication by a party.57 Amicus curiae uses the term "washout" to describe conduct which is allegedly a constructive fraud, and Moore uses the term "estoppel," but they do not identify elements for a constructive fraud or estoppel claim within the context of the well-known "fraud or breach of a fiduciary relationship" exception for saving an overriding royalty from a lessee's surrender of a lease as noted herein. The parties may address this on remand with an opportunity to present all of the circumstances necessary for their competing claims in equity. ¶60 Moore pled he possessed two very different oil and gas interests, an overriding royalty interest in the Ball #1-24 well and assigned lessee rights in the Athan lease below the stratigraphic equivalent of 9,947 feet. The two interests must be addressed separately when examining a transaction that extinguishes interests created by a lease. ¶61 The nature of an overriding interest has often arisen in litigation involving implied covenants. In XAE Corp. v. SMR Property Management Co., 1998 OK 51, 968 P.2d 1201, we stated the following. This Court has said that, unless expressly assumed, implied covenants of an oil and gas leases do not extend to lease assignments with reservation of overriding royalty interest. Kile v. Amerada Petroleum Corp., [1925 OK 1006] 247 P. 681 (1925). We said that unless the contract of assignment imposed rights and obligations on the party the same as that of lessor and lessee, such relationship would not be implied. We declined to apply an implied covenant to protect against drainage in favor of an overriding royalty interest owner. We said that to hold the fundamental provisions in leasing contracts to be implied in the contract of assignment would be to stretch the rule beyond legitimate bounds where there was no express agreement in the contract that could form the basis of relief for the breach of an implied obligation. We said that such owner was limited to the terms of the assignment itself and that where there was no express obligation to drill or produce, no covenant would be implied. Id. 1998 OK 51, ¶11, 968 P.2d at 1204. In XAE, various implied covenants arising from an oil and gas lease did not apply to an overriding royalty interest "unless the contract of assignment imposed rights and obligations on the party the same as that of lessor and lessee." XAE concludes no implied covenants, including a covenant to produce, could be possessed by an overriding interest unless imposed by the contract of assignment. ¶62 Moore does not point to any language in (1) his assignment from Mustang Fuel Corporation for the creation of a obligation owed to Moore that would prevent a extinguishment by conduct of either working interest owners in the Ball #1-24 well or Oil Valley, or (2) any agreement creating an anti-washout right for Moore with respect to these working interest owners or Oil Valley. ¶63 Moore does not argue an implied anti-washout covenant arises from the Athan lease. However, his interpretation of the Athan lease during partial summary adjudication proceedings indicates a view that the habendum clause: (1) Gives the clause the effect of an anti-washout provision by making the Athan lease's release clause subservient to the habendum clause; or (2) Makes production satisfying the habendum clause sufficient to make a surrender of the lease a factual circumstance which necessarily results in fraud or a breach of a fiduciary duty, and that such is a wrongful extinguishment. ¶64 XAE also noted the following concerning the possessor of an overriding royalty interest which is lost or extinguished. The nature of an overriding royalty interest is such that it attaches only when oil and gas are reduced to possession. Before this, the owner of an overriding royalty has no assertable right in the leasehold and the vesting of such owner's rights are dependent upon the happening of a future event or condition. De Mik v. Cargill, 1971 OK 61, 485 P.2d 229. In De Mik we held that an overriding royalty was lost upon renewal of the oil and gas lease because, absent fraud or breach of a fiduciary relationship, the interest did not continue and attach to subsequent leases secured in good faith by the lessee. Id. 1998 OK 51, ¶24, 968 P.2d at 1207 (emphasis added). This language states an overriding royalty is lost or extinguished upon renewal of an oil and gas lease because "absent fraud or breach of a fiduciary relationship, the interest did not continue and attach to subsequent leases secured in good faith by the lessee." Id. Our explanation in XAE relied upon De Mik v. Cargill, 1971 OK 61, 485 P.2d 229, 58 A.L.R.3d 1042, where we stated the following. [A]n overriding royalty may be lost entirely by expiration of the primary lease since, absent fraud or breach of fiduciary relationship, the interest does not continue and attach to a subsequent lease secured, in good faith, by the lessee. . . Neither does an overriding royalty survive cancellation, surrender, abandonment resulting from diminution of production beyond economic feasibility, nor total failure to secure production in paying quantities. Id. 485 P.2d at 233 (emphasis added). This language in De Mik agrees with language we used in Thornburgh v. Cole, 1949 OK 167, 207 P.2d 1096, where we relied on the California Supreme Court in La Laguna Ranch Company v. Dodge, 18 Cal. 2d 132, 114 P.2d 351, 135 A.L.R. 546 (1941), and explained an overriding royalty interest was lost or "extinguished" by the lessee surrendering the lease when quit-claiming to the lessor, unless extinguishing the override was prevented by the instrument that created the override. Thornburgh, 207 P.2d at 1100. We explained this extinguishment of the override occurred in La Laguna Ranch Company "because the agreement did not provide that the overriding royalty should apply to renewal, extension or modification of the lease." Id. ¶65 In summary, our opinions spanning several decades in XAE, De Mik, Thornburgh, and Kile explain an overriding royalty interest being lost or extinguished when the lessee's working interest that was used to carve out the override was itself lost or extinguished. These opinions indicate an overriding royalty extinguished by extinguishing its related working interest is not within the traditional class of constructive frauds when these frauds are defined by the nature and subject of the transaction itself.58 Again, an exception to extinguishing an override was noted in XAE and earlier opinions when the "overriding royalty was lost" because of "fraud or breach of a fiduciary relationship." XAE, 1998 OK 51, ¶24, 968 P.2d at 1207. ¶66 Amicus curiae raises the issue of "constructive fraud" occurring with extinguishing an override, such as a lessee's release of a lease. We have explained a constructive fraud "is a breach of either a legal or equitable duty, [and] does not necessarily involve any moral guilt, intent to deceive, or actual dishonesty of purpose ... [and] may be defined as any breach of a duty which, regardless of the actor's intent, gains an advantage for the actor by misleading another to his prejudice."59 We have discussed a defendant's duty as a required element in a fraud claim,60 and this definition of constructive fraud requires duty as an element: "a breach of a legal or equitable duty." Moore does not explain how this duty he seeks to impose on lessee could be consistent with our explanations that "the owner of an overriding royalty has no assertable right in the leasehold and the vesting of such owner's rights are dependent upon the happening of a future event or condition," and attaching "only when oil and gas are reduced to possession." ¶67 Amicus curiae challenges a lessee's release and asserts: "The owner of a lease does have certain obligations which the owner of overriding royalty may enforce. For example, the owner of the lease may not surrender a producing lease and thereby destroy the overriding royalty"61 We explained in Krug v. Helmerich & Payne, Inc., 2013 OK 104, 320 P.2d 102, that our prior opinions could not support a general proposition that Oklahoma law recognizes a fiduciary duty between lessors and lessees in an oil and gas lease. Id. 2013 OK 104, n. 7, 320 P.3d at 109. The argument by amicus curiae appears to state the fact of production creates a duty by the lessee to not surrender the lease. ¶68 Oil Valley was not a lessor or lessee in the Athan lease. Amicus curiae makes a claim Staab breached a duty to Moore when Staab made the release. Then amicus curiae makes Oil Valley a part of duty being breached by both Waban and Staab by alleging Oil Valley conspired with Staab and Waban. Amicus curiae's argument is that allowing a release when a well is commercially profitable allows "a lessor [Waban] and partial lessee [Staab] to conspire (constructive fraud) to eliminate an outstanding recorded real property interest to the detriment of the title holder (the Deep Rights and an ORRI carved from the Base Lease) contrary to the terms of the Base Lease."62 ¶69 Of course, constructive fraud is well-known and may arise in various contexts, including a real estate transaction when a party's conduct shows "unclean hands" in the transaction.63 Any real estate transaction could potentially involve a constructive fraud based upon a party's conduct involving the breach of a legal or equitable duty. Similarly, a lessee's mere release or surrender of interest in an oil and gas lease is not intrinsically constructive fraud. ¶70 Amicus curiae's argument is based upon a fact not shown in the record on appeal. Amicus curiae seeks an adjudication and explanation of duties and obligations of lessors, lessees, and others acting with them when a lease is held by production in commercially paying quantities. We have explained the record in this appeal does not show the Ball #1-24 well was commercially profitable in paying quantities. Adjudicating whether Moore's override was improperly extinguished due to the presence of a fraud or a breach of a fiduciary relationship and based upon the fact of production in paying quantities when the record does not state whether this fact exists, would make our pronouncement an improper advisory opinion.64 ¶71 Oil Valley's response to amicus curiae states allegations of "conspiracy and/or constructive fraud" were not "directly asserted" by Moore, but "Appellee [Moore] raised similar arguments with their [sic] causes of action for slander of title and tortious interference with a business relationship, however the trial court granted Appellant's motion for partial summary judgment with regard to these claims."65 Oil Valley objects to amicus curiae raising and discussing constructive fraud. ¶72 Moore's answer to Oil Valley's petition alleges the latter had "unclean hands" and an allegation Oil Valley's claims were "precluded by principles of equity, equitable considerations and the abhorrence of forfeitures." Moore pleads legal conclusions of estoppel, quasi-estoppel, and judicial estoppel in answer to Oil Valley's petition. Moore also alleges Oil Valley's conduct was "misleading" and "maliciously seeking to have other working interest owners having an interest at shallower depths . . . release their interest(s) to the detriment of Moore;" and these claims are made as part of Count III, a slander of title counterclaim, and then incorporated by reference in Count IV, a tortious interference counterclaim. ¶73 Oil Valley's argument in an equitable proceeding is that Moore made specific allegations alleging improper behavior by Oil Valley in Moore's Answer in Count III, and then incorporated into Count IV; but Moore failed to incorporate them in earlier Count II, the quiet title counterclaim. Oil Valley's argument is similar to former practice when a bill in chancery was subject to attack because a fact was pled in one part of the bill and not another.66 Statements in a pleading may be adopted by reference in a different part of the same pleading.67 Instead of a more typical objection that an opposing party has incorporated too many allegations in a pleading,68 Oil Valley argues Moore incorporated too few allegations in the proper part of the pleading for his quiet title claim. ¶74 We have stated: "The general philosophy of the Pleading Code is that pleadings should give fair notice of the claim."69 Trial court procedure distinguishes facts for various types of judicial treatment based upon the method a party uses for judicial cognizance of the particular fact, e.g., in a pleading, in a list of disputed or non-disputed facts in a motion for summary judgment, and testimony. Oil Valley's issue is whether it received "fair notice" of Moore's quiet title claim based on "unclean hands" for the purpose of the scope of issues properly addressed by amicus curiae. ¶75 We agree an amicus curiae is not allowed to expand a record on appeal or the issues raised in the trial tribunal.70 The terms "fraud" and "constructive fraud" do not appear as legal conclusions in Moore's answer to Oil Valley's petition. ¶76 Some courts have stated the basis for equitable estoppel may include fraud,71 and some explain fraud is not necessarily required for an equitable estoppel to be applied.72 In some courts, the term "fraud" may not expressly appear in the pleading as a conclusion, but if "the facts from which that conclusion necessarily follows" are alleged, then they are sufficient to raise an estoppel constituting a "fraud in some form that is essential" to the cause of action pled.73 We have stated circumstances surrounding fraud must be pled with sufficient particularity to afford an opponent adequate notice to prepare a responsive pleading.74 ¶77 Whether Moore properly pled circumstances of an estoppel or a constructive fraud was not addressed in the trial court, in part because of the unusual procedure used by both Moore and Oil Valley with each seeking an adjudication of a title in equity by a single alleged fact; and then seeking an appellate review whether a single fact was sufficient to create a title and cancel an oil and gas lease. For Oil Valley's argument, the alleged fact of a lessee's release, once proven, meant it should be awarded title. For Moore's argument, the alleged fact of continued production, once proven, meant he should be awarded title. We conclude that the arguments raised by amicus curiae do not impermissibly expand the scope of issues raised in this controversy by the parties. ¶78 The Athan lease provides in part the following: "Lessee may at any time and from time to time surrender this lease as to any part or parts of the leased premises by delivering or mailing a release thereof to lessor, or by placing a release of record in the proper County." We have explained a surrender or release of a lease in substantial compliance with the terms of the lease will be given effect.75 We have also explained a lessee's interests in a lease may be extinguished with a surrender by delivery to a lessor or filing on the record in the proper county when allowed by the terms of the lease.76 ¶79 Oil Valley argues in response to amicus curiae that: "Appellee has admitted within its own pleadings that the Top Lease became effective as to the shallow rights upon the execution of the release by Staab."77 The document relied on by Oil Valley for this conclusion shows Moore repeating Oil Valley's claim as to the top-lease and responding that the top-lease did not take effect by the release. The parties did not specifically seek an adjudication whether "execution of the release" satisfied the lease language for a surrender. We need not make this first-instance adjudication in an appeal.78 ¶80 Moore's focus on asserting production from the Ball # 1-24 well argues a release has no effect on his interests. He relies on Scurlock Oil Co. v. Getty Oil Co., 294 So. 2d 810 (La.1974), and Marshall v. Beekay Co., 2015-Ohio-238, 27 N.E.3d 1 (4th Dist. 2015). Scurlock discussed the effect of a quitclaim in Louisiana and held an instrument in which a party did "release, relinquish and quit claim all of its rights" applied to the party's "retained rights" possessed at time of the release. Id. 294 So. 2d at 820. In Marshall the court held that when a lease grants rights to all depths without distinction, then an assignment of shallow rights did not "sever the leasehold," and shallow production in paying qualities from a shallow-depth well held the entire lease, including the deep rights. Id. 27 N.E.3d 8-9. Neither of these opinions support Moore's argument. They are not persuasive on the issues before us to adjudicate. ¶81 Several arguments are made concerning Moore's obligations and rights based upon his status as a lessee of the deep strata rights pursuant to the Athan lease. For example, on certiorari, Oil Valley argues "Moore took no action whatsoever to develop his interest in the Deep Rights . . . during the approximately twenty-five years he owned said rights. Further, that even after Staab recorded the release on March 5, 2018, "Moore took no action under the sixty (60) day Cessation of Production Clause to engage in operations for drilling or reworking of a well." Oil Valley also alleges Moore, as a lessee, breached implied covenants. Moore states these arguments are of a type to be raised by a lessor to a lease, and not Oil Valley as a stranger to the Athan lease.79 Oil Valley does not address when a stranger to the base lease, but a lessee to a top-lease, may raise duties and obligations of parties to the base lease in a quiet title proceeding. ¶82 Oil Valley's argument is based upon Ball #1-24 well having ceased to produce in commercially paying quantities. Both Oil Valley and Moore agree that the Ball #1-24 well held the Athan lease when it was producing in commercially paying quantities. However, Oil Valley argues after the release was filed (or executed) any production from the Ball #1-24 well should be attributed to Oil Valley pursuant to the top-lease, because no lessee "pursuant to the Athan lease" was producing from the well. Continued production from the Ball #1-24 well was one fact Moore desired to use to show the unclean hands of Oil Valley for the purpose of challenging the release and top-lease in equity. This alleged fact has not been adjudicated by the District Court. ¶83 We conclude the trial court record is insufficient for adjudicating the issues concerning Moore's rights and duties as a lessee in the base lease on Moore's claim in equity that Oil Valley had unclean hands. Additionally, nothing in the record suggests the trial court actually decided these issues as part of its quiet title adjudication. We do not analyze Moore's rights and obligations as a lessee in the Athan lease for the purpose of competing quiet title claims brought by the parties. VI. Attorney Fees and Costs ¶84 Oil Valley filed an application for attorney fees and costs and relied on 12 O.S. § 696.4; §978; and §1141.5. Moore responded and argued Oil Valley failed to file with the Clerk of the Supreme Court a verified statement of taxable cost items showing that a person has paid the same as required by Okla. Sup. Ct. R. 1.14(A)(1). Moore also argued Oil Valley failed to show compliance with the Nonjudicial Marketable Title Procedures Act, (NMTPA), 12 O.S.2011 § 1141.1 - 1141.5. ¶85 Oklahoma Supreme Court Rule 1.14(A)(1) states the applicant "shall file with the Clerk a verified statement of taxable cost items showing that person has paid the same." We need not discuss costs authorized by 12 O.S.2021 § 978. A verified statement was not filed, and the application for costs of appeal is denied. ¶86 A motion for attorney fees for services performed on appeal shall be made to the appellate court by separate motion filed any time before issuance of mandate. 12 O.S.Supp.2012 §696.4(C). A motion shall cite authority for awarding attorney fees but shall not include evidentiary material concerning the amount of the attorney fees. Id. ¶87 Oil Valley relies upon the Nonjudicial Marketable Title Procedures Act, (NMTPA), 12 O.S.2011 § 1141.1 - 1141.5, specifically section 1141.5, for an attorney's fee as a prevailing party. In Stump v. Cheek, 2007 OK 97, 179 P.3d 606, we declined to make first instance determinations on disputed questions of fact or law, and remanded to the trial court for further proceedings on whether the party complied with the provisions of the NMTPA. We also decline to make first instance determination of facts and conclusions of law concerning Oil Valley's compliance with the NMTPA. The reversal herein with a remand returns the matter to the trial court without a prevailing party on the parties' opposing claims in equity.80 ¶88 In GRP of Texas, Inc. v. Eateries, Inc., 2001 OK 53, 27 P.3d 95, we awarded a conditional attorney fee based upon a party ultimately prevailing on a cause of action in the trial court on remand. However, in 2004 the Legislature amended 12 O.S.Supp.2002, §686.4 by adding paragraph "(D)" which now provides as follows. If the right of a party to recover attorney fees depends upon a determination that the party has prevailed in an action, and if the prevailing party in the action cannot be determined from the decision of the appellate court, an application for attorney fees for services performed on appeal shall be made to the trial court in the manner and within the time provided in subsection B of this section. 12 O.S.2021 §696.4(D). Application for an attorney fee based upon prevailing party status is adjudicated in the District Court when a prevailing party is determined in that court. 12 O.S.2021 § 696.4(B) & (D). VII. Conclusion ¶89 Exhibits presented during partial summary adjudication proceedings by Moore were insufficient to show the Ball #1-24 well was commercially profitable and producing in paying quantities. The parties disputed whether the well was producing in paying quantities. Whether the well was producing in paying quantities was a material fact for an element of Moore's equitable claim against Oil Valley based on the habendum clause. ¶90 Oil Valley argued whether the well was profitable did not matter, and Moore had no claim in equity because Oil Valley had a lessee's surrender or release of interest in the well. Moore's claim was not limited to whether the well was commercially profitable in paying quantities. Moore alleged Oil Valley had unclean hands when obtaining the top-lease and the release. An overriding royalty interest may be extinguished by an extinguishment of the working interest from which the override was carved by lessee's surrender in substantial compliance with the lease, unless the surrender is the result of fraud or breach of a fiduciary relationship. Moore and amicus curiae appear to argue a "washout" necessarily falls within the well-known "fraud or breach of fiduciary relationship" exception to extinguishing an overriding royalty interest when a well has commercially profitable production at the time a lessee surrenders a lease. The trial court has not been presented facts necessary to determine whether the Ball #1-24 well was profitable at the time of Staab's release. Moore's claim in equity based upon allegations of unclean hands against Oil Valley has not been determined by the trial court. ¶91 This Court will not make a first instance adjudication of rights and obligations of parties to a lease and top-lease when the facts were not developed in a trial court equitable proceeding brought to adjudicate those rights and obligations based upon all of the circumstances. ¶92 The opinion of the Court of Civil Appeals is vacated. Prevailing party status for the purpose of an attorney fee is determined in the trial court. We reverse the order granting Moore a partial summary adjudication and remand for additional proceedings consistent with this opinion. ¶93 CONCUR: KANE, C.J.; ROWE, V.C.J.; KAUGER, WINCHESTER, EDMONDSON, GURICH, DARBY, and KUEHN, JJ. ¶94 NOT PARTICIPATING: COMBS, J. FOOTNOTES 1 Each party sought adjudication based upon affirming and attacking oil and gas leases. The burden of proof to present facts and argument for a cause of action seeking cancellation of an oil and gas lease rests upon the party seeking to cancel the lease. Magnolia Petroleum Co. v. St. Louis-San Francisco Ry. Co., 1944 OK 280, 152 P.2d 367 (Court Syllabus). This burden includes showing all facts and circumstances material to the cause of action and relief sought. Stewart v. Amerada Hess Corp., 1979 OK 145, 604 P.2d 854, 858 (cancelling a lease may be based upon absence of production in paying quantities when there are no compelling equitable considerations to justify continuation of production from an unprofitable well operation); Pack v. Santa Fe Minerals, 1994 OK 23, ¶30, 869 P.2d 323 (lessors seeking to cancel oil and gas leases failed to meet their burden); Barby v. Singer, 1982 OK 49, 648 P.2d 14, 16-17 ("all of the facts and circumstances of each case" must be considered); Durkee v. Hazan, 1968 OK 96, 452 P.2d 803, 814 (viability of a lease "must be viewed in the light of all the circumstances" in a quiet title controversy). 2 In re Guardianship of Berry, 2014 OK 56, ¶40, 335 P.3d 779, 792-93 ("intermediate or interlocutory orders anterior to judgment may be reviewed on appeal from the judgment") (emphasis omitted). 3 ROA, Defendant Clay E. Moore's Motion for Summary Judgment and Brief in Support, Exhibit "H" (April 26, 2019). 4 ROA, Defendant Clay E. Moore's Motion for Summary Judgment and Brief in Support, Exhibit "I" with its attached exhibit "A" (April 26, 2019). 5 We use terms such as "shallow," "deep[er]," and "strata" without repeating the name of the Ball #1-24 well and its depth for a simpler description in our analysis distinguishing (1) a depth assignment including the Ball #1-24 well, and (2) a depth assignment for a deeper depth or strata. See, e.g., Lewis G. Mosburg, Jr., Ownership and Transfer of Title to Oil and Gas, Handbook on Petroleum Land Titles (1976), printed in, Eugene Kuntz, Oklahoma Law of Oil & Gas, 107 (1983) (commenting a division as to depth in an assignment is common, and advising that an assignment naming or distinguishing a particular formation or strata may be insufficient and specifying a particular well at a specific depth is favored). 6 ROA, Defendant Clay E. Moore's Motion for Summary Judgment and Brief in Support, "General Statement of Undisputed Facts, No. 33 (April 26, 2019). 7 ROA, Defendant Clay E. Moore's Motion for Summary Judgment and Brief in Support, Exhibit "O" (April 26, 2019). 8 Voiles v. Santa Fe Minerals, Inc., 1996 OK 13, ¶11, 911 P.2d 1205, 1209 ("A top lease is where the lease taken is subject to a pre-existing lease that has not expired when the second lease was taken."); French Energy, Inc. v. Alexander, 1991 OK 106, n.15, 818 P.2d 1234, 1238 (same). 9 ROA, Defendant Clay E. Moore's Motion for Summary Judgment and Brief in Support, 3 (April 26, 2019). 10 ROA, Plaintiff Oil Valley Petroleum LLC'S Combined Response to Defendant Clay E. Moore's Motion for Summary Judgment and Counter Motion for Summary Judgment Against Clay E. Moore and Brief in Support, 2 (May 24, 2019). 11 Id., at 3. 12 ROA, Defendant Clay E. Moore's Reply and Response to Plaintiff Oil Valley's Response and Counter-Motion for Motion for Summary Judgment and Brief in Support, 3 (June 14, 2019). 13 Id., at 4. 14 Colonial Royalties Co. v. Keener, 1953 OK 385, 266 P.2d 467, 472. An owner of a working interest may have limited that "right to work" by an operating agreement. Howard R. Williams and Charles J. Meyers, Manual of Oil and Gas Terms, 472 (5th ed. 1981) (a "non-operating working interest" is "the working interest or fraction thereof in a tract the owner of which is without operating rights by reason of an operating agreement."). 15 Hinds v. Philips Petroleum Co., 1979 OK 22, 591 P. 32d 697, 698; see also Mohoma Oil Co. v. Ambassador Oil Corp., 1970 OK 161, 474 P.2d 950, 960 ("An oil and gas lease is a chattel real, an incorporal hereditament, and a profit a pendre, which grants only the exclusive right, subject to legislative control, to explore by drilling operations, to reduce to possession, and thus acquire title to the oil and gas which is personalty."). 16 See, e.g., Indian Territory Illuminating Oil Co. v. Killingsworth, 1935 OK 937, 51 P.2d 505, 507 (discussing obligations and privity of estate with lessor, lessee, and assigns, and privity of contract); McCall v. Chesapeake Energy Corp., 2007 OK CIV APP 59, 164 P.3d 1120 (approved for publication by the Supreme Court), (a right/duty of a non-operating working interest owner adjudicated based upon a joint operating agreement). 17 Moore's Reply on summary judgment at 6. 18 Scurlock Oil Co. v. Getty Oil Co., 294 So. 2d 810 (La.1974); Marshall v. Beekay Co., 2015-Ohio-238, 27 N.E.3d 1 (4th Dist. 2015). 19 Ridge Oil Co. v. Guinn Investments, Inc., 148 S.W.3d 143 (Tex.2004); Sasser v. Dantex Oil & Gas, Inc., 906 S.W.2d 599, 604 (Tex. App.--San Antonio 1995, writ denied). 20 Progressive Direct Ins. Co. v. Pope, 2022 OK 4, ¶14, 507 P.3d 688, 693. 21 Western Heights Indep. Sch. Dist. No. I-41 of Okla. County v. State ex rel. Okla. Dep't of Educ., 2022 OK 79, n.22, ¶21, 518 P.3d 531, 540-41. 22 Tres C, LLC v. Raker Resources, LLC, 2023 OK 13, ¶22, 532 P.3d 1, 14. 23 Progressive Direct Ins. Co. v. Pope, 2022 OK 4, ¶19, 507 P.3d 688, 694-95 (meanings assigned by trial court to terms in an insurance contract based upon trial court's conclusions of law will receive de novo appellate review). 24 Progressive Direct Ins. Co. v. Pope, supra note 23; Widner v. Enerlex, Inc., 2013 OK 91, ¶¶2, 9, 313 P.3d 930, 931, 933 (summary judgment was granted in an equitable proceeding and issues of law decided by trial court received de novo appellate review). 25 Reeds v. Walker, 2006 OK 43, ¶32, 157 P.3d 100, 116; see also Spirgis v. Circle K Stores, Inc., 1987 OK CIV APP 45, ¶ 10, 743 P.2d 682, 685 (approved for publication by Supreme Court). 26 Reeds v. Walker, 2006 OK 43, ¶32, 157 P.3d 100, 116. 27 Oklahoma Pub. Employees Ass'n v. Oklahoma Dep't of Cent. Servs., 2002 OK 71, ¶6, 55 P.3d 1072, 1076. 28 Indep. Sch. Dist. No. 52 of Okla. Cty. v. Hofmeister, 2020 OK 56, ¶28, 473 P.3d 475, 489. 29 Shawareb v. SSM Health Care of Okla., Inc., 2020 OK 92, n.16, 480 P.3d 894, 900. 30 Kincaid v. Black Angus Motel, Inc., 1999 OK 54, ¶21, 983 P.2d 1016, 1022 (quoting Hadnot v. Shaw, 1992 OK 21, 826 P.2d 978, 985). 31 See, e.g., Miller v. Miller, 1998 OK 24, ¶15, 956 P.2d 887, 894 (The question of the existence of elements necessary to a particular cause action in a controversy presents a question of law reviewed de novo on appeal; and was presented for trial court adjudication by a motion to dismiss for failure to state a claim upon which relief could be granted.). 32 Claude C. Arnold Non-Operated Royalty Interest Props., L.L.C. v. Cabot Oil & Gas Corp., 2021 OK 4, ¶17, 485 P.3d 817, 822 (an oil and gas lease is a contract to be construed like any other agreement). 33 Pitco Prod. Co. v. Chaparral Energy, Inc., 2003 OK 5, ¶ 14, 63 P.3d 541, 545--46. 34 Mercury Inv. Co. v. F.W. Woolworth Co., 1985 OK 38, 706 P.2d 523, 529; Pitco Prod. v. Chaparral Energy, supra n.33. 35 In re Vose, 2017 OK 3, ¶ 28, 390 P.3d 238, 249 ("extant applicable law is a part of every contract in this state as if it were expressly cited or its terms incorporated in the contract"). 36 Rist v. Westhoma Oil Co., 1963 OK 126, 385 P.2d 791, 794, 796. 37 Myers v. Missouri Pacific R. Co., 2002 OK 60, ¶¶ 39-41, 52 P.3d 1014, 1034-35. 38 Baytide Petroleum, Inc. v. Continental Resources, 2010 OK 6, n.6, 231 P.3d 1144 (explaining a base lease); Williams and Meyers, Manual of Oil and Gas Terms, supra n. 14, at 70 (bottom lease is the existing lease covering a mineral interest upon which a second lease or top-lease has been granted). 39 Turben v. Douglas, 1919 OK 145, 183 P. 881, 886 (when an assignment was made of an oil and gas lease after commencement of a district court proceeding adjudicating ownership of the assigned lease and other leases, the Court noted the assignee acquired no greater rights by the assignment than those rights possessed by the assignor). 40 Fox v. Thoreson, 398 S.W.2d 88, 91 (Tex. 1966) (material omitted); see also Winn v. Nelson, 1983 OK 91, 670 P.2d 588 (lease executed on February 17, 1977, with a primary term of five years in a commencement-type lease, authorized operator's commencement of operations on February 16, 1982); Buckles v. Wil-McOil Corp., 1978 OK 137, 585 P.2d 1360, 1362-63 (discussed primary term, a provision of a lease, and the applicable law that is a part of a contract when executed) Williams and Meyers, Manual of Oil and Gas Terms, supra n. 14, 570-71 (primary term) (relying on Fox v. Thoreson, supra). 41 Hall v. Glamor, 2018 OK 59, n. 59, 427 P.3d at 1063. 42 Id., 2018 OK 39, n.106 & ¶51, 427 P.3d 1052, 1071-72 (noting opinions predating the statutory amendment, and quoting Wickham v. Gulf Oil Corp., 1981 OK 8, 623 P.2d 613, 616, and its explanation of the 1977 statutory amendment). 43 Owens v. Owens, 2023 OK 12, n.12, ¶36, 529 P.3d 905, 916 (opposing parties may agree on the judicial disposition of their claims provided public policy is not contravened); McDonald v. Amtel, Inc., 1981 OK 78, ¶9, 633 P.2d 743, 745 (parties may agree to contractual provision unless prohibited by law); Oklahoma Schools Risk Management Trust v. McAlester Public Schools, 2019 OK 3, ¶14, 457 P.3d 997, 1001 (argument addressed on appeal is usually based on both the substance of the argument as shaped by the parties and the substance of the trial court's adjudication). 44 Hall v. Galmor, supra note 41, at ¶36, 427 P.3d at 1067-68. 45 O'Neill v. American Quasar Petroleum Co., 1980 OK 2, 617 P.2d 181, 184. 46 XAE Corp. v. SMR Property Management Co., 1998 OK 51, ¶23, 968 P.2d 1201, 1206 (quoting Thornburgh v. Cole, 1949 OK 167, 207 P.2d 1096, 1098); see also Claude C. Arnold Non-Operated Royalty Interest Props., L.L.C. v. Cabot Oil & Gas Corp., supra n. 32, at n. 2, 485 P.3d at 819 (citing De Mik v. Cargill, 1971 OK 61, 485 P.2d 229, 232); Walden v. Potts, 1944 OK 299, 152 P.2d 923 (Syllabus by the Court) (paying quantities means not only discovery but taking out oil or gas in pursuance of the covenants and purposes of the lease in such quantities as will pay a profit to the lessee over the operating expenses). 47 See, e.g., XAE Corp. v. SMR Property Management Co., supra n.46, at ¶31, 968 P.2d at 1208 ("Because the overriding royalty interest in the case at bar is an in-kind interest deliverable at the wellhead, the costs thereafter were properly deducted before the royalty was paid."). 48 Hall v. Galmor, supra n.41, at ¶21, 427 P.3d at 1063. 49 Bixler v. Lamar Exploration Co., 1987 OK 15, 733 P.2d 410, 412 ("[T]he issue of the capability of appellee's well to produce in paying quantities is material to the resolution of this case ... this action is reversed and remanded for a determination of whether the well is capable of production in paying quantities."). 50 ROA, Plaintiff Oil Valley Petroleum LLC's Combined Response...and Counter Motion for Summary Judgment, 5 (May 24, 2019) (portion of title omitted). 51 Williams and Meyers, Manual of Oil and Gas Terms, supra n.14, 817 (A "washout" is an "[e]limination of an overriding royalty or other share of the working interest by the surrender of a lease by a sublessee or assignee and subsequent reacquistion of a lease on the same land free of such interest.") (relying in part on Berman v. Brown, 224 La. 619, 70 So. 2d 433 (1954) and Sunac Petroleum Corp. v. Parkes, 416 S.W.2d 798, 804 (Tex. 1967)). The term "washout" is used in various contexts in the oil and gas industry. See, e.g., ANR Prod. Co. v. Westburne Drilling, Inc., 581 F. Supp. 542, n.1, 1545 (D.Colo.1984) (A "washout" may also refer to "[a] hole in a drill pipe or tool joint."'). 52 Sawyer v. Guthrie, 215 F. Supp. 2d 1254, n.2, 1258 (D. Wyo. 2002). 53 Brandon Durrett, Turn Around, Don't Drown: A New Generation of Oil and Gas "Washouts" in Texas and How to Avoid Them, 53 Tex. Tech. L. Rev. 473, 474 (2021). 54 See, e.g., Lewis G. Mosburg, Jr., Contracts Used in Oil and Gas Operations, 194-196, 222-223 (1981) (American Ass'n of Petroleum Landmen, Model Form Operating Agreement, Form, 610, 1956 (Non-Federal Lands) (revised in part, 1967) and Form 610-1977 (revised 1977) (a preferential right of purchase if any party to the agreement desires to surrender or sell its interest, and a right to participate in renewal or extension of leases if any party secures a participation right); John R. Reeves, Changes to the A.A.P.L. Form 610 Model Form Operating Agreement, printed in Mosburg, supra, 128-173, 152-153 (history of Form 610, 1977 changes to Form 610, and explaining a well which has produced may not to be plugged and abandoned without the consent of all parties and distinguished rights based upon whether a party had been "fully reimbursed," and also advising parties may need to add a provision for when parties have not been fully reimbursed and a producing well becomes a "non-commercial well" ); cf. Mosburg, supra, 75-104, Conventional Farmout Agreement with Operating Agreement, Exhibit "D" Assignment (a reassignment to assignor if an assignee "should elect to surrender, abandon or release all or any part of its rights in said lease acreage"). 55 Otter Oil Co. v. Exxon Co., 834 F.2d 531, 533 (5th Cir. 1987)("The purpose of the extension-and-renewal clause is to prevent a 'washout,'" and protect the overriding royalty); EOG Resources, Inc. v. Hanson Production Co., 94 S.W.3d 697, 703 (Tex. App.-San Antonio 2002, no pet.) ("An overriding interest created by assignment does not survive the termination of the assigned lease unless the instrument creating the overriding interest provides an express provision to the contrary."); cf. Robinson v. North American Royalties, Inc., 463 So. 2d 1384 (La. Ct. ApP.3d Cir. 1985) (An "extension clause" is "commonly referred to as an anti-washout provision" and provides the overriding royalty interest will also apply to any new mineral leases.); 5 Eugene Kuntz, A Treatise on the Law of Oil and Gas § 63.2, at 229 (1991) (noting an "instrument by which the interest is created may provide that the overriding royalty will apply to modifications, renewals, and extensions of the lease"). 56 SM Energy Co. v. Sutton, 376 S.W.3d 787, 791 (Tex. App. -- San Antonio 2012, pet. denied) ("It was the ORRIs' owners' burden to include an express provision to save their ORRIs from being extinguished by a partial termination that the lease expressly contemplated."); cf. Apache Deepwater, LLC v. McDaniel Partners, Ltd., 485 S.W.3d 900, 905 (Tex. 2016) ("Thus, in the case of a single lease, an overriding royalty ... will not survive termination of the leasehold it burdens unless the parties have expressly agreed otherwise."). 57 See, e.g., Lillibridge v. Mesa Petroleum Co., 907 F.2d 1031, 1035-36 (10th Cir. 1990) (applying Kansas law and discussing interests of the parties, concluding a new lease did not involve a confidential relationship, and explaining "the relief the court [in Kansas] extended to holders of royalty interests under terminated leases was plainly limited to cases involving fraud or collusion") (explaining Campbell v. Nako Corp., 195 Kan. 66, 402 P.2d 771 (1965) (explanatory phrase added)). 58 See, e.g., 2 Pomeroy's Equity Jurisprudence, § 924 (1905) ("Constructive Fraud Apparent from the Intrinsic Nature and Subject of the Transaction Itself--This class includes three principal subjects: 1. Inadequacy of consideration; 2. Contracts illegal because opposed to statute, or to public policy, or to good morals; and 3. Certain transactions which, in analogy with contracts, equity regards as contrary to public policy, an therefore illegal."). 59 Patel v. OMH Medical Center, Inc., 1999 OK 33, ¶ 34, 987 P.2d 1185, 1199; see also 15 O.S.2011 § 59: "Constructive fraud consists: 1. In any breach of duty which, without an actually fraudulent intent, gains an advantage to the person in fault, or any one claiming under him, by misleading another to his prejudice, or to the prejudice of any one claiming under him; or, 2. In any such act or omission as the law specially declares to be fraudulent, without respect to actual fraud." 60 See, e.g., ENI Producing Props. Program Ltd. P'ship 1982--I, etc. v. Samson Inv. Co., 1991 OK 21, ¶18, 977 P.2d 1086, 1089 (fraud claim premised on a failure to inform must be established on a duty to inform) (citing Silk v. Phillips Petroleum Co., 1988 OK 93, 760 P.2d 174, 179). 61 Amicus Curiae Brief in Support of Appellee's Petition for Certiorari, 4 (March 10, 2022) (quoting Kuntz, Law of Oil and Gas § 55.3.). 62 Amicus Curiae Brief, at 3 (explanation added). 63 See, e.g., Bank of Meno v. Coulter, 1923 OK 1144, 221 P. 495, 497 (discussing principles in equity and stating the party who purchases with full notice of the equitable claim of another to the same property will not be permitted to be protected against that claim, but the purchaser's title will be postponed and made subservient to it based upon the concept of a constructive fraud); Henry E. Smith, Equity as Meta-Law, 130 Yale L.J. 1050, 1076 (2021) ("[E]quity has always had a special role in combatting opportunism... this went under the banner of 'constructive fraud'-- activities that might not technically be fraud but that carried a danger of the same kind of harm... [including] ... unconscionability, denials of injunctions, [and] unclean hands.") (material omitted). 64 Tulsa Cty. Budget Bd. v. Tulsa Cty. Excise Bd., 2003 OK 103, n.31, 81 P.3d 662, 672 (Court does not issue advisory opinions). 65 Appellant's Response to Amicus Curiae Brief in Support of Appellee's Petition for Certiorari, unnumbered pg. 2-3. (March 25, 2022). 66 See, e.g., Henry L. McClintock, Handbook on the Principles of Equity, (2d ed. 1948) ("It was the general rule that allegations contained in the other parts of the bill could not cure the failure to allege some fact essential to plaintiff's success in the stating part of the bill."). 67 Gaylord Entertainment Co. v. Thompson, 1998 OK 30, n.10, 958 P.2d 128, 136; 12 O.S.2011 §2010(C). Additionally, 12 O.S.2011 § 2010(B) provides in part: "All averments of claim or defense shall be made in numbered paragraphs,...and a paragraph may be referred to by number in all succeeding pleadings." 68 In some federal courts, a pleading that incorporates every antecedent allegation of fact for every subsequent claim for relief in the pleading without respect to whether allegations are appropriate or unnecessarily repetitive is sometimes described as one of the characteristics of the discredited "proverbial shotgun pleading." Wagner v. First Horizon Pharm. Corp., 464 F.3d 1273, 1279 (11th Cir. 2006); In re Smith, 489 B.R. 875, 891 (Bankr. M.D.Ga. 2013). 69 Wilson v. Webb, 2009 OK 56, ¶9, 221 P.3d 730, 734; cf. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007) (Fed. R. Civ. Pro. 8(a)(2) "requires only 'a short and plain statement of the claim showing that the pleader is entitled to relief,' in order to 'give the defendant fair notice of what the ... claim is and the grounds upon which it rests.'"). 70 Torres v. Seaboard Foods, LLC, 2016 OK 20, n.2, 373 P.3d 1057, 1063 (amicus curiae may not expand the record on appeal); City of Okla. City v. State ex rel. Okla. Dept of Labor, 1995 OK 107, n.4, 918 P.2d 26, 32 (supplemental opinion on rehearing) (amicus curiae's participation is confined to the issues raised by the parties). 71 See, e.g., Farrington v. Allsop, 670 N.E.2d 106 (Ind.Ct.App.1996), (holding constructive fraud might give rise to an equitable estoppel, and stating "The basis for the doctrine of equitable estoppel is fraud, either actual or constructive, on the part of the person estopped.'") (quoting Lawshe v. Glen Park Lumber Co., 176 Ind.App. 344, 375 N.E.2d 275, 278 (1978); In re Cancellation of Stabio Ditch Water Right on Spearfish Creek, 417 N.W.2d 391 (S.D. 1987) ("The essential element of equitable estoppel is fraud."). 72 See, e.g., Maness v. K&A Enterprises of Mississippi, LLC, 250 So. 3d 402, 412 (Miss. 2018) ("fraud is not required for equitable estoppel to be applied") (citing PMZ Oil Co. v. Lucroy, 449 So. 2d 201, 207 (Miss. 1984) (while a fraudulent intent to deceive may give rise to an estoppel, a substantial inequity may arise justifying an estoppel without an original subjective intent to deceive); cf. 2 Pomeroy's Equity Jurisprudence, supra n. 58 at § 803 (the essence of equitable estoppel is not the same as fraud, but "[i]t is accurate, therefore, to describe equitable estoppel, in general terms, as such conduct by a party that it would be fraudulent, or a fraud upon the rights of another, for him afterwards to repudiate and to set up claims inconsistent with it."). 73 Notten v. Mensing, 3 Cal. 2d 469, 45 P.2d 198, 202 (1935). 74 A--Plus Janitorial & Carpet Cleaning v. Employers' Workers' Comp. Ass'n, 1997 OK 37, 936 P.2d 916, 930-31 Resolution Trust Corp. v. Greer, 1995 OK 126, n.43, 911 P.2d 257, 265; 12 O.S.2021 § 2009(B). 75 McKee v. Grimm, 1925 OK 425, 238 P. 835 (surrender of lease in substantial compliance with a provision in a lease will be given effect) (Syllabus by the Court). 76 Plains Petroleum Corp. v. Fine, 1935 OK 825, 51 P.2d 284, 286 (oil and gas lease provided a "Lessee may at any time surrender this lease by delivery or mailing a release thereof to the lessor, or by placing a release thereof on record in the proper county."). 77 Appellant's Response to Amicus Curiae Brief In Support of Appellee's Petition for Certiorari, n.3, unnumbered pg. 2 (March 25, 2022) (citing "Defendant Clay E. Moore's Reply and Response to Plaintiff Oil Valley's Response and Counter-Motion for Summary Judgment and Brief in Support at pgs. 4-6."). 78 Western Heights Indep. Sch. Dist. No. I-41 of Okla. County v. State ex rel. Okla. Dep't of Educ., supra n.21, at ¶23, 518 P.3d at 541 (Court does not make first-instance determinations of disputed issues of either law or fact in the exercise of its appellate jurisdiction.). 79 See, e.g., Hall v. Galmor, supra n. 41, at ¶40, 427 P.3d at 1069 (discussing James Energy Co. v. HCG Energy Corp., 1992 OK 117, 847 P.2d 333, and its statement "the lessor must demand that an implied covenant be complied with before a court of equity will grant a forfeiture"). 80 Smedsrud v. Powell, 2002 OK 87, ¶13, 61 P.3d 891, 896 (on a judgment's reversal and a cause remanded, it returns to the trial court as if the judgment had never been decided, save only for the settled law of the case); Parker v. Elam, 1992 OK 32, 829 P.2d 677, 682 ("On remand from a reversed judgment, the parties are entitled to introduce additional evidence, supplement the pleadings, and expand the issues, unless specifically limited by the proceedings in error.").

a9a48e38-a958-4096-9b45-78ab761bc6be

Childers v. Arrowood

oklahoma

Oklahoma Supreme Court

CHILDERS v. ARROWOOD2023 OK 74Case Number: 119815Decided: 06/20/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. RORY CHILDERS and EMMY CHILDERS, husband and wife, Plaintiffs/Appellees, v. JAMES ARROWOOD and JENNIFER, ARROWOOD, husband and wife, Defendants/Appellants. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III HONORABLE DOUGLAS W. GOLDEN, TRIAL JUDGE ¶0 The Childers purchased property in Creek County which did not have access to utilities. The Childers sought a utility easement across the Arrowoods' property pursuant to 27 O.S. § 6, arguing that "private ways of necessity" within 27 O.S. § 6 include utilities. The trial court granted the utility easement. The Court of Civil Appeals affirmed, noting that Oklahoma's public policy favoring land utilization would favor granting the Childers' requested utility easement. We hold that "private ways of necessity" within 27 O.S. § 6 include access to utilities that are necessary for the effective use and reasonable enjoyment of property. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; JUDGMENT OF TRIAL COURT AFFIRMED; REMANDED FOR FURTHER PROCEEDINGS. Joseph V. Allen, LOEFFLER, ALLEN, & HAM, Sapulpa, Oklahoma for Plaintiffs/Appellees. Harvey D. Ellis and Michael J. Gibbens, CROWE & DUNLEVY, a Professional Corporation, Oklahoma City and Tulsa, Oklahoma for Defendants/Appellants. OPINION ROWE, V.C.J.: ¶1 The issue presented is one of first-impression: What does "private ways of necessity" include, as provided in 27 O.S. § 6. BACKGROUND ¶2 Rory Childers and Emmy Childers, Plaintiffs/Appellees, (the "Childers") are the owners of real property located in Creek County Oklahoma (the "Childers Property"). James Arrowood and Jennifer Arrowood, Defendants/Appellants, (the "Arrowoods") are the owners of real property to the west of the Childers Property (the "Arrowood Property"). Prior to 2008 the Childers Property was land-locked. The Childers' predecessors-in-interest obtained an express easement over the Arrowoods' predecessors-in-interest's property "for roadway purposes only."1 The easement was filed of record in the office of the Creek County Clerk.2 ¶3 The Childers purchased their property in 2020 with hopes to build a home but were informed by local utility providers that no utilities were connected to their property and no utilities would be connected absent an easement expressly granting authority to install utilities. The Childers filed a condemnation proceeding against the Arrowoods seeking a utility easement. After granting the Childers' Motion for Appointment of Commissioners and Determination of Just Compensation, the trial court held a hearing to determine whether the express easement obtained by the Childers' predecessor-in-interest included the right to a utility easement. The trial court found the existing easement did not include a utility easement but granted the requested utility easement reasoning that a utility easement is a reasonable necessity for the Childers to utilize their property. COCA affirmed the trial court's ruling and we granted certiorari. STANDARD OF REVIEW ¶4 The issue before us is a legal question: what does "private ways of necessity" include, as provided in 27 O.S. § 6. Questions of law are reviewed by a de novo standard. Fanning v. Brown, 2004 OK 7, ¶ 8, 85 P.3d 841, 845. Likewise, legal questions involving statutory interpretation are subject to de novo review. Cole v. Josey, 2019 OK 39, ¶ 3, 457 P.3d 1007, 1009. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. DISCUSSION ¶5 The Childers seek to condemn the Arrowood Property to obtain a utility easement pursuant to the eminent domain power granted to private persons in 27 O.S. § 6. The trial court granted the Childers' utility easement and COCA affirmed, finding "private ways of necessity" included a utility easement under Okla. Const. art. 2, § 233 and 27 O.S. § 6.4 Specifically, COCA held a utility easement "is available under Oklahoma law and is consistent with Oklahoma's public policy favoring the utilization of land and prevention of rendering land useless."5 COCA found 27 O.S. § 6 should be interpreted to include the requested utility easement, reasoning "if utilities are necessary for residential owners to make use of their land, Oklahoma's public policy would favor granting easements for such utilities."6 A. The Common Law Easement by Necessity and 27 O.S. § 6 Seek to Prevent Property From Being Land-locked and Rendered Useless. ¶6 The parties disagree as to the relationship between common law easements by necessity and 27 O.S. § 6. A common law easement by necessity requires a showing of several elements,7 notably a common grantor. Generally, "where the conveyor of land retained a landlocked portion, the law implies that a way of necessity was intended, unless contrary intent is inescapably manifested." Jones v Weiss, 1977 OK 188, ¶ 7, 570 P.2d 948, 949. Conversely, 27 O.S § 6 authorizes landowners the ability to condemn another's property to obtain "private ways of necessity." This statutory private way of necessity is an alternative method to obtain a way of necessity when the elements of a common law easement by necessity do not exist. In effect, 27 O.S. § 6 eliminates the common law elements but requires just compensation and a showing of a present necessity. ¶7 The two meaningful distinctions between the common law easement by necessity and the statutory way of necessity are: (a) the statutory way of necessity requires compensation to be paid to the owner of the burdened property, and (b) the common law easement by necessity requires there to have been unity of title between the benefited and burdened estates that were severed. What the common law easement by necessity and the statutory way of necessity share in common is their underlying purpose--to prevent property from being land-locked and rendered useless.8 Both ways of necessity, regardless of their differences, seek to allow land-locked landowners to have effective use and reasonable enjoyment of their property. B. Neither a Showing of the Elements of a Common Law Easement by Necessity nor a Showing of a Public Purpose are Required by 27 O.S. § 6. ¶8 The Arrowoods request that we determine whether "private ways of necessity" pursuant to 27 O.S. § 6 require proof of the elements of a common law easement by necessity or proof of a public purpose. As noted above, the requirements of "private ways of necessity" differ from the requirements of a common law easement by necessity. The case before us does not concern a common law easement by necessity as the Childers are seeking "private ways of necessity" pursuant to 27 O.S. § 6. Therefore, the Childers were not required to show the elements of a common law easement by necessity to acquire the easement.9 ¶9 The Arrowoods contend that absent a showing of the elements of a common law easement by necessity, 27 O.S. § 6 requires proof of a public purpose. Relying on Board of County Commissions of Muskogee County v. Lowery, 2006 OK 31, 136 P.3d 639, the Arrowoods argue that both the federal and Oklahoma constitutions forbid taking property for a "private benefit." Lowery, ¶ 9, n. 10, 136 P.3d at 645. Because Okla. Const. art. 2, § 23 and the Takings Clause of the Fifth Amendment of the United States Constitution prohibit the taking of property for a private purpose, the Arrowoods contend 27 O.S. § 6 requires proof of a public purpose. ¶10 In Lowery, Muskogee County initiated a condemnation proceeding pursuant to 27 O.S. § 510 for the purpose of acquiring a right-of-way easement for placement of three water pipelines, two of which would solely service a private electric generation plant, with the third pipeline servicing the residents of the rural water district not currently served. Lowery, ¶¶ 1-2, 136 P.3d at 642-43. The landowners argued that county's proposed taking was an unlawful taking of property for private use in violation of 27 O.S. § 5. County argued that the economic development of Muskogee County was a public purpose within the statute. On appeal, we analyzed 27 O.S. § 5 and Okla. Const. art. 2, §§ 23 and 24 to determine the meaning of "public purpose." We held economic development is not a public purpose within the statute. Id. ¶ 20, 136 P.3d at 652. ¶11 The Arrowoods' reliance on Lowery is misplaced. First, Okla. Const. art. 2, § 23 prohibits taking of property for a private purpose but specifically exempts "private ways of necessity."11 Second, Lowery did not concern "private ways of necessity," rather it was a 27 O.S. § 512 action which explicitly requires proof of a public purpose. Lowery's facts and application of the law have no bearing on the analysis of the case before us. Section 6 concerns the taking of "private ways of necessity," which by definition is for a private purpose. It is illogical to require a public purpose for "private ways of necessity."13 We find 27 O.S. § 6 does not require proof of a public purpose. C. "Private Ways of Necessity" as provided in 27 O.S. § 6 Include Access to Utilities That Are Necessary for the Effective Use and Reasonable Enjoyment of Property. ¶12 The question of what "private ways of necessity" include is a matter of first impression and concerns the interpretation of 27 O.S. § 6. Section 6 provides: Any private person, firm or corporation shall have the power to exercise the right of eminent domain in like manner as railroad companies for private ways of necessity or for agriculture, mining or sanitary purposes. The Arrowoods contend we should construe "private ways of necessity" to refer only to a passageway of ingress to and egress from land-locked property. Conversely, the Childers contend such a limited construction of "private ways of necessity" lacks support and numerous other jurisdictions have determined that utilities may be included within ways of necessity. ¶13 The Arrowoods rely upon two cases outside of this jurisdiction to support their interpretation. First, the Arrowoods cite Akin v. Four Corners Encampment, 179 P.3d 139 (Colo. App.2007). In Akin, the district court denied landowners, whose property contained a natural gas well, the ability to condemn a private way of necessity over neighbors' properties for a pipeline. The Colorado Court of Appeals affirmed the district court's ruling because Colorado's condemnation statute for private ways of necessity "[does] not authorize condemnation of an easement for a private way of necessity for the purpose sought by petitioners--to construct and maintain a natural gas pipeline and related connection equipment and facilities." Akin, 179 P.3d at 142 (Colo.App.2007). Second, the Arrowoods cite Brown v. McAnally, 644 P.2d 1153 (Wash. 1982). In Brown, the Washington State Supreme Court held that the state constitution and the condemnation statute for private ways of necessity declare a public policy against rendering land-locked property useless, such that "an owner or one entitled to the beneficial use of land-locked property may condemn a private way of necessity for ingress and egress in the ordinary sense of 'way,' i.e., a mere right of passage over land." Brown, 644 P.2d at 1158 (Wash. 1982). ¶14 State cases outside of this jurisdiction are not binding on this Court and will be treated only as persuasive authority.14 Even so, Akin and Brown are distinguishable from the present case. The landowners in Akin did not seek to construct private utilities that were necessary for the effective use and reasonable enjoyment of land. Rather, the landowners in Akin sought to construct a natural gas pipeline for commercial use. And in Brown the condemnation statute for private ways of necessity included a definition of the term "private ways of necessity"--which is not true of 27 O.S. § 6. ¶15 To answer the question before us, we look to the text of 27 O.S. § 6. "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. "It is presumed that the Legislature has expressed its intent in a statute's language and that it intended what it so expressed." Id. "Only where legislative intent cannot be ascertained from the language of a statute, as in cases of ambiguity, are rules of statutory interpretation employed." Id. ¶ 18, 415 P.3d 521, at 528. (citations omitted). "The test for ambiguity in a statute is whether the statutory language is susceptible to more than one reasonable interpretation." Id. (citations omitted). In addition, we are guided by the general rule that "[c]onstitutional and statutory provisions relating to eminent domain must be strictly construed in favor of the landowner and against the condemning party." Carter v. City of Oklahoma City, 1993 OK 134, ¶ 12, 862 P.2d 77, 80. ¶16 The statute does not define "private ways of necessity" nor have we interpreted its meaning. Reading the statute in its entirety, it appears the Legislature intended for 27 O.S. § 6 to afford private persons the right to exercise eminent domain for purposes beyond ingress and egress to property. This is evidenced by the Legislature's allowance of a private person's right to exercise eminent domain not only for "private ways of necessity" but also "for agriculture, mining, and sanitary purposes." Moreover, 27 O.S. § 6 is complemented by Okla. Const. art. 2, § 23 which allows private property to be taken not only for "private ways of necessity" but also "for drains and ditches across lands of others for agricultural, mining, or sanitary purposes." The qualifying language "drains and ditches across lands of others" expands beyond ingress and egress exclusively. ¶17 Further evidence of the Legislature's intention to expand "private ways of necessity" beyond ingress and egress is the Legislature's deliberate plural use of "ways." Had the Legislature used the singular "way" we would be more inclined to read the statute as allowing for a way of ingress and egress exclusively. However, the deliberate use of the plural "ways" indicates the Legislature intended for a private person to establish as many ways as are necessary for the effective use and reasonable enjoyment of property. ¶18 In light of the text, we agree with the trial court that "private ways of necessity" include access to utilities if such utilities are necessary to have effective use and reasonable enjoyment of property. What is necessary depends on the nature of the property.15 Today, the use of land requires physical access, but access is not necessarily the only necessity required to have effective use and reasonable enjoyment of property. In modern times, the effective use and reasonable enjoyment of property often requires access to utilities. To limit "private ways of necessity" to only mean a passageway for ingress and egress runs contrary the text and Oklahoma's public policy favoring land utilization. ¶19 Although the Childers Property is not physically land-locked due to the existing roadway easement acquired by the Childers' predecessors-in-interest, without access to utilities the Childers are nevertheless deprived of the effective use and reasonable enjoyment of their property. While 27 O.S. § 6 must be strictly construed in favor of the condemned landowner, it cannot be construed so strictly as to frustrate the purpose of the statute, as the cardinal rule of statutory construction is to give effect to the legislative purpose.16 In light of the text of 27 O.S. § 6 coupled with Oklahoma's public policy favoring land utilization, we find that "private ways of necessity" include access to utilities that are necessary for the effective use and reasonable enjoyment of property. ¶20 Lastly, we read 27 O.S. § 6 in harmony with Okla. Const. art. 2, § 23. The meaning of language in a statute is construed by courts as internally consistent and externally consistent with the constitution, i.e., the meaning of the statute's language is construed so that it does not contradict either itself or the constitution. Young v. Station 27, Inc., 2017 OK 68, ¶ 18, 404 P.3d 829, 838. Okla. Const. art. 2, § 23 provides that "[n]o private property shall be taken or damaged for private use, with or without compensation," but expressly exempts "private ways of necessity" and "drains and ditches across lands of others for agricultural, mining, or sanitary purposes" from the public use requirement. Both Okla. Cost. art. 2, § 23 and 27 O.S. § 6 authorize the taking of private property for "private ways of necessity." Therefore, our finding that "private ways of necessity" include access to utilities is not contradictory of Oklahoma's constitutional provision allowing for the taking of private property for "private ways of necessity." ¶21 Left to be considered is whether the requested utility easement would place an undue burden on the Arrowood Property. Oklahoma law provides that the use made by the dominant estate must not unreasonably burden the servient estate. Burkhart v. Jacob, 1999 OK 11, ¶ 12, 976 P.2d 1046, 1050. Additionally, if the easement does not unreasonably burden the Arrowood Property, the trial court must determine the amount of just compensation.17 These questions remain for the trial court. CONCLUSION ¶22 Title 27 O.S. § 6 provides private persons the right to condemn property of another for "private ways of necessity." We find that "private ways of necessity" include access to utilities when necessary for the effective use and reasonable enjoyment of property. Whether the requested easement places an undue burden on the condemned landowner, and if not, the amount of just compensation, remains for the trial court to determine. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; JUDGMENT OF TRIAL COURT AFFIRMED; REMANDED FOR FURTHER PROCEEDINGS. Kane, C.J., Rowe, V.C.J., Kauger, Winchester, Edmondson, Gurich, Darby, and Kuehn, JJ., concur. Combs, J., concurs in result. FOOTNOTES 1 In 2006, the Childers' predecessors-in-interest sought a private way of necessity across the Arrowoods' predecessors-in-interest property pursuant to 27 O.S. § 6. Following a trial on the merits, the trial court held that the Childers' predecessors-in-interest were entitled to a right-of-way by necessity because their property "[had] no reasonable means of ingress and egress to and from their property." Jones v. Ransom, 2008 OK CIV APP 44, ¶ 6, 184 P.3d 561, 562. The trial court's ruling was appealed. The Oklahoma Court of Civil Appeals affirmed the ruling of the lower court in Jones v. Ransom, 2008 OK CIV APP 44, 184 P.3d 561 and remanded the case to the trial court to determine the amount of just compensation. Before the trial court ruled on just compensation, the parties reached an agreement and dismissed all of their claims after the Arrowoods' predecessors-in-interest executed an express easement for "roadway purposes only" in the Childers' predecessors-in-interest's favor. 2 Based on the Arrowoods' and Childers' predecessors-in-interest's previous litigation, the Arrowoods raised the doctrine of collateral estoppel or issue preclusion as a defense before the trial court. The Arrowoods argued that the trial court's 2006 grant of a right of way easement pursuant to 27 O.S. § 6 precluded the Childers from taking additional property for a utility easement by way of 27 O.S. § 6. The trial court found collateral estoppel did not apply because there was not a final judgment in the 2006 case. Because the parties failed to raise the issue of collateral estoppel on appeal before COCA or this Court, we may not consider it. "Issues not presented in the petition for certiorari may not be considered by the Supreme Court." Ok.Sup.Ct.R. 1.180(b). 3 "No private property shall be taken or damaged for private use, with or without compensation, unless by consent of the owner, except for private ways of necessity, or for drains and ditches across lands of others for agricultural, mining, or sanitary purposes, in such manner as may be prescribed by law." Okla. Const. art. 2, § 23. 4 "Any private person, firm or corporation shall have the power to exercise the right of eminent domain in like manner as railroad companies for private ways of necessity or for agriculture, mining or sanitary purposes." 27 O.S. § 6. 5 COCA Op. ¶ 2. 6 Id. ¶ 3. 7 Generally, to show the existence of a common law easement by necessity, a plaintiff must prove the following elements: (1) unity of title; (2) conveyance of part of the land previously held under unity of title; and (3) a resulting necessity for access to the property at the time of its severance. Johnson v. Suttles, 2009 OK CIV APP 90, ¶ 9, 227 P.3d 664, 667. "The common law easement by necessity was based upon the implication of a grant of an easement by the owner of the servient estate when necessity of access to the dominant estate required it. Such a theory requires proof of a common grantor at one time of the two properties since the creation of such an easement is based upon the presumed intent of the grantor to convey a way as well as the property." Id. citing Franks v. Tyler, 1974 OK CIV APP 55, ¶ 4, 531 P.2d 1067, 1069. 8 In Jones v. Weiss, 1977 OK 188, ¶¶8-9, 570 P.2d 948, 949-50, we quoted Powell on Real Property and the Restatement (First) of Property § 476, Comment (g) which discusses the public policy in favor of land utilization in the context of common law easements by necessity. By applying those legal principles, this Court acknowledged Oklahoma's recognition of the public policy of land utilization. 9 In Franks v. Tyler, 1974 OK CIV APP 55, 531 P.2d 1067 (reversed on other grounds), the parties initiated a private condemnation proceeding pursuant to 27 O.S. § 6, but the issue was abandoned when the defense convinced the court that acquisition of a way of necessity by eminent domain under Okla. Const. art 2, § 23 and 27 O.S. § 6 required the same elements of proof as a common law easement by necessity. It was undisputed the elements were not present. COCA explained the difference between the statutory private way of necessity and the common law easement by necessity and correctly determined that the trial court erred in denying the condemnation proceeding. COCA explicitly held that "the right to condemn a way of necessity under constitutional and statutory provisions is an expression of public policy against landlocking property and rendering it useless . . . [s]uch a policy should not and does not depend upon whether there was ever a common owner of the dominant and servient estates." Franks, ¶ 9, 531 P.2d at 1070 (citations omitted). 10 Any county, city, town, township, school district, or board of education, or any board or official having charge of cemeteries created and existing under the laws of this state, shall have power to condemn lands in like manner as railroad companies, for highways, rights-of-way, building sites, cemeteries, public parks and other public purposes. 27 O.S. § 5. 11 "No private property shall be taken or damaged for private use, with or without compensation, unless by consent of the owner, except for private ways of necessity, or for drains and ditches across lands of others for agricultural, mining, or sanitary purposes, in such manner as may be prescribed by law." (emphasis added). Okla. Const. art. 2, § 23. 12 "Any county, city, town, township, school district, or board of education, or any board or official having charge of cemeteries created and existing under the laws of this state, shall have power to condemn lands in like manner as railroad companies, for highways, rights-of-way, building sites, cemeteries, public parks and other public purposes." 27 O.S. § 5 (emphasis added). 13 As noted by COCA in the parties' predecessors-in-interest's case in Jones v. Ransom, 2008 OK CIV APP 44, ¶ 19, 184 P.3d 561, 565, "[o]ther than the public policy which disfavors land-locked property, the taking of a 'private ways of necessity' is, by definition, for a private purpose. Consequently, the private purpose defense is not available in a private condemnation proceeding." 14 Bishop v. Takata Corp., 2000 OK 71, ¶ 15, 12 P.3d 459, 464. (The parties relied on decisions from the Supreme Court of Minnesota and Texas as persuasive authority in support of their arguments). 15 "Necessary" rights are not limited to those essential to enjoyment of the property, but include those which are reasonably required to make effective use of the property. . . What is necessary depends on the nature and location of the property, and may change over time. Access by water, while adequate at one time, is generally not sufficient to make reasonably effective use of property today. Land access will almost always be necessary, even though water access is available. Even in the case of remote recreational properties, where access has traditionally been by water, implication of servitudes for land access is justified, unless the parties clearly intended to deprive the property of land access rights. Until recently, access for foot and vehicular traffic tended to be the only rights regarded as necessary for the enjoyment of surface possessory estates. However, the increasing dependence in recent years on electricity and telephone service, delivered through overland cables, justify the conclusion that implied servitudes by necessity will be recognized for those purposes. Whether access for other utilities and services has also become necessary to reasonable enjoyment of property depends on the nature and location of the property and normal land uses in the community. Restatement (Third) of Property (Servitudes) § 2.15 (2000). 16 "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. 17 Prior to this appeal, the trial court appointed commissioners to inspect and value the Arrowood Property. The Commissioners filed a report determining just compensation totaled $7,500. Both parties filed written exceptions to the report. The trial court did not make an order either confirming or rejecting, nor did it order a new appraisement.

614bcf27-f530-4c05-a74e-6f97610af267

Murrow v. Penney

oklahoma

Oklahoma Supreme Court

MURROW v. PENNEY2023 OK 91Case Number: 120915Decided: 09/19/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JEFFREY MURROW and KRISTINE MURROW, Husband and Wife, individually, as Parents and and Next of Kin to MARISSA MURROW, Deceased, Plaintiffs/Appellants, v. MALCOLM PENNEY, an individual; AMANDA PENNEY, an individual; THE SPRINGS EVENTS, LLC. d/b/a The Springs Event Venue-Edmond, a foreign limited liability company; WEATHERCOAT SECURITY, a domestic entity; and BOULEVARD STEAKHOUSE, INC., a domestic company, Defendants/Appellees. ON APPEAL FROM THE DISTRICT COURT OF CANADIAN COUNTY, STATE OF OKLAHOMA Honorable Jack McCurdy II, District Judge ¶0 The defendant/appellee, Malcolm Penney left a wedding which was held at The Springs Event Venue and proceeded to drive the wrong way down a highway. He crashed head-on into a vehicle driven by Marissa Murrow, killing her. Murrows' parents sued The Springs. They did not allege that The Springs over-served Penney. Rather, they alleged The Springs had a duty to prevent Penney from leaving, and to enforce their policies which prohibited outside alcohol from being brought onto the premises. The trial court determined that the event venue had no duty to prevent harm to third-parties such as the deceased, and it granted summary judgment to The Springs. The parents appealed, and we retained the cause. We hold that Oklahoma law does not recognize a duty on the part of a private event venue extending to third parties killed by a voluntarily intoxicated adult who attended, but was not "over-served" by the event venue. ORDER OF THE DISTRICT COURT AFFIRMED. Derrick T. DeWitt, Kenneth G. Cole, Kevin Cunningham, William T. Milam, III, Oklahoma City, Oklahoma, for Plaintiffs/Appellants. Michael C. Felty, Eric L. Combs, Matthew J. Becker, Oklahoma City, Oklahoma, for Defendant/Appellees The Springs Events, LLC. KAUGER, J., ¶1 The issue presented is whether a private event venue may be held liable to a third party who is injured or killed by a voluntarily intoxicated adult driver who attended an event at the venue, but was not "over-served" by it. We hold that Oklahoma law does not recognize a duty on the part of a private event venue extending to third parties killed by a voluntarily intoxicated adult who attended but was not "over-served," by it. FACTS ¶2 On the night of October 2, 2020, the defendant/appellant, Malcolm Penney (Penney) took car keys from his ex-wife's purse and drove her automobile the wrong direction on the Kilpatrick Turnpike near Yukon, Oklahoma, and Interstate 40. He crashed head-on into an automobile driven by Marissa Murrow (Murrow), a 19-year old sophomore college student, killing her. ¶3 Prior to the crash, Penney attended a wedding and reception at The Springs Event Venue (The Springs/event venue) in Edmond, Oklahoma. Penney left the event venue intoxicated. He had previously been adjudicated guilty of four DUI's, and one count of public intoxication.1 Penney's blood test, taken several hours after the collision, was more than twice the legal limit for blood-alcohol content.2 ¶4 According to Penney's ex-wife, the defendant/appellant, Amanda Penney, she hid the car keys in her purse in the bridal suite after she smelled alcohol on Penney's breath at the wedding reception. Penney had obtained alcohol by stopping by a liquor store before the event, and from an ice chest brought to the event by the groomsmen. The event venue rental contract prohibits alcohol consumption on-premises, unless it is served by an approved licensed bartender.3 ¶5 Weathercoat Security, the only security authorized to serve The Springs, provided security for the wedding. It operates from the same address as The Springs, and it was operated by the husband of The Springs General Manager. The Boulevard Steakhouse/HRG Catering provided the catering and bar service. Apparently, neither security, nor the bartender knew how much Penney drank, realized he was drunk, or asked him to leave due to his drunkenness.4 ¶6 On November 20, 2020, Murrow's parents, the plaintiffs/appellants, Jeffrey and Kristine Murrow (parents) filed a lawsuit against Penney, his ex-wife, as the owner of the vehicle Penney was driving, and The Springs Events, LLC. (The Springs). The parents alleged a negligence action against Penney. They asserted he unlawfully, illegally, negligently, recklessly, and in an intoxicated condition, operated a motor vehicle. They also asserted a cause of action for his failure to help the victim of harm because he fled the scene of the collision. They claimed a negligent entrustment action against his ex-wife. ¶7 The parents' action against The Springs was not premised on the allegation that it had illegally, improperly, or over-served Penney alcohol. The disputed facts indicate Penney may have had, either access, or the opportunity to access some minimal amount of alcohol from the bar at the event. Nevertheless, serving or over-serving alcohol by the bartender is not at issue in this cause. Rather, it was that, The Springs was negligent in enforcing their policies, procedures, and prohibitions. These policies were designed to prevent the unauthorized and improper on-premises alcohol consumption by people who attended events at the event venue. They alleged that The Springs: 1. Allowed personal alcohol to be brought onto its premises; 2. Allowed personal alcohol to be consumed on its premises by attending the event; 3. Allowed the presence and consumption of alcohol on its premises prior to a licensed bartender arriving; 4. Failed to restrict the service of alcoholic beverages to only a vendor bartending company; 5. Failed to restrict on-premises alcohol consumption to no more than six (6) hours; 6. Failed to restrict on-premises consumption to the time an authorized bartender was present; and mm7. Failed to limit on-premises alcohol consumption to the bartending service hours of 7:00 P.m. until 11:00 p.m. The parents alleged that The Springs allowed Penney to leave intoxicated, and that it owed a duty to prevent such conduct/activity which resulted in Murrow's death. They also sought punitive damages against all of the defendants. ¶8 On May 14, 2021, the parents amended their petition to include a breach of contract claim against The Springs. They argued that the failure to properly enforce and implement policies applicable to the event created a duty of care to third parties. They also asserted negligence and breach of contract claims against the security company. They added a dram shop liability and negligence claim against Café 501. Later they changed the named defendant to Boulevard Steakhouse, as the commercial vendor who bartended for the wedding reception. ¶9 On June 4, 2021, The Springs filed a motion to dismiss the parents' lawsuit. The Springs argued that the alcohol policies and safety rules for its clients did not establish a duty to third parties, and that the parents lacked standing to assert a breach of contract claim. On June 10, 202, Weathercoat Security also filed a motion to dismiss arguing that it was not subject to dram shop liability. It also claimed, as a matter of law, Penney's actions were the intervening and superseding cause of the accident and resulting death. ¶10 In the parents' June 22, 2021, response to The Springs' Motion to Dismiss, they clarified that they were not stating a dram shop or social host liability claim against The Springs. They acknowledged that "The Springs was not a vendor and did not provide the alcohol that was consumed by Defendant Malcolm Penney" (Emphasis in original). ¶11 On August 5, 2021, the trial court denied both The Springs' and Weathercoat Security's Motions to Dismiss. By June 30, 2022, the parents had dismissed Weathercoat Security without prejudice, and on July 11, 2022, The Springs filed a motion for summary judgment. On August 1, 2022, the parents dismissed Boulevard Steakhouse with prejudice. Ten days later, on August 11, 2022, the trial court held a hearing on The Springs' Summary Judgment Motion. The substance of the hearing concerned the alleged duty of the commercial property owner to third parties. On August 29, 2022, the trial court granted The Springs' Motion for Summary Judgment, holding that The Springs did not owe a duty to the plaintiffs under Oklahoma law for the resulting acts of Penney. ¶12 The trial court's order provides in pertinent part: The Court finds that the common law rule applies to this set of facts. That law being, that 'a person has no duty to prevent a third person from causing a physical injury to another.' In addition, the Court finds that there is no statutory duty that the Court is aware of that would impose a duty on the defendants or apply in this case. The Court further finds that this set of facts do not place this case within any of the carved out exceptions that would impose liability on the defendant (Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300). This Court is of the opinion that to find a 'duty' on the part of the defendant to the plaintiff in this case, would be an expansion of current Oklahoma law that does not currently exist and for that reason the Court grants the defendant's Motion for Summary Judgment.* *The Court does not make a finding about an intervening cause because the Court's ruling resolved the matter without that finding. However, the Court is of the opinion that the actions of the defendant Malcolm Penney, is a supervening cause that would also prevent the plaintiffs from recovering against the defendant, The Springs Events. ¶13 On September 7, 2022, the parents filed a Motion to Vacate or Modify the Order, arguing there was newly discovered evidence. They indicated that the President of Operations of The Springs, in the week after the fatal accident, created a power point which stated that bartenders, event attendants, and security officers must know their policies and enforce them for every event. They argue that this power point illustrates that The Springs undertook a duty to enforce the venue's own alcohol policies, but that they negligently failed to enforce them. ¶14 On September 22, 2022, the parents dismissed Penney and his ex-wife with prejudice, leaving The Springs as the only remaining defendants. The trial court held a hearing on the Motion to Vacate on October 21, 2022, and denied it on November 9, 2022. The parents appealed on December 9, 2022, and we retained the cause on December 28, 2022. The cause was assigned for disposition on January 1, 2023, and the Court ordered additional appellate briefing which was completed on March 17, 2023. I. OKLAHOMA LAW DOES NOT RECOGNIZE A DUTY ON THE PART OF A PRIVATE EVENT VENUE EXTENDING TO THIRD PARTIES KILLED BY A VOLUNTARILY INTOXICATED ADULT WHO ATTENDED BUT WAS NOT "OVER-SERVED" BY IT. A. Standard of Review/Motion to Dismiss. ¶15 This cause was initially dismissed pursuant to a motion to dismiss. Consequently, the facts have not been determined, and are mere allegations. An order dismissing a case for failure to state a claim upon which relief can be granted is subject to de novo review.5 When reviewing a motion to dismiss, the Court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them.6 ¶16 The purpose of a motion to dismiss is to test the law that governs the claim in litigation, not the underlying facts.7 A pleading must not be dismissed for failure to state a legally cognizable claim unless the allegations indicate beyond any doubt that the litigant can prove no set of facts which would entitle the plaintiff to relief.8 ¶17 After the trial court's grant of summary judgment, the parents sought to vacate it by arguing that after the accident, The Springs' President of Operations created a duty of care to third parties when he created the power point. It emphasized that bartenders, event attendants, and security officers must know their policies and enforce them for every event. The trial court rejected their argument and denied their motion. ¶18 The trial court's disposition of a motion to vacate is generally reviewed for an abuse of discretion.9 Abuse-of-discretion is also determined by de novo review of the summary judgment order.10 B. There is No Liability To Third Parties For A Voluntarily, But Not "Over-Served" Intoxicated Adult. ¶19 It is undisputed that the parents' action against The Springs was not premised on the illegal, improper or over-service of alcohol. Even so, the parents argue that the same rationale in which the Court recognized a duty of care in Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300, applies to the facts of this cause. The Springs argues that Oklahoma law does not support a cause of action against a non-vendor of alcohol, nor did it voluntarily assume any duty towards third parties. Rather, it contends that it is the voluntarily intoxicated adult who is liable for any injuries they cause to third parties. ¶20 Courts may recognize a cause of action for negligence where they conclude that a defendant owed a duty of care to the plaintiff.11 However, to successfully state a cause of action for negligence, in addition to a duty of care, there must be failure to perform that duty. Injuries to the plaintiff must be proximately caused by the defendant's failure to exercise the duty of care.12 At common law, tavern owners were not held civilly liable for injuries to a third party caused by the acts of a voluntarily intoxicated person.13 This is because, as a matter of law, it was the voluntary consumption by the intoxicated person which was the proximate cause of the resulting injuries.14 ¶21 This changed in Oklahoma when the Court first modified the common law to recognize liability may exist in the context of a dram shop, (ie. a alcohol sales vendor) in Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300. Brigance involved a restaurant which sold intoxicating beverages illegally to a minor for on-the-premises consumption. The restaurant served the beverages to a group of minors, including the minor driver. It was alleged to have either caused the driver to become intoxicated or to increase his prior intoxication. The minor driver left the restaurant noticeably intoxicated and caused a one-car accident which injured a passenger. ¶22 The Court held that an alcohol vendor who sells intoxicating beverages for on-the-premises consumption has a duty to exercise reasonable care not to sell liquor to a noticeably intoxicated person. The Court stated that it was no longer unreasonable to expect a commercial vendor who sells alcoholic beverages for on-the-premises consumption to an already intoxicated person to foresee the unreasonable risk of harm to others. The duty of care was imposed by both statute and common law principles based the illegality of selling alcohol to minors, along with the duty not to subject another person to an unreasonable risk of harm. ¶23 Brigance concerned the illegally selling of alcohol to a minor. The linchpin to our imposition of a duty, at least implicitly, was factually due to the restaurant's selling or furnishing liquor to the minor. This was because the minor's previous or additional intoxication, may have lacked full capacity of self-control to operate the vehicle and injured a third party.15 Five years later, in Ohio Cas. Ins. Co. v. Todd, 1991 OK 54, 813 P.2d 508, this Court refused to extend Brigance to an adult consumer who was injured in a one-car accident after having been served alcohol at a bar. ¶24 Recently, in MeGee v. El Patio, 2023 OK 14, 524 P.3d 1283, by a five to four decision, the majority of the Court reaffirmed the holding of Ohio Casualty Ins. Co. v. Todd. Todd held that a voluntarily intoxicated adult does not have a cause of action against a commercial vendor for personal injuries or death resulting from his or her own intoxication. The facts in MeGee were alarming. MeGee involved a restaurant patron who was alleged to have been intentionally and negligently over-served. He was allegedly allowed to drive. He was also allegedly bet $200.00 that he could not make the nearly 70 mile trip to Oklahoma City, Oklahoma, to meet again at a bar later that night. He did not make it to Oklahoma City. He was killed when his vehicle rear ended a tractor-trailer en route. ¶25 The Court reaffirmed that the commercial alcohol vendor's statutory and common law duty was to protect innocent third parties, but not the voluntarily intoxicated adult. When an intoxicated adult only injured themselves, personal accountability was required, rather than an extension of accountability to the commercial vendor. However, a third party injured by a drunk driver may state a cause of action against the commercial vendor that over-served the driver. Harm to a third party, and the act of serving to an intoxicated adult customer and allowing the customer to exit the establishment, were all key to extending a commercial alcohol vendor's duty towards innocent third parties. ¶26 Here, the key elements are missing and the circumstances are vastly different. This commercial establishment was not a tavern which sells alcohol ---- it is merely an rental event venue. While there was harm to an innocent third party, there was no act or allegation of serving or over-serving by the facility. Furthermore, the parents' allegations, taken together with all reasonable inferences which may be drawn from them, do not indicate that anyone associated with The Springs knew or should have known that: Penney was driving when he left the venue; he had access to a car; or he was visibly intoxicated when he left. ¶27 Nor should The Springs policies regarding alcohol sales and safety create such a duty -- at least not under the alleged facts.16 To do so, would require of such businesses the onerous burden to control guests both before arrival, during visits to their property, and after leaving the facility. If a duty were created merely by event venues or other non-alcohol selling businesses implementing alcohol or safety measures without selling or serving alcohol, they would be better off not to implement any such measures. The remoteness of connection of The Springs' policies and that of Penney's alcohol consumption coupled with his own wilful, intentional misconduct, precludes us from imposing a duty of care in this cause, and it precludes the parents from recovering against The Springs. ¶28 The Court has not expanded liability towards third parties beyond a commercial tavern or alcohol vendor, nor has the Legislature addressed the question of whether a cause of action would lie against a business like The Springs. We agree that public policy, along with decent citizenry, should be to prevent or reduce drunk driving to keep people from being injured or killed. We also agree that businesses should have and enforce alcohol and safety policies to serve such a public policy. Nevertheless, placing the burden of liability to third parties on businesses such as The Springs is not provided by Oklahoma law. ¶29 Nor is this a case in which a special relationship between the intoxicated adult and the business should create such a duty.17 Even if we were to extend any prior rationale by recognizing such a duty of care, the voluntarily intoxicated adult, as a result of his or her own intoxication, is the proximate cause of any injuries to third parties under these facts. The actions of the President of Operations of The Springs, by creating a power point to reinforce their alcohol policies and enforce them at subsequent events doesn't supersede the actions of the voluntarily intoxicated adult. Accordingly, the parents are precluded from recovering against The Springs. The trial court did not err in denying the parents' Motion to Vacate/Modify. CONCLUSION ¶30 At common law tavern owners were not held civilly liable for injuries to a third party caused by the acts of a voluntarily intoxicated person.18 This is because, as a matter of law, it was the voluntary consumption by the intoxicated person which was the proximate cause of the resulting injuries.19 Although the Court has modified the common law in the context of dram shop liability, the modification does not extend to rental event venues when a voluntarily intoxicated adult attends an event but is not "over-served" by the venue or anyone affiliated with it. The trial court did not err in denying the parents' Motion to Vacate/Modify. ORDER OF THE DISTRICT COURT AFFIRMED. KANE, C.J., ROWE, V.C.J., KAUGER, WINCHESTER, EDMONDSON, GURICH, DARBY, KUEHN, JJ., concur. COMBS, J., disqualified. FOOTNOTES 1 On August 31, 2011, driving while intoxicated in Denton County, Texas; January 26, 2012, Driving Under the Influence in Oklahoma County, Oklahoma; January 9, 2013, Public Intoxication, Carter County, Oklahoma; October 31, 2013, Driving Under the Influence, 2nd offence, McPherson, Kansas Municipal Court; and October 23, 2018, Operating a Motor Vehicle while Intoxicated, 4th offence, 14th Judicial District Court of Calcasieu, Louisiana. 2 On November 23, 2021, Penney pleaded guilty in the District Court of Canadian County to the charge of Murder in the Second Degree and nolo contendere to the charge of Leaving the Scene of a Fatality Accident. On February 1, 2022, the trial court sentenced Penney to serve a life sentence for the murder conviction and ten years for leaving the accident scene. The sentences run consecutively and Penney is incarcerated. 3 The Event Contract for the wedding is attached to the July 11, 2022, Motion for Summary Judgement and Brief in Support of Defendant The Springs, LLC., as Exhibit 4. It outlines alcohol policies and provides: ALCOHOL: RELEASE OF LIABILITY: Client agrees to hold THE SPRINGS, its agents, employees, and officers harmless in the event of alcohol-related injuries to Client or Client's guests attending or returning from Event. All alcoholic beverages served on THE SPRINGS premises must be served by a SPRINGS preferred vendor bartening company, n independently contracts, ABLE licenses and insured bartending firm. BYOP setups are not permitted on THE SPRINGS property. Alcoholic beverages may not be consumed in the parking lot. All underage drinking is strictly prohibited on THE SPRINGS premises, even when provide by parents to their children. Client is permitted to have alcohol served by licensed and insured bartender up to six hours for Event. No shots are allowed. The serving of alcoholic beverages will cease by 11:00 p.m. Per State Law, no alcoholic beverages can be stored overnight on THE SPRINGS premises. No alcohol can be served or consumed until the authorized bartender is present. Non-compliance of any alcohol policies will result in forfeiture of damage deposit. No alcohol of any kind can be delivered or brought into the venue until two hours prior to the bartender arriving.. . . 4 The Event Contract also provided in pertinent part: . . .THE SPRINGS reserves the right to eject or cause to be ejected from the facilities any objectionable person or persons. . .The term 'objectionable person' shall include those persons who by virtue of disorderly conduct, drunkenness, disruptive behavior, violation of the THE SPRINGS policies, or violation of local, state or federal laws, make the normal and proper conduct of business or the enjoyment of the Event difficult or impossible for others. 5 Harwood v. Ardagh Group, 2022 OK 51, ¶14, P.3d 473; Tuffy's Inc. v. City of Oklahoma City, 2009 OK 4, ¶6, 212 P.3d. 1158; Gens v. Casady School, 2008 OK 5, ¶8, 177 P.3d 565. 6 Harwood v. Ardagh Group, see note 5, Tuffy's Inc. v. City of Oklahoma City, see note 5, supra; Gens v. Casady School, see note 5, supra. 7 Harwood v. Ardagh Group, see note 5, Tuffy's Inc. v. City of Oklahoma City, see note 5, supra; Gens v. Casady School, see note 5, supra. 8 Harwood v. Ardagh Group, see note 5, Tuffy's Inc. v. City of Oklahoma City, see note 5, supra; Gens v. Casady School, see note 5, supra. 9 CPT Asset Backed Certificate, Series 2004--EC1 v. Cin Kaham, 2021 OK 22, ¶3, 278 P.3d 586; Washington v. Tulsa County, 2006 OK 92, ¶10, 151 P.3d 121; Ferguson Enterprises, Inc. v. Webb Enterprises, Inc., 2000 OK 78, ¶ 5, 13 P.3d 480. An abused judicial discretion is manifested when discretion is exercised to an end or purpose not justified by, and clearly against, reason and evidence. Patel v. OMH Med. Ctr., Inc., 1999 OK 33, ¶ 20, 987 P.2d 1185. An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law, or where there is no rational basis in evidence for the ruling. Fent v. Oklahoma Natural Gas Co., 2001 OK 35, ¶ 12, 27 P.3d 477. 10 Andrew v. Depani-Sparkes, 2017 OK 42, ¶27, 396 P.3d 210; Reeds v. Walker, 2006 OK 43, ¶9, 157 P.3d 100. 11 Mansfield v. Circle K. Corporation, 1994 OK 80, ¶6, 877 P.2d 1130; Busby v. Quail Creek Golf and Country Club, 1994 OK 63, ¶6, 885 P.2d 1326. 12 Smith v. City of Stillwater, 2014 OK 42, ¶22, 328 P.3d 1192; Berman v. Laboratory Corp. of America, 2011 OK 106, ¶16, 268 P.3d 68; Smith v. Hines, 2011 OK 51, ¶12, 261 P.3d 1129. 13 Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, ¶8, 725 P.2d 300. 14 Brigance v. Velvet Dove Restaurant, Inc., see note 13, supra. 15 Regarding minors, in Tomlinson v. Love's Country Stores, Inc., 1993 OK 83, held that whether the alcohol sold to a minor was for on-the-premises or off-the-premises consumption. We later held in Busby v. Quail Creek Golf and Country Club, 1994 OK 63, 885 P.2d 1326 because a commercial vendor was prohibited by statute from selling beer to minors, if the minor was injured as a result of the vendor's negligence after consuming the beer purchased from the vendor, the minor might have a cause of action against the vendor. In Mansfield v. Circle K. Corporation, 1994 OK 80, 877 P.2d 1130, we held that the holding of Busby was not limited to on-the-premises consumption. The premise of liability for all of the "minor" cases was based upon negligence per se and the statutory prohibition against selling alcohol to minors. 16 Without providing alcohol directly to Penney or profiting from alcohol sales to him, The Springs is more closely aligned with a social host in which no liability can be imposed. Kellog v. Ohler, 1992 OK 18, ¶¶1-2, 825 P.2d 1345. 17 In the proceedings below, the parents also argued the rationale of cases like Harwood v. Ardagh Group, 2022 OK 51, 522 P.3d 473, and others, in which the defendant employer may have assumed a duty by taking action to thwart harm to employees crossing the street. However, a key element in the rationale of Harwood was an employer/employee relationship which does not exist here. Even if a similar or special relationship existed, in the context of alcohol consumption, it is the action of the voluntarily intoxicated adult who is responsible. 18 Brigance v. Velvet Dove Restaurant, Inc., see note 13, supra. 19 Brigance v. Velvet Dove Restaurant, Inc., see note 13, supra.

ea98a20a-6ee9-49c2-9a83-d9c0960cdd2e

IN THE MATTER OF THE ESTATE OF LANDING

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ESTATE OF LANDING2023 OK 117Case Number: 120759Decided: 12/12/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. In the Matter of the Estate of GEORGE VERNON LANDING, JR., Deceased. EMMA G. LANDING, Appellant, v. JIM C. McGOUGH, Personal Representative of the Estate of George Vernon Landing, Jr., Appellee. ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY, STATE OF OKLAHOMA; HONORABLE KELLY GREENOUGH, DISTRICT JUDGE ¶0 Appellant sought to remove the current administrator of her father's estate, claiming that under 58 O.S. § 135, she has superior right to the role and the court had no discretion to refuse her request. The District Court of Tulsa County, the Honorable Kelly Greenough, disagreed and denied Appellant's request. We hold that the trial court had discretion in the matter and did not abuse that discretion when it denied Appellant's motion. ORDER OF THE DISTRICT COURT AFFIRMED Emily S. Eleftherakis, Oklahoma City, OK for Appellant. Catherine Welsh, Tulsa, OK for Appellee. KUEHN, J. ¶1 George Landing, Jr. was tragically killed when his truck was hit by a motorist driving the wrong direction on the Turner Turnpike. Landing was divorced. He left behind two minor daughters. He left no will. One of the daughters, Emma, is the Appellant here. Among Landing's assets is the potential for his estate to recover in a wrongful-death action. This case involves a third-party administrator and personal representative for Landing's estate, the possibility of monetary recovery from the accident, and a succession of lawyers interested in participating in the wrongful-death suit. The issue presented is whether the trial court has discretion to deny removal of a third-party administrator when requested to do so by one of the family members listed in 58 O.S. § 135. ¶2 Landing died in July 2015. In August his ex-wife, Dana Landing (now Beagles), acting as their daughters' guardian, petitioned to be administrator of Landing's estate. The request was granted. In December 2015 Beagles, acting as personal representative of the estate, filed a wrongful-death action in Tulsa County. That action remains pending.1 A local attorney with experience in probate matters, Appellee Jim McGough, was appointed general guardian to Landing's daughters. In early 2018, Beagles voluntarily resigned as administrator of the estate and named McGough to take her place. McGough was also substituted as the estate's personal representative in the wrongful-death suit. ¶3 An estate's representative chooses the attorneys who will prosecute civil suits on the estate's behalf. See generally 58 O.S. § 11. Since McGough's appointment, there have been many attempts to remove him from both of his roles. These attempts stem from Beagles's discussions with various lawyers interested in participating in the wrongful-death suit. Because McGough apparently did not agree to substitute the lawyers Beagles wanted for the lawyers he had already retained, in May 2020 Beagles tried to have him removed as administrator. The trial court concluded Beagles lacked standing to make such a challenge. ¶4 Just days after her eighteenth birthday in March 2021, Emma Landing made her own request to remove McGough and assume the roles of administrator and personal representative. That request was denied after a hearing. A second request, in July 2021, was later stricken by agreement. In June 2022, Emma filed the instant request to replace McGough. At a hearing in August 2022, the trial court granted an unopposed motion to end McGough's guardianship over both Emma and her younger sister, but it denied Emma's request to take McGough's place as administrator. Emma appealed, and we retained the case for decision. STANDARD OF REVIEW ¶5 Probate proceedings are of equitable cognizance. We presume that the trial court's decision is correct and will not disturb it unless it is clearly contrary to the weight of the evidence. In re Estate of Fulks, 2020 OK 94, ¶ 9, 477 P.3d 1143. This case also involves questions of statutory interpretation; those questions are reviewed de novo. Id. De novo review affords this Court plenary, independent, and non-deferential authority to interpret the law. Schlumberger Technology Corp. v. Paredes, 2023 OK 42, ¶ 3, 528 P.3d 772. ANALYSIS A. Whether the appeal is foreclosed as res judicata. ¶6 In his response to Emma's Petition in Error, McGough claims Emma is barred from appealing the trial court's August 2022 ruling because she could have appealed the court's March 2021 denial of the same request but failed to do so. We disagree. ¶7 Emma's present attempt to remove McGough is based on the same grounds as her first attempt in March 2021. The question presented is one of law. Focusing on the language of 58 O.S. § 135, Emma claims that as Landing's adult daughter, her right to the role of administrator is superior to McGough's, and the court was required to grant her request. ¶8 The doctrine of claim preclusion, or res judicata, holds that parties (or their privies) may not relitigate issues once a final judgment on the merits has been rendered. In the Matter of the Estate of Sneed, 1998 OK 8, ¶ 13, 953 P.2d 1111. Failure to seek review of a trial court's adverse ruling on a particular claim, after final disposition on the merits, usually precludes any future attempt to have the claim reviewed. But the legislature has determined that certain interlocutory orders (those rendered before final judgment) are appealable by right, and many probate orders, including the instant one, fall in this category. 58 O.S. § 721(1) (appeal may be taken from any grant, refusal to grant, or revocation of letters of administration); Sup.Ct. Rule 1.60(h). While these rulings may be appealed before final judgment, failure to take an interlocutory appeal does not bar the aggrieved party from raising the claim at a later date. Sup.Ct. Rule 1.40(f). Res judicata will not bar review of probate orders that could have been challenged previously but were not. Sneed, 1998 OK 8, ¶ 13 & n.15. See also In re Estate of Caldwell, 1984 OK 92, ¶ 6 n.8, 692 P.2d 1380 (untimely attempt to appeal interlocutory probate order would not prevent litigant from re-asserting the claim later). ¶9 Furthermore, the essence of Emma's claim is that she should have the right, as the estate's personal representative, to guide the wrongful-death lawsuit -- a suit that could produce the largest asset of the estate. Such a right, if it exists, is meaningless if not conferred while that lawsuit is ongoing. See 58 O.S. § 721(10) (interlocutory appeal may be taken from any order in probate that "affect[s] a substantial right"); see also In re Guardianship of Berry, 2014 OK 56, ¶¶ 36-39, 335 P.3d 779 (interlocutory order on choice-of-counsel in guardianship matter was appealable before final judgment under 58 O.S. § 721(10)). We conclude that Emma's timely appeal from the August 2022 ruling is not barred by res judicata. B. Whether the trial court erred in denying Emma's request to take McGough's place as administrator. ¶10 Emma claims she has superior right to the role of administrator vis a vis McGough and therefore enjoys the absolute right to take his place. She claims it is not her burden to show, as a preliminary matter, that she is competent to replace him, but rather that it was McGough's burden to show that she is not competent to serve, and that he failed to meet that burden. ¶11 Since Landing was unmarried at the time of his death, his daughters were next on the preferred list of potential administrators. 58 O.S. § 122(2). At the time, however, both girls were minors and thus ineligible to serve. 58 O.S. § 126(1). The girls' mother, Beagles, acting as their guardian, stepped into their shoes to take preferred position as administrator. 58 O.S. § 125; Sparks v. Steele, 1972 OK 127, ¶ 13, 501 P.2d 1106. Later, Beagles voluntarily stepped down as administrator and nominated McGough to take her place. 58 O.S. § 134; Hesler v. Snyder, 1967 OK 4, ¶ 21, 422 P.2d 432. ¶12 Emma doesn't challenge her mother's ability to nominate a third party, or McGough's qualifications to accept it. Nor does she claim that McGough has done (or failed to do) anything since his appointment that would warrant removal. She simply claims that she has the absolute right to rescind that appointment under the applicable law. We disagree. ¶13 Our probate code sets out rules for the appointment, challenge, and removal of personal administrators. For the initial appointment, the law provides a list of those who must be given the opportunity to serve, in order of preference, as well as a list of those who may not serve. Those who may not serve include minors; those convicted of an "infamous crime"; those deemed "incompetent," which we discuss shortly; and anyone who was in a partnership with the deceased. 58 O.S. §§ 126, 122(8). These impediments aside, the ordinal list of potential candidates begins with a surviving spouse and continues to others in the following order: children, parents, siblings, grandchildren, other next of kin, creditors and, finally, "[a]ny person legally competent." 58 O.S. § 122. ¶14 The trial court has no discretion to ignore this ordered list of preferred candidates. In re Enochs' Estates, 1958 OK 40, ¶ 7, 322 P.2d 197. But it does have discretion at many points in the process, including many potential scenarios of initial appointment. Note that every class of candidates except surviving spouse could include more than one person: the deceased's "children," his "father or mother," or his "brothers or sisters," and so on. 58 O.S. § 122. When priority is shared by a class containing more than one person, the court may, in its discretion, grant letters to "one or more of them." 58 O.S. § 124. Also, if the person entitled to priority is a minor, the court may, in its discretion, appoint the child's guardian "or any other [competent] person" as administrator. 58 O.S. § 125; Copperfield's Estate, 1932 OK 471, ¶ 10, 12 P.2d 490. ¶15 Even when priority of appointment falls to a single person in the list, such as the surviving spouse or an only child, the court must still use discretion to determine if that person is competent to serve. The term "competent" has a particular meaning in probate matters. It is defined in 58 O.S. § 126, which lists those who may not serve as administrator. The court cannot appoint someone who is "incompetent to execute the duties of the trust by reason of drunkenness, improvidence or want of understanding or integrity." Id. "Improvidence" also has a special meaning in these matters: ["Improvidence" means] that want of care and foresight in the management of property which would be likely to render the estate and effects of the intestate unsafe and liable to be lost or diminished in value, in case the administration should be committed to the improvident person. Wyche v. Wyche, 1961 OK 211, ¶ 16, 365 P.2d 993 (citation omitted).2 ¶16 When a petition for letters of administration is filed, interested parties have thirty days to contest it. 58 O.S. §§ 127-29. At the hearing, letters must be granted to any applicant "though it appears that there are other persons having better rights to the administration when such persons fail to appear and claim [the right for] themselves." 58 O.S. § 132. ¶17 One entitled to serve under Section 122 may nominate any other competent person to serve in her place. See 58 O.S. § 122(1) (surviving spouse may nominate another person to serve); 58 O.S. § 134 (any person entitled to serve may nominate another). Waiver of the right to serve is unconditional and cannot be reversed. Enochs' Estates, 1958 OK 40 at ¶ 15 ("the person qualified must either accept the appointment for himself or waive the right absolutely"). Nomination of another has the same effect. See In re Bedell's Estate, 32 P. 323 (Cal. 1893) (having once nominated an administrator, an heir cannot change his mind and seek letters himself or nominate another). Beagles, who first served as administrator because she was guardian to Landing's daughters, eventually nominated McGough to take her place. And that power to nominate is at issue in this case. ¶18 Emma's argument is based on her reading of 58 O.S. § 135, which immediately follows the section allowing any person with the right to serve to nominate any other competent person to do so. Section 135 provides: When letters of administration have been granted to any person other than the surviving husband or wife, child, father, mother, brother, or sister of the intestate, any one of them may obtain the revocation of the letters and be entitled to the administration, by presenting to the county court a petition praying the revocation, and that letters of administration be issued to him.3 58 O.S. § 135. If, at a hearing on the matter, "the right of the applicant is established and he is competent, letters of administration must be granted to him, and the letters of the former administrator revoked." 58 O.S. § 137. ¶19 Emma reads Sections 135 and 137 to mean that any listed family member may, at any time, demand the removal of any administrator who is not on that list, regardless of whether the initial appointment was valid, and without any burden to show incompetency or malfeasance on the part of the incumbent. We believe this interpretation is flawed. It is clearly at odds with Section 134: A preferred person's right to nominate any competent person to serve in their stead. ¶20 The goal of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by the statutory language. Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521. Statutes dealing with the same subject are generally viewed as in pari materia, and must be construed as a "harmonious whole." Taylor v. State Farm Fire & Cas. Co., 1999 OK 44, ¶ 19, 981 P.2d 1253. Courts should not interpret laws to mean something the legislature did not intend or express, especially where that interpretation leads to absurd results. Toch, LLC v. City of Tulsa, 2020 OK 81, ¶ 29, 474 P.3d 859. ¶21 The trial court's overarching duty in probate matters is to ensure the protection of the estate and its orderly administration and distribution. To that end, the court has a continuing duty to monitor the fitness of an administrator, and take remedial action on its own motion if necessary. 58 O.S. §§ 234, 235. For his part, the administrator has a fiduciary duty not only to heirs, but to other beneficiaries of the estate as well. As a fiduciary and officer of the court, the administrator must represent all beneficiaries equally, without favor to one over the other. 1 Okla.Prob.Law & Practice § 14.67. Sometimes, the estate's beneficiaries include parties beyond the decedent's heirs. That is the case here. The most valuable asset in Landing's estate is the potential for recovery in the lawsuit over his death. While Landing's daughters are his only heirs at law, Landing's parents have an interest in the lawsuit, as they are entitled to receive a portion of any damages that may be realized. 12 O.S. § 1053. ¶22 Did our legislature intend to give certain family members the right to intervene and remove a duly appointed administrator, at any time and without cause? We think not. The fallacy in Emma's argument is demonstrated by a simple example. We know Emma's mother, Beagles, acting as the girls' guardian, initially served as administrator and later nominated McGough. We also know that Beagles was behind the first attempt to remove McGough. But suppose that Beagles had still been married to Landing at the time of his demise, that she took the role of administrator as surviving spouse, that she nominated McGough to take her place, and that she is currently content with that situation. Under Emma's theory, even a surviving spouse's choice to nominate another could be reversed at any time by any family member listed in Section 135. ¶23 What is the point of having the right to nominate another, if that choice can be nullified at whim by select members of the family? Emma doesn't claim a special exception should lie for the particular facts in this case. She claims any family member listed in Section 135 has the right, at any time, to remove any administrator who is inferior in priority to the challenger under Section 122. Such a reading would render the right to nominate effectively useless. It could force one with priority, who no longer wishes to serve, to retain the title if only to prevent another family member with inferior right from usurping the role. The legislature cannot have intended such an absurd result.4 ¶24 Emma's interpretation presents other related problems. Section 135 permits "any one of" the listed family members to make a challenge. There is no order of priority. Hence, a listed family member might challenge the acting administrator regardless of where the challenger stands in relation to other family members -- even those in Section 135 itself. With no order of priority, the result might be a melee of challenges and counter-challenges by family members listed in Section 135, pitting those who are happy with the current administrator against those who are not, those who would prefer that this relative serve instead of that one, etc. We believe Sections 135 to 138 simply ensure that certain family members, who may have been entitled to initial appointment under Section 122 but didn't receive timely notice and opportunity to contest that appointment within thirty days, have a chance to do so.5 That request is still subject to trial court discretion. Cf. Smith v. Gould, 1967 OK 207, ¶¶ 16-17, 434 P.2d 176. But that is not the situation here. The trial court's initial appointment of Beagles adhered to Sections 122 and 125, and Emma does not claim otherwise. ¶25 Emma's interpretation divests one entitled to serve as administrator of the right, clearly expressed in both Sections 122(1) and 134, to nominate another to serve in her place. It frustrates the orderly and efficient settlement of estates by leaving nominees perpetually vulnerable to removal, regardless of whether the nomination was valid at the time it was made, and regardless of how long and effectively the incumbent may have served. It would lead to uncertainty and confusion in an area of law already prone to family drama. ¶26 Importantly, Emma does not claim any malfeasance, neglect, or other problem with McGough's performance, or the performance of the attorneys currently handling the wrongful-death suit. The issue boils down to lawyer preference. Both Emma and McGough testified at the hearing. In denying Emma's request, the trial court noted her age and general inexperience in the kinds of decisions she would be required to make as administrator and personal representative. As we have noted, "competency" has a specific meaning in probate matters. The trial court did not find that Emma's request should be denied because she was incompetent to serve. Rather, the court found -- as we do -- that, as a matter of law, it had discretion whether to remove McGough in the first place, and it considered the testimony of both before concluding that there was no good reason to do so. We cannot say the trial court abused its discretion. ORDER OF THE DISTRICT COURT IS AFFIRMED ALL JUSTICES CONCUR. FOOTNOTES 1 McGough v. Inventiv Commercial Services LLC et al., Tulsa County Case No. CJ-2015-4675. 2 This special connotation of "competent" and "incompetent" is common in probate matters. See generally 113 A.L.R. 780 (Introduction). 3 Similarly, Section 138 provides in part: The surviving husband or wife, when letters of administration have been granted to a child, father, mother, brother or sister of the intestate, or any of such relatives when letters have been granted to any other of them, may assert his prior right, and obtain letters of administration, and have the letters before granted revoked... . 4 The California Supreme Court expressed the same sentiment in In re Bedell's Estate, 32 P. 323, where it addressed a similar claim affecting the right to nominate: This construction would, however, deprive the provisions of section 1379, Id., of the effect to which its language is entitled. That section provides that 'administration may be granted to one or more competent persons, although not otherwise entitled to the same, at the written request of the person entitled, filed in the court.' If the relative right of appointment is to be determined by the order in which the parties entitled are enumerated in section 1365, and the nominee of any of the classes therein named, other than that of the husband or wife, is not to be regarded by the court, this provision of section 1379 would lose all effect. The fact that the person entitled is permitted to make a request that administration be granted to a person 'not otherwise entitled' must receive some consideration in the construction of the statute, for it is not to be supposed that the legislature has given such permission merely to have the request denied. The evident purpose of the provision is to give to the one entitled to administration the power to select some competent person to discharge the duties of the office; but to hold that his request is not to be considered when resisted by one who belongs to a class subsequent in rank to his own would be to confine his selection to some person falling within the class immediately after his own. Id. at 341 (emphasis added). 5 See King v. Salyer, 1935 OK 395, 44 P.2d 11 (deceased's brother waived his right to appointment in favor of sister; sister sought appointment as administrator, claiming their father, who had prior right, was deceased; deceased's father later appeared and moved to exercise his prior right to appointment, claiming the suggestion of his demise was fraudulently made).

f5f88183-af3e-43ed-8f67-886d36a0857b

U.S. Bank National Assoc. v. Hill

oklahoma

Oklahoma Supreme Court

U.S. BANK NATIONAL ASSOC. v. HILL2023 OK 86Case Number: 118680Decided: 09/12/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. U.S. BANK NATIONAL ASSOCIATION, As indenture trustee for Sasco Mortgage Loan Trust 2004-GEL2 Mortgage Backed Notes, Series 2004-GEL2, Plaintiff/Appellant, v. CARMELA D. HILL, Defendant/Third-Party Plaintiff/Appellee/Counter-Appellant, v. NATIONSTAR MORTGAGE, LLC, Third-Party Defendant/Appellant. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION I DISTRICT COURT OF TULSA COUNTY, STATE OF OKLAHOMA HONORABLE REBECCA NIGHTINGALE, TRIAL JUDGE ¶0 Borrower pursued counterclaims against bank and its mortgage servicer following bank's dismissal of its foreclosure action against borrower. A jury returned a verdict against bank on borrower's wrongful foreclosure claim and a verdict against the mortgage servicer on multiple claims including violations of the Oklahoma Consumer Protection Act (OCPA) and the Fair Debt Collection Practices Act (FDCPA). The trial court awarded attorney's fees and costs to borrower. Bank and mortgage servicer appealed and borrower counter-appealed. The Oklahoma Court of Civil Appeals dismissed in part borrower's appeal and found neither the OCPA or the FDCPA was applicable. It reversed the attorney's fee award and reduced the amount of awarded costs. In addition, it reversed the wrongful foreclosure judgment against bank and affirmed the remainder of the judgment which concerned breach of contract and tort claims against the mortgage servicer. COURT OF CIVIL APPEALS' OPINION VACATED; HILL'S COUNTER PETITION IN ERROR DISMISSED IN PART; JUDGMENT AFFIRMED IN PART AND REVERSED IN PART; CASE REMANDED FOR FURTHER PROCEEDINGS Michael J. McKleroy, Jr., Akerman LLP, Dallas, Texas for appellants U.S. Bank National Association and Nationstar Mortgage, LLC1 Kris Ted Ledford, Ledford Law Firm, Owasso, Oklahoma and Patrick H. Kernan, Wilburn, Masterson & Hampton, Tulsa, Oklahoma, for appellee/counter-appellant, Carmela D. Hill Combs, J. I. FACTS AND PROCEDURAL HISTORY ¶1 On September 6, 2002, the Defendant/Third-Party Plaintiff/Appellee/Counter-Appellant, Carmela D. Hill (Hill) executed a promissory note and mortgage in favor of Specialized Financial Services, Inc., dba SFM Mtg (SFM). According to the note, Hill agreed to pay $100,130.00 plus interest at a yearly rate of 10.130%. The note required Hill to pay on the first day of each month and stated a default would occur if she did not pay the full amount of each monthly payment on the date it is due. It also provided that if Hill still owed any "amounts" under the note, she will pay those amounts in full by the maturity date, October 1, 2032. The Plaintiff/Appellant, U.S. Bank National Association, As indenture trustee for Sasco Mortgage Loan Trust 2004-GEL2 Mortgage Backed Notes, Series 2004-GEL2 (U.S. Bank) owned Hill's loan since June 1, 2004. Aurora Bank, FSB fka Aurora Loan Servicing, LLC (Aurora) was the mortgage servicer prior to the Third-Party Defendant/Appellant, Nationstar Mortgage, LLC (Nationstar). ¶2 Hill breached her loan obligations numerous times over the ten-year period following the original loan date. Aurora filed at least four foreclosure actions against Hill and entered into many repayment agreements with her. On June 5, 2012, Hill was notified by Aurora that her "mortgage payments of $3,347.72 for the months of May 01, 2012 and June 01, 2012 plus accrued late charges of $36.93 are past due." Less than a month later, Nationstar began servicing the loan effective July 1, 2012. On September 4, 2012, Nationstar notified Hill by letter that it was seeking to collect a debt from her in the amount of $4,547.92 which includes the sum of payments which came due on or after July 1, 2012, the date the letter claimed was the date of default. As the new servicer of the loan, Nationstar sued to foreclose the mortgage and obtained a judgment on June 25, 2013.2 In July 2013, Nationstar entered into a loan modification agreement with Hill and thereafter vacated the judgment of foreclosure without prejudice. ¶3 Almost a year later, Hill was again notified by Nationstar that she was in default. On September 2, 2014, Hill contacted Nationstar and verbally applied for a deed in lieu of foreclosure (DIL). Nationstar contacted a law firm which in turn contacted Stewart Title to issue any necessary title commitments. Stewart Title issued a title commitment effective September 24, 2014, and required the mortgage to be released as a condition to issuing any title policy. Hill was informed that she was conditionally approved for the DIL and Nationstar sent her the required documents which she signed in November 2014. Nationstar executed the DIL agreement as well as a release of mortgage and a deficiency waiver and forwarded the documents to its law firm to complete the DIL. Nationstar also paid Hill $8,000.00 and reported the loan to the credit reporting agencies as satisfied through a DIL. Nationstar did not record the DIL or the mortgage release. ¶4 In June 2015, Nationstar entered into a contract to sell the property to a third party. Nationstar's law firm prepared an assignment of mortgage from the original lender (SFM) to Nationstar. The law firm believed this assignment was necessary to clear any assignment chain issues and it could not record the DIL or release of mortgage without the assignment. Nationstar was unable to locate SFM and therefore it was unable to execute the assignment required by its law firm. Believing it had the right to do so, Nationstar canceled the DIL on February 1, 2016 and returned the loan to the status it was in prior to the DIL approval. Nationstar resumed normal default servicing and referred the matter to foreclosure. On March 16, 2016, Nationstar executed a corporate assignment of mortgage to U.S. Bank. On March 29, 2016, U.S. Bank filed its petition for foreclosure. Thereafter, Hill began receiving more than 50 written communications from Nationstar advising her that she owed money on her mortgage loan. Nationstar also made repeated statements about the status of her loan to credit bureaus. ¶5 The foreclosure petition prayed for a judgment, in personam and in rem, in the amount of $129,662.64 plus interest and various expenses. Hill answered the petition and counterclaimed against U.S. Bank as well as Nationstar as a third-party defendant. Hill's counterclaims included: 1) breach of contract; 2) tortious breach of contract; 3) violation of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq.; 4) violation of the Oklahoma SAFE Act, 59 O.S. § 2905 et seq.; 5) negligence/negligence per se; 6) false representation; 7) constructive fraud; 8) actual fraud; 9) alternative allegation of negligent misrepresentation; 10) violation of the Oklahoma Consumer Protection Act (OCPA), 15 O.S. 2011, § 751 et seq.; 11) wrongful foreclosure; 12) violation of the Real Estate Settlement Procedures Act (Regulation X), 12 U.S.C. 2601 et. seq., 12 C.F.R. Ch. X, Pt. 1024; 13) failure to release mortgage in violation of 46 O.S. § 15; and 14) violation of the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681. Hill contended the actions of Nationstar and/or U.S. Bank caused her to incur attorney's fees, harmed her credit, caused her physical and mental pain, and caused her to refrain from pursuing job opportunities. ¶6 U.S. Bank dismissed the foreclosure lawsuit without prejudice on December 12, 2018, and released the mortgage. Nationstar recorded a replacement warranty deed in lieu of foreclosure with the Tulsa County Clerk on January 8, 2019. Hill continued to pursue her counterclaims. A five-day jury trial began on October 21, 2019. The trial focused on Hill's wrongful foreclosure claim against U.S. Bank and her third-party claims against Nationstar which included breach of contract, tortious breach of contract, negligence, and violations of the OCPA and FDCPA. Her many other claims had either been voluntarily dismissed or disposed of by the trial court prior to the end of the trial. Hill had also pursued Category I and II punitive damages. U.S. Bank and Nationstar made motions for directed verdict on many issues including Hill's claims concerning wrongful foreclosure, the OCPA, the FDCPA and punitive damages. The trial court granted directed verdict on the Category II punitive damages claim but denied the rest. ¶7 The jury found U.S. Bank liable on Hill's wrongful foreclosure (malicious prosecution) claim and Nationstar liable on Hill's claims of breach of contract, tortious breach of contract, negligence and violation of both the FDCPA and the OCPA. On January 27, 2020, a judgment was entered jointly against U.S. Bank and Nationstar for actual damages of $225,000.00 plus an additional amount of $5,427.99 for prejudgment interest (a total amount of $230,427.99). The jury also found that U.S. Bank and Nationstar had acted "in reckless disregard of the rights of others." The finding by clear and convincing evidence that a defendant has acted in "reckless disregard for the rights of others" is a necessary element of Category I punitive damages. 23 O.S. 2021, § 9.1 (B). Even though the jury found both U.S. Bank and Nationstar had acted "in reckless disregard of the rights of others" it determined, in second stage proceedings, that "no punitive damages" should be awarded against U.S. Bank. Hill was awarded Category I punitive damages exclusively against Nationstar in the amount of $225,000.00 and was further awarded statutory damages exclusively against Nationstar in the amount of $1,000.00 under the FDCPA (a total amount of $226,000.00). Hill also filed a motion for attorney's fees and costs against Nationstar. The basis for an award of attorney's fees was upon the jury's finding that Nationstar was liable under the FDCPA and OCPA. The trial court entered judgment on February 26, 2020, and awarded Hill attorney's fees in the amount of $389,040.00 and costs in the amount of $12,692.85 (a total amount of $401,732.85). This award of attorney's fees and costs was against Nationstar only. ¶8 All three parties appealed on various grounds. U.S. Bank and Nationstar filed a (joint) petition in error on February 28, 2020. Hill filed a counter- petition in error on March 16, 2020. Nationstar filed a supplemental petition in error on March 19, 2020, to address the trial court's February 26, 2020 judgment concerning attorney's fees and costs. U.S. Bank appeals the denial of its motion for directed verdict on the wrongful foreclosure claim and the resulting judgment in Hill's favor. Nationstar appeals the denial of its motion for directed verdict on the FDCPA and OCPA claims and the resulting judgment on those claims which formed the basis for an award of attorney's fees as well as statutory damages. It argues the award of both punitive damages and attorney's fees, as well as statutory damages, constitutes double recovery and the amount awarded was not apportioned and is excessive. Nationstar also challenges some of the costs assessed against it. It does not challenge its liability under the breach of contract, tortious breach of contract and negligence claims or the Category I punitive damages award. Nor does it challenge the actual damages and prejudgment interests awarded. Hill appealed the trial court's granting of the motion for directed verdict on Category II punitive damages. Hill also challenges the court's denial of an attorney's fee enhancement and the capping of the attorney's fee award related to the OCPA claim at $10,000.00. ¶9 Nationstar filed a partial motion to dismiss on December 7, 2020. Nationstar asserted Hill's appeal of the court's directed verdict on her claim for Category II punitive damages is moot because she accepted payment from Nationstar and thus accepted the benefit. Nationstar attaches an affidavit supporting Nationstar's claim that it fully paid the journal entry of judgment granting Hill actual damages in the amount of $225,000.00, statutory damages in the amount of $1,000.00, punitive damages in the amount of $225,000.00, prejudgment interest in the amount of $5,427.99 and post-judgment interest at the rate of 6.75% from January 28, 2020. The payments were made on April 1 and 6, 2020, approximately one month after the petition in error was filed. On December 14, 2020, this Court deferred the disposition of the partial motion to dismiss to the decisional stage of the appeal. ¶10 On March 30, 2022, the Oklahoma Court of Civil Appeals (COCA) affirmed the trial court in part and reversed it in part. The court held in favor of Nationstar on its motion for partial dismissal, finding Hill had accepted payment on punitive damages and it found there was no precedent for affirming Category I punitive damages and reversing the trial court's decision regarding Category II punitive damages. The court held in favor of U.S. Bank on the wrongful foreclosure (malicious prosecution) claim and found that Nationstar was exempt from the provisions of the OCPA. It also held the FDCPA was not applicable because it determined Nationstar was not a debt collector for purposes of the FDCPA. Having found that neither the OCPA nor the FDCPA applied, it determined the issue regarding double recovery was moot and it reversed the trial court's award of attorney's fees, i.e., there was no basis for such an award other than under the OCPA and FDCPA claims. The court also found that some of the costs awarded by the trial court were unauthorized and reversed its ruling on those costs. Hill petitioned this Court for certiorari which was granted on December 12, 2022. II. STANDARD OF REVIEW ¶11 In ruling on a motion for directed verdict a trial court must consider as true all evidence and all inferences reasonably drawn therefrom that is favorable to the party against whom the motion is made; any conflicting evidence favorable to the movant must be disregarded. Woods v. Fruehauf Trailer Corp., 1988 OK 105, ¶8, 765 P.2d 770, 773. However, when the party opposing the motion for directed verdict has failed to demonstrate a prima facie case for recovery, then a motion for directed verdict should be granted. Gillham v. Lake Country Raceway, 2001 OK 41, ¶7, 24 P.3d 858, 860. A trial court's denial of a motion for directed verdict is reviewed de novo. Badillo v. Mid Century Ins. Co., 2005 OK 48, ¶24, 121 P.3d 1080, 1092. ¶12 An attorney's fee award is recoverable to a prevailing party only for the work attributable to a claim for which fees are statutorily recoverable. Lee v. Griffith, 1999 OK 32, ¶5, 990 P.2d 232, 233. "Oklahoma does not have an 'inextricably intertwined' theory upon which attorney fees do not have to be apportioned if the claims are closely related." Combs v. Shelter Mut. Ins. Co., 551 F.3d 991, 1001-02 (10th Cir. 2008). The applicant for attorney's fees bears the burden of proving the time and labor for which compensation is sought are reasonable and they relate to a claim for which fees are recoverable. Harolds Stores, Inc. v. Dillard Dep't Stores, Inc., 82 F.3d 1533, 1553 (10th Cir. 1996). What constitutes a reasonable attorney's fee award is a matter addressed to the sound discretion of the trial court to be decided based on various factors and a judgment awarding such fees will not be reversed absent an abuse of discretion. Tibbetts v. Sight "n Sound Appliance Centers, Inc., 2003 OK 72, ¶3, 77 P.3d 1042, 1046, as corrected (Sept. 30, 2003). An abuse of discretion occurs when the ruling being reviewed is based on an erroneous legal conclusion or there is no rational basis in the evidence for the decision. Id. The United States Supreme Court has held that in the enforcement of certain federal rights matters a reasonable attorney's fee is one that is adequate to attract competent counsel and the aim is to enforce the covered statutes; it is not meant as a form of economic relief to improve the financial lot of attorneys. Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 552 (2010). There is a strong presumption that the reasonable fee is the product of reasonable hours times a reasonable rate, i.e., the "lodestar" figure. State ex rel. Oklahoma Bar Ass'n v. Weeks, 1998 OK 83, ¶26, 969 P.2d 347, 354. In other words, there is a strong presumption that the lodestar method, alone, will reflect a reasonable attorney's fee. Parsons v. Volkswagen of America, Inc., 2014 OK 111, ¶39, 341 P.3d 662. The district court having tried the case is in the best position to evaluate the quality of counsel's representation. Blum v. Stenson, 465 U.S. 886, 899 (1984). Although the quality of representation is generally reflected in the hourly rate, an upward adjustment may be justified "only in the rare case where the fee applicant offers specific evidence to show that the quality of service rendered was superior to that one reasonably should expect in light of the hourly rates charged and that the success was 'exceptional.'" Id. An upward adjustment of the lodestar amount is permissible only in rare and exceptional cases and the fee applicant bears the additional burden of showing the adjustment is necessary. Weeks, 1998 OK 83, ¶27, 969 P.2d at 354. In Arkoma Gas Co. v. Otis Engineering Corp., 1993 OK 27, ¶6, 849 P.2d 392, 394, this Court observed "that we have never, in State ex rel. Burk, supra, or otherwise, rejected the notion that the attorney fee should bear some reasonable relationship to the amount in controversy." ¶13 This Court may, should it vacate the opinion of the Court of Civil Appeals, address any issue properly raised in the appeal or on certiorari. Okla.Sup.Ct.R 1.180(b). III. ANALYSIS A. Category II Punitive Damages. ¶14 The January 27, 2020, Journal Entry of Judgment reflects that Hill sought Category I and II punitive damages on her tort claims. U.S. Bank/Nationstar moved for directed verdict which the trial court granted as to Category II punitive damages. The jury was only instructed on Category I punitive damages. Hill seeks a reversal of the trial court's granting of directed verdict and seeks a re-trial "solely" on the issue as to whether additional (Category II) punitive damages should be imposed on Nationstar. On appeal Nationstar filed a partial motion to dismiss requesting the appellate court dismiss her claim as to Category II punitive damages. Nationstar argues Hill should not be able to pursue her Category II punitive damages proposition on appeal because she accepted the total amount of the trial court's substantive judgment (not the judgment awarding attorney's fees and costs). We agree. ¶15 Following the filing of the petition in error and counter petition in error, Hill accepted payment on the underlying judgment, which included the punitive damages award plus pre- and post-judgment interest. In Hamm v. Hamm, 2015 OK 27, ¶3, 350 P.3d 124, 125, we noted that the "general black-letter rule of law" is "A party to an action who voluntarily accepts from [her] adversary the benefits accruing to [her] under a judgment cannot question the validity of such [j]udgment in this court on appeal, . . ." Id. (citations omitted). Hill notes that Hamm also mentioned the exception to the rule. We held that an exception to the rule is "If the reversal of the judgment appealed from 'cannot possibly affect the appellant's rights to the benefits secured or vested under the part of the judgment which was allowed to become final,' a party has not waived his or her right to appeal by accepting the benefits of the judgment." Id. ¶5, 350 P.3d at 125 (citation omitted). In other words, the exception applies if the judgment-accepting party's appeal may result in a more favorable judgment but has no risk of a less favorable one. Id. We also held that the "no risk exception means no risk, not negligible risk." Id. ¶16 Hill proposes we affirm the jury's award of Category I punitive damages but we reverse the trial court's decision regarding Category II punitive damages. She asks that on remand we direct the trial court to instruct a new jury that the original jury awarded Category I punitive damages and the new jury could choose to award additional Category II punitive damages. She believes the second jury could therefore not be able to reduce the original award of Category I punitive damages; thus, there would be no risk of a less favorable judgment and the exception would apply. We disagree. ¶17 The COCA noted that Hill cited no relevant precedent that would allow such an appellate process and it could find none. "A plea for punitive damages is generally considered to be an element of recovery of the underlying cause of action; it does not constitute a separate cause of action." Rodebush By and Through Rodebush v. Oklahoma Nursing Homes, Ltd., 1993 OK 160 ¶21, 867 P.2d 1241, 1247. "There can only be one 'judgment' or one final judicial determination upon a single cause of action." Oklahoma City Urban Renewal Auth. v. City of Oklahoma City, 2005 OK 2, ¶10 n.16, 110 P.3d 550, 557 n.16 (citation omitted). "Upon entry of a judgment the cause of action is merged into the judgment and the cause of action ceases to exist." Id. (citation omitted). Hill claims this Court applied the exception in Progressive Direct Ins. Co. v. Pope, 2022 OK 4, 507 P.3d 688, wherein a party had accepted payment for property damage but was seeking a more favorable judgment which included treble damages on appeal. Progressive, however, is distinguishable from the present matter. In that case, a consent judgment referenced the parties' settlement agreement which stated the defendant had been paid on her property damage claim. Id. ¶11, 507 P.3d at 692. We noted that the consent judgment specifically reserved the claim for statutory treble damages and the parties construed the property damage claim completely separate from the claim for treble damages. Id. ¶12, 507 P.3d at 693. Here, Hill accepted the payment of punitive damages. She cites no precedent allowing punitive damages to be both affirmed and reversed on appeal. The reversal of punitive damages would subject Hill to the risk of a less favorable judgment. Therefore, we hold that the "no risk" appeal exception does not apply here. We grant Nationstar's partial motion to dismiss that portion of Hill's appeal seeking reversal of the trial court's decision concerning Category II punitive damages. B. Wrongful Foreclosure (malicious prosecution). ¶18 The jury found U.S. Bank liable on Hill's wrongful foreclosure (malicious prosecution) claim. The journal entry of judgment held U.S. Bank to be jointly liable with Nationstar for actual damages and prejudgment interest (a total amount of $230,427.99). U.S. Bank challenged the judgment on appeal and the COCA reversed holding the trial court erred by not granting U.S. Bank's motion for directed verdict on the wrongful foreclosure (malicious prosecution) issue. We agree. ¶19 A wrongful foreclosure action is akin to a malicious prosecution action. See Malcom v. Wells Fargo Bank, N.A., No. CIV-13-0754-HE, 2014 WL 5780712, at *6 (W.D. Okla. Nov. 5, 2014); Young v. First State Bank, Watonga, 1981 OK 53, 628 P.2d 707; Vieser v. Harvey Estes Const. Co., 69 F.R.D. 378, 380 (W.D. Okla. 1975). In an action for malicious prosecution the proponent must prove five elements, one of which is the action has to have been terminated in the proponent's favor. Greenberg v. Wolfberg, 1994 OK 147, ¶14, 890 P.2d 895, 901-02; Glasgow v. Fox, 1988 OK 71, ¶12, 757 P.2d 836, 838 ("It is well established in Oklahoma that one of the elements a malicious-prosecution plaintiff must affirmatively prove is a successful termination in his favor of the original action."). We addressed the issue as to whether a dismissal without prejudice constitutes a termination in favor of the malicious prosecution proponent for the first time in Glasgow. We held "that dismissal without prejudice of the underlying . . . action was not a termination of the suit in appellant's favor which will support an action for malicious prosecution. It did not reach the substantive rights of the cause of action and thereby vindicate appellant as to the underlying action." Id. ¶15, 757 P.2d at 839. We also noted that Oklahoma's policy does not look favorably on malicious prosecution actions. Id. ¶14, 757 P.2d at 839. Later, in Greenberg, we reached the same conclusion: For there to be a prevailing party in an action requires that the underlying proceeding not have been dismissed without prejudice. Dismissal without prejudice is not a termination favorable to the malicious-prosecution plaintiff. Greenberg, 1994 OK 147, ¶20, 890 P.2d at 904.3 ¶20 In the present matter, U.S. Bank dismissed its foreclosure action against Hill without prejudice prior to trial. She was not vindicated on the merits of the action and therefore the dismissal of the foreclosure action without prejudice was not a termination in Hill's favor necessary to support her malicious prosecution claim. Therefore, we reverse the trial court on that portion of the judgment. C. Oklahoma Consumer Protection Act (OCPA) ¶21 Hill alleged Nationstar violated the Oklahoma Consumer Protection Act (15 O.S. 2021, § 751 et seq.) by engaging in unfair trade practices and/or deceptive trade practices.4 The jury found in favor of Hill and the trial court entered judgment against Nationstar for violating the OCPA. Nationstar asserts the trial court erred by denying its motion for directed verdict on this issue. It claims the OCPA exempts Nationstar from the provisions of the act. A motion for directed verdict should be granted "if the party opposing the motion has failed to demonstrate a prima facie case for recovery." Badillo v. Mid Century Ins. Co., 2005 OK 48, ¶24, 121 P.3d 1080, 1092 (quoting Gillham v. Lake Country Raceway, 2001 OK 41, ¶7, 24 P.3d 858, 860). ¶22 Section 761.1 of title 15 of the Oklahoma Statutes provides an aggrieved consumer a private right of action against a person who engages in an unlawful practice under the act (See 15 O.S. Supp. 2023, § 753). However, certain persons are exempt under the act. Section 754 provides: Nothing in the Oklahoma Consumer Protection Act shall apply to: . . . . 2. Actions or transactions regulated under laws administered by the Corporation Commission or any other regulatory body or officer acting under statutory authority of this state or the United States, or to acts done by retailers or other persons acting in good faith on the basis of information or matter supplied by others and without knowledge of the deceptive character of such information or matter; Nationstar argues the § 754 exemption applies because the actions and transactions it was alleged to have engaged in are regulated by the Consumer Financial Protection Bureau (CFPB). We agree. ¶23 The CFPB is a federal agency with the authority to regulate entities like Nationstar. It was created by Congress in 2010 as an independent financial regulator within the Federal Reserve System. Seila L. LLC v. Consumer Fin. Prot. Bureau, 591 U.S. ---, 140 S. Ct. 2183, 2193 (2020). The agency is tasked with implementation and enforcement of a large number of federal consumer protection laws to ensure consumer financial products are fair, transparent, and competitive. Id. Its regulatory authority includes mortgage servicers and rule making relating to unfair or deceptive acts or practices regarding mortgage loans. See 12 U.S.C. §§ 5481(15)(A)(i), 5514, and 5538(a)(1). In addition, Congress granted the CFPB "potent enforcement powers" . . . which include "the authority to conduct investigations . . . initiate administrative adjudications, and prosecute civil actions in federal court." 140 S. Ct. at 2193. "To remedy violations of federal consumer financial law, the CFPB may seek restitution, disgorgement, and injunctive relief, as well as civil penalties." Id. The Court noted, since its inception the CFPB has obtained over $11 billion in relief for over 25 million consumers. Id. ¶24 Hill asserts the OCPA is remedial in nature and "is to be liberally construed to effectuate its underlying purpose." (quoting Patterson v. Beall, 2000 OK 92, ¶28, 19 P.3d 839, 846). She relies upon Robinson v. Sunshine Homes, Inc., 2012 OK CIV APP 87, 291 P.3d 628, to suggest that in order for the exemption to apply it is necessary for there to be an alternative private right of action, i.e., if an agency regulates the actions or transactions at issue, its statutes must also provide that a consumer has the right to a private right of action in order for the alleged offender to be exempt from the OCPA. The Robinson opinion is only persuasive authority and does not provide such requirement. Robinson concerned a mobile home dealer who raised an exemption defense under the OCPA because its business was regulated by the Oklahoma Used Motor Vehicle and Parts Commission which was created in title 47 of the Oklahoma Statutes. The court rejected the defense and found that the Commission's authority was "limited primarily to regulating licensing matters." Id. ¶31, 291 P.3d at 635. It noted there was no indication that the Commission's regulatory activities would be extended to allow an exemption under the OCPA. Id. No provision of title 47 was offered "which provide[d] consumer protections such as a private right of action to consumers." Id. (emphasis added). ¶25 This Court has already determined that the focus on whether a § 754 exemption applies is determined by whether the action or transaction is regulated and not specifically on whether such regulations also provide a private right of action. In Estate of Hicks ex rel. Summers v. Urban East, Inc., 2004 OK 36, 92 P.3d 88, the plaintiff sued a nursing facility alleging the facility solicited false, fraudulent and misleading representations in violation of the OCPA. Id. ¶19, 92 P.3d. at 93. We noted the nursing facility was extensively regulated under the Nursing Home Care Act, 63 O.S. § 1-1900.1 et seq. Although the act did provide penalties and a private right of action, we focused on the regulated actions and transactions in determining the OCPA exemption applied to the defendant: The "action or transaction" in the case at bar involves the services and level of care alleged to have been wrongfully represented to plaintiff's decedent. As such, the action or transaction is regulated under laws administered by the Oklahoma Department of Health, as mandated by the Nursing Home Care Act. This places the action or transaction squarely within the exemption to the Oklahoma Consumer Protection Act found at § 754(2). Id. ¶32, 92 P.3d. at 95. ¶26 Hill would ask this court to liberally construe the § 754 exemption to require, that before an exemption could apply, the offending entity must also be regulated by an agency and such regulations must also include a private right of action. The plain language of the exemption is focused on whether the offending action or transaction is regulated by a state or federal agency and it does not require that a private right of action must also be provided. However, it is not enough that an entity is merely regulated, what is important is that the offending actions or transactions are regulated by such agency. See Sisemore v. Dolgencorp, LLC, 212 F. SupP.3d 1106, 1109 (N.D. Okla. 2016) ("The OCPA safe harbor 'does not apply when a defendant's conduct is governed in some respects by a state or federal agency, but the specific conduct at issue is not within the scope of the agency's authority.'" (citation omitted)); Dinwiddie v. Suzuki Motor of Am., Inc., 111 F. SupP.3d 1202, 1216 (W.D. Okla. 2015) ("Those courts that have addressed this issue have found the statutory exemption to be applicable when the alleged conduct about which the plaintiff has complained is regulated by a government agency.") ¶27 As in Estate of Hicks, the agency, CFPB here, provides extensive consumer protections and enforcement regarding the type of actions and transactions that occurred in the present case. The exemption in § 754 is clearly applicable to Nationstar. Hill could not demonstrate a prima facie case for recovery under the OCPA. Therefore, the portion of the judgment concerning the OCPA claim against Nationstar is reversed. D. Fair Debt Collection Practices Act (FDCPA) ¶28 At trial, Nationstar moved for a directed verdict on Hill's claim that it violated the FDCPA in its collection efforts. The trial court denied the motion and allowed the jury to decide the issue. The jury instructions provided that in order to find a violation of the FDCPA, the jury must determine that Nationstar was a "debt collector" and that Nationstar violated one or more of the requirements of the act in connection with its attempts to collect on Hill's mortgage.5 The jury found Nationstar violated the FDCPA in its collection efforts and awarded Hill statutory damages in the amount of $1000.00. On appeal, Nationstar asserts that it was not a debt collector under the FDCPA because Hill was "contractually current" on her mortgage payments when it took over servicing on July 1, 2012. Therefore, it argues, the trial court erred by not granting its motion for directed verdict. ¶29 The FDCPA excludes "any person collecting or attempting to collect any debt . . . which was not in default at the time it was obtained by such person." 15 U.S.C. § 1692a(a)(6)(F). The United States Court of Appeals, Tenth Circuit, recently noted the Senate Report, related to the 1977 enactment of the FDCPA, found that "the committee does not intend the definition [of debt collector] to cover . . . mortgage service companies and others who service outstanding debts for others, so long as the debts were not in default when taken for servicing." Obduskey v. Wells Fargo, 879 F.3d 1216, 1219 (10th Cir. 2018), aff'd sub nom. Obduskey v. McCarthy & Holthus LLP, 139 S. Ct. 1029 (2019); S. Rep. No. 95-382, at 3-4 (1977). ¶30 The term "default" is not defined in the FDCPA. Courts have considered three approaches in determining whether a loan is in default under the FDCPA. Hoehn v. FCC Finance, LLC, 126 F. SupP.3d 472, 474-75 (D. N.J. 2015). The first approach uses the term default as defined in the original contract; the second uses the dictionary definition of default when a court found it was improper for the definition of default to be solely determined by the creditor; and the third approach looks to whether the defendant, not the plaintiff, classified the debt as in default at the relevant time. Id. Both plaintiff and defendants argue the terms of the subject note support their position. Nationstar asserts Hill was not in default, as defined in the subject note, when it took servicing. Hill asserts she presented evidence of being in default at the time Nationstar began servicing her loan, as defined in the subject note, and therefore the issue was properly submitted to the jury. We agree. ¶31 The September 6, 2002 original note provided: (B) Default If I do not pay the full amount of each monthly payment on the date it is due, I will be in default. Under the note's payment due date section it states: 3. Payments (A) Time and Place of Payments I will pay principal and interest by making a payment every month. I will make my monthly payment on the 1st day of each month beginning on November 01, 2002. Nationstar argues that Aurora's customer account activity statements show that in July 2012, the month that it took servicing, Aurora transferred to Nationstar $1,083.04 on this loan. It asserts the amount was for corporate advances and not mortgage payments therefore Hill's nonpayment of this amount would not have triggered a default and Hill was "contractually current." The activity statement shows the $1,083.04 corporate advance adjustment was dated July 3, 2012, which would have been two days after Hill's monthly payment was due and two days after Nationstar began servicing her loan. Further, the transfer of this amount by Aurora to Nationstar is not dispositive of whether Hill was in default on July 1, 2012. On June 5, 2012, less than a month before Nationstar began servicing the loan, Aurora sent Hill a letter stating: Your mortgage payments of $3,347.72 for the months of May 01, 2012 and June 01, 2012 plus accrued late charges of $36.93 are past due. These past due payments must be received by the end of the month. (emphasis added). Hill asserts in her brief that after the June 5th letter the account activity statement only shows Hill made payments to Aurora totaling $2,317.61. This left Hill $1,030.11 short on her mortgage payments. The June activity statement also only shows a corporate advance adjustment of $9.66. Even assuming the $1,030.11 was a corporate advance adjustment and adding the $9.66 amount would not equal $1,083.04. However, the June 5th letter clearly indicated that $3,347.72 was owed for mortgage payments. The letter clearly delineated other expenses that were not mortgage payments e.g., the $36.93 late charges, and did not mention any amounts for corporate advance adjustments. In addition, Nationstar sent Hill a letter in September 2012 stating that she did not make her July payment or any other mortgage payment thereafter. In ruling on a motion for directed verdict a trial court must consider as true all evidence and all inferences reasonably drawn therefrom that is favorable to the party against whom the motion is made; any conflicting evidence favorable to the movant must be disregarded. Woods v. Fruehauf Trailer Corp., 1988 OK 105, ¶8, 765 P.2d 770, 773. The evidence Hill provided supports the trial court's decision to deny the motion for directed verdict and to submit the issue to the jury. The jury determined Hill was in default at the time Nationstar began servicing her loan and found Nationstar had violated the FDCPA. The trial court entered judgment accordingly. We affirm the trial court's judgment on this issue. E. Double Recovery ¶32 Nationstar argued that to allow Hill to recover punitive damages in addition to attorney's fees under the OCPA and FDCPA, as well as statutory damages under the FDCPA, would amount to an impermissible double recovery.6 In Wagoner v. Bennett, 1991 OK 70, ¶3, 814 P.2d 476, 478, a case concerning a wrongful eviction, this Court held that awarding both punitive damages as well as statutory double damages under the Oklahoma Residential Landlord and Tenant Act "would be prohibited under the general rule which disallows 'double recovery' for a single injury." However, we also held that it would not violate the general rule to award both punitive damages under the plaintiff's cause of action for conversion and additionally the statutory damages under the Oklahoma Residential Landlord and Tenant Act. This is because the action for wrongful conviction and the action for conversion "involve different elements. . . . Two different wrongs are being asserted and each involves different damages." Id. ¶25, 814 P.2d. at 481. ¶33 Here, the punitive damages are based on Hill's tort claims which relate to the "wrong" of failing to honor the agreement related to the deed in lieu of foreclosure and release of mortgage. Following Nationstar's failure and tortious breach of contract, it attempted new collection efforts on the loan. These collection efforts resulted in the FDCPA violations, which represent a separate "wrong" from that which the tort causes of action are based. The FDCPA provides statutory damages which are capped at $1,000.00. 15 U.S.C. § 1692k. The FDCPA also allows a successful plaintiff to recover costs and a reasonable attorney's fee necessary for the plaintiff to vindicate his or her rights under the act. Id.; See St Bernard v. State Collection Service, Inc., 782 F. Supp. 2d 823, 825-26 (D. Ariz. 2010) ("FDCPA plaintiffs 'seek[ ] to vindicate important . . . rights that cannot be valued solely in monetary terms . . . and congress has determined that the public as a whole has an interest in the vindication of statutory rights.'"(citation omitted)). In the present case, the trial court ruled that the recovery of an attorney's fee and punitive damages was not a double recovery because these are not duplicative damages. Under the facts of this case we agree and hold the statutory damages and attorney's fee allowed under the FDCPA and the punitive damages based upon Hill's tort causes of action, are not based upon a single injury and therefore do not amount to an impermissible double recovery. F. Attorney's Fees ¶34 Out of fourteen claims made by Hill only two claims decided by the jury, the OCPA and FDCPA claims, provided a basis for an attorney's fee award and out of those two only one survives, the FDCPA claim. Nationstar asserts that if we find Hill was entitled to an attorney's fee award the amount is unreasonable. We agree. The trial court held that it could not apportion the attorney time spent on the case. It awarded approximately 98% of the time spent on all claims in making an award of $389,040.00 rather than apportioning the amount of time spent on a fee bearing claim. ¶35 An attorney's fee applicant bears the burden of proving that the time and labor for which he seeks compensation are reasonable and that they relate to a claim for which fees are recoverable. Harolds Stores, Inc. v. Dillard Dept. Stores, 82 F.3d 1533, 1553 (10th Cir. 1996); Lee v. Griffith, 1999 OK 32, ¶5, 990 P.2d 232, 233 ("An attorney fee award is recoverable to a prevailing party only for the work attributable to a claim for which such fees are statutorily recoverable."). Oklahoma does not have an "inextricably intertwined" theory upon which attorney's fees do not have to be apportioned if the claims are closely related. Combs v. Shelter Mut. Ins. Co., 551 F.3d 991, 1001-02 (10th Cir. 2008); See also State Bank & Tr. v. First State Bank of Texas, 242 F.3d 390 (10th Cir. 2000) (unpublished) ("Although we are sympathetic to the difficulty of segregating attorneys' fees between claims that are so closely related, we can find no support for an 'inextricably intertwined' exception to the general Oklahoma rule that attorneys' fees can only be awarded where there is an independent statutory basis."). ¶36 The United States Supreme Court has held that in a civil rights matter where attorney's fees are allowed, a reasonable attorney's fee is one that is adequate to attract competent counsel, but that does not produce windfalls to attorneys. Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 552 (2010). The aim of the statute is to enforce the covered civil rights statutes and not to provide a form of "economic relief to improve the financial lot of attorneys." Id. (citation omitted). In the present case, the FDCPA also allows a successful plaintiff to recover a reasonable attorney's fee necessary to vindicate their rights under the act. The trial court's award of attorney's fees based upon almost the entirety of both fee and non-fee bearing claims produced the type of windfall the United States Supreme Court has found to be repugnant. We hold the trial court erred in doing so. We therefore reverse the attorney's fee award and remand for the trial court to determine a reasonable attorney's fee consistent with this opinion. Having determined the attorney's fee award was unreasonable, we affirm the trial court's denial of a fee enhancement. However, upon remand, Hill may reassert the argument as it relates to a fee bearing claim. G. Costs ¶37 Hill, as the prevailing party, was entitled to recover costs. The trial court awarded Hill $12,692.85 in costs. Nationstar contends this amount included $1,676.70 of unauthorized costs. A prevailing party may recover only those litigation expenses covered by statute because the right does not exist at common law. Ashby v. Harris, 1996 OK 70, ¶7, 918 P.2d 744, 747. Section 947 of title 12 of the Oklahoma Statutes provides: A judge of any court of this state may award the following as costs: 1. Any fees assessed by the court clerk or the clerk of the appellate court; 2. Reasonable expenses for the giving of notice, including expenses for service of summons and other judicial process and expenses for publication; 3. Statutory witness fees and reasonable expenses for service of subpoenas; 4. Costs of copying papers necessarily used at trial, limited to the amount authorized by law. If no amount is specified, costs of copying papers shall be limited to ten cents ($0.10) per page; 5. Transcripts of the trial or another proceeding that the court determines are necessary to resolve the case; 6. Reasonable expenses for taking and transcribing deposition testimony, for furnishing copies to the witness and opposing counsel, and for recording deposition testimony on videotape, but not to exceed One Hundred Dollars ($100.00) per two-hour videotape, unless the court determines that a particular deposition was neither reasonable nor necessary; and 7. Any other expenses authorized by law to be collected as costs. Nationstar asserts $216.40 of costs to obtain certain records, $298.30 of costs for travel expenses, $1,139.62 for color copying expenses and $22.38 associated with three-hole punch charges, were unauthorized. Out of the challenged costs, the COCA found that $16.81 of the costs to obtain records were for pharmacy records that were not "used at trial" so it determined only that amount was unauthorized per § 947. The COCA also determined that the statute did not allow for deposition-related travel expenses. Id. ¶9, 918 P.2d at 747 ("[N]o statute authorizes taxing the travel expenses of the appellees' counsel . . . ."). It found that the amount charged for 2538 pages of color copies exceeded the $0.10 statutory amount and therefore reduced the allowed costs to $253.80. In addition, it found no authorization for the three-hole punch charges. In total, the COCA held the trial court erred by awarding $1,223.39 in unauthorized costs. ¶38 Neither party contests the COCA's reduction of the awarded costs on certiorari. Having reviewed the COCA's analysis, we agree that the trial court erred by awarding the $1,223.39 in unauthorized costs and therefore reverse that portion of the costs awarded by the trial court. IV. CONCLUSION ¶39 On the basis of the foregoing, we dismiss that portion of Hill's appeal seeking review of the trial court's Category II punitive damages ruling; reverse Hill's wrongful foreclosure judgment against U.S. Bank; reverse the OCPA portion of the judgment against Nationstar; affirm the FDCPA portion of the judgment against Nationstar, including the $1,000.00 award under the FDCPA; reverse the award of attorney's fees and remand the matter to the trial court to determine a reasonable attorney's fee consistent with this opinion; and reverse $1,223.39 of the costs awarded to Hill. The remainder of the judgment is affirmed. COURT OF CIVIL APPEALS' OPINION VACATED; HILL'S COUNTER PETITION IN ERROR DISMISSED IN PART; JUDGMENT AFFIRMED IN PART AND REVERSED IN PART; CASE REMANDED FOR FURTHER PROCEEDINGS ALL JUSTICES CONCUR FOOTNOTES 1 This matter was assigned to the Oklahoma Court of Civil Appeals on February 3, 2021. On December 6, 2021, Brian G. Sayer and John P. Seidenberger, of the Sawyer Law Group, P.C., entered an appearance for the appellants U.S. Bank National Association and Nationstar Mortgage, LLC. Michael J. McKleroy, Jr., moved to withdraw as counsel which was granted by the Oklahoma Court of Civil Appeals on January 6, 2022. 2 CJ-2013-00210; District Court of Tulsa County, State of Oklahoma. 3 In a recent opinion, Cole v. Bank of America, N.A., 2022 OK 96, 521 P.3d 800, we held that determination on a case-by-case basis is necessary in a malicious prosecution action and in some cases the fact that a party has been dismissed without prejudice should not be an impediment to a malicious prosecution action. The facts in Cole are clearly distinguishable from the present matter before us. Cole had been successful on appeal to vacate a foreclosure judgment against him. Following the appellate decision, the bank filed a motion to dismiss without prejudice as to Cole and pursued its foreclosure action against another party. We determined Cole had been fully vindicated on the merits in the appellate process and the dismissal without prejudice was not based on procedural grounds and therefore it was not an impediment to filing a malicious prosecution action. 4 15 O.S. 2021, § 752 defines deceptive trade practice and unfair trade practice as: 13. "Deceptive trade practice" means a misrepresentation, omission or other practice that has deceived or could reasonably be expected to deceive or mislead a person to the detriment of that person. Such a practice may occur before, during or after a consumer transaction is entered into and may be written or oral; 14. "Unfair trade practice" means any practice which offends established public policy or if the practice is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers; 5 Jury instruction No. 47 informed the jury: Under the FDCPA, a "debt collector" is any person who (a) uses an instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts or (b) regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another. However, an entity is not a "debt collector" if its activity concerns a debt which was not in default at the time it began servicing the debt. If you find that Ms. Hill's mortgage loan was in default at the time Nationstar became the servicer of her mortgage loan on July 1, 2012, you may find Nationstar to be a "debt collector" under the FDCPA. 15 U.S.C. §§ 1692a(6) Jury instruction No. 48 informed the jury: A violation of the FDCPA occurs if a debt collector does any of the following: (a) uses false, deceptive, or misleading representations and/or means in connection with the collection of a debt; (b) falsely represents the character, amount, or legal status of a debt; (c)threatens to take action or takes action which could not be legally taken; or (d) uses unfair and/or unconscionable means to attempt to collect a debt. 15 U.S.C. §§ 1692e and 1692f 6 As far as Nationstar is asserting it would be an impermissible double recovery to allow attorney fees under both the OCPA and FDCPA that is now a moot issue since we do not find the OCPA is applicable to Nationstar in this matter.

6ac7691b-42ca-4b2d-9362-527e084ab605

MTGLQ Investors v. Witherspoon

oklahoma

Oklahoma Supreme Court

MTGLQ INVESTORS v. WITHERSPOON2023 OK 62Case Number: 118355Decided: 06/06/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MTGLQ INVESTORS, L.P., Plaintiff/Appellant,v.JOE H. WITHERSPOON, Defendant/Appellee,andCINDY D. WITHERSPOON and OTHER OCCUPANTS OF THE PREMISES, Defendants. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION III ¶0 Plaintiff/Appellant MTGLQ Investors, L.P. brought a mortgage foreclosure action against Defendant/Appellee Joe H. Witherspoon and Defendant Cindy D. Witherspoon. The trial court found the statute of limitations had expired and granted summary judgment in favor of the Witherspoons. MTGLQ appealed, and Division III of the Court of Civil Appeals affirmed. We granted certiorari and hold that (1) pursuant to 12A O.S.2011, § 3-118(a), the statute of limitations begins to run when the note holder exercises the option to accelerate an installment note, and (2) voluntary dismissal of a foreclosure action decelerates the loan as a matter of law. As a result, the foreclosure action is not barred by the statute of limitations, and the Witherspoons are not entitled to judgment as a matter of law. CERTIORARI PREVIOUSLY GRANTED;ORDER OF THE COURT OF CIVIL APPEALS IS VACATED;JUDGMENT OF THE TRIAL COURT IS REVERSED;CAUSE REMANDED TO THE TRIAL COURT FOR FURTHER PROCEEDINGS. Benjamin G. Kemble, Akerman, LLP, San Antonio, Texas, for Appellant. Joe H. Witherspoon, pro se, Appellee. KANE, C.J.: ¶1 We granted Plaintiff/Appellant MTGLQ Investors, L.P.'s petition for certiorari to address (1) when the statute of limitations begins to run if the note holder exercises the option to accelerate the maturity date of the entire loan balance after the borrower defaults on an installment obligation; and (2) whether the note holder's voluntary dismissal of a foreclosure action decelerates the installment loan as a matter of law. We hold that, pursuant to 12A O.S.2011, § 3-118(a), the statute of limitations begins to run at the time the note holder exercises the option to accelerate, not on the date of default. We further hold that the note holder's voluntary dismissal of a mortgage foreclosure action decelerates or abandons acceleration as a matter of law. FACTS AND PROCEDURAL HISTORY ¶2 In 2004, the Defendant/Appellee Joe H. Witherspoon and Defendant Cindy D. Witherspoon (collectively, the Witherspoons) obtained an installment loan in the amount of $66,400.00 from a mortgage company. The promissory note ("Note") was secured by a mortgage ("Mortgage"). The Mortgage was a standard Fannie Mae/Freddie Mac uniform security instrument containing an optional acceleration clause. ¶3 On July 1, 2014, Bank of New York Mellon (BNYM), as the holder of the Note, filed a petition to foreclose the Mortgage. BNYM alleged that the Witherspoons defaulted on the Note and Mortgage by failing to pay the monthly installment due on December 1, 2010 and that they had failed to make any subsequent payments. BNYM asserted that it had elected to accelerate the debt and declare the entire balance due and payable. On October 13, 2014, BNYM voluntarily dismissed the foreclosure action without prejudice. ¶4 After a series of transfers and assignments, MTGLQ became the holder of the Note and Mortgage on June 4, 2018. On August 21, 2018, MTGLQ sent the Witherspoons a Notice of Intent to Foreclose. The letter informed the Witherspoons that they had defaulted on the Note and Mortgage by failing to pay the monthly installment due on January 1, 2013 and that failure to cure the default by paying all past due payments on or before September 25, 2018 "may result in acceleration of the sums secured by this [Mortgage], foreclosure by judicial proceeding and sale of the Property." Then, on December 7, 2018, MTGLQ filed the present foreclosure action. In the Petition, MTGLQ alleged that the Witherspoons defaulted by failing to pay the installment due on January 1, 2013 and that they had failed to make any subsequent payments. MTGLQ asserted that it had elected to accelerate the debt and declare the entire balance due and payable. ¶5 MTGLQ and the Witherspoons filed motions for summary judgment. The Witherspoons argued BNYM accelerated the loan when they defaulted on December 1, 2010 and that MTGLQ filed its petition to foreclose on December 7, 2018, which was more than six years after BNYM accelerated the debt and, therefore, the claim was barred by the statute of limitations. See 12A O.S.2011, § 3-118. MTGLQ responded that when BNYM dismissed the foreclose action, the note decelerated as a matter of law. The trial court granted summary judgment to the Witherspoons. MTGLQ appealed, and the Court of Civil Appeals affirmed the judgment, holding that the six-year statute of limitations began to run on the date of default and that dismissal did not decelerate the note. We granted MTGLQ's petition for certiorari. STANDARD OF REVIEW ¶6 Summary judgment is reviewed de novo. Rickard v. Coulimore, 2022 OK 9, ¶ 4, 505 P.3d 920, 922. Summary judgment is appropriate only when there is no genuine controversy as to any material fact, and the moving party is entitled to judgment as a matter of law. Id. In this case, the material facts are not in dispute. Therefore, only questions of law are involved. Appellate courts have plenary, independent and nondeferential authority to determine whether the trial court erred in its legal rulings. See Fanning v. Brown, 2004 OK 7, ¶ 8, 85 P.3d 841, 845. ANALYSIS The Accelerated Due Date ¶7 We will first review the trial court and Court of Civil Appeals's determination that the note holder accelerated the installment note and the statute of limitations began to run on December 1, 2010. ¶8 Generally, on an installment note, the statute of limitations begins to run against each installment on the day following its maturity. See Okla. Brick Corp. v. McCall, 1972 OK 70, ¶ 11, 497 P.2d 215, 217. A separate claim accrues as to each missed installment payment. Id. ¶ 10, at 217. An optional acceleration clause gives the mortgagee the option, in the event of the mortgagor's default on an installment note, to accelerate the maturity date of the note, making the entire loan balance due immediately. The law is well-settled that when an installment note and mortgage contain an optional acceleration clause, the statute of limitations begins to run on the date the mortgagee exercises the option to accelerate. See Union Central Life Ins. Co. v. Adams, 1934 OK 693, ¶¶ 7-11, 38 P.2d 26, 27-28. That is because when an installment note is accelerated, a claim accrues as to the entire balance of the note. Acceleration triggers the statute of limitations. ¶9 This has been codified in the applicable statute of limitations: [A]n action to enforce the obligation of a party to pay a note payable at a definite time must be commenced within six (6) years after the due date or dates stated in the note or, if a due date is accelerated, within six (6) years after the accelerated due date. 12A O.S., § 3-118(a) (emphasis added). Acceleration makes the entire balance due immediately. Therefore, the date the mortgagee exercises its option to accelerate is, by definition, the "accelerated due date," for purposes of 12A O.S., § 3-118(a). The six-year statute of limitations begins to run when the mortgagee accelerates the installment note, not the date the mortgagor defaults on an installment payment. ¶10 BNYM, in the first petition to foreclose, alleged that the Witherspoons went into default when they missed the December 1, 2010 installment payment. The Note and Mortgage contained optional acceleration clauses.1 The undisputed evidence shows BNYM first exercised the option to accelerate on July 1, 2014, when it filed the Petition to Foreclose Mortgage.2 BNYM alleged that the Witherspoons were in default and that it was declaring the entire loan balance due and payable. The Witherspoons did not put forth any evidence to support their assertion that BNYM accelerated the note on December 1, 2010--the same day they allegedly missed an installment payment and went into default.3 ¶11 We hold that BNYM exercised its option to accelerate the installment note on July 1, 2014, and, according to 12A O.S., § 3-118(a), that was when the six-year statute of limitations began to run. The trial court and the Court of Civil Appeals erred by finding the note was accelerated and the statute of limitations began to run on December 1, 2010. Deceleration4 ¶12 We now turn to whether BNYM's voluntary dismissal of the first foreclosure action on October 13, 2014 decelerated the note as a matter of law. This is an issue of first impression in Oklahoma. ¶13 The Court of Civil Appeals relied solely on PNC Bank, N.A. v. Unknown Successor Trs., 2020 OK CIV APP 60, 479 P.3d 238, in holding that BNYM's voluntary dismissal of the first foreclosure action did not decelerate the installment loan or toll the running of the statute of limitations. In PNC Bank, the Court of Civil Appeals established its own criteria for the deceleration of an installment loan: (1) there must be a contractual provision authorizing deceleration; (2) the creditor must take affirmative action evidencing intent to decelerate; and (3) the lender must give the borrower notice of deceleration by means reasonably calculated to inform the debtor of the deceleration and that the debtor's installment obligation is reinstated. See id. ¶¶ 24-56, 479 P.3d at 244-50. The PNC Bank court held that "[t]he mere act of voluntary dismissal without more" did not satisfy its criteria. Id. ¶ 59, at 250. ¶14 Opinions published by the Court of Civil Appeals are merely persuasive and are not accorded precedential value. See Skinner v. John Deere Ins. Co., 2000 OK 18, ¶ 19, 998 P.2d 1219, 1223-24; Okla.Sup.Ct.R. 1.200(d)(2), 12 O.S.2023, ch. 15, app. 1 (as amended by In re Amend. Okla.Sup.Ct.R. 1.200, 2023 OK 21 (eff. March 6, 2023)). We are not persuaded by the Court of Civil Appeals's decision in PNC Bank.5 ¶15 First, a deceleration clause in the note or security instrument is not required to decelerate. The Note and Mortgage do not contain deceleration provisions. MTGLQ asserts that no other jurisdiction requires an express deceleration clause in the note or security instrument. We also recognize that a deceleration clause is not in the standard Fannie Mae/Freddie Mac security instrument. The Note and Mortgage do, however, contain optional acceleration clauses, provisions authorizing the lender to waive its rights under the contract, and non-waiver provisions. Specifically, the Note and Mortgage provide that the lender's waiver of its right to exercise the option to accelerate does not prevent the lender from later exercising the option to accelerate. Deceleration is, effectively, the revocation of the previously exercised option to accelerate and waiver of such right. ¶16 We agree, generally, with PNC Bank's point that an affirmative act indicating intent to decelerate is required. It has long been the law in Oklahoma that acceleration requires an affirmative act indicating clear and unequivocal intent to accelerate an installment note. See Union Central, 1934 OK 693, ¶¶ 11-12, 16, 38 P.2d 26, 28-29. It follows that the same is required for deceleration. Requiring an affirmative act indicating clear and unequivocal intent to decelerate is also consistent with the general contract principle of abandonment. Rights acquired under a contract may be abandoned or relinquished by conduct clearly indicating such purpose. See Lewter v. Holder, 1960 OK 6, ¶ 21, 348 P.2d 845, 848. Acceleration is a right acquired under the contract. The right to accelerate the loan may be abandoned by an affirmative act clearly indicating intent to abandon the right of acceleration. ¶17 We disagree with the PNC Bank court's conclusion that voluntarily dismissing the foreclosure action, by itself, does not constitute an affirmative act clearly indicating intent to decelerate or abandon acceleration. Just as the act of filing a petition to foreclose is an affirmative act indicating intent to accelerate the note, the act of dismissing the petition to foreclose is an affirmative act demonstrating the lender's intent to decelerate or abandon acceleration. See Freedom Mortg. Corp. v. Engel, 169 N.E.3d 912, 926 (N.Y. 2021) ("[W]here acceleration occurred by virtue of the filing of a complaint in a foreclosure action, the noteholder's voluntary discontinuance of that action constitutes an affirmative act of revocation of that acceleration as a matter of law, absent an express, contemporaneous statement to the contrary by the noteholder."). We hold that BNYM's voluntary dismissal of the foreclosure petition, the filing of which had accelerated the loan, clearly indicated it was decelerating or abandoning its right to accelerate. ¶18 There are several advantages to the bright-line rule that a voluntary dismissal, absent the lender's contemporaneous statement to the contrary, results in revocation or abandonment of acceleration. First, to hold otherwise would disincentivize dismissal. Our holding benefits both lender and borrower. As the New York Court of Appeals observed: A clear rule that a voluntary discontinuance evinces revocation of acceleration (absent a noteholder's contemporaneous statement to the contrary) makes it possible for attorneys to counsel their clients accordingly, allowing borrowers to take advantage of the opportunity afforded by the de-acceleration--reinstatement of the right to pay arrears and make installment payments, eliminating the obligation to immediately pay the entire outstanding principal amount in order to avoid losing their homes. A return to the installment plan also makes it more likely that borrowers can benefit from the various public and private programs that exist to help borrowers work out of a default. Id. at 926-97. Adopting the bright-line rule that the voluntary dismissal of an action to foreclose a mortgage, by itself, decelerates the note as a matter of law, provides certainty and eliminates the need to scrutinize post-dismissal conduct to determine if the lender intended to decelerate the note or abandon acceleration.6 This rule promotes the consistent application of the statute of limitations. ¶19 Additional notice of deceleration, as indicated by PNC Bank, is not necessary. Notice of the dismissal is notice of deceleration. The lender's commencement of a mortgage foreclosure action is sufficient to put the borrower on notice that the loan has been accelerated. It corresponds that the lender's voluntary dismissal is sufficient to put the borrower on notice that acceleration has been abandoned. As long as the borrower receives proper notice of the dismissal, no additional notice of deceleration is required. It is undisputed that the Witherspoons received notice of BNYM's voluntary dismissal without prejudice. ¶20 With respect to PNC Bank's requirement that the lender give the borrower notice that the installment obligation has been reinstated, we find that this is satisfied by the dismissal itself. Dismissal of the foreclosure action reinstates the parties' pre-acceleration rights and obligations as a matter of law. Additional notice of reinstatement of the installment obligation is not required. Revocation or abandonment of acceleration discontinues the obligation to make a single lump sum payment for the entire loan balance and reinstates the borrower's obligation to make installment payments on the note. Voluntary dismissal also reinstates the lender's right to exercise the option to accelerate and foreclose based on the borrower's default. ¶21 We hold that the district court and the Court of Civil Appeals erred by concluding that BNYM's voluntary dismissal of the first foreclosure action did not decelerate the loan. The Court of Civil Appeals's opinion is vacated, and the trial court's order granting summary judgment to the Witherspoons based on the statute of limitations defense is reversed. The cause is remanded to the trial court for further proceedings. ¶22 PNC Bank's analysis and determination that the voluntary dismissal of a foreclosure action, by itself, does not decelerate the loan as a matter of law is expressly overruled. See PNC Bank, 2020 OK CIV APP 60, ¶¶ 34-52, 54-56, 59, 479 P.3d at 246-50. PNC Bank's analysis and determination that the statute of limitations begins to run when the lender exercises the option to accelerate the note--not the date of default--is correct and left undisturbed by today's Opinion. Id., ¶¶ 25-31, 53, 479 P.3d at 244-46, 249. CONCLUSION ¶23 BNYM exercised its option to accelerate the installment note when it filed a petition to foreclose the mortgage on July 1, 2014. BNYM decelerated the note when it voluntarily dismissed the foreclosure action on October 13, 2014. MTGLQ then exercised its option to accelerate the installment note when it filed a petition to foreclose the mortgage on December 7, 2018. The petition was timely filed.7 The foreclosure action is not barred by the six-year statute of limitations, and the Witherspoons are not entitled to judgment as a matter of law. CERTIORARI PREVIOUSLY GRANTED;ORDER OF THE COURT OF CIVIL APPEALS IS VACATED;JUDGMENT OF THE TRIAL COURT IS REVERSED;CAUSE REMANDED TO THE TRIAL COURT FOR FURTHER PROCEEDINGS. CONCUR: Kane, C.J., Rowe, V.C.J., Kauger, Winchester, Gurich, Combs, Darby, and Kuehn, JJ. NOT PARTICIPATING: Edmondson, J. FOOTNOTES 1 The Note provides, in pertinent part: (C) Notice of DefaultIf I am in default, the Note Holder may send me a written notice telling me that if I do not pay the overdue amount by a certain date, the Note Holder may require me to pay immediately the full amount of Principal which has not been paid and all the interest that I owe on that amount. That date must be at least 30 days after the date on which the notice is mailed to me or delivered by other means. (D) No Waiver by Note HolderEven if, at a time when I am in default, the Note Holder does not require me to pay immediately in full as described above, the Note Holder will still have the right to do so if I am in default at a later time. The acceleration clause in paragraph 22 of the Mortgage provides: Lender shall give notice to Borrower as required by Applicable Law prior to acceleration following Borrower's breach of any covenant or agreement in this Security Instrument . . . . The notice shall specify: (a) the default; (b) the action required to cure the default; (c) a date, not less than 35 days from the date the notice is given to Borrower, by which the default must be cured; (d) that failure to cure the default on or before the date specified in the notice may result in acceleration of the sums secured by this Security Instrument and sale of the Property; and (e) any other information required by Applicable Law. The notice shall further inform Borrower of the right to reinstate after acceleration and the right to bring a court action to assert the non-existence of a default or any other defense of Borrower to acceleration and sale. If the default is not cured on or before the date specified in the notice, Lender at its option may require immediate payment in full of all sums secured by this Security Instrument without further demand and may invoke the power of sale and any other remedies permitted by Applicable Law. . . . 2 It is common for the mortgagee to exercise the option to accelerate by commencing a mortgage foreclosure action and not by some other prior, affirmative act of acceleration. BNYM's Petition to Foreclose Mortgage stated that "Plaintiff, as holder of said note, has elected to declare the entire balance due and payable" and "that the whole amount of the indebtedness thereby secured has matured and is now due and payable . . . ." BNYM also alleged that "Plaintiff has demanded the payment of the same but the Defendant failed, refused and neglected to pay such amounts due." However, there is no evidence in the record that BNYM accelerated the note or gave the Witherspoons notice of acceleration demanding full payment of the entire balance prior to commencing the foreclosure action. 3 Under the terms of the Note and Mortgage, default does not automatically accelerate the loan. Hence, it is an optional acceleration clause. Additionally, applicable law and/or the Note and Mortgage require that the lender give the borrower notice of default and 35 days to cure the default by bringing the loan current or agreeing to a modification agreement or a repayment plan prior to exercising the right to accelerate. See supra note 1; 24 C.F.R. § 201.50. 4 Deceleration is also referred to as deacceleration, de-acceleration, revocation of the right to accelerate, and abandonment of acceleration. 5 Neither party sought certiorari review in PNC Bank, N.A. v. Unknown Successor Trs., 2020 OK CIV APP 60, 479 P.3d 238. 6 Other evidence of abandonment of acceleration, such as whether the lender resumed sending monthly installment statements to the borrower after the dismissal and whether the August 21, 2018 Letter of Intent to Foreclose evidenced prior deceleration becomes immaterial. Today's holding does not, however, dispense with the loan servicer's duty to provide periodic statements for residential mortgage loans as required by law or contract. 7 Even if the loan had not been decelerated, MTGLQ's petition, filed on December 7, 2018, was timely filed. As discussed above, initially, the statute of limitations began to run when BNYM exercised its option to accelerate by filing the first petition to foreclose the mortgage on July 1, 2014. The statute of limitations would not have expired until six years later on July 14, 2020.

bf38a0b2-6a11-41fc-bbaf-fc1761b8d84d

TOCH, LLC v. City of Tulsa, et al.

