STATE of Georgia Et Al. v. INTERNATIONAL INDEMNITY COMPANY Et Al. Regulatory Technologies, Inc. v. State of Georgia.
809 S.E.2d 64
| Ga. Ct. App. | 2017Background
- In 2001 the Georgia Insurance Commissioner was appointed liquidator of International Indemnity Company (IIC); Regulatory Technologies, Inc. (Reg Tech) and its CEO Harry Sivley assisted in the liquidation and billed administrative expenses to the estate.
- After liquidation, Sun States (IIC’s sole shareholder) objected to the liquidator’s final accounting, alleging excessive administrative expenses, overallocated contract compensation, and improper payments to Reg Tech/Sivley; an auditor reported credits due to the estate but continued to question administrative charges.
- The liquidator (the State, on relation of the Commissioner) filed for discharge after submitting a modified accounting; Sun States sought surcharge relief and attorney’s fees and requested an independent audit/review.
- The trial court denied the State’s motion to dismiss on sovereign-immunity grounds, concluding the Insurers Rehabilitation and Liquidation Act (the Act) impliedly waived sovereign immunity for repayment of excessive administrative expenses and for attorney fees, and allowed evidence on attorney fees.
- On prior appeal this Court found error in the waiver ruling, but the Georgia Supreme Court vacated that opinion on interlocutory jurisdictional grounds; on remand the trial court re-entered its order and certified it for immediate review, leading to the present appeals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Insurers Rehabilitation and Liquidation Act impliedly waives sovereign immunity for claims to recover excessive administrative expenses and attorney fees | Sun States: Act’s provisions (e.g., authority to fix/pay reasonable administrative costs; priority for costs of administration; court power to audit and discharge) evidence waiver allowing recovery from the State/liquidator | State/Reg Tech: No specific statutory waiver exists; sovereign immunity bars money judgments absent a specific waiver stating extent | Reversed: Court held the Act does not specifically waive sovereign immunity nor state the extent of any waiver; implied waiver not allowed, so State cannot be held liable under the Act for those money claims |
| Whether OCGA §33-37-8.1(b) (receiver and employee official immunity) bars Sun States’ claims on discharge or is inapplicable | Sun States: The statute’s intentional/wanton-misconduct exception means the court may consider evidence that liquidator/deputies engaged in intentional or willful and wanton misconduct that permits surcharge relief | State/Reg Tech: Section 8.1(b) provides broad official immunity shielding receiver and employees from suit and liability for acts arising from duties | Affirmed in part and remanded: Court did not rule the statute inapplicable. It held the trial court may consider evidence and the statutory exception for intentional/wanton misconduct; remanded to consider claims and relief under §33‑37‑8.1(b) |
Key Cases Cited
- Lathrop v. Deal, 301 Ga. 408 (2017) (sovereign immunity bars suits against the State absent a legislative waiver)
- Gilbert v. Richardson, 264 Ga. 744 (1994) (Georgia Constitution requires legislative act that specifically provides the waiver and its extent)
- Currid v. DeKalb State Court Probation Dept., 285 Ga. 184 (2009) (implied waivers of governmental immunity are disfavored)
- Georgia Dept. of Corrections v. Couch, 295 Ga. 469 (2014) (legislature need not use “magic words,” but statutory language must create a specific waiver)
- Colon v. Fulton County, 294 Ga. 93 (2013) (where statute creates a right of action and authorizes money damages from the government, waiver is clear)
- Williamson v. Dept. of Human Resources, 258 Ga. App. 113 (2002) (statutory causes of action that can yield money judgments against the state effect a waiver to that extent)
- Ga. Dept. of Natural Resources v. Center for a Sustainable Coast, 294 Ga. 593 (2014) (where statute fails to state extent of waiver, no waiver is found)
- State of Ga. v. Sun States Ins. Group, 332 Ga. App. 197 (2015) (earlier appellate ruling addressing waiver issue; reasoning persuasive though previously vacated on jurisdictional grounds)
- State of Ga. v. Sun States Ins. Group, 299 Ga. 489 (2016) (Supreme Court opinion vacating prior appellate decision on interlocutory appeal procedures)