Anawan Insurance Agency, Inc. v. Division of Insurance, 946 N.E.2d 688

Division of Insurance brought an administrative enforcement action against Anawan Insurance Agency, Inc. and Stephen G. Michaels for paying commissions to an unlicensed broker in violation of G. L. c. 175, § 177 and G. L. c. 176D, § 2.
Hearing officer held four-year limit of G. L. c. 260, § 5A (consumer-protection actions) applied to § 177, tolled by discovery for violations before October 2000, and fined under c. 176D, § 2 rather than under c. 177.
Appeals Court held § 5A applied but discovery rule did not toll; also held fines could be imposed only under § 177, not under § 176D, § 7.
Mass Supreme Judicial Court granted division’s request for further appellate review and affirmed, reconciling limitations and penalties across statutes.
Court reasoned c. 176D, § 12 permits separate penalties under both c. 176D and c. 175, § 177 when violations are found under each statute.
Key factual timeline: complaint process began Oct. 25, 2004; conduct spanned 1997–2004; discovery tolling extended the effective limitations period for pre-2000 violations.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Which statute of limitations governs § 177 actions?	Anawan asserted § 5 governs (two-year limit; § 5A not applicable).	Division contends § 5A applies to consumer-protection actions including penalties; applies to § 177 due to consumer-protection purpose.	§ 5A governs § 177 actions.
Does the discovery rule apply to § 5A limitations?	Discovery rule should toll § 5A for pre-2000 violations.	Discovery rule does not apply to toll § 5A actions.	Yes, the discovery rule applies to § 5A.
Can penalties be imposed under both c. 176D, § 2 and c. 175, § 177?	Division may seek penalties only under § 177; § 176D penalties are not applicable to this enforcement.	General penalties could be imposed under § 176D, and § 12 allows additional penalties for deceptive practices.	Permissible to impose separate penalties under both statutes.
Are pre-2000 violations time-barred given tolling under discovery rules?	Discovery tolling extends the period so pre-2000 violations are actionable.	Discovery tolling does not apply to § 5A; older violations may be time-barred.	Pre-2000 violations tolled under the discovery rule; not time-barred.
Does amended § 177 apply to require knowing violations?	Amendment requiring knowing violations could affect penalties.	Amendment not applicable to this case.	Amendment not applicable; the case proceeded under prior law.

Micera v. Neworld Bank, 412 Mass. 728 (1992) (consumer-protection statute § 5A applicable; accrual based on consumer-protection purpose)
Lambert v. Fleet Nat’l Bank, 449 Mass. 119 (2007) (discovery rule applied to § 5A actions)
Albrecht v. Clifford, 436 Mass. 706 (2002) (recognizes § 5A discovery rule in consumer-protection context)
Anawan Ins. Agency, Inc. v. Division of Ins., 76 Mass. App. Ct. 447 (2010) ( appellate treatment of limitations and penalties under consumer-protection statutes)
Deluty v. Commissioner of Ins., 7 Mass. App. Ct. 88 (1979) (consumer-protection context and licensure concerns in insurance)
Commonwealth v. Roswell, 173 Mass. 119 (1899) (police-power licensing of insurance brokers/agents)