oklahoma

Oklahoma Supreme Court

TOCH v. CITY OF TULSA2023 OK 69Case Number: 119662Decided: 06/13/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TOCH, LLC, an Oklahoma limited liability Company, Plaintiff/Appellant, v. CITY OF TULSA, an incorporated municipality, Defendant/Appellee, and TULSA HOTEL PARTNERS, LLC, an Oklahoma limited liability company, Intervenor/Appellee. ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY ¶0 TOCH, LLC, the owner and operator of Aloft Hotel alleged that the Tulsa Tourism Improvement District No. 1 was allegedly improperly created because fifty percent or more of the affected hotel owners protested in writing prior to its creation. City of Tulsa and Tulsa Hotel Partners sought summary judgment on this issue and disputed this material fact by submitting affidavits to disprove TOCH's allegation. The trial court erred when it made a factual determination on this controverted fact and granted summary judgment to City and Intervenor on this issue. Weighing disputed evidence is not proper on summary judgment. The trial court's decision is reversed. We previously issued an order to retain this appeal. DECISION OF TRIAL COURT REVERSED AND REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Lee I. Levinson and Evan M. McLemore; Levinson, Smith & Huffman, P.C., Tulsa, Oklahoma, for Plaintiff/Appellant, TOCH, LLC. R. Lawson Vaughn, Asst. City Attorney, Tulsa, Oklahoma, for Defendant/Appellee, City of Tulsa. Jared M. Burden; Frederic Dorwart, Lawyers PLLC, Tulsa, Oklahoma for Intervenor/Appellee, Tulsa Hotel Partners, LLC. Edmondson, J. ¶1 We decide two issues in this appeal, (1) whether a trial court may decide a disputed material fact on summary judgment, and (2) whether TOCH waived the right to assert constitutional arguments in this current appeal following the findings of the prior appeal in this litigation, TOCH, LLC v. City of Tulsa (TOCH I), 2020 OK 81, 474 P.3d 859, as corrected (Sept. 30, 2020) (TOCH I). We answer both questions in the negative: (1) it is outside the scope of the trial court to weigh evidence on summary judgment on material disputed facts; and (2) TOCH has not waived the right to assert the constitutional claims raised in its Petition and on summary judgment. FACTUAL AND PROCEDURAL BACKGROUND ¶2 TOCH, LLC, an Oklahoma limited liability company filed this action against the City of Tulsa, an incorporated municipality, asking the court to declare the proposal creating the Tourism Improvement District (TID) invalid. Intervenor is the owner of a hotel in the proposed assessment district which is in favor of the TID and joined the City in disputing that TOCH is entitled to the requested relief. TOCH asserted numerous reasons why this TID was improperly created, one of which is whether the City's act of approving the TID violated 11 O.S.2011 § 39-108 (D).1 TOCH alleged that it did when City approved the Resolution to create the TID as more than fifty percent (50%) of the hotels within this proposed district objected to its creation. Through written affidavits, City and Intervenor advanced an alternate conclusion that less than fifty percent (50%) of the hotels objected, rendering this a disputed material fact. Although both parties have vigorously briefed various constitutional arguments raised by TOCH, these issues only become viable and at issue once it is determined if the TID was properly created. The resolution of this pivotal question hinges on disputed facts and cannot be determined by a trial court on summary judgment. We will not decide at this point any of the constitutional issues briefed by the parties or decided by the trial court. ¶3 Following the issuance of the mandate in TOCH I, all parties filed their respective motions for summary judgment which are now before us. City and Intervenor sought summary judgment on the issue that fifty percent (50%) of the property owners within the district did not object to the TID and various constitutional arguments. TOCH only sought summary judgment with respect to its constitutional claims responding that there were questions of fact surrounding whether fifty percent (50%) or more of the hotels had objected to the creation of the TID as contemplated by 11 O.S.2011 § 39-108(D). We agree. This is the second time this matter has come to this Court from a summary judgment decision. ¶4 In October 2016, the City posted a Resolution announcing its plans to create Tourism Improvement District No.1 for the sole purpose of providing marketing services for private or public events reasonably calculated to increase occupancy and room rates for hotels and motels with 110 or more rooms. Thirty-three hotels met this room occupancy criteria as reflected on the City's Assessment Roll. If approved, each hotel would be subject to an assessment of three percent (3%) of the gross proceeds or gross receipts derived from the rent derived from an occupancy of a hotel or motel room.2 This new assessment was to be determined in the same manner as the hotel tax imposed by City.3 Although the obligation to pay money in this TID is labeled as an "assessment" the formula for determining the assessment amount is identical to the hotel tax. TOCH has urged that the proposed assessment outlined in the TID is actually an unconstitutional imposition of a tax. Under this ordinance creating the hotel tax, the operator and any office of the corporate operator of the hotel would be personally liable for collecting and paying this new assessment, not the property owner.4 Although the TID proposed plan indicates the assessment is to be against the property owner, there is also language suggesting that it is determined in the same manner as the hotel tax, which renders the Operator and not the Owner liable. The record before us is unclear on this issue. The City created three distinct categories with respect to each hotel property on its Assessment Roll: (1) Hotel name; (2) Owner/Operator; and (3) Owner of Property. The Affidavit of Mailing filed by the Deputy City Clerk reflects that the Notices of Hearing were only sent to the Owner of Property, and not to the Operator.5 Thus, for those hotels whose operators are not the property owner, the City did not provide them notice of the hearing. Consequently, if the operator is personally liable for this assessment, they were not mailed a Notice of Hearing.6 ¶5 Prior to this Resolution, the City had previously attempted to gain enough approval for a TID three other times, all with lower hotel room count numbers. The previous attempts all failed, as more than fifty percent of the hotels in the proposed district objected to its creation. Summary Judgment Motions Preceding TOCH I ¶6 TOCH argued it was entitled to summary judgment because more than 50% of the hotels objected to the creation of the TID prior to the time the TID was created. TOCH urged that the legislature prohibited the creation of any improvement district where the "owners of fifty percent (50%) or more in area of the tracts or parcels within the district or a majority of the owners of record of property in the assessment area protest," in 39-108 (D). It is undisputed that prior to the public hearing, legal counsel for TOCH submitted two letters dated November 5 and November 8, 2018 (Objection Letters) to the City advising that he had been hired by multiple hotel owners to file an official objection to any creation of a TID.7 The Objection Letters specify that "the parties joining in this objection are the owners and operators of the hotels listed as follows," identifying twenty different hotels within the district. It is further undisputed that counsel for TOCH appeared at the public hearing, provided a copy of the Objection Letters to the City Council, and made a verbal objection on behalf of each of the twenty hotels.8 It is undisputed these letters were: (1) received by the City Clerk prior to the Public Hearing; and (2) provided to the City Council at the Public Hearing. 9 This ratio of 20/33 represents 60% of the affected hotels. Even with these objections, the City voted unanimously to adopt the Resolution creating the TID at the Hearing on November 7. Although this Resolution was signed by the Vice Chair at the Hearing, the Tulsa Mayor did not approve this resolution for another 28 days, on December 5, 2018. The parties do not agree when the TID was officially formed; this point is relevant as to additional individual Notices of objections that were separately filed by the same hotels listed in the Objection Letters. It is undisputed that these Notices were filed after the hearing but before the Mayor signed the Resolution adopting the TID. TOCH claims, since these Notices were filed prior to the time the Mayor signed off on the TID, they should be considered as being filed prior to its creation. City and Intervenor argue that any Notice filed after the November 7 hearing should be considered late and an invalid objection. ¶7 City and Intervenor disputed that 50% of the hotels had objected to the creation of the TID and presented conflicting evidence. City argued because there were genuine issues of material fact TOCH was not entitled to summary judgment on this issue.10 Later, City changed its position and urged summary judgment was appropriate. Intervenor and City admitted that the Objection Letters were filed with the City Clerk prior to the Public Hearing, but denied: (1) that letters were authorized to be filed by each of the listed hotels; (2) that the named hotels constituted a majority of the record owners in the proposed TID; and (3) that the letters constituted a written protest within the meaning of 11 O.S.2011 § 39-108(D). Intervenor admitted that "subsequent to the City Council meeting, written objections to the creation of the TID were provided to the City .... by the owners or operators of 20 of the 33 hotels to be subject to the assessment."11 However, they argued that these Notices of Objection were not sufficient. Intervenor and City produced four affidavits and one declaration, signed more than eight months after the hearing, in an attempt to establish that at least six of the hotels "were included in the [Objection] Letters without their permission and without agreeing to be represented by TOCH or its attorney.12 At least one affidavit submitted by Intervenor and City is signed by a "liaison" for an alleged owner, although the entity cited in the affidavit is not the party identified as the "Owner of Property" or the "Owner/Operator" on the City's Assessment Roll. There is also a suggestion that a "manager" for one of the hotels did not support the creation of the TID, but that this manager lacked authority to bind the hotel entity. None of these individuals who allegedly signed the disputing documents testified at a hearing before the trial court or by deposition. Based solely on these exhibits, City and Intervenor disputed that TOCH's Objection Letters constituted valid objections from 20 hotels. They argued that at most 14 out of 33 hotels objected, which is less than the majority required by Section 39-108(D) to prevent the creation of the TID. City and Intervenor urged they were entitled to summary judgment on this issue. ¶8 The trial court declined to rule on summary judgment on this subject finding "there is a substantial controversy of material fact regarding whether a sufficient number of hotels subject to the TID objected to its creation at the time of the Public Hearing." 13 The trial court noted that TOCH has evidence that its counsel of record represented 20 hotels at the Public Hearing that were subject to the TID and objected to its creation."14 The trial court discussed the Intervenor and City's conflicting affidavit evidence that three of the hotels allegedly represented by TOCH's counsel may not have authorized their agents to object at the hearing.15 The trial court also ruled in its prior Order on TOCH's request for temporary injunction, that 17 of the 33 hotels, more than 50% of the hotels objected to the creation of the TID at the time of the Public Hearing. The trial court determined these disputed material facts made this issue improper for summary adjudication. We agree. The trial court did grant summary judgment in favor of TOCH but on a different legal issue from that which we addressed in TOCH I. Summary Judgment Motions After Mandate of TOCH I ¶ 9 Less than a month after mandate issued in TOCH I, City and Intervenor sought summary adjudication as to TOCH's claim that 50% of the affected property owners objected to the creation of the TID. Their argument and supporting evidence were essentially unchanged from their previous unsuccessful summary judgment attempt. City and Intervenor offered affidavit statements and one declaration16 to prove that 6 of the 20 hotels did not object to the TID and discredit TOCH's evidence that a majority of hotels had objected. TOCH responded that it had not asked for summary judgment on this issue, as material facts were disputed making resolution on this point unfit for a summary decision. We agree. This apparent challenge is belied by the gross discrepancies within these affidavits and declaration. It is impossible to discern what relevance any of these proffered documents have to this matter, other than to illuminate the overwhelming presence of material disputed facts. ¶10 City and Intervenor also argued that TOCH's objection letters did not constitute a recognized form of objection, because only the "owner of property" or "owners of record of property", not the hotel operator, have the statutory authority to object or proceed with an action to set aside a TID, and any such objection would have to be signed by the owner. 11 O.S.2011, § 39-108. We disagree that Section 39-108 dictates this result. Their argument highlights the precarious constitutional problem City created with its Resolution, rendering the hotel operator personally liable for this new "assessment" while the Legislature only authorized the assessment to be made and notice of the proceeding to be against the "owner of property." The legal implication of the City's action will be discussed later. ¶11 The trial judge directed the parties to file Findings of Fact and Conclusions of Law at the hearing. TOCH again urged that the trial court lacked jurisdiction to rule on a material disputed fact and further urged that the TID should be invalidated because of many constitutional errors including that the City denied the hotel operators due process and the meaningful opportunity to be heard when it failed to provide notice of the TID hearing to operators who were not property owners. City and Intervenor urged that the trial court should not consider any objection submitted by a party other than a "property owner" and urged the trial court to consider all of the disputing affidavits and declaration it submitted as more true than the TOCH Objection Letters and other Notices submitted by hotel operators. They also urged that because the Legislature has authorized the municipal bodies to create a Tourism Improvement District, that it is de facto constitutional. ¶12 The trial court granted summary judgment in favor of City and Intervenor and denied relief to TOCH. Although the court engaged in an extensive six page analysis in its Order, the portions relevant to our decision include the following: (1) the Objection Letters were not protests in writing sufficient to defeat the creation of the TID because (a) they were not signed by the property owners; (b) there is no proof that the listed hotels authorized TOCH'S counsel to object to the TID; (c) six out of the twenty property owners listed in the Objection Letters averred by affidavit that they did not hire or authorize anyone to object to the TID at or prior to the hearing; and (d) the Objection Letters at most represent 42% of the property owners as objecting to the TID prior to its creation; (2) the "Notices to the Public" which were filed after the November 7 hearing were not valid objections because: (a) the TID was considered as created on the day of the Hearing at the time of the City Council vote, and not on December 5 when the Mayor signed the Resolution; (b) even if it was determined the Notices were timely filed, at least one was not signed by the property owner, "as proved by affidavit," and three other Notices were discounted for other reasons with the trial court concluding at most only 42% of the owners objected, which is less than the needed majority.17 ¶13 TOCH filed its Petition in Error on June 24, 2021. Upon Order of this Court, TOCH filed a Supplemental Petition in Error on September 10, 2021 listing forty-three different points of error. TOCH alleged it was error for the trial court on summary judgment to render a decision on an issue where there were disputed material facts, whether a majority of the hotel property owners objected to the creation of the TID. The remaining errors raised included whether TOCH had waived the right to raise any constitutional argument as a result of TOCH I, and asserting the TID should be invalidated because the legislation authorizing the TID is a Special Law, denial of due process, unconstitutional assessment of tax, and other constitutional errors. ¶14 City and Intervenor responded that TOCH abandoned any future ability to raise constitutional claims because of their arguments made on the prior appeal in TOCH I, an appeal initiated by City and Intervenor. They then asserted that this Court upheld the TID in TOCH I, "reversing and remanding this case for proceedings on the question whether a majority of property owners had timely and properly objected to the creation of the District." City and Intervenor's statement in no way is supported by our conclusion in TOCH I wherein we answered the only question before us, whether the City exceeded its authority when creating a TID for hotels with 110 rooms or more. We concluded: Title 11, section 39-103.1(A) provides municipalities the authority and discretion to create hotel advertising tourism improvement districts for any size hotel the municipality deems appropriate, so long as they have at least 50 rooms. City did not exceed the authority granted to it when it chose to limit the TID to hotels with 110 or more rooms. The district court erred in granting summary judgment to Toch. The district court's order is reversed and the cause is remanded for further proceedings. TOCH I, 2020 OK 81, ¶ 32, 474 P.3d at 868. We did not direct this matter return to the district court to decide the factual issue of how many hotels objected to the creation of the TID. City and Intervenor also asserted that the district court agreed with this Court that the TID was "constitutional" because of our decision in TOCH I. We made no decisions in TOCH I regarding any of the constitutional claims, only whether the City's actions in creating the TID were authorized by the statute. ¶15 Following the filing of the Petition in Error, TOCH asked that we retain this appeal. We granted the motion to retain. STANDARD OF REVIEW ¶16 Summary judgments are disfavored and will be affirmed only if the appellate court determines there is no dispute as to any material fact and that the party is entitled to judgment as a matter of law. TOCH I, 2020 OK 81, ¶ 15, 474 P.3d at 865.18 Summary judgments are reviewed under a de novo appellate standard. Id. LEGAL ANALYSIS ¶17 We first examine the trial court's finding of fact that no more than forty-two percent (42%) of the property owners within the TID objected prior to its creation. If a litigant is successful in a summary judgment proceeding, the parties are denied the right to a full trial on the merits. It is for this reason, that the province of the jury cannot be invaded, where there are material facts in dispute, it is contrary to proper summary judgment process for any court to decide disputed material fact questions. Cranford v. Bartlett 2001 OK 47, ¶¶ 2-3, 25 P.3d 918, 920. This factual dispute must be resolved from the outset. The Legislature was clear that "if the owners of fifty percent (50%) or more in area of the tracts or parcels within the district or a majority of owners of record of property in the assessment area protest, in writing, the creation of the district, the district shall not be created." 11 O.S.2011 §39-108(D). If it is determined following trial on this issue, that fifty percent or more of the hotels objected prior to the creation of the TID, then the statute is clear, "the district shall not be created." ¶18 It is undisputed that a letter was filed on behalf of TOCH and other owners and operators of twenty-two (22) different hotels and this letter was delivered to the City prior to the hearing on the creation of the TID. We previously recognized in TOCH I that although TOCH did not appear and object at the hearing, the letter filed by the attorney on its behalf as its agent constituted a valid objection sufficient to meet the statutory prerequisite to bring this action. TOCH I, supra., 2020 OK 81, ¶ 18, 474 P.3d at 865. We noted that "[a]n agency relationship generally exists if two parties agree one is to act for the other." Id. (citations omitted). Based on the representations set out in the Objection Letters, not only was the attorney acting as agent for TOCH, but also for the owners and operators of the twenty-two hotels. We previously recognized the statements by legal counsel in this letter as creating a valid agency relationship and as a valid objection on behalf of TOCH. ¶19 City and Intervenor have disputed this agency relationship as to six of these hotels by submitting affidavits to disprove TOCH's allegations. It is improper and reversible error for a trial court to weigh the evidence on a motion for summary judgment. Andrew v. Depani-Sparkes, 2017 OK 42, ¶ 33, 396 P.3d 210, 222; See also, Stuckey v. Young Exploration Co., 1978 OK 128, ¶ 15, 586 P.2d 726, 730. City and Intervenor provided four affidavits on behalf of five hotels, and one declaration on behalf of one hotel to deny they ever objected to the creation of the TID, assert the person who did object did not have the authority to object, or deny they ever authorized being included as "objecting" in the Objection Letters. They urged that six of the twenty-two hotels did not actually object, and asked that the trial court take this affidavit evidence as more believable. When dealing with disputed facts we have recognized that "it is not the purpose of summary judgment to substitute a trial by affidavit for a trial according to law. Weighing of the evidence must be left to the jury." Stuckey, supra., 1978 OK 128, ¶ 5, 586 P.2d at 730. ¶20 With respect to the trial court's Order that the "Notices to the Public" were not protests in writing sufficient to defeat the creation of the TID because they were "prepared, signed, and delivered after the Tourism District was created on November 7, 2018," we find there is insufficient evidence in the record to support this conclusion. The evidence reflects that the Mayor did not sign the Resolution until almost one month after the hearing. Both City and Intervenor have urged that some of the hotels may have objected earlier, but before the Mayor signed off they changed their mind. City and Intervenor have also urged that decisions made post November 7, 2018 hearing should be considered. There is insufficient evidence in the record to conclude what if any requirements from the City Municipal Code pertain to when a Resolution becomes effective. ¶21 Next we turn to the argument raised by City and Intervenor and the decision by the trial court that "TOCH may not re-litigate its arguments subject to a prior appeal." In TOCH I, the trial court granted TOCH's motion for summary judgment but only on the argument that the TID was improperly created because the City did not use the 50-room threshold outlined in Section 39-103.1 of the Act. City and Intervenor filed an appeal and prevailed on this one issue. TOCH did not file an appeal contesting the trial court's denial of summary judgment on all of the constitutional grounds. We decided the sole issue of whether the City exceeded its authority granted in title 11, section 39-103.1 by limiting the TID to hotels or motels with 110 or more rooms. There were no other legal or constitutional arguments before us on appeal in TOCH I. TOCH even noted in its brief on appeal in TOCH I that since the trial court had made no ruling on the constitutional arguments raised by TOCH, there was nothing to appeal in this regard. The only issue that City and Intervenor could appeal, was the sole issue decided by the trial court. TOCH did not abandon the right to raise constitutional arguments on remand. ¶22 The trial court erred in granting summary judgment on disputed material facts. The Order of the trial court is reversed and this matter remanded for further proceedings consistent with this Opinion. DECISION OF TRIAL COURT REVERSED AND REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. Kane, C.J., Rowe, V.C.J., Kauger, Winchester, Combs, Edmondson, Gurich, Darby, J.J., concur; Kuehn, J., recused. FOOTNOTES 1 The full text of 11 O.S.2011, § 39-108 is as follows in the Improvement District Act: (A) At the hearing of the governing body on the proposed resolution creating a district, any interested person or owner of property to be assessed for the improvement may file a written protest or objection questioning the: (1) Propriety and advisability of constructing the improvement; (2) Estimated cost of the improvement; (3) Manner of paying for the improvement; and (4) Amount to be assessed against the individual tract or parcel of land. (B) The governing body may recess the hearing from time to time so that all protestants may be heard. (C) At the hearing the governing body may: (1) Correct any mistake or irregularity in any proceeding relating to the improvement; (2) Correct an assessment made against any tract or parcel of land; (3) In case of any invalidity, reassess the cost of the improvement against an abutting tract or parcel of land; (4) Delete any tract or parcel of land, protested by the owner, from the district; and (5) Recess the hearing from time to time. (D) Within thirty (30) days after the governing body has concluded the hearing; determined the advisability of constructing the improvement and the type and character of the improvement; and created the improvement district, any person who, during the hearing, filed a written protest with the governing body protesting the construction of the improvement may commence an action in district court to correct or set aside the determination of the governing body. After the lapse of thirty (30) days succeeding the determination of the governing body, any action attacking the validity of the proceedings and the amount of benefit to be derived from the improvement is perpetually barred. Provided, however, if the owners of fifty percent (50%) or more in area of the tracts or parcels within the district or a majority of the owners of record of property in the assessment area protest, in writing, the creation of the district, the district shall not be created. 2 ROA, Doc. #18, p. 792, Ex. 1, Resolution 11938, Jt. Mot. S.J. of City and Intervenor. 3 Id. 4 Id. "Assessments ... shall be calculated and determined in the same manner as the hotel tax established by City of Tulsa Ordinance No. 13288.); See also, Tulsa, OK Code of Ordinances, 13288, Section 101.- Imposition of tax; exemptions: (D) The tax to be collected shall be stated and charged separately from the rent and shall be shown separately on any record thereof at the time when the occupancy is arranged or contracted and charged for.... The tax shall be paid by the occupant to the operator as trustee for and on account of the City, and the operator shall be liable for the collection thereof and for the payment of the tax. The operator and any officer of any corporate operator shall be personally liable for the tax collected or required to be collected under this title...." 5 ROA, Doc. #18, p. 821, Ex. 2, Aff. of Mailing of Deputy of City Clerk of Tulsa, Jt. Mot. S.J. of Def. City and Intervenor. 6 We will not decide now whether it is constitutionally correct to give notice of the creation of improvement district solely to the "owner of the tract or parcel of land" for a proposed assessment for which the hotel Operator is liable. 39-107 B. 7 ROA, Doc. #18, Exs. 4-5, pps. 830 -838, Nov. 5 and Nov. 7, 2018 objection letters, Jt. Mot. S.J. of City and Intervenor. 8 ROA, Doc. #1, Exs. B -- C, pps. 40-47, Nov. 5 and Nov. 7, 2018 objection letters, Plf. Mot. S.J. 9 ROA, Doc. #12, Transcript of Proceedings. 10 ROA. Doc. #2, City Resp. to Plf. Mot. S.J. 11 ROA, Doc. #3. p. 137, Intervnr Resp. to Pltf. Mot. S.J. 12 Id. at 139. 13 ROA. Doc. #11, p. 505, 514, J. Entry of Judgment. 14 Id. 15 Id. 16 ROA, Doc. #18., Exs. 6-10, Affidavits and Declaration, City and Intrvnr Jt. MSJ, (We note that three of the affidavits state that the hotel did not object to the creation of the TID or authorize an objection, which stands in stark contrast to the Notices to Public signed by the same individuals on behalf of the identical hotel objecting to the creation of the TID which is undisputed were filed prior to the Mayor officially signing the Resolution for the TID in December, 2018. No explanation is made for this gross discrepancy. Not only does this highlight the very real question of fact, it also questions the veracity. Two other affidavits were signed by individuals on behalf of a business entity that had no identifiable connection with the property; the entity was not the hotel operator or owner of property as listed on the City's Assessment Roster, the only two apparent entities with legal authority for the hotel. There is nothing in the record to identify what if any authority said entity had in this matter.) 17 ROA, Doc. #35, Order on Cross Motions for Summary Judgment, June 3, 2021. 18 Citing, Horton v. Hamilton, 2015 OK 6, ¶ 8, 345 P.3d 357, 360; see also 12 O.S.2011, § 2056(C).

b705c1c8-8b5d-400c-8ff4-bcfe6935de76

TIB-The Independent Bankers Bank v. Goerke

oklahoma

Oklahoma Supreme Court

TIB-THE INDEPENDENT BANKERS BANK v. GOERKE2023 OK 61Case Number: 119609Decided: 05/31/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TIB-THE INDEPENDENT BANKERS BANK, Plaintiff/Appellant, v. JOSEPH K. GOERKE, Defendant/Appellee, KYLE E. GOERKE aka KYLE EDWARD GOERKE, Spouse, if any of, of KYLE E. GOERKE, JOHN DOE, Occupant, A.E. GOERKE, FRANCES GOERKE, ETHEL B. WILLIAMSON, STATE OF OKLAHOMA ex rel. OKLAHOMA TAX COMMISSION and FIRST STATE BANK, Defendants. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV Honorable Justin P. Eilers, Trial Judge ¶0 Plaintiff/Appellant, TIB-The Independent Bankers Bank, brought a foreclosure action against Defendant, Kyle Goerke, and named Defendant/Appellee, Joseph Goerke ("Goerke"), as a party based on a mortgage he held on the property in question. The trial court granted summary judgment in favor of Goerke, finding that Plaintiff's cause of action was barred based on the doctrines of claim splitting and claim preclusion because Goerke was named in a prior foreclosure action by TIB which was dismissed with prejudice. The Court of Civil Appeals affirmed the trial court. On certiorari, we hold that Plaintiff's claim against Goerke is not barred by the doctrine of claim preclusion. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF THE TRIAL COURT REVERSED. Mark E. Hardin, Pierce Couch Hendrickson Baysinger & Green, L.L.P., Tulsa, Oklahoma, for Plaintiff/Appellant. Andrew Ralph Harroz and Preston M. Sullivan, Chansolme Harroz Hays, PLLC, Oklahoma City, Oklahoma, and Joseph K. Goerke and John A. Krahl, Krahl Goerke Meyer & Behenna, PLLC, Oklahoma City, Oklahoma, for Defendant/Appellee. ROWE, V.C.J.: BACKGROUND ¶1 In August 2015, Plaintiff/Appellant, TIB-The Independent Bankers Bank ("TIB"), filed a foreclosure action ("2015 foreclosure") in Blaine County District Court against Defendant, Kyle E. Goerke, based on a mortgage executed and recorded in 2007. TIB also included claims against Kyle Goerke's brother, Defendant/Appellee, Joseph K. Goerke ("Goerke"), and several of their family members because they possessed a right of first refusal recorded in the chain of title. At the time, Goerke also possessed a second interest in the property, a mortgage recorded in 2015. Although the title report ordered by TIB reflected both of Goerke's interests, TIB only named him as a defendant in the 2015 foreclosure based on his right of first refusal--and not on his mortgage interest. ¶2 Goerke, an attorney, filed an answer in the 2015 foreclosure on behalf of himself and the other family members, noting that their right of first refusal had expired. Accordingly, Goerke claimed they had been improperly named as defendants and demanded that the claims against them be dismissed with prejudice. Goerke did not assert or reference his mortgage interest in his answer. TIB complied with Goerke's demand and dismissed the claims against him and his family members with prejudice. Kyle Goerke later resolved the default, and TIB dismissed the 2015 foreclosure action. ¶3 Kyle Goerke defaulted again shortly thereafter, and on June 15, 2016, TIB initiated a second foreclosure action ("2016 foreclosure") against him, which formed the basis of the present appeal. In the 2016 foreclosure, TIB discovered Goerke's mortgage interest and named him as a defendant on that basis. Goerke filed an answer to the 2016 foreclosure, claiming TIB was barred from bringing further claims against him because TIB dismissed him with prejudice from the 2015 foreclosure. Both TIB and Goerke filed motions for summary judgment. ¶4 On April 22, 2019, the District Court entered an order denying TIB's motion for summary judgment as well as a journal entry granting Goerke's motion for summary judgment. Therein, the District Court made the following findings: (1) that TIB sought a determination in the 2015 foreclosure that its mortgage was superior to Goerke's interest in the property; (2) that TIB's dismissal of Goerke with prejudice from the 2015 foreclosure constituted a judgment on the merits; (3) that TIB had record notice of Goerke's mortgage on the property; (4) that TIB was again seeking a determination that its mortgage was superior to Goerke's interest in the property; and (5) therefore, TIB's claim against Goerke in 2016 foreclosure was barred by the doctrines of claim preclusion and claim splitting. TIB obtained final judgment against Kyle Goerke on May 12, 2021. ¶5 TIB filed its Petition in Error on June 1, 2021. The matter was assigned to the Court of Civil Appeals, Division IV ("COCA") on July 14, 2021. On August 5, 2021, COCA issued an order directing the parties to file simultaneous briefs addressing the following questions: 1) In the first foreclosure, did Joseph Goerke, as an attorney representing himself, have an ethical duty of candor to the trial court and opposing counsel to state that he also had an interest represented by a mortgage? 2) Only to the extent that the Answer is on behalf of Joseph Goerke, did the Answer filed in the first foreclosure contain a misleading statement in Paragraph 3, by alleging "Plaintiff does not have a reasonable or supportable basis to have included these Answering Individuals based upon the specific allegations of its Petition" and did Joseph Goerke have an ethical duty, as an attorney and officer of the court, to then disclose the mortgage he held? 3) If the answer to either or both above Questions is in the affirmative and given that the subjects of the questions were not specifically presented to the trial court in the second foreclosure arguments, is it fundamental error to disregard the affirmative answer(s) when considering the defenses of claim preclusion and claim splitting? (Bank did argue that Joseph Goerke had an equitable duty, but the argument did not specifically address the duty as an attorney and officer of the court.) 4) If the answer to Question 3 is in the affirmative, does the breach of duty and failure by Joseph Goerke as an attorney and officer of the court to disclose the mortgage preclude assertion of claim preclusion and claim splitting by Joseph Goerke? In his response to COCA's order, Goerke claimed that TIB did not raise any issues regarding his nondisclosure of the second mortgage because counsel for TIB acknowledged having notice of Goerke's mortgage when the first foreclosure was filed. COCA then issued another order directing TIB to inform the court whether it disputed Goerke's claim on this point. In its response to the second order, TIB acknowledged that Goerke's mortgage was referenced in the title report prepared for the 2015 foreclosure but "inadvertently omitted from the Petition."1 Nevertheless, TIB disputed that its counsel was "aware of" Goerke's mortgage when it filed the 2015 foreclosure.2 ¶6 COCA issued a published opinion affirming the District Court's judgment. In its Petition for Certiorari, TIB asserts the following propositions of error: (1) the COCA imputed to the Bank the mistake of its foreclosure counsel to deprive the Bank of its rights in a way probably not in accord with applicable decisions of this Court; (2) the COCA's determination that there was an agreement for dismissal was probably not in accord with applicable decisions of this Court; (3) the COCA determined the priority of the mortgages in a way probably not in accord with applicable decisions of this Court; (4) the COCA determined the duty of a litigant to set up all claims in a way that conflicts with the decisions of other divisions of the COCA and conflicts with the decisions of this Court; (5) the COCA's failure to apply the doctrines of waiver and/or estoppel conflicts with applicable decisions of this Court; and (6) the COCA failed to consider constructive fraud in a way probably not in accord with applicable decisions of this Court. STANDARD OF REVIEW ¶7 We review a District Court's order granting summary judgment de novo. Tiger v. Verdigris Valley Elec. Coop., 2016 OK 74, ¶ 13, 410 P.3d 1007, 1011. Likewise, legal questions like those presented in the Petition for Certiorari are subject to de novo review. Johnson v. Midwest City Del City Pub. Schs., 2021 OK 29, ¶ 13, 507 P.3d 637, 641. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. DISCUSSION ¶8 The doctrine of claim preclusion bars "re-litigation by parties or their privies of issues which either were or could have been litigated in a prior action which resulted in a prior judgment on the merits." State ex rel Tal v. City of Okla. City, 2002 OK 97, ¶ 20, 61 P.3d 234, 246 (emphasis added). In order for claim preclusion to apply, there must be (1) a final judgment on the merits in a prior action, (2) involving the same parties or those in privity with them, and (3) the claim in the latter action must arise out of the same transaction or occurrence. See Erwin v. Frazier, 1989 OK 95, ¶ 16, 786 P.2d 61, 64. With respect to the first element, we have previously recognized that a dismissal with prejudice can amount to a judgment on the merits, if predicated on an agreement between the parties. Turner v. Fleming, 1913 OK 155, ¶ 3, 130 P. 551, 552; Boettcher Oil & Gas Co. v. Westmoland, 1941 OK 52, ¶ 9, 113 P.2d 824, 825. ¶9 COCA found that there was no "specific agreement" between TIB and Goerke to dismiss the 2015 foreclosure.3 Yet, COCA found a sufficient mutual understanding of an agreement simply by TIB's dismissal of Goerke.4 TIB alleges that COCA erred in finding that there was an agreement to dismiss the 2015 foreclosure. We agree. ¶10 TIB relies on Eaton v. Allen, 1961 OK 74, 362 P.3d 93, wherein we narrowed the general rule that a dismissal with prejudice based on an agreement amounts to a judgment on the merits. In Eaton, we clarified that where there is room for reasonable doubt as to whether an agreed upon dismissal was intended to bar future litigation arising out of the same transaction or occurrence, said doubt should be resolved by considering extrinsic evidence. Id. ¶ 11, 362 P.2d at 98-99. ¶11 Here, the record is devoid of any extrinsic evidence indicating that TIB's acquiescence to Goerke's request to dismiss the claim based on his right of first refusal was intended to bar future litigation regarding the priority of his interest in the property. Rather, TIB was merely acknowledging that Goerke was correct insofar as his right of first refusal had expired. Without compelling evidence to the contrary, we find that such an acknowledgement does not rise to the level of a settlement agreement. ¶12 Our finding is further supported by the fact that there has been neither an allegation nor a finding of an actual agreement up to this point in the litigation. Notably, Goerke did not allege in his motion for summary judgment that TIB's dismissal was predicated on an agreement between the parties. Additionally, the District Court did not make a finding that the dismissal was the product of an agreement between the parties. Based on the foregoing, TIB's dismissal of Goerke with prejudice in the 2015 foreclosure does not constitute a final judgment on the merits for the purposes of claim preclusion.5 Given our finding that there was no judgment on the merits in the 2015 foreclosure, we need not address TIB's other assignments of error. CONCLUSION ¶13 In order for the doctrine of claim preclusion to be invoked, there must be a final judgment on the merits in a prior action. Erwin, 1989 OK 95, ¶ 16, 786 P.2d at 64. TIB's dismissal of its claim against Goerke based on his right of first refusal in the 2015 foreclosure does not amount to a final judgment on the merits. Accordingly, TIB is not barred from litigating the priority of its mortgage over that of Goerke in the underlying 2016 foreclosure action. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; JUDGMENT OF THE TRIAL COURT REVERSED. Kane, C.J., Rowe, V.C.J., Winchester, Edmondson, and Kuehn, JJ., concur; Kauger, Combs, Gurich, and Darby, JJ., dissent. FOOTNOTES 1 See Appellant's Response to the Court's September 15, 2021, Order, p. 2. 2 Id. 3 Court of Civil Appeals Opinion, at ¶ 53. 4 Id. ¶¶ 53-54. 5 We note here that the determination of whether a particular dismissal constitutes a judgment on the merits is a fact-specific inquiry, and our holding should not be considered conclusive beyond the facts of this case.

25c3cf68-8978-4ff9-b1e6-fc72a89b52dc

Berkson v. Oklahoma ex rel. Administrative Director of the Courts

oklahoma

Oklahoma Supreme Court

BERKSON v. STATE ex rel. ASKINS AS ADMINISTRATIVE DIRECTOR OF THE COURTS2023 OK 70Case Number: 120589Decided: 06/13/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. HOWARD BERKSON, ("Attorney"), in his capacity as a duly licensed and practicing attorney routinely filing, on behalf of himself and his clients, new civil actions in which he and/or his client(s) have been compelled to pay a $10.00 "Lengthy Trial Fund Fee" and all similarly situated people; and JOHN DOE, in his capacity as a non-attorney legal entity able to sue and be sued who, by and through one or more attorneys, has filed new civil litigation in any of the 77 District Courts of Oklahoma and, because said new litigation was filed for him by a lawyer, has been compelled to pay a $10.00 "Lengthy Trial Fund Fee", and all similarly situated legal entities, Plaintiffs/Appellants, v. THE STATE OF OKLAHOMA, ex rel. JARI ASKINS in her official capacity as Administrative Director of the Courts for the State of Oklahoma and ex rel. DON NEWBERRY, in his official capacity as Tulsa County District Court Clerk, and ex rel. all other 76 District Court Clerks of the State of Oklahoma. Defendants/Appellees. APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY ¶0 Lawyer filed an action in the District Court of Tulsa County and challenged a ten-dollar fee collected for the Lengthy Trial Fund when a new case is filed. Defendants filed motions to dismiss. The Honorable Clifford J. Smith, Associate District Judge, granted the two motions to dismiss and lawyer appealed. The State of Oklahoma filed a motion to retain the appeal for review by the Supreme Court and the motion was granted. State of Oklahoma filed a motion for oral argument, the motion was deferred to when the Court considered the appeal. The motion for an appellate oral argument is denied. We hold: Lawyer's assignments of procedural error are not preserved for appeal; Lawyer's assignments of error based upon legal standing to bring the action are correct in part; The two orders granting the motions to dismiss must be affirmed on the ground lawyer's petition failed to state a claim upon which relief could be granted. ORDERS OF DISTRICT COURT AFFIRMED Edward L. White, Edmond, Oklahoma, for Plaintiffs/Appellants. James W. Dunham, Jr., Tulsa, Oklahoma, for Plaintiffs/Appellants. Kevin McClure, Assistant Attorney General, and Jessica Wilkes, Assistant Attorney General, Oklahoma City, Oklahoma for Defendant/Appellee, State of Oklahoma, ex rel. Jari Askins. Douglas A. Wilson, Assistant District Attorney, Tulsa, Oklahoma, for Defendant/Appellee, Don Newberry in his official capacity as Tulsa County District Court Clerk. EDMONDSON, J. ¶1 A lawyer, Berkson, brought an action in the District Court of Tulsa County challenging a Lengthy Trial Fund (LTF) fee collected from an attorney filing an action with the court clerk. We ultimately conclude Berkson's petition failed to state a claim that 28 O.S. § 86 is an unconstitutional special law and the trial court properly granted the two motions to dismiss filed by the two defendants. We affirm the two orders of the District Court. ¶2 Before addressing the constitutional issue, we must address the six assignments of error raised by Berkson in his petition in error. Two raise the procedure in the District Court as independent grounds for reversal, and they involve both the scope of our appellate review and appellate jurisdiction. The two procedural assignments of error were brought for review in an accelerated appeal but they are improperly preserved by a term-time motion to vacate. Further, even if the term-time motion to vacate could be deemed a functional equivalent to a motion for new trial for the purpose of this accelerated appeal, the assignments would not be preserved due to Berkson's failure to raise them, as shown by an appellate record, prior to his post-dismissal motion. The remaining four assignments involve Berkson's legal standing to bring his action and he is partially correct. However, the assignments of error on standing are not sufficient for an appellate reversal and the orders must be affirmed for a different reason. I. Trial Court Proceedings ¶3 Berkson's trial court petition challenged a ten-dollar fee collected from each attorney who files a civil case. The clerk of the court "shall collect from each attorney who files a civil case, unless otherwise exempted under the provisions of this section, a fee of Ten Dollars ($10.00) per case to be paid into the Lengthy Trial Fund." 28 O.S.2021 §86(D)(2). The petition requested class certification, a declaration 28 O.S. § 86 is an unconstitutional special law, an injunction to prevent collection of the fee, accounting for fees collected in the previous three years, disgorgement of collected fees and restitution, and costs and fees to Berkson. The action named the Tulsa County District Court Clerk (Newberry), and the State of Oklahoma, ex rel., Administrative Director of the Courts, Askins, (the State). ¶4 The State filed a motion to dismiss and raised four grounds. The State challenged Berkson's standing to bring the action based upon allegations on the face of the petition. The State invoked 12 O.S. § 2012(B)(6), the petition's "failure to state a claim upon which relief can be granted," and argued 28 O.S. § 86 was not a special law. The State argued Berkson's claim was subject to the Governmental Tort Claims Act (51 O.S.2021 § 151, et seq.), and Berkson had not complied with the Act. The State argued Berkson's petition failed to allege he had followed the protest procedure in 62 O.S. § 206 for an alleged unconstitutional fee. The State requested the claims against it be dismissed "with prejudice." ¶5 Newberry filed a motion to dismiss and raised 12 O.S. § 2012 (B)(1)(6)(10), respectively, "lack of jurisdiction over the subject matter," "failure to state a claim upon which relief can be granted," and "lack of capacity of a party to sue." Newberry's motion also challenged Berkson's legal standing to bring the action and requested the trial court take judicial notice of a fact not appearing on the face of Berkson's petition. Newberry requested the motion to dismiss be granted "with prejudice." ¶6 Berkson filed a combined response to both motions and also requested the court to take judicial notice of facts not appearing on the face of their petition. He referenced two additional proceedings before the Tulsa County District Court relating to paying filing fees. He attached a copy of his "Notice of Protest" filed with the District Court Clerk on the same day he filed his petition. The trial court granted both motions to dismiss by separate orders, which do not state a specific ground or reason other than the court reviewed the motions, a response, and heard the argument by counsel at the hearing on the motions. The two orders were filed on two successive days.1 ¶7 Berkson filed a "motion to reconsider" and raised procedural issues: (1) He was not allowed to give his "approval as to form" for the dismissal orders signed by the trial judge; (2) He was not provided an opportunity to request findings of fact and conclusions of law; and (3) The dismissal orders failed to state whether or not the dismissals were without prejudice. The motion made a few other arguments including one related to his standing to bring his action. The motion to reconsider was filed more than ten days after both dismissal orders were filed. ¶8 Berkson filed a petition in error in this Court three days after filing his motion to reconsider in the District Court. His petition in error asserts six assignments of error challenging the two dismissal orders, four involve his standing to prosecute his action and two raise procedural issues. The procedural issues are urged as grounds to reverse the dismissal orders independent of the issues related to standing. The trial court subsequently denied Berkson's motion to reconsider. Berkson did not file a new petition in error challenging the order denying the motion to reconsider. II. Preserved Error in an Accelerated Appeal and Berkson's Term-Time Motion ¶9 An initial question in this appeal is whether Berkson's' two assignments of procedural error in his petition in error are preserved for appellate review. Four related preservation issues are present: (1) Whether appellants, generally, may include in the record of an accelerated appeal pursuant to Okla. Sup. Ct. R. 1.36 a term-time motion to vacate pursuant to 12 O.S. §1031.1 as well as the order adjudicating the motion; (2) Whether the order adjudicating the term-time motion must be separately appealed to challenge the order as well as preserve error relating to the term-time proceedings; (3) If Berkson could include the term-time motion in this appellate record as a deemed functional equivalent to a motion for new trial due to the trap-for-the-unwary doctrine; and whether the motion so deemed could be used to preserve error not occurring on the face of the appellate record prior to Berkson's term-time motion; and (4) Whether the substance of the objections in the term-time motion is sufficient to preserve the error assigned in the petition in error. We conclude the two procedural assignments of error in the petition in error were not preserved for appellate review. ¶10 The two assigned errors in procedure are: (1) "Whether the District Court erred by failing to require submission of Defendants' proposed orders for review by Plaintiff in violation of Tulsa Local Civil Rule 29;" and (2) "Whether the District Court erred by failing to give plaintiffs leave to amend its petition."2 The trial court did not require submission of defendants' proposed orders for review by Berkson prior to signing the orders.3 Berkson argues he was denied an opportunity to request findings of fact and conclusions of law. This issue is not raised in Berkson's trial court petition, or the combined response to the two motions to dismiss filed by defendants, or any motion filed by Berkson prior to the dismissal orders. ¶11 The record on appeal does not include a transcript of the hearing on the motions to dismiss, or a narrative statement in lieu of transcript. The record on appeal does not show Berkson raising the alleged procedural error until the motion to reconsider. ¶12 A "motion to reconsider" does not technically exist within the statutory nomenclature of Oklahoma practice and procedure.4 A motion to reconsider may be treated as a motion for new trial (12 O.S. §651), or a motion to vacate or modify (12 O.S §§ 1031, 1031.1) or some other motion based upon the substance of the motion, the time the motion was filed, and the motion's application to the case.5 Berkson's motion to reconsider filed more than ten, but within thirty, days after the two dismissals is a term-time motion to vacate pursuant to 12 O.S. § 1031.1.6 Berkson cites this statute as authority in the motion for requested relief. A motion filed pursuant to 12 O.S. § 1031.1 is not merely a late-filed motion for new trial. Although a motion for new trial and a term-time motion have some similarities for some purposes,7 differences between the two motions may have consequences for appellate review. ¶13 Our review in an accelerated appeal is primarily limited to the order appealed. For example, on review of a summary judgment in an accelerated appeal pursuant to Okla. Sup. Ct. R. 1.36: "Ordinarily, an appellate court will not take notice on review of any material that was not properly before the trial court in the decisional process that led to summary judgment."8 Rule 1.36(g) expressly provides: "The appellate court shall confine its review to the record actually presented to the trial court." We have explained a timely-filed 12 O.S. § 651 motion for new trial extends time to appeal, and on its denial, if error was properly preserved, the movant may secure full review of the entire judgment and all proceedings that led to it.9 ¶14 An accelerated appeal may also include review of a motion for new trial. An appeal of an order adjudicating a timely filed motion for new trial must be prosecuted in an appeal which may challenge the antecedent judgment or final order. 12 O.S.2021 §990.2. This statute states in part the following. When a post-trial motion for a new trial, for judgment notwithstanding the verdict, or to correct, open, modify, vacate or reconsider a judgment, decree or final order, other than a motion only involving costs or attorney fees, is filed within ten (10) days after the judgment, decree or final order is filed with the court clerk, an appeal shall not be commenced until an order disposing of the motion is filed with the court clerk. The unsuccessful party may then appeal from the order disposing of the motion within thirty (30) days after the date such order was filed. If the decision on the motion was against the moving party, the moving party may appeal from the judgment, decree or final order, from the ruling on the motion, or from both, in one appeal, within thirty (30) days after the filing of the order disposing of the motion. Successive appeals from the original judgment, decree or final order and the order disposing of the motion shall not be allowed. 12 O.S.2021 §990.2(A) (emphasis added). Similarly, we have explained an appellate review of a motion for new trial after summary judgment occurs in an accelerated appeal pursuant to Rule 1.36.10 Additionally, and consistent with 12 O.S. §990.2, Rule 1.36 states: "Appeals in these [Rule 1.36] cases will be commenced by filing a petition in error with the certified copy of dismissal order or of summary judgment and, where applicable, a certified copy of the order denying new trial, with payment of costs or an affidavit in forma pauperis." Okla. Sup. Ct. R. 1.36(b) (emphasis and explanation added). ¶15 In contrast to invoking a trial court's discretion to grant a new trial based upon 12 O.S. § 651 and filing the motion within ten days after a final dismissal order, Berkson requested the District Court exercise its 12 O.S. §1031.1 term-time authority to vacate the dismissal orders.11 Orders denying either a modification or vacating a judgment, or refusing to modify or vacate a final order,12 are themselves final orders,13 and are appealed separate and independent from an appeal challenging an antecedent judgment or final order.14 ¶16 Appellate review of a decision adjudicating a 12 O.S. § 1031.1 motion is conditioned upon filing a new petition in error challenging the trial court's decision in a new appeal. Southeastern, Inc. v. Doty, 1971 OK 17, 481 P.2d 144, 147. Consistent with Southeastern, Okla. Sup. Ct. R. 1.36(k) states in part: "An appeal governed by Rule 1.36 is prosecuted separately from another appeal from the same trial court case when the appeals challenge different appealable decisions." Consistent with both Southeastern, Inc. v. Doty, and Rule 1.36(k), we have explained in an appeal from an order denying 12 O.S. §1031 or §1031.1 relief "this court may not look to the original judgment but stands confined in its review to the correctness of the trial court's action" deciding the motion filed pursuant to 12 O.S. §§1031, 1031.1.15 A second appeal invoked by a second and new petition in error from an order adjudicating a post-judgment request to vacate is often, but not required to be, consolidated with the first appeal.16 Berkson did not appeal the order denying his 12 O.S. § 1031.1 motion to vacate as required by both Southeastern, Inc. v. Doty, supra, and Rule 1.36(k), so he fails to secure appellate cognizance over his motion to vacate or the subsequent order on the motion. ¶17 A petition in error is examined using a substantial compliance analysis to determine its sufficiency to give a required notice to opposing parties.17 We examine the content and substance of a filing in this Court to determine the type of relief sought by the party.18 We examine the language used in the assignments of error to determine the issues that are "fairly comprised within appellants' assignment of error."19 Berkson's petition in error challenges the two dismissal orders and not judicial discretion exercised when the 12 O.S. § 1031.1 motion was decided by the trial court. However, Berkson filed this term-time motion to reconsider, responses by defendants, and the order denying the motion as part of the Rule 1.36 appellate record. ¶18 Rule 1.36(c) states: "The record on appeal will stand limited to:" and then the Rule lists the items used in support of an appellate challenge to summary judgment and final orders on motions to dismiss. Rule 1.36(c)(B) lists items in an appellate record from an appealed final order on a motion to dismiss, and this list includes: "(9) any motions, along with supporting and responsive briefs, for a new trial (re-examination) of the dismissal order."20 The term "reexamination" occurs in the statute authorizing a new trial.21 The statute invoked by appellants in their motion to reconsider, 12 O.S. §1031.1, does not include the term "reexamination," and states in part "[a] court may correct, open, modify or vacate a judgment, decree, or appealable order." The language in 1.36(c)(B)(9) references a motion for new trial filed within ten days of the judgment or final order, and not a term-time motion pursuant to 12 O.S. §1031.1 filed more than ten days after the appealable order. ¶19 Requiring a new petition in error to invoke appellate review of an order denying a 12 O.S. § 1031.1 motion to vacate was a legal norm prior to 1971,22 reaffirmed in our 1971 opinion in Southeastern, Inc. v. Doty, and also reaffirmed after Southeastern.23 Requiring a new petition in error to commence a new appeal and invoke appellate review of an order denying a 12 O.S. § 1031.1 motion to vacate was and is a clearly settled legal norm prior to today's case. ¶20 We conclude: A term-time section 1031.1 motion may not be used as part of a Rule 1.36(c) record for the purpose of raising and preserving for the first time an alleged error in the antecedent order reviewed in the accelerated appeal. This conclusion is consistent with other parts of Rule 1.36, such as Rule 1.36(k) and its requirement that different appeals be prosecuted for different appealable decisions, and Southeastern, Inc. v. Doty, supra. We consider the language in 1.36 (c)(B)(9) as a trap-for-the-unwary in this case to the extent Berkson failed to distinguish a motion for new trial from a term-time motion to vacate when creating his appellate record.24 However, even when we consider the trap-for-the-unwary doctrine as allowing Berkson's motion to reconsider to be deemed the functional equivalent to a motion for new trial in a Rule 1.36 proceeding, the procedural issues raised by Berkson's motion are not properly preserved for assignments of error in the appeal. ¶21 Berkson argues as a procedural assignment of error he was denied an opportunity to request findings of fact and conclusions of law after the trial court announced its decision.25 When a motion for new trial is filed, an allegation of nonfundamental error in a motion for new trial must be based on the error being previously preserved in the course of trial proceedings,26 unless the nature of the error requires a different analysis, such as requiring an examination of a party's diligence in discovering error,27 or when a different standard is applied for the purpose of a new trial motion.28 ¶22 Historically, when a trial court did not provide timely requested findings of fact and conclusions of law relating to an adjudication on the merits,29 the aggrieved party was required to preserve the error in the trial court.30 A request for findings of fact and conclusions of law came too late when made after the trial court indicated its decision.31 Additionally, we have held a request for findings of fact and conclusions of law came too late when made for the first time in a motion for new trial after a judgment on the merits.32 The same may be said for Berkson raising the issue of findings of fact and conclusions of law for the first time in his term-time motion after the motions to dismiss were granted. ¶23 Berkson also urges as error the form of the two orders was not proper because they failed to state whether Berkson could amend his petition. Both defendants expressly requested in their motions a dismissal with prejudice, and Berkson did not respond whether defendants were contesting the existence of Berkson's claim or if an amendment was proper pursuant to 12 O.S. § 2012(G).33 Berkson's response is silent on the issue of dismissals with prejudice pursuant to 12 O.S.§2012. Berkson's motion to reconsider did not urge as error they were improperly denied an opportunity to amend,34 or that the defendants' motions challenged a defectively stated claim instead of challenging whether Berkson's claim did not exist.35 ¶24 In Oklahoma, a 12 O.S. § 2012(B)(6) motion tests the law governing the claim, not the underlying facts, and makes a decision on the legal sufficiency of a petition;36 and the court may determine the petition suffers from a non-existence of a cause of action making an opportunity to amend futile for a plaintiff's case. For example, a District Court's 12 O.S. § 2012 dismissal of an action is reviewed de novo and a decision denying an amendment is based upon an abuse of discretion when allegations show futility in the amendment,37 and abuse of discretion may be based upon an issue of law.38 ¶25 Berkson did not preserve his allegation of error concerning an opportunity to amend the petition when defendants specifically requested a dismissal with prejudice, and his response was silent on whether defendants had a burden to show futility of an amendment and if the face of Berkson's pleading showed such futility.39 We conclude both assignments of procedural error by the trial court are not preserved for appellate review. III. Four Assignments of Error and Standing ¶26 Berkson's petition in error has four remaining assignments of error and all relate to his legal standing to bring the action in District Court. The State's motion argued Berkson lacked standing on the face of his petition. Newberry's motion asserted Berkson lacked standing. Newberry raised facts on the face of the petition as well as a fact beyond the face of the petition and invoked judicial notice with an attached exhibit. Newberry's motion challenged the veracity of Berkson's allegation he paid the lengthy trial fund fee. Berkson's response asserted Newberry's motion was factually incorrect, and Berkson also invoked judicial notice concerning two cases on the Tulsa District Court docket ¶27 The State's argument on standing is insufficient to support a dismissal for Berkson's lack of standing. The State relied on the Oklahoma Rules of Professional Conduct Rule 1.8, and pointed to language in the first sentence of Comment [10]: "Lawyers may not subsidize lawsuits or administrative proceedings brought on behalf of their clients, including making or guaranteeing loans to their clients for living expenses, because to do so would encourage clients to pursue lawsuits that might not otherwise be brought and because such assistance gives lawyers too great a financial stake in the litigation."40 The remaining language in Comment [10] to Rule 1.8 states as follows. These dangers do not warrant a prohibition on a lawyer lending a client court costs and litigation expenses, including the expenses of medical examination and the costs of obtaining and presenting evidence, because these advances are virtually indistinguishable from contingent fees and help ensure access to the courts. Similarly, an exception allowing lawyers representing indigent clients to pay court costs and litigation expenses regardless of whether these funds will be repaid is warranted. This language in the Comment allows a lawyer to pay court costs for a client when the client's lawsuit is filed, and Rule 1.8 expressly allows a lawyer to advance a court cost with repayment contingent on the outcome of the client's lawsuit. (e) A lawyer shall not provide financial assistance to a client in connection with pending or contemplated litigation, except that: (1) a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter; and (2) a lawyer representing an indigent client may pay court costs and expenses of litigation on behalf of the client. 5 O.S.2021 Ch. 1, App. 3-A, Rule 1.8(e)(1) & (2). The State recognized the petition stated Berkson is a lawyer and pled that he "in fact does pay filing fees charged by District Court Clerks," and "Attorney [Berkson]" and Doe . . . who have paid and/or been compelled to pay, one or more times . . ."a 'Lengthy Trial Fund' fee." The State argued this language was insufficient because: "[A]n attorney cannot finance lawsuits on behalf of his clients, subject to few exceptions that Berkson has not pled . . . Berkson's clients are the true bearers of any LTF fees."41 ¶28 We have explained: "Notice pleading does not require pleading every fact upon which a claim is based, but merely a short and plain statement of the claim that will give fair notice of what the plaintiff's claim is and the grounds upon which it rests."42 Berkson's statements in his petition give notice he has paid the LTF fee on behalf of a client. The State's motion raised its defenses as part of 12 O.S. § 2012(B)(6) and the State challenged the facial sufficiency of Berkson's petition, i.e., the facial sufficiency of the allegations for the purpose of providing notice of the claim. ¶29 The State's argument that Berkson's clients are the true bearers of any LTF fees goes to whether Berkson has been damaged when he has paid the fee on behalf of a client. Berkson argued in the trial court "where Berkson's client fails to recover any money, he [Berkson] is permanently deprived of his funds." The State's challenge to the face of the petition does not challenge the fact Berkson paid funds, but whether the allegations are sufficient as a matter of law.43 Generally, the allegations of a petition on a § 2012(B)(6) assessment, like a Rule12(b)(6) review of a federal court complaint,44 are presumed or deemed true for the purpose of testing the sufficiency of the pleading, and this principle applies to a motion to dismiss challenging legal standing of a plaintiff.45 In Bowlin v. Alley, we explained a party had standing to challenge the constitutionality of a statutory attorney's fee when the party had a personal stake due to being forced to pay the fee.46 The State's motion fails to show an insufficiency of Berkson's legal standing on the face of his petition. ¶30 Newberry's motion also cited Rule 1.8 and its exception that a lawyer may pay a filing fee for a client. Newberry argued Berkson does not have standing and cited Cities Service Co. v. Gulf Oil Corp., 1999 OK 16, 976 P.2d 545. The standing question in Cities Service was whether a lawyer, sanctioned by limiting the lawyer's participation in a client's trial which had concluded, possessed standing independent of the client to seek appellate review of the sanction order. Id. 1999 OK 16, ¶6, 976 P.2d 547-48. We concluded the attorney lacked standing and observed "there is no reasonable likelihood that the alleged harm would be redressed by a favorable opinion." Id. 1999 OK 16, ¶8, 976 P.2d at 548 (emphasis in original). ¶31 Newberry's motion does not address whether Berkson's alleged injury could be redressed by a remedy in the District Court.47 The availability of a remedy appears tangentially mentioned by Newberry when discussing the transfer of a collected fee to the Administrative Office of the Courts. Berkson's petition expressly requests an order requiring Newberry, as a District Court clerk, to immediately cease collecting the fee. Newberry's motion does not show Berkson's petition is facially insufficient based on Cities Service Co. v. Gulf Oil Corp., supra. ¶32 Newberry's motion to dismiss also challenges the veracity of Berkson's allegation he had previously paid the court fee. Newberry relies on judicial notice for his argument. Berkson also relies on judicial notice for the issue of his standing in response. ¶33 In Farley v. City of Claremore, 2020 OK 30, 465 P.3d 1213, we discussed using judicial notice in support of a motion to dismiss and a similar federal civil procedure. We noted the Farley litigants did not dispute the judicial notice and agreed with the truth of the statements contained in the document noticed. Farley, 2020 OK 30, ¶¶12-18, 465 P.3d at 1221-25. ¶34 In a federal court, a party may, in some circumstances, raise a fact not appearing on the face of a plaintiff's complaint for the purpose of a motion to dismiss adjudicating a jurisdictional claim.48 Generally, in federal court a party may use judicial notice as a method for challenging jurisdiction.49 However, when judicial notice of public documents is used by a court ruling on a motion to dismiss in a federal court, "the documents may only be considered to show their contents, not to prove the truth of matters asserted therein."50 This concept is similar to the well-known principle in a federal court stating a court may take judicial notice of the existence of a court opinion, but not the facts stated in the opinion.51 ¶35 A federal court takes judicial notice when the court "recognizes the truth of a matter that is either 'generally known' or 'capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.'"52 Similarly, in an Oklahoma court, judicial notice may be allowed when an adjudicative fact "shall not be subject to reasonable dispute." 12 O.S.2021 §2202.53 ¶36 Newberry and Berkson dispute what is known concerning Berkson's standing. Newberry and Berkson attach a different meaning and significance to the facts raised by the petition and requests for judicial notice, i.e., their arguments do not show agreement between (1) a fact stated on the face of the petition or by judicial notice that must be stated to a finder of fact, and used to allege or prove and (2) the related factual proposition required for legal standing.54 Judge Hand explained when a fact is in a public document noticed, the document "would not be conclusive, or more than evidence."55 Newberry and Berkson disagree on which request for judicial notice is correct, or has priority, or is proper for determining Berkson's standing. ¶37 In both federal and Oklahoma courts an evidentiary hearing is used to adjudicate disputed jurisdictional issues of fact.56 We have explained a purpose for summary judgment does not include substituting a trial by affidavit for a trial by jury.57 Similarly, a purpose for a motion to dismiss does not include substituting judicial notice for an evidentiary hearing when a court is presented with a disputed issue of fact by judicial notice. ¶38 An appellant must provide an appellate record necessary to review the error assigned by the appellant, and legal error by a trial court is not presumed on appellate review.58 Argument and comments by counsel are not evidence for creating a record of fact on the nature of the trial court's ruling.59 Nothing in the record suggests an evidentiary hearing occurred, or that the trial court made a finding of fact on Berkson's legal standing when it granted Newberry's motion to dismiss. Nothing in the record indicates which judicial notice, if any, was actually used by the trial court when the motion to dismiss was granted. Berkson's assignment of error based upon the trial court adjudicating standing with issues of fact raised by judicial notice is not supported by an appellate record. ¶39 The record is sufficient to determine whether Berkson's petition is facially sufficient for the purpose of Newberry's challenge to Berkson's legal standing alleged on the face of his petition. The petition was sufficient on its face to show standing, Bowlin v. Alley, supra.60 However, the dismissal orders must be affirmed on a different ground. ¶40 Historically, in an appeal from a dismissal based upon a trial court sustaining a demurrer to a petition on a wrong ground, "this court will consider all grounds assigned [in the demurrer] and the order will be sustained if any such ground is well taken."61 We recently explained in Farley v. City of Claremore, supra, in the context of a non-jury adjudication in the form of a trial court's dismissal order: (1) "A long-recognized rule is that when a judgment is general in its terms and does not disclose which of several grounds it is based upon, it will not be reversed on appeal if any one of the grounds raised in the trial court is a valid basis for the judgment;" and (2) "This rule that only one legally valid basis is needed for a judgment or judicial decision applies to appellate review of a trial court's order sustaining a motion to dismiss." Id. 2020 OK 30, ¶19, 465 P.3d at 1225. ¶41 The two dismissal orders do not specify a ground for granting the motions to dismiss. Although Berkson's assignments of error relating to standing are correct, in part, the other defenses raised by defendants' motions are before us in the appeal, and the orders must be affirmed if one of them is sufficient for granting the motions to dismiss. One of these defenses was the constitutionality of the fee statute. Ordinarily, when legal relief is sought upon an alternative non-constitutional ground, a prudential rule of judicial restraint defers adjudication of the constitutional issue.62 However, Berkson's lawsuit is based upon the alleged unconstitutionality of a statutory court fee collected statewide for the purpose of jury fees, the claim is publici juris,63 and if the statute is constitutional then additional trial court proceedings would be futile for Berkson and judicial economy for the trial court would be accomplished by a constitutional analysis at this time. We address the the constitutional issue. IV. Special Law Claim and Dismissal Based Upon 12 O.S.2021 § 2012(B)(6) ¶42 We exercise a de novo appellate process when reviewing constitutionality of a state statute in the context of an order on a motion to dismiss.64 We rely on Berkson's petition, his trial court response to defendants' motions, and any additional trial court filings properly part of the Oka. Sup. Ct. R. 1.36 appellate record for our de novo review.65 Our review is also proper at this time because Berkson's petition and argument in the trial court treat the fee statute as facially creating allegedly impermissible classes of similarly situated plaintiffs. ¶43 Berkson's petition alleges he must (1) pay a statutory filing fee and (2) this fee is an unconstitutional special law. The petition does not identify a provision of the constitution allegedly violated by the statute. Defendants argued Berkson was required to give them notice whether their lawsuit was based upon Okla. Const. Art. 5 § 46 or Okla. Const. Art. 5 § 59. ¶44 Berkson responded that the allegations of his petition "adequately describe the constitutional principle at issue," and the petition need not identify the constitutional provision prohibiting a special law.66 His response does cite four opinions of this Court involving a special law analysis. However, these four include three applying Okla Const. Art. 5 § 4667 and one applying Okla. Const. Art. 5 § 59.68 The authority cited does not settle this issue on the nature of Berkson's claim.69 ¶45 A constitutional attack to a statute as a special law pursuant to Okla. Const. Art. 5 § 46 is not identical to one based upon Okla. Const. Art. 5 § 59.70 In Zeier v. Zimmer, 2006 OK 98, 152 P.3d 861, we explained these two sections may require a different analysis when assessing the constitutionality of a statute.71 A special law is one that relates to a part of an entire class of similarly affected persons and separates that part for different treatment.72 The Oklahoma Constitution, Art 5, §46, prohibits the Legislature from passing special laws relating to specific subject areas, and Art. 5, §59 requires the Legislature to enact a general law, and not a special law, whenever possible.73 We analyze Berkson's claim of an impermissible special law based upon the allegations he pleads for his case to determine the nature of his complaint and his challenge to 28 O.S. § 86. ¶46 Berkson alleges a statute operates on a class of similarly affected persons, "segregates out a subset of litigants," and this creates an impermissible special law.74 The portion of 28 O.S. § 86 challenged by Berkson states as follows. 2. The clerk of the court shall collect from each attorney who files a civil case, unless otherwise exempted under the provisions of this section, a fee of Ten Dollars ($10.00) per case to be paid into the Lengthy Trial Fund. A lawyer will be deemed to have filed a case at the time the first pleading or other filing on which an individual lawyer's name appears is submitted to the court for filing and opens a new case. All such fees shall be forwarded to the Administrator of the Lengthy Trial Fund for deposit. . . . 6. The following attorneys and causes of action are exempt from payment of the Lengthy Trial Fund fee: a. government attorneys entering appearances in the course of their official duties, b. pro se litigants, c. cases in small claims court or the state equivalent thereof, or d. claims seeking Social Security disability determinations, individual veterans' compensation or disability determinations, recoupment actions for government backed educational loans or mortgages, child custody and support cases, actions brought in forma pauperis, and any other filings designated by rule that involve minimal use of court resources and that customarily are not afforded the opportunity for a trial by jury. 28 O.S.2021 § 86 (D) (2) & (6). He argues the fee "properly fall upon all legal entities filing new civil cases in which either or both of the parties are customarily, statutorily, or by constitutional right entitled to a jury trial."75 Berkson's petition includes the following. [J]uries are not generally empaneled in small claims, child custody/support cases, probates, cases seeking equitable relief only and others. Therefore, it is rational (not arbitrary and capricious) to exempt such matters/litigants from paying a filing fee that funds impaneling juries, as they, in the words of subsection (d), 'involve minimal use of court resources and that customarily are not afforded the opportunity for a trial by jury.' ROA, Petition, pgs. 5-6. Berkson's response to defendants' motions explains that "not all special laws are unconstitutional," and he has no complaint concerning three of the categories in 28 O.S. § 86(D)(6). ¶47 Berkson objects to exempting pro se litigants because an attorney may file a pro se action and the action may then require a lengthy trial.76 Berkson argues statutory arbitrariness is shown by the possibility an attorney could appear pro se and pro se parties may engage in protracted litigation.77 Berkson argues in both his petition and response the constitutional infirmity in the statute could be remedied by changing the statutory language which collects the fee "from each attorney" to collecting the fee from "each person or other legal entity."78 Again, the allegations of the Petition and arguments in Berkson's response to defendants' motions show that he does not have an objection to all four categories in 28 O.S.2021 §86 (D)(6), but solely to pro se plaintiffs not paying the fee. ¶48 The purpose of court fees is to reimburse the state for money that otherwise would have to be appropriated for the maintenance of the courts. Fent v. State ex. rel. Dep't of Human Services, 2010 OK 2, ¶10, 236 P.3d 61, 66. The legislature may impose court costs when such costs are in the nature of reimbursement to the state for services rendered by the courts. Id. The fee "must be related to services rendered by the courts or maintenance of the courts." Id. 2010 OK 2, ¶11, 236 P.3d at 66. ¶49 Two statutory classifications for a court filing fee have been discussed in our opinions, fees for maintenance and fees for performing an individual service by a clerk. For example, in Fent we mentioned court maintenance fees and discussed the example of Farabee v. Board of Trustees, Lee County Law Library, 254 So. 2d 1 (Fla.1971). Fent, at ¶13, 236 P.3d at 67. Farabee explained a public court library was essential to the administration of justice, and a filing fee was an appropriate cost to be assessed against those who made use of the court system. Farabee, 254 So. 2d at 5. In Naylor v. Petuskey, 1992 OK 88, 834 P.2d 439, we discussed a fee a court clerk charges a litigant "for the performance of specified services, which are not ordinary, routine services afforded every litigant and are not included in the initial filing fee." Id. at ¶6, 834 P.2d at 441. ¶50 A fee collected from each attorney filing a case, 28 O.S. § 86(D)(2) has the nature of a maintenance fee because the fee is collected without consideration whether the particular cause of action will result in a lengthy trial. The question raised by Berkson is whether the four categories in 28 O.S. §86(D)(4) are constitutionally consistent, or reasonably related, with the fee collected from attorneys in 28 O.S. §86(D)(2). ¶51 Berkson's petition does not contend the Legislature lacks the power to create three of the four categories in §86 (D)(4). Berkson challenges the pro se exemption because it lacks "any logical connection between the nature of the action filed [by a pro se] and its likelihood of resulting in a lengthy trial."79 He argues the logical connection does not exist because a theoretical possibility exists for a pro se attorney to seek a lengthy trial.80 In other words, a theoretical possibility for a pro se attorney's lengthy trial shows that the Legislature could not have reasonably determined that pro se plaintiffs' actions, as a class, would likely be disposed without a lengthy trial. Again, Berkson attacks the reasonableness of the legislative classification. ¶52 Generally, in some circumstances courts accord substantial deference to the predictive judgments of legislative authorities because legislative policymaking often requires a forecast of future events with an anticipation of the likely impact of these events based upon legislative deductions and inferences.81 Some courts explain this legislative judgment must have some footing in the realities of the subject addressed by the legislation based on a reasonably conceivable state of facts.82 This type of deference is often observed in cases attacking a legislative classification as unreasonable, arbitrary, and capricious in equal protection cases applying a rational-basis test.83 We have explained a constitutional equal protection guarantee does not mirror the prohibitions against an impermissible special law, and a statute may be an unconstitutional special law for its silent omission to include others within the scope of the statute who are similarly situated.84 While a standard for arbitrariness and reasonableness may be slightly different between certain equal protection classifications and special law classifications of reasonableness, we must still consider the type of legislative judgments made for a statutory class and the object of a statute with its relation to similarly situated members of a class. ¶53 We presume a statute is constitutional when challenged.85 We must determine whether a statute has adopted "a classification that is arbitrary and capricious and bears no reasonable relationship to the object of the Legislation."86 Contrary to Berkson's argument, we read 28 O.S. § 86 as a legislative determination that pro se plaintiffs are not similarly situated to attorney-represented plaintiffs for the purpose of collecting a lengthy trial fund fee. Berkson's allegation is that 28 O.S. § 86 is an impermissible special law because actions brought by pro se plaintiffs include pro se lawyers and such result has "no reasonable relationship" to the object of the statute when collecting a fee for the lengthy trial funds. Berkson's claim appears to rest upon the ideas that: (1) The Legislature could not, as a matter of law, anticipate the likely impact of section 86, and base its legislative deductions upon a conclusion that any attorney acting reasonably would obtain her or his own lawyer when possessing an action requiring a lengthy jury trial; or (2) The Legislature could not, as a matter of law, determine lawyers are less likely to file a pro se action due to certain circumstances, such as cases when there is uncertainty in obtaining a lawyer's pro se attorney's fee.87 ¶54 Generally, a statutory classification is constitutional as long as the classification is reasonable, there is a reasonable opportunity for uniform application on the class created, and the statute is general in its application and embraces all of the given class.88 We must determine whether the allegations in Berkson's petition indicate beyond any doubt that he can prove no set of facts which would entitle him to relief for his claim that 28 O.S.2021 § 86 is an unreasonable special law.89 His petition indicates the legislature made a determination concerning the likelihood of lengthy jury trials for certain litigants in 28 O.S.2021 §86(D)(6), and that this classification is unreasonable. We disagree; the legislative determination is reasonable. We conclude section 86 does not unreasonably create two classes of litigants similarly situated. V. Conclusion ¶55 We conclude the petition failed to state a claim that 28 O.S. § 86 is an unconstitutional special law. The two orders of the District Court of Tulsa County are affirmed. ¶56 ALL JUSTICES CONCUR. FOOTNOTES 1 We need not analyze the issue of finality with respect to multiple dismissal orders in multi-party litigation or the relationship between these two orders. The issue does not alter either the Court's appellate jurisdiction in this matter or the appellate adjudication of Berkson's assignments of error. For the purpose of this opinion we refer to the two orders as final orders of dismissal, or two orders of dismissal. 2 The plaintiff, Berkson, sought to include a class of plaintiffs in his case. References to "plaintiffs" herein are used interchangeably with the plaintiff Berkson without any significance to his allegations concerning a class of plaintiffs. 3 Rules of the Fourteenth Judicial District (Tulsa and Pawnee Counties), Rule CV 29, Journal Entries, Orders and Decrees, states in part: "Every journal entry, order, decree or other judgment presented to the Court for signature shall contain the approval as to form by the attorneys for each of the parties, unless waived by the Judge. If counsel cannot settle the journal entry or order, then the attorney proposing it shall give notice to opposing counsel of the time of presentation of the journal entry or order for signature by the Judge." 4 Smith v. City of Stillwater, 2014 OK 42, ¶10, 328 P.3d 1192, 1197. 5 See, e.g., Indep. Sch. Dist. No. 52 of Okla. Cty. v. Hofmeister, 2020 OK 56, ¶ 17, n.17, 473 P.3d 475, 485 ("[T]this Court looks to the content and substance of a motion rather than its title to determine how the motion is treated, and a motion to reconsider may be treated as a motion for a new trial pursuant to 12 O.S. § 651."). 6 The motion is often labeled a term-time motion because: "Formerly the judgment could be vacated within the discretion of the court during the term at which it was rendered ... [and] [i]n 1969 the legislature replaced the term limitation with the thirty-day limitation in Section 1031.1." E. Dwight Morgan, Delayed Attacks on Final Judgments, 33 Okla. L. Rev. 45, n.2 (1980) (citing 12 O.S.1971 § 1031.1 and Whittett v. Payne, 1961 OK 247, 367 P.2d 718). 7 See, e.g., Chemco Products, Inc. v. Moley Produce Co., Inc., 1980 OK 122, 615 P.2d 300, 301 (an order granting a motion for new trial and an order which vacates a judgment are "functional equivalents" for the statutory classification of a right to appeal pursuant to 12 O.S.1971 § 952(b), which provides that "an order which (a) 'grants or refuses (to grant) a new trial' or (b) 'vacates or refuses to vacate a final judgment' is subject to review in this court."). 8 Myers v. Missouri Pacific Railroad Co., 2002 OK 60, ¶18, 52 P.3d 1014, 1022. 9 Schepp v. Hess, 1989 OK 28, n.2, 770 P.2d 34, 36. 10 See, e.g., Bank of Okla., N.A. v. Red Arrow Marina Sales & Serv., Inc., 2009 OK 77, ¶11, 224 P.3d 685, 693; (Rule 1.36 review of order adjudicating motion for new trial rested upon "the propriety of the earlier summary judgment, [and] we settle the abuse-of-discretion question by a de novo review of the summary adjudication's correctness."). 11 Neumann v. Arrowsmith, 2007 OK 10, ¶9, 164 P.3d 116, 119 (A District Court retains plenary control, or "term-time authority," pursuant to 12 O.S. § 1031.1 over terminal decisions for a limited time period of thirty days.). 12 A term-time motion to vacate (12 O.S. §1031.1) challenges "a judgment, decree or appealable order," and not an intermediate interlocutory ruling. LCR, Inc. v. Linwood Properties, 1996 OK 73, 918 P.2d 1388, 1393. 13 Okla. Sup. Ct. R. 1.20(b) ("The following constitute final orders: . . . (3) an order modifying or refusing to modify a judgment."). Compare with Okla. Sup. Ct. R.1.60 (list of interlocutory orders appealable by right and including "granting a new trial" and when a court "vacate[s] a judgment on any ground"). See also Lebus v. Carden, 1978 OK 91, 583 P.2d 503, 504 ("We hold that the order overruling the motion to vacate the prior order was one affecting a 'substantial right' under 58 O.S.1971, Sec. 721(8), and thus was an appealable order under that section and Rule 1.60(g) of the Rules of Appellate Procedure in Civil Cases."). 14 A final order is defined by 12 O.S.2021 § 953, and may be appealed pursuant to 12 O.S. 2021 § 952(b)(1). See, e.g., Neumann v. Arrowsmith, supra note 11 (trial court decision vacating judgment and granting a new trial to plaintiff pursuant to 12 O.S. § 1031.1 was affirmed on an appeal brought by defendants); Vann v. Union Cent. Life Ins. Co., 1920 OK 243, 191 P. 175, 177-76 (an order overruling a motion to vacate a judgment is a final order, because the order "finally disposes of the rights of the parties," and no further proceedings are necessary); Yery v. Yery, 1981 OK 46, 629 P.2d 357, 363 ("In an appeal from a [12 O.S. §1031] motion to vacate this Court does not look to the original judgment, but to the correctness of the court's response to the motion to vacate."). 15 Salyer v. National Trailer Convoy, Inc., 1986 OK 70, 727 P.2d 1361, 1363 (quoted language applied to review of an order adjudicating relief sought pursuant to 12 O.S. § 1031.1); Yery v. Yery, supra note 14. 16 State v. Torres, 2004 OK 12, ¶9, 87 P.3d 572, 579 ("The remedy to be pursued under these circumstances was for appellant to seek in the trial court postjudgment relief affordable by multiple statutory proceedings ... If appellant had met with an adverse ruling from the trial court, it could have appealed from that ruling and moved here to consolidate the two related appeals.") (material omitted). 17 Markwell v. Whinery's Real Estate, Inc., 1994 OK 24, 869 P.2d 840, 842 (Court explained an "assignment of error should designate the allegations of error clearly so that the court and opposing parties may ascertain the issues raised"). 18 First Nat. Bank & Trust Co. of Ada v. Arles, 1991 OK 78, 816 P.2d 537, 539. 19 Gray v. Holman, 1995 OK 118, n.11, 909 P.2d 776, 780 (citing Markwell v. Whinery's Real Estate, Inc., supra note 17, 869 P.2d at 843). 20 Okla. Sup. Ct. R. 1.36 (c)(B)(9) ( Record on Appeal, In appeals from final orders on motions to dismiss). 21 12 O.S.2021 §651 states in part: "A new trial is a reexamination in the same court, of an issue of fact or of law or both, after a verdict by a jury, the approval of the report of a referee, or a decision by the court." 22 See, e.g., Hardman v. Whitney, 1935 OK 1185, 52 P.2d 881, 882 ("A motion to vacate ... [is pursuant to a statute] empowering district courts to vacate or modify their judgments or orders, at or after the term in which such judgments or orders were made ... [and] an order denying a motion to vacate a judgment, under such circumstances, is an appealable order.") (material and citations omitted). 23 See, e.g., In re Estate of Dicksion, 2011 OK 96, n.1, 286 P.3d 283, 284 ("A journal entry disposing of a § 1031.1 motion is an appealable event.") (citing Kordis v. Kordis, 2001 OK 99, ¶ 6, 37 P.3d 866, 869). 24 Grisham v. City of Oklahoma City, 2017 OK 69, ¶19, 404 P.3d 843, 851 ("One example of the trap-for-the-unwary doctrine occurs when a poorly written statute or a not-so-clearly settled legal norm creates a veritable legal trap for the unwary."). 25 Rules of the Fourteenth Judicial District (Tulsa and Pawnee Counties), Rule CV 29, Journal Entries, Orders and Decrees, states in part: "Every journal entry, order, decree or other judgment presented to the Court for signature shall contain the approval as to form by the attorneys for each of the parties, unless waived by the Judge. If counsel cannot settle the journal entry or order, then the attorney proposing it shall give notice to opposing counsel of the time of presentation of the journal entry or order for signature by the Judge." 26 Capshaw v. Gulf Insurance Company, 2005 OK 5, ¶13, 107 P.3d 595, 602; Fitts v. Standard Life & Accident Ins. Co., 1974 OK 60, 522 P.2d 1040, 1043 (after enactment of 12 O.S. § 630 in 1951, a formal exception is not necessary, but a party must make known the ruling or order sought, or party's objection to the action of the court). 27 See, e.g., Beyrer v. The Mule, LLC, 2021 OK 45, ¶ 28, 496 P.3d 983, 993 (Diligence in preventing and correcting alleged trial error is required for certain claims used to obtain a new trial pursuant to 12 O.S. § 651.). 28 See, e.g., In re Adoption of M.J.S., 2007 OK 44, ¶30, 162 P.3d 211, 222 (because the best interests of the child is the determining factor for a child custody decision, trial court could not use a due diligence standard when adjudicating a motion for new trial based upon newly discovered evidence). 29 See, e.g., Housing Authority of Cherokee Nation of Oklahoma v. Langley, 1976 OK 142, 555 P.2d 1025, 1027 (While pursuant to 12 O.S. §611 a party may make a timely request on the record for findings of fact and conclusions of law when a matter is tried and determined on the merits by the court without a jury; unless required by statute, trial court's failure to make findings of fact and state conclusions of law when sustaining a demurrer or a motion to dismiss is not reversible error.). 30 In re Miller's Estate, 1938 OK 289, 78 P.2d 819, 823-24. See, e.g., Fitzgerald v. Caldwell, 1927 OK 234, 259 P. 209, 210 (party's previously filed request for findings of fact and conclusions of law was insufficient "unless the record affirmatively shows that such request was called to the attention of the trial judge at the trial of the cause before the final judgment was rendered and exception saved to his failure to comply with such request"). 31 Black, Sivalls & Bryson v. Farrell, 1928 OK 269, 268 P. 276, 277-78. 32 Coussens v. Gilmore, 1966 OK 12, 410 P.2d 879, 883. 33 12 O.S.2021(G) states in part: "On granting a motion to dismiss a claim for relief, the court shall grant leave to amend if the defect can be remedied and shall specify the time within which an amended pleading shall be filed." 34 Berkson's complaint was that: "Another unclear matter in both the First Order and Second Order was whether the dismissal was with or without prejudice . . . The Orders fail to state whether they are with or without prejudice." ROA, Exhibit 9, Plaintiffs' Motion to Reconsider or, In the Alternative, to Clarify Orders of Dismissal, pg. 68, July 22, 2022. 35 See, e.g., Fanning v. Brown, 2004 OK 7, ¶23, 85 P.3d 841, 848 ("In order for the courts to dismiss a claim for failure to state a cause of action without giving the plaintiff the opportunity to amend, it must appear that the claim does not exist rather than the claim has been defectively stated."). 36 Dani v. Miller, 2016 OK 35, ¶10, 374 P.3d 779, 785-86. 37 See, e.g., Nicholson v. Stitt, 2022 OK 35, ¶¶4-5, ¶14, 508 P.3d 442, 445, 448 (trial court's dismissal was reviewed de novo, decision denying an amendment was reviewed for an abuse of discretion, and the petition's allegations showed the futility of an amendment). 38 See, e.g., Christian v. Gray, 2003 OK 10, ¶ 43, 65 P.3d 591, 608 (application of the abuse-of-discretion standard requires a determination whether the trial court's discretion was based upon fact, law, or a mixed question of law and fact; and if the discretion was based upon an issue of law the trial court's decision is reviewed de novo on the alleged error of law). 39 See, e.g., Dani v. Miller, 2016 OK 35, ¶11, 374 P.3d 779, 786 (defendant moving for dismissal of a petition bears the burden of proof to show the legal insufficiency of the petition). 40 Okla. Stat. Ann. tit, 5, Ch. 1, App. 3-A, Rule 1.8 (West 2023) (Comment [10]). 41 ROA, Exhibit 4, State of Oklahoma's Motion to Dismiss, pg. 26, Jan. 24, 2022. 42 State ex rel. Okla. Corp. Comm. v. McPherson, 2010 OK 31, ¶25, 232 P.3d 458, 464-65. 43 Estate of Hicks v. Urban East, Inc., 2004 OK 36, ¶ 5, 92 P.3d 88, 90 ("The function of a motion to dismiss is to test the law of the claims, not the facts supporting them."). 44 Jackson v. Integra Inc., 952 F.2d 1260, 1261 (10th Cir. 1991) ("We review de novo a district court's ruling on a motion to dismiss for failure to state a claim upon which relief can be granted . . . Allegations in the plaintiff's complaint are presumed true.") (authority omitted). 45 Guzman v. Guzman, 2021 OK 6, ¶6, 507 P.3d 630, 632 ("When ruling on a motion to dismiss for lack of standing, the trial court and the appellate court must accept the petition's allegations and all inferences that can be drawn from them as true."). 46 Bowlin v. Alley, 1989 OK 66, ¶ 8, 773 P.2d 365, 367-68 (party possessed standing to challenge a statute providing for an award of attorney's fees to one prevailing party and not the opposing party). 47 See, e.g., Indep. Sch. Dist. No. 52 of Okla. Cty. v. Hofmeister, supra note 5, at ¶73, 473 P.3d at 505-06 (A party's standing is based, in part, upon an allegation of an injury in fact to a cognizable legal interest, and judicial relief sought by the party would be sufficient to remedy the injury.); Cities Serv. Co. v. Gulf Oil Corp., 1999 OK 16, ¶ 3, 976 P.2d 545, 547 (Standing, at a minimum, is based upon a legally protected interest injured in fact, a causal nexus between the injury and defendant's conduct, and a likelihood the injury will be redressed by a favorable decision.). 48 A Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction in a federal court generally takes one of two forms, a facial attack upon the sufficiency of allegations in the federal complaint and a challenge to jurisdiction based upon the actual facts. City of Albuquerque v. U.S. Dep't of Interior, 379 F.3d 901, 906 (10th Cir. 2004) (quoting Ruiz v. McDonnell, 299 F.3d 1173, 1180 (10th Cir. 2002) cert. denied, 538 U.S. 999, 123 S. Ct. 1908, 155 L. Ed. 2d 826 (2003)); cf. Osage Nat. v. Bd. of Cty. Comm'rs of Osage Cty., 2017 OK 34, ¶66, 394 P.3d 1224, 1245-1246 (a motion to dismiss on a jurisdictional issue may raise an issue of fact not present on the face of the petition). 49 Going beyond the face of a federal complaint to test its sufficiency may include: (1) documents that the complaint incorporates by reference, (2) documents referred to in the complaint if the documents are central to the plaintiff's claim and the parties do not dispute the documents' authenticity; and (3) matters of which a court may take judicial notice. Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S. Ct. 2499, 168 L. Ed. 2d 179 (2007); Oxendine v. Kaplan, 241 F.3d 1272, 1275 (10th Cir. 2001); Jacobsen v. Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002). 50 Bruce v. City and County of Denver, 57 F.4th 738, n.3, 741 (10th Cir. 2023) (quoting Tal v. Hogan, 453 F.3d 1244, 1264 n.24 (10th Cir. 2006)); see also Johnson v. Spencer, 950 F.3d 680, 705 (10th Cir. 2020);Von Saher v. Norton Simon Museum of Art at Pasadena, 592 F.3d 954, 960 (9th Cir. 2010); Premier Growth Fund v. Alliance Capital Mgmt., 435 F.3d 396, 401 n. 15 (3d Cir.2006)); Wittenberg v. Okla. Health Care Auth., 781 F. Supp. 2d 1221, 1227 (N.D.Okla. 2011) (quoting Tal v. Hogan, supra); cf. United Water and Sanitation Dist. v. Geo-Con, Inc., 488 F.Supp.3d 1052, 1057 (D.Colo. 2020) (judicial notice of adjudicative facts not subject to reasonable dispute could not apply to judicial notice of documents used to prove the truth of the matter asserted therein in relation to a motion to dismiss raising laches). 51 McIvor v. Credit Control Servs., Inc., 773 F.3d 909, 914 (8th Cir. 2014) ("Judicial notice of another court's opinion takes notice of the existence of the opinion, which is not subject to reasonable dispute over its authenticity, but not of the facts summarized in the opinion.") (quoting Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th Cir.2001) (on a Rule 12(b)(6) motion to dismiss the court may take judicial notice of another court's opinion, but "not for the truth of the facts recited therein, but for the existence of the opinion.") (quoting Southern Cross Overseas Agencies, Inc. v. Wah Kwong Shipping Group Ltd., 181 F.3d 410, 426--27 (3rd Cir.1999)); cf. United States v. Jones, 29 F.3d 1549, 1553--54 (11th Cir. 1994) ("If it were permissible for a court to take judicial notice of a fact merely because it has been found to be true in some other action, the doctrine of collateral estoppel would be superfluous ... [and] [m]oreover, to deprive a party of the right to go to the jury with his evidence where the fact was not indisputable would violate the constitutional guarantee of trial by jury."). 52 United States v. Wolny, 133 F.3d 758, 764 (10th Cir. 1998) (citing Fed. R. Evid. 201; Simon v. Taylor, 252 F.Supp.3d 1196, 1238 (D.N.M. 2017) (citing Fed. R. Evid. 201(b), (f); Leon v. Fedex Ground Package Sys., Inc., 163 F.Supp.3d 1050, 1066 (D.N.M. 2016)(Browning, J.))). 53 12 O.S. 2011 § 2202: A. This section governs only judicial notice of adjudicative facts. B. A judicially noticed adjudicative fact shall not be subject to reasonable dispute in that it is either: 1. Generally known within the territorial jurisdiction of the trial court; or 2. Capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. C. A court may take judicial notice, whether requested or not. D. A court shall take judicial notice if requested by a party and supplied with the necessary information. E. In a civil action or proceeding, the court shall instruct the jury to accept as conclusive any fact judicially noticed. In a criminal case, the court shall instruct the jury that it may, but is not required to, accept as conclusive any fact judicially noticed. 54 See, e.g., Boyle v. ASAP Energy, Inc., 2017 OK 82, ¶30, 408 P.3d 183, 193-194 (Objective facts must be produced by plaintiff for his or her cause of action, the factum probans (the fact which is stated), must be presented to the finder of fact to prove the factum probandum (the factual proposition to be proved) required as part of plaintiff's cause of action.). 55 United States v. Aluminum Co. of America, 148 F.2d 416, 445-46 (2d Cir.1945) (L. Hand, J.) (Judicial notice was taken of the report of the Truman Committee but calculations of aluminum production in the report "would not be conclusive, or more than evidence ... [and] facts which a court may judicially 'notice' do not for that reason become indisputable."). 56 Powers v. Dist. Ct. of Tulsa County, 2009 OK 91, ¶6, 227 P.3d 1060, 1066-1067 (an evidentiary hearing is held to resolve factual disputes relating to jurisdiction); cf. Paper, Allied-Indus., Chem. and Energy Workers Int'l Union v. Cont'l Carbon Co., 428 F.3d 1285, 1292 (10th Cir. 2005) (citing Wheeler v. Hurdman, 825 F.2d 257, 259 n. 5 (10th Cir.1987)) (When a party's attack upon jurisdiction goes beyond the face of the pleading, the federal court has wide discretion to allow documentary and even testimonial evidence.). 57 Payne v. Kerns, 2020 OK 31, ¶10, 467 P.3d 659, 664. 58 Hamid v. Sew Original, 1982 OK 46, 645 P.2d 496, 497. 59 Young v. Station 27, Inc., 2017 OK 68, n. 5, 404 P.3d 829; see also Crest Infiniti, II, LP v. Swinton, 2007 OK 77, ¶ 10, 174 P.3d 996, 1002 (unsworn statements by counsel in both a motion and a response by opposing counsel do not constitute evidence). 60 We need not address procedural and substantive issues involving when a party's legal standing may intersect with various defenses in 12 O.S.2021 § 2012. 61 Fischencord v. Peterson, 1935 OK 746, 49 P.2d 128, 132 (explanation and emphasis added) (court stated demurrers were correctly sustained on the ground of misjoinder of causes of action the appellate court concluded it was unnecessary to determine whether a defendant's demurrer based upon res adjudicata was a sufficient pleading); see also Leahy v. Indian Territory Illuminating Oil Co., 1913 OK 559, 135 P. 416 ("On appeal by a plaintiff from an order, which sustained a demurrer to the petition on one of several grounds, this court will consider all the grounds assigned, and the order will be sustained if any of such grounds are well taken.") (Syllabus by the Court). 62 Smith v. Westinghouse Elec. Corp., 1987 OK 3, n.3, 732 P.2d 466, 467. 63 Dutton v. City of Midwest City, 2015 OK 51, ¶31, n.65, 353 P.3d 532, 547 (citing Naylor v. Petuskey, 1992 OK 88, 834 P.2d 439, 440, and stating application of a jury fee prescribed by 28 O.S. § 152.1 was a publici juris issue); Barzellone v. Presley, 2005 OK 86, n.16, 126 P.3d 588, ("the issue of jury fee collections is a matter of publici juris, warranting consideration by this Court"). 64 Wells v. Okla. Roofing & Sheet Metal, L.L.C., 2019 OK 45, ¶7, 457 P.3d 1020, 1024. 65 Farley v. City of Claremore, 2020 OK 30, ¶10, 465 P.3d 1213, 1221. 66 ROA, Exhibit 5, Plaintiffs' Combined Response to Defendants' Motions to Dismiss, p.49, Feb. 14, 2022. 67 EOG Res. Mktg., Inc. v. Okla. State Bd. of Equalization, 2008 OK 95, 196 P.3d 511 (68 O.S.2001 § 2851.3 was an unconstitutional special law in violation of the Okla. Const. Art. 5, § 46); Zeier v. Zimmer, 2006 OK 98, 152 P.3d 861 (63 O.S. Supp.2003 § 1--1708.1E violates Okla. Const. Art. 5, § 46); Reynolds v. Porter, 1988 OK 88, 760 P.2d 816 (76 O.S.1981 § 18 violated Okla. Const. Art. 5, § 46). 68 Benedetti v. Cimarex Energy Co., 2018 OK 21, 415 P.3d 43 (85 O.S. 2011 § 302(H) violated Okla. Const. Art. 5, § 59). 69 If we deemed Berkson's motion to reconsider as a functional equivalent to a motion for new trial, then no additional information would be revealed because the motion is silent on a prohibited special law. 70 Okla. Const. Art. 5 § 59: "Laws of a general nature shall have a uniform operation throughout the State, and where a general law can be made applicable, no special law shall be enacted." 71 Zeir v. Zimmer, 2006 OK 98 at ¶11, 152 P.3d at 866 ("The Reynolds Court attempted to eliminate the confusion between a constitutional attack brought under art. 5, § 46, containing specific legislative prohibitions, and art. 5, § 59, allowing the Legislature to pass special laws when no general law is applicable.") (note omitted). 72 Braitsch v. City of Tulsa, 2018 OK 100, ¶9, 436 P.3d 14, 20. 73 Glasco v. State ex rel. Okla. Dep't of Corr., 2008 OK 65, ¶20, 188 P.3d 177, 184. 74 ROA, Exhibit 1, Petition for Declaratory, Injunctive and Monetary Relief, p.4, Dec. 29, 2021. 75 Id. 76 ROA, Exhibit 1, Petition for Declaratory, Injunctive and Monetary Relief, p.5, Dec. 29, 2021. 77 ROA, Exhibit 5, Plaintiffs' Combined Response to Defendants' Motions to Dismiss, p.48, Feb. 14, 2022. 78 ROA, Exhibit 1, Petition for Declaratory, Injunctive and Monetary Relief, pgs. 6-7, Dec. 29, 2021; ROA, Exhibit 5, Plaintiffs' Combined Response to Defendants' Motions to Dismiss, pgs.48-9, Feb. 14, 2022. 79 ROA, Exhibit 5, Plaintiffs' Combined Response to Defendants' Motions to Dismiss, pgs.48, Feb. 14, 2022 (explanation and emphasis added). 80 Berkson cites as an example Fent v. State ex rel. Dep't of Human Services, 2010 OK 2, 236 P.3d 61 to illustrate his point concerning a pro se attorney. ROA, Exhibit 5, Plaintiffs' Combined Response to Defendants' Motions to Dismiss, pg. 48, n.3, Feb. 14, 2022. Fent was a controversy exercising this Court's original jurisdiction to issue declaratory relief, and a jury trial is not part of this Court's exercise of original supervisory jurisdiction. State ex rel. Brett, Cty. Atty. v. Kenner, 1908 OK 156, 97 P. 258, 260. 81 Kitchen v. Herbert, 755 F.3d 1193, 1222-23 (10th Cir. 2014) (quoting Turner Broad. Sys., Inc. v. FCC, 520 U.S. 180, 117 S. Ct. 1174, 137 L. Ed. 2d 369 (1997) and Turner Broad. Sys., Inc. v. FCC, 512 U.S. 622, 662, 114 S. Ct. 2445, 129 L. Ed. 2d 497 (1994) (plurality opinion). 82 Kitchen v. Herbert, 755 F.3d at 1223 (quoting Heller v. Doe ex rel. Doe, 509 U.S. 312, 113 S. Ct. 2637, 125 L. Ed. 2d 257 (1993) 83 Ross v. Peters, 1993 OK 8, 846 P.2d 1107, 1115-16. 84 Beason v. I. E. Miller Services, Inc., 2019 OK 28, n.2, 441 P.3d 1107, 1111 (citing Reynolds v. Porter, 1988 OK 88, ¶ 21, 760 P.2d 816, 824). 85 Glasco v. State ex rel. Okla. Dep't of Corr., 2008 OK 65, ¶27, 188 P.3d 177, 186. 86 Beason v. I. E. Miller Services, Inc., 2019 OK 28, ¶6, 441 P.3d 1107, 1111 (quoting Ponca Iron & Metal, 2010 OK 75, ¶ 6, 242 P.3d 534, 536). 87 See, e.g., Weaver v. Laub, 1977 OK 242, 574 P.2d 609 (if the dangers in awarding pro se lawyer's attorney's fees can be minimized, the fees should be awarded, and the fees were allowed in a partition proceeding); Kay v. Ehrler, 499 U.S. 432, 437-386, 111 S. Ct. 1435,113 L. Ed. 2d 486 (1991) (When discussing an attorney's fee award pursuant to 42 U.S.C. § 1988, the Court opined it is better when a plaintiff does not consider himself or herself to be competent to litigate on his or her own behalf; and the Court noted the adage that "'a lawyer who represents himself has a fool for a client' is the product of years of experience by seasoned litigators.'"). 88 Southon v. Okla. Tire Recyclers, LLC, 2019 OK 37, ¶11, 443 P.3d 566, 571. 89 Fanning v. Brown, 2004 OK 7, ¶4, 85 P.3d 841, 844.

08319052-7c77-4ba9-8033-25dc8e94041d

Oklahoma Call for Reproductive Justice v. Oklahoma

oklahoma

Oklahoma Supreme Court

OKLAHOMA CALL FOR REPRODUCTIVE JUSTICE v. STATE OF OKLAHOMA2023 OK 60Case Number: 120376Decided: 05/31/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. OKLAHOMA CALL FOR REPRODUCTIVE JUSTICE, on behalf of itself and its members, TULSA WOMEN'S REPRODUCTIVE CLINIC, LLC, on behalf of itself, its physicians, its staff, and its patients, ALAN BRAID, M.D., on behalf of himself and his patients, COMPREHENSIVE HEALTH OF PLANNED PARENTHOOD GREAT PLAINS, INC., on behalf of itself, its physicians, its staff, and its patients and PLANED PARENTHOOD OF ARKANSAS & EASTERN OKLAHOMA, on behalf of itself, its physicians, its staff and its patients, Petitioners,v.THE STATE OF OKLAHOMA, NICHOLE COOPER in her official capacity as court clerk of Adair County; TAMMI MILLER in her official capacity as court clerk of Alfalfa County; ANGELA NUTTALL in her official capacity as court clerk of Atoka County; TAMMIE PATZKOWSKY in her official capacity as court clerk of Beaver County; DONNA HOWELL in her official capacity as court clerk of Beckham County; CHRISTY MALTI in her official capacity as court clerk of Blaine County; DONNA ALEXANER in her official capacity as court clerk of Bryan County; PATTI BARGER in her official capacity as court clerk of Caddo County; MARIE HIRST in her official capacity as court clerk of Canadian County; RENEE BRYANT in her official capacity as court clerk of Carter County; LESA ROUSEY-DANIELS in her official capacity as court clerk of Cherokee County; LAURA SUMNER in her official capacity as court clerk of Choctaw County; METZI BROWN in her official capacity as court clerk of Cimarron County; MARILYN WILLIAMS in her official capacity as court clerk of Cleveland County; LaDONNA FLOWERS in her official capacity as court clerk of Coal County; ROBERT MORALES in his official capacity as court clerk of Comanche County; TERRY KELLEY in her official capacity as court clerk of Cotton County; DEBORAH MASON in her official capacity as court clerk of Craig County; AMANDA VANORSDOL in her official capacity as court clerk of Creek County; STACI HUNTER in her official capacity as court clerk of Custer County; CAROLINE WEAVER in her official capacity as court clerk of Delaware County; RACHELLE ROGERS in her official capacity as court clerk of Dewey County; SALLY WAYLAND in her official capacity as court clerk of Ellis County; JANELLE SHARP in her official capacity as court clerk of Garfield County; LAURA LEE in her official capacity as court clerk of Garvin County; LISA HANNAH in her official capacity as court clerk of Grady County; DEANA KILLIAN in her official capacity as court clerk of Grant County; JEANNA SCOTT in her official capacity as court clerk of Greer County; STACY MACIAS in her official capacity as court clerk of Harmon County; SUSAN BREON in her official capacity as court clerk of Harper County; TINA OKAS in her official capacity as court clerk of Haskell County; ASHLEY SANFORD in her official capacity as court clerk of Hughes County; TINA SWAILES in her official capacity as court clerk of Jackson County; KIMBERLY BERRY in her official capacity as court clerk of Jefferson County; CASSANDRA SLOVER in her official capacity as court clerk of Johnston County; MARILEE THONRTON in her official capacity as court clerk of Kay County; LISA MARKUS in her official capacity as court clerk of Kingfisher County; KAY RICHARDS in her official capacity as court clerk of Kiowa County; MELINDA BRINLEE in her official capacity as court clerk of Latimer County; MELBA HALL in her official capacity as court clerk of Le Flore County; CINDY KIRBY in her official capacity as court clerk of Lincoln County; CHERYL SMITH in her official capacity as court clerk of Logan County; WENDY HOLLAND in her official capacity as court clerk of Love County; SHAUNA HOFFMAN in her official capacity as court clerk of Major County; WANDA PIERCE in her official capacity as court clerk of Marshall County; JENIFER CLINTON in her official capacity as court clerk of Mayes County; KRISTEL GRAY in her official capacity as court clerk of McClain County; KATHY GRAY in her official capacity as court clerk of McCurtain County; LISA RODEBUSH in her official capacity as court clerk of McIntosh County; JODI JENNINGS in her official capacity as court clerk of Murray County; ROBYN BOSWELL in her official capacity as court clerk of Muskogee County; HILLARY VORNDRAN in her official capacity as court clerk of Noble County; APRIL FRAUENBERGER in her official capacity as court clerk of Nowata County; SHERRI FOREMAN in her official capacity as court clerk of Okfuskee County; RICK WARREN in his official capacity as court clerk of Oklahoma County; CHARLY CRINER in her official capacity as court clerk of Okmulgee County; JENNIFER BURD in her official capacity as court clerk of Osage County; CASSIE KEY in her official capacity as court clerk of Ottawa County; ILA POTTS in her official capacity as court clerk of Pawnee County; LORI ALLEN in her official capacity as court clerk of Payne County; PAM SMITH in her official capacity as court clerk of Pittsburg County; KAREN DUNNIGAN in her official capacity as court clerk of Ponotoc County; VALIER UELTZEN in her official capacity as court clerk of Pottawatomie County; TINA FREEMAN in her official capacity as court clerk of Pushmataha County; JAN BAILEY in her official capacity as court clerk of Roger Mills County; CATHI EDWARDS in her official capacity as court clerk of Rogers County; KIMBERLY DAVIS in her official capacity as court clerk of Seminole County; GINA COX in her official capacity as court clerk of Sequoyah County; MELODY HARPER in her official capacity as court clerk of Stephens County; M. RENEE ELLIS in her official capacity as court clerk of Texas County; KEVIN STEVENS in his official capacity as court clerk of Tillman County; DON NEWBERRY in his official capacity as court clerk of Tulsa County; JIM HIGHT in his official capacity as court clerk of Wagoner County; JILL SPITZER in her official capacity as court clerk of Washington County; LYNDA VERMILLION in her official capacity as court clerk of Washita County; STACI DAVEY in her official capacity as court clerk of Woods County; and TAMMY ROBERTS in her official capacity as court clerk of Woodward County, Respondents. APPLICATION TO ASSUME ORIGINAL JURISDICTION FOR DECLARATORY AND INJUNCTIVE RELIEF AND/OR A WRIT OF PROHIBITION ¶0 The Petitioners filed an application to assume original jurisdiction seeking declaratory relief and to enjoin enforcement of two laws which criminalize abortion. We assume original jurisdiction, grant declaratory relief and deny injunctive relief and writ of prohibition. ORIGINAL JURISDICTION ASSUMED; DECLARATORY RELIEF GRANTED; INJUNCTIVE RELIEF AND WRIT OF PROHIBITION DENIED. J. Blake Johnson, Overman Legal Group, PLLC, Oklahoma City, Oklahoma for Petitioners Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, LLC, Alan Braid, M.D., Comprehensive Health of Planned Parenthood Great Plains, Inc. and Planned Parenthood of Arkansas & Eastern Oklahoma. Catherine (Cici) Coquillette, Meetra Mehdizadeh, and Rabia Muqaddam, Center for Reproductive Rights, New York, New York for Petitioners Oklahoma Call for Reproductive Justice, Tulsa Women's Reproductive Clinic, LLC, and Alan Braid, M.D. Sarah Mac Dougall and Jennifer Sandman, Planned Parenthood Federation of America, New York, New York for Petitioners Comprehensive Health of Planned Parenthood Great Plains, Inc. and Planned Parenthood of Arkansas & Eastern Oklahoma. Zach West, Acting Solicitor General, and Audrey A. Weaver, Assistant Solicitor General, Office of Attorney General, Oklahoma City, Oklahoma for Attorney General of Oklahoma, Gentner Drummond, pursuant to 74 O.S. § 18b(A)(3). Mike Shouse, Tulsa County District Attorney's Office, Tulsa, Oklahoma for Respondent Don Newberry, in his official capacity as Tulsa County Court Clerk. Charles L. Sifers, Assistant District Attorney, Sixth Prosecutorial District, Chickasha, Oklahoma for Respondents Lisa Hannah, Melody Harper, Patti Barger, and Kimberly Berry in their respective roles as Court Clerks of Grady, Stephens, Caddo, and Jefferson Counties. S. Corey Stone, Assistant District Attorney, Office of the District Attorney, District 23, Shawnee, Oklahoma for Respondent Valerie Ueltzen, in her official capacity as Court Clerk of Pottawotomie County. Melissa G. Handke, First Assistant District Attorney, Twentieth Judicial District, Carter County District Attorney's Office, Ardmore, Oklahoma for Respondents Renee Bryant, Casandra Slover, Wendy Holland, Wanda Pierce, and Jodi Jennings in their respective roles as Court Clerks of Carter, Johnston, Love, Marshall, and Murray County. Candice M. Irby, Assistant District Attorney, Wewoka, Oklahoma for Respondent Kimberly Davis in her official capacity as Seminole County Court Clerk. Nicholas E. Thurman, Assistant District Attorney, Ada, Oklahoma for Respondent, the State of Oklahoma. Matthew J. Primm, Assistant District Attorney, District 12, Pryor, Oklahoma for Respondent Jennifer Clinton in her official capacity as court clerk of Mayes County. Angela Marsee, Assistant District Attorney, District 2, Arapaho, Oklahoma for Respondents Donna Howell, Staci Hunter, Sally Wayland, Jan Bailey, and Lynda Vermillion in their respective official capacities as court clerks of Beckham, Custer, Ellis, Roger Mills, and Washita County. Kyle Cabelka, District Attorney, Lawton, Oklahoma for Respondents Robert Morales and Terry Kelley in their respective official capacities as court clerks of Comanche and Cotton County. Tommy Humphries, Office of the District Attorney, El Reno, Oklahoma for Respondents Marie Hirst, Janelle Sharp, Christi Matli, Lisa Markus, and Deana Kilian in their respective official capacities as court clerks of Canadian, Garfield, Blaine, Kingfisher, and Grant County. Brian T. Hermanson, Office of the District Attorney, Newkirk, Oklahoma for Respondents Marilee Thornton and Hillary Vorndran in their respective official capacities as court clerks of Kay and Noble County. David R. Thomas, District Attorney, Altus, Oklahoma for Respondents Tina Swailes, Jeana Scott, Kay Richards, Stacy Macias, and Kevin Stephens in their respective official capacities as court clerks of Jackson, Greer, Kiowa, Harmon, and Tillman County. Charles B. "Chuck" Sullivan, District Attorney, District 18, McAlester, Oklahoma for Respondents Pamela Smith and Tina Oaks in their respective official capacities as court clerks of Pittsburg and Haskell County. Todd M. Wagner, Assistant District Attorney, Claremore, Oklahoma for Respondents Cathy Edwards and Deborah Mason in their official respective capacities as court clerks of Rogers and Craig County. James E. Tillison, Assistant District Attorney, Holdenville, Oklahoma for Respondent Ashley Sanford in her official capacity as Hughes County Court Clerk. PER CURIAM: ¶1 Petitioners filed this original proceeding objecting to two pieces of legislation passed by the Oklahoma legislature during the 2022 legislative session: S.B. 1503 and H.B. 4327. Both acts prohibit abortion after certain cutoff points while providing for a civil enforcement mechanism; both acts prohibit enforcement by the State, its subdivisions, and its agents--instead, the bills create a cause-of-action maintainable by any person for performing, or aiding and abetting the performance of, an abortion in violation of the acts. Petitioners challenge the bills on many grounds, but we do not address them all today. First and foremost, Petitioners' challenged the constitutionality of the acts prohibiting abortion in violation of the Oklahoma Constitution. ¶2 S.B. 1503 prohibits abortions after detection of a fetal heartbeat except in case of medical emergency. S.B. 1503 states in relevant part: "Sections 3 and 4 of this act shall not apply if a physician believes a medical emergency exists that prevents compliance of this act." S.B. 1503, § 5(A). There is no definition of medical emergency. There is also no severability clause. ¶3 H.B. 4327 on the other hand is a total ban on all abortions unless the "abortion is necessary to save the life of a pregnant woman in a medical emergency" or the "pregnancy is the result of rape, sexual assault, or incest that has been reported to law enforcement." H.B. 4327, § 2. H.B. 4327 states that "'Medical emergency' means a condition in which an abortion is necessary to preserve the life of a pregnant woman whose life is endangered by a physical disorder, physical illness, or physical injury, including a life-endangering physical condition caused by or arising from the pregnancy itself." H.B. 4327, § 1(3). ¶4 Pursuant to this Court's decision in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, ¶ 9, -- P.3d --, finding an "inherent right of a pregnant woman to terminate a pregnancy when necessary to preserve her life," we find these two statutes to also be unconstitutional. S.B.1503 provides even more extreme language then Section 1-731.4, found unconstitutional in Oklahoma Call for Reproductive Justice v. Drummond, as such, under stare decisis this Court must also find S.B. 1503 unconstitutional. See 2023 OK 24, ¶ 12. ¶5 H.B. 4327 uses identical language as the statute in question in Oklahoma Call for Reproductive Justice v. Drummond, as such, pursuant to stare decisis this Court must also find it unconstitutional. See 2023 OK 24, ¶ 12. But unlike the statutes in question in Oklahoma Call for Reproductive Justice v. Drummond, H.B. 4327 contains a lengthy severability clause. ¶6 This Court has previously explained how analysis of severability issues should be performed: Severability analysis is a necessary process when some, but not all, provisions of an enactment are to be condemned as unconstitutional and hence void. Its purpose is to determine whether non-offending statutory provisions may survive as valid after the clauses rejected as invalid are separated from the whole. The severability of a statutory enactment is not contingent on the presence of an express severability clause within the particular enactment's text. Survival of untainted statutory provisions that remain is appropriate when the valid and voided (as unconstitutional) provisions are not so "inseparably connected with and so dependent upon" each other that the surviving provisions would not have otherwise been enacted. Consideration must be given to whether the surviving provisions must rely on the severed portion for meaning or enforcement. Fent v. Contingency Review Brd., 2007 OK 27, ¶ 18, 163 P.3d 512, 523--24 (footnotes omitted). In this case, if the Court were to sever the language allowing for medical abortions only in case of a medical emergency in H.B. 4327, the Court would create an even more restrictive statute like S.B. 1503, which was in further violation of the Oklahoma Constitution. If the Court were to sever the prohibition on abortion altogether, there would be no meaning to the rest of the bill because there would be nothing to civilly enforce. In order to attempt to salvage the rest of H.B. 4327, this Court would have to re-write the entire statute, which is not our purview. ¶7 Because we hold both bills are unconstitutional under the Oklahoma Constitution, pursuant to this Court's analysis in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, we need not reach the rest of the Petitioner's challenges to the legislation. We grant Petitioner declaratory relief as to both S.B. 1503 and H.B. 4327. See Fent v. Contingency Review Brd., 2007 OK 27, ¶¶ 10--11, 163 P.3d at 520--21; see also Okla. Call for Reproductive Justice v. Drummond, 2023 OK 24, ¶ 16. Having found both S.B. 1503 and H.B. 4327 are unconstitutional and therefore unenforceable, it is unnecessary to address the Petitioners' request for injunctive relief and/or writ of prohibition or Respondents' claims that Petitioners do not have a justiciable claim against them. Petitioners' request for injunctive relief and/or a writ of prohibition is denied. See Hunsucker v. Fallin, 2017 OK 100, ¶37, 408 P.3d 599, 612. ORIGINAL JURISDICTION ASSUMED; DECLARATORY RELIEFGRANTED; INJUNCTIVE RELIEF AND WRIT OF PROHIBITION DENIED. KAUGER, WINCHESTER, EDMONDSON, COMBS, GURICH and DARBY (by separate writing), JJ., CONCUR; DARBY, J., concurring specially: "If the Court was starting on square one on this subject, I would dissent. But this issue is determined by stare decisis. I maintain my position that I expressed in my dissent in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, ___ P.3d ___." KANE, C.J. (by separate writing), ROWE, V.C.J. (by separate writing) and KUEHN, J. (by separate writing), DISSENT. KANE, C.J., with whom Kuehn, J. joins, DISSENTING: ¶1 Were I to conclude that this case is exclusively resolved by the doctrine of stare decisis, I would dissent for the reasons given in my dissent in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, __ P.3d __ ("OCRJ 1"). However, while this case and OCRJ 1 both deal with abortion, they present different legal and factual issues. I do not believe that application of OCRJ 1 fully resolves the current dispute. ¶2 Merely applying stare decisis in this case could be interpreted as amplifying and expanding the reach of OCRJ 1, which I continue to assert was wrongly decided. I dissent. ROWE, V.C.J., dissenting: ¶1 I dissent to the Court's finding that S.B. 1503 is unconstitutional in light of our holding in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, ("OCRJ I"). Specifically, there is an important difference between the language employed in S.B. 1503 and that used in 63 O.S.Supp.2022 § 1-731.4, which we found unconstitutional in OCRJ I. ¶2 In OCRJ I, we held that under the Oklahoma Constitution, [A] woman has an inherent right to choose to terminate her pregnancy if at any point in the pregnancy, the woman's physician has determined to reasonable degree of medical certainty or probability that the continuation of the pregnancy will endanger the woman's life due to the pregnancy itself or due to a medical condition that the woman is either currently suffering from or likely to suffer from during the pregnancy." OCRJ I, 2023 OK 24, ¶ 9. ¶3 The petitioners in OCRJ I were challenging the constitutionality of two statutes, including § 1-731.4. Section 1-731.4 criminalized the performance of an abortion except when done "to save the life of a pregnant woman in a medical emergency." The statute defined "medical emergency" as a "condition which cannot be remedied by delivery of the child in which an abortion is necessary to preserve the life of a pregnant woman whose life is endangered by a physical disorder, physical illness or physical injury including a life-endangering physical condition caused by or arising from the pregnancy itself." 63 O.S.Supp.2022 § 1-731.4(A)(2). We held that the narrow scope of this exception infringed on a woman's right to terminate her pregnancy to preserve her life: We read this section of law to require a woman to be in actual and present danger in order for her to obtain a medically necessary abortion. We know of no other law that requires one to wait until there is an actual medical emergency in order to receive treatment when the harmful condition is known or probable to occur in the future. Requiring one to wait until there is a medical emergency would further endanger the life of the pregnant woman and does not serve a compelling state interest. OCRJ I, 2023 OK 24, ¶ 12. ¶4 Section 1-731.4 did not allow for a physician to determine whether a medical emergency existed. Rather, physicians were bound by the statutory definition of a medical emergency. Unlike § 1-731.4, S.B. 1503 does not explicitly define the term "medical emergency," instead placing the decision of what constitutes a medical emergency within the sole discretion of the treating physician. S.B. 1503 states: "Sections 3 and 4 of this act shall not apply if a physician believes a medical emergency exists that prevents compliance with this act." Had this qualifying language, granting physicians sole discretion to determine what constitutes a medical emergency, been included in § 1-731.4, it likely would have alleviated the majority's concern with the constitutionality of that statute. ¶5 Here, we have: (1) a ban on elective abortion, which the majority upheld in OCRJ I;1 and (2) an exception that the majority endorsed in OCRJ I--that a woman may terminate her pregnancy if her physician determines there is a medical emergency.2 In combination, these provisions completely comport with our currently settled precedent. Accordingly, stare decisis leads to a finding of constitutionality--not unconstitutionality--as the majority finds. ¶6 I cannot ascribe to the majority's finding that S.B. 1503 imposes on a woman's constitutional right to terminate her pregnancy in order to preserve her life. Moreover, in finding that S.B. 1503 violates that right, I am concerned that the majority has expanded that right beyond what the Court recognized in OCRJ I. ¶7 I am also troubled by the majority's finding that S.B. 1503 has "even more extreme language than Section 1-731.4." In OCRJ I, we did not find that § 1-731.4 contained "extreme language." Thus, the majority's characterization of S.B. 1503 as "even more extreme" seems misplaced. Additionally, if by "more extreme" the majority means more restrictive on abortion, I find the majority's assessment difficult to reconcile, given that S.B. 1503 gives physicians the discretion to determine if a medical emergency exists, whereas in § 1-731.4 the existence of a medical emergency was dictated by statute. Furthermore, as this Court has previously upheld legislative bans on elective abortions, I find the majority's labeling of this legislation as "extreme" to be unsettling. ¶8 Finally, with respect to H.B. 4327, I dissent to the majority's finding that the act is unconstitutional for the same reasons set out in my dissent in OCRJ I. The issues presented in this matter are political questions, which are better resolved by the people via our democratic process. FOOTNOTES 1 Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, ¶ 1 (Kauger, J. concurring) ("I fully concur in the majority opinion which finds 21 O.S. 2021 §861 [banning abortion except when necessary to preserve the life of the mother] constitutional."). 2 Notably, the right to an abortion that we crafted in OCRJ I was predicated on a physician's determination that "the pregnancy will endanger the woman's life." See id. ¶ 9. KUEHN, J., DISSENTING: ¶1 I dissent for the reasons given in my dissent in Oklahoma Call for Reproductive Justice v. Drummond, 2023 OK 24, __ P.3d __.

d7fd3f78-f6b3-41df-bc9a-53e36630c4eb

Guilbeau v. Durant, HMA

oklahoma

Oklahoma Supreme Court

GUILBEAU v. DURANT H.M.A.2023 OK 80Case Number: 119901Decided: 06/20/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CRYSTAL GUILBEAU, Plaintiff/Appellant, v. DURANT H.M.A., LLC, d/b/a MEDICAL CENTER OF SOUTHEASTERN OKLAHOMA, a/k/a ALLIANCEHEALTH DURANT, and LAUREN ARMOR, Defendants/Appellees. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III ¶0 After Appellant suffered a miscarriage, Hospital employees photographed the child's remains and presented the images to her as part of Hospital's bereavement program. Appellant sued Hospital and unnamed employees on theories of negligence and intentional infliction of emotional distress (IIED). The trial court dismissed the negligence claims. Appellant later dismissed the remaining IIED claim without prejudice, and without appealing the trial court's dismissal of her negligence claims. In a subsequent lawsuit, Appellant re-alleged all of her original claims, added a new claim of invasion of privacy, and added Armor, a Hospital employee, as a defendant. The trial court granted Defendants' partial motions to dismiss. The Court of Civil Appeals affirmed, finding that (1) Appellant was precluded from re-asserting her negligence claims in the second lawsuit, because she never sought review of the trial court's dismissal of those claims in the first lawsuit; (2) Appellant's addition of an invasion-of-privacy claim in the second lawsuit was not time-barred; however, (3) the invasion-of-privacy claim was properly dismissed because Appellant had no personal cause of action on these facts; and finally, (4) the addition of Armor as a defendant in the second lawsuit was barred by the statute of limitations. COURT OF CIVIL APPEALS' OPINION VACATED; TRIAL COURT AFFIRMED IN PART AND REVERSED IN PART; CASE REMANDED FOR FURTHER PROCEEDINGS Donald E. Smolen II, Tulsa, Oklahoma, for Plaintiff/Appellant. John David Lackey, Tulsa, Oklahoma, for Defendants/Appellees. KUEHN, J. ¶1 In this case we are asked to determine matters of civil procedure, as well as the contours of the substantive right to privacy under Oklahoma law. We find the Court of Civil Appeals correctly decided the procedural claims, but erred in concluding that, as a matter of law, no claim for invasion of privacy could lie on the available facts. FACTS AND PROCEDURAL HISTORY ¶2 In the summer of 2016, Plaintiff/Appellant Crystal Guilbeau, several months pregnant, presented to Defendant Durant HMA (Hospital) complaining of abdominal pain. She ultimately experienced a miscarriage there. A few days after her release, Guilbeau was asked to return to Hospital, where she was presented with photographs of her deceased child. Guilbeau did not view the photos until she returned home. Guilbeau claims the photographs show the child's body in various poses and with props (e.g. angel wings). The child's limbs and mouth had allegedly been manipulated, for the apparent purpose (in the words of the petition) of making the child "look alive and well." In September 2016, Guilbeau sued Hospital and unknown employees who participated in creating the photos. She claims -- and no one can deny -- that the miscarriage itself was a traumatic experience for her. She also claims the photos were shocking to her and only compounded her trauma. The parties dispute whether Guilbeau consented to the taking of these photos, described in the pleadings as the product of Hospital's "bereavement program." ¶3 Guilbeau's first lawsuit, against Hospital and two "Jane Doe" defendants, alleged claims of intentional infliction of emotional distress (IIED) and negligence.1 Specifically, Guilbeau claimed that unnamed Hospital employees, acting within the scope of their employment, intentionally or negligently caused her "mental, emotional, and physical pain and suffering," and that Hospital also breached its duty to responsibly "hire, train, and supervise" these employees. Guilbeau's petition sought actual and punitive damages. In November 2016, the trial court granted Hospital's motion to dismiss the negligence claims. In October 2018, Hospital moved for summary judgment on the IIED claim, which the trial court denied. ¶4 In August 2019, Guilbeau filed a document entitled "Notice of Claims." Guilbeau was apparently confused about whether the trial court's dismissal of her negligence claim in 2016 applied only to her claim of simple negligence, or included her allegation of negligent hiring, training, and supervision. While she described these as "separate and distinct legal theories of liability," she made both allegations under a single heading of "Negligence" in her petition.2 In September 2019, the trial court ruled that the only surviving claim was the IIED claim -- clarifying that its dismissal included both negligence theories. The trial court granted Guilbeau's request to certify that ruling for interlocutory review -- i.e., it allowed her to seek appellate review of its dismissals of the negligence claims before final resolution of the rest of the case. See 12 O.S. § 952(b)(3). However, Guilbeau did not seek interlocutory review. Instead, in March 2020, she chose to dismiss the sole surviving IIED claim "without prejudice," reserving the option to refile her lawsuit at a later date, consistent with 12 O.S. § 683. ¶5 In December 2020, Guilbeau filed her second lawsuit.3 This new petition (1) re-alleged a claim for IIED; (2) re-alleged a single negligence claim that (again) referenced both general negligence as well as a "duty to train and supervise" under one heading; (3) alleged an entirely new claim of "Invasion of Privacy -- Intrusion Upon Seclusion"; and (4) for the first time, named Armor as Hospital's only co-defendant. This petition again sought both actual and punitive damages. Both Defendants filed motions to dismiss, claiming (1) Guilbeau's re-assertion of her negligence claims was barred by the doctrine of claim preclusion; (2) Guilbeau's invasion-of-privacy theory was time-barred, and did not state a claim on which relief could be granted; and (3) the addition of Armor as a defendant was barred by the statute of limitations. In May 2021, the trial court granted these motions.4 ¶6 Guilbeau then dismissed her second lawsuit without prejudice, and timely appealed the trial court's adverse rulings. We assigned the appeal to the Court of Civil Appeals (COCA). The COCA agreed that Guilbeau's negligence claims were barred by the doctrine of claim preclusion, and that the addition of Armor as a defendant was barred by the statute of limitations. Although the COCA found Guilbeau's new invasion-of-privacy claim was not time-barred, it nevertheless affirmed its dismissal, concluding that Guilbeau had no actionable claim. We granted certiorari. STANDARD OF REVIEW ¶7 A trial court may dismiss a civil action if it fails to state a claim on which relief can be granted -- i.e., when it appears beyond doubt that the plaintiff cannot prove any set of facts which would entitle her to relief under the law. 12 O.S. § 2012(B)(6); Gens v. Casady School, 2008 OK 5, ¶ 8, 177 P.3d 565, 568-69. Such dismissals are generally disfavored. Id. We review them de novo, with no deference to the trial court's interpretation of the law, since the function of a motion to dismiss is to test the law supporting the claims, not to weigh facts. See id. "Dismissal is appropriate only for lack of any cognizable legal theory to support the claim or for insufficient facts under a cognizable theory." Id. We also employ de novo review to a trial court's interpretation of doctrines developed by case law, such as issue preclusion and collateral estoppel. Wilson v. City of Tulsa, 2004 OK CIV APP 44, ¶ 8, 91 P.3d 673, 677 (citing Cities Serv. Co. v. Gulf Oil Corp., 1999 OK 14, ¶ 12, 980 P.2d 116, 124). The extent of the common-law right to privacy under Oklahoma law involves questions of legal duty which we also review de novo. State ex rel. Oklahoma Department of Public Safety v. Gurich, 2010 OK 56, ¶ 6, 238 P.3d 1, 3; Delbrel v. Doenges Bros. Ford, Inc., 1996 OK 36, ¶ 7, 913 P.2d 1318, 1320-21. ANALYSIS ¶8 Guilbeau's petition for certiorari raises three challenges to the COCA's decision.5 We address the first two claims together, as our resolution of the first claim renders the second claim moot. A. The negligence claims are barred by the claim-preclusion doctrine. ¶9 We first consider whether Guilbeau was barred from re-asserting her negligence claims in the second lawsuit, after she failed to appeal the trial court's dismissal of those claims in the first lawsuit. Guilbeau's first lawsuit alleged inter alia that Hospital was negligent in its handling of her deceased child's remains, and how it hired, trained, and supervised its employees. The trial court dismissed the negligence claim in November 2016. After extensive discovery, Guilbeau indicated in a pleading that she understood the court's order as only dismissing her general negligence theory, not her negligent-hiring theory. In September 2019, the trial court clarified that its dismissal applied to all negligence theories in Guilbeau's petition. At Guilbeau's request, the trial court agreed to certify that dismissal for interlocutory appellate review. But instead of seeking that review, Guilbeau chose to dismiss what remained of her lawsuit (the single IIED claim) with the option to refile later. When Guilbeau filed her second lawsuit, she included the negligence theories which the trial court had dismissed during the first lawsuit. Defendants moved for dismissal of these claims, because they had been rejected by the trial court in the first lawsuit, and Guilbeau did not seek appellate review of that ruling. ¶10 The doctrine of claim preclusion is an important restriction on a party's ability to re-litigate claims that have previously been rejected or abandoned. It aims for judicial economy, efficiency, and fairness. It seeks to deter litigants from advancing the same arguments over and over in hopes that a better-honed presentation, or a different judge, will yield a different result. Claim preclusion bars relitigation by parties (or their privies) of issues which either were, or could have been, litigated in a prior action which resulted in a prior judgment on the merits. State ex rel. Tal v. City of Oklahoma City, 2002 OK 97, ¶ 20, 61 P.3d 234, 245.6 ¶11 Lawsuits can be complicated things. They often involve several claims, numerous parties, or both, and there are several points at which claims or parties may be dispatched from the lawsuit before a final judgment brings the entire case to a conclusion. What kinds of rulings may be appealed, and when, is a matter of constant concern to lawyers. Generally speaking, when a trial court dismisses some but not all claims or parties before trial, such rulings are not immediately appealable. 12 O.S. § 994; Tinker Inv. & Mortg. Corp. v. City of Midwest City, 1994 OK 41, ¶ 7, 873 P.2d 1029, 1034-35. ¶12 On the other hand, Oklahoma law allows a plaintiff, without the court's permission, to dismiss her lawsuit "without prejudice," i.e. with the option to refile the lawsuit in the future, so long as she acts "before the final submission of the case to the jury, or to the court, where the trial is by the court." 12 O.S. § 683(1). "The statutory provisions [] have been construed many times by this court. Plaintiff ha[s] a right to dismiss without prejudice before final submission of the case, but not thereafter." Tiffany v. Tiffany, 1948 OK 52, ¶ 14, 199 P.2d 606, 672 (collecting cases). ¶13 Among the strategic reasons for dismissing one's lawsuit without prejudice is the ability to seek appellate review of adverse rulings that would not otherwise be immediately appealable. It is now common practice for plaintiffs, aggrieved by an interlocutory ruling, to use the dismissal-without-prejudice option to force appellate review of that ruling without having to wait until the conclusion of the entire case at the trial level. See e.g. Vance v. Federal Nat'l Mortg. Ass'n, 1999 OK 73, ¶ 5, 988 P.2d 1275, 1278 ("After the trial court refused to certify the summary-judgment order as immediately appealable, Mr. Vance dismissed his remaining claims so as to impart finality to the otherwise interlocutory order").7 ¶14 Guilbeau does not contest that this tactic was available to her when she dismissed her first lawsuit (to seek review of the trial court's rejection of her negligence claims). Indeed, she used that very same procedure here, to force appellate review of the trial court's adverse rulings in the second lawsuit. The issue is whether, with regard to the negligence claims, she was too late -- whether her failure to seek review of those rulings upon dismissal of the first lawsuit foreclosed her ability to re-allege those claims at a later time. It did. ¶15 "A submission is final, within the rule prohibiting a dismissal or nonsuit after final submission of the cause, where nothing remains to be done to render it complete." Tiffany, 1948 OK 52, ¶ 9, 199 P.2d at 607 (quoting 27 C.J.S., Dismissal and Nonsuit, § 20b). A trial court's pretrial termination of a claim, such as a grant of summary judgment in favor of the defendant, constitutes a "final submission" under 12 O.S. § 683(1), and forecloses the plaintiff's unilateral right to dismiss that particular claim without prejudice. Brandt v. Joseph F. Gordon Architect, Inc., 1999 OK 67, ¶ 26, 998 P.2d 587, 592. A plaintiff's dismissal of the remaining claims transforms adverse interlocutory rulings into final, appealable orders. Vance, 1999 OK 73 at ¶ 5, 988 P.2d at 1278; Bivins v. State ex rel. Oklahoma Memorial Hosp., 1996 OK 5, ¶ 5 n. 15, 917 P.2d 456, 460 n. 15. ¶16 In Brandt, the plaintiffs filed a multi-claim, multi-defendant tort action. The trial court granted partial summary judgment in favor of one of the defendants, Gordon. The plaintiffs dismissed their suit without prejudice after the court made its summary-judgment ruling from the bench, but before the court formalized the ruling with a written order. Brandt, 1999 OK 67, ¶ 6, 998 P.2d at 589. When the court memorialized its ruling, the plaintiffs claimed it had no jurisdiction to do so. Id. at ¶ 7, 998 P.2d at 589. The central question was whether the trial court had authority to formalize its ruling after an appeal had been initiated. Id. The plaintiffs argued that their dismissal "mooted any pending matters," including the bench ruling that let Gordon out of the case. Id. ¶ 8, 998 P.2d at 589. The plaintiffs' position was that their unilateral dismissal without prejudice 'wiped the slate clean' of any adverse rulings that had not yet been reduced to writing. We disagreed, noting this tactic is barred by 12 O.S. § 683(1). A plaintiff may unilaterally dismiss her suit without prejudice to refiling, except for any claims which had been finally submitted to the trial court. Citing Tiffany, we explained that "[f]inal submission of the case marks the end of plaintiff's dismissal by right...." Brandt, 1999 OK 67, ¶ 12, 998 P.2d at 590. With regard to Plaintiffs' cause of action against Gordon, Plaintiffs were no longer at liberty to dismiss without leave of the court, after the court rendered a bench ruling in Defendant's favor on the summary judgment motions. As a result, Plaintiffs' dismissal was not effective with regard to their claims against Gordon. Id. at ¶ 10, 998 P.2d at 589-590. Regardless of whether the trial court in Brandt had memorialized its ruling, it had extinguished one of the plaintiffs' claims. The plaintiffs could not nullify that ruling by racing to the courthouse and dismissing their entire case before the ruling was reduced to writing. The plaintiffs' unilateral dismissal of their case, without prejudice to refiling, locked in the adverse ruling and made it ripe for appellate review. ¶17 The same is true here. In the first lawsuit, the trial court extinguished Guilbeau's negligence claims on a motion to dismiss. When she dismissed what remained of that lawsuit, without the permission of the court, she was obligated to appeal the court's rejection of her negligence claims at that time if she wished to preserve them. Section 683 of the Civil Procedure Code barred Guilbeau from unilaterally dismissing the case and refiling claims which had been finally submitted to the court before the dismissal. Guilbeau's second lawsuit sought a second bite at the apple on the negligence claims. This is the sort of conduct that the claim preclusion doctrine seeks to prevent. A plaintiff cannot use unilateral dismissal without prejudice to launder adverse rulings out of her case and hope to obtain a different result from the trial court the next time around. ¶18 We conclude, as the COCA did, that Guilbeau's attempt to revive her negligence claims in the second lawsuit was barred under the doctrine of claim preclusion. Because the negligence claims are barred, we need not address Guilbeau's second point on certiorari (the merits of those claims). B. A claim for invasion of privacy could lie on the facts in this case. ¶19 The remaining issue on certiorari centers on the tort of "invasion of privacy" in Oklahoma law. Guilbeau's second lawsuit added a new claim of invasion of privacy. She alleged: "By forcing the body of Plaintiff's deceased child into disrespectful and disturbing positions, posing him with props, and taking numerous photos of Plaintiff's child, Defendants intentionally intruded upon Plaintiff's privacy and the privacy of Plaintiff's deceased child." There seems to be no dispute that as part of the Hospital's "bereavement program," actions beyond simple disposal were taken with the remains of Guilbeau's miscarriage, and that photographs were prepared for her. Guilbeau claims she never consented to this project, that the photographs would have been highly offensive to any reasonable person, and that she personally suffered emotional trauma on seeing them. ¶20 In moving to dismiss this claim, Hospital argued that Guilbeau had no cause of action because the photographs were not taken in a place where she had a reasonable expectation of privacy, and because the photographs were not of Guilbeau's own body. Hospital also asserted that because this claim was raised for the first time in the second lawsuit, it was time-barred. The trial court granted Hospital's motion to dismiss, but did not elaborate on the basis for its ruling.8 ¶21 On appeal, the COCA found that the invasion-of-privacy claim was not time-barred. That ruling is not challenged by Hospital on certiorari. However, the COCA concluded that the claim still failed. In assessing the merits of the claim, the COCA concluded that any right to privacy in this case belonged only to Guilbeau's child, quoting with approval Hospital's assertion that "[N]othing that [Hospital] did to someone else while somewhere else can legally constitute invasion of privacy to Plaintiff" (emphasis by Hospital). In the COCA's estimation, Guilbeau's only route to relief would be through a "relational" right to privacy, but the COCA concluded that no such right exists under our law. We disagree with the COCA's analysis.9 ¶22 The tort of "invasion of privacy" covers at least four different concepts. See generally McCormack v. Oklahoma Pub. Co., 1980 OK 98, ¶ 3, 613 P.2d 737, 739; Restatement (Second) of Torts § 652A. One variant is "intrusion upon seclusion," which the Restatement defines as follows: One who intentionally intrudes, physically or otherwise, upon the solicitude or seclusion of another or his private affairs or concerns, is subject to liability to the other for invasion of his privacy, if the intrusion would be highly offensive to a reasonable person. Restatement (Second) of Torts § 652B (1977). We have recognized the "intrusion upon seclusion" theory as part of our law in several cases. Munley v. ISC Financial House, Inc., 1978 OK 123, ¶¶ 13-17, 584 P.2d 1336, 1339-40; Chandler v. Denton, 1987 OK 38, ¶ 15 n. 21, 741 P.2d 855, 864 n. 21; Hadnot v. Shaw, 1992 OK 21, ¶ 19, 826 P.2d 978, 985-86; and Gilmore v. Enogex, Inc., 1994 OK 76, ¶¶ 15-16, 878 P.2d 360, 366. The claim has two elements: (1) a nonconsensual intrusion (2) which would be highly offensive to a reasonable person. Gilmore, id. at ¶ 16, 878 P.2d at 366. ¶23 Hospital's framing of the issue was flawed in two ways. First, the fact that the conduct took place in a hospital setting does not bar Guilbeau from claiming an unlawful intrusion into her personal affairs. While the phrase "intrusion upon seclusion" may conjure images of the Peeping Tom -- someone spying into another's home -- the concept is clearly broader than that. It extends to the acquisition of any information to which the general public is not entitled: It may be by some other form of investigation or examination into [a person's] private concerns, as by opening his private and personal mail, searching his safe or his wallet, examining his private bank account, or compelling him by a forged court order to permit an inspection of his personal documents. . . . Restatement (Second) of Torts § 652B, comment b (quoted with approval in Hadnot, 1992 OK 21, ¶ 19 n.33, 826 P.2d at 986 n.33). The physical setting of the conduct, and the particulars of the interactions between Guilbeau and hospital staff leading up to it, may well be relevant to an essential element of Guilbeau's claim: whether she consented to the project as Hospital alleges. But the right to privacy is concerned with people, not places. See e.g. Berthiaume's Estate v. Pratt, 365 A.2d 792 (Me. 1976) (physician's unauthorized taking of photographs of hospital patient who was near death invaded patient's legally protected right to privacy). In any event, the COCA did not base its decision on this part of Hospital's argument, and we need not consider it further. ¶24 Second, Hospital argued that Guilbeau could not state a claim for injury based on conduct involving the remains of someone else. This was the focus of the COCA's analysis, as it discussed the so-called relational right to privacy, and declined to find such a right in Oklahoma law. We believe that analysis is off the mark. ¶25 The idea that a family member may have a cause of action for emotional distress over the handling of a loved one's remains is not new. See Larson v. Chase, 50 N.W. 238 (Minn. 1891) (wife had cause of action for mental distress caused by unlawful mutilation and dissection of her deceased husband's body). In McPosey v. Sisters of the Sorrowful Mother, 1936 OK 346, 57 P.2d 617, the plaintiff's wife died in a hospital after an illness. He sued the hospital and others for (among other things) mental anguish, pain, and grief occasioned by the fact that an autopsy was performed on his wife's body without his consent. The trial court granted the defendants' demurrers, and the plaintiff appealed. We reversed and remanded for further proceedings. We held the unauthorized mutilation of a corpse gave rise to a cause of action for the deceased's husband. We observed that under our law (see now 21 O.S. § 1158), the husband had a right to control the disposition of his wife's remains.10 But we also recognized that the controversy was not reducible to a simple property right: What we have said already would be sufficient to cause us to remand the matter to the trial court if it were not for the fact that from a reading of the records and briefs of the parties we are convinced that the principal point argued and decided was the attempt to recover damages for mental anguish, pain, and grief because of the mutilation of the corpse of the wife. McPosey, 1936 OK 346, ¶ 9, 57 P.2d at 618. We concluded that a cause of action existed in tort for the plaintiff's mental anguish over the way his wife's body was treated. Id. at ¶ 13, 57 P.2d at 619. While the analysis in McPosey was not framed in terms of "invasion of privacy," we believe the case offers guidance here. McPosey stands for the basic proposition that one may have a cause of action in tort for the improper handling of human remains. ¶26 In rejecting Guilbeau's invasion-of-privacy claim, the COCA focused on the child's "right not to be photographed," even though the child did not survive birth. In Bazemore v. Savannah Hospital, 155 S.E. 194 (Ga. 1930), the plaintiffs' severely malformed child died shortly after birth. The hospital permitted someone to photograph the child's body. The plaintiffs' invasion-of-privacy claim against the hospital was dismissed on a general demurrer. The Georgia Supreme Court reversed, holding that a cause of action for invasion of privacy existed. In so holding, the court observed: The suit is not based on injury to the deceased child. According to the allegations, the wrongs done by the defendants were committed after the death of the child. Therefore in this case there is no question of the survival of a right of action. The right, if it ever existed or now exists, began after the death of the child, and is a right of action on the part of the plaintiffs. Id. at 196. ¶27 We find Bazemore persuasive on this point. In fact, the instant case is more straightforward than either McPosey or Bazemore. This case is not concerned simply with Guilbeau's right to control the handling of a loved one's body, but with the handling of the remains from her own miscarriage.11 While her petition could have been more artfully drafted, Guilbeau did allege an invasion of her own right to privacy. That Hospital's conduct was occasioned by an unsuccessful attempt to bring another human life into the world only underscores that the primary focus should be on Guilbeau. No other person's right to privacy could have been invaded, as the child did not survive birth. The miscarriage was more personal to Guilbeau than to anyone else in the world. ¶28 What is more, the photographs that were taken did not simply record what might have been viewed, say, by a funeral attendee, or in a morgue, or even by hospital staff. According to Guilbeau's petition, the images did something more: they documented the handiwork of someone who intentionally manipulated the remains. The right to control how the remains were handled belonged to Guilbeau. ¶29 To summarize, on these facts we find it unnecessary to consider what might constitute a "relational" right to privacy and whether that right exists in Oklahoma. It was Guilbeau herself who experienced the miscarriage, and she was presented with photographs directly related to her experience and the handling of the remains. We express no opinion on whether Guilbeau can establish that the Hospital's bereavement project was either (1) done without her consent or (2) highly offensive to a reasonable person. We simply hold that she has stated a claim on which relief could be granted under existing Oklahoma law. CONCLUSION ¶30 The Court of Civil Appeals was correct when it held that Guilbeau could not re-assert her negligence claims in her second lawsuit. However, the Court of Civil Appeals erred in finding that Guilbeau's invasion-of-privacy theory failed to state a claim on which relief could be granted. The remainder of the Court of Civil Appeals' opinion remains undisturbed. COURT OF CIVIL APPEALS' OPINION VACATED; TRIAL COURT AFFIRMED IN PART AND REVERSED IN PART; CASE REMANDED FOR FURTHER PROCEEDINGS CONCUR: KANE, C.J., ROWE, V.C.J., and KAUGER, EDMONDSON, COMBS, GURICH and KUEHN, JJ. DISSENT: WINCHESTER and DARBY, JJ. FOOTNOTES 1 Bryan County District Court Case No. CJ-2016-142. 2 The petition in the first lawsuit alleged a single "Negligence" cause of action. Under that heading, after alleging a breach of a basic duty of care to handle the child's body in a respectful manner and Hospital's vicarious liability, this section of the petition states: "Additionally, [Hospital] owed a direct duty to Plaintiff to hire, train and supervise its employees such that its employees/agents would not cause injury or harm...," and that this failure caused Guilbeau harm. 3 Bryan County District Court Case No. CJ-2020-239. 4 Hospital and Armor (represented by the same counsel) filed separate motions to dismiss. Hospital's partial motion to dismiss sought to extinguish all claims against it except for IIED, alleging that both negligence claims were barred, that the invasion-of-privacy claim was untimely, and that all three failed to state a claim as a matter of law. Armor's motion to dismiss echoed Hospital's, and added that she should be dismissed as a defendant altogether because the statute of limitations for naming her as a party had run. Guilbeau amended her petition a week later, setting out a "Negligent Training, Hiring, and Supervision" claim separately from the "Negligence" claim. After Guilbeau amended her petition, Defendants renewed their motions to dismiss. 5 While the COCA also concluded that the addition of Armor as a defendant in the re-filed suit was time-barred, Guilbeau does not challenge that ruling in her petition for certiorari, so we do not consider it. Oklahoma Supreme Court Rule 1.180(b), 12 O.S., App. 1; Robey v. Long Beach Mtg. Corp., 2005 OK 64, ¶ 1 n. 1, 124 P.3d 221, 222 n. 1. Guilbeau obviously does not challenge the COCA's conclusion that her invasion-of-privacy claim was timely, and Hospital has not asked us to review that ruling on certiorari. 6 The concept goes by various names in various contexts, but the overarching concerns are basically the same. Claim preclusion, or res judicata at common law, prevents a party in a second suit between the same parties, or their privies, from relitigating an adjudicated claim as well as issues of fact or law necessary to the previous final judgment on the merits, or relitigating those issues which could have been decided in the previous suit. . . . Issue preclusion, or collateral estoppel at common law, prevents relitigation of an issue in a second suit on a different claim. . . . Farley v. City of Claremore, 2020 OK 30, ¶ 24 n. 54, 465 P.3d 1213, 1227 n. 54. Here we use the term "claim preclusion," because we are dealing with legal theories of recovery, extinguished as a matter of law by the trial court in one lawsuit, which were then re-presented to the same court in a successor lawsuit. 7 See also Hollingshead v. Elias, 2016 OK CIV APP 46, ¶¶ 15-16, 376 P.3d 936, 940-41; Waits v. Viersen Oil & Gas Co., 2015 OK CIV APP 95, ¶ 10, 361 P.3d 562, 564; Schoenhals v. PSR Investors, Inc., 2013 OK CIV APP 27, ¶ 10, 299 P.3d 874, 877 ("So, where the trial court adversely adjudicates fewer than all of a plaintiff's claims, and the plaintiff subsequently voluntarily dismisses the remainder of his or her unadjudicated claims, the prior order adversely adjudicating some but not all of plaintiff's claims is then final and subject to appeal"); Patel v. Tulsa Pain Consultants, Inc., PC, 2015 OK CIV APP 45, ¶¶ 18--25, 348 P.3d 1117, 1122-23; Raven Resources, L.L.C. v. Legacy Bank, 2009 OK CIV APP 101, ¶¶ 8-15, 229 P.3d 1273, 1277-1280. 8 Defendant Armor made similar challenges to the invasion-of-privacy claim, along with an argument that Guilbeau waited too long to name her as a party defendant. The trial court agreed with the latter argument as well; the COCA affirmed. That part of the COCA's decision concerned with the untimely joinder of Armor as a defendant is not presented for our review. 9 In their summaries of the proceedings below, both parties indicate the trial court ruled only that the invasion-of-privacy claim was time-barred, and did not reach the substance of the claim. Hence, while we have the COCA's analysis of why the claim itself is groundless, we have no indication of the trial court's opinion on the matter. 10 The idea that one may have a cause of action for emotional distress over the improper handling of a family member's remains appears to have been based, originally, on the theory that the remains were considered to be the property of a specified relative. This theory is now viewed as antiquated, a "technical right [that] has served as a mere peg upon which to hang damages for the mental distress inflicted upon the survivor... ." Restatement (Second) of Torts § 868, comment a. 11 To the extent Oklahoma law on the right to control disposition of human remains guides our analysis, we note that Guilbeau had the right to control the disposition of both the remains of a deceased child, as well as any part of her own body. See 21 O.S. § 1158(5) (including a "surviving parent" in list of those with the right to control the disposition of remains); 21 O.S. § 1157 ("All provisions of this article ... punishing interference with or injuries to a dead body, applying [sic] equally to any dead limb or member of a human body, separated therefrom during lifetime").

f800cbf2-6454-4b75-8f05-8b77de3c41cf

Pike Off OTA v. Okla. Turnpike Auth.

oklahoma

Oklahoma Supreme Court

PIKE OFF OTA v. OKLAHOMA TURNPIKE AUTHORITY2023 OK 57Case Number: 121039Decided: 05/23/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. PIKE OFF OTA, INC., AMY CERATO, MIKE LEARY, VINCE DOUGHERTY, TERRIE CLUB, MIKE CLUB, TWYLA SMITH, CALI COWARD, KAREN POWELL, MIKE POWELL, CEDRIC LEBLANC, DARLA LEBLANC, CLAUDETTE WISPE, MARK DOOLING, NATE PIEL, KARA PIEL, NIKKI WHITSON, JOHN WHITSON, ROBERT WALLACE, CHELSEA WALLACE, ROBIN STEAD, ANNA OLSON, TASSIE HIRSCHFELD, ICE BLAST LLC, and JANETTE WARD, Plaintiffs/Appellants, v. OKLAHOMA TURNPIKE AUTHORITY, Defendant/Appellee. ON APPEAL FROM THE DISTRICT COURT OF CLEVELAND COUNTY Honorable Timothy L. Olson, Trial Judge ¶0 The appellants challenge the Oklahoma Turnpike Authority's authority to construct new turnpikes under the ACCESS Oklahoma Program. The Oklahoma Turnpike Authority moved to dismiss the appellants' claims, arguing that the claims are within the exclusive original jurisdiction of this Court. The district court granted the Oklahoma Turnpike Authority's motion to dismiss, and the appellants appealed. This Court retained the case. We hold that this Court has exclusive original jurisdiction to determine whether the Oklahoma Turnpike Authority is authorized to construct the proposed turnpikes in the bond validation matter. We further rule that the appellants failed to establish that they have a clear legal right to the injunctive and/or mandamus relief sought. The appellants' claim is also dependent upon the Court exercising its exclusive jurisdiction in the bond validation proceeding. DISTRICT COURT'S JUDGMENT AFFIRMED. Robert E. Norman, Cheek & Falcone, PLLC, Oklahoma City, Oklahoma, for Appellants. Phillip G. Whaley and Grant M. Lucky, Ryan Whaley, Oklahoma City, Oklahoma, for Appellee. Winchester, J. ¶1 Appellants Pike Off OTA, Inc., Amy Cerato, Mike Leary, Vince Dougherty, Terrie Club, Mike Club, Twyla Smith, Cali Coward, Karen Powell, Mike Powell, Cedric Leblanc, Darla Leblanc, Claudette Wispe, Mark Dooling, Nate Piel, Kara Piel, Nikki Whitson, John Whitson, Robert Wallace, Chelsea Wallace, Robin Stead, Anna Olson, Tassie Hirschfeld, Ice Blast LLC, and Janette Ward (collectively Appellants) brought their claims in the Cleveland County District Court, challenging the Oklahoma Turnpike Authority's (OTA) authority to construct three proposed turnpikes: the Tri-City Connector, the East-West Connector, and the South Extension. The OTA moved to dismiss these claims, arguing that Appellants' claims are within the exclusive original jurisdiction of this Court. The district court granted the OTA's motion to dismiss, and Appellants appealed. This Court retained the case. ¶2 The issues before the Court are (1) the constitutionality of 69 O.S.2021, § 1718, conferring on this Court the exclusive original jurisdiction to determine the validity of proposed bonds to construct and operate turnpikes; (2) whether Appellants' claims challenging the OTA's authority to construct the three proposed turnpikes fall within the Court's exclusive original jurisdiction; and (3) whether Appellants' claim for injunctive and/or mandamus relief regarding the OTA's alleged violations of the legal duties, obligations, and rights of Appellants and other Oklahoma citizens in building the turnpikes falls within the Court's exclusive jurisdiction. ¶3 For the reasons stated herein, we hold § 1718 is constitutional, as the Oklahoma Constitution specifically provides that appellate courts may exercise such jurisdiction as conferred by statute, and Appellants' claims challenging OTA's authority to construct the three proposed turnpikes fall within the exclusive jurisdiction of this Court. See Okla. Const. art. VII, § 4. We further rule that Appellants failed to establish that they have a clear legal right to the injunctive and/or mandamus relief sought. Instead, Appellants only vaguely pled duties that the OTA may violate at some point in the future. Further, Appellants' claim demanding that the OTA comply with some undefined laws or statutory duties is contingent upon whether this Court approves the OTA's proposed bond issue. Therefore, the claim is dependent upon the Court exercising its exclusive jurisdiction in the bond validation proceeding. The district court did not err in granting the OTA's motion to dismiss. FACTS AND PROCEDURAL HISTORY ¶4 In early 2022, the OTA announced a set of proposed new turnpikes and other projects to improve current turnpikes and their infrastructure, titling the project ACCESS1 Oklahoma. The three proposed turnpikes are 1) the Tri-City Connector, running around the west side of the Will Rogers World Airport to I-44; 2) the East-West Connector, connecting the H.E. Bailey Turnpike around Newcastle heading east on Indian Hills Road to the south of Draper Lake, then heading northeast connecting to the Kickapoo Turnpike and completing the Oklahoma City Outer Loop (Loop); and 3) the South Extension, running from I-35 west of Slaughterville and north of Purcell, across the South Canadian River and north through Norman, west of Thunderbird Lake, connecting with the East-West Connector. ¶5 The issues in this case involve the last two segments to connect and finalize the Loop (the Tri-City Connector and the East-West Connector) and the final segment of the South Extension. On May 2, 2022, Appellants filed their petition in the district court, claiming (1) the OTA lacks statutory authorization to construct the South Extension; (2) the OTA has exceeded its statutory authorization by seeking an additional bond issue to complete the Loop; and (3) even if legally authorized, how the OTA is attempting to build the turnpikes violates Oklahoma citizens' legal and due process rights under several state and federal laws. ¶6 On June 13, 2022, the OTA filed a Motion to Dismiss, arguing that pursuant to 69 O.S.2021, § 1718, the Supreme Court has exclusive subject matter jurisdiction over Appellants' claims. Appellants responded, claiming the exclusive original jurisdiction provisions of § 1718 are unconstitutional. They further argued that even if this Court has jurisdiction, their claim for injunctive and/or mandamus relief arising from the OTA's violations of their rights does not fall within the Court's exclusive jurisdiction to validate bonds. ¶7 On August 10, 2022, the OTA filed an original action requesting that this Court approve revenue bonds to finance the construction of the three proposed turnpike projects, update and repair turnpike facilities and infrastructure, refund prior revenue bonds and notes, and pay other costs. On September 9, 2022, Appellants filed a protest in the bond validation matter, arguing the OTA lacked statutory authority to issue additional bonds to finalize the Loop and lacked authority to construct the South Extension. On October 10, 2022, the Court entered an order assuming original jurisdiction.2 ¶8 On December 12, 2022, the district court sustained the OTA's Motion to Dismiss, holding Appellants' claims were virtually the same as those outlined in their protest filed in the Supreme Court bond validation matter and the Court has original and exclusive jurisdiction to hear Appellants' claims. Appellants appealed. This Court retained the appeal. STANDARD OF REVIEW ¶9 The Court reviews a district court's grant of dismissal motions de novo. See, e.g., Farley v. City of Claremore, 2020 OK 30, ¶ 17, 465 P.3d 1213, 1224 (an order granting a motion to dismiss that raises a jurisdictional issue is reviewed de novo). At issue in this case is the constitutionality of 69 O.S.2021, § 1718. Whether a statute is constitutional is also a question of law subject to this Court's de novo review. Lee v. Bueno, 2016 OK 97, ¶ 6, 381 P.3d 736, 739. In exercising de novo review, "this Court possesses plenary, independent, and non-deferential authority to examine the issues presented." Id. ¶ 6, 381 P.3d at 740. When determining the constitutionality of a statute, "courts are guided by well-established principles, and a heavy burden is cast on those challenging a legislative enactment to show its unconstitutionality." Id. ¶ 7, 381 P.3d at 740. The party seeking a ruling that a statute is unconstitutional has the burden to show the statute is clearly, palpably, and plainly inconsistent with the Constitution. Lafalier v. Lead-Impacted Cmtys. Relocation Assistance Tr., 2010 OK 48, ¶ 15, 237 P.3d 181, 188. ANALYSIS I. The statute by which the Legislature conferred upon the Court exclusive original jurisdiction to determine the validity of proposed bonds to construct and operate turnpikes is constitutional. ¶10 The Legislature conferred upon the Court "exclusive original jurisdiction" to determine the validity of proposed bonds to construct and operate turnpikes. 69 O.S.2021, § 1718. The Court's exclusive original jurisdiction entails: The Authority is authorized in its discretion to file an application with the Supreme Court of Oklahoma for the approval of any bonds to be issued hereunder, and exclusive original jurisdiction is hereby conferred upon the Supreme Court to hear and determine each such application. . . . If the Court shall be satisfied that the bonds have been properly authorized in accordance with this article and that when issued, they will constitute valid obligations in accordance with their terms, the Court shall render its written opinion approving the bonds and shall fix the time within which a petition for rehearing may be filed. The decision of the Court shall be a judicial determination of the validity of the bonds, shall be conclusive as to the Authority, its officers and agents, and thereafter the bonds so approved and the revenues pledged to their payment shall be incontestable in any court in the State of Oklahoma. Id. Appellants argue that 69 O.S.2021, § 1718 is unconstitutional. They note that while § 1718 gives the Court exclusive original jurisdiction, when Article VII, Section 7(a) of the Oklahoma Constitution was adopted by a vote of the people in 1967, it gave all district courts "unlimited original jurisdiction," overriding the Legislature's grant of jurisdiction to this Court and giving district courts and the Supreme Court concurrent jurisdiction. ¶11 In support, Appellants point to Article VII, Section 7(a) of the Oklahoma Constitution, which states that "[t]he District Court shall have unlimited original jurisdiction of all justiciable matters, except as otherwise provided in this Article." Okla. Const. art. VII, § 7. ¶12 Appellants, in making their argument, omit the portion of the sentence in Section 7(a), "except as otherwise provided in this Article." Id. (emphasis added). In other words, the district courts have jurisdiction except where Article VII of the Constitution limits it or confers it on another court. See Colton v. Huntleigh USA Corp., 2005 OK 46, ¶10, 121 P.3d 1070, 1073; State ex rel. Sw. Bell Tel. Co. v. Brown, 1974 OK 19, ¶21, 519 P.2d 491, 495. ¶13 In Article VII, Section 4, the Oklahoma Constitution gives appellate courts the "power to issue, hear and determine writs of habeas corpus, mandamus, quo warranto, certiorari, prohibition and such other remedial writs as may be provided by law and may exercise such other and further jurisdiction as may be conferred by statute." Okla. Const. art. VII, § 4 (emphasis added). The Constitution expressly empowers the Court to exercise jurisdiction conferred by statute, including the jurisdiction conferred upon it in § 1718. See, e.g, In re Application of Okla. Dep't of Trans., 2003 OK 105, ¶ 6 n.5, 682 P.3d 1000, 1002 n.5; see also In re Matter of Okla. Dev. Fin. Auth., 2022 OK 47, ¶ 9, 511 P.3d 1052, 1056.3 ¶14 We also note that this Court has acted under § 1718 many times to approve bonds since 1969. See, e.g., In re Application of Okla. Tpk. Auth, 2018 OK 88, ¶ 1, 431 P.3d 59, 59-60 (noting that the proceeding was authorized pursuant to § 1718); In re Application of Okla. Tpk. Auth., 2016 OK 124, ¶ 2, 389 P.3d 318, 319 (holding that under § 1718, the Court is vested with exclusive, statutory original jurisdiction to hear and determine the OTA's applications for bond approval); In re Application of Okla. Tpk. Auth., 1989 OK 21, ¶ 3, 770 P.2d 16, 18 (noting that the proceeding was authorized by § 1718, giving the Court original jurisdiction in the cause); Application of Okla. Tpk. Auth., 1969 OK 176, ¶ 3, 460 P.2d 952, 952 (holding the Court accepted jurisdiction pursuant to § 1718). And this Court is currently exercising original jurisdiction under § 1718 in the bond validation proceeding for the three proposed turnpikes. ¶15 The Oklahoma Constitution clearly permits the Legislature to confer exclusive original jurisdiction upon the Court under § 1718 to hear and determine an application for bond validation to construct and operate turnpikes, and the statute is constitutional. II. Appellants' claims challenging the OTA's authority to finalize the Loop and build the South Extension fall within this Court's exclusive jurisdiction. ¶16 We now turn to the issue of whether Appellants' claims that the OTA lacks statutory authorization to finalize the Loop and build the South Extension fall within this Court's exclusive jurisdiction. For over 70 years, this Court construed the Legislature's grant of jurisdiction as giving the Court sole authority to determine all questions of sufficiency of the law to authorize bonds and construct turnpikes. Okla. Tpk. Auth. v. Dist. Court of Lincoln Cty., 1950 OK 147, ¶ 11, 222 P.2d 514, 518. The Court must consider the validity of the bonds, the constitutionality of the bonds, and the OTA's authority to construct and operate turnpikes. Id. ¶ 6, 222 P.2d at 517. Appellants' claims regarding (1) whether the OTA lacks statutory authorization to construct the South Extension, and (2) whether the OTA has exceeded its statutory authorization by seeking an additional bond issue to complete the Loop are directly within the exclusive jurisdiction of this Court. ¶17 The OTA invoked the Court's exclusive jurisdiction under § 1718 when it filed its application with this Court to validate the bonds for these turnpikes. And that exclusive jurisdiction makes any determination by this Court binding upon the lower court. To hold otherwise might present a conflict of jurisdictions where this Court approves the bonds and the OTA's ability to proceed with its proposed turnpikes and a judgment by the district court bars the OTA from exercising this authority. See id. ¶ 8, 222 P.2d at 517. Even a potential conflict of jurisdiction between the two courts should be avoided. ¶18 This Court gained exclusive jurisdiction to consider the questions raised by Appellants in the district court when the OTA filed its application to validate the proposed bonds. In fact, Appellants have filed a protest placing these exact claims at issue in the bond validation matter. The district court did not err in granting the OTA's motion to dismiss Appellants' claims regarding whether the OTA lacks the statutory authorization to finalize the Loop and build the South Extension. III. Appellants' claim demanding that the OTA comply with laws or statutory duties is contingent upon whether this Court approves the OTA's proposed bond issue. ¶19 Appellants further argue that the district court erred in dismissing their claim for injunctive and/or mandamus relief for the OTA's alleged violations of legal duties, obligations, and rights of Appellants and Oklahoma citizens in building the proposed turnpikes. Appellants contend that the claim has a subject matter that is separate and not dependent upon this Court's decision in the bond validation case. We disagree. ¶20 Appellants requested preliminary and permanent injunctive and/or mandamus relief from the district court compelling the OTA to perform, comply with, and abide by all legal duties, obligations, and due process rights of Appellants and other Oklahoma citizens. Appellants vaguely alleged these duties or obligations in their petition and amended petition, listing thorough and adequate economic studies, environmental studies, feasibility studies, geological studies, studies regarding impacts on citizens and their property, alternative route studies, and conservation resource easement impact studies without citing specific laws that create duties or obligations that the OTA must follow. Appellants also failed to make any allegation that the OTA has violated any specific law or statutory duty. Instead, Appellants requested that the district court order the OTA to comply with these unspecified duties or obligations. ¶21 Appellants are not seeking the typical preventative or prohibitive injunction to preserve the status quo. Instead, Appellants seek a mandatory injunction, which is an "extraordinary remedial process that commands the performance of some positive act." See Owens v. Zumwalt, 2022 OK 14, ¶ 8, 503 P.3d 1211, 1214. The rules regarding injunctions are more strictly construed when applied to mandatory injunctions. Appellants seeking a mandatory injunction must show a violation of a clear legal right and a case of necessity and great hardship. Id. ¶22 In the same way, mandamus may only be issued by a district court to compel the performance of an act that the law specially enjoins as a duty resulting from an office, trust, or station. 12 O.S.2021, §1451. However, to avail themselves of this equitable remedy, Appellants must show they have a clear legal right to it and that the law otherwise provides no adequate relief. And the OTA must have a plain legal duty in which the exercise of discretion is not implicated. Okla. Gas & Elec. Co. v. Dist. Court, Fifteenth Judicial Dist., Cherokee Cty., 1989 OK 158, ¶ 8, 784 P.2d 61, 63; Marland v. Hoffman, 1939 OK 109, ¶ 11, 89 P.2d 287, 289. And being without an absolute right to the extraordinary remedy, it is within the discretion of the court to withhold relief if the relief sought is not clear. Porch v. Hayes, 1951 OK 310, ¶ 8, 236 P.2d 240, 242. Here, Appellants fail to specify any legal duty or obligation that OTA will violate at some point in the future and, in turn, have not pled a clear legal right to the relief sought. ¶23 Even more, the relief sought by Appellants is under the jurisdiction of this Court, as this Court has exclusive jurisdiction to determine the OTA's authority to construct and operate the proposed turnpikes. Appellants' claim demanding that the OTA comply with unspecified duties or obligations is contingent upon whether this Court approves the OTA's proposed bond issue. The exact issue of the OTA's authority to construct and operate the proposed turnpikes is to be determined by the Court under its exclusive jurisdiction in the bond validation proceeding. Therefore, the district court did not err in granting the OTA's motion to dismiss regarding Appellants' claim for injunctive and/or mandamus relief. CONCLUSION ¶24 This Court has exclusive original jurisdiction to determine Appellants' claims that the OTA does not have the authority to construct the proposed turnpikes. We further rule that Appellants failed to establish that they have a clear legal right to the injunctive and/or mandamus relief sought. Appellants' claim is also dependent upon the Court exercising its exclusive jurisdiction in the bond validation proceeding. For these reasons, the district court did not err in granting the OTA's motion to dismiss. DISTRICT COURT'S JUDGMENT AFFIRMED. CONCUR: KANE, C.J., ROWE, V.C.J. (BY SEPARATE WRITING), KAUGER, WINCHESTER, EDMONDSON, GURICH, DARBY AND KUEHN, JJ. NOT PARTICIPATING: COMBS, J. FOOTNOTES 1 ACCESS stands for "Advancing and Connecting Communities and Economies Safely Statewide." 2 Appellants note that the order entered by the Court stated that the "assumption of jurisdiction does not extend to the matters now pending before the District Court, nor does our assumption of jurisdiction serve to stay the issues now pending before the District Court." The Court entered this order without making any determination of the Court's jurisdiction as to the matters pending before the district court at the time because those issues were not directly before this Court. 3 Other statutes also confer exclusive original jurisdiction on the Supreme Court. See, e.g., 19 O.S.2021, § 87; 20 O.S.2021, § 14.1; 74 O.S.2021, § 9079; 82 O.S.2021, §§ 882 and 1085.42. ROWE, V.C.J., concurring: ¶1 I concur in the Court's judgment that 69 O.S.2021 § 1718 is constitutional and that Appellants' claims fall within this Court's exclusive jurisdiction. I write separately to stress that our holding in this matter has no bearing on the outcome of the Oklahoma Turnpike Authority's request to validate the issuance of the bond package to finance the ACCESS Oklahoma projects, currently pending before us.1 FOOTNOTES 1 See In re Application of Okla. Tpk. Auth. for Approval of Not to Exceed $500,000,000 Okla. Tpk. Sys. Second Senior Lien Revenue Bonds, Series 2022, No. 120,619 (Okla. filed Aug. 10, 2022).

