OFFICE OF INSUHANCE COMMISSIONER - Wa

BEFORE THE STATE OF WASHINGTON FILEDOFFICE OF INSURANCE COMMISSIONER

1013 JUL - 3 A \j: DI

In the Matter of: DocketNo. 18-0150 HEA@IGS UNIT

OFFICE OF INSUHANCE COMMISSIONER

MICHAEL MURPHY, ORDER GRANTING THE OIC'S MOTION FOR SUMMARY

Applicant. JUDGMENT

TO: Michael Murphy 1035 S. McMillan Ct. Spokane Valley, WA 99016

COPY TO: Mike Kreidler, Insurance Commissioner James T. Odiorne, J.D., CPA, Chief Deputy Insurance Commissioner Melanie Anderson, Deputy Commissioner, Consumer Protection Division Jeff Baughman, Licensing & Education Manager, Consumer Protection Division Toni Hood, Deputy Commissioner, Legal Affairs Division Darryl Colman, Insurance Enforcement Specialist, Legal Affairs Division Office of the Insurance Commissioner PO Box40255 Olympia, WA 98504-0255

Introduction.

This case comes before me on the Office of the Insurance Commissioner's ("OIC's")

Motion for Summary Judgment ("Motion"). I have considered the Motion, and the Declaration

of Cheryl Penn in Support of the OIC's Motion ("Deel. of Penn"), both filed on May 24, 2018.

Issues.

In briefing in support of its Motion, among other things, the OIC presents the following

issues:

1. Does the collateral estoppel doctrine, or issue preclusion, bar Michael Murphy from relitigating whether he violated RCW 48.17.530(1)(g), (l)(h) and (l)G) because in Finding of Facts, Conclusions of Law and Final Order the undersigned

filed in OIC Docket No. 17-0314 on February 23, 2018 he held that Mr. Murphy did and revoked his insurance producer license? Short Answer: Yes.

2. If so, pursuant to RCW 48.17.090(2) and RCW 48.17.530(1), must the undersigned deny Mr. Murphy's application for reinstatement of his insurance producer license? Short Answer: Yes.

Given these answers, and for the reasons outlined below, I grant summary judgment in

favor of the OIC.

Background.

On February 23, 2018, I entered Findings of Fact, Conclusions of Law and Final Order in

OIC Docket No. 17-0314 ("Final Order"). See Deel. of Penn, Ex. 1. In the Final Order, after

considering the evidence in the record, I held that Michael Murphy violated RCW

48.17.530(1)(g) (by virtue of his violation ofRCW 48.30.210), RCW 48.17.530(1)(h) and RCW

48.17.530(1)(j). Id. On March 6, 2018, Mr. Murphy filed a Petition for Reconsideration

("Petition") with the OIC Hearings Unit concerning the Final Order. On March 13, 2018, I

denied Mr. Murphy's Petition.

On March 22, 2018, Michael Murphy applied for reinstatement of his revoked insurance

producer license in the life and disability lines. Deel. of Penn,~~ 7 and 11, and Ex. 2. On March

28, 2018, Cheryl Penn, Producer Licensing and Oversight Compliance Supervisor with the

OIC's Consumer Protection Division, informed Mr. Murphy that the OIC had denied his

application for reinstatement for the reasons set forth in the Final Order. Deel. of Penn,~~ 2, 8, 9

and 12, and Ex. 2. On April 6, 2018, Mr. Murphy filed a Demand for Hearing with the OIC,

challenging the OIC's denial of his application for reinstatement, stating that he was "very sorry

as to what happened with [his] health license"; "that he had used [his] position with Aflac and

[his] [h]ealth insurance license to malrn some bad choices which have never happened before this

ORDER GRANTING THE OIC'S MOTION FOR SUMMARY JUDGMENT No. 18-0150 Page2

and never happened since"; and requesting that the OIC "let [him] have a chance to hold at least

a Life License. All [he] ask[s] is for a bit of mercy." (Brackets added). Mr. Murphy never filed

a response to the OIC's Motion.

Summary Judgment Standard.

WAC 10-08-135,1 which governs motions for summary judgment in administrative

proceedings, provides:

A motion for summary judgment may be granted and an order issued if the written record shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter oflaw.

