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decided: October 29, 1984.


Original jurisdiction in case of National Home Life Assurance Company and Veterans Life Insurance Company v. Insurance Department, Commonwealth of Pennsylvania, and The Honorable Anthony Geyelin, Acting Insurance Commissioner.


John Havas, with him, S. Walter Foulkrod, III and James Reynolds, Jr., Foulkrod, Reynolds & Havas, for petitioners.

Michael L. Harvey, Deputy Attorney General, with him, Allen C. Warshaw, Chief, Litigation Section, and LeRoy S. Zimmerman, Attorney General, for respondents.

Judges Rogers, Craig and Barbieri, sitting as a panel of three. Opinion by Judge Craig.

Author: Craig

[ 85 Pa. Commw. Page 590]

National Home Life Assurance Company and Veterans Life Insurance Company have filed a petition for review in our original jurisdiction seeking to enjoin the Pennsylvania Insurance Department and Acting Insurance Commissioner Anthony Geyelin from conducting administrative proceedings pursuant to a show cause order which the department had issued to the two companies. Geyelin and the department have filed preliminary objections in the nature of a petition to dismiss for failure to exhaust administrative remedies, a suggestion of mootness*fn1 and a demurrer.

On February 2, 1984, the department issued a show cause order which alleged that the companies had violated the Unfair Insurance Practices Act, Act of July 22, 1974, P.L. 589, 40 P.S. §§ 1171.1-1171.15, by conducting

[ 85 Pa. Commw. Page 591]

    several mail solicitation campaigns designed to induce the misconception that the federal government either sponsored or endorsed the offered insurance.

The companies then filed this petition for review, seeking an injunction of the administrative process because Commissioner Geyelin and department counsel had allegedly commingled investigative, prosecutorial and adjudicative functions, thereby violating the companies' constitutional due process rights.

In their preliminary objections, the department and the commissioner first contend that the companies have available a full and adequate remedy at law, and therefore we should dismiss the petition for failure to exhaust administrative remedies.*fn2 We agree.

The law is well settled that a party may not challenge administrative decision-making through the vehicle of judicial review without first exhausting all administrative remedies. Canonsburg General Hospital v. Department of Health, 492 Pa. 68, 422 A.2d 141 (1980). "[P]remature interruption of the administrative process restricts the agency's opportunity to develop an adequate factual record, limits the agency in the exercise of its expertise and impedes the development of a cohesive body of law. . . ." Shenango Valley Osteopathic Hospital v. Department of Health, 499 Pa. 39, 47, 451 A.2d 434, 438 (1982).

The companies contend that the administrative remedy is inadequate here because of bias on the part of the commissioner, who has the power to preside at the administrative hearing. Although Acting Commissioner

[ 85 Pa. Commw. Page 592]

Geyelin, pursuant to his authority under 1 Pa. Code § 35.186, here appointed a presiding officer to conduct the hearings in this case, the companies argue that the commissioner not only attended, but actually presided over some initial hearings, and that his influence has permanently tainted the fairness of the administrative proceedings.

In support of their contention that this court may properly enjoin the continuance of the administrative process, the companies cite several cases from our Supreme Court; however, in each of those cases, the administrative agency involved did not have the authority to determine the relevant issues, and consequently, the administrative remedy was inadequate.*fn3 The Supreme Court specifically noted in one of those cases that where the requested relief would be to enjoin further administrative action, the case law supports the position that equity should not interfere with the administrative process. Feingold v. Bell of Pennsylvania, 477 Pa. 1, 9-10 n. 5, 383 A.2d 791, 795 n. 5 (1977).

The present case is more closely analogous to our recent decision in Tulio v. State Horse Racing Commission, 79 Pa. Commonwealth Ct. 305, 470 A.2d 645 (1984), where the petitioner sought injunctive relief to negate an administrative determination alleging

[ 85 Pa. Commw. Page 593]

    bias and commingling of functions on the part of an administrative official. We concluded that a traditional appeal from that administrative decision was adequate and would fully protect the petitioner's due process rights.*fn4

We see no reason to depart from that approach in the present case. At this juncture, we cannot properly address the question of whether the administrative process -- which is only partially completed -- would result in a denial of the companies' constitutional rights.

The administrative process should continue to its conclusion, and the companies should present any objections they have to the presiding officer. Should they be dissatisfied with the final decision, they may then raise the due process issue on appeal to this court. 42 Pa. C.S. § 763(a).

Because we sustain the respondents' preliminary objection addressed to the exhaustion of administrative remedies, we need not address the suggestion of mootness or the demurrer.

Accordingly, the petition for review is dismissed.


Now, October 29, 1984, preliminary objection number 1 of the Department of Insurance and Acting Insurance Commissioner is sustained, and the petition

[ 85 Pa. Commw. Page 594]

    for review is dismissed. Accordingly, the per curiam order of this court, dated October 11, 1984, setting a preliminary injunction hearing, is hereby vacated.


Preliminary objection sustained. Case dismissed.

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