e6358213-c150-4d5b-8ed3-4e21214b6b7d

Hirschfeld, et al. v. Oklahoma Turnpike Authority

oklahoma

Oklahoma Supreme Court

HIRSCHFELD v. OKLAHOMA TURNPIKE AUTHORITY2023 OK 59Case Number: 120981Decided: 05/31/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TASSIE KATHERINE HIRSCHFELD, VERA GAYLE WARD, STANLEY M. WARD, RARCHAR TORTORELLA, TERESA ELAM, CAROL HERRON, JERRY HERRON, AMY CERATO, REBECCA RIGSBY, MICHAEL RIGSBY, BRIAN HALL, SHONIA HALL, RAY COULEMAN, TERRI COULEMAN, JILL THOMPSON, LINDA BARRY, JENNIE PATTERSON, MATT THOMPSON, VINCENT DOUGHERTY, KARLA MORTON, BOB GOODWIN, ROBYN GOODWIN, ROBERT WALLACE, CHELSEA WALLACE, CANDANCE F. HOTTLE, JANICE CHADWICK, CYNTHIA BARNARD, GENE KELLY RINER, FREDERICK THOMPSON, CHRISTINE THOMPSON, MARIAL LEE MARTYN, WESLEY E. CHANNELL, ROBIN STRADER, JEFFREY STRADER, NATACHA STRADER, MONTGOMERY LONG, DANNY CARPENTER, RITA CARPENTER, J.D. KROMER, KAREN GOODCHILD, WILLIAM JOHNSON, DONALD CORY, ROBBIE WHEELER, AMBER TUCKER, TOMMY LINGLE, LANEESE LINGLE, JEFFREY CARSON, SHARON FARRIS, MARIA KINDEL, JONATHAN KINDEL, BRIAN HOUCK, ROY TRITTEN, ANGIE FENTON, ARCHIE CLARK, DEBBIE CLARK, MARK DOOLING, CLAUDETTE WISPE, GILDA SUZANNE FAILING, ALLISON RENEE FAILING, GREGORY MATTHEW FAILING, KELLY RENAE KING, MICHAEL DODSON, PAULA DODSON, GARY MURRIAN, BARBARA MURRIAN, DEBRA A SALTZMAN, PAM MCINTOSH, CHRIS MILLSAP, KEVIN MILLSAP, BRIAN MITCHELL, CURTIS MITCHELL, NAOMI GOOCH, FRANCES MICHELLE SUMMERS, GUINNEVERE GEYER, TERESA HEARD, TERRY ANDERSON, TERESA ANDERSON, MELISSA BLEVINS, ROBIN SCHWAB, JOHN PAUL GAY, CHARLOTTE GAY, JIM BRISCOE, MATTHEW HOLLIS, KIMBERLY HOLLIS, DAN RYAN, NICOLE CROWSON, ANNETTE JAYE WATSON-PATTEN, LAYTON GOAD, HILARY WRIGHT, ELDON MURNAN, LINDA MURNAN, CHERYL LYNN BAY, TESSA, JOSEPH CONERLY, CHARLES JAY ARMSTRONG, ELLEN ANN EDGE, STEVE WEICHBRODT, JONI WEICHBRODT, MITCH BAROFF, JANET BRADFORD, DAVID A. BRADFORD, JAMES H. LITTLE, DAKOTA COOK, DIAN STEWART, ANTHONY STEWART, JEANETTE JAHNKE, JOY CUMMINGS, DARY STACY, TERENCE CUMMINGS, TASHA STACY, BRET STACY, KERENSA MARIE STURGELL, JOSHUA CADE ADKISSON, PATRICIA A O'BRIEN, SUE MARSHALL, DAVID MARSHALL, BRET A. DUFFEY, MINDY J. MCCALLICK-DUFFEY, ALI BEAUCHAMP, DON SONTHEIMER, DIANE VANLANDINGHAM, TANNER EUGENE NAEHER, DAVID LISENBERY, JR., SUSAN BEAUCHAMP, PHILIP BEAUCHAMP, TADD BLISS, TADD BLISS II, AUSTIN BEAUCHAMP, KENZIE THOMPSON, TIFFANY MICHELLE STEPHENS, CASSIE BROWN, WILLIAM DUSTIN HACKATHORN, TWYLA JEAN SMITH, JOEL ELLIS HOLLOWAY, GARY JAMES BILLINGSLEY, DARLYNN SADIE BILLINGSLY, PAMELA SUE GROOM, DARLA JOY LEBLANC, CEDRIC JAMES LEBLANC, DANIEL BROCKHAUSE, KEITH BROCKHAUSE, CAROLL SOTO, DONNA IRENE VINT, MELISSA MARIE YOUNG, GRACE WAGNER, TARA WAGNER, ISAAC IAN YOUNG, STANLEY M. WARD AS TRUSTEE OF THE STANLEY M. WARD REVOCABLE TRUST DATED OCTOBER 23, 2014; VERA GAYLE WARD AS TRUSTEE OF THE VERA GAYLE WARD REVOCABLE TRUST DATED OCTOBER 23, 2014, DAWN M. GOLDSMITH, KAREN TERESA CONTRERAS, BRIGITTE Y. KERSTEN-GATES, TOM HACKLEMAN, JOYCE JOHNSON, MELINDA SITES, STEPHEN E. SITES, ANDREW SPROUSE, JESSICA SPROUSE, MICHELLE TRISSELL, AUBREY WASHINGTON, RACHEL LYNN ROACH, WARREN KIPER, GARY J. HUMPHREY, RAGENIA G HUMPHREY, TONI YVONNE HOY, JEREMY LUKE HOY, JESSICA DARNELL, MAURICE SMITH, DIANA SMITH, GLEN RICHARDSON, MARY RICHARDSON, JANNA ROUSEY, HERB ROUSEY, KATHY PAGANONI, JOESPH PAGANONI, ANGELA PAGANONI, JOHN S. PAGANONI, RANDY POWELL, VICKI POWELL, DAVID W. CLARK, CHAD UNRUH, NATALEE UNRUH, JANET GAIL KIRBY, CLARA M. BOGGS, BRANDON NOFIRE, ALLIS CATHERINE MADOLE-VAUGHN, LISA FRANCIOSE OLSON SHARP, HOWARD PENNINGTON, CINDY PENNINGTON, PATRICIA J. RUCKER, ANDREW KAREKJAS, JORDAN DOERFEL, JENNIFER MARIE LARSEN, DAVIS BEAUCHAMP, MARIANNE BEAUCHAMP, JOHN KENNITH WHITSON, NICOLE LESLIE WHITSON, SHELLY RIGGS GUNTER, WILLIAM J. DANIEL, LISA A. WRIGHT, JANIE I. DANIEL, DOUGLAS KEITH BELLIS, KRISTINA MARIE BELLIS, KRISTINA FEEZOR, ROBERT FEEZOR, LOUISE JUDGE, RUTH CHAMBERS, JESSICA ANN SHUFORD, CHARLES ENLOE, KIM ENLOE, STEPHEN CRAIG MABREY, CYRUS HAINES, JEFFREY CARLSON, EDWARD TAYLOR, ABIGAIL TAYLOR, BRENTON VENA, ANNE LANGSTON, SARAH SUZANNE MOORE, GREGORY FITTER, GENE K. RINER, MARK WAGNER, DANIEL RYAN, NICOLE CROWSON, DAVID BERRY, QUINCIA BERRY, CODY SWINSON, CLINT SWINSON, GERRY E. GRIFFITH, THOMAS R. RUTLEDGE, JANELLE RUTLEDGE, DAVID ALVIN MOORE, JR., MICHAEL LEARY, JERRY EVANS, JONATHAN G BOGGS, ADAM BAKER, WAYNE BATES, CARLA BATES, MICHELLE SUMMERS, CHRISTINE COOPER, LEONARD COOPER, ANTHONY VERNON RIPLEY, DAWN NICOLE RIPLEY, WAYNE BALES, CARLA BALES and MARY MARTIN, Plaintiffs/Appellees, v. OKLAHOMA TURNPIKE AUTHORITY, an agency of the State of Oklahoma, Defendant/Appellant, and E. GENE LOVE, in his official capacity; JOHN D. JONES, in his official capacity; DANA WEBER, in her official capacity; TODD A. CONE, in his official capacity; WILL L. BERRY, in his official capacity; JOHN A. TITSWORTH, in his official capacity; and, TIMOTHY GATZ, in this official capacity, Defendants. ON APPEAL FROM THE DISTRICT COURT OF CLEVELAND COUNTY HONORABLE TIMOTHY L. OLSON, TRIAL JUDGE ¶0 A group of landowners filed a petition for declaratory judgment and injunctive relief, claiming that the Oklahoma Turnpike Authority violated the Open Meeting Act, 25 O.S.2021, §§ 301 to 314, regarding its notice to the public of the ACCESS Oklahoma Program. Both parties sought summary judgment. The district court rendered summary judgment in the landowners' favor, finding that the Oklahoma Turnpike Authority willfully violated the Open Meeting Act. We retained Oklahoma Turnpike Authority's appeal. We hold that the Oklahoma Turnpike Authority gave sufficient notice of the agenda items that the landowners challenge. We further rule that the lack of notice regarding the announcement of the ACCESS Oklahoma Program at the February 2022 meeting did not violate the Open Meeting Act because the announcement was for informational purposes only. DISTRICT COURT'S JUDGMENT REVERSED AND CAUSE REMANDED WITH INSTRUCTIONS TO GRANT SUMMARY JUDGMENT IN FAVOR OF APPELLANT. Phillip G. Whaley and Grant M. Lucky, Ryan Whaley, Oklahoma City, Oklahoma, for Appellant. Stanley M. Ward, Noble, Oklahoma, for Appellees. Richard C. Labarthe and Alexey Tarasov, Labarthe & Tarasov, Oklahoma City Oklahoma, for Appellees. Winchester, J. ¶1 Appellees, a group of residents and landowners who claim they will be adversely affected by the construction of one of the proposed new turnpikes (the South Extension1) under the ACCESS2 Oklahoma Program (ACCESS Program), brought their claims against the Oklahoma Turnpike Authority (OTA) in the Cleveland County District Court for violations of the Open Meeting Act (OMA), 25 O.S.2021, §§ 301 to 314. Appellees alleged that the OTA violated the OMA by not providing sufficient or timely notice of the new proposed turnpikes in either the January 2022 or February 2022 agendas. Appellees specifically challenged Agenda Items 884, 885, and 894 in the January 25, 2022 regular board meeting agenda as not identifying with specificity which "turnpike projects" the contracts involved. Appellees challenged Agenda Items 906, 908, and 909 in the February 22, 2022 regular board meeting agenda for not providing sufficient notice of the proposed South Extension. Appellees also challenged the lack of notice in the February 22, 2022 meeting agenda of Governor Kevin Stitt's announcement of the ACCESS Program. Appellees requested that the district court invalidate these specific agenda items as willful violations of the OMA and any subsequent actions related to those two items. They also requested that the district court enjoin the OTA from exercising its power of eminent domain over Appellees' properties until the OTA complied with the OMA. Both parties moved for summary judgment. The district court granted Appellees' motion, invalidating the actions taken by the OTA in approving Agenda Items 884, 885, and 894 during the January 25, 2022 regular board meeting and Agenda Items 906, 908, and 909 during the February 22, 2022 regular board meeting. The district court also granted declaratory relief, finding the OTA violated the OMA by announcing the ACCESS Program at the February 22, 2022 regular board meeting without giving notice of the announcement in the OTA's meeting agenda. The district court further ruled that although the lack of notice was violative of the OMA, the OTA did not take any action requiring invalidation. OTA appealed. This Court retained the appeal. ¶2 The issues for the Court to determine are whether the OTA complied with the statutory notice requirements of the OMA concerning the actions the OTA's Board of Directors (Board) took on six agenda items from its January and February 2022 regular meetings and whether the OTA violated the OMA concerning the announcement of the ACCESS Program. We hold that the OTA gave sufficient notice of the actions it took on the six challenged agenda items, as each agenda item provided notice of the subject matter of the business that the Board transacted. We further rule that the announcement of the ACCESS Program at the February 2022 meeting was for informational purposes only. Because no action was taken by the Board at the February 2022 meeting regarding the ACCESS Program and sufficient notice was given for the actions taken at the June 2022 special meeting regarding the ACCESS Program, the OMA did not require that the OTA give more specific notice of the announcement regarding the ACCESS project during the Director's Report. BACKGROUND ¶3 During the OTA's December 2021 regular board meeting, the OTA confirmed that it was seeking to develop the "most robust long-range plan in its history," which included a discussion regarding the need to gather details to determine the viability of projects, conceptual designs, and funding options. The OTA also published a press release the same day, which stated that the OTA plans to hire consultants and additional professional services to vet the details and start conceptual design plans during the upcoming year. The OTA did not set out any specifics regarding any proposed turnpikes or routes. The next month, the OTA issued notice and posted its agenda for its January 25, 2022 meeting, including three challenged provisions: ITEM 884 Consider, take action and vote for the approval or disapproval of a Resolution authorizing a bank revolving line of credit or other short-term bank loans or letters of credit ("Bank Facilities") in support of commercial paper in a principal amount NTE $200 million to provide interim financing of certain turnpike projects. -- Finance/Revenue Division ITEM 885 Consider, take action and vote for the approval or disapproval of a Resolution authorizing the Director to submit an application to the Council of Bond Oversight for provisional and final approval of the interim financing of certain turnpike projects -- Finance/Revenue Division ITEM 894 Consider, take action and vote for the approval or disapproval of the following Program Management Contract -- Engineering Division Project No. Consultant Amount Fund 1. SP-65 Poe & Associates NTE $4,960,000.00 Gen. Program Management Services Long-Range Turnpike Improvement and Expansion Program ¶4 The OTA presented each item in the January meeting, and the Board voted unanimously to approve each item. The next month, the OTA issued notice and posted its agenda for its February 22, 2022 meeting, including three challenged provisions: ITEM 906 Consider, take action and vote for the approval or disapproval of the following Professional Design Services Contracts for ACCESS Bond Program -- Engineering Division: Consultant Amount Fund 1. Benham NTE $5,000,000.00 GEN 2. CEC NTE $5,000,000.00 GEN 3. Cowan NTE $5,000,000.00 GEN 4. CP&Y NTE $5,000,000.00 GEN 5. EST NTE $5,000,000.00 GEN 6. Garver NTE $5,000,000.00 GEN 7. MacArthur NTE $5,000,000.00 GEN 8. MKEC NTE $5,000,000.00 GEN 9. Olsson NTE $5,000,000.00 GEN 10. Poe & Associates NTE $5,000,000.00 GEN 11. TAG NTE $5,000,000.00 GEN 12. TEIM NTE $5,000,000.00 GEN ITEM 908 Consider, take action and vote for the approval or disapproval of the following Right-of-Way Management Contract(s) for ACCESS Bond Program and Capital Program -- Right of Way & Utility Division: Project No. Consultant Amount Fund 1. SP-66 Poe & Associates NTE $2,000,000.00 GEN ROW Management Services Various Turnpikes ITEM 909 Consider, take action and vote for the approval or disapproval of the following Utility Management Contract(s) for ACCESS Bond Program and Capital Program -- Right of Way & Utility Division Project No. Consultant Amount Fund 1. SP-67 TEIM Design NTE $2,000,000.00 GEN Utility Management Services Various Turnpikes ¶5 The OTA presented each item in the February 2022 meeting, and the Board voted unanimously to approve each item. In its final item of the meeting, Governor Kevin Stitt, an ex-officio member of the OTA, announced the ACCESS Program, including the three proposed new turnpikes, noting one of the new proposed turnpikes would run from Purcell to the Kickapoo Turnpike (the South Extension). The next day, The Oklahoman and other news sources reported on the three proposed new turnpikes (the East-West Connector, Tri-City Connector, and South Extension) and the new turnpikes' proposed routes. The OTA also published the proposed routes on the ACCESS Program website. No item on the February 22, 2022 agenda mentioned the announcement of the ACCESS Program. However, the minutes for the February 22, 2022 meeting summarized the announcement under the Director's Report. The Board took no action regarding the ACCESS Program after the announcement. STANDARD OF REVIEW ¶6 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the district court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. The Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. The issues in this case involve the interpretation of the OMA, which is also a question of law subject to de novo review. Head v. McCracken, 2004 OK 84, ¶ 4, 102 P.3d 670, 674; Fulsom v. Fulsom, 2003 OK 96, ¶ 2, 81 P.3d 652, 654. ANALYSIS ¶7 The OTA, as a public trust, is subject to the OMA. 69 O.S.2021, § 1705 ("All meetings of the Authority shall be open public meetings."). The OMA's stated public policy is to "encourage and facilitate an informed citizenry's understanding of the governmental processes and governmental problems." 25 O.S.2021, § 302. In furtherance of this policy, at least 24 hours prior to a regular meeting or a special meeting, a public body is required to display public notice of a meeting, setting the date, time, place, and agenda for the meeting. 25 O.S.2021, § 311(A)(9) and (12). ¶8 The OMA requires that meeting agendas "identify all items of business to be transacted by a public body at a meeting." Id. § 311(B)(1) (emphasis added). The agenda must use "plain language, directly stating the purpose of the meeting," and the language used should be "'simple, direct and comprehensible to a person of ordinary education and intelligence.'" Andrews v. Indep. Sch. Dist. No. 29 of Cleveland Cty., 1987 OK 40, ¶ 7, 737 P.2d 929, 931 (approving Haworth Bd. of Educ. of Indep. Sch. Dist. No. I-6, McCurtain Cty. v. Havens, 1981 OK CIV APP 56, ¶ 9, 637 P.2d 902, 904). The Court must construe the OMA "liberally in favor of the public." Int'l Ass'n of Firefighters, Local 2479 v. Thorpe, 1981 OK 95, ¶ 17, 632 P.2d 408, 411; see also Lafalier v. Lead-Impacted Cmtys. Relocation Assistance Tr., 2010 OK 48, ¶ 37, 237 P.3d 181, 195. However, the Court cannot interpret the OMA to be "so exacting as to interfere with the ability of public bodies to freely conduct business." Fraternal Order of Police v. City of Norman, 2021 OK 20, ¶ 7, 489 P.3d at 27 (Rowe, V.C.J., concurring). ¶9 This Court has analyzed the sufficiency of a public body's notice in its agenda, comparing the agenda item description with the action taken to determine whether the public body provided sufficient notice. See Fraternal Order of Police, 2021 OK 20, ¶¶ 17-18, 489 P.3d 20, 26. We concluded that a public body violated the OMA's notice requirements when it exceeded the scope of the action defined by the notice or when the action contemplated other matters not noted in an existing agenda item. Id. Specifically, in Fraternal Order of Police, we held that the public body's notice was insufficient when the agenda stated that the public body would consider and take action to approve or disapprove a budget attached to the notice when instead, the public body amended and then approved the attached budget. Id. The Court explained that the public body violated the OMA because it gave no notice of reallocating resources or amending the budget. Instead, the agenda only gave notice that the public body would take action to adopt or reject the proposed budget. Id.3 ¶10 We now turn to the specific agenda items challenged by Appellees to determine whether each of the agenda items provided notice of the subject matter of the business the Board transacted. I. The challenged agenda items from the January and February 2022 meetings did not violate the OMA. ¶11 As to Agenda Items 884 and 885 on the January 2022 meeting agenda, the OTA first contends that there is no actual, justiciable controversy as to these items because in June 2022, the OTA terminated the Wells Fargo Line of Credit entered into pursuant to the Board's approval of Agenda Items 884 and 885. In other words, the OTA claims there is no Board action to invalidate. However, the harm under the OMA is when there is a "lack of proper notice and agenda[,] which are crucial to the act."4 Subsequent events attempting to ratify a violation will not cure the violation or "breathe life" into the prior illegal action.5 Even if the OTA terminated the line of credit, such action by the OTA does not cure a violation of the OMA if the OTA failed to give proper notice of an action taken by the Board regarding these specific agenda items. ¶12 Agenda Items 884 and 885 informed the public that the Finance/Revenue Division would submit to the Board a Resolution for consideration and action on a request for one or more short-term loans not to exceed $2,000,000.00 to be used for "certain turnpike projects." Appellees complained that the OTA did not specify what "turnpike projects" the short-term loans involved, specifically whether the financing was for the construction of the South Extension. As pointed out by the OTA, the term "turnpike projects" is a term defined6 and used within the Enabling Act that authorizes the OTA "to construct, maintain, repair, and operate turnpike projects" and to issue turnpike revenue bonds to pay the cost of such projects. 69 O.S.2021, §§ 1701 and 1705(e). The OTA similarly uses the term and ascribes the same meaning as prescribed by the Legislature. Further, the OTA included with the agenda a copy of the Resolution to be considered by the Board. The Resolution did not identify any specific turnpikes; importantly, it referred to interim financing for "turnpike projects," which is what the OTA specified in the agenda item. The Board considered and approved the Resolution, without any modifications, additions, or amendments. ¶13 Similarly, Agenda Item 894 for the January 2022 meeting informed the public that the Engineering Division would submit to the Board a consulting engineering services contract for consideration and action. The scope of the contract was to hire an engineering design firm that would begin the process of developing design, final plans, specifications, and construction for the "long-range turnpike improvement and expansion program," which the OTA eventually announced as the ACCESS Program in its February 2022 meeting. Appellees again complained that the OTA did not specify what turnpikes were involved in the "long-range turnpike improvement and expansion program." The contract was not for the construction of a specific component of any turnpike project, and the contract did not reference any specific turnpike project. The contract was instead for "Program Management Services," which is what was specified in the agenda item. The Board considered and took action only on the contract expressly stated in the agenda, without any modifications, additions, or amendments. ¶14 Agenda Items 906, 908, and 909 from the February 2022 meeting reflect that the Board was to consider various design, right of way, and utility management contracts for the "ACCESS Bond Program and Capital Program." Appellees do not specify how the OTA allegedly violated the OMA regarding these agenda items. However, we presume that they again have taken issue with the lack of specificity as to whether these contracts involve the construction of the South Extension. The Board again considered and took action only on the contract expressly stated in the agenda, and the Board's approval did not include a contract for a specific component of any turnpike project. ¶15 The level of specificity demanded by Appellees in the agenda items is not required by the OMA. Appellees contend that the OTA should have used the words "South Extension" (or some similar variation) to give notice that the proposed turnpike was going to be constructed as part of the ACCESS Program. However, these items of business dealt with several turnpike projects on a larger scale than the possible construction or proposed route of the South Extension. Instead, the business transacted was to obtain interim financing to fund the continued planning activities of the OTA's operations, approval of a consulting engineering services contract, and various design, right-of-way, and utility management contracts to develop the ACCESS Program, which involved not only the development of three new turnpikes but also other projects throughout Oklahoma to improve current turnpikes and their infrastructure. The only actions the Board took were to consider and approve these construction, engineering, and service contracts, as set out in the January and February 2022 agenda items. Each challenged agenda item satisfies the OMA's statutory notice requirements. ¶16 Further, the Board's approval of the challenged agenda items did not authorize the proposed route of the South Extension, the construction of the South Extension, or the taking of Appellees' property for the construction of the South Extension. Instead, the Board authorized the issuance of bonds for the construction of the South Extension and the proposed route at the OTA's Special Meeting held on June 9, 2022. Appellees do not challenge the OTA's notice in relation to any agenda items from the June 9, 2022 meeting, including those items that authorized the construction and route for the South Extension. II. The lack of notice in the agenda regarding the announcement of the ACCESS Program did not violate the OMA. ¶17 The OTA also did not violate the OMA when Governor Stitt announced the ACCESS Program during the Director's Report section of the February 2022 meeting. The OMA requires that meeting agendas identify "all items of business to be transacted by a public body at a meeting." 25 O.S.2021, § 311(B)(1) (emphasis added). The remedy for a violation of the OMA notice requirements is to invalidate the action taken by officials. See 25 O.S.2021, § 313 ("Any action taken in willful violation of this act shall be invalid."); see also Bailey v. State ex rel. Bd. of Tests for Alcohol and Drug Influence, 2022 OK 50, ¶ 37, 510 P.3d 845, 589 (holding that the OMA requires a willful violation to invalidate the action of officials). To violate the OMA notice requirements, the agenda item at issue must have some action taken by the public body to transact business. An opinion by the Office of the Attorney General reached a similar conclusion: "Business," not having been defined in the Open Meeting Act, must be given a construction in consonance with the ordinary meaning of the term and in harmony with the purposes of the Open Meeting Act; and as stated, supra, a liberal interpretation must be indulged. Business should be assumed to include the entire decision-making process including deliberation, decision or formal action. Question Submitted by: The Honorable David L. Moss, District Attorney, Tulsa County, 1982 OK AG 212, ¶ 3. ¶18 When Governor Stitt announced the ACCESS Program during the Director's Report, the Board did not transact any business during the presentation or as a result of the presentation. The Board did not engage in any deliberation or decision-making or take any action after the Governor's announcement. The presentation was merely an informational announcement, and under the OMA, the OTA did not need to specify the presentation on its agenda within the Director's Report. ¶19 In a similar case, a school board published an agenda for the regular board meeting, noting the superintendent would make his report and recommendations concerning an increase in academic requirements. Andrews, 1987 OK 40, 737 P.2d 929. The superintendent presented at the meeting his recommendation to increase the minimum number of credits for graduation and to increase the eligibility requirements for activities participation. The parents challenged the school board's notice of the superintendent's report, asserting that the notice was insufficient because it did not specify that the superintendent would discuss the issue of increasing academic requirements for activity participation. Id. ¶ 8, 737 P.2d at 931. We held that the notice was sufficient in that the OMA does not require the content of a report by a superintendent or any recommendations to be published in full prior to presenting the report to the board. Further, we ruled that because the issue of increasing these requirements was on the agenda for subsequent meetings in plain language, there was no violation of the OMA. Id. The agenda item regarding the superintendent's report contained broad language that afforded the school board flexibility in what could be discussed and acted upon at the meeting. Fraternal Order of Police, 2021 OK 20, ¶ 8, 489 P.3d at 27 (Rowe, V.C.J., concurring). ¶20 The same result as in Andrews should follow here. We note that the OTA has a "Reports" section at the end of its agenda for its regular monthly meetings. During this part of the meeting, several different divisions give reports, i.e., an operations report, a consulting engineer report, a highway patrol report, and a director's report. Rarely is the substance of these reports listed in the agenda because the presentations are for informational purposes only. ¶21 The Governor's informational announcement of the ACCESS Program occurred during the Director's Report. The OTA did not request that any action be considered by its board with respect to the announcement of the ACCESS Program. The next day, the information presented in the meeting was made public through various news sources and on the OTA's own ACCESS Oklahoma website, which included the preliminary locations and alignments for the specific projects. The OTA also hosted several public meetings regarding the proposed routes for the new turnpikes after the announcement. As in Andrews, the public was given notice of the subsequent meeting where the Board took action regarding the ACCESS Program--over 3 months after the initial announcement of the ACCESS Program and after a series of public meetings to discuss the ACCESS Program. During the OTA's special meeting on June 9, 2022, the Board approved: (1) the issuance of revenue bonds to finance or refinance all or a portion of the capital costs of the ACCESS Program; (2) a resolution directing the OTA to file an application to this Court for the validation of bonds; (3) the termination of the Wells Fargo Line of Credit dated May 17, 2022, to provide interim financing for the improvement of certain turnpike projects, including those projects identified in the ACCESS Oklahoma program; and (4) the route alignments published to the OTA's ACCESS Program website on February 22, 2022. Appellees did not challenge any agenda item for the actions taken during the June 9, 2022 meeting, specifically where the South Extension was officially proposed and approved by the Board. ¶22 When in doubt, it is always a better practice for public bodies to post in the meeting agenda the substance of an informational presentation. Such practice avoids challenges to a public body's compliance with the OMA. However, we are mindful that the purpose of board meetings is not only for the public bodies to take action but also to allow board members to ask questions and engage in informational discussions. We find no violation of the OMA when Governor Stitt announced the ACCESS Program during the Director's Report section of the February 2022 meeting. III. This Court has the exclusive jurisdiction to consider the relief requested by Appellees. ¶23 We note that Appellees' request for relief through this declaratory action is to prevent the OTA from exercising its eminent domain to construct the proposed South Extension. The challenged agenda items and even the announcement of the ACCESS Program do not relate to any action by the Board to take Appellees' property for the construction of the proposed turnpikes. Appellees agree in that they admit that invalidating the challenged agenda items would only amount to a setback in the OTA's efforts to construct the proposed turnpikes and not give the conclusive relief Appellees seek. This is because the Legislature conferred upon the Court "exclusive original jurisdiction" to determine the validity of proposed bonds to construct and operate turnpikes. 69 O.S.2021, § 1718. This Court has construed the Legislature's grant of jurisdiction as giving the Court sole authority to determine all questions of sufficiency of the law to authorize bonds and construct turnpikes. Okla. Tpk. Auth. v. Dist. Court of Lincoln Cty., 1950 OK 147, ¶ 11, 222 P.2d 514, 518. The Court must consider the validity of the bonds, the constitutionality of the bonds, and the OTA's authority to construct and operate turnpikes. Id. ¶ 6, 222 P.2d at 517. This Court gained exclusive jurisdiction to consider the relief requested by Appellees--to prevent the OTA from exercising its eminent domain to construct the proposed South Extension--when the OTA filed its application to validate the proposed bonds. In fact, many of the Appellees have filed a protest, placing the authority of the OTA to construct the proposed turnpikes at issue in the bond validation matter. Any future construction of the South Extension will hinge upon determinations made by this Court in the bond validation matter. Since exclusive jurisdiction belongs to this Court, the district court should never have considered Appellees' claims for relief. In the future, proceedings related to bond validation matters must be brought in this Court. CONCLUSION ¶24 The OTA gave sufficient notice of the actions it took on the six agenda items challenged by Appellees, as the items provided notice of the subject matter of the business that was transacted as to each item. We further rule that the announcement of the ACCESS Program at the February 2022 meeting was for informational purposes only. Because no action was taken by the Board at the February 2022 meeting regarding the ACCESS Program, the OMA did not require that the OTA give more specific notice of the announcement regarding the ACCESS project during the Director's Report. The district court's order granting summary judgment in favor of Appellees is reversed and the cause is remanded with instructions for the district court to grant summary judgment in favor of the OTA. DISTRICT COURT'S JUDGMENT REVERSED AND CAUSE REMANDED WITH INSTRUCTIONS TO GRANT SUMMARY JUDGMENT IN FAVOR OF APPELLANT. CONCUR: KANE, C.J., KAUGER, WINCHESTER, EDMONDSON AND DARBY, J.J. DISSENT: ROWE, V.C.J. (BY SEPARATE WRITING), GURICH AND KUEHN, J.J. NOT PARTICIPATING: COMBS, J. FOOTNOTES 1 The ACCESS Oklahoma Program involves the construction of three proposed turnpikes and other projects to improve current turnpikes and their infrastructure. The three proposed turnpikes are 1) the Tri-City Connector, running around the west side of the Will Rogers World Airport to I-44; 2) the East-West Connector, connecting the H.E. Bailey Turnpike around Newcastle heading east on Indian Hills Road to the south of Draper Lake, then heading northeast connecting to the Kickapoo Turnpike and completing the Oklahoma City Outer Loop (Loop); and 3) the South Extension, running from I-35 west of Slaughterville and north of Purcell, across the South Canadian River and north through Norman, west of Thunderbird Lake, connecting with the East-West Connector. 2 ACCESS stands for "Advancing and Connecting Communities and Economies Safely Statewide." 3 Similarly, the Court of Civil Appeals (COCA) has decided this issue as well. In Wilson v. City of Tecumseh, 2008 OK CIV APP 84, 194 P.3d 140, COCA held an agenda item for the public body's regular meeting was insufficient. The agenda item stated the board would consider the employment, hiring, and resignation of an employee. Instead, the public body approved a $30,0000 bonus for the employee. COCA found the agenda did not directly state the purpose of the meeting. Id. ¶ 11, 194 P.3d at 144. In Havens, 1981 OK CIV APP 56, 637 P.2d 902, COCA ruled an agenda item for the public body's special meeting was insufficient. The agenda item stated that the purpose of the meeting was to appoint a new board member, interview a new administrator, and hire principals. Id. ¶ 6, 637 P.2d at 904. The board instead hired a superintendent. Id. ¶ 1, 637 P.2d at 903. COCA held that the board's action materially exceeded its announced purpose and intention. The agenda specifically limited the actions to be taken by the board, and the hiring of a superintendent was not one of those items. Id. ¶ 11, 637 P.2d. at 904. 4 Wilson, 2008 OK CIV APP 84, 194 P.3d 140, ¶ 21, 194 P.3d at 146. 5 In re Declaring Annexation Dated June 28, 1978, Issued by Frazier, 1981 OK CIV APP 57, ¶ 23, 637 P.2d 1270, 1274. 6 Title 69 O.S.2021, § 1704(2) defines turnpike project as follows: "Project" or "turnpike project" means any express highways, superhighways, or motorways, wayports, aviation transfer centers or aviation hubs constructed under the provisions of this article by the Authority, and shall embrace all bridges, tunnels, overpasses, underpasses, interchanges, entrance plazas, approaches, free access roads, bridges, and road construction, toll houses, service stations, and administration, storage and other buildings which the Authority may deem necessary for the operation of such turnpike, together with all property, rights, easements and interests which may be acquired by the Authority for the construction or the operation of such turnpike. The Authority may contract or lease concessions for gas stations, garages, restaurants, parking facilities and other services for all or any portion of any turnpike project or projects. 69 O.S.2021, § 1704(2). ROWE, V.C.J., with whom GURICH and KUEHN, JJ., join, dissenting: ¶1 The express purpose of the Open Meeting Act (the "OMA"), is to "encourage and facilitate an informed citizenry's understanding of the governmental processes and governmental problems." 25 O.S. § 302. Public bodies subject to the OMA must comply with its express requirements, one of which is that all meetings must be preceded by advance public notice specifying the time and place of the meeting as well as the subject matter or matters to be considered at such meeting. Id. at § 303. The information regarding matters to be considered at the meeting are included on an agenda, which may be posted in view at the public bodies' office or meeting place and/or on the internet. Id. § 311(9)(a)(b). All posted agendas "shall identify all items of business to be transacted by a public body at a meeting. . . ." Id. at § 311(B)(1). ¶2 Our jurisprudence instructs that the "agenda shall 'be worded in plain language, directly stating the purpose of the meeting . . . [and] the language used should be simple, direct and comprehensible to a person of ordinary education and intelligence.'" Andrews v. Indep. Sch. Dist. No. 29 of Cleveland Cty., 1987 OK 40, ¶ 7, 737 P.2d 929, 931 (alterations in original) (quoting Haworth Bd. of Educ. of Indep. Sch. Dist. No. I-6, McCurtain Cty. v. Havens, 1981 OK CIV APP 56, ¶ 9, 637 P.2d 902, 904). Pertinent to the case before us, the policy of the OMA "is defeated if the required notice is deceptively worded or materially obscures the stated purpose of the meeting." Fraternal Ord. of Police, Bratcher/Miner Mem'l Lodge, Lodge No. 122 v. City of Norman, 2021 OK 20, ¶ 9, 489 P.3d 20, 24 quoting Haworth, 1981 OK CIV APP 56, ¶ 8, 637 P.2d at 904. ¶3 The OMA provides that any action taken in willful violation of the act is invalid. 25 O.S. § 313. Willfulness does not require a showing of bad faith, malice, or wantonness, but rather, encompasses conscious, purposeful violations of the law or blatant or deliberate disregard of the law by those who know, or should know the requirements of the Act. Notice of meetings of public bodies which are deceptively vague and likely to mislead constitute a wilful violation. Rogers v. Excise Bd. of Greer Cty., 1984 OK 95, ¶ 14, 701 P.2d 754, 761. THE CHALLENGED AGENDA ITEMS FROM THE JANUARY 25, 2022 AND FEBRUARY 22, 2022 AGENDAS VIOLATED THE OPEN MEETING ACT. ¶4 Prior to December 7, 2021, the Oklahoma Turnpike Authority ("OTA") had not approved or even publicly discussed ACCESS Oklahoma.1 (The OTA is a legal entity consisting of the Governor, as a member ex officio, and six members appointed by the Governor and approved by the Senate).2 At its December 7 meeting, Oklahoma Secretary of Transportation and OTA Executive Director Timothy Gatz announced the OTA sought to develop its "most robust long-range plan in history."3 However, Secretary Gatz failed to elaborate as to what the OTA's long-range plan encompassed or reference the plan's future name. ¶5 The minutes of the December 7, 2021 OTA meeting state that "more information about the long-range plan can be found in the Authority's Press Release dated December 7, 2021."4 According to the press release, the OTA's "long-range plan" included: Improvements to help alleviate traffic on I-35 and I-44 as well as statements from several elected officials, including Newcastle Mayor Karl Nail who said that the long range plan "won't just impact Newcastle but will impact the entire state."5 ¶6 On its January 25, 2022 agenda, the OTA used the deceptive phrases "certain turnpike projects" and "long-range improvement and expansion program" to materially obscure what was already internally known as ACCESS Oklahoma. In fact, the press release reflects that Secretary Gatz's announcement on December 7, 2021 of the OTA's "most robust long-range plan in history" was indeed a cryptic reference to ACCESS Oklahoma. ¶7 Subsequently, at the OTA's February 22, 2022 meeting, the OTA approved a series of contracts relating to an "ACCESS Bond Program." Yet again the OTA adhered to its pattern of obscurity by failing to reveal to the public what the program entailed or what "ACCESS" meant on its published agenda.6 It was not until the end of the February meeting--after its implementation was funded and its management contracts were approved during the January and February meetings7--that ACCESS Oklahoma was unveiled to the public. Governor Stitt joined the meeting and officially unveiled the "most robust long-range plan in history"8 as ACCESS Oklahoma--a five billion dollar turnpike project that would span fifteen years and affect the lives of thousands of Oklahomans. ¶8 The majority finds the "level of specificity demanded by the Appellees in the agenda items is not required by the OMA."9 The majority's attenuated interpretation of the OMA as applied to the facts of this case defeats the Act's purpose. The issue is not whether the language used on the January 25, 2022 and February 22, 2022 Agendas met the statute's level of specificity--the issue is whether the OTA used deceptive wording to delay revealing to the public a project that was already well-known and well-underway within the OTA. By approving its creation and funding using the deceptive phrases "certain turnpike projects," "long-range improvement and expansion program," and "ACCESS Bond Program," ACCESS Oklahoma was presented to the public as a fait accompli. ¶9 The OTA created ACCESS Oklahoma, approved management contracts, and sought funding for its implementation--all while using deceptively worded agendas to obscure the purpose of the meetings and circumvent public participation. This participation by the public is precisely what the OMA seeks to guarantee. The actions of the OTA thwarted our state's public policy of encouraging and facilitating an informed citizenry's understanding and participation in the governmental process. As such, the OTA's actions constituted a willful violation of the Open Meeting Act. OUR EXCLUSIVE JURISDICTION TO APPROVE BOND APPLICATIONS DOES NOT DIVEST THE TRIAL COURT OF OPEN MEETING ACT CLAIMS. ¶10 The OMA is one of the most consequential statutory enactments our state has adopted in an effort to promote the public's right to know what its government is doing and for what purpose public funds are expended. Our state constitution declares that all political power in this state is vested in the people.10 The objective of the OMA protects this guaranteed, constitutional right. ¶11 While the majority is correct that the Legislature has conferred upon this Court exclusive jurisdiction to determine the validity of bond applications, this Court's exclusive jurisdiction does not divest the trial court from determining whether an OMA violation occurred. The majority cites Oklahoma Turnpike Authority v. District Court of Lincoln County, 1950 OK 147, 222 P.2d 514 to support its finding that Plaintiffs' OMA claims fall within our exclusive jurisdiction. In OTA v. District Court of Lincoln County, we held that "this Court has jurisdiction to consider all questions raised by the plaintiffs in the action in the district court of Lincoln County, in so far as they concern the constitutionality of the law, and the sufficiency of the law to authorize petitioners herein to sell the bonds and construct the turnpike." ¶ 11, 222 P.2d at 518 (emphasis added). Our holding in 1950 is consistent with our holding in Pike Off OTA, Inc. et al., v. Oklahoma Turnpike Authority, 2023 OK 57, to which we affirmed that this Court has exclusive jurisdiction over any claims challenging the OTA's authority to construct proposed turnpikes. ¶12 Contrary to the cases above, Plaintiffs' OMA claims do not challenge the OTA's authority to construct the proposed turnpikes in ACCESS Oklahoma. Rather, Plaintiffs' OMA claims challenge whether the OTA conducted its meetings in accordance with state law. As such, Plaintiffs' claims do not fall within our exclusive jurisdiction, nor does our precedent suggest otherwise. Title 69 O.S. § 1718 cannot be construed to create a vacuum which subsumes any collateral issue concerning how the OTA conducts business into our exclusive jurisdiction. To interpret § 1718 as such will deprive plaintiffs the right to parse out separate legal questions that necessitate the trial court. ¶13 The majority's finding that Plaintiffs' alleged OMA violations should morph into the OTA's bond application before this Court would completely deny Plaintiffs of their opportunity to fully litigate the alleged violations. The question of whether the OTA complied with OMA requirements is a separate legal question where the trial court must ascertain findings of fact. The Supreme Court does not conduct trials--nor are we situated to make findings of fact. Without the ability to fully litigate the alleged violations in a trial or hearing, the Open Meeting Act is gutted. Accordingly, I cannot join in today's pronouncement which I view as an infringement on the people's right to legitimately challenge an Open Meeting Act violation. I respectfully dissent. FOOTNOTES 1 "ACCESS" stands for "Advancing and Connecting Communities and Economies Safely Statewide." 2 69 O.S. § 1703(B). 3 Pls' MSJ Ex. C, 22. 4 Id. 5 OTA press release dated December 7, 2021, https://oklahoma.gov/content/dam/ok/en/ota/documents/news-articles/2021/OTA%20Press%20Release%20-%20December%207,%202021.pdf. 6 Item 906 on the February 22, 2022 Agenda was the first time the acronym "ACCESS" was used publicly. However, it was not until the end of the February 22, 2022 meeting that the public learned what "ACCESS" meant when it was announced by Governor Stitt. 7 On February 22, 2022 the Oklahoma Turnpike Authority published a press release that summarized the Governor's announcement of ACCESS Oklahoma and stated in part "The board hired Poe & Associates, an Oklahoma City-based engineering consultant, during the January 2022 board meeting to provide program management services for ACCESS Oklahoma's long-range plan projects." Pls' MSJ Ex. G, 55. 8 Pls' MSJ Ex. C, 22. 9 Majority Op. ¶ 15 10 Okla. Const. Art. 2 § 1.

c80f6a98-f102-4d78-94b2-151e1912500c

In the Matter of the Estate of Parker

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ESTATE OF PARKER2023 OK 50Case Number: 119871Decided: 05/02/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE ESTATE OF RONALD W. PARKER, DECEASED. HERMAN PARKER, Petitioner/Appellant,v.MANDY ALLFORD AND SHILA PIRPICH Respondents/Appellees. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III, ON APPEALFROM THE DISTRICT COURT OF PITTSBURG COUNTY, STATE OF OKLAHOMA, HONORABLE MICHAEL W. HOGAN ¶0 A dispute over the disposition of deceased individual's estate arose between the Decedent's adult children and his brother. Decedent left a holographic will, which the parties stipulated was valid. A provision in the will conferred a specific bequest of an expected worker's compensation settlement to Decedent's brother. After reviewing pleadings submitted by the parties and stipulations, the trial court determined the decedent's holographic failed to intentionally omit his adult children, and therefore, they were deemed pretermitted heirs by operation of law. Additionally, the lower court concluded that as pretermitted heirs, the daughters were entitled to an intestate share of Decedent's estate pursuant to 84 O.S.2011, § 132. Finally, the trial judge found that 84 O.S.2011, § 133 did not apply to the facts of this case. The Court of Civil Appeals, Division III affirmed the lower court's decision and we granted certiorari to examine the interplay between 84 O.S.2011, § 132 and 84 O.S.2011, § 133. TRIAL COURT ORDER REVERSED; OPINION FROM THE COURT OF CIVIL APPEALS IS VACATED AND THE MATTERIS REMANDED FOR PROCEEDINGSCONSISTENT WITH THIS OPINION. BRETT D. CABLE, CABLE LAW, PLLC, MCALESTER, OKLAHOMA, PETITIONER/APPELLANT HERMAN PARKER JASON L. GLASS, TARA D. ZICKEFOOSE, BAUM CLASS JAYNE CARWILE & PETERS, TULSA, OKLAHOMA, PETITIONER/APPELLANT HERMAN PARKER MICHAEL W. BOUTOT, TULSA, OKLAHOMA, RESPONDENTS/APPELLEES MANDY ALLFORD AND SHILA PIRPICH GURICH, J. Facts & Procedural History ¶1 Ronald W. Parker (Decedent) died on April 3, 2020, as a resident of Pittsburg County. He left behind two adult daughters, Mandy Allford and Shila Pirpich, and a brother, Herman Parker (Herman). A little more than one-year before Decedent's death, he executed a holographic will (Will), which stated in its entirety: I Ronald W. Parker off [sic] sound mind & mind coharant [sic] relising [sic] that I almost have had multilable [sic] hardatcts [sic] & strokes, duetest [sic] that I more than owe my bro Herman what I will recieve [sic] in my settlement from my workers comp upon my death wish it to be given to him.1 Ronald W. Parker March 5, 2019 The workers' compensation settlement (Settlement) referenced in the Will was an anticipated future payment worth more than $850,000.00. Not addressed in the Will was the residue of Decedent's estate, which included a Gulf Stream travel trailer and a 2001 Ford F-150 truck, with a combined worth of approximately $14,294.00. The Will made no mention of Decedent's daughters. ¶2 Allford and Pirpich filed a petition for letters of administration on April 17, 2020. In response, Herman filed a combined motion to dismiss daughters' petition and petition to admit Decedent's holographic will to probate. The trial court consolidated the probate and administration cases on June 17, 2020, and decided that the Settlement should be held in trust until the court ordered otherwise. The validity of the holographic will is not disputed. ¶3 Three issues were presented to the trial court for determination: (1) whether Allford and Pirpich were pretermitted heirs; (2) if so, what share of the estate they should receive; and (3) whether the specific bequest to Herman was exempt from or included in the intestate shares Allford and Pirpich would be entitled to as pretermitted. The material facts of the case were based on the parties' stipulations.2 The daughters maintained that they are pretermitted heirs of the estate because the Decedent unintentionally omitted them from the Will; and as a result, they are entitled to an intestate share of the Decedent's assets. In contrast, Herman claimed that Allford and Pirpich are not pretermitted heirs, and even if they are, they should not be entitled to any share of the Settlement because Oklahoma law exempts specific bequests if apportionment from such bequest(s) would defeat the obvious intention of a testator. ¶4 On September 8, 2021, the trial court issued a ruling on the above-referenced issues. Therein, the trial judge concluded the daughters are pretermitted heirs due to their unintentional omission from the Will. With respect to the parties' respective shares of the estate, the trial court determined: A closer look at section 133 reveals this portion of the statute addresses a child born after the making of a will or to a child or the issue of a child omitted in a will. The statute does not mention a situation involving an heir other than a child as in this case. Even the heading of the statute refers to a child born or omitted from a will. Did the legislature intend for the statute to extend to other heirs and not just to the children of a decedent? * * * * The Court is of the opinion section 132 is the applicable statute. The Court is further of the opinion section 133 is inapplicable, as there are no omitted children or after born children. Thus, the holographic will is ineffective as a transfer of the workers' compensation award to the decedent's brother. The daughters are pretermitted heirs and not otherwise omitted by the terms of the will.3 Herman timely appealed the ruling and the matter was assigned to the Court of Civil Appeals. The COCA affirmed the trial court order on March 24, 2022. Herman sought review in this Court, and we granted certiorari to examine a matter of first impression, namely the statutory interplay between 84 O.S.2011, §§ 132 and 133. Standard of Review ¶5 To assess the propriety of the trial court's ruling in this case, we must analyze the precise wording and relationship between two statutes: 84 O.S.2011, § 132 and 84 O.S.2011, § 133. Questions concerning statutory interpretation are subject to this Court's de novo review. Christian v. Christian, 2018 OK 91, ¶ 5, 434 P.3d 941, 942. In exercising de novo review, "this court possesses plenary, independent, and non-deferential authority to examine the issues presented." Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. ¶6 When the Court conducts an examination of statutory enactments, our primary goal is to determine legislative intent through the "plain and ordinary meaning" of the statutory language. Kohler v. Chambers, 2019 OK 2, ¶ 6, 435 P.3d 109, 111. We will only employ rules of statutory construction when legislative intent cannot be ascertained (e.g., in cases of ambiguity). Christian, ¶ 5, 434 P.3d at 942. Our test for determining if a statute contains an ambiguity is whether its language is susceptible to more than one meaning. Id., ¶ 5, 434 P.3d at 942-43. Analysis ¶7 On certiorari, Herman does not contest the trial court's finding that Allford and Pirpich are pretermitted heirs. Rather, his sole contention is the trial judge misinterpreted 84 O.S.2011, § 133 by limiting its application to "situations where there is at least one lineal descendant who was not omitted from the will."4 Herman further maintains that § 133 should be interpreted broadly and that by its plain meaning the section merely explains how to fund intestate shares for pretermitted heirs when a will provides for specific bequests. He advocates a three-step process under § 133: (1) the trial court should allocate shares for pretermitted heirs out of that portion of the estate not disposed of by will; (2) shares must be apportioned by taking from all devisees and legatees in proportion to the value they would receive under the will; and finally (3) the lower court must ascertain whether funding pretermitted heir(s) share(s) from a specific bequest would defeat a testator's obvious intent; if so, the trial court must make a different apportionment consistent with that intent. In contrast, Allford and Pirpich maintain § 133 is not triggered in this case because it does not apply to specific bequests earmarked for non-lineal descendants. ¶8 First we must examine the precise language of the two pertinent statutory provisions. Title 84 O.S.2011, § 132 reads: When any testator omits to provide in his will for any of his children, or for the issue of any deceased child unless it appears that such omission was intentional, such child, or the issue of such child, must have the same share in the estate of the testator, as if he had died intestate, and succeeds thereto as provided in the preceding section.5 Therefore, as pretermitted heirs, Allford and Pirpich are entitled an intestate share of the estate, unless their omission was intentional. There is nothing in the Decedent's Will or record to suggest his daughters' omission was intentional. See Rogers v. Pratt, 2020 OK 27, ¶ 18, 467 P.3d 651, 655 (noting words in a will must demonstrate an intent to omit a child either by name or class, or other language within the four corners of the document indicating an intentional act to exclude children). Thus, reading § 132 in isolation would vest Allford and Pirpich with a right to receive one-half of Decedent's estate. 84 O.S.2011, § 213(B)(2)(a).6 However, this does not end our inquiry because we must consider the applicability of § 133. ¶9 Section 133 is clearly intended to modify § 132 as it provides for the specific manner of allocating estate assets to satisfy an award to pretermitted heirs. In fact, the title of the statutory provision reads, "Determination of Share Assigned to Afterborn or Omitted Child." Additionally, the section allows for the exemption or apportionment of specific bequests when including them in an award to a pretermitted heir would defeat a testator's obvious intent: When any share of the estate of a testator is assigned to a child born after the making of a will, or to a child, or the issue of a child, omitted in a will as hereinbefore mentioned, the same must first be taken from the estate not disposed of by the will, if any; if that is not sufficient, so much as may be necessary must be taken from all the devisees, or legatees, in proportion to the value they may respectively receive under the will, unless the obvious intention of the testator in relation to some specific devise or bequest or other provision in the will, would thereby be defeated; in such case such specific devise, legacy or provision may be exempted from such apportionment, and a different apportionment, consistent with the intention of the testator, may be adopted. 84 O.S.2011, § 133. Concluding that § 133 was inapplicable to the present case, the Court of Civil Appeals opined that under its plain language, "[§ 133] is only applicable to make up a pretermitted child's interstate [sic] share when there are lineal decedents [sic] of the decedent (i.e., issue) that were not omitted from the will and, if applicable, a surviving spouse."7 However, nothing in the statute calls for such an interpretation or limits its application to cases where a will includes one lineal descendant but omits one or more children. ¶10 To interpret § 133, we must breakdown each clause of the statute. The initial passage refers to an intestate share "assigned" to a pretermitted heir "as hereinbefore mentioned," ostensibly referring back to an intestate award under §§ 131 or 132. While a share is initially determined under § 132 by reference to 84 O.S.2011 § 213, such distribution is then limited by the express language in § 133. A pretermitted heir's share must first be taken from that portion of the "estate not disposed of by the will. . ." 84 O.S.2011, § 133. If the residuary estate is insufficient to satisfy a pretermitted heir's intestate portion, sums "must be taken from all the devisees, or legatees, in proportion to the value they may respectively receive under the will. . ." to satisfy the pretermitted heir's share. Id. However, the critical language ignored by the trial court and the COCA provides that shares be allocated from devisees and legatees,8 "unless the obvious intention of the testator in relation to some specific devise or bequest or other provision in the will, would thereby be defeated." Id (emphasis added). Such specific bequest(s)9 may be exempted from apportionment among the pretermitted heirs, and the trial court may approve a different apportionment consistent with the testator's intent. Id. ¶11 Decedent's will was admitted to probate without objection. Both Allford and Pirpich are clearly pretermitted heirs, as they were not mentioned in the holographic will. Thus, as a baseline, the two daughters would be entitled to one-half of the entire estate under 84 O.S.2011, §§ 132 and 213(B) (2) (a). However, § 133 requires us to determine how those shares are funded from Decedent's estate. The trial judge and COCA erroneously concluded that § 133 was inapplicable to this case; however, the statute clearly applies. Nowhere does the language of or title of § 133 limit its application to scenarios where a will includes one or more children but unintentionally excludes other children. It applies to determine the manner of funding intestate shares in any case where there are pretermitted heirs. Further, a devisee or legatee may include lineal descendants (children, grandchildren, etc.), non-family members, charities or any number of beneficiaries. The section does not qualify who receives a specific bequest. Thus, to fund pretermitted shares, § 133 requires apportionment out of gifts to any devisee and legatee, unless including a specific bequest in such apportionment would directly contravene the intention of the testator. ¶12 Decedent's will, the validity of which is not disputed, included a specific bequest to his brother with an explanation of why he wanted the workers' compensation settlement to be payable directly to Herman. Decedent's obvious intent was to provide his brother with the Settlement funds. Thus, the exception in § 133 for a specific bequest is applicable under the facts of this case. Consequently, it was error for the trial court to find § 133 inapplicable under the facts presented in this case. Nevertheless, because Decedent's residuary estate is de minimis, awarding one-hundred percent of Decedent's workers' compensation settlement to Herman, would also effectively render §§ 131 and 132 meaningless. To remedy this kind of unique situation, the last clause in § 133 allows a trial court to adopt a different apportionment that would be consistent with the testator's intent. We believe that to give full effect to all of the relevant statutes, the matter should be remanded for the trial judge to consider the appropriate estate division in light of §133. Conclusion ¶13 As noted, nothing in § 133 limits its application to those cases in which a will provides for one or more lineal descendants or a surviving spouse. It broadly applies to apportionment of shares payable to pretermitted heirs from all devisees and/or legatees. The terms lineal descendant are never mentioned in § 133. To interpret the relevant statutes as the trial court and the COCA did would render Decedent's will and § 133 meaningless. However, awarding almost the entirety of Decedent's estate to Herman would also eviscerate the purpose of the pretermitted heir statutes. Thus, we hold § 132 and § 133 are both applicable to the facts of this case. The trial court must now determine the proper manner of apportioning the pretermitted shares awarded to Allford and Pirpich, while still recognizing the testator's intent to provide a specific bequest to his brother. TRIAL COURT ORDER REVERSED; OPINION FROM THE COURT OF CIVIL APPEALS IS VACATED AND THE MATTERIS REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. KAUGER (by separate writing), WINCHESTER, EDMONDSON, COMBS, GURICH, and DARBY, JJ., CONCUR. KANE, C.J., ROWE, V.C.J (by separate writing), and KUEHN, J., DISSENT. FOOTNOTES 1 Holographic Will of Ronald W. Parker, O.R. (PB-2020-68) at 7. 2 Initially, Allford and Pirpich challenged the validity of the holographic will but, apparently, conceded it complied with the requirements of 84 O.S. 2011, § 54. The parties allegedly entered into an agreed order on May 2, 2021, setting forth stipulated facts necessary for the trial judge to dispose of the pending disputes. Inexplicably, this order was not included in the record on appeal. The parties filed two separate pretrial conference orders; the daughters' submission contained a provision acknowledging that the Decedent left a will entirely written, dated and signed by him. For purposes of this appeal, we presume the holographic will to be valid. This is also consistent with the trial judge's September 9, 2021 order. 3 Order of September 9, 2021, O.R. (PB-2020-55) at 3-4. 4 Pet. For Certiorari, p. 4. (internal quotations omitted). 5 84 O.S.2011, § 131 provides: Whenever a testator has a child born after the making of his will, either in his lifetime or after his death, and dies leaving such child unprovided for by any settlement, and neither provided for nor in any way mentioned in his will, the child succeeds to the same portion of the testator's real and personal property that he would have succeeded to if the testator had died intestate. 6 84 O.S.2011, § 213(B)(2)(a) reads: B. Beginning July 1, 1985, if any person having title to any estate not otherwise limited by any antenuptial marriage contract dies without disposing of the estate by will, such estate descends and shall be distributed in the following manner: * * * *2. The share of the estate not passing to the surviving spouse or if there is no surviving spouse, the estate is to be distributed as follows: a. in undivided equal shares to the surviving children of the decedent and issue of any deceased child of the decedent by right of representation, or 7 COCA Opinion ¶ 16, pp. 9-10 (emphasis in original). 8 A devisee is "[a] recipient of property by will; esp., someone who receives real estate by testamentary gift." Black's Law Dictionary (11th ed. 2019). A legatee is defined as "[s]omeone who is named in a will to take personal property; one who has received a legacy or bequest." Black's Law Dictionary (11th ed. 2019). 9 Bequests are defined as "[t]he act of giving property (usu. personal property or money) by will. 2. The money or other property that a person arranges to give to someone or an organization upon death; esp., property (usu. personal property or money) disposed of in a will." Black's Law Dictionary (11th ed. 2019). ROWE, V.C.J., with whom KANE, C.J., and KUEHN, J., join, dissenting: ¶1 The guarantees delineated to an omitted or pretermitted child by §§ 131 and 132 are extended mutatis mutandis by § 133--not abrogated thereby. ¶2 I read 84 O.S.2021 §§ 131 and 132 in harmony with § 133 to give full meaning and effect to each provision. Interpreting § 133 in isolation leads to an absurd conclusion. Toch, LLC v. City of Tulsa, 2020 OK 81, ¶ 29, 474 P.3d 859, 868 ("Courts should not interpret statutes to mean something the legislature did not intend or express, especially where the resulting interpretation is absurd in light of the Act as a whole.") As §§ 131 and 132 are mandatory and § 133 is not, I find the trial court was correct in its analysis and conclusion. ¶3 Sections 131 and 132 mandate that an afterborn child or a pretermitted child shall receive the same share in the estate of the testator as if the testator had died intestate. In accordance, § 133 permits a specific bequest so long as it can be accomplished in satisfaction of §§ 131 and 132. For instance, if an unmarried decedent bequeathed his grand piano to child A by will and unintentionally omitted child B from his will, § 133 would support the specific bequest of the grand piano to child A, so long as a sufficient residue from the estate allowed child B to receive one-half by value of the estate, as required by § 132. ¶4 Section 132 states that children unintentionally omitted from a will must receive the same share in the estate of the testator as if the testator had died intestate. Per the intestacy statute, 84 O.S.2021, § 213(B)(2)(a), the testator's daughters are each entitled to one-half of the testator's entire estate. To the contrary, if § 133 were applied as the majority holds, § 132 would be functionally meaningless, allowing the testator's brother, a nonlineal descendant, to receive the bulk of the estate. Read in harmony with §§ 131 and 132, § 133 cannot apply to a specific bequest to a collateral heir. ¶5 Here, the specific bequest to the testator's brother cannot be accomplished in satisfaction of § 132. The majority's holding prevents the testator's daughters from receiving what they are explicitly entitled to receive per § 132. Accordingly, I respectfully dissent. KAUGER, J., concurring specially: ¶1 I concur in remanding the matter to the trial court for an equitable division of the estate. However, I write separately to point out that 84 O.S. 2011 §133 is a specific equitable statute governing the precise matter in controversy -- whether the specific bequest is included in the intestate shares of the estate. When ascertaining legislative intent, relevant provisions of a statutory scheme are considered together in an attempt to give force and effect to each provision.1 However, when a special statute clearly includes the matter in controversy, the special statute controls over a statute of general applicability.2 ¶2 While 84 O.S. 2011 §133 is part of the general statutory scheme governing the Execution and Revocation of Wills, 84 O.S. 2011 §§1 et al., it is a specific provision addressing what happens when a specific bequest is made to a named person and heirs are also pretermitted. It provides: When any share of the estate of a testator is assigned to a child born after the making of a will, or to a child, or the issue of a child, omitted in a will as hereinbefore mentioned, the same must first be taken from the estate not disposed of by the will, if any; if that is not sufficient, so much as may be necessary must be taken from all the devisees, or legatees, in proportion to the value they may respectively receive under the will, unless the obvious intention of the testator in relation to some specific devise or bequest or other provision in the will, would thereby be defeated; in such case such specific devise, legacy or provision may be exempted from such apportionment, and a different apportionment, consistent with the intention of the testator, may be adopted. ¶3 In other words: 1) when a testator's share of the estate is assigned to an omitted child, their share is taken from the estate not disposed of by the will, or if it is insufficient, then from the other devisees or legatees; unless 2) the obvious intent of the testator was to make a specific bequest, and that specific bequest would be defeated. If such a specific bequest is made, and would be defeated, then that bequest is exempted from apportionment, and an apportionment is to be made following the intent of the testator. ¶4 In this cause, the testator made a specific bequest from a specific workers compensation award to a specific person. He stated in his holographic will: I Ronald W. Parker off [sic] sound mind & mind coharant [sic] relising [sic] that I almost have had multiable [sic] hardatcts [sic] & strokes, duetest [sic] that I more than owe by bro Herman what I will receive [sic] in my settlement from my workers comp upon my death wish it to be given to him. Under §133, the obvious intent of the testator was to make a specific bequest. If the specific bequest would thereby be defeated, it may be exempted from such apportionment, and a different apportionment, consistent with the intention of the testator, may be adopted. ¶5 In my view one of two things must happen, both of which end with the same result. Either the specific bequest is excluded from the estate, and given to the named person consistent with the testator's intent, with the estate divided among the pretermitted heirs; or the specific bequest is included in the estate, but given to the named person consistent with the testator's intent, with the remainder of the state divided among the pretermitted heirs. ¶6 In this cause, the majority merely applies a portion of the last sentence of the statute, by making a "different apportionment," but totally ignoring the testator's intent. If he had said "I want my brother to have the painting that I bought on our trip to Santa Fe. Because we had such a good time on that trip, I want him to remember it" there would be no problem interpreting the statute. Apparently, it is the amount of the specific bequest that troubles the majority. FOOTNOTES 1 Davis v. GHS Health Maintenance Organization, Inc., 2001 OK 3, ¶10, 22 P.3d 1204; Ashby v. Harris, 1996 OK 7, ¶11, 918 P.2d 744; Haney v. State, 1993 OK 41, ¶5, 850 P.2d 1087. 2 Davis v. GHS Health Maintenance Organization, Inc., see note 1, supra; Tulsa County Deputy Sheriff's Fraternal Order of Police, Lodge No. 188 v. Board of County Comm'rs of Tulsa County, 1998 OK 44, ¶13, 959 P.2d 979; Carter v. City of Oklahoma City, 1993 OK 134, ¶11, 862 P.2d 1987.

6d6b9ca8-67ca-4337-ad5c-db51e01b785e

Schlumberger Technology Corp. v. Travelers Indemnity Co. of America

oklahoma

Oklahoma Supreme Court

SCHLUMBERGER TECHNOLOGY CORP. v. TRAVELERS INDEMNITY CO. OF AMERICA2023 OK 42Case Number: 120197Decided: 04/18/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. SCHLUMBERGER TECHNOLOGY CORP. and TRAVELERS INDEMNITY CO. OF AMERICA, Petitioners,v.ERASMO PAREDES and THE WORKERS' COMPENSATION COMMISSION, Respondents. ON PETITION FOR REVIEW OF AN ORDER OFTHE WORKERS' COMPENSATION COMMISSION ¶0 Petitioners Schlumberger Technology Corp. and Travelers Indemnity Co. of America seek review of an order of the Workers' Compensation Commission finding Respondent Erasmo Paredes's claim was timely filed and not barred by the statute of limitations. Paredes filed the claim less than one year from the date of the injury but more than six months after the date of the last payment of benefits. The Workers' Compensation Commission determined that Paredes was not barred from filing his claim. We affirm. ORDER OF THE WORKERS' COMPENSATION COMMISSION IS AFFIRMED. Loretta A. Jones, Ayik & Associates, Oklahoma City, Oklahoma, for Petitioners Schlumberger Technology Corp. and Travelers Indemnity Co. of America. Bob Burke, Joey Chiaf, Oklahoma City, Oklahoma, for Respondent Erasmo Paredes. Gurich, J.: Facts & Procedural History ¶1 Erasmo Paredes sustained an on-the-job injury on December 29, 2019. He continued working for his employer, Schlumberger, until January 30, 2020. His employer's insurance carrier, Travelers Indemnity Company of America, provided voluntary medical treatment to Paredes from January 3, 2020, through February 14, 2020. Paredes's CC-Form 3 Claim for Compensation was filed on December 3, 2020, alleging an injury date of December 29, 2019. This claim was filed ten months after Paredes's last medical treatment, but within one year from the date of his injury. Travelers's counsel entered an appearance in the Workers' Compensation case on December 22, 2020. On February 18, 2021, the affidavit of Travelers's claims handler was filed with attachments indicating Travelers provided medical treatment to Paredes in the total amount of $1,371.47. No disability benefits were paid. On the same date, counsel for Travelers filed the CC-Form 10 Answer and Notice of Contested Issues on behalf of Schlumberger raising the defense of statute of limitations pursuant to Section 69(A)(1) of Title 85 A. 1 Schlumberger also denied compensable injuries, alleged pre-existing conditions pursuant to 85A O.S. Supp. 2019, § 2(9)(b)(6), and denied benefits. ¶2 A hearing solely on the issue of the statute of limitations defense was held before an administrative law judge on April 29, 2021. Prior to the hearing, both parties submitted trial briefs. The ALJ issued an order that was filed on May 13, 2021, concluding that Paredes's claim was not barred by Section 69(A)(1). In the order, the ALJ stated: "It is the Commission's finding that in this case, the word 'or' is used to express alternative statutes of limitations, with claimant receiving the benefit of whichever of those is longer."2 Schlumberger appealed to the Workers' Compensation Commission ("Commission"), and the parties filed written arguments. Oral argument before the Commission was held on January 14, 2022. The Commission, sitting en banc, affirmed the Decision of the ALJ by order filed January 18, 2022.3 Schlumberger has appealed to this Court seeking review of the Commission's interpretation of 85A O.S. Supp. 2019, § 69(A)(1). Standard of Review ¶3 Title 85, Section 78(C) states: The judgment, decision or award of the Commission shall be final and conclusive on all questions within its jurisdiction between the parties unless an action is commenced in the Supreme Court of this state to review the judgment, decision or award within twenty (20) days of being sent to the parties. Any judgment, decision or award made by an administrative law judge shall be stayed until all appeal rights have been waived or exhausted. The Supreme Court may modify, reverse, remand for rehearing, or set aside the judgment or award only if it was: 1. In violation of constitutional provisions;2. In excess of the statutory authority or jurisdiction of the Commission;3. Made on unlawful procedure;4. Affected by other error of law;5. Clearly erroneous in view of the reliable, material, probative and substantial competent evidence;6. Arbitrary or capricious;7. Procured by fraud; or8. Missing findings of fact on issues essential to the decision. 85A O.S. Supp. 2019, § 78(C). The issue presented in this case is an issue of statutory interpretation. Statutory interpretation presents a question of law which we review de novo. Maxwell v. Sprint PCS, 2016 OK 41, ¶ 4, 369 P.3d 1079, 1083. Such review is plenary, independent, and non-deferential. Id. Analysis ¶4 The duties and obligations of employees and employers are set forth in the Administrative Workers' Compensation Act ("AWCA"). Title 85A, Section 3(A) provides: Every employer and every employee, unless otherwise specifically provided in this act, shall be subject and bound to the provisions of the Administrative Workers' Compensation Act and every employer shall pay or provide benefits according to the provisions of this act for the accidental injury or death of an employee arising out of and in the course of his or her employment, without regard to fault for such injury, if the employee's contract of employment was made or if the injury occurred within this state. . . . [T]he employee's right to bring a claim under this act shall be subject to the limitations period for bringing a claim pursuant to paragraph 1 of subsection A of Section 69 of this title. 85A O.S. Supp. 2019, § 3(A). The AWCA also dictates when a claim for workers' compensation benefits must be filed. Title 85A, Section 69 states: A. Time for Filing. 1. A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Workers' Compensation Commission within one (1) year from the date of the injury or, if the employee has received benefits under this title for the injury, six (6) months from the date of the last issuance of such benefits. For purposes of this section, the date of the injury shall be defined as the date an injury is caused by an accident as set forth in paragraph 9 of Section 2 of this title.2. a. A claim for compensation for disability on account of injury which is either an occupational disease or occupational infection shall be barred unless filed with the Commission within two (2) years from the date of the last injurious exposure to the hazards of the disease or infection.b. A claim for compensation for disability on account of silicosis or asbestosis shall be filed with the Commission within one (1) year after the time of disablement, and the disablement shall occur within three (3) years from the date of the last injurious exposure to the hazard of silicosis or asbestosis.c. A claim for compensation for disability on account of a disease condition caused by exposure to X-rays, radioactive substances, or ionizing radiation only shall be filed with the Commission within two (2) years from the date the condition is made known to an employee following examination and diagnosis by a medical doctor.3. A claim for compensation on account of death shall be barred unless filed with the Commission within two (2) years of the date of such a death.4. If a claim for benefits has been timely filed under paragraph 1 of this subsection and the employee does not:a. make a good-faith request for a hearing to resolve a dispute regarding the right to receive benefits, including medical treatment, under this title within six (6) months of the date the claim is filed, orb. receive or seek benefits, including medical treatment, under this title for a period of six (6) months,then on motion by the employer, the claim shall be dismissed with prejudice. B. Failure to File. Failure to file a claim within the period prescribed in subsection A of this section shall not be a bar to the right to benefits hereunder unless objection to the failure is made at the first hearing on the claim in which all parties in interest have been given a reasonable notice and opportunity to be heard by the Commission. C. Persons under Disability.1. Notwithstanding any statute of limitation provided for in this act, when it is established that failure to file a claim by an injured employee or his or her dependents was induced by fraud, the claim may be filed within one (1) year from the time of the discovery of the fraud.2. Subsection A of this section shall not apply to a mental incompetent or minor so long as the person has no guardian or similar legal representative. The limitations prescribed in subsection A of this section shall apply to the mental incompetent or minor from the date of the appointment of a guardian or similar legal representative for that person, and when no guardian or similar representative has been appointed, to a minor on reaching the age of majority. D. A latent injury or condition shall not delay or toll the limitation periods specified in this section. This subsection shall not apply to the limitation period for occupational diseases specified in paragraph 2 of subsection A of this section. 85A O.S. Supp. 2019, § 69. ¶5 Schlumberger asks the Court to construe Section 69(A)(1) to mean that claimant has either one year from the date of injury or six months from the date of the last issuance of benefits, whichever is lesser. Schlumberger admits it made benefit payments without admitting compensability of the claim, gave no notice to Paredes of the last date benefits were paid to a medical provider, and then argues Paredes is prevented from filing his claim within the one year provided in the statute. Paredes asks us to affirm the Commission's construction that a claimant must file within one year from the date of injury or six months from the date of the last issuance of benefits, whichever is greater, recognizing the lack of notice would create potential constitutional issues. I. The Commission's interpretation of Section 69 is consistent with the Legislative intent. a. Legislative history of Section 69. ¶6 To ascertain the legislative intent behind Section 69, we first look at the history of the section to determine if it has a prior statutory construction which may be applicable. If there is a prior construction, "[u]nless a contrary intent clearly appears or is plainly expressed, the terms of amendatory acts retaining the same or substantially similar language as the provisions formerly in force will be accorded the identical construction to that placed upon them by preexisting case law." Maxwell v. Sprint PCS, 2016 OK 41, ¶ 6, 369 P.3d 1079, 1085. ¶7 Here, the Commission's interpretation of Section 69 is consistent with the statutory history. The use of a statute of limitations that could be extended by payment of benefits has been included in the workers' compensation statutes since at least 1941 and has survived several transitions of the workers' compensation system.4 In 1941, Title 85, Section 43 stated: The right to claim compensation under this Act shall be forever barred unless within one year after the injury a claim for compensation thereunder shall be filed with the commission. Provided, however, claims may be filed any time within one year from the date of last payment of any compensation or remuneration paid in lieu of compensation. 85 O.S.1941, § 43. In 1981, Title 85, Section 43 contained similar language and provided: The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within one (1) year after the injury or death, a claim for compensation thereunder is filed with the Administrator. Provided, however, claims may be filed at any time within one (1) year from the date of last payment of any compensation or remuneration paid in lieu of compensation or within one (1) year from last authorized medical treatment. 85 O.S.1981, § 43. The text of this statute was amended in 1994 to extend the time to file a claim from one year to two years. In 1994, Section 43(A) provided: The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the last payment of any compensation or remuneration paid in lieu of compensation or medical treatment which was authorized by the employer or the insurance carrier. . . . The filing of any form or report by the employer or insurance carrier shall not toll the above limitations. 85 O.S. Supp. 1994, § 43. Substantially the same language is found in the 19975 and 20016 versions of Section 43. This language was not modified until 2011, when the whole of the existing Title 85 was repealed and re-codified as the Workers' Compensation Code and Section 43 was renumbered as Title 85, Section 318(A): The right to claim compensation under the Workers' Compensation Code shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the date of the last medical treatment authorized by the employer or the insurance carrier or the date of the payment of any compensation or remuneration paid in lieu of compensation. ¶8 When the AWCA was adopted and became effective on February 1, 2014, Title 85 was repealed7 and replaced with Title 85A. Section 69 of Title 85A initially had two provisions that applied to injuries and reduced the statute of limitations to one year, as follows: A. Time for Filing. 1. A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Commission within one (1) year from the date of the injury. If during the one-year period following the filing of the claim the employee receives no weekly benefit compensation and receives no medical treatment resulting from the alleged injury, the claim shall be barred thereafter. For purposes of this section, the date of the injury shall be defined as the date an injury is caused by an accident as set forth in paragraph 9 of Section 2 of this act. . . . .B. Time for Filing Additional Compensation. 1. In cases in which any compensation, including disability or medical, has been paid on account of injury, a claim for additional compensation shall be barred unless filed with the Commission within one (1) year from the date of the last payment of disability compensation or two (2) years from the date of the injury, whichever is greater. 85A O.S. Supp. 2013, § 69(A)(1), (B)(1). Paragraph A provided that an employee had one year from the date of the injury to file the claim. It also stated that if an employee received no weekly benefit or medical treatment during a one-year period following the filling of the claim, the claim was barred. Paragraph B provided that in cases where any disability or medical compensation had been paid (but prior to filing the claim), claims for additional compensation had to be made within one year from the date of the last payment of compensation or two years from the date of the injury.8 ¶9 In 2019, the Legislature revised Section 69 and consolidated subsections A and B, which each contained a statute of limitation, into a single subsection (A).9 During the legislative process, the words "whichever is greater" were stricken from the final version, and the statute was enacted without the phrase.10 Schlumberger argues that the removal of the phrase created two distinctly different periods of limitation: one clearly defined limitation that runs one year from the date of injury and one based entirely on the actions of the employer, in this case, Schlumberger.11 ¶10 Even though Section 69 did not contain the phrase "whichever is greater" prior to 2014, the specified statute of limitations could be extended by payment of benefits by the employer. The statute of limitations was never shortened based on payment of benefits by the employer.12 During oral argument before the Commission, Commissioner Tilly succinctly framed the issue by posing the following questions: Isn't it pretty standard statutory interpretation that where the legislature provides t[w]o statute of limitations, the filing party gets the benefit of the longer of the two statute of limitations? So I understand your argument that the legislature left out "whatever is greater" in the statute, but isn't there a presumption that the legislature is familiar with the rules of statutory interpretation and so even if they left out "whatever is greater" that would in some way be superfluous under the standard rules of statutory interpretation, and how do we get around that?13 The Commission's decision applied the statute as intended, which was to give the claimant the benefit of the longer period because of the employer's payment of benefits. Therefore the phrase "whichever is greater" is superfluous. b. Statute of limitations. ¶11 "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by the statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. We must look at the Act as a whole and consider relevant portions together to give full force and effect to each. Id. ¶ 18, 415 P.3d at 528. ¶12 In the case of Smith v. Johnston, 1978 OK 142, 591 P.2d 1260, the Oklahoma Supreme Court considered the purpose of statutes of limitations. They relied upon the case of Seitz v. Jones, 1961 OK 283, ¶ 11, 370 P.2d 300, 302 wherein the Court said: * * * the legislative policy in prescribing a period of limitations for the commencement of actions may well be borne in mind. The statute of limitations is a statute of repose, enacted as a matter of public policy to fix a limit within which an action must be brought, or the obligation is presumed to have been paid, and is intended to run against those who are neglectful of their rights, and who fail to use reasonable and proper diligence in the enforcement thereof. The underlying purpose of statutes of limitations is to prevent the unexpected effort at enforcement of stale claims concerning which persons interested have been thrown off their guard by want of prosecution for a long time. (Emphasis added). The Commission's interpretation of this statute did not give Paredes an unlimited time to file his claim. Paredes filed his claim within one year of his date of injury. He did not "test" this section by filing his claim beyond the initial 12 months. Once filed, his claim must be pursued in a diligent manner. Indeed, Section 69(A)(4) ensures that workers' compensation claims will not become stale, because a filed claim will be dismissed if not actively pursued after 6 months.14 ¶13 There is nothing in the record to indicate that Paredes was neglectful of his right. None of the evidentiary problems that can arise in a stale claim are at issue in this case. Paredes gave notice as required by statute and filed his claim within one year. Nothing is obscured by the passage of time between February 14, 2020, and December 3, 2020. Schlumberger's ability to defend this claim is not hampered. ¶14 Schlumberger's assertion of an absolute time bar--one shortened by the employer without notice to the employee--is further eroded by considering the language in Section 69(B) which provides: Failure to File. Failure to file a claim within the period prescribed in subsection A of this section shall not be a bar to the right to benefits hereunder unless objection to the failure is made at the first hearing on the claim in which all parties in interest have been given a reasonable notice and opportunity to be heard by the Commission. This provision indicates that the statute of limitations is not an absolute time bar. The burden is on the employer to take affirmative action, or arguably, even the one-year statute of limitations will be extended. This provision, which requires not only an objection but also a hearing, would be meaningless if the Commission did not have discretion to adjust the statute of limitations based on the circumstances presented. II. The Commission's interpretation of Section 69 is constitutional. ¶15 This Court's precedent directs that "[w]here there are two possible interpretations in the construction of a statute, one of which would render the statute unconstitutional, the Court should adopt the construction which upholds the statute, unless the repugnancy to the constitution is shown beyond a reasonable doubt." Gilbert Cent. Corp. v. State, 1986 OK 6, ¶ 7, 716 P.2d 654, 658; Gibby v. Hobby Lobby Stores, Inc., 2017 OK 78, 404 P.3d 44 (Gurich, J., dissenting). Further, the Commission has the authority to determine the constitutionality of statutes in cases brought under the AWCA. 85A O.S. Supp. 2019, § 27;15 Robinson v. Fairview Fellowship Home for Senior Citizens, Inc., 2016 OK 42, 371 P.3d 477. Because Section 69 of Title 85A can be interpreted in a way that avoids constitutional doubt, we are bound to accept the interpretation that upholds the provision. ¶16 When read in its entirety, Section 69 provides that persons seeking benefits must file their claim for benefits within one to three years, depending upon the type of underlying injury or illness. The shortest time frame to file is definite: within one year from the date of the injury. An employee whose claim is denied in its entirety has one full year to file the claim. Schlumberger's proposed interpretation shortens the one-year time frame to less than one year only in the case of an employee who receives a payment after an injury is reported to his employer. Schlumberger's construction would infringe on a claimant's right to due process because it would allow the employer and its insurance carrier to determine the statute of limitations for the employee, without notice. Article II, Section 7 of the Oklahoma Constitution provides: "No person shall be deprived of life, liberty, or property, without due process of law." Although the Legislature may "alter private contractual rights of employers and employees when it properly exercises its police power in creating a particular workers' compensation law," the Legislature may not deprive such rights, once conferred, without appropriate procedural safeguards. Maxwell v. Sprint PCS, 2016 OK 41, ¶ 15, 369 P.3d 1079, 1089 (citing Torres v. Seaboard Foods, LLC, 2016 OK 20, ¶ 30, 373 P.3d 1057, 1073) (emphasis added); see also Maxwell, ¶ 19, 369 P.3d at 1090 (At a minimum, "due process requires notice and a meaningful opportunity to appear and be heard." (citing Crownover v. Keel, 2015 OK 35, ¶ 14, 357 P.3d 470, 474)). ¶17 In order to comply with due process, the obligations of the AWCA on both employee and employer begin with notice requirements. To avoid prejudice to the employer in investigating a claim, an employee is required by statute to give notice within 30 days of suffering an on the job injury.16 The employer is required by statute to give notice to the Commission within 10 days of receiving notice of injury.17 However, the employer's report to the Commission remains confidential unless a copy is requested by the injured employee or a claim is filed.18 If Schlumberger paid benefits, as in this case, there is nothing in the statutory law that gives an employee notice of when the claim is barred. The employee is deprived of the one year statute of limitations by the actions of his employer, without notice of the commencement of a shortened statute of limitations. Such deprivation is unconstitutional. ¶18 In this case, the affidavit of the claims handler for Travelers, filed on February 18, 2021, stated that the last benefit payment was paid on February 14, 2020. Paredes had no notice of the date when the statute of limitations began to run until more than one year after his injury. Commissioner Biggs astutely identified the due process concern during oral argument by stating: Well, I mean, my argument is simple, the system works when people know when deadlines are, when the statute of limitations starts, they have 6 months. If they didn't have notice of when your company paid, how do they know when the clock starts? . . . Well the first part is one year. One year is one year, there's no if, ands or buts about it, I mean--.19 Barring Paredes's claim based solely on the actions of the employer and its insurance carrier without Paredes ever having notice of when the statute of limitations runs, clearly violates due process.20 Conclusion ¶19 The Commission applied the law as to not offend constitutional provisions and it is the duty of this Court to give preference to that interpretation. The Order of the Commission is hereby affirmed. ORDER OF THE WORKERS' COMPENSATION COMMISSION IS AFFIRMED. ROWE, V.C.J., KAUGER, EDMONDSON, COMBS, GURICH, and DARBY, JJ., CONCUR. KANE, C.J., (by separate writing), KUEHN, J., and DOWNING, S.J., DISSENT. WINCHESTER, J., DISQUALIFIED. FOOTNOTES 1 Schlumberger was represented by its insurance carrier, Travelers. All filings in this case were made by counsel for Travelers who represented both Schlumberger and Travelers. For purposes of this opinion when "Schlumberger" is referenced going forward, it is referencing both Schlumberger and Travelers. 2 R. at 23. 3 R. at 55. 4 The workers' compensation system has seen significant changes over the years. The first workers' compensation laws were enacted in 1915 and workers' compensation claims were under the jurisdiction of the State Industrial Commission until 1959. Oklahoma Workers' Compensation Court of Existing Claims, http://www.owcc.state.ok.us/History.htm#:~:text=The%20Oklahoma%20Legislature%20enacted%20the%20state%E2%80%99s%20first%20law,covered%20employment%20without%20the%20burden%20of%20proving%20negligence. (last visited Mar. 3, 2023). In 1959, the Legislature replaced the Commission with the State Industrial Court. Id. In 1978, the Legislature replaced the Industrial Court with the Workers' Compensation Court. Id. In 2014, the Legislature replaced the Workers' Compensation Court with the Workers' Compensation Commission, though it provided that any claims prior to 2014 should stay under the jurisdiction of the Workers' Compensation Code and its Court. See 85A O.S. Supp. 2019, § 3(A). 5 85 O.S. Supp. 1997, § 43(A) states: The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the last payment of any compensation or remuneration paid in lieu of compensation or medical treatment which was authorized by the employer or the insurance carrier.... The filing of any form or report by the employer or insurance carrier shall not toll the above limitations. 6 85 O.S.2001, § 43(A) states: The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the last payment of any compensation or remuneration paid in lieu of compensation or medical treatment which was authorized by the employer or the insurance carrier.... The filing of any form or report by the employer or insurance carrier shall not toll the above limitations. 7 Three sections in title 85 appear to be unaffected by the repeal: §§ 380, 398 & 399. The Rules of the Workers' Compensation Court effective January 31, 2014 remain applicable to claims before February 1, 2014 and are found at Chapter 4, Appendix to Title 85. 8 This statute was changed because it created confusion because of the use of the words "filing for additional compensation." These two paragraphs were combined into the shortened version, which became effective May 28, 2019. Ans. Br. of Resp't 11--12. 9 Compare 85A O.S. Supp. 2014, § 69(A)--(B) with 85A O.S. Supp. 2019, § 69(A)(1) (which states: "A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Workers' Compensation Commission within one (1) year from the date of the injury or, if the employee has received benefits under this title for the injury, six (6) months from the date of the last issuance of such benefits. For purposes of this section, the date of the injury shall be defined as the date an injury is caused by an accident as set forth in paragraph 9 of Section 2 of this title.") 10 HB 2367; Pet'r's Br. in Chief 5. 11 Id. 4--5. 12 Similarly, the language "compliance with reporting requirements by the employer did not toll the statute of limitations" was later removed, but it is doubtful that the change was intended to discourage the employer from complying with reporting requirements. 13 Appeal Hr'g Tr. 9--10, Jan. 14, 2022. 14 85A O.S. Supp. 2019, § 69(4) states: If a claim for benefits has been timely filed under paragraph 1 of this subsection and the employee does not: (a) make a good-faith request for a hearing to resolve a dispute regarding the right to receive benefits, including medical treatment, under this title within six (6), or (b) receive or seek benefits, including medical treatment, under this title for a period of six (6) months, then on motion by the employer, the claim shall be dismissed with prejudice. 15 85A O.S. Supp. 2019, § 27(A) provides: The Workers' Compensation Commission shall be vested with jurisdiction over all claims filed pursuant to the Administrative Workers' Compensation Act. All claims so filed shall be heard by the administrative law judge sitting without a jury. The Commission shall have full power and authority to determine all questions in relation to claims for compensation under the provisions of the Administrative Workers' Compensation Act. The Commission, upon application of either party, shall order a hearing. Upon a hearing, either party may present evidence and be represented by counsel. Except as provided in this act, the decision of the administrative law judge shall be final as to all questions of fact and law. The decision of the administrative law judge shall be issued within thirty (30) days following the submission of the case by the parties. The power and jurisdiction of the Commission over each case shall be continuing and it may, from time to time, make such modifications or changes with respect to former findings or orders relating thereto if, in its opinion, it may be justified. 16 See 85A O.S. Supp. 2014, § 68(A), which states: "Unless an employee gives oral or written notice to the employer within thirty (30) days of the date an injury occurs, the rebuttable presumption shall be that the injury was not work-related. Such presumption must be overcome by a preponderance of the evidence." 17 85A OS Supp. 2019, § 63(A) states: Within ten (10) days after the date of receipt of notice or of knowledge of injury or death, the employer shall send to the Workers' Compensation Commission a report setting forth: 1. The name, address, and business of the employer;2. The name, address, and occupation of the employee;3. The cause and nature of the injury or death;4. The year, month, day, approximately when, and the particular locality where, the injury or death occurred; and5. Such other information as the Commission may require. 18 There is no indication in the record that this report was ever given to Paredes. 19 Appeal Hr'g Tr. 16, Jan. 14, 2022. 20 Paredes asserts that Schlumberger's interpretation creates an impermissible, unequal, disparate treatment of a select group of injured workers and would render Section 69(A)(1) a special law in violation of the Oklahoma Constitution. As we have decided the issue on other grounds, we need not address this issue. See Fent v. Fallin, 2013 OK 107, ¶ 7 n.1, 315 P.3d 1023, 1025 (the Court found that because HB 2032 violated the single subject rule, the Court did not need to address Petitioner's remaining arguments). KANE, C.J., with whom Kuehn, J. and Downing, S.J. join, dissenting: ¶1 The majority has disregarded the clear and unambiguous statutory language and substituted its own wisdom for that of the Legislature. The Legislature deleted the words "whichever is greater" from the statute. Yet, the majority concludes the Legislature intended that the statute of limitations is either one year from the date of the injury or six months from the date of the last issuance of benefits, "whichever is greater." For the following reasons, I respectfully dissent. ¶2 I must, first, clarify the standard of review. While the Workers' Compensation Commission has authority to interpret workers' compensation statutes, this Court does not give any deference to the Commission's interpretation. The Supreme Court may modify, reverse, remand for rehearing, or set aside the Commission's decision if it is affected by an error of law. See 85A O.S.Supp.2019, § 78(C)(4). Statutory interpretation presents a question of law, which appellate courts review de novo. See Legarde-Bober v. Okla. State Univ., 2016 OK 78, ¶ 5, 378 P.3d 562, 564. Such review is plenary, independent, and non-deferential. Id. ¶3 I disagree with how the majority frames the issue on appeal. The majority asserts: "Schlumberger asks the Court to construe Section 69(A)(1) to mean that claimant has either one year from the date of the injury or six months from the date of the last issuance of benefits, whichever is lesser." Majority Op. ¶ 5 (emphasis original). More accurately, the issue is whether the limitations period for an employee who has received benefits is six months from the date of the last issuance of such benefits, even if the resulting limitations period is less than one year from the date of the injury.1 The answer is provided in the clear and unambiguous language of the statute, without any need to employ rules of statutory construction.2 The relevant statutory language provides: A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Workers' Compensation Commission within one (1) year from the date of the injury or, if the employee has received benefits under this title for the injury, six (6) months from the date of the last issuance of such benefits. 85A O.S.Supp.2019, § 69(A)(1) (emphasis added). The statutory language is not susceptible to more than one interpretation. If the employee has not received benefits for the injury, the statute of limitations is one year from the date of the injury. If the employee has received benefits for the injury, the statute of limitations is six months from the date of the last issuance of such benefits.3 Period. ¶4 The majority's thorough recitation of the legislative history of the workers' compensation statute of limitations cuts directly against its own interpretation of 85A O.S.Supp.2019, § 69(A)(1). I agree with the majority that the Oklahoma Legislature has a long history of providing alternative statutes of limitations with the employee receiving the benefit of whichever is longer--but that changed in 2019. I am puzzled by the majority's acknowledgement that "[u]nless a contrary intent clearly appears or is plainly expressed, the terms of amendatory acts retaining the same or substantially similar language as the provisions formerly in force will be accorded the identical construction to that placed upon them by preexisting case law," Majority Op. ¶ 6, but refusal to acknowledge the clear legislative intent to alter the law. Prior to 2019, every iteration of the statute of limitations included the language "[p]rovided however" or "whichever is greater," which had the effect of giving employees who had received benefits a longer limitations period.4 The former statute of limitations provided: In cases in which any compensation, including disability or medical, has been paid on account of injury, a claim for additional compensation shall be barred unless filed with the Commission within one (1) year from the date of the last payment of disability compensation or two (2) years from the date of the injury, whichever is greater. 85A O.S.Supp.2013, § 69(B)(1) (emphasis added). The plain language of the former statute was clear--the employee could take advantage of whichever limitations period was longer, and that was how this Court construed and applied the statute. See Green Country Physical Therapy L.P. v. Sylvester, 2018 OK CIV APP 64, 429 P.3d 354 (approved for publication by the Supreme Court) (holding a claim filed more than two years from the date of the injury but within one year of the last provision of medical treatment was timely). ¶5 If a former statute is clear or its meaning has been judicially determined, legislative amendment may reasonably indicate a legislative intent to alter the law. Special Indem. Fund v. Figgins, 1992 OK 59, ¶ 8, 831 P.2d 1379, 1382. In 2019, the Oklahoma Legislature amended § 69 by reducing both limitations periods and deleting the language "whichever is greater." See 2019 Okla. Sess. Laws, 1st Reg. Sess., ch. 476, § 27 (effective May 28, 2019). The statute of limitations now provides: A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Workers' Compensation Commission within one (1) year from the date of the injury or, if the employee has received benefits under this title for the injury, six (6) months from the date of the last issuance of such benefits. 85A O.S.Supp.2019, § 69(A)(1) (emphasis added). The 2019 amendments did not retain "whichever is greater" or similar language from the provisions formerly in force and which had been construed as giving the employee the benefit of whichever limitations period was longer. In fact, the amendatory act did the exact opposite--it deleted the pertinent language "whichever is greater." How can the Legislature's intent to alter the law be more plainly expressed? The majority's conclusion that the Legislature intended that the employee receive the benefit of whichever limitations period is most favorable goes against the clear and unambiguous language of the statute and requires the Court to read "whichever is greater" back into the provision, which we should not do. The "court is duty-bound to give effect to legislative acts, not amend, repeal or circumvent them." Fulsom v. Fulsom, 2003 OK 96, ¶ 7, 81 P.3d 652, 655. "A universally recognized principle in cases when a court is called on to interpret legislative enactments is that the court is without authority to rewrite a statute merely because the legislation does not comport with the court's conception of prudent public policy." Id. ¶6 Based on the plain and ordinary meaning of the words and the structure of the sentence, it seems clear to me the legislative intent is that the one-year limitation period does not apply when an employee has received benefits. Rather, when the employee has received benefits for the injury, the statute of limitations is six months from the date of the last issuance of benefits--even if the resulting limitations period is less than one year from the date of the injury. ¶7 In its due process analysis, the majority takes issue with the employer and its insurance carrier having control over the length of the statute of limitations based on whether the employer provides benefits and for how long. See Majority Op. ¶¶ 16, 18. However, the majority fails to recognize that the employer has always had this control over the statute of limitations and retains control under the majority's own interpretation of the current statute. Under the former statute, the employer determined the "date of the last payment of disability compensation." 85A O.S.Supp.2013, § 69(B)(1). Under the current statute, the employer determines "the date of the last issuance of such benefits." 85A O.S.Supp.2019, § 69(A)(1). Both, effectively, give the employer control over which limitations period applies, because the employer determines when it will stop providing benefits. The majority acknowledges as much. According to the majority, if the employer stops providing benefits less than six months after the date of the injury, the employee has one year from the date of the injury to file a claim; but, if the employer provides benefits for more than six months after the date of the injury, the employee has six months from the date of the last issuance of such benefits, i.e., more than one year from the date of the injury, to file the claim. ¶8 The majority finds due process would be violated if the statute of limitations begins to run on the date of the last issuance of benefits, because the employer does not give the employee notice of that date. But, at the same time, the majority finds the statute of limitations begins to run on the date of the last issuance of benefits, even though the employer does not give the employee notice of that date (so long as the date of the last issuance of benefits is more than six months after the date of the injury, making the limitations period longer than one year from the date of the injury). This is a blatant contradiction. Even if the six months provision can be used only to extend the limitations period beyond one year from the date of the injury, as the majority has concluded, the so-called notice problem remains. Whether the employer provides benefits for two months or two years after the date of the injury, the notice question is the same. How does the employee get notice of the date of the last issuance of benefits? Admittedly, the employee is unlikely to receive notice of the date the employer or its insurance carrier makes the last payment to the medical provider. However, the employee will surely have notice of the date of the last issuance of such benefits when he is released at maximum medical improvement and the employer stops providing medical treatment.5 If such notice is insufficient and does, in fact, offend due process, the violation is not new6 nor has it been remedied by the majority's Opinion today. If the majority's holding is applied consistently going forward, notice of the date of the last issuance of benefits will always be deficient--regardless of how long the employer provides benefits. ¶9 Paredes was injured on December 29, 2019. Schlumberger voluntarily provided benefits to Paredes in the form of medical treatment. The date of the last issuance of such benefits was January 29, 2020, when Paredes received his last medical treatment and was released by his treating physician at maximum medical improvement. Paredes filed a claim for benefits on December 3, 2020. In compliance with 85A O.S.Supp.2019, § 69(B), Schlumberger promptly objected to the claim based on the statute of limitations. Pursuant to 85A O.S.Supp.2019, § 69(A)(1), because Paredes had received benefits for the injury, he had six months from "the date of the last issuance of such benefits" to file his claim. The date of the last issuance of such benefits was January 29, 2020, when Paredes received the last medical treatment provided by Schlumberger.7 The claim was filed ten months after the date of the last issuance of such benefits. Therefore, the claim was untimely and should be barred. ¶10 Finally, I disagree with the majority's overstatement in dicta that the Commission has "discretion to adjust the statute of limitations based on the circumstances presented." Majority Op. ¶ 14. FOOTNOTES 1 In many situations, 85A O.S.Supp.2019, § 69(A)(1) actually benefits injured employees. If all injured employees were required to file a claim within one year after the date of the injury and the employer voluntarily provided benefits for two years but then stopped, the employee would be barred from filing a claim for benefits. Under 85A O.S.Supp.2019, § 69(A)(1), the employee does not get stuck with the "lesser" one year statute of limitations. 2 The fundamental purpose of statutory construction is to ascertain and give effect to the intent of the Legislature. Rickard v. Coulimore, 2022 OK 9, ¶ 5, 505 P.3d 920, 923. To do this, we first look to the language of the statute. Id. If the statutory language is clear and unambiguous, this Court must apply the plain and ordinary meaning of the words. Id. (citing 25 O.S.2011 § 1). Only when the legislative intent cannot be determined from the statutory language due to ambiguity or conflict should rules of statutory construction be employed. Rickard, 2022 OK 9, ¶ 5, 505 P.3d at 923. 3 Benefits include both medical treatment and disability compensation. An employee may have received benefits because he filed a claim with the Commission and the employer was ordered to provide benefits or because the employer voluntarily provided benefits, as was the case here. 4 See, e.g., 85 O.S.1941, § 43 ("The right to claim compensation under this Act shall be forever barred unless within one year after the injury a claim for compensation thereunder shall be filed with the commission. Provided, however, claims may be filed at any time within one year from the date of last payment of any compensation or remuneration paid in lieu of compensation."); 85 O.S.Supp.1995, § 43(A) ("The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the last payment of any compensation or remuneration paid in lieu of compensation or medical treatment which was authorized by the employer or the insurance carrier."); 85 O.S.Supp.1998, § 43(A)(same); 85 O.S.2001, § 43(A) (same); 85 O.S.Supp.2005, § 43(A) ("The right to claim compensation under the Workers' Compensation Act shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the last medical treatment which was authorized by the employer or the insurance carrier or payment of any compensation or remuneration paid in lieu of compensation."); 85 O.S.2011, § 318(A) ("The right to claim compensation under the Workers' Compensation Code shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court. Provided however, a claim may be filed within two (2) years of the date of the last medical treatment authorized by the employer or the insurance carrier or the date of the payment of any compensation or remuneration paid in lieu of compensation."); 85A O.S.Supp.2013, § 69(B)(1) ("In cases in which any compensation, including disability or medical, has been paid on account of injury, a claim for additional compensation shall be barred unless filed with the Commission within one (1) year from the date of the last payment of disability compensation or two (2) years from the date of the injury, whichever is greater."). 5 Likewise, if the employer voluntarily provides benefits in the form of disability compensation, the employee will surely have notice of the date of the last issuance of such benefits when the employer stops providing weekly disability compensation. 6 Under the former statute of limitations, the alternative limitations period began to run on "the date of the last disability compensation payment" or the date of the last authorized medical treatment. 85A O.S.Supp.2013, § 69(B)(1); see Green Country Physical Therapy L.P. v. Sylvester, 2018 OK CIV APP 64, 429 P.3d 354 (approved for publication by the Supreme Court). How did the employee receive notice of the date of the last authorized medical treatment? In 2012, how did the employee receive notice of "the date of the last medical treatment authorized by the employer or the insurance carrier or the date of the payment of any compensation or remuneration paid in lieu of compensation?" 85 O.S.2011, § 318(A). In 1995, how did the employee receive notice "of the last payment of any compensation or remuneration paid in lieu of compensation or medical treatment which was authorized by the employer or the insurance carrier?" 85 O.S.Supp.1995, § 43(A). 7 February 14, 2020 was the date Schlumberger made its last payment to the medical provider. Even if we use this later date, of which Paredes did not have notice, as the date of the last issuance of benefits, the claim was untimely.

368059cf-1e7d-4e9d-bcad-53867b15e926

In the Matter of the Adoption of L.B.L.

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ADOPTION OF L.B.L.2023 OK 48Case Number: 119316Decided: 04/25/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE ADOPTION OF: L.B.L., A Minor Child SARA POLLARD, Respondent/Appellant, v. GRANT LLOYD and KALAN LLOYD, Petitioners/Appellees. ¶0 Petitioners Lloyds sought to adopt minor child L.B.L. without Mother Sara Pollard's consent. The District Court of Cherokee County, Judge Josh King, found that Child was eligible for adoption without Mother's consent. Mother appealed, and the Court of Civil Appeals, Division 1, reversed the trial court. The LLoyds petitioned for writ of certiorari from this decision. We granted the petition for writ of certiorari, vacate the Court of Civil Appeals opinion, and affirm the trial court. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS' OPINION VACATED; TRIAL COURT AFFIRMED; CASE REMANDED TO TRIAL COURT Kathleen M. Egan, Aaron D. Bundy, Law Office of Aaron D. Bundy, PLC., Tulsa, Oklahoma, for Respondent/Appellant Natalie S. Sears, Hall Estill Hardwick, Gable, Golden & Nelson, P.C., Tulsa, Oklahoma, and Jacob W. Aycock, Robinett, Swartz & Aycock, Tulsa, Oklahoma, for Petitioners/Appellees Denise Deason-Toyne, Tahlequah, Oklahoma, For Minor Child KUEHN, J.: ¶1 This case of adoption without parental consent illustrates the tension between two competing principles: parental rights and the care necessary to provide due process before terminating those rights without consent versus the "best interests of the child" standard emphasized in the Adoption Code. Ideally, the child's best interests run together with the parent's. In practice these principles seldom conflict, because a trial court may usually give equal effect to both. Sometimes, this can only be done by ensuring the parent's due process rights are protected, then considering which outcome is in the child's best interests. Here, the Court of Civil Appeals specifically acknowledged the best interests of the child standard, but allowed it to be outweighed by other considerations in reaching its conclusion. Consequently, we vacate the Court of Civil Appeals opinion, affirm the trial court, and remand the case to the trial court for further proceedings. FACTS AND PROCEDURAL HISTORY ¶2 Minor Child L.B.L was born to Respondent Pollard (Mother) in May 2017. Child was born addicted to methamphetamine and PCP. The next two and a half years of Child's life were tumultuous. As an infant he stayed with Mother in a rehabilitation facility. In 2018, Father was convicted of assault and battery in the presence of a minor child. During the summer of 2019, the Department of Human Services investigated whether and under what circumstances Child might safely remain with either or both parents. On August 4, 2019, while staying with Father, Child was found in the afternoon wandering alone in a parking lot, wearing only a diaper. Child was returned to Father. Around the same time Mother tested positive for drugs. Child was put in Father's custody under a safety plan which prohibited visitation by Mother, but Father nevertheless allowed her to have contact with Child. In late August, DHS removed Child from Father's custody and briefly placed him with a third party. Child was last in Mother's care on August 28, 2019. ¶3 On September 19, 2019, Petitioners, the Lloyds (Guardians), Child's paternal uncle and aunt, were appointed Child's emergency guardians. They were granted full guardianship on December 3, 2019. In connection with this, the trial court issued guardianship standards imposing requirements on Mother and Father before the guardianship could be terminated. These included clean drug tests, attendance in long-term counseling, and assessment and compliance with recommendations for domestic violence and mental health issues.1 The guardianship court held child support in abeyance pending review. When the temporary guardianship began, Guardians started Child on therapy as well as educational and medical intervention, to address his cognitive problems and developmental delays. ¶4 Early in the guardianship, in September 2019, Mother had a Facetime visit with Child. This had an adverse effect on Child, who began to self-harm after the call. Mother subsequently asked Guardians for visitation, including Facetime visitation, ten or fifteen times. However, after the self-harm caused by the first visit, Child's therapist recommended Mother and Child have no further contact, and Guardians refused her requests for visitation. Mother did not participate in the guardianship proceedings. She neither appeared at hearings nor filed any responses. Nor did Mother submit the required proof that she had complied or attempted to comply with the conduct requirements imposed by the guardianship standards.2 A report filed by the Guardian ad Litem on November 27, 2019, notes that during conversations Mother never asked about Child. Because Mother was not involved in the guardianship, the interim orders and visitation arrangements only mention Father. During this time, Mother was not idle. She worked on her own issues, and she made some efforts to remain in Child's life. Mother entered inpatient rehabilitation on September 27, 2019, after the temporary guardianship began. She was discharged on November 18, 2019, but relapsed in December 2019 and again in January 2020. While she was in rehab, Mother did not have a job and could not financially contribute to Child's care. Mother found a job in late February 2020. After meeting her regular monthly expenses, she was able to make two support payments, in May and August 2020, totaling $130.00.3 Although Mother did not give Child any Christmas presents, she sent Child a package with several birthday presents in May 2020. However, overall, Mother herself admitted that between July 2019 and September 2020, there was no month in which she maintained a substantial and positive relationship with Child. ¶5 Six months into the guardianship proceedings, in June 2020, Mother filed a petition for visitation. Guardians objected, noting Mother had not previously requested visitation, had failed to provide a clean drug test, had not complied with the guardianship standards, and had not contacted Child's therapist regarding visitation. Child had not seen Mother since September 2019. Mother's petition was denied in August 2020. After Guardians' objection was filed in June 2020, Mother found out who Child's counselor was, contacted the counselor, and scheduled an appointment for herself in accordance with the guardianship standards; Mother admitted that she knew the guardianship standards had been issued in fall 2019. ¶6 On September 21, 2020, Guardians filed a petition to adopt Child without Mother's consent. In the petition, they alleged Mother had willfully failed to contribute to Child's support or establish and/or maintain a substantial and positive relationship with Child for twelve consecutive months out of the fourteen months preceding the filing of the petition for adoption. On September 28, 2020, Mother began filing reports in the guardianship case on the progress she'd made with the court-ordered guardianship standards. Trial Court's Findings of Fact and Conclusions of Law ¶7 The trial court granted the request for adoption without Mother's consent. The trial court's Findings of Fact included: (a) the relevant time period for the adoption proceedings was from July 21, 2019, through September 20, 2020; (b) Child was last in Mother's care on August 28, 2019, and Mother's duty to support Child began on that date; (c) the guardianship court held child support in abeyance but did not relieve Mother of the duty to support Child; (d) Mother paid no child support from September 2019 through April 2020, or June and July 2020, and although any child support order had been stayed she paid $130 in child support in May and August 2020; (e) mother had the ability to pay during that time; (f) Mother relapsed with drugs and alcohol in December 2019 and January 2020; (g) Mother had been employed from February 29, 2020 through the date of the hearing; (h) Mother testified that she failed to maintain a substantial and positive relationship with Child, had not seen Child since a FaceTime visit in September 2019, and had not exercised any parental rights or responsibilities since August 28, 2019; (i) Child engaged in self-harm following the September Facetime call and Child's therapist recommended visitation should cease; (j) Mother asked for more Facetime visits but was told of the therapist's recommendation; (k) Mother did not appear or participate in guardianship proceedings until June 2020; (l) Mother received all the guardianship standards and court orders; (m) after informally attempting to get visitation with Child, Mother filed a formal request for visitation; (l) Mother testified that Guardians followed the therapist and guardian ad litem recommendations regarding visitation; (m) Mother admitted she chose not to take further steps to maintain a substantial and positive relationship with Child. ¶8 Applying these facts to the statutory requirements for adoption without parental consent, the trial court concluded that: (a) it had jurisdiction, venue was proper, the federal and state Indian Child Welfare Acts did not apply; (b) the law presumes consent of a parent is necessary for adoption, with exceptions including Title 10, Sections 7505-4.2(B) and 7505-4.2(H); (c) these statutes must be strictly construed, and the party seeking adoption without consent must prove it is warranted by clear and convincing evidence; (d) in defense of a claim of failure to maintain a substantial and positive relationship with Child, the parent must prove to the court's satisfaction that she took sufficient legal action to support such a relationship, but was denied the opportunity due to the custodian's actions; (e) Guardians had met their burden to show Mother willfully failed to support Child and failed to establish and/or maintain a substantial and positive relationship with Child, within twelve consecutive months during the relevant time period; and thus (f) Child was eligible for adoption without Mother's consent. BEST INTERESTS OF THE CHILD ¶9 The Legislature's overriding principle in adoption cases is the best interests of the child. The first sentence of the Adoption Code makes it clear: "The Legislature of this state believes that every child should be raised in a secure, loving home and finds that adoption is the best way to provide a permanent family for a child whose biological parents are not able or willing to provide for the child's care or whose parents believe the child's best interest will be best served through adoption." 10 O.S. § 7501-1.2(A) (emphasis added). And the statute's purpose -- the primary consideration in any adoption proceeding -- is to "ensure and promote the best interests of the child. . . ." 10 O.S. § 7501-1.2(A)(1). In this vein, when the Legislature described the purpose of the revised Children and Juvenile Code, it began by establishing a presumption that the best interests of a child are ordinarily served by leaving the child in its parents' custody. 10A O.S. § 1-1-102(A)(1) (emphasis added). And the Legislature explicitly affirmed the policy importance of the child's best interests: "[W]here family circumstances threaten the safety of a child, the state's interest in the welfare of the child takes precedence over the natural right and authority of the parent to the extent that it is necessary to protect the child and assure that the best interests of the child are met." 10A O.S. § 1-1-102(A)(3) (emphasis added). ¶10 This Court has also clearly articulated the importance of the best interests of the child in adoption proceedings. "The primary issue in adoption is whether the adoption will promote the best interests of the child." C.D.M., 2001 OK 103, ¶ 23, 39 P.3d at 811. COCA relied on In the Matter of Adoption of M.A.S., 2018 OK 1, 419 P.3d 204, to justify its emphasis on the requirements of Section 7505-4.2 as opposed to the best interests of the child. M.A.S. notes that the statute requires a reviewing court to construe the statute strictly in a parent's favor, given the importance of parental rights and the fact that the party seeking to terminate those rights has the burden of proof. M.A.S., ¶ 11, 419 P.3d at 208. However, after discussing the statutory requirements, M.A.S. states: "The best interests of the child serve as the polestar in all adoption proceedings." Id. ¶ 30, 419 P.3d at 214 (quoting In re Adoption of M.J.S., 2007 OK 44, ¶ 30, 162 P.3d 211, 222). ¶11 A court must construe the statute strictly in a parent's favor because every biological parent has a fundamental liberty interest in the care, custody and management of their child, even if that relationship is strained or worse. Santosky v. Kramer, 455 U.S. 745, 753-54 (1982). A parent's rights must be strenuously protected, by providing the parent with fundamentally fair procedures before that familial bond, however weakened, may be destroyed by the State. Id. Oklahoma has protected this fundamental liberty interest by enacting the strict due process requirements of Title 10, Section 7505-4.2. That's not at issue here; Mother was afforded those protections. ¶12 Usually, protecting a parent's due process rights, as defined by statute, will be in a child's best interests. That is not always the case. Occasionally, as here, a trial court terminates parental rights, after considering the factors set forth in Section 7505-4.2, based on evidence that though a parent tries to maintain a relationship, the child is actually harmed by contact with the parent. Despite the parent's fundamental interest in her parental relationship with her child, neither a trial court nor a reviewing court may disregard this evidence. The trial court found that Guardians denied Mother access because they were told by Child's counselor that seeing Mother caused Child to harm himself, and because they saw Child harm himself after the visit with Mother. Implicit in this finding is a determination that Child's best interests were not served by visitation -- because it is not in a child's best interest to require it to undergo an experience that results in harm to the child. And the trial court found the statutory basis making Child eligible for adoption without Mother's consent was Mother's failure to support Child and failure to establish and/or maintain a substantial and positive relationship with child under Sections 7505-4.2(B)(2) and 7505-4.2(H)(1). Because the purpose of the Adoption Code is to ensure and promote the best interests of the child under Section 7501-1.2(A), when the trial court made those findings, it inherently found that adoption without consent was in Child's best interests. ¶13 COCA agreed that Guardians and Child's therapist were acting in Child's best interests, stating, "There is not one sliver of evidence in this case that Foster Parents acted as they did for any reason other than for the benefit of the child." COCA thus explicitly acknowledged the "best interests of the child" standard. However, COCA found that fulfillment of the statutory factors overrode the best interests of the child -- that the simple fact of Guardians' refusal of visitation, without considering the reason, absolved Mother of her responsibility to establish and/or maintain a substantial and positive relationship with Child. This misapplication of the law disregards both the full language of the statute and the expressed intent of the Legislature. Adoption Without Mother's Consent is in Child's Best Interests ¶14 When determining which outcome is in a child's best interests, we may look at the evidence considered by the trial court which supports adoption, including the child's bond and relationship with the guardians seeking adoption. C.D.M., 2001 OK 103, ¶ 24, 39 P.3d at 811. Clear and convincing evidence supports the trial court's conclusion that adoption without Mother's consent is in the best interests of Child. The record supports the trial court's findings of fact that, since being placed with Guardians, Child has received educational and medical care to address his cognitive and developmental delays. In that time, Child has begun to meet developmental milestones. Child's therapist reported to the trial court that, in that stable environment, Child had bonded with Guardians and was thriving. ¶15 The record supports the trial court's findings that since the guardianship, Mother effectively failed to establish or maintain a relationship with Child until June 2020, when she asked for a hearing to determine visitation. The trial court found that, by her own admission, Mother could have sent Child cards, letters, or toys, but, other than the birthday package, did not. She never contacted Guardians to ask if Child needed anything. Although Mother knew she needed to contact Child's therapist before the guardianship could end, she made no attempt to do so until Guardians objected to her formal request for visitation. Evidence supported the trial court's finding that Child harmed himself after his only Facetime visit with Mother; Child pulled his hair out, hit and slapped himself, scratched his face, and hit his head on a wall. Child was still a toddler. In the two and a half years between Child's birth and the guardianship, Mother shared custody with Father and had him as an infant with her during one stay in a rehabilitation facility. After that stay and before the guardianship, as a result of Mother's continued substance abuse, DHS ordered that Child have no contact with Mother. ¶16 Neither the trial court nor this Court are asked to determine whether Mother loves Child or would like to be able to care for him. We do not make light of the difficulty of Mother's circumstances. But the record shows that Mother's life of substance abuse, poverty, and domestic violence took a toll not only on her, but on Child. The record shows that, by the time of the hearing on the adoption petition, Mother had made efforts to comply with the guardianship standards. But the trial court was in the best position to weigh all the evidence, including Mother's testimony and her admissions. STATUTORY REQUIREMENTS FOR ADOPTION WITHOUT CONSENT ¶17 The State recognizes that, for some children, adoption is the best way to provide a secure and loving home. 10 O.S. § 7501-1.2(A). Under very narrow circumstances, set forth explicitly in statute, the State permits adoption without a parent's consent. Two exceptions to the consent requirement are at issue here. Section 7505-4.2(B) provides: Consent to adoption is not required from a parent who, for a period of twelve (12) consecutive months out of the last fourteen (14) months immediately preceding the filing of a petition for adoption of a child or a petition to terminate parental rights pursuant to Section 7505-2.1 of this title, has willfully failed, refused, or neglected to contribute to the support of such minor. . . . According to such parent's financial ability to contribute to such minor's support if no provision for support is provided in an order. 10 O.S. § 7505-4.2(B). ¶18 Section 7505-4.2(H)(1) provides: Consent to adoption is not required from a parent who fails to establish and/or maintain a substantial and positive relationship with a minor for a period of twelve (12) consecutive months out of the last fourteen (14) months immediately preceding the filing of a petition for adoption of the child. 10 O.S. 7505-4.2(H)(1). Willful Failure to Support Child ¶19 There is no dispute that Mother failed to support Child for twelve consecutive months within the fourteen months before the adoption petition was filed.4 The question here is whether Mother's failure to support was willful. This is determined by the particular facts of the case. M.A.S., 2018 OK 1, ¶ 16, 419 P.3d at 211. The trial court framed this as whether Mother's duty to support under Section 7505-4.2(B) was affected by the guardianship court's order holding child support in abeyance until review. The court found that although the order did not specify an amount, the duty itself was not affected. COCA's opinion does not appear to address this finding, but instead, delves into the minutiae of Mother's finances during that period in an attempt to determine whether she could have paid more than she did. Ability to pay is relevant to determine whether a parent's actions are willful. Id. ¶ 20, 419 P.3d at 212. COCA reasoned that if Mother could have paid more, but did not, her actions would be willful. ¶20 However, neither the trial court nor COCA recognized the practical effect of the guardianship court's order holding child support in abeyance. That order remained in effect for ten consecutive months out of the fourteen-month time period. Whether or not Mother had a duty to provide support, and whether or not she could, it was not unreasonable of her to act as if that order relieved her of the immediate duty to pay child support. Mother testified that she was confused because her attorney told her to make what payments she could, but the court had not ordered it. The court order indicated that Mother did not need to make support payments until an undetermined future date. Mother complied with that order. We will not find that compliance with a court order which entirely, if temporarily, relieves Mother of her duty to pay renders Mother's failure to support willful. G.D.J., 2011 OK 77, ¶ 22, 261 P.3d at 1165. Substantial and Positive Relationship with Child ¶21 Mother admitted that she did not establish and/or maintain a substantial and positive relationship with Child during the relevant time period. She argued that this wasn't her fault, because Guardians refused her requests for visitation after her first Facetime visit caused Child to injure himself. Under Section 7505-4.2(H)(2), Mother may claim that Guardians, as Child's custodians, denied her the opportunity to establish and/or maintain a relationship with Child; Mother must prove to the court's satisfaction that she took sufficient legal action to establish and/or maintain a substantial and positive relationship with Child before receiving notice of the hearing on the petition for adoption without consent. 75 O.S. § 7505-4.2(H)(2). ¶22 COCA found that this exception applied because Child's custodians denied Mother visitation, and that her petition for visitation, filed in June 2020, was sufficient legal action. COCA specifically found that Guardians acted on the advice of Child's therapist. However, COCA concluded that such an order could not count against the parent's ability to form the required relationship. Instead, COCA concluded that, under the statute, "a parent's denial-of-opportunity defense is not overcome by a custodian's evidence that their denial was based on reliable professional advice or any other good reason." COCA offered no citation to authority. This conclusion is not supported by either the language of the statute or case law. And it does not take into account the statute's overall emphasis on the best interests of the child. ¶23 The language of Section 7505-4.2(H)(2), describing the defense of denial by custodian, cannot be read narrowly or in isolation. COCA's analysis began and ended with the fact that Guardians denied Mother visitation. But the statute refers to a substantial and positive relationship with the child. This is not limited to visitation; visitation and communication are different things. As Mother herself admitted, she could have sent letters, cards, books or toys to foster a positive relationship. She could have, as she had been ordered to do, contacted Child's therapist. She could have contacted Guardians to explore other avenues of communication. The record does not show that Guardians prevented Mother from making any attempt at establishing a relationship, other than refusing visitation for Child's safety. Between late August 2019 and August 2020, when the petition for adoption was filed, Mother's only contact with Child was when she sent a birthday package. The trial court properly considered this when determining whether Guardians had denied Mother the opportunity for a substantial and positive relationship with Child. ¶24 To give effect to both the letter and spirit of the statute, we inquire into more than whether a custodian has denied a parent the opportunity for a substantial, positive relationship -- we ask why. A parent may be prevented from raising this defense to an adoption without consent if her actions or choices harm the child, resulting in an official recommendation or even prohibition against contact. This is determined case by case, reviewing the entire record. If, as happened here, the actual contacts between a mother and child are neither substantial nor positive, we will not find that a custodian's refusal of visitation denied the mother the opportunity for a substantial and positive relationship. G.D.J., 2011 OK 77, ¶ 26, 261 P.3d at 1166. And if a parent's intentional actions contradict or disregard her basic parental obligations, this may show she didn't intend to have a significant relationship with the child. C.D.M., 2001 OK 103, ¶ 17, 39 P.3d at 808 (fact of and reasons for incarceration are relevant to a court's consideration of whether parental consent is necessary). ¶25 The record shows that throughout Child's short life, his contacts with Mother were not positive. In the months immediately preceding the emergency guardianship, Mother was ordered to have no contact with Child. This order was dissolved by the guardianship. Child's adverse and self-harming response to a visit with Mother prompted Child's therapist to recommend no visitation. However, there was and is no prohibition against all contact. Mother could have explored other avenues to remain in Child's life. She chose not to do so. Clear and convincing evidence supports the trial court's conclusion that Guardians have met their burden to show that Mother failed to establish and/or maintain a substantial, positive relationship with Child. Conclusion ¶26 Given the court order regarding support, we cannot find that Mother willfully failed to contribute to Child's support during the relevant time period. However, Mother failed to maintain a substantial and positive relationship with Child during that time. And the record supports the conclusion that adoption without Mother's consent is in the best interests of Child. COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT AFFIRMED; CASE REMANDED TO TRIAL COURT FOR FURTHER PROCEEDINGS. CONCUR: Kane, C.J., Rowe, V.C.J., Winchester, Edmondson, and Kuehn, JJ. DISSENT: Kauger, Combs, Gurich, and Darby (by separate opinion), JJ. FOOTNOTES 1 Father initially was granted Facetime visitation, but this also led Child to self-harm, and was ended on the advice of Child's counselor and guardian ad litem. 2 By failing to respond to Guardians' Requests for Admissions in the adoption proceedings, Mother admitted that she made no request for supervised visitation until May 2020. Mother also admitted that she did not contact Child's therapist, as required by the standards, until July 2020; that she relapsed after her inpatient rehabilitation; that she had been arrested in Texas for driving under the influence while Child was in the vehicle; and that she had two other children who tested positive for drug exposure in utero at birth. 3 The trial court noted that Mother's expenses included a cell phone. In the modern world, cell phones are a necessity, not a luxury; banking, job information, work communications, and other important information are routinely done by cell phone. 4 Mother paid no support from August 2019, when Child was removed from her custody, through December 3, 2019, when the permanent guardianship was ordered. She paid $30 in May 2020 and $100 in August 2020. Mother did not provide support for any consecutive months during the relevant time period. Darby, J., with whom Combs, J., joins, dissenting: ¶1 I respectfully dissent. ¶2 Despite accurately reciting the firmly established law that courts must strictly construe the statutes in a parent's favor, and recognizing that Oklahoma has enacted strict due process requirements in title 10, section 7505-4.2, the majority brushes off actually applying these legal demands and states: "That's not at issue here; Mother was afforded those protections." Majority Op. ¶ 11. I think not. ¶3 The majority notes that, under the statute, COCA concluded that "'a parent's denial of opportunity defense is not overcome by a custodian's evidence that their denial was based on reliable professional advice or any other good reason.'" Majority Op. ¶ 22. In other words, COCA would allow Mother in this case to raise the defense of denial of opportunity to form a positive relationship with Child. But the majority holds that: "This conclusion is not supported by either the language of the statute or case law." Id. Let us review the language of the statute as written. ¶4 Title 10, section 7505-4.2(H)(2) states: In any case where a parent of a minor claims that prior to the receipt of notice of the hearing provided for in Sections 7505-2.1 and 7505-4.1 of this title, such parent had been denied the opportunity to establish and/or maintain a substantial and positive relationship with the minor by the custodian of the minor, such parent shall prove to the satisfaction of the court that he or she has taken sufficient legal action to establish and/or maintain a substantial and positive relationship with the minor prior to the receipt of such notice. 10 O.S.2011, § 7505-4.2(H). Construing this provision "strictly" and "in parent's favor" we must conclude a parent need only "claim" denial of opportunity and then prove to the satisfaction of the court that they took "sufficient legal action" to establish the required relationship. The majority would require more from the parent than does the statute. The Court, in its opinion, goes behind the "claim" to investigate if the denial of opportunity was the parent's fault. In this case, Mother face-timed her child (all of 28 months old), after which the two-year-old threw a fit causing the counselor to allegedly forbid further contact of any kind between mother and child.1 So, because a two-year-old threw one tantrum after face-time with Mother, she cannot claim she was denied her opportunity to form a good relationship with Child and then support her defense by proving she took sufficient legal action. And that's how the majority would "construe the statute strictly" and "strenuously protect" Mother's rights. ¶5 The majority references In re Adoption of G.D.J., 2011 OK 77, 261 P.3d 1159, and In re Adoption of C.D.M., 2001 OK 103, 39 P.3d 802, as authority for denying Mother the defense of claiming she was denied the opportunity to establish and/or maintain a substantial and positive relationship with Child. ¶6 In In re Adoption of C.D.M., the father claimed this defense but was denied by this Court because he caused the reason for the denial. The reason: Father was incarcerated for stalking and assaulting the mother and violating a victim's protective order entered to protect the child and its mother from the father's acts of violence. I do not see the comparison or relevance to mother in this case. ¶7 In In re Adoption of G.D.J., mother claimed this defense that she was prohibited from visiting or contacting child but her testimony "was not found credible by the trial court." In re Adoption of G.D.J., 2011 OK 77, ¶ 26, 261 P.3d, at 1166. The reasons the guardians denied mother visitation were: (1) she was in a drug rehabilitation facility, (2) she had a positive tuberculosis skin test, (3) after a phone call with mother, the guardians were concerned about her conditions and the child's best interest, (4) mother was at times in the presence of convicted felons, one of whom was a registered sex offender, (5) mother was arrested at the courthouse while in possession of the child, (6) she put child at risk of exposure to communicable diseases, and (7) during this time she had various criminal proceedings filed against her, along with outstanding bench warrants. ¶8 More importantly for our concerns, this Court in In re Adoption of G.D.J., after denying mother's defense of denial of opportunity, addressed whether mother took sufficient legal action to establish and/or maintain a substantial and positive relationship with the child. The Court held, "The record fails to demonstrate there was any action taken by Stubbs against the Pearsons during the relevant period based upon her being denied the opportunity to establish and/or maintain a substantial and positive relationship with G.D.J." Id., 2011 OK 77, ¶ 27, 261 P.3d, at 1167. ¶9 Of course, the Court must consider the best interest of Child. But best interest is to be considered along with the statutes, not instead of. "In addition to the statutory requirements, this Court has also required that the adoption and termination of parental rights be in the best interests of the child." In re Adoption of C.D.M., 2001 OK 103, ¶ 22, 39 P.3d, at 810. And in finding that consent of the natural parent is not required, the district court did not mention the best interest of the child even once. Yet the majority interprets the order to contain an "implicit" finding that Child's best interests were not served by visitation and an "inherent" finding that adoption without consent was in Child's best interests. See Majority Op. ¶ 12. ¶10 The law does not require us to strictly construe the statutes by only a best interest standard. Rather, we must construe the statutes strictly and in parent's favor --then also consider the best interests of the child. Justice Kauger, joined by Justice Opala in her concurring in part and dissenting in part opinion in In re Adoption of Baby Boy W., 1992 OK 58, ¶ 1 831 P.2d 643, 648 (Kauger, J., with whom Opala, C.J. joins, concurring in part and dissenting in part) said it best: " The result reached by the majority may arguably be in the best interest of the child, but it is not the law." ¶11 For the above reasons, I respectfully dissent. FOOTNOTES 1 But the record here also discloses an erroneous reliance on the finding of fact that child's "therapist recommended that all visitation should cease with the natural parents until appropriately addressed in therapy." Order 4, para. 16. The record does not support that finding in any way. Rather, the letters in the record from the child's therapist specifically stated that the therapist recommended all visitation with father should cease. See R. at 25, 44. There was no mention of Mother at all in those letters. R. at 25, 44. In fact, when Mother's attorney attempted to ask the guardian mother some questions about the counselor and her recommendations, Guardian's attorney objected for relevance. The following dialogue then occurred: [MOTHER'S ATTORNEY]:Your Honor, we just have concerns that this counselor's never here to question, and her education is -- we would prefer a Ph.D, to assess this child if he truly has significant problems. And I'm just trying to ascertain if there's some kind of relationship or why this counselor particularly. THE COURT: And I -- I certainly see the potential relevance in ultimate proceedings, but for the purpose of today's hearing, the AWOC hearing, I don't see the relevance, so the objection will be sustained. R., Tr. of Application to Adj. the Minor Eligible for Adopt. without Consent of the Natural Parents 75:9--18. Mother's attorney had previously objected to guardian mother testifying about the contents of the counselor's recommendations as hearsay and noted concerns that the counselor had never been before the court to testify or be questioned about her recommendations. See id., at 69:5--12. The district court sustained the objection, but noted that the Court had "requested and actually ordered these -- the updates from the counselor, so the Court is on notice of what the recommendations are." Id., at 69: 13--16. The updates from the Counselor were not filed in the adoption case, but rather in the guardianship proceedings--and more importantly the Counselor's updates did not mention Mother in any way.

3ab8bf58-f9a9-475a-ae60-c0b1135b0e17

Chimento v. Gallagher Benefit Services

oklahoma

Oklahoma Supreme Court

CHIMENTO v. GALLAGHER BENEFIT SERVICES2023 OK 22Case Number: 120089Decided: 03/21/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. SUE CHIMENTO, Plaintiff/Petitioner, v. GALLAGHER BENEFIT SERVICES, INC., and SCOTT MCCOY, Individually, Defendants/Respondents. APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY Honorable Daman Cantrell, District Judge ¶0 In the underlying lawsuit, Plaintiff, Sue Chimento, brought claims for defamation, negligence, intentional interference with business relations, false representation, constructive fraud, and conspiracy against Defendants, Gallagher Benefit Services, Inc., and Scott McCoy, based on allegations they made to the Tulsa Police Department, Tulsa County District Attorney's Office, and the Oklahoma Insurance Department that she had embezzled money while under their employment. The trial court granted partial summary judgment to Defendants, finding that their statements to the police and district attorney were subject to an absolute privilege and their statements to Oklahoma Insurance Department were subject to a qualified privilege under 36 O.S. § 363. The trial court certified its order granting partial summary judgment for interlocutory review. We hold that Defendants' statements to the police, the district attorney, and the Oklahoma Insurance Department are afforded a qualified privilege. CERTIORARI PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED IN PART, REVERSED IN PART; REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. Eric W. Stall, Swab Stall Horton & Fu, P.A., Tulsa, Oklahoma, and Douglas E. Stall, Douglas E. Stall, P.L.L.C., Tulsa, Oklahoma, for Plaintiff/Petitioner. Ryan A. Ray and Rebecca S. Woodward, Norman Wohlgemuth, LLP, Tulsa, Oklahoma, for Defendants/Respondents. OPINION ROWE, V.C.J.: I. BACKGROUND ¶1 In February 2013, Petitioner, Sue Chimento, began working for Respondent Scott McCoy at his insurance agency, Scott McCoy Insurance Agency ("SMIA"). One of Chimento's primary responsibilities at SMIA was administration of its Tribal Sponsorship Program, through which SMIA assisted Native American Tribes in procuring health insurance for their employees. Specifically, Chimento would receive premium invoices for their tribal clients from the insurance companies and forward those bills to the Tribes. The Tribes would then pay a lump sum to SMIA to cover the premiums. SMIA established a bank account at Midfirst Bank dedicated to receiving these payments (the "Tribal Account"). Chimento would pay individual premiums on behalf of the Tribes' employees out of the Tribal Account. Given how the Tribal Account was utilized, it was typical for the Tribal Account to have a zero balance. ¶2 In early September 2016, SMIA was acquired by Arthur J. Gallagher & Co. ("AJG"). Chimento was kept as an employee after the acquisition to perform insurance-related services for AJG's wholly-owned subsidiary, Gallagher Benefit Services, Inc. ("GBS"). Scott McCoy was kept as well and continued to serve as Chimento's supervisor. In her role with AJG/GBS, Chimento continued administering the Tribal Sponsorship Program and utilizing the Tribal Account. ¶3 In March 2017, Midfirst Bank contacted Scott McCoy and informed him that the Tribal Account was overdrafted. Shortly after McCoy inquired of Chimento as to why the account was overdrafted, Chimento resigned her employment with AJG. On November 16, 2017, McCoy filed a report with the Tulsa Police Department ("TPD") alleging that Chimento embezzled approximately fifty-one thousand dollars ($51,000.00) from SMIA and AJG/GBS. After filing the police report, McCoy followed up several times with TPD and the Tulsa County District Attorney's Office regarding the status of their investigation and whether any criminal charges had been filed against Chimento. ¶4 On April 5, 2018, the Tulsa County District Attorney filed a criminal information charging Chimento with one count of felony embezzlement. Chimento was arrested the following day. On June 19, 2018, the District Attorney dismissed the charges against Chimento for insufficient evidence.1 ¶5 On or about July 9, 2019, Chimento submitted an application with the Oklahoma Insurance Department ("OID") to renew her resident insurance producer license. On October 1, 2019, the OID denied Chimento's renewal application, citing suspected violations of the Oklahoma Producer Licensing Act in 36 O.S.2011 § 1435.13(A). The OID relied on information and evidence obtained in an investigation by the Oklahoma Anti-Fraud Division, which was derived from the investigation conducted by TPD. On October 23, 2019, the OID issued a Notice of Hearing and Order to Show Cause to Chimento alleging numerous violations of the Oklahoma Insurance Code, including acting as a third-party administrator without a license, mishandling premium payments, making false entries into accounting books, and engaging in fraudulent and dishonest conduct. II. PROCEDURAL HISTORY ¶6 On September 21, 2018, Chimento filed suit against AJG/GBS and McCoy (collectively "Defendants") alleging defamation, negligence, intentional interference with business relations, false representation, constructive fraud, and conspiracy. Chimento would later dismiss her defamation claims. Each of Chimento's remaining claims adhere to a general thesis, that Defendants made false allegations to the Tulsa County District Attorney's Office, TPD, and other third parties with the intent of harming her reputation and business. Defendants filed counterclaims against Chimento alleging breach of her employment agreement, breach of fiduciary duty, fraud, unjust enrichment, tortious interference with contract, misappropriation of trade secrets, misappropriation of confidential business information, and civil conspiracy. ¶7 Between February 21 and February 24, 2020, the parties filed cross motions for summary judgment on their own and each other's claims and counterclaims. In Defendants' motion for summary judgment on Chimento's remaining claims, Defendants asserted that any of their statements to TPD, the District Attorney's Office, and the OID were subject to an absolute privilege, and thus, to the extent any of Chimento's claims were based on these statements, the claims must fail. On October 27, 2020, the trial court granted summary judgment to AJG/GBS on all of Chimento's remaining claims. The trial court granted summary judgment to Scott McCoy on all of Chimento's remaining claims, except those for false representation and constructive fraud. In granting summary judgment to Defendants, the trial court found that Defendants' statements to TPD and to the District Attorney's office were subject to an absolute privilege under 12 O.S. § 1443.12 and their statements to the OID were subject to a qualified privilege under 36 O.S. § 363. The matter was then set for trial on the parties' remaining claims and counterclaims. ¶8 On November 1, 2021, the parties appeared in court to commence with the trial. Prior to the proceedings, the parties conducted an in camera conference with the court to discuss a number of motions in limine. During that conference, the trial court realized that a number of evidentiary problems had been created by its finding that Defendants' statements to TPD, the District Attorney's Office, and the OID were privileged. Essentially, the parties would have been hard-pressed to litigate the remaining claims without referencing the investigations by TPD, the District Attorney's Office, and the OID, which would inevitably involve reference to the allegedly privileged statements. ¶9 Following these discussions, the parties submitted a Joint Motion to Certify Questions of Law for Immediate Interlocutory Review. On November 24, 2021, the trial court issued an order granting partial summary judgment and certifying the following questions of law for immediate interlocutory appeal: 1. Are communications made to a police officer regarding the allegation that another has committed a crime entitled to an absolute privilege under the doctrine set forth in Kirschstein v. Haynes, 1990 OK 8, 788 P.2d 941? Or are such communications only qualifiedly privileged under the doctrine set forth in Johnson v. Inglis, 1942 OK 80, ¶ 6, 123 P.2d 272 and in the comments to OUJI 3d, no. 28.8? 2. Are communications made to a District Attorney's office regarding the allegation that another has committed a crime entitled to an absolute privilege under the doctrine set forth in Kirschstein v. Haynes, 1990 OK 8? Or are such communications only qualifiedly privileged under the doctrine set forth in Johnson v. Inglis, 1942 OK 80, ¶ 6, 123 P.2d 272 and in the comments to OUJI 3d, no. 28.8? 3. Are communications by an insurer, employee, or agent of an insurer made to the Insurance Department that another insurance agent has engaged in or is engaging in an act or practice that violates any statute or administrative rule of this state related to insurance fraud entitled to an absolute privilege under the doctrine set forth in Kirschstein v. Haynes, 1990 OK 8[,] and Presson v. Bill Beckman Co., 1995 OK CIV APP 44, 898 P.2d 179? Or are such communications only qualifiedly privileged under Title 36, § 363 A and B, and the doctrine set forth in Johnson v. Inglis, 1942 OK 80, ¶ 6, 123 P.2d 272 and in the comments to OUJI 3d, no. 28.8? Both Chimento and Defendants filed petitions for certiorari on the certified interlocutory order, which we granted and consolidated. III. STANDARD OF REVIEW ¶10 We review a trial court's order granting summary judgment de novo. Tiger v. Verdigris Valley Elec. Coop., 2016 OK 74, ¶ 13, 410 P.3d 1007, 1011. Likewise, the questions posed in the trial court's certified interlocutory order are questions of law, which are subject to de novo review. Lincoln Farm, L.L.C. v. Oppliger, 2013 OK 85, ¶ 12, 315 P.3d 971, 975. De novo review involves a plenary, independent, and non-deferential examination of the issues presented. Benedetti v. Cimarex Energy Co., 2018 OK 21, ¶ 5, 415 P.3d 43, 45. IV. DISCUSSION A. Defendants' statements to law enforcement are entitled to a qualified privilege. ¶11 The parties are in agreement that both TPD and the District Attorney's Office constitute law enforcement entities, and thus, the first two questions certified for review by the trial court can be addressed simultaneously. We have previously held that statements to law enforcement are entitled to a qualified privilege. ¶12 In Beshiers v. Allen, 1915 OK 182, 148 P. 141, the defendant alleged to the county sheriff that the plaintiff robbed a local bank. The plaintiff brought a defamation claim against the defendant. Id. at 142. Following a jury trial, the defendant appealed the trial court's refusal to give several jury instructions related to damages. Id. at 143. In addressing those issues, we stated: The communication made to the sheriff under the facts of this case is a qualified privilege, that is, it is a privilege which exists only if the defendant made it in good faith, with an honest belief that it was true, and with the sole intent to aid justice, and with no malice toward the plaintiff, or intent to injure him .... Id. ¶ 2, 148 P. 141, 143. ¶13 Similarly, in Johnson v. Inglis, 1942 OK 80, 123 P.2d 272, the plaintiff sued for defamation after defendant reported to several Oklahoma City police officers that the plaintiff was illegally selling alcohol out of her home. Following a bench trial, the trial court awarded damages to the plaintiff. Id. ¶ 3, 123 P.2d at 273. Thereafter, the defendant filed a motion to vacate the judgment claiming the statements made to the police officers were subject to an absolute privilege, which the trial court granted. Id. ¶ 4, 123 P.2d at 273-74. We found that the trial court erred in vacating the judgment because "[t]he communication made by the defendant to the police officers does not come within the rule of absolute privilege but if privileged was qualifiedly so." Id. ¶ 5, 123 P.2d at 274. ¶14 In Magness v. Pledger, 1959 OK 1, 334 P.2d 792, the defendants collectively petitioned the Attorney General of Oklahoma to investigate the plaintiff for embezzlement. The plaintiff sued the defendants for libel, but the trial court dismissed his claim, finding that the petition fell within the absolute privilege created by 12 O.S.1951 § 1443.3 Id. ¶ 1, 334 P.2d at 793. On appeal, we reversed the trial court's judgment, finding that the defamatory statements in the petition were not covered by § 1443 because they were not made in the course of a legislative, judicial, or other lawfully authorized proceeding. Id. ¶ 8, 334 P.2d at 794-95. We also noted that the outcome was consistent with our holdings in Beshiers and Inglis. Id. ¶ 11, 334 P.2d at 795. ¶15 In the trilogy of cases, Magness, Inglis, and Beshiers, we applied a qualified privilege to statements made to law enforcement. Following this trilogy of cases, we applied an absolute privilege from the Restatement (Second) of Torts in Kirschstein v. Haynes, 1990 OK 8, 788 P.2d 941, to a different class of statements. In Kirschstein, one of the defendants, who had been raised exclusively by her father, was attempting to obtain a delayed birth certificate through the Oklahoma Department of Health, after discovering that there was no record of her birth on file with state authorities. Id. ¶¶ 3-4, 788 P.2d at 945. The statute for obtaining a delayed birth certificate, 69 O.S.1981 § 1-313, had evidentiary requirements regarding the facts of birth, including the date of birth, place of birth, and parentage. Id. ¶ 3, 788 P.2d at 945. The defendant hired an attorney to assist her in procuring the birth certificate. Id. As part of that effort, the attorney procured an affidavit from an elderly physician in the town where the defendant was allegedly born, stating that the plaintiff had given birth to the defendant. Id. ¶ 5, 788 P.2d at 946. The defendant disclosed the contents of the affidavit to several relatives but never used it to obtain her delayed birth certificate. Id. ¶ 6, 788 P.2d at 946-47. ¶16 When the plaintiff learned of the disclosure, she brought suit against the defendant, the attorney, and the physician for defamation, intentional infliction of emotional distress, and determination of heirs. Id. ¶ 7, 788 P.2d at 947. The trial court granted summary judgment in favor of the defendants finding the affidavit and its publication were privileged. Id. The Court of Civil Appeals affirmed the trial court's ruling. Id. ¶ 9, 788 P.2d at 947. Although we found that the affidavit and its publication were not covered by the statutory privilege afforded under § 1443.1, we applied "the standards set forth at Restatement (Second) of Torts §§ 586, 587, 588," recognizing an absolute privilege under the common law for communications made preliminary to proposed judicial or quasi-judicial proceedings in favor of attorneys, parties and witnesses. Id. ¶¶ 2, 13, 788 P.2d at 945-48. ¶17 Pursuant to these Restatement provisions, statements made to law enforcement would be subject to an absolute privilege,4 rather than the qualified privilege they were afforded under Magness, Inglis, and Beshiers. In Kirschstein, we did not address this potential conflict, nor did we explicitly overrule Magness, Inglis, and Beshiers. ¶18 Defendants claim that although Kirschstein dealt with a different class of statements, it implicitly overruled Magness, Inglis, and Beshiers by adopting the absolute privileges described in §§ 586-588 of the Second Restatement. Chimento claims that Kirschstein does not apply in this instance and that the qualified privilege described in Magness, Inglis, and Beshiers should apply instead. The parties' respective positions pose two basic questions: (1) whether Kirschstein applies to statements made to law enforcement, and (2) whether Kirschstein implicitly overruled our prior precedents that afford only a conditional privilege to statements made to law enforcement. We answer both questions in the negative. ¶19 Defendants claim that Kirschstein applies to statements made to law enforcement. In particular, Defendants point out that in Kirschstein we "favorably cited" to a Court of Civil Appeals ("COCA") opinion, White v. Basnett, 1985 OK CIV APP 10, 700 P.2d 666, in which COCA determined that the absolute privilege under 12 O.S. § 1443.1 covered a citizen's complaint of police brutality filed with the Tulsa Police Department. ¶20 Initially, we note that White is distinguishable from the present matter in that it involved a complaint lodged against a law enforcement officer, whereas here the allegation of wrongdoing was lodged against a private citizen. Additionally, the reference to White comes in a footnote to the following paragraph: This Court has applied an absolute privilege to communications made during various proceedings [including White]. In said cases we construed the predecessor statute to 12 O.S.1981, § 1443.1 to grant a privilege to utterances made in judicial or other proceedings authorized by law. The situation here does not expressly fall within the statute's protection because the communications involved were all made preliminary to a proposed proceeding the record fails to disclose has ever been instituted. We, thus, must determine if the common law, as embodied in the Restatement, provides any privilege to the communications at issue. Kirschstein, 1990 OK 8, ¶ 13, 788 P.2d at 948 (emphasis in original) (internal citations omitted). As the paragraph itself makes clear, the Court in Kirschstein did not believe that White was instructive on the question it was considering because the statements at issue in Kirschstein were made prior to a proposed proceeding. ¶21 Aside from the reference to White, there is no indication in Kirschstein that the Court contemplated its pronouncements extending beyond the circumstances unique to that case. Based on the foregoing, we find that Kirschstein does not apply to statements made to law enforcement. ¶22 Additionally, Kirschstein did not implicitly overrule Magness, Inglis, and Beshiers. Defendants note that this Court has previously recognized the doctrine of overruling by implication. See Sovereign Camp, Woodmen of the World v. Smith, 1936 OK 198, ¶ 11, 56 P.2d 408, 410; Alexander v. Samuels, 1936 OK 260, ¶ 18, 58 P.2d 878. In both Sovereign Camp and Alexander, however, the prior decisions which were deemed overruled by implication were contrary to recent decisions of the United States Supreme Court and, thus no longer valid regardless.5 Here, Magness, Inglis, and Beshiers are not in conflict with any decisions of the United States Supreme Court. ¶23 Defendants also claim that a series of opinions by COCA utilizing the rule announced in Kirschstein demonstrate that it is now controlling on the question before us. See, e.g., Presson v. Bill Beckman Co., Inc., 1995 OK CIV APP 44, 898 P.2d 179. COCA opinions are not binding on this Court. Arulkumar v. Arulkumar, 2022 OK 90, ¶ 21, 521 P.3d 131, 137; Foshee v. Foshee, 2010 OK 85, ¶ 14 n.6, 247 P.3d 1162, 1168. Thus, although COCA may have extended the absolute privilege from Kirschstein to statements made to law enforcement, we decline to do the same. To the extent any COCA opinions conflict with our holding in this matter, they are hereby overruled. ¶24 Based on the foregoing, we find that statements made to law enforcement enjoy a qualified--and not absolute--privilege. Thus, any statements Defendants made to TPD and the District Attorney's Office only enjoy a qualified privilege.6 B. Defendants' statements to the Oklahoma Insurance Department are entitled to a qualified privilege. ¶25 The remaining question certified for interlocutory review asks whether Defendants' statements to the Oklahoma Insurance Department are absolutely privileged pursuant to Kirschstein or only qualifiedly privileged pursuant to 36 O.S.supp.2012 § 363.7 Section 363(B) provides qualified immunity from civil actions for individuals who furnish information to the OID regarding fraudulent insurance activity. The trial court determined that the qualified privilege under § 363(B) applied. We agree. ¶26 We recently interpreted and applied this statute in Loven v. Church Mutual Ins. Co., 2019 OK 68, 452 P.3d 418. In Loven, the plaintiff, a general contractor, applied with the OID to become licensed resident public adjuster. As part of her application, the plaintiff disclosed that she was being sued by a former client, who alleged that she had illegally acted as unlicensed public adjuster. Id. ¶ 4, 452 P.3d at 420. Due to her disclosure, the OID's Anti-Fraud Unit initiated an investigation of the plaintiff. Id. In the course of its investigation, the Anti-Fraud Unit contacted the defendants, Church Mutual Insurance Company and one of its adjusters, with whom the plaintiff had negotiated several clients' claim settlements. Id. Due in part to these allegations, the OID denied the plaintiff's application. Id. ¶ 5, 452 P.3d at 420. The State of Oklahoma also filed two felony criminal charges against the plaintiff and her subcontractor for filing a false claim of insurance and conspiracy to commit a felony, but the charges were eventually dismissed. Id. ¶ 6, 452 P.3d at 421. ¶27 The plaintiff subsequently brought suit alleging intentional interference with her prospective business opportunity. Id. Specifically, the plaintiff alleged the defendants gave harmful information to the OID to retaliate against her for negotiating higher claim settlements for her clients than the defendants initially offered to pay. Id. The trial court granted summary judgment in favor of the defendants, finding that the defendants were entitled to statutory immunity under § 363(B). Id. ¶ 9, 452 P.3d at 421. We affirmed the trial court finding that the statutory immunity applied: The immunity provisions of §363 expressly apply to either reports made under subsection A, or when an insurer furnishes information, either orally or in writing for an investigation or prosecution of suspected insurance fraud. The terms of the statute, insofar as to when immunity applies, are clear and unambiguous. If Church Mutual, or any other insurer, furnished information for an investigation or prosecution, as they did in this cause, they are protected from civil action for libel, slander or any other relevant tort or any criminal action. The only exception for such immunity is if the insurer provides such information fraudulently, in bad faith, in reckless disregard for the truth, or with actual malice. Id. ¶¶ 15-16, 452 P.3d at 423 (internal citations omitted). ¶28 Defendants claim that the absolute privilege adopted in Kirschstein should apply instead of the qualified immunity outlined in § 363 and applied in Loven. Specifically, Defendants argue that their statements to OID constitute "communications made preliminary to proposed [...] quasi-judicial proceedings" and thus fall within Kirschstein's absolute privilege. See Kirschstein, 1990 OK 8, ¶ 2, 788 P.2d at 945. However, in Kirschstein, the statements which prompted litigation were made to members of the defendant's family, rather than to an administrative agency like OID. Additionally, Kirschstein did not involve an applicable statute, like § 363, establishing qualified immunity for statements made to the relevant administrative agency, nor were we bound in that case by a prior decision from the Court applying the statute in similar circumstances, like Loven. ¶29 Defendants argue Loven is distinguishable from this case because Loven did not address Kirschstein in reaching its holding. The Court in Loven did not address Kirschstein as the facts of those cases reveal that they are obviously distinguishable. Defendants also claim that Loven is distinguishable from this case because it only applies in situations where the defendant reports suspected fraud in the first instance, whereas Defendants here only responded to inquiries from the OID. This is a mischaracterization of Loven. In Loven, the defendant, Church Mutual Insurance Company, was also responding to an inquiry from the Anti-Fraud Unit of the OID when it made allegations that the plaintiff was operating as an unlicensed public adjuster. ¶30 With respect to § 363, Defendants claim that it does not abrogate the common law absolute privilege recognized in Kirschstein. Defendants cite to previous instances where statutes stood in conflict with common law rules, and we held that statutory enactments do not abrogate the common law absent a clear expression of legislative intent. See, e.g., Greenberg v. Wolfberg, 1994 OK 147, 890 P.2d 895; Lee v. Bueno, 2016 OK 97, 381 P.3d 736. We have clarified in those cases, however, that there need not be a clearly expressed legislative intent to abrogate the common law. But rather, if the general intent of the statute is clear and the statute conflicts with a common law rule, the statute will control.8 The Oklahoma Statutes make clear that statutory enactments are to be liberally construed to accomplish their objective and that where they conflict with the common law, statute will control.9 ¶31 In the present matter, we find that the clear and unambiguous intent of § 363 is to provide qualified immunity from civil actions for individuals who furnish information to the OID regarding fraudulent insurance activity. Thus, to the extent that the common law absolute privilege recognized in Kirschstein conflicts with § 363 by affording Defendants a broader immunity than the statute provides, we find that § 363 controls. ¶32 Lastly, Defendants claim that failure by this Court to recognize an absolute privilege for their statements to OID would undermine the Legislature's policy of requiring confidentiality over OID investigations, as expressed in 36 O.S.supp.2016 § 361. Section 361(D) provides, in pertinent part: Records, documents, reports and evidence obtained or created by the Anti-Fraud Unit as a result of an inquiry or investigation of any suspected insurance related crime shall be confidential and shall not be subject to the Oklahoma Open Records Act or to outside review or release by any individual. In the trial court, the OID cited § 361(D) in an attempt to quash a series of subpoenas issued to one of its investigators. Defendants claim it would be unfair to subject them to potential liability for their statements to the OID, while the OID's use of these confidentiality provisions limits Defendants' ability to prove that the investigation was prompted by something other than their statements. ¶33 We disagree. As noted in the OID's Notice of Hearing to Chimento, its investigation was prompted by and relied upon the investigation of the Tulsa Police Department into allegations made by Defendants against Chimento. The allegations in the Notice of Hearing relate exclusively to Chimento's employment by the Defendants.10 Thus, the impetus for the OID's investigation is hardly confidential at this point. Additionally, given our finding that Defendants' statements to law enforcement are subject only to a qualified privilege, it would be absurd to find that, by their incorporation into an OID investigation, they obtain an absolute privilege. ¶34 We find that Defendants' statements to the OID are subject to a qualified privilege under 36 O.S.Supp.2012 § 363. V. CONCLUSION ¶35 On review, we find that Defendants statements to TPD and the District Attorney's Office are entitled to a qualified privilege. Likewise, Defendants statements to the Oklahoma Insurance Department are entitled to a qualified privilege under 36 O.S.Supp.2012 § 363. Accordingly, the trial court's order granting partial summary judgment is affirmed in part and reversed in part. This matter is remanded to the trial court for further proceedings consistent with this opinion. CERTIORARI PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED IN PART, REVERSED IN PART; REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. Rowe, V.C.J., Kauger, J. (by separate writing), Winchester, Edmondson, Gurich, Darby, and Kuehn, JJ., concur. Combs, J., concurs in result. Kane, C.J., not participating. FOOTNOTES 1 A June 19, 2018 docket entry in Chimento's criminal case states, "[DISMISSED] BY COURT, AT REQUEST OF STATE, COST TO STATE. INSUFFICIENT EVIDENCE. BOND EXONERATED." 2 Title 12, Section 1443.1 states: A. A privileged publication or communication is one made: First. In any legislative or judicial proceeding or any other proceeding authorized by law; Second. In the proper discharge of an official duty; Third. By a fair and true report of any legislative or judicial or other proceeding authorized by law, or anything said in the course thereof, and any and all expressions of opinion in regard thereto, and criticisms thereon, and any and all criticisms upon the official acts of any and all public officers, except where the matter stated of and concerning the official act done, or of the officer, falsely imputes crime to the officer so criticized. B. No publication which under this section would be privileged shall be punishable as libel. 3 Section 1443 was the predecessor to § 1443.1 and contained substantively similar terms. 4 In particular, § 587 of the Second Restatement provides: A party to a private litigation or a private prosecutor or defendant in a criminal prosecution is absolutely privileged to publish defamatory matter concerning another in communications preliminary to a proposed judicial proceeding, or in the institution of or during the course and as a part of, a judicial proceeding in which he participates, if the matter has some relation to the proceeding. Additionally, comment b to § 587 states: [The rule] applies to communications made by a client to his attorney with respect to proposed litigation as well as to information given and informal complaints made to a prosecuting attorney or other proper officer preliminary to a proposed criminal prosecution whether or not the information is followed by a formal complaint or affidavit. (emphasis added). 5 The following paragraph from Sovereign Camp explains the situation neatly: Taking up, first, the question of the validity of such provision, the plaintiff relies upon the case of Modern Woodmen of America v. Michelin, 101 Okl. 217, 225 P. 163, 36 A.L.R. 971, which case involved the seven years' absence rule and a clause in the contract that such absence shall not be regarded as evidence of death until after the full term of the member's life expectancy. That case did hold such a clause contrary to public policy and void. However, it was decided, before the Supreme Court of the United States handed down its decision in Modern Woodmen of America v. Mixer, 267 U.S. 544, 45 S. Ct. 389, 69 L. Ed. 783, 41 A.L. R. 1384, wherein the court held that a citizen of one state becoming a member of such a society is bound by a by-law subsequently adopted which is declared valid by the courts of the state of the domicile of the society, that "membership looks to and must be governed by the law of the State granting the incorporation." The case involved the identical question passed upon in the Michelin Case, and by reason of that decision the Michelin Case was practically (but not expressly) overruled by this court in DeVore-Norton v. Brotherhood of Locomotive Firemen, 132 Okl. 130, 270 P. 12, 14, 60 A.L.R. 586, wherein it was stated that "the rule announced in the Mixer Case * * * is controlling in this state." And in Modern Woodmen of America v. Crudup (decided by this court on October 15, 1935, long after the briefs were filed herein) 51 P.(2d) 718 (not reported [in State report]), the Michelin Case was again overruled by implication and the rule announced in the DeVore-Norton Case expressly adopted. Sovereign Camp, Woodmen of the World v. Smith, 1936 OK 198, ¶ 11, 56 P.2d 408, 410. We acknowledged that two of our prior precedents were overruled by implication under similar circumstances in Alexander: The defendants rely on and quote the language from Walker v. Brown, 43 Okla. 144, 141 P. 681, and Wilson v. Greer, 50 Okla. 387, 151 P. 629, but these cases were overruled by implication in Blundell v. Wallace, 96 Okla. 26, 220 P. 40, and as pointed out in Spaniard v. Tanton, 131 Okla. 75, 267 P. 623. Alexander v. Samuels, 1936 OK 260, ¶ 18, 58 P.2d 878. We explained further in Spaniard v. Tanton: To sustain the judgment, counsel cite Walker v. Brown, 43 Okl. 144, 141 P. 681; Wilson v. Greer, 50 Okl. 387, 151 P. 629. These decisions are in conflict with the case above cited, and, such case having been affirmed by the United States Supreme Court, former decisions of this court to the contrary can not longer be considered as authority. Spaniard v. Tanton, 1928 OK 202, ¶ 5. 267 P. 623, 624. 6 While it did not factor into our analysis, we note that this outcome appears to be consistent with the comments to Oklahoma Uniform Jury Instruction 28.8, which describes the affirmative defense of qualified privilege in defamation actions. Specifically, the comments state: Examples of circumstances where this qualified privilege may apply include statements concerning a former employee by a former employer to a prospective employer, reports to police officers, statements by a credit rating agency to a subscriber, communications between members of a trade association, and communications between family members. See RESTATEMENT (SECOND) OF TORTS § 595 (1977) comments g, h, i, and j. (emphasis added). 7 For reference, § 363 provides, in pertinent part: A. Any insurer, employee or agent of any insurer who has reason to believe that a person or entity has engaged in or is engaging in an act or practice that violates any statute or administrative rule of this state related to insurance fraud shall immediately notify the Anti-Fraud Unit of the Insurance Department and, in the case of an allegation of claimant fraud, the Workers' Compensation and Insurance Fraud Unit of the Office of the Attorney General. B. No insurer, employee or agent of an insurer, or any other person acting in the absence of fraud, bad faith, reckless disregard for the truth, or actual malice shall be subject to civil liability for libel, slander or any other relevant tort or subject to criminal prosecution by virtue of filing of reports or furnishing other information either orally or in writing, concerning suspected, anticipated or completed fraudulent insurance acts to the Anti-Fraud Division of the Insurance Department or the Workers' Compensation and Insurance Fraud Unit of the Office of the Attorney General pursuant to subsection A of this section or to any other agency involved in the investigation or prosecution of suspected insurance fraud. 8 In Lee v. Bueno, 2016 OK 97, 381 P.3d 736, we explained: There is no express legislative intent in 12 O.S. 2011 § 3009.1 to abolish the collateral source rule in its entirety, for insured victims of torts or otherwise. Rather, 12 O.S. 2011 § 3009.1 explicitly restricts the admissibility of certain types of evidence. There is no ambiguity in the language and expressed intention of 12 O.S. 2011 § 3009.1, and to the extent it conflicts with operation of the collateral source rule, it controls. Id. ¶ 51, 381 P.3d at 752. 9 Title 12, § 2 provides: The common law, as modified by constitutional and statutory law, judicial decisions and the condition and wants of the people, shall remain in force in aid of the general statutes of Oklahoma; but the rule of the common law, that statutes in derogation thereof, shall be strictly construed, shall not be applicable to any general statute of Oklahoma; but all such statutes shall be liberally construed to promote their object. Additionally, 25 O.S. § 29 states: The rule of the common law, that statutes in derogation thereof are to be strictly construed, has no application to the laws of this state, which are to be liberally construed with a view to effect their objects and to promote justice. 10 Allegation of Fact #6 in the OID's Notice of Hearing states: Respondent's renewal application was denied on October 1, 2019, based upon information and evidence obtained in an investigation conducted by the Oklahoma Anti-Fraud Division, which relied in part on an investigation conducted by the Tulsa Police Department. Allegations of Fact 9-40, which comprise the remainder of the OID's allegations against Chimento, all relate to her employment with Defendants and her handling of the Tribal Sponsorship Program and utilization of the Tribal Account. KAUGER, J., with whom Gurich, J., and Kuehn, J., join concurring: ¶1 I joined Justice Doolin in his concurring in part/dissenting in part in Kirschstein v. Hayes, 1990 OK 8, 788 P.2d 941 because the Court applied absolute privilege, rather than qualified privilege. Obviously, Kirschstein created confusion as to when and how it would apply to other causes. ¶2 Kirschstein did not involve a quasi-judicial proceeding and was, at least partially, wrongly decided. The majority holds that to "the extent any Court of Civil Appeals opinions conflict with this cause, they are overruled." I would not leave the opportunity for more confusion to arise. Rather, I would also overrule Kirschstein, leaving the question of whether it extends absolute privilege to any other cause unnecessary.

3e65ea2a-965c-4697-9cae-7311da529071

Norris v. Pool

oklahoma

Oklahoma Supreme Court

NORRIS v. POOL2023 OK 47Case Number: 118980Decided: 04/25/2023IN THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. JEAN NORRIS a/k/a JEANNIE NORRIS, CAROL MIKLES, and KENNETH HOPCUS, Plaintiffs/Appellees, v. STEVEN POOL, Defendant/Appellant, and STIFEL NICOLAUS & COMPANY, Defendant/Appellee. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 The appellees seek a declaratory judgment recognizing them as the primary beneficiaries of a retirement account belonging to the decedent, their cousin. The appellant, the son of the decedent, counterclaimed, seeking an order declaring him the sole beneficiary based on an executed change of beneficiary form received by the IRA custodian after the death of the decedent. The district court granted summary declaratory judgment in favor of the appellees and determined they are the beneficiaries of the retirement account. The decedent's son timely appealed, and the Court of Civil Appeals affirmed. This Court granted certiorari. We hold that the decedent substantially complied with the requirements of her IRA plan to change her beneficiary to her son, and the IRA funds should be disbursed per the decedent's intent. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; CAUSE REMANDED WITH INSTRUCTIONS TO GRANT SUMMARY JUDGMENT IN FAVOR OF APPELLANT. Randall A. Gill and Randi N. Gill, Gill Law Firm, Tulsa, Oklahoma, for Appellees. Thomas N. Marcum, Burrage Law Firm, Durant, Oklahoma, for Appellant Steven Pool. Winchester, J. ¶1 Appellees Jean Norris a/k/a Jeannie Norris, Carol Mikles, and Kenneth Hopcus (collectively Cousins) brought this action seeking an order declaring Cousins as the primary beneficiaries of an Individual Retirement Account (IRA) belonging to their cousin, Sandra Pool (Decedent), based on the IRA plan language and a beneficiary designation executed by Decedent. Appellant Steven Pool, the son of Decedent (Son), sought an order declaring him the sole beneficiary of the IRA based on a change of beneficiary form received by the IRA custodian, Stifel Nicolaus & Company (Stifel), after Decedent's death. The district court granted summary declaratory judgment in favor of Cousins, determining they were the beneficiaries of the IRA. Son timely appealed, and the Court of Civil Appeals (COCA) affirmed. This Court granted certiorari. ¶2 The very narrow question in this case is whether Stifel had to be in possession of the executed change of beneficiary form prior to Decedent's death to constitute a valid change of beneficiary. We answer this question in the negative. We hold that Decedent substantially complied with all the requirements of the IRA plan language to designate Son as the beneficiary of her IRA account except for Stifel receiving the form in the mail prior to her death. The Court exercises its equitable powers to disburse the IRA funds per Decedent's intent. FACTS AND PROCEDURAL HISTORY ¶3 On August 21, 2012, Decedent opened a traditional IRA account with Stifel. She named Cousins as equal one-third beneficiaries of her IRA account. At the time, Decedent was estranged from Son, but Decedent reconnected with Son at some time prior to her death. ¶4 On November 6, 2017, following her cancer diagnosis and treatment, Decedent contacted Stifel to request a change of beneficiary form. Stifel mailed the form to Decedent the same day. The Stifel beneficiary disclosure for the change of beneficiary form stated: You may designate one or more persons or entities as beneficiary of your IRA. This designation can only be made on a form provided by or acceptable to us, and it will only be effective when it is filed with us during your lifetime. Decedent filled out the change of beneficiary form designating Son as a primary beneficiary and executed it on November 7, 2017. ¶5 On November 15, 2017, Decedent contacted Stifel, stating that she forgot to indicate on her change of beneficiary form what her relationship was with Stephen Pool and Carol Nichols as requested in the document. ¶6 On November 20, 2017, Stifel received Decedent's change of beneficiary form in the mail. Stifel rejected the form because it contained numerous errors, inconsistencies, and missing information.1 Stifel notified Decedent that it could not accept the form and it would be sending her a second change of beneficiary form to execute. Decedent indicated that she would correct the form and mail it back. Stifel sent Decedent a second change of beneficiary form that same day. ¶7 The second change of beneficiary form had preprinted information from Stifel, including that the primary beneficiary was Son receiving 100% of the assets and the contingent beneficiary was Cousin Carol Mikles. On November 24, 2017, Decedent executed the second change of beneficiary form that indicated that Son was the primary beneficiary--the same she had previously attempted to indicate on her original beneficiary form and as she relayed to Stifel. Decedent passed away on December 2, 2017. Stifel received the second change of beneficiary form on December 5, 2017, three days after Decedent's death. ¶8 Stifel did not process the second change of beneficiary form because the form was not filed with Stifel prior to Decedent's death. Son and Cousins all sought distribution of the IRA funds. Due to the competing claims, Stifel restricted distribution. ¶9 Cousins sought a declaratory judgment and injunctive relief, requesting that the district court declare them the beneficiaries of the IRA. Cousins moved for summary judgment. They contended that Stifel properly rejected the change of beneficiary form because the form did not comply with the terms of Decedent's IRA plan and the Internal Revenue Service (IRS) rules and regulations as Stifel received the form in the mail after Decedent's death. ¶10 Son also moved for summary judgment, arguing he was the sole beneficiary of the IRA.2 Son asserted that Decedent had done everything in her power to comply with the IRA plan to name him the beneficiary of the IRA but for Stifel receiving the corrected form in the mail. Therefore, the district court should determine him to be the beneficiary. ¶11 Stifel took no position with respect to the parties' dispute and awaits a judicial determination of the proper beneficiary. ¶12 The district court granted summary judgment in favor of Cousins, determining they were the designated beneficiaries of Decedent's IRA account. Son appealed. COCA affirmed the district court's grant of summary judgment to Cousins. COCA held that the IRA plan language controlled; since Decedent did not file the change of beneficiary form with Stifel prior to her death, the change of beneficiary did not occur. We granted certiorari. STANDARD OF REVIEW ¶13 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the district court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. The Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. ANALYSIS ¶14 Cousins claim that they are the beneficiaries of the IRA, contending that Decedent's change of beneficiary form was invalid because Stifel did not receive the form prior to her death. Son counters that Decedent did everything in her power to name him the beneficiary of the IRA and that we should uphold Decedent's intent. We agree with Son. ¶15 The Court invokes strict compliance with the policy or plan language for the protection of the custodian so that the custodian is not liable to pay a loss more than once. There is no risk of double liability when, as in this case, all claimants are present. Bowser v. Bowser, 1949 OK 200, ¶ 8, 211 P.2d 517, 519. ¶16 Oklahoma has recognized the doctrine of substantial compliance when the owner "has done all in his power to effect a change of beneficiar[y], and after his death only ministerial acts remain to be performed." Harjo v. Fox, 1944 OK 81, ¶ 9, 146 P.2d 298, 301; see also Ivey v. Wood, 1963 OK 281, ¶ 24, 387 P.2d 621, 626. In Gray v. Fidelity Brokerage Services, LLC, 2023 OK 7, ___ P.3d ___, we recently held that the doctrine of substantial compliance can be applied in the context of a beneficiary designation for an IRA. The decedent in Gray executed the relevant IRA rollover documents, including a beneficiary designation that listed each of his children as receiving a certain dollar amount and his wife as receiving the balance. Id. ¶ 8. When the custodian of the IRA advised that the beneficiary designation had to be reflected by a percentage share, the decedent inquired into whether the decedent could designate by a dollar amount instead of a percentage. The custodian allowed this designation by a letter of authorization. Id. ¶ 9. Two days later, the decedent passed away without any further communication from the IRA custodian. The custodian then rejected the beneficiary designation because the decedent's attempted designations exceeded the value of the IRA. Id. ¶ 10. This Court found that the decedent reasonably believed that he had complied with the custodian's requirements and had no reason to believe that he had not properly designated beneficiaries for his IRA. The Court, acting in equity, enforced the attempted beneficiary designation as the owner of the account had done everything in his power to designate his beneficiaries. Id. ¶ 23. ¶17 In the same way, the substantial compliance doctrine should apply to our present analysis.3 The remaining issue is whether Son provided sufficient evidence to meet the standard for substantial compliance concerning Decedent's change of beneficiary to her IRA. ¶18 In this case, Decedent's attempt to designate a new beneficiary of her IRA comes within the purview of the doctrine. We find guidance in cases from our Court where a decedent had executed a change in beneficiary form or equivalent writing, but some ministerial act mandated by the custodian was not completed. The Court held a beneficiary change valid as it gave effect to the intent of the decedent where the decedent did everything in his or her power to fulfill that ministerial act. ¶19 In Bowser, 1949 OK 200, 211 P.2d 517, an insured attempted to change the beneficiary on his insurance policy by executing and delivering his request for a beneficiary change to the insurance company. The policy provided that a change of beneficiary could only be made by filing a written notice and delivering the insured's policy to the company. Id. ¶ 5, 211 P.2d at 519. The insured never endorsed the change of beneficiary on his insurance policy nor forwarded the policy to the company prior to his death. The evidence disclosed that the insured made two efforts to change his beneficiary. In his first application, the insured stated the policy was lost. In his second application, the insured stated his former wife was in possession of the policy but refused to deliver the policy to him. Id. ¶ 6, 211 P.2d at 519. The Court found that the insured had done everything in his power to change the beneficiary to the insurance policy. The insured had attempted to obtain the policy but was unable to because of his former wife's refusal. The Court allowed the change of beneficiary without fulfilling the policy's requirement of delivering the endorsed policy to the insurance company. Id. ¶ 10, 211 P.2d at 520. ¶20 In New York Life Ins. Co. v. Wilson, 1937 OK 590, 73 P.2d 1133, an insured executed the proper change of beneficiary forms, and the insured transmitted the forms to the home office of the insurance company prior to his death. Id. ¶ 2, 73 P.2d at 1134. However, an endorsed insurance policy was not attached to his request to change his beneficiary as the policy required. The insurance company received the policy over a month after the insured's death. Id. ¶ 15, 73 P.2d at 1136. The Court found that the insured did everything in his power to deliver the policy within the shortest possible time since he was in Arkansas and the policy was in Oklahoma. And the Court gave effect to the insured's intent to change his beneficiary. Id. ¶ 18, 73 P.2d at 1136. ¶21 Conversely, in Carson v. Carson, 1933 OK 549, 26 P.2d 738, an insured failed to present an endorsed policy to the insurance company. The Court found that the insured did not do everything in his power to change his beneficiary, concluding that the insurance company twice called to the insured's attention five months prior to his death that the company was insisting upon a return of the policy and the endorsement of the change of beneficiary as required by the policy. Yet the insured took no further steps to obtain possession of the policy and thereby in effect abandoning his effort to change the beneficiary. Id. ¶ 20, 26 P.2d at 741; see also O'Neal v. O'Neal, 1942 OK 426, ¶¶ 11, 15, 141 P.2d 593, 597-98 (holding the insured did not do everything in his power to change the beneficiary of his insurance policy because the insured did not make a demand on the person in possession of the policy to deliver the policy to the insured). ¶22 We hold that the facts in this case are akin to Bowser and Wilson as Decedent took multiple steps to change her beneficiary. It is undisputed that approximately 25 days before her death, Decedent contacted Stifel to request a change of beneficiary form. Stifel mailed the form to Decedent the same day. Stifel received in the mail Decedent's executed change of beneficiary form, but Stifel rejected the form because it contained numerous errors and missing information. Stifel contacted Decedent to explain the issues regarding her change of beneficiary form, and a new form was sent to Decedent the same day. Stifel was aware that Decedent intended to change her beneficiary to Son because Stifel preprinted information on the second beneficiary form prior to sending it to Decedent, including printing Son's name as the primary beneficiary. The second change of beneficiary form was executed by Decedent prior to her death. However, the form was not received by Stifel until three days after her death. ¶23 Further, Son communicated to Stifel that Decedent mailed the second change of beneficiary form prior to her death. We note that the first change of beneficiary form took at least five days to mail from Decedent in Texas to Stifel in Oklahoma. Decedent called on Wednesday, November 15, 2017, to indicate that she had made a mistake on the first form that she had already mailed to Stifel. Yet Stifel did not receive the first form until Monday, November 20, 2017. Stifel received the second change of beneficiary form on Tuesday, December 5, 2017. Decedent passed away on Saturday, December 2, 2017. Because Decedent's death fell on Saturday and Stifel received the second form on Tuesday, there was only one business day between the time of her passing and the time Stifel received the second change of beneficiary form. The evidence demonstrates with substantial certainty that Decedent mailed the second change of beneficiary form before the date of her death, and Decedent reasonably believed that she had complied with Stifel's requirements to change the beneficiary of her IRA at the time of her death. Like in Bowser and Wilson, we hold the evidence in this case demonstrates that Decedent had done everything in her power to effectuate her change of beneficiary, including the ministerial act of mailing the form to Stifel.4 ¶24 Cousins contend that the federal rules and regulations that govern IRA accounts require that all change of beneficiary forms must be received by the account administrator before the death of the account owner. We disagree. IRS regulations that govern IRAs expressly provide for distributions of the IRA to beneficiaries upon the death of the owner and define "beneficiaries" to include "any person designated by the [owner] to share in the benefits of the account after [the] death of the [owner]." 26 C.F.R. § 1.408-2(b)(7), (8) (2022). To be a designated beneficiary, an individual must be a beneficiary designated as of the date of death. 26 C.F.R. § 1.401(a)(9)-4 (2022); Distributions from Individual Retirement Arrangements, IRS Publication 590-B (2017), available at https://www.irs.gov/publications/p590b. No federal rules or regulations state that the change of beneficiary form must be filed or that the account administrator must receive the form before the death of the account holder. The only requirement is that the beneficiary is designated prior to the death of the owner of the IRA. ¶25 It is undisputed that Decedent communicated with Stifel her intention to change her beneficiary and executed the second change of beneficiary form before her death. Further, the evidence indicates that the second form had been mailed to Stifel. Therefore, Decedent complied with the federal rules and regulations that govern IRA accounts when she executed the second change of beneficiary form and mailed it to Stifel, designating her Son as the beneficiary of Decedent's IRA before her death. CONCLUSION ¶26 Decedent substantially complied with all the requirements to change the beneficiary of her IRA account, and the Court uses its equitable powers to give effect to Decedent's intent to name Son as the beneficiary of her IRA. Based upon our analysis, we reverse the district court's judgment in favor of Cousins and the cause is remanded with instructions for the district court to grant summary judgment in favor of Appellant Steven Pool. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; CAUSE REMANDED WITH INSTRUCTIONS TO GRANT SUMMARY JUDGMENT IN FAVOR OF APPELLANT. Kane, C.J., Kauger, Winchester, Edmondson, Combs, and Kuehn, JJ., concur. Rowe, V.C.J. (by separate writing), and Darby, J. (by separate writing), dissent. Gurich, J., recused. FOOTNOTES 1 Decedent designated two primary beneficiaries, but she mistakenly wrote her own name in a space. She marked through her name and wrote Son's name in the space for Primary Beneficiary #1, without initialing the change. She also designated that both beneficiaries were to receive 100% of the assets. She further failed to indicate her marital status. 2 The parties agreed that the facts were undisputed and stipulated that the question was one of law for the district court to determine. 3 Other jurisdictions have also applied the substantial compliance doctrine to a change of beneficiary for an IRA. See, e.g., In re Estate of Golas, 751 A.2d 229, 232-33 (Pa. Super. Ct. 2000) (invoking substantial compliance to affirm the award of proceeds of an IRA account to the executors of the accountholder's estate, instead of the first designated beneficiary, where a terminally ill accountholder requested change of beneficiary forms but failed to receive them before his death); In re Estate of Freeberg, 122 P.3d 741, 744 (Wash. 1974) (holding that an insured substantially complied with the IRA custodian's requirement to change a beneficiary by personally asking the custodian to make the change on his investment and IRA accounts). Other jurisdictions have applied a similar "clearly expressed intent" test. See, e.g., Gen. Mills Fed. Cred. Union v. Lofgren, 839 N.W.2d 766, 773 (Minn. 2013) (concluding that the district court may apply equitable principles to determine that the named beneficiary is not the rightful beneficiary if the evidence warrants such determination); LeBlanc v. Wells Fargo, 981 N.E.2d 839, 847 (Ohio 2012) (noting that if an IRA custodian files an interpleader action, and the account owner's intent to change beneficiaries was clearly communicated to the custodian, the proceeds will be paid to the newly designated beneficiary rather than to the original beneficiary). 4 The language of the IRA plan states that the change of beneficiary is only effective when it is filed. However, the plan does not define filed. We note that our Court follows the mailbox rule which specifies that the date of mailing shall constitute the date of filing. 12 O.S.2021, § 990A(B). The purpose of the application of the mailbox rule in this Court is so appellants who do not live within a reasonable driving distance of Oklahoma City are not at a disadvantage to those who do, allowing for "evenhanded statewide application." Whitehead v. Tulsa Pub. Sch., 1998 OK 71, ¶ 5, 968 P.2d 1211, 1213. Although the mailbox rule enunciated in section 990A applies expressly to appeals to the Supreme Court, its common law predecessor was not so limited and was articulated as a rule of contract law. See Johnson v. Tony's Town Mister Quick, 1996 OK 138, ¶ 4 n.4, 915 P.2d 355, 357 n.4. We believe the application of the mailbox rule could benefit a decedent in a case of this nature. The purpose of deeming a form filed at the time of mailing would allow for compliance with the IRA plan language for those instances where the form is mailed prior to a decedent's death but received by the custodian after the decedent's death. ROWE, V.C.J., dissenting: ¶1 I recently dissented in Gray v. Fidelity Brokerage Services, 2023 OK 7, ___ P.3d ___ to the majority's application of the doctrine of substantial compliance. I dissent today for the same reason. ¶2 In Gray, the majority applied the arbitrary equitable doctrine of substantial compliance to reform a mistake made by the decedent on a beneficiary designation form for an IRA account. The majority determined the decedent's attempt to designate beneficiaries to his IRA came within the purview of the substantial compliance doctrine by concluding that the decedent, prior to his death, reasonably believed he had "done everything in his power to designate beneficiaries and followed Fidelity's instructions." Id. ¶ 23, __ P.3d, ___. ¶3 As in Gray, the majority, "acting in equity,"1 applies the doctrine of substantial compliance because the decedent "[did] everything in her power to effectuate her change of beneficiary,"2 thereby reversing the trial court's legal finding that decedent failed to comply with the IRA plan's contractual language. The majority's reversal of the trial court's ruling--a reversal rooted in equity--is inconsistent with our jurisprudence and will serve to promote inconsistency within our appellate jurisprudence. ¶4 IRA accounts are governed by federal rules and regulations. 26 CFR 1.401(a)(9)-4 specifically provides: A designated beneficiary is an individual who is designated as a beneficiary under the plan. An individual may be designated as a beneficiary under the plan either by the terms of the plan or, if the plan so provides, by an affirmative election by the employee (or the employee's surviving spouse) specifying the beneficiary. (Emphasis added). The terms of decedent's IRA plan allowed her to designate beneficiaries subject to the fulfillment of certain requirements. One of those requirements being that she change her beneficiary and file of record with the custodian prior to her date of death. This specific requirement was not fulfilled in this case. According to the terms of the IRA plan, decedent's attempt to change the beneficiary of her IRA was ineffective. ¶5 Further, 26 CFR 1.401(a)(9)-4 provides: "In order to be a designated beneficiary, an individual must be a beneficiary as of the date of death." Decedent passed away before the custodian received and filed the change. The majority attempts to tip-toe around this requirement by finding that because decedent mailed the change prior to her death, the mailing date constitutes the date of filing. The majority reaches this conclusion by finding that 12 O.S.2021, § 990(A)(B)3--which adopts the mailbox rule as the date of filing for a petition in error with this Court--now applies to IRA plans. Nowhere does our jurisprudence extend § 990(A)(B) beyond the filing of petitions in error with this Court. The majority's spinning of this statute to justify its desired equitable outcome is yet another departure from our jurisprudence. ¶6 Moreover, the IRA plan was a contractual agreement between decedent and Stifel. "The paramount objective of contract interpretation is to effectuate the intent of the parties as expressed by the terms of the contract." Walker v. Builddirect.Com Techs. Inc., 2015 OK 30, ¶ 9, 349 P.3d 549, 552. When decedent contracted with Stifel, she accepted the terms of the IRA plan, which clearly outlined the requirements necessary to change a designated beneficiary. The majority's equitable expedition to obviate the express language of the IRA plan is an intrusion on the parties' right to contract. "Absent illegality, the parties are free to [contract] as they see fit, and the court may neither make a new contract, nor rewrite the existing contract." Oxley v. Gen. Atl. Res., Inc., 1997 OK 46, ¶ 14, 936 P.2d 943, 945--46. Accordingly, I respectfully dissent. FOOTNOTES 1 Majority Opinion, ¶ 16. 2 Id. ¶ 23. 3 The filing of the petition in error may be accomplished either by delivery or mailing by certified or first-class mail, postage prepaid, to the Clerk of the Supreme Court. The date of filing or the date of mailing, as shown by the postmark affixed by the post office or other proof from the post office of the date of mailing, shall constitute the date of filing of the petition in error. If there is no proof from the post office of the date of mailing, the date of receipt by the Clerk of the Supreme Court shall constitute the date of filing of the petition in error. Darby, .J., dissenting: ¶1 I respectfully dissent because the Nonprobate Transfers1 Law of Missouri, Mo. Ann. Stat. §§ 461.003--461.081 (West), provides that a beneficiary change relates back to and is effective as of the time when the change request was received by the IRA custodian, or "transferring entity."2 Mo. Ann. Stat. § 461.012(3) (West). The parties in this case seek a court's determination about the lawful owner of an IRA account now that the Mrs. Pool, the owner,3 has passed away. The dispute arises between parties that seek to be declared the rightful beneficiary(ies)4 of the IRA account. Mrs. Pool opened an IRA account with Stifel, Nicolaus & Company. At that time, Stifel provided her with the Stifel Account Agreement and Disclosure Booklet. Stifel's basic terms and conditions require the agreement and any transactions to be construed and governed by the laws of Missouri. Stifel Account Agreement and Disclosure Booklet at p. 9. ¶2 An IRA account is made nontestamentary by statute. Mo. Ann. Stat. § 461.001 (West). Under Missouri law, the transfer of the IRA account to a beneficiary is subject to the agreement between the owner and the transferring entity, in this case--Mrs. Pool and Stifel. See Mo. Ann. Stat. § 461.012 (West). This is true when the submission to the transferring entity (Stifel) of a beneficiary designation5 is required under the governing instrument. Mo. Ann. Stat. § 461.012 (West). The law further provides the rule for when a beneficiary change is effective. Mo. Ann. Stat. § 461.012(3) (West). "When a beneficiary designation, revocation or change is subject to acceptance by a transferring entity, the transferring entity's acceptance of the beneficiary designation, revocation or change relates back to and is effective as of the time when the request was received by the transferring entity." Id. ¶3 This case was appealed from an order granting summary judgment. The law is clear about when the beneficiary change relates back to and is effective. There is no dispute that Stifel received the beneficiary form to change Steven Pool as the sole beneficiary on December 5, 2017. Additionally, there is no dispute that Mrs. Pool died on December 2, 2017. The terms of Stifel Agreement require the beneficiary designation to be "made on a form provided by or acceptable to [Stifel], and ... will only be effective when it is filed with [Stifel] during [Mrs. Pool's] lifetime. The beneficiary change related back to and is considered effective the date Stifel received the form, December 5, 2017, after Mrs. Pool's death. Therefore, I would affirm the district court. FOOTNOTES 1 A "nonprobate transfer" is "a transfer of property taking effect upon the death of the owner, pursuant to a beneficiary designation." Mo. Ann. Stat. § 461.005(7) (West). 2 "Transferring entity" means "a person who owes a debt or is obligated to pay money or benefits, render contract performance, deliver or convey property, or change the record of ownership of property on the books, records and accounts of an enterprise or on a certificate or document of title that evidences property rights, and includes any governmental agency, business entity or transfer agent that issues certificates of ownership or title to property and a person acting as a custodial agent for an owner's property." Mo. Ann. Stat. § 461.005(16) (West). 3 "Owner" is "a person or persons having a right, exercisable alone or with others, regardless of the terminology used to refer to the owner in any written beneficiary designation, to designate the beneficiary or a nonprobate transfer, and includes joint owners." Mo. Ann. Stat. § 461.005(8) (West). 4 "Beneficiary" is "a person or persons designated or entitled to receive property pursuant to a nonprobate transfer on surviving one or more persons." Mo. Ann. Stat. § 461.005(1) (West). 5 "Beneficiary designation" is "a provision in writing that is not a will that designates the beneficiary of a nonprobate transfer, including the transferee in an instrument that makes the transfer effective on death of the owner, and that complies with the conditions of any governing instrument, the rules of any transferring entity and applicable law." Mo. Ann. Stat. § 461.005(2) (West).

09007284-579f-4129-a544-05b385f63a9a

In the Matter of S.J.W.