In ruling on a motion for summary judgment the court must consider the material

evidence and all reasonable inferences therefrom most favorably for the nonmoving party; and

when so considered, if reasonable people might reach different conclusions, the motion should

be denied. Jacobsen v. State, 89 Wn.2d 104, 108-109, 569 P.2d 1152 (1977). See also Fleming

v. Stoddard Wendie Motor Co., 70 Wn.2d 465, 467, 423 P.2d 926 (1967). However, factual

issues may be decided on summary judgment "when reasonable minds could reach but one

conclusion from the evidence presented." Lane v. Harborview Med. Ctr., 154 Wn. App. 279,

288, 227 P.3d 297 (2010)(citing Van Dinter v. City ofKennewick, 121 Wn.2d 38, 47, 846 P.2d

522 (1993)). While the moving party bears t11e initial burden of establishing its right to judgment

as a matter of law, once the moving party satisfies its initial burden, the burden then shifts to the

nonmoving party to show iliat a triable issue exists. Hartford Ins. Co. v. Ohio Cas. Ins. Co., 145

1 As case law explains, while the Administrative Procedure Act (RCW Ch. 34.05) does not contain any provisions authorizing agencies to grant summary judgment, a legislatively created agency or board, wben acting in a quasijudicial capacity, may employ summary procedure if there is no genuine issue of material fact. Eastlake Cmty. Council v. Seattle, 64 Wn. App. 273, 276, 823 P.2d 1132 ("Thus the Board was within its power to grant an order of summary judgment.")(Citing Asarco, Inc. v. Air Quality Coal., 92 Wn.2d 685, 697, 601 P.2d 50 I (1979)); Pierce Cty. v. State, 144 Wn. App. 783, 804, 185 P.3d 594 (2008); Verizon Northwest, Inc. v. Emp'tSec. Dep't, 164 Wn.2d 909, 915-916, 194 P.3d 255 (2008).

ORDER GRANTING THE OIC'S MOTION FOR SUMMARY JUDGMENT No. 18-0150 Page 3

Wn. App. 765, 772, 189 P.3d 195 (2008)(citing Jacob's Meadow Owners Ass'n v. Plateau, 44 JI,

LLC, 139 Wn. App. 743, 752 n.1, 162 P.3d 1153 (2007)).

Since Michael Murphy is the nonmoving party when considering the OIC's Motion, I

have considered material evidence in the record in the manner most favorable to the nonmoving

party in each instance. I do note, however, that the OIC has met its initial burden by establishing

its right to judgment as a matter of law, thereby shifting the burden to Mr. Murphy to show a

triable issue exists. For the reasons set forth below, since reasonable persons can only reach one

conclusion given the evidence, and because Mr. Murphy has not met its burden of showing that a

triable issues exists (i.e., did not file a response), I grant the OIC's Motion.

Analysis.

1. Whether the collateral estoppel doctrine, or issue preclusion, bars Michael Murphy from relitigating whether he violated RCW 48.l 7.530(1)(g), (l)(h) and (l)(i) because in the Final Order the undersigned held that Mr. Murphy did and revoked his insurance producer license.

"Collateral estoppel, or issue preclusion, bars relitigation of an issue in a subsequent

proceeding involving the same parties. 14A KARL B. TEGLAND, WASHING TON

PRACTICE: CIVIL PROCEDURE § 35.32, at 475 (1st ed. 2003)." Christensen v. Grant Cty.

Hosp. Dist. No. i, 152 Wn.2d 299, 306, 96 P.3d 957 (2004). Collateral estoppel is distinguished

from claim preclusion "in that, instead of preventing a second assertion of the same claim or

cause of action, it prevents a second litigation of issues between the parties, even though a

different claim or cause of action is asserted." id. (Citations omitted). The collateral estoppel

doctrine promotes judicial economy and serves to prevent inconvenience or harassment of

parties. id. Collateral estoppel may be applied to preclude only those issues that have actually

been litigated and necessarily determined in the earlier proceeding. Id. (Citations omitted). As

ORDER GRANTING THE OIC'S MOTION FOR SUMMARY WDGMENT No. 18-0150 Page 4

the Court explains in Christensen, certain requirements must be met for collateral estoppel to

apply to adjudicative proceedings before govermnent agencies (including the OIC), and states:

For collateral estoppel to apply, the party seeking application of the doctrine must establish that (!) the issue decided in the earlier proceeding was identical to the issue presented in the later proceeding; (2) the earlier proceeding ended in a judgment on the merits; (3) the party against whom collateral estoppel is asserted was a party to, or in privily with a party to, the earlier proceeding; and (4) application of collateral estoppel does not work an injustice on the party against whom it is applied. Reninger, 134 Wn.2d at 449; State v. Williams, 132 Wn.2d 248, 254, 937 P.2d 1052 (1997); Trautman, Claim and Issue Preclusion, 60 WASH. L. REV. at 831.

