Knowlton v. Attorney General

2009 ME 79, 976 A.2d 973, 2009 Me. LEXIS 82
CourtSupreme Judicial Court of Maine
DecidedJuly 28, 2009
StatusPublished
Cited by14 cases

This text of 2009 ME 79 (Knowlton v. Attorney General) is published on Counsel Stack Legal Research, covering Supreme Judicial Court of Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Knowlton v. Attorney General, 2009 ME 79, 976 A.2d 973, 2009 Me. LEXIS 82 (Me. 2009).

Opinion

LEVY, J.

[¶ 1] This appeal stems from a complaint filed by Alan D. Knowlton seeking money damages against the Attorney General and Superintendent of Insurance for their alleged breach of a consent agreement. The Attorney General and the Superintendent of Insurance (collectively, the State) appeal from the Superior Court’s (Penobscot County, Anderson, J.) partial denial of their motion for a summary judgment. They assert that the State has sovereign immunity with respect to claims for monetary damages arising out of an alleged breach of the consent agreement. We conclude that the State is immune from suit, vacate the judgment, and remand for entry of a summary judgment in favor of the State.

I. BACKGROUND

[¶ 2] Viewed in the light most favorable to the nonmoving party, the summary judgment record supports the following facts. See Jorgensen v. Dep’t of Transp., 2009 ME 42, ¶ 2, 969 A.2d 912, 914.

[¶ 3] Bankers Life and Casualty Company is an insurance company with offices in Bangor and South Portland. Between January 2002 and April 2005, the Maine Bureau of Insurance received seventy complaints from consumers that the State asserts primarily related to claims that Bankers Life had improperly marketed insurance policies to elderly consumers by, among other things, setting up meetings with older consumers under the guise of discussing changes to the Medicare law and selling annuities that were not actually suitable for elderly people. Approximately thirteen of the seventy complaints involved salespersons out of the Bangor office, and the rest referred to the South Portland office. Knowlton was the branch sales manager of the Bangor Office.

[¶ 4] On March 28, 2005, Knowlton entered into a consent agreement with the State to resolve licensing violations associated with two incidents at a sales recruitment meeting during which he misrepresented the financial strength rating of Bankers Life in a conversation with a potential recruit and through distribution of a misleading brochure. The agreement described the incidents, and required Knowlton to pay a $750 civil penalty, submit to a 270-day period of license probation, and comply with various other requirements concerning recruiting materials and the reporting of consumer complaints. Of particular significance to this appeal, the consent agreement provided:

In consideration of Mr. Knowlton’s execution of and compliance with the terms of this Consent Agreement, the Superintendent and the Attorney General agree to forgo pursuing further disciplinary measures or other civil or administrative sanctions against Mr. Knowlton for the violations described in the Stipulations, other than those agreed to in' this Consent Agreement.

[¶ 5] Bankers Life entered into its own consent agreement with the State about two weeks later. Included among the complaints settled by the agreement with Bankers Life were the two concerning the misrepresentation of financial strength that had been brought against Knowlton. The Bankers Life consent agreement was finalized on April 14, 2005. It required, among other things, that Bankers Life “relieve the managers of its South Portland and Bangor branch offices of their positions as branch managers.”1 The Bankers Life and Knowlton consent agreements [976]*976each provided that the agreement was “not subject to review or appeal,” and that it “is enforceable by an action in the Superior Court.”

[¶ 6] When Knowlton was informed of his termination as manager of the Bangor office, Bankers Life officials represented to him that “they had ‘fought’ for his job but that ‘the [S]tate wouldn’t hear of it’ and instead ‘demanded’ ” that Knowlton be removed as manager. Knowlton now believes that these representations may not have been truthful. Following a paid leave of absence and subsequent short-term disability leave, Knowlton became a unit sales manager for Bankers Life in Boston. In July 2006, Bankers Life put Knowlton on an unpaid leave of absence, and after various communications concerning whether Knowlton would accept an additional demotion, he was eventually terminated or constructively discharged by Bankers Life in approximately October 2006.

[¶ 7] In April 2007, Knowlton brought suit against the State, asserting that the State had breached his consent agreement by entering into the subsequent consent agreement with Bankers Life because the subsequent agreement called for Knowl-ton’s termination as the Bangor branch manager, and Knowlton maintained that that requirement constituted further disciplinary action against him. He also asserted violations of 42 U.S.C.S. § 1983 (2002) for the deprivation of property without due process of law, alleging that he had been subject to double jeopardy, and for the unconstitutional impairment of contractual obligations. He also sought a declaratory judgment that the State had breached the consent agreement. His complaint alleged that he was “forced to leave a position he held for 20 years and has suffered severe and debilitating economic and emotional distress.” It demanded judgment “in such amount as is reasonable in the premises, plus interest, costs and such other and further relief as this Court deems just and proper.”

[¶ 8] The State moved for a summary judgment, asserting, among other things, that the consent agreement with Knowlton was not a contract that would abrogate the State’s immunity from suit. The court granted a summary judgment with respect to all the complaint’s counts, except for the breach of contract claim. In its analysis, the court reasoned that there is “no dis-cernable difference between a settlement agreement in the context of civil litigation and a consent agreement in the context of administrative adjudications; therefore, the consent agreement in this case should be analyzed as a contract.” The court determined that 10 M.R.S. § 8003(5)(B) (2005),2 which provides that “[a] consent [977]*977agreement is enforceable by an action in Superior Court,” constitutes an explicit waiver of sovereign immunity, permitting “enforcement of a consent agreement in the same way that any other contract may be enforced, including remedies at law and equity.” The court further concluded that there was a dispute of material fact as to whether the State had breached Knowl-ton’s consent agreement by entering into the subsequent agreement with Bankers Life.3 The court denied a subsequent motion by the State for reconsideration.

[¶ 9] The State appeals the court’s denial of its motion for a summary judgment on the breach of contract claim, arguing that it is immune from suit, and in the alternative, that the undisputed facts establish that it did not breach the consent agreement. Knowlton has not cross-appealed from the portion of the court’s order granting a summary judgment in favor of the State on all other claims.

II. DISCUSSION

[¶ 10] An interlocutory appeal from the partial denial of a summary judgment motion is generally precluded by the final judgment rule. See Webb v. Haas, 1999 ME 74, ¶ 5, 728 A.2d 1261, 1264. Immediate review is permitted pursuant to the death knell exception, however, where the motion was based on a claim of immunity. Id. Such is the case here. We review a court’s decision on a summary judgment motion de novo. Addy v. Jenkins, Inc., 2009 ME 46, ¶ 7, 969 A.2d 935, 938.

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Bluebook (online)
2009 ME 79, 976 A.2d 973, 2009 Me. LEXIS 82, Counsel Stack Legal Research, https://law.counselstack.com/opinion/knowlton-v-attorney-general-me-2009.