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF S.J.W.2023 OK 49Case Number: 119404Decided: 04/25/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF S.J.W., MINOR CHILD STEPHEN and MORGAN WILBURN Respondents/Appellants,v.STATE OF OKLAHOMA, Petitioner/Appellee. ON APPEAL FROM THE DISTRICT COURT OF CARTER COUNTY,STATE OF OKLAHOMA HONORABLE DENNIS MORRIS, DISTRICT JUDGE ¶0 The deprived adjudication of a Muscogee (Creek) Indian child domiciled in the Chickasaw Nation's reservation results in concurrent state and tribal jurisdiction. 25 U.S.C. § 1911(b) (2018). Under the Indian Child Welfare Act (ICWA), 25 U.S.C. §§ 1901 et seq., an Indian tribe has exclusive territorial jurisdiction over member Indian children domiciled within the external boundaries of their reservation. 25 U.S.C. § 1911(a). ICWA does not oust the State of its subject matter jurisdiction. MOTION TO DISMISS IS DENIED; ORDER OF THE DISTRICT COURTIS AFFIRMED. Phillip P. Owens II, OWENS LAW OFFICE, PC, Oklahoma City, Oklahoma, for Respondents/Appellants, Jessica L. Dice, CARTER COUNTY DISTRICT ATTORNEY'S OFFICE, Ardmore, Oklahoma, for Defendant/Appellee. OPINION Darby, J.: SUMMARY ¶1 After the Carter County District Court adjudicated S.J.W., child, deprived, Parents (Appellants) appealed. S.J.W., through child's attorney, filed a motion to dismiss the appeal for lack of subject matter jurisdiction. S.J.W. claims the Chickasaw Nation has exclusive jurisdiction pursuant to 25 U.S.C. § 1911(a) based on the plain language in the Indian Child Welfare Act (ICWA), 25 U.S.C. §§ 1901 et seq., because S.J.W. resides within the Chickasaw reservation, notwithstanding the fact that S.J.W. is an Indian child and member of the Muscogee (Creek) Nation. Parents adopted S.J.W.'s argument as their first proposition of error. Alternatively, Parents argue if the district court does have jurisdiction, the trial court denied them due process in failing to complete the adjudication within the statutory time period allowed per 10A O.S. 2011, § 1-4-601(B)(2) ("If the adjudicatory hearing is delayed pursuant to this subsection, the emergency custody order shall expire unless the hearing on the merits of the petition is held within one hundred eighty (180) days after the actual removal of the child."). ¶2 On appeal, Parents raise two issues: first, whether Oklahoma courts have subject matter jurisdiction over a nonmember Indian child's deprived case arising in Carter County, which is completely within the external, territorial boundaries of the Chickasaw reservation;1 and second, if the court does have jurisdiction, whether a delay in the adjudication hearing deprived Parents of their due process rights. With respect to the first issue, we hold the district court has subject matter jurisdiction to adjudicate S.J.W. deprived. Pursuant to 25 U.S.C. § 1911(b), the State of Oklahoma shares concurrent territorial jurisdiction with an Indian child's tribe when the Indian child is not domiciled or residing on the Indian child's tribe's reservation.2 In our dual federalism system, an Oklahoma district court's subject matter jurisdiction may be limited by the Oklahoma or U.S. Constitution. U.S. Const., amend. X; Okla. Const. art. I, §§ 1, 7(a). In this case, the State's authority is not ousted by federal law. See 25 U.S.C. § 1911(b). ¶3 Next we find no violation of Parents' right to due process of law as any delay was not arbitrary, oppressive or shocking to the conscience of the court, and Parents had a meaningful opportunity to defend throughout the proceeding. Flandermeyer v. Bonner, 2006 OK 87, ¶ 10, 152 P.3d 195. See also In re A.M., 2000 OK 82, ¶ 9, 13 P.3d 484 ("In the context of a proceeding to terminate parental rights, the essence of procedural due process is a 'meaningful and fair opportunity to defend.'"). PROCEDURAL HISTORY ¶4 This case started in the spring of 2020, at the beginning of the COVID-19 pandemic. S.J.W. was born March 16, 2020--the same day this Court entered its first emergency order due to the outbreak of the novel coronavirus.3 S.J.W. was taken into custody two days later on March 18, 2020.4 At the end of March, the State filed its petition to adjudicate S.J.W. deprived. The State alleged: Morgan Rippetoe,5 Mother, and Stephen Craig Wilburn, Father, posed a threat of harm to S.J.W.; reported Mother had mental health issues; and that both Parents have a history of domestic violence. The petition claimed the district court had jurisdiction pursuant to the Uniform Child Custody Jurisdiction Enforcement Act (UCCJEA), 43 O.S. 2011, §§ 551-101 et seq., and 10A O.S. 2011, § 2-2-102, and that ICWA and the Oklahoma Indian Child Welfare Act, 10 O.S.2011, §§ 40, et seq. applied because S.J.W. was eligible for enrollment with an Indian tribe. ¶5 The State filed the notice of child custody proceedings on May 27, 2020. The notice comported with ICWA requirements, reported S.J.W.'s tribal affiliation as Muscogee Creek, and listed the initial hearing for June 23, 2020. All parties appeared on June 23rd. On July 16th, Parents filed a motion to continue and requested additional time to present their case. The district court agreed and continued the hearing to August 5, 2020. On September 21st, Parents filed a "Motion to Dismiss Deprived Petition" claiming the delay in holding the adjudicatory hearing violated Oklahoma law and required dismissal of the State's petition. The very next day, on the State's motion, the district court set the matter for hearing within two weeks. On October 20th the State filed its witness and exhibit list, and on the 23rd of October the hearing reconvened and testimony was taken. The State's case continued to November 20th. On December 7, 2020, and February 12, 2021, Parents presented their arguments. The district court entered its order adjudicating S.J.W. deprived on February 12, 2021. ¶6 Mother and Father appealed alleging three propositions of error.6 After the appeal commenced, S.J.W., by and through his attorney, filed a motion to dismiss the appeal for lack of subject matter jurisdiction alleging for the first time that neither the Carter County District Court nor the Oklahoma Supreme Court has subject matter jurisdiction of this case based on the United States Supreme Court's decision in McGirt v. Oklahoma, 591 U.S. ___, 140 S. Ct. 2452, 207 L. Ed. 2d 985 (2020), and Bosse v. Oklahoma, 2021 OK CR 30, 499 P.3d 771. Parents adopted S.J.W.'s argument that the State lacked subject matter jurisdiction to adjudicate S.J.W. deprived. We retained this case. STANDARD OF REVIEW ¶7 When a case comes before us on appeal, this Court has a duty to inquire into our own jurisdiction as well as the jurisdiction of the lower court. Broadway Clinic v. Liberty Mut. Ins. Co., 2006 OK 29, ¶ 25, 139 P.3d 873, 880. "When there are no contested jurisdictional facts, the question of subject matter jurisdiction is purely one of law which we review de novo." Reeds v. Walker, 2006 OK 43, ¶ 10, 157 P.3d 100, 107 (footnotes omitted). Whether a delay in the adjudication hearing constituted a due process violation is reviewed de novo. See In re A.M., 2000 OK 82, ¶ 6, 13 P.3d 484, 486-87. "De novo review requires an independent, non-deferential re-examination of another tribunal's legal rulings." Id. (citations omitted). ANALYSIS ¶8 S.J.W. and Parents claim that the application of McGirt7 and Bosse8 require the dismissal of this case for lack of subject matter jurisdiction. They argue the Chickasaw tribal court has exclusive jurisdiction per 25 U.S.C. § 1911(a) regardless of the fact that S.J.W. is a nonmember Indian child. Essentially, Parents argue that if any Indian child is domiciled or residing on any Indian reservation then the tribe with the reservation has exclusive subject matter jurisdiction regardless of whether the Indian child is a member of that tribe. The first proposition of error raises two significant questions: first, whether § 1911's "jurisdiction" is subject matter jurisdiction, and second, whether § 1911(a) applies. 1. JURISDICTION OF THE DISTRICT COURT A. SUBJECT MATTER JURISDICTION ¶9 At the heart of ICWA is its jurisdictional statute, which primarily concerns whether an Indian child's domicile is within the reservation of the Indian child's tribe. See Miss. Band of Choctaw Indians v. Holyfield, 490 U.S. 30, 36, 109 S. Ct. 1597, 1601-02, 104 L. Ed. 2d 29 (1989).9 Subject matter jurisdiction cannot be waived. See In re A.N.O., 2004 OK 33, ¶ 9, 91 P.3d 646, 649. See also In re B.H. & A.H., 2022 OK 80, ¶ 3 (Kane, V.C.J., concurring specially) (noting the importance of the type of jurisdiction at issue in ICWA's jurisdictional statutory scheme). "[T]he word 'jurisdiction' is such a chameleon." See Moore v. Olson, 368 F.3d 757, 759 (7th Cir. 2004). While courts have ascribed different meanings to the general term "jurisdiction," questions challenging the district court's subject matter jurisdiction only concern those which allege a defect in the court's adjudicatory competence. Id. (citing Kontrick v. Ryan, 540 U.S. 443, 124 S. Ct. 906, 157 L. Ed. 2d 867 (2004)). But the word "jurisdiction" can also refer to the territory of the judicial district, among other things. Moore, 368 F.3d at 759-60. ¶10 Territorial jurisdiction refers to a sovereign's--a nation's or state's-- "prerogative to control and regulate activities within its boundaries," which "is an essential, definitional element of sovereignty." Laker Airways Ltd. v. Sabena, Belgian World Airlines, 731 F.2d 909, 921 (D.C. Cir.1984). In most instances, the locus of the person, conduct, or harm provides the basis for jurisdiction, but citizenship of an individual is also recognized as a basis to support jurisdiction. Id. at 921--22 (footnotes omitted). In some instances, "two or more [sovereigns] may have legitimate interests in prescribing governing law over a particular controversy," and therefore "these jurisdictional bases are not mutually exclusive" but rather "often give rise to concurrent jurisdiction." Id. at 922. "Concurrent jurisdiction does not necessarily entail conflicting jurisdiction. The mere existence of dual grounds of prescriptive jurisdiction does not oust either one of the regulating forums." Id. at 926. ¶11 Territorial jurisdiction, as a concept of international law, is important in our state because Oklahoma's territory includes Indian reservations. See Castro-Huerta, 2491-92.10 This is so because "Indian tribes are unique aggregations possessing attributes of sovereignty over both their members and their territory." See Montana v. U.S., 450 U.S. 544, 563, 101 S. Ct. 1245, 1257, 67 L. Ed. 2d 493 (1981) (quotations omitted). The U.S. Supreme Court in Montana, acknowledging the tribes' limited sovereignty, explained the nature of those retained inherent powers by tribes and those divested: "The areas in which such implicit divestiture of sovereignty has been held to have occurred are those involving the relations between an Indian tribe and nonmembers of the tribe .... These limitations rest on the fact that the dependent status of Indian tribes within our territorial jurisdiction is necessarily inconsistent with their freedom independently to determine their external relations. But the powers of self-government, including the power to prescribe and enforce internal criminal laws, are of a different type. They involve only the relations among members of a tribe. Thus, they are not such powers as would necessarily be lost by virtue of a tribe's dependent status." Id. citing U.S. v. Wheeler, 435 U.S. 313, 98 S. Ct. 1079, 55 L. Ed. 2d 303. At play in Oklahoma is the interaction of the state's general subject matter jurisdiction, which is coextensive with her territorial borders, and that of the tribe's territorial jurisdiction, which relates to the tribe's retained inherent sovereign powers as a tribal nation within the territorial boundaries of the United States. Inherent power extends to punish tribal offenders, determine tribal membership, regulate domestic relations among members, and to prescribe rules of inheritance for members. Id., 564. "But exercise of tribal power beyond what is necessary to protect tribal self-government or to control internal relations is inconsistent with the dependent status of the tribes and so cannot survive without express congressional delegation." Id. (citations omitted). ¶12 Different from territorial jurisdiction, Parents' and S.J.W.'s specific challenge here is to the district court's subject matter jurisdiction. Subject matter jurisdiction is the "power to deal with the general subject involved in the action" and includes the power of the court "to proceed in a case of the character presented, or power to grant the relief sought" Dutton v. City of Midwest City, 2015 OK 51, ¶ 16, 353 P.3d 532, 539 (footnotes omitted). It is primary and fundamental in every case. Pointer v. Hill, 1975 OK 73, ¶ 14, 536 P.2d 358, 361. Subject matter jurisdiction cannot be waived by the parties or conferred upon the court by the parties' consent; it may be challenged at any time in the course of the proceedings. In re A.N.O., 2004 OK 33, ¶ 9, 91 P.3d 646, 649. Subject matter jurisdiction is invoked by the pleadings filed with the district court. State ex rel. Okla. Tax Comm'n v. Texaco Exploration, 2005 OK 52, ¶ 14, 131 P.3d 705, 709; Okla. Dep't of Sec. ex rel. Faught v. Blair, 2010 OK 16, ¶ 19, 231 P.3d 645, 657--58, as corrected (Apr. 6, 2010). ¶13 To understand the extent of an Oklahoma district court's subject matter jurisdiction we start with a constitutional premise: district courts are courts of "unlimited original jurisdiction of all justiciable matters except as otherwise provided in this Article, and such powers of review of administrative action as may be provided by statute." Okla. Const. art. VII, § 7(a). Our district courts are courts of general subject matter jurisdiction, that is, general adjudicative authority. Id. State district courts are presumed to have subject matter jurisdiction. Id. The adjudicatory authority of district courts is comprehensive and only limited by the Oklahoma Constitution and the U.S. Constitution. U.S. Const., amend. X. ("The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."). Under our dual-federalism system of government, our state's sovereignty is concurrent with that of the federal government, but subject to limitations imposed by the U.S. Constitution and the supremacy clause. Id.; see also Lewis v. Sac & Fox Tribe of Okla. Hous. Auth., 1994 OK 20, ¶¶ 15-16, 896 P.2d 503, 510-11. When federal Indian law issues arise, we must take special care to determine if federal law preempts or ousts11 the state of its general adjudicative authority. Id. When determining jurisdictional disputes for cases arising within the external boundaries of a reservation, we must remember that Oklahoma's sovereignty does not stop at reservation borders. Castro-Huerta, 597 U.S. at ___, 142 S. Ct. at 2488. The U.S. Constitution authorizes Oklahoma district courts to exercise jurisdiction in Indian country--Oklahoma's territory includes "Indian country." Id. at 2493. Indian country is part of the State, not separate from the State. To be sure, under [the United States Supreme Court's] precedents, federal law may preempt that state jurisdiction in certain circumstances. But otherwise, as a matter of state sovereignty, a State has jurisdiction over all of its territory, including Indian country. See U.S. CONST., Amdt. 10. Id. The general rule is that Oklahoma is "'entitled to the sovereignty and jurisdiction over all the territory within her limits.'" Id. (citing Lessee of Pollard v. Hagan, 44 U.S. (3 How.) 212, 228, 11 L. Ed 565 (1845)). ¶14 The State of Oklahoma by its Constitution has broadly authorized its district courts to exercise subject matter jurisdiction over "all justiciable matters" unless otherwise noted in the Constitution. Okla. Const. art. VII, § 7(a). Adjudicating children deprived surely is a "justiciable matter." Ibid. While the parties refer to ICWA's general reference to "jurisdiction" as "subject matter jurisdiction," we decline to accept this characterization. This is especially so given the presumption of a district court's general adjudicatory jurisdiction.12 ICWA's jurisdictional statute is found at 25 U.S.C. § 1911. Whether § 1911's "jurisdiction" means "subject matter jurisdiction" has received little attention, but requires our review. Section 1911 reads as follows: (a) Exclusive jurisdictionAn Indian tribe shall have jurisdiction exclusive as to any State over any child custody proceeding involving an Indian child who resides or is domiciled within the reservation of such tribe, except where such jurisdiction is otherwise vested in the State by existing Federal law. Where an Indian child is a ward of a tribal court, the Indian tribe shall retain exclusive jurisdiction, notwithstanding the residence or domicile of the child. (b) Transfer of proceedings; declination by tribal courtIn any State court proceeding for the foster care placement of, or termination of parental rights to, an Indian child not domiciled or residing within the reservation of the Indian child's tribe, the court, in the absence of good cause to the contrary, shall transfer such proceeding to the jurisdiction of the tribe, absent objection by either parent, upon the petition of either parent or the Indian custodian or the Indian child's tribe: Provided, That such transfer shall be subject to declination by the tribal court of such tribe. (c) State court proceedings; interventionIn any State court proceeding for the foster care placement of, or termination of parental rights to, an Indian child, the Indian custodian of the child and the Indian child's tribe shall have a right to intervene at any point in the proceeding. (d) Full faith and credit to public acts, records, and judicial proceedings of Indian tribesThe United States, every State, every territory or possession of the United States, and every Indian tribe shall give full faith and credit to the public acts, records, and judicial proceedings of any Indian tribe applicable to Indian child custody proceedings to the same extent that such entities give full faith and credit to the public acts, records, and judicial proceedings of any other entity. 25 U.S.C. § 1911(a)-(b)(emphasis added). ¶15 Subject to emergencies13 and agreements otherwise,14 § 1911 describes ICWA's default "dual-jurisdictional scheme" for "child custody proceedings"15 involving "Indian Child[ren]."16 Miss. Band of Choctaw Indians v. Holyfield, 490 U.S. 30, 36, 109 S. Ct. 1597, 1601-02, 104 L. Ed. 2d 29 (1989). ICWA includes procedural and substantive standards for proceedings in state courts. Id. Under §1911, jurisdiction is either established exclusively in the tribe or concurrently with the state; it is a dichotomy. Id.; Holyfield, 36. The jurisdictional scheme places domicile as the preeminent factor; it's the connection to the forum that is the primary consideration on which jurisdiction turns. This section operates as a procedural safeguard to ensure the right sovereign decides the child custody proceeding. ¶16 The State of Oklahoma presumably has territorial jurisdiction over child custody proceedings unless ousted or preempted. U.S. Const., amend. X; § 1911(a). Oklahoma's territorial jurisdiction extends to her borders and is coextensive with the constitutional grant of subject matter jurisdiction, but the two can be confused for the other. It has been noted that [o]ccasionally the courts have offhandedly referred to [a defect in the court's ability to act within its borders or with respect to certain persons] as going to subject-matter jurisdiction. But, confusing terminology aside, this is decidedly not a matter of subject-matter jurisdiction. The lack of notice or connection to the forum goes to personal or territorial jurisdiction. And that sort of jurisdiction has long been understood as subject to the law of preservation and waiver--in that a failure to raise a personal jurisdiction defense at the first opportunity results in a forfeiture, and the matter is not the court's to raise. See In re adoption of B.B., 2017 UT 59, ¶135, 417 P.3d 1, 42 (Lee, A.C.J., dissenting)(emphasis added). ¶17 When a child appears before a district court judge and is subsequently determined to be a member Indian, the district court maintains subject matter jurisdiction. But the sovereign status of a tribe and its territorial jurisdiction over its members and territory necessitates disposition of the matter in that tribe's tribal courts because self-governance is implicated. See Holyfield, 34. (Abusive state practices with respect to Indian Children "seriously undercut the tribes' ability to continue as self-governing communities. Probably in no area is it more important that tribal sovereignty be respected than in an area as socially and culturally determinative as family relationships." (citations omitted) (quotations omitted). Section 1911's "jurisdiction" does not concern a district court's subject matter jurisdiction; it concerns the connection to the forum and to the group of people (tribe). B. CARTER COUNTY DISTRICT COURT HAS CONCURRENT JURISDICTION PER 1911(b) ¶18 Because § 1911's jurisdiction does not concern subject matter jurisdiction, the preservation of it as error is subject to waiver on appeal,17 however; because of its importance, we address the question of whether the Carter County District Court erred in adjudicating S.J.W. deprived. Whether "such tribe" in § 1911(a)18 refers to the Indian Child's tribe or any tribe has not been the subject of much judicial scrutiny. ¶19 S.J.W., Parents and Amicus misunderstand the construction of § 1911(a). All would apply § 1911(a) and conclude the Chickasaw Nation has exclusive jurisdiction over S.J.W., a Creek Indian, absent consideration of the Intergovernmental Agreements providing for concurrent jurisdiction. But, neither § 1911(a) nor the § 1919 Intergovernmental Agreements are relevant in this case because: 1) S.J.W. is not domiciled within the Indian child's tribe's reservation (the Creek reservation) and is not a ward of the tribe, and 2) the Agreements only contemplate concurrent jurisdiction in the event 1911(a) applies, which it does not.19 Put simply, section 1911(a) does not apply and the Agreements are not at issue. ¶20 Section 1911 expresses a clear preference that Indian tribes adjudicate their own member Indian children. See 1911(a)-(b). Subsection (a) contemplates that an Indian tribe will have exclusive jurisdiction over an Indian child custody proceeding if the child is domiciled or residing within the reservation. Read together, subsection (b) provides for the concurrent, but presumably tribal, jurisdiction of an Indian child that does not reside on the Indian child's tribe's reservation. By the plain language of subsections (a) and (b), they are written to be mutually exclusive with an Indian child's status as a ward of a tribe as an exception. An Indian child either is or is not domiciled within the boundaries of the Indian child's tribe's reservation. We interpret subsection (a) to mean "[a]n Indian [child's] tribe shall have jurisdiction exclusive as to any State over any child custody proceeding involving an Indian child who resides or is domiciled within the reservation of such tribe, except where such jurisdiction is otherwise vested in the State by existing Federal law." § 1911(a) (emphasis added). ¶21 Such interpretation is reasonable given the stated purpose and findings from Congress. See 25 U.S.C. §§ 1901, 1902. ICWA's purpose is to protect the tribes themselves and the interests of Indian children. Id. Tribes have an interest in political and cultural survival, 44 Fed. Reg. 67,584 (1979), and Indian children have an interest in political membership in the tribe. Holyfield, at 34 citing supporting Congressional testimony and findings; see also Santa Clara Pueblo, 436 U.S. 49, 98 S. Ct. 1670, 56 L. Ed. 2d 106 (1978). The jurisdictional scheme grants to tribes exclusive jurisdiction for those member Indian children that live within the external boundaries of the tribe's reservation, or if they are otherwise a ward of the tribe. § 1911(a). On the other hand, if a member Indian child does not live on the Indian child's tribe's reservation, subsection (b) still purports to accomplish that preference. § 1911(b). In those cases, when an Indian child lives off the reservation, jurisdiction of the case is concurrent with the state and Indian Child's tribe, and the case may be transferred to that jurisdiction. Id. ¶22 Section 1911(a) grants exclusive jurisdiction to tribes wherein member Indian children reside or are domiciled within the external boundaries of their tribe's reservation. 25 U.S.C. § 1911(a); Holyfield at 42 (citing pre-ICWA caselaw confirming a tribe's interest in adjudicating member children: Fisher v. Dist. Court, 424 U.S. 382, 96 S. Ct. 943, 47 L. Ed. 2d 106 (1976); Wisconsin Potowatamies of Hannahville Indian Community v. Houston, 393 F. Supp. 719 (WD Mich. 1973); Wakefield v. Little Light, 276 Md. 333, 347 A.2d 228 (1975); In re Adoption of Buehl, 87 Wash. 2d 649, 555 P.2d 1334 (1976); In re Lehah-puc-ka-chee, 98 F. 429 (ND Iowa 1899)). ¶23 S.J.W. is a Creek Indian living in Carter County, Oklahoma. S.J.W. is not domiciled or residing within the Creek reservation; therefore, the State of Oklahoma shares concurrent jurisdiction with the tribe. § 1911(b). All challenges to the district court's exercise of jurisdiction are denied. 2. DELAY IN ADJUDICATION HEARING ¶24 Parents next argue that the trial court erred in denying Parents' motion to dismiss for failure to complete the adjudication hearing within the statutory time period. See 10A O.S. 2011, § 1-4-601(B)(2). Parents claim their due process rights were violated and ask this Court to reverse and remand the case with instructions to dismiss. We find no due process violation. ¶25 Parents' alleged deprivation of due process of law is not subject to waiver; it may be raised for the first time on appeal. See Patterson v. Beall, 2000 OK 92, ¶ 1, 19 P.3d 839, 841. It is true that due process is implicated in proceedings involving parental rights. See In re A.M., 2000 OK 82, ¶ 6, 13 P.3d 484. The Oklahoma Constitution, article 2, section 7 provides "[n]o person shall be deprived of life, liberty, or property, without due process of law." Before a deprivation can occur, due process requires a meaningful opportunity to be heard. Flandermeyer v. Bonner, 2006 OK 87, ¶ 10, 152 P.3d 195, 198-99. Due process is flexible and calls for such procedural protections as the particular situation demands. Id. citing Wood v. Indep. Sch. Dist. No. 141 of Pott. Co., 1983 OK 30 ¶ 17, 661 P.2d 892. The action must be arbitrary, oppressive or shocking to the conscience of the court to violate Parents' due process rights. Flandemeyer, 2006 OK 87, ¶ 10, 152 P.3d, at 199 citing Meadows v. Meadows, 1980 OK 158, ¶ 7, 619 P.2d 598. The passage of time alone does not establish an unconstitutional delay or a violation of due process. Simpson v. State, 1982 OK CR 35, ¶ 6, 642 P.2d 272. In determining whether an individual has been denied procedural due process we engage in a two-step inquiry, asking whether the individual possessed a protected interest to which due process protection applies and if so, whether the individual was afforded an appropriate level of process. In re A.M., 2000 OK 82, ¶ 7, 13 P.3d 484, 487 (citing Daniels v. Williams, 474 U.S. 327, 332, 106 S. Ct. 662, 88 L. Ed. 2d 662 (1986); U.S. Const. amend. XIV, § 1; Okla. Const., art. 2 § 7). ¶26 The answer to the first inquiry is clear. Parents have a constitutionally protected liberty interest in the continuity of the legal bond with their children. In re A.M., 2000 OK 82, at ¶ 8, 13 P.3d at 487 (citing In re Delaney, 1980 OK 140, 617 P.2d 886; In re Christina T., 1979 OK 9, 590 P.2d 189). The fundamental nature of parental rights requires that the full panoply of procedural safeguards must be applied to child deprivation hearings. In re A.M., 2000 OK 82, ¶ 8, 13 P.3d at 487 (citing In re Chad S., 1978 OK 94, 580 P.2d 983, 985). The answer to the second inquiry, however, must be determined on a case-by-case basis because the due process clause does not by itself mandate any particular form of procedure. It calls for such procedural protection as the particular situation demands. Id. at ¶ 9. ¶27 Section 1-4-601 concerns the effects of a district court's delay; if an adjudication hearing does not occur within the specified time period, certain consequences follow. It provides: A. The court shall hold an adjudication hearing following the filing of a petition alleging that a child is deprived. The hearing shall be held not more than ninety (90) calendar days following the filing of the petition. The child and the child's parents, guardian, or other legal custodian shall be entitled to not less than twenty (20) days' prior notice of the hearing.B. 1. The child shall be released from emergency custody in the event the adjudication hearing is delayed beyond ninety (90) days from the date the petition is filed unless the court issues a written order with findings of fact supporting a determination that:a. there exists reasonable suspicion that the health, safety, or welfare of the child would be in imminent danger if the child were returned to the home, andb. there exists either an exceptional circumstance to support the continuance of the child in emergency custody or the parties and the guardian ad litem, if any, agree to such continuance.2. If the adjudicatory hearing is delayed pursuant to this subsection, the emergency custody order shall expire unless the hearing on the merits of the petition is held within one hundred eighty (180) days after the actual removal of the child. (emphasis added). ¶28 Parents take issue with the district court's shortcomings under 1-4-601(B)(2). S.J.W. was born March 16, 2020. Shortly thereafter he was taken into State custody. The adjudication hearing was set, but continued at the Parent's request. The hearing occurred over the course of several months and concluded with the order adjudicating S.J.W. deprived on February 12, 2021. ¶29 After S.J.W. was taken into custody, this Court entered emergency orders due to the COVID-19 pandemic, which tolled deadlines for a period of time. The Third Emergency Order, SCAD 2020-36 provided: In all cases, the period from March 16, 2020 to May 15 2020, during which all rules and procedures, and deadlines, whether prescribed by statute, rule or order in any civil juvenile or criminal case were suspended, will be treated as a tolling period. May 16th shall be the first day counted in determining the remaining time to act. The entire time permitted by statute, rule or procedure is not renewed. S.J.W.'s case falls squarely in the types of cases SCAD 2020-36 addresses. S.J.W. was born on March 16, 2020 and taken into custody on March 18, 2020. SCAD Order No. 2020-36 tolled the start of the § 1-4-601 deadlines in this case until May 16, 2020. ¶30 After seeking and receiving a continuance, Parents filed the motion to dismiss claiming the court failed to hold the adjudication hearing within 180 days of the removal of the child. See 1-4-601(B)(2). But, with SCAD 2020-36, 180 days had yet to expire as of that date; the motion was premature. After the motion, the adjudication hearing continued over several days in October 1, 2020, October 23, 2020, November 20, 2020, and finally on February 12, 2021. It was in the middle of that time period, on November 12, 2020, that the 180 day marker from May 16, 2020 came and went without much ado. Parents did not timely renew their objection to the continuation of the hearing over 180 days, instead they continued to participate in the adjudication hearing. It was not until the final day of testimony that Parents renewed their motion to dismiss. On that date, for good cause shown, the district court overruled the motion. ¶31 In this case Parents were afforded an appropriate level of process. The complained-of conduct was the trial court's delay in concluding the adjudication hearing. While it is true the adjudication concluded months after the statutory limitation, even with the emergency order, Parents continued to participate in the proceedings without further objection until the last possible moment. There has been no showing that such delay was arbitrary, oppressive or shocking to the conscience of the court. Accordingly, we hold there has been no due process of law violation for a delay in concluding the adjudication hearing. CONCLUSION ¶32 State district courts are presumed to have subject matter jurisdiction. Okla. Const. art. VII, § 7(a). ICWA's jurisdictional statute ousts the State's territorial jurisdiction in limited circumstances. § 1911(a). In this case, the child custody proceeding involving a Creek Indian child domiciled in Chickasaw Nation reservation is subject to the concurrent jurisdiction of the State and Creek Nation. § 1911(b). The Carter County District Court had subject matter jurisdiction. ¶33 Under the circumstances of this case the delayed adjudication did not deprive Parents of their due process of law as Parents had a meaningful opportunity to defend, and the delay was not arbitrary, oppressive or shocking to the conscience of the court. ¶34 Motion to Dismiss is DENIED; Order of the District Court is AFFIRMED. Kane, C.J., Winchester, Edmondson, Gurich, Darby and Kuehn (by separate writing), JJ., concur; Rowe, V.C.J., Kauger, and Combs, JJ., concur in result. FOOTNOTES 1 We take judicial notice of the fact that Carter County is entirely within the external boundaries of the Chickasaw reservation, which is therefore "Indian country." See 12 O.S.Supp.2002, §§ 2202-03 for this Court's ability to take judicial notice of adjudicative facts and the propriety of doing so; see also Bosse v. Oklahoma, 2021 OK CR 30, 499 P.3d 771 wherein the Oklahoma Court of Criminal Appeals held the Chickasaw Nation reservation was never disestablished and remains "Indian country". Important to note is that this case is a direct appeal, and not a collateral attack on a final judgment. Compare In re B.H. & J.H., 2022 OK 80, 519 P.3d 91, and the cases cited therein noting that for cases reviewed on collateral attack, review is strictly limited to the judgment roll. 2 However, an exception exist regardless of domicile or residence of the Indian child when child is a ward of the tribal court. See 25 U.S.C. § 1911(a). 3 First Emergency Joint Order Regarding the Covid-19 State of Disaster, SCAD 2020-24 (Okla. 2020), 2020 OK 25. A Second Emergency Joint Order Regarding the Covid-19 State of Disaster was entered on March 27, 2020. SCAD 2020-29 (Okla. 2020), 2020 OK 24. 4 The record contains no mention of an emergency custody hearing and no emergency custody order. Parents in a later trial court pleading admit the existence of an emergency custody order even though none appears in the record. See R. at 18-19. 5 Now Morgan Wilburn. 6 1. The trial court erred in adjudicating the minor child as deprived. 2. The State did not meet its burden of proof to adjudicate the minor child as deprived. 3. The trial court erred in denying Appellants' Motion to Dismiss the case for failure to adjudicate the minor child within 180 days as required by statute. 7 McGirt held the Muscogee (Creek) Nation reservation was never disestablished. McGirt at 2468. As a result, the area remains Indian Country. Id., 2459-60, 2468. 8 Bosse held the Chickasaw Nation reservation was never disestablished. Bosse, ¶ 8. 9 The Holyfield Court said: At the heart of the ICWA are its provisions concerning jurisdiction over Indian child custody proceedings. Section 1911 lays out a dual jurisdictional scheme. Section 1911(a) establishes exclusive jurisdiction in the tribal courts for proceedings concerning an Indian child 'who resides or is domiciled within the reservation of such tribe,' as well as for wards of tribal courts regardless of domicile. Section 1911(b), on the other hand, creates concurrent but presumptively tribal jurisdiction in the case of children not domiciled on the reservation; on petition of either parent or the tribe, state-court proceedings for foster care placement or termination of parental rights are to be transferred to the tribal court, except in cases of 'good cause,' objection by either parent, or declination of jurisdiction by the tribal court. Holyfield, at 36 (footnotes omitted). 10 As of June 29, 2022, the U.S. Supreme Court has recognized the following reservations within the external boundaries of Oklahoma: Creek, Cherokee, Choctaw, Chickasaw and Seminole reservations. Oklahoma v. Castro-Huerta, 597 U.S. ___, 142 S. Ct. 2486, 2490, 213 L. Ed. 2d 847 (2022). 11 See Lewis v. Sac & Fox Tribe of Okla. Hous. Auth., 1994 OK 20, ¶¶ 15-16, 896 P.2d 503, 510-11: Under our system of federalism, a state's sovereignty is concurrent with that of the federal government, subject only to limitations imposed by the Supremacy Clause. Yellow Freight System, Inc. v. Donnelly teaches that state courts have inherent authority, and are thus presumptively competent, to adjudicate claims arising under the laws of the United States. To give federal courts exclusive jurisdiction over a federal cause of action, Congress must, in an exercise of its powers under the Supremacy Clause, affirmatively divest state courts of their presumptively concurrent jurisdiction. In Gulf Offshore v. Mobil Oil the Court identified three different methods by which a congressional state-court ouster may be effected --- (1) by an explicit statutory directive, (2) by unmistakable implication from legislative history, or (3) by a clear incompatibility between state-court jurisdiction and federal interests. The constitutional ouster-of-jurisdiction doctrine is not to be confused with federal preemption. Preemption occurs when federal law displaces a body of state law on the same subject. Unlike state-court ouster, which requires that we examine the law for the presence of an explicit statutory directive conferring exclusive federal-court jurisdiction, preemption is a matter of congressional intent, which may be effected even by regulations of a federal agency acting within the scope of congressionally delegated authority. Preemption alone cannot divest state courts of jurisdiction to entertain federal-law claims. (Internal quotations and footnotes omitted). 12 Okla. Const. art. VII, § 7(a). 13 See 25 U.S.C. § 1922 (providing for limited state jurisdiction in the case of an Indian child residing or domiciled on a reservation, but temporarily located off the reservation, to prevent imminent physical damage or harm to the child). 14 ICWA explicitly authorizes an Indian tribe and state to agree to concurrent jurisdiction outside the default rules set out by ICWA. 25 U.S.C. § 1919. States and Indian tribes are authorized to enter into agreements with each other respecting care and custody of Indian children and jurisdiction over child custody proceedings, including agreements which may provide for orderly transfer of jurisdiction on a case-by-case basis and agreements which provide for concurrent jurisdiction between States and Indian tribes. 25 U.S.C. § 1919(a). 15 25 U.S.C. § 1903(1) provides: "child custody proceeding" shall mean and include- - (i) 'foster care placement' which shall mean any action removing an Indian child from its parent or Indian custodian for temporary placement in a foster home or institution or the home of a guardian or conservator where the parent or Indian custodian cannot have the child returned upon demand, but where parental rights have not been terminated;(ii) 'termination of parental rights' which shall mean any action resulting in the termination of the parent-child relationship;(iii) 'preadoptive placement' which shall mean the temporary placement of an Indian child in a foster home or institution after the termination of parental rights, but prior to or in lieu of adoptive placement; and(iv) 'adoptive placement' which shall mean the permanent placement of an Indian child for adoption, including any action resulting in a final decree of adoption. Such term or terms shall not include a placement based upon an act which, if committed by an adult, would be deemed a crime or upon an award, in a divorce proceeding, or custody to one of the parents. 16 Subsections 4 and 8 of §1903 provide: "Indian child" means any unmarried person who is under age eighteen and is either (a) a member of an Indian tribe or (b) is eligible for membership in an Indian tribe and is the biological child of a member of an Indian tribe. . ." "Indian tribe" means any Indian tribe, band, nation, or other organized group or community of Indians recognized as eligible for the services provided to Indians by the Secretary because of their status as Indians, including any Alaska Native village as defined in section 1602(c) of Title 43. . . 17 "[M]atters not first presented to the trial court for resolution are generally not considered on appeal." Osage Nation v. Bd. of Commissioners of Osage Cnty., 2017 OK 34, ¶ 17, 394 P.3d 1224, 1232 (footnote omitted). 18 An Indian tribe shall have jurisdiction exclusive as to any State over any child custody proceeding involving an Indian child who resides or is domiciled within the reservation of such tribe, except where such jurisdiction is otherwise vested in the State by existing Federal law. Where an Indian child is a ward of a tribal court, the Indian tribe shall retain exclusive jurisdiction, notwithstanding the residence or domicile of the child. §1911(a) (emphasis added). 19 The Intergovernmental Agreement Between the State of Oklahoma And Each Of The Five Tribes Regarding Jurisdiction Over Indian Children Within Each Tribe's Reservation is available at the Oklahoma Secretary of State's Website. There are several provisions which reiterate the goal of the parties, which is to share concurrent jurisdiction if the jurisdiction would otherwise have been exclusive per 25 U.S.C. § 1911(a), to wit: This Agreement is the result of a partnership formed by each of the Five Tribes and the State of Oklahoma. The intent of this Agreement is to further streamline the jurisdictional provisions put forth in the Indian Child Welfare Act and create concurrent jurisdiction on the respective reservations of the Five Tribes with the State of Oklahoma and its political subdivisions. *** IV. CONCURRENT JURISDICTIONThe parties have agreed to enter into this jurisdiction sharing Agreement based on the premise that the Five Tribes have exclusive jurisdiction over any child custody proceeding involving an Indian child domiciled within the boundaries of each tribe's respective reservation as provided for in 25 U.S.C. § 1911(a).Within the respective reservation boundaries of the Five Tribes, as those boundaries are described in the most recent treaty or agreement between each Tribe and the United States, the State of Oklahoma and each Tribe shall share concurrent jurisdiction over any Indian child domiciled within its reservation, except as follows: (1) Each Tribe shall retain exclusive jurisdiction over any child custody proceeding involving an Indian child domiciled or located on lands: (A) all Indian allotments, the Indian titles to which have not been extinguished, including rights-of-way running through the same; or(B) land held in trust by the United States on behalf of an individual Indian or Tribe; or(C) land owned in fee by a Tribe, if the Tribe-- (i) acquired fee title to such land, or an area that included such land, in accordance with a treaty with the United States to which such Tribe was a party; and (ii) never allotted the land to a citizen or member of such Tribe. (2) Where an Indian child is a ward of a Tribe's court, the Tribe shall retain exclusive jurisdiction, notwithstanding the residence or domicile of the child. Intergovernmental Agreement Between the State of Oklahoma And Each Of The Five Tribes Regarding Jurisdiction Over Indian Children Within Each Tribe's Reservation, Aug. 7, 2020, Okla. Sec'y of State Doc. No. 50531, https://www.sos.ok.gov/documents/filelog/93637.pdf. KUEHN, J., with whom KAUGER and COMBS, JJ., join, SPECIALLY CONCURRING: ¶1 I concur in the Majority's conclusion that the State has concurrent jurisdiction under the federal and Oklahoma Indian Child Welfare Acts, as this is consistent with our recent conclusion in Milne v. Hudson, 2022 OK 84, 519 P.3d 511.

e0570ffd-6668-4abe-b9ea-534c0a9e1c68

Terral Telephone Co. v. Oklahoma St. Bd. of Equalization

oklahoma

Oklahoma Supreme Court

TERRAL TELEPHONE CO. v. OKLAHOMA STATE BD. OF EQUALIZATION2023 OK 51Case Number: 120943Decided: 05/02/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TERRAL TELEPHONE COMPANY, Appellant/Complainant, v. OKLAHOMA STATE BOARD OF EQUALIZATION, Appellee/Respondent. APPEAL FROM COURT OF TAX REVIEW; TOM L. NEWBY, CHIEF JUDGE, DONNA L. DIRICKSON, CHRISTINE LARSON, JUDGES ¶0 The Respondent, Oklahoma State Board of Equalization, assessed the ad valorem tax concerning the property of the Complainant, Terral Telephone Company. The Complainant protested the assessment. The Respondent moved for dismissal alleging the protest was non-compliant and untimely. The Court of Tax Review agreed and ruled that the protest did not comply with the statutes and rules necessary to invoke its jurisdiction. The Complainant appealed the ruling to this Court and we retained the matter. We affirm the ruling of the Court of Tax Review. MOTION TO RETAIN PREVIOUSLY GRANTED; COURT OF TAX REVIEW AFFIRMED William K. Elias, Wyatt D. Swinford, Jay W. Dobson, and Brittany N. Dowd, ELIAS, BOOKS, BROWN & NELSON, P.C., Oklahoma City, Oklahoma, for Appellant/Complainant Christy D. Keen, Assistant General Counsel, OKLAHOMA TAX COMMISSION, Oklahoma City, Oklahoma, for Respondent/Appellee COMBS, J.: FACTUAL AND PROCEDURAL BACKGROUND ¶1 On June 17, 2022, the Appellee/Respondent, Oklahoma State Board of Equalization (OSBE), mailed the Appellant/Complainant, Terral Telephone Company (TTC), a notice of ad valorem tax assessment which was dated June 16, 2022. This notice is a statutory requirement pursuant to 68 O.S. 2021, § 2881(A) and is required to be mailed within one (1) working day from the date it is prepared.1 Section 2881(A) also requires that the notice clearly mark the date that it was prepared. It provides that a taxpayer "shall have twenty (20) calendar days from the date of the notice in which to file" a written complaint, i.e., the complaint must be filed within twenty days from the date of the notice's preparation date as indicated on the notice.2 The notice also informed the taxpayer that it was made in accordance with § 2881, Rules of the Court of Tax Review (RCTR), "68 O.S. Ch. 1, Art. 28, App." and that "Rule 11 of the rules of the Court of Tax Review provides the format for the complaint." The notice's preparation date was listed on the notice as June 16, 2022. Therefore, the last day to file a written complaint was July 6, 2022, which is twenty (20) days from that date. ¶2 Rule 2 (RCTR) provides that the time for filing a complaint pursuant to § 2881 is jurisdictional and may not be waived or otherwise extended.3 Rule 3 (A)(RCTR) provides strict compliance requirements for the contents of the complaint.4 It requires the complaint to comply with Rule 11 (RCTR), Form No. 15, it must state the year of the ad valorem assessment to be reviewed, it must attach a properly completed form prescribed by the Oklahoma Tax Commission (OTC), it must specify the counties where the property is located, it must be filed within thirty (30) days of the notice of assessment [rather than twenty (20) days]6, it must have an attached copy of the notice, and it shall specify the amount of the assessed valuation protested. ¶3 Terral Telephone Company is a corporation. On July 7, 2022, the president, Chad Segress, of TTC mailed by certified mail a Form OTC 9897 (Notice of Protest to the State Board of Equalization and the Oklahoma Tax Commission of Filing in Court of Tax Review) to the Court of Tax Review to protest the valuation assessment. Mr. Segress is not an attorney. The Court Clerk of the Court of Tax Review stamped the Form OTC 989 as filed on July 11, 2022. No complaint, as required by both statute and rules, or any other required documents were filed. Two days later, July 13, 2022, this Court issued an order informing Mr. Segress that he failed to file a complaint as required by Rules 3 and 11 (RCTR), and failed to state the counties in which the property at issue is located, as required by Rule 3 (RCTR). The order directed him to file a complaint in compliance with Rule 11(RCTR), Form No. 1 by July 22, 2022. On July 22, 2022, TTC, through its attorney, filed a First Amended Complaint to Review 2022 Ad Valorem Tax Assessment with the Court Clerk of the Court of Tax Review. This so-called amended complaint appears to comply with the content requirements of § 2881 and Rules 3 and 11(RCTR). ¶4 On August 9, 2022, the OSBE moved to dismiss these proceedings due to TTC's failure to invoke the jurisdiction of the Court of Tax Review. The grounds alleged for dismissal were that TTC's July 11, 2022 filing of Form OTC 989 was not a complaint but was instead only a form that needed to be attached to a complaint, was untimely because it was not filed within twenty (20) days from the date of preparation indicated on the notice of assessment and did not meet the other strict compliance content requirements of Rule 3(A)(4)(RCTR) or the requirements of § 2881 and Rule 11(RCTR). Therefore, pursuant to Rule 2(RCTR), a complaint had not been timely filed and the Court of Tax Review lacked jurisdiction. After reviewing the motion, TTC's response and OSBE's reply, the Court of Tax Review granted the motion to dismiss. The Court's November 23, 2022 Order dismissed the protest with prejudice for lack of jurisdiction. The Court held that § 2881 requires the complainant to file a written complaint with the Court Clerk of the Court of Tax Review within twenty (20) days from the date of the notice of assessment. Rule 2 (RCTR) makes the timely filing of the complaint a jurisdictional requirement. Mr. Segress is not an attorney and he filed only a Form OTC 989 on July 11, 2022. The Form OTC 989 is required to be attached to the complaint. Further, the complaint is to be in the required form as provided in Rule 11(RCTR), Form No. 1 and must strictly comply with the provisions of Rule 3(A)(4)(RCTR). The Court held the July 11, 2022 Form OTC 989 is null and void because: 1) it was not signed by an attorney; 2) it was filed more than twenty (20) days after the notice of assessment; and, 3) it did not comply with Rule 11(RCTR), Form No. 1. It concluded that it lacked jurisdiction to hear the matter because of TTC's failure to file a complaint in proper form and in a timely manner (Rule 3(A)(4)(RCTR) and § 2881). The Order also held that the July 13, 2022, Order of this Court, directing TTC to file a complaint in the proper form, did not determine the jurisdiction of the Court of Tax Review. ¶5 On December 21, 2022, TTC filed a petition in error in this Court. It also moved for this Court to treat the matter as an accelerated appeal and retain the matter for this Court's review. Both were granted. STANDARD OF REVIEW ¶6 The subject of this appeal is OSBE's motion for entry of order of dismissal which was granted by the Court of Tax Review. The purpose of a motion to dismiss is to test the law that governs the claim in litigation rather than to examine the underlying facts of that claim. Samson Resources Co. v. Newfield Exploration Mid-Continent, 2012 OK 68, ¶10, 281 P.3d 1278, 1281 (citation omitted). Whether a claim should have been dismissed for lack of subject matter jurisdiction is a question of law this Court reviews de novo. Id. ANALYSIS ¶7 The issues before us are one of law, i.e., whether the Court of Tax Review has subject matter jurisdiction to hear TTC's protest of the ad valorem tax assessment. TTC claims it complied with relevant rules and statutes pertaining to the protest. However, the facts underlying its alleged compliance are not at issue. When TTC mailed/filed its first attempt at a protest and its later amended complaint are not disputed. The question is whether the actions of TTC in attempting to file a protest satisfied the legal requirements to invoke the jurisdiction of the Court of Tax Review. We hold, it did not. ¶8 TTC asserts that the Court of Tax Review failed to interpret numerous ambiguities in the law in its favor. They had previously cited McGannon v. State, 1912 OK 384, 124 P. 1063, 1067 to support their assertion that any ambiguity in tax law provisions must be construed most strongly against the state and in favor of the taxpayer.8 We recently presented clarity to this construction of tax statutes. In Assessments for Tax Year 2012 of Certain Properties Owned by Throneberry v. Wright, 2021 OK 7, ¶¶ 18-20, 481 P.3d 883, 893, we held such construction was not applicable to an asserted ambiguity in 68 O.S. § 2884. We explained "'[t]he rule means that the provisions of statutes levying taxes will not be extended by implication beyond the clear import of the language used.'" Id. ¶19, 481 P.3d at 893 (footnote omitted). We noted the § 2884 controversy concerned an interpretation of the term "interest" in the statute and did not involve the imposition of a tax by implication. Id. Secondly, doubts must arise from ambiguous, conflicting, or uncertain statutory language in the tax law itself. Id. ¶20. The tax statute at issue contained no ambiguity, uncertainty, or internal conflict. Id. ¶9 TTC claims it substantially complied with the filing requirements when it mailed Form OTC 989 to the Court Clerk of the Court of Tax Review on July 7, 2022. TTC argues the document was on a form prescribed by the OTC and it substantially complied with § 2881 as required by Rule 3(B)(RCTR). TTC suggests two ways the filing of the form was timely: 1) it filed Form OTC 989 within thirty (30) days of the notice of assessment as required, at that time, by Rule 3(A)(RCTR), or 2) the Form OTC 989 was timely filed within twenty (20) days of the mailing of the notice of assessment pursuant to § 2881(B). These assertions reflect TTC's alleged ambiguities in the provisions of § 2881 and Rule 3(RCTR). All of the alleged ambiguities relate to the required procedure necessary to invoke the jurisdiction of the Court of Tax Review; none involve an ambiguity related to substantive provisions imposing an ad valorem tax assessment, which is the subject of this protest, or to any provision that ambiguously imposes a tax by implication. ¶10 First, we will address the required contents that must be filed in order to invoke the jurisdiction of the Court of Tax Review. Section 2881 and Rule 3(RCTR) require the filing of a written complaint and Rule 2(RCTR) makes the filing of a complaint jurisdictional. The Form OTC 989 is only a notice of protest and it specifically refers to 68 O.S. § 2881. TTC mailed the notice of protest on July 7, 2022 but did not include a complaint. Rule 11(RCTR), Form No. 1 provides the form and content of the complaint. Rule 3(A)(4) (RCTR), (amnd. by Order of the Oklahoma Supreme Court in In re: Amendments to Rules for the Oklahoma Court of Tax Review, 1997 OK 85) further provides the required content of the complaint: A. Strict Compliance. Complaints and notices of intent to appeal shall be in strict compliance with the following: . . . . 4. Proceeding pursuant to § 2881: A complaint filed with the Court of Tax Review pursuant to 68 O.S.Supp.1995 § 2881 (as amended by H.B. 1338, eff. July 1, 1997), must comply with Rule 11 Form No. 1. The Complaint must state the year of the ad valorem assessment to be reviewed. The Complaint must have attached as Exhibit A the properly completed form prescribed by the Oklahoma Tax Commission. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint must specify the counties where the property is located. The Complaint must be filed within thirty (30) days of the notice of assessment, and the Complaint must have attached as Exhibit B a copy of the notice. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint shall specify the amount of the assessed valuation protested. Id. Rule 2(RCTR) is clear that the timeliness for filing a "complaint" cannot be waived or otherwise extended. TTC argues that Rule 3(B)(RCTR) only requires it to substantially comply with title 68 and its filing of Form OTC 989 amounts to substantial compliance. Subsection B of Rule 3 provides: B. Substantial Compliance. Complaints, protests, and notices of intent to appeal shall be in substantial compliance with the applicable provisions of Title 68 authorizing the filing thereof. Both § 2881 and Subsection A of Rule 3(RCTR) require a complaint be filed. Although subsection B requires substantial compliance with the applicable provisions of title 68, subsection A requires "strict compliance" for the content of the complaint. The Form OTC 989, for instance, does not provide the required information concerning the counties and congressional districts where the property is located. This information is required on Rule 11(RCTR), Form No. 1 and Rule 3(A)(4)(RCTR) states that the complaint "must comply with Rule 11 Form No. 1." There is no way the filing of Form OTC 989 alone amounted to substantial compliance with these requirements in order to invoke the jurisdiction of the Court of Tax Review. "It is axiomatic, that in most instances, ignorance of the law is no excuse, and every person is presumed to know the law." Estes v. ConocoPhillips Co., 2008 OK 21, ¶22, 184 P.3d 518, 526. ¶11 The June 16, 2022 notice of assessment letter which was mailed to TTC on June 17, 2022, specifically referenced 68 O.S. § 2881, the Rules of the Court of Tax Review, "68 O.S. Ch. 1, Art. 28, App.," and states the format of the complaint is found in Rule 11(RCTR). In addition, Form OTC 989 states that to be timely filed, the Court of Tax Review must be in receipt of the notice of protest on or before twenty (20) days from the "date listed" on the notice. Subsection A of Section 2881 provides: The notice, which shall clearly be marked with the date upon which it was prepared, shall be mailed within one (1) working day of such date. The taxpayer shall have twenty (20) calendar days from the date of the notice in which to file, with the Clerk of the Court of Tax Review, a written complaint on a form prescribed by the Tax Commission . . . . Although the OTC provides the Form OTC 989 and does not provide the written complaint form, the notice of assessment letter clearly indicates that the format of the complaint is in Rule 11(RCTR) and gives a citation where to find the rules. TTC asserts that the language "the taxpayer shall have twenty (20) days from the date of the notice" in the second sentence quoted above is ambiguous because it could be interpreted to mean a taxpayer has twenty (20) days from the date of mailing of the notice of assessment to file its protest. It further believes this is apparent when reading subsection B of § 2881 which provides: B. If the taxpayer fails to file a written complaint within the twenty-day period provided for in this section, then the assessed valuation stated in the notice, without further action of the State Board of Equalization, shall become final and absolute at the expiration of twenty (20) days from the date the notice is mailed to the taxpayer. However, there is no ambiguity here. Subsection B states if the tax payer fails to file a written complaint as provided in this section (not subsection), then the assessed valuation shall become final at the expiration of twenty (20) days from the date the notice of assessment was mailed to the taxpayer. The "date the notice is mailed" language in subsection B only refers to when the assessed valuation becomes final. The first part of the sentence is referring to the time period to file a written complaint which is found in subsection A. When reading the two quoted sentences together in subsection A it is clear that the written complaint must be filed within twenty (20) days of the date the notice was prepared which is to be "clearly . . . marked" on the notice of assessment. The first quoted sentence in subsection A also requires the notice of assessment to be mailed within one (1) day of the date it was prepared. Therefore, TTC's assertion that the time period ran from either the date the notice of assessment was mailed (June 17, 2022) or the date of his receipt of the notice (June 22, 2022) are without merit. TTC filed a Form OTC 989 on July 7, 2022, which alone, as mentioned, did not comply with the necessary requirements of a complaint. July 6, 2022, was the last day that TTC could file its complaint. TTC was one day late in filing but what it filed was not the required complaint necessary to invoke the jurisdiction of the Court of Tax Review.9 ¶12 TTC next argues that the applicable version of Rule 3(RCTR) provided that a taxpayer had thirty (30) days to file a complaint and § 2881 provides a twenty (20) day period to file a complaint which causes an ambiguity that should be resolved in a taxpayer's favor. As in Assessments for Tax Year 2012 of Certain Properties Owned by Throneberry v. Wright, 2021 OK 7, 481 P.3d 883, the asserted ambiguity here does not concern an ambiguity which might impose a tax by implication. The alleged ambiguity concerns a procedural provision necessary to invoke the jurisdiction of the Court of Tax Review. The provisions, however, are irreconcilably in conflict with one another. When a rule irreconcilably conflicts with a statute the provisions of the statute shall prevail. Ark. La. Gas Co. v. Travis, 1984 OK 33, ¶7, 682 P.2d 225, 227; Cole v. State ex. rel. Dept. of Public Safety, 2020 OK 67, ¶5, 473 P.3d 467, 475 (Gurich, C.J. dissenting)("When a rule or regulation conflicts with a statutory enactment, the statute prevails."). Therefore, the statutory twenty (20) day period from the date of the preparation of the notice of assessment, which is required to be clearly listed on the notice of assessment, is the date from which the period to file a complaint commences and TTC failed to comply with this jurisdictional requirement. In other words, the complainant has twenty (20) days from the date listed on the notice of assessment to file its complaint. TTC's argument that it complied with the July 13, 2022 Order of this Court and filed a proper amended complaint on July 22, 2022, does not extend the jurisdiction of the Court of Tax Review.10 Again, TTC argues that the first amended complaint was filed within thirty (30) days of the date it received (June 22, 2022) the notice of assessment. Neither the thirty (30) day period in the relevant version of Rule 3(RCTR) nor the date of receipt of a notice of assessment is applicable in determining the jurisdiction of the Court of Tax Review. Even if the thirty (30) day period was found to be applicable, TTC's first amended complaint would have to have been filed within thirty (30) days from the date listed on the notice of assessment in order to invoke the jurisdiction of the Court of Tax Review and July 22, 2022 would have been more than thirty days from that date. The July 13, 2022 Order pointed out the deficiencies in TTC's first filing. It did not attempt to rule on whether the Court of Tax Review had jurisdiction of the matter nor could it extend the filing period under the provisions of Rule 2(RCTR).11 CONCLUSION ¶13 Taxpayer, TTC, attempted to protest an ad valorem tax assessment made by the OSBE. It made two attempts to comply with the statute and rules to file a complaint. Both were untimely and failed to invoke the jurisdiction of the Court of Tax Review. MOTION TO RETAIN PREVIOUSLY GRANTED; COURT OF TAX REVIEW AFFIRMED Kane, C.J., Rowe, V.C.J., Winchester, Edmondson, Combs, and Darby, JJ. -- concur; Kauger, J. -- concur in part, dissent in part; Gurich (by separate writing) and Kuehn, JJ., - dissent. FOOTNOTES 1 68 O.S. 2021, § 2881: A. The secretary of the State Board of Equalization shall notify all railroads, air carriers and public service corporations of the ad valorem tax assessments rendered by the State Board, including the valuation, assessment ratio and total amount of assessment. The notice, which shall clearly be marked with the date upon which it was prepared, shall be mailed within one (1) working day of such date. The taxpayer shall have twenty (20) calendar days from the date of the notice in which to file, with the Clerk of the Court of Tax Review, a written complaint on a form prescribed by the Tax Commission, specifying grievances with the pertinent facts in relation thereto in ordinary and concise language, without repetition, and in such manner as to enable a person of common understanding to know what is intended. The complaint shall include the amount of Oklahoma assessed valuation protested and the grounds for the protest. The taxpayer shall be required to send a copy of the complaint to the Tax Commission. B. If the taxpayer fails to file a written complaint within the twenty-day period provided for in this section, then the assessed valuation stated in the notice, without further action of the State Board of Equalization, shall become final and absolute at the expiration of twenty (20) days from the date the notice is mailed to the taxpayer. C. After the filing of a complaint provided for in subsection A of this section, the State Board of Equalization shall have thirty (30) days within which to file an answer. The Court of Tax Review shall set a date of hearing, conduct such hearing, render its decision, and notify in writing the taxpayer and the State Board of Equalization of its decision within sixty (60) days of the date of the scheduling conference. The Court of Tax Review shall be authorized and empowered to take evidence pertinent to the complaint, and for that purpose may compel the attendance of witnesses and the production of books, records and papers by subpoena, and to confirm, correct or adjust the valuation, as required by law. D. The State Board of Equalization shall notify, in writing and by certified mail, the Attorney General and all affected school districts and other recipients of ad valorem tax revenue of the complaint provided for by this section within ten (10) days of the filing of the complaint. E. The Attorney General may appear in all actions to enforce the valuation and assessment of property by the State Board of Equalization and the collection of ad valorem tax which is the subject of the complaint filed pursuant to this section. F. Either the State Board of Equalization or the party filing a complaint pursuant to this section may appeal the decision of the Court of Tax Review by filing a notice of intent to appeal with the Clerk of the Court of Tax Review within thirty (30) calendar days of the date the final decision is sent to the parties. Appeal shall be brought in the Oklahoma Supreme Court in the same manner as provided for other appeals from the Court of Tax Review. The Supreme Court shall give precedence to such appeals and affirm the decision of the Court of Tax Review if supported by competent evidence. If the Oklahoma Supreme Court assigns the appeal to the Court of Civil Appeals, the Oklahoma Court of Civil Appeals shall give precedence to the appeal and affirm the decision of the Court of Tax Review if supported by competent evidence. G. In all instances where the notice of assessed valuation certified by the State Board of Equalization has been permitted to become final, such notice shall have the same force and be subject to the same law as a judgment not subject to further appeal. 2 68 O.S. 2021, § 2881, was last amended by 2001 Okla.Sess.Laws ch. 358, § 21, eff. July 1, 2001 (HB 1203). This amendment changed the period to file a written complaint from thirty (30) days to twenty (20) days. 3 Rule 2, (RCTR)(amnd. by Order of the Oklahoma Supreme Court in In re: Amendments to Rules for the Oklahoma Court of Tax Review, 1997 OK 85) which was relevant to this tax assessment at all pertinent times: The times within which to file a complaint of the State Board of Equalization or notice of intent to appeal a decision of the Oklahoma Tax Commission as provided by statute is jurisdictional and may not be waived or otherwise extended. The Jurisdiction of the Court of Tax Review shall be invoked by: 1. The timely filing with the State Auditor and Inspector of a complaint challenging the legality of the budget for the taxing entities within the county or the legality of the tax levy. 68 O.S.1991 § 3023. 2. The timely filing with the Clerk of the Appellate Courts of a complaint challenging a valuation or equalization order of the State Board of Equalization. 68 O.S.1991 § 2882 and 68 O.S.Supp.1995 § 2881 (as amended by H.B. 1338, eff. July 1, 1997). 3. The timely filing with the Clerk of the Appellate Courts of an intent to appeal a decision of non-compliance. 68 O.S.1991 § 2883. 4 Rule 3, (RCTR)(amnd. by Order of the Oklahoma Supreme Court in In re: Amendments to Rules for the Oklahoma Court of Tax Review, 1997 OK 85) which was relevant to this tax assessment at all pertinent times: A. Strict Compliance. Complaints and notices of intent to appeal shall be in strict compliance with the following: 1. An original and four copies of all pleadings, complaints, protests, notices of intent to appeal, responses and other filings shall be prepared on 8 1/2 " x 11" paper only. 2. In all proceedings the complaint, notice, or protest must state the county in which the property which is the subject of the proceeding is located. 3. In all proceedings where the Oklahoma Tax Commission is required by statute to prescribe the form for filing a complaint or notice with the Court of Tax Review a completed copy of the form shall be attached to the complaint or notice filed with the Court of Tax Review. 4. Proceeding pursuant to § 2881: A complaint filed with the Court of Tax Review pursuant to 68 O.S.Supp.1995 § 2881 (as amended by H.B. 1338, eff. July 1, 1997), must comply with Rule 11 Form No. 1. The Complaint must state the year of the ad valorem assessment to be reviewed. The Complaint must have attached as Exhibit A the properly completed form prescribed by the Oklahoma Tax Commission. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint must specify the counties where the property is located. The Complaint must be filed within thirty (30) days of the notice of assessment, and the Complaint must have attached as Exhibit B a copy of the notice. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint shall specify the amount of the assessed valuation protested. Id. B. Substantial Compliance. Complaints, protests, and notices of intent to appeal shall be in substantial compliance with the applicable provisions of Title 68 authorizing the filing thereof. 5 Rule 11(RCTR), Form No. 1: Form No. 1--Taxpayer complaint pursuant to 68 O.S.Supp.1995 § 2881, (as amended by H.B. 1338, eff. July 1, 1997). IN THE COURT OF TAX REVIEW OF THE STATE OF OKLAHOMA _______________________ ) _______________________ ) _______________________ ) Complainant, ) v. No. ____________ OKLAHOMA STATE BOARD OF EQUALIZATION ) Respondent. ) COMPLAINT FOR REVIEW OF AD VALOREM ASSESSMENT FOR ____________ (YEAR) The complainant taxpayer, _______________, for its Complaint for Review of its _____ ad valorem property assessment states as follows: 1. Attached hereto as Exhibit A is the properly completed form specified by the Oklahoma Tax Commission for filing a complaint pursuant to 68 O.S.Supp.1995 § 2881. 2. The property assessed in this case is located in the following congressional districts of the State of Oklahoma: _______________. 3. Attached as Exhibit B is a copy of the notice of ad valorem assessment mailed to the taxpayer. 4. The property assessed in this case is located in the following counties of the State of Oklahoma: ____________________. 5. The amount of the assessed valuation protested: _______________ Complainant shall specify grievances and pertinent facts in relation thereto in ordinary and concise language in such a manner to enable a person of common understanding to know what is intended. The Complainant shall specify the grounds for the protest. The Complainant shall make these allegations in subsequently numbered paragraphs herein using as many paragraphs and pages as are necessary to present the allegations in concise language. 6. SERVICE BY COUNSEL DATE: _______________________, 19___. Signature: ___________________________ (Signature of Attorney) Attorney for _________________________ (Complainant) OBA No.: _____________________________ Firm: ________________________________ Address: _____________________________ ______________________________________ ______________________________________ Telephone: ___________________________ CERTIFICATE OF SERVICE I, __________, hereby certify that in addition to filing the original Complaint for Review of Ad Valorem Assessment for _____ with the Clerk of the Court of Tax Review copies of the foregoing Complaint were mailed by first class mail, postage prepaid, this __ day of __________ 199___, to the Secretary of the State Board of Equalization, Oklahoma Attorney General, and General Counsel of the Oklahoma Tax Commission at the following addresses: __________________________________________________ (Name of Secretary of State Bd. of Equalization) Secretary, State Board of Equalization __________________________________________________ __________________________________________________ __________________________________________________ (Name of General Counsel, Oklahoma Tax Commission) General Counsel, Oklahoma Tax Commission __________________________________________________ __________________________________________________ __________________________________________________ (Name of Oklahoma Attorney General) Attorney General, State of Oklahoma __________________________________________________ __________________________________________________ 6 Rule 3 (RCTR) was amended by this Court on December 19, 2022, In Re Amendments to Rules for the Court of Tax Review, 2022 OK 99, __P.3d__, 2022 WL 17818701. The thirty (30) day filing period was reduced to twenty (20) days in order to conform with the 2001 amendments to 68 O.S., § 2881. The amendments, among other things, specified that the Oklahoma Tax Commission Form referred to was Form OTC 989. 7 The Form OTC 989 requires identifying information of the protestant, the tax year of protest, information concerning the fair cash value as well as the amount of the fair cash value in controversy and information concerning the assessed value as well as the amount of the assessed value in controversy. It informs the filer to reference 68 O.S. § 2881 for specific information concerning filing a written complaint to the Court of Tax Review. It states that "[f]or timely filing, the Oklahoma Court of Tax Review must be in receipt of the Notice of Protest on or before twenty (20) days from the date listed on the State Board of Equalization's notice of certification to the taxpayer." In addition, it provides "[t]he taxpayer shall have twenty (20) calendar days from the date of the notice [June 16, 2022] in which to file the complaint with the Clerk of the Court of Tax Review . . . ." Mr. Segress appears to have adequately provided the required information on the Form OTC 989 and signed the same. However, he did not file a complaint and the Form OTC 989 is the only document he filed with the Court of Tax Review on July 11, 2022 pertaining to his protest (mailed by certified mail on July 7, 2022). 8 Response to Respondent's Motion for Entry of Order of Dismissal, p.4 (Aug. 29, 2022); "in construing tax laws, that, where there is any ambiguity or doubt, it must be resolved in favor of the person upon whom it is sought to impose the burden (26 Am. & Eng. En. Law [2d Ed.] 669)," McGannon at 1067. 9 68 O.S. 2021, § 221.1 (A) and (B) provide that any document required to be filed within a prescribed period pursuant to a tax law of this state, the date of the stamped postmark shall be deemed the date of delivery and the postmark date must fall on or before the prescribed date for filing. 10 Rule 5 (RCTR) )(amnd. by Order of the Oklahoma Supreme Court in In re: Amendments to Rules for the Oklahoma Court of Tax Review, 1997 OK 85) which was relevant to this tax assessment at all pertinent times: The Chief Justice of the Oklahoma Supreme Court shall assign a case to a judicial administrative district. The presiding judge of the judicial administrative district to which the case is assigned shall appoint a panel of three judges of the district court, who shall determine in what county the case will be heard. 68 O.S.Supp.1996 § 3024 (as amended by H.B. 1338, eff. July 1, 1997). All complaints, protests or notices of intent to appeal, or as many as practical, involving the same county or property in the same county will be assigned to the panel. Unless otherwise designated by the Chief Justice, the senior judge in terms of total years of judicial service shall serve as Chief Judge of the panel. All cases that were assigned to a panel of the Court of Tax Review prior to July 1, 1997 shall remain with the panel assigned for final determination. 68 O.S.Supp.1996 § 3024 (as amended by H.B. 1338, eff. July 1, 1997). This rule requires the Chief Justice of this Court to assign the case to a judicial administrative district. Section 3024 of title 68 requires the assignment be made to a judicial administrative district in which no property that is the subject of the case is located. In order to make that determination this Court needs the information that is required in the complaint which is a required field to complete on the Rule 11, Form No. 1, i.e., the location of the subject property. The July 13, 2022 Order of this Court was requesting this information so that it could make the required assignment. This Court does not make a determination as to whether the protest invokes the jurisdiction of the Court of Tax Review at that time. Once this Court receives the necessary information to make the assignment, then it is left to the Court of Tax Review to determine if its jurisdiction has been properly invoked. And as here, such ruling is available to be appealed to this Court. 11 Title 68 O.S. 2021, § 3024 (A) also requires the Oklahoma Supreme Court to establish rules for the Court of Tax Review. GURICH, J., with whom Kuehn, J., joins, dissenting. ¶1 In this case, Terral Telephone Co. (TTC) filed a protest of an ad valorem tax levied by the Oklahoma State Board of Equalization (OSBE). At every step of the process, TTC's protest was thwarted by contradictory language contained in the Rules of the Court of Tax Review (Rules) and statutes, letters from the Oklahoma Tax Commission purporting to give more time to protest the tax, and even an order of this Court. The totality of the circumstances presented in this case infringe upon TTC's right to due process. For this reason, I respectfully dissent from the majority opinion and would allow TTC's protest to proceed in the Court of Tax Review. ¶2 On June 22, 2022, TTC received a letter from the OSBE, dated June 16, 2022, notifying TTC of the ad valorem tax levied upon TTC's Oklahoma property for the year 2022.1 On June 24, 2022, TTC received a letter from the Oklahoma Tax Commission (OTC), dated June 21, 2022, which included the valuation report (the printout of the company's original cost and assessed values) for TTC's property. The letter stated that TTC had until Thursday, July 7, 2022, to report any discrepancies. ¶3 On July 6, 2022, TTC prepared, dated, and signed a "Notice of Protest to the State Board of Equalization and the OTC of Filing in Court of Tax Review," using OTC Form 989. On July 7, 2022, TTC mailed the Form 989, to the Clerk of the Supreme Court as Clerk of the Court of Tax Review.2 On July 13, 2022, the Supreme Court entered an order noting TTC's filing of Form 989, but directed TTC to file a complaint in compliance with Rule 11, Form No. 1 of the Rules by July 22, 2022. TTC filed its first amended complaint in compliance with the Court's order on July 22, 2022. On August 9, 2022, OSBE filed a motion to dismiss alleging that TTC was untimely in its filing. TTC submitted its response to OSBE's motion to dismiss on August 29, 2022. On November 28, 2022, the Court of Tax Review granted OSBE's motion to dismiss, and TTC filed its Petition in Error with this Court on December 21, 2022. ¶4 The United States Supreme Court held "where an action affects a person's interest in life, liberty or property such person is entitled to notice reasonably calculated, under all the circumstances, to be apprised of the pendency of the action and afforded an opportunity to present objections." Luster v. Bank of Chelsea, 1986 OK 74, 730 P.2d 506, 509 (citing Mullane v. Central Hanover Bank &Trust Co., 339 U.S. 306, 314). For the purposes of due process, corporations are persons. See First Nat. Bank of Boston v. Bellotti, 435 U.S. 765, 780 n.15 ("It has been settled for almost a century that corporations are persons within the meaning of the Fourteenth Amendment."). Importantly, due process is not necessarily satisfied by strict adherence to statutorily prescribed procedures, rather, "[i]t is the totality of the circumstances and conditions of each individual case that determines if the constitutional requirements of due process are satisfied." Luster, 1986 OK 74, 730 P.2d at 509. This Court has recognized that the constitutional guarantee of due process of law applies to administrative as well as judicial proceedings, and it is this Court's constitutional responsibility to ensure that the statutory regime governing appealable administrative orders is consistent with the state's standards of due process. Larry Jones Intern. Ministries Inc., v. Okla. Co. Bd. of Equalization, 1997 OK 125, ¶ 9, 946 P.2d 669, 671. ¶5 In both its Petition in Error and its Response to Respondent's Motion for Entry of Order of Dismissal before the trial court below, TTC asserts that Title 68 and the Rules of the Court of Tax Review conflict because they have different filing deadlines and substantive requirements. Title 68, Section 2881 states, in pertinent part: A. The secretary of the State Board of Equalization shall notify all railroads, air carriers and public service corporations of the ad valorem tax assessments rendered by the State Board, including the valuation, assessment ratio and total amount of assessment. The notice, which shall clearly be marked with the date upon which it was prepared, shall be mailed within one (1) working day of such date. The taxpayer shall have twenty (20) calendar days from the date of the notice in which to file, with the Clerk of the Court of Tax Review, a written complaint on a form prescribed by the Tax Commission, specifying grievances with the pertinent facts in relation thereto in ordinary and concise language, without repetition, and in such manner as to enable a person of common understanding to know what is intended. The complaint shall include the amount of Oklahoma assessed valuation protested and the grounds for the protest. The taxpayer shall be required to send a copy of the complaint to the Tax Commission. B. If the taxpayer fails to file a written complaint within the twenty-day period provided for in this section, then the assessed valuation stated in the notice, without further action of the State Board of Equalization, shall become final and absolute at the expiration of twenty (20) days from the date the notice is mailed to the taxpayer. 68 O.S.2011, § 2881(A)--(B) (emphasis added). ¶6 On its face, this statute is internally inconsistent. The Taxpayer has 20 days from the date of the notice to file a complaint on the Tax Commission form, but the assessed valuation becomes final 20 days from the date the notice is mailed to the taxpayer. In this case, the OSBE has no record of the date of mailing. There is no certificate of mailing on the letter indicating that it was actually sent in compliance with 68 O.S.2011, § 2881(A), which requires such notices to be mailed within one day of issuance. ¶7 Moreover, this statute is directly in conflict with Rule 3 of the Court of Tax Review, in effect at the time of this appeal, which states: A. Strict Compliance. Complaints and notices of intent to appeal shall be in strict compliance with the following: 1. An original and four copies of all pleadings, complaints, protests, notices of intent to appeal, responses and other filings shall be prepared on 8 1/2 " x 11" paper only. 2. In all proceedings the complaint, notice, or protest must state the county in which the property which is the subject of the proceeding is located. 3. In all proceedings where the Oklahoma Tax Commission is required by statute to prescribe the form for filing a complaint or notice with the Court of Tax Review a completed copy of the form shall be attached to the complaint or notice filed with the Court of Tax Review. 4. Proceeding pursuant to § 2881: A complaint filed with the Court of Tax Review pursuant to 68 O.S.Supp.1995 § 2881 (as amended by H.B. 1338, eff. July 1, 1997), must comply with Rule 11 Form No. 1. The Complaint must state the year of the ad valorem assessment to be reviewed. The Complaint must have attached as Exhibit A the properly completed form prescribed by the Oklahoma Tax Commission. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint must specify the counties where the property is located. The Complaint must be filed within thirty (30) days of the notice of assessment, and the Complaint must have attached as Exhibit B a copy of the notice. 68 O.S.Supp.1995 § 2881(A), (as amended by H.B. 1338, eff. July 1, 1997). The Complaint shall specify the amount of the assessed valuation protested. Id. B. Substantial Compliance. Complaints, protests, and notices of intent to appeal shall be in substantial compliance with the applicable provisions of Title 68 authorizing the filing thereof.3 68 O.S. Ch. 1, Art. 28, Rule 3 (emphasis added). ¶8 The contradictions contained in the statute and Rule 3 are confusing and misleading as to what a complainant must do to file a conforming and timely appeal. For instance, in order to file a protest, section 2881(A) requires that the taxpayer file a written complaint within 20 days of the date of the notice.4 Section 2881(A) also requires that a written complaint be on a form prescribed by the OTC. The OTC prescribes Form 989 as its Notice of Protest to the State Board of Equalization and the Oklahoma Tax Commission of Filing in Court of Tax Review.5 The Rules, however, contain language that directly conflicts with Section 2881. Rule 3(A)(4) requires that the complaint be filed within 30 days of the date of the notice of assessment. Further, Rules 3(A) and 11 require that a tax payer not file the Form 989, but instead attach the form as an exhibit to a complaint form prescribed by the Supreme Court. A taxpayer is further mislead by Rule 3(B) because it only requires substantial compliance with the statute. The text of Rule 3(A), however, requires strict compliance with the Rule. The taxpayer must choose between sets of instructions and then make a judgment call on which to follow--this does not put the taxpayer on notice as to the correct procedure for filing a compliant protest. If a mistake is made, the taxpayer is then deprived of a meaningful opportunity to be heard. ¶9 The failure to ensure that TTC's due process rights were protected does not end with the questionable wording of statutes and rules. To understand why TTC's right to due process was violated, it is important to not only look at the statutorily mandated time to appeal, as the majority does, but also to address the conflicting information TTC received from the OSBE and OTC during the relevant time period. In a letter dated June 16, 2022, the OSBE advised TTC of the ad valorem taxation for the year 2022.6 In pertinent part, the letter states: In accordance with the provision of 68 O.S. § 2881, and the Rules of the Court of Tax Review, 68 O.S. Ch. 1, Art. 28, App., this amount shall be final and absolute at the expiration of twenty (20) days from the date of this notice unless written complaint is filed with the Clerk of the Court of Tax Review. Rule 11 of the Rules of the Court of Tax Review provides the format for the complaint.7 However, on June 21, 2022, the OTC mailed a letter with a printout of TTC's original cost and assessed values for the 2022 assessment year. In this letter, which noted AD VALOREM over the date, the OTC stated: "Please verify the accuracy of this data immediately. Verification and confirmation of this information is critical. . . . Report all discrepancies no later than Thursday, July 7, 2022."8 Following the OTC's instruction, TTC mailed its Form 989 to protest the valuation of its ad valorem taxes on July 7, 2022, within the OTC's asserted deadline.9 Since the date of mailing is considered the filing date for the Court of Tax Review,10 TTC timely filed its protest to the ad valorem taxes assessed by OSBE, as required by the letter from OTC. The date of filing is especially important to note because Rule 3 advises a taxpayer that only substantial compliance with the statute is required, and Rule 3 allows thirty (30) days for filing a protest in the Court of Tax Review. ¶10 This case is even further complicated when we consider this Court's actions. First, the Clerk of the Supreme Court (who is also the Clerk of Court of Tax Review pursuant to 68 O.S.2011, § 3024) file-stamped receipt of TTC's Form 989 on July 11, 2023.11 Oklahoma Supreme Court Rule 1.4(c) states that when a petition is delivered by the United States Postal Service, the postmark or date stamped by the post office upon a certified mail receipt, is deemed to be the date of filing of the petition. This is commonly known as the mailbox rule. TTC submitted evidence that the date of mailing was July 7, so the date of filing should have been July 7, 2022.12 ¶11 Second, after TTC filed Form 989, this Court sent an Order noting the filing of the form, but requiring TTC to submit a complaint conforming to Rule 11, Form 1, as required by Rule 3.13 This Court gave TTC until July 22, 2022--6 days past Rule 3's thirty day deadline--to submit its revised complaint.14 TTC timely submitted the form by the time specified.15 At no time did this Court advise TTC that by filing Form 989, TTC was out of time.16 Instead, the taxpayer interpreted this order as an extension of the deadline to file its amended complaint. The majority asserts that TTC missed the 30 day deadline required by Rule 3 and therefore lost the right to claim a timely filing pursuant to Rule 3.17 Isn't that convenient? This is clearly a trap because the actions of this Court, which misled TTC, caused it to miss the Rule 3 deadline. ¶12 The Court of Tax Review dismissed this case because it concluded that the actions of the OSBE, OTC and the Supreme Court were not binding on that court, and concluded that the protest was untimely filed and not in substantial compliance with section 2881. The Court of Tax Review also dismissed TTC's protest due to the fact that "OTC 989 is null and void as the purported complaint was not signed by an attorney."18 The requirement that a corporation cannot file Form 989 or a complaint without the signature of an attorney is not explained in either section 2881 or Rule 3. Form 989 does not list such a requirement or provide a signature block specifically for an attorney. Further, neither the letters from OSBE or OTC nor the order of this Court put TTC on notice that it must be represented by counsel. Assuming the CEO of TTC was familiar with other procedural rules or statutes, nothing alerted TTC to the fact that it must be represented by counsel. Oklahoma Supreme Court Rule 1.5(b), which specifically states that corporations must be represented by counsel, is inapplicable because this rule only applies to "parties to actions in the Supreme Court or Court of Civil Appeals." 12 O.S. 2022, App. 1, Rule 1.5(b). The Entry of Appearance statute, 12 O.S.2011, § 2005.2, also does not clearly put a corporation on notice that it needs counsel. It only addresses corporations by stating: "If no entry of appearance is filed within thirty (30) days from the date of the order permitting withdrawal, then the unrepresented party, other than a corporation, is deemed to be . . . acting pro se." 12 O.S.2011, § 2005.2. Rule 11, Form 1 which requires an attestation of SERVICE BY COUNSEL, was the first time TTC was alerted to the fact that it needed to be represented by an attorney in this proceeding, and the Amended Complaint was signed by counsel. ¶13 Every time TTC was instructed to perform an action, TTC complied. Yet, the majority concludes that because the untimely filing of TTC's complaint is jurisdictional, the decision of the Court of Tax Review must be upheld. In order to arrive at this conclusion, the majority ignores the totality of the circumstances facing this taxpayer. Arguably, TTC's complaint was timely. Even assuming it was untimely, TTC's right to due process was violated. It is not a single occurrence in this case that led to the violation of due process, but instead the numerous snares that worked together to deprive TTC of the right to protest the assessment by the OSBE. First, there are multiple internal conflicts in both the statute and Rules. Second, there are conflicts between statute and the Rules that prevented TTC from even being able to determine what constituted a timely filing, or even what constituted a compliant filing. Third, there is a conflict between the dates given in the OSBE and OTC letters, with the latter purporting to give TTC a later date by which to report any discrepancies. Fourth, the Clerk of the Court of Tax Review did not timely file-stamp TTC's protest Form 989, adding to confusion regarding the timeliness of the filing. Fifth, this Court issued an order which purported to give TTC extra time to file a conforming complaint. Just to put a nail in the coffin, the majority finds that TTC's first amended complaint filed on the date specified by court order, was untimely because the complaint was filed after the 30 day limitation of Rule 3. Lastly, there was nothing in the statutes, Rules, letters, or orders that would put TTC on notice that it had to have an attorney to file a protest in this case. The combined effect of this morass is to deny TTC its right to due process. For these reasons, I dissent. FOOTNOTES 1 Appellant's R. on Accelerated Appeal, Tab 7, p. 2. 2 The Clerk of the Court of Tax Review file stamped receipt of the Form 989 as July 11, 2022. However, TTC's certificate of mailing shows that the form was mailed by certified mail on July 7, 2022. Terral Tel. Co.'s Resp. to Resp't's Mot. for Entry of Order of Dismissal, Exhibit A-4. Therefore, the date of TTC's filing with the Court of Tax Review should be July 7, 2022. The majority also notes this discrepancy in footnote 7. See also 12 O.S. Supp. 2021, App. 1, Rule 1.4(c), (e) (this Rule was amended by order of the Supreme Court, 2023 OK 44, and will become effective June 1, 2023. At that time, Rules 1.4(c) and --(e) will be re-lettered as 1.4(d) and --(f)). 3 Rule 3 was amended by this Court on December 19, 2022, to denote the correct filing period of twenty (20) days from the date of the notice of assessment. Rule 3 was further amended on April 17, 2023, to remove the conflicting requirements of strict and substantial compliance. 4 To add to the confusion, the current language of Okla. Admin. Code 255:10-5-2 conflicts with both section 2881 and Rule 3, and also refers to an outdated statute (section 2466 was repealed in HB 1588 in 1991, however, it dealt with appealing findings of the OSBE). The pertinent provision of the OAC states: "Pursuant to Title 68, Section 2466, in any case where the Board shall increase the valuation of property of any railroad or public service corporation above the value returned by the taxpayer, the Secretary of the Board shall notify the taxpayer by mail, giving the amount of such valuation as increased. The taxpayer shall have ten (10) days from the date of such notice in which to file, with the Secretary of the Board, a written complaint, specifying his grievances, and the pertinent facts in relation thereto in ordinary and concise language and without repetition, and in such manner as to enable a person of common understanding to know what is intended." Okla. Admin. Code 255:10-5-2 (emphasis added). 5 Although Form 989 contains the language of section 2881 on the second page, the form does nothing to point the taxpayer to the Rules for the Court of Tax Review, which contain far more detailed and complicated requirements for filing a complaint than those laid out in statute. 6 Terral Tel. Co.'s Resp. to Resp't's Mot. for Entry of Order of Dismissal, Exhibit A-2. 7 Id. 8 Id., Exhibit A-3. 9 Id., Exhibit A-2, A-4. 10 12 O.S. Supp. 2021, App. 1, Rule 1.4(c) provides: "When a petition is delivered by the United States Postal Service, the date of mailing as shown by the postmark or other proof from the post office, such as the date stamped by the post office upon a certified mail receipt or post office tracking history, will be deemed to be the date of filing the petition." This provision is specifically made applicable to the Court of Tax Review by 12 O.S. Supp. 2021, App. 1, Rule 1.4(e). 11 Appellant's R. on Accelerated Appeal, Tab 1. 12 Terral Tel. Co.'s Resp. to Resp't's Mot. for Entry of Order of Dismissal, Exhibit A-4. 13 Appellant's R. on Accelerated Appeal, Tab 2. 14 Id. 15 Terral Tel. Co.'s Resp. to Resp't's Mot. for Entry of Order of Dismissal 4. 16 The Form 1 complaint requires the taxpayer to identify the county so as to facilitate the assignment of judges to the Court of Tax Review. 17 "Even if the thirty (30) day period was found to be applicable, TTC's first amended complaint would have to have been filed within thirty (30) days from the date listed on the notice of assessment in order to invoke the jurisdiction of the Court of Tax Review and July 22, 2022 would have been more than thirty days from that date." Majority Op. 17. 18 Appellant's R. on Accelerated Appeal, Tab 9, p. 2.

f9be5d51-9653-49fd-af20-727e0331708d

Shellem v. Gruneweld

oklahoma

Oklahoma Supreme Court

SHELLEM v. GRUNEWELD2023 OK 26Case Number: 120131Decided: 03/28/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. BRIAN and JANELLE SHELLEM, Husband and Wife, individually and on behalf of their Minor Children, C.S. and M.S.; BRETT and EMILIE GARRELTS, Husband and Wife, individually and on behalf of their Minor Child, B.G.; and GRAY and THERESA EPPERLY, Husband and Wife, individually and on behalf of their Minor Children, L.E., C.E., O.E., and M.E., Plaintiffs/Appellees, v. ANGELA GRUNEWELD, Superintendent of Edmond Public Schools, and Edmond Board of Education Members JAMIE UNDERWOOD, CYNTHIA BENSON, KATHLEEN DUNCAN, LEE ANN KUHLMAN, and MEREDITH EXLINE, sued in their official and individual capacities, Defendants/Appellants. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY HONORABLE DON ANDREWS, DISTRICT JUDGE ¶0 Parents, individually, and on behalf of their minor children, filed a Petition for Declaratory Judgment and Injunctive Relief and an Application for Temporary Restraining Order requesting the trial court enjoin Edmond Public School District from enforcing its quarantine policy. The quarantine policy required unvaccinated students who have not tested positive for COVID-19 within ninety days and who are identified as a close contact to quarantine for either seven or ten days; whereas vaccinated students who are identified as a close contact are not required to quarantine. The trial court denied the parents' Temporary Restraining Order, but granted a Temporary Injunction on the basis that the parents established the quarantine policy likely violated the Equal Protection Clause of the 14th Amendment to the United States Constitution. The Edmond Public School District appealed and we retained the matter. We vacate the trial court's order and grant declaratory relief. MATTER PREVIOUSLY RETAINED FOR DISPOSITION; ORDER OF THE DISTRICT COURT VACATED; DECLARATORY JUDGMENT GRANTED. Stanley M. Ward, Noble, Oklahoma, and Richard Labarthe and Alexey Tarasov, LABARTHE & TARASOV, a professional association, Norman and Oklahoma City, Oklahoma for Plaintiffs/Appellees. F. Andrew Fugitt and Justin C. Cliburn, THE CENTER FOR EDUCATION LAW, a professional association, Oklahoma City, Oklahoma for Defendants/Appellants. OPINION ROWE, V.C.J.: I. BACKGROUND ¶1 During the summer of 2021, Appellants, Edmond Public School Board Members and Edmond Public School District Superintendent, Angela Grunewald, (collectively "District") anticipated a complete return to in-person instruction for the 2021-2022 school year. Prior to the start of the school year, the Oklahoma City County Health Department ("OCCHD") expressed to District that quarantines should be recommended rather than required. In response, District prepared a standard letter that alerted parents when their child was exposed to a positive COVID-19 case, which left the responsibility "for carrying out a quarantine or not" up to the parents.1 School began on Thursday, August 12, 2021. By the fourth day of school, District reported 140 positive cases of COVID-19 which rose to 170 positive cases on the fifth day of the school year. ¶2 Based on guidance from the Centers for Disease Control and Prevention ("CDC"), OCCHD informed District that individuals deemed a "close contact"2 should quarantine in light of the drastic spike of positive COVID-19 cases within the first week of the school year. OCCHD strongly recommended close contacts quarantine for 7-10 days unless (A) the close contact was vaccinated against COVID-19 or (B) the close contact had tested positive in the previous 90 days (the "Policy"). The following day, District implemented a policy consistent with OCCHD's recommendation and informed parents of the Policy by email. 3 ¶3 The Policy provided that a vaccinated close contact was not required to quarantine unless he or she displayed symptoms, but an unvaccinated close contact that had not tested positive within ninety days was required to quarantine. In the case of being identified as a close contact, the unvaccinated individual was presented with two options for quarantine: (1) a 7-day quarantine, in which the individual may return to school on day 8 if he or she provides a negative COVID-19 test on or after day 5 and continues to remain symptom free; or (2) a 10-day quarantine, in which the individual may return to school on or after day 11 if he or she remains symptom free. ¶4 As a result of the Policy, several unvaccinated students were required to quarantine due to being identified as a close contact. The Appellees, parents of children enrolled in Edmond Public Schools affected by the Policy ("Parents"), individually and on behalf of their children, filed a Petition for Declaratory Judgment and Injunctive Relief and an Application for Temporary Restraining Order ("TRO") in the District Court of Oklahoma County. Parents alleged the Policy violated: (1) 70 O.S. § 1210.189(A)(1); (2) their children's Fourteenth Amendment right to procedural due process; and (3) their children's First Amendment right to freely assemble. District objected, and the TRO was denied. ¶5 Following denial of the TRO, the trial court heard testimony on Parents' Petition for Injunctive Relief. A week later, the Attorney General filed a motion for leave to file an amicus curiae brief in support of granting Parents' Injunction on the basis that the Policy violates 70 O.S.Supp.2021, § 1210.189(A)(1). District objected to the filing of the brief, but the trial court granted the Attorney General's motion. The trial court denied relief on all three counts pleaded in the Petition, but granted a Temporary Injunction based on Parents' Equal Protection Clause argument and enjoined District from implementing or enforcing the Policy. ¶6 District timely appealed raising five counts of error relating to the trial court's Equal Protection analysis and inconsistencies of the trial court's order concerning evidence of irreparable harm. In addition, the Attorney General filed an amicus curiae brief with consent of the parties suggesting to the Court that while the trial court properly enjoined District from enforcing the Policy, the trial court improperly interpreted 70 O.S.Supp.2021, § 1210.189(A)(1). Neither Parents nor District filed a response to the Attorney General's amicus brief. We retained the matter for review. II. STANDARD OF REVIEW ¶7 To obtain a temporary injunction, a plaintiff must show that four factors weigh in his or her favor: (1) the likelihood of success on the merits; (2) irreparable harm to the party seeking the relief if the injunction is denied; (3) their threatened injury outweighs the injury the opposing party will suffer under the injunction; and (4) the injunction is in the public interest. Edwards v. Bd. Of Cnty Comm'rs of Canadian Cnty, 2015 OK 58, ¶ 12, 378 P.3d 54, 59. "The right to injunctive relief must be established by clear and convincing evidence and the nature of the injury must not be nominal, theoretical, or speculative." Id. ¶8 "A judgment issuing or refusing to issue an injunction will not be disturbed on appeal unless the lower court has abused its discretion or the decision is clearly against the weight of the evidence." Id. ¶ 11, 378 P.3d at 58. "To reverse under an abuse of discretion standard, an appellate court must find the trial court's conclusions and judgment were clearly erroneous, against reason and evidence." Murlin v. Pearman, 2016 OK 47, ¶ 17, 371 P.3d 1094, 1097. We will consider all the evidence on appeal to determine whether the trial court's granting of a temporary injunction was an abuse of discretion. Dowell v. Pletcher, 2013 OK 50, ¶ 5, 304 P.3d 457, 460. ¶9 "[A] clear abuse of discretion standard includes appellate review of both fact and law issues: 'In order to determine whether there was an abuse of discretion, a review of the facts and the law is essential.'" Christian v. Gray, 2003 OK 10, ¶ 43, 65 P.3d 591, 608 (quoting Bd. of Regents of Univ. of Oklahoma v. Nat'l Collegiate Athletic Ass'n, 1977 OK 17, ¶ 3, 561 P.2d 499, 502). Underlying questions of law are reviewed de novo. Lierly v. Tidewater Petroleum Corp., 2006 OK 47, ¶ 16, 139 P.3d 897, 903. An issue presented in this cause is one of statutory interpretation. Statutory interpretation presents a question of law which this Court reviews under a de novo standard. Corbeil v. Emricks Van & Storage, Guarantee Ins., 2017 OK 71, ¶ 10, 404 P.3d 856, 858. ¶10 The trial court determined Parents were likely to succeed on the merits of their Equal Protection Clause claim against District but were unlikely to succeed on the merits of their claim that the Policy violated 70 O.S.Supp.2021, § 1210.189(A)(1). We find the trial court improperly interpreted § 1210.189(A)(1) and incorrectly concluded Parents were unlikely to succeed on the merits of their claim that the Policy violates § 1210.189(A)(1). Because we determine the Policy violates 70 O.S.Supp.2021, § 1210.189(A)(1), we need not address the Equal Protection Clause argument. III. DISCUSSION ¶11 On March 15, 2020, Oklahoma Governor, J. Kevin Stitt, declared a statewide emergency due to the coronavirus pandemic and its threat to the people of this State and their peace, health, and safety.4 The Governor rescinded his emergency declaration on May 3, 2021.5 Subsequently, the Oklahoma Legislature passed Senate Bill 658 in May of 2021, which was signed into law on May 28, 2021. ¶12 Senate Bill 658 made additions and amendments to school health and safety statutes within 70 O.S.2011, §§ 1210.191-1210.194. Specifically, Senate Bill 658 created two new sections, 70 O.S.Supp.2021, §§ 1210.189 and 190.6 The relevant section here is § 1210.189. Section 1210.189 concerns restrictions on a school district's ability to mandate COVID-19 vaccinations and mask mandates. More specifically, § 1210.189 provides: A. A board of education of a public school district or a technology center school district, the board of regents of an institution within The Oklahoma State System of Higher Education, the governing board of a private postsecondary educational institution, the Oklahoma State Regents for Higher Education, the State Board of Education or the State Board of Career and Technology Education shall not: 1. Require a vaccination against Coronavirus disease 2019 (COVID-19) as a condition of admittance to or attendance of the school or institution; 2. Require a vaccine passport as a condition of admittance to or attendance of the school or institution; or 3. Implement a mask mandate for students who have not been vaccinated against COVID-19. B. As used in this section, "vaccine passport" means documentation that an individual has been vaccinated against COVID-19. C. Nothing in this section shall be construed to apply to any public or private healthcare setting. The subsection at issue before us is § 1210.189(A)(1). ¶13 Before the trial court, Parents and the Attorney General argued the Policy violates § 1210.189(A)(1) because the Policy's quarantine requirement for unvaccinated students effectively excludes those students from attending school due to their COVID-19 vaccination status. District made several arguments in response to demonstrate the Policy does not violate § 1210.189(A)(1). First, District argues the Policy is not based on COVID-19 vaccination status, pointing out that hundreds of unvaccinated students attend school within the district each day. Specifically, District contends COVID-19 vaccination status is not the only condition that triggers whether a student is required to quarantine. Rather, District asserts what determines whether a student should be temporarily quarantined is evidence of that student's heightened immunity to COVID-19. District highlights that the Policy references three types of students exposed to a positive COVID-19 case: (1) vaccinated students; (2) unvaccinated students who have tested positive for COVID-19 within the previous ninety days; and (3) unvaccinated students who have not tested positive for COVID-19 within the previous ninety days. ¶14 To the extent District uses a student's vaccination status as a factor of whether they can attend school, § 1210.189(A)(1) is violated. The statute explicitly prohibits school districts from utilizing a student's COVID-19 vaccination status as a condition of whether he or she may attend school in-person. The Policy's consideration of whether a student has tested positive for COVID-19 within the previous ninety days in addition to a student's COVID-19 vaccination status does not cure the violation. If we were to conclude that the Policy does not violate § 1210.189(A)(1) because the Policy also factors in whether a student has tested positive for COVID-19 within the previous ninety days, the result would run contrary to the intent and plain language of the statute. Interpreting the Policy's condition for quarantine as a level of heightened immunity is a distraction from what the Policy on its face and in practice accomplishes: conditioning a student's attendance of school on COVID-19 vaccination status. Accordingly, District's argument on this point fails. ¶15 Second, District contends quarantined students that participate in virtual learning are counted in "attendance;" therefore, the Policy does not violate § 1210.189(A)(1). Parents and the Attorney General argue "attendance" means physical, in-person attendance. Conversely, District argues that in light of the pandemic, "attendance" is not limited to physical, in-person attendance because of the implementation of virtual learning. ¶16 "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by the statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. "It is presumed that the Legislature has expressed its intent in a statute's language and that it intended what it so expressed." Id. "Intent is ascertained from the whole act in light of its general purpose and objective considering relevant provisions together to give full force and effect to each." Keating v. Edmondson, 2001 OK 110, ¶ 8, 37 P.3d 882, 886. "Only where legislative intent cannot be ascertained from the language of a statute, as in cases of ambiguity, are rules of statutory interpretation employed." Odom, ¶ 18, 415 P.3d at 528. ¶17 To ascertain legislative intent, we begin with the text. The plain meaning of "attendance" is "the act or fact of attending something."7 The plain meaning of "attend" is "to be present at: to go to."8 Nothing in the text suggests the Legislature intended for "attendance" to mean anything more than in-person, physical attendance. Odom, ¶ 17, 415 P.3d at 528 ("It is presumed that the Legislature has expressed its intent in a statute's language and that it intended what it so expressed."); Stemmons, Inc. v. Universal C.I.T. Credit Corp., 1956 OK 221, ¶ 21, 301 P.2d 212, 216 ("In absence of an attempt to define any of the terms used in the statutes in question, it must be presumed the legislature considered it unnecessary to define particular words and phrases, and that it was intended only that same bear their usual and commonly accepted meaning."). We find "attendance" unambiguous. ¶18 Though we need not explore other provisions within Title 70 to aid us in ascertaining the Legislature's intent, doing so leads us to the same conclusion. Reading 70 O.S.2011, § 1210.194 in conjunction with § 1210.189(A)(1), it is clear the Legislature intended for "attendance" to mean in-person, physical attendance. Section 1210.194 discusses the prohibition of students from attending school when afflicted by a contagious disease or head lice. Subsection (A) provides "[a]ny child afflicted with a contagious disease . . . may be prohibited from attending a public . . . school until such time as he is free from the contagious disease . . . ." 70 O.S.2011, § 1210.194(A) (emphasis added). It would be absurd to conclude the Legislature intended for "attending" to mean anything other than in-person physical attendance. Ledbetter v. Oklahoma Alcoholic Beverage L. Enf't Comm'n, 1988 OK 117, ¶ 7, 764 P.2d 172, 179 ("[S]tatutory construction that would lead to an absurdity must be avoided and a rational construction should be given to a statute if the language fairly permits."). ¶19 While it appears that District's intention was to curb the spread of COVID-19, the Policy effectively prohibits unvaccinated students from attending school when exposed to COVID-19 because of their COVID-19 vaccination status. Because we hold "attendance" means in-person, physical attendance, we find the Policy violates § 1210.189(A)(1). Accordingly, the trial court erred when it concluded Parents were unlikely to succeed on the merits of their claim the Policy violates 70 O.S.Supp.2021, § 1210.189(A)(1). ¶20 Our determination that "attendance" unambiguously means in-person, physical attendance renders it unnecessary to address the other construction-based arguments proffered by District. "A cardinal precept of statutory construction is that where a statute's language is plain and unambiguous, and the meaning clear and unmistakable, no justification exists for the use of interpretive devices to fabricate a different meaning." Keating v. Edmonson, 2001 OK 110, ¶ 15, 37 P.3d 882, 888. District's suggestion that we look to the State Board of Education's administrative code 2021 amendment for an alternate definition of "attendance" runs counter to our principles of statutory construction. "[A]dministrative construction of a statute will not override the plain statutory language." Id. We will not look to the administrative code to override the plain meaning of an unambiguous statutory term. ¶21 Lastly, we also find the trial court erred when it interpreted 1210.189(A)(1) as "prohibit[ing] a school district from placing an unvaccinated student into quarantine, even if that student was symptomatic and/or tested positive for COVID-19."9 District retains the statutory authority to exclude a student from the school premises if afflicted with a contagious disease.10 IV. CONCLUSION ¶22 District adopted a quarantine policy in response to a dramatic spike in positive COVID-19 cases. The Policy effectively prohibited students from attending school in-person based upon their COVID-19 vaccination status, in violation of 70 O.S.Supp.2021, § 1210.189(A)(1). Thus, the trial court improperly interpreted § 1210.189(A)(1) and erred by determining Parents would likely be successful on the merits of their Equal Protection Clause claim. ¶23 With the passage of 70 O.S.Supp.2021, § 1210.189(A)(1), the Legislature divested school districts from establishing policies that condition a student's school attendance on their COVID-19 vaccination status. We find District's policy violates § 1210.189(A)(1). The trial court's order is vacated and declaratory judgment is granted in favor of Parents. MATTER PREVIOUSLY RETAINED FOR DISPOSITION; ORDER OF THE DISTRICT COURT VACATED; DECLARATORY JUDGMENT GRANTED. Kane, C.J., Rowe, V.C.J., Winchester, Darby and Kuehn, JJ., concur. Kauger, J. (by separate writing), Edmondson, Combs (by separate writing), and Gurich, JJ., dissent. FOOTNOTES 1 "In the case of a quarantine notification, parents will be notified if their child has been in close contact with a positive case, and the parent will be responsible for carrying out the quarantine or not." Ex. to Pls.' Appl. for Temporary Inj., Defs.' Ex. 9. 2 "Defined as being within six feet of a positive individual for a period of 15 minutes or more or within three feet if both parties are masked." Temporary Inj. Order 2, n.2. 3 The Policy was initially provided to parents through a letter sent via email on August 18, 2021. See Ex. To Pls.' Appl. For Temporary Inj. Defs.' Ex. 3. Included on the letter was a link to District's website, edmondschools.net, which provided the specific protocols to be followed starting August 18, 2021. See Ex. to Pls.' Appl. for Temporary Inj., Defs.' Ex. 4. 4 The Governor's Executive Order 2020-07, filed with the Oklahoma Secretary of State on March 15, 2020, states in pertinent part: Therefore, I, J. Kevin Stitt, Governor of the State of Oklahoma, pursuant to the power vested in me by Section 2 of Article VI of the Oklahoma Constitution, hereby declare and order the following: There is hereby declared an emergency caused by the impending threat of COVID-19 to the people of this State and the public's peace, health, and safety. Exec. Order No. 2020-07, https://www.sos.ok.gov/documents/executive/1913.pdf. 5 The Governor's Executive Order 2021-11, filed with the Oklahoma Secretary of State on May 3, 2021 states in pertinent part: I, J. Kevin Stitt, Governor of the State of Oklahoma, pursuant to the power vested in my by Section 2 of Article VI of the Oklahoma Constitution hereby order: Effective May 4, 2021, Second Amended Executive Order 2021-07 is withdrawn and rescinded. Exec. Order No. 2021-11, https://www.sos.ok.gov/documents/executive/1999.pdf. 6 In Ritter v. State, 2022 OK 73, 520 P.3d 370, this Court determined 70 O.S.Supp.2021, §§ 1210.189 and 190 were an unconstitutional, impermissible delegation of Legislative authority. However, the objectionable provision was stricken, and the remainder of the statute was upheld as constitutional. The text that was stricken arises from § 1210.190(A)(1) which provides: A. A board of education of a public school district or a technology center school district may only implement a mandate to wear a mask or any other medical device as provided in this subsection. 1. A board of education of a public school district or a technology center school district may only implement a mandate to wear a mask or any other medical device after consultation with the local county health department or city-county health department within the jurisdiction of where the board is located and when the jurisdiction of where the board is located is under a current state of emergency declared by the Governor. The Court determined that the emphasized language usurped local control granted by the Legislature by requiring the Governor to declare or not declare a state of emergency--an impermissible delegation of authority. The result in Ritter has no effect on the application of § 1210.189 as it relates to the case before us, as the Court held the remainder of the statute was constitutional. 7 Attendance, Merriam-Webster, https://www.merriam-webster.com/dictionary/attendance (visited February 8, 2023). 8 Attend, Merriam-Webster, https://www.merriam-webster.com/dictionary/attend (visited February 8, 2023). 9 Temporary Inj. Order 6. 10 63 O.S.Supp.2021, § 1-507 and 70 O.S.2011, § 1210.194 provide school districts the ability to prohibit a student afflicted with a contagious disease from attending school. Thus, if an unvaccinated student exhibited symptoms of COVID-19 and/or tested positive, District retains the statutory authority to exclude student from the school premises. 63 O.S.Supp.2021, § 1-507 provides: No person having a communicable disease shall be permitted to attend a private or public school, and it shall be the duty of the parent or guardian and the school of such person to exclude from the school such person until the expiration of the period of isolation or quarantine ordered for the case, or until permission to do so shall have been given by the local county health department or the State Department of Health. 70 O.S.2011, § 1210.194(A) provides: Any child afflicted with a contagious disease or head lice may be prohibited from attending public, private, or parochial school until such time as he is free from the contagious disease or head lice. KAUGER, J., with whom Gurich, J. joins: ¶1 I agree with the dissent by Justice Combs for yet another reason. The Oklahoma Constitution art. 13 §4 addresses compulsory school attendance and the possibility of alternatives. It provides: The Legislature shall provide for the compulsory attendance at some public or other school, unless other means of education are provided, of all the children in the State who are sound in mind and body, between the ages of eight and sixteen years, for at least three months in each year. ¶2 Although the framers did not anticipate virtual schooling, they were prescient by recognizing that another means, other than actual attendance, was possible to fulfill the attendance requirement. COMBS, J., with whom KAUGER, EDMONDSON, and GURICH, JJ., join, dissenting: ¶1 I dissent from the majority's judgment. Their judgment vacating the trial court's temporary injunction in favor of Appellee Parents but then granting declaratory judgment in favor of Parents is most irregular. The irregular judgment is a product of the majority's unconventional approach to appellate review in this case. Had the majority chosen to address the issues raised in Appellant District's Petition in Error and Brief in Chief--i.e., issues related to the trial court's findings that Parents would likely succeed on their claim that the District's COVID-19 quarantine policy violated the Equal Protection rights of Parents' children, that Parents' evidence supported a finding of irreparable harm, and that the threatened injury to Parents' children outweighed any potential injury to the District, see Pet. in Error ex. C (listing seven "ISSUES TO BE RAISED ON APPEAL); Br. in Chief of Appellants ii (listing five propositions in the brief's index)--the majority would predictably either affirm or reverse the trial court's temporary injunction. Instead, the majority opines upon an issue that is not before this Court for appellate review--i.e., whether the trial court erred in its interpretation of 70 O.S.2021, § 1210.189(A)(1) and in its resulting denial of Appellee Parents' request for declaratory relief on that basis--because neither party has raised it. ¶2 It should go without saying that arguments which have not been presented in the petition in error or in the parties' briefs should be treated as abandoned, waived, or not preserved for appellate review. See Reddell v. Johnson, 1997 OK 86, ¶ 6, 942 P.2d 200, 202 ("An appellate court is generally confined to the issue raised by the parties and presented by the proof, pleadings, petition in error and briefs. It is the duty of the parties to frame the issues." (citations omitted)); Okla. Turnpike Auth. v. Little, 1993 OK 116, ¶ 10, 860 P.2d 226, 228 ("Generally, this Court will not consider or review errors or issues that have not been raised by the petition in error."); State ex rel. Remy v. City of Norman, 1981 OK 139, ¶ 12, 642 P.2d 219, 222 ("Any assignments of alleged error not presented in the briefs will be treated as abandoned."). The District did not raise any error concerning the trial court's statutory construction of section 1210.189(A)(1) and indeed would have no interest in raising an issue the trial court decided in its favor; and Parents never filed a counter-appeal to raise that issue. In fact, as the majority acknowledges, the issue has been raised only in the Oklahoma Attorney General's amicus brief (filed during the tenure of former Attorney General John O'Connor), and "[n]either Parents nor District [have] filed a response" thereto. Majority Op. ¶ 6. The parties did not preserve the issue for appellate review, and there is consequently no basis for the majority to render their judgment on appeal vacating the trial court's temporary injunction and granting declaratory judgment in Parents' favor. ¶3 Faced with the issues actually presented in this appeal, I would have reversed the trial court's temporary injunction because I do not believe Parents would likely succeed on Equal Protection grounds. The guidance from both the city-county health department and the CDC serve as a rational basis for the District's implementation of a quarantine policy that differentiates between students who have either been vaccinated against or recently recovered from COVID-19 and students who have not. ¶4 But I also write separately because I disagree with the majority's statutory construction of section 1210.189(A)(1). The District's quarantine policy does not violate section 1210.189(A)(1)'s prohibition against "requir[ing] a vaccination . . . as a condition of admittance to or attendance of the school or institution." That's because, as the trial court recognized, section 1210.189 "is silent and makes no mention of a school district's authority to quarantine students." ROA p.000107, Order on Temporary Inj. 7. Nothing about that statutory provision prevents the school district from implementing a common-sense quarantine policy based upon input from the local city-county health department that differentiates between students whose immune systems are bolstered against infection through either vaccination or recent prior infection and other students. If the Legislature wanted to curb such quarantine policies, it could have included language to that effect. It didn't. ¶5 Instead, the Legislature drafted section 1210.189 to prevent school districts from imposing vaccine mandates that would condition annual enrollment and admittance upon proof of vaccination. Looking at the overall scheme of the legislative bill that enacted section 1210.189, i.e., Senate Bill 658 of the he 58th Legislature's First Regular Session, it becomes clear what the Legislature was trying to do. On one hand, existing statutory law in section 1210.191(A) provided that "[n]o minor child shall be admitted to any public, private or parochial school operating in this state unless and until certification is presented to the appropriate school authorities . . . that such child has received or is in the process of receiving, immunizations" against a laundry list of contagious diseases. By enacting section 1210.189(A)(1), the Legislature demonstrated that it didn't want school districts to use the COVID-19 vaccine in a similar way. That is, the Legislature didn't want school districts to be able to exclude children from enrollment, admittance, and attendance at their schools indefinitely unless and until proof of a COVID-19 vaccination was provided. So the Legislature enacted section 1210.189(A)(1) to prevent long-term exclusion of large portions of the student body. Section 1210.189(A)(1) was not targeted at quarantine policies, as such policies would only exclude a limited amount of exposed and sick children, would only prevent daily attendance for a week or two, and would not condition the children's ultimate return upon whether they went and got the vaccine. ¶6 Nothing in the Legislature's use of the phrase "attendance of" indicates an intent to target quarantine policies. Although section 1210.189(A)(1) prohibits school districts from requiring a COVID-19 vaccine "as a condition of admittance to or attendance of the school or institution," 70 O.S.2021, § 1210.189(A)(1) (emphasis added), that does not mean that school districts cannot prevent unvaccinated students from attending school after they've contracted or been exposed to COVID-19. Nor does it mean that school districts cannot impose on unvaccinated students a slightly longer period of quarantine. The majority opines that a student's vaccination status cannot be used to prevent attendance of any kind--not even for one day. I disagree. ¶7 The statute only concerns yearly enrollment and thus does not prohibit or otherwise implicate any policy governing short-term quarantines. Although I concede that "attendance" can be used to refer to the daily presence of a student in class, I would point out that "attendance" can also be used in a more generic sense to refer to the year-long presence of a student at the institution. The former meaning can be clearly perceived in section 1210.194, where "[a] child afflicted with a contagious disease or head lice may be prohibited from attending a public, private, or parochial school" on a daily basis "until such time as he is free from the contagious disease or head lice." 70 O.S.2021, § 1210.194(A) (emphasis added). The latter meaning comes to bear, however, in language added to section 1210.191 via the same bill that created section 1210.189 (i.e., Senate Bill 658), where "school attendance" is used interchangeably with "school enrollment." 70 O.S.2021, § 1210.191(E) (emphasis added). I conclude that section 1210.189 must be using "attendance" in the latter sense for two reasons. First, within the context of the legislative bill, we've already seen that the Legislature employed the term "attendance" in its amendment of section 1210.191(E) to mean "enrollment." Act of May 28, 2021, ch. 575, sec. 1, § 1210.191(E), 2021 Okla. Sess. Laws 4442, 4443. Thus, we know that's the meaning the Legislature had in mind when it used the same term again in section 1210.189(A)(1). Id. sec. 2, § 1210.189(A)(1), 2021 Okla. Sess. Laws at 4444. Second, if there was any doubt left, we could employ the canon of construction known by its Latin name noscitur a sociis--which roughly translates to "it is known by its associates"--to conclude that "attendance" means annual presence at the school. In section 1210.189(A)(1) and (2), the phrase "attendance of" is grouped together with "admittance to." As already seen in section 1210.191(A), admittance entails the process of enrollment and acceptance into a school for the coming year. Thus, "attendance of" is merely another way of saying "admittance to." Consequently, section 1210.189(A)(1)'s use of the term "attendance" does not indicate that school districts cannot use quarantine policies to prevent unvaccinated students from attending school for a short period of time. ¶8 Lastly, I disagree with the majority's statutory construction of section 1210.189(A)(1) because, even if I assume the statute prohibits certain types of quarantine policies, the District's quarantine policy did not prevent the children's "attendance" and thus did not run afoul of section 1210.189(A)(1). District argues that, because the statute does not define "attendance" (i.e., it neither limits "attendance" to physical, in-person presence in the classroom nor excludes virtual presence), Parents' children are able to "attend" school despite their status as unvaccinated such that section 1210.189(A)(1) is not violated. The majority wrongly rejects District's argument, relying solely on a dictionary that defines the verb "attend" as "to be present at; to go to." Majority Op. ¶ 17 & n.8 (citing an online version of the Merriam-Webster dictionary). As I read it, that definition cuts against the majority, because a student who virtually attends class is "present" for purposes of receiving instruction just the same as other students who are physically in the classroom. In fact, under the State Department of Education's governing regulations, the school can mark a student who virtually attends as "present" rather than absent in their attendance records. See Okla. Admin. Code § 210:35-21-2(a) (defining "[a]lternative instructional delivery systems" to include, as of August 2021, "distance learning plan[s]" and "virtual instruction"); id. § 210:35-21-2(c)(1)(C)(iii) (setting forth attendance policies for virtual instruction programs). Moreover, even if the children weren't "present" in any sense, whether physically or virtually, it appears the District's quarantine policy did not prevent children's attendance insofar as the trial court found that "[t]he District counted all P[arent]s' children as being in attendance for any day they quarantined as a result of being a close contact of a positive case of COVID-19." ROA p.000103, Order on Temporary Inj. ¶ 8, at 3. Consequently, nothing about the District's different treatment of vaccinated and unvaccinated children under the quarantine policy prevented Parents' children from being in "attendance," from receiving instruction, and from receiving credit for their presence and participation. Absent any policy preventing attendance at the school, there can be no violation of section 1210.189(A)(1). ¶9 For all these reasons, I respectfully dissent.

9671abe4-4021-41b9-bf5b-694560d3c778

MeGee v. El Patio

oklahoma

Oklahoma Supreme Court

MEGEE v. EL PATIO2023 OK 14Case Number: 119449Decided: 02/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. NANCY CAROL MEGEE, as Personal Representative of and on behalf of Estate of David Anthony MeGee, Plaintiff/Appellant, v. EL PATIO, LLC, an Oklahoma Limited Liability Company; and DYLAN SCOTT WELCH, an individual, Defendants/Appellees. ON APPEAL FROM THE DISTRICT COURT OF CUSTER COUNTY, STATE OF OKLAHOMA HONORABLE JILL C. WEEDON, DISTRICT JUDGE ¶0 Plaintiff/Appellant Nancy Carol MeGee, as Personal Representative of and on behalf of the Estate of David Anthony MeGee, brought a wrongful death action against Defendants/Appellees El Patio, LLC and Dylan Scott Welch. Personal Representative alleges that Welch and other employees of El Patio over-served alcoholic beverages to David Anthony MeGee and then bet him $200 to drive from Weatherford, Oklahoma, to Oklahoma City. MeGee died in a motor vehicle accident on his way to Oklahoma City. The trial court granted El Patio and Welch's motion to dismiss for failure to state a claim. Personal Representative appealed. We reaffirm our holding in Ohio Casualty Insurance Co. v. Todd, 1991 OK 54, 813 P.2d 508, that a voluntarily intoxicated adult does not have a cause of action against a commercial vendor for personal injuries or death resulting from his own intoxication. We also hold that, regardless of the sale of alcohol, an intoxicated adult who accepts a bet to drive a motor vehicle and is injured as a result of his own intoxication does not have a cause of action against the bettor. ORDER OF THE DISTRICT COURT IS AFFIRMED. Clayton B. Bruner, Weatherford, Oklahoma, for Plaintiff/Appellant. Richard M. Healy, Lytle Soulé & Felty, P.C., Oklahoma City, Oklahoma, for Defendants/Appellees. KANE, C.J.: ¶1 There are two issues on appeal. First, should dram shop liability be extended to create a cause of action for a voluntarily intoxicated adult patron who is injured or dies as a result of his own intoxication? We reaffirm our holding in Ohio Casualty Insurance Co. v. Todd, 1991 OK 54, 813 P.2d 508, that the commercial vendor is not liable to the voluntarily intoxicated adult patron who injures himself. Second, does a voluntarily intoxicated adult who accepts a bet to drive a motor vehicle and injures himself as a result of his own intoxication have a cause of action against the bettor? We recognize no such cause of action. FACTS AND PROCEDURAL HISTORY ¶2 David Anthony MeGee was killed in a motor vehicle accident on January 19, 2019. Prior to getting behind the wheel, MeGee had been drinking alcohol at the El Patio restaurant in Weatherford, Oklahoma. ¶3 On January 19, 2021, Plaintiff/Appellant Nancy Carol MeGee, as Personal Representative of and on behalf of the Estate of David Anthony MeGee, filed a wrongful death action against Defendants/Appellees El Patio, LLC and Dylan Scott Welch, an employee of El Patio. The petition alleges that Welch intentionally and negligently over-served MeGee resulting in his death.1 It is alleged that Welch and other El Patio employees served MeGee twelve beers and five shots of tequila over the course of seven hours and then allowed him to drive. The petition further alleges that several servers bet MeGee $200.00 that he would not meet them at a bar in Oklahoma City later that night. Welch and the servers knew MeGee was leaving El Patio to drive to Oklahoma City to collect on the bet. MeGee reached speeds of 97 mph on his way and collided with the rear end of a tractor-trailer on I-40 near El Reno, Oklahoma. He was ejected from the vehicle and pronounced dead at the scene. ¶4 El Patio and Welch filed a motion to dismiss for failure to state a claim upon which relief may be granted, pursuant to 12 O.S.2011, § 2012(B)(6). El Patio and Welch argued Oklahoma law is clear that a licensed vendor of alcohol is not liable for injuries sustained by an intoxicated adult as a result of his own voluntary consumption of alcohol and that "negligent betting" is not a cognizable theory of liability. Personal Representative responded that an exception to the current law on first-party dram shop liability should be made under the egregious facts of the case and that betting an intoxicated person to drive is actionable. The trial court granted El Patio and Welch's motion to dismiss by journal entry filed on March 22, 2021. Personal Representative appealed. This Court retained the appeal on its own motion. STANDARD OF REVIEW ¶5 A district court's dismissal of an action is reviewed de novo. See Kirby v. Jean's Plumbing Heat & Air, 2009 OK 65, ¶ 5, 222 P.3d 21, 23. The purpose of a motion to dismiss is to test the law that governs the claim, not the facts. Id. ¶ 5, at 24. A motion to dismiss for failure to state a claim upon which relief may be granted will not be sustained unless it appears without doubt that the plaintiff can prove no set of facts which would entitle the plaintiff to relief. Id. Thus, the Court must take as true all of the allegations in the challenged pleading together with all reasonable inferences that can be drawn from them. Id. Dismissal is appropriate only when there is no cognizable legal theory to support the claim or there are insufficient facts under a cognizable legal theory. Id. ANALYSIS ¶6 Personal Representative is advancing two theories of liability based on negligence--selling alcohol to a noticeably intoxicated adult and betting an intoxicated person to drive. The framework for determining whether she has stated a claim for negligence is the same for both. To maintain a cause of action for negligence, three elements must be established: (1) a duty owed by the defendant to protect the plaintiff from injury; (2) a failure to perform that duty; and (3) injuries to the plaintiff which are proximately caused by the defendant's failure to exercise the duty of care. Smith v. City of Stillwater, 2014 OK 42, ¶ 22, 328 P.3d 1192, 1200. I. Liability Based on Serving Alcoholic Beverages to a Noticeably Intoxicated Adult ¶7 The common law rule was that a liquor vendor is not civilly liable for injuries to a third party that are caused by the acts of an intoxicated patron. This Court first recognized dram shop liability in Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300. We said that commercial vendors have a duty, imposed by both statute2 and common law principles, "to exercise reasonable care in selling or furnishing liquor to persons who by previous intoxication may lack full capacity of self-control to operate a motor vehicle and who may subsequently injure a third party." Id. ¶ 18, at 304. Since Brigance, a third party injured by a drunk driver may state a cause of action against the commercial vendor that over-served the driver. ¶8 In Ohio Casualty v. Todd, we were asked to determine whether a Brigance action should be extended to a voluntarily intoxicated adult patron who injures himself. We held that a tavern has no liability to an intoxicated adult who voluntarily consumes alcoholic beverages in excess and is injured as a result of his own intoxication. See Ohio Cas., 1991 OK 54, ¶ 20, 813 P.2d at 512. In reaching this conclusion, we explained that the commercial vendor's statutory and common law duty not to serve intoxicated persons is to protect innocent third parties, not to protect the voluntarily intoxicated adult from injuring himself. ¶9 We began Ohio Casualty by recognizing the tavern owner's statutory3 duty not to serve alcoholic beverages to an intoxicated adult and then examined whether violation of the statute amounted to negligence per se. See id. ¶¶ 9-11, at 510. The Court explained that the following elements must be established before the violation of a statute is negligence per se: (1) the injury must have been caused by the violation; (2) the injury must be of a type intended to be prevented by the statute; and (3) the injured party must be a member of the class intended to be protected by the statute. Id. ¶ 9, at 510. This Court found that the intoxicated driver was not a member of the class the statute was intended to protect. Id. ¶¶ 10-11, at 510. The Court reiterated what it said in Brigance: "[T]he purpose behind Section 537(A)(2) was to protect innocent third parties who were injured by intoxicated persons." Id. ¶ 10, at 510. We concluded: We find nothing in Section 537(A)(2), or in any of the statutes regulating the sale of alcohol, which indicate that the legislature intended to protect the intoxicated adult who, by his own actions, causes injury to himself. Instead, it appears that the legislature intended to protect the "unsuspecting public" - in effect all of the populace except the willing imbiber. Thus, a violation of Section 537(A)(2) does not amount to negligence per se under the facts of this case. Id. ¶ 11, at 510 (citations omitted).4 The Court also found Article 28, § 5 of the Oklahoma Constitution5 did not create a civil remedy in tort for the voluntarily intoxicated adult against the tavern owner. See id. n. 1, at 510. ¶10 The Court then turned to whether the tavern owner has a common law duty to an intoxicated adult patron who injures himself. Id. ¶¶ 12-19, at 510-12. We found no such common law duty. The Court discussed the concept of duty and liability as matters of public policy "subject to the changing attitudes and needs of society." Id. ¶ 13, at 511 (citing Brigance, 1986 OK 41, ¶ 12, 725 P.2d at 303). When Ohio Casualty was decided in 1991, the Court identified no public policy that demanded the extension of dram shop liability to the voluntarily intoxicated adult. Id. ¶ 18, at 512. Rather, societal considerations aimed at deterring drunk driving called for personal accountability: Here, the question is simply whether the intoxicated adult must bear the responsibility for his own injury which occurred due to his voluntary consumption of an excessive amount of alcohol. In the absence of harm to a third party, the act of serving an alcoholic beverage to an intoxicated adult customer and allowing the customer to exit the establishment does not constitute a breach of duty which is actionable in common law negligence. The public policy of protecting the innocent from the intoxicated would not be furthered by such an extension of Brigance. This holding does not ignore the conduct of the tavern owner, as the opinion concurring in part and dissenting in part fears. If a third party is injured, the rule of Brigance provides a cause of action against the tavern owner as well as the driver. Furthermore, the tavern owner who disregards the condition of his customers does so at the risk of criminal prosecution as well as forfeiture of his liquor license. Id. ¶ 19, at 512 (emphasis added). ¶11 This appeal presents the same question addressed in Ohio Casualty. We decline Personal Representative's invitation to deviate from our holding in Ohio Casualty. Rather, we reaffirm this Court's precedent. A voluntarily intoxicated adult patron who is injured as a result of his own intoxication cannot maintain a civil action against the commercial vendor.6 Like the Court in Ohio Casualty, we are cognizant that when a court creates a cause of action based on public policy, as we did in Brigance, it "has a burden to responsibly chart the boundaries beyond which the new cause of action does not serve the public, and should not be the law." Id. ¶ 18, at 512. Attitudes about drinking and driving and the needs of society have not changed over the last 32 years in such a way that dram shop liability should be extended to the voluntarily intoxicated adult. To the contrary, we heed to the Ohio Casualty Court's warning that if we "were to create a cause of action against the tavern owner, the inebriate could be rewarded for his own immoderation. Such was not the intent of Brigance, nor will we allow such a reward." Id. ¶ 15, at 511. II. Liability Based on Betting an Intoxicated Adult to Drive ¶12 Personal Representative presses a second theory of liability based on allegations that El Patio employees bet or incentivized MeGee to drive to Oklahoma City in an intoxicated state. Personal Representative asserts that MeGee was financially destitute and "$200.00 was an immense amount of money" to him. She emphasizes that the negligent betting theory of liability is separate from dram shop liability. Her negligent betting claim does not rely on MeGee being over-served at El Patio. Rather, she contends there is a common law duty not to bet a drunk person to drive. ¶13 As always, we begin with the existence of a duty. Whether a duty exists is a question of law. See Smith, 2014 OK 42, ¶ 22, 328 P.3d at 1200. If the defendant does not have a duty to protect the plaintiff from injury, there can be no set of facts available to create liability for negligence as a matter of law. See id. While negligent betting and over-serving are separate theories of liability, the duty inquiry is the same: Did the El Patio employees have a duty to protect MeGee from injuring himself?7 ¶14 Again, our analysis hinges on to whom the duty is owed, i.e., whether there is a duty to protect the plaintiff from injury. There may be a duty not to bet an intoxicated person to drive, but that duty is owed to innocent third parties, not the voluntarily intoxicated adult. MeGee was not an innocent third party. Rather, he was a voluntarily intoxicated adult who drove a motor vehicle and, tragically, died as a result of his own intoxication. El Patio employees may have had a duty not to bet MeGee to drive to protect third parties from injuries caused by MeGee, but they did not have a duty to protect MeGee from injuring himself. ¶15 We hold that a voluntarily intoxicated adult who accepts a bet to drive a motor vehicle and is injured or dies as a result of his own intoxication does not have a cause of action against the bettor. A voluntarily intoxicated adult is responsible for his condition and must be accountable for his own injuries. Allowing an intoxicated adult to be rewarded for his decision to drive does not deter drunk driving or further the public policy of protecting the innocent from the intoxicated. Echoing what this Court said in Ohio Casualty, in the absence of harm to a third party, betting an intoxicated adult to drive does not constitute a breach of duty actionable in common law negligence. Our holding does not ignore the conduct of the bettor. If a third party is injured, there may be a cause of action against the bettor as well as the driver. ¶16 We do not recognize a common law duty to protect a voluntarily intoxicated adult from injuring himself.8 The facts alleged are egregious, but, without the existence of a duty, Personal Representative has failed to state a claim upon which relief may be granted. No cognizable legal theory supports Personal Representative's claims. The trial court properly dismissed the lawsuit. CONCLUSION ¶17 It remains the law in Oklahoma that a voluntarily intoxicated adult who is injured as a result of his own intoxication does not have a cause of action against the commercial vendor that over-served him. A voluntarily intoxicated adult who accepts a bet to drive a motor vehicle and is injured or dies as a result of his own intoxication does not have a cause of action against the bettor. ORDER OF THE DISTRICT COURT IS AFFIRMED. CONCUR: Kane, C.J., Rowe, V.C.J. (by separate writing), Winchester and Kuehn, JJ. and Mitchell, S.J. DISSENT: Kauger, Edmondson, Gurich (by separate writing) and Darby (by separate writing), JJ. DISQUALIFIED: Combs, J. FOOTNOTES 1 Welch pleaded guilty to a misdemeanor for knowingly selling alcohol to an intoxicated person, in violation of 37A O.S.Supp.2018, § 6-121, on February 18, 2020. See State v. Welch, No. CM-2019-00333, Custer Cty. Dist. Ct. 2 See 37 O.S.Supp.1985, § 537. 3 See 37 O.S.Supp.1985, § 537(A)(2); see also 37 O.S.Supp.1985, § 538(G) (criminal penalty). 4 At the time Brigance and Ohio Casualty were decided, 37 O.S., § 537(A)(2) provided: "No person shall . . . [s]ell, deliver or knowingly furnish alcoholic beverages to an intoxicated person or to any person who has been adjudged insane or mentally deficient . . . ." 37 O.S.Supp.1985, § 537(A)(2); see also 37 O.S.Supp.1985, § 538(G) (criminal penalty). Title 37 was later repealed by 2016 Okla. Sess. Laws, SB 383, c. 366, § 169 (eff. October 1, 2018), and replaced with Title 37A, which provides, in pertinent part: Any person who shall knowingly sell, furnish or give alcoholic beverage to an insane, mentally deficient or intoxicated person shall be guilty of a misdemeanor for a first violation, and upon conviction shall be fined not more than Five Hundred Dollars ($500.00), or imprisoned in the county jail for not more than one (1) year, or by both such fine and imprisonment. 37A O.S.Supp.2018, § 6-121. 5 Article 28, § 5 of the Oklahoma Constitution provided: "It shall be unlawful for any licensee to sell or furnish any alcoholic beverage to . . . [a] person who is intoxicated." Article 28 of the Oklahoma Constitution was repealed by Legislative Referendum 370, State Question 792, adopted at election held November 8, 2016. However, it was replaced with the same language in Article 28A, § 5: "It shall be unlawful for any licensee to sell or furnish any alcoholic beverage to . . . [a] person who is intoxicated." 6 A minor who voluntarily drinks to the point of intoxication and is injured as a result of his own intoxication may have a cause of action against a commercial vendor. See Busby v. Quail Creek Golf & Country Club, 1994 OK 63, ¶ 12, 885 P.2d 1326, 1331-32. 7 Personal Representative does not contend a statutory duty exists, as there is no law prohibiting individuals from betting intoxicated persons to drive. 8 We leave open the question of whether there is a common law duty not to bet an intoxicated minor to drive to protect the intoxicated minor from injuring himself. ROWE, V.C.J., concurring: ¶1 I concur in the Court's judgment, affirming our decision in Ohio Casualty Insurance Co. v. Todd, 1991 OK 54, 813 P.2d 508, that a commercial vendor is not liable to the voluntarily intoxicated adult patron who injures himself. I write separately to highlight my concern with the Court's creation of civil liability in Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300. ¶2 The disregard for the life of the victim in this case rises to a level of inhumanity that shocks the conscience of the Court. Cases such as these tempt us to right a wrong and impose liability where none existed before. Yet, as callous as the actions of the employees were, we should not deviate from our principles of judicial restraint to expand civil liability to an area not heretofore recognized by the common law or statutory mandate.1 ¶3 At Oklahoma's statehood, the Legislature banned liquor and created a statutory dram shop cause of action.2 However, in 1959 the dram shop cause of action was repealed by the Alcohol Beverage Control Act3 and was never reenacted. As a result, the common law rule stood that a tavern owner who furnished alcoholic beverages to another was not civilly liable for a third person's injuries caused by the acts of an intoxicated patron. ¶4 Twenty-seven years later in Brigance, we held that in the interest of public policy, we should reject the common law doctrine of nonliability for tavern owners. In so holding, we created a civil cause of action for injured third parties against commercial vendors who furnish alcoholic beverages to a noticeably intoxicated person that causes an injury. To date, the civil liability created by Brigance has yet to be codified by the Legislature despite numerous cases applying such liability. 4 ¶5 Absent statutory authority, it is not the job of the Court to impose civil liability where none existed before--such responsibility rests with the Legislature. "The Oklahoma Legislature, not this Court or Congress, is primarily vested with the responsibility to declare the public policy of this state." Griffin v. Mullinix, 1997 OK 120, ¶ 18, 947 P.2d 177, 179. See City of Bethany v. Pub. Emps. Rels. Bd. of State of Okla., 1995 OK 99, ¶27, 904 P.2d 604, 612 ("In the absence of specific guidance in the Oklahoma Constitution, it is the Legislature, and not this Court, which is vested with responsibility for declaring the public policy of this state"). ¶6 Although it is tempting to impose liability when the facts underlying this tragedy are so appalling, our decision today correctly recognizes that determining whether liability should be imposed is not vested in our branch of government. FOOTNOTES 1 "The principle of judicial restraint includes recognition of the inability and undesirability of the judiciary substituting its notions of correct policy for that of a popularly elected legislature." Gladstone v. Bartlesville Indep. Sch. Dist. No. 30 (I-30), 2003 OK 30, 66 P.3d 442, 451, n.53 (citing Ferguson v. Skrupa, 371 U.S. 726, 731-32 (1963)). 2 1908 Okla. Sess. Laws 610. Section 21, in pertinent part, provides: "Every wife, child, parent, guardian, employer, or other person who shall be injured in person or property, or means of support by any intoxicated person or in consequence of intoxication of any person, shall have a right of action for all damages actually sustained, in his or her own name against any person, individual or corporate, who shall, by selling, bartering, giving away, or otherwise furnishing intoxicating liquors, contrary to the provisions of this Act have caused the intoxication of such person." 1908, ch. 69, art III § 21. 3 1959 Okla. Sess. Laws 141, repealing 37 O.S.1951 § 121. 4 In Brigance v. Velvet Dove Restaurant, Inc., then Chief Justice Simms (joined by Vice Chief Justice Doolin and Justice Opala) noted that the Court's holding did not extend "to benefit a consumer driver's claim against the vendor." Brigance, 1986 OK 42, ¶ 1, 725 P.2d at 306 (Simms, C.J., concurring). Gurich, J., with whom Kauger, Edmondson, and Darby, JJ., join, dissenting: ¶1 The majority concludes that the mother of a driver of a one-car accident, who died after being overserved and encouraged to consume alcohol by the employees of El Patio Restaurant in Weatherford, Oklahoma, has no cause of action. I dissent from the majority opinion because neither the Oklahoma Constitution nor a state statute limits the liability of a person who sells or furnishes alcohol to an intoxicated person solely to injuries suffered by third-parties. Both the State Constitution and our statutes impose a broad duty to refrain from selling or furnishing alcohol to an intoxicated person. Thus, I would find our pronouncement in Ohio Casualty Insurance Co. v Todd, 1991 OK 54, 813 P.2d 508, has no basis in law and should be overruled. ¶2 Article 28A, § 5 of the Oklahoma Constitution provides as follows: Sales prohibited to certain persons--Penalties A. It shall be unlawful for any licensee to sell or furnish any alcoholic beverage to: 1. A person under the age of twenty-one (21) years of age; 2. A person who has been adjudged insane or mentally deficient; or 3. A person who is intoxicated. B. It shall be unlawful for any person under the age of twenty-one (21) years to misrepresent his or her age, for the purpose of obtaining the purchase of any alcoholic beverage. C. The Legislature shall, by law, provide penalties for violations of the provisions of this section.1 Oklahoma statutes also speak to the issue of serving a person who is intoxicated. Title 37A has multiple sections that prohibit a person from selling or furnishing an alcoholic beverage to a person under the age of 21 or a person who is intoxicated. For example, 37A O.S.2021, §6-101 provides in part: A. No person shall: 1. Knowingly sell, deliver or furnish alcoholic beverages to any person under twenty-one (21) years of age; 2. Sell, deliver or knowingly furnish alcoholic beverages to an intoxicated person or to any person who has been adjudged insane or mentally deficient; 7A §6-101(A) (1), (2); Title 37A O.S. 2021 §6-101(C). ¶3 Neither the Constitution nor the above-referenced statutory section specify who they are designed to protect -- i.e., the general public or the person being served. Instead, both create a legal duty for the seller of alcohol to refrain from selling/furnishing alcohol to an intoxicated individual. In Ohio Cas. Ins. Co. v Todd, 1991 OK 54, 813 P.2d 508, this court answered a certified question from a federal court, concluding that a driver in a one-car accident who consumed alcohol by being served in a tavern was barred from bringing a civil action for his own injuries and damages. I believe this conclusion is directly contrary to the express duty created by the State Constitution. This was articulated by Justice Alma Wilson in her dissenting opinion: A plain reading of this constitutional provision is that persons under the age of twenty-one years, persons adjudged mentally incompetent and persons intoxicated are to be protected by the liquor licensee. That is, the liquor licensee had a duty not to sell or furnish alcoholic beverages to persons in those three specified groups of persons. Id. ¶ 3, 813 P.2d at 525. I agree with Justice Wilson, that "[a] reasonable intent to be gleaned from Article 28, § 5 is the protection of minor persons and adjudged mentally deficient persons and intoxicated persons." Id. ¶ 6, 813 P.2d at 525. The same logic applies to the above-referenced statutory section. ¶4 The majority uses the term "voluntary consumption" to negate the cause of action based on the overserving of a noticeably intoxicated person. It is as if this Court is applying the concept of contributory negligence, not comparative negligence.2 The negligence of the one consuming alcohol should be compared to the negligence of the seller/server. ¶5 There are several material issues that should be resolved by the fact finder, such as whether or not the overconsumption by the decedent was voluntary; whether the decedent was noticeably intoxicated; and whether the establishment continued to serve the decedent after he was noticeably intoxicated. Further, the actions of a server who sells or furnishes alcohol to a noticeably intoxicated person should be imputed to the establishment if the restaurant manager or supervisor had knowledge, encouraged the behavior, or failed to supervise, under a theory of respondeat superior. Fox v. Mize, 2018 OK 75, 428 P.3d 314,¶ 8. El Patio is in the business of selling alcohol, so it only makes sense that increasing sales of liquor will increase profits. Tips for servers/bartenders also increase as a customer's tab increases. ¶8 Under the facts of this case, the decedent was served seventeen alcoholic beverages by four different servers over seven hours. Eventually, employees of El Patio bet decedent $200.00 he could not drive from the restaurant location in Weatherford, Oklahoma, to a bar in Oklahoma City by a designated time. There are many reasons to reconsider our prior authority.3 Drunk drivers are a constant threat to the law-abiding users of our roads and highways. Encouraging noticeably intoxicated persons to drive by sellers of alcohol should be actionable. The trial court's order should be reversed, vacated and remanded to allow the case to proceed. FOOTNOTES 1 Added by Laws 2015, SJR 68, Section 1, State Question 792, Legislative Referendum 370, adopted at election held November 8, 2016. Article 28, § 5 was originally adopted in 1984 and repealed and replaced at the same time the voters adopted Article 28A § 5. 2 23 O.S.2021, §§ 13-14. 3 Even the defendants in this case, represented by the same counsel, ask the court to make a prospective ruling, should this court reconsider the Ohio Casualty case. DARBY, J., with whom Kauger, Edmondson, and Gurich, JJ., join dissenting: ¶1 Plaintiff alleges that the employees of Defendant served David Anthony Megee alcohol while Mr. Megee was obviously intoxicated, a crime, to which one employee has already entered a guilty plea and received a one-year sentence. One or more employees either bet $200.00, or agreed to pay Mr. Megee $200.00, if he would drive to meet them later that night in a bar approximately 70 miles away. The allegations are that Mr. Megee stumbled out of El Patio, got into his car, drove into the back of a tractor trailer, was ejected from his vehicle, was run over by a separate vehicle, and as a result Mr. Megee is dead, leaving behind a grieving family. When Plaintiff brought the cause of action, the trial court followed the existing law in Oklahoma as expressed in Ohio Casualty Insurance Company v. Todd, 1991 OK 54, 813 P.2d 508, and dismissed for failure to state a claim. ¶2 Before the Court decided Ohio Casualty, in Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300, we held that in the interest of public policy and other compelling reasons we should reject the common law doctrine of tavern owner nonliability in Oklahoma. We created a civil cause of action in instances where the commercial vendor sells or furnishes intoxicating beverages to an intoxicated customer thereby creating an unreasonable risk of harm to others who may be injured by the intoxicated driver's impaired ability to drive safely. In response, the Oklahoma Legislature took no action to codify or repeal "dramshop" liability. ¶3 Then, in 1991, this Court answered a certified question from the U.S. District Court for the Western District and held that "the tavern owner has no liability to the intoxicated adult who voluntarily consumes alcoholic beverages to excess and sustains injuries as a result of his intoxication." Ohio Casualty, 1991 OK 54, ¶ 20, 813 P.2d, at 512. In response, the Oklahoma Legislature has still taken no action to define the limits of potential dramshop liability in the intervening 31 years. ¶4 And now, the Court has the question of whether under any circumstances a licencee may be liable for injuries or death suffered by the intoxicated driver. We decided Velvet Dove and Ohio Casualty largely under the light of public policy. The reasoning so far has been that injured third parties are innocent and may recover, but the voluntarily intoxicated driver is not innocent and may not recover. In other words, it is the solitary fault of the intoxicated customer to drink to excess and drive and the tavern and its employees have no concern for their potential liability in their role in the death or injury to the customer. But, "a third party who was injured in an intoxicated driver's auto accident may . . . state a cause of action against the restaurant that served liquor to the driver." Ohio Casualty, 1991 OK 54, ¶ 6, 813 P.2d, at 509. ¶5 In Ohio Casualty this Court refused to extend potential liability for serving alcohol to an intoxicated customer and held that: In the absence of harm to a third party, the act of serving an alcoholic beverage to an intoxicated adult customer and allowing the customer to exit the establishment does not constitute a breach of duty which is actionable in common law negligence. Ohio Casualty, 1991 OK 54, ¶ 19, 813 P.2d, at 512. In other words, if a single car accident occurs, the over-served intoxicated driver does not have a cause of action against the business entity that over-served him. ¶6 The brief statement regarding the claims in Ohio Casualty do not include an allegation that the servers also contributed to the person's decision to drive by offering a monetary payoff. I doubt research will produce a case anywhere in the United States with a similar fact pattern. Mr. Megee accepted the challenge--but lost the bet and his life. And under the existing law in Oklahoma, Mr. Megee and his surviving family are literally out of luck. ¶7 I agree that in most circumstances the existing case law expressed in Ohio Casualty should be followed. I disagree, however, with the decision to prevent Plaintiff from pursuing this cause of action1 which alleges near unbelievable facts which demonstrate reckless conduct by Defendants in total disregard of Mr. Megee's life and the life of third parties. ¶8 The Oklahoma Legislature has not addressed the question of whether a cause of action lies against a licensee for injuries resulting from its employees serving alcohol to an intoxicated person. Regarding public policy, our goal as a decent citizenry is to prevent or at least reduce drunk driving because people every day are injured or killed as a result. If Oklahoma businesses know they may be held liable if the over-served drunk driver may also have a cause of action if injured or killed, what would change? The tavern would most certainly be more attentive to the problems associated with serving intoxicated patrons, would serve fewer intoxicated persons, and fewer drunk drivers would crash and be injured or killed--plus, fewer innocent third parties who are somebody's grandchild, spouse, or friend would be injured or killed. ¶9 To not protect the intoxicated driver from harm by allowing for potential liability upon the tavern cheapens that person's life. To just say it was their choice, they should suffer the consequences alone, don't burden the tavern with looking out for their safety is, in my opinion, off the mark. ¶10 Serving intoxicated patrons is a crime in Oklahoma, and prosecution for that crime is not dependent upon a resulting death or injury to anybody. Why then is the tavern's civil liability dependent upon who gets hurt as a result of their wrongdoing? Possibly that is what the people of Oklahoma want; maybe not. The answer is not an easy one. The Oklahoma Legislature may want to set the parameters of the tavern's liability. Personally, I find former Justice Opala's suggestions to be the most logical and legally sound. While I join in the court's refusal today to disturb this principle to benefit the uncoerced sui juris consumer, I would extend Brigance to allow actionable claims for only three narrowly defined classes of intoxicated consumer--all comprised of persons clearly unable to exercise free will: (1) those sui juris claimants whose will was overborne by duress, coercion or other wilful or grossly reckless misconduct, (2) those who were induced into imbibing by false misrepresentations that the potion was nonalcoholic or harmless and (3) those under legal disability--minors and mentally disabled--i.e., persons whose will the law recognizes as impaired by definition. Ohio Casualty, 1991 OK 54, ¶ 4, 813 P.2d, 514 (Opala, C.J, concurring). ¶11 I respectfully dissent. I would remand with instructions to vacate the order sustaining the motion to dismiss. FOOTNOTES 1 Motions to dismiss are generally viewed with disfavor. The purpose of a motion to dismiss is to test the law that governs the claim in litigation, not the underlying facts. A motion to dismiss for failure to state a claim upon which relief may be granted will not be sustained unless it should appear without doubt that the plaintiff can prove no set of facts in support of the claim for relief. When considering a defendant's quest for dismissal, the court must take as true all of the challenged pleading's allegations together with all reasonable inferences that may be drawn from them. A plaintiff is required neither to identify a specific theory of recovery nor to set out the correct remedy or relief to which he may be entitled. If relief is possible under any set of facts which can be established and is consistent with the allegations, a motion to dismiss should be denied. A petition can generally be dismissed only for lack of any cognizable legal theory to support the claim or for insufficient facts under a cognizable legal theory.

c9ebd94a-4fd8-48c2-9a7b-7ba65b52b324

Okla. Gas & Electric Co. v. State ex rel. Okla. Corp. Comm'n

oklahoma

Oklahoma Supreme Court

OKLA. GAS AND ELECTRIC CO. v. STATE ex rel. OKLA. CORPORATION COMMISSION2023 OK 33Case Number: 117896Decided: 04/03/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. OKLAHOMA GAS AND ELECTRIC COMPANY and ONEOK ARBUCKLE II PIPELINE, LLC, Appellants, v. STATE OF OKLAHOMA ex rel. OKLAHOMA CORPORATION COMMISSION, Appellee. APPEAL FROM OKLAHOMA CORPORATION COMMISSION CAUSE NO. PUD 201800075, ORDER NO. 692718 Dana L. Murphy, Chairman, and J. Todd Hiett, Vice Chairman. ¶0 In 2018, ONEOK Arbuckle II Pipeline, LLC began construction of a natural gas liquid pipeline to transport Oklahoma production to the interstate market. The pipeline required electricity to operate a series of pump stations, including the Binger II Pump Station. The location for the proposed Binger II was in the certified territory of CKenergy Electric Cooperative, Inc., which has exclusive rights to provide electricity in the area pursuant to the Retail Electric Supplier Certified Territory Act codified at 17 O.S. 2011, § 158.21 et seq. Relying on the large-load exception to the RESCTA, 17 O.S. 2011, § 158.25(E), OG&E submitted a bid to provide service to the Binger II, which ONEOK accepted, and the parties contracted for service. CKenergy appealed this contract to the Oklahoma Corporation Commission asserting that it was a violation of its exclusive rights under the RESCTA. The Commission subsequently enjoined OG&E's service, concluding that the meaning of "extending its service" in section 158.25(E) limits the manner or mechanism which OG&E may utilize to provide service under the large-load exception. OG&E and ONEOK appealed, we retained both appeals, and consolidated the cases. We hold that section 158.25(E) allows OG&E to extend its service to large loads in the manner proposed. Therefore, the Commission's order enjoining OG&E is vacated and remanded for proceedings consistent with this opinion. MATTER PREVIOUSLY RETAINED FOR DISPOSITION; ORDER OF THE OKLAHOMA CORPORATION COMMISSION ENJOINING OG&E IS VACATED; CAUSE REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION Clyde A. Muchmore and Melanie Wilson Rughani, Crowe & Dunlevy, PC, Oklahoma City, Oklahoma, for Appellant Oklahoma Gas and Electric Company. William L. Humes, Oklahoma Gas and Electric Company, Oklahoma City, Oklahoma, for Appellant Oklahoma Gas and Electric Company. David E. Keglovits, ONEOK Arbuckle II Pipeline, LLC, Tulsa, Oklahoma, for Appellant ONEOK Arbuckle II Pipeline, LLC. W.A. Drew Edmondson, Riggs, Abney, Neal, Turpen, Orbison, Lewis, Oklahoma City, Oklahoma, for Appellant ONEOK Arbuckle II Pipeline, LLC. Patricia L. Franz and Daniel P. Boyle, Oklahoma Corporation Commission, Oklahoma City, Oklahoma, for Appellee Oklahoma Corporation Commission. Brian W. Hobbs, Pain Garland and Hobbs, LLP, Anadarko, Oklahoma, for CKenergy Electric Cooperative, Inc. Deborah R. Thompson, OK Energy Firm, PLLC, Oklahoma City, Oklahoma, for Appellee CKenergy Electric Cooperative, Inc. Jana L. Knott, Bass Law, Oklahoma City, Oklahoma, for Appellee CKenergy Electric Cooperative, Inc. Adam J. Singer and J. Eric Turner, Derryberry & Naifeh, LLP, Oklahoma City, Oklahoma, for Oklahoma Association of Electric Cooperatives.1 Jon E. Brightmire and Tom Q. Ferguson, Doerner, Saunders, Daniel & Anderson, L.L.P., Tulsa, Oklahoma, for Amicus Curiae Public Service Company of Oklahoma. Jack P. Fite, White, Coffey & Fite, P.C., Oklahoma City, Oklahoma, for Amicus Curiae Public Service Company of Oklahoma. Joann S. Worthington, American Electric Power, Oklahoma City, Oklahoma, for Amicus Curiae Public Service Company of Oklahoma. Ash Mayfield, Grand River Dam Authority, Tulsa, Oklahoma, for Amicus Curiae Grand River Dam Authority. Brendon S. Atkinson, Atkinson Law Firm, PLLC, Enid, Oklahoma, for Amicus Curiae Oklahoma Agricultural Cooperative Council. H. Duane Riffe, Riffe & Associates, Tulsa, Oklahoma, for Amicus Curiae Oklahoma Rural Water Association. Clinton D. Whitworth, Whitworth, Wilson & Evans, PLLC, Edmond, Oklahoma, for Amicus Curiae Oklahoma State Union of the Farmers Educational and Co-operative Union of America, Inc. Ericka McPherson, Oklahoma Farm Bureau, Oklahoma City, Oklahoma, for Amicus Curiae Oklahoma Farm Bureau Legal Foundation. Gurich, J. ¶1 This retained appeal addresses the interpretation of the "large-load" or "one megawatt" exception to the Retail Electric Supplier Certified Territory Act (RESCTA). The RESCTA, codified at 17 O.S. 2011, § 158.21 et seq., divides Oklahoma's unincorporated areas into territories which are served by retail electric suppliers which maintain the "exclusive right to furnish retail electric service to all electric-consuming facilities located within its certified territory." 17 O.S. 2011, § 158.25(A). The RESCTA provides exceptions, however, that allow other retail electric suppliers to enter these certified territories in certain circumstances: The provisions of this act shall not preclude any retail electric supplier from extending its service after the effective date of this act (1) to its own property and facilities, in an unincorporated area, and (2) subject to Section 5 D, to an electric-consuming facility requiring electric service, in an unincorporated area, if the connected load for initial full operation of such electric-consuming facility is to be 1,000 kw or larger. 17 O.S. 2011, § 158.25(E). The latter exception is known as the "large-load" or "one megawatt" exception. The present matter concerns the meaning of "extending its service" as used in the large-load exception. Although undefined in the statute, "extending its service" does not specifically restrict a retail electric supplier from using open-access transmission lines to extend its service as Oklahoma Gas & Electric ("OG&E") proposes to do here. Facts & Procedural History ¶2 The underlying facts in this case are not in dispute. In 2018, ONEOK Arbuckle II Pipeline, LLC ("ONEOK") began building a 530-mile long pipeline to transport liquefied natural gas ("NGL") production from the South Central Oklahoma Oil Province and Sooner Trend Anadarko Canadian Kingfisher regions to Mont Belvieu, Texas. The purpose of the pipeline is to pump NGL through a series of electrically-powered pump stations, including the Binger II Pump Station ("Binger II") in Caddo County, Oklahoma. For purposes of the RESCTA, the Binger II is located in the certified territory of CKenergy Electric Cooperative, Inc. ("CKE").2 Generally, CKE has the exclusive right to furnish all retail electric service within its certified territory, unless an exception is applicable and allows other retail electric suppliers to service the load. 17 O.S.2011, § 158.25. ¶3 CKE is a rural electric cooperative and a retail electric supplier.3 CKE is not subject to the Commission's rate regulation, but is subject to the Commission for purposes of the RESCTA.4 OG&E is an investor owned electric public utility and a retail electric supplier.5 OG&E is wholly subject to the regulatory authority of the Commission.6 For the purpose of this case, ONEOK is a rural electric customer. The Binger II is an electric-consuming facility with a connected load greater than 1,000 kilowatts of electricity and meets the requirements for a large load as contemplated by 17 O.S.2011, § 158.25(E).7 Since the large load exception is applicable, the facility may be served by any retail supplier by extending its service. 17 O.S.2011, § 158.25(E). ¶4 Because the large load exception was applicable to the Binger II, ONEOK solicited bids from CKE and OG&E to furnish power to the Binger II. OG&E submitted a bid that was at least $5 million dollars below CKE's,8 so ONEOK awarded OG&E the contract for service on June 13, 2018. In order to fulfill the contract, OG&E proposed to use a third-party's transmission lines to provide service to the Binger II. OG&E planned to run a high-voltage line from Western Farmers Electric Cooperative's ("WFEC") transmission lines to a new substation--which OG&E would construct--and then run low-voltage distribution lines to the Binger II.9 OG&E intended to use this method because its own distribution lines were at least nine miles from the Binger II,10 whereas WFEC's transmission lines ran near the Binger II. On July 3, 2018, CKE petitioned the Oklahoma Corporation Commission ("Commission") for temporary and permanent injunctive relief to enjoin OG&E from utilizing WFEC's transmission lines to provide service to the Binger II. CKE also asked for a declaratory ruling determining that 17 O.S.2011, § 158.25(E) does not allow a retail electric supplier to extend its service into another supplier's certified territory directly from its own, or third-party, transmission facilities. ¶5 As CKE's request for relief adversely affected its operations, ONEOK intervened in the case on July 17, 2018. On August 22, 2018, OG&E moved the Commission to dismiss the case. While OG&E's motion to dismiss was pending, the Commission denied CKE's motion for temporary injunctive relief on September 18, 2018. Despite an administrative law judge's recommendation to grant the dismissal, the Commission ultimately denied OG&E's motion to dismiss on November 7, 2018. The Commission held a hearing on the merits of the case on November 14, 2018. On March 12, 2019, the two-member panel of the Commission issued its order, stating the following in part: IT IS FURTHER ORDERED that OG&E is enjoined from serving or furnishing retail electric service to the Pump Station directly from third-party transmission facilities in violation of the RESCTA. IT IS FURTHER ORDERED that the Commission declines the request to issue a declaratory ruling as requested by CKenergy.11 The Commission also made specific findings that though section 158.25(E) allows an electric retail supplier to "extend" its retail distribution systems, there is a limitation on the manner in which such extension of its services may occur.12 The Commission interpreted the phrase "extending its service" to mean the lengthening of a retail electric supplier's own retail distribution system.13 ¶6 In accordance with Article IX, Section 21 of the Oklahoma Constitution, the Commission granted a stay of the March 12, 2019, order until final disposition on appeal and set an appeal bond. ONEOK and OG&E both appealed the Commission's injunction to this Court, and we consolidated the appeals.14 Standard of Review ¶7 This Court is asked to review the Commission's order enjoining OG&E from the use of third-party transmission lines. The consolidated appeals of the Commission's decision involves the statutory interpretation of 17 O.S.2011, § 158.25(E) concerning the manner or mechanism in which OG&E proposes to service the Binger II. In order to review a decision of the Commission, we must be mindful of Article IX, § 20 of the Oklahoma Constitution: The Supreme Court's review of appealable orders of the Corporation Commission shall be judicial only, and in all appeals involving an asserted violation of any right of the parties under the Constitution of the United States or the Constitution of the State of Oklahoma, the Court shall exercise its own independent judgment as to both the law and the facts. In all other appeals from orders of the Corporation Commission the review by the Supreme Court shall not extend further than to determine whether the Commission has regularly pursued its authority, and whether the findings and conclusions of the Commission are sustained by the law and substantial evidence. Upon review, the Supreme Court shall enter judgment, either affirming or reversing the order of the Commission appealed from. Okla. Const. art. IX, § 20. "The trial court's conclusions on issues of law pertaining to the injunctive relief receive a non-deferential de novo appellate review." Western Heights Indep. Sch. Dist. No. I-41 of Okla. County v. State ex rel. Okla. Dep't of Educ., 2022 OK 79, ¶ 24, 518 P.3d 531, 542. Statutory interpretation presents an issue of law, so the Court's de novo review is appropriate. Med. Park Tel. Co. v. Okla. Corp. Comm'n, 2019 OK 21, ¶ 17, 441 P.3d 113, 118; see also Dobson Tel. Co. v. Okla. Corp. Comm'n, 2019 OK 27, ¶ 17, 441 P.3d 147, 152. In conducting its review, the Court has plenary, independent, and non-deferential authority to determine whether the trial tribunal erred in its legal rulings. Id. See also American Airlines, Inc. v. State ex rel. Okla. Tax Comm'n, 2014 OK 95, ¶ 25, 341 P.3d 56, 62--63. ¶8 Though the Commission may be given deference in certain circumstances, it is not appropriate here. Deference to the Commission is appropriate when the Commission is: (1) acting in its area of expertise15 or (2) applying a longstanding administrative construction of a statute.16 Statutory interpretation does not require the Commission's special expertise, therefore no deference is owed to the Commission on that account. Dobson Tel. Co. v. State ex rel. Okla. Corp. Comm'n, 2017 OK CIV APP 16, ¶ 15, 392 P.3d 295, 303 (approved for publ'n by Okla. Sup. Ct.) (holding that construction of the statute at issue was not within the expertise of the Commission. Rather it was "simply a matter of determining what a statute means, and that is within the expertise of the courts.").17 Further, the Commission's construction and application of 17 O.S.2011, § 158.25(E) is not longstanding and has not been uniformly applied. The Commission's construction of Section 158.25(E) is seen in this case for the first time18 and conflicts with the Commission's previous practices.19 Therefore, de novo review is appropriate. Analysis ¶9 In this case, the Commission held that "extending its service" as used in the large-load exception means that OG&E must physically extend their own distribution lines and may not utilize open-access transmission lines to provide service to the Binger II in CKE's certified territory. OG&E20 argues that "extending its service" is synonymous with furnishing service and that it should be entitled to use transmission lines to service the Binger II, just as it would in an incorporated territory. The respective sides base their arguments upon the RESCTA. ¶10 In 1971, the RESCTA was enacted to respond to the need for statewide access to reasonably affordable electric service. At the time, for-profit retail electric suppliers were serving more populated, profitable areas while leaving rural areas without adequate access to service.21 In other areas, where multiple retail electric suppliers served in close proximity, facilities were constructed across the road from each other, leading to wasteful duplication of facilities and encumbrance of the Oklahoma landscape.22 The RESCTA sought to rectify these issues by dividing the state into exclusive territories, granting a retail electric supplier exclusive rights to new electric service in those territories, and thus an incentive to provide service in those areas while limiting duplicative retail service facilities.23 The exclusive rights granted to the retail electric supplier by section 158.25 of the RESCTA is qualified, however, by exceptions enumerated in the statute including the "large-load" exception at issue here. ¶11 The Legislature enacted the RESCTA to achieve very specific goals, enumerating them succinctly as follows: It is hereby declared to be in the public interest that, in order to encourage the orderly development of coordinated statewide retail electric service, to avoid wasteful duplication of distribution facilities, to avoid unnecessary encumbering of the landscape of the State of Oklahoma, to prevent the waste of materials and natural resources, for the public convenience and necessity and to minimize disputes between retail electric suppliers which may result in inconvenience, diminished efficiency and higher costs in serving the consumer, the state be divided into geographical areas, establishing the unincorporated areas within which each retail electric supplier is to provide the retail electric service as provided in this act. 17 O.S. 2011, § 158.23. To effect this policy, the RESCTA created certified territories, stating: Except as otherwise provided herein, each retail electric supplier shall have the exclusive right to furnish retail electric service to all electric-consuming facilities located within its certified territory, and shall not furnish, make available, render or extend its retail electric service to a consumer for use in electric-consuming facilities located within the certified territory of another retail electric supplier; provided that any retail electric supplier may extend its facilities through the certified territory of another retail electric supplier, if such extension is necessary for such supplier to connect any of its facilities or to serve its consumers within its own certified territory. 17 O.S. 2011, § 158.25(A). There are exceptions to a provider's exclusive service in its certified territory. One such exception is commonly referred to as the "large load" or "one megawatt" exception. The large-load exception states: The provisions of this act shall not preclude any retail electric supplier from extending its service after the effective date of this act (1) to its own property and facilities, in an unincorporated area, and (2) subject to Section 5 D, to an electric-consuming facility requiring electric service, in an unincorporated area, if the connected load for initial full operation of such electric-consuming facility is to be 1,000 kw or larger. 17 O.S. 2011, § 158.25(E). ¶12 Since 1971, advances in technology, infrastructure, and federal regulation have provided widespread access to electric service and prompted a return to a competitive market.24 Established in 1977, the Federal Energy Regulatory Commission (FERC) is the independent agency that regulates the interstate electricity market.25 In 1996, the FERC, seeking to "remove impediments to competition" and "bring more efficient, lower cost power to the Nation's electricity consumers," issued Order No. 888, which required open-access trading in the wholesale transmission market.26 Prior to Order No. 888, it was common for retail electric suppliers to use third-party transmission lines, but it was done by specific agreement between the parties rather than by regulatory mandate.27 After Order No. 888, though, utility suppliers had to allow non-discriminatory access to transmission lines to unaffiliated utilities, enabling the utilities to use third-party transmission lines to transport electricity across the grid.28 ¶13 A year after the FERC issued Order No. 888, the Oklahoma Legislature enacted the Electric Restructuring Act of 1997. While the Restructuring Act recognized that "[m]onopoly utility regulation has been used as a substitute for competition in the supply of electricity," changes in the marketplace and technology as well as FERC Order No. 888 "have resulted in increased competition in the electric generation industry." 17 O.S. 2011, § 190.2. The Legislature launched a study and task force devoted to developing a framework for a restructured industry. 17 O.S. 2011, § 190.4; see also 17 O.S. 2011, § 190.21. Even though they launched this study, the Legislature did not adopt a restructuring plan, did not repeal the Restructuring Act, nor did it amend the language of the RESCTA to address the changes in the electric marketplace or technology. The Legislature stood silent as to the manner and method required for "extending its service" as utilized in 17 O.S. 2011, § 158.25(E). ¶14 The respective sides suggest competing interpretations of the phrase "extending its service" as used in the large-load exception. If a statute is subject to more than one interpretation, we look to the plain and ordinary meaning of words in a statute unless the Legislature defines the term. In the Matter of the Income Tax Protest of Hare, 2017 OK 60, ¶ 10, 398 P.3d 317, 320. We also look at the act as a whole, considering its general purpose to determine the legislative intent behind its enactment, and give the statute a reasonable and sensible construction that will avoid absurd consequences. McIntosh v. Watkins, 2019 OK 6, ¶ 4, 441 P.3d 1094, 1096. The plain meaning of "extending its service." ¶15 In construing the phrase "extending its service," we first look at the ordinary definition of the words used in the phrase. "Extend" has several meanings including: to spread or stretch forth; to proffer; to make available; or to advance. Merriam-Webster, https://www.merriam-webster.com/dictionary/extend (last visited Dec. 19, 2022). "Its" is defined as of or relating to it or itself. Merriam-Webster, https://www.merriam-webster.com/dictionary/its (last visited Dec. 19, 2022). "Service," in this context, means a facility supplying some public demand. Merriam-Webster, https://www.merriam-webster.com/dictionary/service (last visited Dec. 19, 2022). Extend is synonymous with furnish, make available, and render. ¶16 "A statute must be read to render every part operative and to avoid rendering parts thereof superfluous or useless." Am. Airlines, Inc. v. Okla. Tax Comm'n, 2014 OK 95, ¶ 41, 341 P.3d 56. Despite this rule limiting superfluous language, it is also common for a statute to utilize and string together synonyms to stave off arguments based on any perceived loopholes. United States v. Costello, 666 F.3d 1040, 1048 (7th Cir. 2012). ¶17 In its Order, the Commission based its definition of the word "extending" on the premise that if "extend" was interpreted to mean furnish or make available, other words in the RESCTA--"furnish," "make available," and "render"--would be superfluous.29 The Commission asserts that because each of these words is used in the statute, they must have differing meanings. Yet these words are synonymous with one another. This string of synonyms is used when prohibiting conduct, indicating an intent to avoid any omission. Whereas, only a single word is used when allowing conduct.30 As such, it would be inappropriate to imbue these synonymous words with distinct meaning and interpret the large-load exception in this manner. The definition of the phrase "extending its service" must be consistent with the intent of the RESCTA. ¶18 "Extending" requires consideration of the Legislative intent in enacting the RESCTA. In enacting the RESCTA, the Legislature specifically wanted to "avoid wasteful duplication of distribution facilities"; "avoid unnecessary encumbering of the landscape of the State of Oklahoma"; "prevent waste of materials and natural resources"; and "minimize disputes between retail electric suppliers which may result in inconvenience, diminished efficiency and higher costs in serving the consumer." 17 O.S. 2011, § 158.23. ¶19 OG&E proposed to utilize WFEC's transmission lines to provide retail electric service to the Binger II. It should be noted, CKE proposed to use the same WFEC transmission lines to provide retail electric service to the Binger II.31 The Commission's Administrative Law Judge stated in their Report and Recommendation that, even interconnecting with WFEC's transmission lines, Plainly, OG&E is offering its services to the Pump Station. Moreover, in constructing infrastructure to service ONEOK's Pump Station or otherwise availing itself of rights to open-access transmission specifically authorized by the Federal Energy Regulatory Commission ("FERC"), OG&E is making its service available to ONEOK. Likewise, in constructing infrastructure to service ONEOK's Pump Station, OG&E is causing its service and not that of a third party to reach ONEOK's point of electricity consumption.32 The Commission held, however, that OG&E could not utilize a third-party's transmission facilities to serve the Binger II.33 ¶20 On appeal, ONEOK and OG&E assert that the ALJ's conclusion was correct. We agree. The Commission's interpretation runs counter to the RESCTA's policies of reducing wasteful duplication of distribution facilities, encumbering the Oklahoma landscape, and wasting materials. First, if OG&E were compelled to run distribution lines from its nearest distribution facility, it would require the encumbrance of at least nine miles of Oklahoma landscape.34 Running such distribution lines would also be wasteful of materials and natural resources because there are existing open-access transmission lines which OG&E may utilize near the Binger II.35 The additional lines would also require a higher cost for the customer, ONEOK, as the favorable pricing that OG&E offered due to its use of a third-party's transmission lines would be negated.36 ¶21 The Commission asserts that allowing OG&E to have an "island" in CKE's certified territory would be a wasteful duplication of distribution facilities and it therefore violates the RESCTA.37 This is so because OG&E would have to build infrastructure to use WFEC's transmission lines to service the Binger II, whereas CKE has a previously-built substation already in place in the vicinity of the Binger II.38 While the proposed OG&E substation may be a duplication of distribution facilities, it is a question of whether the duplicate distribution facility would be wasteful. In order to be wasteful, the duplicate facility would have to be "given to or characterized by useless consumption or expenditure." Dictionary.com, https://www.dictionary.com/browse/wasteful (last accessed Dec. 19, 2022). Both OG&E and PSO, an amici in this case, assert that interconnecting with transmission lines to provide retail electric service to a substation is generally the manner in which large loads are serviced.39 Even CKE, which would be utilizing WFEC's transmission lines, would have to upgrade their current facilities in order to properly service the large load.40 Therefore, a facility would not be useless, nor would the expenditure of costs or materials, as each would be necessary regardless of the company awarded the contract. While it may be a duplication of facilities, it is not a wasteful duplication, and is therefore not a violation of the RESCTA. ¶22 An analogy may be of assistance here. OG&E is proposing to interconnect with open-access transmission lines that are federally regulated. From that interconnection, OG&E will then run its own distribution lines to a substation and the Binger II. We can liken this to a highway. If OG&E were building a road that led to the Binger II, we would not require them to build a new road if there is already a highway that was closer and more readily available. We would expect OG&E to use the existing highway and build an extension from there. The issue is no different here. The large-load exception must be given force and effect. ¶23 Cooperatives have exclusive rights in all other spaces, and must be available to service all loads in their territory, even undesirable or unprofitable loads.41 CKE and the amici argue that this requirement--providing service for all loads--is the public policy supporting a narrow construction of the large-load exception which would necessarily eliminate competition. By eliminating competition, rural cooperatives could recoup certain costs of doing business in the area by servicing these lucrative loads.42 Both the Commission and CKE seek to impose additional limitations on the large-load exception which is not found in the statute, arguing that it is only applicable at the "seams" or where another retail electric supplier is already in the area.43 ¶24 While the RESCTA established certified territories in order to service unincorporated areas, at the same time, the Legislature enacted the large-load exception. The large-load exception specifically states that the RESCTA does not preclude any retail electric supplier from extending its service to a large load. 17 O.S. 2011, § 158.25(E). The certified territories with the exception for large loads (which allows any retail electric supplier to service such loads) were part of the original Act in 1971 and has never been amended or revised. ¶25 On one hand, CKE contends that "the RESCTA was enacted specifically to ensure rural Oklahomans have access to affordable, reliable, and efficient electric service."44 On the other hand, CKE ignores the fact that ONEOK is a rural retail electric customer in this instance. CKE's bid was millions of dollars more than OG&E's. Interpreting the exception as CKE asserts would eliminate all competition, which arguably drives up costs for large customers in order to subsidize the cooperative's other electric consumers.45 ¶26 There is also nothing in the statute that supports the "seams" argument that CKE puts forward. The plain language of the statute provides that any retail electric supplier may provide service to large loads.46 Because the RESCTA grants exclusive rights to retail electric suppliers in unincorporated territories, it would be nearly impossible for another supplier to already be in the area. If this reading was enforced, it would render the large-load exception largely inoperable. Construing this language to mean only a retail electric supplier who operates at the "seams" of the territories or where a retail electric supplier is already in the area would be wholly contrary to the legislative intent and plain language of the exception. If the Legislature wanted to limit the manner and method of providing service under the large-load exception, they could have. ¶27 "We presume that the Legislature expressed its intent and intended what it expressed, and statutes are interpreted to attain that purpose and end, championing the broad public policy purposes underlying them." Estes v. ConocoPhillips Co., 2008 OK 21, ¶ 16, 184 P.3d 518, 525. "It is not the function of the courts to add new provisions which the legislature chose to withhold." Pentagon Acad., Inc. v. Ind. Sch. Dist. No. 1 of Tulsa County, 2003 OK 98, ¶19, 82 P.3d 587, 591. ¶28 The Commission and CKE rely on OG&E v. Kay Elec. Co-op, 1974 OK 24, 519 P.2d 905, due to the Court's differentiation between distribution and transmission lines.47 Kay Electric was decided before the Commission had prepared maps showing each supplier's certified territory. OG&E filed an action with the Commission seeking to service a new facility because OG&E had an existing 24 kilovolt line that was in closer proximity to the facility than Kay Electric's nearest existing 7.2KV line. OG&E asserted that the 24KV line met the definition of an "existing distribution line" as contemplated by 17 O.S. 2011, § 158.25(B), so that OG&E could provide retail service in the area. Id. ¶ 1, 519 P.2d at 906. In a prior proceeding, the Commission determined that a 24 KV (or above) line was presumed to be a transmission line and lines of lesser voltage would be presumed to be distribution lines. In order to fit the definition of a distribution line, OG&E relied on evidence that the 24KV line serviced 45 rural customers in addition to the non-rural retail customers. In the specific segment near the new facility, OG&E serviced three customers that took electricity directly from the 24 KV line. The Commission concluded that the disagreement as to the meaning of the term "substantial use" found in §158.22(3)(b) necessitated the establishment of standards to apply to seven specific situations.48 Applying the standards to this case, the Commission determined that part of the 24 KV line was a distribution line, whereas another part was a transmission line. Id. ¶ 11, 519 P.2d at 907. On appeal, OG&E argued that the Act makes no distinction between distribution and transmission lines but only between retail and wholesale electric service.49 However, our Court approved the standard applied and affirmed the Commission's determination in favor of Kay Electric. The Court cited a case from Minnesota, which described the difference between distribution and transmission lines.50 The Court concluded that when the Legislature utilized the term "distribution lines," "the legislature intended to recognize the common usage distinction between 'transmission' and 'distribution' lines" and approved the decision of the Commission which determined that one high voltage line could be used for both transmission and distribution, based on the purpose for which the line is used. Id. ¶ 19, 519 P.2d at 909. ¶29 Kay Electric is instructive because the Legislature, well versed on the distinction between transmission and distribution lines, chose not to make a distinction in the exception at issue as to the manner in which large loads may be serviced. Kay Electric also stands for the proposition that one line can be used for different purposes. ¶30 CKE asserts that OG&E's use of wholesale transmission lines excludes it from providing retail electric service.51 This assertion is incompatible with Kay Electric. Pursuant to Kay Electric, the type of line is determined based on the purpose for which the line is used. In this case, while the WFEC line is undisputedly an open-access transmission line delivering wholesale electric energy, there is no indication in the record that OG&E is purchasing electricity for wholesale to a third party. OG&E proposes to use the line only to deliver retail electric service to the Binger II.52 ¶31 The Commission also argues that the manner in which service may be extended is limited to use of the technology available at the time of the enactment of the RESCTA in 1971. To the extent technology existing at enactment could implicitly limit approved methods of extending service, the Legislature directed it should not: "This act shall be construed liberally. The enumeration of any object, purpose, power, manner, method or thing shall not be deemed to exclude like or similar objects, purposes, powers, manners, methods or things." 17 O.S. 2011, § 158.31. Open access to shared resources did not exist in 1971, so it would have been impossible for the enacting Legislature to bar its use in extending service under section 158.25(E). In 1997, however, the Legislature recognized the existence of open access resources,53 but still did not place any restrictions on the manner or method of providing service under the large load exception. Moreover, allowing access to shared resources furthers the common purposes of the RESCTA and the Electric Restructuring Act of 1997. Since 1997, the use of transmission lines and power-sharing markets have led to decreased duplication of facilities and lowered the cost of electric service to consumers.54 Retail electric suppliers have been utilizing transmission lines to provide service under the large load exception for years with the knowledge of the Commission.55 We therefore decline to impose such a restriction now. Conclusion ¶32 The Commission's interpretation of 17 O.S.2011, § 158.25(E) to prohibit OG&E from extending its retail electric service to the Binger II is in error. We hold that section 158.25(E) allows OG&E to extend its service to large loads in the manner proposed. The use of open-access transmission lines is not prohibited by the RESCTA. Therefore, we vacate the order of the Commission enjoining OG&E from serving or furnishing retail electric service to the Binger II directly from third-party transmission facilities. ORDER OF THE OKLAHOMA CORPORATION COMMISSION ENJOINING OG&E IS VACATED; CAUSE REMANDED FOR PROCEEDINGS CONSISTENT WITH THIS OPINION. Kauger, Winchester, Combs, Gurich and Kuehn, JJ., concur; Kane, C.J. (by separate writing), Rowe, V.C.J., Darby (by separate writing), J., dissent; Edmondson, J., disqualified. FOOTNOTES 1 Oklahoma Association of Electric Cooperatives ("OAEC") is an intervenor and has party status in case no. 117,896. 2 R. at 915. 3 R. at 588, 1009. 4 R. at 1009. 5 R. at 588, 1009. 6 R. at 1009. 7 R. at 1009. 8 There is a discrepancy as to the difference between OG&E and CKE's bids. ONEOK asserts that there was an $11 million difference in proposals, whereas OG&E states the difference was $5 million. 9 Distribution lines transport lower voltage electricity to neighborhoods and communities over a shorter distance while transmission lines transport bulk electricity at high voltages over vast distances. PG&E, Transmission v. distribution power lines, https://www.pge.com/en_US/safety/yard-safety/powerlines-and-trees/transmission-vs-distribution-power-lines.page (last visited Dec. 8, 2022). 10 Nine miles by following the most direct path and fourteen miles by following roadways. 11 R. at 1094. 12 R. at 1093. 13 R. at 1093. 14 OG&E filed its appeal in case no. 117,896 on April 10, 2019, and ONEOK filed its appeal in case no. 117,902 on April 11, 2019. We consolidated the appeals on April 29, 2019. 15 Cox Oklahoma Telecom, LLV v. State ex rel. Okla. Corp. Comm'n, 2007 OK 55, ¶ 9, 164 P.3d 150, 156 ("Because Commission decisions often involve complex issues of economics, accounting, engineering, and other special fields of knowledge, a presumption of correctness accompanies the Commission's findings in matters it frequently adjudicates and in which it possesses expertise."). 16 Oral Roberts Univ. v. Okla. Tax Comm'n, 1985 OK 97, 714 P.2d 1013 (holding that Commission's longstanding construction of a statute "must be given great weight."); Schulte Oil Co., Inc. v. Okla. Tax Comm'n, 1994 OK 103, ¶ 4, 882 P.2d 65, 68 (stating that because there was no support in the record for any "prior, firmly established Commission policy" (i.e. longstanding policy), the Court had to decide the case on other grounds). See Oral Roberts Univ. v. Okla. Tax Comm'n, 1985 OK 97, ¶ 9, 714 P.2d 1013, 1015. It is imperative that such interpretations be longstanding so that the Legislature has notice of the Commission's interpretation, allowing the Legislature to either act or remain silent on the issue. See R.R. Tway, Inc. v. Okla. Tax Comm'n, 1995 OK 129, ¶ 12 n.3, 910 P.2d 972, 976 n.3. If the Legislature knows of the longstanding administrative construction, but remains silent, "such silence may be regarded as acquiescence in or approval of the administrative construction." Oral Roberts, 1985 OK 97, ¶ 17, 714 P.2d at 1016. The Court shows deference to such a longstanding interpretation because "great interests have grown up under it and will be disturbed or destroyed by the announcement of a new rule." Id. ¶ 10, 714 P.2d at 1015 (citation omitted). 17 CKE and the Commission's reliance on Pub. Serv. Co. of Okla. v. State ex rel. Okla. Corp. Comm'n, 2005 OK 47, ¶ 8, 115 P.3d 861, 869, for the assertion that the Commission is owed deference is misguided. In Public Service Co., the Court gave deference to the Commission's factual findings, not its legal conclusions. The Court held that a deferential standard was appropriate for this decision "[b]ecause Commission decisions often involve complex issues of economics, accounting, engineering, and other special knowledge." Id. When reviewing the Commission's factual findings, "a presumption of correctness accompanies the Commission's findings in matters it frequently adjudicates and in which it possesses expertise." Id. Here, we are not reviewing the Commission's factual findings in which it possesses expertise, but rather its legal conclusions which are the expertise of the Court. Robinson v. Fairview Fellowship Home for Senior Citizens, Inc., 2016 OK 42, ¶ 13, 371 P.3d 477, 483 ("This Court is the ultimate authority on the interpretation of the laws of this state."); see also Dobson Tel. Co. v. State ex rel. Okla. Corp. Comm'n, 2017 OK CIV APP 16, ¶ 15, 392 P.3d 295, 303 (approved for publ'n by Okla. Sup. Crt.) ("This is simply a matter of determining what a statute means, and that is within the expertise of the courts."). 18 Parties from both sides of this issue have asserted that this is a case of first impression. R. at 300, CKE Mot. for Temporary Inj. ("The issue before the Commission in the Cause is one of great importance and one that has not been heard or resolved by the Commission to date, to the knowledge of CKenergy."); R. at 308, Okla. Assoc. of Elec. Coop's Mot. to Dismiss ("To the knowledge of counsel for OEAC, this is a case of first impression, and more importantly, the cause seeks to address unanswered issues arising from significant changes in industry practices, which in turn give rise to CKenergy's request for relief."); Appellant OG&E's Br. in Chief 8 ("the agency's interpretation has been adopted for the first time in the course of litigation. . . ."). 19 The record presents evidence that the Commission has previously allowed OG&E to provide service in certified territories via third-party transmission lines. R. at 533 ("I am aware that OG&E is serving 1,000 kW load in other Oklahoma rural electric cooperatives' certified territories by means other than by extending OG&E's service."), 1098--99 ("OG&E is currently providing (or is contracted to provide) service to nearly one dozen other customers in a similar manner under this exception; and not once has such an objection been raised."), 1102. See also Appellant OG&E's Br. in Chief 1, OG&E v. State ex rel. Okla. Corp. Comm'n, No. 118,857 (Okla. filed Nov. 16, 2020) ("OG&E and other suppliers have been tapping into nearby transmission lines and building dedicated substations to serve such loads for decades."). The Commission's rulings in at least two companion cases, numbers 119,054 and 119,083, also show that the Corporation Commission has allowed waiver of its perceived violations of the RESCTA. In those cases, the Commission found in favor of OG&E and allowed it to provide service through third-party transmission lines. 20 Both OG&E and ONG assert similar arguments in this case. For purposes of this opinion when "OG&E" is referenced going forward, it is referencing both OG&E and ONEOK unless otherwise noted. 21 See Amicus Curiae Okla. Farm Bureau Legal Found., et al. Br. 14 ("The RECA was a foundational moment in Oklahoma history because it allowed rural Oklahomans to provide for their own electrical needs in the vast stretches of rural Oklahoma where for-profit utilities, like OG&E, refused to serve because it could not make a profit for its investors. . . ."). 22 Appellee CKE Answer Br. 6. 23 Id. 24 See Appellant ONEOK Opening Br. 5. 25 Id. at 4. 26 Id. 27 Appellant OG&E Reply Br. 16. 28 Appellant ONEOK Opening Br. 4--5. 29 R. at 1093 ("THE COMMISSION FURTHER FINDS that interpreting 17 O.S. § 158.25(E) as proposed by OG&E and ONEOK would require an interpretation of the statute that 'extend its service' means the same thing as furnishing electricity, or simply providing or offering electricity, which would violate the rules of statutory construction because it would render other words in the statute useless."). 30 Compare 17 O.S. 2011, § 158.25(A) ("shall not furnish, make available, render or extend its retail electric service. . . ."); 17 O.S. 2011, § 158.25(D) ("no retail electric supplier shall furnish, make available, render or extend electric retail service. . . .") with 17 O.S. 2011, § 158.25(B) ("shall be furnished retail electric service . . ."); 17 O.S. 2011, § 158.25(E) ("The provisions of this act shall not preclude any retail electric supplier from extending its service. . . ."). 31 See R. at 100, 131, 1021. (CKE would serve the Binger II by running distribution lines from the substation located across the road from the Binger II. That substation is served by CKE's distribution lines which connect to WFEC's transmission lines). 32 R. at 920. 33 R. at 1093 ("THE COMMISSION FURTHER FINDS that OG&E does not intend to "extend" its retail distribution system to serve the Pump Station. Rather, OG&E intends to access third-party transmission facilities to serve the Pump Station. Therefore, the RESCTA prohibits OG&E from serving the Pump Station in the manner in which OG&E intends to serve."). 34 R. at 479--80. 35 R. at 480 (OG&E "has sought to add a new delivery point through the SPP so that it can connect to WFEC's transmission line and then build one mile of transmission line and substation. . . ."). 36 Appellant ONEOK Opening Br. 17. CKE challenged OG&E's favorable pricing by presenting testimony regarding OG&E's Allowable Expenditure Formula before the ALJ. R. at 926--38. In its brief, OAEC also challenged OG&E's pricing, stating: "Without regard to the complex economics or for-profit rate making, the simple and unavoidable fact is that the infrastructure to take electricity from a high voltage transmission line, step it down to retail levels, and deliver it to a single non-contiguously located customer is not cheap." OAEC's Resp. to Appellant's Br. in Chief 20. While OAEC may dispute the accuracy of OG&E's formula, it does not dispute that OG&E is a retail electric supplier seeking approval to supply retail electric service to the ONEOK facility. 37 See Appellee Comm'n Answer Br. 11. 38 See Appellee Comm'n Answer Br. 19. 39 R. at 468 ("PSO further mentioned that larger loads like the one at issue in this case are commonly served off of transmission lines."), 1098--99, 1102; Appellant OG&E's Br. in Chief 10. 40 R. at 489. 41 See Amicus Curiae Okla. Farm Bureau Legal Found., et al. Br. 15 42 R. at 483. 43 Appellee CKE Answer Br. 21; Appellee Comm'n Answer Br. 14. 44 Combined Ans. Br. of Appellee CKE 23. 45 ONEOK Arbuckle II Pipeline, LLC's Reply Br. 14--15. 46 17 O.S. 2011, § 158.25(E) states in pertinent part: "The provisions of this act shall not preclude any retail electric supplier from extending its service after the effective date of this act . . . subject to Section 5 D, to an electric-consuming facility requiring electric service, in an unincorporated area, if the connected load for initial full operation of such electric-consuming facility is to be 1,000 kw or larger." 47 When the RESCTA was enacted in 1971, the Commission was tasked with determining the boundaries of the certified territories. Each boundary was set with regard to existing distribution lines. 17 O.S. 2011, § 158.24(B).The Act required suppliers to file a map with the Commission showing existing distribution lines. The Commission was then required to prepare maps establishing unincorporated areas within which each supplier had the exclusive right to provide electric service. Kay Electric, 1974 OK 24, ¶ 3, 519 P.2d 905, 906--07. 48 The Legislature defined an existing distribution line as a line that "is located in an unincorporated area" and "is being or has been substantially used for retail electric service." 17 O.S. 2011, § 158.22(3). For new electric-consuming facilities in unincorporated territories which had not yet been included within a certified territory, the retail electric supplier with the closest existing distribution line would provide service. 17 O.S.2011, § 158.25(B). 49 Under the Act, retail electric service is defined as "electric service furnished to a consumer for ultimate consumption, but does not include wholesale electric energy furnished by an electric supplier to another electric supplier for resale." 17 O.S. 2011, § 158.22(4). 50 Kay Electric specifically states: In determining what the legislature meant by * * * the terms `distribution line' and `transmission line' * * * we are guided by § 645.08(1) which provides that, in construing statutes, words and phrases are to be understood according to their common and approved usage. * * * The state Tax Commission construes transmission lines to be those which take the current from the point of delivery * * * and deliver it in bulk to a point or points for distribution. The interpretation * * * seems to be in accord with the common usage of the terms. * * * The dictionary definitions of the two terms are in accord with the notion that transmission lines are those that transfer current from one place to another but do not divide or apportion it among the consumers, while the distribution lines are engaged only in the latter function. * * * The distinction between the terms * * * lies in the primary objective and purpose for which the line is used. It is apparent that the primary objective and purpose of the 22,000-volt line in question is the transfer of large quantities of electrical energy in bulk to locations from which it may be distributed or allocated to consumers by means of other lines. 1974 OK 24, ¶ 18, 519 P.2d 905, 909 (citation omitted). 51 Combined Ans. Br. of Appellee CKE 23. 52 Supra note 36. The dissent relies on the testimony of CKE's expert, David W. Hedrick, who challenged the Allowable Expenditure Formula used to calculate the cost of OG&E providing service to ONEOK's new load. There is no dispute that OG&E would pay a "tap fee" for the use of WFEC's transmission line. This testimony addressed why OG&E's bid was millions of dollars lower than CKE's bid. However, CKE's expert admitted "A thorough review and analysis of the assumption and cost of service methodology is beyond the scope of this proceeding, but the concerns are legitimate and should be reviewed by the OCC." R. at 938. 53 17 O.S.2011, § 190.2 states: Monopoly utility regulation has been used as a substitute for competition in the supply of electricity, but recent changes in the energy marketplace and technology as well as the passage of the National Energy Policy Act of 1992 and implementation of Order No. 888 by the Federal Energy Regulatory Commission have resulted in increased competition in the electric generation industry. The introduction of consumer choice in retail electric energy suppliers will result in market forces rather than regulation determining the cost and quality of electricity for all consumers. 54 Amicus Curiae Pub. Serv. Co. of Okla. Br. 8, 15. 55 R. at 1098, 1102; Apellant OG&E Br. in Chief 10. Kane, C.J., dissenting: ¶1 This dispute involves application of the ''one-megawatt exception'' to the Retail Electric Suppliers Certified Territories Act (RESCTA). The RESCTA provides: "The provisions of this act shall not preclude any retail electric supplier from extending its service after the effective date of this act (1) to its own property and facilities, in an unincorporated area, and (2) subject to Section 5 D, to an electric-consuming facility requiring electric service, in an unincorporated area, if the connected load for initial full operation of such electric-consuming facility is to be 1,000 kw or larger." 17 O.S. 2011, § 158.25(E). The issue presented is whether a retail electric supplier is "extending its service" for purposes of the one megawatt exception when employing existing third party transmission lines to supply service within a certified territory not otherwise reachable by said supplier. This use of third party transmission lines was not permitted when the RESCTA was drafted in 1971.1 ¶2 The Oklahoma Corporation Commission correctly applied the above statute, and concluded that it was not designed to allow large outside utilities to ''cherry pick'' electrical loads by the use of third party transmission lines located in certified territories. Appellant is not ''extending'' service in such a scenario, it is tapping into the infrastructure built and maintained by the local electric cooperatives. This approach allowed Appellant to forego the expense of building nine to fourteen miles of new lines, which undoubtedly played into the ability of Appellant to undercut the existing rural supplier by five million dollars in the bidding process. ¶3 The statutory construction employed by the majority creates an exception not foreseen by the legislature, and which will serve to burden the same rural community electric suppliers that the RESCTA sought to protect. Given the fact that it was impossible for a retail electric supplier to ''extend its service'' by the use of third-party transmission lines at the time of the drafting of the RESCTA, I find it an unreasonable construction of the Act to allow a competing electric supplier to ''extend'' into this certified zone in such a fashion at this time. I dissent. FOOTNOTES 1 See Amicus Curiae Okla. Farm Bureau Legal Found., et al. Br. 11 Darby, J., dissenting: ¶1 The issue in this case concerns the construction of a statute. This court must affirm if the Commission "regularly pursued its authority" and its "findings and conclusions . . . are sustained by the law." Okla. Const. art. 9, § 20. Unless otherwise provided, the Oklahoma Constitution provides the standards of review for two categories of cases appealed from the Corporation Commission: 1) those involving violations of Constitutional rights and 2) all other appeals. Okla. Const. art. 9, § 20. Cases involving the first category receive de novo review. Id. All other cases receive a deferential standard of review. Id.; see also Pub. Serv. Co. of Okla. v. State ex rel. Okla. Corp. Comm'n, 2005 OK 47, ¶ 8, 115 P.3d 861, 869-70. The Oklahoma Constitutional standards of review for the two categories of cases are as follows: The Supreme Court's review of appealable orders of the Corporation Commission shall be judicial only, and in all appeals involving an asserted violation of any right of the parties under the Constitution of the United States or the Constitution of the State of Oklahoma, the Court shall exercise its own independent judgment as to both the law and the facts. In all other appeals from orders of the Corporation Commission the review by the Supreme Court shall not extend further than to determine whether the Commission has regularly pursued its authority, and whether the findings and conclusions of the Commission are sustained by the law and substantial evidence. Okla. Cost. art. 9, § 20 (emphasis added). This case does not involve an asserted violation of any constitutional right; consequently, the second standard of review is applicable. The Majority incorrectly equates the more deferential ("[i]n all other appeals from orders of the Corporation Commission the review by the Supreme Court shall not extend further than to determine whether the Commission has regularly pursued its authority, and whether the findings and conclusions of the Commission are sustained by the law and substantial evidence") with "de novo." Maj. Op. at ¶ 7. This the Court should not do. The Majority's illogical mathematical proof leaves much to be desired, especially when this Court has not clearly spoken to what it means for a Commission order to be "sustained by law." The Majority's case cited for the standard of review, originally decided by the Court of Civil Appeals, Dobson Tel. Co. v. State ex rel. Okla. Corp. Comm'n, 2017 OK CIV APP 16, 392 P.3d 295 (approved for publ'n by Okla. Sup. Ct.), makes its statement concerning the constitutional standard1 without citation to authority and then proceeds to cite a non-Corporation Commission, non-agency case, for the general proposition that "[l]egal issues involving statutory interpretation are subject to de novo review." Id. citing Heffron v. Dist. Court of Okla. Cnty, 2003 OK 75, ¶ 15, 77 P.3d 1069. Claiming to employ de novo review, the Majority finds an ambiguity, and tries to interpret the statute using plain language alone rather than using recognized canons of construction. The Majority concludes that the statute does not limit the manner or method of providing service under the large-load exception. I respectfully dissent. ¶2 To ensure each unrestricted territory receives adequate energy supplies, the Legislature guaranteed individual small energy companies exclusive authority to provide energy to consumers within their respective territory. The statutes allow a limited exception for providing service to large loads. The Majority overlooks the guiding purpose in creating the territorial monopolies and replaces its judgment for that of the Legislature. ¶3 In reality the language and statutory definitions in 17 O.S. 2011, §§ 158.22 and 158.25 can mean only one thing--that "extending its service" means "extending [any retail electric supplier's] service"--and "retail electric service" specifically excludes wholesale electric energy. Consequently, I would affirm the Corporation Commission. ¶4 The Majority cites Oral Roberts Univ. v. Okla. Tax Comm'n, 1985 OK 97, 714 P.2d 1013 (hereinafter ORU), for the rule concerning deference to an agency's interpretation. Maj. Op. at ¶ 8. The rule is as follows: Courts will not disturb the administrative construction of an ambiguous or uncertain statute by the agency charged with its administration so long as such construction is reasonable. ORU, ¶¶ 9-10. But the Majority conflates ORU's holding with the rule. Despite the Majority's position, an agency's interpretation does not need to be long-standing in order to receive deference. See id. [I]nterpretation or construction of an ambiguous or uncertain statute by the agency charged with its administration is entitled to the highest respect from the courts, specially when the administrative construction is definitely settled and uniformly applied for a number of years. In such cases the administrative construction will not be disturbed except for very cogent reasons, provided that the construction so given was reasonable. Id. at ¶ 9. There is a type of hierarchy of deference, with long-standing interpretations of regulations given the most controlling weight. See Bell v. Phillips Petroleum Co., 1982 OK 28, ¶ 24, 641 P.2d 1115, 1121-22. When more than one meaning may be attributed to the terms of a regulation, we look to the interpretation given to the regulation by those charged with the duty of executing it. When choosing between two or more possible meanings, controlling weight may be given to the long-continued administrative usage unless it is plainly erroneous or inconsistent with the language. Deference to an agency's interpretation is even more clearly in order when the construction is that of an administrative regulation rather than a statute. Id. (footnotes omitted). It is true that length of time contributes to the amount of deference, but it does not determine whether deference is owed. In ORU the rule concerning deference to agency interpretation comes from the 1930 case McCain v. State Election Bd., 144 Okl. 85, 289 P. 759 (1930): It is a well settled rule that the contemporaneous construction of a statute by those charged with its execution and application, especially when it has long prevailed, while not controlling, is entitled to great weight and should not be disregarded or overturned except for cogent reasons, and unless it be clear that such construction is erroneous. The courts are especially reluctant to overturn a long standing executive or departmental construction where great interests have grown up under it and will be disturbed or destroyed by the announcement of a new rule, or where parties who have contracted with the government upon the faith of such construction will be prejudiced. Id. 762-63 citing 25 Ruling Case Law 1043, ¶ 274. Ultimately the rule, stated without discussion of additional reasons to differently weigh interpretations (long-standing nature, contemporaneous construction), is well put in the famous United States Supreme Court case Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984). The rule is summarized as follows: When a court reviews an agency's construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute. Id. at 2781-82 (footnotes omitted). ¶5 In this case, under the more deferential constitutional standard of review,2 we need not use the rule to defer to an agency's construction of an ambiguous statute or regulation because the intent of the Legislature is made clear; there is no ambiguity as regular canons of construction lead us to the conclusion that "its service" refers to "retail electric service." § 158.22(4). Thus, the Commission's decision will be upheld so long as it is within the Commission's authority and sustained by law. Okla. Cost. art. 9, § 20. ¶6 The pertinent part of subsection E states that "[t]he provisions of this act shall not preclude any retail electric supplier from extending its service. . . ." § 158.27(E). The question raised has been the construction of "extending its service." Maj. Op. at ¶¶ 7-9 (emphasis added). This Court should deploy well known canons of construction to hold "extending its service" means extending "retail electric service," which specifically excludes wholesale, or "energy furnished by an electric supplier to another electric supplier for resale." § 158.22(4).3 ¶7 The first canon this Court should use is a semantic canon regarding the ordinary meaning of words. "Words are to be understood in their ordinary, everyday meanings--unless the context indicates that they bear a technical sense." Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 69 (2012). The Majority recites this canon but fails to properly apply it. See Maj. Op. at ¶ 15 ("If a statute is subject to more than one interpretation, we look to the plain and ordinary meaning of words in a statute unless the Legislature defines the term. In the Matter of the Income Tax Protest of Hare, 2017 OK 60, ¶ 10, 398 P.3d 317, 320.). "Where the text is addressing a scientific or technical subject, a specialized meaning is to be expected: 'In terms of art which are above the comprehension of the general bulk of mankind, recourse, for explanation must be had to those, who are most experienced in that art.'" Reading Law 73. We are dealing with a technical subject in this case. In reviewing § 158.25, several statutorily defined terms are used throughout. Important to the question presented here, "retail electric supplier" and "retail electric service" are defined by statute at § 158.22. The term "retail electric supplier" means any person, firm, corporation, association or cooperative corporation, exclusive of municipal corporations or beneficial trusts thereof, engaged in the furnishing of retail electric service. The term "retail electric service" means electric service furnished to a consumer for ultimate consumption, but does not include wholesale electric energy furnished by an electric supplier to another electric supplier for resale. § 158.22(1), § 158.22(4) (emphasis added). ¶8 In § 158.25 the term "retail electric service" is used six (6) times throughout the statute and the shortened term "service" is used twice. Contextually, "[a] word or phrase is presumed to bear the same meaning throughout a text; a material variation in terms suggests a variation in meaning." Reading Law 170. In this case the Court is reviewing one of the two instances in which only "service" is used in the statute. But, using the last-antecedent canon, one that is essentially a rule of grammar, we find that in both instances that "retail electric service" is the antecedent of the legalistic pronoun such, § 158.25(D), and the possessive determiner (type of pronoun) its, § 158.25(E). See Reading Law 144 (the last-antecedent canon provides: "A pronoun, relative pronoun, or demonstrative adjective generally refers to the nearest reasonable antecedent.") That is, "such" and "its" refer to the earlier antecedents "retail electric service" and "retail electric supplier," respectively. To wit, D. Except as provided in Section 5 C, no retail electric supplier shall furnish, make available, render or extend retail electric service to any electric-consuming facility to which such service is being lawfully furnished by another retail electric supplier on the effective date of this act, or to which retail electric service is lawfully commenced thereafter in accordance with this section by another retail electric supplier. E. The provisions of this act shall not preclude any retail electric supplier from extending its service after the effective date of this act (1) to its own property and facilities, in an unincorporated area, and (2) subject to Section 5 D, to an electric-consuming facility requiring electric service, in an unincorporated area, if the connected load for initial full operation of such electric-consuming facility is to be 1,000 kw or larger. § 158.25(D), § 158.25(E) (emphasis added). ¶9 As a final effort, the Majority claims that there is no evidence that OG&E is purchasing energy from WFEC by using their transmission lines. Maj. Op. at ¶ 30. Instead of an altruistic WFEC, we actually do have testimonial evidence discussing the methodology for calculating certain costs and payment of "tap fees" from OG&E to WFEC. Testimony of Bruce Breshears on behalf of OG&E discusses a calculation of the annual customer payment. It includes "taking the annual bill (customer charge, energy charge, and demand charge) to get an incremental annual bill less the charges from [sic] paid by OG&E to Western Farmers Electric Cooperative." Report and Recommendation of the Administrative Law Judge p. 19. There is also discussion of a "tap fee" as affecting annual revenue. See Report and Recommendation of Administrative Law Judge p. 29. The tap fee paid by OG&E to WFEC increases as the load increases, which ultimately affects OG&E's bottom line.4 ¶10 "Extend its service" has a technical meaning defined by the Legislature and should not be read in the ordinary sense. To do so replaces the Legislature's judgment. Additionally, it nullifies in large part the purpose of the monopoly by allowing any retail electric supplier to tap into another's distribution lines or infrastructure to reach into another retail electric supplier's certified territory. It allows any retail electric supplier to cherry pick only the very best, most economical loads to serve. Permitting this crushes retail electric suppliers in their respective certified territories. It also economically damages co-ops in rural Oklahoma and those customers who are served by cost of service electric co-ops. To allow any retail electric supplier to buffet-style pick the most profitable economic loads to serve leaves co-ops as the provider of last resort, drives the cost up for rural customers, and runs completely counter to the desired statutory goals. ¶11 I respectfully dissent. FOOTNOTES 1 The Dobson Court said "[w]hether this court exercises its 'independent judgment' as to the Commission's statutory interpretation or reviews that interpretation to determine whether it is 'sustained by the law,' our review is the same and no different than the de novo review we employ regarding issues of law in other contexts." Dobson Tel. Co. v. State ex rel. Okla. Corp. Comm'n, 2017 OK CIV APP 16, ¶ 5, 392 P.3d 295, 298 (approved for publ'n by Okla. Sup. Ct.). 2 Okla. Cost. art. 9, § 20 provides: The Supreme Court's review of appealable orders of the Corporation Commission shall be judicial only, and in all appeals involving an asserted violation of any right of the parties under the Constitution of the United States or the Constitution of the State of Oklahoma, the Court shall exercise its own independent judgment as to both the law and the facts. In all other appeals from orders of the Corporation Commission the review by the Supreme Court shall not extend further than to determine whether the Commission has regularly pursued its authority, and whether the findings and conclusions of the Commission are sustained by the law and substantial evidence. (emphasis added). 3 The Majority's claim that there is "no indication in the record that OG&E is purchasing electricity for wholesale to a third party" is untrue. There was testimony about OG&E's Allowable Expenditure Formula which included discussion of the annual customer payment--that is OG&E's customer ONEOK. The witness discusses the annual bill less the charges paid by OG&E to Western Farmers Electric Cooperative for the cost of wholesale energy. See Report and Recommendation of Administrative Law Judge pp. 17-20. 4 Testimony provides that "an incremental Tap Fee to connect to the WFEC transmission grid is removed from the annual revenue" as a reason why an OG&E equation is incorrect. Report and Recommendation of the Administrative Law Judge p. 29. The Witness testified it was his opinion that the revenue was overstated because "the Tap Fee used by OG&E is significantly understated. The incremental transmission cost associated with the new load would be equal to the load ratio share of WFEC's zonal transmission costs which results in a cost for the new load almost 3 and one-half times greater than that stated by OG&E. This additional cost would reduce the revenue available for use in OG&E's allowable expenditure calculation. . . ." Id.