[6] Both state and federal courts have applied collateral estoppel where an issue was adjudicated by an administrative agency in the earlier proceeding. E.g., Univ. of Tenn. v. Elliott, 478 U.S. 788, 106 S. Ct. 3220, 92 L. Ed. 2d 635 (1986); Miller v. County ofSanta Cruz, 39 F.3d 1030 (9th Cir. 1994); Reninger, 134 Wn.2d 437; Shoemaker, 109 Wn.2d 504; Luisi Truck Lines, 72 Wn.2d 887; see Trautman, Claim and Issue Preclusion, 60 WASH. L. REV. at 830. The United States Supreme Court has applied issue preclusion to enforce repose where an administrative agency has acted in a judicial capacity and resolved disputed issues of fact:

Such repose is justified on the sound and obvious principle of judicial policy that a losing litigant deserves no rematch after a· defeat fairly suffered, in adversarial proceedings, on an issue identical in substance to the one he subsequently seeks to raise. To hold otherwise would, as a general matter, impose unjustifiably upon those who have already shouldered their burdens, and drain the resources of an adjudicatory system with disputes resisting resolution.

Astoria Fed. Sav. & LoanAss'n v. Solimino, 501U.S.104, 107-08, 111 S. Ct. 2166, 115 L. Ed. 2d 96 (1991). Three additional factors must be considered under Washington law before collateral estoppel may be applied to agency findings: (!)whether the agency acted within its competence, (2) the differences between procedures in the administrative proceeding and court procedures, and (3) public policy considerations. Reninger, 134 Wn.2d at 450; Shoemaker, 109 Wn.2d at 508; State v. Dupard, 93 Wn.2d 268, 275, 609 P.2d 961 (1980).

Christensen, 152 Wn.2d at 307-08 (emphasis added).2

In the Final Order, after considering the evidence in the record, I held that Michael

2 Collateral estoppel, or issue preclusion, applies to quasi-judicial administrative agency decisions. Clallam Cty. v. Hearings Bd., 130 Wn. App. 127, 132, 121 P.3d 764 (2005).


Murphy violated RCW 48.17.530(l)(g) (by virtue of his violation of RCW 48.30.210), RCW

48.17.530(l)(h) and RCW 48.17.530(l)G). As to element (1) above in Christensen, whether Mr.

Murphy violated RCW 48.17.530(1) is also an issue in this proceeding addressing whether his

insurance producer license should be reinstated. With regards to element (2), the Final Order

ended in a judgment on the merits. As to element (3), Mr. Murphy was a party in the

adjudicative proceeding before the Office of Administrative Hearings and the OIC that resulted

in the Final Order. With respect to element (4), there is no injustice here if collateral estoppel is

applied to Mr. Murphy since the primary issue before us, like in the Final Order, is whether Mr.

Murphy previously violated RCW 48.17.530(1).

As to the additional requirements set forth above in Christensen concerning applying

collateral estoppel to agency findings, with respect to the first additional element, the ore clearly

acted within its competence in issuing the Final Order. As to the second additional element, Mr.

Murphy never filed a petition for judicial review of the Final Order within thirty days after

service of the same, as he was entitled to per RCW 34.05.542(3). If Mr. Murphy had filed a

petition for judicial review tl1at would have provided him with the opportunity to have a superior

court review the Final Order per the criteria in RCW 34.05.570(3). That did not occur. As to the

third and final element, neither party identifies any public policy considerations that would

prevent collateral estoppel from applying in this case. Rather, the Final Order is supported by

the overarching statutory policy that those engaged in the insurance industry maintain the highest

standards; and where they do not, the Commissioner is duty bound to enforce the provisions of

the insurance code (i.e., RCW Title 48) by taking action against bad actors. 3 As RCW

3 RCW 48.01.010 states: "Title 48 RCW constitutes the insurance code."


48.01.030 explains:

The business of insurance is one affected by the public interest, requiring that all persons be actuated by good faith, abstain from deception, and practice honesty and equity in all insurance matters. Upon the insurer, the insured, their providers, and their representatives rests the duty of preserving inviolate the integrity of insurance.