66c96f62-ada9-4983-986e-7ff5533f4ce1

Kpiele-Poda v. Patterson-UTI Energy, et al.

oklahoma

Oklahoma Supreme Court

KPIELE-PODA v. PATTERSON-UTI ENERGY2023 OK 11Case Number: 119375Decided: 02/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. MWANDE SERGE KPIELE-PODA, an individual, Plaintiff/Appellant, v. PATTERSON-UTI ENERGY, INC., UNIVERSAL PRESSURE PUMPING, INC., SEVENTY SEVEN OPERATING, LLC, PERFORMANCE TECHNOLOGIES LLC, CAMBELT INTERNATIONAL CORP., CAMBELT INTERNATIONAL, LLC, CAMBELT INTERNATIONAL, LLC, U.S. SILICA COMPANY, SANDBOX LOGISTICS, LLC, SANDBOX ENTERPRISES, LLC, SANDBOX LEASING, LLC, SANDBOX TRANSPORTATION, LLC, and CASILLAS OPERATING, LLC, Defendants, and OVINTIV MID-CONTINENT, INC., Defendant/Appellee. MWANDE SERGE KPIELE-PODA, an individual, Plaintiff/Appellant, v. PATTERSON-UTI ENERGY, INC., UNIVERSAL PRESSURE PUMPING, INC., SEVENTY SEVEN OPERATING, LLC, PERFORMANCE TECHNOLOGIES LLC, Defendants/Appellees, and CAMBELT INTERNATIONAL CORP., CAMBELT INTERNATIONAL, LLC, CAMBELT INTERNATIONAL, LLC, U.S. SILICA COMPANY, SANDBOX LOGISTICS, LLC, SANDBOX ENTERPRISES, LLC, SANDBOX LEASING, LLC, SANDBOX TRANSPORTATION, LLC, CASILLAS OPERATING, LLC, and OVINTIV MID-CONTINENT, INC. Defendants. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY, STATE OF OKLAHOMA HONORABLE CINDY H. TRUONG, TRIAL JUDGE ¶0 Employee was injured at a wellsite in Kingfisher County while repairing a conveyor that activated and crushed his legs. While Employee's Workers' Compensation claim was still pending, he filed a petition asserting negligence and products liability in the District Court of Oklahoma County against his employers, two wellsite operators, and the manufacturers and distributors of the conveyor. Ovintiv Mid-Continent, Inc. was named in the body of the petition but omitted from the caption. After the statute of limitations period expired, Employee amended his petition to add Ovintiv Mid-Continent, Inc. as a defendant in the petition's caption. A second amended petition added other parties. Ovintiv Mid-Continent, Inc. moved to dismiss arguing the claim was time-barred because the amended petition did not relate back to the first petition. Employee's employers also moved to dismiss arguing the Administrative Workers' Compensation Act and Oklahoma precedent preclude employees from simultaneously maintaining an action before the Workers' Compensation Commission and in the district court. The district court granted each dismissal motion and certified each order as appealable pursuant to 12 O.S.2011, § 994(A). We retained and consolidated Employee's separate appeals. We hold: 1) the district court erred when it dismissed Employee's action against Ovintiv Mid-Continent, Inc. as time-barred; and 2) the district court properly dismissed Employee's intentional tort action for lack of subject matter jurisdiction. MATTERS PREVIOUSLY RETAINED FOR DISPOSITION; DISTRICT COURT AFFIRMED IN PART, REVERSED IN PART. Daniel Talbot, TALBOT LAW GROUP, Oklahoma City, Oklahoma for Plaintiff/Appellant, Mwande Serge Kpiele-Poda. J. Todd Woolery, Jodi C. Cole, and Katelyn King, MCAFEE & TAFT, Oklahoma City, Oklahoma for Defendant/Appellee Ovintiv Mid-Continent, Inc. Toby McKinstry, TOMLINSON -- MCKINSTRY, P.C., Oklahoma City, Oklahoma for Defendants/Appellees Patterson-UTI Energy, Inc., Universal Pressure Pumping, Inc., Seventy Seven Operating, LLC, and Performance Technologies, LLC. OPINION ROWE, V.C.J.: ¶1 In this consolidated appeal of separate district court dismissal orders, we are tasked with deciding two questions: 1) whether the district court erred by dismissing Employee's amended petition, finding it was time-barred; and 2) whether the district court erred by dismissing Employee's intentional tort claim while his workers' compensation claim remained pending. I. BACKGROUND ¶2 On June 4, 2018, Mwande Serge Kpiele-Poda ("Employee") was injured at a wellsite while repairing a Sandbox Conveyor ("Conveyor"). During the repair, a part of the Conveyor activated and crushed both of Employee's legs. Employee filed a workers' compensation claim for injury to his legs and lower back, naming Universal Pressure Pumping, Inc. ("UPPI") as his employer. This claim remains pending. ¶3 Following the injury, Employee received medical treatment, and UPPI's workers' compensation insurance carrier voluntarily paid Employee temporary benefits. The Workers' Compensation Commission ("Commission") issued orders awarding medical examinations, authorizing medical treatment, and changes in treating physician. ¶4 On June 2, 2020, two days before the expiration of the statute of limitations for Employee's claims relating to his injuries, he filed a petition ("Original Petition") in Oklahoma County District Court against his employer, the manufacturer of the Conveyor, and the owner and operators of the well location. Employee alleged that UPPI and three other alleged employers, Patterson-UTI Energy, Inc., Seventy Seven Operating, LLC, and Performance Technologies, LLC (collectively, "Employers"), "ordered, encouraged, allowed, or otherwise caused Plaintiff to service and/or repair a part of the Sandbox Conveyor while requiring other parts of the Sandbox Conveyor to continue operating with the knowledge that injury and/or death was substantially certain to occur not merely foreseeable or substantially likely."1 Employee also referred to Ovintiv Mid-Continent, Inc. ("Ovintiv") in the general allegations as an owner or operator of the wellsite and alleged Ovintiv contributed to Employee's injuries under a theory of negligence.2 Employee did not list Ovintiv as a defendant in the caption of the lawsuit. ¶5 Before serving the Original Petition on any defendant, but after the limitations period expired, Employee discovered the omission of Ovintiv in the caption. On September 23, 2020, Employee filed an amended petition ("Amended Petition"), which included Ovintiv in the caption.3 All defendants were served with summons and the Amended Petition on October 26, 2020, followed by a second amended petition served almost a month later. ¶6 Ovintiv and Employers filed separate motions for dismissal. Ovintiv's motion to dismiss argued Employee's negligence claim was time-barred because Ovintiv was not sued prior to the expiration of the statute of limitations and the Amended Petition did not relate back to the original filing date pursuant to Oklahoma's relation back statute.4 The district court granted Ovintiv's motion to dismiss, concluding "the statute of limitation ran"5 and also granted Employee's oral motion to certify the ruling as immediately appealable. Employee timely appealed the dismissal order and we retained the matter for disposition. ¶7 Employers' motion to dismiss argued the district court lacked subject matter jurisdiction over Employee's intentional tort claim because Employee's remedy was under the exclusive jurisdiction of the Commission.6 The district court granted Employers' motion to dismiss, finding Employee could not simultaneously maintain an action before the Commission and the district court. Employee appealed, and we retained the matter for disposition. We consolidated Employee's separate appeals for review. II. STANDARD OF REVIEW ¶8 This Court will review the district court's grant of dismissal motions de novo. See, e.g., Woods v. Prestwick House, Inc., 2011 OK 9, ¶ 14, 247 P.3d 1183, 1187--88 (although limitations issues may involve mixed questions of fact and law, generally, in this Court they are reviewed de novo); Farley v. City of Claremore, 2020 OK 30, ¶ 17, 465 P.3d 1213, 1224 (an order granting a motion to dismiss that raises a jurisdictional issue is reviewed de novo and allegations of a petition are deemed as true similar to a review of a § 2012(B)(6) motion to dismiss). ¶9 The issues before us pose questions of statutory interpretation. A statute's construction and application presents a question of law that is reviewed de novo. Strickland v. Stephens Prod. Co., 2018 OK 6, ¶ 4, 411 P.3d 369, 372. De novo review "involves a plenary, independent, and non-deferential examination of the trial court's legal rulings." Id. III. ANALYSIS A. Employee's Original Petition Was Timely Filed Against Ovintiv. ¶10 Oklahoma's general rules of pleading require a pleading to contain only "[a] short and plain statement of the claim showing the pleader is entitled to relief." 12 O.S.Supp.2013, § 2008(A)(1). In addition, a pleading must contain a caption which sets forth the name of the court, title of the action, file number, and "shall include the names of all the parties." 12 O.S.2011, § 2010(A).7 However, "[t]he general philosophy in [Oklahoma's Pleading Code, 12 O.S.2011, § 2001 et seq.] is that pleadings should give fair notice of the claim and be subject to liberal amendment, should be liberally construed so as to do substantial justice, and that decisions should be made on the merits rather than on technical niceties." Wilson v. Webb, 2009 OK 56, ¶ 9, 221 P.3d 730, 734. ¶11 Both parties cite Klopfenstein v. Oklahoma Deptartment of Human Services, 2008 OK CIV APP 16, 177 P.3d 594 in support of their position.8 In Klopfenstein, the Oklahoma Court of Civil Appeals held "[a]lthough the Oklahoma and federal rules of pleading require parties to be named in the caption of a petition, the failure to do so is not necessarily fatal." Id. ¶ 14, 177 P.3d at 597.9 Employee contends the omission of Ovintiv is not fatal because the Original Petition clearly states a cause of action against Ovintiv, and Ovintiv received notice within the required time period. Ovintiv argues that while the failure to name a party in the caption of a lawsuit is not always fatal to the action, it did not receive "fair notice"10 and would be prejudiced if forced to defend against the alleged claims. ¶12 Ovintiv's contention that it did not receive notice is misguided. Contrary to Ovintiv's position, the law does not require notice prior to the expiration of the statute of limitations.11 12 O.S.Supp.2017, § 2004(I)12 requires service to be made 180 days from the date of filing. Here, Employee was required to serve summons of the petition within 180 days of the date of filing the Original Petition. Before serving the Original Petition on all defendants, Employee discovered Ovintiv's omission from the caption. Employee timely amended his petition to correct the mistake pursuant to 12 O.S.Supp.2018, § 2015(A).13 The Amended Petition was then served on all defendants on September 23, 2020--well within the 180 day service requirement. Thus, Ovintiv received fair notice of the claims against it along with the other defendants. ¶13 Here, the omission of Ovintiv in the lawsuit's caption is not fatal. The caption of a petition is the heading which shows the names of the parties, the name of the court, and number of the case on the docket--the caption is not part of the substance of a petition. Although § 2010(A) requires the name of all parties to be included in the caption, an omission of a party from a caption is not necessarily fatal. The omission of a party from the caption is not fatal where the party is sufficiently named in the body of the petition; § 2010(A) is satisfied by an amended petition filed pursuant to § 2015(A); and the amended petition is served within 180 days from the filing date of the original petition pursuant to § 2004(I). ¶14 Reading § 2010(A) in harmony with § 2015(A) and § 2004(I), we find Employee's Original Petition was timely filed against Ovintiv. The body of the Original Petition identified Ovintiv as an owner of and or operator of the site on which Employee was working and where Ovintiv could be served with process;14 Employee amended the Original Petition to add Ovintiv to the caption; and Ovintiv received fair notice when Ovintiv was served with the Amended Petition within 180 days of the filing of the Original Petition. Our finding comports with the Oklahoma Pleading Code's objective to promote substantial justice and our extant caselaw. Accordingly, the trial court's dismissal of Employee's action against Ovintiv as time-barred is reversed.15 B. Employee May Not Simultaneously Maintain An Action in the Workers' Compensation Court and the District Court. ¶15 Oklahoma's Administrative Workers' Compensation Act ("AWCA") places a duty upon employers to bear the responsibility for compensating employees for accidental personal injuries arising out of and in the course of employment. 85A O.S.2014, § 3.16 For accidental injuries incurred in the course of employment, the rights and remedies afforded to the injured employee under AWCA are "exclusive of all other rights and remedies of the employee." 85A O.S.2014, § 5(A).17 The exclusive remedy does not apply, however, if an employer fails to secure payment of compensation or if the injury was caused by an intentional tort committed by the employer. 85A O.S.2014, § 5(B).18 If either exception is present, "the injured employee or his legal representative may maintain an action either before the Commission or in the district court, but not both." 85A O.S.2014, § 5(I).19 ¶16 The question of whether Employee is statutorily entitled to maintain an action for intentional tort in the district court while simultaneously pursuing a workers' compensation claim concerns the application and interpretation of 85A O.S.2014, § 5(I). Section 5(I) provides: If the employer has failed to secure the payment of compensation as provided in this act or in the case of an intentional tort, the injured employee or his legal representative may maintain an action either before the commission or in the district court, but not both. Employers contend Employee's work-related injuries fall exclusively within the jurisdiction of the Commission, and that 85A O.S.2014, § 5(I) prohibits Employee from simultaneously pursuing a remedy for the same injuries before the Commission and the district court. Conversely, Employee contends he has a right under AWCA to assert a claim in the district court for intentional tort because he has not elected his remedy with the Commission, or in the alternative, he is not precluded from maintaining an action in the district court because the Commission has not rendered a final adjudication. ¶17 To support their position, Employers rely upon Farley v. City of Claremore, 2020 OK 30, 465 P.3d 1213. In Farley, a spouse's husband was killed due to a work-related injury. She sought and obtained workers' compensation death benefits for the death of her husband. Eleven months after the conclusion of the workers' compensation proceeding, she brought a claim in the district court for damages alleging her husband's death was caused by an intentional tort committed by her husband's employer. Id. ¶ 1, 465 P.3d at 1218. The employer filed a motion to dismiss arguing the "workers' compensation remedy was the sole remedy for the plaintiff and plaintiff has previously and successfully pursued that remedy and was seeking double recovery." Id. ¶ 3, 465 P.3d at 1219. The district court granted the employer's motion to dismiss for lack of subject matter jurisdiction and plaintiff appealed to this Court. We upheld the dismissal, finding that because her spouse's wrongful death injury was fully adjudicated and compensated, the successful adjudication demonstrated the injury was exclusively before the Commission and not within the jurisdiction of the district court. Id. ¶ 68, 465 P.3d at 1243. ¶18 Employers' reliance on Farley is misguided. In Farley the surviving spouse successfully concluded her workers' compensation claim then asserted a claim in the district court, wherein we applied the doctrine of claim preclusion.20 Claim preclusion was applicable because the surviving spouse sought an intentional tort claim in the district court after her workers' compensation claim reached a final adjudication. We held "an adjudication of the accidental nature of an employee's death precludes a subsequent District Court action collaterally attacking the accidental nature of the injury alleging it arose from an intentional tort outside the jurisdictional scope of an award by the Workers' Compensation Commission." Id. ¶ 30, 465 P.3d at 1230. Farley is not conclusive here because the facts are distinguishable and the doctrine of claim preclusion is not applicable. ¶19 To answer the question before us, we look to the text of § 5(I). "The cardinal rule of statutory interpretation is to ascertain and give effect to legislative intent and purpose as expressed by statutory language." Odom v. Penske Truck Leasing Co., 2018 OK 23, ¶ 17, 415 P.3d 521, 528. "It is presumed that the Legislature has expressed its intent in a statute's language and that it intended what it so expressed." Id. "Only where legislative intent cannot be ascertained from the language of a statute, as in cases of ambiguity, are rules of statutory interpretation employed." Id. ¶ 18, 415 P.3d 521, at 528. (citations omitted). "The test for ambiguity in a statute is whether the statutory language is susceptible to more than one reasonable interpretation." Id. (citations omitted). ¶20 We find no ambiguity in § 5(I). Section 5(I) permits an employee to maintain an action either before the Commission or in the district court, but not both. The word "either" demonstrates the Legislature intended for an employee to choose one forum to pursue his claim--not two forums. This interpretation is further supported by the statute's language "but not both" at the end of the sentence. Such language reinforces the requirement to choose between two forums--which serves to protect employers from defending against two claims filed simultaneously in different forums--and bolsters the underlying public policy against double recovery. ¶21 Despite the explicit language, Employee contends he may maintain a claim in both forums simultaneously because his workers' compensation claim has not yet reached a point of conclusion. His position is contrary to the text. First, the text does not say that one claim must reach finality to exclude the pursuit of a claim in another forum. Second, the text says an employee may "maintain an action." The plain and ordinary meaning of "maintain an action" means to pursue, continue, or institute.21 Thus, when an employee chooses a forum, invokes its jurisdiction, and pursues that claim, he is effectively maintaining his action. ¶22 When an employee's injury arises out of and in the course of employment, the rights and remedies granted to that employee are exclusive under AWCA, meaning there is not a choice between different forums. However, when allegations of intentional tort are present, the rights and remedies are no longer exclusive under AWCA, and a choice between two forums is available. According to the text of § 5(I), the injured employee is afforded a choice of pursuing and maintaining an action either before the Commission or in the district court, but not both. ¶23 Here, Employee's injuries arose out of and in the course of his employment; thus his rights and remedies fell under AWCA. However, Employee's allegations of intentional tort against Employers provided him a choice between two forums--the Commission or the district court, but not both. Employee gave notice of his claim for compensation by filing a CC-Form 3,22 which invoked the jurisdiction of the Commission.23 Employee chose the Commission as the forum in which to pursue his remedy when he filed the CC-Form 3. While his workers' compensation claim remained pending, he filed his district court action, which is explicitly prohibited by the text of § 5(I). Employee is not entitled to maintain an action simultaneously before the Commission and in the district court. Accordingly, the trial court's dismissal of Employee's tort action against Employers for lack of subject matter jurisdiction is affirmed. IV. CONCLUSION ¶24 We find Employee's Original Petition was timely filed against Ovintiv. Although Ovintiv was not included in the caption of the Original Petition, Ovintiv was sufficiently included in the body of the Original Petition, Employee timely amended the Original Petition to include Ovintiv in the caption, and Ovintiv received fair notice when it was served the Amended Petition within 180 days. Accordingly, the district court's dismissal is reversed. ¶25 We find 85A O.S. § 5(I) of the Administrative Workers' Compensation Act unambiguously permits an employee to maintain an action either before the Commission or in the district court, but not both. Employee invoked the jurisdiction of the Commission and has maintained his action in that forum. Accordingly, Employee is statutorily prohibited from maintaining a simultaneous action in the district court and the district court's dismissal is affirmed. MATTERS PREVIOUSLY RETAINED FOR DISPOSITION; DISTRICT COURT AFFIRMED IN PART, REVERSED IN PART. Kane, C.J., Rowe, V.C.J., Winchester, Edmondson, Kuehn, JJ., concur. Gurich, J., (by separate writing), with whom Kauger, Combs, and Darby, JJ., join, concurring in part and dissenting in part. FOOTNOTES 1 Employee's Original Petition, ¶ 8. 2 Paragraph Four of Employee's Original Petition in the "General Allegations" alleges, "On or about June 4, 2018, Ovintiv Mid-Continent, Inc. (a Delaware Corporation that can be served with process by serving the registered service agent, Corporation Service Company, 10300 Greenbriar Place, Oklahoma City, OK 73159) was the owner of and/or operator in charge of the site on which Plaintiff was working." Paragraphs 27-29 of Employee's Original Petition under Employee's "Fourth Cause of Action -- Products Liability" alleges Ovintiv Mid-Continent and Casillas Operating, LLC were acting in concert with each other in a negligent manner that resulted in the injuries; Ovintiv Mid-Continent is "responsible under a theory of respondeat superior;" and as a result of Ovintiv Mid-Continent's negligence, Employee suffered injuries. 3 The Amended Petition also amended the heading of the Fourth Cause of Action from Products Liability to Negligence. 4 Ovintiv's Motion to Dismiss seeks dismissal only of Defendant Ovintiv Mid-Continent, Inc.. 5 Trial Tr. 12:8. 6 Employers' Motion to Dismiss seeks dismissal of the following alleged Employers: Universal Pressure Pumping, Inc., Patterson-UTI Energy, Inc., Seventy Seven Operating, LLC, and Performance Technologies, LLC. 7 "A. CAPTION; NAMES OF PARTIES. Every pleading shall contain a caption setting forth the name of the court, the title of the action, the file number, and a designation as in subsection A of Section 7 of this act. In the petition the title of the action shall include the names of all the parties, but in other pleadings it is sufficient to state the name of the first party on each side with an appropriate indication of other parties. In a third-party petition the title of the action shall include the names of the parties to the third-party action; a counterclaim and a cross-claim shall include the names of the claimants and the parties against whom the claim is asserted; and a motion and petition in intervention shall include the names of the intervenors and the adverse parties. When a party is suing or being sued in a representative capacity, this should be stated in the title of the action." 12 O.S.2011, § 2010(A) (emphasis added). 8 In Klopfenstein, the appellant filed a petition with the Oklahoma Merit Protection Commission ("MPC") alleging that the Department of Human Services ("DHS") had removed her essential job duties in retaliation for appellant filing an internal grievance. Klopfenstein, 2008 OK CIV APP 16, ¶ 2, 177 P.3d at 595. The MPC denied the petition and appellant filed a petition for administrative appeal in the trial court. The petition for appeal did not name MPC as a party defendant in its caption, but MPC was named in the body of the petition and MPC received notice of the petition for appeal. Id. at ¶ 4, 177 P.3d at 596. DHS moved to dismiss on the grounds that appellant failed to name MPC as a defendant in the action. Id. ¶ 5, 177 P.3d at 596. The district court determined that although "MPC was not named as a party in the caption, . . . MPC was clearly named as party in the body of the petition." Id. ¶ 13, 177 P.3d at 597. The Court of Civil Appeals agreed with appellant that "the petition must be read as a whole." Id. 9 We are not bound by the decisions of the Court of Civil Appeals. "The Court of Civil Appeals opinions are not binding on this Court. . ." Foshee v. Foshee, 2010 OK 85, ¶ 14, 247 P.3d 1162, 1168 n.6. 10 Ovintiv's Motion to Dismiss cites to Klopfenstein v. Okla. Dept. of Human Serv., 2008 OK CIV APP 16, ¶ 14, 177 P.3d 594, 599. 11 Once an action is initiated within the prescribed statute of limitations, a plaintiff has 180 days after the filing of the petition to serve summons upon the defendant. 12 O.S.Supp.2017, § 2004(I). 12 O.S.Supp.2017, § 2004(I) provides "If service of process is not made upon a defendant within one hundred eighty (180) days after the filing of the petition and the plaintiff has not shown good cause why such service was not made within that period, the action shall be deemed dismissed as to that defendant without prejudice." 12 "I. SUMMONS: TIME LIMIT FOR SERVICE. If service of process is not made upon a defendant within one hundred eighty (180) days after the filing of the petition and the plaintiff has not shown good cause why such service was not made within that period, the action shall be deemed dismissed as to that defendant without prejudice. The action shall not be dismissed if a summons was served on the defendant within one hundred eighty (180) days after the filing of the petition and a court later holds that the summons or its service was invalid. After a court quashes a summons or its service, a new summons may be served on the defendant within a time specified by the judge. If the new summons is not served within the specified time, the action shall be deemed to have been dismissed without prejudice as to that defendant. This subsection shall not apply with respect to a defendant who has been outside of this state for one hundred eighty (180) days following the filing of the petition." 12 O.S.Supp.2017, § 2004(I). 13 According to 12 O.S.Supp.2018, § 2015(A), "[a] party may amend his or her pleading once as a matter of course at any time before a responsive pleading is served." Because Employee did not serve the Original Petition, he was free to amend the Original Petition and timely serve the Amended Petition. 14 See Employee's Original Petition, pg 3, ¶ 4. 15 Because we resolve Employee's appeal to Ovintiv's Motion to Dismiss by finding Ovintiv was timely sued, we do not need to address the arguments raised regarding Oklahoma's Relation Back Statute, 12 O.S.Supp.2018, § 2015(C). 16 85A O.S.2014, § 3(A) provides in relevant part, "A. Every employer and every employee, unless otherwise specifically provided in this act, shall be subject and bound to the provisions of the Administrative Workers' Compensation Act and every employer shall pay or provide benefits according to the provisions of this act for the accidental injury or death of an employee arising out of and in the course of his or her employment, without regard to fault for such injury, if the employee's contract of employment was made or if the injury occurred within this state." 17 "A. The rights and remedies granted to an employee subject to the provisions of the Administrative Workers' Compensation Act shall be exclusive of all other rights and remedies of the employee, his legal representative, dependents, next of kin, or anyone else claiming rights to recovery on behalf of the employee against the employer, or any principal, officer, director, employee, stockholder, partner, or prime contractor of the employer on account of injury, illness, or death. Negligent acts of a co-employee may not be imputed to the employer. No role, capacity, or persona of any employer, principal, officer, director, employee, or stockholder other than that existing in the role of employer of the employee shall be relevant for consideration for purposes of this act, and the remedies and rights provided by this act shall be exclusive regardless of the multiple roles, capacities, or personas the employer may be deemed to have." 85A O.S.2014, § 5(A). 18 "B. Exclusive remedy shall not apply if: 1. An employer fails to secure the payment of compensation due to the employee as required by this act. An injured employee, or his or her legal representative in case death results from the injury, may, at his or her option, elect to claim compensation under this act or to maintain a legal action in court for damages on account of the injury or death; or 2. The injury was caused by an intentional tort committed by the employer. An intentional tort shall exist only when the employee is injured as a result of willful, deliberate, specific intent of the employer to cause such injury. Allegations or proof that the employer had knowledge that the injury was substantially certain to result from the employer's conduct shall not constitute an intentional tort. The employee shall plead facts that show it is at least as likely as it is not that the employer acted with the purpose of injuring the employee. The issue of whether an act is an intentional tort shall be a question of law." 85A O.S. 2014, § 5(B). 19 "I. If the employer has failed to secure the payment of compensation as provided in this act or in the case of an intentional tort, the injured employee or his or her legal representative may maintain an action either before the Commission or in the district court, but not both." 85A O.S.2014, § 5(I). 20 "Res judicata is identified with claim preclusion and ordinarily applied when a claim in a second suit is the same as the claim adjudicated on the merits and to finality in the first proceeding." Farley v. City of Claremore, 2020 OK 30, ¶ 24, 465 P.3d 1213, 1227. 21 The Fifth Edition of Black's Law Dictionary provides that "maintain an action" "may mean to commence or institute it; the term imports the existence of a cause of action. . . . In this connection it means to continue to preserve in or with; to carry on." Maintain, Black's Law Dictionary (5th ed. 1979). The Eleventh Edition of Black's Law Dictionary defines "maintain" as "to continue (something)." Maintain, Black's Law Dictionary (11th ed. 2019). 22 A CC-FORM-3 is an employee's first notice of a claim for compensation. 23 "The jurisdiction of the Workers' Compensation Court is vested at the time an employee or employer gives notice of a work related injury." Romero v. Workers' Compensation Court, 1993 OK 150, ¶ 9, 863 P.2d 1251, 1254. GURICH, J., with whom Kauger, Combs, and Darby, J.J., join, concurring in part and dissenting in part: ¶1 I concur in the majority decision to reverse the trial court's dismissal of Ovintiv Mid-Continent but dissent to affirmation of the trial court's dismissal of UPPI and the related defendants. ¶2 Plaintiff alleges that he was employed by Universal Pressure Pumping, Inc. ("UPPI"). Plaintiff also alleges that the parent company of Universal Pressure, Seventy Seven Operating LLC and Performance Technologies, LLC is Patterson-Uti Energy, Inc. Plaintiff refers to these entities as the UPPI defendants. He alleges that at the time of his injury on June 4, 2018, he was in the course and scope of his employment for one or all of the UPPI defendants. Plaintiff brings his first cause of action against these defendants alleging an intentional tort. ¶3 On October 16, 2018, Plaintiff filed a Form 3 with the Workers' Compensation Commission against Universal Pressure Pumping, Inc., alleging that he was employed by UPPI at the time of his accident. He sustained bilateral fractures to his femurs. He also alleged a consequential back injury. Plaintiff admits that he has received temporary total disability ("TTD") payments and medical treatment from the insurance carrier for his employer, ACE American Insurance Co. ¶4 The Form-A Order recites that the respondent admits that the Claimant sustained a compensable injury. Claimant's injury satisfies the definition of compensable injury for a workers' compensation claim, but sustaining a compensable injury does not by itself establish jurisdiction.1 Although, an individual injured on the job generally has only one available remedy before the Workers' Compensation Commission ("Commission"), Section 5(B) of Title 85A excepts this exclusive remedy in cases where the employee's injury was caused by an intentional tort.2 In the case of an intentional tort, the injured employee can pursue a workers' compensation claim or a civil action in district court. Title 85A, Section 5(I) states: If the employer has failed to secure the payment of compensation as provided in this act or in the case of an intentional tort, the injured employee or his or her legal representative may maintain an action either before the Commission or in the district court, but not both. 85A O.S. Supp. 2013, § 5(I). ¶5 Even if a claimant files with the Commission, they may dismiss the pending claim at any time before final submission of the case to the Commission for decision. Title 85A, Section 108 provides: Any claimant may, upon the payment of the Workers' Compensation Commission's filing fee, dismiss any claim brought by the claimant at any time before final submission of the case to the Commission for decision. Such dismissal shall be without prejudice unless the words "with prejudice" are included in the order. If any claim that is filed within the statutory time permitted by Section 18 of this act is dismissed without prejudice, a new claim may be filed within one (1) year after the entry of the order dismissing the first claim even if the statutory time for filing has expired. 85A O.S. Supp. 2013, § 108. The only final adjudication of a workers' compensation claim is by joint petition settlement set forth in 85A O.S. Supp. 2013, § 115 or by adjudication by the Commission pursuant to 85A O.S. Supp. 2013, § 116. ¶6 The Court in Pryse Monument Co. v. District Court of Kay County, 1979 OK 71, 595 P.2d 435, addressed the issue of dual remedies arising from a single injury and the necessity for a final conclusion to bar other remedies. The Court opined that when two coexisting but inconsistent remedies were pending, "one of them, at the claimant's election, would be abatable as vexatious." ¶ 2, 595 P.2d at 437 (emphasis added). "The abatement's inchoate bar becomes absolute and conclusive when the remedy, once chosen has been pursued to a point of conclusion." Id. (emphasis added). To make this bar applicable, three elements are required: "(a) two or more remedies must be in existence (b) the available remedies must be inconsistent (c) choice of one remedy and its pursuit to conclusion must be made with knowledge of alternatives that are available." Id. (emphasis added). Pryse takes great care to point out that the remedy must be pursued to a point of conclusion and that it is the claimant's choice which remedy to pursue. ¶7 A more recent case, Farley v. City of Claremore, 2020 OK 30, 465 P.3d 1214, affirmed this single recovery theory. In Farley, a surviving spouse pursued and received death benefits from the Commission. Id. ¶¶ 1--3, 465 P.3d 1218--20. Ten months after the Commission's award of death benefits, the surviving spouse brought a tort claim for the same injury in district court. Id. ¶ 3, 465 P.3d 1220. The Court held that the Plaintiff's action in district court was estopped because she had received a final order awarding death benefits from the Oklahoma Workers' Compensation Commission. Id. ¶¶ 4, 5, 67 465 P.3d at 1214, 43. Like in Pryse, Farley takes great care to state that the preclusive effect of obtaining benefits from the Commission does not exist until after a final adjudication from the Commission. The Court stated: Generally, res judicata and collateral estoppel apply to jurisdictional questions, and to a final and express adjudication of an issue properly before an administrative body that is subsequently raised between the same parties or their privies. The preclusive effect of a final adjudication includes a final determination before the Workers' Compensation Commission. This final adjudication includes a determination an injury is compensable because it resulted from an accident. Id. ¶ 30, 465 P.3d 1229--30 (emphasis added). ¶6 In this case, The Plainitff sustained a very serious injury and promptly filed his claim with the Commission.3 The record is clear on this issue--there is no adjudication of compensability and claimant is not actively pursuing adjudication. In fact, a request to hold the case in abeyance has been filed. It is not clear that the Commission will in fact stay this case because a delay in the case may result in the employer seeing a dismissal.4 Yet, the majority will dismiss this case due to its construction of Section 5(I) to mean that Plaintiff may only file an action in either the Commission or the district court, not both. ¶7 The majority's holding in this case is too restrictive. Section 5(I) refers to a prohibition against maintaining an action before both the Commission and the district court.5 To maintain an action implies that the action will continue to its final conclusion.6 Filing a claim simply preserves the remedy. This is borne out if you look at the rationale behind the limiting language and the applicable case law. ¶8 The language limiting recovery to one court is so that the injured employee does not double dip and receive two sets of damages for the same injury.7 Until there is a finalized recovery, however, there can be no double dipping. This is because a claimant has not received a remedy until a final order is entered. See Pryse Monument Co. v. District Court of Kay County, 1979 OK 71, 595 P.2d 435; Farley v. City of Claremore, 2020 OK 30, 465 P.3d 1214. There is solid reasoning for why this is--a claimant may not even be able to recoup under one remedy, but if they are estopped from even being able to file to preserve another remedy, they may be wholly blocked from pursuing their legitimate claim.8 ¶9 Importantly, allowing such a case to proceed to its final conclusion does not prejudice any party, not even the insurer who has voluntarily paid out benefits. The insurer would be allowed to recoup any errantly paid benefits against the claimant, making both the claimant and insurer whole when a different remedy is maintained to its conclusion. ¶10 Accordingly, Section 5(I) should be read to allow the injured employee to preserve inconsistent remedies, but not allow recovery from both. This is consistent with both the statute and the supporting case law. In the present case, there has been no final resolution of the workers' compensation claim or the district court case. Pursuant to Pryse and Farley, Plaintiff has a choice of remedies and should be allowed to file a claim and preserve both until one reaches a conclusion. Therefore, dismissal is inappropriate in this case. FOOTNOTES 1 85A O.S. Supp. 2013, § 2(9)(a). 2 Title 85A, O.S. Supp. 2013, § 5(B)(2) states: B. Exclusive remedy shall not apply if: 2. The injury was caused by an intentional tort committed by the employer. An intentional tort shall exist only when the employee is injured as a result of willful, deliberate, specific intent of the employer to cause such injury. Allegations or proof that the employer had knowledge that the injury was substantially certain to result from the employer's conduct shall not constitute an intentional tort. The employee shall plead facts that show it is at least as likely as it is not that the employer acted with the purpose of injuring the employee. The issue of whether an act is an intentional tort shall be a question of law. 3 85A O.S. Supp. 2013, § 69(A)(1) provides: A claim for benefits under this act, other than an occupational disease, shall be barred unless it is filed with the Commission within one (1) year from the date of the injury. If during the one-year period following the filing of the claim the employee receives no weekly benefit compensation and receives no medical treatment resulting from the alleged injury, the claim shall be barred thereafter. For purposes of this section, the date of the injury shall be defined as the date an injury is caused by an accident as set forth in paragraph 9 of Section 2 of this act. (B) (1) In cases in which any compensation, including disability or medical, has been paid on account of injury, a claim for additional compensation shall be barred unless filed with the Commission within one (1) year from the date of the last payment of disability compensation or two (2) years from the date of the injury, whichever is greater. 4 85A O.S. Supp. 2013, § 69(A)(4): If a claim for benefits has been timely filed under paragraph 1 of this subsection and the employee does not: (a). make a good-faith request for a hearing to resolve a dispute regarding the right to receive benefits, including medical treatment, under this title within six (6) months of the date the claim is filed, or (b). receive or seek benefits, including medical treatment, under this title for a period of six (6) months,then on motion by the employer, the claim shall be dismissed with prejudice. 5 The phrase "maintain an action either in the Workers' Compensation Court or in the district court, but not both" has been part of previous statutes, namely 85 O.S.2011, § 302(I); 85 O.S. Supp. 2010, § 12(v). Prior to statutory codification, however, case law provided a remedy in district court for issues arising in tort as workers' compensation only covered accidental injury. See 85 O.S.1981, § 11; Thompson v. Madison Machinery Co., Inc., 1984 OK CIV APP 24, 684 P.2d 565. 6 Definition of maintain an action, https://thelawdictionary.org/maintain-an-action/ (last visited Feb. 6, 2023) ("term applies to the keeping going of a law suit to its final conclusion."). 7 Dyke v. Saint Francis Hosp., Inc., 1993 OK 114, 861 P.2d 295 ("the rule in Pryse in essence erects a res judicata bar, and precludes a party using a workers' compensation remedy and a District Court remedy to recover for the same on-the-job injury." (quotation omitted)). 8 This limitation on recovery can be seen in Thompson v. Madison Machinery Co., Inc., 1984 OK CIV APP 24, 684 P.2d 565, in which the COCA held that the plaintiff could maintain an action in district court and the workers' compensation court because the statute limited injuries to those that were accidental. The main issue was whether the actions of Plaintiff's employer/coworker amounted to a tort, which is a question of fact. The COCA held that summary judgment was improvidently granted because the controverted fact of whether the incident was accidental. and therefore fell under the auspices of the court, was a question of fact and needed to be decided. Id. ¶ 26, 684 P.2d at 570. Plaintiff was allowed to maintain both claims until the district court decided whether the employer had committed an intentional tort against Plaintiff. Id. ¶ 26--27, 684 P.2d at 570.

df465015-f4e7-44e9-8f7c-e90f9da3cf5f

Tres C, LLC v. Raker Resources

oklahoma

Oklahoma Supreme Court

TRES C v. RAKER RESOURCES2023 OK 13Case Number: 118650Decided: 02/14/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. TRES C, LLC, Plaintiff/Respondent, v. RAKER RESOURCES, LLC; CONTINENTAL RESOURCES, INC.; and DEWBLAINE ENERGY, LLC, Defendants/Petitioners. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 This appeal concerns the trial court's judgment after a bench trial that granted Plaintiff/Respondent's petition to cancel Defendants/Petitioners' oil and gas lease and to quiet title in its favor so that a third party can exercise the option of executing a new lease. The Court of Civil Appeals conditionally affirmed the trial court's judgment, but remanded the matter with instructions to address the noncontractual defense of obstructions, which is set forth in Jones v. Moore, 1959 OK 23, ¶ 0, 338 P.2d 872, 873. We granted certiorari to address whether the trial court erred in applying a rule of law that analyzed only a 3-month window of time for assessing whether a dip in the existing well's production was a cessation of production in paying quantities such that Defendants/Petitioner's lease expired by its own terms. On de novo review, we find that the trial court did err insofar as it relied upon the lease's cessation-of-production clause to define the time period for assessing profitability. We vacate the Court of Civil Appeals' opinion, reverse the trial court's judgment, quiet title in favor of Defendants/Petitioners, and remand the case for further proceedings not inconsistent with this opinion. OPINION OF THE COURT OF CIVIL APPEALS VACATED; JUDGMENT OF THE DISTRICT COURT REVERSED; CASE REMANDED FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION. Jana L. Knott, BASS LAW, Oklahoma City, Oklahoma; and Travis P. Brown, Cody J. McPherson, and Scott R. Verplank, MAHAFFEY & GORE, P.C., Oklahoma City, for Plaintiff/Respondent. Harvey D. Ellis and Andrew E. Henry, CROWE & DUNLEVY, Oklahoma City, Oklahoma, for Defendants/Petitioners. Jennifer Schnell Kaiser, CONTINENTAL RESOURCES, INC., Oklahoma City, Oklahoma, for Defendant/Petitioner Continental Resources, Inc. COMBS, J.: FACTUAL AND PROCEDURAL BACKGROUND ¶1 Plaintiff/Respondent Tres C, LLC (hereinafter "Tres C") is an Oklahoma limited liability company whose members are Viola "Tincy" Cowan, her son David Cowan, her daughter Karlea Cowan Ewald, her grandson Scot Meier, and her granddaughter Marsha Bukowski.1 Tres C is a successor-in-interest to certain mineral interests in the 320-acre lot contained in the northern half of Section 35, Township 15 North, Range 13 West (i.e., N/2 of 35-15N-13W in abbreviated form) of Blaine County, Oklahoma, that were formerly owned by the parents of Tincy's late husband, George and Coral Cowan.2 ¶2 In February of 1955, George and Carol Cowan, executed an oil and gas lease in favor of J.J. Wright (hereinafter "the Lessee") concerning those mineral interests in Section 35-15N-13W of Blaine County (hereinafter "the Cowan Lease").3 Under its habendum clause, the Cowan Lease would remain valid for a primary term lasting 10 years and then--so long as a producing well was drilled--for a secondary term lasting "as long thereafter as oil, gas, casinghead gas, casinghead gasoline, or any of the products covered by this lease is or can be produced."4 The Cowan Lease also contained a cessation-of-production clause providing: If within the primary term of this lease, production on the leased premises shall cease from any cause, this lease shall not terminate provided operations for the drilling of a well shall be commenced before or on the next ensuing rental paying date; or, provided lessee begins or resumes the payment of rentals in the manner and amount hereinbefore provided [in Paragraph 5 of the Cowan Lease]. If, after the expiration of the primary term of this lease, production on the leased premises shall cease from any cause, this lease shall not terminate provided lessee resumes operations for drilling a well within sixty (60) days from such cessation, and this lease shall remain in force during the prosecution of such operations and, if production results therefrom, then as long as production continues.5 In 1965 during the primary term of the Cowan Lease, Sun Oil Company (a former successors-in-interest to the Lessee) drilled and completed the G.D. Cowan No. 1 Well (hereinafter "the Cowan Well") into the Morrow formation in the northwest quarter (NW/4) of Section 35-15N-13W.6 The Cowan Well produced oil and gas in paying quantities, and the Cowan Lease moved into the secondary term defined by the habendum clause shortly after completion. ¶3 Defendants/Petitioners are the Lessee's current successors-in-interest under the Cowan Lease.7 In April of 2009, DMS Oil Company (hereinafter "DMS Oil")--acting through its vice president, Gary Raker--purchased both the Cowan Well and an assignment of all leaseholds in Section 35-15N-13W from the Kaiser-Francis Oil Company (another former successor-in-interest to the Lessee) for $35,000.8 Less than a year later in March of 2010, DMS Oil assigned all of its Section 35-15N-13W leasehold rights outside of the wellbore for the Cowan Well to Defendant/Petitioner Continental Resources, Inc. (hereinafter "Continental Resources") in exchange for approximately $500,000 and a 7.5% overriding royalty (ORR) interest in any future well drilled by Continental Resources.9 Then, in March of 2012, Gary Raker formed his own company, Defendant/Petitioner Raker Resources, LLC (hereinafter "Raker Resources"); and that company bought out DMS Oil Company's interest in the Cowan Well the very next month.10 Thus, for purposes of this appeal, Raker Resources is the operator of the Cowan Well.11 Defendant/Petitioner DewBlaine Energy, LLC (hereinafter "DewBlaine Energy") is a Delaware limited liability company under the control of a South Korean parent company, and it is engaged in a joint venture with Continental Resources for oil and gas exploration in the Woodford formation in an area of mutual interest (AMI) that covers portions of Dewey, Blaine, Custer, and Caddo Counties.12 Thus, Continental Resources' ability to drill a well in Section 35-15N-13W was only limited by Raker Resources exclusive rights in the Morrow formation and by DewBlaine Energy's 49.9% interest in the Woodford formation.13 ¶4 When DMS Oil first acquired the Cowan Well in April of 2009, the well was producing, but at low rates.14 Nevertheless, Mr. Raker was convinced that the well could be revived because it had good pressure.15 Through his supervision of operations, production increased by at least twenty-fold within the first year.16 ¶5 Things continued as normal until early 2016, when Tres C's royalty checks from Raker Resources allegedly began to arrive sporadically.17 That's when Tres C hired its first set of lawyers from Tisdal & O'Hara. On March 30, 2016, Tres C's lawyer sent Raker Resources a letter claiming the "relevant production records . . . evidence that the GD Cowan No. 1 well has long since ceased producing in paying quantities . . . . [and that] the captioned Lease has expired by its terms" and "demand[ing] that the well be plugged and abandoned, the surface restored to its original condition and the captioned Lease be released of record within 30 days of your receipt of this letter."18 Because of the demand letter, Raker Resources reduced the pumper fee by $100 per month in order to reduce the Cowan Well's expenses and to maintain its production in paying quantities.19 Raker Resources then sent a response to Tres C's attorney on April 11th, ensuring him that "the well has indeed been producing in paying quantities" and enclosing figures showing the amount of gas production for each month since January of 2012.20 Those figures demonstrated a dip in production in December of 2015, but nothing beyond the pale for the reported years.21 Two weeks later, Raker Resources also notified Continental Resources of Tres C's demand letter; informed Continental Resources that the Cowan Well "makes more revenue than costs, but not a whole lot more"; and asked whether Continental Resources had any plans to protect its leasehold interests in Section 35-15N-13W by drilling a new well or by purchasing the Cowan Well and taking control of its operations.22 On June 14th, Tres C's lawyer sent Raker Resources a follow-up letter asking that it produce "documentation evidencing the wells [sic] costs and revenue from January 2012 to the current date . . . . in their native format as they are kept in the normal course of business within 45 days of your receipt of this letter."23 On July 15th, Raker Resources notified Continental Resources of Tres C's second demand letter.24 Then three days later, Raker Resources sent a response to Tres C's lawyer enclosing the Cowan Well's costs and revenues from April 2012 to June 2016.25 Raker's documentation showed the same pattern as the gas production figures but further revealed that the dip in production during December of 2015 had in fact been unprofitable.26 ¶6 After the December 2015 dip in production, the Cowan Well became profitable again, but--as Mr. Raker had informed Continental Resources--not too profitable. In January of 2016, Raker Resources began seeing the production of some fluid; and as early as May of 2016, Raker Resources observed occasional spikes in pressure readings at the Cowan Well.27 To the extent the Cowan Well was having any issues with gas production, Mr. Raker blamed the increased line pressure and fluid buildup.28 Then in September of 2016, the Cowan Well experienced another month of low production and unprofitability.29 Throughout October of 2016, the line pressure started steadily creeping up from 50 to 70 pounds,30 until the Cowan Well failed to produce anything on October 14th and 15th.31 ¶7 Raker Resources was very proactive in trying to address these production problems. In February of 2016, Raker Resources started using more soap in its operations of the Cowan Well in an attempt to aerate the fluid and make it easier to expel.32 Then in August, Raker Resources attempted "rocking the well" back and forth between the coil tubing and the annulus (i.e., the space between the coil tubing and the casing) to force the fluid up.33 After September proved to be unprofitable, Raker Resources decided to move a compressor that it already owned from a nearby well to the Cowan Well in hopes that the compressor would help draw the fluid out of the wellbore.34 Raker Resources spent just over $9,000 to transport and install the compressor.35 On October 17th, Raker Resources shut off the Cowan Well's valve and began a two-and-a-half-week process of installing the compressor.36 Shortly thereafter, Raker Resources sent an e-mail to Continental Resources on October 22nd saying that "our Cowan well has quit producing due to high line pressure" and that Raker Resources "ha[d] moved a compressor in to attempt to renew production."37 Mr. Raker again asked whether "Continental Resources had any immediate plans for drilling on the unit."38 Raker Resources brought the Cowan Well back into operation on November 4th.39 By mid-November, the Cowan Well was back to producing 20 Mcf of gas per day,40 which had previously been over the benchmark for profitability.41 ¶8 Nevertheless, the Cowan Well's problems had not yet been completely resolved. In mid-November, the line pressure jumped to over 100 pounds of pressure, and the compressor never succeeded in drawing any fluid up out of the wellbore.42 Ultimately, October, November, and December of 2016 would prove to be unprofitable for the Cowan Well.43 ¶9 In the meantime, Tres C hired new attorneys at Andrews Davis, P.C. and became more active in pursuing termination of the Cowan Lease. On November 14th, Tres C entered into a lease option agreement with J&R Energy Resources, LLC (hereinafter "J&R Energy"), whereby J&R Energy would fund legal proceedings to secure the release, cancellation, or termination of the Cowan Lease in exchange for Tres C's promise to give J&R Energy an exclusive option to file a top lease at a later date.44 Moreover, if J&R Energy successfully terminated the lease and exercised its option to drill, J&R Energy would pay Plaintiff a signing bonus of $3,750 per acre (which translates to $1.2 million for Tres C's 320-acre tract).45 On November 22nd, Andrews Davis attorney Randy Smith, acting in his capacity as "agent/member" of J&R Energy, filed an Affidavit and Memorandum of Lease Option Agreement with the Blaine County Clerk's office.46 During that same week, Randy Smith also sent DewBlaine Energy a demand letter, but in his capacity as Tres C's lawyer.47 The letter claimed that the Cowan Lease had expired "based upon production data from the Oklahoma Tax Commission and the Oklahoma Corporation Commission," asked DewBlaine Energy to produce any evidence it possessed to the contrary, and demanded that DewBlaine Energy "remove the cloud from our clients' mineral estate by immediately releasing the Expired Lease . . . within ten (10) days from your receipt of this letter" or else Tres C would "be forced to seek a judicial determination that such lease has expired by its own terms."48 DewBlaine Energy notified Continental Resources about the new demand letter on December 5th.49 The very next day, Raker Resources received a telephone call from an attorney with Mahaffey & Gore, who claimed to "represent[] people who have a top-lease"--i.e., probably a reference to the entity who had a lease option, J&R Energy--on Tres C's mineral interests in Section 35-15N-13W.50 Counsel claimed the Cowan Well's "production was down" and threatened "to take [Raker Resources] to court to force [Raker Resources] to plug the well."51 Raker Resources promptly notified Continental Resources that afternoon about the phone call, the "top leases," and the threat of litigation.52 Raker Resources also informed Continental Resources about the status of production at the Cowan Well and asked whether "Continental Resources would be interested in buying [Raker Resources'] interest in the well in order to fight this thing."53 The threat of litigation made Raker Resources uncomfortable, even if it thought the Cowan Well still had the potential to produce more gas.54 ¶10 December 6th served as a turning point for Continental Resources and its plans for Section 35-15N-13W. Continental Resources' "senses were alerted or heightened" because "you take . . . threats from Mahaffey & Gore, from that firm[,] seriously."55 In follow-up conversations that day, Continental Resources told Raker Resources it would start having internal discussions about whether taking over the Cowan Well would make sense,56 at which point Raker Resources made a proposal to assign 3% of its 7.5% ORR back to Continental Resources if Continental Resources could spud a new well on or before January 31, 2017.57 What nobody except Continental Resources and DewBlaine Energy appreciated was the fact that those two entities had been taking steps since August of 2016 to drill a new well to be called the Orval #1-2-35XH well (hereinafter "the Orval Well") into Section 35 sometime in 2018--i.e., a two-mile horizontal well into the Woodford formation that would be spud in Section 2-14N-13W and that would stretch northward into Section 35-15N-13W.58 Those steps included sending on August 5th a well proposal to Section 2's working interest owners59; filing on August 24th both an application for pooling in Section 2 and two applications for drilling and spacing units covering certain formations under Sections 2 and 3560; and obtaining on October 7th an order from the Oklahoma Corporation Commission for the drilling and spacing unit on Section 35.61 After December 6th, however, Continental Resources began considering whether its plans could be altered for the sake of holding the leases on Section 35. ¶11 In short order, Continental Resources was able to shift its plans. On December 16th, the leader of Continental Resources' team circulated an internal e-mail laying out a plan to seek executive approval for drilling a 2-mile horizontal well by January 26, 2017.62 Besides shifting the drilling date, the proposal altered the previous plans as follows: (1) the well would be spud in the northeast quarter (NE/4) of Section 35, rather than in Section 2; (2) drilling would extend southward into Section 2, rather than northward into Section 35; (3) the Orval Well would be renamed as the Tres C FIU #1-35-2XH well (hereinafter "the Tres C Well") because of the change in the spud location to Tres C's land; and (4) the target formation would be the Meramec/Mississippian formation, instead of the Woodford formation.63 By shifting to a different formation, Continental Resources hoped to avoid delays caused by negotiations with DewBlaine Energy's lawyers in Houston and South Korea and delays caused by waiting for one of the joint venture's five or six drilling rigs that were needed for other projects, as a rig could instead be pulled from Continental Resources' regional STACK64 team.65 That same day, Continental Resources also made Raker Resources aware of its interest in the proposal that would reassign 3% of Raker Resources' 7.5% ORR back to Continental Resources, and asked Raker Resources again to send updated accounting statements,66 which Raker Resources forwarded later that afternoon.67 On December 21st, Continental Resources notified Raker Resources that, based on the agreed 3%-ORR assignment, its STACK team would be taking a well in for executive approval the next day with plans to spud the well in late January of 2017.68 ¶12 Thereafter, Continental Resources took steps to get the Tres C Well drilled. On December 21st, Continental Resources staked the proposed location for the new Tres C Well in the NE/4 of Section 35-15N-13W.69 A representative for Continental Resources met David Cowan at the site for the Tres C Well sometime in late December of 2016 or early January of 2017 to negotiate a surface damage agreement pursuant to the Oklahoma Surface Damages Act.70 Tres C initially resisted signing any surface damage agreement;71 but after Continental Resources filed a surface damage action on January 17, 2017,72 Tres C's attorneys worked out a settlement that resulted in dismissal of the surface damage action.73 On January 5th and 12th, Continental Resources authorized its STACK team to make expenditures for drilling either a multiunit well or a single-unit well in Section 35.74 On January 6th, Continental Resources filed applications with the Corporation Commission to drill the Tres C Well as a multiunit horizontal well and to get an exception on the well's location,75 and the OCC filed a public notice to set the matters for hearing on January 30th.76 On January 19th, Continental Resources began moving dirt to build the drilling pad for the Tres C Well.77 On January 27th, J&R Energy's attorneys at Mahaffey & Gore filed protests to Continental Resources' various applications pending before the Corporation Commission,78 which bumped the hearing date to February 28th.79 On February 3rd, Continental Resources sought an emergency hearing "because of contractual commitments and rig availability" that would allegedly require the well to be "drill[ed], test[ed], complete[d] and produce[d] . . . prior to" the new hearing date.80 The Corporation Commission held an emergency hearing on February 17th. Based on evidence presented at the emergency hearing that the rig would arrive on or about February 27th and that Continental Resources would suffer an estimated financial loss of $29,250 per day if drilling wasn't permitted, the Corporation Commission issued an Emergency Order granting Continental Resources authority to drill, test, and complete the multiunit Tres C Well with the location exception, but withholding authority to produce the well until after the final hearing.81 By February 17th, Continental Resources had also negotiated an acreage trade agreement that would allow them to obtain without protest a spacing unit in Section 2, such that Continental Resources could proceed with its plans to drill the multiunit well instead of a single-unit well.82 On February 23rd, the Corporation Commission issued a Permit to Drill allowing Continental Resources to commence drilling on the Tres C Well.83 As soon as the Corporation Commission's Emergency Orders were filed on March 9th, Continental Resources spud the Tres C Well, and the well was completed on July 29th at a cost of more than $9 million.84 ¶13 Having seen where things were going at the Corporation Commission, J&R Energy's attorneys at Mahaffey & Gore exercised their rights under the lease option agreement and filed this equitable quiet title action on Tres C's behalf on February 27, 2017.85 The Petition alleged that the Cowan Well had "ceased to produce in paying quantities" and that the Cowan Lease had therefore "expired by its own terms," such that a decree should be entered to terminate and cancel the Cowan Lease and Defendants/Petitioners' mineral interests and to "restrain[] and enjoin[ Defendants/Petitioners] from exercising and/or attempting to exercise any right or interest therein by reason of the Subject [Cowan] Lease."86 ¶14 A three-day bench trial eventually ensued in September of 2019. The parties presented seventy-four exhibits and the following seven witnesses: (1) Tincy Cowan; (2) David Cowan; (3) Gary Raker; (4) Continental Resources' corporate representative, Matthew Simmons; (5) Continental Resources' former employee, Justin Crooks; (6) Tres C's expert in the field of petroleum engineering, Aaron Anderson; and (7) Defendants/Petitioners' expert in the field of petroleum engineering, J.P. Dick. Testimony regarding the Cowan Well's production was predictably split along party lines. ¶15 On one hand, Tres C argued the Cowan Well had become unprofitable such that the Cowan Lease had expired. Both of Tres C's principals relied upon their expert's purported conclusion that the Cowan Lease expired in November of 2016.87 Yet when he was questioned, Tres C's expert testified that he was not asked to opine on whether the lease terminated.88 Instead, he only concluded that the Cowan Well did not produce in paying quantities in September, October, or November of 2016--i.e., that it ceased to produce in paying quantities in September of 2016.89 ¶16 On the other hand, the defense witnesses offered testimony to the effect that the Cowan Well maintained production, either through actual profitability or mere capability. Mr. Simmons testified that Continental Resources believed the Cowan Well was profitable during the months of September, October, and November of 2016.90 Gary Raker testified that he believed the Cowan Well was a "good producer" and "a profitable well" when he received the first demand letter in April of 2016; that it was a "good, capable producing well" when he received the second demand letter in June of 2016; that it had not lost its ability to produce when he had the compressor installed in October of 2016; that even after getting the allegedly threatening phone call from J&R Energy's attorney and seeking to entice Continental Resources to drill a new well in exchange for his return of a portion of the ORR interest in December of 2016, he was "still operating the well" because he thought the well's "capabilities . . . . were the same as they always had been" and "any day that thing could burp up some fluid and go back to producing"; and that in January and February of 2017 he was "still operating [the] well" because he "still believed the well was capable of producing if we could get the producing characteristics right . . . . [and] get the formula right."91 Mr. Crooks also testified that he believed the Cowan Lease was valid and that Raker Resources and Continental Resources still owned 100 percent of Section 35.92 Lastly, the defense expert testified--contrary to what Tres C's expert thought--that he wouldn't consider insurance costs or the one-time expenses related to transportation and installation of the compressor to be "lifting costs" and that he also wasn't sure whether the purchaser's low-volume or "meter" fees (i.e., fees that the purchaser charges the operator when the gas produced falls below a certain volume) should be considered "lifting costs."93 Thus, he concluded that the Cowan Well was profitable regardless of whether he looked at data for the 12-month period from December 2015 to November 2016, for the 12-month period from January 2016 to December 2016, or for the 12-month period from February 2016 to January 2017--or even at data for the 14-month period from January 2016 to February 2017 or for the 26-month period from January 2015 to February 2017.94 The defense expert did not think the 3-month period analyzed by Tres C's expert was adequate for determining whether the Cowan Well had become unprofitable;95 yet he also concluded that in looking at individual production months on a month-by-month basis, each production month from September of 2016 to February of 2017 was profitable except for October, November, and--depending upon whether the Court characterized the low-volume/meter fees as lifting costs--possibly September.96 To the extent the well was unprofitable during those months, the defense expert blamed "[t]he cumulative effect of increased line pressure and pressure spikes" that caused water loading for the "reduced . . . ability of the well to produce to its capability."97 Nevertheless, he maintained that the Cowan Well remained capable of producing in paying quantities during those three months.98 ¶17 But beyond testimony about the Cowan Well, the defense put on evidence regarding Continental Resources' drilling of the new Tres C Well in order to bolster its claim that the Cowan Lease was still valid. Mr. Crooks painstakingly testified about all the steps that Continental Resources took toward drilling a well in Section 35, as well as the substantial resources spent on drilling the Tres C Well.99 ¶18 Nearly four months later on January 17, 2020, the trial court issued its Journal Entry of Judgment canceling the Cowan Lease in favor of Tres C. The trial court found that "[t]he costs associated with installation of the compressor on the Cowan Well [we]re lifting costs" and that "[t]he low volume fees charged by the gas purchaser [we]re to be deducted from gross revenue in determining whether the well produces in paying quantities," but the trial court found "[t]he insurance expenses on the Cowan Well [we]re not lifting costs."100 Consequently, when comparing the Cowan Well's net revenues and lifting costs, the trial court found that, "[b]y September 2016, the Cowan well ceased to produce in paying quantities" because "lifting costs exceeded revenues from the Cowan Well in September, 2016 and in every month after."101 But the sweeping language about "every month after" September only refers to the subsequent two months of October and November, as demonstrated by the trial court's analysis of both experts' calculations for those months only and by its ultimate finding that "[t]he Cowan Well failed to produce in paying quantities for the production months of September, October and November of 2016."102 Alternatively, the trial court found that the Cowan Well was shut in on October 17, 2016, after two days of no production and that a cessation of production occurred because "[t]he Cowan Well was not producing in paying quantities immediately prior to being 'shut-in' by Raker on October 17, 2016."103 Having two bases for a cessation of production, the trial court further found that Raker Resources "did not restore production in paying quantities from the Cowan Lease within the 60 day grace period provided by the Cessation of Production Clause" and that Continental Resources "did not commence operations for the drilling of a new well on the Subject Lease during the grace period . . . . in time to perpetuate the Subject Lease under the terms of the Cessation of Production Clause" insofar as it "did not begin moving dirt for the building of the drilling pad for the new Tres C Well until January 19, 2017."104 Thus, the Cowan Lease "expired by its own terms after the Cowan Well failed to produce in paying quantities in September, October and November of 2016."105 Consequently, the trial court quieted title and entered judgment in favor of Tres C.106 ¶19 All three Defendants/Petitioners jointly filed a timely appeal of the trial court's judgment on February 14, 2020.107 In their appellate brief, Defendants/Petitioners narrowed the scope of their appeal down to two issues.108 First, they alleged "the lower court erroneously held 'production' ceases any moment profitability is interrupted, instead of analyzing profitability over a reasonable accounting period."109 Regarding this issue, their brief states the following: The main issue on appeal is to determine when "production" under the Habendum Clause ceases and the 60-day savings provision of the Cessation of Production Clause begins. Plaintiff contends this occurs any moment an interruption in actual, continuous profitable production occurs -- at which point(s) a lessee must immediately choose whether to commence drilling a new well or risk forfeiting its leasehold if profitable production does not resume within the savings period. Defendants contend the Habendum Clause remains in force and maintains the lease until there is a cessation of production in paying quantities for an unreasonable period of time gauged under all the circumstances from the perspective of a reasonable operator -- so a lessee need not undertake the burden of commencing a new well every time production dips below paying quantities.110 Second, Defendants/Petitioners alleged the trial court erred in failing to address "whether Plaintiff's demand for release of the Subject Lease in March, 2016, and/or its repeated demand in November 2016 accompanied by its recorded top-lease" would permit them to take advantage of the obstruction doctrine by suspending operations and relieving them of their duty to produce in paying quantities until resolution of the title challenge.111 With respect to both issues, Defendants/Petitioners claimed they were "seek[ing] review of the legal standard applied by the trial court" and that they were "not seek[ing] review of the trial court's factual determinations."112 ¶20 This Court denied a motion to retain the appeal and instead assigned the matter to Division IV of the Court of Civil Appeals (COCA).113 The COCA issued its opinion on June 8, 2021. Therein, the COCA avoided reaching the first issue. The COCA treated the trial court's finding that a cessation of production had occurred as a factual finding, rather than a legal conclusion, and then essentially characterized Defendants/Petitioners' assertion that they were not challenging any factual findings as a waiver of the first issue on appeal: In their Brief at page 14, Raker and Continental stated: Defendants do not seek review of the trial court's factual determinations in this lease cancellation suit. Defendants seek review of the legal standards applied by the trial court, including specific standards set forth in Hall v. Galmor, 2018 OK 59, 427 P.3d 1052. The trial court made extensive fact findings, all of which are admitted and now established. . . . . . . . . . . The Cowan Well ceased to produce in paying quantities in September 2016 and every month thereafter. . . . The trial court specifically found that the Cowan Well failed to produce in paying quantities for September, October and November 2016. . . . . The Cowan Lease is clear. The facts are established and not challenged. There was a cessation of production. Raker and Continental had sixty days to remedy the cause of the cessation of production or drill a new well. They did neither. Absent an additional, noncontract related defense, the Cowan Lease expired. The trial court did not err applying the facts to the Cowan Lease contract . . . .114 Nevertheless, the COCA found that the trial court "left unaddressed the noncontractual defense of obstruction" and determined that the case should be remanded for the trial court to pass upon the defense as a matter of first instance.115 Consequently, the COCA "conditionally affirmed" the trial court's judgment "on the condition that the trial court finds against the defendants on their obstruction defense on remand."116 ¶21 On June 25, 2021, Defendants/Petitioners filed a petition for writ of certiorari, seeking this Court's review of whether the trial court erred in finding a cessation of production based upon a narrow 90-day window. This Court granted certiorari on January 31, 2022. STANDARD OF REVIEW ¶22 This quiet title action is a matter of equitable cognizance. See Hall, 2018 OK 59, ¶ 11, 427 P.3d at 1061 (citing Smith v. Marshall Oil Corp., 2004 OK 10, ¶ 8, 85 P.3d 830, 833; Hininger v. Kaiser, 1987 OK 26, ¶ 10, 738 P.2d 137, 141; Cotner v. Warren, 1958 OK 208, ¶ 5, 330 P.2d 217, 219; Henry v. Clay, 1954 OK 170, ¶ 12, 274 P.2d 545, 548). In equitable cases like this, issues of fact are reviewable under the clearly-against-the-weight-of-the-evidence standard, but issues of law are reviewable under the de novo standard. Id. ¶¶ 12--13, 427 P.3d at 1061. Thus, factual findings "will not be set aside unless, after a consideration of the entire record, it appears that such findings are clearly against the weight of the evidence." Id. ¶ 12, 427 P.3d at 1061 (quoting Briggs v. Sarkeys, Inc., 1966 OK 168, ¶ 29, 418 P.2d 620, 624). But we possess "plenary, independent, and non-deferential authority to reexamine a trial court's legal rulings." Id. ¶ 13, 427 P.3d at 1061 (quoting State ex rel. Dep't of Human Servs. v. Baggett, 1999 OK 68, ¶ 4, 990 P.2d 235, 238). ANALYSIS AND REVIEW ¶23 The issue before this Court is whether it was legal error for the trial court to apply a rule of law that analyzed only a 3-month window of time for assessing whether the Cowan Well had experienced a cessation of production in paying quantities such that the Cowan Lease expired by its own terms. Stated more broadly, the issue concerns how to determine whether production that maintains a gas lease under the habendum clause has ceased, including whether the cessation-of-production clause plays any role in narrowing the window of time that should be considered in making such a determination. ¶24 Defendants/Petitioners contend that "whether a well remains capable of production and thus perpetuates the lease under the habendum clause is assessed over a reasonable look-back period of time sufficient to consider whether a prudent operator would continue or abandon operations."117 They argue that the 60-day savings period in the Cowan Well's cessation-of-production clause does not come to bear until a longer look-back period (the length of which can only be gauged in light of all the equitable circumstances) demonstrates that a cessation--not merely an interruption--of profitable production has occurred.118 Otherwise, "the savings period of a cessation of production clause is always engaged, so that a lessee must constantly evaluate the need to commence a new well to save its lease upon every interruption of profitable production" and must "constantly monitor production on a daily basis and be prepared to take action if production from any single day resulted in a loss"--a tenet which Defendants/Petitioners characterize as "contrary to Oklahoma law, and wholly unworkable for the oil and gas industry" insofar as it "imposes new, economically unworkable burdens on the Oklahoma oil and gas industry."119 To the extent that the COCA failed to address this issue of law on appeal, Defendants/Petitioners argue its opinion affirming the trial court's judgment "disregard[ed] this Court's precedents" in Stewart v. Amerada Hess Corp., Pack v. Santa Fe Minerals, and Hall v. Galmor120; was "contrary to the preeminent treatise on oil and gas law regularly relied upon by this Court"121; and was in conflict with Blair v. Natural Gas Anadarko Co., 2017 OK CIV APP 57, 406 P.3d 580.122 ¶25 Tres C counters that this Court cannot endorse Defendants/Petitioners' "reasonable look-back period" because the Cowan Lease's bargained-for cessation-of-production clause controls over the common law temporary cessation doctrine and gives Defendants/Petitioners only 60 days in which to restore production in paying quantities.123 Tres C argues that Defendants/Petitioners "seek to overturn decades of this Court's precedent" and point us to the cases of Hoyt v. Continental Oil Co., French v. Tenneco Oil Co., and Hall v. Galmor.124 Tres C also attempts to distinguish the Pack and Blair cases on the basis that the parties therein had stipulated the wells at issue were capable of production in paying quantities, whereas the Cowan Well's capability was disputed.125 Thus, according to Tres C, the "COCA correctly rejected [Defendants/Petitioner]s' arguments, and instead, based on the applicable teachings of Hoyt, French, and Hall found that the lease had expired pursuant to its terms due to a cessation of commercial production far in excess of 60 days."126 ¶26 Upon de novo review of the parties' proffered cases and arguments concerning this legal issue, we conclude that the trial court erred in determining that a cessation of production occurred based on Tres C's evidence that the Cowan Well was unprofitable for the three months of September, October, and November of 2016. Even if all the evidence--including the testimony of Tres C's expert, the calculations of the defense expert, and the admission of the operator, Gary Raker-- tends to show that the Cowan Well was operating at a loss during those three months, that period of time is, as a matter of law, too short for determining whether a cessation of production in paying quantities has occurred. ¶27 Tres C's and the trial court's reliance upon the cessation-of-production clause to establish a 3-month time period for assessing whether the well has lost its profitability such that a "cessation" has occurred is misplaced for several reasons. ¶28 First, we have repeatedly explained that the cessation-of-production clause is only implicated where production has already ceased--i.e., the clause only comes into play after a cessation has occurred. See Hall, 2018 OK 59, ¶ 36, 427 P.3d at 1068; Pack, 1994 OK 23, ¶ 16, 869 P.2d at 328; accord 4 Kuntz, supra note 121, § 47.3(a)(1) (discussing the "[p]urpose and effect" of a cessation-of-production clause and stating "the clause is not activated and the prescribed period within which operations must be commenced does not begin to run until production in paying quantities has ceased under the test applied to the habendum clause"); 2 Kuntz, supra note 121, § 26.6 ("[I]f the 'production' requirement of the habendum clause is met, the cessation-of-production clause is not triggered." (citing Hall, 2018 OK 59, ¶ 36, 427 P.3d at 1068)). That is why we have repeatedly characterized the cessation-of-production clause as a "savings clause" that defines the grace period for reestablishing production in paying quantities through the means specified within the clause (e.g., the commencement of drilling operations for a new well, the commencement of operations to rework an old well, etc.). Hall, 2018 OK 59, ¶¶ 35--36 & n.84, 427 P.3d at 1067--68 & n.84; Pack, 1994 OK 23, ¶ 16, 869 P.2d at 328; French, 1986 OK 22, ¶ 8, 725 P.2d at 277 (quoting Hoyt, 1980 OK 1, ¶ 10, 606 P.2d at 563). Like a savings statute that kicks in after the applicable statute of limitations has expired and gives the plaintiff an extension of time for refiling a lawsuit, see, e.g., 12 O.S.2011, § 100,127 the cessation-of-production clause kicks in after a cessation has occurred that could result in termination of an oil and gas lease under the habendum clause and gives the operator an extension of time for preserving the lease through the means specified in the clause. Therefore, the cessation-of-production clause and the 60-day time period contained therein have no bearing on anything that is done before the cessation occurs, including the assessment of whether a cessation has occurred. ¶29 Second, we agree with Defendants/Petitioners and their treatise that "[i]t is not the purpose of the cessation of production clause to establish an accounting period for purposes of determining if production is in paying quantities." 4 Kuntz, supra note 121, § 47.3(a)(1); accord Clifton v. Koontz, 325 S.W.2d 684, 690 (Tex. 1959) (" . . . however, if production never ceased, as is the case here, the 60-day clause is not definitive of the period over which the trier of the facts must determine whether a lease is producing in paying quantities"). Otherwise, leasehold operators subject to a 60-day cessation-of-production clause (like Defendants/Petitioners) would be required to commence drilling operations immediately upon sustaining a slight loss for one month without regard to whether they believed the next month's production might be profitable, because another month of slight loss could result in forfeiture of the lease. Such a result would be wholly unworkable in the oil and gas industry. Furthermore, if this Court used the cessation-of-production clause to establish a 3-month accounting period, we would indubitably burden leasehold operators with a duty to market continually in order to maintain the profitable production necessary to sustain the lease. Yet this Court rejected the imposition of such a duty under the cessation-of-production clause in the Pack case: The lessors/mineral interest owners argue the term "production" used in this [cessation-of-production] clause includes removal and marketing of the product. They would require the lessee to continually market the gas from the well, and any cessation of such marketing for a period of sixty days or more would result in termination of the lease. We cannot accede to such a constrained construction of the clause as it discounts the intended meaning of production as this Court has determined in numerous cases. . . . . . . If we were to conclude that the term "production" as used in the cessation of production clause means removal and marketing of the product as the mineral interest owners assert, . . . . [a]ny cessation of marketing for a sixty day period, under the lessors' interpretation of the clause, would constitute a violation of the clause resulting in termination of the lease. Such a result ignores the express terms of the habendum clause which provide for the lease to continue after the primary term as long as the well is capable of production in commercial quantities regardless of marketing. . . . . Thus, the clause does not require the lessee to market oil or gas actually extracted from the well. If the well was capable of production in commercial quantities at all times, but for a short period had less than commercial quantities marketed from it, the lessors would require the lessees to begin drilling operations for another well that under the facts would be unnecessary and uneconomical. Pack, 1994 OK 23, ¶¶ 14--15, 17, 869 P.2d at 327--29; see also Voiles v. Santa Fe Minerals, Inc., 1996 OK 13, ¶¶ 9--10, 911 P.2d 1205, 1208--09 (stating that the Pack case explained "that a lease capable of producing in paying quantities will not terminate under that [i.e., the cessation-of-production] clause for a failure to market gas for a sixty-day period" and concluding that there was no appetite for overruling Pack). Thus, in order to avoid unwanted results, we must steer clear of using the cessation-of-production clause to define a specific accounting period for determining whether production has been in paying quantities. ¶30 Instead, our case law provides that, when an appellate court is reviewing whether "the period employed by the trial court to determine profitability was sufficient," "the appropriate time period is not measured in days, weeks or months, but by a time appropriate under all of the facts and circumstances of each case." Barby v. Singer, 1982 OK 49, ¶ 6, 648 P.2d 14, 16--17; accord Texaco, Inc. v. Fox, 618 P.2d 844 (Kan. 1980) (observing that "it is generally accepted that profitability on an oil and gas lease should be determined over a relatively long period of time in order to expose the operation to the leveling influences of time," discussing the downfalls of using time periods that are too short or too long, and holding that "[t]he better rule precludes the use of a rigid fixed term for determination of profitability and uses a reasonable time depending upon the circumstances of each case, taking into consideration sufficient time to reflect the current production status of the lease"); Clifton v. Koontz, 325 S.W.2d 684, 690 (Tex. 1959) (stating that "there can be no limit as to time, whether it be days, weeks, or months, to be taken into consideration in determining the question of whether paying production from the lease has ceased" and saying that "the trial court necessarily must take into consideration all matters which would influence a reasonable and prudent operator," including "a reasonable period of time under the circumstances"); see also 2 Kuntz, supra note 121, § 26.7(u) (generally discussing the "[p]eriod of time taken into account" for determining "[w]hat constitutes paying quantities"). This Court has repeatedly approved the use of reasonably lengthy accounting periods in assessing the profitability of a well's production. In the case of Barby v. Singer, 1982 OK 49, 648 P.2d 14, this Court affirmed the trial court's use of a 14-month period to assess profitability. Id. ¶ 6, 648 P.2d at 16. In the case of Smith v. Marshall Oil Corp., 2004 OK 10, 85 P.3d 830, this Court found that the 3-year "period employed by the trial court in the instant case, to measure the Stacy and Paige wells' profitability, was sufficient under all the facts and circumstances for a fair and reasonable determination." Id. ¶¶ 11, 14, 85 P.3d at 834--35. In the case of Henry v. Clay, 1954 OK 170, 274 P.2d 545, this Court considered the subject well's production over a 32-month period--or as Defendants/Petitioners' proffered treatise characterized it, "the entire productive history of the lease," see 2 Kuntz, supra note 121, § 26.7(u) & n.85--and found that a $46.15 deficit was no reason for "forfeit[ure] of his [i.e., the operator's] entire investment therein" simply because "the total cost of production at any particular time slightly exceed[ed] the actual returns to him." Henry, 1954 OK 170, ¶ 11, 274 P.2d at 547--48. Each of these cases demonstrate that the reasonable amount of time needed for assessing a well's profitability and for determining whether a cessation has occurred is typically much longer than 3 months. ¶31 Tres C argues that language from the Hoyt, French, and Hall cases mandates the time period set forth in the cessation-of-production clause will override any common-law requirement to utilize a reasonable time period. The language at issue states: Where the parties have bargained for and agreed on a time period for a temporary cessation clause that provision will control over the common law doctrine of temporary cessation allowing a "reasonable time" for resumption of drilling operations, Hoyt, 1980 OK 1, ¶ 10, 606 P.2d at 563--64 (emphasis added), quoted in French, 1986 OK 22, ¶ 7, 725 P.2d at 277, and: [A]ppellants contend that a determination of cessation of production paying quantities is dependent upon the selection of a proper time frame within which to base that calculation. Intertwined with these points is the contention that the 60-day period for resumption of operations specified in the lease does not become activated until the expiration of a reasonable period of time, thus giving the lessee a reasonable time to resume operations plus 60 days. Appellants' contention that a 60-day cessation clause is time in addition to a reasonable time for resumption of drilling is not well taken in light of the express language of Hoyt v. Continental Oil, supra, at p. 563, French, 1986 OK 22, ¶ 7, 725 P.2d at 276--77 (emphasis added), and: Where the law (by operation of the temporary cessation doctrine) would ordinarily give a lessee a "reasonable" amount of time in which to restore production, the cessation-of-production clause substitutes a bargained-for period of time that cannot be altered by any court's notion of reasonableness. Hall, 2018 OK 59, ¶ 35, 427 P.3d at 1067 (emphasis added). Tres C assumes that the "reasonable amount of time" that is permitted under the temporary cessation doctrine encompasses both the period of time that a court would look at to assess whether a cessation has occurred and the period of time allowed for resumption of operations after the cessation has occurred. Thus, by extension, Tres C wants this Court to recognize the cessation-of-production clause as a substitute for both periods of time, thereby limiting the period of time for assessing profitability to 60 days and, in the event such circumscribed data demonstrates unprofitability, leaving no time for resumption of drilling operations. ¶32 Such arguments are unconvincing for three reasons. ¶33 First, the quoted language from Hoyt, French, and Hall undermines Tres C's position insofar as it discusses the time "for resumption of drilling operations" or for "restor[ation of] production." The language clearly presupposes that a cessation has already occurred; otherwise there would be no need to resume drilling or reworking. Nothing illustrates this more clearly than the quoted language from the French case, where the Court characterized the issue before it in terms of whether the lessee would receive "a reasonable time . . . plus 60 days" in order "to resume operations." The French Court did not characterize the issue in terms of whether the lessee would have a reasonable time to assess profitability and then, if the well proved unprofitable such that production had ceased, get 60 days more to resume operations--which is the issue in this case. Looking at the quoted language alone, it would seem that both the cessation-of-production clause and the temporary cessation doctrine only come into play after a cessation has occurred. The name of the doctrine also bolsters the notion that it is triggered by a "cessation," albeit a "temporary" one. Thus, neither the cessation-of-production clause nor the temporary cessation doctrine have anything to do with the reasonable time period that governs the pre-cessation assessment of profitability. ¶34 Second, despite the quoted language from the Hoyt, French, and Hall cases, the cessation-of-production clause was never designed to eliminate or to avoid the operation of the temporary cessation doctrine as Tres C argues. Defendants/Petitioners' proffered treatise perhaps says it best: It is possible for the literal provisions of the various forms of the dry hole clause and cessation of production clause to be construed to prevent the application of the doctrine of temporary cessation of production. The period of time within which operations must be commenced has been treated as a contractual definition of temporary cessation [citing Hoyt and French, along with cases from other jurisdictions]. . . . . . . . An indiscriminate application of such rule can, however, lead to results that the parties were not likely to have intended when they included such a clause in the lease. A typical clause that combines the dry hole clause and cessation of production clause may vary as to the period of time allowed, but it will contain language that is the same or similar to the following language: "If prior to the discovery oil or gas, lessee should drill a dry hole or holes thereon, or if after the discovery of oil or gas in paying quantities, the production thereof should cease from any cause, this lease shall not terminate if the lessee commences additional drilling or reworking operations within thirty days thereafter or (if it should be in the primary term) commences additional drilling operations or resumes the payment of rentals. . . ." The fact that the event which is designed to prevent termination is the commencement of drilling or reworking operations gives some indication of the purpose of the clause and the intention of the parties. It indicates that the parties are concerned with a situation where cessation of production is of the type that is remedied by drilling or reworking operations. Thus, the parties must have intended that the clause would become operative if a dry well is drilled or if a producing well ceases to be capable of producing in paying quantities. A literal application of the clause to every temporary cessation of production could lead to absurd results. Thus, if the marketing of production should be interrupted because of a rupture of the purchaser's pipeline, it is not likely that the parties intended that the lease could be preserved only by commencing drilling or reworking operations on the lease, when such operations would not correct the difficulty. The problem is not a great one in a jurisdiction such as Oklahoma, where marketing is not required for production, because, by definition, production would not have ceased. . . . The doctrine of temporary cessation of production is a practical necessity, because oil and gas are never produced and marketed in a continuous, uninterrupted operation that goes on every hour of the day and night. Once it is recognized that any brief interruption in the operation must be tolerated as a practical matter, it becomes necessary to adopt a doctrine that permits temporary cessations of production. The resumption of operations clause [i.e., a short-hand reference to the combined dry hole clause and cessation-of-production clause] was never designed to eliminate or to avoid the operation of such doctrine or to require that oil or gas be produced and marketed in a continuous, uninterrupted operation. It was intended to preserve a lease in order to permit a lessee to restore production if production should cease under circumstances that require drilling or reworking on his part in order to restore production. Accordingly, it would be more reasonable to construe the resumption of operations clause so that the clause "or if after the discovery of oil or gas in paying quantities, the production thereof should cease from any cause" refers not to the temporary cessation of production, but to a cessation of production that would be permanent unless corrected by reworking or drilling operations. 2 Kuntz, supra note 121, § 26.13(b) (emphasis added) (footnotes omitted); see also 4 Kuntz, supra note 121, § 47.3(a) ("It is submitted that, regardless of the location of the clause, it would be more reasonable to construe the cessation of production clause so that the provision 'or if after the discovery of oil or gas in paying quantities the production thereof should cease from any cause' refers not to a temporary cessation of production but to a cessation of production that would be permanent unless corrected by reworking or drilling operations."). In the case before us, the event which can prevent termination under the Cowan Lease's cessation-of-production clause is the "resum[ption of] operations for drilling a well within sixty (60) days from such cessation."128 This indicates that the parties intended the clause to become operative only if the "cessation" was permanent, as only a permanent cessation would require the remedy of drilling a new well. But Tres C argues in favor of utilizing the clause under very different circumstances, where the operator, Raker Resources, was still in the process of testing whether the Cowan Well's pressure and fluid build-up problems could be remedied by the installation of a compressor or by the downhole utilization of more soap.129 Such a temporary interruption in profitable production should not trigger the 60-day time limit in the cessation-of-production clause--particularly insofar as that clause was really designed to provide a grace period for protecting Defendants/Petitioners' leasehold interests, see supra ¶ 28, and in light of the strong policy of our statutory law against forfeiture of estates as embodied in 23 O.S.2011, § 2, see Stewart v. Amerada Hess Corp., 1979 OK 145, ¶ 10, 604 P.2d 854, 858. Additionally, even if our rule requiring us to look at a reasonable time period when determining profitability did emanate from the temporary cessation doctrine--which it does not--the cessation-of-production clause's 60-day time limit need not serve as a basis for eliminating or avoiding the reasonable time period. ¶35 Lastly, Tres C's reliance upon the Hoyt and French cases is misguided insofar as this Court has previously distinguished those cases in a way that limits their applicability to situations where the subject wells are incapable of producing when the primary term of the lease expires and are thus unable to produce during the secondary term. See Pack, 1994 OK 23, ¶ 18, 869 P.2d at 329. As the Cowan Well was producing far into the secondary term of the Cowan Lease and was arguably still capable of production in paying quantities, Hoyt and French are inapposite. CONCLUSION ¶36 We conclude the trial court erred when it relied upon the cessation-of-production clause to establish a 3-month time period for assessing whether a cessation of production in paying quantities had occurred. ¶37 The judgment of the trial court is reversed. Had the trial court applied the appropriate rule of law and analyzed the Cowan Well's profitability over "a time [period] appropriate under all of the facts and circumstances," Barby, 1982 OK 49, ¶ 6, 648 P.2d at 16--17, judgment should have been entered in favor of Defendants/Petitioners by reason of Plaintiff's failure to carry their burden of proof. The evidence presented and relied upon by the trial court established that the Cowan Well was not producing in paying quantities for a period of three months,130 but three months is not an appropriate time period under all of the facts and circumstances of this case, particularly in light of the operator's efforts to remedy the dip in production.131 An additional basis to reverse the trial court's judgment arises from its back-dating the erroneously found cessation to September 1, 2016,132 which effectively served to deprive Defendants/Petitioners of the 60-day grace period afforded in the cessation-of-production clause. Any cessation would have commenced on December 1, 2016, at the close of the three-month period used to assess profitability; and Continental Resources' commencement of drilling operations on January 19, 2017, would have maintained the Cowan Lease under the cessation-of-production clause. Despite the fact that the cessation-of-production clause has no bearing on the accounting period, the facts of this case demonstrate that the goal of that clause was realized when Continental Resources drilled a more productive well. Production benefits the operator (Continental Resources), the overriding royalty owner (Raker Resources), and the royalty owner (Tres C); and that goal has been accomplished. We hereby quiet title in favor of Defendants/Petitioners Raker Resources, LLC; Continental Resources, Inc.; and DewBlaine Energy, LLC. Because we vacate the Court of Civil Appeals' opinion and reverse the trial court's judgment, the trial court need not address the noncontractual defense of obstruction as that issue is now moot. OPINION OF THE COURT OF CIVIL APPEALS VACATED; JUDGMENT OF THE TRIAL COURT REVERSED; CASE REMANDED FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION. KANE, C.J., and KAUGER, WINCHESTER, EDMONDSON, COMBS, GURICH, DARBY, and KUEHN, JJ., concur. ROWE, V.C.J., concurs in result. FOOTNOTES 1 ROA p.000595, Trial Tr. vol. I, 41:25--42:7, Sept. 24, 2019; ROA p.000573, Journal Entry of J. ¶ 1, at 1. 2 ROA p.000595, Trial Tr. Vol. I, 42:8--44:21; ROA p.000573, Journal Entry of J. ¶ 2, at 1. 3 ROA p.000598, Jt. Trial Ex. 117, Oil & Gas Lease 1; ROA pp.000573--000574, Journal Entry of J. ¶ 4, at 1--2. 4 ROA p.000598, Jt. Trial Ex. 117, Oil & Gas Lease ¶ 2, at 1; ROA p.000574, Journal Entry of J. ¶ 8, at 2. 5 ROA p.000598, Jt. Trial Ex. 117, Oil & Gas Lease ¶ 13, at 1 (emphasis added); see also ROA p.000574, Journal Entry of J. ¶ 9, at 2 (quoting only the second sentence). 6 Id., Jt. Trial Ex. 1, Okla. Corp. Comm'n Well Record (Form 1002A) 1; ROA p.000596, Trial Tr. vol. II, 239:4--:17 (testimony of defense expert J.P. Dick); ROA p.000574, Journal Entry of J. ¶ 5, at 2. 7 ROA p.000573, Journal Entry of J. ¶ 4, at 1. 8 ROA p.000598, Jt. Trial Ex. 2, Transfer of Operator (Form 1073) 1; ROA p.000595, Trial Tr. vol. I, 83:3--84:4 (testimony of Gary Raker). 9 See ROA p.000595, Trial Tr. vol. I, 84:5--:21 (testimony of Gary Raker); ROA p.000596, Trial Tr. vol. II, 41:11--:14, Sept. 25, 2019 (testimony of Continental Resources' corporate representative, Matthew Simmons); ROA p.000574, Journal Entry of J. ¶ 7, at 2. 10 See ROA p.000595, Trial Tr. vol. I, 85:2--:4 (testimony of Gary Raker). 11 See ROA p.000574, Journal Entry of J. ¶ 6, at 2. Incidentally, after the writ of certiorari was granted in this appeal, Tres C filed a Notice of the G.D. Cowan #1 Well Plugging on February 18, 2022. Therein, Tres C informs this Court that Raker Resources has "plugged and abandoned the Cowan Well" and attaches a Plugging Record (Form 1003) that Gary Raker filed with the Oklahoma Corporation Commission on April 15, 2021. Notice of G.D. Cowan #1 Well Plugging 1 & ex. 1. Thus, it appears that Raker Resources is not currently operating the Cowan Well. Nevertheless, this was an improper attempt to supplement the record on appeal with information that was not presented to the trial court or the Court of Civil Appeals, and Tres C's Notice has been stricken by separate order filed concurrently with this opinion. 12 See ROA p.000596, Trial Tr. vol. II, 42:15--43:4 (testimony of Matthew Simmons). 13 See id. at 147:19--:25 (testimony of Matthew Simmons). 14 See id. at 98:19--99:12 (testimony of Gary Raker); ROA p.000598, Jt. Trial Ex. 125, J.P. Dick's Production Graph 1 (depicting a steady decline in the Cowan Well's production from 6 Mcf per day in late 2007 to 1.5 Mcf per day in March 2009). 15 See ROA p.000596, Trial Tr. vol. II, 99:7--100:2 (testimony of Gary Raker). 16 See id. at 99:7--100:2 (testimony of Gary Raker); id. at 241:4--:17 (testimony of defense expert J.P. Dick); ROA p.000598, Jt. Trial Ex. 125, J.P. Dick's Production Graph 1 (showing that production increased from 1.5 Mcf per day to anywhere between 28 Mcf and 50 Mcf for the remainder of 2009). 17 See ROA p.000595, Trial Tr. vol. I, 44:22--45:4 (testimony of Tincy Cowan). 18 ROA p.000598, Jt. Trial Ex. 109, Letter from Mart Tisdal, Tisdal & O'Hara, to Raker Res., LLC 1 (Mar. 30, 2016); ROA p.000574, Journal Entry of J. ¶ 11, at 2. 19 See ROA p.000595, Trial Tr. vol. I, 87:25--90:21 (testimony of Gary Raker); ROA p.000596, Trial Tr. vol. II, 79:2--80:24, 120:10--122:18 (testimony of Gary Raker); ROA pp.000574--000575, Journal Entry of J. ¶ 12, at 2--3. 20 ROA p.000598, Jt. Trial Ex. 111, Letter from Gary Raker, Raker Res., LLC, to Mart Tisdal, Tisdal & O'Hara 1--2 (Apr. 11, 2016). 21 See id. (showing production amounts for January to November of 2015 that ranged from 677 Mcf to 891 Mcf, then a dip in December of 2015 to 432 Mcf, then a rebound to 752 Mcf and 589 Mcf in the first two months of 2016; but also showing similar dips in 2013 and 2014); ROA p.000574, Journal Entry of J. ¶ 10, at 2. 22 ROA p.000598, Jt. Trial Ex. 68, E-mail from Gary Raker, Raker Res., LLC, to Michael Schooley, Cont'l Res., Inc., 1 (Apr. 28, 2016, 12:10 PM); ROA p.000575, Journal Entry of J. ¶ 13, at 3. 23 ROA p.000598, Jt. Trial Ex. 112, Letter from Luke Adams, Tisdal & O'Hara, to Gary Raker, Raker Res., LLC, 1 (June 14, 2016) (emphasis added). 24 Id., Jt. Trial Ex. 76, E-mail from Gary Raker, Raker Res., LLC, to Jay Buckley, Cont'l Res., Inc. 3--4 (July 15, 2016, 6:59 AM). 25 Id., Jt. Trial Ex. 113, Letter from Gary Raker, Raker Res., LLC, to Luke Adams, Tisdal & O'Hara 1--26 (July 18, 2016). 26 Id. at 4. 27 See, e.g., id., Jt. Trial Ex. 6, Raker Res. Gauge Sheets 8--12 (showing the production of 3 barrels of water in January of 2016, 3 barrels in February, nearly 2 barrels in June, 10 barrels in July, 13 barrels in August, and 5 barrels in September and also showing line pressure (LP) readings for May through September of 2016 mostly in the 30- to 40-pound range with occasional spikes in the 80- to 100-pound range). 28 See id., Jt. Trial Ex. 71, E-mails between Gary Raker, Raker Res., LLC, and Michael Schooley, Cont'l Res., Inc., 2 (Oct. 21, 2016, 11:04 AM) (wherein Mr. Raker attributed the problem "to high line pressure" that "may be due to new wells nearby packing the line"); ROA p.000596, Trial Tr. vol. II, 88:11--92:15 (wherein Mr. Raker testified during Defendants/Petitioners' case-in-chief that "we did see 80-pound line pressure there the first of the month" of September and "whenever I see production -- especially on this well -- production gradually going down, you think liquid loading, at least that's my working hypothesis"); ROA p.00595, Trial Tr. Vol. I, 95:13--:19, 106:4--:16 (wherein Mr. Raker testified during Plaintiff/Respondent's case-in-chief that "part of . . . [his] assumption or [his] theory" for the Cowan Well's low production was "high line pressure in the area" and "part of [his] theory of what was the problem is that liquid loading"). 29 See id., Jt. Trial Ex. 5, Raker Res. Jt. Interest Billings 11 (showing production of only 286 Mcf and a negative net revenue). 30 See ROA p.000598, Jt. Trial Ex. 6, Raker Res. Gauge Sheets 13. 31 See id., Jt. Trial Ex. 8, Enable Gathering & Processing, LLC's Gas Volume Statement 61 (showing gas production for 10/15/2016 and 10/16/2016 of 0 Mcf); id., Jt. Trial Ex. 6, Raker Res. Gauge Sheets 13 (showing gas production on October 15 and 16 of 7 Mcf and 2 Mcf, respectively); ROA p.000595, Trial Tr. vol. I, 112:10--113:19 (testimony of Gary Raker). 32 See ROA p.000598, Jt. Trial Ex. 5, Raker Res. Jt. Interest Billings 8--13 (showing expenses for "SOAP" or "KEL-TECH" or "FOAMER" for February, March, April, May, July, September, October, and November). 33 See id., Jt. Trial Ex. 6, Raker Res. Gauge Sheets 11 (showing notes that the flow of pressure was "Switched [to the] Casing Side" and then back "To Coil Tubing" on August 22nd and 23rd). 34 See ROA p.000596, Trial Tr. vol. II, 92:23--93:20 (testimony of Gary Raker). 35 See ROA p.000598, Jt. Trial Ex. 5, Raker Res. Jt. Interest Billings 12; see also id., Jt. Trial Ex. 10, Invoices for the Cowan Well 13--22 (showing the several invoices that correlate to the expenses listed on the joint interest billings). 36 ROA p.000596, Trial Tr. vol. II, 94:21--95:17 (testimony of Gary Raker); ROA p.000577, Journal Entry of J. ¶ 30, at 5. 37 ROA p.000598, Jt. Trial Ex. 71, E-mails between Gary Raker, Raker Res., LLC, and Michael Schooley, Cont'l Res., Inc., 2 (Oct. 22, 2016, 11:04 AM). 38 Id. 39 ROA p.000596, Trial Tr. vol. II, 95:16--:20 (testimony of Gary Raker). 40 ROA p.000598, Jt. Trial Ex. 6, Raker Res. Gauge Sheets 14. 41 See ROA p.000596, Trial Tr. vol. II, 95:20--96:1, 97:18--:23 (wherein Gary Raker testified that production "was not as good as we hoped" when the Cowan Well was first brought back online, but "they finally got it lined out there towards the middle of the month there. [November] 16th they got -- brought it back on over 20 a day . . . . which was encouraging, you know. It was kind of back up to where it was"). 42 See id. at 96:2--:9, 97:24--98:2 (testimony of Gary Raker). 43 See ROA p.000598, Jt. Trial Ex. 5, Raker Res. Jt. Interest Billings 12--13 (showing negative "Net Cash" amounts for October and December and showing a positive "Net Cash" amount for November only because of some creative accounting whereby a $749.68 expense from October was credited back so that it could be spread out over several months, which credit had the effect of negating all other expenses and even contributing an additional amount towards revenue). 44 See id., Jt. Trial Ex. 114, Letter from Edward Voda, J&R Energy Res., LLC, to Viola Cowan, Tres C, LLC, 1 (Nov. 14, 2016). Interestingly, the address on J&R Energy's letterhead matches the return address on the Andrews Davis law firm's letterhead. Compare id., with id., Jt. Trial Ex. 115, Letter from Randy C. Smith, Andrew Davis, to DewBlaine Energy, LLC 1--2 (Nov. 16, 2016). 45 Id., Jt. Trial Ex. 114, Letter from Edward Voda, J&R Energy Res., LLC, to Viola Cowan, Tres C, LLC, 1 (Nov. 14, 2016); see also ROA p.000595, Trial Tr. vol. I, 47:13--48:15, 52:21--54:14, Sept. 24, 2019 (wherein Tincy Cowan testified about this agreement, providing some of the redacted details, and testified that J&R did "perform under this contract"). 46 ROA p.000598, Jt. Trial Ex. 116, Aff. & Mem. Of Lease Option Agmt. 1. 47 Id., Jt. Trial Ex. 115, Letter from Randy C. Smith, Andrew Davis, to DewBlaine Energy, LLC 1 (Nov. 16, 2016). 48 Id. at 1--2. 49 Id., Jt. Trial Ex. 77, E-mail from Jongsoo "Vincent" Kim, DewBlaine Energy, LLC, to Justin Crooks, Cont'l Res., Inc., 2 (Dec. 5, 2016, 6:15 PM). 50 Id., Jt. Trial Ex. 74, E-mail from Gary Raker, Raker Res., LLC, to Michael Schooley, Cont'l Res., Inc., 1 (Dec. 6, 2016, 4:02:27 PM); see also ROA p.000596, Trial Tr. vol. II, 101:21--105:22 (testimony of Gary Raker). According to the entries of appearance filed in this appeal, the lawyer who placed the phone call now works for a different law firm; the lawyer represented Tres C until March 26, 2020, when this Court granted a motion to withdraw as counsel of record. 51 ROA p.000598, Jt. Trial Ex. 74, E-mail from Gary Raker, Raker Res., LLC, to Michael Schooley, Cont'l Res., Inc., 1 (Dec. 6, 2016, 4:02:27 PM); ROA p.000596, Trial Tr. vol. II, 104:20--:21 (testimony of Gary Raker). 52 ROA p.000598, Jt. Trial Ex. 74, E-mail from Gary Raker, Raker Res., LLC, to Michael Schooley, Cont'l Res., Inc., 1 (Dec. 6, 2016, 4:02:27 PM). 53 Id. 54 ROA p.000596, Trial Tr. vol. II, 107:11--108:07 (testimony of Gary Raker). 55 Id. at 191:16--:23 (testimony of Continental Resources' former employee, Justin Crooks). 56 ROA p.000598, Jt. Trial Ex. 79, E-mail from Justin Crooks, Cont'l Res., Inc., to Gary Raker, Raker Res., LLC, 2 (Dec. 6, 2016, 5:16 PM). 57 Id., Jt. Trial Ex. 79, E-mail from Gary Raker, Raker Res., LLC, to Justin Crooks, Cont'l Res., Inc., 1--2 (Dec. 6, 2016, 11:33 PM). 58 See ROA p.000596, Trial Tr. vol. II, 59:10--61:19 (testimony of Matthew Simmons); id. at 149:13--155:17 (same); id. at 191:24--192:7 (testimony of Justin Crooks). 59 ROA p.000598, Jt. Trial Ex. 23, August 5, 2016 Well Proposal. 60 Id., Jt. Trial Ex. 24, Appl. 1--2, In re Appl. of Cont'l Res., Inc. for Pooling in Section 2-14N-13W, Cause CD No. 201603738 (Okla. Corp. Comm'n Aug. 24, 2016); id., Jt. Trial Ex. 25, Appl. 1, In re Appl. of Cont'l Res., Inc. to Establish 640-Acre Drilling & Spacing Unit in Section 2-14N-13W, Cause CD No. 201603737 (Okla. Corp. Comm'n Aug. 24, 2016); id., Jt. Trial Ex. 26, Appl. 1, In re Appl. of Cont'l Res., Inc. to Establish 640-Acre Drilling & Spacing Unit in Section 35-15N-13W, Cause CD No. 201603739 (Okla. Corp. Comm'n Aug. 24, 2016). 61 Id., Jt. Trial Ex. 28, Order of the Comm'n 1--2, In re Appl. of Cont'l Res., Inc. to Establish 640-Acre Drilling & Spacing Unit in Section 35-15N-13W, Cause CD No. 201603739 (Okla. Corp. Comm'n Oct. 7, 2016). 62 Id., Jt. Trial Ex. 78, E-mail from Jeff Cook, Cont'l Res., Inc., to Trent Guinn et al., Cont'l Res., Inc., 1--2 (Dec. 16, 2016, 2:41 PM). 63 Id.; see also ROA p.000596, Trial Tr. vol. II, 68:20--72:16 (testimony of Matthew Simmons); id. at 195:3--:12, 197:2--:20 (testimony of Justin Crooks). 64 STACK is a regional term used to reference the Sooner Trend oil field in the Anadarko basin, which is located primarily in Canadian and Kingfisher Counties. It also covers portions of Blaine County, including Section 35-15N-13W. 65 See ROA p.000596, Trial Tr. vol. II, 193:13--194:4, 201:11--:16, 207:1--:15 (testimony of Justin Crooks). 66 ROA p.000598, Jt. Trial Ex. 79, E-mail from Justin Crooks, Cont'l Res., Inc., to Gary Raker, Raker Res., LLC, 1 (Dec. 16, 2016, 10:34 am). 67 Id., E-mail from Gary Raker, Raker Res., LLC, to Justin Crooks, Cont'l Res., Inc., 1 (Dec. 16, 2016, 9:11:42 PM +0000). 68 Id., Jt. Trial Ex. 83, E-mail from Justin Crooks, Cont'l Res., Inc., to Gary Raker, Raker Res., LLC, 1 (Dec. 21, 2016, 6:56 PM). 69 Id., Jt. Trial Ex. 34, Well Location Plat 1; id., Jt. Trial Ex. 66, Cont'l Res., Inc. Location Report 1; ROA p.000596, Trial Tr. vol. II, 203:25--204:11 (testimony of Justin Crooks). 70 ROA p.000595, Trial Tr. vol. I, 71:10--:20 (testimony of David Cowan). See generally 52 O.S.2021, § 318.3 ("Before entering upon a site for oil or gas drilling, except in [certain] instances [not applicable here] . . . , the operator shall give to the surface owner a written notice of his intent to drill containing a designation of the proposed location and the approximate date that the operator proposes to commence drilling. Such notice shall be given to the surface owner in any manner as provided for in paragraph 1 and paragraph 2 of subsection C of Section 2004 of Title 12 of the Oklahoma Statutes for the service by personal delivery or by mail of a summons in a civil action. . . . Within five (5) days of the date of delivery or service of the notice of intent to drill, it shall be the duty of the operator and the surface owner to enter into good faith negotiations to determine the surface damages."); id. § 318.5(A) ("Prior to entering the site with heavy equipment, the operator shall negotiate with the surface owner for the payment of any damages which may be caused by the drilling operation. . . ."). 71 ROA p.000595, Trial Tr. vol. I, 71:20--:25 (testimony of David Cowan). 72 See id., Trial Tr. vol. I, 72:1--:4, 77:10--78:1; Cont'l Res., Inc. v. Tres C, L.L.C., No. CJ-2017-0003 (Blaine Cty. Dist. Ct. filed Jan. 17, 2017). See generally 52 O.S.2021, § 318.5(A) (" . . . If the parties agree, and a written contract is signed, the operator may enter the site to drill. If agreement is not reached, . . . the operator shall petition the district court in the county in which the drilling site is located for appointment of appraisers to make recommendations to the parties and to the court concerning the amount of damages, if any. Once the operator has petitioned for appointment of appraisers, the operator may enter the site to drill."). 73 ROA p.000595, Trial Tr. vol. I, 78:2--:6 (testimony of David Cowan); ROA p.000598, Jt. Trial Ex. 62, Surface Use Agreement (dated May 25, 2017, and executed by Tincy Cowan on June 12, 2017). 74 ROA p.000598, Jt. Trial Ex. 36, Cont'l Res., Inc. Auth. for Expenditure 1--2. 75 Id., Jt. Trial Ex. 42, Appl. 1, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n filed Jan. 6, 2017); id., Jt. Trial Ex. 38B, Appl. 1, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700063 (Okla. Corp. Comm'n filed Jan. 6, 2017); id., Jt. Trial Ex. 43, Appl. 1, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700064 (Okla. Corp. Comm'n filed Jan. 6, 2017). 76 Id., Jt. Trial Ex. 40, Notice of Hr'g 1--2, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n Jan. 6, 2017); id., Jt. Trial Ex. 41, Notice of Hr'g 1--2, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700063 (Okla. Corp. Comm'n Jan. 6, 2017). 77 Id., Jt. Trial Ex. 66, Cont'l Res., Inc. Location Report 1; ROA p.000596, Trial Tr. vol. II, 203:25--204:4, 204:12--:16 (testimony of Justin Crooks); ROA pp.000574, 000577, Journal Entry of J. ¶¶ 7, 32, at 2, 5. 78 ROA p.000598, Jt. Trial Ex. 51, Entry of Appearance & Notice of Protest 1, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n filed Jan. 27, 2017); id., Jt. Trial Ex. 50, Entry of Appearance & Notice of Protest 1, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700063 (Okla. Corp. Comm'n filed Jan. 27, 2017); id., Jt. Trial Ex. 52, Entry of Appearance & Notice of Protest 1, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700064 (Okla. Corp. Comm'n filed Jan. 27, 2017). 79 See, e.g., id., Jt. Trial Ex. 59, Emergency Order ¶ 3, at 1, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n Mar. 9, 2017). 80 Id., Jt. Trial Ex. 54, Appl. for Emergency Order ¶ 2, at 1, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n filed Feb. 3, 2017); id., Jt. Trial Ex. 56, Appl. for Emergency Order ¶ 2, at 2, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 201700063 (Okla. Corp. Comm'n filed Jan. 6, 2017). 81 Id., Jt. Trial Ex. 59, Emergency Order 1--2, In re Appl. of Cont'l Res., Inc. for Multiunit Horizontal Well, Cause CD No. 201700062 (Okla. Corp. Comm'n Mar. 9, 2017); id., Jt. Trial Ex. 60, Emergency Order 2, In re Appl. of Cont'l Res., Inc. for Well Location Exception, Cause CD No. 20170063 (Okla. Corp. Comm'n Mar. 9, 2017). 82 ROA p.000596, Trial Tr. vol. II, 214:9--:15 (testimony of Justin Crooks). 83 ROA p.000598, Jt. Trial Ex. 57, Permit to Drill 1. 84 Id., Jt. Trial Ex. 65A, Okla. Corp. Comm'n Completion Report 1; id., Jt. Trial Ex. 36, Cont'l Res., Inc. Auth. for Expenditure 3 (showing Continental Resources' authorization on February 23rd to spend $9,397,169 towards completion of the multiunit Tres C Well); ROA p.000596, Trial Tr. vol. II, 215:25--216:7, 217:19--218:3 (testimony of Justin Crooks). 85 ROA p.000001, Pet. 1. 86 ROA pp.000001--000002, Pet. ¶¶ 5, 7, at 1--2. 87 ROA p.000595, Trial Tr. vol. I, 48:21--50:8 (testimony of Tincy Cowan); id. at 72:18--:25 (testimony of David Cowan). 88 Id. at 197:1--:3 (testimony of Aaron Anderson). 89 Id. at 152:1--:15, 173:13--:23. 90 ROA p.000596, Trial Tr. vol. II, 43:19--46:24, 163:5--164:5 (testimony of Matthew Simmons). 91 Id. at 80:15--81:13, 83:2--:8, 94:9--19, 101:21--106:5, 108:9--109:16, 111:11--112:9 (testimony of Gary Raker); see also id. at 142:24--143:17 (testifying that, based on his experience, a reasonable operator would not have abandoned the Cowan Well in October, November, December, or January). 92 See id. at 223:13--225:11, 229:9--:23 (testimony of Justin Crooks). 93 See id. at 266:14--:19, 267:9--:13, 273:7--274:16 (testimony of J.P. Dick); ROA p.000597, Trial Tr. vol. III, 18:18--19:25 (testimony of J.P. Dick). 94 See ROA p.000596, Trial Tr. vol. II, 274:14--277:24 (testimony of J.P. Dick). 95 See ROA p.000597, Trial Tr. vol. III, 73:3--:13 (testimony of J.P. Dick). 96 ROA p.000596, Trial Tr. vol. II, 278:8--280:23 (testimony of J.P. Dick); ROA p.000597, Trial Tr. vol. III, 18:18--19:25, 21:17--22:8 (testimony of J.P. Dick). 97 ROA p.000597, Trial Tr. vol. III, 51:22--55:6 (testimony of J.P. Dick). 98 Id. at 72:11--73:2. 99 See generally ROA p.000596, Trial Tr. vol. II, 191:9--219:10 (testimony of Justin Crooks). 100 ROA p.000576, Journal Entry of J. ¶¶ 21--24, at 4. 101 Id. at p.000575, Journal Entry of J. ¶ 15, at 3. 102 Id. at pp.000575--000577, Journal Entry of J. ¶¶ 16--20, 26--27, at 3--5. 103 Id. at p.000577, Journal Entry of J. ¶¶ 28--29, at 5. 104 Id., Journal Entry of J. ¶¶ 31--34, at 5; see also id. at p.000574, Journal Entry of J. ¶ 7, at 2 ("Continental commenced operations for the drilling of the well in January, 2017."). 105 Id. at p.000577, Journal Entry of J. ¶ 34, at 5. 106 Id., Journal Entry of J. ¶ 36, at 5. 107 Pet. in Error 1--2, Feb. 14, 2020. 108 Compare Pet. in Error ex. C (listing five issues to be raised on appeal, including the trial court's alleged error in not considering Continental Resources' preparatory acts to drill the new Tres C Well occurring prior to January 19, 2017, as well as the trial court's alleged error in counting compressor expenses and low-volume fees as "lifting costs"), with Appellants' Br. 13--14 (only listing the two issues discussed infra). 109 Appellants' Br. 15 (quoting the ALL CAPS text of the heading, but removing the ALL CAPS formatting). 110 Id. at 13--14. 111 Id. at 14, 26--28. 112 Id. at 14. 113 Order 1, Mar. 6, 2020 (denying Defendants/Petitioners' motion to retain); Order Sheet 1, Dec 9, 2020 (assigning this and other appeals to the COCA). 114 COCA's Op. 2, 4, 8--9 (unpublished). 115 Id. at 11. 116 Id. 117 Appellants' Pet. for Writ of Cert. 1. 118 See id. at 1--3. 119 Id. at 5--6. 120 Id. at 5; see also id. at 1, 6--10 & n.1 (citing and quoting Hall, 2018 OK 59, 427 P.3d 1052; Pack, 1994 OK 23, 869 P.2d 323; Stewart, 1979 OK 145, 604 P.2d 854). 121 Id. at 5; see also id. at 1--2, 6--8 & n.3 (citing and quoting 2 Eugene Kuntz, A Treatise on the Law of Oil and Gas §§ 26.6, 26.7(u), 26.13(b) (1990 & Supp. 2021); 4 Eugene Kuntz, A Treatise on the Law of Oil and Gas § 47.3(a)(1) (Supp. 2021)). 122 See id. at 1, 8 & n.2. 123 Appellee's Resp. to Appellants' Pet. for Writ of Cert. 1, 5; Appellee's Answer Br. 8. 124 Appellee's Resp. to Appellants' Pet. for Writ of Cert. 1--4 (citing and quoting Hall, 2018 OK 59, 427 P.3d 1052; French, 1986 OK 22, 725 P.2d 275; Hoyt, 1980 OK 1, 606 P.2d 560); Appellee's Answer Br. 8--16. 125 Appellee's Resp. to Appellants' Pet. for Writ of Cert. 5, 8 (citing Pack, 1994 OK 23, 869 P.2d at 327; Blair, 2017 OK CIV APP 57, 406 P.3d 580). 126 Id. at 9. 127 Title 12, section 100 of the Oklahoma Statutes provides as follows: If any action is commenced within due time, and a judgment thereon for the plaintiff is reversed, or if the plaintiff fail in such action otherwise than upon the merits, the plaintiff . . . may commence a new action within one (1) year after the reversal or failure although the time limit for commencing the action shall have expired before the new action is filed. 12 O.S.2011, § 100 (emphasis added)). 128 See supra note 5 and accompanying text (emphasis added). 129 See supra notes 32 through 41 and accompanying text. 130 See supra notes 101--102 and accompanying text. 131 See supra notes 32 through 41 and accompanying text. 132 See supra notes 101 and accompanying text.

d5e15e42-f1c7-4f3c-9688-0ab0672e5b2f

Vaughn v. Graves

oklahoma

Oklahoma Supreme Court

VAUGHAN v. GRAVES2012 OK 113Case Number: 110622Decided: 12/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. Henry Dean Vaughan and Jessie Elaine Vaughan, Petitioners, v. Honorable Bill Graves, District Judge of the District Court of Oklahoma County, Respondent. APPLICATION TO ASSUME ORIGINAL JURISDICTION AND PETITION FOR EXTRAORDINARY RELIEF ¶0 Debtors brought this original action challenging the jurisdiction of the trial court, Honorable Bill Graves, to enforce orders that were entered before the debtors' bankruptcy judgment was domesticated in the county from which execution on the judgment was to issue. ORIGINAL JURISDICTION ASSUMED; EXTRAORDINARY RELIEF GRANTED. Mark D. Mitchell, Mitchell & Hammond, Oklahoma City, Oklahoma, for Petitioners Henry Dean Vaughan and Elaine Vaughan. G. Michael Solomon, Stillwater, Oklahoma, for Real Party in Interest, Bank of Cushing. Michael Paul Kirschner, Robertson & Williams, Oklahoma City, Oklahoma, for Real Party in Interest, Bank of Cushing. Andrew M. Coats, Charles B. Goodwin, Crowe & Dunlevy, Oklahoma City, for Real Party in Interest, Bank of Cushing. COLBERT, V.C.J. ¶1 This matter raises a first impression question concerning whether proceedings in aid of execution, or judgment collection that are pursued within an action brought pursuant to the Uniform Fraudulent Transfers Act (UFTA), Okla. Stat. tit. 24, §§ 112 - 123 (2011), must be preceded by registration of a foreign judgment in the county of the district court from which execution issues. This Court holds that registration of a foreign judgment is a jurisdictional prerequisite to execution and judgment collection remedies. Facts and Procedural History ¶2 In 1995, Henry Dean Vaughan, a medical doctor, and Elaine Vaughan, his wife, (Debtors) became unconditional guarantors of a commercial loan from the Bank of Cushing (Bank) in order to invest in a family business which ultimately failed. Debtors filed a bankruptcy petition in 1999. Bank brought a UFTA action in Oklahoma County in 2001 against certain relatives of Debtors and a family trust alleging a scheme of fraudulent transfers and a civil conspiracy to defraud Bank by hiding Debtors' assets. ¶3 In 2002, the United States Bankruptcy Court for the Western District of Oklahoma entered summary judgment against Debtors and denied a discharge of the debt to Bank based on Debtors' fraudulent concealment of assets. The bankruptcy court entered a judgment against Debtors in the amount of $364,024.75 and a separate judgment which included costs in the amount of $46,527.34 and attorney fees of $393,472.66. ¶4 Bank initiated various collection procedures against Debtors including garnishment and a hearing on assets in an attempt to satisfy the two judgments totaling over $800,000. The bankruptcy judgments were registered in Payne County, the location of Debtors' homestead, in July, 2002. Meanwhile, the UFTA action continued to proceed in Oklahoma County against Debtors' relatives. ¶5 In September, 2007, the trial court entered an order in the UFTA action which determined that Debtors' income from Dr. Vaughan's emergency room medical practice had been fraudulently diverted to a sham corporation for the purpose of avoiding the garnishment of that income. It ordered the corporation to turn over twenty-five per cent of the funds Debtors had received for medical services to Bank. However, it was not until November, 2007, that Bank's second amended petition in the UFTA action added Debtors and the corporation as defendants. ¶6 In December, 2009, a contempt trial against Debtors generated an order filed October 21, 2010. That order expressly withdrew and superseded the September, 2007, order. It found Dr. Vaughan guilty of contempt for his failure to obey the 2007 order and ordered him to sixty days imprisonment. However, the trial court gave the doctor the opportunity to purge his sentence through compliance with a "charging order" which attached to twenty five percent of Debtors' income. The charging order was to remain in effect until the bankruptcy judgments and any associated interest and attorney fees were paid in full.1 ¶7 In April, 2011, Bank sought contempt to enforce the 2010 order. On August 18, 2011, Bank registered one of the bankruptcy judgments, the one for costs and attorney fees, in Oklahoma County. On March 15, 2012, the present trial judge entered an order on Bank's motion to enforce the 2010 contempt order. The trial court found open and wilful violations of the withdrawn 2007 order as well as the 2010 order, including diversion of medical income. ¶8 The trial court acknowledged that Bank had failed to comply with the statutory requirements of registration of foreign judgments in the county of the court which issues execution, but it determined that those requirements did not apply in a UFTA action. Debtors brought this original proceeding asserting the trial court's lack of jurisdiction to impose the relief granted to Bank. This Court assumes original jurisdiction to address an important issue of first impression concerning the requirements of registration of foreign judgments in a UFTA action. Standard of Review ¶9 A decision concerning which statutes apply to a given set of facts is one of law. Glass Law Firm P.C. v. Cornejo, 2011 OK CIV APP 75, ¶ 5, 259 P.3d 883, 885. Questions of law are reviewed de novo. Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶ 14, 859 P.2d 1081, 1084. Analysis ¶10 At issue in this matter is the jurisdiction of the trial court to enforce orders in aid of execution of a foreign judgment or judgment collection remedies before a creditor has registered the foreign judgment in the county of the court from which execution issues. Several statutory provisions are implicated. ¶11 The UFTA has been adopted in forty two states. Okla. Stat. Ann. tit. 24, ch. 7 (West 2012). "The purpose of the Act is to allow a creditor the opportunity to invalidate the transfer of assets made by a debtor if the transfer has the effect of placing assets out of reach of present and future creditors." Burrows v. Burrows, 1994 OK 129, ¶ 9, 886 P.2d 984, 988. Bank brought a UFTA action in Oklahoma County against relatives of Debtors while Debtors' bankruptcy proceeding was pending and the automatic stay was in effect. After the bankruptcy court denied a discharge of the debt and entered two judgments for Bank, Debtors and associated entities were added to the UFTA action. The November, 2007, amended petition provided the trial court jurisdiction over the parties to the UFTA action but it did not provide the trial court with the authority to issue execution on the bankruptcy judgments or otherwise initiate collection remedies including contempt for nonpayment of the judgments.2 That authority is derived from other statutory provisions.3 ¶12 The Uniform Enforcement of Foreign Judgments Act, Okla. Stat. tit. 12, §§ 719 - 726 (2011), has been adopted in forty six states. "In this act 'foreign judgment' means any judgment, decree, or order of a court of the United States or of any other court which is entitled to full faith and credit in this state." Id. at § 720. The Act provides: A copy of any foreign judgment authenticated in accordance with the applicable Act of Congress or of the statutes of this state may be filed in the office of the court clerk of any county of this state. The clerk shall treat the foreign judgment in the same manner as a judgment of the district court of any county of this state. A judgment so filed has the same effect and is subject to the same procedures, defenses, and proceedings for reopening, vacating, or staying as a judgment of a district court of this state and may be enforced or satisfied in like manner. Provided, however, that no such filed foreign judgment shall be a lien on real estate of the judgment debtor until the judgment creditor complies with the requirements of subsection B of Section 706 of this title. Okla. Stat. tit. 12, § 721 (2011). "Under this provision the mere act of filing, in substance, transfers the properly authenticated foreign judgment into an Oklahoma judgment." Producers Grain Corp. v. Carroll, 1976 OK CIV APP 3, ¶ 8, 546 P.2d 285, 287. The judgment may be enforced against the judgment debtor "in the same manner as any intra-state judgment." Id. Therefore, the two bankruptcy judgments were domesticated in Oklahoma upon their filing in Payne County in July, 2002. However, that is not where the analysis ends. ¶13 Section 706 of title 12 "applies to all judgments of courts of record of this state, and judgments of courts of the United States . . . which award the payment of money, regardless of whether such judgments also include other orders or relief." Okla. Stat. tit. 12, § 706(A) (2011). That provision specifically requires that "[e]xecution shall be issued only from the court which granted the judgment being enforced." Id. at § 706(D). Thus, while domestication of a foreign judgment may be obtained by its filing in any county, execution of that foreign judgment requires that it be filed in the county of the court that enforces the judgment.4 ¶14 In this matter, the current trial judge in March, 2012, attempted to enforce orders made by another trial judge in the case entered in 2007 and 2010. The 2007 order was entered before Debtors were made parties to the UFTA action and thus was void as to any action against them. Presumably for that reason, the 2010 order withdrew and superseded the 2007 order. However, the 2010 order attempted to enforce payment of the bankruptcy judgments through contempt proceedings. Dr. Vaughan was sentenced to sixty days in jail but he was given the opportunity to purge his sentence by compliance with a "charging order" that directed the computation and payment of twenty five per cent of Debtors' gross income to satisfy the bankruptcy judgments. It was not until 2011 that one of the judgments was filed in Oklahoma County. ¶15 The March 15, 2012 order that generated this original proceeding was entered in response to Bank's request for enforcement of the 2010 order. The present trial judge noted in the 2012 order that the 2010 order was "based on a judgment that was not filed in this forum until August, 2011. Thus, the said judgments could not be enforced before the August, 2011 filing in Oklahoma County." However, the trial court reasoned that, because the attempts to enforce the bankruptcy judgments were made within a UFTA action, filing of the judgments in Oklahoma County was not a prerequisite to the court's jurisdiction. The trial court assessed damages and attorney fees for violation of the 2010 order and directed compliance with its provisions concerning payment of the debt. The court expressly retained jurisdiction to enforce the 2007 and 2010 orders. ¶16 The trial court's analysis of its legal authority is flawed. A court may enforce a foreign judgment as if it had rendered it but only after the statutory registration requirements have been satisfied. This is true whether the attempt at enforcement of the foreign judgment is in the nature of execution or contempt. Until such time, the trial court lacks the authority to act. The fact that this matter was brought pursuant to the UFTA does not change the registration requirements. The foreign judgment must be filed in the county of the court from which remedies in the nature of execution will issue before that court can acquire jurisdiction. ¶17 The belated registration of the foreign judgment in 2011 did not authorize the trial court to retroactively enforce orders which were void for lack of jurisdiction. The 2007 order was expressly withdrawn and superseded by the 2010 order. However, the portions of the 2010 order that attempt to enforce the bankruptcy judgments that had not yet been filed in Oklahoma County were void for lack of jurisdiction. When a judgment was registered in Oklahoma County in 2011, the trial court did not retroactively acquire jurisdiction to enforce the provisions of the 2007 and 2010 orders that granted remedies in the nature of execution, including contempt, and threatened incarceration for failure to pay the judgments. ¶18 The 2011 judgment registration did not make the void portions of the prior orders any less so. "A trial court may not take judicial notice of findings of fact and conclusions of law encompassed within a void judgment." Valley Vista Dev. Corp., Inc. v. City of Broken Arrow, 1988 OK 140, ¶ 2, 766 P.2d 344, 346. New findings of fact and conclusions of law regarding any attempt to enforce the bankruptcy judgments are required. ORIGINAL JURISDICTION ASSUMED; EXTRAORDINARY RELIEF GRANTED. CONCUR: Taylor, C.J.; Colbert, V.C.J.; Watt, Winchester, Edmondson, Reif, Combs, Gurich, JJ. NOT PARTICIPATING: Kauger, J. FOOTNOTES 1 The October 21, 2010 order is currently on appeal in case no. 108,947. 2 The elements of jurisdiction are: (1) jurisdiction over the parties; (2) jurisdiction over the subject matter; and (3) jurisdiction to render the particular judgment sought. Heiman v. Atlantic Richfield Co., 1991 OK 22, ¶ 6 n.11, 807 P.2d 257, 259. 3 The UFTA specifically provides: "Unless displaced by the provisions of the Uniform Fraudulent Transfer Act, the principles of law and equity . . . supplement the provisions of the [UFTA]." Okla. Stat. tit. 24, § 122 (2011). 4 Similarly, registration of a foreign judgment does not create a lien on real property of a judgment debtor until a statement of judgment has been filed in the office of the county clerk in that county. Okla. Stat. tit. 12, § 706(B) (2011). See also, Okla. Stat. tit. 12, § 721 (2011) ("no such filed foreign judgment shall be a lien on real estate of the judgment debtor until the judgment creditor complies with the requirements of subsection B of Section 706 of this title").

5409c69f-a903-42e8-8007-70e319c5aeaa

Ada Electric Cars, LLC v. Kemp

oklahoma

Oklahoma Supreme Court

ADA ELECTRIC CARS, LLC. v. KEMP2012 OK 110Case Number: 111016Decided: 12/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ADA ELECTRIC CARS, LLC., Plaintiff/Appellant,v.THOMAS KEMP, JR., JERRY JOHNSON, DAWN CASH, and RICK MILLER, Defendants/Appellees. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTYHONORABLE DONALD WORTHINGTONDISTRICT JUDGE ¶0 Appeal of an August 13, 2012, final order denying the Plaintiff/Appellant's motion for a new trial and dismissing the Plaintiff/Appellant's first amended petition with prejudice. Defendants/Appellees successfully argued they were entitled to claim qualified immunity from suit. We find the Defendants/Appellees possess qualified immunity from suit in the present matter and affirm the judgment of the trial court. JUDGMENT OF THE TRIAL COURT IS AFFIRMED Daniel G. Webber, Jr. and Grant M. Lucky, Ryan Whaley Coldiron Shandy PLLC., Oklahoma City, Oklahoma, for Plaintiff/Appellant.Joe M. Hampton and Amy J. Pierce, Corbyn Hampton, PLLC, Oklahoma City, Oklahoma, for Defendants/Appellees. COMBS, J: ¶1 Ada Electric Cars, LLC (Plaintiff/Appellant) filed this lawsuit against Thomas Kemp Jr., Jerry Johnson, Dawn Cash, and Rick Miller (collectively, Defendants/Appellees), members of the Oklahoma Tax Commission (OTC), in their individual capacities, in response to the OTC's denial of a statutory tax credit for certain models of Tomberlin low-speed electric vehicles (LSVs) sold by the Appellant to its customers. The statutory tax credit was originally enacted in the 1990s, and the controlling version in this case was codified at 68 O.S.Supp 2008, § 2357.22. It provided for a one-time credit against income tax for investments in qualified electric motor vehicle property.1 This is the latest in several cases to come before this Court all concerning the LSV tax credit codified at 68 O.S.Supp 2008, § 2357.22.2 The dispositive issue presented is whether Appellees are entitled to qualified immunity from suit for their determination that LSVs sold by Appellant did not qualify for the tax credit provided for in 68 O.S.Supp 2008, § 2357.22. We hold that they are. FACTS AND PROCEDURAL HISTORY ¶2 Appellant brings suit against Appellees in their individual capacities pursuant to 42 U.S.C. § 1983, alleging Appellees violated Appellant's constitutional rights by infringing upon Appellant's freedom of speech and denying Appellant equal protection under the law. 3 More specifically, Appellant alleges Appellees violated its rights by: 1) treating Appellant's vehicles and customers differently than other similarly situated LSV dealers due to the manner in which it applied the tax credit provided for in 68 O.S.Supp 2008, § 2357.22; 2) applying a construction of the statute that produced inconsistent, arbitrary, discriminatory, and absurd results; and 3) retaliating against Appellant for what Appellant claims was its protected speech in advertising the applicability of the tax credit to its vehicles. ¶3 Appellees moved to dismiss Appellant's lawsuit on multiple grounds, including: 1) Appellant lacked standing; 2) the § 1983 claims failed because they were conclusory; 3) Appellant failed to properly assert a First Amendment claim or Equal Protection claim; and 4) Appellees are entitled to qualified immunity on all claims as a matter of law. Appellant responded to Appellees' motion to dismiss, disputing all of the above grounds for dismissal. On June 29, 2012, the trial court dismissed Appellant's First Amended Petition with prejudice, without stating grounds for dismissal. Appellant then filed a motion for a new trial, which the trial court denied on August 13, 2012. Appellant appealed and filed its petition in error on August 29, 2012. We retained jurisdiction. The applicability of the defense of qualified immunity is dispositive. ¶4 Appellees assert here, as they have previously when sued in their individual capacity by other LSV dealers, that they possess qualified immunity from suit. Qualified immunity is an affirmative defense which entitles government officials, performing discretionary functions, not to stand trial or face other burdens of litigation, such as discovery. Rooks v. State Through Oklahoma Corp. Comm'n, 1992 OK CIV APP 155, ¶6, 842 P.2d 773, 776; Harlow v. Fitzgerald, 457 U.S. 800, 102 S. Ct. 2727, 73 L. Ed. 2d 396 (1982). Because qualified immunity is an immunity from suit rather than a mere defense to liability, it is effectively lost if a case is erroneously permitted to go to trial. In Pearson v. Callahan, 555 U.S. 223, 232, 129 S. Ct. 808, 815, 172 L. Ed. 2d 565 (2009), the United States Supreme Court held that: Because qualified immunity is "an immunity from suit rather than a mere defense to liability ... it is effectively lost if a case is erroneously permitted to go to trial." Mitchell v. Forsyth, 472 U.S. 511, 526, 105 S. Ct. 2806, 86 L. Ed. 2d 411 (1985) (emphasis deleted). Indeed, we have made clear that the "driving force" behind creation of the qualified immunity doctrine was a desire to ensure that " 'insubstantial claims' against government officials [will] be resolved prior to discovery." Anderson v. Creighton, 483 U.S. 635, 640, n. 2, 107 S. Ct. 3034, 97 L. Ed. 2d 523 (1987). Accordingly, "we repeatedly have stressed the importance of resolving immunity questions at the earliest possible stage in litigation." Hunter v. Bryant, 502 U.S. 224, 227, 112 S. Ct. 534, 116 L. Ed. 2d 589 (1991) (per curiam). The question of whether parties to a suit possess qualified immunity is a question of law, and we review it de novo. Barnthouse v. City of Edmond, 2003 OK 42, ¶20, 73 P.3d 840, 849; Mitchell, 472 U.S. at 528; Melton v. City of Oklahoma, 879 F.2d 706, 726 (10th Cir. 1989). ¶5 This Court has previously espoused that there exists a presumption of immunity in favor of government officials which is not overcome unless it is shown the government officials violated clearly established law or constitutional rights of which a reasonable official should have known. Barnthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849. In Barnthouse, we held: … an objective test … determine[s] whether the doctrine of qualified immunity applies. When government officials are performing discretionary functions, they will not be held liable for their conduct unless their actions violate "clearly established statutory or constitutional rights of which a reasonable person would have known." Barnthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849 (quoting Harlow, 457 U.S. at 818). Qualified immunity shields federal and state officials from money damages unless a plaintiff pleads facts showing: 1) that the official violated a statutory or constitutional right; and 2) that the right was "clearly established" at the time of the challenged conduct. Ashcroft v. al-Kidd, 131 S. Ct. 2074, 2080, 179 L. Ed. 2d 1149 (2011); Harlow, 457 U.S. at 818-819. ¶7 This court must examine the law as it was at the time of the officials' actions in order to determine whether the law allegedly violated was clearly established. Barnthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849; Harlow, 457 U.S. at 818. The plaintiff, in the underlying action must do more than identify a clearly established right in the abstract and allege it was violated: the contours of the law must be sufficiently clear that a reasonable official would understand what he/she is doing violates the established right. Barthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849; Anderson 483 U.S. at 640. At the time of the officials' actions, existing precedent must have placed the statutory or constitutional question beyond debate. Reichle v. Howard, 132 S. Ct. 2088, 2093, 182 L. Ed. 2d 985 (2012); Ashcroft, 131 S. Ct. at 2083. Requiring the right allegedly violated to be clearly established protects a balance between the need to safeguard constitutional rights and the need for government officials to be able to effectively perform their duties by ensuring they can anticipate when their actions might violate constitutional rights. See Reichle, 132 S. Ct. at 2093; Anderson, 483 U.S. at 646. In short: Qualified immunity gives government officials breathing room to make reasonable but mistaken judgments about open legal questions, and when properly applied, it protects "all but the plainly incompetent or those who knowingly violate the law." Ashcroft, 131 S. Ct. at 2085 (quoting Malley v. Briggs, 475 U.S. 335, 341, 106 S. Ct. 1092, 1096, 89 L. Ed. 2d 271 (1986). ¶8 The First Amendment generally prohibits government officials from subjecting individuals to retaliatory actions for their speech. Hartman v. Moore, 547 U.S. 250, 256, 126 S. Ct. 1695, 1701, 164 L. Ed. 2d 441 (2006). However, the United States Supreme Court has explained the right allegedly violated must be established not as a broad general proposition, but in a particularized sense so that the contours of the right are clear to a reasonable official. Barthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849; Reichle, 132 S. Ct. at 2094. Under this standard, Appellant must demonstrate that when the Appellees interpreted the statutory exemption to exclude Appellant's vehicles, they violated a clearly established right that Appellant possessed to advertise its vehicles qualified for the tax credit. For Appellees' qualified immunity to be overcome, it would have to have been clear to a reasonable member of the tax commission that disqualifying Appellant's vehicles from the tax credit would violate Appellant's constitutional right to advertise that its vehicles qualified for the tax credit provided for in 68 O.S.Supp 2008, § 2357.22, and further that disqualifying Appellant's vehicles would somehow constitute retaliation against Appellant for advertising that its vehicles qualified. ¶9 Appellant has failed to demonstrate Appellees violated its clearly established right to freedom of speech in a manner that would enable Appellant to defeat Appellees' qualified immunity. Appellant has not demonstrated that reasonable government officials in Appellees' position would have thought they were impinging upon Appellant's freedom of speech by denying the tax credit to Appellant's customers based on Appellees' conflicting interpretation of the legislature's exclusionary language. At no point did Appellees take any action to affirmatively prevent Appellant from exercising its right to advertise freely, nor did they take any direct action against it as an entity at all. Appellees merely fulfilled their duty to interpret and apply a statutory provision granting a tax credit to certain types of LSVs and not to others. The fact that the Commission's interpretation was subsequently found to be in error would not invalidate the reasonableness of their earlier position, such as to prohibit the defense of qualified immunity: "[o]fficials are not liable for bad guesses in grey areas; they are liable for transgressing bright lines." Barnthouse, 2003 OK 42, ¶15, 73 P.3d 840, 847 (quoting Maciariello v. Sumner, 973 F.3d 295, 298 (4th Cir. 1992)). ¶10 Appellant also alleges that Appellees violated its right to equal protection of the laws as provided for in the United States Constitution by treating it, its products, and its customers differently under 68 O.S.Supp 2008, § 2357.22 than other dealers and customers, without any rational basis for the differential treatment.4 In order to defeat Appellees' qualified immunity, Appellant's right to have its vehicles treated the same as other LSVs with regard to the tax credit would need to be sufficiently clear that by interpreting the tax credit to exclude Appellant's vehicles, "every 'reasonable official would [have understood] that what he is doing violates that right.' " Reichle, 132 S. Ct. at 2093 (quoting Anderson, 483 U.S. at 640). ¶11 Title 68 O.S.Supp 2008, § 2357.22(C) specifically carves out an exception to the tax credit: "The term 'qualified electric motor vehicle property' shall not apply to vehicles known as 'golf carts,' 'go-carts' and other motor vehicles which are manufactured principally for use off the streets and highways." It is not unreasonable or beyond debate for the officials charged with construing and applying 68 O.S.Supp 2008, § 2357.22(C) to find that certain types of vehicles fell within the exclusion and others did not. Appellant may not agree with the decision making criteria used by Appellants in making their determination, and they may believe that the determination was made as a result of budgetary pressure, but they have demonstrated no precedent indicating that by making a determination which vehicles were known as "golf carts," "go-carts" and other motor vehicles which are manufactured principally for use off the streets and highways, "it would be clear to a reasonable officer that his conduct was unlawful in the situation he confronted." Wilkie v. Robbins, 551 U.S. 537, 585, 127 S. Ct. 2588, 2618 (2007). CONCLUSION ¶12 The question of whether parties to a suit possess qualified immunity is a question of law, and we review it de novo. Barnthouse, 2003 OK 42, ¶20, 73 P.3d 840, 849; Mitchell, 472 U.S. at 528; Melton, 879 F.2d at 726. As a matter of law, Appellees are entitled to the defense of qualified immunity. Appellees did not violate a clearly established constitutional right of Appellant by determining that language in 68 O.S.Supp 2008, § 2357.22(c) excluded Appellant's vehicles from the tax credit but did not exclude others. Appellees' decision, which resulted in the exclusion of certain types of vehicles from benefiting from the tax credit, including lines sold by Appellant, was based upon a reasonable interpretation of the statutory provisions. ¶13 Even though Appellees' reasonable determination was subsequently found to be erroneous, it was not the stepping across a bright line that would prevent the application of sovereign immunity. See Barnthouse, 2003 OK 42, ¶15, 73 P.3d 840, 847. "Qualified immunity gives government officials breathing room to make reasonable but mistaken judgments about open legal questions, and when properly applied, it protects all but the plainly incompetent or those who knowingly violate the law." Ashcroft, 131 S. Ct. at 2085. Inasmuch as this Court has determined the defense of qualified immunity applies and is dispositive of the underlying action, the Court need not address the remaining issues. JUDGMENT OF THE TRIAL COURT IS AFFIRMED ¶14 ALL JUSTICES CONCUR FOOTNOTES 1 68 O.S.Supp 2008, § 2357.22 provides in pertinent part: A. For tax years beginning before January 1, 2010, there shall be allowed a one-time credit against the income tax imposed by Section 2355 of this title … for investments in qualified electric motor vehicle property placed in service after December 31, 1995.…. C. As used in this section, "qualified electric motor vehicle property" means a motor vehicle originally equipped to be propelled only by electricity to the extent of the full purchase price of the vehicle; provided, if a motor vehicle is also equipped with an internal combustion engine, then such vehicle shall be considered 'qualified electric motor vehicle property' only to the extent of the portion of the basis of such motor vehicle which is attributable to the propulsion of the vehicle by electricity. The term "qualified electric motor vehicle property" shall not apply to vehicles known as "golf carts," "go-carts" and other motor vehicles which are manufactured principally for use off the streets and highways. 2 In Wilder v. Oklahoma Tax Comm'n, 2012 OK CIV APP 91, --- P.3d ----, purchasers of certain Tomberlin LSVs, sought review of a decision by the Oklahoma Tax Commission that the LSVs they purchased did not qualify for the tax credit available under 68 O.S. Supp. 2008 §2357.22(c). The Court of Appeals reversed the decision of the Oklahoma Tax Commission, holding that because the Tomberlin LSVs were originally equipped for propulsion by electricity, manufactured principally for legal use on roads, and not manufactured principally for use off the streets and highways, they qualified for the tax credit. The Oklahoma Tax Commission appealed the decision of the Court of Civil Appeals and we denied certiorari on October 1, 2012. Another case to come before the Court in this matter bears substantial similarities to this one. In Kemp et al. v. Hon. Roger H. Stuart, etc., District Court of Oklahoma County, State of Oklahoma, No. CJ-2011-6323, Petitioners Thomas Kemp, Jr., Jerry Johnson, Dawn Cash, and Rick Miller requested this Court assume original jurisdiction and issue a writ of prohibition, arguing they possessed qualified immunity from suit, after they were sued in their individual capacity by various LSV dealers asserting violations of their civil rights under 42 U.S.C. §1983, including violations of their First Amendment rights and denial of Equal Protection. We assumed original jurisdiction and issued a writ of prohibition on October 22, 2012, No. 110,767, dismissing all claims against the members of the OTC, finding that Kemp and the other members possessed qualified immunity. 3 42 U.S.C. §1983 provides: Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress, except that in any action brought against a judicial officer for an act or omission taken in such officer's judicial capacity, injunctive relief shall not be granted unless a declaratory decree was violated or declaratory relief was unavailable. For the purposes of this section, any Act of Congress applicable exclusively to the District of Columbia shall be considered to be a statute of the District of Columbia. 4 U.S. Const. amend. XIV, § 1 provides: All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

14463975-bd1d-44a4-a22b-bf2c94207575

Benson v. Leaders Life Insurance Co.

oklahoma

Oklahoma Supreme Court

BENSON v. LEADERS LIFE INSURANCE CO.2012 OK 111Case Number: 107956Decided: 12/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. SHANNON M. BENSON, Plaintiff/Appellee, v. LEADERS LIFE INSURANCE COMPANY, Defendants/Appellants. ON CERTIORARI TO THE COURT OF CIVIL APPEALS TULSA, OKLAHOMA, DIVISION IV ¶0 Certiorari was granted to review the Court of Civil Appeals opinion reversing and remanding the case. The Court of Civil appeals opinion did not apply the correct standard in this matter. This case involves a possible misstatement on an insurance application and the rescission of policy. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT'S JUDGMENT REINSTATED. Terry J. Garrett, TERRY J. GARRETT & ASSOCIATES, P.C., Norman, Oklahoma, Terry S. O'Donnell, Adam S. Weintraub, SAVAGE, O'DONNELL, AFFELDT, WEINTRAUB & JOHNSON, Tulsa, Oklahoma, for Plaintiff/Appellee James W. Rhodes, Johnny R. Blassingame, Jr., KERR, IRVINE, RHODES & ABLES, Oklahoma City Oklahoma, for Defendant/Appellant COMBS, J. ¶1 On March 24, 2005, Michael Todd Benson (Applicant) made an application to Leader Life for a $90,560.00 life insurance policy, naming his wife Shannon, as Beneficiary. The application asked if the applicant had ever been treated for liver disease, had any medical or surgical treatment in the last five years or any departure from good health and whether or not the applicant had ever had an alcohol or drug problem. Applicant answered yes to the departure from good health question and told the insurance company that he had a blood clot in his leg in October of 2003 and was treated by Dr. Mehran Shahsavari of Norman, Oklahoma. Applicant answered no to the Liver disease question and no to the alcohol question. When Leaders Life asked about the blood clot issue, Mr. Benson informed the insurance company that he had been treated for "deep vein thrombosis" and was prescribed Coumadin which he was no longer taking. Leaders Life accepted this answer and issued the underlying policy in this action. ¶2 On March 17, 2006, Applicant was on foot, pushing a stalled car out of the street when he was struck by another vehicle which eventually resulted in his death. Beneficiary filed for benefits under the policy. Leaders investigated the claim. They received the hospital records pertaining to his death, which also noted his blood alcohol at his time of death was .24 although the owner of the car testified that he smelled no alcohol on the applicant.1 ¶3 Michelle Houchin, the Underwriter and claims administrator for Leaders Life, investigated the claim in the present matter. She ordered the records from the accident and from the 2003 treatment for the deep vein thrombosis. After reviewing the records she concluded that Mr. Benson had falsified his answers on his application and rescinded the policy due to Mr. Benson's alcoholism. She testified that Leaders Life would rescind the policy even if the mistake was innocent. She further testified that the state of mind of the applicant was never considered. She also testified that alcohol played no part in Mr. Benson's death and agreed that the policy application was ambiguous in her deposition but changed that testimony at trial saying it was not ambiguous. Ms. Houchin also did not follow Leaders Life internal policy and interview the agent who assisted Mr. Benson in filling out the application for the policy. ¶4 Section 3609 of Title 36, 2005 Supp. is controlling in the instant matter. It was the law at time of the policy. It states as follows: Representations in Applications--Recovery under policy--Mortgage guaranty policies A. All statements and descriptions in any application for an insurance policy or in negotiations therefor, by or in behalf of the insured, shall be deemed to be representations and not warranties. Misrepresentations, omissions, concealment of facts, and incorrect statements shall not prevent a recovery under the policy unless: 1. Fraudulent; or 2. Material either to the acceptance of the risk, or to the hazard assumed by the insurer; or 3. The insurer in good faith would either not have issued the policy, or would not have issued a policy in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss, if the true facts had been made known to the insurer as required either by the application for the policy or otherwise. B. Subsection A of this section shall not be applicable to mortgage guaranty insurance, as hereinafter defined. Misrepresentations, omissions, concealment of facts and incorrect statements shall not prevent a recovery under a policy of mortgage guaranty insurance unless material and fraudulent. As used herein, the term "mortgage guaranty insurance" means a form of casualty or surety insurance insuring lenders against financial loss by reason of nonpayment of principal, interest and other sums agreed to be paid under the terms of any note, bond or other evidence of indebtedness secured by a mortgage, deed of trust or other instrument constituting a lien or charge on real estate which contains a residential building or a building designed to be occupied for industrial or commercial purposes. ¶5 This Court has previously discussed the aforementioned statute several times. Our first decision under §3609 was Massachusetts Mutual Life Ins. Co. v. Allen, 1965 OK 203, 416 P.2d 935, in which insurer sought to cancel a life insurance policy because when insured made application for the policy he did not disclose a previous biopsy of a lymph node and he gave incorrect statements to the agent. Beneficiary testified the biopsy was not considered significant and that the agent told insured the form was filled out correctly. The agent admitted that he put down a wrong answer on the application. ¶6 Insurer appealed and contended it was entitled to judgment as a matter of law under §3609 because the insured's misrepresentations, omissions, concealment of facts and incorrect statements were (1) fraudulent, (2) material to acceptance of the risk assumed by the company, and (3) that in good faith it would not have issued the policy if the true facts had been made known. Affirming the judgment in favor of the beneficiaries, the Court rejected insurer's views of the statute's construction and defined the statute's terms to require "intent to deceive" on the part of the insured. In the body of the opinion we quoted and adopted the following definition of misrepresentation at ¶23: "A 'misrepresentation' in insurance is a statement as a fact of something which is untrue, and which the insured states with the knowledge that it is untrue and with an intent to deceive, or which he states positively as true without knowing it to be true, and which has a tendency to mislead, where such fact in either case is material to the risk." (quoting 29 Am. Jur., Insurance at §698.)(emphasis added). "Concealment of fact" was similarly defined: "Concealment implies an intentional withholding of facts of which the insured has or should have knowledge, and the insured cannot be held to have concealed a fact of which he had no knowledge or which he had no duty or reason to know." (quoting 29 Am. Jur. Insurance at §692)(emphasis added). ¶7 In Massachusetts Mutual Life Ins. Co. v. Allen, 1965 OK 203, 416 P.2d 935, the Court's definitions of "omission" and "incorrect statement" were stated as follows: ¶0…"An 'omission' in negotiations for a life insurance policy under 36 O.S.1961, § 3609, is an intentional omission to disclose a fact or condition which is material to the acceptance of the risk or the hazard assumed. . . ." (emphasis added) "An 'incorrect statement' in negotiations for a life insurance policy under 36 O.S.1961, § 3609, is a statement of fact which is untrue and known to be untrue, or so carelessly made that an intent to deceive may be inferred." (emphasis added) ¶8 We have four times followed Massachusetts Mutual's requirement of a finding of an "intent to deceive" the insurer before a policy may be avoided by reason of the insured's false statement or omission in the application. In Whitlatch v. John Hancock Mutual Life Insurance Co., 1968 OK 6, ¶11, 441 P.2d 956, 959, the Court, reversing judgment in favor of the insurer on its motion for directed verdict, stated that Massachusetts Mutual had "defined the terms, enumerated in [§3609], which are made grounds for avoidance of a policy," and had applied the rule that questions as to the falsity of statements in an application and applicant's intent in making the statement are questions for determination by the jury, not questions of law for the court. Insurer admitted at trial that the only reference to Benson ever being told not to drink alcohol by a physician was once in 2003 while on the anticoagulant, Coumadin. Specifically, the medical record states, "[t]he risks of anticoagulation, the importance of having a close follow-up with his family physician was emphasized with the patient. The importance of quitting drinking while the patient is on Coumadin and the risks of bleeding with a fall, if the patient drinks with a gastrointestinal bleed with continued drinking was emphasized with the patient." Insurer also admitted that by the time Benson completed the policy application that he had been off Coumadin for several months nor did Insurer discuss Benson's alcohol use with his physician. ¶9 In the present matter, the Insurer presented evidence to the jury that Mr. Benson lied on his application. However, the agent who assisted Mr. Benson noted that he was in a big hurry and didn't even fill out the beneficiary portion of the application. She had to call him back and have him do it. Insurer stated that they would rescind a policy even if there was an innocent mistake made on the application, and that state of mind of the applicant is never considered. Mr. Benson filed a medical release that was never used until his death and any questions of alcohol use would have been evident had the Insurer investigated this matter properly. The issue of intent to deceive was the primary focus of the entire trial. The underwriter testified that if Mr. Benson had indicated he had liver disease they would have obtained his medical records prior to issuing a policy, however, the deep vein thrombosis was not at any time given much weight and no medical records were ordered. She also stated that if alcohol use was marked on the application they would have sent out an alcohol questionnaire, and here no policy would have ever been issued. In rendering its verdict, the jury considered all the evidence presented at trial and rendered a verdict in favor of the beneficiary. ¶10 In Brunson v. Mid-Western Life Ins. Co., 1976 OK 32, 547 P.2d 970, we quoted and approved the definition of "misrepresentation" from Massachusetts Mutual expressly requiring the intent to deceive insurer and following that rule, we affirmed the trial court's judgment in favor of insured based on his lack of intent to deceive the insurer. ¶ 20, 973. We noted that an insurer relying on the defense of misrepresentations by the insured in his application bears the burden of pleading and proving the facts necessary to sustain the defense, and that the "[q]uestion of falsity of statements . . . and intent of applicant in making them is for the jury." ¶21, 973. Finding that uncontroverted testimony in the jury-waived trial showed Brunson did not intend to deceive his insurer by his false answers, we also upheld the trial court's determination that there was "no misrepresentation" on his part. ¶10 In Claborn v. Washington National Insurance Co., 1996 OK 8, 910 P.2d 1046, we again quoted and relied on the definition of "misrepresentation" set forth in Massachusetts Mutual and Brunson explicitly requiring "intent to deceive" the insurer in order to defend against payment of policy under §3609. Based on that requirement we found that the insurer was entitled to rescission of the policy and judgment where evidence showed that the "misrepresentations made by Claborn were indeed a known falsity to Claborn." ¶11, 1049. Citing Brunson, the Claborn court stated that "[w]here evidence is conflicting, as to either insured's state of health at the time of application, or the falsity of insured's statements in the application process, or the intent of the insured, the issues are properly tendered to the jury for resolution." ¶8, 1049. ¶11 In Scottsdale Insurance Company v. Tolliver, 2005 OK 93, 127 P.3d 611, this Court received a certified question of law from the Northern District of Oklahoma pursuant to the Oklahoma Uniform Certification of Question of Law Act, 20 O.S. 2001, §§ 1601, et seq. as follows: Whether Oklahoma law requires a finding the insured intended to deceive the insurer before a misrepresentation omission or incorrect statement on an insurance application can serve as a ground to prevent recovery under the policy pursuant to Okla. State Tit. 36 §3609. See Hays v. Jackson National Life Insurance Co., 105 F.3d 583 (10th Cir. 1997). This Court directed the Federal Court to this Court's previous holdings recognizing a finding of intent to deceive to avoid a policy, as well as a jury determination as to the intent to deceive. In the present matter, the Insurer presented much evidence at trial that they would never had issued this policy had they known of Mr. Benson's alcohol use. The underwriter went to great lengths to state this fact. However, the jury considered that Insurer admitted that the policy was ambiguous, that it had examined only a portion of Mr. Benson's medical records and that Insurer's investigation sought only medical information inconsistent with the application and they did not even investigate the question of whether or not Mr. Benson intended to deceive them to obtain his insurance policy. ¶12 Massachusetts Mutual, Whitlatch, Brunson, Claborn and Scottsdale are controlling precedent from this Court requiring a finding of insured's intent to deceive an insurer before a misrepresentation, an omission or incorrect statement in an application can avoid the policy under §3609. This matter must be given to the jury for determination and when properly submitted is not an issue to be determined by this Court. In Florafax International, Inc. v. GTE Market Resources, Inc., 1997 OK 7, ¶ 3, 933 P.2d 282, this Court set forth the general appellate standard of review concerning actions at law tried to a jury. This Court said in Florafax: In an action at law, a jury verdict is conclusive as to all disputed facts and all conflicting statements, and where there is any competent evidence reasonably tending to support the verdict of the jury, this Court will not disturb the jury's verdict or the trial court's judgment based thereon. Where such competent evidence exists, and no prejudicial errors are shown in the trial court's instructions to the jury or rulings on legal questions presented during trial, the verdict will not be disturbed on appeal. In an appeal from a case tried and decided by a jury an appellate court's duty is not to weigh the evidence and determine which side produced evidence of greater weight, i.e. it is not an appellate court's function to decide where the preponderance of the evidence lies - that job in our system of justice has been reposed in the jury. In a jury-tried case, it is the jury that acts as the exclusive arbiter of the credibility of the witnesses. Finally, the sufficiency of the evidence to sustain a judgment in an action of legal cognizance is determined by an appellate court in light of the evidence tending to support it, together with every reasonable inference deducible therefrom, rejecting all evidence adduced by the adverse party which conflicts with it. 1997 OK 7, ¶ 3, 933 P.2d at 287 (citations omitted). ¶13 In plain language, we are not allowed to substitute our judgment for that of the jury merely because we would have decided or viewed disputed material fact questions differently than the jury. Where competent evidence was presented at trial to support reasonable findings as to those material fact questions relating to the claim in suit and no reversible error is otherwise shown, an appellate court must affirm a judgment based on a jury verdict, not second-guess such judgment or the jury verdict upon which it is based. These general principles guide our review here. ¶14 In the present matter, at trial, Leaders Life made clear that they believed there were material misrepresentations made by Mr. Benson. They argued that insured had attempted to deceive them. However, the trier of fact, the jury did not find that such a misrepresentation had been made. They decided in favor of the beneficiary, Shannon Benson and awarded her $350,000.00 dollars in actual damages and $10,000.00 in punitive damages. In the present matter, Mr. Benson did not die from an alcohol related illness; he died by being hit by a car attempting to assist a stranded motorist. If he had ignored the stranded motorist, Mr. Willige, Mr. Benson would have not been struck and may still be alive and working today. This Court cannot substitute its judgment for that of the jury under the case law presented in this lawsuit. Brunson v. Mid-Western Life Ins. Co., 1976 OK 32, ¶21, 547 P.2d 970; Whitlatch v. John Hancock Mutual Life Insurance Co., 1968 OK 6, ¶11, 441 P.2d 956; Scottsdale Insurance Company v. Tolliver, 2005 OK 93, ¶11, 127 P.3d 611. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT'S JUDGMENT REINSTATED. ¶15 COLBERT, V.C.J., KAUGER, WATT, EDMONDSON, REIF, COMBS, GURICH, JJ. concur TAYLOR, C.J., WINCHESTER, J., dissent ¶16 TAYLOR, C.J. with whom WINCHESTER, J. joins dissenting I would affirm the unanimous Court of Civil Appeals. Mr. Benson was asked very specific and material questions on this life insurance application. It is undisputed that he did not answer those important questions truthfully. His estate should not benefit from this deception. Title 36 O.S. 2011, Section 3609. He did not tell the truth and now the insurance company has to pay bad faith punitive damages. What is wrong with this picture? FOOTNOTES 1 Mr. Willige testified that he was two feet away from Mr. Benson and that he smelled no alcohol from Mr. Benson. (Tr. 390-391.) Additionally, in the present matter the Court of Civil Appeals relied on evidence not allowed at trial in its decision. The Court of Civil Appeals cites undisputed evidence that an arrest for public intoxication and treatment for alcohol dependency which were never sought or considered by Insurer during its claims investigation. This evidence was not admitted into evidence at trial and the admissibility is not the subject of this appeal. The Court of Civil Appeals also noted that the car being pushed by Mr. Benson was stuck in a snow bank. It was not, the car was out of gas. (Tr. 388)

06ec2f77-1cbb-4ff4-8a24-6c2dbcc94a08

Smith v. Villareal

oklahoma

Oklahoma Supreme Court

SMITH v. VILLAREAL2012 OK 114Case Number: 108829Decided: 12/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN RE THE MARRIAGE OF: MARY ELIAS SMITH, Petitioner/Appellee, v. MOREY J. VILLAREAL, Respondent/Appellant. CERTIORARI TO THE COURT OF CIVIL APPEALS DIVISION II Honorable Carl Funderburk, Trial Judge ¶0 Petitioner wife filed a Petition for Dissolution of Marriage from husband on January 4, 2007. The trial court disposed of the marital estate and found it to include the third home the parties occupied during marriage as well as two rental properties the husband purchased with his separate funds for the benefit of his two daughters from a previous marriage. Husband appealed the trial court's ruling and the Court of Civil Appeals affirmed. We granted certiorari to address the issue of whether the trial court's inclusion of the two rental properties as part of the marital estate was against the clear weight of the evidence. We hold that: 1) the husband rebutted the presumption by clear and convincing evidence that the two rental properties, purchased with the husband's separate funds, were intended as a gift to the marital estate because husband and wife took title as joint tenants; and 2) as a result their inclusion by the trial court in the marital estate was against the clear weight of the evidence. CERTIORARI PREVIOUSLY GRANTED; OPINION OF COURT OF CIVIL APPEALS VACATED; AFFIRMED IN PART, REVERSED IN PART, AND REMANDED. William G. LaSorsa, Sara C. Smith, Tulsa, Oklahoma, for Petitioner/Appellee. Joseph R. Farris, Curtis R. Roberts, Tulsa, Oklahoma, for Respondent/Appellant. KAUGER, J.: ¶1 The dispositive issue presented is whether two properties purchased by husband using his separate funds for the benefit of his two daughters from a previous marriage were properly included within the marital estate by the trial court. Because husband provided clear and convincing evidence that it was not his intent that the rental properties be included in the marital estate, or even that the property be acquired in joint tenancy in the first place, husband successfully rebutted the presumption that a gift is assumed when real property purchased with the separate property of one spouse is acquired in joint tenancy by both spouses. The decision of the trial court that the two rental properties constituted part of the marital estate was against the clear weight of the evidence. The trial court's disposition of the remainder of the marital estate and the inclusion of the third marital home is affirmed. FACTS ¶2 Morey J. Villareal (husband) appeals a decision of the Court of Civil Appeals affirming the trial court's September 21, 2010, decree of divorce which divided the marital estate between himself and Mary E. Smith (wife). They were married on November 22, 2003. The parties filed for divorce on January 4, 2007, although they did attempt reconciliation for a time after filing. Wife moved out of the parties' home on January 8, 2008, and the parties resumed divorce proceedings in the trial court. They had no children together. ¶3 During the marriage, the parties lived in three successive homes. The first home was purchased before the marriage using a combination of a mortgage, as well as proceeds from the sale of husband's previous separate home and money from his personal investment account. Twice during the marriage, the couple "traded up," purchasing new homes in part with funds from the sale of the previous home, combined with new mortgages. Husband made mortgage payments on the homes and improvements on them using earnings from his business which were held in his personal trust. ¶4 After the initial start of divorce proceedings, but during the period of attempted reconciliation, husband purchased two homes for his daughters from a prior marriage in June and October of 2007. The husband paid for these homes with his separate property, consisting of the proceeds from the sale of his parents' home. Wife does not dispute that the properties were purchased with husband's separate funds. However, both husband's and wife's names appear on the warranty deeds, signed by the sellers of the properties and notarized. Pursuant to the deed, husband and wife took title to the properties as joint tenants. ¶5 The divorce decree, entered on July 19, 2010, found the parties' third home, and the two homes purchased for the benefit of husband's two daughters by a previous marriage, to be included within the divisible marital estate.1 Husband appealed the ruling of the district court that the marital homes and two rental properties were part of the marital estate, and the Court of Civil Appeals affirmed the decision on August 28, 2012. Husband filed his Petition for Certiorari with this Court on September 17, 2012. I. Clear and Convincing Evidence Exists That Husband Did Not Intend a Gift to the Marital Estate When He Purchased Two Properties With His Separate Funds for the Benefit of His Daughters, Even Though Husband and Wife Took Title as Joint Tenants. ¶6 The trial court erred in holding that because husband and wife took title to the two rental properties as joint tenants, the properties automatically became part of the divisible marital estate. Clear and convincing evidence exists that indicates husband did not intend the two rental properties to become marital property. Despite husband and wife taking title as joint tenants, he rebutted the presumption of a gift that arises when spouses take title as joint tenants to property acquired with separate funds or originally held separately. The ruling of the trial court regarding the two rental properties was against the clear weight of the evidence indicating that husband did not intend a gift to the marital estate. ¶7 A divorce suit is one of equitable cognizance in which the trial court has discretionary power to divide the marital estate.2 In an action of equitable cognizance there is a presumption in favor of the trial court's findings and they will not be set aside unless the trial court abused its discretion or the finding is against the clear weight of the evidence.3 ¶8 Title 43 O.S. 2006 §121 requires a fair and equitable division of property acquired during the marriage by the joint industry of a husband and wife.4 Jointly-acquired property is that which is accumulated by the joint industry of the spouses during the marriage.5 The determination of the issue as to separate ownership of property acquired during the marriage is dependent on the original source of the property.6 Wife does not dispute that the two rental properties were purchased with separate property of the husband. ¶9 A transfer by one spouse of separate property to another does not by itself erase the separate character of the asset or real property transferred; rather, the original ownership regime must be respected unless there is proof of an interspousal gift.7 The law provides a rebuttable presumption of a gift where title to separately held real estate is placed by one owner-spouse in both spouses' names as joint tenants.8 This presumption arises even if the property in question was purchased with one spouse's separate funds, as in this case.9 ¶10 The presumption in favor of a gift can be overcome by clear and convincing evidence of contrary intent, including evidence of a purpose for placing the property in joint tenancy that is collateral to making a gift.10 In Larman v. Larman, 1999 OK 83, 991 P.2d 536, the Court held that the presumption of a gift was overcome where the wife included the husband's name upon deeds as a joint tenant to property she held separately for the sole purpose of refinancing the mortgage loans on both properties, because the lender required that in order to qualify, both spouses had to be record owners and sign the loan related documents.11 In Larman, the wife spoke to a loan officer about refinancing, and the officer advised her that the loans could not be made if title to both the properties remained solely in her name.12 The lending institution prepared the deeds and mortgages, which were then signed by both spouses. The deeds conveyed title to them in the properties at issue as joint tenants.13 ¶11 The husband in Larman confirmed by his testimony that: 1) the wife did not tell him she was making a gift to him of her inherited real estate; 2) he was not aware that the property was in joint tenancy or that he even had a claim of ownership in it until after his wife had commenced the divorce action; and 3) the husband first learned he was listed on the three deeds as a joint tenant when, at the suggestion of counsel, he obtained a copy of the documents.14 ¶12 Clear and convincing evidence exists in this cause that the husband did not possess donative intent when title was conveyed to both spouses in joint tenancy. Husband provides ample evidence beyond his own testimony indicating why the inclusion in the divisible marital estate by the trial court of the two rental properties purchased for his daughters was an error, and something that he did not intend. Husband argues that the closing company in charge of handling the transaction erroneously placed the properties in joint tenancy, against his intent. During trial, Husband called Larry Johnson, President of Guaranty Abstract Company (Guaranty), to testify regarding the two properties purchased for Husband's daughters. Johnson stated that in his review of Guaranty's files, that he did not find any instructions or other indications that either one of the properties was to be acquired by Husband and Wife jointly.15 In his view, the placing of the properties in joint tenancy on the Warranty Deed was a mistake made by Guaranty. He stated during trial: Q: With respect to the two rental properties we talked about however, the deeds that Guarantee Abstract prepared and that were field were not done consistent with what you were supposed to do? A: That is correct16 ¶13 During cross-examination, Johnson did state that he was not present personally when either of the closings took place.17 He stated that during closing, the buyer is presented with a deed or at least some document that asks the buyer how he or she wants to take title.18 In other words, theoretically the buyer knows how they will be taking title. Johnson stated that nothing in the records indicated that Husband complained or thought anything was wrong at the time the two closings were completed for the properties purchased for his two daughters.19 ¶14 However, Mr. Johnson's testimony concerning Guaranty's error and its accompanying caveats are not the only evidence indicating that husband never intended the two rental properties to become marital property. In a sworn affidavit, a Vice-President of F&M Bank & Trust Company, who handled the mortgage on one of the rental properties, stated that as part of the subject transaction, wife was required to sign the mortgage on the property, despite the fact that the application indicated that husband was to take title to the property in his individual name.20 Another employee of F&M Bank & Trust Company, Debra Lee, handled the mortgage on the second rental property and also submitted a sworn affidavit. It confirms the same facts for the second property: that husband was to take title in his individual name, that his spouse's signature was required to sign the mortgage, and that the buyer and borrower were to be husband individually.21 ¶15 The Oklahoma Uniform Contracts of Sale of Real Estate for both properties indicate that the buyer was listed as the Morey J. Villareal Revocable Trust.22 The Uniform Residential Loan Applications from F&M Bank and Trust for both properties indicate that title was to be held by Morey J. Villareal, A Married Person and further indicate that the borrower for both loans was to be Morey J. Villareal.23 The Preliminary Setup Instructions document for the loan on one of the properties, from F & M Bank and Trust, specifically states: "Additional Instructions: This is a non owner occupied, Walter & Assoc. has sell side. He is married but wife is not on loan or app. She does not have to sign, right??? Please confirm."24 The closing information documents from F & M Bank and Trust for both properties list as the borrower only Morey J. Villareal.25 ¶16 In short, there is clear and convincing evidence in the record indicating that husband intended to be the sole owner of the two rental properties in question when they were purchased, and had no intention of his wife being included on the deeds in joint tenancy. Wife asserts that these two rental properties were marital property, in spite of all the above evidence indicating to the contrary because: 1) the deeds prepared by Guaranty, not signed by either husband or wife and indicating no donative intent, convey both properties in joint tenancy; and 2) even though divorce proceedings had begun, the parties were involved in reconciliation when the properties were purchased.26 The trial court agreed, holding that it was bound by the deeds indicating joint tenancy because the parties signed them.27 That decision was erroneous. First, neither spouse signed the warranty deeds conveying the two properties; they were signed by the sellers. Second, spouses taking title as joint tenants only gives rise to the rebuttable presumption of a gift to the marital estate, if the property was originally held as separate property.28 The logic of this rule applies equally to property that is purchased during marriage with the separate funds of one spouse, even if it was not already itself held as separate property. The presumption that husband intended the two rental properties purchased with his separate funds to become part of the marital estate is rebuttable by clear and convincing evidence of a different intent,29 evidence which husband has provided. CONCLUSION ¶17 A divorce suit is one of equitable cognizance in which the trial court has discretionary power to divide the marital estate.30 In an action of equitable cognizance there is a presumption in favor of the trial court's findings and they will not be set aside unless the trial court abused its discretion or the finding is against the clear weight of the evidence.31 ¶18 The trial court's determination that the two rental properties purchased by Husband for the benefit of his daughters were part of the marital estate was erroneous because it was against the clear weight of the evidence. Clear and convincing evidence in the record indicated that husband never intended the two rental properties to become marital property, sufficient to rebut the presumption that a gift was intended despite the fact that husband and wife took title as joint tenants. Because the record does not indicate that the rest of the trial court's disposition of the marital estate was against the clear weight of the evidence, we affirm the remainder of the trial court's ruling and remand for proceedings consistent with this opinion. The wife's application for attorney fees is denied. CERTIORARI PREVIOUSLY GRANTED; OPINION OF COURT OF CIVIL APPEALS VACATED; AFFIRMED IN PART, REVERSED IN PART, AND REMANDED. CONCUR: TAYLOR, C.J., COLBERT, V.C.J., KAUGER, WATT, EDMONDSON, REIF, JJ. DISSENT: WINCHESTER, COMBS, GURICH, JJ. FOOTNOTES 1 The trial court made the following ruling concerning the two rental properties, which were currently being leased by the husband's daughters: The other issue is this - the two rental properties, and the Court struggles with this issue. And it's during the reconciliation period, not - it's after filing of divorce. It was made in joint tenancy and the respondent signed these documents and which [sic] puts them in joint tenancy. They - it's a mistake, whatever, but it's still a business document that the four corners say that petitioner and respondent were going to own these properties in joint tenancy. And I don't feel that Mr. - the Guaranty president comes and says we made that mistake. Well, that's going to be a contract issue. I have to go by what the - I mean, whether it is or not, I have to go by what he signed and what - yeah, I closed on some houses and I'm not sure I read everything that I sign when I do a mortgage, but it would also be to my detriment that I sign those and don't carefully read them. And he signed those things. I don't see how we can get around - these were during the reconciliation period. They were made in joint tenancy, and I'm going to find that they were - I'm going to find that they were just as the Rockford all the other homes that were in his - were just in his name other than - well, this one was joint tenancy. The one that was made in joint tenancy for 10 minutes and got put into the revocable trust, the Court has no problem with that because the revocable trust was for the benefit of both parties based on that they had. So I'm going to include the two rental properties as joint industry. Transcript of the Trial Court's Ruling of July 19, 2010, at p. 12. 2 Jackson v. Jackson, 1999 OK 99, ¶7, 995 P.2d 1109; Larman v. Larman, 1999 OK 83, ¶17, 991 P.2d. 536; Teel v. Teel,1988 OK 151, ¶7, 766 P.2d 994, 998. 3 Francis v. Rogers, 2001 OK 111, ¶24 n. 22, 40 P.3d 481; Groseclose v. City of Tulsa, 1998 OK 112, ¶18, 990 P.2d 828; Krosmico v. Pettit, 1998 OK 90, ¶23, 968 P.2d 345. 4 Title 43 O.S. 2006 §121(B), in effect at the time divorce proceedings were initiated, provides: B. The court shall enter its decree confirming in each spouse the property owned by him or her before marriage and the undisposed-of property acquired after marriage by him or her in his or her own right. Either spouse may be allowed such alimony out of real and personal property of the other as the court shall think reasonable, having due regard to the value of such property at the time of the divorce. Alimony may be allowed from real or personal property, or both, or in the form of money judgment, payable either in gross or in installments, as the court may deem just and equitable. As to such property, whether real or personal, which has been acquired by the parties jointly during their marriage, whether the title thereto be in either or both of said parties, the court shall, subject to a valid antenuptial contract in writing, make such division between the parties as may appear just and reasonable, by a division of the property in kind, or by setting the same apart to one of the parties, and requiring the other thereof to be paid such sum as may be just and proper to effect a fair and just division thereof. The court may set apart a portion of the separate estate of a spouse to the other spouse for the support of the children of the marriage where custody resides with that spouse. 5 Thielenhaus v. Thielenhaus, 1995 OK 5, ¶9, 890 P.2d 925; Williams v. Williams, 1967 OK 97, ¶¶16-21, 428 P.2d 218. 6 Longmire v. Longmire, 1962 OK 219, ¶9, 376 P.2d 273; Spencer v. Spencer, 1947 OK 243, ¶8, 184 P.2d 761. 7 Larman v. Larman, 1999 OK 83, ¶8, 991 P.2d 536. 8 Larman v. Larman, see note 7, supra at ¶9; Chastain v. Posey, 1983 OK 46. ¶8, 665 P.2d 1179; Fletcher v. Fletcher, 1952 OK 28, ¶14-15, 244 P.2d 827. 9 Chastain v. Posey, see note 8, supra at ¶8; Mendenhall v. Walters, 1916 OK 524, ¶10, 157 P. 732. 10 Larman v. Larman, see note 7, supra at ¶9-10. 11 Larman v. Larman, see note 7, supra at ¶5. ("In short, where, as here, the 'owning spouse' is unable to refinance mortgaged property because the lender requires that, in order to qualify for a loan, both spouses be record owners and sign the loan-related documents the presumption of a gift (arising from a joint-tenancy ownership regime) is overcome."). 12 Larman v. Larman, see note 7, supra at ¶12. 13 Larman v. Larman, see note 7, supra at ¶12. 14 Larman v. Larman, see note 7, supra at ¶14. 15 Tr. Vol. IV, July 12 and 19, 2010, at pp. 125, 130. 16 Tr. Vol. IV, July 12 and 19, 2010, at p. 136-37. 17 Tr. Vol. IV, July 12 and 19, 2010, at p. 140. 18 Tr. Vol. IV, July 12 and 19, 2010, at pp. 138-39. 19 Tr. Vol. IV, July 12 and 19, 2010, at pp. 140-41. 20 R. 562, Ex. M. 21 R. 572, Ex. N. 22 Uniform Contracts for Sale of Real Estate, Respondent's Trial Exhibits, No. 5 and Respondent's Trial Exhibits, No. 6. 23 Uniform Residential Loan Applications, Respondent's Trial Exhibits, No. 5 and Respondent's Trial Exhibits, No. 6. 24 Preliminary Setup Instructions, Respondent's Trial Exhibits, No. 5. 25 F & M Bank Closing Information, Respondent's Trial Exhibits, No. 5 and Respondent's Trial Exhibits, No. 6. 26 Appellee's Response to Appellant's Brief in Chief, pp. 7-8. 27 See discussion, supra, at ¶5. 28 Larman v. Larman, see note 7, supra at ¶9; Chastain v. Posey, see note 8, supra at ¶8; Fletcher v. Fletcher, see note 8, supra. 29 Larman v. Larman, see note 7, supra at ¶9. 30 Jackson v. Jackson, see note 2, supra at ¶7; Larman v. Larman, see note 2, supra at ¶17; Teel v. Teel, see note 2, supra at ¶7. 31 Francis v. Rogers, see note 3, supra at ¶24 n. 22; Groseclose v. City of Tulsa, see note 3, supra at ¶18; Krosmico v. Pettit, note 3, see supra at ¶23.

65288fe5-95dc-4549-8d35-de7c10b37ec1

In the matter of the Estate of Bell-Levine

oklahoma

Oklahoma Supreme Court

IN THE MATTER OF THE ESTATE OF BELL-LEVINE2012 OK 112Case Number: 106821Decided: 12/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN THE MATTER OF THE ESTATE OF PATRICIA BELL-LEVINE, Deceased, THE ESTATE OF PATRICIA BELL-LEVINE, Appellee,v.STATE OF OKLAHOMA, ex rel., OKLAHOMA TAX COMMISSION, Appellant. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION II,ON APPEAL FROM THE DISTRICT COURT OF GRADY COUNTY, STATE OF OKLAHOMA, HONORABLE TIMOTHY A. BRAUER ¶0 The Oklahoma Tax Commission appealed a ruling by the District Court of Grady County, Honorable Timothy A. Brauer, which found Decedent's outstanding 1978-1985 income tax liability was barred from collection through Decedent's probate case. The trial court's ruling was based on the ten-year limitation imposed by 68 O.S. 2001 § 223(A). The Court of Civil Appeals reversed, concluding 68 O.S. 2001 § 223(A) operated as a statute of limitations and did not violate the Oklahoma Constitution; however, COCA also found that the Oklahoma probate code required satisfaction of the tax debt before distribution of the estate assets. We find COCA correctly held that 68 O.S. 2001 § 223(A) is a statute of limitations and does not extinguish an underlying debt to the state in violation Article 5, § 53 of the Oklahoma Constitution. However, we conclude that neither 58 O.S. 2001 § 591 nor 58 O.S. 2001 § 635 of the probate code require payment of a debt otherwise barred by the statute of limitations. THE COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICTCOURT'S FEBRUARY 3, 2009 ORDER REINSTATED; MATTER REMANDED FOR FURTHER PROCEEDINGS Charles N. Woodward, Lisle & Woodward, Oklahoma City, Oklahoma, for AppelleeRobert J. Hays, Hayes & Gordon, PLLC, Chickasha, Oklahoma, for AppelleeMarjorie L. Welch, Julie M. Ezell, Geoffrey D. Long, Oklahoma Tax Commission, Oklahoma City, Oklahoma, for Appellant. GURICH, J. Facts and Procedural History ¶1 Patricia Bell-Levine died testate on April 9, 2006. Decedent's son, Michael Allen Bell filed a probate proceeding in Grady County on May 18, 2006. Bell was appointed personal representative of the estate without objection. On September 12, 2008, Bell filed a Petition for Release of Estate Tax Liability, which sought a determination from the trial judge that no estate tax was due. Following the procedure outlined in 58 O.S. 2001 § 282.1, Bell set the matter for hearing and served notice on the Tax Commission.1 The Tax Commission filed an objection to the petition based solely on Decedent's unpaid income tax liabilities. The Tax Commission also presented a Notice of Outstanding Tax Liability in the probate case, which reflected an income tax debt of $11,133.00 for the years 1978-1985, and $603.00 for years 1992, 1997, and 1998.2 Together with penalties and interest, the Tax Commission alleged Decedent had accumulated an income tax obligation of $57,182.58 and urged the trial court to require payment of all unpaid income taxes prior to allowing any distribution of estate assets. ¶2 Bell responded to the Tax Commission's pleadings, filing an Objection to Notice of Outstanding Tax Liability. Bell argued that the ten-year limitation period in 68 O.S. 2001 § 223(A) barred the Tax Commission's efforts to collect the 1978-1985 tax debt by pursuing the claim in Decedent's probate proceeding. Nevertheless, Bell voluntarily paid the tax bill for the years 1992, 1997, and 1998, utilizing a payment option specified in the Clean Slate '08 Voluntary Compliance Initiative.3 Bell's objection did not challenge the Tax Commission's assessment of the 1978-1985 income tax liability; rather his protest relied solely on the ten-year limitation period in 68 O.S. 2001 § 223(A). ¶ 3 Despite the Tax Commission's objection, the trial judge sustained Bell's petition, finding no estate tax liability. An Order Releasing Estate Tax Liability was filed on November 10, 2008, but it did not determine the validity of the alleged income tax debt. After a subsequent hearing, the trial judge entered an order on January 8, 2009, concluding the tax assessments for 1978 through 1985 could not be collected in the probate proceeding because of the limitations period in 68 O.S. 2001 § 223(A). ¶4 The Tax Commission appealed the January 8, 2009 order.4 COCA reversed, holding (1) Article 5, § 53 of the Oklahoma Constitution forbids the Legislature from enacting any law which releases or extinguishes a debt owed to the State of Oklahoma; (2) 68 O.S. 2001 § 223(A) must be interpreted as a statute of limitations, which extinguishes only the remedy, not the underlying tax obligation; and (3) the existing tax debt could be collected in the probate proceeding according to the terms of decedent's will and the statutory requirements imposed by 58 O.S. 2001 § 591 and 58 O.S. 2001 § 635 of the probate code. Bell petitioned this Court for review, and we granted certiorari on May 3, 2010, to address this first-impression controversy. Standard of Review ¶5 Whether the time limit of 68 O.S. 2001 § 223(A) prohibits collection of outstanding income tax liability through a probate proceeding after passage of the ten-year limitations period presents a question of law which we review de novo. Duncan v. Okla. Dept. of Corrections, 2004 OK 58, ¶ 3, 95 P.3d 1076, 1078. Likewise, whether the terms of 68 O.S. 2001 § 223(A) violate Article 5, § 53 of the Oklahoma Constitution by extinguishing a debt owed to the state, also presents a question of law, reviewable under the de novo standard. EOG Res. Mktg., Inc. v. Okla. State Bd. of Equalization, 2008 OK 95, ¶ 13, 196 P.3d 511, 518-19. The de novo standard necessitates a plenary, independent, and non-deferential examination of the trial court's legal rulings. White v. Heng Ly Lim, 2009 OK 79, ¶ 2, n.5, 224 P.3d 679, 681. Analysis ¶6 This case requires us to interpret and balance three statutory provisions: 68 O.S. 2001 § 223(A), 58 O.S. 2001 § 635, and 58 O.S. 2001 § 591. It also mandates consideration of these sections in light of Article 5, § 53 of the Oklahoma Constitution. ¶7 Bell maintains that the plain language of 68 O.S. 2001 § 223(A)--which authorizes taxes to be collected through a court proceeding only if commenced within ten (10) years after an assessment of tax has become final--applies to all court proceedings, regardless of who initiates the action. According to Bell, because a probate matter is a court proceeding, the plain terms of 68 O.S. 2001 § 223(A) prohibit any efforts to collect the Decedent's tax liability through the probate case. Further, Bell asserts the delinquent taxes are not an enforceable debt of the estate. Because both 58 O.S. 2001 § 591 and 58 O.S. 2001 § 635 apply to income and estate taxes due the state, Bell claims the probate code does not mandate payment of a debt otherwise barred by the applicable statute of limitations. ¶8 The Tax Commission argues that 68 O.S. 2001 § 223(A) places a ten-year limitation solely upon the issuance of a tax warrant or a court proceeding which the agency initiates against a taxpayer. Further, the Tax Commission contends that the limitation period does not preclude collection by other methods, including through submission of a claim in a probate proceeding.5 Finally, the Tax Commission contends the application of 68 O.S. 2001 § 223(A) extinguishes Decedent's tax debt in violation of Article 5, § 53 of the Oklahoma Constitution. 68 O.S. 2001 § 223(A) Does Not Extinguish a Debt to the State in Violation of Article 5, § 53 ¶9 Article 5, § 53 provides: Except as to tax and assessment charges against real property remaining delinquent and unpaid for a period of time as long or longer than that provided by law to authorize the taking title to real property by prescription, the Legislature shall have no power to release or extinguish, or to authorize the releasing or extinguishing, in whole or in part, the indebtedness, liabilities, or obligations of any corporation or individual, to this State, or any county or other municipal corporation thereof. The relevant portion of 68 O.S. 2001 § 223(A) reads as follows: No assessment of any tax levied under the provisions of any state tax law except as provided in this section, shall be made after the expiration of three (3) years from the date the return was required to be filed or the date the return was filed, whichever period expires the later, and no proceedings by tax warrant or in court without the previous assessment for the collection of such tax shall be begun after the expiration of such period. . . . If the assessment has been made within the limitation period set forth in this subsection, the tax may be collected by tax warrant or court proceeding, but only if the tax warrant is issued or the proceeding begun within ten (10) years after the assessment of the tax has become final. (emphasis added). A legislative enactment that neither extinguishes nor releases an obligation owed to the state does not conflict with the terms of Article 5, § 53 of the Oklahoma Constitution. See, e.g., Charles Banfield Co. v. State of Okla. ex rel. Fallis, 1974 OK 92, ¶ 21, 525 P.2d 638, 640 (holding a dormancy statute extinguishing a lien terminated the remedy not the underlying obligation, and did not violate Article 5, § 53). Legislative enactments are presumed constitutional. Jacobs Ranch, L.L.C. v. Smith, 2006 OK 34, ¶ 18, 148 P.3d 842, 848. When feasible, this Court construes statutes in a manner "so as to uphold their constitutionality." Rural Water Sewer and Solid Waste Mgmt., Dist. No. 1, Logan Cnty., Okla. v. City of Guthrie, 2010 OK 51, ¶ 15, 253 P.3d 38, 45 (internal citation omitted). ¶ 10 We have previously applied statutory limitation periods to preclude claims raised by the State of Oklahoma. For example, in State of Oklahoma ex rel. Central State Griffin Memorial Hospital v. Reed, 1972 OK 14, 493 P.2d 815, we determined a state claim for medical expenses incurred by a decedent's wife was barred from collection under the probate code. In that case, a state medical provider presented a claim for outstanding bills more than three years after the administrator published notice to creditors. Id. ¶ 12, 493 P.2d at 817. In defense of its claim for repayment, the state alleged it was immune from application of the time limits imposed by 58 O.S. 1961 § 333.6 Id. ¶ 13, 493 P.2d at 817. Rejecting this argument, we concluded the legislative body intended for the procedures and time limits for creditor's claims to apply equally to the State of Oklahoma. Id. ¶ 19, 493 P.2d at 818-819. ¶11 In City of Claremore v. Okla. Tax Comm'n, we held a statutory time limit for assessing sales taxes was binding on the State and did not offend the Oklahoma Constitution.7 City of Claremore v. Okla. Tax Comm'n 1946 OK 122, ¶¶ 26-33, 169 P.2d 299, 304-05; see also In re Income Tax Protest of F & M Bancorporation and Subsidiaries, 2005 OK CIV APP 6, ¶ 8, 105 P.3d 837, 839 (applying the 68 O.S. 2001 § 223 time limit to prohibit the Tax Commission from attempting to assess tax liability more than three years from the date of filing the relevant tax returns).8 ¶12 The purpose behind Article 5, § 53 was to eliminate the passage of special laws designed to exonerate political constituents from public debt. see State ex rel. Schones v. Town of Canute, 1993 OK 90, 858 P.2d 436, 442-443 (Opala, J., dissenting ¶ 5) (decision abrogated by statute); see also 20 C.J.S. § 319, n.16 (2012). Title 68 O.S. 2001 § 223(A) is clearly not such an enactment. The provision is a statute of limitations, which merely withholds a party's remedy; it does not destroy the underlying claim or debt.9 Because 68 O.S. 2001 § 223(A) does not extinguish Decedent's tax obligation, its terms do not transgress Oklahoma's constitutional restrictions. 58 O.S. 2001 § 591 and 58 O.S. 2001 § 635 Do Not Require Payment of a Debt OtherwiseBarred by the Statute of Limitations ¶13 We next address the interplay among 68 O.S. 2001 § 223(A), 58 O.S. 2001 § 635, and 58 O.S. 2001 § 591. When interpreting an apparent conflict or inconsistency among multiple statutory enactments dealing with the same subject matter, we are required to view them "together as a harmonious whole so as to give effect to each provision." McNeill v. City of Tulsa, 1998 OK 2, ¶ 9, 953 P.2d 329, 332 (citing Abbott v. Board of Trustees of Oscar Rose Junior College, 1978 OK 129, ¶ 7, 586 P.2d 1098, 1101). ¶14 Although at first blush there appears to be a conflict among these provisions, no conflict exists when the statues are viewed as a whole. The period of limitation in 68 O.S. 2001 § 223(A) specifically operates to bar the collection of assessed taxes through a court proceeding if the proceeding is not commenced within ten years of the assessment. The Tax Commission did not perfect a tax warrant or attempt to collect the 1978-1985 liability in a court proceeding within ten years of the assessment. Although barred from filing its own court proceeding, the Tax Commission suggests its right to litigate the claim was somehow revived by Bell's subsequent filing of Decedent's probate proceeding in 2006. ¶15 While the probate of an individual's estate is a court proceeding, the Bell probate proceeding was not filed within the ten-year statute of limitations. To hold that the probate code requires payment of a decedent's tax liability, regardless of the time limit imposed by the Legislature in 68 O.S. 2001 § 223(A), would render the terms of that statute meaningless. We decline to adopt such an interpretation. ¶16 This Court's decision in Brogden v. Baugh, 1936 OK 244, ¶ 23, 55 P.2d 994, 997, further supports our reading of these statutes. In Brogden we said the purpose of 58 O.S. 2001 § 591 "is to establish priority of legal and enforceable debts against the estate of a deceased person, and [it] does not create liability." Id. ¶ 22, 55 P.2d at 997 (emphasis added). A claim against a decedent's estate cannot properly be allowed unless the debt originally created remains enforceable. Id. ¶ 23, 55 P.2d at 997. A debt barred by the statute of limitations cannot form the basis of a claim presented in a probate estate. Id. As in Brogden, the Tax Commission cannot circumvent the time constraints of 68 O.S. 2001 § 223(A), by attempting to assert a claim in Decedent's probate case; such a demand is not permissible unless the debt originally created remains enforceable. Conclusion ¶17 We conclude that 68 O.S. 2001 § 223(A) is a statute of limitations and does not extinguish the underlying debt to the state, and that neither 58 O.S. 2001 § 591 nor 58 O.S. 2001 § 635 of the probate code require payment of a debt otherwise barred by the statute of limitations. The trial judge correctly determined 68 O.S. 2001 § 223(A) precludes collection of Decedent's outstanding income tax liability through the Grady County probate proceeding. THE COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICTCOURT'S FEBRUARY 3, 2009 ORDER REINSTATED; MATTERREMANDED FOR FURTHER PROCEEDINGS ¶18 WINCHESTER, EDMONDSON, REIF, COMBS, GURICH, JJ. - CONCUR ¶19 KAUGER, J. - CONCURS IN RESULT ¶20 TAYLOR, C.J., COLBERT, V.C.J, WATT, J. - DISSENT FOOTNOTES 1 Title 58 O.S. 2001 § 282.1 reads: If it appears there is no possibility that estate tax is due under the provisions of Sections 801 et seq. of Title 68, the executor or administrator of an estate or a surviving joint tenant or remainderman may request the district court to enter an order releasing estate tax liability. Such request may be included in a petition for distribution, in a petition to judicially determine the death of a joint tenant or life tenant or may be made by separate petition. Such request shall be set for hearing and notice thereof shall be given by certified mail to the Tax Commission at least thirty (30) days before the hearing. The notice shall have attached thereto a statement, verified by the requesting party, containing the description of the property claimed not to be subject to taxation, the recipient thereof, their relationship to the deceased, and an estimate of the value of the property. The Tax Commission may appear at such hearing to object to the issuance of such order, or may file a written objection with the court. If the court finds that no possibility of tax liability exists under the provisions of Sections 801 et seq. of Title 68, it shall issue an order releasing estate tax liability as to the property described in the notice. Such order shall have the same legal effect as a release or waiver from the Tax Commission, and shall be a final order on the issue of estate tax liability of such estate as to the property described in the notice and order. If the court finds there is a possibility that tax liability exists, it shall refer such matter to the Tax Commission and the determination of tax liability or absence thereof shall proceed as in other cases. For deaths occurring on or after January 1, 2010, no release of estate tax liability is necessary pursuant to Section 5 of this act. 2 The briefs filed on behalf of the estate and the trial judge's order only reference unpaid taxes for the years 1978 through 1984. Because the Tax Commission records reveal 1985 taxes are included in the delinquent taxes, we will reference taxes due as those from 1978 through 1985. 3 The Clean Slate '08 program, codified at 68 O.S.Supp. 2008 § 216.3, was an effort to encourage voluntary payment of taxes owed to the state. It provided a limited period of time for those with outstanding tax liabilities to pay those amounts or file past due tax returns free of penalty, interest, and collection fees. Interestingly, the Clean Slate notice for Patricia A. Bell referenced only the taxes due for the years 1992, 1997, and 1998. This appears to be a tacit admission that the earlier liabilities were barred by the applicable limitation period. As further evidence the Tax Commission recognized 68 O.S. 2001 § 223(A)'s application to Decedent's tax debt, a warrant filed on January 16, 2008, included only the assessed amounts for 1996 and 1997. 4 COCA correctly held the January 8, 2009 order, qualified as an appealable interlocutory order under 58 O.S. 2001 § 721(7) and (10). 5 The Tax Commission urges 68 O.S. 2001 § 223(A) does not limit its (1) ability to intercept an individual's tax refund to satisfy outstanding income tax liability, 68 O.S. Supp. 2006 § 205.2, OKLA. ADMIN. CODE §710:50-11-5, et seq.; (2) statutory authority to demand tax compliance as a condition of employment with the state, 68 O.S. Supp. 2005 § 238.2, OKLA. ADMIN. CODE § 710:95-11-1, et seq.; (3) right and requirement to demand tax compliance as a condition of obtaining or renewing a professional license, 68 O.S. 2001 § 238.1, OKLA. ADMIN. CODE § 710:95-9-1, et seq.; (4) right to accept payment of tax liability in a foreclosure, quiet title, or bankruptcy proceeding; or (5) right to enjoin business operations for failure to file or remit sales and withholding taxes pursuant to 68 O.S. 2001 § 232. 6 The Tax Commission has not alleged that it is immune from application of 68 O.S. 2001 § 223(A). Prior decisions of this Court have declined to impose a time limit on claims of "a government entity seeking in its sovereign capacity to vindicate public rights." see Oklahoma City Mun. Imp. Authority v. HTB, Inc., 1988 OK 149, ¶ 5, 769 P.2d 131, 133. However, where the Legislature has expressly indicated its intention to impose a time limit against the state, application of this principle is unwarranted. see Reed, 1972 OK 14, ¶¶ 16-18, 493 P.2d 815, 818. 7 The Tax Commission's own regulations recognize the time limits for assessing tax liability under 68 O.S. 2001 § 223(A). OAC § 710:50-5-12. 8 This Court denied certiorari on January 10, 2005. 9 see Cole v. Silverado Foods, Inc., 2003 OK 81, ¶ 10, n.23, 78 P.3d 542, 547.

ab0c6b91-06dc-4d9a-b8da-d5784b92c6e2

Hogg v. Oklahoma Cty. Juvenile Bureau

oklahoma

Oklahoma Supreme Court

HOGG v. OKLAHOMA COUNTY JUVENILE BUREAU2012 OK 107Case Number: 110890Decided: 12/11/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. VINCENT JAMES HOGG, SR., Petitioner, v. OKLAHOMA COUNTY JUVENILE BUREAU, OKLAHOMA COUNTY (OWN RISK #14772) and the WORKERS' COMPENSATION COURT, Respondents. APPEAL FROM THE WORKERS' COMPENSATION COURT HONORABLE OWEN T. EVANS, JUDGE ¶0 Petitioner appeals an order of the Workers' Compensation Court denying his eligibility for workers' compensation benefits. The trial court based its decision on the last sentence of 85 O.S. 2011, § 312 (3). This appeal was retained by this Court by order dated August 20, 2012. Utilizing rules of statutory construction, we reverse the decision of the Workers' Compensation Court and remand for further proceedings consistent with this opinion. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS John C. McMurry, John C. McMurry, P.C., Oklahoma City, Oklahoma, Brandon Joe Burton and Thurman Royce Banks, Burton & Associates, P.C., Oklahoma City, Oklahoma, for Petitioner, James C. Ferguson and Bruce V. Winston, Walker, Ferguson & Ferguson, Oklahoma City, Oklahoma, for Respondents. COMBS, J. ¶1 Petitioner, Vincent James Hogg, Sr., (Petitioner) seeks review of a June 28, 2012, order of the Workers' Compensation Court pursuant to 85 O.S. 2011, § 340. The order denied Petitioner workers' compensation benefits based upon the trial court's interpretation of 85 O.S. 2011, § 312 (3). We disagree with the trial court's findings and reverse and remand for further proceedings consistent with this opinion. FACTS ¶2 Petitioner was employed by the Oklahoma County Juvenile Detention Center when, on November 4, 2011, he sustained an injury to his right shoulder and neck while subduing an unruly and combative juvenile. The trial court found Petitioner sustained an injury and timely reported the injury to his employer on November 8, 2011. Petitioner was given a post-accident drug screen on November 8, 2011, and a follow-up screen the next day, November 9, 2011. Both screens showed a "positive" result for the presence of marijuana in his system.1 The trial court also found the Petitioner did not dispute the test results but Petitioner denied ever smoking marijuana. Petitioner's testimony revealed only that before November 4th he had been in the presence of others who were smoking marijuana. ¶3 The trial court found there was no evidence presented to establish Petitioner was "high" on November 4, 2011, nor was there any evidence to establish the marijuana in his system was the "major cause" of the accidental injury.2 The trial court did, however, deny Petitioner's eligibility for workers' compensation benefits by reason of its interpretation of the newly created 85 O.S. 2011, § 312 (3). ¶4 The trial court noted when the Workers' Compensation Code was created in 2011 it "essentially reiterated" the repealed provisions of 85 O.S. Supp. 2010, § 11 (A) (3) of the Workers' Compensation Act.3 Subsection A of repealed § 11 provides as follows: A. Every employer subject to the provisions of the Workers' Compensation Act shall pay, or provide as required by the Workers' Compensation Act, compensation according to the schedules of the Workers' Compensation Act for the disability or death of an employee resulting from an accidental personal injury sustained by the employee arising out of and in the course of employment, without regard to fault as a cause of such injury, and in the event of disability only, except as follows: 1. An injury occasioned by the willful intention of the injured employee to bring about injury to himself or herself, or another; 2. An injury resulting directly from the willful failure of the injured employee to use a guard or protection against accident furnished for use pursuant to any statute or by order of the Commissioner of Labor; 3. An injury which occurs when an employee is using substances defined and consumed pursuant to Section 465.20 of Title 63 of the Oklahoma Statutes, or is using or abusing alcohol or illegal drugs, or is illegally using chemicals; provided, this paragraph shall only apply when the employee is unable to prove by a preponderance of the evidence that the substances, alcohol, illegal drugs, or illegally used chemicals were not the proximate cause of the injury or accident. For the purposes of this paragraph, post-accident alcohol or drug testing results shall be admissible as evidence; 4. Except for innocent victims, an injury caused by a prank, horseplay, or similar willful or intentional behavior; and 5. An injury which occurs outside the course of employment. Employment shall be deemed to commence when an employee arrives at the employee's place of employment to report for work and shall terminate when the employee leaves the employee's place of employment, excluding areas not under the control of the employer or areas where essential job functions are not performed; provided, however, when the employee is instructed by the employer to perform a work-related task away from the employee's place of employment, the employee shall be deemed to be in the course of employment when the employee is engaged in the performance of job duties directly related to the task as instructed by the employer, including travel time that is solely related and necessary to the employee's performance of the task. Travel by a policeman, fireman, or a member of a first aid or rescue squad, in responding to and returning from an emergency, shall be deemed to be in the course of employment. (Emphasis added) Section 312 of the Code now contains some of §11's language. Section 312 provides as follows: The following shall not constitute a compensable injury under the Workers' Compensation Code: 1. An injury occasioned by the willful intention of the injured employee to bring about injury to himself or herself, or another; 2. An injury resulting directly from the willful failure of the injured employee to use a guard or protection against accident furnished for use pursuant to any statute or by order of the Commissioner of Labor; 3. An injury which occurs when an employee's use of illegal drugs or chemicals or alcohol is the major cause of the injury or accident. The employee shall prove by a preponderance of the evidence that the use of drugs, chemicals or alcohol was not the major cause of the injury or accident. For the purposes of this paragraph, post-accident alcohol or drug testing results shall be admissible as evidence. A public or private employer may require an employee to undergo drug or alcohol testing if the employee has sustained an injury while at work. For purposes of workers' compensation, no employee who tests positive for the presence of substances defined and consumed pursuant to Section 465.20 of Title 634 of the Oklahoma Statutes, alcohol, illegal drugs, or illegally used chemicals, or refuses to take a drug or alcohol test required by the employer, shall be eligible for such compensation; 4. Except for innocent victims, an injury caused by a prank, horseplay, or similar willful or intentional behavior; 5. An injury occurring at a time when employment services were not being performed before the employee was hired or after the employment relationship was terminated; and 6. An injury which occurs outside the course of employment. Employment shall be deemed to commence when an employee arrives at the employee's place of employment to report for work and shall terminate when the employee leaves the employee's place of employment, excluding areas not under the control of the employer or areas where essential job functions are not performed; provided, however, when the employee is instructed by the employer to perform a work-related task away from the employee's place of employment, the employee shall be deemed to be in the course of employment when the employee is engaged in the performance of job duties directly related to the task as instructed by the employer, including travel time that is solely related and necessary to the employee's performance of the task. Travel by a policeman, fireman, or a member of a first aid or rescue squad, in responding to and returning from an emergency, shall be deemed to be in the course of employment. (Emphasis added) Both sections concern exceptions to eligibility for workers' compensation benefits. The trial court opined that under repealed § 11 (A) (3) "claimant's proof would carry the day," however, because the injury occurred after that section was repealed, it found Petitioner is ineligible for workers' compensation benefits pursuant to the last sentence in 85 O.S. 2011, § 312 (3). This sentence was not contained in the repealed language of § 11. The trial court found the last sentence of § 312 (3) to be a legislative mandate that claimants be ineligible for workers' compensation benefits when illicit drugs are found to be in their system, ostensibly regardless of whether or not the drugs were a major cause of the accidental injury. The trial court's order thus views the provisions of Section 312 (3)'s final sentence in isolation and therefore created an irrebuttable presumption.5 The trial court concluded the legislature had established a "no tolerance rule" and therefore Petitioner was ineligible for workers' compensation benefits. STANDARD OF REVIEW ¶5 Title 85 O.S. 2011, § 340 (D) provides this Court with original jurisdiction to review orders of the Workers' Compensation Court and grants authority to modify, reverse, remand for rehearing, or set aside the order upon grounds that the order was contrary to law, among other things. Our review of the Workers' Compensation Court's legal rulings is plenary, independent and non-deferential. Multiple Injury Trust Fund v. Pullum, 2001 OK 115, ¶8, 37 P.3d 899, 903-904. Petitioner presents a question of law and such questions are reviewed by a de novo standard. Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶14, 859 P.2d 1081, 1084. A legal question involving statutory interpretation is reviewed de novo. Samman v. Multiple Injury Trust Fund, 2001 OK 71, ¶8, 33 P.3d 302, 305. ANALYSIS ¶6 The dispositive issue presented is whether the trial court erred in its interpretation of 85 O.S. 2011, § 312 (3). Petitioner challenges the trial court's interpretation of this paragraph. The trial court found the last sentence of paragraph 3 expressed the legislative intent of the entire paragraph without giving any weight to the other sentences of paragraph 3. In its order, the trial court indicated this sentence created an irrebuttable presumption. We disagree. ¶7 Ascertaining the meaning of statutory language is a pure issue of law. A cardinal rule of statutory construction is to ascertain and give effect to the legislative intent. City of Oklahoma City v. International Assoc. of Fire Fighters, Local 157, 2011 OK 29, ¶17, 254 P.3d 678, 683, citing Naylor v. Petuskey, 1992 OK 88, ¶4, 834 P.2d 439, 440. When a strict literal construction leads to an inconsistent or incongruent result between provisions, we will utilize rules of statutory construction to reconcile the discord and ascertain the legislative intent. St. John Medical Center v. Bilby, 2007 OK 37, ¶6, 160 P.3d 978, 979. In determining legislative intent this Court will look at the context of any ambiguous provisions and not limit our consideration to any one word or phrase. Id. We will give a sensible construction when interpreting statutes and not presume that the legislature intended an absurd result. AMF Tubescope Company v. Hatchel, 1976 OK 14, ¶ 21, 547 P.2d 374, 379. This Court will further reconcile different provisions of legislative acts to give intelligent effect to each and render them harmonious and consistent where possible. Eason Oil Company v. Corporation Commission, 1975 OK 14, ¶9, 535 P.2d 283, 286. ¶8 Title 85 O.S. 2011, § 312's opening sentence states "[t]he following shall not constitute a compensable injury under the Workers' Compensation Code." It then follows with 6 paragraphs detailing circumstances where an injury would not be compensable. Paragraphs 1, 2, and 4, concern injuries occurring due to willful and intentional acts of the injured worker.6 Paragraphs 5 and 6 relate to injuries occurring prior to employment or after termination of employment as well as those occurring outside the course of employment. Paragraph 3 is the subject of this appeal and its relevant provisions are as follows: 1st sentence: "An injury which occurs when an employee's use of illegal drugs or chemicals or alcohol is the major cause of the injury or accident." 2nd sentence: "The employee shall prove by a preponderance of the evidence that the use of drugs, chemicals or alcohol was not the major cause of the injury or accident. 3rd sentence: "For the purposes of this paragraph, post-accident alcohol or drug testing results shall be admissible as evidence." Last sentence: "For purposes of workers' compensation, no employee who tests positive for the presence of substances defined and consumed pursuant to Section 465.20 of Title 63 of the Oklahoma Statutes, alcohol, illegal drugs, or illegally used chemicals, or refuses to take a drug or alcohol test required by the employer, shall be eligible for such compensation." (Emphasis applied) ¶9 The trial court views the last sentence of 85 O.S. 2011, § 312 (3) as controlling the entire paragraph. In essence, treating this last sentence as if it were a later amendment to repealed 85 O.S. Supp. 2010, § 11. This Court has previously held that the most recent legislative expression must be given effect over prior enactments of contrary import. Brown v. Marker, 1965 OK 172, ¶19, 410 P.2d 61, 66. ¶10 Title 85 O.S. 2011, § 312 was created in Senate Bill 878 (2011) and became effective August 26, 2011.7 The "lead line" of Section 12 of Senate Bill 878 (2011) provides "SECTION 12. NEW LAW A new section of law to be codified in the Oklahoma Statutes as Section 312 of Title 85, unless there is created a duplication in numbering…" This new section of law with all its provisions became effective on August 26, 2011. Section 87 of Senate Bill 878, the repealer section, also repealed 85 O.S. Supp. 2010, § 11 among many other sections of the Workers' Compensation Act. ¶11 The language in 85 O.S. 2011, § 312 (3) differs from that in repealed 85 O.S. Supp. 2010, § 11 (A) (3). The term "major cause" was not used anywhere in § 11 (A) (3). Section 11 (A) (3) allowed the employee to prove by a preponderance of the evidence that the substances, alcohol, illegal drugs, or illegally used chemicals were not the proximate cause of the injury or accident. ¶12 Petitioner argues the last sentence of 85 O.S. 2011, § 312 (3) should be taken in context with the entire paragraph; otherwise, it would make the first three sentences meaningless. Petitioner would treat the first sentence as a topic sentence describing a non-compensable event, namely, an injury occurs and the use of illegal drugs, chemicals or alcohol is the major cause of the injury. Petitioner asserts the last sentence comes into play when there is evidence that the substance for which the injured worker tested positive is a major cause of the accident and the drug screening test is evidence of that conclusion. ¶13 The Court must view this new section of law, 85 O.S. 2011, § 312, in its entirety as the expression of legislative intent. The last sentence of paragraph 3 of that section should not be viewed in isolation. To do so would render the first 3 sentences of the paragraph superfluous and lead to absurd results. The last sentence standing alone has no relevant time frame for the taking of the drug or alcohol test, if not viewed in conjunction with the issue of major cause of the accident in question. A worker who tests positive would lose their eligibility for benefits even though a test might be taken months following the alleged injury or accident if there is no relation to the issue of the positive test/use as a major cause of the accident in question. There is also no restriction on when eligibility would resume. Without some relationship to the major cause of the accident in question, would a worker who tested positive once always be ineligible for workers' compensation benefits? We will not presume the legislature intended such absurd results. ¶14 The first two sentences of paragraph 3 of 85 O.S. 2011, § 312, clearly link the use of illegal drugs, or chemicals or alcohol as a major cause to the injury or accident. In order to give meaning to the last sentence in conjunction with the rest of the paragraph we find the last sentence creates a rebuttable presumption. Once a claimant tests positive or refuses to test for such a substance after an injury or accident, a rebuttable presumption is created. In order to be eligible for workers' compensation benefits, a claimant must then be allowed to present evidence to overcome this rebuttable presumption by establishing that the substance use was not the "major cause" of the injury or accident. If the worker fails to meet this burden by a preponderance of the evidence he or she would not be eligible for workers' compensation benefits related to that injury or accident. In Newquist v. Hall Building Products, Inc., 2004 OK CIV APP 92, ¶8, 100 P.3d 1060, 1063, the Oklahoma Court of Civil Appeals, Division I, dealt with a similar fact scenario. It determined the first sentence of 85 O.S. 2001, § 11 (A) (3) "injury…occurs when an employee…is using or abusing alcohol or illegal drugs, or is illegally using chemicals…" establishes the employer's burden of proof on the affirmative defense against liability. It held that the "[e]mployer satisfied its burden of proof on this defense if it proved by a preponderance of the evidence that Claimant's injury occurred 'when' he was using or abusing marijuana." In Davis v. Southwestern Bell Telephone, 2006 OK 48, ¶15, 139 P.3d 892, 896, we held that "[p]resumptions shift the burden of proof. The existence of a presumption imposes on the party against whom it is invoked the duty to offer evidence to the contrary." If the claimant offers evidence sufficient to overcome the rebuttable presumption the case would then stand upon the facts and reasonable inferences to be drawn therefrom.8 If possible, we will construe statutes so the whole may stand. Olim v. W. E. Mayberry, 1974 OK 81, ¶16, 524 P.2d 24, 26. This interpretation of legislative intent takes into account the whole paragraph and harmonizes its provisions to avoid an absurd result. ¶15 Petitioner also asks this Court to find the last sentence of 85 O.S. 2011, § 312 (3) unconstitutional and void as violating first, the separation-of-powers doctrine, secondly, the prohibitions against bills of attainder and finally the due process clause of the United States Constitution and the Oklahoma Constitution. Petitioner requests the last sentence be stricken and the remainder of § 312 (3) remain valid in accordance with title 75 O.S. 2011, § 11a (1).9 Inasmuch as we have resolved the dispositive issue by harmonizing the language of § 312 (3) we need not address these constitutional challenges at this time. ¶16 As noted earlier, the trial court found there was no evidence presented to show the Petitioner was "high" on November 4, 2011, nor was anything presented "that would cause the court to conclude that the marijuana in his system constituted the 'major' cause of the accidental injury."10 Therefore, the Petitioner has overcome the rebuttable presumption of ineligibility for workers' compensation benefits, and this matter is remanded to the trial court for further proceedings consistent with this opinion. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS ¶17 COLBERT, V.C.J., KAUGER, WATT, EDMONDSON, REIF, COMBS and GURICH, JJ., - concur. ¶18 TAYLOR, C.J., and WINCHESTER, J., - dissent. FOOTNOTES 1 Each test was sent to ACL Laboratory and the results only indicated a positive test result for marijuana. There were no THC levels indicated on the results. 2 Paragraph 5 of the June 28, 2012, Order Denying Eligibility for Workers' Compensation Benefits Pursuant to 85 O.S. § 312 (3), states: "THAT there was no evidence presented to prove that claimant was 'high' on November 4, 2011 when the 'incident' admittedly occurred. Nothing was presented which would cause the court to conclude that the marijuana in his system constituted the 'major cause' of the accidental injury." 3 Senate Bill No. 878 (2011), 2011 Okla. Sess. Laws ch. 318, created the Workers' Compensation Code to replace the Workers' Compensation Act. SB 878 did not contain an effective date clause or an emergency clause and therefore became effective August 26, 2011; 90 days from the adjournment of the legislative session in which it was passed pursuant to art. 5, § 58 of the Oklahoma Constitution. Pursuant to SCR 20 (2011) the First Session of the Fifty-third Legislature adjourned sine die at 5:00 p.m., Friday, May 27, 2011. 4 Title 63 O.S. 2011, § 465.20 provides: (a) It shall be unlawful for any person deliberately to smell, inhale, breathe, drink or otherwise consume any compound, liquid, chemical, controlled dangerous substance, prescription drugs or any other substance or chemical containing any ketones, aldehydes, organic acetones, ether, chlorinated hydrocarbons or metallic powders, such as gasoline, glue, fingernail polish, adhesive cement, mucilage, dope, paint dispensed from pressurized containers or any other substance or combination thereof containing solvents releasing toxic vapors, with the intent to cause conditions of intoxication, inebriation, excitement, elation, stupefaction, paralysis, irrationality, dulling of the brain or nervous system, or any other changing, distorting or disturbing of the eyesight, thinking processes, judgment, balance or coordination of such person. (b) The provisions of this statute shall not pertain to any person who inhales, breathes, drinks or otherwise consumes such material or substance pursuant to the direction or prescription of any licensed doctor, physician, surgeon, dentist or podiatrist; nor to the consumption of intoxicating liquor. (c) Any person who violates any provisions of this act relating to inhalation of glue or other substances shall be guilty of a misdemeanor, and upon conviction shall be subject to imprisonment in the county jail for not more than one (1) year or a fine of not more than Five Hundred Dollars ($500.00), or both such imprisonment and fine. 5 Paragraph 8 of the June 28, 2012, Order Denying Eligibility for Workers' Compensation Benefits Pursuant to 85 O.S. § 312 (3), states: "THAT even though claimant denied that he smoked marijuana, that testimony is insufficient to overcome the legislative mandate that claimants be ineligible for workers' compensation benefits when illicit drugs are found to be in their system. This appears to be a 'no tolerance rule.' As stated in State ex rel. Wright v. Oklahoma Corporation Commission, 2007 OK 73, 170 P.3d 1024, ¶60, '[a]n irrebuttable, conclusive, or absolute presumption is a rule of law that once the averment is shown it may not be overcome by any proof that the fact is otherwise.'" 6 These are paraphrased as follows: 1) willful intention to bring about the injury, 2) a willful failure to use a furnished guard or protection pursuant to statute or the Commissioner of Labor, and 4) horseplay or similar or intentional behavior. 7 2011 Okla. Sess. Laws ch. 318. 8 Davis v. Southwestern Bell Telephone, 2006 OK 48, ¶15, 139 P.3d 892, 896. 9 Title 75 O.S. 2011, § 11a (1) provides as follows: In the construction of the statutes of this state, the following rules shall be observed: 1. For any act enacted on or after July 1, 1989, unless there is a provision in the act that the act or any portion thereof or the application of the act shall not be severable, the provisions of every act or application of the act shall be severable. If any provision or application of the act is found to be unconstitutional and void, the remaining provisions or applications of the act shall remain valid, unless the court finds: a. the valid provisions or application of the act are so essentially and inseparably connected with, and so dependent upon, the void provisions that the court cannot presume the Legislature would have enacted the remaining valid provisions without the void one; or b. the remaining valid provisions or applications of the act, standing alone, are incomplete and are incapable of being executed in accordance with the legislative intent. 10 See paragraph 5 of the June 28, 2012, Order Denying Eligibility for Workers' Compensation Benefits Pursuant to 85 O.S. § 312 (3), fn. 2 supra.

a1adea39-6af4-42bc-ac9c-d073682b1c7e

Million v. Million

oklahoma

Oklahoma Supreme Court

MILLION v. MILLION2012 OK 106Case Number: 107854Decided: 12/04/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. KENNETH M. MILLION, Special Administrator of the Estate of SAMANTHA MILLION, Plaintiff/Appellant, v. JAY SCOTT MILLION, Defendant/Appellee. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIV. II ¶0 In May 2006, Samantha Million brought suit against her male cousin, Jay Scott Million, the appellee, alleging multiple acts of sexual abuse against her when she was a minor, during the years1980 through 1983. The trial judge, acting as factfinder, concluded that the applicable statute of limitations had run and therefore the appellant's claim was untimely filed. On appeal, the Court of Civil Appeals reversed and remanded. We granted certiorari. CERTIORARI PREVIOUSLY GRANTED; OPINION OF COURT OF CIVIL APPEALS VACATED; TRIAL COURT AFFIRMED. Edward, F. Saheb, Norman, Oklahoma, for appellant. David Proctor, GOOLSBY, PROCTOR, HEEFNER & GIBBS, P.C., Oklahoma City, Oklahoma, for appellee. WINCHESTER, J. ¶1 Samantha Million (hereinafter Plaintiff) brought a claim on May 26, 2006, against her male cousin, Jay Scott Million (hereinafter Defendant) for multiple acts of sexual abuse against her when she was a minor. Defendant advised this Court in his Petition for Writ of Certiorari that during the time this matter was pending on appeal, Plaintiff passed away. The District Court of Cleveland County appointed Kenneth M. Million, Plaintiff's father, as Representative of Plaintiff. On August 13, 2012, this Court granted the motion of the personal representative for substitution as the appellant in this appeal. ¶2 We find that the dispositive issue before us in this appeal is whether or not the statute of limitations had run on Plaintiff's claims. We hold that it did. ¶3 Plaintiff, who was born April 6, 1970, alleged that these acts were perpetrated during the years of 1980 through 1983, when Defendant was between the ages of 17 and 20, and Plaintiff was between 10 and 13 years old. In October 2005, Plaintiff was diagnosed with post-traumatic stress disorders caused by sexual abuse. She further claimed that she did not discover the cause of her trauma until 2006. Her petition was filed within two years after she purportedly began to remember the incidents of sexual abuse. ¶4 Defendant pled and presented evidence that the statute of limitations had run long before Plaintiff filed her action against him. After a non-jury trial before the District Court of Cleveland County, the trial judge, as fact-finder, found that the facts supported the conclusion that Plaintiff was capable of filing a case at an earlier date than she filed it. The court concluded that Plaintiff did not make a reasonably diligent effort to act on the alleged abuse, and that the statute of limitations had run. ¶5 Pleading the statute of limitations is an affirmative defense,1 and the burden is on a defendant to prove that a plaintiff's action is barred by the applicable statute. Harper-Turner Oil Co. v. Bridge, 1957 OK 124, ¶ 5, 311 P.2d 947, 949. The date where the period of limitations starts, when the plaintiff knew, or in the exercise of reasonable diligence should have discovered the act giving rise to the claim, is usually determined from the facts and circumstances of the particular case, and where reasonable persons may reach conflicting opinions, the issue is a question for determination by the finder of fact. Woods v. Prestwick House, Inc., 2011 OK 9, ¶ 32, 247 P.3d 1183, 1191. ¶6 The trial judge heard the evidence, observed the demeanor of the witnesses and found for Defendant. The judge observed that Plaintiff's memories of the events were not repressed to the extent that she was unable to know, understand, or express and react, and that there were too many separate and specific independent recollections and discussions with others about the alleged acts. ¶7 Those conclusions have support in the evidence presented during the trial. Plaintiff's uncle, with whom she lived at the time of the trial, testified he had visited Plaintiff and her family while she lived in England. During that visit he mentioned Defendant to Plaintiff's family. Plaintiff's mother told him not to talk about Defendant because he had molested Plaintiff. The uncle testified that Plaintiff was present. Plaintiff testified she was in England when she was age "17, 18, 19." Plaintiff testified during cross examination that she realized at age 11, what Defendant had done to her, then she changed the age to 12. She testified that in 1984 she knew Defendant had molested her, which would have made her age 14. After her family moved to Okinawa in 1984 she told her parents that Defendant had molested her, and she admitted during her testimony that she had not repressed her memory at that time. She testified that while she was in England, around 1987 or 1988 she told her Aunt Renee that it was not okay to talk about Defendant. Then during re-cross examination, she admitted that when she was 24 years old she was ashamed that she had been molested and had considered "hitting someone" with her car. Her uncle also testified that in 1997, when Plaintiff was 27 years old, she told her uncle about a specific incident of sexual abuse by Defendant when she was in her preteen years. All of this testimony is adequate to support the trial judge's finding that Plaintiff's memory had not been suppressed, at least through age 27. ¶8 Hagen v. Independent School District No. I-004, 2007 OK 19, ¶¶7, 8, 157 P.3d 738, 740, recites the well-established standard of review on appeal for a non-jury trial where the trial judge acts as the trier of fact. Those findings are entitled to the same weight and consideration that would be given to a jury's verdict. The findings of fact by the trial court in an action at law have the same force and effect as the verdict of a jury and those findings will not be disturbed on appeal where there is any evidence reasonably tending to support the findings. In addition, the credibility of witnesses and the effect and weight to be given to their testimony are questions of fact, not questions of law for the appellate court. ¶9 Plaintiff alleged the last sexual abuse occurred in 1983, when she was 13. At that time the applicable statute of limitations was 1971 Okla.Sess.Laws, ch. 316, § 3, subsequently codified as 12 O.S.1981, § 95.2 That statute provided in part: "Civil actions other than for the recovery of real property can only be brought within the following periods, after the cause of action shall have accrued, and not afterwards: * * * "Third. Within two (2) years: An action for trespass upon real property; an action for taking, detaining, or injuring personal property, including actions for the specific recovery of personal property; an action for injury to the rights of another, not arising on contract, and not hereinafter enumerated; an action for relief on the ground of fraud -- the cause of action in such case shall not be deemed to have accrued until the discovery of the fraud. . . ." ¶10 Because Plaintiff was a minor at the time of the alleged abuse, § 96 of title 123 would have controlled the statute of limitations. The statute provides in pertinent part: "If a person entitled to bring an action other than for the recovery of real property, except for a penalty or forfeiture, be, at the time the cause of action accrued, under any legal disability, every such person shall be entitled to bring such action within one (1) year after such disability shall be removed." ¶11 Although the trial court in its order gave additional and alternative reasons for its ruling, we find the evidence sufficient to support the ruling that the statute of limitations ran in 1989, one year after Plaintiff reached her majority. CERTIORARI PREVIOUSLY GRANTED; OPINION OF COURT OF CIVIL APPEALS VACATED; TRIAL COURT AFFIRMED. ALL JUSTICES CONCUR FOOTNOTES 1 12 O.S.2011, § 2008(C)(18) 2 The statute was subsequently amended in 1994, 1996, 2002, 2004, 2005, 2008, and 2009. 3 The portion of 12 O.S.2011, § 96 quoted is identical to the law first enacted in 1910, that is, R.L.1910, § 4658. In 1987, the legislature added language not pertinent to the matter before this Court, 1987 Okla.Sess.Laws, ch. 78, § 1.

ed02491d-86fb-40c2-a6e3-939f7b75291d

Bank of Beaver City v. Barretts' Livestock, Inc.

oklahoma

Oklahoma Supreme Court

BANK OF BEAVER CITY v. BARRETTS' LIVESTOCK, INC.2012 OK 89Case Number: 109190Decided: 10/30/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. THE BANK OF BEAVER CITY, Plaintiff/Appellee,v.BARRETTS' LIVESTOCK, INC., Defendant/Appellant, And TRI-STATE FEEDERS, INC., Defendant/Third-Party Plaintiff,v.JON DANE MORRIS Third-Party Defendant. CERTIORARI TO THE COURT OF CIVIL APPEALS DIVISION IV Honorable Greg A. Zigler, Trial Judge ¶0 The trial court found the interest of plaintiff/appellee Bank of Beaver City (Bank) in the livestock of cattle operation and debtor Lucky Moon Land and Livestock, Inc. (Lucky Moon) to be superior to that of another creditor of Lucky Moon, defendant/appellant Barretts' Livestock, Inc. (Barretts). We granted certiorari to address a case of first impression. We hold, as did the Court of Civil Appeals, that the trial court should be affirmed because Bank's interest is superior to that of Barretts. CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION VACATED;TRIAL COURT AFFIRMED. Douglas L. Jackson, Julia C. Rieman, Enid, Oklahoma, for Defendant/Appellant.Michael C. Bigheart, W. Blake Hulse, Enid, Oklahoma, for Plaintiff/Appellee. KAUGER, J.: ¶1 The dispositive issue presented is whether the good faith requirement of 12A O.S. 2011 §2-403 extends to third parties--in this case an unpaid seller of cattle--and requires that the third party be notified of a debtor's financial condition.1 We hold that it does not. ¶2 Bank alleges that on August 9, 2004, it perfected a security interest in all of Lucky Moon's livestock, including all after-acquired livestock, giving it a superior claim to cattle purchased by Lucky Moon from Barretts to satisfy the debt owed by Lucky Moon to Bank of approximately $2,000,000 as of May 20, 2010. Barretts asserts that Bank does not have priority over it because Bank was not a good faith secured creditor. The trial court granted Bank's motion for summary judgment, finding that Bank's perfected security interest had preference over Barretts' unperfected security interest. ¶3 Barretts appealed, contending that Bank did not have a superior security interest because: 1) Bank's security interest never attached; and 2) Bank had not acted in good faith. The Court of Civil appeals affirmed the judgment of the trial court. Bank seeks certiorari, contending that: 1) the case presents an issue of first impression as to when good faith under 12A O.S. 2011 §2-403 should be determined; 2) Bank's security interest never attached; and 3) the Court of Civil Appeals' decision was inconsistent with a different decision of the Court of Civil Appeals on which the court relied. We granted certiorari on February 21, 2012, to address the novel issue of whether the good faith requirement of 12A O.S. 2011 §2-403 extends to third parties and requires that they be notified of a debtor's financial condition. FACTS ¶4 Barretts had been selling cattle to Lucky Moon for several years. Typically, it would deliver the cattle, submit an invoice, and then give Lucky Moon a few weeks to pay. Barretts did not file a financing statement or perfect any security interest in the cattle. Between August 28, 2009, and December 11, 2009, Barretts made sales and deliveries totaling 903 head of cattle to Lucky Moon. Lucky Moon made two separate payments towards the total amount, one by wire transfer from Bank on October 13, 2009, and one by check paid by Bank on October 29, 2010. The remaining balance after payment was $214,533.52, representing 393 head of cattle. At this point, Lucky Moon wrote four separate checks totaling $176,234 in partial payment of the remaining debt which were dishonored by Bank for insufficient funds. Both Bank and Barretts claimed an interest in the cattle. On or about January 13, 2010, the parties agreed to auction the cattle and deposit the payments into escrow pending a determination of which claim was superior. ¶5 Bank filed a petition seeking declaratory relief arguing that it possessed priority over the sale proceeds based in its perfected security interest. Barretts, which had no perfected security interest, asserted that the Bank's conduct deprived it of a superior security interest because it had not acted in good faith by continuing to cover Lucky Moon's overdrafts despite knowledge of its deteriorating financial condition; and that one of the co-owners lied about the cattle transactions. Barretts also argued that it would not have delivered the cattle had it known that Bank was not going to honor Lucky Moon's checks. THE GOOD FAITH OBLIGATION OF 12A O.S. 2011 §2-403 DOES NOT EXTEND TO THIRD PARTIES A.Bank of Beaver City's Security Interest ¶6 The Uniform Commercial Code, 12A O.S. 2011 §1-9-322(a)(2), provides that a perfected security interest or agricultural lien has priority over a conflicting unperfected security interest or agricultural lien.2 A perfected security interest in after-acquired property takes precedence over an unperfected security interest. We must determine whether the Bank perfected a security interest in 2004, which applied to all of the livestock including all after-acquired cattle. ¶7 Barretts does not dispute the creation of Bank's security interest in all of Lucky Moon's after acquired cattle, but it asserts that Bank's security interest was never perfected because Bank was not a good faith purchaser for value and therefore could not acquire rights to the collateral sufficient to permit attachment. Pursuant to 12A O.S. 2011 §1-9-308, a security interest is perfected if it has attached and all the applicable requirements for perfection in Sections 1-9-310 through 1-9-316 of Title 12A have been satisfied.3 Barrett's contends that Bank's security interest was never perfected pursuant to 12A O.S. 2011 §1-9-308 because it never attached. Pursuant to 12A §1-9-203, a security interest attaches to collateral when it becomes enforceable against the debtor with respect to that collateral.4 A security interest becomes enforceable against the debtor and third parties only if: 1) value has been given; 2) the debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and 3) certain formalities regarding the security agreement are satisfied.5 ¶8 Barretts argues that even if Lucky Moon had possession of the cattle it did not pay for them. Therefore, it could not transfer rights to the cattle pursuant to 12A O.S. 2011 §1-9-203(b)(2), making perfection of Bank's security interest in the cattle impossible. This situation is anticipated by the language of 12A O.S. 2011 §2-403(1), which provides that a person with voidable title has the power to transfer good title to a good faith purchaser for value even if the delivery was in exchange for a check which was later dishonored.6 Barretts delivered 393 cows to Lucky Moon and Lucky Moon paid for those cattle with checks which were later dishonored. Under these facts, Lucky Moon had voidable title, allowing the bank's security interest to attach if the bank were a good faith purchaser for value.7 ¶9 Pursuant to 12A O.S. 2011 §2-403(1), for a security interest to attach to after-acquired property, the purchaser must have acquired its interest as a good faith purchaser for value to have priority over an unpaid seller. The bank is a purchaser, because it possesses a security interest.8 Whether the Bank acted in good faith as a purchaser hinges on the definition of good faith and whether the good faith requirement extends to a third party such as Barretts. Good faith is defined in Title 12A O.S. § 1-201(20) as honesty in fact and the observance of reasonable commercial standards of fair dealing.9 B.Duty of Good Faith ¶10 Barretts asserts that the Bank became intimately involved in Lucky Moon's operations and spoke with Lucky Moon at least weekly about its deteriorating financial condition.10 The duty of good faith exists between the lender and debtor, and one court has found a lender not to be a good faith purchaser due to its conduct, regardless of whether that duty is extended to third parties. In Monsanto Co. v. Heller, 449 N.E.2d 993 (Ill. App. 1983), Heller had a deep relationship with its debtor, Ilikon, and exercised considerable control over its business practices.11 Heller continued to cover Ilikon's checks to Monsanto Co. despite detailed knowledge of Ilikon's insolvency.12 However, Barretts does not allege that Bank exercised the kind of detailed control over Lucky Moon's business for its own profit that the court in Monsanto Co. found to be in bad faith.13 ¶11 Here, the dispositive issue is whether Bank owed any duty to Barretts, a third party. The Court of Appeals held that it knew of no controlling authority to support the proposition that the Bank owed a duty of good-faith under 12A O.S. 2011 §2-403 to Barretts, a third party. We agree. Although this is a case of first impression in Oklahoma, our holding is consistent with the Court of Civil Appeals and the case law of other states interpreting the application of their versions of U.C.C. §2-403 to disputes between unpaid sellers and lenders with a perfected security interest in a debtor's inventory. ¶12 A decision of the Fifth Circuit Court of Appeals, Shell Oil Co. v. Mills Oil Co., Inc., 717 F.2d 208 (5th Cir. 1983), is on point. In a diversity action interpreting Mississippi's version of U.C.C. §2-403, the court held that: 1) knowledge of the existence of an unpaid seller does not impair a lender's good faith; and 2) no agreement, express or implied, obligated the lender to disclose its debtor's financial condition to an unpaid seller.14 ¶13 Other cases do not state the second proposition directly. They do, however, bolster the argument that knowledge of outstanding third-party claims which have not been paid does not prevent a lien creditor from being a good faith purchaser within the meaning of U.C.C. §2-403. For example, in Matter of Samuels & Co., Inc., 526 F.2d 1238, 1243-44 (5th Cir. 1976), the court held that lack of knowledge of outstanding claims was necessary to acquire status as a bona fide purchaser under the common law and was required in many U.C.C. provisions, but the Code's definition of an Article Two good faith purchaser did not expressly or impliedly include lack of knowledge of third-party claims as an element.15 ¶14 The court in Maryott v. Oconto Cattle Co., 607 N.W.2d 820, 828 (Neb. 2000), another case concerning rights to cattle, agreed with that analysis, holding that a lender's duty of good faith did not require that the lender be ignorant of third party claims. In Maryott, the lender did not notify any other parties of its actions before cancelling the cattle company's line of credit, and like this case, prevented payment for the cattle by dishonoring drafts.16 In Cooperative Finance Ass'n v. B & J Cattle Co., 937 P.2d 915 (Colo. App. 1997), the court determined that a secured party may prevail over an unpaid seller even when the secured party terminates advances on a line of credit without notice and then dishonors drafts drawn in reliance on that line of credit.17 ¶15 Good faith does not require a lender go out of its way to finance a troubled debtor purely for the benefit of affected third parties. The Code's good faith provision requires honesty in fact, but it does not require a secured party to continue financing a doomed business enterprise.18 These cases collectively imply that under similar circumstances and facts, the secured party lender will prevail despite knowledge of its debtor's negative financial condition and the competing claims of third parties. As long as the decision concerning the funding was commercially reasonable, the secured creditor with a floating lien remains a good faith purchaser even if it terminates funding with the knowledge that sums are owed to third parties.19 CONCLUSION ¶16 Summary judgment comes to this court as a de novo review when it involves only legal questions.20 Inferences and conclusions are to be drawn from the underlying facts contained in the record and are to be considered most favorably to the party opposing summary judgment.21 Granting a motion for summary judgment is only proper when one party is entitled to judgment as a matter of law because there are no material disputed factual questions.22 The underlying facts are not in dispute in this appeal. ¶17 Under the facts, pursuant to 12A O.S. 2011 §2-403, Bank is a secured party which qualifies as a good faith purchaser for value. It is entitled to priority over an unpaid credit seller.23 The good faith requirement does not extend to unpaid sellers such as Barretts. The Bank did not violate such a duty by deciding to terminate its funding of Lucky Moon, and to dishonor its checks without notifying Barretts of Lucky Moon's shaky financial situation. CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION VACATED;TRIAL COURT AFFIRMED. Taylor, C.J., Kauger, Winchester, Edmondson and Combs, JJ., concur; Colbert, V.C.J., Watt, Reif and Gurich, JJ., dissent. FOOTNOTES 1 Title 12A O.S. 2011 §2-403 is Oklahoma's codified provision of U.C.C. §2-403 (to which it is identical). It states: (1) A purchaser of goods acquires all title which his transferor had or had power to transfer except that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A person with voidable title has power to transfer a good title to a good faith purchaser for value. When goods have been delivered under a transaction of purchase the purchaser has such power even though (a) the transferor was deceived as to the identity of the purchaser, or (b) the delivery was in exchange for a check which is later dishonored, or (c) it was agreed that the transaction was to be a "cash sale", or (d) the delivery was procured through fraud punishable as larcenous under the criminal law. (2) Any entrusting of possession of goods to a merchant who deals in goods of that kind gives him power to transfer all rights of the entruster to a buyer in ordinary course of business. (3) "Entrusting" includes any delivery and any acquiescence in retention of possession regardless of any condition expressed between the parties to the delivery or acquiescence and regardless of whether the procurement of the entrusting or the possessor's disposition of the goods have been such as to be larcenous under the criminal law. (4) The rights of other purchasers of goods and of lien creditors are governed by the articles on Secured Transactions (Article 9) and Documents of Title (Article 7). 2 Title 12A O.S. 2011 §1-9-322(a) provides: (a) Except as otherwise provided in this section, priority among conflicting security interests and agricultural liens in the same collateral is determined according to the following rules: (1) Conflicting perfected security interests and agricultural liens rank according to priority in time of filing or perfection. Priority dates from the earlier of the time a filing covering the collateral is first made or the security interest or agricultural lien is first perfected, if there is no period thereafter when there is neither filing nor perfection; (2) A perfected security interest or agricultural lien has priority over a conflicting unperfected security interest or agricultural lien; and (3) The first security interest or agricultural lien to attach or become effective has priority if conflicting security interests and agricultural liens are unperfected. 3 Title 12A O.S. 2011 §1-9-308(a) provides: (a) Except as otherwise provided in this section and Section 1-9-309 of this title, a security interest is perfected if it has attached and all of the applicable requirements for perfection in Sections 1-9-310 through 1-9-316 of this title have been satisfied. A security interest is perfected when it attaches if the applicable requirements are satisfied before the security interest attaches. 4 Title 12A O.S. 2011 §1-9-203(a) provides: (a) A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment. 5 Title 12A O.S. 2011 §1-2-203(b) provides: (b) Except as otherwise provided in subsections (c) through (i) of this section, a security interest is enforceable against the debtor and third parties with respect to the collateral only if: (1) value has been given; (2) the debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and (3) one of the following conditions is met: (A) the debtor has authenticated a security agreement that provides a description of the collateral and, if the security interest covers timber to be cut, a description of the land concerned; (B) the collateral is not a certificated security and is in the possession of the secured party under Section 1-9-313 of this title pursuant to the debtor's security agreement; (C) the collateral is a certificated security in registered form and the security certificate has been delivered to the secured party under Section 8-301 of this title pursuant to the debtor's security agreement; or (D) the collateral is deposit accounts, electronic chattel paper, investment property, letter-of-credit rights, or electronic documents, and the secured party has control under Section 7-106, 1-9-104, 1-9-105, 1-9-106, or 1-9-107 of this title pursuant to the debtor's security agreement. 6 Title 12A O.S. 2011 §2-403(1) provides: (1) A purchaser of goods acquires all title which his transferor had or had power to transfer except that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A person with voidable title has power to transfer a good title to a good faith purchaser for value. When goods have been delivered under a transaction to purchase the purchaser has such power even though (a) the transferor was deceived as to the identity of the purchaser, or (b) the delivery was in exchange for a check which is later dishonored, or (c) it was agreed that the transaction was to be a "cash sale", or (d) the delivery was procured through fraud punishable as larcenous under the criminal law. 7 Title 12A O.S. 2011 §2-403; Wolfe v. Faulkner, 1981 OK 48, ¶21, 628 P.2d 700. See In Re Matter of Samuels & Co., 526 F.3d 1238, 1242-44 (5th Cir. 1976); Maryott v. Ocanto Cattle Co., 607 N.W.2d 820, 827 (Neb. 2000) (Nebraska has adopted UCC Section 2-403 as well). 8 Title 12A O.S. 2011 §1-201(29) and (30) define "purchaser" and "purchase" as (29) 'Purchase' means taking by sale, discount, negotiation, mortgage, pledge, lien, security interest, issue or reissue, gift, or any other voluntary transaction creating an interest in property. (30) 'Purchaser' means a person who takes by purchase. (Emphasis added.) 9 Good faith is an overriding purpose of the code. See Grant Gilmore, The Good Faith Purchase Idea and the Uniform Commercial Code: Confessions of a Repentant Draftsman, 15 Georgia L. Rev. 605, 629 (1981). 10 Appellant's Petition for Writ of Certiorari, 2. 11 Monsanto Co. v. Heller, 449 N.E.2d 993, 994-95 (Ill. App. 1983). 12 Monsanto Co., note 11 at 998-99, supra. The court held: While we agree that a secured lender is not expected to extend unlimited credit for an indefinite period in the absence of an express agreement, "good faith" under the Code has been held expressly to require that parties engage in "reasonable commercial standards of fair dealing." …. Given the course of dealing between the parties, [Lender's] direct involvement with the operation of Ilikon and with Ilikon's transactions with its suppliers, we believe … the trial court correctly concluded that Heller was not entitled to the priority of a "good faith purchaser for value" under section 2-403(1). 13 The relationship in Monsanto Co. involved daily telephone conversations about: Ilikon's sales of the prior day; the amount collected in Heller's lockbox and the prior day's balances in Ilikon's accounts at the Bank; the amount of checks previously written by Ilikon that had not yet cleared the Bank and the amount of cash required to cover checks previously written that were to clear the Bank that day, as well as general business information concerning Ilikon and Monsanto…. Heller monitored its loans to Ilikon by auditing Ilikon's books and records and examining its and facilities from time to time. Heller also required regular written financial reports from Ilikon including daily reports of bank balances, sales collections and accounts receivable, raw materials and monthly inventory reports. Monsanto Co., note 11 at 995, supra. 14 Shell Oil Co. v. Mills Oil Co., Inc., 717 F.2d 208, 213-14 (5th Cir. 1983). The Court held: Shell argues only that Citizens Bank's knowledge that Shell was unpaid creates a genuine issue as to the bank's good faith. We reject Shell's argument…. Shell Oil Co., 717 F.2d at 214. The Court, in discussing Mills' claim that the bank had a duty to protect him against the consequences flowing from his contingent liability as a guarantor of Shell Oil Company, also held that: [m]ills contends that the bank officers should have notified Mills that Mills Oil Company's overdrafts were being honored. Mills' contentions are meritless. No precedent is cited which establishes any such duties. No agreement, express or implied, obligated the bank to notify or advise Mills regarding the financial affairs of Mill Oil Company. [Emphasis supplied.] Shell Oil Co., 717 F.2d at 214. At this point the court was not interpreting claims related to good faith and U.C.C. §2-403, but since the court found no duty to notify Mills, period, it is implied that none existed under U.C.C. §2-403 either. 15 In Re Matter of Samuels & Co., Inc., note 7 at 1243-44, supra. 16 Maryott, note 7, supra. 17 Cooperative Finance Ass'n v. B & J Cattle Co., 937 P.2d 915, 921 (Colo. App. 1997), citing In Re Matter of Samuels, note 7, supra. The court held: [a] secured creditor with an after-acquired property clause is frequently a line-of-credit lending institution which can, and sometimes does, elect without notice to terminate advances on the line of credit and then dishonors drafts issued in reliance on the line of credit. In that instance, the secured creditor may well enhance its secured position at the expense of the unpaid cash-seller. Even under these circumstances, however, the secured party prevails. 18 In Re Matter of Samuels & Co., Inc., note 7 at 1243, supra. 19 In Re Matter of Samuels & Co., Inc., note 7 at 1244, supra. 20 Welch v. Crow, 2009 OK 20, ¶9, 206 P.3d 599, 602-603; EOG Res Mktg., Inc. v. Oklahoma State Bd. of Equalization, 2008 OK 95, ¶13, 196 P.3d 511, 518-19; Carmichael v. Beller, 1996 OK 48, ¶2, 914 P.2d 1052, 1053. 21 K & K Food Services, Inc. v. S & H, Inc. 2000 OK 31, ¶16, 3 P.3d 705, 711; Vance v. Federal Nat. Mortg. Ass'n, 1999 OK 73, ¶6, 988 P.2d 1275, 1276; Shelly v. Kiwash Elec. Co-op., Inc., 1996 OK 44, ¶15, 914 P.2d 669, 674. 22 Jennings v. Badgett, 2010 OK 7, ¶4, 230 P.3d 861, 864; Lowery v. Echostar Satellite Corp., 2007 OK 38, ¶11, 160 P.3d 959, 963-64; Vance v. Federal Nat. Mortg. Ass'n, 1999 OK 73, ¶6, 988 P.2d 1275, 1276. 23 It is worth noting that Colorado has amended its version of U.C.C. §2-403 to specifically exclude its application to cattle that have not been paid for. Colo. Rev. Stat §4-2-403 states in pertinent part: (1.5) Notwithstanding any other provision of this section, when livestock have been delivered under a transaction of purchase and on the accompanying brand inspection certificate or memorandum of brand inspection certificate the seller has conspicuously noted that payment of the consideration for the transaction has not been received, the buyer does not have power to transfer good title to a good faith purchaser for value until payment is made. COMBS, J., with whom TAYLOR, C.J., and KAUGER, J., join concurring: ¶1 I concur in the majority opinion but write to express my concern as to Barretts' ability to protect its interest prior to the attachment of the lien. Barretts argue without being paid for the cattle, even though possession has transferred to Lucky Moon, title could not have been transferred and therefore the lien could not attach. An additional issue presented would be how Barretts could as the seller protect its interest after physical transfer of the livestock but prior to payment for the sale of the cattle. I note with interest the majority's identification of the legislative amendment to the Uniform Commercial Code made by the Colorado legislature as reflected in footnote 23. ¶2 Specifically, Colorado has amended its version of UCC §2-403 seemingly to address the very issue presented in the facts of this case. The Colorado lawmakers provided: "Notwithstanding any other provision of this section, when livestock have been delivered under a transaction of purchase and on the accompanying brand inspection certificate or memorandum of brand inspection certificate the seller has conspicuously noted that payment of the consideration for the transaction has not been received, the buyer does not have power to transfer good title to a good faith purchaser for value until payment is made." Emphasis applied. See, Colo. Rev. Stat §4-2-403. ¶3 Under such a provision Barretts as seller of the cattle would have been able to protect its interest until such time as payment had been made by Lucky Moon. In commercial transactions such as these where the parties have rolling inventory and thus rolling collateral, in order to protect the free market enterprise the seller must be assured that title does not pass nor does the ability to attach a lien interest under 12A O.S. 2011 §2-403 accrue until payment has been made. To do otherwise exposes the seller to the risk of stop payment orders and insufficient remedies to be compensated for the transaction. WATT, J., with whom COLBERT, V.C.J. and REIF, J. join, dissenting: ¶1 The majority correctly parrots the Uniform Commercial Code's statements on security interests and their priorities. Thereafter, with two sentences at the end of the opinion, reaches a result that invades the province of the fact finder about what duty is owed to the livestock company. The issue, as framed, is whether the Bank owed any duty to a third party. The opinion goes on to hold that, under these "contested facts," it does not. Admittedly, this is the general rule under the Uniform Commercial Code. Because I would return this cause to the trier of fact for resolution, I dissent. ¶2 The majority sets forth the Code's definition of "good faith" dealing as "honesty in fact and the observance of reasonable commercial standards of fair dealing."1 It does not provide the added input found in the Uniform Commercial Comments to the same section where the definition of good faith is found. It provides in pertinent part: [T]he definition of 'good faith' in this section requires not only honesty in fact but also 'observance of reasonable commercial standards of fair dealing.' Although 'fair dealing' is a broad term that must be defined in context, it is clear that it is concerned with the fairness of conduct rather than the care with which an act is performed. . . . [Emphasis provided.] Oklahoma Comments to the 2001 version of the same section providing that "good faith" was honesty in fact in the conduct or transaction concerned"2 are even more instructive. They provide in pertinent part: . . . (19) 25 Okl.St.Ann § 9 provides: "Good faith consists in an honest intention to abstain from taking unconscientious advantage of another, even through the forms or technicalities of law, together with an absence of all information or belief of facts which would render the transaction unconscientious." The term was also used, but not defined, in the Negotiable Instruments Law [48 Okl.St.Ann. §§ 122(3), 126 now repealed.] The Commercial Code definition is briefer, but the spirit of the two definitions are the same. [Emphasis provided.] ¶3 Most certainly, under either of the two definitions of "good faith," supra, there are material issues of fact which remain unresolved. Here, even the uncontested facts leave a reasonable person to ponder whether: the secured creditor (the Bank), is in bed with the debtor (2nd party), through knowledge of their poor financial condition and that they are selling cattle out of trust. With this knowledge, they honor numerous overdraft checks written to the livestock company (3rd party). Once the Bank realizes that the debtor really is "going belly up" and still has in its possession some 300 plus cattle does it dishonor checks to the livestock company in an attempt to increase its own collateral and financial position. ¶4 If the Bank did act in the way described, they owe a duty to the 3rd party. Under these facts, most certainly, reasonable people could conclude that the Bank "hid behind the log" to improve its position and abandoned its duty of good faith in the commercial setting. We cannot assume, as does the majority, that the facts are as either party presents them. The livestock company should have the opportunity to prove that the Bank abandoned its position of priority by acting in bad faith. ¶5 I cannot concur in an opinion which makes assumptions resulting in the reward of devious behavior by the Bank while ignoring the rights of the innocent 3rd party. Admittedly, the livestock company was sloppy in not filing a financing statement. Nevertheless, I would prefer to reward the careless rather than the devious. Therefore, I dissent. FOOTNOTES 1 Title 12A O.S. 2011 §1-201(19). 2 Title 12A O.S. 2001 §1-201(19). GURICH, J., with whom COLBERT, V.C.J. and REIF, J. join dissenting: ¶1 The majority holds that the good faith requirement of 12A O.S. 2011 § 2-403 does not extend to third parties. Such a holding is not supported by the Uniform Commercial Code,1 and case law interpreting the Code,2 and goes too far--it bars all future third parties from defeating a secured lender's interest under § 2-403 regardless of how egregiously the lender has acted. ¶2 To be a good faith purchaser for value, a party must act honestly in fact and observe reasonable commercial standards of fair dealing.3 Barretts' Livestock submitted evidence that created an issue of material fact as to whether the bank acted in good faith.4 As such, summary judgment should not have been granted. FOOTNOTES 1 Section 2-403 states that "[a] person with voidable title has power to transfer a good title to a good faith purchaser for value." 12A O.S. 2011 § 2-403(1). Third parties are not precluded under § 2-403 from asserting that the purchaser lost its priority because it did not act in good faith. "Good faith is an overriding purpose of the Code." Monsanto v. Walter E. Heller Company, Inc., 449 N.E.2d 993, 1000 (Ill. App. 1983). 2 Manheim Auto. Fin. Servs., Inc. v. Guthrie, No. 06-2298-KHV, 2007 WL 3054184, at *9 (D. Kan. Oct. 19, 2007) (finding that Manheim presented no evidence regarding reasonable commercial standards of fair dealing or whether it followed those standards and had not established as a matter of law that it acted in good faith so as to qualify as a good faith purchaser for value under § 2-403); Chrysler Credit Corp. v. Ferguson Pontiac-GMC, Inc., 1993 OK CIV APP 43, ¶¶ 11-12, 853 P.2d 1282, 1284 (holding that for Chrysler's security interest to defeat Ferguson's reclamation right, Chrysler had to be a good faith purchaser for value but that evidence of Chrysler's good faith was either conflicting or absent and so summary judgment was inappropriate); Iola State Bank v. Bolan, 679 P.2d 720, 731-32 (Kan. 1984) (holding that the bank failed to act in good faith and so it was not a good faith purchaser and its security interest did not attach against the sellers); Monsanto, 449 N.E.2d at 1000 (holding that the course of dealings between the parties and Heller's direct involvement with the operation of Ilikon's transactions with its suppliers precluded Heller from claiming priority as a good faith purchaser for value because Heller did not act in good faith); In re American Food Purveyors, Inc., 1974 WL 21665, 17 U.C.C. Rep. Ser. 436 (N.D. Ga. 1974) (finding that the secured party had to act in good faith and have no notice of the debtor's insolvency condition to prevail over the reclaiming rights of the seller). The cases relied on by the majority do not hold that the good faith requirement of § 2-403 does not extend to third parties. Rather, these cases find that either no evidence of bad faith was presented or the evidence presented did not rise to the level of bad faith. See Maryott v. Oconto Cattle Co., 607 N.W.2d 820, 828 (Neb. 2000) (finding that Maryott had not specifically alleged bad faith in either of its petitions and had not met its burden of proving bad faith on the part of Farm Credit); Cooperative Finance Ass'n, Inc. v. B & J Cattle Co., 937 P.2d 915, 921 (Colo. App. 1997) (finding that the lender's terminating advances on a line of credit and dishonoring drafts issued in reliance on the line of credit was not bad faith so as to defeat the lender's priority); Shell Oil Co. v. Mills Oil Co., Inc., 717 F.2d 208, 213 (5th Cir. 1983) (rejecting Shell's argument that the bank's knowledge that Shell was unpaid was enough to create a material issue as to the bank's good faith); Matter of Samuels & Co., Inc., 526 F.2d 1238, 1243 (5th Cir. 1976) (finding no evidence that the lender acted in bad faith). 3 12A O.S. 2011 § 1-201(20). 4 Defendant's Response to Plaintiff's Motion for Summary Judgment at 28-37.

b7e2082b-326f-4c1c-8400-0f0c9dffd92a

Colclasure v. Colclasure

oklahoma

Oklahoma Supreme Court

COLCLASURE v. COLCLASURE2012 OK 97Case Number: 109218Decided: 11/20/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. LORI COLCLASURE, Now DEAN, Petitioner/Appellant,v.KENT COLCLASURE, Respondent/Appellee. CERTIORARI TO THE OKLAHOMA COURT OF CIVIL APPEALS,DIVISION IV Honorable Barry L. Hafer, Trial Judge ¶0 The appellant wife and the appellee husband owned a business together. The business had been the sole property of the wife until shortly before the parties' marriage, when the husband bought a forty-nine percent interest in the business for five-thousand dollars. The wife filed for divorce five years later. During the pendency of the divorce, the wife terminated the husband from the marital business. Husband, still a co-owner of the marital business and receiving the benefits of this ownership, started a competing business. The trial court, in determining the value of the husband's share of the business did not consider any loss in value to the marital business because of the husband's competing business. The Court of Civil Appeals affirmed. We granted certiorari and hold that the trial court should have, in settling the value of the business for property settlement purposes, included any loss in business value because of the husband's competing business. CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION VACATED;TRIAL COURT REVERSED AND REMANDED. George H. Brown, Oklahoma City, Oklahoma, for Petitioner/Appellant.John E. Barbush, Oklahoma City, Oklahoma, for Respondent/Appellee. KAUGER, J.: ¶1 The only issue presented on appeal is whether the trial court erred in its valuation of the marital business. We reverse and remand to the trial court for a valuation of the parties' marital business which includes any loss in its value due to husband's competing business. Such a determination must include its value as of the date that the husband purchased a share of the business, as well as any offset to the valuation of husband's share of the business because he received money from the business during the pendency of the divorce. FACTS ¶2 The appellant, Lori Colclasure Dean (wife), was, from January 1, 1999, until January 1, 2004, the sole owner and operator of Arrow Hardwood Floors, LLC, (Arrow)1 Arrow was an Oklahoma Limited Liability Company under the Articles of Organization filed with the Oklahoma Secretary of State on April 2, 1998. On January 1, 2004, Dean and appellee Kent Colclasure (husband), executed a document entitled Unit Purchase Agreement for Dean's sale of forty-nine percent (49%) of Arrow Hardwood Floors to her then fiancée, Colclasure. The purchase price under the agreement was five-thousand dollars ($5,000).2 No valuation of the company was made at the time of the Unit Purchase Agreement. However, Colclasure's expert indicated that the Gross Receipts for the calendar year 2003, were $635,549 and that the Gross Profits totaled $126,431.3 ¶3 The parties were married on October 1, 2004. On December 19, 2006, they executed a document entitled Operating Agreement for Arrow Hardwood Floors, LLC. The agreement was presented to them by an accountant and business consultant who worked for Arrow and was a friend of the husband.4 The template for the document was prepared by a lawyer and finalized by the accountant.5 The wife was described in the Agreement as the manager of Arrow and she signed the document as such. The husband and wife both signed as members. The Certificate of Agreed Value contained in the agreement was blank, as was the addendum setting forth their initial capital contributions and the percentages of ownership. The agreement contained two pertinent clauses which should be noted in their entirety, clause 6.08,6 concerning outside activities of members and clause 12.01,7 disqualification of a member. ¶4 The wife and husband each worked at Arrow. The husband worked as the sales representative and the wife worked as the manager/bookkeeper. The petition for divorce was filed by the wife on December 28, 2009, and included an application for a temporary order. An agreed temporary order was filed on February 9, 2010. The agreement provided that the wife was to continue as the accountant, although the Agreement does not describe her as such, and that the husband was to work for the company as the sales representative. The parties were prohibited from incurring any corporate indebtedness without written permission from the other party or order of the court. The order provided for monthly distributions to be made to both parties. ¶5 By April of 2010, the relationship between the parties had deteriorated further. On or about April 1, 2010, at the Arrow premises, during a dispute over husband's charges of entertainment and other purchases to the company accounts, the husband shoved the wife, causing her to fall. As a result of the fall, the wife was treated for contusions and bruising to her tailbone and she filed for a victim's protective order. She terminated the husband from his role as the company's sales representative on April 5, 2010. ¶6 The husband started his own flooring company in direct competition with Arrow and, pursuant to the agreed temporary order, used the Arrow showroom as his office. The wife alleged that the husband used Arrow order books, samples, mobile telephones, and transport in this competing business. She also alleged that he stole Arrow's customers and undercut Arrow on bids. On June 30, 2010, the trial court issued a minute order setting forth the parties' agreed use of the Arrow showroom. The order provided that the husband was not to use the warehouse; the telephone; say he was with Arrow or access Arrow's current bids; neither husband nor wife was to interfere with each other's business or customers. The husband was still receiving disbursements from Arrow. ¶7 The case was tried during the last week of September of 2010; the Decree of Dissolution of Marriage was filed on January 28, 2011. The husband was awarded $235,200.00 in property division alimony for his forty-nine (49) percent interest in Arrow. This amount is forty-seven times the amount of his initial investment in Arrow, just five years before the divorce was filed. ¶8 The valuation of the business was not conducted pursuant to the terms of the Agreement. Both sides presented expert valuation testimony during the divorce trial. The valuations were significantly different. The procedures in the Agreement providing for a third tie-breaking evaluation were not used.8 ¶9 The wife's expert, Kenneth W. Klingenberg (Klingenberg), was a certified public accountant and a member of the Oklahoma Bar. His valuation was made using an income method and an excess earnings approach, with a December 31, 2009, valuation date. He testified that he used the end of the business year valuation date because the records were better and because the divorce was filed on December 28, 2009. His valuation reduced the total value of Arrow because of diversion of $298,085.58 in business by the husband. Klingenberg calculated, using Dean's figures, that the loss in the value of Arrow because of diverted business was $104,330.9 His buy/sell valuation of Arrow was $216,315. He included the diverted business in the valuation because, although it occurred after the valuation date, a subsequent event, it was both known and knowable and thus should have been used in the valuation. ¶10 The husband's expert, Ralph E. Blodgett (Blodgett), was a certified public accountant, a member of the Oklahoma Bar and a Certified Valuation Analyst. He used the capitalized cash flow method of valuation with a valuation date of November 30, 2009, which he stated was required by the agreement. He considered the filing of the divorce to be the Event of Dissolution. He calculated Arrow's value at $480,000, and the husband's interest at $235,200.10 He testified that the diversion of business by husband in 2010, was not known or knowable as of the date of valuation and thus could not be used to value the business.11 This method precludes any reduction in the value of the business because of the husband's competing business. There was no evaluation of the enhanced benefits the husband received. The trial court valued the business at $480,000. The husband was awarded property division alimony of $235,200. ¶11 The Court of Civil Appeals affirmed the value which the trial court placed on Arrow and the resulting amount of property division awarded husband for his portion of Arrow. We granted certiorari on May 14, 2012, to consider the disputed valuation of Arrow in the property division. ¶12 THE TRIAL COURT ERRED IN FAILING TO CONSIDER AREDUCTION IN VALUATION OF THE MARITAL BUSINESS BECAUSEOF HUSBAND'S BUSINESS COMPETITION. ¶13 The wife argues that the husband's direct competition with Arrow caused a decrease in the value of the business which should have been reflected in the trial court's determination of Arrow's valuation and thus the amount of the husband's property division alimony. She argues that there was "double-dipping" by the husband because he had income from business diverted from Arrow and income from Arrow, with no adjustment whatsoever for the decline in Arrow's value because of this. ¶14 The husband argues that, under the Agreement, the date of valuation was unalterably November 30, 2009. He also argues that, because his competition against Arrow took place after November 30, 2009, it cannot be used to alter the value of Arrow on the valuation date. He contends that, because the Agreement permitted his competition, he cannot be penalized for his actions by a reduction of his property award. ¶15 At the outset we note that the agreement was a buyout agreement and failing a buyout, an agreement for the dissolution of a business, which neither party followed. They did not obtain appraisers by the time they were required to do so under the contract. They did not follow the contract requirement that, if the appraisers did not agree, they would hire a third appraiser and follow an averaging valuation. Had the parties followed their own agreement, this matter could have been settled by the parties without the need to involve the trial court in the valuation process. ¶16 A divorce suit is one of equitable cognizance in which the trial court has discretionary power to divide the marital estate.12 The trial court must follow the provisions of 43 O.S. Supp. 1992 §121 which require a fair and equitable division of property acquired during the marriage by the joint industry of the husband and wife.13 The trial court has wide latitude in determining what part of jointly-acquired property shall be awarded to each party.14 However, a marital estate need not necessarily be equally divided to be an equitable division because the words just and reasonable in §121 are not synonymous with equal.15 An appellate court will not disturb the trial court's property division absent a finding of abuse of discretion or a finding that the decision is clearly contrary to the weight of the evidence.16 ¶17 Jointly-acquired property is that which is accumulated by the joint industry of the spouses during the marriage.17 A marital estate need not be equally divided in order for there to be equitable division, as the wife converted what was, prior to the marriage, her separate property, into a marital business by permitting the husband to "buy" an interest in the business for $5,000.00. Consequently, Arrow is now considered marital property subject to division in the divorce. However, a mere valuation of Arrow as of a date certain, November 30, 2009, or December 28, 2009, does not determine what portion of the value of the business was the result of the husband's efforts, the wife's efforts, or their joint efforts. ¶18 The trial court was not bound by the valuation date set forth in the Agreement when placing a value on the business for purposes of property division. Pursuant to Thielenhaus v. Thielenhaus, 1995 OK 5, 890 P.2d 925, the trial court is vested with discretion in determining the cut-off time for the valuation of marital assets, and the date of valuation is to be determined by the trial court after due consideration of all the circumstances of the case.18 The trial court is obligated by statute to ensure a fair and just division of the marital assets, and the only mechanism permitted by statute to override that obligation is an antenuptial agreement between the parties. The Agreement at issue in this case was not entered into until after the parties married.19 The trial court wrongly held that the parties' Agreement, which they did not follow, required it to reach an unfair result in distributing the company's value between them. ¶19 The Agreement and the Unit Purchase Agreement provide no valuation of Arrow. The wife permitted the husband to buy into her existing business for what appears to be a nominal purchase price. Klingenberg's valuation stated that the total income for Arrow in 2003 was $126,431; the gross receipts were $635,549. The husband paid $5,000 for his forty-nine percent of Arrow and received forty-seven times that amount in property division alimony. To be equitable, any determination of a value for the marital business must take into account the value of the business when Colclasure bought his forty-nine percent share, and the proportionate increase in value due to the joint industry of the husband and wife. ¶20 We note that in Lemons v. Lemons, 2006 OK CIV APP 5, 128 P.3d 1113, the court held that as a general rule the trial court should not consider how much either party contributed to the purchase of jointly acquired property, because a gift from one party to the other is presumed. The Lemons court relied on this Court's decision in Shackelton v. Sherrard, 1963 OK 193, 385 P.2d 898. In Shackelton, we held that the interests of married joint tenants are presumed to be equal, because one of the characteristics of joint tenancy is the equality of the interest.20 Here, the marital property, like that in Lemons, is not held by joint tenancy and is not subject to the presumption of equality of interest. To the extent that Lemons contradicts this Court's holding in Shackelton, it is overruled. ¶21 This Court has also recognized the concept of double-dipping as it relates to accounting for disbursements from marital property during the pendency of a divorce.21 In Mocnik v. Mocnik, 1992 OK 99, 838 P.2d 500, the wife removed $7,000 from joint funds at the time of the marital separation. To avoid double-dipping, the $7,000 was included as a portion of the wife's property settlement. This action was not altered on the appeal. In this cause, the trial court failed to address payments to the husband from Arrow while the divorce was pending or income to the husband and wife. These are examples of double-dipping and should have been addressed in the alimony in lieu of property settlement award to the husband. ¶22 The trial court's property division in this case is clearly contrary to the weight of the evidence. The husband was a named co-owner of Arrow while intentionally competing against Arrow. He was operating a competing business in the Arrow showroom. He used Arrow equipment in the competing business. It was not ordinary competition, but competition from an individual familiar with the inner workings of the business and its client base. The trial court should have considered the exact loss to the value of Arrow because of the husband's competition and adjusted the husband's share of the property division accordingly. ¶23 The husband's argument that the agreement permitted him to operate a competing business is not relevant to the valuation issue. The question is not whether he may be sued for breach of fiduciary duty, but rather whether his actions lowered Arrow's value so that he received more money in the property settlement than he should have received. The husband's competition was permitted under the contract. It is not an issue of permission, but of benefit to one party at the expense of another party. ¶24 The husband also argues that the valuation date of November 30, 2009, cannot be altered and that any offset in Arrow's value because of his competition is not a factor because it took place in 2010, after the valuation date. The Agreement set out procedures for what may be called a minority owner buy-out if that member becomes disqualified as a member because of divorce. The Agreement provided: For purposes of this Section, 12.01, "Appraised Value" shall mean the appraised value determined as of the last day of the month immediately prior to the month in which the Event of Dissolution occurred (the "Appraisal Date") in accordance with this section 12.01(c). The purchase price shall be determined as of the Appraisal Date by an independent appraiser mutually agreed to by the Disqualified Member and the remaining Members. In the event the Disqualified Member and the remaining Members are unable to agree upon the independent appraiser within twenty (20) days after the Appraisal Date, the Disqualified Member shall select an independent appraiser and the remaining Members shall select an independent appraiser within thirty (30) days after the Appraisal Date. The Purchase Price shall be determined by averaging the amount determined by the two (2) independent appraisers. In the event either of the appraised values is greater or lesser than ten percent (10%) of the average appraised value, then the two (2) independent appraisers shall select a third appraiser, and the Purchase Price shall be the average of the two (2) appraisals which are closest in amount. In the event the Disqualified Member or the remaining Members fail to select an appraiser within the thirty (30) day period, the appraiser selected within such time period shall alone determine the purchase price. Each appraiser shall submit its appraisal in writing...within thirty (30) days from the date the appraiser is engaged.... ¶25 The valuation and buy-out provisions of the Agreement were not followed. This is not the rewriting of an unambiguous contract. The parties wanted to cherry pick the contract for the terms most favorable to each of them. The entire contract was followed by neither party. There is no provision in the Agreement which provides that the members will try and continue the business together if a divorce is filed. The Agreement provides for a reasonable and timely buy-out of the disqualified member. In this case, the court's equity power in determining the property division is sufficient to permit it to consider a property valuation which does not require a November 30, 2009, valuation date. CONCLUSION ¶26 The property settlement in a divorce case is an equitable matter and will not be overturned unless it is clearly against the weight of the evidence.22 The evidence shows that the trial court made no determination of the actual increase in the value of the business from the date husband became a part of the business. There was no determination of how much double-dipping took place when the husband received money from the business which was not deducted from the property settlement. There was no determination concerning how much husband's direct, insider competition against Arrow devalued it. ¶27 There is a basic evidentiary question as to the exact amount of business the husband diverted. The record does not give a balanced picture of how this was calculated, but rather relies on the wife's expert, who in turn relies on the wife's calculations. There was no determination of the value of the business at the time husband bought his share. These questions must all be covered by the trial court the second time around. The evidence, taken as a whole, shows that the valuation of Arrow, and thus the husband's portion of the property settlement, was against the clear weight of the evidence. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT REVERSED AND REMANDED. TAYLOR, C.J., COLBERT, V.C.J., KAUGER, EDMONDSON, REIF, and GURICH, JJ., concur. WATT, J., WINCHESTER, J., and COMBS, dissent. FOOTNOTES 1 Testimony of Lori Colclasure, District Court of Oklahoma County, September 28, 2010. 2 Petitioner's exhibit 32, District Court of Oklahoma County, September 28, 2010. Petitioner's counsel stated in a letter to Respondent's counsel, dated April 5, 2010, and filed in the FD 2009-6534, District Court of Oklahoma County, that Colclasure did not pay the requisite payment for his share of Arrow. 3 Respondent's exhibit 79, District Court of Oklahoma County, September 27, 2010. 4 Testimony of Lori Colclasure, District Court of Oklahoma County, September 28, 2010. 5 Testimony of Rob Shaff, District Court of Oklahoma County, September 28, 2010. 6 Operating Agreement of Arrow Hardwood Floors, clause 6.08 provides, in pertinent part: Outside Activities. Each Member... may have business interest and engage in business activities in addition to those relating to the Company, including, without limitation, business interest and activities that are in direct competition with the Company ...and no provision of this Agreement shall be deemed to prohibit such Member... from having such competing business interests or conducting such competitive businesses or activities. Neither the Company nor the other Members shall have the right by virtue of this Agreement or the relationship contemplated herein in any business ventures of such Member or such Member's Affiliates. 7 Operating Agreement of Arrow Hardwood Floors, clause 12.01 provides, in pertinent part: Disqualification of Member. Upon the death, filing of a petition for divorce, incapacity, resignation, bankruptcy or disassociation of a Member (such Member being hereafter sometimes referred to as a 'Disqualified Member'), ... the Company shall dissolve and its affairs shall be wound up. The Company shall thereafter conduct only activities necessary to wind up its affairs, unless within sixty (60) days after the occurrence of an Event of Dissolution, the remaining Members owning a majority of the Percentage Interests... agree to continue the company. If an election to continue the Company is made[,] ...[t] he remaining members may elect, within sixty (60) days of electing to continue the Company, to purchase the Disqualified Members Percentage Interests. The purchase price to be paid by the remaining Members for the Disqualified Member's Percentage Interest (the "Purchase Price") shall be the Agreed Value ... multiplied by the Disqualified Member's Percentage Interest. If no agreed value had been determined in accordance with this Section 12.01, then the Purchase Price shall be the Appraised Value... multiplied by the Disqualified Member's Percentage Interest.... (C) For purposes of this Section, 12.01, "Appraised Value" shall mean the appraised value determined as of the last day of the month immediately prior to the month in which the Event of Dissolution occurred (the "Appraisal Date") in accordance with this section 12.01(c). The purchase price shall be determined as of the Appraisal Date by an independent appraiser mutually agreed to by the Disqualified Member and the remaining Members. In the event the Disqualified Member and the remaining Members are unable to agree upon the independent appraiser within twenty (20) days after the Appraisal Date, the Disqualified Member shall select an independent appraiser and the remaining Members shall select an independent appraiser within thirty (30) days after the Appraisal Date. The Purchase Price shall be determined by averaging the amount determined by the two (2) independent appraisers. In the event either of the appraised values is greater or lesser than ten percent (10%) of the average appraised value, then the two (2) independent appraisers shall select a third appraiser, and the Purchase Price shall be the average of the two (2) appraisals which are closest in amount. In the event the Disqualified Member or the remaining Members fail to select an appraiser within the thirty (30) day period, the appraiser selected within such time period shall alone determine the purchase price. Each appraiser shall submit its appraisal in writing...within thirty (30) days from the date the appraiser is engaged.... 8 See footnote 6 for the terms of the Operating Agreement for valuation of the company if a member is bought out. 9 Testimony of Kenneth Klingenberg, District Court of Oklahoma County, September 27, 2010. 10 Testimony of Ralph E. Blodgett, District Court of Oklahoma County, September 27, 2010. 11 Testimony of Ralph E. Blodgett, District Court of Oklahoma County, September 27, 2010. 12 Jackson v. Jackson, 1999 OK 99, ¶7, 995 P.2d 1109; Larman v. Larman, 1999 OK 83, ¶17, 991 P.2d. 536; Teel v. Teel, 1988 OK 151, ¶7, 766 P.2d 994, 998; Johnson v. Johnson, 1983 OK 117, 674 P.2d 539, 544; Carpenter v. Carpenter, 1983 OK 2, ¶24, 657 P.2d 646, 651; Peters v. Peters, 1975 OK 114, ¶9, 539 P.2d 26, 27; McCoy v. McCoy, 1967 OK 86, ¶ 8, 429 P.2d 999; West v. West, 1954 OK 84, ¶6, 268 P.2d 250, 253. 13 Title 43 O.S. Supp. 2006 §121, in effect as of the date of the divorce, provides in pertinent part: ...The court shall enter its decree confirming in each spouse the property owned by him or her before marriage and the undisposed-of property acquired after marriage by him or her in his or her own right. Either spouse may be allowed such alimony out of real and personal property of the other as the court shall think reasonable, having due regard to the value of such property at the time of the divorce. Alimony may be allowed from real or personal property, or both, or in the form of money judgment, payable either in gross or in installments, as the court may deem just and equitable. As to such property, whether real or personal, which has been acquired by the parties jointly during their marriage, whether the title thereto be in either or both of said parties, the court shall, subject to a valid antenuptial contract in writing, make such division between the parties as may appear just and reasonable, by a division of the property in kind, or by setting the same apart to one of the parties, and requiring the other thereof to be paid such sum as may be just and proper to effect a fair and just division thereof.... 14 Teel v. Teel, see note 12, supra. See also Phillips v. Phillips, 1976 OK 165, ¶9, 556 P.2d 607, 610. 15 Gray v. Gray, 1996 OK 84, ¶15, 922 P.2d 615. 16 Teel v. Teel, see note 12, supra; Kiddie v. Kiddie, 1977 OK 69, ¶3, 563 P.2d 139, 140-41. 17 Thielenhaus v. Thielenhaus, 1995 OK 5, ¶9, 890 P.2d 925, 930. 18 Thielenhaus v. Thielenhaus, note 17, supra at ¶11. 19 Title 43 O.S. Supp. 2006, in effect at the date of the divorce, provides in pertinent part: … As to such property, whether real or personal, which has been acquired by the parties jointly during their marriage, whether the title thereto be in either or both of said parties, the court shall, subject to a valid antenuptial contract in writing, make such division between the parties as may appear just and reasonable, by a division of the property in kind, or by setting the same apart to one of the parties, and requiring the other thereof to be paid such sum as may be just and proper to effect a fair and just division thereof.... [emphasis added]. 20 Shackelton v. Sherrard, 1963 OK 193, ¶9-10, 385 P.2d 898. We held that: Under such rule it is ordinarily immaterial how much money the wife or husband has actually contributed to the purchase of the property involved because a gift from one to the other is presumed. Absent any fraud or special agreement, where the wife or husband knowingly agrees and consents to the conveyance being made to themselves as joint tenants, either is estopped to deny the tenancy of the other. [emphasis added]. 21 Mocnik v. Mocnik, 1992 OK 99, 838 P.2d 500. See also Gray v. Gray, 1996 OK 84, 922 P.2d 615, which provides: The trial court has wide latitude in determining what part of jointly-acquired property shall be awarded to each party. Teel v. Teel, 766 P.2d 994, 998 (Okla.1988); Phillips v. Phillips, 556 P.2d 607, 610 (Okla.1976). However, all property acquired during marriage by the joint industry of the husband and wife must be fairly and equitably divided by the trial court. 43 O.S. Supp.1992 § 121; Thielenhaus, 890 P.2d at 930. This is true regardless of how title to the property is held. 43 O.S. Supp.1992 § 121; Manhart, 725 P.2d at 1240. The marital estate need not necessarily be equally divided to be an equitable division because the words "just" and "reasonable" in § 121 are not synonymous with "equal." Teel, 766 P.2d at 997 n. 6. An appellate court will not disturb the trial court's property division absent a finding of abuse of discretion or a finding that the decision is clearly contrary to the weight of the evidence. Id. at 998; Kiddie v. Kiddie, 563 P.2d 139, 140-41 (Okla.1977). 22 Teel v. Teel, see note 12, supra ; Phillips v. Phillips, see note 14, supra; Thielenhaus v. Thielenhaus, see note 17, supra; Kiddie v. Kiddie, see note 16, supra. Watt, J., with whom Winchester, J. and Combs, J. join, dissenting: ¶1 The petitioner/appellant, Lori Colclasure (wife), sold a forty-nine percent interest in her flooring business to the respondent/appellee, Kent Colclasure (husband), before the marriage. The majority remands the instant cause for the trial court to re-evaluate the worth of the business, including any loss in its value due to the husband having opened a competing business and to the draws he took from the business after divorce proceedings were instituted. It also directs the trial court to value the business as of the date of the husband's purchase along with any money he received as an owner of the business. In so doing, the majority invades the province of the trial court while re-writing the parties' contract for what appears to be the single purpose of increasing the wife's settlement award. This I will not do. Therefore, I dissent. ¶2 a) No abuse of discretion occurred in theproperty division. ¶3 The majority pays lip service to the well-established rule that the trial court has considerable discretion in making decisions regarding the division of property upon divorce. The opinion provides in pertinent part at ¶15: . . . The trial court has wide latitude in determining what part of jointly acquired property shall be awarded to each party. . . . An appellate court will not disturb the trial court's property division absent a finding of abuse of discretion or a finding that the decision is clearly contrary to the weight of the evidence. . . . [Footnotes omitted.] Nevertheless, it goes on to find abuse where none exists. In order to do so, the majority abandons the rule it claims for guidance and the standard for upholding a decision made by the one person in the judicial chain with the opportunity to hear the evidence, observe the parties and the witnesses, and form an independent conclusion guided by application of legal standards to the facts presented. ¶4 An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law,1 when there is no rational basis in evidence for the ruling,2 or if it acts arbitrarily.3 None of these conditions exist in this cause. ¶5 There are valid reasons upon which the trial court may have determined the husband's valuation of the business interest to have been more accurate than that of the wife's. First, the wife's expert recognized that there was an error of approximately $144,000.00 in his calculations.4 Second, the appraiser acknowledged that there was a method in the parties' agreement for the determination of a date to utilize in determining the valuation of the business, which he did not utilize.5 Third, the report itself had conflicting dates upon which different capitalization rates6 were utilized, which may have indicated that the wife's appraiser was "cherry picking" information from reports of different dates and utilizing the information most favorable to his client. This is demonstrated by the expert's own testimony where he admits completing an initial report in which he utilized a capitalization rate of 36.96% and then applied a rate of 47.05% in the report submitted at trial.7 It is also apparent in the selection of a number for the corporation's gross profits.8 Third, the same witness admitted to using the highest tax rate available to a corporation in his valuation estimates rather than the tax rate applicable to the flooring business.9 Fourth, the wife's expert agreed that his original valuation of the company was some $300,000.00 lower than the final draft and that if he had not included estimated values for diversion of income and had not utilized the inflated capitalization rate, his estimate would have been comparable to the estimate made by the husband's appraiser.10 Finally, the wife's expert admitted that his valuation was not computed in accordance with generally accepted accounting principals although it was done pursuant to National Association of Certified Valuation Analyst Professional Standards.11 ¶6 The majority recognizes that the trial court had before it evidence that would support the trial court's property division. It acknowledges that the valuation was made by an individual who is a member of the Oklahoma Bar Association and a Certified Valuation Analyst. It is of no import that there was also evidence from another source which would support a different division of the property interests. There being no evidence sufficient to show the trial court abused its discretion as to the property division, its ruling should be affirmed. ¶7 b) To reach the result recommended by the majority,it must rewrite an unambiguous contract. An action prohibitedby Oklahoma jurisprudence. ¶8 The Operating Agreement (agreement) was signed by both the husband and the wife as "members." It provides in pertinent part that each member may engage in business, without limitation, in business interests and activities that are in direct competition with the Company. The agreement goes on to state, in mandatory language,12 that no provision of the contract shall be deemed to prohibit a member from having a competing business or engaging in competitive activities.13 ¶9 Upon divorce, the agreement provides that the company shall dissolve and its affairs be wound up with the right to purchase being given to any remaining member. The same contract has a formula for determining a purchase price which utilizes an appraised value where no agreed value can be reached. Again, mandatory language provides that the "appraised value" shall mean the value determined as of the last day of the month immediately prior to the month in which the event of dissolution occurs, here the appraisal date is undoubtedly the last day of the month prior to the month in which the petition for divorce was filed. In this case, the "event of dissolution" was the wife's filing for divorce on December 28, 2009. Clearly, the agreement, which both parties signed, intended the date of valuation to be November 30, 2009, not some date thereafter which might take into effect changes in condition of the operation of the flooring business.14 ¶10 Intent at execution controls the meaning of written contractual terms15 and the extent of the obligation is defined by the promise given. Contract language is accorded its plain and ordinary meaning absent a term intended to carry a specific technical meaning.16 Where terms are defined the parties are bound by those definitions.17 Extrinsic evidence need not be introduced when the language is clear and explicit.18 If the contract is complete in itself and, viewed in its entirety unambiguous, its language is the only legitimate evidence of intent.19 The courts decide, as a matter of law, whether a contract provision is ambiguous.20 Absent illegality, the parties are free to bargain as they see fit, and this Court will neither make a new contract nor rewrite existing terms.21 ¶11 There is nothing ambiguous about the agreement entered by the parties. It clearly and unambiguously allows direct competition and provides the formula by which the value of the company is to be determined. The wife made a bad business decision when she sold her then fiancé forty-nine percent (49%) of her flooring company for $5,000.00. The husband did not "double dip" by continuing to receive his share of the benefits arising from the interest he held in the wife's flooring business and nothing prohibited his entering into competition with the original flooring enterprise. Rather, such competition was expressly considered in the agreement itself. ¶12 There was no abuse of discretion in acknowledging the terms of the contract or in holding the parties to those strictures. The abuse occurs when the majority steps in to make a property division that "looks fair" but which is not what the parties clearly intended nor is it that for which they negotiated. CONCLUSION ¶13 A review of the property division for an abuse of discretion does not allow this Court to substitute its judgment for that of the trial court. Because no such abuse occurred, the property division award should be upheld. I would do so. Therefore, I dissent. FOOTNOTES 1 Wells Fargo Bank, N.A. v. Heath, 2002 OK 54, ¶8, 280 P.3d 328. 2 United States Bank Nat'l Ass'n v. Baber, 2012 OK 55, ¶4, 280 P.3d 956; Fent v. Oklahoma Natural Gas Co., 2001 OK 35, ¶12, 27 P.3d 477. 3 Head v. McCracken, 2004 OK 84, ¶2, 102 P.3d 670; Mooney v. Mooney, 2003 OK 51, ¶50, 70 P.3d 872. 4 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at p. 64: ". . . Q All right. Looking at this page, do you see where you have the - the number $357,386, correct? A Absolutely, yes, sir. Q Okay. I'm going to hand you [sic] calculator. Will you, please, do the math where you have deducted out those other expenses and tell me if your report give [sic] us the correct number? A Well, I'm embarrassed to tell you, it does not come up with the number. THE COURT: Okay, I'll bite. What number does it come out to? MR. KLINGENBERG: 207,588. . . ." 5 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at pp. 65-66: ". . . Q Okay. But you saw in the operating agreement, in Section 12, where the parties agreed on how the company would be valued, as far as how the appraisal date would be determined for using for an evaluation, if there was a need to evaluate the company; is that correct? A As of the appraisal date, yes. . . . Q So the parties had agreed previously, before we got any experts involved, on what date the company's financials and documents would be looked at to do an evaluation; is that correct? A Under the operating agreement there is a method, yes. . . ." 6 "Capitalization rate" is that percentage which will provide for recapture or amortization of value of investment in the improvements, plus a reasonable and proper rate of return to the investor, whether income to be capitalized is calculated before or after deduction of debt service. Sill Corp. v. United States, 343 F.2d 411 (10th Cir. 1965), cert. denied, 86 S. Ct. 86, 382 U.S. 840, 15 L. Ed. 2d 81 (1965). 7 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at: pp. 66-67: "Q Looking at this page that we've ben referring to or your report, it's got - why does it say, 31-Dec-08 at the top of those numbers? A Well, because I had originally prepared an evaluation prior, and when we changed it that should have changed to December 31, '09. . . ." p. 74: ". . . Q It is quite common when you prepare evaluations of companies to see capitalization rates computed at 47.05 percent, in your experience? A . . . But this is a relatively high cap rate, I'm not denying that it is. . . ." p. 78: ". . . Q And tell the Judge what your pre-tax, current year capitalization rate was when you prepared your first valuation of the company? A 36.96 percent. . . ." 8 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at p. 78: ". . . Q And you used the valuation date of December 31st, 2008, in this report, correct? A That is correct. Q Now, Arrow Hardwood Floors [sic] gross profit for 2009 was actually a bit higher than 2008, wasn't it? A I think you're right. . . ." 9 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at p. 74: ". . . Q Okay. Now, speaking of the taxes, isn't it true, sir, that you used the highest tax rate of 35 percent, which is the same rate used for C corporations? A That's correct. Q And that is an S corporation, correct? A That's correct. . . ." 10 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at pp pp. 84-85: ". . . Q Okay. What on the 2009 tax return changed your valuation of this company by, approximately, $300,000, sir? . . . A I don't know that it was specifically anything on the '09 tax return that changed the value. . . . Q Okay. Would you agree with me, sir, that if we take out this stuff about a deduction for diversion of income and used this cap rate that you originally determined for the valuation of the company, you and Mr. Blodget's final valuation numbers are very close? A You know I haven't run those numbers but I would - certainly, that would narrow the gap. . . ." 11 Transcript of proceedings, September 27, 2010, Kenneth W. Klingenberg testifying in pertinent part at p. 86: ". . . Q Can you tell this Court this your final valuation is computed in accordance with generally accepted accounting principals? A It never was intended to be, and it was not, and it will not be. . . ." 12 The term "may" is ordinarily construed as permissive while "shall" is commonly considered to be mandatory. MLC Mort. Corp. v. Sun America Mort. Co., 2009 OK 37, fn. 17, 212 P.3d 1199; Osprey LLC v. Kelly-Moore Paint Co., Inc., 1999 OK 50, ¶14, 984 P.2d 194; Shea v. Shea, 1975 OK 90, ¶10, 537 P.2d 417. 13 Operating Agreement of Arrow Hardwood Floors, clause 6.08. 14 Operating Agreement of Arrow Hardwood Floors, clause 12.01. 15 Title 15 O.S. 2011 §152; Oxley v. General Atlantic Resources, Inc., 1997 OK 46, ¶14, 936 P.2d 43. 16 Title 15 O.S. 2011 §154; JPMorgan Chase Bank v. Speciality Restaurants, Inc., 2010 OK 65, 243 P.3d 8; BP America, Inc. v. State Auto Property & Cas. Ins. Co., 2005 OK 65, ¶6, 148 P.3d 832. 17 See, Maule v. Independent School Dist. No. 9 of Tulsa County, 1985 OK 110, ¶7, 714 P.2d 198 18 Lum v. Lee Way Motor Freight, Inc., 1987 OK 112, ¶16, 757 P.2d 810; Rucker v. Republic Supply Co., 1966 OK 118, ¶9, 415 P.2d 951. 19 Founders Bank & Trust v. Upsher, 1992 OK 35, ¶19, 830 P.2d 1355; Mercury Inv. Co. v. F.W. Woolworth Co., 1985 OK 38, ¶9, 706 P.2d 523. 20 Oklahoma Oncology & Hematology v. United States Oncology, Inc., 2007 OK 12, ¶27, 160 P.3d 936; Whitehorse v. Johnson, 2007 OK 11, ¶14, 156 P.3d 41; Pitco Prod. Co. v. Chaparral Energy, Inc., 2003 OK 5, ¶12, 63 P.3d 541. 21 JPMorgan Chase Bank v. Specialty Restaurants, Inc., see note 17, supra; Oxley v. General Atlantic Resources, Inc., see note 16, supra; Bonner v. Oklahoma Rock Corp., 1993 OK 131, ¶5, 863 P.2d 1176.

5f68f9d5-4656-497c-a0e8-a6d326c6666e

Gray v. Fidelity Brokerage Services

oklahoma

Oklahoma Supreme Court

GRAY v. FIDELITY BROKERAGE SERVICES2023 OK 7Case Number: 119317Decided: 02/07/2023THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. AMY GRAY, JERRY DAVID DICKMAN, JEFFERY SCOTT DICKMAN, and DEBORAH HENDERSON, Plaintiffs/Appellants,v.FIDELITY BROKERAGE SERVICES, LLC, FIDELITY MANAGEMENT TRUST COMPANY, LINDA JEANNE DICKMAN, LYNNWOOD MOORE, as Trustee of the J. Jerry Dickman, Inc. Profit Sharing Plan, and J. JERRY DICKMAN, INC., as Administrator of the J. Jerry Dickman, Inc. Profit Sharing Plan, Defendants/Appellees. ON CERTIORARI FROM THE COURT OF CIVIL APPEALS, DIVISION III ¶0 Appellants seek a declaratory judgment, recognizing them as the primary beneficiaries of a profit-sharing plan and a retirement account belonging to the decedent, their father, pursuant to an antenuptial agreement and beneficiary designations. Appellee, the wife of the decedent, counterclaimed, seeking an order declaring her the sole beneficiary based on the order of succession. The district court granted summary declaratory judgment in favor of the wife, determining she was the sole beneficiary of both accounts. The decedent's children timely appealed, and the Court of Civil Appeals reversed and remanded with instructions. This Court granted certiorari. We hold that the decedent had exclusive rights to the profit-sharing plan per the antenuptial agreement, including the right to roll over its assets to a retirement account. Further, the Court reforms the beneficiary designations to disburse the retirement account funds per Decedent's intent. However, the remaining assets in the profit-sharing plan should be distributed per the plan's beneficiary designation. COURT OF CIVIL APPEALS' OPINION VACATED;DISTRICT COURT'S JUDGMENT REVERSED AND REMANDED WITH INSTRUCTIONS. Lewis N. Carter, Stuart D. Campbell, and Jon E. Brightmire, Doerner, Saunders, Daniel & Anderson, L.L.P., Tulsa, Oklahoma, for Appellants Amy Gray, Jerry David Dickman, and Deborah Henderson. James C. Milton, Bryan J. Nowlin, and Natalie S. Sears, Hall Estill, Tulsa, Oklahoma, for Appellant Jeffrey Scott Dickman. E. Andrew Johnson and Whitney Eschenheimer, Johnson & Jones, P.C., Tulsa, Oklahoma, for Appellant Jeffrey Scott Dickman. Randall K. Calvert and Andrew R Davis, Calvert Law Firm, Oklahoma City, Oklahoma, for Appellee Linda Jeanne Dickman. Elliot P. Anderson, Crowe & Dunlevy, Tulsa, Oklahoma, for Appellees Fidelity Brokerage Services LLC and Fidelity Management Trust Company. Tony W. Haynie and C. Austin Birnie, Conner & Winters, LLP, Tulsa, Oklahoma, for Appellees Lynnwood Moore, as Trustee of the J. Jerry Dickman, Inc. Profit Sharing Plan and J. Jerry Dickman, Inc., as Administrator of the J. Jerry Dickman, Inc. Profit Sharing Plan. Winchester, J. ¶1 Appellants Amy Gray, Jerry David Dickman, Jeffrey Scott Dickman, and Deborah Henderson (collectively Children) brought this action seeking an order declaring Children as the primary beneficiaries of a Profit-Sharing Plan (PSP) and an Individual Retirement Account (IRA) belonging to their father, J. Jerry Dickman (Decedent), based on the language in an antenuptial agreement and two beneficiary designations executed by Decedent. Appellee Linda Jeanne Dickman, the wife of Decedent (Wife), sought an order declaring her the sole beneficiary based on the order of succession. The district court granted summary declaratory judgment in favor of Wife, determining she was the sole beneficiary of both the PSP and IRA. Children timely appealed, and the Court of Civil Appeals (COCA) reversed and remanded with instructions. This Court granted certiorari. ¶2 The issues in this case center on the interpretation and interplay of an antenuptial agreement between Wife and Decedent and Decedent's beneficiary designations for both the PSP and IRA. Specifically, this Court must determine (1) whether the antenuptial agreement between Wife and Decedent was broad enough to cover the PSP and to waive any right Wife had to consent to the rollover of assets from the PSP to an IRA and to designate beneficiaries; (2) whether despite the antenuptial agreement, Wife's consent was necessary under federal law to roll over the plan's assets to an IRA and designate beneficiaries; (3) whether the Court should reform the IRA beneficiary designations to give effect to Decedent's intent; and (4) whether this Court should transfer the remaining assets maintained in the PSP to the IRA. ¶3 For the reasons stated herein, we hold that the antenuptial agreement between Wife and Decedent covered the PSP, making it Decedent's separate property. Decedent had exclusive rights to the PSP, including the right to designate beneficiaries. Wife's consent was not necessary under federal law because the PSP was not an ERISA plan. We further hold Decedent substantially complied with all the requirements to designate beneficiaries to his IRA account, and the Court exercises its equitable powers to reform the beneficiary designations to disburse the IRA funds per Decedent's intent. However, Decedent never initiated the process of transferring to the IRA the remaining assets maintained in the PSP. The remaining assets should therefore be distributed per the PSP beneficiary designation. FACTS AND PROCEDURAL HISTORY ¶4 Decedent opened a PSP more than 20 years ago, which grew to approximately $13 million in value. Fidelity Brokerage Services, LLC and Fidelity Management Trust Company (collectively Fidelity) maintained a large portion of the PSP assets. Capital Advisors, Inc. (Capital) acted as an advisor to the PSP. On December 21, 2013, Decedent named Children to be equal beneficiaries of the PSP upon his death. ¶5 Decedent and Wife married on November 25, 2015. Prior to the marriage, Decedent and Wife entered into an antenuptial agreement, citing their advanced age, children from former marriages, and prior costly divorces. The agreement reserved to each party their respective property and discussed the net worth of Decedent, the majority of which was from his PSP. The agreement placed no limit on transfers during the marriage and was not intended to limit either party from taking the assets of the other by a will or intestate succession in the event of death. ¶6 In December 2017, Decedent executed a new beneficiary designation for the PSP, naming Children and Wife as equal beneficiaries of the PSP assets upon Decedent's death. Wife did not sign a post-marital waiver of the PSP assets nor did she sign any post-marital consent to the beneficiary designation. ¶7 While hospitalized in August 2019, Decedent met with his estate planning attorney and discussed a plan to roll over approximately $13 million from the PSP into an IRA. Decedent also sought to name Children and Wife as beneficiaries, designating $2.8 million each to his four children and the balance of approximately $1.8 million to Wife. ¶8 On August 30, 2019, Decedent executed the relevant IRA rollover documents. Wife was present at the time Decedent executed the documents and voiced no objection. Those documents included the IRA application as well as a beneficiary designation, which listed each of the four children as receiving $2.8 million and listed Wife as receiving the "balance." ¶9 The same day, Fidelity advised Capital that the designation of beneficiaries should be stated in percentage shares instead of dollar amounts. Capital then contacted Fidelity and advised that Decedent wanted to designate beneficiaries in dollar amounts rather than percentage shares.1 Fidelity instructed Capital that to fulfill Decedent's request, Decedent had to prepare a separate Letter of Authorization (LOA) with the designated beneficiaries and the dollar amounts Decedent desired each beneficiary to receive. Decedent executed an LOA listing the same beneficiaries and dollar amounts as the prior IRA beneficiary designation, prepared in accordance with Fidelity's instructions. The IRA was established and funded with approximately $10.2 million instead of the anticipated $13 million. This occurred because other assets valued at approximately $1.8 million were not maintained by Fidelity. ¶10 Decedent passed away two days later on September 2, 2019. At the time of Decedent's death, his attempted beneficiary designations exceeded the value of the IRA. Fidelity determined that the beneficiary designations were "Not in Good Order." Wife sought distribution of all the IRA funds to herself as the surviving spouse, and Children opposed her request. Due to the competing claims, Fidelity restricted distribution. ¶11 Children sought a declaratory judgment and injunctive relief, requesting that the district court declare each of them beneficiaries of the IRA up to $2.8 million per child and order the assets distributed. Children also sought to have the remaining PSP assets transferred to the IRA. ¶12 Wife counterclaimed and moved for summary judgment, arguing she was the sole beneficiary of both the PSP and IRA. She asserted she never consented to the rollover of the PSP assets to the IRA or to Decedent's beneficiary designations. Wife also contended Decedent's IRA beneficiary designations were invalid because they were refused by Fidelity and thus, as the surviving spouse, she should take as the primary IRA beneficiary per the agreement's standard order of succession. ¶13 Children, in turn, filed their own motion for summary judgment arguing that the antenuptial agreement prevents Wife from receiving PSP or IRA benefits as the surviving spouse and the benefits should pass to them as Decedent's named beneficiaries. The district court denied Children's motion and granted Wife's motion awarding Wife the funds in both the PSP and IRA. Children appealed. ¶14 COCA reversed the district court's grant of summary judgment to Wife and remanded for further proceedings. Wife filed a petition for rehearing, which COCA denied. We granted certiorari. STANDARD OF REVIEW ¶15 Summary judgment resolves issues of law, and we review a district court's grant of summary judgment de novo. U.S. Bank, N.A. ex rel. Credit Suisse First Boston Heat 2005--4 v. Alexander, 2012 OK 43, ¶ 13, 280 P.3d 936, 939. Using the de novo standard, we subject the record to a new and independent examination without regard to the trial court's reasoning or result. Gladstone v. Bartlesville Indep. Sch. Dist. No. 30, 2003 OK 30, ¶ 5, 66 P.3d 442, 446. The Court has plenary, independent, and non-deferential authority to determine whether the district court erred in its legal rulings. State ex rel. Protective Health Servs. State Dep't of Health v. Vaughn, 2009 OK 61, ¶ 9, 222 P.3d 1058, 1064. ANALYSIS I. Decedent had the exclusive right to roll over the PSP assets to an IRA and designate beneficiaries. ¶16 Wife first contends that she is the sole beneficiary of all the assets in the PSP because per the plan language her consent was necessary to roll over the PSP assets to the IRA and to designate beneficiaries. Children counter that the antenuptial agreement between Wife and Decedent bars Wife from making any claim to the PSP assets. We agree with Children. The antenuptial agreement between Wife and Decedent was broad enough to bar Wife from making any claim to the PSP assets (including her consent for Decedent to roll over the plan assets to the IRA and to designate beneficiaries), except for those assets which the Decedent specifically granted to her per the beneficiary designation executed after their marriage.2 ¶17 Antenuptial agreements are contracts. 84 O.S.2021, § 44; Freeman v. Freeman, 1977 OK 110, ¶¶ 1-2, 565 P.2d 365, 366-67. They are used to waive rights to property or in other ways alter the rights related to marriage, statutory or otherwise. See generally In re Estate of Cobb, 1956 OK 299, ¶ 305 P.2d 1028. An indispensable ingredient of an effective waiver is a freely exercised will to relinquish a known right; one is bound by a waiver of one's rights when made with full actual or constructive knowledge of the rights intended to be waived. Guinn v. Church of Christ Collinsville, 1989 OK 8, ¶ 29 n.42, 775 P.2d 766, 777 n.42; Faulkenberry v. Kan. City S. Ry. Co., 1979 OK 142, ¶ 6, 602 P.2d 203, 207. ¶18 Here, the PSP was specifically identified in the antenuptial agreement between Wife and Decedent. The agreement specified that Wife and Decedent acknowledged that the majority of Decedent's worth at the time of the marriage was in the PSP, and Decedent's financial statement was attached to the agreement. The PSP and its value were known to Wife when the antenuptial agreement was executed. Per the agreement, the PSP was Decedent's separate property, the same as it would be if he remained single and unmarried.3 Decedent had exclusive possession of the rights to the PSP, including the right to roll over the plan's assets and to designate beneficiaries. ¶19 Wife next argues that her consent was necessary under preemptive federal law for Decedent to designate other beneficiaries and her waiver of Decedent's PSP assets through the antenuptial agreement was ineffective.4 Although consent from a spouse is necessary under a qualified ERISA plan, the PSP was not an ERISA plan. A retirement plan is not covered by ERISA when a person is the sole shareholder and only employee of the corporation.5 There were no other employees covered under the PSP; Decedent was the sole trustee, administrator, and participant of the PSP. The cases cited by Wife rejecting a waiver of plan benefits based on an antenuptial agreement are inapplicable, and Wife's waiver of her claim to the PSP assets when she executed the antenuptial agreement is effective. Decedent therefore had the right to designate beneficiaries of the PSP, transfer the PSP funds to the IRA, and designate beneficiaries of the IRA without Wife's consent. II. Decedent's IRA beneficiary designations should be reformed to give effect to Decedent's intent. ¶20 Wife contends that Decedent's IRA beneficiary designations were invalid because Decedent did not follow the IRA agreement language when he used dollar amounts to indicate how the funds were to be dispersed to each beneficiary instead of percentage shares. We disagree. Decedent substantially complied with the requirements of the IRA agreement, and the IRA beneficiary designations should be reformed to give effect to Decedent's intent. ¶21 Oklahoma has recognized the doctrine of substantial compliance when the owner "has done all in his power to effect a change of beneficiar[y], and after his death only ministerial acts remain to be performed." Ivey v. Wood, 1963 OK 281, ¶¶ 23-24, 387 P.2d 621, 626 (quoting Harjo v. Fox, 1944 OK 81, ¶ 9, 146 P.2d 298, 301). We have applied this doctrine in the context of a beneficiary change for a life insurance policy and held that the acts and conduct of the insured are liberally viewed in favor of the insured in determining whether he did all within his power to comply with the terms of the policy to change his beneficiary. O'Neal v. O'Neal, 1942 OK 426, ¶ 8, 141 P.2d 593, 597 (noting that the exceptions to the general rule that one must comply with policy requirements are if the insured had done all reasonably within his power to comply with the requirements of the policy or if the company waived compliance); Bowser v. Bowser, 1949 OK 200, ¶ 10, 211 P.2d 517, 520 (holding the district court did not err in finding that the insured had done all he reasonably could to effect a change of beneficiaries in the policy). ¶22 We believe the doctrine of substantial compliance can be equally applied in the context of a beneficiary designation for an IRA. To illustrate, the Court has previously indicated that it saw no distinction between a life insurance policy and a state retirement account in designating beneficiaries. The Court held: We see no reason to distinguish our treatment of a claim to funds as beneficiary of an insurance policy from a claim based on designation as beneficiary as recipient of retirement funds. In either case the contract runs between the party with the power to make the designation of beneficiary and the party having the obligation to pay over funds to the beneficiary. Pepper v. Peacher, 1987 OK 71, ¶ 17, 742 P.2d 21, 25. Life insurance policies, annuities, and IRAs are similar in the respect that they all arise from contractual relationships where one party agrees to pay a sum of money on a specified contingency to a designated person called a beneficiary. Id. The proceeds pass automatically to the beneficiary. However, the beneficiary's interest is revocable by the owner during the owner's life and contingent on the beneficiary being designated as such when the owner dies. Id. We see no logical reason why the substantial compliance doctrine should not apply to our present analysis.6 The remaining issue is whether Children provided sufficient evidence to meet the standard for substantial compliance concerning Decedent's designation of beneficiaries to his IRA. ¶23 In this case, Decedent's attempt to designate beneficiaries to his IRA comes within the purview of the doctrine. Decedent executed the relevant IRA rollover documents. Those documents included the IRA application as well as a beneficiary designation which listed each of the Children as receiving $2.8 million and listed Wife as receiving the "balance." When Fidelity advised that the beneficiary designation had to be reflected by a percentage share, Capital, on behalf of Decedent, inquired into whether Decedent could designate by a dollar amount instead of a percentage. Fidelity then instructed Decedent to draft an LOA, which Decedent completed. Two days later, Decedent passed away without any further communication from Fidelity. Decedent reasonably believed that he had complied with Fidelity's requirements and had no reason to believe that he had not properly designated beneficiaries for his IRA. Under the facts of this case, Decedent had done everything in his power to designate beneficiaries and followed Fidelity's instructions.7 ¶24 Further, exact compliance with the contractual requirements is not necessary when, as in this case, the custodian of the IRA waives compliance with those requirements. O'Neal, 1942 OK 426, ¶ 8, 141 P.2d at 597; Carson v. Carson, 1933 OK 549, ¶¶ 18-19, 26 P.2d 738, 741. Decedent complied with the requirements in the IRA documents, which states that a beneficiary must be designated on the account application or in another form or manner acceptable to the custodian of the IRA. Fidelity communicated to Decedent that it was not necessary that he use a percentage in designating the amount to be dispersed to the beneficiaries and that he could designate a dollar amount by using an LOA, which he did. Fidelity took no position with respect to the parties' dispute and awaits a judicial determination of the proper payee. We also note that the formal procedures that a company requires to establish an IRA are in place to protect the company. See Bowser, 1949 OK 200, ¶ 8, 211 P.2d at 519. Thus, an individual contending to be a beneficiary is without the right to insist upon strict compliance with those requirements. Fidelity's waiver of its contractual requirement that a percentage be used allows the Court to disregard this formality and determine the proper payees based on an evaluation of the evidence of Decedent's intent. ¶25 The next issue we must address is how to disburse the funds of the IRA to the designated beneficiaries since the IRA is underfunded compared to the dollar amounts designated by Decedent. The Court has held that a written agreement may be reformed by a court of equity. Boettler v. Rothmire, 1968 OK 91, ¶¶ 16-17, 442 P.2d 511, 514-15. The Court can use its equitable powers when the execution of an agreement is procured through a unilateral mistake, like in this case, on the part of Decedent. Smiley v. Jaggers, 1958 OK 167, ¶ 5, 327 P.2d 652, 654. The goal of reformation for a mistake is to ensure that the intent of the Decedent is carried out and the parties are placed where they would have stood if the mistake had not occurred. Shoemaker v. Estate of Freeman, 1998 OK 17, ¶¶ 19-20, 967 P.2d 871, 876; Griffin v. Griffin, 1992 OK 36, ¶ 14, 832 P.2d 810, 813. ¶26 Both Capitol and Decedent believed that $13 million was to be transferred to the IRA. However, a mutual mistake in the belief that all the assets were maintained by Fidelity caused there to be underfunding of the IRA to disburse to the beneficiaries the dollar amounts written on the beneficiary designation. The Court reforms the beneficiary designation and converts the dollar amounts specified by Decedent to a percentage that is equal to what Decedent intended. The fact that less than $13 million was transferred to the IRA does not change Decedent's clear intent of whom he designated as beneficiaries. It is further undisputed that Decedent intended to give $2.8 million to each of the four children of the approximately $13 million in the PSP, which equates to 86% of the total amount in the PSP (or a 21.5% share to each of the four children). Likewise, 21.5% of the approximately $10.2 million transferred to the IRA should be distributed to each of Children, with the remainder 14% share going to Wife. III. The Court will not use its equitable powers to transfer the remaining assets maintained in the PSP to the IRA. ¶27 The final issue we must determine is whether this Court should transfer the remaining assets maintained in the PSP to the IRA. Children argue this Court has the equitable power to order this transference. However, Children are not requesting that this Court reform a contract but instead create a contract. An agreement to transfer the self-custody assets from the PSP to the IRA was never executed by Decedent. The PSP provides that a participant may request a lump-sum distribution. If the request is approved, the administrator must execute the proper documents to effect the distribution. None of these events occurred here. Therefore, Children's reliance on equitable reformation is misplaced with regard to the remaining assets in the PSP. Instead, the remaining assets in the PSP should be distributed per the beneficiary designation. Since the beneficiaries of the PSP are Children and Wife as equal beneficiaries, the remaining assets in the PSP should each be split equally among the beneficiaries.8 CONCLUSION ¶28 Decedent had exclusive possession of the rights to his PSP, including the right to roll over the assets into an IRA and designate beneficiaries. Decedent substantially complied with all the requirements to designate beneficiaries to his IRA account, and the Court uses its equitable powers to reform the beneficiary designations to give Children a 21.5% percentage share that Decedent intended, with the remainder going to Wife. However, the remaining assets in the PSP should be distributed per the PSP beneficiary designation because Decedent never initiated the process of transferring to the IRA the remaining assets maintained in the PSP. Based upon our analysis, we reverse the district court's judgment in favor of Wife, and we remand for proceedings consistent with this opinion. COURT OF CIVIL APPEALS' OPINION VACATED;DISTRICT COURT'S JUDGMENT REVERSEDAND REMANDED WITH INSTRUCTIONS. Kane, C.J., Rowe, V.C.J., Kauger, Winchester, Edmondson, Combs, Darby, and Kuehn, JJ., concur. Gurich, J., recused. FOOTNOTES 1 Decedent's estate lawyer confirmed that Decedent's intent was to give Children an amount that would avoid each of them having to pay any estate taxes. 2 We note that neither Wife nor Children raised any issue concerning the validity or fairness of the antenuptial agreement. 3 The Antenuptial Agreement states: Section 1. Property 1.1 Jeannie's Property. All property, real and personal, now and owned or hereafter acquired by Jeannie by purchase, sale, exchange, gift, devise, bequest, succession, or otherwise, shall be and remain her sole and separate property after the marriage the same as it would be if she remained single and unmarried. 1.2 Jerry's Property. All property now owned or hereafter acquired by Jerry by purchase, sale, exchange, gift, devise, bequest, succession, or otherwise, shall be and remain his separate property the same as it would be if he remained single and unmarried. 4 ERISA mandates that pension plans provide automatic survivor benefits to surviving spouses. 29 U.S.C. § 1055 (2018). The surviving spouse's annuity cannot be waived unless the spouse consents to the designation of an alternate beneficiary in writing and in compliance with 29 U.S.C. § 1055(c)(1), (2) (2018). 5 A "benefit plan is subject to ERISA only if it provides benefits to at least one employee." Sipma v. Mass. Cas. Ins. Co., 256 F.3d 1006, 1009 (10th Cir. 2001). Under the applicable regulations, the definition of employee does not include a sole owner or an individual and spouse who together have complete ownership. See id. at 1011; 29 C.F.R. § 2510.3--3(c). Plans that cover only sole owners or partners and their spouses fall outside ERISA's domain. Raymond B. Yates, M.D., P.C. Profit Sharing Plan v. Hendon, 541 U.S. 1, 6 (2004). 6 Other jurisdictions have also applied the substantial compliance doctrine to a change of beneficiary for an IRA. See, e.g., In re Estate of Golas, 751 A.2d 229, 232-33 (Pa. Super. Ct. 2000) (invoking substantial compliance to affirm the award of proceeds of an IRA account to the executors of the accountholder's estate, instead of the first designated beneficiary, where a terminally ill accountholder requested change of beneficiary forms but failed to receive them before his death). 7 Internal Revenue Service regulations that govern such IRAs expressly provide for distributions of the IRA to beneficiaries upon the death of the owner and define "beneficiaries" to include "any person designated by the [owner] to share in the benefits of the account after death of the [owner]." 26 C.F.R. § 1.408-2(b)(7), (8) (2022). However, neither federal statutory law nor federal regulations prescribe how a beneficiary is to be designated. 8 We agree with COCA's Order denying Wife's motion to strike Children's Amended Petition in Error due to their alleged noncompliance with the Oklahoma Supreme Court Rules filed on July 22, 2021. See Supreme Court Rule 2.1, 12 O.S.2021, ch. 15., app. 1.

101b2a4a-6387-4ba7-8b2c-68e2a5be65f1

Scungio v. Scungio

oklahoma

Oklahoma Supreme Court

SCUNGIO v. SCUNGIO2012 OK 90Case Number: 110251Decided: 10/30/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. Mark Anthony Scungio, Appellee, v. Margaret Sue Scungio, Appellant. CERTIORARI REVIEW OF CERTIFIED INTERLOCUTORY ORDER FROM DISTRICT COURT OF OKLAHOMA COUNTY ¶0 The Oklahoma Department of Human Services filed a "Motion to Determine [Child Support] Arrearage" and a "Motion to Modify [reduce] Child Support" in its administrative court on behalf of the father of children receiving child support services. The mother moved to dismiss the motion to modify based on provisions of the parties' settlement agreement which had been incorporated into their divorce decree. The administrative law judge issued an order transferring the matter to the District Court of Oklahoma County and filed it in the divorce action. Mother moved to dismiss the motion to modify in the district court. The trial court, Honorable Lynne McGuire, denied the motion to dismiss, holding that the parties' agreement failed to demonstrate an intent to be free from the statutory provisions governing modification of child support. The order was certified for immediate appeal and this Court granted certiorari review of the certified interlocutory order. CERTIORARI TO REVIEW CERTIFIED INTERLOCUTORY ORDER PREVIOUSLY GRANTED; ORDER REVERSED; CAUSE REMANDED. Floyd W. Taylor, Kevin S. Taylor, The Taylor Law Firm, P.L.L.C., Oklahoma City, for Appellant. Jay F. McCown, Tamra A. Spradlin, Michelle K. Smith, A. Seth Killman, Father's Parental Rights Law Center, Oklahoma City, for Appellee. COLBERT, V.C.J. ¶1 This Court granted certiorari review of a certified interlocutory order to address two issues which concern modification of child support: (1) Was a motion to modify properly before the district court for its determination? (2) Do the four corners of the divorce decree in this matter demonstrate the parties' intent to be free of the statutory provisions concerning modification of child support? This Court holds the procedural vehicle utilized to place the motion to modify child support before the district court was authorized by statute. Additionally, the parties clearly demonstrated their intent that there be no modification of child support without their mutual assent and it was error for the district court to hold to the contrary. FACTS AND PROCEDURAL HISTORY ¶2 In September, 2001, Mark Anthony Scungio (Father) and Margaret Sue Scungio (Mother) adopted their three foster children, siblings, two of whom were special needs children with serious psychological disabilities. In July, 2004, in contemplation of divorce, the parties entered into a written agreement titled "Contractual Agreement - Separation and Parenting Plan to be incorporated into divorce decree." A divorce action was filed in 2007 and the document was incorporated into the divorce decree in October, 2009. Under the Agreement, Mother became the custodial parent and Father assumed support obligations. ¶3 The Agreement and the divorce decree recited facts that are key to understanding the parties' intent concerning child support at the time of contracting. The parties were married in California in 1988 and have resided in Oklahoma since 1991. In the 2004 Agreement, Father admitted he committed "emotional abuse to his wife and children such that irreconcilable differences have arisen between the parties in consequence of which the parties are now living separate and apart." Concerning child support, the Agreement provided: "Husband agrees that his emotional abuse toward Wife and children exacerbated the any [sic] mental illnesses preexisting in the children and as such he has an even greater responsibility to support them." The Agreement also acknowledged that each parent: agrees that he or she understands that due to the psychiatric disabilities of [two of the children], their disabilities may continue into adulthood, and that either or both may require substantial care and personal supervision and may not be capable of self-support and that under [the applicable Oklahoma Statutes] it is the parent's duty to maintain such person. If such is the case, the Mother agrees to provide the continued care beyond the age of majority and the Father agrees to provide continued child support as established above. The Agreement set a formula for the calculation and payment of child support which provided: Husband agrees to pay Wife, as child support, an amount that when added to the support alimony . . . of $615.00 per month equals one half his military base pay (gross) or an amount equal to one half his highest base pay (gross) minus $615.00 in the event he leaves the military or retires in the form of child support with increases cost of living (COLA) adjustments, raises, and grade increases. Child support will be payable on the first of each month in the form of an allotment into Wife's checking account and will be payable upon the signing of this Contractual Agreement in the amount of $1035.00 ( 2004 E-7 pay at 18 years in service) per month and will continue to be paid by the first of each month until all three children reach the age of majority and becomes [sic] self-supporting or 22 if attending college. Thus, the Agreement provided terms and a formula that provided for more than what was required by the guidelines set out in the Oklahoma Statutes in order to meet the special needs of two of their children.1 ¶4 Father's child support payments were in significant arrearage at the time of divorce and have remained so. Before the divorce trial in October, 2009, Father retired from the United States Air Force and child support was calculated using the formula set out in the Agreement. A divorce was pronounced from the bench at trial. In December, 2009, the DHS filed a "Notice of Necessary Party" in the divorce action which outlined the services that the DHS was providing for the minor children and notifying the District Court that it was a necessary party concerning "child support, medical support, and any debt due the State of Oklahoma." At the same time, the DHS filed a "Notice of Redirection of Support Payments" directing such payments to the Oklahoma Centralized Support Registry. The decree which incorporated the Agreement was signed and filed on March 30, 2010. ¶5 On May 12, 2010, the Office of Administrative Hearings: Child Support Department of Human Services issued a "Notice to Review and Modify Support Order." The DHS asserted that the child support award was not in accord with the child support guidelines and that a change in Father's income required a reduction in the amount of his child support. A hearing was held before an administrative law judge on October 28, 2010, and an administrative "Court Minute" was issued which provided: Now on this 28th day of October, 2010, Petitioner appears in person, pro se Respondent appears in person and with counsel, Floyd Taylor. State appears thru counsel, Kelli S. Price. After review of the pleadings and issues in this matter this court determines as follows: In the interest of judicial economy and in order to resolve all issues herein this matter shall be and is hereby transferred to the Oklahoma County District Court. The State shall set a MTDA & set this matter for hearing and the parties shall be notified by regular mail. All parties are ordered to appear for further hearings in this matter. On November 10, 2010, an administrative law judge ordered the matter transferred to the District Court of Oklahoma County. ¶6 On December 30, 2010, The DHS filed in the divorce action a "Request to Docket Administrative Order" on behalf of "Plaintiff" in order to enforce the October 28, 2010, administrative minute order. In addition it filed a "Motion to Determine Arrearage" in the divorce action asking the court to settle "a dispute as to the arrearage owed" and set a judgment payment. The DHS did not file a motion to modify Father's child support in the divorce action apparently taking the position that a new motion was unnecessary. ¶7 On July 18, 2011, Mother moved to dismiss the DHS motion to modify child support which had been filed in the administrative action. She relied on this Court's decision in Parham v. Parham, 2010 OK 24, 236 P.3d 74, and argued the Agreement clearly expressed an intent that child support not be subject to the statutory requirement of modification in the event of a change in Father's income. Additionally, Mother argued that the procedure by which the administrative law judge "transferred" the matter to the district court was not authorized by statute. ¶8 The trial court denied Mother's motion to dismiss the request for modification of child support without addressing the procedural issue and holding that Mother "failed to demonstrate an intention by the parties to the Separation Agreement not to be subject to the statutory conditions for modification of child support." The trial court set the motion to modify child support for an evidentiary hearing. Father joined Mother in urging that the order be certified for interlocutory appeal. The order was certified and this Court granted certiorari review of the procedural issue as well as the substantive issue presented in this matter. STANDARD OF REVIEW ¶9 "The courts will decide, as a matter of law, whether a contract provision is ambiguous and interpret the contract provision as a matter of law where the ambiguity can be cleared by reference to other provisions or where the ambiguity arises from the contract language and not from extrinsic facts." Oklahoma Oncology & Hematology, P.C. v. US Oncology, Inc., 2007 OK 12, ¶ 27, 160 P.3d 936, 946 (citations omitted). Issues of law are reviewed de novo. Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶ 14, 859 P.2d 1081, 1084. Whether the transfer procedure, utilized by the administrative law judge to place the issue of child support modification before the District Court , is authorized by statute presents a question of law for this Court's de novo review. THRESHOLD PROCEDURAL ISSUE ¶10 This matter presents a threshold issue of procedure concerning whether a motion to modify child custody was properly before the district court. Mother contends that the transfer procedure utilized by the DHS administrative law judge is not authorized by statute and that Father was required to file another motion to modify in the district court divorce action. Father argues that the transfer was merely one of forum or venue and there was no need to file a new motion. ¶11 Section 240.1 of title 56 authorizes the review of child support orders when child support services are provided by the DHS: A.1. In cases in which child support services are being provided by the Child Support Enforcement Division of the Oklahoma Department of Human Services, the Division may: a. initiate enforcement proceedings to: (1) obtain a judgment for arrearages, (2) effectuate an income assignment, (3) receive current support and judgment payments, and (4) review and modify support orders pursuant to child support guidelines in Section 118 of Title 43 of the Oklahoma Statutes, b. initiate any other legal proceeding to implement the establishment and collection of support and other court-ordered requirements of support from an obligor including, but not limited to, medical expenses, insurance premiums, and child care costs, and, c. appeal orders as necessary to implement the provisions of this section. Okla. Stat. tit. 56, § 240.1(A) (2011). Section 118.1(A) of title 43 outlines the process for such reviews and provides that an order of modification may be set by the DHS in administrative or district court. It provides: In all cases in which child support services are being provided under the state child support plan as provided in Section 237 of Title 56 of the Oklahoma Statutes, the Department shall conduct reviews of child support orders pursuant to rules promulgated by the Department. If the Department conducts a review and determines that the child support obligation is not in accordance with child support guidelines, the Department shall file a notice of review and intent to modify the child support order, and it shall be served upon the parties in accordance with law. The notice shall be set for hearing before a district or administrative court. The district or administrative court shall review the child support obligation to determine its compliance with the child support guidelines and order modification if appropriate. An order of modification shall be effective upon the date the notice of review and intent to modify the child support order was filed. Okla. Stat. tit. 43, § 118.1(A) (2011)(emphasis added). Thus, the administrative court and the district court are given concurrent jurisdiction to review and, if necessary, modify a child support order to bring it into compliance with the minimum support obligations provided by statute. "In filing cases involving concurrent jurisdiction between the administrative proceedings of the Department of Human Services and the district court, the cases shall be filed in the administrative proceedings of the Department of Human Services." Okla. Stat. tit. 56, § 240.9 (2011). The order of the administrative court may be appealed to the district court. Okla. Stat. tit. 56, § 240.1(A)(1)(c) (2011). An order that was not appealed may be docketed in the county of the underlying district court order for enforcement. Okla. Stat. tit. 56, § 237.10 (2011). ¶12 The statutory provisions for modification were followed in this matter and an administrative proceeding was initiated in the administrative court. After reviewing the matter, however, the administrative law judge determined that the interests of judicial economy and efficient resolution of all the issues presented required that the matter be transferred for the district court's determination. The administrative law judge did so by "docketing" the order so that the district court could construe the Agreement which it had incorporated into the divorce decree. ¶13 Although a "transfer" process is not specifically described in the statutory provisions for modification of child support, the authority of the administrative law judge to utilize that process is necessarily implied by the concurrent jurisdiction granted to the administrative and district courts to review and modify child support orders. See Okla Stat. tit. 43, § 118.1(A) (2011); Okla. Stat. tit. 56, § 240.9 (2011). Therefore, the transfer procedure utilized to place the motion before the district court was entirely appropriate and Father was not required to file a new motion to modify child support. The filing of a second motion to modify would merely have created confusion as to which filing would control the effective date of the modification. PRIMARY SUBSTANTIVE ISSUE ¶14 The primary dispute concerning modification of child support has arisen from two provisions in the Agreement. Section 15, titled "Modification", provides: "The provisions of this Contractual Agreement shall not be modified or changed except by the written mutual consent of the parties or their respective heirs, executors, administrators and assigns." In contrast, the "Governing Law" provision of the Agreement, found at Section 17, provides: "This Contractual Agreement shall be construed and governed in accordance with the laws of the State of Oklahoma." It then lists parenthetically the following statutory provisions that were in effect at the time of contracting: "Title 10, Sections 12 and 21.1, Title 15, Chapter 1. Title 43, Sections 101-103, 109, 110, 112, 112.1A, 113, 118-121, 134, 136, and 205 and Title 56, Sections 235+." At the time of contracting, section 118 of title 43 provided that "child support orders may be modified upon a material change in circumstances which includes, but is not limited to, an increase or decrease in income . . .." Okla Stat. tit. 43, § 118(E)(16)(a)(1) (Supp. 2008). As of 2009, that provision appears at section 118 I of title 43. ¶15 Father argues that the "no modification" provision of the Agreement directly conflicts with the "governing law" provision such that it renders the Agreement ambiguous. Father asserts that, because there is an ambiguity, the Agreement cannot constitute a clear expression of the parties' to be free from the statutory strictures of the child support modification statute as required by this Court's decision in Parham v. Parham, 2010 OK 24, 236 P.3d 74. Mother asserts that by merely including a choice of law provision the parties did not create ambiguity in their expressed intent to deviate from the child support statutes in order to establish a plan to further the best interests of the children, two of whom have profound psychological disabilities. ¶16 Parham and the decisions on which it was based establish the requirements concerning the special conditions for the termination or modification of child support which divorcing parents may set. There is no "absolute rule forbidding consent decrees from being modified without the parties' mutual consent." Parham, 2010 OK 24, ¶ 17, 236 P.3d at 78. Although a mutual consent provision is permissible, it is not automatically given effect. To effectuate such a provision, the parties must "expressly address termination and modification" and "clearly express that they do not intend for a particular support obligation to be subject to statutory provisions governing termination or modification." Id. Although "an express waiver of statutory rights in a consent decree is not required, . . . the parties must nonetheless demonstrate intent to avoid the strictures of a particular statute." Id. at n.7 (citing Kitteredge v. Kitteredge, 1995 OK 30, ¶ 5, 911 P.2d 903, 904). Further, the rule is subject to the following caveat: In recognizing that the parties have some latitude to agree upon special conditions for termination or modification of child support, we do not depart from this Court's long standing rule that an agreement of the parties as to child support is not binding upon the court, nor can such agreement affect the power of the court to modify an award of child support. Parkey v. Parkey, 1962 OK 110, ¶¶ 18-19, 371 P.2d 711, 714. Enforcement of any conditions concerning the termination or modification of child support that differ from the conditions provided by statute must always be guided by the best interests of the child. Id., ¶ 18 n.8, 236 P.3d at 78. ¶17 Under the rule articulated in Parham, the parties must clearly express their intent to establish a plan for termination or modification of child support that avoids the statutory requirements. The statutory requirements concerning child support act as a procedural and substantive floor upon which the parties may add additional provisions for child support by their agreement. The parties are not free, of course, to establish child support in an amount less than that required by law or for a period of time that is less than the applicable statutes provide. To do so would be contrary to the best interests of the child and would render the child support order subject to judicial correction. ¶18 As with any contract, the parties' intent concerning their child support agreement is controlling. "A contract must be so interpreted as to give effect to the mutual intention of the parties, as it existed at the time of contracting, so far as the same is ascertainable and lawful." Okla. Stat. tit. 15, § 152 (2011). That intent is to be "ascertained from the four corners of the contract, and where the language is ambiguous, it will be interpreted in a fair and reasonable sense." Oklahoma Oncology , 2007 OK 12, ¶ 27, 160 P.3d at 946 citing Mortgage Clearing Corp. v. Baughman Lumber Co., 1967 OK 232, ¶ 13, 435 P.2d 135, 139; Okla. Stat. tit. 15, §§ 155 & 157.2 "The construction of an ambiguous contract is a question of law for the court where the ambiguity can be clarified by reference to other parts of the contract, or where the ambiguity arises by reason of the language used and not because of extrinsic facts." Paclawski v. Bristol Laboratories, Inc., 1967 OK 21, ¶ 24, 425 P.2d 452, 456. In addition, "[a] contract may be explained by reference to the circumstances under which it was made, and the matter to which it relates." Okla. Stat. tit. 15, § 163 (2011). Thus, when an ambiguity arises from the language of a contract, intent must be determined from the four corners of the contract including the facts and circumstances surrounding its making. The court's duty is not to merely choose between competing interpretations of the contract language that the parties assert in litigation. ¶19 The Agreement in this matter presents a choice of law provision that conflicts with the "no modification without the written consent of the parties" provision. The question becomes whether the choice of law provision was intended to make the cited law control exclusively, in which the "no modification" provision would be surplusage, or whether the parties intended no modification without mutual consent even when one of the cited statutes provides for judicial modification of child support upon a change in income. The two provisions cannot be harmonized and thus there is ambiguity as to the parties' intent at the time of contracting. The ambiguity, however, is easily cleared from the facts and circumstances surrounding the Agreement which are recited in the four corners of the document. ¶20 Considering the recited facts and circumstances surrounding the execution of the Agreement, the intent to establish a plan for meeting the special needs of the children is evident from the four corners of the contract. The parties to the Agreement clearly and expressly contemplated a plan by which Mother would obtain sole legal and physical custody of the three children, two of whom have special needs, and Father would assume financial responsibility beyond the child support guidelines which would continue beyond the children's majority. That plan contemplated Father's retirement from the Air Force and provided for that event. Father's present assertion that no such intent was expressed in the Agreement is not in accord with the four corners of the Agreement. ¶21 In this matter, the parties Agreement articulated the circumstances surrounding their decision to depart from the statutory minimum child support provisions and establish an alternative plan to better meet the needs of their children. They expressly chose to make that plan unmodifiable without their mutual written consent. Those circumstances and the text of the Agreement demonstrate a clearly expressed intent to be free from the statutory strictures of the child support modification provisions. The trial court erred by failing to give effect to that intent. On remand, the trial court is directed to deny the petition to modify child support.3 CERTIORARI TO REVIEW CERTIFIED INTERLOCUTORY ORDER PREVIOUSLY GRANTED; ORDER REVERSED; CAUSE REMANDED. CONCUR: Taylor, C.J.; Colbert, V.C.J.; Kauger, Watt, Winchester, Edmondson, Reif, Combs, JJ. DISQUALIFIED: Gurich, J. FOOTNOTES 1 The Agreement contemplated Father's retirement and, in addition to child support, made the following provision for alimony: Husband agrees that [two of the children] were known to be emotionally disturbed prior to adoption and that they are currently psychiatrically disabled to the extent to which they require substantial care and personal supervision such that Wife is now unable to work. Furthermore, the many psychiatric professionals involved with [the two children] say that in the next few years their need for care and supervision may only increase. Therefore, Husband agrees to pay Wife the sum of $615.00 alimony per month by the first of each month in the form of an allotment into Wife's checking account commencing with the signing of this Contractual Agreement and each month thereafter until all three children are no longer dependent on Wife for her care and supervision that is to include adult children. At such time as Husband retires from the military if the share of retirement pay due to Wife is greater than what would be due in alimony, then when retirement pay starts, support alimony will cease. If retirement pay is less that the amount due in alimony, th[e]n Husband agrees to pay the difference to the sum of $615.00. Note: The retirement pay is part of the property division and is not alimony. Wife accepts the payments specified in and to be made under this section in full satisfaction and settlement of all her right, claim and demand against Husband for support, maintenance and alimony excluding retirement pay which will continue permanently. Furthermore, if Husband chooses to forgo his federal pension and leave the military early, he agrees to provide the $615.00 alimony [which] will continue permanently. The amount of alimony was changed to $265.00 when the contract was executed in 2004. 2 "When a contract is reduced to writing, the intention of the parties is to be ascertained from the writing alone, if possible, subject, however, to the other provisions of this article." Okla. Stat. tit. 15, § 155 (2011). "The whole of a contract is to be taken together, so as to give effect to every part, if reasonably practicable, each clause helping to interpret the others." Okla. Stat. tit. 15, § 157 (2011). 3 Mother's request for attorney fees is beyond the scope of the two issues certified by the trial court for interlocutory review. It is therefore denied.