In addition, RCW 48.02.060 outlines in general the authority and responsibilities of the

Commissioner, including the following:

(1) The commissioner has the authority expressly conferred upon him or her by or reasonably implied from the provisions of this code. (2) The commissioner must execute his or her duties and must enforce the provisions of this code [RCW Title 48].

(Emphasis and brackets added).

Since the elements in Christensen have been satisfied, the collateral estoppel doctrine, or

JSsue preclusion, bars Michael Murphy from relitigating whether he violated RCW

48.17.530(1 )(g), (1 )(h) and (1 )G) because in the Final Order I held that Mr. Murphy did and

revoked his insurance producer license, which he never petitioned a superior court to review.

This holding triggers consequences under RCW 48.17.090(2) which prohibits me from granting

Mr. Murphy's application for an insurance producer license which I now address.

2. Whether pursuant to RCW 48.17.090(2) and RCW 48.17.530(1) the undersigned must denv Mr. Murphv's application for reinstatement ofhis insurance producer license.

RCW 48.17.060(1) states: "A person shall not sell, solicit, or negotiate insurance in this

state for any line or lines of insurance unless the person is licensed4 for that line of authority in

4 RCW 48.17.010(8) defines the term "license" as: [A] document issued by the commissioner authorizing a person to act as an insurance producer or title insurance agent for the lines of authority specified in the document. The license itself does not create any authority, actual, apparent, or inherent, in the holder to represent or commit to an insurer.

(Brackets added).


accordance with this chapter." 5 (Emphasis added).

RCW 48.17.090 addresses applications for resident insurance producer licenses and

explains what must be included in such applications, and what the commissioner must review

before approving such an application, and states in part: 6

(1) An individual applying for a resident insurance producer license shall make application to the commissioner on the uniform application and declare under penalty of refusal, suspension, or revocation of the license that the statements made in the application are true, correct, and complete to the best of the individual's knowledge and belief. As a part of or in connection with the application, the individual applicant shall furnish information concerning the applicant's identity, including fingerprints for submission to the Washington state patrol, the federal bureau of investigation, and any governmental agency or entity authorized to receive this information for a state and national criminal history background check. If, in the process of verifying fingerprints, business records, or other information, the commissioner's office incurs fees or charges from another governmental agency or from a business firm, the amount of the fees or charges shall be paid to the commissioner's office by the applicant. (2) Before approving the application, the commissioner shall find that the individual: (a) Is at least eighteen years of age; (b) Has not committed any act that is a ground for denial, suspension, or revocation set forth in RCW 48.17.530; (c) Has completed a prelicensing course of study for the lines of authority for which the person has applied; (d) Has paid the fees set forth in RCW 48.14.010; and (e) Has successfully passed the examinations for the lines of authority for which the person has applied.

5 RCW 48.17.010(8) defines "license" as a document issued by the Commissioner authol'izing a person to act as an insurance producer or title insurance agent for the lines of authority specified in the document. The license itself does not create any authority, actual, apparent, or inherent, in the holder to represent or commit to an insurer. Id 6 RCW 48.17.170(7) addresses "reinstatement" of insurance producer licenses, and states:

If the request for renewal of an insurance producer's, title insurance agent's, or adjuster's license and fee for tl1e renewal are received by the commissioner after sixty days but prior to twelve months after the expiration date, the application is for reinstatement of the license and the applicant for reinstatement must pay to the commissioner the license fee and a surcharge of two hundred percent of the license fee.

While technically within the one year window after his license was revoked, Mr. Murphy's application for an insurance producer license is not quite a request for renewal. The Final Order revoked Mr. Murphy's license, thereby preventing it from being the subject of any renewal. That said, consistent with the OlC's initial denial, I have framed the issue as whether Mr. Murphy's application for reinstatement should be denied, and will not depart from that. In either case, the relevant legal analysis still involves both RCW 48.17.090(1) and RCW 48.17.530(1).

ORDER GRANTING TI-IE OIC'S MOTION FOR SUMMARY JUDGMENT No. 18-0150 Page 8

(Emphasis added). See also WAC 284-17-120(3) ("The commissioner will review the

application and if all reqnirements have been met will issue the license(s)").

The word "shall" in a statute is presumptively imperative, operates to create a duty, and

imposes a mandatory requirement unless a contrary legislative intent is apparent. State v.

Martin, 137 Wn.2d 149, 154, 969 P.2d 450 (1999). As the Court states in Planned Parenthood

of the Great Northwest v. Bloedow, 187 Wn. App. 606, 622, 350 P.3d 660 (2015): "The use of

the word "shall" [in RCW 48.17.090(2)] is a mandatory directive." (Brackets added).

The Final Bill Report for SSB 5715 ("Bill"), filed on April 18, 2007, and effective July 1,

2009, the passage of which paved the way for the current language in RCW 48.17.090(2), states:

"The National Association of Insurance Commissioners (NAIC) has developed a model called

producer licensing. This model has been adopted by 38 states."7 The House Bill Report for the

Bill clarifies that under RCW 48.17.090(2), in order to obtain a producer license, an applicant:

... [M]ust meet the following requirements:

• be at least 18 years old; • not commit any act that is a ground for denial, suspension, or revocation of a

license; • complete pre-licensing study for the line of authority applied for; and • pay applicable fees; • pass examinations for the lines of authority applied for.

(Emphasis added).

The word "shall," as used in RCW 48.17.090(2), and as the legislative history of the Bill

demonstrates, mandates that prior to approving an application, the Commissioner must find that

7 The NAlC model law the legislative history refers to is the so-called "Producer Licensing Model Act," or Model Law 218, adopted by the NAJC h1 2005. Model Law 218 mirrors the structure (and some of the verbiage) of the relevant portions of the language in RCW 48.17.090 and RCW 48.17.530.


the applicant has not committed any act which is grounds for denying his or her application per

RCW 48.17.530. The applicant must meet this requirement in order to obtain a license. RCW

48.17 .530 states in part:

(1) The commissioner may ... refuse to issue... an insurance producer's license ... for any one or more of the following causes:

(a) Providing incorrect, misleading, incomplete, or materially untrue information in the license application;

(b) Violating any insurance laws, or violating any rule, subpoena, or order of the commissioner or of another state's insurance commissioner;

(c) Obtaining or attempting to obtain a license through misrepresentation or fraud; (d) Improperly withholding, misappropriating, or converting any moneys or

properties received in the course of doing insurance business; (e) Intentionally misrepresenting the terms of an actual or proposed insurance

contract or application for insurance; (f) Having been convicted of a felony; (g) Having admitted or been found to have committed any insurance unfair trade

practice or fraud; (h) Using fraudulent, coercive, or dishonest practices, or demonstrating

incompetence, untrustworthiness, or financial irresponsibility in this state or elsewhere; (i) Having an insurance producer license, or its equivalent, denied, suspended, or

revoked in any other state, province, district, or territory; (j) Forging another's name to an application for insurm1ce or to any document related

to m1 insurance transaction; (k) Improperly using notes or any other reference material to complete an

exmnination for an insurance license; (I) Knowingly accepting insurance business from a person who is required to be

licensed under this title and is not so licensed, other than orders for issuance of title insurance on property located in this state placed by a nonresident title insurance agent authorized to act as a title insurance agent in the title insurance agent's home state; or

(m) Obtaining a loan from an insurance client that is not a financial institution and who is not related to the insurance producer by birth, marriage, or adoption, except the commissioner may, by rule, define and permit reasonable arrangements.

(Emphasis added).

The ordinary meaning of the word "may" in a statute conveys the idea of choice or

discretion. Strenge v. Clarke, 89 Wn.2d 23, 28, 569 P.2d 60 (1977)(citing State ex rel. Beck v.

Carter, 2 Wn. App. 974, 977, 471 P.2d 127 (1970)). The word "may" in a statute has a


permissive or discretionary meaning, and does not create a duty to do a particular act. National

Electrical Contractors Assn. v. Rive/and, 138 Wn.2d 9, 28, 978 P.2d 481 (1999)(citing Yakima

County (W Valley) Fire Protection Dist. No. 12 v. City of Yakima, 122 Wn.2d 371, 381, 858

P.2d 245 (1993)).