3cc3258c-e864-4a77-906f-c42cf068f385

Prince v. Brake Rebuilders & Friction Products, Inc.

oklahoma

Oklahoma Supreme Court

PRINCE v. BRAKE REBUILDERS & FRICTION PRODUCTS, INC.2012 OK 104Case Number: 109516Decided: 12/04/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CHARLES PRINCE, Petitioner, v. BRAKE REBUILDERS & FRICTION PRODUCTS, INC., TRUCK INSURANCE EXCHANGE and THE WORKERS' COMPENSATION COURT, Respondents. PROCEEDING TO REVIEW AN ORDER OF A THREE-JUDGE PANEL OF THE WORKERS' COMPENSATION COURT ¶0 Workers' Compensation claimant Charles Prince was injured in a cumulative trauma employment-related accident, with date of last exposure on December 24, 2008. Claimant sought compensation for injury to his right foot, and later for his low back arising from the same injury. The trial court of the Workers' Compensation Court denied his claim for the low back, and the three judge panel affirmed. On appeal the Court of Civil Appeals vacated the order of the three judge panel which affirmed the denial of benefits, holding the order was against the clear weight of the evidence. This Court previously granted certiorari. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I; COURT OF CIVIL APPEALS' OPINION IS VACATED; WORKERS' COMPENSATION COURT'S ORDER IS SUSTAINED; REMANDED FOR FURTHER PROCEEDINGS Susan H. Jones, Tulsa, Oklahoma, for Petitioner, Jerry Freeman, Oklahoma City, Oklahoma, for Respondents. OPINION WATT, J.: ¶1 Charles Prince (Claimant) filed a claim in the Workers' Compensation Court on January 13, 2009, alleging a cumulative trauma employment-related injury to his right foot, with date of last exposure on November 24, 2008. On April 28, 2009, the trial court found Claimant sustained a cumulative trauma injury to his right foot and ordered Employer, Brake Rebuilders & Friction Products, Inc., to select a physician to treat Claimant and to provide "such medical, surgical or other attendance or treatment, nurse and hospital service, medicine, diagnostic testing and referral as may be deemed necessary by the treating physician to the claimant's right foot." The court found his date of last exposure was November 24, 2008. ¶2 Claimant later amended his Form 3 on July 23, 2009, to add his low back as a cumulative trauma injury arising out of his original injury. On December 9, 2010, the trial court denied his claim for his low back injury and ordered the prior order "remains in full force and effect except the date of last exposure is corrected to be December 24, 2008." On May 5, 2011, a three judge panel affirmed the trial court's order. Claimant appealed. ¶3 In a published opinion filed November 18, 2011, the Court of Civil Appeals (COCA) vacated the order of the three judge panel and remanded the case for further proceedings. In its opinion at ¶17, COCA held as follows: Additionally, Claimant testified he currently had pain in his back even though it initially had manifested only as foot and ankle pain. That Claimant sustained a work-related cumulative trauma back injury is supported by the clear weight of the evidence. Therefore, the order of the three-judge panel affirming the trial court's denial of a work-related cumulative trauma back injury is not supported by the clear weight of the evidence. 85 O.S. Supp. 2011 §340(D). ¶4 Employer sought certiorari review which this Court granted on February 29, 2012. In its petition, Employer contends COCA erred in applying "the clear weight" standard because the injury arose before either the 2010 amendment to 85 O.S. §3.6(C),1 or the enactment of the new Workers' Compensation Code (the Code), 85 O.S. 2011 §§301-413, effective August 26, 2011, specifically §340(D).2 Those amendments changed the standard of review in workers' compensation cases to "the clear weight of the evidence" standard from the prior standard of "any competent evidence" announced in Parks v. Norman Municipal Hospital.3 Employer argues that Claimant's date of injury is the date which determines his substantive rights in connection with his claim. That date has been established as December 24, 2008, the date of last exposure, which neither party disputes. ¶5 COCA's opinion contains no discussion of whether the date of the injury establishes anything more than whether the claim was timely filed or whether the correct rate of compensation was used. Although the opinion indicates the claimant argued the date of his injury required consideration of his appeal under the "any competent evidence" standard, it instead analyzed the evidence under "the clear weight" standard because of the statutory language in §340(D), "regardless of the date of injury." Based on the clear weight of the evidence, COCA held the three judge panel erred in affirming the denial of the claim for the low back. It vacated and remanded for further proceedings. Now, Employer argues COCA should have used the "any competent evidence" standard to affirm the three judge panel's denial of benefits for claimant's low back injury because it occurred before the statutory amendments. We agree. ¶6 The date of the injury in a workers' compensation case determines the law which governs a claim brought by an injured employee. We addressed a similar issue in our recent case of Williams Companies, Inc. v. Kristy Dunkelgod and the Workers' Compensation Court, 2012 OK 96, ___ P.3d ___, on November 20, 2012, which determines the present case. In Dunkelgod, the claimant, rather than the employer, argued in favor of the application of the "any competent evidence" standard because the date of injury preceded August 26, 2011. We held the standard of review was a substantive right which had accrued when the claimant became entitled to bring her claim against the employer and receive compensation. Thus, we held the new statute, 85 O.S. §340(D), was inapplicable to any claim which had accrued before August 26, 2011. In Dunkelgod, the claim accrued on June 11, 2001, the date of her injury. In the present case, the claim accrued on December 24, 2008, the date of claimant's last exposure. In each instance, the law prior to August 26, 2011 applies, and the "any competent evidence" standard of review must be applied. ¶7 Section 340(D) is substantive and cannot be applied to injuries which occurred before August 26, 2011. In Dunkelgod, supra, we held: ¶14 A cause of action accrues when the plaintiff could have first maintained an action. See gen., Cowart v. Piper Aircraft Corporation, 1983 OK 66, 665 P.2d 315, 318. In workers' compensation cases, the claim accrues on the date of the injury. King Manufacturing v. Meadows, 2005 OK 78, 127 P.3d 584; Independent School District No. 89 v. McReynolds, 1974 OK 136, 528 P.2d 313; Spec. Ind. Fund v. Michaud, 1959 OK 203, 345 P.2d 891; and General Electric Co. v. Folsom, 1958 OK 279; 332 P.2d 950. The date of injury or death also determines the compensation allowed a particular claimant. Independent School District No. 89 v. McReynolds, 1974 OK 136, 528 P.2d 313; Spec. Ind. Fund v. Michaud, supra; and General Electric Co. v. Folsom, supra. . . . ¶16 The Oklahoma Constitution guarantees that any cause of action which has accrued may not be destroyed by the Legislature after the suit has been commenced. Similarly, claims which have become barred, due to the passage of time or by statute, may not be revived by the Legislature. See Okla. Const., Art. 5, §52: Revival of rights or remedies - Taking away cause of action or defense The Legislature shall have no power to revive any right or remedy which may have become barred by lapse of time, or by any statute of this State. After suit has been commenced on any cause of action, the Legislature shall have no power to take away such cause of action, or destroy any existing defense to such suit. [emphasis added]. ¶17 Additionally, accrued rights and proceedings begun pursuant to statute are protected against the repeal of those statutes. See Okla. Const., Art 5, § 54:4 Repeal of statute - Effect The repeal of a statute shall not revive a statute previously repealed by such statute, nor shall such repeal affect any accrued right, or penalty incurred, or proceedings begun by virtue of such repealed statute. ¶18 The standard of review applicable to a workers' compensation appeal is that which is in effect when the claim accrues. It is determined as of the date of injury and is a substantive right which remains unaffected by later-enacted legislation, despite statutory language to the contrary. See Dunlap,5 Nomac,6 supra; Okla. Const., Art. 5, §§52, 54. Our constitution protects the accrual of a cause of action so that a person's failure to exercise rights under a statute prior to the statute's repeal does not result in the loss of those rights. Hammons v. Muskogee Medical Center Authority, 1985 OK 22, 697 P.2d 539, 542. Generally, a statute or its amendments will have only prospective effect unless it clearly provides otherwise. Id. While the statute at issue, §340(D), provides that the date of injury is irrelevant, applying this provision as written would allow the unconstitutional abrogation of an accrued right. Hammons, supra, at 542. ¶8 In the present case, the denial of the award for Claimant's lower back was supported by competent evidence, the standard of review which is applicable to this case. Neither party objected to the medical evidence presented. COCA found more evidence in support of Claimant's low back injury, but Employer presented evidence from its medical expert which denied that the injury to either the low back or the right foot arose out of Claimant's employment. The date of the injury determines the law to be used in a workers' compensation claim and applies equally to employers and claimants alike. See Dunkelgod, supra. ¶9 Based on our decision in Dunkelgod, supra, and the law on the date of Claimant's injury, the opinion of the Court of Civil Appeals is vacated. ¶10 COURT OF CIVIL APPEALS' OPINION IS VACATED; WORKERS' COMPENSATION COURT'S ORDER IS SUSTAINED; REMANDED FOR FURTHER PROCEEDINGS COLBERT, V.C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, REIF, COMBS, JJ. - CONCUR TAYLOR, C.J., GURICH, J. - CONCUR IN RESULT FOOTNOTES 1 85 O.S. 2001 §3.6(C ) was amended on November 1, 2010, as follows: C. [T]he Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds: . . . 4. The order or award was against the clear weight of the evidence. 2 85 O.S. 2011 §340(D) provides: D. [A]fter the effective date of this act, regardless of the date of injury, the Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds: . . . 4. The order or award was against the clear weight of the evidence. [emphasis added] 3 1984 OK 53, 684 P.2d 548. 4 We held in Cowart, supra, that Art. 5, §54 prohibited the repeal of an act from destroying a cause of action which had already accrued, even though the action had not been filed before the statute was repealed. 665 P.2d at 317-318. 5 Dunlap v. The Multiple Injury Trust Fund, 2011 OK 14, 249 P.3d 951. 6 Nomac Drilling LLC v. Mowdy, 2012 OK 45, 277 P.3d 1282.

dc2fdaf9-2dbc-40a9-9ba6-2d409f09f224

Jordan v. Western Farmers Electric Cooperative

oklahoma

Oklahoma Supreme Court

JORDAN v. WESTERN FARMERS ELECTRIC COOPERATIVE2012 OK 94Case Number: 108550Decided: 11/13/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. DAVID JORDAN, Plaintiff/Appellant,v.WESTERN FARMERS ELECTRIC COOPERATIVE, A Domestic Not For Profit Cooperative, Defendant/Appellee. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I,ON APPEAL FROM THE DISTRICT COURT OF CHOCTAW COUNTY, STATE OF OKLAHOMA HONORABLE JAMES R. WOLFE, TRIAL JUDGE ¶0 Employee, David Jordan, brought an intentional tort action against his employer, Western Farmers Electric Cooperative, for injury from on-the-job exposure to allegedly highly toxic fly ash. Jordan alleged Western's spread of this hazardous material on the premises was intentional and with knowledge to a substantial certainty that serious injury would occur to employees. Western moved to dismiss for lack of subject matter jurisdiction based on the exclusivity provisions of the Workers' Compensation Act for injuries arising out of and in the course of employment. The trial court found the petition failed to allege facts which plausibly demonstrated Western's conduct was intentional under the then-existent substantial certainty standard. The trial court dismissed the action with prejudice for failure to state claim upon which relief may be granted, and the Court of Civil Appeals affirmed. We granted certiorari to determine whether the petition pled sufficient facts to remove the claim from the exclusive remedy of the Workers' Compensation Act. We hold that the petition sufficiently pled a claim under the intentional tort/substantial certainty exception to the exclusive jurisdiction of the Workers' Compensation Court. The order of dismissal is reversed and this case is remanded for further proceedings. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; JUDGMENT OF THE TRIAL COURT REVERSED AND REMANDED WITH INSTRUCTIONS. Jerry L. McCombs, JERRY L.. MCCOMBS, P.C., Idabel, Oklahoma for Plaintiff/Appellant,Rachel R. Shephard, Douglas A. Rice, DERRYBERRY & NAIFEH, LLP, Oklahoma City, Oklahoma, for Defendant/Appellee. REIF, J.: ¶1 The issue presented on certiorari review is whether an employee in district court pled sufficient facts to plausibly demonstrate that employer's conduct was intentional under the substantial certainty standard, removing the claim from the exclusive remedy of the Workers' Compensation Act. We hold that the employee's petition was sufficient to withstand the employer's dismissal motion. Accordingly, we reverse the trial court's dismissal of the employee's action, and remand the case for further proceedings in the district court. ¶2 David Jordan brought suit in district court against his employer, Western Farmers Electric Cooperative. Jordan claimed that Western disposed of highly toxic fly ash, a by-product of the company's operations, in ponds created for that purpose until 2002. Then, Western began spreading the ash on the plant's roads and parking lots. Jordan states that his on-the-job exposure to the highly toxic fly ash caused him injury, and that he suffered pain, impairment, and lost income as a result. Jordan asserted that Western's conduct amounted to an intentional tort. ¶3 Western argued that Jordan's claim did not meet the standard an intentional tort under the substantial certainty test set out in Parret v. UNICCO Service Co., 2005 OK 54 ¶ 26, 127 P.3d 572, 579, and that as a result, the Worker's Compensation Court had exclusive jurisdiction. The trial court dismissed the case with prejudice under 12 O.S. § 2012(B)(1) for failure to state a claim upon which relief may be granted. Jordan appealed, and the Court of Civil Appeals affirmed, holding Jordan failed to allege facts which plausibly demonstrated Western's conduct was intentional under the substantial certainty standard. ¶4 Jordan filed a petition for certiorari. His chief complaint was that the trial court and Court of Civil Appeals erred in concluding "[the petition] failed to allege facts which plausibly demonstrate that Defendant's conduct was intentional under the substantial certainty standard."1 This Court previously granted certiorari to determine the sufficiency of the petition to state a claim for intentional tort under the former substantial certainty standard. ¶5 Review of the trial court's dismissal for failure to state a claim upon which relief may be granted presents a question of law as to whether the petition is legally sufficient. Hayes v. Eateries, Inc., 1995 OK 108, ¶ 2, 905 P.2d 778, 780. This Court reviews questions of law de novo. Id. When reviewing such a dismissal, "an appellate court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them." Great Plains Federal Savings and Loan Association v. Dabney, 1993 OK 4, ¶ 2 n.3, 846 P.2d 1088, 1090. "A pleading must not be dismissed for failure to state a legally cognizable claim unless the allegations indicate beyond any doubt that the litigant can prove no set of facts which would entitle him to relief." Frazier v. Bryan Memorial Hospital Authority, 1989 OK 73, ¶ 13, 775 P.2d 281, 287. ¶6 Upon review, this Court finds that the Court of Civil Appeals erred in affirming the trial court's dismissal, because Jordan alleged sufficient facts under the substantial certainty standard set forth in Parret, 2005 OK 54 at ¶¶ 23-26, 127 P.3d at 578-79. Jordan's claim is controlled by 85 O.S. 2001 § 11 and 85 O.S. Supp. 2005 § 12, the liability provisions in effect at the time his claim accrued in August of 2009. OKLA. CONST. Art. V, § 54. These provisions,2 that the Workers' Compensation Act provides exclusive liability in place of all other liability of the employer for accidental personal injury incurred by an employee during the scope of employment. ¶7 In Parret, this Court recognized an exception to the exclusive remedy of Workers' Compensation in cases where the employee's injury is not accidental, but results from an intentional tort. Parret, 2005 OK 54, ¶¶ 23-27, 127 P.3d at 578-79. According to Parret, "in order for an employer's conduct to amount to an intentional tort, the employer must have (1) desired to bring about the worker's injury or (2) acted with the knowledge that such injury was substantially certain to result from the employer's conduct." Id. ¶ 24, 127 P.3d at 579. Although the sufficiency of the plaintiff's complaint was not at issue in Parret, this Court did address the necessary allegations to maintain a tort claim in district court. "The worker must allege facts which 'plausibly demonstrate' that the employer's conduct was intentional under the 'substantial certainty' standard." Id. ¶ 26, 127 P.3d at 579. Jordan met this heightened pleading requirement in his complaint. ¶8 Jordan's pleading sufficiently alleged facts under the substantial certainty standard because a trier of facts could reasonably infer from the allegations that Western acted with substantial certainty. A pleading must not be dismissed "unless the allegations indicate beyond any doubt that the litigant can prove no set of facts which would entitle him to relief." Hayes, 1995 OK 108, ¶ 2, 905 P.2d at 780 (quoting Frazier v. Bryan Memorial Hospital Authority, 1989 OK 73, ¶ 13, 775 P.2d 281, 287). Moreover, "the court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them." Hayes, 1995 OK 108, ¶ 2, 905 P.2d at 780. ¶9 As noted, in Parret this Court specifically addressed the requirements of allegations in order to remove a claim from the exclusive remedy of Workers' Compensation. Parret, 2005 OK 54, ¶ 26, 127 P.3d at 579. A worker "must allege facts which 'plausibly demonstrate' that the employer's conduct was intentional under the 'substantial certainty' standard." Id. Substantial certainty, as defined by Parret, is found when an employer intended the act that caused the injury with knowledge that the injury was substantially certain to follow. Id. ¶ 24, 127 P.3d at 579. This Court further clarified substantial certainty by stating, "an employer's knowledge may be inferred from the employer's conduct and all the surrounding circumstances." Id. ¶10 The substantial certainty requirement was further refined in Price v. Howard, where the court stated that, "nothing short of a demonstration of the employer's knowledge of the substantial certainty of injury will suffice" to remove a claim from the exclusive remedy of Workers' Compensation. 2010 OK 26, ¶ 10, 236 P.3d 82, 88. In Price, a woman brought suit after her husband died while traveling in a corporate airplane during a business trip. Id. ¶ 3, 236 P.3d at 86. However, the claim in Price was not dismissed for failure to state a claim upon which relief may be granted, but rather because the plaintiff failed to demonstrate employer's knowledge on a motion for summary judgment. Id. ¶¶ 5-6, 236 P.3d at 86-87. ¶11 To determine whether Jordan's complaint sufficiently alleged facts, this Court must determine whether the allegations, when taken as true and all reasonable inferences drawn from them, "plausibly demonstrate" that Western acted with knowledge that Jordan's injury was substantially certain to follow.3 Jordan alleged that Western disposed of toxic fly ash in ponds created for that purpose until 2002, when Western began spreading the ash on the plant's roads and parking lots. Jordan alleged Western acted with knowledge that there was substantial certainty serious death or injury would occur to its employees as a result. Jordan further alleged that he was injured as a result of this exposure and that he complained to Western in 2009. If all of these allegations are taken as true, a trier of facts could reasonably infer that Western disposed of the fly ash in ponds due to its toxicity and was aware of the potential for injury. Without further discovery regarding the toxicity of the fly ash, Jordan's case cannot be dismissed for failure to meet the substantial certainty standard. ¶12 In analyzing Jordan's petition, we are cognizant that "the use of the word 'intent' in allegations 'is not a talisman that can change the allegations into colorable claims.'"4 However, this is not the sole basis of Jordan's claim. In addition to alleging Western's intent, Jordan also alleges facts and circumstances from which Western's knowledge may be inferred, including the allegation that Western altered its disposal methods of what it allegedly knew to be toxic ash. A reasonable inference may be drawn from the totality of Jordan's allegations to satisfy Jordan's burden to plausibly demonstrate that Western acted with knowledge of the substantial certainty of an injurious effect of the fly ash. Under these circumstances, the trial court erred in dismissing the case for failure to state a claim upon which relief may be granted. ¶13 In conclusion, we hold that if all allegations in Jordan's petition are taken as true, and all reasonable inferences drawn from them, the petition plausibly demonstrates that Western's actions constituted an intentional tort under the substantial certainty standard, which was the law in effect at the time of his injury in August of 2009. The trial court's dismissal of Jordan's claim for failure to state a claim upon which relief may be granted is reversed and the matter is remanded to district court for further proceedings. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; JUDGMENT OF THE TRIAL COURT REVERSED AND REMANDED WITH INSTRUCTIONS. ¶14 COLBERT, V.C.J., WATT, EDMONDSON, REIF, and COMBS, JJ., concur. ¶15 KAUGER, J., concurs specially. ¶16 TAYLOR, C.J., WINCHESTER, and GURICH, JJ., dissent. TAYLOR, C.J., dissenting. The trial judge and the unanimous Court of Civil Appeals were absolutely correct in their disposition of this meritless lawsuit. This Court spoke clearly in Parret and Price that the Workers' Compensation Court has exclusive jurisdiction except in the case of an intentional tort in which the employer had willful, deliberate and specific intent ("a desire") to cause injury to an employee or the employer acted with knowledge that injury to the employee was substantially certain. In Price, this Court referred to this standard as a "formidable barrier" and held that "nothing short" of that standard will suffice. The record in this case shows that the employer in this case did not intend, plan, desire or have a substantially certain knowledge and plan to injure this employee. The employer did not intend or plan to injure this employee. This is a frivolous claim in district court and the trial court's dismissal should be affirmed. FOOTNOTES 1 Jordan's petition for certiorari also contended the dismissal with prejudice was error. Our decision on the substance of the claim makes it unnecessary to address this issue. See Brown v. Founders Bank and Trust Co., 1994 OK 130, ¶ 9, 890 P.2d 855, 861. 2 Title 85 O.S. 2001 § 11 provides: A. Every employer subject to the provisions of the Workers' Compensation Act shall pay, or provide as required by the Workers' Compensation Act, compensation according to the schedules of the Workers' Compensation Act for the disability or death of an employee resulting from an accidental personal injury sustained by the employee arising out of and in the course of employment, without regard to fault as a cause of such injury, . . . (emphasis added) with exceptions for certain conduct by employees. The exclusivity provision is set out in section 12, as follows: The liability prescribed in Section 11 of this title shall be exclusive and in place of all other liability of the employer and of his employees, any architect, professional engineer, or land surveyor retained to perform professional services on a construction project, at common law or otherwise, for such injury, loss of services, or death, to the employee, . . . . 85 O.S 2001 § 11 and 85 O.S. Supp. 2005 § 12 were amended in 2010 and repealed in 2011. In their place, 85 O.S. 2011 § 302 was enacted, providing in part: A. The liability prescribed in this act shall be exclusive and in place of all other liability of the employer and any of his or her employees, at common or otherwise, for such injury, loss of services, or death, to the employee, . . . except in the case of an intentional tort . . . . B. An intentional tort shall exist only when the employee is injured as a result of willful, deliberate, specific intent of the employer to cause such injury. Allegations or proof that the employer had knowledge that such injury was substantially certain to result from the employer's conduct shall not constitute an intentional tort. The issue of whether an act is an intentional tort shall be a question of law for the Court. Because liability for on the job injuries is governed by the law in effect at the time of the injury, Jordan's claim is governed by sections 11 and 12, including the exception from exclusivity for an employer's intentional torts, as set forth in Parret, 2005 OK 54, ¶¶ 23-27, 127 P.3d at 578-79, and not section 302, enacted after Jordan's injury. 3 Parret, 2005 OK 54 ¶ 24, 127 P.3d at 579; see also Hayes, 1995 OK 108, ¶ 2, 905 P.2d at 780. 4 Parret, 2005 OK 54 ¶ 26, 127 P.3d at 579 (quoting Mingachos v. CBS, Inc., 196 Conn. 91, 491 A.2d 368, 375 (1985)). KAUGER, J., with whom Watt, Combs, JJ., join, concurring specially: ¶1 I concur with remanding the case and that this proceeding is governed by the holding of Parret v. Unicco Services Co., 2005 OK 54, ¶24, 127 P.3d 572. I write separately to explain why, when the Legislature makes a statutory change, immediate, instantaneous gratification of the change does not always occur. Sometimes patience is required. ¶2 Unless the Legislature clearly expresses a contrary intent, the general rule is that new statutes or statutory changes operate prospectively.1 In workers compensation proceedings, the right of an employee to compensation derives from the contractual relationship between the employee and employer at the time of the injury.2 The statutes which are in effect on the date of injury dictate the substantive rights and obligations of the employee and employer.3 This is so because the statutes then in force form a part of the contract and determine the substantive rights and obligations of the parties.4 Unlike purely procedural amendments, a subsequent amendment to those statutes which affects substantive rights cannot operate retroactively to change fixed rights and obligations.5 ¶3 What does all of this mean? It means that when a case like Parret, supra, is decided, its holding will apply to those cases which occur after it. It was decided on June 28, 2005. Nearly two years later, a lawsuit was filed in the case of Price v. Howard, 2010 OK 26, ¶17, 236 P.3d 82. Because the death of the employee in Price occurred on October 15, 2006, and the lawsuit was filed on May 29, 2007, the law expressed in Parret, supra, applied to the Price litigation. ¶4 On August 27, 2010, the Legislative amendment to the Oklahoma Workers' Compensation Act explicitly overruled Parret, by repealing an employee's ability to bring an intentional tort claim under the substantial certainty standard.6 When this Legislative change occurred, there may have been employees who were injured and/or cases which were filed between the time Parret, supra, was decided and the time the Legislature changed the law. ¶5 Because the Okla. Const., art. 5 §54 expressly prohibits the Legislature from applying a change in the law after court proceedings have begun, those cases which were filed after Parret, but in which the injury had occurred before the Legislative change, were governed by Parret's holding, rather than the new Legislative amendment.7 Why? Because once a right has accrued and a court proceeding has started under particular statutes in effect at that time, that right is not removed if the Legislature repeals or changes the statutes. This is true as long as the right is a substantive right, protected by the Oklahoma Constitution and not merely a procedural change that has no real effect on an employee's protected rights.8 ¶6 Here, Jordan's claim arose when his injury was discovered in August of 2009, and he brought suit on April 20, 2010. At that time, Parret had already been decided and was the current law. Consequently, even though the Legislature changed the law in August of 2010, and Jordan's appeal is not decided until today, Parret applies to his case and not the 2010 statutory change. Otherwise, the Court would expressly violate the Oklahoma Constitution -- the same Constitution we have sworn to uphold. ¶7 Soon, the few cases in the pipeline, if any, will be decided and any backlog of lawsuits begun before the August 2010 Legislative change will be exhausted. At that point, Parret, supra, will be inapplicable and the 2010 Legislative changes will control. FOOTNOTES 1 Forest Oil Corp. v. Corp. Comm'n of Oklahoma, 1990 OK 58, ¶11, 807 P.2d 774. 2 King Mfg. v. Meadows, 2005 OK 78, ¶11, 127 P.3d 584. 3 King Mfg. v. Meadows, see note 2, supra. See, Knott v. Halliburton Services, 1998 OK 29, ¶4, 752 P.2d 812; Batt v. Special Indemnity Fund, 1993 OK 163, ¶9, 865 P.2d 1244; Leeway Motor Freight, Inc. v. Wilson, 1980 OK 48, ¶7, 609 P.2d 777. 4 King Mfg. v. Meadows, see note 3, supra; Knott v. Halliburton Services, see note 3, supra; Leeway Motor Freight, Inc., v. Wilson, see note 3, supra at ¶8; Magnolia Petroleum v. Watkins, 1936 OK 372, ¶5, 57 P.2d 622. 5 King Mfg. v. Meadows, see note 2, supra; Batt v. Special Indemnity Fund, see note 3, supra; Knott v. Halliburton Services, see note 3, supra; Leeway Motor Freight, Inc. v. Wilson, see note 3, supra. 6 The language of 85 O.S. Supp. 2010 ¶12 was amended effective August 27, 2010, and later repealed, but recodified in 2011 as 85 O.S. 2011 §302. It provides in pertinent part: A. The liability prescribed in this act shall be exclusive and in place of all other liability of the employer and any of his or her employees, at common law or otherwise, for such injury, loss of services, or death, to the employee, or the spouse, personal representative, parents, or dependents of the employee, or any other person, except in the case of an intentional tort, or where the employer has failed to secure the payment of compensation for the injured employee. B. An intentional tort shall exist only when the employee is injured as a result of willful, deliberate, specific intent of the employer to cause such injury. Allegations or proof that the employer had knowledge that such injury was substantially certain to result from the employer's conduct shall not constitute an intentional tort. The issue of whether an act is an intentional tort shall be a question of law for the Court. . . . 7 The Okla. Const. Art. 5 §54 provides: The repeal of a statute shall not revive a statute previously repealed by such statute, nor shall such repeal affect any accrued right, or penalty incurred, or proceedings begun by virtue of such repealed statute. 8 We explained in King Mfg. v. Meadows, see note 2, supra at ¶19 that: The terms of the Okla. Const., art. 5, §54 protect matured rights from the effects of after-enacted legislative change. After-enacted legislation that increases or diminishes the amount of recoverable compensation or alters the elements of the claim or defense by imposition of new conditions affects the parties' substantive rights and liabilities. The statute in effect at the time of the initial injury governs a claimant's award of permanent disability for a change in condition. (Citations omitted.)

258e7269-25cc-455e-b4b3-8f82ad914252

Manchester v. Arvest Bank

oklahoma

Oklahoma Supreme Court

MANCHESTER v. ARVEST BANK2012 OK 86Case Number: 109566Decided: 10/16/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. IN RE: JENNIFER LYNN JACKSON, Debtor. SUSAN MANCHESTER, Trustee, Plaintiff, v. ARVEST BANK, Defendant. CERTIFIED QUESTION OF LAW FROM THE UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF OKLAHOMA, THE HONORABLE T.M. WEAVER, JUDGE ¶0 The United States Bankruptcy Court for the Western District of Oklahoma certified the following question provided by the Uniform Certification of Questions of Law Act, 20 O.S.2011, § 1601 et. seq.: "May a certificate of title for a vehicle issued by the Oklahoma Tax Commission be deemed to have been 'properly issued', within the meaning of OKLA. STAT. tit. 47 § 1110.A.1, even though the vehicle is not one for which a certificate of title is required as proof of ownership under applicable Oklahoma law including, without limitation, § 1105.B.?" QUESTION REFORMULATED AND ANSWERED Susan Manchester, Oklahoma City, Oklahoma, for plaintiff. Lyle R. Nelson, Nicholas A. Johnson, ELIAS, BROOKS, BROWN & NELSON, P.C., Oklahoma City, Oklahoma, for defendant. WINCHESTER, J. ¶1 The United States Bankruptcy Court for the Western District of Oklahoma certified a question of law pursuant to 20 O.S. 2011, § 1601 et. seq. The question presented is: "May a certificate of title for a vehicle issued by the Oklahoma Tax Commission be deemed to have been 'properly issued', within the meaning of OKLA. STAT. tit. 47 § 1110.A.1, even though the vehicle is not one for which a certificate of title is required as proof of ownership under applicable Oklahoma law including, without limitation, § 1105.B.?" ¶2 The focus of this dispute is a horse trailer. We do not believe that answering the question as formulated by the Bankruptcy Court, of whether the certificate of title was "properly issued" settles the underlying issue of whether the bank has properly perfected its security interest in this horse trailer. Pursuant to 20 O.S. 2011, § 1602.1, this Court will reformulate the question to read as follows: "Does the filing of a UCC-1 financing statement for a personal/recreational use horse trailer perfect the creditor's security interest where the Oklahoma Tax Commission has issued a discretionary certificate of title, and the creditor is not named on the title?" I. FACTS ¶3 On July 24, 2003, Jennifer Lynn Jackson, the debtor, purchased a horse trailer for personal use with the proceeds of a purchase-money loan from Arvest Bank, the defendant. On July 28, 2003, the Oklahoma Tax Commission issued to the debtor a certificate of title for the trailer. The bank filed a UCC-1 financing statement for the collateral on July 30, 2003, and a UCC continuation statement in 2008. ¶4 The focus of this case is the issuance of title by the Oklahoma Tax Commission to Jackson and the title's implications on the perfection of the bank's security interest in the trailer. That security interest was not recorded on the face of the certificate of title, nor did the bank take steps to record the security interest as provided in 47 O.S.2011, § 1110(A)(1). The debtor did not request that a title be issued. The manufacturer of the trailer had forwarded a statement of origin to an Oklahoma tag agent, who then issued the title. ¶5 Susan Manchester, as the trustee of record, seeks to avoid a perfected security interest by the bank in the trailer. She asserts that because title was issued and the lien was not noted on the title, the bank did not perfect its security interest and does not have a priority position in the bankruptcy proceeding. II. DISCUSSION A. Type of Collateral ¶6 The facts in the Bankruptcy Court's Order Requesting Answer to Certified Question reveal that the trailer in this case is a horse trailer with a dressing room.1 The trustee asserts that this horse trailer is within the 47 O.S. 2011, § 1102(35) definition of a "travel trailer" because, among other requirements, the trailer includes "a dressing room and a berth, which can be used as temporary living/sleeping quarters." The trustee asserts that such a "dressing room" implies that this vehicle contains a living space and is thus a travel trailer. Classifications as a travel trailer would require title to be issued. ¶7 Section 1102(35) includes within the definition that such a vehicle be used as a "temporary dwelling for travel." The meager features of this trailer simply do not meet this baseline requirement. While the trailer does include a "dressing room," we hold that having such a compartment in a horse trailer is not likely to have been within the contemplation of the legislature in its choice of the words "temporary dwelling," which is an element required by § 1102(35). ¶8 The final inquiry requires a determination of the word vehicle as used throughout Title 47. The overarching definition is provided in Title 47 O.S. 2012 §1102(40), and provides that a vehicle is "any type of conveyance […] upon or by which a person or property is or may be transported […]. Vehicle does not include bicycles, trailers except travel trailers and rental trailers, or implements of husbandry […]." We have already decided this horse trailer is not a travel trailer. There is nothing in the facts to indicate it is a rental trailer. ¶9 The trustee asserts that 47 O.S.2011, § 1110(A)(1) gives a contrary definition for vehicle by providing that "For the purposes of this section, the term 'vehicle' shall not include special mobilized machinery, machinery used in highway construction or road material construction and rubber-tired road construction vehicles including rubber-tired cranes." We conclude that this is not a contrary definition, but rather is a supplement to the general definition stated above. ¶10 The primary object of statutory construction is to determine the legislative intent. " That intent is ascertained from the whole act in the light of the general purpose and object." Midwest City v. Harris, 1977 OK 7, ¶ 6, 561 P.2d 1357, 1358. The terms "shall not include" found in § 1110(A)(1) do not replace the general definition in § 1102(40); they add to the definition for purposes of § 1110. As such, we find that because of the exclusions presented in the general definition, that a vehicle is not a travel trailer nor rental trailer, this personal use trailer is excluded from the definition of vehicle for the purpose of requiring title. ¶11 After consideration of the various definitions reviewed, this Court finds that the trailer in question is not a vehicle for the purposes of requiring title and registration within the State of Oklahoma. B. Title Requirement and Optional Title ¶12 Oklahoma law requires that all vehicles within the state must be registered and titled. Title 47 O.S.2011, § 1110(A)(1) provides in pertinent part that: "a security interest in a vehicle as to which a certificate of title may be properly issued by the Oklahoma Tax Commission shall be perfected only when a lien entry form, and the existing certificate of title, if any, or application for a certificate of title and manufacturer's certificate of origin containing the name and address of the secured party and the date of the security agreement and the required fee are delivered to the Tax Commission or to a motor license agent." (emphasis added) ¶13 This Court has determined that this horse trailer does not meet the definitional requirements to be considered a vehicle, and thus is not required to be titled. Furthermore, 47 O.S.2011, § 1105(B)2 does not impose a requirement of title on such a trailer, because this section also applies only to a "vehicle" as defined by the act. The trailer in this specific situation does not meet the definitional requirements of a vehicle, therefore the proper place for a security interest to be perfected would be by the filing of a UCC-1 financing statement as provided by Article 9, Secured Transactions, codified at 12A O.S.2011, § 1-9-101 et. seq. ¶14 Perfection of a security interest by placement of notice on a title would be proper only in cases when the collateral meets the definitional requirements of "vehicle" provided in the Oklahoma Vehicle License and Registration Act, 47 O.S.2011, § 1101, et seq. Correct determination of placement of a security interest must focus on the type of collateral at issue, even though optional title may be available. In re Ramco Well Service, Inc., 32 B.R. 525, ¶ 17, (Bankr. W.D. Okla. 1981). ¶15 The trustee cites Union Bank of Tucson, Arizona v. Griffin, 1989 OK 47, 771 P.2d 219 for the rule that the statute regarding perfection of a security interest contemplates proper issuance of an Oklahoma certificate of title before perfection can be accomplished, and the title may be properly issued when a fully completed application is submitted and reviewed by the tag agent, who is the duly authorized representative of the Tax Commission. However, this case is distinguishable on its facts because the vehicle was a 1979 Ford pickup, not a horse trailer. The trustee implies that when the Tax Commission determines that a certificate of title was properly issued, even if optional, the title is properly issued pursuant to Oklahoma law. However, such a presumption is not accurate. In the last paragraph of the Griffin case the Court reveals a trier of fact may determine that a tag agent was negligent in issuing a clean Oklahoma certificate of title. Griffin, 1989 OK 47, ¶ 22, 771 P.2d at 223. This case is not only distinguishable on its facts, the law found within the case also contradicts the asserted rule provided by the trustee. C. UCC Purpose ¶16 The allowance for owners to seek title to property that is not required to be titled, but still allowable, cannot have commercially impracticable results. Creditors and debtors alike enjoy the certainty that is afforded to them by the structure and steadfast interpretation of the laws. A holding different than ours would have serious ramifications for future business transactions. Lenders would be unreasonably burdened to ensure that all collateral presented was monitored on a regular basis to ensure that no title had been issued, triggering a further action by the lender. A lender should not be forced to constantly monitor situations that may possibly occur at the whims of debtors. To allow for such a theory to exist would frustrate commercial transactions, have a chilling effect on lending, and could possibly induce fraud. ¶17 The promulgation of the Uniform Commercial Code as adopted and codified in Oklahoma in title 12A is designed to provide for commercial reasonableness and certainty within the law. The mandate by the legislature as provided in 12A O.S.2011 § 1-103(a) is that "The Uniform Commercial Code shall be liberally construed and applied to promote its underlying purposes and policies, which are: (1) to simplify, clarify and modernize the law governing commercial transactions;(2) to permit the continued expansion of commercial practices through custom, usage and agreement of the parties; and (3) to make uniform the law among the various jurisdictions." This directive indicates that in this case it would be unreasonable and would place undue burdens on lenders to monitor situations that at best may possibly occur. These burdens are contrary to the purpose and scheme of the Uniform Commercial Code in promoting the ease of business transactions. III. CONCLUSION ¶18 The modified certified question presented by the United States Bankruptcy Court for the Western District of Oklahoma is answered with specific explanations relevant to the case at bar. Title may be properly issued by the Oklahoma Tax Commission to non-required trailers for the convenience of showing ownership. The use of title beyond this single purpose for non-required vehicles would be contrary to the general scheme and purposes of the Uniform Commercial Code as adopted in Oklahoma. The proper method for perfecting a security interest in collateral that is not required to be titled (but may be titled at the discretion of the owner) still is, and has been by the filing of a UCC-1 financing statement. QUESTION REFORMULATED AND ANSWERED. CONCUR: TAYLOR, C.J., COLBERT, V.C.J., WINCHESTER, EDMONDSON, REIF, COMBS, JJ. CONCUR IN RESULT: KAUGER, GURICH, JJ. CONCURS IN PART; DISSENTS IN PART: WATT, J. FOOTNOTES 1 Fact 2, p. 2, Order Requesting Answer to Certified Question 2 47 O.S.2011, § 1105(B) provides in part: ".The owner of every vehicle in this state shall possess a certificate of title as proof of ownership of such vehicle, except those vehicles registered pursuant to Section 1120 of this title and trailers registered pursuant to Section 1133 of this title, previously titled by anyone in another state and engaged in interstate commerce, and except as provided in subsection M of this section. . . ."

6605390b-8e99-4a2f-8da2-f0f8d06ce8db

KWD River City Investments, LP v. Ross Dress for Less, Inc.

oklahoma

Oklahoma Supreme Court

KWD RIVER CITY INVESTMENTS, L.P. v. ROSS DRESS FOR LESS, INC.2012 OK 76Case Number: 109176Decided: 09/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. KWD RIVER CITY INVESTMENTS, L.P., an Oklahoma Limited Partnership, Teresa Morris, Plaintiff/Appellee, v. ROSS DRESS FOR LESS, INC., a Virginia Corporation, Defendant/Appellant. CERTIORARI TO THE OKLAHOMA COURT OF CIVIL APPEALS, DIVISION I, ON APPEAL FROM THE DISTRICT COURT OF MUSKOGEE COUNTY HONORABLE MIKE NORMAN, TRIAL JUDGE ¶0 Landlord filed declaratory judgment action in district court to resolve dispute with shopping center tenant over a provision in the parties' lease. Tenant filed a motion to compel arbitration. The trial court denied the motion to compel arbitration. On appeal taken by tenant, the Court of Civil Appeals reversed. Landlord has petitioned this Court to grant certiorari and review the opinion of the Court of Civil Appeals. We have previously granted the petition for certiorari. Upon review, we vacate the Court of Civil Appeals opinion and affirm the trial court's denial of the motion to compel arbitration. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; TRIAL COURT'S DENIAL OF MOTION TO COMPEL ARBITRATION AFFIRMED. Betty Outhier Williams, BETTY OUTHIER WILLIAMS LAW OFFICE, Muskogee, Oklahoma, for Plaintiff/Appellee, Anton J. Rupert, CROWE & DUNLEVY, Oklahoma City, Oklahoma, for Defendant/Appellant. REIF, J.: ¶1 The issue in this case is whether the parties' dispute over a provision in their lease for a shopping center store must be resolved under the arbitration provision in the lease or can be resolved by a proceeding in district court. The disputed provision provides that landlord KWD would not alter the exterior of the shopping center without the consent of tenant Ross Dress for Less. KWD admits that it allowed another tenant to alter the shopping center's exterior at that tenant's store location without Ross' consent. However, KWD has maintained that Ross unreasonably withheld its consent in violation of the consent provision. KWD contends that the unreasonableness of Ross' refusal to consent is demonstrated by Ross conditioning its consent upon KWD making exterior alterations to benefit Ross. ¶2 KWD filed an action in district court to resolve this dispute. Ross filed a motion to compel arbitration. The trial court denied the motion to compel arbitration. On appeal taken by Ross, the Court of Civil Appeals reversed, ruling that the parties' dispute was subject to arbitration. The Court of Civil Appeals noted that Ross was alleging breach of contract, was claiming damages in the amount of $50,000 and the arbitration provision expressly applied to claims that were $50,000 or less. On certiorari to this Court, KWD argues that the Court of Civil Appeals erred in this analysis, because Ross suffered no damages as a result of KWD (1) allowing the other tenant to change the shopping center exterior at its store location and (2) refusing the additional benefits demanded by Ross as a condition of its consent. KWD asserts that the only remedy Ross is entitled to receive (if allowing the exterior's alteration without Ross' consent is found to constitute a breach) is an equitable remedy to return the shopping center exterior to the status quo. KWD points out that disputes involving equitable remedies are expressly excluded from the arbitration provision. ¶3 The "question of arbitrability" is one for the courts to decide. Oklahoma Oncology & Hematology P.C. v. US Oncology, Inc., 2007 OK 12, ¶ 25, 160 P.3d 936, 946. Courts will enforce arbitration agreements according to the terms of the parties contract and will not impose arbitration upon parties where they have not agreed to do so. Id., ¶ 22, 160 P.3d at 944. Before ordering arbitration, the court must determine whether the parties agreed to submit a particular dispute to arbitration. Id., ¶ 22, 160 P.3d at 945. Such determinations are reviewed de novo. Id., ¶ 19, 160 P.3d at 944. Upon de novo review, we agree with KWD, vacate the Court of Civil Appeals opinion and affirm the trial court's denial of the motion to compel arbitration. ¶4 The demands that Ross made as a condition on its consent for another tenant to alter the shopping center exterior involved benefits that were not otherwise provided for in the parties' contract. Ross' demands (to paint exterior accents at Ross' store location and to add a second panel on the shopping center pylon sign) were nothing more than requests to modify the parties' lease. KWD was free to reject such modification of the lease. KWD's act of allowing the exterior change without agreeing to such modification created no right on the part of Ross to recover the value of these improvements as "damages." ¶5 While a party may seek relief in order to receive the agreed benefits created by the contract, such relief is not necessarily monetary damages. The only right or benefit that Ross received under the consent provision is for the exterior to remain unchanged until it consents to proposed alterations. However, Ross forfeits such right or benefit if its consent is unreasonably withheld. Stated another way, Ross' consent is unnecessary as a condition to exterior alterations whenever it is unreasonably withheld. ¶6 If the court determines that Ross did not unreasonably withhold its consent, Ross' relief or remedy is an order compelling KWD to restore the exterior's status quo. If the court determines that Ross did unreasonably withhold its consent, KWD is entitled to a judgment declaring such fact as well as a judgment prohibiting Ross from interfering with the change in the shopping center's exterior at the other tenant's store location. The relief by which each party can receive their respective benefit under the consent provision is purely equitable and disputes involving equitable remedies are excluded from arbitration by the express terms of the arbitration provision. ¶7 Based on the foregoing, we hold the Court of Civil Appeals erred in its construction of the parties lease, in its analysis of the parties claims and in ordering arbitration contrary to the terms of the arbitration agreement. Accordingly, we vacate the opinion of the Court of Civil Appeals and affirm the trial court's denial of Ross' motion to compel arbitration. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; TRIAL COURT'S DENIAL OF MOTION TO COMPEL ARBITRATION AFFIRMED. ¶8 TAYLOR, C.J., COLBERT, V.C.J., WATT, EDMONDSON, REIF, COMBS, and GURICH, JJ., concur. ¶9 KAUGER, J., concur in part; dissent in part. ¶10 WINCHESTER, J., dissent.

f38836ce-a69d-4d22-8b5b-ec582ec43b60

Williams Companies, Inc v. Dunklegod

oklahoma

Oklahoma Supreme Court

WILLIAMS COMPANIES, INC. v. DUNKELGOD2012 OK 96Case Number: 108990Decided: 11/20/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. WILLIAMS COMPANIES, INC., (Own Risk), Petitioner,v.KRISTY DUNKELGOD and THE WORKERS' COMPENSATION COURT, Respondents. PROCEEDING TO REVIEW AN ORDER OF A THREE-JUDGE PANEL OF THE WORKERS' COMPENSATION COURT ¶0 Workers' compensation claimant Kristy Dunkelgod was injured in an employment-related accident on June 11, 2001, while working for Williams Companies, Inc. The Workers' Compensation Court entered several orders awarding claimant temporary total disability benefits. She was also awarded a "Go-Go" scooter and a lift van. On appeal by the employer, the Court of Civil Appeals, Division III, vacated the awards, holding the court's finding the lift van was medically necessary was "against the clear weight of the evidence." The Court of Civil Appeals also held the claimant was limited to a maximum of 300 weeks of temporary total disability benefits and remanded for a determination of when she reached the maximum. This Court previously granted certiorari. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III; COURT OF CIVIL APPEALS' OPINION IS VACATED; WORKERS' COMPENSATION COURT'S ORDER IS SUSTAINED AND REMANDED FOR FURTHER PROCEEDINGS Karen McGivern Curthoys, Tulsa, Oklahoma, for Petitioner,Victor R. Owens, Tulsa, Oklahoma, for Respondents. OPINION WATT, J.: ¶1 In this matter on certiorari, we address two issues: 1. Did the Court of Civil Appeals (COCA) err when it applied the "clear weight of the evidence" standard of review to the Workers' Compensation Court's order awarding a lift van? 2. Did COCA err when it held that Claimant's temporary total disability (TTD) award was limited to a maximum of 300 weeks? We answer both questions in the affirmative. COCA failed to apply the law in effect at the time of Claimant's injury. We vacate and remand to the Workers' Compensation Court for further proceedings. FACTS AND PROCEDURAL BACKGROUND ¶2 Kristy Dunkelgod (Claimant or Dunkelgod) was injured on June 11, 2001, while working for Petitioner Williams Companies, Inc. (Employer) in Tulsa, Oklahoma. On her Form 3, she alleged a single incident injury to her back, with psychological overlay, which occurred while she was "lifting moving boxes all day." She also reserved all body parts. She later amended her Form 3 to add an injury of "consequential bowel/rectal distress" and again reserved all body parts. The trial court awarded TTD benefits on July 15, 2004, for injury to the lumbar back, and reserved the issues of "resulting psychological overlay and consequential injury in the form of bowel/rectal distress" for future hearing. The court found she had been, and continued to be, temporarily totally disabled since her injury and was "in need of further medical treatment, care and attention. . . ." Employer's request to terminate benefits was denied.1 ¶3 On October 20, 2008, the trial court ordered Employer to reimburse Claimant for a "Go-Go" scooter and a scooter lift for a vehicle. On January 15, 2010, the court ordered Employer to provide a driving evaluation and a van. The court found that Claimant's need for transportation was permanent and that neither leasing a van nor paying for private transportation was cost effective. After Employer appealed, the three judge panel reversed and remanded for consideration as to the "medical necessity" for the van. ¶4 On July 12, 2010, the trial court issued two orders. The court again awarded the van, equipped with lift service for her scooter, based on Dr. C.'s recommendation for transportation assistance to improve "claimant's mobility, independence and ultimate psychological recovery/stability." The order also contained the finding that Claimant's need for transportation was "medically/psychologically necessary." ¶5 The other order issued on July 12, 2010 directed Employer to pay an additional 52 weeks of TTD benefits and to provide treatment, including back surgery at "L2-3", a thoracic spine MRI, and epidural steroid injections in the lumbar spine and hip. On November 19, 2010, in its Order on Appeal, the panel affirmed the award of the van and additional TTD benefits, as ordered on July 12, 2010.2 ¶6 Employer appealed the three judge panel's order. In a published opinion filed on November 18, 2011, COCA found the law applicable to Claimant's injuries provided a maximum of 300 weeks of TTD benefits. It vacated the panel's order and remanded for a determination of the date on which Claimant had received the maximum benefits. COCA also held the finding that the lift van was a medical necessity was "against the clear weight of the evidence." Claimant filed her petition for certiorari which was granted on February 22, 2012. WHILE A WORKERS' COMPENSATION CLAIM IS PENDING, THE LAW AS IT EXISTED AT THE TIME OF THE INJURY DETERMINESTHE SUBSTANTIVE RIGHTS AND LIABILITIES OF THE PARTIES,DESPITE AN INTERVENING STATUTORY AMENDMENT a. The standard of review, determined on the date of injury, is a substantive right requiring prospectiveapplication. ¶7 Before the 2010 statutory amendment to 85 O.S. §3.6(C), discussed below, or the enactment of the new Workers' Compensation Code (the Code), 85 O.S. 2011, §§301-413 on August 26, 2011, Parks v. Norman Municipal Hosp., 1984 OK 53, 684 P.2d 548, was the landmark case addressing the standard of review in workers' compensation appeals. Appellate court review was limited to questions of law. 85 O.S. 1981 §26.3 Final orders of the Workers' Compensation Court were subject to the traditional "any-competent-evidence test of correctness."4 This was the standard of review at the time of Claimant's injury on June 11, 2001. ¶8 Effective November 1, 2010, 85 O.S. §3.6(C) was amended to provide: The Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds:. . . 4. The order or award was against the clear weight of the evidence. [emphasis added]. ¶9 On March 1, 2011, this Court entered an order in Dunlap v. The Multiple Injury Trust Fund, 2011 OK 14, 249 P.3d 951, acknowledging the amendment of §3.6(C). We stated: The amendment notwithstanding, the Court of Civil Appeals properly applied the "any competent evidence" standard of review in deciding this case because the injury underlying the claim for benefits occurred prior to effective date of the amendment. Knott v. Halliburton, 1988 OK 29, ¶4, 752 P.2d 812, 813-14. The amendment authorizing review of an order or award to determine whether it was against the clear weight of the evidence applies prospectively to claims for injuries that occur after the effective date of the amendment. [emphasis added]. ¶10 We subsequently upheld the rule in Dunlap, supra, in Nomac Drilling LLC v. Mowdy, 2012 OK 45, ¶8, 277 P.3d 1282, 1284: Because Claimant's injury precedes the effective date of the November 1, 2010 amendments to the Workers' Compensation Act, the law at the time of Claimant's injury governs. Thus, the 'any competent evidence' standard applies. See Dunlap v. Multiple Injury Trust Fund, 2011 OK 14, ¶1, 249 P.2d 951, 952. This Court must sustain the Workers' Compensation Court's determination of a fact issue if it is supported by any competent evidence. Parks v Norman Mun. Hosp., 1984 OK 53, ¶12, 684 P.2d 548, 552. ¶11 Dunlap and Nomac, supra, both construe the November 1, 2010 amendment to 85 O.S. §3.6 which provides for the review standard of "against the clear weight of the evidence."5 Now, for the first time, this Court construes 85 O.S. 2011 §340, the new Code section on Appeals. Section 340 contains no provision for using the law in effect at the time of injury. In fact, §340(D) provides for disregarding the law on the date of injury: [A]fter the effective date of this act, regardless of the date of injury, the Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds:. . .4. The order or award was against the clear weight of the evidence. [emphasis added] ¶12 However, the new Code does include a provision at 85 O.S. 2011 §315, similar to §3.6(F) or §3.6(G) in the previous Act: Benefits for a single event injury shall be determined by the law in effect at the time of injury. . . Benefits for death shall be determined by the law in effect at the time of death. [emphasis added] ¶13 Without deciding whether sections 340(D) and 315 are internally inconsistent,6 we consider instead whether the Legislature's obvious intent that the "against the clear weight of the evidence" standard of review must apply in every appeal filed after August 26, 2011, is consistent with our workers' compensation jurisprudence. We hold it is not. ¶14 A cause of action accrues when the plaintiff could have first maintained an action. See gen., Cowart v. Piper Aircraft Corporation, 1983 OK 66, 665 P.2d 315, 318. In workers' compensation cases, the claim accrues on the date of the injury. King Manufacturing v. Meadows, 2005 OK 78, 127 P.3d 584; Independent School District No. 89 v. McReynolds, 1974 OK 136, 528 P.2d 313; Spec. Ind. Fund v. Michaud, 1959 OK 203, 345 P.2d 891; and General Electric Co. v. Folsom, 1958 OK 279; 332 P.2d 950. The date of injury or death also determines the compensation allowed a particular claimant. Independent School District No. 89 v. McReynolds, 1974 OK 136, 528 P.2d 313; Spec. Ind. Fund v. Michaud, supra; and General Electric Co. v. Folsom, supra. The date of injury has long been the point in time in workers' compensation cases when rights of the parties become established, including when a claim must be filed;7 which law to use for determining benefits,8 and a schedule of compensation to determine the amount of benefits a claimant is entitled to receive.9 We stated in King Manufacturing v. Meadows, 127 P.3d at 589: The general rule is that the law in effect at the time of an employee's injury controls in workers' compensation matters. A compensation claim is controlled by the laws in existence at the time of injury and not by laws enacted thereafter. The right of an employee to compensation arises from the contractual relationship existing between the employee and the employer on the date of injury. The statutes then in force form a part of the contract and determine the substantive rights and obligations of the parties. No subsequent amendment can operate retrospectively to affect in any way the rights and obligations which are fixed. [footnotes omitted] [emphasis added]. ¶15 In King, we cited to Cole v. Silverado Foods, Inc., 2003 OK 81, 78 P.3d 542, which addressed the effect of an amendment to 85 O.S. §43(B) decreasing the length of time in which a claimant must request the adjudication of a pending claim. The effect of the amendment in that case was to foreclose the claimant's right to have her claim heard. We held that the amendment of §43(B) in that case was much more than a remedial, procedural action which impacted only the time in which a claim could be brought. Its impact would have destroyed the claimant's substantive right to receive a portion of her unadjudicated "statutorily 'recoverable compensation.'" Cole, ¶12, at 548, citing Magnolia Petroleum Co. v. Watkins, 1936 OK 372, 57 P.2d 622, 623, 177 Okl. 30. Significantly, we also found the statute allows an employer to invoke the same lapse of time to defeat its own statutory liability, i.e., a "liability-defeating defense," for unadjudicated benefits. Cole, ¶11-12, at 547-548. We said: Section 43(B) stands as an employer's liability-defeating defense against an employee's untimely quest for permanent disability's adjudication. A statutory defense constitutes an accrued right. To modify one's defense against a claim changes its character and potency. That change decreases here the time period from five to three years during which an employer may extinguish its liability. Retroactive application of § 43(B) would make the employer's defense much more extensive than it stood at the time the claim was brought. The amendment also affects the merits of Cole's claim. She would have to confront a different defense. Because the amendment refashions § 43(B) into a different and more extensive liability-defeating mechanism, it destroys the claimant's right to present her claim free from being subjected to new and more extensive instruments of destruction. Inasmuch as the amended version of §43(B) operates here on rights in existence, its terms are subject solely to prospective application. [emphasis added]. Cole v. Silverado, ¶13, at 548. ¶16 The Oklahoma Constitution guarantees that any cause of action which has accrued may not be destroyed by the Legislature after the suit has been commenced. Similarly, claims which have become barred, due to the passage of time or by statute, may not be revived by the Legislature. See Okla. Const., Art. 5, §52: Revival of rights or remedies - Taking away cause of action or defense The Legislature shall have no power to revive any right or remedy which may have become barred by lapse of time, or by any statute of this State. After suit has been commenced on any cause of action, the Legislature shall have no power to take away such cause of action, or destroy any existing defense to such suit. [emphasis added]. ¶17 Additionally, accrued rights and proceedings begun pursuant to statute are protected against the repeal of those statutes. See Okla. Const., Art 5, § 54:10 Repeal of statute - Effect The repeal of a statute shall not revive a statute previously repealed by such statute, nor shall such repeal affect any accrued right, or penalty incurred, or proceedings begun by virtue of such repealed statute. ¶18 The standard of review applicable to a workers' compensation appeal is that which is in effect when the claim accrues. It is determined as of the date of injury and is a substantive right which remains unaffected by later-enacted legislation, despite statutory language to the contrary. See Dunlap, Nomac, supra; Okla. Const., Art. 5, §§52, 54. Our constitution protects the accrual of a cause of action so that a person's failure to exercise rights under a statute prior to the statute's repeal does not result in the loss of those rights. Hammons v. Muskogee Medical Center Authority, 1985 OK 22, 697 P.2d 539, 542. Generally, a statute or its amendments will have only prospective effect unless it clearly provides otherwise. Id. While the statute at issue, §340(D), provides that the date of injury is irrelevant, applying this provision as written would allow the unconstitutional abrogation of an accrued right. Hammons, supra, at 542. b. Evidence presented ¶19 COCA held at paragraph 19 of the opinion: [T]he clear weight of the evidence does not show a van is medically necessary. Indeed the record does not include even any competent evidence of medical necessity. [emphasis added].11 ¶20 COCA referred to the medical report of Dr. C.,12 one of Claimant's treating physicians, who opined that a lift van would be appropriate for Claimant's "independence." However, COCA held that his medical opinion was insufficient to prove "medical necessity." The appellate court held that the record does not support the award of a van, stating at ¶19: [D]unkelgod is able to walk and drive, and she has previously been awarded a scooter and a lift to attach to her own vehicle. The record does not show that more equipment of this nature is necessary and we therefore vacate the award of a lift van. ¶21 In support of its holding, COCA distinguished this case with Oklahoma Gas & Electric Co. v. Chronister, 2005 OK CIV APP 32, 114 P.3d 455 (cert. denied), in which a van was awarded to a workers' compensation claimant who could not walk. COCA thus distinguished Chronister because Dunkelgod is not paralyzed. Claimant argues Oklahoma law does not require a finding she is paralyzed in order for a van to be awarded. We agree. This Court has never held that paralysis must be shown to prove "medical necessity" for the award of a vehicle with the necessary equipment. ¶22 COCA also refers to Dr. R.'s January 14, 2010 deposition in which he was asked if Claimant was physically able to drive. He opined that he did not know whether she actually needed a van "as much as a car with a big front door and a big seat to get into. I don't know that she needs a van." When asked if a van would be "medically necessary" he answered he did not know. However, on recross examination, Dr. R. elaborated as to why the scooter, which had been previously ordered by the workers' compensation court, was important for Claimant's recovery, thus making the van necessary. He testified that having the scooter would allow her to get out of the house more, which she would like, and to become more social which would be beneficial to her. When asked if a person in her present condition could go to the zoo and walk all day, he stated, "No. Absolutely not." He was asked if that would be a reason she would need the scooter. He testified: A. I think yes. If going to Philbrook, the zoo, going to BOK, she would be a whole lot better if she had a scooter for faster movement, and then she could get out of it and park it and do some things. But having that, as long as she wasn't dependent on it all the time, would be a benefit for her. Q. Okay. So what you recommend is walk when you can, but if it's going to hurt you go ahead and use the Go-Go scooter? A. That's correct. Q. And in regards to loading and unloading a Go-Go scooter and doing those things you could see where the rationale comes in regards to the lift van now; right? A. Yes, sir. Q. And so far as that may be being reasonable or necessary, you could see under those scenarios where it would be? [emphasis added]. A. Absolutely, yes, sir. ¶23 The record also establishes that Claimant's car is broken down, so a lift attached to an existing vehicle is not an option. Also, Claimant's mother who was previously loading the scooter into a car, has had a double mastectomy and is unable now to assist her. ¶24 Dr. C.'s report indicates that being able to get around with the use of a lift van would make her more independent which would be beneficial to her. Claimant objected to being transported in a van with strangers who may be sick, as she was worried about the spread of germs. She received a favorable driving evaluation, and Dr. R. stated he saw no problem with her driving, because she has learned to tolerate her pain medication. Moreover, the evidence shows the great expense of paying for medical transportation and for leasing a van.13 As to purchasing vans with lifts, evidence was presented of four available 2008 Dodge Grand Caravans ranging in price from $16,900.00 to $17,500.00. The mileage ranged from 15,763 to 27,855 on the four vehicles. ¶25 By its holding, COCA elevated the required level of proof to a higher standard of review than Claimant anticipated when she presented it at trial. Thus, the same evidence, submitted when the "any competent evidence" standard was in effect, was reviewed by COCA under "the clear weight of the evidence" standard because of the statutory amendments. When a claimant's evidence is presented at trial, he or she should know the standard of review by which the evidence will be scrutinized. Evidence which is sufficient to meet the "any competent evidence" test may not suffice under the more demanding "against the clear weight of the evidence" standard. If Claimant had known that her evidence would be considered under a different standard, she may have submitted different evidence at trial. All of the hearings and adjudications in this case occurred before August 26, 2011.14 ¶26 We hold that COCA's review of the award of the van under the "against the clear weight of the evidence" standard destroyed Claimant's right to "benefits," i.e., her "award", of the scooter and the van. Using a more stringent standard of review, COCA found the evidence weighed more heavily in Employer's favor as to "medical necessity." ¶27 Under the "any competent evidence" standard of review and the evidence presented, we hold the "medical necessity" for a van with a lift was shown. The evidence is more than sufficient to show the scooter is necessary for Claimant and that she has to rely on herself to transport it wherever she goes. The van containing the lift equipment is, therefore, a necessary part of the award if the scooter is to have any value at all for her recovery. See Zwahlen v. B.F. Goodrich, 1988 OK 54, 755 P.2d 658; Oklahoma Gas & Electric Co. v. Chronister, supra. ¶28 At the time of an injury, future amendments to statutes are unknown. Claimants, employers and insurers alike make decisions at that time about whether and how to pursue a claim for workers' compensation. The accrual of these substantive rights, including the appropriate standard of review for a particular claim, cannot be diminished by statutory language claiming otherwise, i.e., "regardless of the date of injury" found in §340(D). We, therefore, hold the inserted language "regardless of the date of injury" in 85 O.S. 2011 §340(D) is a nullity as to claims pending on August 26, 2011. The appellate standard of review in this case is "any competent evidence" because that is the standard in effect on the date of Claimant's injury. THE STATUTE IN EFFECT AT THE TIME OF CLAIMANT'S INJURYDID NOT LIMIT THE TTD COMPENSATION TO A TOTAL OF 300WEEKS ¶29 In holding that Dunkelgod was limited to a maximum of 300 weeks of TTD benefits, COCA stated at ¶21: Dunkelgod is subject to a 300 week maximum award of TTD, both under the version of Section 22 in effect at the time of the injury, based on the reasoning of Ranchwood,15 and under the 2005 amendment to Section 22.16 It is unclear from the record when Dunkelgod reached that point. We vacate the award and remand for determination of when Dunkelgod reached the 300 week maximum. ¶30 Claimant argues that COCA applied the wrong statute for injuries occurring on June 11, 2001. She contends the statute in effect at the time of her injury, 85 O.S. 2001 §22(2)(c),17 contained no limit on TTD as long as good cause was shown for extending benefits beyond the statutory limit of 156 weeks. We agree and hold the law in effect at the time of Claimant's injury included no 300-week maximum for TTD benefits and that "good cause" for additional TTD benefits was shown at the time of the award on July 12, 2010. ¶31 We find error in COCA's holding for several reasons. First, Ranchwood is inapposite to this case. COCA construed the 2001 statute which is also applicable herein. However, the issue was whether the claimant was entitled to additional TTD benefits despite his failure to request them at the 42nd week of the previous award, required by subsection (b) of §22(2), relating to injuries incurred after November 1, 1994. That issue is not presented here. Next, COCA's application of subsection (b) to apply the 300-week maximum to subsection (c), which contains no such limitation, is clearly error in view of the plain language used in subsection (c). Claimant's injury date clearly and unequivocally places her within subsection (c) of the 2001 statute. Finally, reliance on the 2005 amendment to 85 O.S. §22(2)(c) is erroneous because her injury occurred on June 11, 2001. On that date, the 2005 statute did not exist. COCA's attempt to use it here, through the application of Ranchwood, supra, contravenes workers' compensation law before,18 and after,19 August 26, 2011. CONCLUSION ¶32 The law in effect at the time of injury determines the standard of review in workers' compensation appeals. COCA's application of the "clear weight of the evidence" standard of review destroyed Claimant's constitutionally protected substantive right to have her appeal considered under the "any competent evidence" standard of review. Similarly, consideration of the law on the date of injury also determines the appropriate law to use for determining the amount of TTD benefits. The application of the later-enacted version of 85 O.S §22 denied Claimant continuing TTD benefits to which she was entitled. ¶33 COURT OF CIVIL APPEALS' OPINION IS VACATED; WORKERS' COMPENSATION COURT'S ORDER IS SUSTAINED AND REMANDED FOR FURTHER PROCEEDINGS. CONCUR: Colbert, V.C.J., Watt, Winchester, Edmondson and Reif, JJ. CONCUR IN PART; DISSENT IN PART: Kauger, Combs (joins Kauger, J.) and Gurich, JJ. DISSENT: Taylor, C.J. I join and agree with Justice Kauger in her writing concerning the total lack of competent evidence of the medical necessity for the lift van. FOOTNOTES 1 On July 8, 2005, the court ordered TTD benefits to continue until further order. On March 12, 2008, the trial court found Claimant remained temporarily totally disabled and ordered 52 additional weeks of TTD. A similar order was entered on May 5, 2009. 2 The three judge panel's order also modified the trial court's order to correct Employer's name, to reserve the issue of injury to the thoracic spine, and to order Employer to pay interest on the accrued portion of the 52 week TTD award. However, as to all other matters in the orders, the panel held: "The orders filed herein on July 12, 2010, as modified, shall remain in full force and effect as the orders of this Court." 3 Section 26, at the time of Parks and at the time of injury in the present case, June 11, 2001, provided in pertinent part: B. [T]he decision of the Court shall be final as to all questions of fact, and except as provided in Section 3.6 of this title, as to all questions of law. 4 We explained: By force of §26, all findings of fact made in the trial tribunal's decision under review are conclusive and binding unless they have been ascertained to lack support in competent evidence. It is only in the absence of such support that a trial tribunal's decision may be viewed as erroneous as a matter of law and hence subject to appellate vacation. [emphasis in original] [footnotes omitted]. Parks, supra, at 551-552. At that time, 85 O.S. 2001 §3.6(F) provided: F. Benefits for an injury shall be determined by the law in effect at the time of injury; benefits for death shall be determined by the law in effect at the time of death. 5 Although 85 O.S. Supp. 2010, §3.6(C) did not contain the all-encompassing language found in §340(D), in Dunlap and Nomac, supra, we relied on the fact that the injuries underlying these claims occurred prior to the effective date of the amendment of §3.6(C). 6 Section 340 provides for "against the clear weight of the evidence" review without regard to the date of injury, while §315 ties the benefits to be recovered to the law "at the time of injury." . 7 The statute of limitations under the new law enacted in 2011, 85 O.S. 2011 §318, provides in part: A. The right to claim compensation under the Workers' Compensation Code shall be forever barred unless, within two (2) years after the date of accidental injury or death, a claim for compensation is filed with the Workers' Compensation Court . . . . The former law, 85 O.S. §43, was similar to the current law. 8 We note that at the time of Claimant's injury, as well as in 2010 when §3.6 was amended, the statute provided at §3.6(F) (2001) and §3.6(G) (2010), as follows: Benefits for an injury shall be determined by the law in effect at the time of injury; benefits for death shall be determined by the law in effect at the time of death. The new Code, at 85 O.S. 2011 §315, provides: Benefits for a single event injury shall be determined by the law in effect at the time of injury. Benefits for a cumulative trauma injury or occupational disease or illness shall be determined by the law in effect at the time the employee knew or reasonably should have known that the injury, occupational disease or illness was related to work activity. Benefits for death shall be determined by the law in effect at the time of death. [emphasis added]. 9 The former and current statutes are shown below: 85 O.S. 2001 §22(2)(c): (c) With respect to injuries occurring on or after November 1, 1997, total payments of compensation for temporary total disability may not exceed a maximum of one hundred fifty-six (156) weeks in the aggregate except for good cause shown, as determined by the Court. 85 O.S. 2011 §331: Except as otherwise provided in this act, the average weekly wages of the injured employee at the time of the injury shall be taken as the basis upon which to compute compensation. . . . 10 We held in Cowart, supra, that Art. 5, §54 prohibited the repeal of an act from destroying a cause of action which had already accrued, even though the action had not been filed before the statute was repealed. 665 P.2d at 317-318. 11 Despite the appellate court's reference made to "any competent evidence" it is clear COCA weighed the evidence. 12 On May 11, 2009, Dr. C. stated in his written report: She had a request today to be considered for a lift vehicle which I think would be appropriate in order to give her some degree of independence. Her mother has recently had a double mastectomy and cannot help her with lifting her equipment and the like. I also recommend that she have a new MRI of the lumbar spine and return when this has been done. 13 The transportation companies in the report include Medride which is not located in Tulsa, and PMSI which charged $52.08 for the initial load and $170.00 per one-way trip. Leasing a van to accommodate a scooter costs $2799.94 per month, including taxes and insurance. 14 The order on appeal, affirming the orders of July 12, 2010, was filed on November 19, 2010. Her Petition for Review was filed on December 8, 2010. 15 Ranchwood Auto Lube v. Woessner, 2004 OK CIV APP 24, 86 P.3d 1101. 16 85 O.S. Supp. 2005 §22(2)(c) provided: (c) With respect to injuries occurring on or after November 1, 1997, total payments of compensation for temporary total disability may not exceed a maximum of one hundred fifty-six (156) weeks in the aggregate except for good cause shown, as determined by the Court. Total payments of compensation for temporary total disability, inclusive of consequential injuries, may not exceed a maximum of three hundred (300) weeks in the aggregate. [emphasis added] 17 85 O.S. 2001 §22(2)(c) provides: 2. Temporary Total Disability. . . .. . . (c) With respect to injuries occurring on or after November 1, 1997, total payments of compensation for temporary total disability may not exceed a maximum of one hundred fifty-six (156) weeks in the aggregate except for good cause shown, as determined by the Court. [emphasis added]. 18 See 85 O.S. 2001 §3.6(F): Benefits for an injury shall be determined by the law in effect at the time of injury; . . . . 19 See 85 O.S. 2011 §315: Benefits for a single event injury shall be determined by the law in effect at the time of injury. . . . KAUGER, J., concurring in part and dissenting in part: ¶1 I agree with the majority that the law as it stands on the date of injury is the appropriate law to use for determining TTD benefits. I also agree with the majority that the law in effect at the time of injury determines the standard of review. The Court of Civil Appeals erred by applying a clear weight of the evidence standard to the trial court's evaluation of Claimant's request that Williams Companies, Inc. be required to provide Claimant with a van for transportation. However, I dissent because under any standard, including the proper standard of any competent evidence, claimant is not entitled to a van because no competent evidence was presented that it is medically necessary. Additionally, it appears inappropriate under the facts for Claimant to be operating a motor vehicle of any kind. I. The Proper Standard of Review Is Any Competent Evidence and the Statute in Effect at the Time of Claimant's Injury did not Limit TTD Benefits to 300 Weeks. ¶2 The majority is correct that the standard of review applicable to a workers' compensation appeal is that which is in effect when the claim accrues, notwithstanding the Legislature's attempt to alter this standard. At the time of Claimant's injury on June 11, 2001, the standard of review required for review of factual determinations by a three-judge panel of the Worker's Compensation Court was one of any competent evidence.1 The legislature enacted the new Workers' Compensation Code, 85 O.S. 2011, §§301-413 on August 26, 2011. The new version of §340, concerning appeals, provides for an against the clear weight of the evidence standard of review without regard for the date of the injury, with the intent that an against the clear weight of the evidence standard of review will apply to every appeal filed after August 26, 2011.2 ¶3 The Legislature's attempt to apply a clear weight of the evidence standard of review for all appeals from the Worker's Compensation Court is invalid. The Oklahoma Constitution protects the right to pursue causes of action that have already accrued, or when suit has been commenced, from being terminated by legislative action. Okla. Const., art. 5, §52 provides that: The Legislature shall have no power to revive any right or remedy which may have become barred by lapse of time, or by any state of this State. After suit has been commenced on any cause of action, the Legislature shall have no power to take away such a cause of action, or destroy any existing defense to such. Okla. Const., art. 5, §54 provides that: The repeal of a statute shall not revive a statute previously repealed by such statute, nor shall such repeal affect any accrued right, or penalty incurred, or proceedings begun by virtue of such repealed statute. In worker's compensation cases, the date a claim accrues is the date of the injury suffered by the claimant.3 In King Manufacturing v. Meadows, 2005 OK 78, 127 P.3d 584, we held that: The general rule is that the law in effect at the time of an employee's injury controls in workers' compensation matters. A compensation claim is controlled by the laws in existence at the time of injury and not by laws enacted thereafter. The right of an employee to compensation arises from the contractual relationship existing between the employee and the employer on the date of injury. The statutes then in force form a part of the contract and determine the substantive rights and obligations of the parties. No subsequent amendment can operate retrospectively to affect in any way the rights and obligations which are fixed.4 ¶4 When construing the November 1, 2010 amendment to 85 O.S. §3.6, this Court previously held that the standard of review a claim is subject to on appeal is a substantive right determined by the law in effect on the date of the injury, and where the injury occurred before the amendment to the statute, the traditional standard of any competent evidence applied.5 While this case concerns the new code section on appeal, 85 O.S. 2011 §340, the same logic applies. The legislature may not alter the standard of review for a claim by statute after that claim has accrued, because the standard of review is a substantive right which is unaffected by later-enacted legislation, regardless of the intent of the legislature, and is protected by the Oklahoma Constitution.6 ¶5 For similar reasons, the Court of Appeals erred in determining that Claimant was limited to a maximum of 300 weeks of TTD benefits. The statute in effect at the time of Claimant's injury, 85 O.S. 2001 §22(2)(c), contained no limit on TTD as long as good cause was shown for extending benefits beyond the statutory limit of 156 weeks.7 Good cause was shown at the time of the award on July 12, 2010, and so there was no statutory cap on the number of weeks Claimant could be awarded TTD benefits: applying the 2005 statute would be inappropriate for the reasons discussed above, because the law was changed after the occurrence of Claimant's injuries and therefore after her claim accrued. II. Claimant is not Entitled to a Van Because No Competent Evidence Was Presented That it is Medically Necessary. ¶6 I dissent, however, to the award of a lift van to the Claimant because no competent evidence was presented that a van is medically necessary. In order for an employer to be required to provide medical apparatus, the apparatus must be necessary.8 Not only is the Claimant in this case capable of walking, no competent evidence has been presented that a van is in some way essential to her recovery. The statements of Dr. Capehart, one of Claimant's treating physicians, indicate that he believed a lift vehicle "would be appropriate in order to give [Claimant] some degree of independence" and the trial court, in its July, 2010, order noted that Dr. Capehart "recommends transportation assistance to improve claimant's mobility, independence and ultimate psychological recovery/stability." The Court of Appeals correctly indicated that Claimant has not been found to have a compensable psychological overlay. The rest of Dr. Capehart's points indicate that he believes a van would be appropriate to give the plaintiff some independence, but no evidence has been presented to link the claimant's independence and ability to go get ice cream whenever she wants to any kind of medical necessity related to her injuries. ¶7 Another of Claimant's treating physicians, Dr. James Rodgers, stated in his deposition that he doesn't know that claimant needs a van. When asked if a van or even a car with a big seat would be medically necessary for claimant, Dr. Rodgers responded: I don't know. I just don't know. I'm not sure I have the information to know whether that's even - why it's even being considered in her case. I've got vans being considered in paralyzed spinal cord injury patients, but she looks better now to me in the last three visits than before.9 Dr. Rodgers noted that generally, vans are medically necessary for patients that require hand controls in place of pedals because they are unable to operate a normal vehicle. When asked if he knew of any medical reason why Claimant would need the van, Dr. Rodgers could only say "I'm trying to not answer. I'm trying to say I don't have the answer."10 That testimony from Dr. Rogers can hardly be considered competent evidence that providing Claimant with a van is medically necessary. ¶8 On further examination, when Dr. Rogers was asked if he believed claimant being able to get out of the house more and be social would be beneficial to her, Dr. Rogers responded that it would.11 Something that is beneficial or that might be good for Claimant's independence is being confused with something that is medically necessary. They are not the same thing. Dr. Rogers admitted that he could see the reasoning behind a lift van when it came to transporting the Claimant's scooter to places like the zoo, and when the climate is less than ideal such as when it is 110 degrees or icy, but that still provides no link to a lift van itself being medically necessary to Claimant's recovery. ¶9 When asked if there were things she would like to be able to get out and do, Claimant responded: Sometimes, you know, if I want to run to Braum's and get an ice cream Sunday, or something like that, during the day, well, I can't do it. I have to wait until, you know, my sister is available, or maybe later when mom gets home, but she's always so tired that she can't - usually can't take me to get one, so I don't get one.12 There is no reason Claimant would even need her scooter, let alone a lift van to carry it, for a trip to a place such as Braum's. She would never need to leave a vehicle if she went through the drive-through. Even if she wanted to get out of the car, she is fully capable of walking for short periods of time and Dr. Rodgers mentions specifically that her becoming dependent on the scooter would be bad for her.13 It appears that Claimant believes her former employer should be required to replace her broken vehicle, not because a lift van is medically necessary to her recovery, but simply so that she has a vehicle to go where she wants, when she wants, and cannot afford one herself.14 ¶10 When offered the use of a service to come and pick her up when she needed to go someplace, Claimant objected because of the tight quarters she would be forced to share with strangers due to germs and because it would not give her the independence she desires.15 In her deposition, Claimant had the following conversation: Q: Do you care if they provide you with some service to come by to pick you up?A: Yes, I do.Q: Why is that?A: A) because of the strangers, B) because I'm susceptible to all germs and sicknesses, and if people have them, and it's in tight quarters, then I would catch it.16 Evidence was not presented that a lift van, rather than some other form of transportation such as a service, was medically necessary to Claimant's recovery; she simply appears to prefer that option. When reminded that she would also have to be around others and their germs when going to Braum's for ice cream, Claimant responded "but it's not sitting on germs, and doing all this stuff."17 ¶11 While no competent evidence was presented that providing Claimant with a lift van was medically necessary, it does appear from the evidence presented that there is a valid question as to whether Claimant should be operating a motor vehicle of any kind. Claimant stated that she takes several different medications on a daily basis: Oxycontin, Soma, Mobic, Klonopin, Hydrocodone, Baclofen, Neurontin, Effexor, Lunesta, Trazodone, a generic version of Senna, and Relistor.18 When Claimant renewed her driver's license several months before her deposition, she did not take a driving test, and did not inform them that she was taking over 10 different medications, including Oxycontin and Hydrocodone.19 Claimant's attorney pointed out that certain medications recommend against driving while they are being taken, but that others in Claimant's family would be able to drive the van if she was on certain medications that day. Not only does Claimant take these medications every day, but having to rely on other family members for transport seems to be what Claimant wishes to avoid by getting the van in the first place. If other family members will have to drive it because she is under the influence of her medications, then what is the point in awarding it? ¶12 Claimant's dependence on medication is something that appears to be unlikely to change in the near future. Dr. Rodgers stated he believed that "she'll always be on some - she'll always be on a sizeable amount of medication. I think the chance of her being off all the narcotics that she's on is less than one percent that she'll be off of them."20 He elaborated further on the problems faced by someone taking the amount of medication Claimant is taking: [T]here's a price for being able to drive, and that's taking half of the medication and half the narcotics she's taking. We can do anything as a bonus prize because if you reduced her in half of what she's taking now, she won't have any sedative effects from the narcotics. And after you take narcotics for a period of time - if we took six pills today, we'd both be asleep, but if we take six pills every day for a month, we probably are not going to have any sedation problems. We'll probably have some sleep problems, getting to sleep is where you have problems if you're on narcotics for a while. So she is bright and wake [sic] when I see her. There's no question her reaction time - moving rapidly is not as good when you're on the medications she's on.21 ¶13 No competent evidence was presented that providing Claimant with a lift van was medically necessary, but evidence was presented that perhaps allowing Claimant to drive at all was not in the best interests of her or the public. Claimant's desire for independence and greater freedom of movement does not mean she is entitled to a free vehicle at the expense of her former employer. I agree with the majority that the law as it stands on the date of injury is the appropriate law to use for determining the amount of TTD benefits a claimant is entitled to. Further, I agree with the majority's holding that the proper standard of review of the medical necessity of providing Claimant with a lift van is whether there was any competent evidence rather than the clear weight of the evidence. However, Claimant fails to meet the burden in this case under any standard of review. Accordingly, I respectfully dissent regarding the award of a lift van to Claimant. FOOTNOTES 1 Parks v. Norman Miller Municipal Hosp., 1984 OK 53, ¶2, 684 P.2d 548. ("[W]hile the three-judge panel is governed, in its re-examination of the trial judge's factual findings, by the clear-weight-of-the-evidence standard, the Supreme Court or the Court of Appeals, in reviewing the panel-altered factual determinations, must apply the any-competent-evidence test.") 2 Title 85 O.S. 2011 §340(D) provides in pertinent part: After the effective date of this act, regardless of the date of injury, the Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds: 1. The Court acted without or in excess of its powers; 2. The order or award was contrary to law; 3. The order or award was procured by fraud; or 4. The order or award was against the clear weight of the evidence. 3 King Manufacturing v. Meadows, 2005 OK 78, ¶ 11, 127 P.3d 584 4 King Manufacturing v. Meadows, note 3, supra. (footnotes omitted). 5 Nomac Drilling LLC v. Mowdy, 2012 OK 45, ¶8, 277 P.3d 1282; Dunlap v. The Multiple Injury Trust Fund, 2011 OK 14, ¶1, 249 P.3d 951. 6 Okla. Const., art. 5, §52; Okla. Const., art. 5, §54. 7 Title 85 O.S. 2001 §22(2)(c) provides: injuries occurring on or after November 1, 1997, total payments of compensation for temporary total disability may not exceed a maximum of one hundred fifty-six (156) weeks in the aggregate except for good cause shown, as determined by the Court. 8 Zwahlen v. B.F. Goodrich, 1988 OK 54, ¶4, 755 P.2d 658. 9 Deposition of Dr. James Rodgers, January 14, 2010, at 19. 10 Deposition of Dr. James Rodgers, January 14, 2010, at 19. 11 Deposition of Dr. James Rodgers, January 14, 2010, at 23. 12 Deposition of Kristy Dunkelgod, January 4, 2010, at 18. 13 Deposition of Dr. James Rodgers, January 14, 2010, at 23. 14 Deposition of Kristy Dunkelgod, January 4, 2010, at 18. 15 Deposition of Kristy Dunkelgod, January 4, 2010, at 20. Claimant appears to be completely opposed to the kind of contact with strangers that is the norm for the residents of many major U.S. cities who use public transportation on a daily basis to commute to and from their place of employment and to go about their lives. 16 Deposition of Kristy Dunkelgod, January 4, 2010, at 19-20. 17 Deposition of Kristy Dunkelgod, January 4, 2010, at 34. 18 Deposition of Kristy Dunkelgod, January 4, 2010, at 16. 19 Deposition of Kristy Dunkelgod, January 4, 2010, at 24. 20 Deposition of Dr. James Rodgers, January 14, 2010, at 23. 21 Deposition of Dr. James Rodgers, January 14, 2010, at 18. GURICH, J., concurring in part and dissenting in part: ¶1 I agree with the portion of the majority opinion that holds that the statute in effect at the time of the claimant's injury did not limit the TTD compensation to a total of 300 weeks. However, I dissent to the award of a lift van. I join the portion of Justice Kauger's opinion that concludes Claimant is not entitled to the award of a lift van. I also dissent to the portion of the majority opinion that holds that the 2011 amendment to the standard of review applies prospectively only. ¶2 This Court's workers' compensation case law directs that statutes may apply retroactively when the Legislature has made its intent to do so clear. CNA Ins. Co. v. Ellis, 2006 OK 81, ¶ 13, 148 P.3d 874, 877.1 When an amended statute directs that it be applied retroactively, we can only disregard the statutory directive and apply the amendment prospectively if the amendment affects the substantive rights of the parties. ¶3 Here, the intent of the Legislature to apply this statute retroactively can be found in the plain words of the statute: "After the effective date of this act, regardless of the date of injury, the Supreme Court may modify, reverse, remand for rehearing, or set aside the order or award upon any of the following grounds . . . [t]he order or award was against the clear weight of the evidence." 85 O.S. 2011 § 340(D) (emphasis added). In Dunlap v. Multiple Injury Trust Fund, 2011 OK 14, 249 P.3d 951, we construed the 2010 amendment to the statute, which changed the appellate standard of review from any competent evidence to against the clear weight of the evidence, but was silent on the issue of retroactivity. Consequently, we held that the amendment could only be applied prospectively. Dunlap, 2011 OK 14, ¶ 1, 249 P.3d at 951. Because the language of the 2011 statute unequivocally states that the new standard of review applies regardless of the date of injury, the question before this Court is whether the amendment affects the substantive rights of the parties. ¶4 In Cole v. Silverado Foods, Inc., 2003 OK 81, ¶ 15, 78 P.3d 542, 548, the amendment at issue shortened the time to request a hearing for complete adjudication from five years to three years. In applying the change prospectively, we held that "after-enacted legislation that increases or diminishes the amount of recoverable compensation or alters the elements of the claim or defense by imposition of new conditions affects the parties' substantive rights and liabilities." Id. ¶5 In American Airlines Inc. v. Crabb, 2009 OK 68, 221 P.3d 1289, a 2005 amendment redefined cumulative trauma, adding language throughout the specific statute.2 We held that the addition of the language "the major cause of which results from," added a new element to the claim which was not part of the definition in effect on the date of the injury. Id. ¶ 16, 221 P.3d at 1292. As such, the amendment's new requirement that a claimant prove that cumulative trauma was the "major cause" of the injury did not apply retroactively because it substantively affected the parties' rights by requiring an additional element of proof. Id. ¶6 In Ellis, 2006 OK 81, ¶ 1, 148 P.3d at 875, we reviewed a 2001 amendment concerning cumulative trauma injuries. Before the 2001 amendment, the law allowed apportionment of liability between successive employers and their insurers; after the 2001 amendment, liability was imposed on the last of the successive employers to expose claimant to cumulative trauma. Id. ¶ 7, 148 P.3d at 876. We held that the obligation to pay benefits was a substantive right vested and fixed by law at the time of claimant's injury, so the amendment imposing liability on the last employer did not apply retroactively. Id. ¶¶ 14-15, 148 P.3d at 877-78. ¶7 In Scruggs, two 2005 amendments to the Workers' Compensation Act were at issue.3 One amendment defined objective medical evidence as evidence that met "the criteria of Federal Rule of Evidence 702 and all U.S. Supreme Court case law applicable thereto," and the other amendment stated that compensation for permanent disability had to be supported by competent medical testimony which included application of Rule 702 of the Federal Rules of Evidence. Id. ¶ 2, 154 P.3d at 1259. We held that both before and after the 2005 amendments, a compensable claim for injury resulting from inhalation of a toxic substance was based upon scientific evidence and that application of Daubert and Kumho by the 2005 amendments made no substantive change in the law and applied to all claims regardless of the claimant's date of injury. Id. ¶ 22, 154 P.3d at 1265. ¶8 In King Mfg. v. Meadows, 2005 OK 78, ¶ 1, 127 P.3d 584, 586, a 1995 amendment limited the sum of permanent partial disability awards for a change in condition to 100%. The 100% limits were absent from the 1991 statute in effect at the time of claimant's initial injury. Id. We held that the award of permanent disability for a change in condition was governed by the statutory language in effect at the time of the initial injury, rather than the statutory limits in effect when the change in condition was discovered because the change in the statute affected "employees' rights regarding the amount of recoverable compensation." Id. ¶ 14, 127 P.3d at 589-90. ¶9 In this case, the trial court found that the claimant had a compensable injury in 2001 to her lumbar back and awarded her TTD.4 Claimant subsequently sought other medical treatment including a three-wheeled scooter and vehicle lift, which the trial court awarded.5 The Claimant now seeks a lift van, which is the subject of this appeal. ¶10 The change to the standard of review on appeal does not add any additional elements of proof to the claim and does not increase or diminish the amount of recoverable compensation. 85 O.S. 2001 § 14(A)(1), in effect on the date of claimant's injury,6 provides that an employer must promptly provide an injured employee with medical, surgical or attendance or treatment, nurse and hospital service, medicine, crutches, and apparatus as may be necessary after the injury. 85 O.S. 2001 § 14(A)(1). The employer is required to provide the requested treatment apparatus to the claimant only if the apparatus is medically "necessary." Zwahlen v. B.F. Goodrich, 1988 OK 54, ¶ 4, 755 P.2d 658, 659. ¶11 The Scruggs case is most analogous to the present case. There we found that both before and after the amendment, scientific evidence was required to prove a compensable claim resulting from inhalation of a toxic substance.7 Likewise, in this case, both before and after the amendment to the standard of review, claimant had to produce competent medical evidence to prove by the preponderance of the evidence that the lift van was medically necessary. Using the new standard, the Court of Civil Appeals reweighed the evidence and arrived at a different result than the trial judge. However, the claimant's burden to produce sufficient evidence to support her claim for a lift van remained the same.8 Her cause of action for the lift van was not "destroyed" by the 2011 change as the majority claims. Additionally, the majority's speculation that the claimant might have presented different evidence at trial had she known the standard of review on appeal would be the clear weight of the evidence standard is unconvincing. Claimant knew at trial that if her case was appealed to a three-judge panel, that the panel would have the right to reweigh the evidence based on their review under the clear weight of the evidence standard. ¶12 Although not binding, I am also persuaded by decisions in several other jurisdictions that have held that workers' compensation standards of review are procedural and may be applied retroactively.9 Additionally, at least three of the four divisions of the Court of Civil Appeals have found that the language of the statute controls and have applied the new appellate standard of review, regardless of the date of injury.10 ¶13 We have said that it is not the job of this Court to "interfere 'with the wisdom or policy of the legislation.'" Rivas v. Parkland Manor, 2000 OK 68, ¶ 15, 12 P.3d 452, 457. "The formulation of the particular elements and details of the Workers' Compensation Act clearly falls within the legislature's province." Id. ¶ 19, 12 P.3d at 458. The amendment to the standard of review found in 85 O.S. 2011 § 340(D) controls, and the standard of review in this appeal should be the clear weight of the evidence standard. FOOTNOTES 1 Amendments relating solely to remedies and affecting only modes of procedure "are generally held to operate retroactively and apply to pending proceedings." Scruggs v. Edwards, 2007 OK 6, ¶ 8, 154 P.3d 1257, 1261. Any doubts about whether the Legislature intended for an amendment to apply prospectively or retroactively must be resolved against retroactive effect. Ellis, 2006 OK 81, ¶ 13, 148 P.3d at 877. 2 In that case, cumulative trauma was redefined as "a compensable injury, the major cause of which results from employment activities which are repetitive in nature and engaged in over a period of time and which is supported by objective medical evidence as defined in this section." Id. ¶ 14, 221 P.3d at 1292. We held that "describing the injury as a 'compensable' injury did nothing more than express a modifier that was already implied" and "specifying that objective medical evidence was necessary to prove the 'injury' and 'major cause' was a permissible procedural requirement that 'made no substantive change in the law.'" Id. ¶ 15, 221 P.3d at 1292. 3 Scruggs, 2007 OK 6, ¶¶ 1-2, 154 P.3d at 1259. 4 The trial court reserved the issues of psychological overlay and consequential bowel injury. The record reflects that the court has yet to decide these issues. 5 The record reveals that during the hearing on the lift van, claimant testified that the vehicle lift, previously awarded by the trial court, was no longer sufficient because her car didn't work anymore. 6 At the time of the trial on the lift van, 85 O.S. 2005 § 14(A)(1) was in effect. The language of the 2005 statute is the same as the language of the 2001 statute. 7 Scruggs, 2007 OK 6, ¶ 22, 54 P.3d at 1265. 8 As the Court of Civil Appeals pointed out in this case, although the parties relied primarily on the any competent evidence standard of review in their briefs, both acknowledged the statutory change to the standard of review and also argued their positions under the clear weight of the evidence standard "'[j]ust in case' this Honorable Court applie[d] the standard of review of re-weighing the evidence." See Answer Brief of Respondent at 12. 9 See Truckstops of America, Inc. v. Engram, 469 S.E.2d 425, 427 (Ga. Ct. App. 1996) ("The statute is procedural, there is no vested right in preserving appellate review of the ALJ's decision under the [statute] which existed at the time the ALJ [heard] the case."); Pospisil's Case, 525 N.E.2d 646, 647 (Mass. 1988) (holding that statute relating to standard of review had no impact on the merits questions involved in determining the amount of compensation or the parties' substantive rights to receive or not to pay compensation and so was procedural and had to be applied retroactively); Armstrong v. Asten-Hill Co., 752 P.2d 312, 314 (Or. Ct. App. 1988) ("The scope of review has nothing to do with entitlement to 'payment of benefits as authorized, and in the amounts provided for, by the law in force at the time [of] the injury.'"); Kinninger v. Ind. Claim Appeals Office of State of Colo., 759 P.2d 766, 767-68 (Colo. App. 1988) (finding that the change to the standard of review was a procedural change in the law that was applicable to all cases pending at the time the new statute became effective); Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 58 (Minn. 1984) (finding that the amendment to the standard of review did not impose any new liability, burden, or obligation on either party, nor did the amendment deprive or alter the employee's right to collect benefits upon presentation of adequate proof of entitlement; and the amendments did not change the kind of evidence required to make out a claim). 10 Harvey v. Auto Plus of Woodward, 2012 OK CIV APP 92, ¶ 18, ___P.3d___ (Div. I) ("We hold that the Legislature clearly expressed its intent that 85 O.S. § 340(D) be applied retroactively and that the statute does not affect the substantive rights of the parties."); Lee v. Sundance Rehab. Corp., 2012 OK CIV APP 77, ¶ 5, 248 P.3d 469, 471 (Div. II) ("The standard of review in effect when this appeal was ready for decision is that provided in [85 O.S. 2011§ 340(d)], and we review the factual issues in this case to determine whether they are against the clear weight of the evidence."); Rural Waste Mgmt. and Indem. Ins. Co. of North America v. Harold Mock and The Workers' Comp. Court, case no. 108,330 (Dec. 9, 2011) (Div. III) (unpublished), cert. granted April 23, 2012. Division IV has issued conflicting opinions. Compare McGuire v. N. Glantz & Sons LLC, 2012 OK CIV APP 59, ¶ 9, 278 P.3d 1060, 1061 (Div. IV) ("Claimant's petition for review was commenced August 30, 2011, after the August 26, 2011, effective date of 85 O.S. 2011 § 340, which sets out the standard of review in an action for review commenced after its effective date.") with Franklin Elec. Sales, Inc., and Franklin Elec. Co., Inc. v. Tina Lanette Aaron and The Workers' Comp. Court, Case No. 108,539 (Sept. 2, 2011) (Div. IV) (unpublished) (applying the law in effect on the date of claimant's injury, presumably because the petition in error in that case was filed before the effective date of the 2011 amendment).

24ecb76c-d16b-40f2-b3d0-a3e7e3bab9fa

Harmon v. Cradduck

oklahoma

Oklahoma Supreme Court

HARMON v. CRADDUCK2012 OK 80Case Number: 106269Decided: 09/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. SONNY LAUREN HARMON, Plaintiff-Appellant,v.PAUL CRADDUCK, GLYNN BOOHER, AND ALICE TURNER, Defendants-Appellees. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION I, ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMACOUNTY, STATE OF OKLAHOMA, HONORABLE DANIEL L. OWENS ¶0 Oklahoma Department of Corrections inmate Sonny Lauren Harmon brought an action against three employees of the John Lilley Correctional Center, Paul Cradduck, Warden Glynn Booher, and Alice Turner, following the seizure and alleged conversion of a gold wedding ring. The District Court of Oklahoma County entered summary judgment on behalf of each defendant. Harmon timely appealed the decision. The Court of Civil Appeals, Division I, affirmed the trial court's ruling, and we granted certiorari to review whether summary disposition was supported by the record. After reviewing the record, we find that the settled-law-of-the-case-doctrine precludes reconsideration of Harmon's compliance with administrative exhaustion requirements, and it was error to hold otherwise. In addition, the existence of a factual dispute mandates our reversal of summary judgment in favor of defendant Paul Cradduck on plaintiff's conversion claim. However, we conclude the district court properly awarded summary judgment to each of the defendants for any claim brought under 42 U.S.C. § 1983. Further, any claims based on the purported tortious conduct of Booher and Turner were properly disposed of by the trial judge and COCA. THE COURT OF CIVIL APPEALS OPINION IS VACATED; THE TRIAL COURT'S ORDER GRANTING SUMMARY JUDGMENT ON HARMON'S CONVERSION CLAIM AGAINST DEFENDANT CRADDUCK IS REVERSED; TRIAL COURT'S ORDER AWARDING SUMMARY JUDGMENT ON APPELLANT'S REMAINING CLAIMS IS AFFIRMED; CAUSE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH TODAY'S PRONOUNCEMENT Sonny Lauren Harmon, Pro Se1Ronald Anderson, Assistant General Counsel, Oklahoma Department of Corrections, Oklahoma City, Oklahoma GURICH, J. Facts and Procedural History Harmon I ¶1 Sonny Lauren Harmon is an inmate incarcerated with the Oklahoma Department of Corrections. Between October 3, 2003, and December 6, 2004, Harmon was housed at the John Lilley Correctional Center. In November of 2004, Harmon was moved to the segregation housing unit at JLCC prior to his scheduled transfer to another facility. JLCC staff conducted a routine inventory of Harmon's property in connection with this status change. Some of his personal effects, including a gold ring with stones, a gold watch, and miscellaneous personal items,2 were deemed contraband under DOC policy and were confiscated by JLCC officers. Defendant Paul Cradduck stored the items in the JLCC property room, placing the ring in his desk where it was left unsecured. Sometime later Harmon's gold ring was either lost or stolen.3 The remaining personal property was either returned to Harmon, disposed of under DOC contraband policy, or is not at issue in this case. ¶2 On December 8, 2004, Harmon began efforts filed a grievance "Request to Staff" with Warden Booher, seeking a return of the seized property through the required administrative channels. When Harmon's attempts to resolve his dispute through the informal resolution process failed, he presented a grievance to Warden Booher on January 5, 2005. However, on January 28, 2005, the Warden rejected Harmon's grievance his claim on procedural grounds. Warden Booher's response provided Harmon with inconsistent directions, informing him (a) that the grievance was being returned unanswered for failure to comply with DOC procedure; and (b) that he had fifteen (15) days to present an appeal of the decision to the DOC director.4 Following his appeal, the DOC director informed Harmon that his review proceeding was premature based on the Warden's decision to return the grievance unanswered. Harmon attempted to seek clarification of DOC's determination and was advised to resubmit his grievance with Warden Booher. Harmon once again presented the grievance to Warden Booher; however, it was rejected for failure to correct the original submission within ten days of the January 28th response. ¶3 On August 10, 2005, Harmon filed suit against DOC, the JLCC facility, and Warden Booher for the loss of his ring, watch, and other miscellaneous property items. His petition alleged certain personal effects had been wrongfully detained by prison officials. Although Harmon alleged the seizure of his property was a violation of the Oklahoma and United States Constitutions, his petition merely requested a return of the items or compensation for their value. ¶4 The defendants sought a stay of the lawsuit to conduct an internal investigation of the accusations and to prepare a report addressing the substance of Harmon's claims.5 The trial judge sustained the motion, and DOC filed its special report on April 18, 2006. According to the report and attached materials, Officer R. Shepard confiscated several items from Harmon in November 2004. The report included an affidavit from Cradduck in which he conceded that the gold ring had been deposited in an unsecured desk and stolen from the JLCC property room by an "unknown person or persons." A DOC disciplinary letter dated January 27, 2005, was also attached to the report. It indicated that DOC had reprimanded Cradduck for violating agency policy in mishandling Harmon's ring. Booher's written admonishment also referenced prior disciplinary actions against Cradduck, including two incidents involving lost inmate property. ¶5 DOC and Booher filed a motion simultaneously with the report, requesting an order dismissing Harmon's suit for failure to state a claim, or in the alternative, an order awarding summary judgment. DOC maintained that Harmon had failed to exhaust his administrative remedies and had neglected to provide notice under the Oklahoma Governmental Tort Claims Act.6 The trial judge sustained the motion and entered a judgment in favor of the defendants on May 24, 2006. ¶6 Harmon appealed the judgment and the matter was assigned to COCA, Division IV. In an unpublished opinion, Harmon I,7 COCA reversed the district court in part and remanded the matter to allow Harmon an opportunity to amend his original petition. COCA reasoned that a trier of fact, based on documentation uncovered during DOC's internal investigation, could "conclude that a JLCC property room officer intentionally diverted [Harmon's] property . . . in light of the officer's prior disciplinary record" and/or "appropriated [Harmon's] ring for himself." Harmon I, at 19-20. COCA held that Harmon had exhausted his administrative remedies because he "substantially complied with the procedure set forth in OP-090124," and dismissal based on this affirmative defense was error. Harmon I, at 12, 15. Finally, COCA held that dismissal of the tort claims was appropriate because the record did not reflect Harmon's compliance with the notice provisions of the GTCA.8 Harmon I, at 15. COCA remanded the case, giving Harmon an opportunity to amend his petition to cure any pleading deficiencies, establish compliance with the GTCA notice provisions, and to articulate the viability of any claims predicated on § 1983. Harmon I, at 20. Neither party sought certiorari, and mandate was issued on July 19, 2007. Harmon II ¶7 On remand,9 Harmon filed an amended petition on December 17, 2007, naming Cradduck, Booher, and Turner as defendants, "in their individual capacity to impose personal liability."10 DOC was not renamed as a defendant. The second petition alleged that Cradduck converted Harmon's wedding ring for his own personal use under state tort law. It also claimed that Cradduck's wrongful act had deprived him of personal property and violated his civil rights under 42 U.S.C. § 1983. The petition included a new contention, suggesting Booher and Turner engaged in fraud to coverup Cradduck's theft of the ring. This concealment, according to Harmon, required application of equitable tolling for purposes of the limitations periods under the GTCA. Following service on each defendant, DOC counsel sought another stay of proceedings to obtain a supplemental investigative report. ¶8 On July 11, 2008, counsel for DOC filed a motion seeking dismissal or summary judgment, with a second special report attached on behalf of all three employees. DOC's supplemental report was very similar to the first. The report acknowledged the loss of Harmon's ring; however, it included a new affidavit wherein Cradduck specifically denied misappropriating the ring. The supplemental report also contained a recent letter of reprimand, detailing additional disciplinary action taken against Cradduck on July 7, 2008, for the disappearance of Harmon's watch.11 Harmon filed an objection to the motion to dismiss; however, on August 15, 2008, the trial court once again entered judgment in favor of the defendants on all counts.12 ¶9 Harmon appealed, and the case was assigned to COCA, Division I. COCA affirmed the trial court, with one judge dissenting.13 Harmon timely petitioned this Court for certiorari, arguing that the decision from COCA directly conflicted with findings made in the first appeal and that summary judgment was improperly based on disputed material facts in the record. No responsive pleading was filed on behalf of the defendants. This Court granted certiorari and allowed each party to submit supplemental briefs. Harmon filed a Supplemental Brief and Request for Oral Argument; however, no brief was tendered by Appellees.14 Standard of Review ¶10 An order sustaining summary judgment in favor of a litigant presents solely a legal matter. Feightner v. Bank of Oklahoma, N.A., 2003 OK 20, ¶ 2, 65 P.3d 624, 626 (quoting Carmichael v. Beller, 1996 OK 48, ¶ 2, 914 P.2d 1051, 1053); see also Trask v. Franco, 446 F.3d 1036, 1043 (10th Cir. 2006) (applying de novo standard to review summary judgment in 42 U.S.C. § 1983 action). Questions of law mandate application of the de novo standard of review, which affords this Court with plenary, independent, and non-deferential authority to examine the issues presented. Martin v. Aramark Servs., Inc., 2004 OK 38, ¶ 4, 92 P.3d 96, 97. ¶11 Examination of an order sustaining summary judgment requires Oklahoma courts to determine whether the record reveals disputed material facts or whether reasonable minds could draw different conclusions from undisputed facts. Cranford v. Bartlett, 2001 OK 47, ¶ 3, 25 P.3d 918, 920. All facts and inferences must be viewed in a light most favorable to the party opposing summary adjudication. Estate of Crowell v. Bd. of Cnty. Comm'rs of Cnty. of Cleveland, 2010 OK 5, ¶ 22, 237 P.3d 134, 142 (citing Manley v. Brown, 1999 OK 79, ¶ 22, 989 P.2d 448, 455). If the essential fact issues are in dispute, or reasonable minds might reach different conclusions in light of the inferences drawn from undisputed facts, summary judgment should be denied. Schovanec v. Archdiocese of Oklahoma City, 2008 OK 70, ¶ 39, 188 P.3d 158, 172. Analysis The settled-law-of-the-case doctrine does not allow for reconsideration of Harmon's compliance with the administrative exhaustion requirements. ¶12 As a preliminary matter, we must address whether COCA committed error in Harmon II by affirming the trial court's finding that Harmon failed to exhaust his administrative remedies. Under the settled-law-of-the-case doctrine, all issues decided in an earlier appeal, either expressly or impliedly, are firmly established and may not be reconsidered in any subsequent stage of the proceedings.15 Bierman v. Aramark Refreshment Servs., Inc., 2008 OK 29, ¶¶ 11-12, 198 P.3d 877, 881. A second tribunal is bound to pay deference to legal findings rendered in a prior appellate decision. Worsham v. Nix, 2006 OK 67, ¶ 27, 145 P.3d 1055, 1064. ¶13 COCA in Harmon I held that the requirements of administrative exhaustion had been satisfied.16 However, despite COCA's pronouncement in Harmon I, the trial court once again ruled that Harmon had failed to exhaust his administrative remedies necessary to assert claims against the defendants.17 Because neither party sought certiorari, the issue of exhaustion as it pertained to the loss of Harmon's ring, could not be challenged a second time. Summary judgment was improperly granted in favor of defendant Cradduck on Harmon's conversion claim. ¶14 The next question presented is whether COCA erred in affirming summary judgment on Harmon's conversion claim against Cradduck. Harmon contends that evidence revealed via DOC's internal investigation supports his theory regarding Cradduck's alleged conversion of the ring. We agree and find that materials attached to the reports presented in connection with DOC's investigation, when viewed in a light most favorable to Harmon, create a sufficient dispute of material facts to mandate reversal of the order granting summary judgment. ¶15 Conversion has been defined as the unauthorized assumption and exercise of dominion over personal property of another person which is inconsistent with the rights of the owner. Welty v. Martinaire of Okla., Inc., 1994 OK 10, ¶ 6, 867 P.2d 1273, 1275. There is no dispute that Harmon's gold ring was stolen and that the theft was without consent.18 Therefore, the only three elements of Harmon's conversion claim at issue are (1) whether Harmon was the owner of the gold ring with stones; (2) whether Cradduck intentionally diverted the ring for his own personal benefit; and (3) if the former two elements are established, the amount of damages suffered by Harmon. ¶16 A number of details provided in the DOC investigative documents lend support for Harmon's contention he was the owner of the gold ring seized by prison officials. Both of the agency's motions for summary judgment and accompanying reports acknowledged that on December 6, 2004, Harmon had possession of a gold ring with stones.19 Harmon has consistently maintained his ownership of the gold ring in question. Photographs and other documents in the record also indicate that in 1999 Harmon had previously possessed a gold ring matching the description of the same one seized by JLCC officers in 2004. DOC contested Harmon's ownership, asserting that he did not have possession of a gold ring with stones when he arrived at JLLC in October of 2003. For purposes of summary judgment, there was sufficient evidence to create a factual dispute on the issue of ownership of the gold ring with stones. see Brown v. Okla. State Bank & Trust Co. of Vinita, 1993 OK 117, ¶¶ 8-9, 860 P.2d 230, 233 (concluding affidavit of plaintiff asserting ownership of funds created fact question requiring denial of motion seeking summary judgment). ¶17 The record also reflects a factual dispute on the issue of whether Cradduck intentionally diverted Harmon's ring for his own personal use. The defendants have not challenged the salient facts surrounding confiscation of Harmon's gold ring or its subsequent disappearance from the JLCC secure property area. Cradduck has denied involvement in the ring's theft. However, Cradduck was disciplined in connection with the loss of the ring. The record reflects that on at least four occasions Cradduck was reprimanded for failing to follow DOC regulations governing the proper handling of inmate property. In each instance, Cradduck's transgressions resulted in the loss of inmate property and disciplinary action. A jury could reasonably conclude, based on this pattern, that Cradduck had been diverting inmate property for his own use. Although he denied misappropriating the ring, Cradduck's self-serving affidavit alone does not eliminate the existence of a factual dispute on the issue. see Okla. Dept. of Sec. ex rel. Faught v. Wilcox, 2011 OK 82 ¶ 20, 267 P.3d 106, 111; Poafpybitty v. Skelly Oil Co., 1973 OK 110, ¶ 17, 517 P.2d 432, 438 (finding that an affiant's interest in the outcome of a suit is enough to require the testing of his or her credibility before the trier of fact). ¶18 To the extent Cradduck asserts DOC policy as a defense to the conversion claim, this too is controverted. Strict adherence to DOC policies regulating the handling and disposal of contraband might afford a defense to Harmon's claim of conversion. see First Bank of Okarche v. Lepak, 1998 OK 46, ¶ 14, 961 P.2d 194, 198; see also Hawkins v. Montana State Prison, 2004 MT 289, ¶ 22, 102 P.3d 2, 5 (holding prison officials entitled to raise prison policy defense in conversion action stemming from seizure of contraband). However, DOC policies may not be invoked to shield an officer from liability if that officer has failed to abide by the particular terms and conditions set forth in those rules. Consequently, compliance with DOC policy outlining the seizure and handling of inmate contraband in this case, is a question which should be left to the trier of fact. ¶19 Cradduck's repeated disciplinary history for displaced inmate property, the admitted loss of the gold ring with stones, and Cradduck's undisputed access to the ring, provide sufficient evidence to create discord over essential elements of Harmon's conversion claim. Accordingly, the order awarding summary judgment in favor of Cradduck on Harmon's conversion claim is reversed, and the cause is remanded for further proceedings.20 The trial court properly rejected Harmon's claim under 42 U.S.C. § 1983. ¶20 Harmon next challenges COCA's affirmation of summary judgment for his claims under 42 U.S.C. § 1983. The amended petition filed by Harmon alleged that Cradduck violated his civil rights as a result of the "the illegal acts in taking my personal effects without just compensation." Amended Petition, at 6. Harmon argues his property was taken by Cradduck without due process of law in violation of the Fourth, Fifth and Fourteenth Amendments of the United States Constitution. Second, Harmon suggests that defendants Booher and Turner engaged in a fraudulent scheme to conceal information from Harmon during the grievance process "designed to deceive and defeat Plaintiff's constitutional rights to recover his property."21 We conclude that neither theory supports recovery under § 1983.22 ¶21 To establish a valid cause of action under Section 1983, a plaintiff must demonstrate (1) a person has acted under color of law, (2) to deprive another of rights secured by federal law or the Constitution. West v. Atkins, 487 U.S. 42, 48 (1988).23 Because Harmon's property was confiscated by JLLC officers according to DOC prison policy, the taking of such items occurred under color of state law. West v. Atkins, 487 U.S. 42, 49 (1988). Therefore, our inquiry is limited to whether the record presents a factual dispute on the question of Harmon's alleged deprivation of rights secured by the Constitution. ¶22 Harmon's § 1983 claim is centered on what he perceives as an unconstitutional deprivation of property. More particularly, Harmon argues his ring was taken by Cradduck without due process of law in violation of the Fourth, Fifth and Fourteenth Amendments. A section 1983 action based on property deprivation requires a plaintiff to show he or she had a constitutionally protected interest in that property as defined by state law. American Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 59 (1999). To the extent a prisoner is afforded a right to possess certain personal belongings, deprivation of that property only raises constitutional concerns if due process is overlooked. Parratt v. Taylor, 451 U.S. 527, 537 (1981), overruled in part on other grounds, Daniels v. Williams, 474 U.S. 327 (1986). ¶23 The fundamental concern in a due process analysis is the opportunity to be heard at a meaningful time and in a meaningful manner. Parratt, 451 U.S. at 450 (citing Armstrong v. Manzo, 380 U.S. 545, 552 (1965)). The United States Supreme Court has determined that postdeprivation remedies made available by state tort law may satisfy due process requirements: Although the state [tort] remedies may not provide the respondent with all the relief which may have been available if he could have proceeded under § 1983, that does not mean that the state remedies are not adequate to satisfy the requirements of due process. The remedies provided could have fully compensated the respondent for the property loss he suffered, and we hold that they are sufficient to satisfy the requirements of due process. Parrat, 451 U.S. at 544. The Supreme Court took this a step further when it found that the unauthorized intentional taking and/or destruction of inmate property does not support an action under § 1983 when state law provides an adequate postdeprivational remedy. Hudson v. Palmer, 468 U.S. 517, 536 (1984). ¶24 In Wilhelm v. Gray, we weighed a litigants § 1983 claim in light of Parratt and Hudson, and we concluded that under federal law, a § 1983 action may not be maintained for a constitutional deprivation if adequate and meaningful state grounds for redress exist. Wilhelm v. Gray, 1988 OK 142, ¶ 11, 766 P.2d 1357, 1359. In the present case, Harmon has a meaningful state remedy available; he may pursue his alleged property loss claim in a state law conversion case against the officer he suggests is responsible. ¶25 To the extent Harmon's § 1983 claim is founded on the allegedly deceptive conduct of Booher and Turner during the grievance process, we similarly find such an accusation does not present a constitutional issue. An alleged violation of prison grievance policies, created by operation of state law, will not support a cognizable claim under § 1983. Gaines v. Stenseng, 292 F.3d 1222, 1225 (10th Cir. 2002) (holding that because § 1983 requires a plaintiff to prove she/he was deprived of a right under federal law, violation of a state statute or prison regulations will not suffice); see also Murray v. Albany County Bd. of County Comm'rs, 211 F.3d 1278, 2000 WL 472842 (10th Cir. April 20, 2000). ¶26 Even liberally construing Harmon's amended petition and the record before this Court, we find no evidence of a constitutional violation. Harmon has an adequate postdeprivation remedy through a state court action against Cradduck for recovery of the loss of his gold ring with stones. The conduct of Booher and Turner does not support a cognizable claim under § 1983. It was, therefore, proper to award summary judgment for any claims based on 42 U.S.C. § 1983. Any tort claims raised by Harmon against appellees, other than the conversion claim against Cradduck, were properly dismissed. ¶27 The amended petition filed by Harmon, when liberally construed, raised additional claims based on allegedly tortious conduct of the defendants. The petition also requested application of equitable tolling to allow additional time to satisfy the notice provisions under the GTCA.24 ¶28 Notice is a jurisdictional prerequisite to bringing an action under the GTCA. Shanbour v. Hollingsworth, 1996 OK 67, ¶ 7, 918 P.2d 73, 75. Failure to present written notice as required by the GTCA results in a permanent bar of any action derivative of the tort claim. 51 O.S.Supp.2003, § 156(B). Harmon admittedly has never given notice under the GTCA. This Court will not consider such an argument when Harmon has never attempted to serve notice under the Act. Any additional tort claims Harmon may raise, other than for conversion against Cradduck, are prohibited under the GTCA statute of limitations. Conclusion ¶ 29 Accordingly, we vacate the COCA opinion and remand the matter to the trial court to finally resolve this enduring litigation. The sole surviving claim after is Harmon's claim predicated on Cradduck's alleged conversion of the gold wedding ring with stones. The trial court properly granted judgment and disposed of all other claims. On remand, the trial court is directed to enter an appropriate scheduling order so the case may be presented on its merits. THE COURT OF CIVIL APPEALS OPINION IS VACATED; THE TRIAL COURT'S ORDER GRANTING SUMMARY JUDGMENT ON HARMON'S CONVERSION CLAIM AGAINST DEFENDANT CRADDUCK IS REVERSED; TRIAL COURT'S ORDER AWARDING SUMMARY JUDGMENT ON APPELLANT'S REMAINING CLAIMS IS AFFIRMED; CAUSE REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH TODAY'S PRONOUNCEMENT ¶30 Taylor, C.J., Colbert, V.C.J., Kauger, Watt, Winchester, Edmondson, Combs, Gurich, JJ. - Concur ¶31 Reif, J. - Disqualified FOOTNOTES 1 Debra K. Hampton filed her Entry of Appearance as "co-counsel of record" on January 12, 2010, after the briefing cycle had been completed. 2 The property identified by Harmon included a surge protector, extension cable, headphones, long-john top, German-English dictionary, game set, soft drinks, pictures, and a laundry bag. 3 Harmon alleges Cradduck intentionally converted the ring for his own personal gain. Cradduck maintains the ring was stolen by an unknown individual/individuals and denies personal involvement in the theft. 4 According to DOC OP 090124 (V)(A)(7), when a grievance is returned unanswered, it must be resubmitted within ten (10) days. The procedure for appealing a decision made by the facility's reviewing authority is set forth in OP 090124 (VII); it provides that an appeal must be presented within fifteen (15) days of receipt of the reviewing authority's response. 5 Title 57 O.S.Supp. 2004 § 566.4(K) authorizes the trial judge to stay court proceedings so an investigation may be conducted by DOC officials to review the substance of an inmate lawsuit. The statute requires DOC to present its findings in a "special report," detailing the facts behind the lawsuit and what, if any, action should be taken to resolve the matter. 6 51 O.S.2001 § 151 et seq. 7 Harmon v. Booher, Case No. 103,481 (June 20, 2007) (unpublished). 8 The court also noted that the claims might be barred under 51 O.S.Supp. 2004 § 155(24) from injuries arising out of the "operation or maintenance" of correctional facilities. Harmon I, at 15. 9 Harmon also attempted to remove his own state court action to federal court under 28 U.S.C. § 1446. see Harmon v. Cradduck, Case No. CIV-07-1072-C, 2007 WL 4246004 (W.D. Okla. Nov. 29, 2007). Applying the abstention doctrine of Younger v. Harris, 401 U.S. 37 (1971), the federal court case was dismissed on November 27, 2007. 10 Alice Turner was employed by DOC as Warden Booher's assistant. 11 Supplemental Report of Review of Factual Basis of Claims Asserted in Prisoner Petition, attachment 12 (July 11, 2008). Harmon's amended petition did not raise a conversion claim for any alleged misappropriation of the watch. 12 DOC's motion was identified as both a motion to dismiss under 12 O.S. 2001 § 2012(B)(6) and a motion for summary judgment. The district court's Journal Entry of Judgment found that Harmon had failed to state a claim upon which relief could be granted, and sustained summary judgment. In Harmon II COCA reviewed the lower court's ruling under the summary judgment standards. Because the trial judge weighed material outside of the pleadings, we are evaluating this appeal as one granting summary judgment. State ex rel., Wright v. Oklahoma Corp. Comm'n, 2007 OK 73, ¶ 48, 170 P.3d 1024, 1039. 13 Judge Hansen dissented to that portion of Harmon II which awarded summary judgment to Cradduck on Harmon's conversion claim, explaining "I agree with the Harmon I Court that DOC's special report presents evidence from which the trier of fact could find [Cradduck] acted outside the scope of his employment in appropriating [Harmon's] ring for himself without authorization." Harmon II, at 2 (Hansen, J., dissenting). 14 Harmon's request for oral argument is denied. Okla. Sup. Ct. R. 1.9. 15 We have recognized exceptions to the application of this doctrine in cases where the prior decision is palpably erroneous or when failing to reverse the initial determination would result in a gross or manifest injustice. Dean v. Multiple Injury Trust Fund, 2006 OK 78, ¶ 7, 145 P.3d 1097, 1100. 16 "Accordingly, we find [Harmon] exhausted DOC's administrative remedies. The trial court's determination otherwise was in error, as was its dismissal of [Harmon's] claim on this ground." Harmon I, at 15. 17 In Harmon II, COCA declined to give any deference to its predecessor in Harmon I under the settled-law-of-the-case doctrine. Although the amended petition named new parties, the principles of res judicata bind not only parties to the prior proceedings, but also their privies. Northside State Bank v. Board of County Comm'rs Tulsa Cnty., 1994 OK 34, ¶ 10, 894 P.2d 1046, 1050 (citing Cartwright v. Atlas Chemical Indus., Inc., 1981 OK 4, ¶ 14, 623 P.2d 606, 611-12). COCA's ruling in Harmon I on the issue of exhaustion was definitive. Because the same facts formed the basis of both the original petition and the amended petition, and the newly named parties were not strangers to the original action, summary judgment based on failure to comply with the exhaustion prerequisites was error. 18 July 11, 2008 Supplemental Report, Attachment 16, affidavit of Paul Cradduck. 19 In the July 11, 2008 Motion to Dismiss/Motion for Summary Judgment, Statement of Undisputed Material Facts, number 8A, acknowledges seizing a "gold ring w/ stones" as contraband on December 6, 2004. 20 The GTCA generally precludes the naming of individual state employees for tort claims arising in the scope of their employment. Martin v. Johnson, 1998 OK 127, ¶ 28, 975 P.2d 889, 895. However, any malicious or bad faith act by an employee falls outside the scope of employment for purposes of the GTCA. Nail v. City of Henryetta, 1996 OK 12, ¶ 7, 911 P.2d 914, 916 (citing Parker v. City of Midwest City, 1993 OK 29, 850 P.2d 1065). Because Cradduck's alleged theft of the ring would have been an act outside the scope of employment, the resulting tort claim would not be governed by the GTCA, and would not be subject to the notice provisions of the act. 21 Amended Petition, at 2. Although Harmon does not specifically refer to § 1983 in support of his cause against Booher and Turner, we have liberally construed the amended petition in accordance with the rule announced in Haines v. Kerner, 404 U.S. 519, 520-21 (1972). 22 The trial court disposed of Harmon's § 1983 claims on several grounds, including immunity under the United States Constitution. Concluding the defendants had been sued in their official capacities, the lower court reasoned that the action was the equivalent of one brought against the state. Oklahoma has not waived sovereign immunity, and consequently such a proceeding would be barred by the Eleventh Amendment. see Will v. Michigan Dept. Of State Police, 491 U.S. 58, 66 (1989). Yet, Harmon's amended petition clearly designated the defendants "in their individual capacity to impose personal liability." Amended Petition, at p. 1. Although we find the record does not support a § 1983 case against the defendants, the trial court's justification for reaching this result was flawed. Kentucky v. Graham, 473 U.S. 159, 167, n. 14 (1985); Colvin v. McDougall, 62 F.3d 1316, 1317 (11th Cir. 1995) (holding that in evaluating personal/individual versus official capacity for purposes of a § 1983 lawsuit, courts must look to the complaint and the course of proceedings). 23 Section 1983 does not create any substantive rights, but instead provides injured parties with a remedy for the deprivation of rights established elsewhere. McLin v. Trimble, 1990 OK 74, ¶ 25, 795 P.2d 1035, 1042 (citing City of Oklahoma City v. Tuttle, 471 U.S. 808, 816 (1985)). 24 51 O.S.Supp. 2003 § 156 requires a claimant to submit notice of any claim against the State of Oklahoma by sending it in writing to the Office of Risk Management Administrator within one (1) year of the loss.

b5e288b7-60f7-489f-9a84-faaa320fc21f

Waltrip v. Osage Million Dollar Elm Casino

oklahoma

Oklahoma Supreme Court

WALTRIP v. OSAGE MILLION DOLLAR ELM CASINO2012 OK 65Case Number: 109030Decided: 06/26/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. John A. Waltrip, Petitioner,v.Osage Million Dollar Elm Casino and/or Osage Tribe, Hudson Insurance Co. and the Workers' Compensation Court, Respondents. CERTIORARI TO COURT OF CIVIL APPEALSDivision II ¶0 Injured employee of a tribal enterprise brought a claim against his employer's workers' compensation insurer under the estoppel act. The Workers' Compensation Court, Honorable Owen T. Evans, dismissed the claim for lack of jurisdiction. The Court of Civil Appeals sustained the order denying jurisdiction. CERTIORARI PREVIOUSLY GRANTED;OPINION OF COURT OF CIVIL APPEALS VACATED;ORDER OF WORKERS' COMPENSATION COURT REVERSED AND REMANDED WITH INSTRUCTIONS. Bryce A. Hill, Law Office of Bryce A. Hill, Tulsa, Oklahoma, for Petitioner.Leah P. Keele, Brandy L. Shores, Brian J. Goree, Latham, Wagner, Steele & Lehman, P.C., Tulsa, Oklahoma, for Respondents. COLBERT, V.C.J. ¶1 An employee of a tribal enterprise seeks to invoke the jurisdiction of the Oklahoma Workers' Compensation Court. This Court holds (1) the tribe enjoys sovereign immunity and is not therefore subject to the jurisdiction of the Oklahoma Workers' Compensation Court and (2) the workers' compensation insurer does not enjoy the tribe's immunity and is estopped to deny coverage under a policy for which it accepted premiums computed in part on the employee's earnings. FACTS AND PROCEDURAL HISTORY ¶2 The facts are undisputed. The Osage Million Dollar Elm Casino (Employer) is a tribal enterprise of the Osage Nation, a federally recognized Indian tribe. It carries a policy issued by Hudson Insurance Company (Insurer) for "sovereign nation workers' compensation insurance." A third party, Tribal First, administers claims asserted under the policy. ¶3 John A. Waltrip (Employee) fell on a patch of ice while working as a surveillance supervisor at the casino and injured primarily his right shoulder. Employee initially obtained treatment from his personal physician but Tribal First sent him to an orthopedic specialist who recommended surgery on August 25, 2009. The specialist confirmed that the need for shoulder surgery was due to the December 9, 2008, injury rather than an injury ten years earlier. No authorization for surgery has been provided. ¶4 Employee filed a claim in the Oklahoma Workers' Compensation Court on July 17, 2009, seeking medical treatment and temporary total disability. Employer and Insurer asserted that court lacked jurisdiction based on the tribe's sovereign immunity. A hearing was held solely on the jurisdictional issue on November 23, 2010, at which the parties presented arguments. On December 9, 2010, the Workers' Compensation Court denied jurisdiction and dismissed the claim holding that the tribe enjoys sovereign immunity and that the provisions of the tribe's workers' compensation policy did not subject Insurer to liability for claims in state court. The Court of Civil Appeals affirmed and this Court granted certiorari review. STANDARD OF REVIEW ¶5 This matter presents only the question of the jurisdiction of the Workers' Compensation Court over Insurer concerning Employee's claim. A jurisdictional issue is reviewed de novo and may be reviewed without a denial or award of benefits. Triad Transport, Inc. v. Wynne, 2012 OK 30, ¶ 7, 276 P.3d 1013, 1016. ANALYSIS ¶6 This is the latest in a series of cases involving an injured employee of an Indian tribe or a tribal enterprise who seeks to invoke the jurisdiction of the Oklahoma Workers' Compensation Court. Four opinions by this Court in 1997 are collectively known as the Indian sovereignty causes. See Dominic v. Creek Nation, 1997 OK 41, 936 P.2d 935; Little v. Muscogee (Creek) Nation, 1997 OK 57, 938 P.2d 739; Wahpepah v. Kickapoo Tribe of Okla., 1997 OK 63, 939 P.2d 1151; Muscogee Nation v. Smith, 1997 OK 66, 940 P.2d 498. "In each of these cases the sovereign Indian nation purchased insurance policies from the State Insurance Fund and paid premiums based on its employees' salaries. Each policy was issued to cover claims filed in accordance with the [Workers' Compensation] Act." Shorter v. Tulsa Used Equip.& Indus. Engine Servs., 2006 OK 72, ¶ 9 n.21, 148 P.3d 864, 869 n.21. In each case the insurer was "estopped to deny coverage based on the tribe/nation's sovereign immunity" because the 'estoppel act' became applicable when the insurer collected premiums on covered employees. Id. ¶7 Sections 65.2 and 65.3 of the Workers Compensation Act, collectively known as the "estoppel act," prevent those who insure employers against liability under the Workers' Compensation Act from denying coverage based on the status of the parties. The estoppel act "makes insurers liable, regardless of the insured's status as a covered employer, when it is established that - at the time of the injury - premiums computed on a claimant's wages were accepted under a policy insuring the employer against liability under the Workers' Compensation Act." Wahpepah, 1997 OK 63, ¶ 13, 939 P.2d at 1154-55. Section 65.2 provides: Every employer and every insurance carrier who schedules any employee as a person employed by the employer for the purpose of paying or collecting insurance premiums on a Workers' compensation insurance policy or who pays, receives or collects any premiums upon any insurance policy covering the liability of such employer under the Workers' compensation law by reason of or upon the basis of the employment of any such employee shall be estopped to deny that such employee was employed by the employer in a hazardous employment subject to and covered by the Workers' compensation law if such person receives an accidental personal injury arising out of and in the course of his employment, during the period for which such premium was so received, regardless of the type of business in which the employer was engaged or the type of employment in which the employee was engaged at the time of such injury. Okla. Stat. tit. 85 (Supp. 2010). Section 65.3 provides: Every contract of insurance issued by an insurance carrier for the purpose of insuring an employer against liability under the Workers' Compensation Act shall be conclusively presumed to be a contract for the benefit of each and every person upon whom insurance premiums are paid, collected, or whose employment is considered or used in determination of the amount of premium collected upon such policy for the payment of benefits as provided by the Workers' Compensation Act regardless of the type of business in which the employer of such person is engaged or the type of work being performed by the employee at the time of any injury received by such employee arising out of and in the course of his employment, which contract may be enforced by such employee as the beneficiary thereof. Id. The essence of these provisions was carried forward into the 2011 enactment of the Workers' Compensation Code at section 357 which provides: Every employer and insurance carrier who schedules any employee as a person employed by the employer for the purpose of paying or collecting insurance premiums on a workers' compensation insurance policy or who pays, receives or collects any premiums upon any insurance policy covering the liability of such employer under the workers' compensation law by reason of or upon the basis of the employment of any such employee shall be estopped to deny that such employee was employed by the employer. Okla. Stat. tit. 85 (2011). As explained in the Indian sovereignty causes, "[t]he rationale of the 'estoppel act' is that an insurer who accepts premiums should not evade liability for benefits due under compensation law." Dominic, 1997 OK 41, ¶ 10, 936 P.2d at 939. ¶8 Since as early as 2007, appellate courts in Oklahoma have been confronted with the task of interpreting the provisions of "sovereign nation workers' compensation" policies issued to tribe's and their enterprises by Hudson Insurance, Inc., the insurer in this matter. Decisions from the Court of Civil Appeals that have construed the policies have upheld the tribes' sovereign immunity while refusing to apply the estoppel act to the insurer due to the provisions of the insurance contract. See Hamby v. Cherokee Nation Casinos, 2010 OK CIV APP 21, 231 P.3d 700; Quinton v. Cherokee Nation Enters., 2010 OK CIV APP 16, 229 P.3d 581; Pales v. Cherokee Nation Enters., 2009 OK CIV APP 65, 216 P.3d 309; Hall v. Cherokee Nation, 2007 OK CIV APP 49, 162 P.3d 979 (collectively Cherokee Nation cases). The lower courts cited that line of cases to reach the same result. This Court granted certiorari review of this matter to explain the application of the estoppel act to the claims of injured employees of a tribal enterprise under this sovereign nations workers' compensation policy. ¶9 Insurer in this matter argues that the policy provisions demonstrate no intent to cover the claims of injured workers under Oklahoma's Workers' Compensation Code and therefore it is not subject to the estoppel act. The policy at issue describes its coverage as follows: Sovereign Nation Workers' Compensation means the workers or workmen's compensation benefits as established by you [the tribe]. It does not include any state, federal worker or workmen's compensation law, any federal occupational disease law or the provisions of any law that provide non-occupational disability benefits. Recognizing the tribe as a sovereign nation, with its corresponding civil jurisdiction, the actual benefits provided by this policy are subject to the tribal ordinance related to workers compensation benefits, in effect as of the effective date of this policy. In the absence of a tribal ordinance you may or may not elect to utilize a state's workers' compensation benefit levels as a guideline for the benefits payable under this policy. However, in no event shall benefits payable exceed such state level benefits. The mere use of a state's benefit levels as a guide for payments, however, does not constitute an adoption of such state's benefit levels and shall not be construed as a waiver of your sovereign immunity. The policy further provides that "[f]or the purposes of this policy, law shall mean, unless otherwise specifically identified, tribal ordinance or any other law to which you are subject." ¶10 The terms of the policy clearly contemplate the claims of injured workers will be adjudicated in tribal court pursuant to a tribe's workers' compensation ordinance. However, in the Osage Nation there is no tribal ordinance that applies to workers' compensation. Instead, in the absence of a tribal ordinance, Insured's third party administrator, Tribal First, operates under a set of "Workers' Compensation Provisions" which it has crafted to handle workers' compensation claims as the "sole and exclusive remedy by which injured workers' [sic] or their beneficiaries receive benefits provided for by these Provisions." Under the Tribal First Provisions, "[i]f an order is issued that the worker disagrees with," the worker may submit a written protest and an "appeal" may be filed with the "Tribal First Program Manager." "If it is determined that the appeal cannot be resolved, binding arbitration may be considered." 1 ¶11 By its apparently unilateral adoption of the Provisions, Tribal First appears to function as legislature, executive, trial court, and appellate court regarding the claims of injured workers while functioning as an agent of Insurer. No mention of these Provisions or Tribal First appear in the contract of insurance between Insurer and the tribal enterprise. There is nothing in the record to indicate the Tribe has approved or even considered the Tribal First Provisions. "Workers' compensation is a mechanism for providing wage benefits and medical care to injured workers and spreading the cost of these benefits through insurance." Parret v. UNICCO Serv. Co., 2005 OK 54, ¶ 19, 127 P.3d 572, 578. It is the product of quid pro quo between the employer and the employee. To facilitate workers' compensation and its objectives, an "industrial bargain" was imposed. The employee gave up the right to bring a common law negligence action against the employer and in return received automatic guaranteed medical and wage benefits. The employer gave up the common law defenses and received reduced exposure to liability. Id., ¶ 20, 127 P.3d at 578. The action of a legislative body is required to make such provisions effective, not the unilateral and discretionary acts of a workers' compensation insurer. ¶12 Under the Osage Nation Constitution, the Osage Nation Congress is vested with the exclusive authority to enact laws with the signature of the Principal Chief. See Osage Nation Const. art. VI, §§ 12&13. No workers' compensation ordinance has been enacted, no procedure for adjudicating claims has been developed by the Tribe, and no forum for adjudicating such claims is currently available within the tribal legal system. Insurer knew or should have known these facts at the time it issued the policy. Yet, Insurer wilfully and intentionally collects premiums from the tribal enterprise for providing workers' compensation benefits under a nonexistent tribal ordinance believing that it will step into the shoes of the Tribe and receive the benefit of the Tribe's sovereign immunity. Thus, Insurer obtains unjust enrichment from its adhesion contract with the Tribe.2 ¶13 A decision in 2006 from this Court, in a non-tribal context, relied on the Indian sovereignty causes to explain the application and reach of the estoppel act. Shorter v. Tulsa Used Equipment and Industrial Engine Services, 2006 OK 72, 148 P.3d 864, explained that the status of an employer or employee as "covered" under the Workers' Compensation Code is not controlling. Id.,¶¶ 9&10, 148 P.3d at 869-870. This Court further explained that the focus of the estoppel act is not on the policy terms and noted that the provisions of the estoppel act "are utterly devoid of requirements that either contractual or consensual elements of claimant's relationship to the insured be established. The focus is, rather, on the rights of an injured claimant against the insurance carrier of the entity for whom claimant was acting when injured. These rights are purely statutory." Id., ¶ 10, 148 P.3d at 870 (footnotes omitted)(emphasis added). "The terms of the estoppel act are plainly contemplated to apply to all those situations where a worker's employment is not covered by the specific provisions of the insured's policy but whose wages were used in premium calculations." Id., ¶ 13, 148 P.3d at 871-872.3 Thus, the estoppel act is directed towards insurers, not insurance policies. ¶14 As this Court explained in the Indian sovereignty causes and further explained in Shorter, the estoppel act confers third party beneficiary status on the injured worker 4 and prevents the insurer from denying coverage based on the employer's status. Therefore, the sovereign immunity of the employer constitutes no barrier to its injured employees' invocation of the estoppel act absent a tribal ordinance that identifies the applicable law and forum for the adjudication of workers' compensation claims.5 ¶15 If this Court were to give effect to Insurer's analysis of this matter, its obligation to provide benefits on behalf of the tribe and its injured workers would render the policy provisions illusory and inane. Insurer would possess the ability to arbitrarily deny claims and yet evade any judicial review in any tribal, federal, or state court. It would leave no avenue for an injured worker of the tribal enterprise to compel Insurer's performance under the policy in a judicial forum. ¶16 The issue in this matter is not whether Insurer is arbitrarily denying claims. Rather, the question is whether Insurer's promise to pay workers' compensation benefits is effectual in the absence of a tribal ordinance and a tribally sanctioned process for resolving disputes concerning benefits in either tribal or state court. Under such circumstances, Insurer's promise to provide benefits would become illusory and a sham but for application of the estoppel act. Insurer's third party administrator would by default become the final arbiter of the workers' compensation claims of employees of the tribal enterprise. No detached and neutral adjudicator would be accessible to a claimant without Insurer's consent. Insurer alone would determine whether it will pay benefits without the fear of legal action in any tribal, federal, or state court. To allow this procedure to go forward would be trampling on the fundamental rights of employees to due process under the state and federal constitutions and the Osage Nation Constitution.6 ¶17 The Tribe's sovereign immunity does not place Insurer beyond the reach of the estoppel act when there is no tribal ordinance or forum for the adjudication of workers' compensation claims under a policy of "sovereign nation workers' compensation." Such claims will be adjudicated in tribal court under a tribal ordinance when both law and a forum exist. Only when such law and forum are unavailable to an injured employee will the estoppel act operate to bring the Insured alone under the purview of Oklahoma's Workers' Compensation Code. ¶18 It is the absence of a tribal workers' compensation ordinance and the lack of a tribal forum that distinguishes this matter from Cherokee Nation cases in which the Court of Civil Appeals refused to apply the estoppel act to claims asserted under a "sovereign nations workers' compensation" policy. The Cherokee Nation has a tribal workers' compensation ordinance by which it adjudicates workers' compensation claims in its tribal court. If Insurer wishes to be certain that the claims of tribal enterprise employees will not be adjudicated in the Oklahoma Workers' Compensation Court pursuant to the Workers' Compensation Code, it should require that a tribe enact a tribal ordinance and provide a forum for the adjudication of workers' compensation claims before it contracts to insure those claims pursuant to tribal ordinance. ¶19 Today's decision in no way holds or implies that the Osage Nation is not immune from the jurisdiction of the Oklahoma Workers' Compensation Court. The Indian sovereignty causes resolved that issue long ago. Additionally, tribal sovereign immunity for the actions of tribal enterprises has been acknowledged widely.7 That acknowledgment is not diminished by today's holding which is directed only at Insurer's promise to provide workers' compensation benefits to employees of the tribal enterprise. The Osage Nation is entirely within its authority should it choose to enact a workers' compensation ordinance and provide a tribal forum. In the absence of such ordinance or forum, however, Insurer is not entitled to evade liability. Regardless of the tribes' sovereign immunity, the Oklahoma Workers' Compensation Court may exercise jurisdiction over Insurer, which is a Delaware corporation, and its third party administrator. ¶20 This claim, brought in the Workers' Compensation Court pursuant to the estoppel act, should have been asserted against Insurer and not the tribal enterprise. On remand, that court is instructed to reinstate the claim against Insurer only. CERTIORARI PREVIOUSLY GRANTED;OPINION OF COURT OF CIVIL APPEALS VACATED;ORDER OF WORKERS' COMPENSATION COURT REVERSED AND REMANDED WITH INSTRUCTIONS. ALL JUSTICES CONCUR. FOOTNOTES 1 Insurer asserts that arbitration was offered to Employee as a forum for dispute resolution but he declined. Apparently that offer was pursuant to this Tribal First provision. The contract between Insurer and the tribal enterprise mentions arbitration only "in relation to this Insurance (including disputes as to its validity, construction or enforceability), or for its breach." As to arbitration of a claim, the Provisions leave the decision to arbitrate solely with Insurer. If arbitration were pursued, however, presumably the applicable "law" would be the Tribal First Provisions. That "law" was crafted on behalf of the "Insurer," which the Provisions define to include the claims administrator. There is no Provision that describes where a party would seek judicial confirmation of such an arbitration award. 2 An adhesion contract is:a standardized contract prepared entirely by one party to the transaction for the acceptance of the other; such a contract, due to the disparity in bargaining power between the draftsman and the second party, must be accepted or rejected by the second party on a "take it or leave it" basis, without opportunity for bargaining and under such conditions that the "adherer" cannot obtain the desired product or service save by acquiescing in the form agreement. Rodgers v. Tecumseh Bank, 1988 OK 36, ¶ 14, 756 P.2d 1223, 1226 (quoting Steven v. Fid. & Cas. Co., 377 P.2d 284, 297 (Cal. 1963)). "Insurance contracts are generally recognized as one-sided when viewed under the circumstances at the time of contracting. Because of the disparity in the bargaining positions of the parties, these contracts of adhesion are interpreted consistent with the object sought to be accomplished . . .." Bratcher v. State Farm Fire & Cas. Co., 1998 OK 63, ¶ 9, 961 P.2d 828, 830 (footnote omitted). 3 The premiums in this policy were based on remuneration which included "payroll and all other remuneration paid or payable during the policy period for the services of: 1. all your officers and employees engaged in work covered by this policy . . .." 4 Additionally, "[a] contract made expressly for the benefit of a third person, may be enforced by him at any time before the parties thereto rescind it." Okla. Stat. tit. 15, § 29 (2011). 5 The insurance contract in this matter acknowledges the estoppel act and the employees' status as third party beneficiaries by providing: "We are directly and primarily liable to any person entitled to the benefits payable by this insurance. Those persons may enforce our duties; so may an agency authorized by law. Enforcement may be against us or against you and us." 6 "The Osage Nation government in exercising sovereign powers shall not: . . . deny to any person within its jurisdiction the equal protection of its laws or deprive any person of liberty or property without due process of law." Osage Nation Const. art. IV, § 3(H). 7 One general description of tribal immunity states: As a matter of black-letter law, "Indian tribes are immune from lawsuit or court process in both state and federal court unless 'Congress has authorized the suit or the tribe has waived its immunity.'" Felix S. Cohen, Cohen's Handbook of Federal Indian Law, 635 (Nell Jessup Newton et al. eds., LexisNexis Matthew Bender rev. ed. 2005)[hereinafter Cohen 2005 Handbook](quoting Kiowa Tribe v. Mfg. Technologies, Inc., 523 U.S. 751, 754 (1998)); See also Three Affiliated Tribes of the Fort Berthold Reservation v. Wold Eng'g, P.C., 476 U.S. 877, 890-891 (1986); Puyallup Tribe v. Dep't of Game, 433 U.S. 165, 172-173 (1977). A tribe's sovereign immunity extends to its commercial as well as governmental activities. Kiowa Tribe, 523 U.S. at 759. "Tribal sovereign immunity protects a tribal corporation owned by a tribe and created under its own laws, absent express waiver of immunity by the tribe or Congressional abrogation." Wright v. Colville Tribal Ent. Corp., 147 P.3d 1275, 1278 (Wash. 2006)(citing Kiowa Tribe, 523 U.S. at 754). State judicial jurisdiction over Indian tribes and tribal members in Indian country is generally precluded in the absence of express authorization by treaty or by Congress. Cohen 2005 Handbook at 521. "Indian country includes 'all lands set aside by whatever means for the residence of tribal Indians under federal protection, together with trust and restricted Indian allotments.'" Id. at 520 (quoting Okla. Tax Comm'n v. Sac & Fox Nation, 508 U.S. 114, 125 (1993)).Cossey v. Cherokee Nation Enters., 2009 OK 6, ¶ 2, 212 P.3d 447, 466-467 (Colbert, J. concurring specially).

40e87601-ec94-41a3-80b9-7232d19dc664

Zaloudek Grain Co. v. CompSource Oklahoma

oklahoma

Oklahoma Supreme Court

ZALOUDEK GRAIN COMPANY v. COMPSOURCE OKLAHOMA2012 OK 75Case Number: 110662Decided: 09/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ZALOUDEK GRAIN COMPANY, Plaintiff/Appellee, v. COMPSOURCE OKLAHOMA, Defendant/Appellant. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY HONORABLE BARBARA G. SWINTON DISTRICT JUDGE ¶0 Appeal of an April 13, 2012, Final Order granting summary judgment in favor of Plaintiff/Appellee, Zaloudek Grain Company and against Defendant/Appellant, CompSource Oklahoma. Plaintiff successfully argued Defendant wrongfully canceled its workers' compensation policy because it did not comply with subsection (C) of section 3639 of title 36 of the Oklahoma Statutes. Defendant asserts it properly canceled Plaintiff's workers' compensation policy pursuant to subsection (G) of section 64 of title 85 of the Oklahoma Statutes and subsection (C) of section 3639 is not applicable. We find subsection (C) of section 3639 of title 36 of the Oklahoma Statutes is not applicable to Defendant. We further find that Defendant is authorized to cancel a policy for an insured's failure to participate in the audit. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS Kerry R. Lewis and James D. Johnson, Rhodes, Hieronymus, Jones, Tucker & Gable, P.L.L.C., Tulsa, Oklahoma, for Defendant/Appellant. Richard E. Hornbeek, John E. Vitali, and Larry G. Cassil, Jr., Hornbeek Vitali & Braun, P.L.L.C., Oklahoma City, Oklahoma, for Plaintiff/Appellee. COMBS, J. ¶1 This is an appeal of the trial court's Final Order granting summary judgment in favor of the Plaintiff/Appellee, Zaloudek Grain Company (Zaloudek). Zaloudek claims its workers' compensation policy was unlawfully canceled by the Defendant/Appellant, CompSource Oklahoma (CompSource). CompSource argues it properly canceled Zaloudek's policy pursuant to subsection (G) of section 64 of title 85 of the Oklahoma Statutes 1 and subsection (C) of section 3639 of title 36 of the Oklahoma Statutes2 is not applicable to CompSource. FACTS AND PROCEDURAL HISTORY ¶2 Zaloudek held a workers' compensation policy with CompSource for approximately ten years prior to 2011. Zaloudek was required each year to provide payroll audit information to CompSource. The audit information is used to determine the proper premium for each year. CompSource sent a notice dated December 15, 2010, to Zaloudek requesting workers' compensation premium audit information. In January, 2011, Zaloudek's policy was renewed for the policy period January 1, 2011, through January 1, 2012. On January 18, 2011, CompSource sent another letter requesting Zaloudek provide the necessary payroll audit information by February 2, 2011. Upon not receiving the audit information, CompSource sent out a "courtesy notification" on February 4, 2011. This notification informed Zaloudek that the process of canceling its policy would begin if CompSource did not receive the audit information by February 16, 2011. The audit information was not provided and on February 16, 2011, CompSource sent a statutory "Notice of Pending Cancellation" stating Zaloudek's policy would be canceled effective March 3, 2011, at 12:01 a.m. It further informed Zaloudek that it could not apply for a new policy until an audit was completed on the canceled policy term. ¶3 On March 17, 2011, CompSource sent another letter advising Zaloudek that the policy had been canceled on March 3, 2011, and instructing Zaloudek how to reapply. CompSource made a credit refund to Zaloudek in the amount of $1342 on July 22, 2011.3 Six days later, CompSource faxed an application for workers' compensation insurance to Zaloudek. On August 4, 2011, two teenage workers were seriously injured in the grain auger at Zaloudek's facility. On the same day, Zaloudek mailed its application for workers' compensation coverage to CompSource. CompSource claims the application was received on August 5, 2011, and it was not accepted because the application was incomplete and was not signed by an owner of Zaloudek. The application contained the following standard provision "[c]overage will become effective 12:01 a.m. the day following acceptance of the properly signed application and receipt of the specified premium in our office." ¶4 Zaloudek filed its Petition on August 25, 2011, asking for a judgment against CompSource for breach of contract and bad faith and further requested declaratory relief in the form of an order requiring CompSource to provide workers' compensation coverage. On December 23, 2011, Zaloudek filed a motion for summary judgment claiming CompSource lacked legal justification for terminating its policy and requested orders to establish there was no lapse in coverage and requiring CompSource to provide coverage for its two injured employees. Zaloudek further requested a finding that CompSource was in breach of contract. ¶5 CompSource filed its response and cross-motion for summary judgment on January 11, 2012, requesting summary judgment and denial of Zaloudek's motion for summary judgment because Zaloudek was not covered at the time of the incident and its policy was properly canceled. Zaloudek filed a counter-motion for summary judgment asserting CompSource should be estopped from denying coverage because it retained premiums and acted in a manner toward Zaloudek consistent with continued coverage. On October 26, 2011, the trial court issued an order dismissing Zaloudek's bad faith claim but left pending its claims for breach of contract and declaratory relief. ¶6 On March 30, 2012, the trial court entered its Final Order whereby it granted Zaloudek's motion for summary judgment, denied CompSource's cross-motion for summary judgment, and found Zaloudek's counter-motion for summary judgment and its claim for equitable estoppel to be moot. The trial court ruled "1) 36 O.S. § 3639 applies to CompSource Oklahoma." The order further stated: …the Court finds there is no just reason for delay and this Court expressly directs the filing of a Final Order. 12 O.S. § 994(a). The Court further stays Plaintiff Zaloudek Grain Company's remaining claims and stays the enforcement of this Final Order pending the resolution of the appeal of the rulings contained herein. 12 O.S. § 994(b). This Court deems the language in the order as the functional equivalent of the certification required by section 952 of title 124 of the Oklahoma Statutes. We recast the petition in error as a petition for a writ of certiorari from a certified interlocutory order and grant the writ.5 STANDARD OF REVIEW ¶7 An appeal on summary judgment comes to this Court as a de novo review. Carmichael v. Beller, 1996 OK 48, ¶2, 914 P.2d 1051, 1053. On appeal, this Court assumes "plenary independent and non-deferential authority to reexamine a trial court's legal rulings." Kluver v. Weatherford Hospital Auth., 1993 OK 85, ¶14, 859 P.2d 1081, 1084. The question presented to us involves ascertainment of legislative intent which necessarily involves statutory construction. Statutory interpretation of a legal issue demands a de novo review standard.6 Basic rules of statutory interpretation are often utilized by this Court. In TRW/Reda Pump v. Brewington, 1992 OK 31, ¶5, 829 P.2d 15, 20, we stated: The primary goal of statutory construction is to ascertain and follow the intention of the Legislature. Ledbetter v Alcoholic Beverage Laws Enforcement Commission, 764 P.2d 172, 179 (Okla.1988). If a statute is plain and unambiguous and its meaning clear and no occasion exists for the application of rules of construction a statute will be accorded the meaning expressed by the language used. Berry v. Public Employees Retirement System, 768 P.2d 898, 899-900 (Okla.1989), quoting Caves Springs Public School District, 613 P.2d 1046, 1048 (Okla.1980). However, where a statute is ambiguous or its meaning uncertain it is to be given a reasonable construction, one that will avoid absurd consequences if this can be done without violating legislative intent. See Berry, supra at 900-901; Grand River Dam Authority v. State, 645 P.2d 1011, 1019 (Okla.1982). Further, the Legislature will not be presumed to have done a vain and useless act in the promulgation of a statute [Cunningham v. Rupp Drilling, Inc., 783 P.2d 985, 986 (Okla.Ct.App.1989) ], nor will an inept or incorrect choice of words be applied or construed in a manner to defeat the real or obvious purpose of a legislative enactment. Wooten v. Hall, 442 P.2d 334, 336 (Okla.1968). "The goal of statutory construction is always to follow legislative intent." Humphrey v. Denny, 1988 OK 69, ¶8, 757 P.2d 833, 835. "In ascertaining legislative intent the language of the entire act should be construed with a reasonable and sensible construction." Udall v. Udall, 1980 OK 99, ¶11, 613 P.2d 742, 745. "Legislative acts are to be construed in such manner as to reconcile the different provisions and render them consistent and harmonious, and give intelligent effect to each." Eason Oil Co. v. Corporation Commission, 1975 OK 14, ¶9, 535 P.2d 283, 286. This Court has found "legislative silence, when it has authority to speak, may be considered as giving rise to an implication of legislative intent." City of Duncan v. Bingham, 1964 OK 165, ¶12, 394 P.2d 456, 460. "Put simply, when called on to interpret a statute or ordinance a court's function given our tripartite system of government is to interpret or construe the applicable provision in an effort to expose the legislative will or intent and apply it to the applicable fact situation then extant, not to itself legislate or draft a law nor make policy decisions concerning the wisdom of what the legislative branch has enacted." Wylie v. Chesser, 2007 OK 81, ¶20, 173 P.3d 64, 72. ANAYLSIS I. THE APPLICABILITY OF TITLE 36 O.S. SUPP. 2007 § 3639 (C) TO COMPSOURCE ¶8 Zaloudek's main assertion is CompSource is not legally able to terminate a workers' compensation policy for mere failure to provide audit information. Zaloudek cites to section 3639 (C) which specifies what conditions must occur before a "licensed insurer or surplus or excess lines insurer" may cancel certain coverage.7 Cancelation for failure to provide audit information is not one of the listed conditions. ¶9 CompSource asserts section 3639 (C) is not applicable and that the provisions of the Oklahoma Insurance Code8 (Insurance Code) only apply to CompSource when CompSource is specifically referenced. Zaloudek does not allege CompSource is a surplus or excess lines insurer so our analysis will look at whether CompSource is a "licensed insurer" for purposes of this statute. ¶10 We find that CompSource is neither an "insurer" for purposes of section 3639 (C) nor is it licensed by the Insurance Commissioner. Therefore, section 3639 (C) does not apply to CompSource. ¶11 The record reflects the trial court found CompSource to be an insurer for purposes of section 3639 (C) based upon CompSource's inclusion in the definition of "insurance carrier" found in title 85. Section 3 of title 85 of the Oklahoma Statutes added CompSource to the definition of "insurance carrier."9 Section 3 is a definitions section and is prefaced with "[a]s used in the Workers' Compensation Act." The Workers' Compensation Act, now the Workers' Compensation Code, is entirely encompassed within title 85.10 This section specifically limits the use of those definitions to the Act and therefore such definitions are not applicable to the Insurance Code which is found in title 36. ¶12 Zaloudek also argues that CompSource is an insurer under the definition of "insurer" in the Insurance Code. Section 103 of the Insurance Code states that an "[i]nsurer includes every person engaged in the business of making contracts of insurance or indemnity." 11 "Person" is defined in section 104 as: "includes an individual, company, insurer, association, organization, society, reciprocal or inter-insurance exchange, partnership, syndicate, business trust, corporation, Lloyd's association, and entity, and association, group or department of underwriters and any farmer's educational and cooperative union."12 However, in order to have authority to transact insurance in Oklahoma under the Insurance Code an insurer must: be an incorporated stock insurer, an incorporated mutual insurer, a mutual benefit association, a nonprofit hospital service and medical indemnity corporation, a farmers mutual fire insurance association, a Lloyd's association or a reciprocal insurer, of the same general type as may be formed as a domestic insurer under this Code...13 ¶13 The State Insurance Fund (Fund) was created in 1933.14 CompSource is the successor to the Fund.15 The Fund was created to be a "revolving fund" for the purpose of insuring employers against liability for compensation under Oklahoma's workers' compensation laws.16 CompSource has been described by this Court as not being "an independent corporate entity or a governmental agency created by law and vested with a measure of governmental power, but a mere department created for a fixed and limited purpose, over which the state, through its Legislature and its officials, retains absolute domination and control."17 CompSource's employees are state employees and the President and Chief Executive Officer's salary is set by statute.18 It is a state department created for the purpose of insuring employers against liability for compensation pursuant to the Workers' Compensation Code and is required to be "fairly competitive with other insurance carriers."19 It is not an incorporated stock insurer, an incorporated mutual insurer, a mutual benefit association, a nonprofit hospital service and medical indemnity corporation, a farmers mutual fire insurance association, a Lloyd's association nor a reciprocal insurer. ¶14 The Fund/CompSource has been in existence for almost eighty years and yet the legislature has not added it to the list of entities in the Insurance Code's general definition of "insurer." This is so even though in 2010, as mentioned, the legislature amended the Workers' Compensation Act to include CompSource in the definition of "insurance carrier." References to CompSource in the Insurance Code further indicate the legislature's intent to distinguish it from "insurer" for purposes of the Code. For example, in subsection C of section 924.2 of the Code, CompSource is singled out from insurance companies. This subsection provides as follows: C. Eligible employers shall be those employers: 1. Who are insured by an insurance company writing workers' compensation insurance in this state; 2. Who are self-insured; or 3. Who are insured by CompSource Oklahoma. Another example is found in the Unfair Claims Settlement Practices Act (UCSPA) which is a part of the Insurance Code.20 The UCSPA's definition of "insurer" specifically includes CompSource for purposes of the Unfair Claims Settlement Practices Act.21 This definition only applies to the UCSPA and not the entire Insurance Code. If CompSource was considered by the legislature to fall under the general definition of "insurer" found in section 103 of the Insurance Code, then it would not be necessary to refer to it specifically in the UCSPA. Even though CompSource was included in the definition of "insurer" for the UCSPA other provisions of the UCSPA exclude CompSource when the legislature determined such provisions were only applicable to other UCSPA insurers.22 This further shows legislative intent to treat CompSource differently. ¶15 CompSource points out another example to show the legislature intended to treat CompSource as if it was not meant to be included in the Insurance Code's general definition of "insurer." The Insurance Code provides minimum requirements for the Insurance Commissioner to examine domestic insurers.23 It also requires insurers to submit annual financial statements to the Insurance Commissioner.24 However, such provisions concerning CompSource are separately provided for under the Workers' Compensation Code: CompSource Oklahoma shall submit to the State Insurance Commissioner an annual financial statement in the same manner as a domestic insurance carrier. The Insurance Commissioner may audit CompSource Oklahoma in the same manner as a domestic insurance company if an audit does not conflict with any specific provision contained herein. 85 O.S. Supp. 2002, § 139; renumbered as 85 O.S. 2011, §389 by 2011 Okla. Sess. Laws ch. 318, §88. CompSource argues section 139 would be a useless act if the legislature intended the definition of "insurer" in the Insurance Code to include CompSource. It asserts the only rational construction is that the legislature did not intend to include CompSource in that definition except to the extent it explicitly has done so. Essentially, they argue the Insurance Code only applies to CompSource when it specifically refers to CompSource. We agree. ¶16 The rational conclusion obtained from the legislature's silence in the general definition of "insurer" along with its specific treatment of CompSource in other parts of the Insurance Code is that the legislature intended for the provisions of the Insurance Code to only apply to CompSource when it specifically refers to CompSource. ¶17 When the Fund was established in 1933 the State Industrial Commission was vested with full power, authority and jurisdiction over the Fund.25 This power and authority extended to managing and conducting all business and affairs relating to The State Insurance Fund. The structure of The State Insurance Fund was later amended in 1937. A Board of Managers was created to oversee The State Insurance Fund.26 The Board was authorized to appoint a State Insurance Fund Commissioner (Commissioner). Both the Commissioner and its successor, the CompSource Oklahoma President and Chief Executive Officer, have statutorily been "vested with full power, authority and jurisdiction" over the Fund and CompSource respectively.27 ¶18 Section 3639 (C) applies to a "licensed insurer." A license grants authority to perform a certain act or acts. The license referred to in section 3639 (C) can only mean one granted by the Insurance Commissioner to transact the business of insurance in this state. Section 606(A) of Title 36 of the Oklahoma Statutes provides "[n]o person shall act as an insurer and no insurer shall transact insurance in Oklahoma except as authorized by a subsisting authority granted to it by the Insurance Commissioner, except as to such transactions as are expressly otherwise provided for in this Code."28 Section 109 of the Insurance Code further states "[n]o person shall transact a business of insurance in Oklahoma without complying with the applicable provisions of this Code."29 Neither of these sections is applicable to CompSource because it derives its authority to provide workers' compensation insurance from sections in the Workers' Compensation Code and not from the Insurance Commissioner nor the Insurance Code.30 Therefore, CompSource is also not "licensed" by the Insurance Commissioner because its authority is founded in the Workers' Compensation Code and is not dependent upon the Insurance Commissioner or the Insurance Code.31 CompSource is not a "licensed insurer" for purposes of section 3639 (C) and therefore section 3639 (C) is not applicable to CompSource. II. COMPSOURCE'S CANCELATION OF ZALOUDEK'S POLICY ¶19 CompSource asserts it properly canceled Zaloudek's workers' compensation policy pursuant to subsection (G) of section 64 of title 85 of the Oklahoma Statutes which provides in relevant part: G. No contract of insurance issued by a stock company or mutual association or other concern against the liability arising under this act shall be canceled within the time limited in such contract for its expiration until at least ten (10) days after notice of intention to cancel such contract, on a date specified in such notice, shall be filed in the office of the Administrator and also served on the employer. Such notice shall be served on the employer by delivering it to the employer or by sending it by mail, by registered letter, addressed to the employer at the employer's last-known place of residence; provided that, if the employer is a partnership, then such notice may be so given to any one of the partners, and if the employer is a corporation, then the notice may be given to any agent or officer of the corporation upon whom legal process may be served… Zaloudek argues § 64(G) is only a notice provision and CompSource is only able to cancel a policy for one of the eight reasons found in section 3639 (C). As mentioned earlier, we find that section 3639(C) is not applicable to CompSource so the question therefore becomes whether CompSource may properly cancel a workers' compensation policy because an insured failed to participate in the audit. We hold that it may. ¶20 Section 142 of title 85 of the Oklahoma Statutes32 requires the premiums for any policy period to be paid to CompSource and adjusted according to the contract of insurance. It provides as follows: Premiums for any policy period shall be paid into CompSource Oklahoma and adjusted according to the contract of insurance. If such adjusted premium is more than the premium paid at the beginning of the period, the employer shall pay the difference immediately upon notification of the amount of premium due. If such adjusted premium is less than the premium paid at the beginning of the period, the employer shall at the employer's option receive either refund of the difference or a credit of the amount thereof on the employer's account with CompSource Oklahoma. CompSource asserts the audit is necessary in order to make the required adjustment of premium. Paragraph 5 of subsection A of section 134 of title 85 of the Oklahoma Statutes33 grants CompSource the authority "[t]o inspect and audit, cause to be inspected and audited, or require production of the records of employers insured with or applying for insurance with CompSource Oklahoma against liability for compensation." CompSource argues that the only proper way to satisfy the section 142 mandate is to condition cancelation on receiving audit information. We agree with CompSource's interpretation especially considering the legislature has authorized CompSource to cancel a policy of insurance if an insured defaults in the payment "required to be made" to CompSource.34 CompSource depends upon the audit information to determine required payments. If the insured fails to provide audit information then CompSource has no way to 1) determine if a "default in the payment required to be made" has occurred and 2) make the premium adjustments mandated by section 142. ¶21 In its final order the trial court found Zaloudek's counter-motion for summary judgment and its claims for equitable estoppel to be moot based upon its finding that section 3639 (C) applies to CompSource. We reverse the trial court's ruling on section 3639 (C)'s applicability. The trial court stayed Zaloudek's remaining claims pending this appeal. In its counter-motion for summary judgment Zaloudek alleges it sent the requested audit information prior to the March 3, 2011, cancelation of its policy. On this appeal we have reviewed only issues of law. We do not rule today as to whether or not CompSource properly canceled Zaloudek's policy. Those issues remain for the trial court's determination upon remand. Our holding determines CompSource is authorized to cancel a policy based upon an insured's failure to participate in the audit. CONCLUSION ¶22 For the above stated reasons, we find section 3639 (C) does not apply to CompSource and CompSource is authorized to cancel a policy for an insured's failure to participate in the audit. All other issues are remanded for further proceedings in the trial court. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS ¶23 TAYLOR, C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, REIF, COMBS and GURICH, JJ., concur. ¶24 COLBERT, V.C.J., concurs in result. FOOTNOTES 1 Citations in this opinion are made to the law in effect at the time of the cancelation of the Zaloudek policy, March 3, 2011, unless otherwise indicated. 85 O.S. Supp. 2006, § 64(G) was repealed by 2011 Okla. Sess. Laws ch. 318, § 87; the language of this section was then codified in a new section of law, 85 O.S. 2011, § 356, by 2011 Okla. Sess. Laws ch. 318, § 56. 2 36 O.S. Supp. 2007, § 3639 (C). 3 The credit refund was made pursuant to 85 O.S. 2001, § 67.1, which was repealed effective August 26, 2011, by 2011 Okla. Sess. Laws ch. 318, § 87, but was in effect for the period relevant to this case. § 67.1 provided as follows: [i]f any insurance company shall cancel any policy of Workers' compensation insurance issued by it upon risks within this state, the premium or consideration therefor, or any part thereof having been actually paid, it shall, within one hundred eighty (180) days after the effective date of said cancellation, make an audit of the payroll of such risk to determine the portion of said premium or consideration which has been earned and the portion thereof which has not been earned, respectively, and furnish a copy of said audit to the policyholder and return, within a reasonable time after the effective date of such cancellation, the unearned portion of the premium or consideration actually paid, said company retaining only the pro rata part thereof. 4 12 O.S. 2011, § 952, provides as follows: (a) The Supreme Court may reverse, vacate or modify judgments of the district court for errors appearing on the record, and in the reversal of such judgment may reverse, vacate or modify any intermediate order involving the merits of the action, or any portion thereof. (b) The Supreme Court may reverse, vacate or modify any of the following orders of the district court, or a judge thereof: 1. A final order; 2. An order that discharges, vacates or modifies or refuses to vacate or modify a provisional remedy which affects the substantial rights of a party; or grants, refuses, vacates, modifies or refuses to vacate or modify an injunction; grants or refuses a new trial; or vacates or refuses to vacate a final judgment; 3. Any other order, which affects a substantial part of the merits of the controversy when the trial judge certifies that an immediate appeal may materially advance the ultimate termination of the litigation; provided, however, that the Supreme Court, in its discretion, may refuse to hear the appeal. If the Supreme Court assumes jurisdiction of the appeal, it shall indicate in its order whether the action in the trial court shall be stayed or shall continue. The failure of a party to appeal from an order that is appealable under either subdivision 2 or 3 of subsection (b) of this section shall not preclude him from asserting error in the order after the judgment or final order is rendered. 5 See In The Matter Of The Application Of Eaton Enterprises, 2003 OK 14, ¶4, 65 P.3d 277, 279. 6 Barnhill v. Multiple Inj. Trust Fund, 2001 OK 114, ¶8, 37 P.3d 890, 894. 7 36 O.S. Supp. 2007, § 3639 (C), provides as follows: After coverage has been in effect for more than forty-five (45) business days or after the effective date of the renewal of a commercial marine, commercial automobile, commercial property, commercial casualty or commercial fire insurance policy, a notice of cancellation shall not be issued by any licensed insurer or surplus or excess lines insurer unless it is based on at least one of the following reasons with at least ten (10) days notice to the insured: 1. Nonpayment of premium; 2. Discovery of fraud or material misrepresentation in the procurement of the insurance or with respect to any claims submitted thereunder; 3. Discovery of willful or reckless acts or omissions on the part of the named insured which increase any hazard insured against; 4. The occurrence of a change in the risk which substantially increases any hazard insured against after insurance coverage has been issued or renewed; 5. A violation of any local fire, health, safety, building, or construction regulation or ordinance with respect to any insured property or the occupancy thereof which substantially increases any hazard insured against; 6. A determination by the Commissioner that the continuation of the policy would place the insurer in violation of the insurance laws of this state; 7. Conviction of the named insured of a crime having as one of its necessary elements an act increasing any hazard insured against; or 8. Loss of or substantial changes in applicable reinsurance. 8 The Oklahoma Insurance Code is comprised of all of title 36 of the Oklahoma Statutes. 36 O.S. 2001, § 101. 9 85 O.S. Supp. 2010, §3, was repealed by 2011 Okla. Sess. Laws ch. 318, §87, but was also codified into a new section of law 85 O.S. 2011, § 308, by the same act, 2011 Okla. Sess. Laws ch. 318, §8. 10 The Workers' Compensation Act was renamed the Workers' Compensation Code by 2011 Okla. Sess. Laws ch. 318, §1. It now encompasses §§301 to 413 of title 85 of the Oklahoma Statutes. 11 36 O.S. 2001, § 103. 12 36 O.S. Supp. 2004, § 104. 13 36 O.S. 2001, § 607. 14 1933 Okla. Sess. Laws ch.28, §1. 15 In 2001, the legislature changed the name to CompSource Oklahoma; 2001 Okla. Sess. Laws ch. 378, §1. 16 1933 Okla. Sess. Laws ch.28, §1. 17 O.K. Constr. Co. v. Burwell, 1939 OK 248, ¶10; 93 P.2d 1092, 1094. 18 74 O.S. Supp. 2009, § 840-5.10 and 74 O.S. Supp. 2010, § 3601.2. 19 85 O.S. Supp. 2002, § 131; renumbered as 85 O.S. 2011, § 375 by 2011 Okla. Sess. Laws ch. 318, §88. 20 36 O.S. §§ 1250.1 through 1250.16. 21 36 O.S. Supp. 2009, § 1250.2 (7), provides as follows: "Insurer" means a person licensed by the Commissioner to issue or who issues any insurance policy or insurance contract in this state, including Compsource, and also includes health maintenance organizations. Provided that, for the purposes of paragraphs 15 and 16 of Section 1250.5 of this title, 'insurer' shall include the State and Education Employees Group Insurance Board; 22 36 O.S. Supp. 2010, § 1250.4 (A), provides as follows: "An insurer's claim files, other than the claim files of the State Insurance Fund, shall be subject to examination by the Insurance Commissioner…"; 36 O.S. 2001, § 1250.11 (B), provides as follows: "The Insurance Commissioner shall not assert enforcement jurisdiction pursuant to this section over the State Insurance Fund."; and 36 O.S. 2001, § 1250.13 (A), provides as follows: "The Insurance Commissioner, upon finding an insurer, other than the State Insurance Fund, in violation of any provision of the Unfair Claims Settlement Practices Act, shall issue a cease and desist order to said insurer directing it to stop such unlawful practices." 23 36 O.S. Supp. 2009, § 309.2, provides as follows: A. The Insurance Commissioner or an examiner may conduct an examination, including a financial and market conduct examination, under Sections 309.1 through 309.7 of this title of any company as often as the Commissioner deems appropriate but shall at a minimum, conduct a financial examination of every domestic insurer licensed in this state not less frequently than once every three (3) years… 24 36 O.S. Supp. 2004, § 311 (A) (1), provides as follows: "…Domestic insurers shall file a printed annual financial statement along with all supplement filings in the office of the Insurance Commissioner annually on or before the first day of March." 25 1933 Okla. Sess. Laws ch. 28, §2-3. 26 1937 Okla. Sess. Laws ch. 72, § 1. 27 1937 Okla. Sess. Laws ch. 72, §4 and 85 O.S. Supp. 2002, § 132; renumbered as 85 O.S. 2011, § 379 by 2011 Okla. Sess. Laws ch. 318, §88. 28 36 O.S. 2001, § 606 (A). 29 36 O.S. 2001, § 109. 30 1) 85 O.S. Supp. 2002, § 132; renumbered as 85 O.S. 2011, § 379 by 2011 Okla. Sess. Laws, ch. 318, §88, provides as follows: The CompSource Oklahoma President and Chief Executive Officer is hereby vested with full power, authority and jurisdiction over CompSource Oklahoma. He or she shall perform any duties which are necessary or convenient in the exercise of any power, authority, or jurisdiction over the fund in the administration thereof, or in connection with the insurance business to be carried on by him or her under the provisions of Sections 131 through 151 of this title as fully and completely as a governing body of a private insurance carrier might or could do including the acquisition, operation and maintenance of an electronic data processing facility. The Board of Managers of CompSource Oklahoma shall have full power and authority to fix and determine the rates to be charged by CompSource Oklahoma for insurance. 2) 85 O.S. Supp. 2006, § 133; renumbered as 85 O.S. 2011, § 381by 2011 Okla. Sess. Laws ch. 318, § 88, provides as follows: The CompSource Oklahoma President and Chief Executive Officer shall have full power and authority to manage and conduct all business and affairs relating to CompSource Oklahoma, all of which business and affairs shall be conducted under the name of CompSource Oklahoma, and in that name and without any other name or title, the CompSource Oklahoma President and Chief Executive Officer may: (1) Sue and be sued in all the courts of the state, in all actions arising out of any act, deed, matter or things made, omitted, entered into, done or suffered in connection with CompSource Oklahoma, and administer, manage, or conduct all the business and affairs relating thereto. (2) Make and enter into contracts of insurance as herein provided, and such other contracts or obligations relating to CompSource Oklahoma, as are authorized or permitted under the provisions of this title, including contracting with or appointing agents or brokers; provided the agents or brokers do not contract with or have an appointment solely with CompSource Oklahoma… (4) Conduct all business and affairs, relating to CompSource Oklahoma, whether herein specifically designated or in addition thereto… 3) 85 O.S. Supp. 2008, § 134; renumbered as 85 O.S. 2011, § 382 by 2011 Okla. Sess. Laws ch. 318, § 88, provides as follows: A. In conducting the business and affairs of CompSource Oklahoma, the CompSource Oklahoma President and Chief Executive Officer, or other officer to whom such power and authority may be delegated by the CompSource Oklahoma President and Chief Executive Officer, as provided by Section 133 of this title, shall have full power and authority: 1. To enter into contracts of insurance, insuring employers against liability for compensation, and insuring to employees and other persons entitled thereto compensation as provided by the Workers' Compensation Act, Section 1 et seq. of this title; 2. To decline to insure any risk in which the minimum requirements of the law with regard to construction, equipment and operation are not observed, or which is beyond the safe carrying of CompSource Oklahoma, but shall not have power or authority, except as otherwise provided in this act to refuse to insure any compensation risk tendered with the premium therefor; 3. To enter into contracts of insurance insuring persons, firms and corporations against loss, expense or liability by reason of bodily injury, death by accident, occupational disability, or occupational disease suffered by employees for which the insured may be liable or have assumed liability, including, but not limited to, contracts of insurance or reinsurance for the purpose of insuring employers operating in this state and their employees who may work outside this state; 4. To purchase reinsurance for any risk or any portion of any risk of CompSource Oklahoma. The purchase of reinsurance may be made through intermediaries, exclusive of the provisions of The Oklahoma Central Purchasing Act; 5. To inspect and audit, cause to be inspected and audited, or require production of the records of employers insured with or applying for insurance with CompSource Oklahoma against liability for compensation; 6. To contract with physicians, surgeons and hospitals for medical and surgical treatment and the care and nursing of injured persons entitled to benefits from said fund; 7. To meet the reasonable expenses of conducting the business of CompSource Oklahoma; 8. To produce a reasonable surplus to cover catastrophe hazard; and 9. To administer a program in compliance with Section 924.3 of Title 36 of the Oklahoma Statutes, whereby employers may appeal rating classification decisions which are disputed. CompSource Oklahoma shall notify employers of the availability of the program. 31 Zaloudek claims that CompSource is licensed by the Insurance Department based upon its inclusion in a list of licensed insurers obtained from the Insurance Department's website. However, upon closer inspection this same website states that "[p]lease note, the Oklahoma Insurance Department does not have regulatory authority over CompSource." (http://www.ok.gov/oid/faqs.html, paragraph 2, under the heading "Workers' Compensation" as of June 28, 2012). 32 85 O.S. Supp. 2002, §142; renumbered as 85 O.S. 2011, § 391 by 2011 Okla. Sess. Laws c. 318, § 88. 33 85 O.S. Supp. 2008, § 134; renumbered as 85 O.S. 2011, § 382 by 2011 Okla. Sess. Laws ch. 318, § 88. 34 85 O.S. 2001, § 144; renumbered as 85 O.S. 2011, § 393 by 2011 Okla. Sess. Laws ch. 318, § 88. This section provides as follows: If any persons, firm or corporation insured by said State Insurance Fund shall default in the payment required to be made by him to the State Insurance Fund, after due notice his insurance in "The State Insurance Fund" may be canceled and the amount due from him shall be collected by a civil action against him in the name of "The State Insurance Fund", and the same when collected shall be paid into "The State Insurance Fund", and such insured's compliance with the provisions of this article requiring payments to be made to the "State Insurance Fund" shall date from the time of the payment of such money so collected as aforesaid to "The State Treasurer" for credit of "The State Insurance Fund".

36b77db7-9bfe-41a3-ac56-7709bd5c7cca

U.S. Bank National Ass'n v. Baber

oklahoma

Oklahoma Supreme Court

U.S. BANK NATIONAL ASSOCIATION v. BABER2012 OK 55Case Number: 109942Decided: 06/12/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. U.S. BANK NATIONAL ASSOCIATION, As TRUSTEE of the SECURITY NATIONAL MORTGAGE LOAN TRUST 2006-1, Plaintiff/Appellee,v.BILLY G. BABER a/k/a BILLY GENE BABER and JEANETTE BABER, a/k/a AGNES J. BABER a/k/a A. JEANETTE BABER, Defendants/Appellants,andMORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AS NOMINEE FOR GOLD MORTGAGE BANC, INC., AMERIQUEST MORTGAGE COMPANY and MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. Defendants. ON APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTYHONORABLE PATRICIA G. PARRISHDISTRICT JUDGE ¶0 Appeal of a summary judgment and motion to vacate granted in U.S. Bank Association's favor against Billy G. Baber and Jeanette Baber, husband and wife (hereinafter "Appellants"), on March 18, 2011. The Babers appeal this summary judgment, and motion to vacate. REVERSED AND REMANDED WITH INSTRUCTIONS MaryGaye LeBoeuf , Oklahoma City, Oklahoma, for Defendants/Appellants Billy G. Baber and Jeanette Baber.Melvin R. Mcvay and Raymond E. Zschiesche, Phillips McFall McCaffrey McVay & Murrah, PC, Oklahoma City Oklahoma for Plaintiff/Appellee U.S. Bank, N.A.Scott Peck, Peck, Erodes & Wenzel, P.A., Oklahoma City for Plaintiff/Appellee U.S. Bank, N.A. COMBS, J. FACTUAL BACKGROUND AND PROCEDURAL HISTORY ¶1 On February 22, 2005, Appellants executed a promissory note (hereinafter "Note") payable to Ameriquest Mortgage Company, Inc. (hereinafter "Lender"). To secure payment of the Note, Appellants executed and delivered to Mortgage Electronic Registration Systems, Inc. (MERS), as nominee for Lender, as mortgagee, a certain mortgage (hereinafter "Mortgage"), which conveyed and mortgaged to the mortgagee certain real property located in Oklahoma County, Oklahoma. In both the Note and Mortgage, Ameriquest Mortgage Company is named as the Lender and Payee. Appellants defaulted on the Note. Appellee initiated foreclosure proceedings on November 6, 2006. A copy of the non-indorsed Note and Mortgage was included with the petition. ¶2 In their answer, Appellants demanded strict proof of the ownership of the Note and Mortgage.1 Appellee moved for summary judgment on August 31, 2009. In an attached affidavit, Appellee asserted it currently held both the Note and Mortgage at issue, and again produced a copy of both the unindorsed Note and Mortgage. ¶3 The final Journal Entry of Judgment was filed on March 18, 2011 granting judgment on the note and foreclosing the mortgage lien in favor of U.S. Bank Association, as Trustee. The Babers filed a motion to vacate the judgment on April 4, 2011 arguing they were denied their statutory right to respond to U.S. Bank NA's Cross-Motion for Summary Judgment in violation of statute and rule, that the motion was not delivered to them in a timely fashion and that they did not receive notice of the hearing that occurred on September 5, 2010. STANDARD OF REVIEW ¶4 The standard of review2 for a trial court's ruling either vacating or refusing to vacate a judgment is abuse of discretion. Ferguson Enterprises, Inc. v. Webb Enterprises, Inc., 2000 OK 78, ¶ 5, 13 P.3d 480, 482; Hassell v. Texaco, Inc., 1962 OK 136, 372 P.2d 233. A clear abuse-of-discretion standard includes appellate review of both fact and law issues. Christian v. Gray, 2003 OK 10, ¶ 43, 65 P.3d 591, 608. An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law, or where there is no rational basis in evidence for the ruling. Fent v. Oklahoma Natural Gas Co., 2001 OK 35, ¶12; 27 P.3d 477, 481 ¶5 Following the teachings of Deutsche Bank National Trust v. Brumbaugh, 2012 OK 3, ___ P.3d ____, ¶11, where we held: To commence a foreclosure action in Oklahoma, a plaintiff must demonstrate it has a right to enforce the note and, absent a showing of ownership, the plaintiff lacks standing. Gill v. First Nat. Bank & Trust Co. of Oklahoma City, 1945 OK 181, 159 P.2d 717. Being a person entitled to enforce the note is an essential requirement to initiate a foreclosure lawsuit. In the present case, there is a question of fact as to when Appellee became a holder, and thus, a person entitled to enforce the note. Therefore, summary judgment is not appropriate. If Deutsche Bank became a person entitled to enforce the note as either a holder or nonholder in possession who has the rights of a holder after the foreclosure action was filed, then the case may be dismissed without prejudice and the action may be re-filed in the name of the proper party. We reverse the granting of summary judgment by the trial court and remand back for further determinations as to when Appellee acquired its interest in the note. See also, Deutsche Bank v. Matthews, 2012 OK 14, , ___ P.3d ____; Deutsche Bank v. Richardson, 2012 OK 15, ___ P.3d ____;and J.P. Morgan v. Eldridge, 2012 OK 24, ___ P.3d ____. In the present matter U.S. Bank, N.A., as Trustee filed a non-indorsed copy of the note at every step of the proceedings.3 We therefore find there is a question of fact as to when U.S. Bank N.A., as Trustee, acquired the note in the instant matter, and we remand this matter back to the trial court for further determination as to if and when U.S. Bank N.A., as Trustee became a person entitled to enforce the note. CONCLUSION ¶6 It is a fundamental precept of the law to expect a foreclosing party to actually be in possession of its claimed interest in the note, and to have the proper supporting documentation in hand when filing suit, showing the history of the note, so that the defendant is duly apprised of the rights of the plaintiff. This is accomplished by showing the party is a holder of the instrument or a nonholder in possession of the instrument who has the rights of a holder, or a person not in possession of the instrument who is entitled to enforce the instrument pursuant to 12A O.S. 2001, § 3-309 or 12A O.S. 2001, § 3-418. Likewise, for the homeowners, absent adjudication on the underlying indebtedness, the dismissal cannot cancel their obligation arising from an authenticated note, or insulate them from foreclosure proceedings based on proven delinquency and, therefore, this Court's decision in no way releases or exonerates the debt owed by the defendants on this home. See, U.S. Bank National Association v. Kimball 27 A.3d 1087, 75 UCC Rep.Serv.2d 100, 2011 VT 81 (VT 2011); and Indymac Bank, F.S.B. v. Yano-Horoski, 78 A.D.3d 895, 912 N.Y.S.2d 239 (2010) REVERSED AND REMANDED WITH INSTRUCTIONS ¶7 CONCUR: TAYLOR, C.J., KAUGER, WATT, EDMONDSON, REIF, COMBS, JJ. ¶8 CONCUR IN PART; DISSENT IN PART: WINCHESTER (JOINS GURICH, J.), GURICH (BY SEPARATE WRITING), JJ. ¶9 RECUSED: COLBERT, V.C.J. FOOTNOTES 1 Also at issue was an alleged scriveners error which placed the mortgage lien on land not occupied by the house for which the note and mortgage was allegedly executed. The trial court reformed the mortgage to reflect the legal description asserted by Appellee as the correct tract of land to be encumbered by the mortgage lien, originally executed by the Appellants. This order was filed on November 19, 2010. 2 Summary judgment decisions are reviewed de novo, Carmichael v. Beller, 1996 OK 48, ¶ 2, 914 P.2d 1051, 1053, whereas orders denying or granting a petition to vacate are reviewed for an abuse of discretion, Patel v. OMH Medical Center, Inc., 1999 OK 33 at ¶ 20. 3 Since this matter is being remanded on the issue of standing, we therefore will not address the issues raised by the Baber's as they again will have opportunity for all issues, including but not limited to the issue of reformation of the mortgage to be address again in District Court. GURICH, J., with whom WINCHESTER, J. joins concurring in part and dissenting in part: ¶1 I concur that summary judgment was improper in this case because the trial court failed to allow Defendants time to respond to Plaintiff's cross-motion for summary judgment,1 and the Defendants did not receive notice that the Plaintiff had taken a default judgment for reformation and foreclosure against the other defendants in the case. However, because the majority reverses solely on the issue of standing, I respectfully dissent for the reasons stated in my dissenting opinions in Deutsche Bank National Trust Co. v. Matthews, 2012 OK 14, ___P.3d___ (Gurich, J., dissenting) and Bank of America, NA v. Kabba, 2012 OK 23, ___P.3d___ (Gurich, J., dissenting).2 FOOTNOTES 1 See Rule 13, Rules for District Courts of Oklahoma, 12 O.S. Ch. 2, App. In this case, the Defendants filed a motion for summary judgment. Two days before the hearing on Defendants' motion for summary judgment, the Plaintiff filed a response and a cross-motion for summary judgment. Without giving the Defendants an opportunity to respond to Plaintiff's cross-motion for summary judgment, the trial court held a hearing on both the Defendants' motion for summary judgment and the Plaintiff's cross-motion for summary judgment. 2 Although I originally concurred in the majority opinion in Deutsche Bank National Trust v. Brumbaugh, 2012 OK 3, ___P.3d___, after further consideration, I disagree with the majority's analysis in that case, and my views on the issues in these cases are accurately reflected in J.P. Morgan Chase Bank N.A. v. Eldridge, 2012 OK 24, ___P.3d___ (Gurich, J., concurring in part and dissenting in part); Kabba, 2012 OK 23, ___P.3d___ (Gurich, J., dissenting); CPT Asset Backed Certificates, Series 2004-EC1 v. Kham, 2012 OK 22, ___P.3d___ (Gurich, J., dissenting); Deutsche Bank National Trust Co. v. Richardson, 2012 OK 15, ___P.3d___ (Gurich, J., concurring in part and dissenting in part); and Matthews, 2012 OK 14, ___P.3d___ (Gurich, J., dissenting).

df6cdd81-2540-4e8c-ba90-4489607a9ba2

Oklahoma v. Price

oklahoma

Oklahoma Supreme Court

STATE v. PRICE2012 OK 51Case Number: 109039Decided: 06/05/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. In the Matter of Pawnee County Grand Jury: STATE OF OKLAHOMA, Plaintiff/Appellee, v. ROGER LEE PRICE, Defendant/Appellant. APPEAL FROM PAWNEE COUNTY DISTRICT COURT GRAND JURY PROCEEDINGS OUSTING OF ELECTED OFFICIAL Honorable P. Thomas Thornbrugh, Trial Judge ¶0 The appellant, State of Oklahoma, pursuant to Grand Jury Proceedings in Pawnee County, Oklahoma, accused the appellant, Roger Lee Price, the elected Sheriff of Pawnee County, (Price/sheriff) of wilful neglect of duty and sought his removal from office. A jury trial was held and the jury unanimously determined that Price was guilty of two accusations of wilful neglect of duty. Pursuant to the jury verdict, the trial judge, Honorable P. Thomas Thornbrugh, ordered that the Sheriff be removed from office. Price filed a motion for a new trial which the trial court denied. Price appealed alleging numerous errors and this Court retained the appeal. We consolidate the issues and hold that: 1) there was no error under the facts presented in allowing the State to prove only two of the three alleged acts of wilful conduct when seeking removal of the sheriff; 2) the trial court properly modified the proposed jury instructions to conform to the evidence presented; and 3) the trial court did not err in denying the motion for a demurrer to the evidence/directed verdict. MOTION TO RETAIN PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED. Danny G. Lohmann, Assistant District Attorney, Fairview, Oklahoma, for Plaintiff/Appellee. Stanley D. Monroe, Stephen G. Layman, Tulsa, Oklahoma, for Defendant/Appellant. KAUGER, J.: ¶1 The three issues presented on certiorari are1 whether the trial court: 1) properly allowed the State to prove two of the three factually alleged inappropriate acts in the grand jury's accusation for removal of an elected state official from office for wilful neglect of duty; 2) improperly modified the jury instructions regarding wilful neglect of duty; and 3) erred in denying the motion for a demurrer to the evidence/directed verdict. ¶2 We hold that:1) there was no error under the facts presented in allowing the State to prove only two of the three alleged acts of wilful conduct when seeking removal of the sheriff; 2) the trial court properly modified the proposed jury instructions to conform to the evidence presented; and 3) the trial court did not err in denying the motion for a demurrer to the evidence/directed verdict. FACTS ¶3 The voters of Pawnee County, Oklahoma, elected the defendant/appellant, Roger Lee Price (Price/sheriff), Sheriff of Pawnee County. He first assumed office in January of 2005. By 2010, District Judge Jefferson Sellers requested a grand jury be convened regarding the sheriff's conduct. In September of 2010, the grand jury convened and, on September 29, 2010, it filed an "Accusation for Removal" in the District Court of Pawnee County. ¶4 The grand jury determined that Price knowingly, wilfully, and unlawfully committed misconduct in office through acts of wilful neglect of duty.2 One act was alleged to have occurred on September 11, 2006. It involved a female prisoner whom the sheriff released from jail without any bond or judicial authorization in violation of 21 O.S. 2011 §532.3 ¶5 Another act was alleged to have occurred on July 25, 2007, when a person who was being sought on an arrest warrant issued by the trial court attempted to surrender himself at the Pawnee County Jail. Under the sheriff's direction, the suspect was turned away and was not booked into the jail in violation of 21 O.S. 2011 §533.4 A third act was also alleged but this allegation was later dropped/not pursued by the State. ¶6 On September 29, 2010, the District Judge, pursuant to 22 O.S. 2011 §1195 suspended Price from office, pending a jury trial of the accusations.5 The trial was held on November 1-3, 2010. At the conclusion of the trial, a unanimous jury found the sheriff guilty of wilful neglect of duty for his conduct involving each of the alleged acts. Consequently, the trial court entered a final order and judgment on November 10, 2010, pursuant to 22 O.S. 2011 §1192,6 removing the sheriff from office effective immediately. Price filed a motion for new trial which the trial court denied in an order filed on December 7, 2010. ¶7 The sheriff appealed on December 27, 2010. We retained the cause on February 15, 2011, before the briefing cycle was complete. The briefing cycle was completed on September 27, 2011, but the trial court record delivered to the Court did not contain the trial transcripts of the November 2010 trial as designated by Price. The trial transcripts were finally received by this Court on March 29, 2012.7 ¶8 I. THERE WAS NO ERROR UNDER THE FACTS PRESENTED IN ALLOWING THE STATE TO PROVE ONLY TWO OF THE THREE ALLEGED ACTS OF WILFUL CONDUCT WHEN SEEKING REMOVAL OF THE SHERIFF. ¶9 The accusation for removal states three different acts or incidences/offenses which were the basis of the allegations of misconduct.8 Price argues that the grand jury intended that all three allegations be considered together as the basis for removal. He argues that all three acts taken together must support the wrongful conduct for removal from office, or there is no basis at all to support any wrongdoing. Consequently, Price insists that the trial court erred in allowing the State to sever and eliminate one of the allegations on the eve of trial. The State, relying on the civil nature of the indictment process and pleadings contends that the sheriff's argument is meritless. We agree. ¶10 The Oklahoma Criminal Code, 22 O.S. 2011 ch. 23, provides the procedure to remove an elected official from office. The proceedings are governed pursuant to 22 O.S. 2011 §§1181-97,9 and removal proceedings are jury trials conducted as a misdemeanor criminal trial.10 Nevertheless, this Court has recognized that removal proceedings are not to be judged as strictly as a criminal indictment. 11 ¶11 Historically grand jury accusations have been divided into separate counts much like a criminal indictment. For example, in Bowles v. State, 1923 OK 226, 215 P. 934, the State sought removal of the mayor of the city of Durant pursuant to a grand jury accusation of wilful neglect of duty. The accusation contained five separate counts of various offenses. During the trial, the trial court ruled in favor of a demurrer to the evidence concerning two counts, leaving three remaining counts for the jury to decide. The jury found the mayor guilty of one of the alleged counts. The mayor was removed from office for failing to file statutorily required monthly reports detaining fines and costs collected by the City. ¶12 In Hutchison v. State, 1957 OK 300, 318 P.2d 885, four separate counts were alleged against the county attorney which included: 1) habitual and wilful neglect of duty; 2) gross partiality in office; 3) corruption in office; and 4) wilful maladministration. Under each count various "charges" or "acts" of misconduct were alleged. The jury found the attorney guilty of gross partiality in office. ¶13 However, in State v. Scarth, 1931 OK 561, 3 P.2d 446, in the attempted removal of a board of county commissioner, the Court, relying on examples from California and North Dakota and noting support from other jurisdictions as well, explained in ¶¶8-9 that: 1) an accusation of a public officer for offenses brought for the purpose of removal was not an indictment and was not objectionable on the grounds that it contained more than one offense; 2) such an action is neither civil nor criminal, but a special practice to protect the public from corrupt officials; 3) the purpose is not to punish the offender as the case would be in a criminal prosecution for a crime; 4) due process is provided within the statutes governing the proceeding; 5) a defendant cannot stand on the technicalities which have been or may be devised in the testing and trial of a criminal indictment; and 6) unlike a criminal charge, there is no arrest, bail, fine or imprisonment, merely a speedy, accessible relief, on behalf of the people who have elected the official who is charged. The Court concluded that a proceeding to remove an official from office is a special proceeding.12 It also noted that the statutes for removal specify the procedure leading up to trial and where the procedure is not fully explicit, the civil procedure used by the courts is invoked. These cases predate the rules of pleading at the trial and appellate level which have been liberalized to allow courts to focus on the substantive merits of the dispute, rather than the procedural niceties.13 ¶14 The statutory framework for cases brought under 22 O.S. 2011 §1181 has remained essentially the same since statehood. In this cause, the sheriff was accused of wilful neglect of duty.14 The grand jury's accusation may include either a single act or multiple acts on which the removal proceedings are based.15 There is no statutorily required form or format for an accusation of removal that must be used. Rather, the only guidelines are that the accusation must be written in ordinary, plain, non-repetitive, understandable language.16 The accused may deny the truth of the allegations17 or may object to their legal sufficiency,18 and/or answer to the allegations.19 ¶15 The Court thoroughly re-visited the accusation process nearly 50 years after State v. Scarth, supra, in Russell v. Henderson, 1979 OK 164, 603 P.2d 1132 when the grand jury of Wagoner County returned an accusation against the District Attorney alleging habitual or wilful neglect in office and gross partiality. Under the allegations of habitual or wilful neglect were seven instances/acts of neglect which were listed in addition to the one allegation of gross partiality in office. After a motion to dismiss was treated as a demurrer, the trial court sustained the motion but struck one paragraph of the accusation. The attorney appealed. ¶16 The Russell Court again reiterated: 1) the civil nature of the proceedings: and 2) the lack of strictly applied requirements of criminal indictments. However, the Court issued a writ of prohibition against the trial court proceeding because the underlying eight counts merely alleged conclusions and not, as required by the statutes, facts from which conclusions could be drawn by the jury. This is clearly not the case here. ¶17 While this accusation may not have been as artfully drawn as historical accusations have been, no particular form is required. The accusation was written clearly, and it avoided repetition by refraining from restating the allegation of wilful neglect of duty before each act alleged. Like the allegations in Russell, one count of wilful neglect of duty was alleged supported by three incidences/acts or occurrences. The allegations specifically included clearly described facts which, if proven, a jury could have drawn the conclusion from any one of them that wilful misconduct had occurred. ¶18 Accordingly, we hold that the grand jury's accusation for removal from office which included multiple factually alleged inappropriate acts, did not require the State to pursue and prove every stated inappropriate act in order to prove the accusation of wilful misconduct of duty. There is no error in the trial court striking a particular factually alleged act if, on the eve of trial, the accused denied any of the alleged acts and the State determined that it lacked evidentiary support to prove one of them. ¶19 II. THE TRIAL COURT PROPERLY MODIFIED THE PROPOSED JURY INSTRUCTIONS TO CONFORM TO THE EVIDENCE PRESENTED. ¶20 The grand jury's accusal included two specific incidents: 1) the release of a female prisoner to the custody of her mother without prior court approval and bail bond; and 2) neglecting to take custody of a suspect who, pursuant to an arrest warrant, presented himself at the jail. The accusation was made pursuant to 22 O.S. 2011 §1181 which does not specifically define habitual or wilful neglect of duty.20 ¶21 Oklahoma Uniform Jury Instruction 3-27 Removal of Public Officer provides that a public officer may be removed from office for habitual or wilful neglect of duty.21 Although neither this Court nor the statutes have provided a general or uniform definition of wilful neglect of duty,22 the uniform instruction defines it as the failure to act with a bad or evil purpose or deliberately act contrary to a known duty.23 The instruction also notes that mere thoughtless acts, with no bad or evil purpose, in which there is no excusable carelessness or recklessness on the part of the officer do not justify removal from office. ¶22 Because the State presented no evidence at trial that Price acted with a "bad or evil purpose" the trial court modified the instruction which was given to delete references to a "bad or evil purpose."24 The sheriff argues that the trial court erred in altering the uniform instruction and that a "bad or evil purpose" is required. The State disagrees and insists that the trial court was required to alter the instructions to conform to the evidence presented. ¶23 Our definition of wilful neglect of duty has varied depending on the statutes in question.25 Nevertheless, we must look at a statute's underlying intent and purpose to define it.26 For example, recently in Estes v. ConocoPhillips Co., 2008 OK 21, 184 P.3d 518, we re-examined the meaning of "wilful"in the context of several acts. We said: ¶17 The term willful does not have a uniform meaning throughout our statutes. As the Court stated in Wick v. Gunn, 1917 OK 607, ¶3, 169 P. 1087, there are "numerous definitions of the word [willful] by both lexicographers and jurists." In the context of a willful violation of the Alcoholic Beverage Control Act, this Court held: "The word 'willfully' is of similar import or the equivalent of 'knowingly' [and] requires that the licensee at least have some knowledge of the commission of the prohibited acts." The Court held that a willful violation of the Open Meetings Act, "does not require a showing of bad faith, malice, or wantonness, but rather, encompasses both conscious, purposeful violations of the law and blatant or deliberate disregard of the law by those who know, or should know, the requirements of the [Open Meetings] Act." ¶18 When used to determine whether a Workers' Compensation claimant willfully fails to use safety equipment, this Court held that the term signifies "more than a mere act of the will, and carries with it the idea of premeditation, obstinacy, and intentional wrongdoing." Willful neglect of a teacher's duties is defined as "a knowingly and purposeful violation of a teacher's duties." Construing willful maladministration by a public officer, the Court held: Every voluntary act of a human being is intentional; but, generally speaking, a voluntary act becomes willful in law only when it involves some degree of conscious wrong or evil purpose upon the part of the actor, or at least an inexcusable carelessness on his part, whether the act be right or wrong. Because the term willful does not have a singular meaning, it must be construed within the confines of the Act in which it appears. (Footnotes omitted.) ¶24 Estes involved the meaning of "wilful" as it applies to a civil remedy for violations of the Standards for Workplace Drug and Alcohol Testing Act (the Act). It was urged that a wilful violation of the Act contemplated only conscious, purposeful violations of the Act, but not deliberate disregard of the laws by those who know or should have known of the Act's requirements. ¶25 The noted purpose of the Act was to provide standardized testing to assure due process. Although violators were subjected to criminal penalties of fines and imprisonment for wilful and knowing violations, civil remedies were provided as well. We determined that the meaning of wilful should not be treated synonymously in both the civil and criminal context because it would render the differing penalties meaningless. In the context of a civil remedy, the term wilful violation contemplated not only conscious, purposeful violations of the Act, but also deliberate disregard of the laws by those who know, or should have known, of the requirements of the Act. ¶26 This civil/criminal dichotomy is also present in removal proceedings. Public officers may face criminal prosecution for violations of their statutory duties, but the civil remedy of removal from office is also available.27 The purpose of the grand jury proceeding is the same as providing drug testing standards -- assurance of due process. ¶27 In some of our prior decisions involving removal of public officers, the term "wilful" has been equated with requiring some sort of "bad or evil intent" to prove wilful conduct sufficient for removal.28 However, in other cases, public officers have also been removed for deliberately disregarding the laws that the officer either knew or should have known were required to be followed.29 In others, their actions were determined to be merely thoughtless, but not sufficient for removal from office.30 ¶28 These prior cases, taken collectively, illustrate precisely what we concluded in Estes, supra, -- that the term "wilful" involved a showing of acts which were done either with a bad or evil intent or were contrary to a known duty, or the inexcusably reckless performance an official duty, but not necessarily both. Clearly, something more than a reckless error of judgment is required, but a "bad or evil intent" is not required when the conduct is shown to be a deliberate disregard of the laws by those who know, or should have known of their statutory duties.31 ¶29 The uniform jury instruction relating to removal takes this construction into account by referencing either a bad or evil purpose, or that a deliberate act or failure to act contrary to a known duty. A sheriff who discharges a prisoner without proper authority flagrantly violates a sheriffs' duties. 32 The release of a person on personal recognizance is a judicial function.33 ¶30 Here, it is agreed by the parties that the State did not present any evidence of bad or evil intent. Jury instructions are required to state the law applicable to the evidence.34 The Oklahoma statutes recognized that the uniform instructions may need to be modified to accurately state the law.35 When reviewing jury instructions, the standard of review considers the accuracy of the statement of the law and the applicability of the instructions to the issues when the instructions are considered as a whole.36 A jury instruction materially deviating from the dispositive legal issue is considered prejudicial.37 Under the evidence presented, and the facts alleged, the trial court properly modified the proposed jury instruction to conform to the evidence presented.38 ¶31 III. THE TRIAL COURT DID NOT ERR IN DENYING THE MOTION FOR A DEMURRER TO THE EVIDENCE/DIRECTED VERDICT. ¶32 The sheriff argues that because the State did not present any specific, direct evidence that the sheriff knew that he was violating the law by his actions, it should have granted the motion to demur to the evidence and given a directed verdict in his favor. The State contends that it presented ample circumstantial and direct evidence proving that the sheriff wilfully neglected his known duty. ¶33 The test of a demurrer to the plaintiff's evidence requires both the trial court and the reviewing court to accept as true all of the plaintiff's evidence and its reasonable inferences, and to disregard conflicting evidence favorable to the defendant.39 A demurrer to the plaintiff's evidence should be sustained only when there is an entire absence of proof.40 ¶34 This cause is similar to Bowles v. State, 1923 OK 226, 215 P. 934. In Bowles, the Mayor of the City of Durant neglected to file statutorily required monthly reports for several months and removal from office was sought. The court stated in ¶15 that: The defendant was bound to know that it was his duty to file these reports, and the facts disclosed by the record show that his failure to do so was a clear violation of his duties as a public officer, and that he could not have failed in his duty otherwise than knowingly and willfully. Such failure, in our opinion, constituted both "habitual and willful neglect of duty" and "willful maladministration," and the trial court acted properly in overruling the demurrer to the evidence, and in refusing to give the peremptory instruction requested. ¶35 Here, it is unnecessary to regurgitate all of the State's evidence. We have reviewed the record and the evidence was ample, both circumstantial and direct, that the sheriff knew his duties regarding the jail as well as the procedures for releasing and booking inmates. Like the mayor in Bowles, the sheriff could not have failed in his duty otherwise than knowingly and wilfully. The trial court did not err in denying the sheriff's motion for demurrer to the evidence/directed verdict. CONCLUSION ¶36 Accusations for removal are not required to be in any particular form or format. Nor are they subject to the same strictures of a criminal indictment.41 There was no error under the facts presented in allowing the State to pursue only two of the three alleged acts of wilful conduct when seeking removal of the sheriff. ¶37 Jury instructions are required to conform to the evidence presented.42 Because no evidence of bad or evil intent existed, the trial court properly modified the proposed jury instructions to conform to the evidence. The circumstantial and direct evidence presented, was clearly sufficient to withstand a motion for demurrer and/or directed verdict for the sheriff. The trial court's removal of the sheriff of Pawnee County is affirmed. MOTION TO RETAIN PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED. TAYLOR, C.J., COLBERT, V.C.J., KAUGER, WATT, EDMONDSON, COMBS, GURICH, JJ., concur. REIF, J, dissents. WINCHESTER, J., not participating. FOOTNOTES 1 Several issues were raised in the petition in error which have either been consolidated or waived. Oklahoma Urban Renewal Authority v. City of Oklahoma City, 2005 OK 2, ¶7, fn. 9, 110 P.3d 550; Johnson v. Ford Motor Co., 2002 OK 24, ¶1, n.2, 45 P.3d 86; Hadnot v. Shaw, 1992 OK 21, ¶7, 826 P.2d 978. Naked argument unsupported by facts or authority is without merit and will be treated as waived. Tiger Flats Production Co.v. Oklahoma Petroleum Extracting Co., 1985 OK 105, ¶8, 711 P.2d 106. Okla. Sup. Ct. R. 1.11(k), 12 O.S. 2011 App. 1, provides: (1) Appeals. Issues raised in the Petition in Error but omitted from the brief may be deemed waived. Argument without supporting authority will not be considered. 2 Title 22 O.S. 2011 §1181 provides in pertinent part: Any officer not subject to impeachment elected or appointed to any state, county, township, city, town, or other office under the laws of the state may, in the manner provided in this article, be removed from office for any of the following causes: First. Habitual or willful neglect of duty. . . . We note at the outset that all references to statutes are to the most recent version because nothing has materially changed since the sheriff's conduct occurred. 3 Title 21 O.S. 2011 §532 provides in pertinent part: Any sheriff, coroner, clerk of a court, constable or other ministerial officer and any deputy or subordinate of any ministerial officer, who either: 1. Willfully or carelessly allows any person lawfully held by him in custody to escape or go at large, except as may be permitted by law; . . . shall be guilty of a felony. Title 59 O.S. 2011 §1334 provides in pertinent part: A. Any person in custody before a court or magistrate of the State of Oklahoma subject to discretion of the court, may be admitted to bail on his personal recognizance subject to such conditions as the court or magistrate may reasonably prescribe to assure his appearance when required. ... C. Any person admitted to bail as herein provided shall be fully appraised by the court or magistrate of the penalties provided for failure to comply with the terms of his recognizance and, upon a failure of compliance, a warrant for the arrest of such person shall be issued forthwith. Very limited circumstances exist for a sheriff to release an arrestee which are not present here. See 22 O.S. 2011 §209 and 1981 OK AG 103 for a discussion of those limited circumstances. 4 Title 21 O.S. 2011 §533 provides in pertinent part: A. Except as provided in this section and Section 979a of Title 22 of the Oklahoma Statutes, for emergency medical treatment for an injury or condition that threatens life or threatens the loss or use of a limb, any peace officer or jail or prison contractor who, in violation of a duty imposed upon the officer or contractor by law or by contract to receive into custody any person as a prisoner, willfully neglects or refuses so to receive such person into custody is guilty of a misdemeanor. . . . 5 Title 22 O.S. 2011 §1195 provides in pertinent part: 1) When the complaint for removal is filed, if, in addition to the matter charged as ground for removal, the complaint shall also pray that the officer charged be suspended from office pending the investigation, the judge of the court may, if sufficient cause appear from the charge or from the testimony, or affidavits then presented, order the suspension of the accused from the functions of his office until the determination of the matter.... 6 Title 22 O.S. 2011 §1192 provides: Upon a conviction, the court must pronounce judgment, that the defendant be removed from office. But to warrant a removal, the judgment must be entered upon the minutes, assigning therein the causes of removal. 7 The appellant bears total responsibility for including in the appellate record all materials necessary for corrective relief. First Federal Savings & Loan Assoc. Chickasha, Oklahoma v. Nath, 1992 OK 129, ¶10, fn. 31, 839 P.2d 1336; Hulsey v. Mid-America Preferred Ins. Co.,1989 OK 107, ¶7, 777 P.2d 932; Eckel v. Adair, 1984 OK 86, ¶7, 698 P.2d 921. The appellant bears the burden to monitor the case and verify that everything relied upon for appeal was provided to the Court as intended. See, Oklahoma Supreme Court Rules 1.33 (c), 1.34(a) and 1.64, 12 O.S. 2011 Ch. 1 App. 1. Legal error may not be presumed from a silent record; it must be affirmatively demonstrated. On review, we always indulge in the presumption that a trial court's decision is correct; every fact not disputed by the record must be regarded as supporting the trial court's judgment. First Federal Savings & Loan Assoc., Chickasha, Oklahoma v. Nath, supra at ¶10; Hamid v. Sew Original, 1982 OK 46, ¶7, 645 P.2d 496. 8 A copy of the accusation is attached as an appendix to this opinion. 9 Title 22 O.S. 2011 §§1181-97. 10 Title 22 O.S. §1191 provides: The trial must be by jury and conducted in all respects in the same manner as the trial of an indictment for a misdemeanor. Title 22 O.S. 2011 §1196 provides: The question of fact shall be tried as in other actions, and if the accused is found guilty, the judgment shall be entered removing the officer from his office and declaring the latter vacant, or as provided for in the code of criminal procedure, and a copy thereof shall be certified to the board of county commissioners, and the county clerk shall enter the same upon the proper record. 11 In State ex rel. Grand Jury of McCurtain County v. Pate, 1977 OK 232, ¶¶17-18, 572 P.2d 226, the Court noted that an accusation in writing is, in effect, an indictment charging the commission of a crime. Pate is not dispositive of this cause because it involved the specific question of whether grand juries' authorities to issue accusations had been repealed by a constitutional amendment giving grand juries power to investigate and return "indictments." It did not address whether the written accusations must be drafted and construed with the same stringency as a criminal indictment charging a crime punishable by something more than forfeiture from office. Pate's limited holding and application was later clarified and recognized in Hale v. Board of County Comm'rs of Seminole County, 1979 OK 158, ¶3, 603 P.2d 761 and McCormack v. Town of Granite, 1995 OK 105, ¶10, 913 P.2d 278. See also, Rutter v. Territory of Oklahoma, 1902 OK 13, ¶O, 68 P. 507. 12 In Maben v. Rosser, 1909 OK 211, ¶17, 103 P. 674 the Court said: We are not impressed with the argument that this is a criminal action of the class of a misdemeanor. It is not defined to be such by any statutory provision. Our statutes provide that remedies in the courts are divided into two classes, to wit, actions and special proceedings. An "action" is defined to be an ordinary proceeding in a court of justice in which a party prosecutes another party for the enforcement or protection of a right, the redress or prevention of a wrong, or the punishment of a public offense. All other remedies are classed as "special proceedings." Actions are divided into two classes, to wit, civil and criminal. A "criminal action" is defined to be one prosecuted by the state as a party against a person charged with a public offense for the punishment thereof. Every other action is a "civil action." Section 4201 and 4206, Wilson's Rev. & Ann. St. 1903. The class to which any proceeding belongs is determined by the relief sought and the judgment that can be rendered. A proceeding to remove an officer under article 4, Wilson's Rev. & Ann. St. 1903, is not to punish for a violation of the penal laws. No judgment assessing a fine or imprisonment can be rendered in such action. The purpose of it is to relieve the people from faithless, corrupt officers, who have violated their trust, by affording a speedy and adequate means for their removal. That its object is not to punish for an offense committed against the penal law is evidenced by the fact that the remedy it affords and the judgment that can be rendered in such action can only be availed of while the defendant occupies his office. If the offense be not discovered during the pendency of his term the action will entirely fail to serve the purpose of affording a punishment for the offense committed. 13 Markwell v. Whinery's Real Estate, Inc., 1994 OK 24, ¶6, 869 P.2d 840. 14 Title 22 O.S. 2011 §1181 see note 2, supra. 15 Title 22 O.S. 2011 §1181.2 provides: The complaint, petition, accusation or proceeding for removal or ouster from office may include allegations or charges of any act or acts of commission, omission or neglect which may be committed, done or omitted during the term of office in which such ouster or removal proceeding may be filed, and may also include allegations or charges as to any act or acts of commission, omission or neglect committed, done or omitted during a previous or preceding term in such office. Title 22 O.S. 2011 §1182 provides: An accusation in writing, charging such officer with any of the causes for removal mentioned in the first preceding section may be presented by the grand jury to the district court of the county in or for which the officer is elected or appointed: Provided, that in the case of a state officer, such accusation may be presented by the grand jury of the county in which such officer resides, or in which he has his place of office for the usual transaction of official business. 16 Title 22 O.S. §1183 provides: The accusation must state the offense charged, in ordinary and concise language, without repetition, and in such manner as to enable a person of common understanding to know what is intended. 17 Title 22 O.S. 2011 §1188 provides: If he deny the truth of the accusation the denial may be oral and without oath and must be entered upon the minutes. 18 Title 22 O.S. 2011 §1187 provides: If he object to the legal sufficiency of the accusation the objection must be in writing but need not be in any specific form, it being sufficient if it present intelligibly the ground of the objections. 19 Title 22 O.S. 2011 §1189 provides: If an objection to the sufficiency of the accusation be not sustained the defendant must answer the accusation forthwith. 20 Title 22 O.S. 2011 §1181, see note 2, supra. 21 Oklahoma Uniform Jury Instruction, Ch. 3, §27 provides in pertinent part: OUJI-CR 3-27 REMOVAL OF PUBLIC OFFICER A/n [Identify Public Officer] may be removed from office for [any of] the following causes(s): [habitual or willful neglect of duty]. . . [Willful neglect of duty means that the [Identify Public Officer]'s act/(failure to act) was for a bad or evil purpose, or that the [Identify Public Officer] deliberately acted/(failed to act) contrary to a known duty. Mere thoughtless acts, with no bad or evil purpose, in which there is no inexcusable carelessness or recklessness on the part of a/n [Identify Public Officer] do not justify removal from office.]. . . . Statutory Authority: 22 O.S. 1991, §§ 1181-1197. Notes on Use Since a proceeding for removal of a public officer is initiated by an accusation from a grand jury (or the board of county commissioners for a county or township officer), OUJI-CR 1-8 should be modified to remove the references to informations and indictments. See, 22 O.S. 1991 §§ 1182 (grand jury), 1194 (board of county commissioners). The trial court should select the appropriate grounds for removal from office from the list in the first paragraph, and it should then give the definitions that correspond to the grounds that were selected. 22 Estes v. ConocoPhillips Co., 2008 OK 21, ¶17, 184 P.3d 518 [The term wilful does not have a uniform meaning throughout our statutes.]; Childers v. Independent School Dist. No. 1 of Bryan County, 1981 OK 123, ¶19, 645 P.2d 992 [There are no Oklahoma court decisions which give a general definition of wilful neglect of duty.]. 23 Oklahoma Uniform Jury Instruction 3-27 Committee Comments note that the definition is taken from criminal cases. It provides: A proceeding for removal of a public officer has attributes of both a criminal and a civil action. State ex rel. Grand Jury v. Pate, 572 P.2d 226, 228 (Okl. 1977). Nevertheless, the trial is conducted in the same way as a misdemeanor trial. 22 O.S. 1991, § 1191. The definitions of wilful neglect of duty and wilful maladministration were taken from Phillips v. State, 75 Okl. Cr. 46, 181 P. 713 (1919) (Syllabus 2) (wilful neglect of duty), and Shields v. State, 184 Okl. Cr. 618, 89 P.2d 756 (1939). We note that the comments refer to Shields as a criminal case but it is actually a civil case cited as Shields v. State, 1939 OK 203, 89 P.2d 756. 24 Instruction No. 21 which was given at the trial provides: A County Sheriff may be removed from office for willful neglect of duty. Willful neglect of duty means that the Sheriff deliberately acted or failed to act contrary to a known duty. Mere thoughtless acts, in which there is no inexcusable carelessness or recklessness on the part of the Sheriff, do not justify removal from office. 25 Estes v. ConocoPhillips Co., see note 22, supra. 26 Estes v. ConocoPhillips Co., see note 22, supra at ¶16; Childers v. Independent School Dist. 1 of Bryan County, see note 22, supra. See, Simpson v. Oklahoma Alcoholic Beverage Control Board, 1965 OK 206, 409 P.2d 364; Oklahoma Alcoholic Beverage Control Board v. Milam, 1964 OK 54, 393 P.2d 823. 27 See discussion of Maben v. Rosser, note 12, supra, wherein the Court recognized removal was not a criminal punishment, but serves to relieve people from faithless, corrupt officers. 28 Shields v. State, 1939 OK 203, ¶16, 89 P.2d 756 suggests a bad intent is required. 29 In Bowles v. State, 1923 OK 226, 215 P. 934 the mayor of Durant was removed from office where the accusation did not suggest that he acted maliciously but the evidence showed that: 1) he "was bound to know that it was his duty" to file monthly reports; 2) the facts disclosed that his failure to file reports was a clear violation of his duties as a public officer; and 3) he could not have failed in his duty otherwise than knowingly and wilfully. Bradford v. Territory ex rel. Woods, 1894 OK 11, 37 P. 1061 held that acts need not be such that would subject the public officer to criminal prosecution, but any acts done knowingly in violation of a statutory duty are sufficient to constitute maladministration to forfeit right to office. 30 Phillips v. State, 1919 OK 168, 181 P. 713 involved a sheriff who bet on an election which was illegal and failed to arrest the person he placed the bet with who also illegally bet. The court determined that the sheriff's actions were thoughtless but did not rise to the level of wrongdoing to subject him to removal from office. 31 Title 19 O.S. 2011 §513 sets forth sheriff's duties regarding the custody of prisoners in the county jail as: The sheriff shall have the charge and custody of the jail of his county, and all the prisoners in the same, and shall keep such jail himself, or by his deputy or jailer, for whose acts he and his sureties shall be liable. Pursuant to 21 O.S. 2011 §532, see note 3, supra, a sheriff is subject to criminal sanctions for the failure to perform duties concerning the keeping of prisoners. Title 21 O.S. 2011 §533, see note 4, supra. See also 21 O.S. 2011 §538 which provides: Every person who, after having been lawfully commanded by any magistrate to arrest another person, willfully neglects or refuses so to do, is guilty of a misdemeanor. 32 Whiteaker v. State, 1911 OK 452, 119 P. 1003. For a discussion of the lack of authority for a sheriff to release a prisoner without an appearance before the court, see 1980 OK AG 1and 1981 OK AG 103. A county sheriff has statutory responsibility for the custody of prisoners in the county jail. 57 O.S. 2011 §47 and 19 O.S. 2011 §513. See also, 57 O.S. 2011 §§48, 61-62 regarding the sheriff's record keeping duties related to jails. 33 Title 59 O.S. 2011 §1334; Title 22 O.S. 2011 §1105; Title 22 O.S. 2011 §209. See also general discussion in 1980 OK AG 1of the various duties of the sheriff and the trial court. 34 Mosley v. Truckstops Corp. of America, 1993 OK 79, ¶9, 891 P.2d 577. 35 Title 12 O.S. 2011 §577.2 provides in pertinent part: Whenever Oklahoma Uniform Jury Instructions (OUJI) contains an instruction applicable in a civil case or a criminal case, giving due consideration to the facts and the prevailing law, and the court determines that the jury should be instructed on the subject, the OUJI instructions shall be used unless the court determines that it does not accurately state the law. Whenever OUJI does not contain an instruction on a subject on which the court determines that the jury should be instructed, the instruction given on that subject should be simple, brief, impartial and free from argument. . . . 36 Mosley v. Truckstops Corp. of America, see note 34, supra. 37 Fletcher v. Monroe, 2009 OK 10, ¶13, 208 P.3d 926; Simpson v. Gear, 1986 OK 27, ¶7, 725 P.2d 1241. 38 Our resolution of this issue is also dispositive of the sheriff's argument regarding the verdict forms. No third option exists for the jury to determine that the sheriff's conduct met the definition of wilful neglect of duty but did not rise to the level necessary for removal of office. The jury is only charged with determining whether the State proved such conduct or not. 39 Beshara v. Southern National Bank, 1996 OK 90, ¶15, 928 P.2d 280; Gay v. Hartford Underwriters Ins. Co., 1995 OK 97, ¶12, 904 P.2d 83; Hampton v. Hampton, 1987 OK 77, ¶16, 743 P.2d 1053. 40 Beshara v. Southern National Bank, see note 39, supra; Hampton v. Hampton, see note 39, supra; Boyles v. Oklahoma Natural Gas Co., 1980 OK 163, ¶6, 619 P.2d 613. 41 See discussion pages 9-10, infra. 42 Mosley v. Truckstops Corp. of America, see note 34, supra. REIF, J.: dissenting. ¶1 I respectfully dissent. ¶2 I would reverse the judgment removing Sheriff Price from office, because the jury was given an erroneous instruction on the issue of willful neglect of duty. Such error was fundamental because "willful neglect of duty" was the only ground for removal alleged against Sheriff Price. ¶3 The jury was erroneously instructed that a willful neglect of duty would occur if "the Sheriff deliberately acted or failed to act contrary to a known duty." This definition permitted the jury to find the Sheriff acted in a willful manner if he did nothing more than act in a voluntary or intentional manner. Such a construction of "willful" was rejected long ago in Phillips v. State, 1919 OK 168, 181 P. 713. ¶4 In Phillips, this Court cited approvingly from an Iowa case that observed: Every voluntary act of a human being is intentional; but, generally speaking, a voluntary act becomes willful in law only when it involves some degree of conscious wrong or evil purpose upon the part of the actor . . . . Id. at ¶ 7, 181 P. at 714 (citing State v. Meek, 127 N.W. 1023, 1024 (Iowa 1910)). In Phillips, this Court determined that the act of a sheriff in betting on an election, and failing to arrest the person with whom the sheriff had bet, was "wrong, and to be condemned," but was not a willful neglect of duty.1 That is, there was an absence of conscious wrong or evil purpose on the part of the sheriff in relation to the duties of his office. ¶5 Interpreting a "willful neglect of duty" as one involving a "conscious wrong or evil purpose" is also consistent with the context in which "willful neglect of duty" is used.2 The term "willful neglect of duty" is one of eight enumerated causes for the removal of an office holder who is not subject to removal by impeachment. The other seven causes are: - Gross partiality in office - Oppression in office - Corruption in office - Extortion or willful overcharge of fees - Willful maladministration - Habitual drunkenness - Failure to produce and account for all public funds and property in his hands at any settlement or inspection authorized or required by law. See 22 O.S.2011 § 1181. With the exception of "Habitual drunkenness" and "Failure to produce and account," all of these causes involve "conscious wrong or evil purpose." ¶6 Finally, removal from office is a penalty for wrongdoing, regardless of how it is procedurally achieved (i.e. special proceeding vs. civil action). The end result is a forfeiture authorized by statutory law. Penal and forfeitures statutes are to be strictly construed. Allowing a penalty or forfeiture of the magnitude of removal from office without an attendant finding of "conscious wrong or evil purpose" as an element of willfulness, places all public officials at peril whenever they simply decline to act, regardless of their reason for declining to act. FOOTNOTES 1 At the time the Phillips case was decided, the penal code also specifically provided for the removal from office of any peace officer who violated Oklahoma Gambling Laws, or who knowingly or willfully neglected, failed, or refused to enforce gambling laws. See 21 O.S.2011 § 948; 21 O.S.2001 § 949 (repealed in 2006). 2 Willful is a word of many meanings, and its construction is often influenced by its context. Screws v. United States, 325 U.S. 91, 101 (1945).

3a478b74-ff34-49ff-be10-3890e6a43d0b

Akin v. Castleberry

oklahoma

Oklahoma Supreme Court

AKIN v. CASTLEBERRY2012 OK 79Case Number: 108342Decided: 09/18/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CHAD H. AKIN Plaintiff/Appellant, v. DON S. CASTLEBERRY, SAM D. CASTLEBERRY, and TERRY G. CASTLEBERRY, all if living, and if dead their unknown heirs, executors, administrators, devisees, trustees and assigns, Defendants/Appellees, and THE COUNTY COMMISSIONERS OF TILLMAN COUNTY, STATE OF OKLAHOMA, Defendants. CERTIORARI TO THE COURT OF CIVIL APPEALS DIVISION III Honorable Richard Darby, Trial Judge ¶0 This cause concerns a dispute over the title to real property along the Red River in Tillman County, Oklahoma. The plaintiff/appellee, Chad H. Akin (Akin), asserts title by adverse possession, even though he also insists that he owns the property through a deed given to him by his father, Hugh L. Akin (father), in 1975. The defendants/appellees, Don S. Castleberry, Sam D. Castleberry, Terry G. Castleberry, (collectively Castleberrys) deny Akin's assertion of adverse possession and, instead, insist that they own the property through a deed obtained from their aunt in 1986. The trial court determined that Akin neglected to prove title by adverse possession and Akin appealed. The Court of Civil Appeals reversed. We granted certiorari and hold that the trial court should be affirmed because title by adverse possession was not proven under the facts presented. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT AFFIRMED. Babette Patton, Oklahoma City, Oklahoma, for Plaintiff/Appellant. Brandon Wilson, Oklahoma City, Oklahoma, for Defendants/Appellees. KAUGER, J.: ¶1 The only issue presented on appeal is whether the trial court erred in determining that title to the property was not held by adverse possession. We affirm the trial court's decision because title by adverse possession was not proven under the facts presented. FACTS ¶2 In October of 1956, Robert and Florence McKinney (collectively McKinneys) purchased the disputed real property from a widower. The deed described the property as follows: The Surface rights only in and to: The South Half (S ½) of the Southeast Quarter (SE ¼) of Section Eight (8), and Lots One (1), Two (2) and Three (3) of Section Seventeen (17), all in Township Four (4) South, Range Seventeen (17) West, I.M., Tillman County, Oklahoma, containing 162.37 acres more or less. ¶3 On September 26, 1975, the McKinneys retired from farming and sold their land at public auction. According to the auction flyer, the sale involved two parcels of land. The first sale was identified as "Sale No. 1" and it concerned "[t]he West 90 acres of the NE ¼ Section of 17W." The second parcel was identified as "Sale No. 2" and it was described as "The South ½ of the SE ¼ Section, 8-4S17W, and Lot 3 of Section 17-42-17W. Containing 160 acres, more or less in all grass." Lots 1 and 2 which were part of the original 1956 deed were not mentioned in the flyer and apparently not included in the sale. ¶4 Lots 1 and 2 consist of grass, trees, and shrub land along the Red River. Lot 1 is approximately 38.02 acres and Lot 2 is approximately 25.40 acres. The lots, unsuitable for cultivation, are primarily used for running cattle, hunting, or access to the river for fishing or other recreational activities. The lots are land-locked with no road to access them. Two sides of the lots are abutted by land owned by the Akin family, another side is abutted by land owned by a person named Wright and the fourth side borders the Red River. ¶5 Akin's father purchased the second parcel identified in the real estate auction flyer as "Sale No. 2" at the auction and entered into a real estate mortgage for the property with the McKinney's for $13,125.00.1 Three days later, the father deeded the property to Akin who was 12 years old at the time. On February 21, 1986, Florence McKinney, then a widow, deeded Lots 1 and 2, as described in the original 1956 deed, to the Castleberrys.2 ¶6 On January 5, 2007, Akin filed a petition to quiet title to real estate in Tillman County District Court, seeking title to Lots 1 and 2 as described in the Castleberry's deed. He alleged that for more than 30 years prior to the institution of the action, he and his predecessors had been in open, notorious, adverse, exclusive and continuous possession of the property. The Castleberrys denied the allegations and counterclaimed, alleging that Akin had interfered with their use of the property and caused a cloud upon their title to the property. ¶7 A trial was held before the District Judge on June 9, 2008. On June 27, 2008, the trial judge filed a journal entry of judgment concluding that title to the disputed Lots 1 and 2 was vested exclusively in Akin. The Castleberrys appealed and in case no. 106,151, on September 11, 2009, in an unpublished opinion, the Court of Civil Appeals reversed and remanded the matter to the trial court. It held that the trial court erred when it neglected to consider the testimony of the Castleberry's lawyer's corroborative evidence concerning permissive use of the property.3 ¶8 On February 12, 2010, the trial court heard the testimony of the Castleberry's lawyer. On February 22, 2010, the trial court, after reconsidering all the evidence and the additional testimony, determined that Akin failed to prove his claim of adverse possession. On February 26, 2010, Akin filed a motion for new trial/motion to vacate judgment which the trial court denied on April 9, 2010 in an order filed April 21, 2010. Akin appealed on May 21, 2010, and on September 23, 2011, in an unpublished opinion, the Court of Civil appeals reversed the trial court.4 We granted certiorari on December 12, 2011. ¶9 TITLE BY ADVERSE POSSESSION WAS NOT PROVEN UNDER THE FACTS PRESENTED. ¶10 Recognizing that the time limit has expired to correct any alleged mistake in the 1975 deed that his father may have received after the public auction,5 Akin seeks to quiet title to the property by way of a claim of adverse possession. The Castleberrys deny Akin's claim and argue that the unbroken chain of record title shows ownership in the property belongs to them. They also insist that any adverse claim that Akin might assert is defeated by the fact that they have been in possession of the property since 1986, and have paid taxes on the property since then as well. ¶11 In adverse possession cases, the appellate court weighs evidence presented but will not reverse the trial court's judgement unless it is against the clear weight of evidence.6 To establish adverse possession, the claimant must show that possession was hostile, under a claim of right or color of title, actual, open, notorious, exclusive,7 and continuous for the statutory period of fifteen years.8 ¶12 Furthermore, a claim of ownership must notify persons seeking information upon the subject that the premises are not held in subordination to any title or claim of others, but against all titles or claimants.9 Acquisition by prescription is disfavored, and not to be made out by inference.10 The party claiming title adversely has the burden of proving every element by clear and positive proof.11 In questionable cases, presumptions favor the record title holder.12 ¶13 What constitutes adverse possession depends on the circumstances of the particular case, as measured by the judgment of reasonable people. The determination in any given case must largely depend on the situation of the parties, size and extent of land, and purpose for which it is adapted.13 Payment of taxes is not controlling circumstances but is one means whereby claim of ownership is asserted.14 ¶14 At trial, the evidence of record title to the property was clear and uncontroverted. Direct and circumstantial evidence showed that the McKinneys were the record owners of lots 1 and 2 from 1956 until 1986, when, then widowed, Florence McKinney deeded the lots to the Castleberrys. Once the Castleberrys obtained the lots, they paid all of the ad valorem property taxes since 1986. While Akin testified that he and his father thought that his father had purchased lots 1 and 2 at auction, the deeds never reflected such and neither Akin nor his father ever attempted to correct their deeds to reflect this belief. Obviously, McKinney did not share this belief or she would not have deeded the property in 1986. Nevertheless, an abstract that Akin had prepared on October 17, 1975, includes lots 1 and 2 in a map of the property purchased and in the caption of the title opinion. ¶15 The evidence also reflects that both parties exercised possession and/or control of the property over the years. For example, on January 15, 1979, Akin granted a right of way/easement for all three lots to Diamond Shamrock Corporation for an oil and gas pipeline. The Akin family also built fences around the property and kept a gate with a lock on it which would inhibit access to the property in question when locked. Nevertheless, the Castleberrys claimed to have had, at some point in time, a key to unlock the gate, so that they could access their property. None of the Castleberrys lived in Tillman County and they only occasionally used the property for recreational purposes. Akin posted "NO TRESPASSING" signs on various points along the property borders. ¶16 In 2005, the Castleberrys inquired into the possibility of the county clearing a road to the property. Both parties presented evidence of use of the property either for cattle grazing, hunting or access to the river. In 1987, the Castleberrys asked an attorney to draft an agreement to present to Akin which would allow them to permissively run cattle on the disputed property in exchange for access to the property. Apparently, this "agreement" was never signed by Akin.15 ¶17 In addition to the uncontroverted evidence that the Castleberrys paid the taxes on the property since 1986, the uncontroverted evidence also shows that both Akin and the Castleberrys were in possession of and used the property at the same time since 1986.16 These facts are fatal to Akin's claim of adverse possession because in cases of mixed or dual possession (shared use), possession can never ripen into exclusive dominion over the land and the possessor who has better title is deemed to be in the possession.17 Consequently, we hold that the trial court did not err in its determination that title by adverse possession was not vested in Akin. CONCLUSION ¶18 In adverse possession cases, the appellate court weighs evidence presented but will not reverse the trial court's judgement unless it is against the clear weight of evidence.18 To establish adverse possession, the claimant must show that possession was hostile, under a claim of right or color of title, actual, open, notorious, exclusive,19 and continuous for the statutory period of fifteen years.20 The party claiming title adversely has the burden of proving every element by clear and positive proof.21 In questionable cases, presumptions favor the record title holder.22 The evidence, when taken as a whole, did not clearly and positively show that Akin had open, notorious, hostile and exclusive possession of the property for an uninterrupted and continuous period of fifteen years. Accordingly, the trial court is affirmed. CERTIORARI PREVIOUSLY GRANTED; COURT OF CIVIL APPEALS OPINION VACATED; TRIAL COURT AFFIRMED. TAYLOR, C.J., COLBERT, V.C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, REIF, GURICH, JJ., concur. COMBS, J., recused. FOOTNOTES 1 The mortgage and the deed were both dated September 26, 1975, and the property description on both provides: The South Half of the Southeast Quarter of Section Eight (8), Township Four (4) South, Range 17 WIM; and Lot Three (3) of Section Seventeen (17), Township Four (4) South, Range 17 WIM.... On September 22, 1978, the mortgage was released. 2 The February 21, 1986 deed describes the property as follows: Lots 1 and 2 of Section 17, Township 4 South, Range 17 West of the Indian Meridian... 3 Mandate in cause no. 106,151 issued on October 8, 2009. 4 We note that the transcripts and exhibits for the bench trial of June 9, 2008, were designated by the defendants/appellees on June 10, 2010. The Court of Civil Appeals also noted this, because on August 17, 2011, it issued an order requesting that the transcripts and exhibit be provided by the Tillman County Court Clerk. The clerk provided transcripts, but the exhibits remained missing. The Court of Civil Appeals decided the cause without the exhibits. We granted certiorari on December 12, 2011, and issued an order to the clerk and to the parties to show cause why the exhibits were not included in the appeal as designated. The Tillman County Clerk responded on May 29, 2012, that the exhibits could not be located. The parties also responded, indicating that they had copies of the exhibits which could be provided to the Court. On June 7, 2012, we issued an order directing the parties to jointly provide copies of the admitted exhibits and to stipulate as to their authenticity. On June 18, 2012, the parties filed the exhibits and so stipulated as to their authenticity, and the cause was finally ready for our review. 5 The parties agree that Akin is time barred from seeking reformation of the 1975 deed due to any alleged mistake in omitting Lots 1 and 2 from the deed. Title 12 O.S. 2011 §95 provides in pertinent part: A. Civil actions other than for the recovery of real property can only be brought within the following periods, after the cause of action shall have accrued, and not afterwards: 1. Within five (5) years: An action upon any contract, agreement, or promise in writing; ... 12. An action for relief, not hereinbefore provided for, can only be brought within five (5) years after the cause of action shall have accrued. . . . 6 Francis v. Rogers, 2001 OK 111, ¶12, 40 P.3d 481; Krosmico v. Pettit, 1998 OK 90, ¶23, 968 P.2d 345; Shanks v. Collins, 1989 OK 115, ¶16, 782 P.2d 1352; Carson v. Keith, 1967 OK 206, ¶11, 433 P.2d 956. 7 Francis v. Rogers, see note 6, supra; Krosmico v. Pettit, see note 6, supra at ¶15; Shanks v. Collins, see note 6, supra; Norman v. Smedley 1961 OK 143, ¶22, 363 P.2d 839. 8 Title 12 O.S. 2011 §93 provides in pertinent part: Actions for the recovery of real property, or for the determination of any adverse right or interest therein, can only be brought within the periods hereinafter prescribed, after the cause of action shall have accrued, and at no other time thereafter: ... (4) An action for the recovery of real property not hereinbefore provided for, within fifteen (15) years. Title 60 O.S. 2011 §333 provides: Occupancy for the period prescribed by civil procedure, or any law of this state as sufficient to bar an action for the recovery of the property, confers a title thereto, denominated a title by prescription, which is sufficient against all. 9 Francis v. Rogers, see note 6, supra at ¶13; Willis v. Holley, 1996 OK 107, ¶6, 925 P.2d 539; Sears v. State Dept. of Wildlife Conservation, 1976 OK 56, ¶13, 549 P.2d 1211; Sudheimer v. Cheatham, 1968 OK 99, ¶8, 443 P.2d 951. 10 Willis v. Holley, see note 9, supra at ¶5; Sudheimer v. Cheatham, see note 9, supra at ¶7; Hassell v. Texaco, Inc., 1962 OK 136, ¶13, 372 P.2d 233. 11 Francis v. Rogers, see note 6, supra; Willis v. Holley, see note 9, supra; Norman v. Smedley, see note 7, supra; Sudheimer v. Cheatham, see note 7, supra. 12 Willis v. Holley, see note 9, supra; Shanks v. Collins, see note 6, supra; Tindle v. Linville, 1973 OK 64, ¶8, 512 P.2d 176. 13 Sears v. State Dept. of Wildlife Conservation, see note 9, supra at ¶14; Kouri v. Burnett,1966 OK 61, ¶19, 415 P.2d 963. 14 Sears v. State Dept. of Wildlife Conservation, see note 9, supra at ¶15; Kouri v. Burnett, see note 13, supra at ¶28; Cox v. Sarkeys, 1956 OK 294, ¶7, 304 P.2d 979; Anderson v. Francis, 1936 OK 312, ¶17, 57 P.2d 619. 15 Akin argues that a footnote in Macias v. Guymon Ind. Foundation, 1979 OK 70, ¶7, fn.6, 595 P.2d 430 which states that merely giving notice to an occupant that true title is in someone else is ineffective unless the landowner, or someone in his behalf, acts overtly to oust the adverse claimant. This statement of the law, while it may be accurate, is not controlling nor dispositive here for several reasons: 1) this statement of the law only deals with the issue of possession and not any of the other elements Akin must prove to establish title by prescription; 2) the facts of Macias are distinguishable in that it was the unsolicited consent which was the only factor involved in that case; and 3) Macias does not address non-exclusive use of property which is at issue here. 16 What constitutes "possession" of land is a mixed question of law and fact. Personal occupancy is not a necessary element of possession. Cox v. Sarkey, 1956 OK 294, ¶¶7-9, 304 P.2d 979. 17 Sears v. State Dept. of Wildlife Conservation, see note 9, supra ¶16; Howard v. Stanolind Oil and Gas Co., 1946 OK 56, ¶¶38-39, 169 P.2d 737; Weyerhaeuser Co. v. Brantly, 510 F.3d 1259, 1261 (10th Cir. 2007). 18 Francis v. Rogers, see note 6, supra; Krosmico v. Pettit, see note 6, supra; Shanks v. Collins, see note 6, supra; Carson v. Keith, see note 6, supra. 19 Francis v. Rogers, see note 6, supra; Krosmico v. Pettit, see note 6, supra at ¶15; Shanks v. Collins, see note 6, supra; Norman v. Smedley see note 7, supra. 20 Title 12 O.S. 2011 §93 see note 8, supra. Title 60 O.S. 2011 §333 see note 8, supra. 21 Francis v. Rogers, see note 6, supra; Willis v. Holley, see note 9, supra; Norman v. Smedley, see note 7, supra; Sudheimer v. Cheatham, see note 9, supra. 22 Willis v. Holley, see note 9, supra; Shanks v. Collins, see note 6, supra; Tindle v. Linville, see note 12, supra.

9fe2c4d2-3e34-4148-8606-2aaf769843cc

County Records, Inc. v. Armstrong

oklahoma

Oklahoma Supreme Court

COUNTY RECORDS, INC. v. ARMSTRONG2012 OK 60Case Number: 109049Decided: 06/19/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. County Records, Inc., an Oklahoma corporation, Plaintiff/Appellee, v. Peggy Armstrong, Rogers County Clerk, Oklahoma, Defendant/Appellant. APPEAL FROM DISTRICT COURT OF ROGERS COUNTY Honorable Terry H. McBride ¶0 Company, in business of operating a website that provides land records to on-line subscribers, requested electronic copies of the official tract index and land documents from the Rogers County Court Clerk. The requests were denied and the company brought an action for declaratory judgment asserting a right to the documents under the Open Records Act and a determination of the appropriate fee. Summary judgment was granted for the company. REVERSED AND REMANDED WITH INSTRUCTIONS. David L. Weatherford, Birmingham, Morley, Weatherford & Priore, P.A., Tulsa, Oklahoma, for Plaintiff/Appellee. David T. Iski, Assistant District Attorney, Claremore, Oklahoma, for Defendant/Appellant. COLBERT, V.C.J. ¶1 A commercial website operator filed this declaratory judgment action seeking a determination of the reasonableness of the fee charged by the Rogers County Clerk for electronic copies of records and for a determination that the corporation was entitled to an electronic copy of the official tract index of county land records. The trial court granted summary judgment to the corporation and directed the Clerk to provide all the requested electronic copies at a "reasonable fee." This court retained the appeal of the summary judgment on its own motion and reverses and remands with instructions to enter judgment for the Rogers County Clerk. FACTS AND PROCEDURAL HISTORY ¶2 Peggy Armstrong (Defendant) is the Rogers County Clerk. She is responsible for recording and maintaining the county land records and making them available for viewing and reproduction. Okla. Stat. tit. 19, § 286 (2011). As part of that duty, she maintains an official historical tract index which are books in which the date of a document, the type of document, the legal description, the grantor and grantee, and the book and page are recorded. Defendant requires all persons who desire to copy the tract index to execute under oath a written Abstract Affidavit, pursuant to section 24A.5(4) of the Oklahoma Open Records Act, Okla. Stat. tit. 51, §§ 24 A. 1 - 24 A. 29 (2011), and the Oklahoma Abstractors Act, Okla. Stat. tit. 1, §§ 20 - 43 (2011), that reflects the person is not reproducing or distributing the records for the purpose of sale. ¶3 Rogers County contracts with KellPro, Inc. to create and maintain a website for the purpose of publishing text information entered by the County Clerk's office into the KellPro software along with images of documents stored electronically at the clerk's office. Rogers County pays KellPro a fee based on the volume of data stored and KellPro makes copies of the images of land documents accessible for a fee payable to the County Clerk. Alternatively, Defendant charges a fee of five cents per page for an electronic copy of a document from the land records.1 In addition to the Rogers County land records, KellPro publishes records for other county clerks in Oklahoma2 and collects a subscription fee for that service from patrons. The contract between Rogers County and KellPro specifically provides that the electronic data remain the property of the County while KellPro retains its intellectual property rights to its software. ¶4 County Records, Inc. (Plaintiff) is in the business of operating a website that provides land records to on-line subscribers, including the county clerk records for all 77 counties in Oklahoma. In April 2009, Plaintiff requested electronic copies of land records from the County Clerk's office including an electronic copy of the official tract index. The request for an electronic copy of the official tract index was denied based on Defendant's belief that she is legally prohibited from providing it to Plaintiff for its intended commercial sale of the information. In July 2009, Plaintiff filed this declaratory judgment action seeking to compel production of an electronic version of the official tract index and other land records at a reasonable fee. ¶5 Discovery was conducted and on May 21, 2010, Plaintiff moved for summary judgment attaching to its motion: (1) Defendant's response to requests for admissions, (2) the deposition of County Clerk Armstrong, (3) an affidavit of Plaintiff's President, (4) copies of Abstract Affidavits from persons who have obtained photocopies of portions of the official tract index book, (5) the deposition of the County Clerk's computer technician, and (6) the contracts between Rogers County and KellPro. The trial court granted Plaintiff's motion by an order filed December 3, 2010. Defendant brought this accelerated appeal which this court retained on its own motion. The parties were directed to brief the issues. STANDARD OF REVIEW ¶6 Summary judgment is proper only "[i]f it appears to the court that there is no substantial controversy as to the material facts and that one of the parties is entitled to judgment as a matter of law." Rules for Dist. Cts., Okla. Stat. tit.12, ch. 2, app., Rule 13(e) (2011). The trial court's ruling on the legal issue is reviewed de novo as a question of law. Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶ 14, 859 P.2d 1081, 1084. ANALYSIS ¶7 This matter is controlled by the Oklahoma Open Records Act, Okla. Stat. tit. 51, §§24 A. 1 - 24 A. 29 (2011). The stated policy and purpose of the Act is "to ensure and facilitate the public's right of access to and review of government records so they may efficiently and intelligently exercise their inherent political power." Id. § 24 A. 2. The Act provides that "[a]ll records of public bodies and public officials shall be open to any person for inspection, copying, or mechanical reproduction during regular business hours." Id. § 24 A. 5. A record is defined as: all documents, including, but not limited to, any book, paper, photograph, microfilm, data files created by or used with computer software, computer tape, disk, record, sound recording, film recording, video record or other material regardless of physical form or characteristic, created by, received by, under the authority of, or coming into the custody, control or possession of public officials, public bodies, or their representatives in connection with the transaction of public business, the expenditure of public funds or the administering of public property. Id. § 24A.3(1). A number of items are specifically excluded from the definition of "record" including "computer software." Id. § 24A.3(1)(a). The Act sets a copy fee for records and a formula for enhanced fees when a request is solely for a commercial purpose or would cause excessive disruption of the public body that holds the records. Id. § 24A.5(3). ¶8 A special provision of the Open Records Act applies to the county land records: The land description tract index of all recorded instruments concerning real property required to be kept by the county clerk of any county shall be available for inspection or copying in accordance with the provisions of the Oklahoma Open Records Act; provided, however, the index shall not be copied or mechanically reproduced for the purpose of sale of the information. Id. § 24A.5(4). The purpose of this provision is understood when it is considered with the provisions of the Oklahoma Abstractors Act, Okla. Stat. tit.1, §§ 20 - 43 (2011). Pursuant to the Act, abstractors are provided "free access to the instruments of record affecting real property." Id., § 36(A)(1).3 However, "[a]ccess to instruments of record shall be for immediate and lawful abstracting purposes only. The sale of the instruments of record for profit to the public either on the internet or any other such forum by any company holding a permit to build an abstract plant4 is prohibited." Id. § 36(E). Additionally, anyone wishing to enter the business of abstracting "shall have for use in such business an independent set of abstract books or other system of indexes compiled from the instruments of record affecting real estate in the office of the county clerk, and not copied from the indexes in said office." Id. § 28. That is why the Rogers County Clerk requires an affidavit from anyone who obtains paper copies from the tract index. That person must swear that he or she is not in the business of abstracting and that the information will not be reproduced or distributed for sale. ¶9 When the Open Records Act is read with the Abstractors Act, the legislative intent becomes apparent. Production of the official tract index for inspection and copies of the official tract index and instruments of record affecting real estate are not limited unless the request for information from the county records is for the sale of that information. The tract index provision in the Open Records Act extends the prohibition on sale of the county land record information to any person who intends to profit from such a sale. ¶10 The policy underlying the restriction on production of the official tract index is the prevention of the sale of the public records for private profit. It recognizes that the county clerk recoups part of the costs of the personnel and equipment necessary to produce, record, and maintain the land records from the sale of copies of land instruments. This is true whether the information is stored electronically or on paper. ¶11 The Rogers County Clerk was correct to refuse Plaintiff's request for an electronic copy of the tract index based on the tract index restriction contained in the Open Records Act. However, the mandate of that restriction is broader; it prohibits a county clerk from providing any documents and data from the land records for the intentional sale of that information. ¶12 A second and compelling reason for the Rogers County Clerk's refusal to provide an electronic copy of the official tract index is that it does not exist as a discrete electronic document that can be provided in electronic form. The tract index data are entered as text information into the computer system in the county clerk's office using the KellPro software. Those data provide the information that is published on the website for all county clerks in Oklahoma. The information becomes the tool by which electronic copies of real estate instruments are made viewable online. ¶13 The county clerk cannot compile the data and export an electronic image of the tract index to a printer, zip drive, or other device capable of storing a copy of the screen image. There is no electronic replica of the physical books that comprise the official tract index. In other words, once the county clerk enters the tract index information into the KellPro system, those data become inextricably linked to the KellPro software. Because the tract index data are not entered into the system as a document, they cannot be retrieved as a document. Outside the KellPro software, the official tract index information exists as a paper document only. ¶14 Plaintiff argues that its intended use of the tract index data in electronic form is identical to that of KellPro and therefore it has rights to the data equal to KellPro's. That argument fails, however, to account for the fact that KellPro contracts with Rogers County to host a website for public access to the county land records.5 Plaintiff, on the other hand, wants access to the same public data in an electronic format to facilitate the sale of that information for a fee.6 Even if it was physically possible to grant Plaintiff's request, the Open Records Act does not permit Plaintiff to sell the information. ¶15 The trial court's summary judgment for Plaintiff must be reversed. Plaintiff is not legally entitled to the tract index information in electronic form and the county clerk is prohibited by a specific provision in the Open Records Act from providing information from the land records for resale. On remand, the trial court is directed to enter judgment for Defendant. REVERSED AND REMANDED WITH INSTRUCTIONS. CONCUR: Taylor, C.J.; Colbert, V.C.J.; Kauger, Watt, Edmondson, Reif, Gurich, JJ. DISSENT: Winchester, Combs, JJ. FOOTNOTES 1 It was the increase of the fee from two cents per page to five cents which resulted in that part of the declaratory judgment action which challenged the reasonableness of the fee. 2 The site is maintained at www.countyrecords.com. 3 Access is defined as: possession of said instrument to mechanically reproduce it, either in the office or out of the office of filing, at the discretion of the county officer having custody of the instrument, which reproduction shall be completed not later than the close of business of the first business day following the day of receipt of the document. Id. § 36(D). 4 An abstract plant: shall consist of a set of records in which an entry has been made of all documents or matters which legally impart constructive notice of matters affecting title to real property, any interest therein or encumbrances thereon, which are filed, recorded and currently available for reproduction in the offices of the county clerk and the court clerk in the county for which such abstract plant is maintained. Id. § 21(2). 5 Since 1983, counties have been authorized to purchase "electronic data processing equipment" or "enter into a contract for computer services with a capable data processing company." Okla. Stat. tit. 19, § 376(B) (2011). 6 This Court expresses no opinion as to whether the subscription component of the agreement between Rogers County and KellPro is consistent with the Open Records Act. That issue is not before the Court in this matter. WINCHESTER, J., dissenting, with whom COMBS, J. joins: I respectfully dissent. The majority opinion reports the facts that KellPro publishes records for county clerks in Oklahoma and collects a subscription fee for that service from patrons. The contract between Rogers County and KellPro provides that electronic data remain the property of the county, but that KellPro retains its intellectual property rights to its software. Finally, the opinion reports that County Records, Inc., the plaintiff/appellee also provides land records to online subscribers, including county clerk records for all 77 counties in Oklahoma. County Records, Inc. seeks data in the form of electronic copies of land records from the Rogers County Clerk, including an electronic copy of the official tract index. In the Oklahoma Open Records Act, "data files created by or used with computer software" is included in the definition of a record.1 A tract index whether it is hand written or entered as data is an indispensible tool to research the land record in a county. It is the list of public documents filed on a tract of property, and includes deeds, mortgages, mineral leases and other documents that affect the specific property. This is an index providing access to books to locate and view the filed documents. Without a tract index it would be impossible to find documents for a specific piece of property. Our property system is dependent on these records being accurately kept by the county clerk and deputies, who make these documents available so the public can search land records. Maintaining and entering documents on the tract index is an integral part of the elected position of county clerk. After the World Wide Web was invented in 1989,2 more and more people and businesses used the Internet to access electronic data. As a service to the public, the Rogers County Court Clerk contracted with KellPro to provide a county website and provide a search capacity for the records. The money for this service came from public funds and county deputies were paid by public funds to enter the documents of public records as data on computers paid for with public funds. KellPro provided the software they used. I agree with the Court that KellPro should not be ordered to turn over their proprietary software to County Records, Inc. I cannot accept the majority view that the county clerk and her deputies, as public employees, can pay KellPro public funds to enter public records for KellPro's private use. KellPro then charges the public for subscriptions to access the public record it received from the labor of public employees. The majority opinion dismisses this private benefit to KellPro in a footnote by concluding the issue is not before the Court. The majority opinion prevents County Records from obtaining the same information KellPro received because the Court has determined it "does not exist as a discrete electronic document that can be provided in electronic form." If KellPro is given the information at public expense, then County Records, Inc., or any other private entity should be able to acquire an electronic copy of the data and create its own computer software to search the public documents. The trial court found that the county clerk has the ability to produce those records; the issue was pricing. Regarding the provision of the Open Records Act that states "the index shall not be copied or mechanically reproduced for the purpose of sale of the information," KellPro is currently making available public documents from data entered into its computers by public employees, for its own profit. County Records, Inc. wishes to have access to the same public data and compete. I do not believe such access constitutes a sale of information under the Act. That provision in the Open Records Act, 51 O.S.2011, § 24A.5(4), was enacted in 19863 and does not appear to contemplate the widespread use of the internet to access public information. The enactment of that language preceded the introduction of the World Wide Web, and allowing public access to public documents is clearly compatible with the public policy and purpose of the Open Records Act.4 Making those public documents available on the internet should be allowed and encouraged. Title 68 O.S.2011, § 2864(f) already requires the county assessor to provide property data in an electronic or digital format for a fee, which is set by the State Board of Equalization. I would remand this case and require KellPro to be added as a party since they appear to be the only company presently allowed to provide this public information. Public records are still public even though they are inputted into KellPro software. The district court should be able to fashion a remedy to resolve this problem and at a fair price. FOOTNOTES 1 51 O.S.2011, § 24A.3(1) 2 http://www.w3.org/Consortium/facts#history, accessed June 12, 2012. 3 1986 Okla.Sess.Laws, ch. 213, § 1. 4 51 O.S.2011, § 24 A. 2.

05bacd02-be40-46b5-bf97-3d291f8d5bf9

AOF/Shadybrook Affordable Housing Corp. v. Yazel

oklahoma

Oklahoma Supreme Court

AOF/SHADYBROOK AFFORDABLE HOUSING CORPORATION v. YAZEL2012 OK 59Case Number: 107508Decided: 06/19/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. AOF/SHADYBROOK AFFORDABLE HOUSING CORPORATION, an Oklahoma not-for-profit corporation, Plaintiff-Appellee,v.KEN YAZEL, TULSA COUNTY ASSESSOR,andTULSA COUNTY ex rel. TULSA COUNTY BOARD OF EQUALIZATION and DENNIS SEMLER, TULSA COUNTY TREASURER, Defendants-Appellants. ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY,STATE OF OKLAHOMA,HONORABLE P. THOMAS THORNBRUGH ¶0 The Tulsa County Assessor's office assessed ad valorem taxes on the Shadybrook Apartment Complex for the years 2004, 2005, and 2006. Shadybrook, under protest, timely paid the taxes each year, but appealed the Assessor's valuation to the Tulsa County Board of Tax Roll Corrections and the Tulsa County Board of Equalization. After receiving unfavorable decisions, Shadybrook appealed to the district court. The trial court granted summary judgment in favor of Shadybrook, determining that Shadybrook qualified for an exemption from ad valorem taxation pursuant to the Oklahoma Constitution, Article 10, § 6A. The Assessor appealed. On the first appeal in this case, the Court of Civil Appeals, Division IV, upheld the trial court's ruling in part but reversed and remanded with instructions to the trial court to determine whether Shadybrook's use of the property was for charitable purposes under Article 10, § 6A so as to overcome this Court's ruling in London Square Village v. Oklahoma County Equalization and Excise Board.1 Neither party petitioned this Court for certiorari from that opinion. On remand, the trial court found in favor of Shadybrook and the Assessor appealed. We retained the appeal. We hold that Shadybrook's operation of the low-income housing complex was a charitable use under the constitutional ad valorem tax exemption in Article 10, § 6A of the Oklahoma Constitution. The statutory language in 68 O.S. 2004 § 2887(8)(a)(2)(b) excluding property funded with proceeds from the sale of federally tax-exempt bonds from ad valorem exemption is unconstitutional.2 London Square Village is overruled. AFFIRMED Mark R. Reents, Clark & Williams, Tulsa, Oklahoma, for Plaintiff-AppelleeLeisa S. Weintraub, Tulsa County Assessor's Office, Tulsa, Oklahoma, for Defendants-Appellants GURICH, J. Facts & Procedural History ¶1 This is an appeal from the Journal Entry of Judgment, filed on September 22, 2009, in Tulsa County, Honorable P. Thomas Thornbrugh.3 The case involves the assessment of ad valorem taxes on the Shadybrook Apartments for the years 2004, 2005, and 2006.4 AOF/Shadybrook Affordable Housing Corporation is an Oklahoma not-for-profit corporation.5 In 1998, AOF acquired Shadybrook using proceeds from the sale of Tulsa County Industrial Revenue Bonds. The income from those bonds is exempt from federal income tax.6 ¶2 The Shadybrook apartment complex is located in Tulsa and consists of 120 one-bedroom apartment units. Shadybrook was rented almost exclusively to persons of little financial means who were either disabled or over the age of sixty-two (62). Annual Department of Housing and Urban Development Income Guidelines were used in determining tenant eligibility. Income of the tenants at Shadybrook fell primarily in the "Extremely Low" and "Very Low" income categories for the years 2004, 2005, and 2006.7 ¶3 The fair market rent established for Shadybrook was $559.00 per month. While the rent paid by every tenant was based on his or her ability to pay, all tenants were required to pay a minimum $25.00 contribution. Except for one or two HUD-approved tenants who paid fair market rent, no tenant paid the total cost of rent. The rent receipts collected at Shadybrook were applied to the upkeep, maintenance, and equipment of the Shadybrook Apartments, and all residents occupying Shadybrook received the same treatment, regardless of the amount of rent they paid.8 ¶4 From 1998 through 2003, the Tulsa County Assessor granted Shadybrook an exemption from ad valorem taxation pursuant to 68 O.S. § 2887(8) because Shadybrook was organized as a charitable institution and satisfied the income standards of IRS Revenue Procedure 96-32. ¶5 However, in 2003, § 2887(8) was amended to exclude properties acquired or improved with proceeds from the sale of federally tax-exempt bonds.9 Because Shadybrook was acquired with proceeds from the sale of federally tax-exempt bonds, the Assessor's office assessed ad valorem taxes on Shadybrook beginning in 2004 and ending in October of 2006 when AOF sold the property.10 The taxes assessed against Shadybrook were $41,530.00 in 2004; $39,847.00 in 2005; and $40,847.00 in 2006. Shadybrook, under protest, timely paid the taxes each year, but appealed the Assessor's valuation to the Tulsa County Board of Tax Roll Corrections and the Tulsa County Board of Equalization.11 ¶6 At each administrative hearing, Shadybrook objected to being taxed, claiming exemption from ad valorem taxation under Article 10, § 6A of the Oklahoma Constitution. The Assessor's office argued that since Shadybrook was acquired with proceeds from the sale of federally tax-exempt bonds, Shadybrook was not exempt from ad valorem taxes under 68 O.S. 2004 § 2887(8)(a)(2)(b). Both Boards denied Shadybrook's request for exemption from payment of ad valorem taxes. Shadybrook timely appealed the Boards' rulings to the district court of Tulsa County. ¶7 On appeal to the district court, the parties did not dispute that Shadybrook fell within the exception to exemption stated in 68 O.S. 2004 § 2887(8)(a)(2)(b). However, Shadybrook argued that the exception was invalid under the Oklahoma Constitution because it imposed stricter requirements for exemption from ad valorem taxation than those set by the Oklahoma Constitution.12 Although the Assessor treated Shadybrook as a charitable institution from 1998 to 2003, the Assessor argued in response that even if the statute imposed greater burdens on the exemption than allowed by the Constitution, the property was not being used for charitable purposes and not exempt from ad valorem taxes. ¶8 The trial court granted Shadybrook's motion for summary judgment, finding that 68 O.S. 2004 § 2887(8)(a)(2)(b) imposed impermissible barriers on the exemption of property in charitable use beyond those provided for in Article 10, § 6A of the Oklahoma Constitution. The Assessor appealed. ¶9 In the first appeal in this case, the Court of Civil Appeals held that "if AOF's use of Shadybrook constitute[d] a charitable purpose, then § 2887(8)(a)(2)(b) would impose a greater burden on the receipt of the Article 10, § 6A charitable exemption than does the Constitution."13 COCA upheld the trial court's ruling in part but reversed and remanded for further proceedings in the trial court to determine the factual issue of whether Shadybrook's use of the property was for charitable purposes under Article 10, § 6A, "so as to overcome the Supreme Court's ruling in London Square Village v. Okla. County Equalization and Excise Board."14 ¶10 On remand, the trial court held a bench trial to determine these issues. The trial court held that Shadybrook was "physically dedicated to a charitable purpose" under Article 10, § 6A of the Oklahoma Constitution and that Shadybrook's use of the property during 2004, 2005, and 2006 did not fall under the rule announced by this Court in London Square Village. The Assessor's office timely appealed this judgment, filing a Petition in Error and a Motion to Retain the appeal in the Supreme Court. This Court granted the Assessor's motion on November 16, 2009, and retained the appeal.15 Standard of Review ¶11 Whether property is being used exclusively for charitable purposes so as to qualify for the Article 10, § 6A exemption from ad valorem taxation presents a question of law concerning the scope of the constitutionally mandated exemption. Integris, 2002 OK 85, ¶ 6, 58 P.3d at 203. Questions of law are reviewed de novo, which necessitates a plenary, independent, and non-deferential examination of the trial court's legal rulings. Id. This Court has long held that whether property is exempt from taxation under Article 10, § 6A depends on whether it was actually used for charitable purposes as determined by the facts in evidence and that each case must stand on its own merits. In re Farmers' Union Hosp. Ass'n of Elk City, 1942 OK 128, ¶ 8, 126 P.2d 244, 246.16 The burden of proving the existence of an exemption is on the individual seeking the exemption, and constitutional provisions are strictly construed against those claiming the exemption. Austin, Nichols & Co. v. Okla. Cnty. Board of Tax-Roll Corrections, 1978 OK 65, ¶ 19, 578 P.2d 1200, 1203-04. Analysis ¶12 Article 10, § 6A of the Oklahoma Constitution states: "Except as otherwise provided in subsection B of this section, all property used for free public libraries, free museums, public cemeteries, property used exclusively for nonprofit schools and colleges, and all property used exclusively for religious and charitable purposes . . . shall be exempt from taxation."17 In this Court's most recent discussion of the charitable use exemption in Integris, several Integris-related nonprofit, charitable entities used office space in a multi-story office building for charitable, educational, and scientific purposes and sought a pro rata exemption from ad valorem taxation. Integris, 2002 OK 85, ¶ 2, 58 P.3d at 202. Even though the entity that owned the building was not a charitable organization and part of the building was leased to for-profit entities that were not charitable, this Court allowed an exemption for the portion of the building that was physically used for charitable purposes. Id. ¶ 16, 58 P.3d at 206. We stated that the proper interpretation of the words "used exclusively for charitable purposes" in Article 10, § 6A is "the use to which the property is dedicated and devoted." Id. ¶ 9, 58 P.3d at 204. Physical use to which the property is dedicated and devoted is determinative. Id. ¶13 While Integris reaffirmed that the physical use of the property determines whether an entity is charitable under Article 10, § 6A, the facts in that case differ significantly from the facts of today's case. London Square Village is factually similar to today's case. Because London Square Village provides only limited guidance, the trial court, in deciding whether Shadybrook used the property for a charitable purpose, applied a seven-factor test this Court cited favorably in Glass v. Oklahoma Methodist Home for the Aged, 1972 OK 135, ¶ 21, 502 P.2d 1268, 1273, and later in Baptist Health Care Corp. v. Okmulgee County Board of Equalization, 1988 OK 11, ¶ 10, 750 P.2d 127, 130 n.3.18 ¶14 This seven-factor test is precedential authority in charitable use exemption cases involving care centers for the elderly, like those in Glass and Baptist Health Care Corp., and we expressly adopt it today as authority in cases involving low-income housing complexes. We reiterate, however, that the physical use to which the property is dedicated and devoted is determinative and that these factors are only relevant to the extent they indicate whether the questioned entity's physical use of the property is dedicated and devoted to a charitable purpose. See Integris 2002 OK 85, ¶ 9, 58 P.3d at 204. ¶15 The parties agreed, and the trial court found, that only three of the seven factors were disputed: (1) Were the Shadybrook facilities open to all regardless of ability to pay? (2) Were donations made for the use of needy persons? (3) Did Shadybrook operate without a profit or private advantage to its founders and officials in charge? Shadybrook Facilities Were Open to All Regardless of Ability to Pay ¶16 The trial court first addressed whether the Shadybrook facilities were open to all regardless of ability to pay. The Assessor argued that Shadybrook was not open to all regardless of their ability to pay because HUD rules required tenants, even those with no apparent incomes, to pay a $25.00 per month contribution for operating costs of the facility. ¶17 Assistance does not have to be cost-free for an organization to qualify as an exclusively charitable organization, and a minimum contribution from residents does not preclude an organization from having a charitable purpose. In Tulsa County v. St. John's Hospital, 1948 OK 84, 191 P.2d 983, we held that a hospital owned and managed by a corporation organized for benevolent purposes, which had no capital stock, dividends, salary, wage, or pecuniary profits, which devoted all its income to caring for the sick and injured, and which received and cared for patients without discrimination, was a charitable institution regardless of the fact that it charged and received pay for patients able to pay. Other jurisdictions have also found that assistance does not have to be cost free for an organization to qualify as an exclusively charitable organization.19 ¶18 In this case, the record reflects that all Shadybrook residents received the benefits provided by the complex regardless of whether they could make the required minimum contribution. Shadybrook's occupancy manager testified that even though each tenant paid a different amount of reduced rent, all tenants received the same services regardless of the amount of rent they paid. In fact, the trial court found that Shadybrook extended its benefits to some individuals who could not make the reduced rent payments. The trial court was correct in concluding that the Shadybrook facilities were open to all regardless of ability to pay. Regardless of Federal Funding, Shadybrook's Purpose Was Charitable ¶19 The trial court next addressed whether there were donations made for the use of needy persons. The Assessor argued that because operational expenses and debt service were paid almost entirely with HUD subsidies, Shadybrook's use of the property for low-income housing was not for a charitable purpose. ¶20 We recently considered the charitable use exemption in Integris: The framers of Oklahoma's Constitution no doubt were mindful that charitable institutions . . . provide services which relieve the State of burdens which it would otherwise have to bear and in crafting the art. 10, § 6 tax-exemption intended to foster such charitable acts. . . . In recognition of the burden on state government which is lifted by the charitable acts of others, the framers allow an exemption from taxation for property which is "used exclusively" - i.e. property which is physically dedicated and devoted - for charitable purposes.20 ¶21 In this case, the record indicates that Shadybrook's use of HUD subsidies to operate the apartment complex reduced the burden that might otherwise rest on the State of Oklahoma to provide such low-income housing to the elderly and disabled population. In tax years 2004, 2005, and 2006, only three tenants were financially capable of paying and were charged fair market rent. The remaining 118-119 tenants paid substantially lower rent than fair market rent. Without the HUD subsidies, only three of the approximately 120 tenants could have lived at Shadybrook. The HUD subsidies alone allowed Shadybrook to continue to make the apartments available to its elderly and disabled tenants while still paying its operating expenses. From the perspective of the tenants, Shadybrook provided a safe and decent place to live; it made no difference to them whether funding came from a private citizen or via the federal government. We find that regardless of the source of the funding, the end result in this case furthered Shadybrook's charitable purpose and relieved the State of Oklahoma of burdens it might otherwise have to bear. Shadybrook Did Not Operate to the Private Advantage of Founders or Officials in Charge ¶22 Finally, the trial court addressed whether Shadybrook operated without a profit or private advantage to its founders and officials in charge. The Assessor argued that Shadybrook may have operated to the private advantage of Jack T. Hammer, a majority stockholder in the HSI Company, which provided management services to Shadybook. ¶23 The record indicates that AOF President, Phil Kennedy testified that HSI was entitled to a maximum one percent (1%) of the gross revenues of the Shadybrook complex in return for its management services.21 Mr. Kennedy testified that this typically amounted to between five and six hundred dollars per month, or approximately five dollars per apartment. However, he also testified that no actual payment had been made to HSI during any of the tax years in question because the economic conditions of the property would not support the payment. Mr. Kennedy further testified that the HSI payments had accrued, however, and could potentially be claimed in the future. ¶24 The record is clear that during the tax assessment years in question, Mr. Hammer did not receive any private gain because no actual payment was made to HSI during 2004, 2005, or 2006. The economic conditions of the property could not support the payment. Additionally, it is not clear from the record whether Mr. Hammer will ever receive the payments under the HSI management contract. As such, we find that because Mr. Hammer did not receive private gain during the tax assessment years in question, this factor does not preclude Shadybrook from the claimed constitutional exemption. The Trial Court Correctly Prorated a Portion of the Complex for Tenants Who Paid Fair Market Rent ¶25 After weighing these factors and determining that Shadybrook's use of the property was for a charitable purpose under the Oklahoma Constitution, the trial court addressed whether the presence of a small number of tenants who paid the fair market rent affected Shadybrook's tax-exempt status. Oklahoma precedent on this issue is clear. Non-charitable use of a portion of a property otherwise dedicated to a charitable use results in pro rata taxation of the non-charitable portion. Integris, 2002 OK 85, ¶ 11, 58 P.3d at 204; Oklahoma Cnty. v. Queen City Lodge No. 197, 1945 OK 55, ¶ 62, 156 P.2d 340, 354. We find the trial court was correct in prorating a portion of the complex based on the tenants who paid fair market rent.22 London Square Village Is Overruled ¶26 Since London Square Village was decided in 1976,23 the Oklahoma Legislature has amended the ad valorem tax code to exempt from ad valorem taxation low-income housing complexes that satisfy the statutory requirements. In 1988, 68 O.S. §§ 2401 et seq. was repealed and replaced by 68 O.S. §§ 2801 et seq. Included in the new ad valorem tax code was § 2887.24 As originally enacted, it provided: The following property shall be exempt from ad valorem taxation: . . . . 8. All property of any charitable institution organized or chartered under the laws of this state as a nonprofit or charitable institution, provided the net income from such property is used exclusively within this state for charitable purposes and no part of such income inures to the benefit of any private stockholder. 68 O.S. 1992 § 2887(8). In 2000, § 2887 was amended to read: The following property shall be exempt from ad valorem taxation: . . . . 8. All property of any charitable institution organized or chartered under the laws of this state as a nonprofit or charitable institution . . . which additionally satisfies the income standards set forth in Internal Revenue Service Revenue Procedure 96-32 if the property provides residential rental accommodations regardless of whether services or meals are provided. 68 O.S. 2001 § 2887(8) (emphasis added).25 ¶27 Revenue Procedure 96-32 sets forth a safe harbor under which organizations that provide low-income housing will be considered charitable. It provides objective income and occupancy requirements, and those organizations that meet the objective criteria are considered to have a charitable purpose under the Internal Revenue Code. The Internal Revenue Code defines charitable as: Relief of the poor and distressed or of the underprivileged; advancement of religion; advancement of education or science; erection or maintenance of public buildings, monuments, or works; lessening of the burdens of Government; and promotion of social welfare by organizations designed to accomplish any of the above purposes, or (i) to lessen neighborhood tensions; (ii) to eliminate prejudice and discrimination; (iii) to defend human and civil rights secured by law; or (iv) to combat community deterioration and juvenile delinquency. 26 C.F.R. § 1.501(c)(3)-1(d)(2) (2012) (emphasis added).26 ¶28 Before the most recent amendment to 68 O.S. § 2887 in 2003, most low-income housing complexes were exempt from ad valorem taxation in Oklahoma so long as they satisfied the requirements of Revenue Procedure 96-32 and other statutory requirements. The holding in London Square Village essentially became obsolete as most assessors looked to 68 O.S. § 2887(8) and Revenue Procedure 96-32 to decide if a housing complex was exempt. In fact, the Assessor treated Shadybrook as a charitable organization and exempted it from ad valorem taxes from 1998-2003. ¶29 In 2003, the legislature again amended 68 O.S. § 2887(8). The amendment prevented complexes improved or acquired with proceeds from the sale of federally tax-exempt bonds from receiving the ad valorem tax exemption. While the amendment put Shadybrook back on the county tax rolls because it was acquired with proceeds from the sale of federally tax-exempt bonds, Shadybrook continued to provide beneficial social services to its elderly and disabled tenants that relieved the state of burdens it might otherwise have to bear.27 Likewise, it continued to qualify as a charitable organization under Revenue Procedure 96-32. ¶30 Courts must "recognize that the concept of charity evolves over time to take into account the changing needs of society, new discoveries, and the varying conditions, characters, and needs of different communities."28 What qualifies as an exclusively charitable purpose is "'subject to judgment in the light of changing community mores.'"29 While Revenue Procedure 96-32 does not dictate whether a use is charitable under the Oklahoma Constitution, the Legislature's use of Revenue Procedure 96-32 to determine whether a complex is exempt from ad valorem taxation reflects the altered environment in Oklahoma since this Court's decision in London Square Village.30 The definition of charitable in Revenue Procedure 96-32 is consistent with this Court's most recent discussion of charitable in Integris. As such, we overrule London Square Village. We are persuaded by the dissent in London Square Village, which recognized that "it is academic that charity is not confined to almsgiving or relief of poverty and distress but has a broader signification, embracing the improvement and happiness of man. . . . Although . . . only families of low income may receive direct benefit from the housing project, all persons in the community benefit indirectly. Charity of this type tends to be of a most practical character." London Square Village, 1976 OK 159, 559 P.2d at 1227-28 (Doolin, J., dissenting ¶ 9).31 68 O.S. 2004 § 2887(8)(a)(2)(b) as Amended is Unconstitutional ¶31 Because Shadybrook has demonstrated that its property was used exclusively for charitable purposes under the Oklahoma Constitution, we agree with the trial court that the statute in question is unconstitutional to the extent it imposes stricter requirements for exemption from ad valorem taxation than those set by § 6A. The constitutional ad valorem tax exemption is not conditioned upon whether a property is purchased with proceeds from the sale of federally tax-exempt bonds. Rather, § 6A requires only that an entity be used exclusively for charitable purposes. Therefore, the statutory language in 68 O.S. 2004 § 2887(8)(a)(2)(b)32 excluding property funded with proceeds from the sale of federally tax-exempt bonds from ad valorem exemption is unconstitutional to the extent it creates a burden on entitlement to the § 6A exemption. Conclusion ¶32 We find that Shadybrook has overcome its burden of proving the existence of an exemption and has demonstrated that its operation of the low-income housing complex was a charitable use entitling it to the ad valorem tax exemption in § 6A. London Square Village is overruled. The statutory language in 68 O.S. 2004 § 2887(8)(a)(2)(b) excluding property funded with proceeds from the sale of federally tax-exempt bonds from ad valorem exemption is unconstitutional. We affirm the trial court's order in all respects. AFFIRMED ¶33 COLBERT, V.C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, REIF, COMBS, GURICH, JJ. - CONCUR ¶34 TAYLOR, C.J. - DISSENTS FOOTNOTES 1 1976 OK 159, 559 P.2d 1224. 2 [N]o asset consisting of a single-family or multi-family dwelling unit owned by an entity the property of which would otherwise be exempt pursuant to subparagraph a of this paragraph shall be exempt from ad valorem taxation if any such dwelling unit was improved with or acquired with any portion of proceeds from the sale of obligations issued by any entity organized pursuant to § 176 of Title 60 of the Oklahoma Statutes if the interest income derived from such obligations is exempt from federal income tax . . . . 68 O.S. 2004 § 2887(8)(a)(2)(b). 3 On March 28, 2009, the trial court issued a thirty-five page final order in the case, which included extensive findings of fact and conclusions of law. On April 2, 2009, the Assessor filed a Motion to Correct, Modify, Vacate or Reconsider Final Order. On September 22, 2009, the trial court issued a Journal Entry of Judgment in the case, denying the Assessor's motion and incorporating by reference its Final Order issued on March 28, 2009. 4 Because the issues were the same for all three years, the trial court consolidated the cases. 5 AOF is a subordinate of The American Opportunity Foundation, Inc., a Georgia 501(c)(3) corporation, which is exempt from federal income taxation under § 501(c)(3) of the Internal Revenue Code and which receives a group exemption as a central organization whose subordinates are recognized as exempt from federal taxation under § 501(c)(3). 6 The Tulsa County Industrial Authority is an entity organized pursuant to 60 O.S. § 176. 7 In 2004, 90% of the tenants were categorized as either extremely low or very low; in 2005, 98% of the tenants were categorized as extremely low or very low; and in 2006, 95% of the tenants were categorized as extremely low or very low. Shadybrook's occupancy manager testified that during 2004, 2005, and 2006, extremely low income for one person would have been a gross annual income between $0 and $11,450.00. Very low income for one person would have been a gross annual income between $11,450.00 and $19,100.00. 8 The difference between what the tenant was charged and the fair market rent was the subsidy Shadybrook received from HUD, which allowed Shadybrook to continue to make the apartments available to low-income clients. 9 68 O.S. 2004 § 2887(8)(a)(2)(b) provides: The following property shall be exempt from ad valorem taxation: . . . . 8. All property of any charitable institution organized or chartered under the laws of this state as a nonprofit or charitable institution, provided the net income from such property is used exclusively within this state for charitable purposes and no part of such income inures to the benefit of any private stockholder, including a property which is not leased or rented to any person other than a governmental body, a charitable institution or a member of the general public who is authorized to be a tenant in property owned by a charitable institution under § 501(c)(3) of the Internal Revenue Code and which includes but is not limited to an institution that either: a. additionally satisfies the income standards set forth in Internal Revenue Service Revenue Procedure 96-32, which may be audited by the county assessor of the applicable county, in addition to other requirements of this subparagraph, as a condition of obtaining and maintaining the exemption, if: (1) the property provides residential rental accommodations regardless of whether services or meals are provided, and (2) the property: (a) is occupied as of the applicable January 1 assessment date if the structure is a single-family dwelling, or (b) has an average seventy-five percent (75%) occupancy rate, based upon the total number of units suitable for occupancy, during the calendar year preceding the applicable January 1 assessment date if the property contains multiple structures suitable for multi-family housing. The owner of any property subject to the occupancy requirements prescribed herein shall submit a report to the county assessor of the county in which the property is located no later than December 15 each year regarding the occupancy rate for the preceding eleven (11) months. If the report indicates that the average occupancy rate was less than seventy-five percent (75%), the county assessor shall determine the taxable value of the property for the succeeding assessment year and the property shall not be exempt for any subsequent assessment year unless the average occupancy rate is at least seventy-five percent (75%) during the succeeding eleven-month period. No asset consisting of a single-family or multi-family dwelling unit owned by an entity the property of which would otherwise be exempt pursuant to subparagraph a of this paragraph shall be exempt from ad valorem taxation if any such dwelling unit was improved with or acquired with any portion of proceeds from the sale of obligations issued by any entity organized pursuant to Section 176 of Title 60 of the Oklahoma Statutes if the interest income derived from such obligations is exempt from federal income tax . . . . 68 O.S. 2004 § 2887(8)(a)(2)(b) (emphasis added). The amendment became effective January 1, 2004. 10 The years in question regarding this dispute are (1) the taxes for calendar year 2004, beginning on January 1, 2004, and ending on December 31, 2004; (2) the taxes for calendar year 2005, beginning January 1, 2005, and ending December 31, 2005; and (3) the taxes for a portion of calendar year 2006, beginning on January 1, 2006, and ending on October 31, 2006. 11 Shadybrook properly and timely filed all appeals before the Boards. 12 To be exempt from ad valorem taxation under Article 10, § 6A of the Oklahoma Constitution, a property must be used exclusively for charitable purposes. To be exempt from ad valorem taxation under 68 O.S. 2004 § 2887(8)(a)(2)(b), a property must qualify as charitable and not be funded by proceeds from the sale of federally tax-exempt bonds. Shadybrook argues that 68 O.S. 2004 § 2887(8)(a)(2)(b)'s additional requirement excluding property funded with proceeds from the sale of federally tax-exempt bonds from ad valorem exemption imposes stricter requirements for exemption than required by the Oklahoma Constitution. For this Court to declare the statute unconstitutional, Shadybrook must demonstrate that its use of the property was charitable under the Oklahoma Constitution. See In the Matter of the Assessment of Real Prop. of Integris Realty Corp., 2002 OK 85, 58 P.3d 200. 13 AOF/Shadybrook Affordable Housing Corp. v. Ken Yazel, et al., Case No. 105,645, at 11 (June 20, 2008) (unpublished) (emphasis added). 14 Id. at 18. On the first appeal in this case, the Assessor also argued that AOF was forbidden under the trust code to use tax-exempt property for the housing project. COCA found that the Assessor's argument failed to disclose how a violation of the trust code was determinative of whether the property qualified for the charitable use tax exemption. COCA affirmed the trial court on this issue. Additionally, AOF conceded that a small fraction of its property did not qualify for the charitable exemption, so the trial court calculated the fraction and the tax. COCA also affirmed this portion of the trial court's order. 15 The case was assigned to my chambers for review on February 24, 2011. 16 See also Immanuel Baptist Church v. Glass, 1972 OK 79, ¶ 12, 497 P.2d 757, 760; Okla. Cnty. v. Queen City Lodge No. 197, 1945 OK 55, ¶ 22, 156 P.2d 340, 346. 17 Okla. Const. art. X, § 6A. 18 Both in Glass and Baptist Health Care Corp., this Court cited the Oregon Supreme Court's decision in Oregon Methodist Homes, Inc., v. Horn, 360 P.2d 293, 298-303 (1961), where the Oregon Supreme Court listed these seven factors to consider in determining whether a property is being used exclusively for charitable purposes. The factors include: (1) are rent receipts applied to upkeep, maintenance, and equipment of the institution? (2) do residents receive the same treatment, regardless of race, creed, color, religion, or ability to pay? (3) are the facilities open to all, regardless of race, creed, color, religion, or ability to pay? (4) are charges made to all residents and, if made, are lesser charges made to the poor or are any charges made to the indigent? (5) is there a charitable trust fund created by benevolent and charitably minded persons for the needy or are donations made for the use of such persons? (6) does the institution operate without a profit or private advantage to its founders and officials in charge? (7) do the articles or bylaws of the corporation make provision for the disposition of surplus assets upon dissolution? Baptist Health Care Corp., 1988 OK 11, ¶ 10, 750 P.2d at 130 n.3. 19 See, e.g., Yorgason v. Cnty. Bd. of Equalization of Salt Lake Cnty., ex rel. Episcopal Mgmt. Corp., 714 P.2d 653, 660 (Utah 1986); Santa Catalina Island Conservancy Grp. v. Cnty. of Los Angeles, 178 Cal. Rptr. 708, 716 (1981); Belle Harbor Home of the Sages v. Tishelman, 420 N.Y.S.2d 343, 345 (1979); Martin Luther Homes v. Cnty. of Los Angeles, 90 Cal. Rptr. 524, 527 (1970). 20 See also Cox v. Dillingham, 1947 OK 250, ¶ 17, 184 P.2d 976, 979-80. "[O]ur Constitution . . . is plain and unambiguous, and . . . it is apparent that the framers of that instrument sought to encourage and assist institutions of learning and charitable and other institutions, which are beneficial to the state, and to some extent relieve the government of some of its burdens." (emphasis added). Jurisdictions are split on the question of whether federal funding is the equivalent of outside private donations when determining whether an entity has a charitable purpose. See, e.g., Housing Southwest, Inc. v. Washington Cnty., 913 P.2d 68, 72 (Idaho 1996) (there is no legislative direction that indicates federal subsidies qualify as donations); Yorgason, 714 P.2d at 657, 660 (use of the property is determinative, and it is irrelevant that the government, rather than a private benefactor, makes up the defecit); Fransican Tertiary Province v. State Tax Comm'n, 566 S.W.2d 213, 223 (Mo. 1978) (federal subsidies have the same effect as charitable contributions from the private sector). 21 The HSI management contract was HUD-approved and at a fair market rate for the services provided. 22 After prorating the portions of the property not dedicated to a charitable use, the trial court found that the Tulsa County Treasurer should refund Shadybrook $41,184.00 for tax year 2004, $39,514.00 for tax year 2005, and $33,452.00 for tax year 2006. Neither party has suggested that the trial court's calculations were incorrect. 23 In London Square Village, the plaintiff was a not-for-profit corporation whose purpose was to provide housing for low and moderate income families. London Square Village, 1976 OK 159, ¶ 2, 559 P.2d at 1224. Through federally guaranteed loans, the London Square Village apartment complex was constructed to provide such low-income housing. Apartments in the complex were rented to all members of the public, and all renters, rich and poor alike, were required to pay rent. Id. ¶ 12, 559 P.2d at 1226. Renters could apply to HUD for rent supplements, and those supplements were granted on the basis of an applicant's ability to pay. Id. Renters who were eligible to receive rent supplements under HUD standards included the elderly, physically handicapped, persons displaced from their homes by urban renewal or disaster, and military personnel on active duty. Id. London Square Village collected rent from each tenant less the amount of supplement received from HUD. From those payments, the complex paid operating expenses and mortgage payments. This Court held that the London Square Village apartment complex was not exempt from ad valorem taxes because although low-income housing for such persons "was a worthwhile cause of beneficial interest to society," the apartment complex was not used exclusively for charitable purposes when each and every occupant was required to pay for accommodations. Id. 24 The statute at issue in London Square Village, 68 O.S. 1971 § 2405, was the precursor to the statute at issue in this case. 25 In 2001, § 2887(8) was amended again. The amendment divided the existing paragraph 8 into an introductory paragraph and subparagraphs (a) and (b). It provided: The following property shall be exempt from ad valorem taxation: . . . . 8. All property of any charitable institution organized or chartered under the laws of this state as a nonprofit or charitable institution, . . . and which includes but is not limited to an institution that either: a. additionally satisfies the income standards set forth in Internal Revenue Service Revenue Procedure 96-32 if the property provides residential rental accommodations regardless of whether services or meals are provided, or b. is a continuum of care retirement community providing housing for the aged, licensed under Oklahoma law, owned by a nonprofit entity recognized by the Internal Revenue Service as a § 501(c)(3) tax-exempt entity and located in a county with a population of more than five hundred thousand (500,000) according the latest Federal Decennial Census. 68 O.S. 2002 § 2887(8). In 2003, § 2887(8) was again amended. This amendment provided the exception to the exemption that is at issue in this case. See supra n.9. Although § 2887(8)(a)(2)(b) was amended in 2010 to include "Except as provided in Section 178.6 of Title 60 of the Oklahoma Statutes," the exception to the exemption remains. 26 This definition of charitable is consistent with this Court's most recent discussion in Integris of the charitable use exemption. There we stated that "charitable institutions . . . provide services which relieve the State of burdens which it would otherwise have to bear." Integris, 2002 OK 85, ¶ 12, 58 P.3d at 205 (emphasis added). 27 For example, Shadybrook received and administered a federal grant to pay for a Service Coordinator who assessed, evaluated, and resolved any physical or emotional needs of the tenants. If necessary, Shadybrook worked with the tenants' grown children to advise them of any abnormal behavior exhibited by the adult parent. Shadybrook also helped tenants receive medical, eye, and dental services, arranged for $1.00 telephone services for the tenants, held programs four times per month addressing fire protection, health issues, and security, and arranged transportation for the tenants to do their grocery shopping. Shadybrook provided these services to its tenants regardless of whether a tenant could pay his or her rent. Shadybrook managed to provide these services while operating without a profit. 28 Evelyn Brody, All Charities Are Property-Tax Exempt, But Some Charities Are More Exempt Than Others, 44 New. Eng. L. Rev. 621, 635 (2010). 29 Yorgason, 714 P.2d at 656. 30 "Stare decisis should be more than a fine sounding phrase [and] a substantial departure from precedent can only be justified . . . in the light of experience with the application of the rule to be abandoned or in the light of an altered historic environment." GEICO v. Quine, 2011 OK 88, n.5, 264 P.3d 1245, 1249 n.5 (citing Phillips v. Okla. Tax Comm'n, 1978 OK 34, ¶ 48, 577 P.2d 1278, 1285-1286 (citations omitted)). 31 Although the apartments at the London Square Village complex were rented to the elderly, physically handicapped, persons displaced from their homes by urban renewal or disaster, and military personnel on active duty and Shadybrook was rented primarily to elderly and disabled tenants, See supra ¶ 2, we find that financial ability to pay under HUD standards was the deciding criteria in both cases. Today's holding is not limited to subsidized low-income housing complexes rented primarily to the elderly and disabled. 32 [N]o asset consisting of a single-family or multi-family dwelling unit owned by an entity the property of which would otherwise be exempt pursuant to subparagraph a of this paragraph shall be exempt from ad valorem taxation if any such dwelling unit was improved with or acquired with any portion of proceeds from the sale of obligations issued by any entity organized pursuant to Section 176 of Title 60 of the Oklahoma Statutes if the interest income derived from such obligations is exempt from federal income tax . . . . 68 O.S. 2004 § 2887(8)(a)(2)(b).

d66f7063-90bb-4118-8357-fe5b0ecb0032

Wells Fargo Bank, N.A. v. Heath

oklahoma

Oklahoma Supreme Court

WELLS FARGO BANK, N.A. v. HEATH2012 OK 54Case Number: 108383Decided: 06/12/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. WELLS FARGO BANK, N.A., AS TRUSTEE FOR OPTION ONE MORTGAGE LOAN TRUST 2005-4 ASSET-BACKED CERTIFICATES, SERIES 2005-4; Plaintiff/Appellee,v.ROBERT HEATH AND SHELLY HEATH; Defendants/Appellants ON APPEAL FROM THE DISTRICT COURT OF TULSA COUNTYHONORABLE DAMAN CANTRELLDISTRICT JUDGE ¶0 Appeal of an order denying Robert and Shelly Heath's petition and motion to vacate in favor of Wells Fargo Bank N.A., as Trustee for Option One Mortgage Loan Trust 2005-4 Asset Backed Certificates, Series 2005-4, heard on April 13, 2010, and memorialized on February 21, 2012. The Heaths appeal this order arguing Wells Fargo Bank, N.A., as Trustee for Option One Mortgage Loan Trust 2005-4 Asset Backed Certificates, Series 2005-4, failed to demonstrate standing. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS A. Grant Schwabe, Kivell, Rayment & Francis, P.C., Tulsa, Oklahoma, for Plaintiff/ Appellee.Phillip A. Taylor, Taylor & Associates, Broken Arrow, Oklahoma, for Defendants/Appellants COMBS, J. ¶1 On August 11, 2005, Robert Heath, executed a promissory note in favor of Option One Mortgage Corporation (Option One) which was secured by a mortgage executed the same day by Robert Heath and his wife Shelly Heath (Appellants). Default on the note is alleged to have occurred in September 2008. The Plaintiff/Appellee, Wells Fargo Bank, N.A., as Trustee for Option One Mortgage Loan Trust 2005-4 Asset Backed Certificates, Series 2005-4 (Appellee), filed its petition to foreclose on December 22, 2008. Attached to the Petition is a copy of the note, mortgage and assignment of the mortgage. The note contains neither an indorsement nor an attached allonge. The assignment of mortgage was made by Option One Mortgage Corporation to Appellee and is dated February 28, 2008. It does not purport to transfer the note. The Appellants, then represented by Ron Brown, filed an answer on February 3, 2009, generally denying all allegations. ¶2 Appellee filed a motion for summary judgment and Appellant did not respond. A final journal entry of judgment was filed on June 16, 2009, granting Appellee a judgment in rem and in personam against Appellants. The property was sold at sheriff's sale on July 28, 2009, and a motion to confirm the sale was filed the same day.1 The hearing for the motion to confirm was set for August 18, 2009. A day before the hearing, Appellants filed an Advice of Bankruptcy. Appellants were later discharged from bankruptcy and appellee filed a "Notice of Alias Hearing Motion to Confirm Sale" on January 26, 2010. The hearing was set for February 16, 2010. ¶3 On February 12, 2010, Appellant's new counsel, Phillip A. Taylor, filed a petition and motion to vacate the June 12, 2009, journal entry of judgment and a motion to suspend all execution proceedings. Appellants also requested alternatively for leave to file an application to assume original jurisdiction and petition for writ of prohibition. Appellee answered and argued it was the holder of the note and mortgage pursuant to an assignment filed of record with the county clerk. Appellee cites Everhome Mortgage Company v. Dick Robey et al. 2006 OK CIV APP 64, 136 P.3d 1066, for the purpose of showing constructive possession of a note can be established by an assignment of the note. Appellee further argued Appellants' personal liability had been discharged in the bankruptcy and Appellants had surrendered the property to the lien holder and thus have no interest in the property. ¶4 A hearing was held on April 13, 2010, wherein the court denied the petition and motion to vacate. According to the transcript of the record, Appellee's counsel presented the original note at the hearing with an undated allonge attached. The allonge was made by "Option One Mortgage Corporation, A California Corporation" and signed by Amber Satterfield, Assistant Secretary. It was a blank indorsement made "[p]ay to the order of."2 At the hearing, Appellee's counsel states an allonge can be executed at any time, even at the hearing. ¶5 The trial court also issued an order on May 5, 2010, denying Appellants' motion for order suspending execution proceedings but granted Appellants request for leave of court to file a writ of prohibition with the this Court. On June 3, 2010, Appellants filed an "Application to Assume Original Jurisdiction and for Writ or (sic) Prohibition." This was later recast as an appeal by order of this Court. ¶6 Appellants filed a petition in error on November 24, 2010, appealing the "April 13, 2010, order denying Motion to Vacate Summary Judgment entered in Appellee's favor on June 15, 2009."3 This Court then ordered Appellants to file a second amended petition in error because Appellants wrongly designated the appeal as an accelerated appeal under Rule 1.36. In their second amended petition in error, the Appellants identified the order being appealed as the December 20, 2010, order reflecting the trial court's order of May 5, 2010.4 On January 24, 2012, this Court again asked Appellants to file a supplemental petition in error to include a proper memorialization of the court minute posted on April 13, 2010, concerning the hearing on Appellants' petition and motion to vacate. On February 22, 2012, Appellants filed a supplemental petition in error wherein they state the orders they are appealing are the December 21, 2010, order which reflects the trial court's May 5, 2010, order, and the February 21, 2012, order finally memorializing the trial court's order to deny Appellants' motion to vacate final journal entry of judgment.5 STANDARD OF REVIEW ¶7 The standard of review for a trial court's ruling either vacating or refusing to vacate a judgment is abuse of discretion. Ferguson Enterprises, Inc. v. Webb Enterprises, Inc., 2000 OK 78, ¶ 5, 13 P.3d 480, 482; Hassell v. Texaco, Inc., 1962 OK 136, 372 P.2d 233. A clear abuse-of-discretion standard includes appellate review of both fact and law issues. Christian v. Gray, 2003 OK 10, ¶ 43, 65 P.3d 591, 608. An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law, or where there is no rational basis in evidence for the ruling. Fent v. Oklahoma Natural Gas Co., 2001 OK 35, ¶12; 27 P.3d 477, 481. The dispositive issue presented to this Court is standing. This Court has previously held: Standing, as a jurisdictional question, may be correctly raised at any level of the judicial process or by the Court on its own motion. This Court has consistently held that standing to raise issues in a proceeding must be predicated on interest that is "direct, immediate and substantial." Standing determines whether the person is the proper party to request adjudication of a certain issue and does not decide the issue itself. The key element is whether the party whose standing is challenged has sufficient interest or stake in the outcome. Matter of the Estate of Doan, 1986 OK 15, ¶7, 727 P.2d 574, 576. In Hendrick v. Walters, 1993 OK 162, ¶ 4, 865 P.2d 1232, 1234, this Court also held: Respondent challenges Petitioner's standing to bring the tendered issue. Standing refers to a person's legal right to seek relief in a judicial forum. It may be raised as an issue at any stage of the judicial process by any party or by the court sua sponte. (emphasis original) Furthermore, in Fent v. Contingency Review Board, 2007 OK 27, footnote 19, 163 P.3d 512, 519, this Court stated "[s]tanding may be raised at any stage of the judicial process or by the court on its own motion." Additionally in Fent, this Court found: Standing refers to a person's legal right to seek relief in a judicial forum. The three threshold criteria of standing are (1) a legally protected interest which must have been injured in fact- i.e., suffered an injury which is actual, concrete and not conjectural in nature, (2) a causal nexus between the injury and the complained-of conduct, and (3) a likelihood, as opposed to mere speculation, that the injury is capable of being redressed by a favorable court decision. The doctrine of standing ensures a party has a personal stake in the outcome of a case and the parties are truly adverse. Fent v. Contingency Review Board, 2007 OK 27, ¶7, 163 P.3d 512, 519-520. In essence, a plaintiff who has not suffered an injury attributable to the defendant lacks standing to bring a suit. And, thus, "standing [must] be determined as of the commencement of suit; . . ." Lujan v. Defenders of Wildlife, 504 U.S. 555, 570, n.5, 112 S. Ct. 2130, 2142, 119 L. Ed. 351 (1992). ANALYSIS ¶8 The Appellants challenged Appellee's standing in its petition and motion to vacate. Because standing may be challenged at any stage of the judicial process it was proper to bring up the issue in Appellants' petition and motion to vacate. Appellee cites Kordis v. Kordis, 2001 OK 99, ¶6, 37 P.3d 866, 869, for the standard of review on a motion to vacate. Kordis held "[t]he reviewing court does not look to the original judgment but rather the correctness of the trial court's response to the motion to vacate" and "[a]s a result, we apply the abuse of discretion standard." Kordis was not a case challenging standing. The issue of standing was presented in the motion to vacate and at the hearing on such motion. Standing may be brought up at any time in the judicial procedure and an abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law. From the record, there was no proof Appellee was the holder of the note at the time of commencement of the suit. Standing was not established by the materials attached to Appellee's petition or motion for summary judgment because there was no attached indorsed note nor was there an assignment of the note. Therefore, we find the trial court based its decision on an erroneous conclusion of law. There existed a substantial issue of material fact that needed to be addressed at trial. Even though the Appellants did not respond to the motion for summary judgment, the trial court should have denied the motion sua sponte.6 ¶9 To commence a foreclosure action in Oklahoma, a plaintiff must demonstrate it has a right to enforce the note and, absent a showing of ownership, the plaintiff lacks standing. Gill v. First Nat. Bank & Trust Co. of Oklahoma City, 1945 OK 181, 159 P.2d 717.7 Article III of the Uniform Commercial Code (hereinafter "U.C.C.") governs negotiable instruments and is codified in the Oklahoma Statutes.8 Because the note is a negotiable instrument, it is subject to the requirements of the UCC.9 Thus, a foreclosing entity has the burden of proving it is a "person entitled to enforce an instrument" by showing it was "(i) the holder of the instrument, (ii) a nonholder in possession of the instrument who has the rights of a holder, or (iii) a person not in possession of the instrument who is entitled to enforce the instrument pursuant to Section 12A-3-309 or subsection (d) of Section 12A-3-418 of this title." 12A O.S. 2001 §3-301. The Appellee has the burden of showing it is entitled to enforce the instrument. See, Reserve Loan Life Ins. Co. v. Simmons, 1928 OK 669, ¶ 9, 282 P. 279, 281. Unless the Appellee was able to enforce the note at the time the suit was commenced, it cannot maintain its foreclosure action against the Appellants. ¶10 To demonstrate you are the "holder" of the note under the UCC you must prove you are in possession of the note and the note is either "payable to bearer" (blank indorsement) or to an identified person that is the person in possession (special indorsement).10 Therefore, both possession of the note and an indorsement on the note or attached allonge11 are required in order for one to be a "holder" of the note. The record in this case reflects the note attached to the petition had not been indorsed. Therefore, there is no evidence, at the time the petition was filed that the Appellee was the holder of the note. ¶11 Appellee also argues it was a holder because of the assignment of mortgage. Appellee cites to Everhome Mortg. Co. v. Robey, 2006 OK CIV APP 64, 136 P.3d 1066. In Everhome the mortgage company (Everhome) was assigned the note and mortgage through a series of mesne conveyances. Everhome stated it could not determine the custodian in actual physical possession of the original note and the defendants challenged standing on this basis. The trial court granted summary judgment in favor of Everhome and the Oklahoma Court of Civil Appeals (COCA) affirmed. COCA found the assignment of the note and mortgage to Everhome was undisputed. It held, because of the filing of the assignment, Everhome had constructive possession of the note and was entitled to enforce it. Appellee argues, in the present case, it has constructive possession of the note and is entitled to enforce. However, the facts in the present case are different. The assignment of mortgage to Appellee does not also purport to assign the note. It only assigns the mortgage. An assignment of the mortgage is not an assignment of the note. In Oklahoma, "[p]roof of ownership of the note carried with it ownership of the mortgage security." Engle v. Federal Nat. Mortg. Ass'n, 1956 OK 176, ¶7, 300 P.2d 997, 999. The opposite is not true. Therefore, Everhome is not persuasive to the disposition of the present case. ¶12 The first presentation of an indorsed note was at the hearing on the petition and motion to vacate. Appellee's counsel also indicated an indorsement could be made at any time. Standing must occur prior to the petition being filed. A promissory note is a negotiable instrument and a negotiable instrument is a contract.12 "Contracts are binding only upon those who are parties thereto, and are enforceable only by the parties to a contract or those in privity with it…"13 "Privity of contract is an essential element of a cause of action on a contract, or an action based on a contractual theory. As a general rule only the parties and privies to a contract may enforce it."14 "[O]ne of the reasons for the rule that privity of contract is necessary to an action founded on a breach of contract is that otherwise a man's responsibility for not carrying out his agreement with another would have no limit; there would be no bounds to actions if the ill effect of the failure of a man to perform his agreement could be followed down the chain of results to the final effect."15 The rights and obligations of the parties are established within the four corners of the contract, which is the promissory note. Plaintiff's authority to enforce the obligations and responsibilities established in the original promissory note need be determined prior to the request for relief by reason of the alleged breach of the obligation. Absent standing, a party's claim is not justiciable, and the courts will not inquire into the merits of the claim. West v. Justice, 2008 OK CIV APP 49,¶ 9, 185 P.3d. 412, 414. Standing may be raised at any stage of the proceeding, and when raised, the party invoking the court's jurisdiction has the burden of establishing his or her standing. Id at ¶ 10 Because there was a substantial issue of material fact concerning standing that should have been addressed, the court, sua sponte, should not have granted summary judgment and should have vacated its judgment upon the standing issue for further determination.16 ¶13 Appellee also asserts the trial court could have denied Appellants' petition and motion to vacate because a summons was neither issued nor served on Appellee. Appellants alleged the grounds for their petition and motion to vacate were irregularity and fraud.17 Only the fraud allegation (paragraph 4) requires a petition and summons if the motion to vacate occurs more than thirty (30) days from the date of the order to be vacated.18 Therefore, at least the issue of "irregularity in obtaining a judgment or order" would not have required a petition and summons. Further, Rule 19 of the District Court Rules provides: a. In any proceeding to vacate, modify or reopen a final judgment that is commenced more than thirty days after its rendition, (1) proceeding by motion instead of by petition or by petition instead of by motion, or (2) failure to verify the petition, or (3) incorrect service of process or the required notice is waived if the opposing party appears in the proceeding but does not immediately object thereto; and such defects are waived by any party in default who had actual notice of the proceeding. (emphasis added) ¶14 Appellee did not object to proper service in its answer to the petition and motion to vacate. Further, Appellee appeared at the proceeding. Therefore, we find the issue, if any, of proper service was waived and would not have been grounds for a denial. ¶15 Appellants further assert Appellee could not be the holder of the note and mortgage because another party was listed as the creditor in Appellants' bankruptcy filings, and Appellee did not make a claim in the bankruptcy.19 Appellants claim Appellee did not file a claim because it knew at the time of the bankruptcy it was not the holder of the note and mortgage. Appellee rebuts this argument by saying Appellants are the ones who filled out the schedules and no other creditor filed a claim on the property. Appellee states it only acknowledged Appellants' bankruptcy filings to show Appellee intended to surrender the property and it does not assert Appellants' filings are correct. Although, we find no merit in Appellants argument, because of its own bankruptcy filings, it demonstrates Appellee is not the holder of the note, Appellee still has not proven it was the holder of the note at the commencement of the case. ¶16 As previously stated, the dispositive issue is whether or not Appellee has standing. Appellants' argument is based on the failure of Appellee to establish it was a person entitled to enforce the note at the commencement of the action. Appellee must demonstrate it became a "person entitled to enforce" prior to the filing of the foreclosure proceeding. We find there is no evidence in the record establishing Appellee had standing when commencing this foreclosure action. The trial court's granting of a summary judgment in favor of Appellee was based on an erroneous conclusion of law that the Appellee had standing, at the time of the commencement of the action, when the admissible evidence demonstrated standing may have been obtained after commencement of the proceeding. Therefore, we find the trial court abused its discretion by denying Appellants' motion to vacate. The order denying petition and motion to vacate should be reversed and remanded back for further proceedings to determine whether Appellee is a person entitled to enforce the note consistent with this opinion. CONCLUSION ¶17 It is a fundamental precept of the law to expect a foreclosing party to actually be in possession of its claimed interest in the note, and to have the proper supporting documentation in hand when filing suit, showing the history of the note, so the defendant is duly apprised of the rights of the plaintiff. A defendant needs to be assured it is being sued by the person who can rightfully enforce the note. Otherwise, it potentially opens the defendant to multiple actions on a single note. Filing a foreclosure suit without being a person entitled to enforce the note is putting the cart before the horse. If a plaintiff claims it is the holder of the note and obtains an indorsement after the suit is filed, then it should initiate the procedure for curing this defect.20 The law does not have to comply with the business practices of the plaintiff, the business practices of the plaintiff must comply with the law whether or not it is inconvenient. In the present case, it was evident the plaintiff had no difficulty presenting an indorsed note later in the proceedings. If there is no indorsement on a note, and a plaintiff is claiming it is a nonholder in possession who has the rights of a holder, then the plaintiff should have documentation establishing that the purpose of the transfer of the note was to give the plaintiff the right to enforce the note. An assignment of mortgage without an assignment of the note is not proof of the purpose for the alleged transfer of the note. A party must demonstrate it is a holder of the instrument or a nonholder in possession of the instrument who has the rights of a holder, or a person not in possession of the instrument who is entitled to enforce the instrument pursuant to 12A O.S. 2001, § 3-309 or 12A O.S. 2001, § 3-418. Likewise, for the homeowners, absent adjudication on the underlying indebtedness, today's decision to reverse the denial of the petition and motion to vacate cannot cancel their obligation arising from an authenticated note, or insulate them from foreclosure proceedings based on proven delinquency. This Court's decision in no way releases or exonerates the debt owed by the defendants on this home. See, U.S. Bank National Association v. Kimball, 27 A.3d 1087, 75 UCC Rep.Serv.2d 100, 2011 VT 81 (VT 2011); and Indymac Bank, F.S.B. v. Yano-Horoski, 78 A.D.3d 895, 912 N.Y.S.2d 239 (2010). REVERSED AND REMANDED WITH INSTRUCTIONS ¶18 CONCUR: TAYLOR, C.J., WATT, EDMONDSON, REIF, COMBS, JJ. ¶19 DISSENT: WINCHESTER (JOINS GURICH, J.), GURICH (BY SEPARATE WRITING), JJ. ¶20 NOT PARTICIPATING: KAUGER, J. ¶21 RECUSED: COLBERT, V.C.J. FOOTNOTES 1 It appears from the docket that the property sold to REO Dispositions. On May 24, 2010, the trial court issued an Order granting a refund to REO Dispositions. 2 Appellee states in its answer brief that the original note with an indorsement was not admitted into evidence at the motion to vacate hearing nor originally in the record. However, the transcript reflects it was offered as evidence to the trial court at the April 13, 2010, motion to vacate hearing. Appellee asked for leave of this Court to amend the record and include the original note. We granted that request on February 28, 2012. 3 The Final Journal Entry of Judgment was actually made on June 12, 2009, and filed June 16, 2009. 4 The May 5, 2010, Order denied Appellants' motion for order suspending execution proceedings and granted Appellants leave to file writ of prohibition. It did not concern the petition and motion to vacate. 5 Appellee filed a Motion to Strike Supplemental Ex Parte Order challenging the memorialized April 13, 2010, order filed February 21, 2012. The motion alleges Appellee and Appellants agreed on the memorialized order but Appellants' counsel did not notify Appellee's counsel when he was going to get the order signed and the order signed was not the same as the agreed order. The order was not signed by the trial court judge, Daman Cantrell, but instead was signed by Judge Dana Kuehn. The order included hand written language according to counsel for appellant, allegedly made by J. Kuehn. The language states "[t]he Court finds that Defendant did not respond to summary judgment and under Spirgis v. Circle K Stores, 743 P.2d 682 (Okla. App. 1987) the request is granted." In Appellants' response, their counsel explains J. Kuehn "made a minor alteration for whatever reason, waived the signature of Mr. Schwabe, and signed the Order." We deny appellee's motion to strike; however, because of the circumstances we will ignore the hand written language in the memorialized order. At the motion to vacate hearing and according to the transcript of that hearing, the Spirgis case was never mentioned. It is curious why J. Kuehn who was not the judge at the hearing would feel compelled for whatever reason to make a handwritten reference to Spirgis on an otherwise agreed-to order. However, this is not to say the Spirgis case is irrelevant to the present one. 6 See Spirgis v. Circle K Stores, Inc., 1987 OK CIV APP 45, 743 P.2d 68, Approved for Publication by this Court. 7 This opinion occurred prior to the enactment of the UCC. It is, however, possible for the owner of the note not to be the person entitled to enforce the note if the owner is not in possession of the note. (See the REPORT OF THE PERMANENT EDITORIAL BOARD FOR THE UNIFORM COMMERCIAL CODE, APPLICATION OF THE UNIFORM COMMERCIAL CODE TO SELECTED ISSUES RELATING TO MORTGAGE NOTES (NOVEMBER 14, 2011)). 8 12A O.S. §§ 1-101 - 11-107. 9 12A O.S. 2001, § 3-104. 10 12A O.S. 2001, §§ 1-201(b)(21), 3-204 and 3-205. 11 According to Black's Law Dictionary (9th ed. 2009) an allonge is "[a] slip of paper sometimes attached to a negotiable instrument for the purpose of receiving further indorsements when the original paper is filled with indorsements." See, 12A O.S. 2001, § 3-204(a). It should be noted that under 12A O.S. 2001, § 3-204(a) and its comments in paragraph 2, it is no longer necessary that an instrument be so covered with previous indorsements that additional space is required before an allonge may be used. An allonge, however, must still be affixed to the instrument. 12 12A O.S. 2001, § 3-104; See also: Fred H. Miller & Alvin C. Harrell, The Law of Modern Payment Systems And Notes § 1.03 (practitioner's ed. 2002) ("A negotiable instrument is a contract. The contractual nature of a negotiable instrument is evident in the case of a promissory note, where there is an express promise to pay. But it is also true of drafts, where the promise to pay is implied . . . Article 3 thus constitutes a special body of legal rules governing the particular kinds of contracts called negotiable instruments."). 13 Drummond v. Johnson, 1982 OK 37, ¶25, 643 P.2d 634, 639. 14 17B C.J.S. Contracts § 836 15 Okmulgee Coal Co. v. Hinton et al., 1923 OK 188, ¶9, 218 P. 319, 320. 16 See Spirgis v. Circle K Stores, 1987 OK CIV APP 45; 743 P.2d 682, Approved for Publication by this Court. Also see, BAC Home Loans Servicing L.P. v. White, 2011OK CIV APP 35; 256 P.3d 1014, Approved for Publication by this Court, March 16, 2011. 17 12 O.S. 2001, § 1031: "The district court shall have power to vacate or modify its own judgments or orders within the times prescribed hereafter: …3. For mistake, neglect, or omission of the clerk or irregularity in obtaining a judgment or order; 4. For fraud, practiced by the successful party, in obtaining a judgment or order; …" 18 12 O.S. 2001, §1033: "If more than thirty (30) days after a judgment, decree, or appealable order has been filed, proceedings to vacate or modify the judgment, decree, or appealable order, on the grounds mentioned in paragraphs 2, 4, 5, 6, 7, 8 and 9 of section 1031 of this title, shall be by petition, verified by affidavit, setting forth the judgment, decree, or appealable order, the grounds to vacate or modify it, and the defense to the action, if the party applying was defendant. On this petition, a summons shall issue and be served as in the commencement of a civil action." 19 American Home Mortgage Svci, not Appellee, is listed as the creditor in Appellants' bankruptcy Schedule D and in its Statement of Intention to surrender the property. These documents were attached to Appellee's answer to Appellants' petition and motion to vacate. 20 See our recent decision in HSBC Bank USA v. Lyon, 2012 OK 10, ¶7; "The trial court's actions have cured any deficiencies. The dismissal of the original action and the first Motion for Summary Judgment filed therein, and requiring the refiling of the second amended petition with the attached note demonstrating a proper indorsement, effectively cured any lack of standing in the initial filing. Thus, by the filing of the second amended petition with a properly indorsed note and a properly assigned mortgage attached thereto, HSBC has shown it was a person entitled to enforce the instrument as the holder of the note. 12A O.S. 2001 §3-301." GURICH, J., with whom WINCHESTER, J. joins dissenting: ¶1 The majority reverses solely on the issue of standing, finding that "standing was not established by the materials attached to Appellee's petition or motion for summary judgment because there was no attached indorsed note nor was there an assignment of the note." Majority Op. ¶ 8. ¶2 The majority continues to fashion new requirements in mortgage foreclosure cases, this time, by requiring Plaintiff to have separate documentation at the time of filing that establishes that the transfer of the note included the Plaintiff's right to enforce the note. The majority finds that an assignment of the mortgage without an assignment of the note is not proof of the purpose for the alleged transfer of the note. I disagree. ¶3 The Restatement Third of Property on Mortgages states: "When ownership of a mortgage is assigned to another . . . the obligation secured by the mortgage is likewise transferred unless the parties agree that the obligation be retained by the transferor. In effect, the obligation will follow the mortgage even if not expressly mentioned in any document of transfer." Restatement (Third) of Property: Mortgages § 5.4 cmt. c. Additionally, under the Uniform Commercial Code ("U.C.C.") when a transferee seeks to enforce an unindorsed instrument, it must account for "possession of the unindorsed instrument by proving the transaction through which the transferee acquired it. Proof of a transfer to the transferee by a holder is proof that the transferee has acquired the rights of a holder." U.C.C. § 3-203 cmt. 2 (emphasis added). ¶4 In this case, the Plaintiff attached to its Petition a copy of the note, the mortgage, and an assignment of the mortgage.1 Plaintiff alleged in its Petition that it became the present holder of the note and mortgage "having received due assignment through mesne assignments of record, said assignment recorded in the office of the County Clerk . . . in Document #2008024539."2 The assignment of the mortgage was proof of the purpose of the transfer of the note. There is no indication in the assignment of the mortgage that the parties intended anything other than to transfer both the mortgage and the note. As such, the note followed the mortgage even if the assignment of the note was not expressly mentioned in the assignment of the mortgage. The assignment of the mortgage was proof of the transaction through which the Plaintiff acquired the rights of the holder, entitling Plaintiff to enforce the note. ¶5 The majority criticizes the trial court for sustaining the Plaintiff's motion for summary judgment even though the motion was supported by evidentiary materials and the Defendants failed to respond.3 Plaintiff's status as holder of the instrument, which likewise entitled it to enforce the note, was further bolstered by the presentation of an indorsed-in-blank allonge at the hearing on the Defendants' motion to vacate. The Plaintiff now has to go back to the trial court to establish the same uncontroverted facts. ¶6 The majority, in today's case and in other recently decided foreclosure cases, created procedural requirements that are not applied in any other civil actions and are inconsistent with requirements found in established statutory and case law. Similarly, the majority reinterpreted the Oklahoma version of the U.C.C. to require more stringent requirements for enforcement of a negotiable instrument than were previously required. The Majority continues to use these new substantive and procedural requirements to vacate judgments entered by trial judges who applied the existing law to the facts presented and were correct in most, if not all, of the cases. Therefore, I respectfully dissent. FOOTNOTES 1 Unless a party challenges the authenticity of an original document, pursuant to 12 O.S. § 3003 and 12A O.S. §3-308(a), a copy is admissible. 2 Plaintiff's counsel, by signing the Amended Petition, averred that Plaintiff had evidentiary support for these factual contentions. See 12 O.S.2012 § 2011(B). 3 See Rule 13, Rules for District Courts of Oklahoma, 12 O.S. Ch. 2, App.

5b2c0421-bc3f-4086-9a81-f82d18e4babf

Samson Resources Co. v. Newfield Exploration Mid-Continent, Inc.

oklahoma

Oklahoma Supreme Court

SAMSON RESOURCES CO. v. NEWFIELD EXPLORATION MID-CONTINENT, INC.2012 OK 68Case Number: 108430Decided: 07/03/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. SAMSON RESOURCES COMPANY, Plaintiff-Appellant, v. NEWFIELD EXPLORATION MID-CONTINENT, INC., Defendant-Appellee. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION III, ON APPEAL FROM THE DISTRICT COURT OF ROGER MILLS COUNTY, STATE OF OKLAHOMA, HONORABLE CHARLES L. GOODWIN ¶0 Samson Resources Company filed a petition in the District Court of Roger Mills County alleging actual fraud, deceit, intentional and negligent misrepresentation, constructive fraud, and breach of duty as operator against Newfield Exploration Mid-Continent Inc. Samson also alleged that Newfield's actions amounted to extrinsic fraud on the Oklahoma Corporation Commission and sought to invalidate Pooling Order 550310. The trial court granted Newfield's motion to dismiss for lack of subject matter jurisdiction, finding the petition to be an impermissible collateral attack on a valid Commission order. The Court of Civil Appeals, Division III, affirmed. We find that Samson's actions for damages sounding in tort were beyond the Commission's jurisdiction, and the district court in this case was the proper tribunal for Samson to bring its claims. The trial court's order granting Newfield's Motion to Dismiss is reversed, and the case is remanded for further proceedings. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; MATTER REMANDED FOR FURTHER PROCEEDINGS Michael E. Smith, Sharon T. Thomas, Hall, Estill, Hardwick, Gable, Golden & Nelson P.C., Oklahoma City, OK, for Plaintiff-Appellant Gregory L. Mahaffey, Mahaffey & Gore, P.C., Oklahoma City, OK, for Defendant-Appellee GURICH, J. Facts & Procedural History ¶1 In August of 2009, Samson Resources Company owned oil and gas leases covering 87.78 mineral acres in Roger Mills County, Oklahoma, including the Schaefer Lease. The Schaefer Lease covered 70 net acres in the Southwest Quarter of Section 28 and had a three-year primary term that ended on November 22, 2007. If drilling operations were commenced by the end of the primary term, the lease would continue so long as such operations continued. If drilling operations were not commenced by the end of the primary term, the lease would expire. ¶2 On August 2, 2007, Newfield sent a letter to Samson, proposing to drill a well in Section 28. The estimated cost of the well was over $8.5 million dollars. On August 9, 2007, Newfield filed an application with the Commission, seeking to force pool the interests of Samson and other owners in Section 28.1 ¶3 On October 4, 2007, Samson sent a letter to Newfield offering to enter into an agreement regarding Newfield's proposal to drill a well in Section 28 and Newfield's force pooling application.2 Newfield did not accept Samson's proposal. Newfield's force pooling application was protested and set for hearing on December 12-14, 2007. Samson decided to take no action regarding the Schaefer Lease and allowed it to expire at the end of its term on November 22, 2007.3 ¶4 Before the Schaefer Lease expired, Newfield began dirt work in the Southwest Quarter of Section 28, perpetuating the Schaefer Lease. According to Samson, Newfield concealed the dirt work from Samson, obtained a drilling permit from the Commission on November 27, 2007, and spudded a well known as the Miss Carol 1H-28 on December 1, 2007. Because Samson was allegedly unaware of Newfield's actions and believed the Schaefer Lease had expired, it did not appear at the December 12-14, 2007 hearing on Newfield's force pooling action. ¶5 The Commission's pooling order issued on February 21, 2008, Order No. 550310, did not disclose that Newfield had already commenced drilling the Miss Carol Well in Section 28 or that it had taken any action that might have perpetuated the Schaefer Lease. The pooling order, drafted by Newfield, stated that Newfield was "proposing" to drill a well in Section 28 and required Newfield to commence drilling the well within 180 days. It also required owners to elect whether to participate and pay or whether to accept a cash bonus. Believing it owned only 17.78 mineral acres, Samson elected, by letter on February 26, 2008, to participate to the full extent of its interest. On March 10, 2008, Samson sent Newfield a check in the amount of $285,999.63, representing Samson's prepayment for its 17.78 acres. A Newfield landman treated Samson's payment as an election to participate to the extent of all its interest and did not compare the prepayment amount against the respective amounts of working interest acreage in the unit. ¶6 Newfield sent an e-mail dated April 14, 2008, to Samson that informed Samson that Newfield had commenced operations prior to the expiration of the Schaefer Lease. Newfield's e-mail stated that Samson had underpaid well costs and that an election to participate with 87.78 acres would require prepayment of $1,411,982.45. Samson responded by e-mail on the same date, informing Newfield its intent was only to elect its 17.78 acres. On April 28, 2008, Samson filed an Application to Determine Election Pursuant to Pooling Order 550310 with the Commission. Samson sought to have its election to participate in the Miss Carol well limited to 17.78 acres rather than 87.78 acres. ¶7 After an administrative hearing at the Commission, the Administrative Law Judge determined that Samson's timely election to participate only covered 17.78 acres of its interest and that Samson accepted the cash bonus as to its remaining 70 acres. The Oil and Gas Appellate Referee reversed the ALJ's determination, finding that the ALJ improperly relied on actions which occurred prior to the issuance of the pooling order. The Commission issued Order No. 567706, which adopted the Referee's report, reversed the ALJ, and declared that Samson had elected to participate to the full extent of its 87.78 acre interest in the unit. The Commission found Samson made a "unilateral mistake" when it elected to participate to the full extent of its interest. Samson appealed the Commission's order to the Court of Civil Appeals, which affirmed. This Court denied certiorari review on June 28, 2010 (Samson I). ¶8 Before COCA issued its opinion in Samson I affirming the Commission, Samson filed an action in the District Court of Roger Mills County, alleging actual fraud, deceit, intentional and negligent misrepresentation, constructive fraud, and breach of duty as operator. Samson also alleged Newfield's actions amounted to extrinsic fraud on the Commission, rendering Pooling Order No. 550310 invalid as to Samson's working interest attributable to the 70-acre Schaefer Lease. ¶9 Newfield filed a 12 O.S. § 2012(B)(1) motion to dismiss for lack of subject matter jurisdiction, arguing that Samson's petition was an impermissible collateral attack on a valid Commission order. After reviewing briefs and exhibits and holding a hearing on the motion, the trial court dismissed Samson's petition, finding that Samson's petition and causes of action were an impermissible collateral attack upon a final order of the Commission. Samson appealed, and COCA affirmed, treating the dismissal as a summary judgment because the parties attached evidentiary materials to their pleadings. Samson petitioned this Court for certiorari review, and we granted review on June 20, 2011. Standard of Review ¶10 The subject of this appeal is Newfield's 12 O.S. § 2012 (B)(1)4 motion to dismiss, which was granted by the trial court. The purpose of a motion to dismiss is to test the law that governs the claim in litigation rather than to examine the underlying facts of that claim. Rogers v. Quiktrip Corp., 2010 OK 3, ¶ 4, 230 P.3d 853, 856. As such, whether a claim should have been dismissed for lack of subject matter jurisdiction is a question of law this Court reviews de novo. Id. Analysis ¶11 Samson first argues that its claims should not have been dismissed by the trial court because only the trial court had jurisdiction to hear the claims asserted.5 We find this argument persuasive. The Commission oversees the conservation of oil and gas, and its jurisdiction is limited to the resolution of public rights. Tucker v. Special Energy Corp., 2008 OK 57, ¶ 9, 187 P.3d 730, 733. Public rights are involved when "a unitization order, pooling order, or order setting the allowables on the unit's well" affects "the correlative rights of all mineral rights owners in [a] common source of supply [in a] unit." Id. (internal quotations omitted). The Commission does not have jurisdiction over private rights and does not have jurisdiction to hear and render judgments in an action for damages sounding in tort. Rogers, 2010 OK 3, ¶ 6, 230 P.3d at 857. Questions in an action concerning the relationship of private parties, their duties, rights and obligations, and the existence of liability for the breach of such duties are matters particularly within the jurisdiction of the district courts. Id. ¶ 7, 230 P.3d at 858. ¶12 In its petition, Samson claimed that Newfield owed it a duty and that Newfield breached that duty by failing to disclose certain facts to Samson. Samson alleged Newfield's actions amounted to actual fraud, deceit, and intentional misrepresentation, entitling Samson to actual damages, including the amounts Samson paid or is required to pay Newfield regarding the Schaefer Lease. Alternatively, Samson argued these actions amounted to constructive fraud and negligent misrepresentation, entitling it to actual, consequential, incidental, and special damages. Finally, Samson claimed in its petition that as the operator of the well Newfield owed Samson a duty of good faith and full and fair disclosure. Samson claimed Newfield breached this duty, entitling Samson to actual and punitive damages. In this case, Samson's claims sound in tort and are of a private nature. Therefore, the trial court erred by sustaining Newfield's motion. ¶13 Newfield also argues that Samson's claims are precluded because Samson had a full and fair opportunity to litigate the issues in the prior Commission action. The limited record on appeal does not support COCA's finding that Samson's claims are precluded because it is clear that the Order of the Commission was not based upon actions that occurred prior to the issuance of the pooling order.6 The trial court dismissed the action before either party had the opportunity below to fully address whether Samson's claims, or any factual or legal issues in support of those claims, were precluded by the Commission proceeding.7 ¶14 Finally, Samson argues that the pooling order including Samson's working interest attributable to the 70-acre Schaefer Lease is invalid due to Newfield's extrinsic fraud on the Commission. Neither the trial court nor COCA considered the issue of extrinsic fraud. However, the pooling order became a valid and final order of the Commission when this Court denied certiorari review in Samson I. The pooling order may not be attacked on remand on the basis of extrinsic fraud. See Okla. Const. art. IX, § 20; 52 O.S. § 111; Mullins v. Ward, 1985 OK 109, n.7, 712 P.2d 55, 59 n.7.8 Conclusion ¶15 Samson's claims for damages sounding in tort were beyond the Commission's jurisdiction, and the district court in this case was the proper tribunal for Samson to bring its claims. While we express no view on the merits of Samson's claims, the district court erred by dismissing the case for lack of subject matter jurisdiction. The trial court's order granting Newfield's Motion to Dismiss is reversed. COURT OF CIVIL APPEALS' OPINION VACATED; DISTRICT COURT'S JUDGMENT REVERSED; MATTER REMANDED FOR FURTHER PROCEEDINGS ¶16 COLBERT, V.C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, COMBS, GURICH, JJ. - CONCUR ¶17 REIF,J. - DISSENTS ¶18 TAYLOR, C.J. - NOT PARTICIPATING FOOTNOTES 1 Cause CD No. 200705396. 2 Samson proposed, among other terms, that it be provided a deferred election under which Newfield would provide notice of intent to spud a well at least thirty (30) days prior to spudding the well, and Samson would have fifteen (15) days to elect one of the options provided for in the pooling order. Samson also proposed that if it elected to participate in the drilling of the well that rather than being required to prepay its estimated share of the costs of drilling and completing the well it be allowed to pay actual well costs on a monthly basis, as they were incurred. 3 Without the Schaefer Lease, Samson only owned 17.78 mineral acres in Section 28. 4 12 O.S. § 2012 (B)(1) provides: B. How Presented. Every defense, in law or fact, to a claim for relief in any pleading, whether a claim, counterclaim, cross-claim, or third-party claim, shall be asserted in the responsive pleading thereto if one is required, except that the following defenses may at the option of the pleader be made by motion: 1. Lack of jurisdiction over the subject matter. 5 Samson also argues that COCA should not have converted the motion to dismiss into a motion for summary judgment. We agree. The procedure converting a motion to dismiss into a motion for summary judgment when matters outside the pleadings are presented applies only to motions to dismiss for failure to state a claim upon which relief can be granted. 12 O.S. § 2012(B) ("If, on a motion asserting the defense numbered 6 . . . matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and all parties shall be given reasonable opportunity to present all material made pertinent to the motion by the rules for summary judgment.") (emphasis added). 6 See Defendant's Motion to Dismiss, Ex. A at 2. The Order of the Commission states: "[T]he Corporation Commission is called upon to clarify Paragraph 3A of Pooling Order No. 550310. . . . The language of the Pooling Order is clear. It is apparent that under the Pooling Order a respondent not only had to elect to participate within the 15 days of the date of the Order, but within 20 days of the date of the Order, the respondent had to either pay such owner's proportionate part of the actual cost of the well covered thereby or secure or furnish security for such payment satisfactory to the Applicant. Thus, under the Rules of Construction, especially the Plain Meaning Rule, the focus is whether or not Samson's election and payment within 20 days of $285,999.63 as payment for cost for the Carol well satisfied the terms of the Pooling Order." Id. (emphasis added). 7 "A party asserting issue preclusion bears the burden of establishing that the factual issue to be precluded was actually determined in the prior proceeding." Wagner & Brown v. Ward Petroleum Corp., 876 F. Supp. 255, 259 (W.D. Okla. 1994) (citing Anderson v. Falcon Drilling, 1985 OK 13, ¶ 16, 695 P.2d 521, 526). "[W]here a defendant seeks to apply a prior judgment in one case to matters arising in another case on a different claim, 'the inquiry is whether the question of fact in issue in the latter case is the question of fact actually determined in the former action....'" Id. (quoting Runyan v. City of Henryetta, 1958 OK 3, ¶ 8, 321 P.2d 689, 693). 8 None of the cases cited by Samson stand for the proposition that a Commission order can be invalidated by a district court for extrinsic fraud. Dowell v. Boyer, 2000 OK CIV APP 29, 998 P.2d 206, involved a plaintiff creditor attacking a final divorce decree as a fraudulent transfer under the Uniform Fraudulent Transfer Act; Patel v. OMH Med. Ctr., Inc., 1999 OK 33, 987 P.2d 1185, involved a motion to vacate a district court judgment under 12 O.S. § 1031; Barrett v. Barrett, 1994 OK 92, 878 P.2d 1051, involved an attack on a tribal court divorce decree allegedly procured by fraud; and Muncrief v. Mobil Oil Co., 421 F.2d 801 (10th Cir. 1970), involved an attack on a probate proceeding based on an allegation of extrinsic fraud. Additionally, allegations of intrinsic fraud during a Commission proceeding must be heard before the Commission. Leck v. Continental Oil Co., 1989 OK 173, ¶ 22, 800 P.2d 224, 230. The district court does not have subject matter jurisdiction to hear allegations of intrinsic fraud committed during Commission proceedings. Id.

10e8a706-b33a-4385-95cf-e5462105175e

U.S. Bank, NA v. Alexander

oklahoma

Oklahoma Supreme Court

U.S. BANK, N.A. v. ALEXANDER2012 OK 43Case Number: 109648Decided: 05/01/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. U.S. BANK, N.A., as Trustee, for Credit Suisse First Boston HEAT 2005-4, Plaintiff/Appellee,v.JOHN W. ALEXANDER, III, and LISA ALEXANDER, Defendants/Appellants,ANDCITIFINANCIAL SERVICES, INC., Defendant. ON APPEAL FROM THE DISTRICT COURT OF CLEVELAND COUNTYHONORABLE TOM A. LUCASDISTRICT JUDGE ¶0 This matter comes before this Court as an accelerated appeal from an order granting summary judgment in favor of U.S. Bank National Association, as Trustee, for Credit Suisse First Boston HEAT 2005-4, against John W. Alexander, III, and Lisa Alexander. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS Sally E. Garrison, BAER, TIMBERLAKE, COULSON AND CATES, P.C., Oklahoma City, Oklahoma; Mark Edward Hardin, Tulsa, Oklahoma; Kari Y. Hawkins, Oklahoma City, Oklahoma, for Plaintiff/Appellee.Michael R. Warkentin, MICHAEL R. WARKENTIN, P.C., Norman, Oklahoma, for Defendants/Appellants. COMBS, J. ¶1 On May 10, 2005, John W. Alexander, III (Alexander), executed a note to MILA, Inc., DBA Mortgage Investment Lending Associates, Inc. (MILA), and a mortgage to Mortgage Electronic Registration Systems, Inc. (MERS), as nominee for MILA and its successors and assigns. The mortgage also contains language, identifying MERS as the mortgagee under this security instrument. ¶2 Wells Fargo Bank, N.A. (Wells Fargo), filed a foreclosure petition on July 23 2009, alleging appellant defaulted on the note for installments beginning April 1, 2009.1 The petition further states Wells Fargo was the present holder of the note and mortgage, and Wells Fargo took the note and mortgage for good and valuable consideration from the original lender. A copy of the note and part of the mortgage was attached to the original petition. The note attached to the original petition contained no indorsements. ¶3 On October 6, 2009, an Order Granting Motion for Substitution of Plaintiff and Modification of Caption was filed in response to a Motion filed that same date. Appellee, U.S. Bank National Association, as Trustee, for Credit Suisse First Boston HEAT 2005-4 (Appellee) was substituted in place of Wells Fargo. The motion stated Wells Fargo had subsequently assigned all of its rights in the mortgage to Appellee. Appellee also filed, on October 6, 2009, its First Amended Petition. This amended petition re-alleged all of the allegations of Wells Fargo's petition and identified additional defendants as parties who may have an interest in the property. Appellee attached to the amended petition, a copy of the same unindorsed note and mortgage originally executed by the Appellant John W. Alexander, III, in 2005. ¶4 Appellants (John W. Alexander, III, and Lisa Alexander) never answered the petition and a judgment was entered against Appellants on April 19, 2010. One day later, on April 20, 2010, Appellants' counsel made an entry of appearance and the judgment was vacated by order of May 19, 2010. ¶5 On June 8, 2010, Appellee filed a motion for summary judgment. Appellee claims, in this motion for summary judgment, it is the holder of the note and mortgage, and that Appellants have been in constant default since the July 1, 2009, installment payment was due. Appellee further alleges that Appellants have made no tender sufficient to reinstate the loan, and there has been no extension or renewal of the note. Appellee attached a copy of the same unindorsed note and parts of the mortgage included in its First Amended Petition. It also attached an affidavit and assignment of real estate mortgage. The affidavit was executed by a Vice President Loan Documentation of Appellee and generally affirms the allegations in the motion. The assignment of real estate mortgage reflects an execution date of August 13, 2009, but made effective March 1, 2005.2 This assignment was from MERS (as nominee for the lender) to Appellee of the real estate mortgage "together with the note, debts and claims thereby secured." (emphasis added) ¶6 Appellants filed an objection to Appellee's motion for summary judgment and later filed a supplement to the objection. Appellants challenged certain comments in Wells Fargo's motion to substitute which stated Wells Fargo subsequently assigned its rights under the mortgage to Appellee after the filing of the original petition on July 23, 2009. The assignment of real estate mortgage executed August 13, 2009, is from MERS to Appellee. This document, it is asserted by Appellee, provides evidence of the attempt to assign the note. The assignment of real estate mortgage from MERS to Appellee, was made retroactive to March 1, 2005, seventy (70) days prior to the note and mortgage being executed. Appellants assert the retroactive assignment may have been designed to cover possible violations of prohibited transactions for retirement plans or to demonstrate the transfer occurred prior to MILA filing bankruptcy on July 7, 2007. Appellants demanded, in their response to the motion for summary judgment, proof that MILA had authority to execute an assignment of the mortgage and indorsement of the note. ¶7 Appellants assert the note provided by Appellee does not have an indorsement and they claim such indorsement is necessary under the Uniform Commercial Code, 12A O.S. 2001, Sections 3-103(a), 3-203 and 3-204. Appellants fear without an indorsement they are vulnerable to future liability on the original note by another party.3 ¶8 A summary order was filed August 18, 2010, denying Appellee's motion for summary judgment because there were factual issues to be resolved. ¶9 Appellee filed a second motion for summary judgment on April 15, 2011. Appellee attached to the second motion for summary judgment, for the first time, a copy of the note with a blank allonge purportedly executed by an assistant funding manager of MILA. This allonge reflects "payable to the order of" "without recourse." Appellee asserted appellant did not contest the genuineness, authenticity and execution of the note and mortgage, and further, Appellants admitted at deposition they were behind on their payments.4 Therefore, Appellee asserted a prima facie case for foreclosure, specifically a valid mortgage exists and there had been a default. ¶10 Appellants filed an objection and cross motion for summary judgment on May 4, 2011. Appellants admit Alexander signed the note and mortgage on May 5, 2005. Appellants allege, on July 7, 2007, MILA filed for Chapter 11 bankruptcy in the Western District of Washington, and there has been no relief from the automatic stay for the subject property of this action.5 ¶11 The trial court, on June 7, 2011, granted summary judgment in favor of Appellee and awarded Appellee costs and attorney fees. On June 10, 2011, Appellee alleges counsel for Appellants would not sign the journal entry of judgment because he thought attorney fees were unreasonable.6 Appellee filed a motion to settle journal entry on June 17, 2011, and Appellants filed an objection on June 27, 2011. The basis for the objection is that Appellee's attorney fees are unreasonable due to Appellants' inability to determine who was the holder of the note by reason of the inconsistencies in the various pleadings, and Appellees failure to provide loan transfer documents to Appellants when requested in discovery. ¶12 Appellants filed their petition in error on July 7, 2011, and later amended the petition in error to include the file stamped copy of the journal entry of judgment filed August 15, 2011. The Journal Entry of Judgment favored Appellee and found no substantial controversy as to any material fact. The Journal Entry of Judgment also denied Appellants cross motion for summary judgment. STANDARD OF REVIEW ¶13 An appeal on summary judgment comes to this court as a de novo review. Carmichael v. Beller, 1996 OK 48, ¶2, 914 P.2d 1051, 1053. All inferences and conclusions are to be drawn from the underlying facts contained in the record and are to be considered in the light most favorable to the party opposing the summary judgment. Rose v. Sapulpa Rural Water Co., 1981 OK 85, 631 P.2d 752. Summary judgment is improper if, under the evidentiary materials, reasonable individuals could reach different factual conclusions. Gaines v. Comanche County Medical Hospital, 2006 OK 39, ¶4, 143 P.3d 203, 205. ANALYSIS ¶14 Appellant asserts nineteen (19) issues on appeal.7 These include error by the trial court in not requiring more contemporaneous evidence of the transfer of the note and mortgage when allegedly Appellee's counsel and its loan servicer, ASC, did not know which entity had standing to enforce the note. Appellants argue the trial court committed reversible error by not requiring a valid assignment of mortgage prior to commencement of the foreclosure action. Essentially, Appellant is arguing Appellee did not have standing to bring the foreclosure action because there was a material issue of fact as to whether the Appellee was a person entitled to enforce the note at the time Appellee filed its amended petition. Standing is the dispositive issue in this case. ¶15 Appellee argues in its response to petition in error that at no time did appellant ever file an answer and no defenses have ever been asserted or preserved.8 Appellee asserts that Appellants' nineteen (19) issues are either abandoned, expired or are in contravention of established law. Appellees acknowledge the only issues preserved for appeal are those raised by Appellants in pleadings or oral argument. In the opinion of the Appellee, the preserved issues are: 1) did Appellee provide sufficient evidence that it has standing to enforce the note and mortgage; 2) does negotiation of the note carry with it the security interest independent of a formal assignment; 3) if not, is the formal assignment in this matter effective; and 4) are the attorney's fees reasonable. ¶16 As previously identified, the dispositive issue is whether or not Appellee had standing at the time Appellee filed their first amended petition. We hold that the issue of standing as well as other material issues of fact remain that must be determined by the trial court. Therefore summary judgment was inappropriate. ¶17 This Court has previously held: Standing, as a jurisdictional question, may be correctly raised at any level of the judicial process or by the Court on its own motion. This Court has consistently held that standing to raise issues in a proceeding must be predicated on interest that is "direct, immediate and substantial." Standing determines whether the person is the proper party to request adjudication of a certain issue and does not decide the issue itself. The key element is whether the party whose standing is challenged has sufficient interest or stake in the outcome. Matter of the Estate of Doan, 1986 OK 15, ¶7, 727 P.2d 574, 576. In Hendrick v. Walters, 1993 OK 162, ¶4, 865 P.2d 1232, 1234, this Court also held: Respondent challenges Petitioner's standing to bring the tendered issue. Standing refers to a person's legal right to seek relief in a judicial forum. It may be raised as an issue at any stage of the judicial process by any party or by the court sua sponte. (emphasis original) ¶18 Furthermore, in Fent v. Contingency Review Board, 2007 OK 27, footnote 19, 163 P.3d 512, 519, this Court stated "[s]tanding may be raised at any stage of the judicial process or by the court on its own motion." Additionally in Fent, this Court stated: Standing refers to a person's legal right to seek relief in a judicial forum. The three threshold criteria of standing are (1) a legally protected interest which must have been injured in fact- i.e., suffered an injury which is actual, concrete and not conjectural in nature, (2) a causal nexus between the injury and the complained-of conduct, and (3) a likelihood, as opposed to mere speculation, that the injury is capable of being redressed by a favorable court decision. The doctrine of standing ensures a party has a personal stake in the outcome of a case and the parties are truly adverse. Fent v. Contingency Review Board, 2007 OK 27, ¶7, 163 P.3d 512, 519-520. In essence, a plaintiff who has not suffered an injury attributable to the defendant lacks standing to bring a suit. And, thus, "standing [must] be determined as of the commencement of suit; . . ." Lujan v. Defenders of Wildlife, 504 U.S. 555, 570, n.5, 112 S. Ct. 2130, 2142, 119 L. Ed. 351 (1992). ¶19 To commence a foreclosure action in Oklahoma, a plaintiff must demonstrate it has a right to enforce the note and, absent a showing of ownership, the plaintiff lacks standing. Gill v. First Nat. Bank & Trust Co. of Oklahoma City, 1945 OK 181, 159 P.2d 717.9 An assignment of the mortgage, however, is of no consequence because under Oklahoma law, "[p]roof of ownership of the note carried with it ownership of the mortgage security." Engle v. Federal Nat. Mortg. Ass'n, 1956 OK 176, ¶7, 300 P.2d 997, 999. Therefore, in Oklahoma it is not possible to bifurcate the security interest from the note." BAC Home Loans Servicing, L.P. v. White, 2011 OK CIV APP 35, ¶ 10, 256 P.3d 1014, 1017. Because the note is a negotiable instrument, it is subject to the requirements of the UCC. Thus, a foreclosing entity has the burden of proving it is a "person entitled to enforce an instrument" by showing it was "(i) the holder of the instrument, (ii) a nonholder in possession of the instrument who has the rights of a holder, or (iii) a person not in possession of the instrument who is entitled to enforce the instrument pursuant to Section 12A-3-309 or subsection (d) of Section 12A-3-418 of this title." 12A O.S. 2001 § 3-301. ¶20 To demonstrate you are the "holder" of the note you must prove you are in possession of the note and the note is either "payable to bearer" (blank indorsement) or to an identified person that is the person in possession (special indorsement).10 Therefore, both possession of the note and an indorsement on the note or attached allonge11 are required in order for one to be a "holder" of the note. ¶21 To be a "nonholder in possession who has the rights of a holder" you must be in possession of a note that has not been indorsed either by special indorsement or blank indorsement. No negotiation has occurred because the person now in possession did not become a holder by lack of the note being indorsed as mentioned. Negotiation is the voluntary or involuntary transfer of an instrument by a person other than the issuer to a person who thereby becomes its holder. 12A O.S. 2001, § 3-201. Transfer occurs when the instrument is delivered by a person other than its issuer for the purpose of giving to the person receiving delivery the right to enforce the instrument. 12A O.S. 2001, § 3-203. Delivery of the note would still have to occur even though there is no negotiation. Delivery is defined as the voluntary transfer of possession. 12A O.S. 2001, § 1-201(b)(15). The transferee would then be vested with any right of the transferor to enforce the note. 12A O.S. 2001, § 3-203(b). Some jurisdictions have held, without holder status and therefore the presumption of a right to enforce, the possessor of the note must demonstrate both the fact of the delivery and the purpose of the delivery of the note to the transferee in order to qualify as the person entitled to enforce. In re Veal, 450 B.R. 897, 912 (B.A.P. 9th Cir. 2011). See also, 12A O.S. 2001, § 3-203. ¶22 Appellants argue Appellee does not have standing to bring this foreclosure action. Appellee claimed in its first amended petition, by re-alleging all of the allegations in Wells Fargo's original petition, it was the present holder of the note and mortgage. Over a year later in Appellee's second motion for summary judgment, it refers to itself as the current holder and assignee of the mortgage. Not until the second motion for summary judgment did Appellee attach an undated allonge to the note. No other pleading or motion prior to this time contained an indorsement on the note. This allonge was signed by an assistant funding manager of the lender, MILA. Had this allonge been attached to Appellee's first amended petition there would not be an issue as to whether Appellee was the holder of the note upon commencement of its action. However, there still remains the issue of whether or not MILA had been in bankruptcy when the note was transferred and its authority to transfer the note. Therefore, we cannot determine whether Appellee was a holder of the note at the time it filed its first amended petition. This issue of fact must be resolved upon remand to the trial court. Further the assignment of a mortgage which is made effective by its own terms to a timeframe prior to the execution of the original note and mortgage, raises obvious issues of material fact as to the validity of the assignment and the activities of the Appellee. ¶23 The assignments purport to transfer not only the mortgage but also the note. However, these assignments are made by MERS, as nominee for MILA. Neither Oklahoma law nor the mortgage documents define the term "nominee." In the absence of a contractual definition, the parties leave the definition to judicial interpretation. Black's Law Dictionary (9th ed. 2009) defines a nominee as " [a] person designated to act in place of another usu[ally] in a very limited way." (9th ed. 2009). "This definition suggests that a nominee possesses few or no legally enforceable rights beyond those of a principal whom the nominee serves." Landmark Nat. Bank v. Kesler, 289 Kan. 528, 216 P.3d 158, 166 (2009). By definition a "nominee" is substantially the same as the definition of an "agent."12 The legal status of a nominee/agent, then, depends on the context of the relationship of the nominee/agent to its principal. ¶24 MERS is only the nominee of the lender for purposes of the mortgage. Arguably, MERS may be able to assign the mortgage as nominee of the lender, but there is no evidence of authority for MERS to indorse the note. ¶25 Although Appellee has argued it holds the note, the only evidence in the record supporting it was a holder of the note was the allonge which was presented over a year after Appellee filed its first amended petition. As shown, a party must have standing at the time it commences its action. Deutsche Bank National Trust v. Brumbaugh, 2012 OK 3, ___P.3d___. Because standing is the dispositive issue, we will not address the remaining issues on appeal. The determination of the remaining relevant issues must be made by the trial court on remand. CONCLUSION ¶26 It is a fundamental precept of the law to expect a foreclosing party to actually be in possession of its claimed interest in the note, and to have the proper supporting documentation in hand when filing suit, showing the history of the note, so that the defendant is duly apprised of the rights of the plaintiff. This is accomplished by showing the party is a holder of the instrument or a nonholder in possession of the instrument who has the rights of a holder, or a person not in possession of the instrument who is entitled to enforce the instrument pursuant to 12A O.S. 2001, § 3-309 or 12A O.S. 2001, § 3-418. Likewise, for the homeowners, absent adjudication on the underlying indebtedness, today's decisions to reverse the grant of a motion for summary judgment cannot cancel their obligation arising from an authenticated note, or insulate them from foreclosure proceedings based on proven delinquency. See, U.S. Bank National Association v. Kimball, 27 A.3d 1087, 75 UCC Rep.Serv.2d 100, 2011 VT 81 (VT 2011); and Indymac Bank, F.S.B. v. Yano-Horoski, 78 A.D.3d 895, 912 N.Y.S.2d 239 (2010). This Court's decision in no way releases or exonerates the debt owed by the defendants on this home. REVERSED AND REMANDED FOR FURTHER PROCEEDINGS ¶27 CONCUR: TAYLOR, C.J., KAUGER, WATT, EDMONDSON, REIF, COMBS, JJ. ¶28 DISSENT: WINCHESTER (JOINS GURICH, J.), GURICH (BY SEPARATE WRITING), JJ. ¶29 RECUSED: COLBERT, V.C.J. FOOTNOTES 1 On April 15, 2011, Appellee filed a second motion for summary judgment with an attached affidavit. The affiant is an employee of Wells Fargo DBA America's Servicing Company and was dated November 16, 2010. It states that the appellant defaulted on installments due July 1, 2009 and each and every month thereafter. 2 The original note was signed on May 10, 2005. 3 Appellants also challenge the authority of MILA to assign any interest by reason of the bankruptcy action in the Western District of Washington; challenge the signature on the assignment made by an attorney of the Appellees law firm; assert a federal law which prohibits transfers of securitized mortgages ninety days after closing; assert that ASC(Americas Servicing Company) a division of Wells Fargo breached a duty of good faith by offering a "special forbearance agreement", receiving a payment and returning a payment; assert the Uniform Retirement System for Justices and Judges holds assets which include securitized loans and possibly the loan subject to this action , objecting to a member of the system rendering a decision in the matter; 4 December 3, 2010, deposition of John Alexander "[so] at the time, we were getting behind on our payments. We were one month behind." December 3, 2010, deposition of Lisa Alexander, John's wife, "[We] were behind May and June. And in July, I called them to let them know I was going to make May, June and July payments, which was approximately July the 2nd. And they said that the company had already foreclosed." 5 Appellants objection and cross motion raised many of the same issues raised in the response to the first motion for summary judgment including but not limited to; disputing the authority of the attorney of record to sign as a vice president of MERS; Appellants had made three increased payments to ASC, a subsidiary to determine if Appellants could continue in their current payments; also asserting ASC intentionally delayed and harassed the Appellants forbearance agreement efforts and dropped the Appellants forbearance efforts in violation of the Home Affordable Modification Program (HAMP). Appellees replied to the objection to their Summary judgment asserting their possession of the note and the assignment of the mortgage, notwithstanding the effective date stated in the assignment, notwithstanding the assignment of the note at a later date, minimizes the importance of the assignment of the mortgage. Appellee admits to no evidence to support the allegation of a loss of the mitigation effort and forbearance efforts. 6 Plaintiff's Motion to Settle Journal Entry and Application to Tax Costs and Attorney fees filed June 17, 2011. 7 (paraphrased) Did the trial court commit reversible error: 1) when applying the case law of local community banks being in possession of the original note and mortgage as proof of their standing to sue when a securitized mortgage trust portfolio is involved; 2) in not requiring more contemporaneous evidence of the transfer of note and mortgage in light of the loan servicer, ASC and plaintiff's counsel not knowing the real party in interest; 3) in not requiring plaintiff to have a valid assignment of mortgage prior to commencement of suit; 4) granting the earlier default judgment and failure to grant defendant's cross motion for summary judgment; 5) in granting substitution of parties without new summons being issued and served; 6) by granting summary judgment to plaintiff and not to defendants when pleadings state Wells Fargo was the holder of the note on July 23, 2009, and that date and October 6, 2009, the note and mortgage were transferred to US Bank NA when the assignment of mortgage, filed on August 13, 2009, purported to be effective March 1, 2005, seventy (70) days prior to date of note and mortgage; 7) in recognizing an assignment of real estate mortgage executed by an attorney whose last name is in the firm's name of plaintiff's counsel as an authorized party; 8) in acknowledging an assignment of real estate mortgage with a prior effective date; 9) in acknowledging a corrective assignment of mortgage only filed with the court in a reply to a cross motion for summary judgment on May 26, 2011; 10) in not requiring proof of plaintiff's loan servicer giving a reason for the unexplained discontinuation of the forbearance agreement, even after limited discovery responses, when their records show the payments were made; 11) in not requiring plaintiff to offer HAMP after or if plaintiff proves it is the real party in interest; 12) in not considering the effect of MILA's ongoing Chapter 11 bankruptcy on its authority to assign notes and mortgages; 13) in not considering the effect of plaintiff's own prospectus prohibiting transfers into the Trust after ninety (90) days; 14) in granting summary judgment in light of this ninety (90) day requirement when plaintiff's own counsel argues that the assignment of real estate mortgage also transferred the note which date is either August 13, 2009, or, according to the corrective assignment, August 18, 2010; 15) in not requiring more substantial proof than the accompanying affidavit that the file was in order, as both affidavits covered a file that contains an assignment of real estate mortgage bearing an effective date seventy (70) days prior to the actual execution of the mortgage; 16) in not considering whether the Trust's governing state law allows the trustee to waive the ninety (90) day transfer requirement; 17) by not finding that any Oklahoma court should recuse itself because the Uniform Retirement System for Justices and Judges has assets with Credit Suisse First Boston's HEAT pooled securitized loans; 18) granting attorney fees which would not have occurred but for plaintiff's own timeline pleading errors and admitted by virtue of corrective, defective assignments of real estate mortgage; 19) in awarding attorney fees that were the result of plaintiff's errors. 8 The order vacating the judgment did not require Appellants to file an answer. Rule 13 of the Rules of the District Courts of Oklahoma allows a motion for summary judgment to be filed "any time after the filing of the action." 12 O.S. Supp. 2002, ch.2, app. (Rule 13(a)). The rule only requires a defendant to file a "concise written statement of the material facts as to which a genuine issue exists and the reasons for denying the motion." 12 O.S. Supp. 2002, ch.2, app. (Rule 13(b)). It also requires the adverse party to "attach to the statement evidentiary material justifying the opposition to the motion." It appears Appellants substantially complied with this rule by their assertions in their counter motion for summary judgment. 9 This opinion occurred prior to the enactment of the Oklahoma UCC. It is, however, possible for the owner of the note not to be the person entitled to enforce the note if the owner is not in possession of the note. (See the REPORT OF THE PERMANENT EDITORIAL BOARD FOR THE UNIFORM COMMERCIAL CODE, APPLICATION OF THE UNIFORM COMMERCIAL CODE TO SELECTED ISSUES RELATING TO MORTGAGE NOTES (NOVEMBER 14, 2011)). 10 12A O.S. 2001, §§ 1-201(b)(21), 3-204 and 3-205. 11 According to Black's Law Dictionary (9th ed. 2009) an allonge is "[a] slip of paper sometimes attached to a negotiable instrument for the purpose of receiving further indorsements when the original paper is filled with indorsements." See, 12A O.S. 2001, § 3-204(a). It should be noted that under 12A O.S. 2001, § 3-204(a) and its comments in paragraph 2, it is no longer necessary that an instrument be so covered with previous indorsements that additional space is required before an allonge may be used. An allonge, however, must still be affixed to the instrument. 12 Black's Law Dictionary defines "agent" as "[o]ne who is authorized to act for or in place of another; a representative." 9th ed. 2009. GURICH, J., with whom WINCHESTER, J. joins dissenting: ¶1 I respectfully dissent. Although the majority in this case reverses summary judgment to resolve factual issues on remand, a careful look at the record reveals no issues of material fact remain, and the majority's reversal is based solely on the issue of standing. The record in this case indicates that after substituting the correct plaintiff, filing an amended petition, and filing a motion for summary judgment, which was denied by the trial court because issues of material fact remained, Plaintiff filed a second motion for summary judgment. Attached to Plaintiff's Second Motion for Summary Judgment was an indorsed-in-blank allonge, the mortgage, an assignment of mortgage, and an affidavit in support of the motion for summary judgment. Because the Plaintiff was the proper party to pursue the foreclosure and because the Plaintiff presented the proper documentation at summary judgment to prove such, the trial court was correct in granting summary judgment to plaintiff. I would affirm the trial court for the reasons stated in my dissenting opinions in Deutsche Bank National Trust Co. v. Matthews, 2012 OK 14, ___P.3d___ (Gurich, J., dissenting) and Bank of America, NA v. Kabba, 2012 OK 23, ___P.3d___ (Gurich, J., dissenting).1 FOOTNOTES 1 Although I originally concurred in the majority opinion in Deutsche Bank National Trust v. Brumbaugh, 2012 OK 3, ___P.3d___, which the majority now cites as authority in this case, after further consideration, I disagree with the majority's analysis in that case, and my views on the issues in these cases are accurately reflected in J.P. Morgan Chase Bank N.A. v. Eldridge, 2012 OK 24, ___P.3d___ (Gurich, J., concurring in part and dissenting in part); Kabba, 2012 OK 23, ___P.3d___ (Gurich, J., dissenting); CPT Asset Backed Certificates, Series 2004-EC1 v. Kham, 2012 OK 22, ___P.3d___ (Gurich, J., dissenting); Deutsche Bank National Trust Co. v. Richardson, 2012 OK 15, ___P.3d___ (Gurich, J., concurring in part and dissenting in part); and Matthews, 2012 OK 14, ___P.3d___ (Gurich, J., dissenting).

07ad818b-77c9-4858-9451-c95f06ce0abe

Yzer, Inc. v. Rodr

oklahoma

Oklahoma Supreme Court

YZER, INC. v. RODR2012 OK 50Case Number: 109150Decided: 06/05/2012THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. YZER, INC., and/or FUNNEL DESIGN GROUP and SENTINEL INSURANCE CO., LTD., Petitioners, v. BARTON J. RODR and THE WORKERS' COMPENSATION COURT, Respondents. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIV. III ¶0 The Workers' Compensation Court granted temporary total disability benefits and further medical treatment to injured worker, finding that he was an employee and not a volunteer, and that his injury arose out of and in the course of his employment. That order was unanimously affirmed by the three-judge panel of the Workers' Compensation Court. The Court of Civil Appeals vacated the order, finding that the injury did not arise in the course of his employment. We granted the employee's petition for certiorari. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; AWARD SUSTAINED. Leah P. Keele, Lori R. Whitworth, Brian J. Goree, Ambar I. Malik, LATHAM WAGNER STEELE & LEHMAN, P.C., Tulsa, Oklahoma, for the Petitioners. Terry Gust, Midwest City, Oklahoma, for the Respondents. EDMONDSON, J. ¶1 The claimant, Barton J. Rodr, was a full-time computer programmer employed by Yzer, Inc. and /or Funnel Design Group. He suffered a heart attack while doing lawn work for his employer on the employer's premises Saturday, July 18, 2009. He was not paid anything additional for the lawn work. The claimant sought workers' compensation benefits, which were denied by the employer. The employer denied that Rodr was working as an employee at the time of injury and claimed that the injury was not incurred during the course and scope of his employment. Employer asserted that the claimant was acting as a volunteer when injured. ¶2 The workers' compensation court awarded benefits, determining that claimant was not acting as a volunteer and that he sustained an accidental injury to the heart (myocardial infarction) arising out of and in the course of his employment. The three-judge panel unanimously affirmed. The employer appealed, asserting that the claimant did not meet the statutory definition of an employee under the workers' compensation act and that the accidental injury did not occur in the course and scope of employment.1 The Court of Civil Appeals vacated the order, finding it to be against the clear weight of the evidence and contrary to law because claimant's performance of lawn work at the time of his injury was outside his employment and was not related to or incidental to his computer programmer job, and was therefore not compensable.2 STANDARD OF REVIEW ¶3 In workers' compensation cases we are not bound by the lower court's determination of jurisdictional facts.3 Whether a claimant is acting as an employee at the time of injury is a jurisdictional fact and the Supreme Court will review the record to make an independent finding on that issue. Mahan v. NTC of America, 1992 OK 8 ¶5, 832 P.2d 805. The workers' compensation court is without jurisdiction to make an award for an injury that did not arise out of and in the course of employment. Chicago Pneumatic Tool Co. v. McGrew, 1936 OK 805, 63 P.2d 749, 750. On original proceedings to review a compensation award, this Court will make an independent review of the conclusion of law that the accidental injury arose out of and in the course of employment. City Bus Co. v. Lockhart, 1951 OK 86, 229 P.2d 586. ¶4 The statutory definition of employee at the time of claimant's injury was found at 85 O.S. Supp. 2005 §3(9). It provided, in pertinent part, that: . . . "employee" shall not include any other person providing or performing voluntary service who receives no wages for the services other than meals, drug or alcohol rehabilitative therapy, transportation, lodging or reimbursement for incidental expenses.4 (emphasis added) This statutory definition of "volunteer" does not apply to the case at bar because the claimant was not "any other person" performing voluntary service without pay. The claimant was a salaried employee at the time of his injury and was working at his employer's behest, on the employer's premises. The employer admits that the claimant was employed as a computer programmer at the time of the injury. The employer asked for help with the yard work at the office and the employee volunteered to help. That Rodr "volunteered" to help his employer does not mean that he became a "volunteer" as defined in the workers' compensation act. ¶5 A compensable work-related injury must both arise out of and occur in the course of the worker's employment. Lanman v. Okla. Co. Sheriff's Office, 1998 OK 37 ¶ 8, 958 P.2d 795. A claimant has the burden of establishing both. "Arising out of employment" contemplates a causal relationship between the act engaged in at the time injury occurs and the requirements of employment. It requires a determination whether the injury for which compensation is sought has the requisite connection to the job. "In the course of employment" relates to the time, place or circumstances under which the injury is sustained. It tests whether at the critical moment, the claimant was on a mission for the employer. An employee is deemed to have deviated from the course of employment when he or she embarks on a purely personal errand or is beyond the assigned perimeter of the claimant's mission for the employer. ¶6 The workers' compensation court correctly found that the jurisdictional prerequisite of an employee/employer relationship existed at the time of claimant's accidental injury. It has long been settled in Oklahoma that an employee does not cease to be in the course of his employment merely because he is not actually engaged in doing some specifically prescribed task if, in the course of his employment, he does some act which he deems necessary for the benefit or interest of his employer. Associated Employer's Reciprocal v. State Industrial Comm'n, 1921 OK 281, 200 P. 174, syllabus 2. When an employee is engaging in a special task that deviates from his normally assigned duties, he is not necessarily disqualified from receiving workers' compensation benefits. See Harris v. La Quinta, 1997 OK 50, 937 P.2d 89 (discussing special-task exception to noncompensability). Whether a claimant's injury arises out of and in the course of the employment is, like the rest of the Workers' Compensation Act, to be liberally construed in favor of the employee. Wal-Mart Stores, Inc. v. Switch, 1994 OK 59 ¶ 5, 878 P.2d 357, 359. ¶7 The test is whether the work is necessary for the benefit or interest of the employer. Here, the employer specifically asked for volunteers to help with the yard work to make the grounds look nice for the grand reopening of Automobile Alley. The claimant and his thirteen-year-old son performed those duties. The employer then hired claimant's thirteen-year-old son to continue the yard work. The claimant drove his son to the office on two more Saturdays and helped him with the yard work. The claimant received no additional pay for the yard work; his son was paid $40.00 for the work. After helping his son with the yard work on the third occasion, claimant was reloading the mower and equipment when he sustained a myocardial infarction. The employer's yard crew had quit and the claimant was performing that task to help out the employer, at the employer's request. The yard work was for the benefit of the employer and was not in furtherance of a personal mission. The facts reflect that the claimant was performing a special task for his employer and that his accidental injury arose out of and was within the course of his employment. ¶8 Finally, we turn to employer's assertion, not addressed by the Court of Civil Appeals, regarding preexisting conditions and that the exertion necessary to produce the harm was not extraordinary and unusual. A heart-related or vascular injury is compensable if it is demonstrated that the exertion necessary to produce the harm was extraordinary and unusual in comparison to other occupations and that the occupation was the major cause of the harm. 85 O.S. Supp. 2005 § 3(13)(b). Employer argued that the claimant had preexisting conditions that were, rather than his employment, the major cause of his heart attack. The employer pointed to the employee's family history, his weight, medical history and that he was a smoker. An employer takes a worker as it finds him or her, and even where one is prone to a particular injury it is compensable if it is not idiopathic. Pauls Valley Travel Center v. Boucher, 2005 OK 30 ¶ 14,112 P.3d 1175, 1182. The trial judge determined that claimant suffered a heart-related injury, the major cause of which was his employment wherein the claimant was engaged in extraordinary and unusual exertion compared to other employment. We agree with the trial judge that the yard work being done by claimant was extraordinary and unusual exertion when compared to his job as a computer programmer and that the major cause of injury was his employment. ¶9 For these reasons, we vacate the opinion of the Court of Civil Appeals and sustain the award entered by the workers' compensation court. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS VACATED; AWARD SUSTAINED. ¶10 ALL JUSTICES CONCUR FOOTNOTES 1 The employer's petition in error raised three issues: 1. The court erred in finding Claimant was acting as an employee at the time of his alleged injury rather than a volunteer. 2. The court erred in finding Claimant's employment was the major cause of injury to the heart (myocardial infarction). 3. The court erred in awarding Claimant temporary total disability benefits and medical treatment since his injury did not occur within the course and scope of employment. 2 The Court of Civil Appeals applied the standard of review set forth in 85 O.S. 2011 § 340, which went into effect on August 26, 2011. Because we determine that the de novo standard of review applies, we need not determine whether or not the new standard of review applies to injuries occurring prior to the effective date of the statute. See, Dunlap v. Multiple Injury Trust Fund, 2011 OK 14, 249 P.3d 951 (holding that the 2010 amendment of § 3.6(C), effective November 1, 2010, applied prospectively to claims for injuries that occur after the effective date of the amendment.) 3 In workers' compensation jurisprudence, jurisdiction is used in two different contexts. More often it refers to a jurisdictional issue, such as that which is tendered when the claimant's status qua respondent's employee is in contest. Once an issue is identified as jurisdictional it calls for a de novo review. Stidham v. Special Indemnity Fund, 2000 OK 33 ¶ 10, 10 P.3d 880. 4 This statute was repealed by Laws 2011, ch. 318 §40, eff. August 26, 2011. The volunteer language is now found in 85 O.S. 2011 § 311(8). Title 85 O.S. 2011 § 308(17) defines employee, in pertinent part, as any person engaged in the employment of an employer covered by the terms of the Workers' Compensation Code except for such persons as may be excluded elsewhere in the act.