Unlike under RCW 48.17.090(2), the use of the word "may" in RCW 48.17.530(1) gives

the Commissioner discretion to refuse an application for an insurance producer license for any of

the reasons articulated therein, including an applicant found to have committed any insurance

unfair trade practice or fraud; using fraudulent, coercive, or dishonest practices, or demonstrating

incompetence, untrustworthiness, or financial irresponsibility in this state or elsewhere; or

forging another's name to an application for insurance or to any docun1ent related to an insurance

transaction. However, RCW 48.17.530(1) does not concern the Commissioner's approval of an

application for an insurance producer license, and the requirements for doing so, since RCW

48.17.090(2) directly addresses that. The rules of statutory construction demonstrate that while

at first blush RCW 48.17.090(2) and RCW 48.17.530(1) appear to conflict with each other, in

that the former is mandatory and the latter discretionary, the two provisions can be read together

in a manner that renders them complementary to one another.

The rules of statutory construction require that when possible the various provisions of an

act be harmonized; this usually arises within particular statutory chapters. Stale v. Williams, 62

Wn. App. 336, 338, 813 P .2d 1293 (1991 ). Statutes that concern the same subject matter, in pari

materia, should be construed "as constituting one law to the end that a harmonious total schema

which maintains the integrity of both is derived." Beach v. Bd. ofAdjustment, 73 Wn.2d 343,

346, 438 P.2d 617 (1968); State v. Houck, 32 Wn.2d 681, 684, 203 P.2d 693 (1949). In seeking

ORDER GRANTING TI-IE OIC'S MOTION FOR SUMMARY JUDGMENT No. 18-0150 Page 11

to harmonize provisions of a statute, statutes relating to the same subject must be read as

complementary instead of in conflict with each other. State v. Chapman, 140 Wn.2d 436, 448,

998 P.2d 282 (2000). In addition, I must interpret and constrne statutes so that all the language

used is given effect, with no portion rendered meaningless or superfluous. G-P Gypsum Corp. v.

Dep 't ofRevenue, 169 Wn.2d 304, 309, 237 P.3d 256 (2010).

RCW 48.01.150 states: "Provisions of [RCW Title 48] relating to a particular kind of

insurance or a particular type of insurer or to a particular matter prevail over provisions relating

to insurance in general or insurers in general or to such matter in general." (Emphasis and

brackets added). In Gomez v. Life Ins. Co. ofNorth America, 84 Wn. App. 562, 567, 928 P.2d

1153 (1997), the Court echoes this sentiment and emphasizes that a more specific provision of

the insurance code (RCW Title 48) controls over a more general provision, and states in part:

The structure of our insurance code indicates that the Legislature intended to treat life insurance and disability insurance separately. "'[S]tatutes must be read together to determine legislative purpose to achieve a "harmonious total statutory scheme ... which !'naintains the integrity of the respective statutes.'"" Under the insurance code, a more specific provision of the code controls over a general.

(Emphasis added).

"Where a general statute includes the same matter as a specific statute and the two cannot

be harmonized, the specific statute will prevail over the general." AOL, LLC v. Dep 't of

Revenue, 149 Wn. App. 533, 542, 205 P.3d 159 (2009)(citing Residents Opposed to Kittitas

Turbines v. State Energy Facility Site Evaluation Council, 165 Wn.2d 275, 309, 197 P.3d 1153

(2008)).

RCW 48.17.090(2) is the provision of the insurance code, and in particular RCW Chapter

48.17, that specifically addresses the Commissioner's approval of an application for an insurance


producer's license. This provision requires that prior to approving an application, the

Commissioner must find that the applicant has not committed any act that is a ground for denial,

suspension, or revocation set forth in RCW 48.17.530. If an applicant has committed any of the

acts in RCW 48.17.530(1) which are grounds for the Commissioner denying an insurance

producer application, then the Commissioner cannot approve that application under RCW

48.17.090(2). To reiterate, the latter is not a discretionary provision. On the other hand, RCW

48.17 .530(1) lists out numerous bases for the Commissioner to refuse an application for an

insurance producer license, from which the Commissioner may choose. However, RCW

48.17.530(1) does not trump the mandatory nature of RCW 48.17.090(2), or permit the

Commissioner to approve an application of someone who has violated any of the provisions of

RCW 48.17.530(1). For me to rule otherwise, would render the language in RCW 48.17.090(2)

meaningless and superfluous.

A proper reading of both RCW 48.17.090(2) and RCW 48.17.530(1) is possible which

renders them complementary and harmonious, and preserves the integrity of both statutes. RCW

48.17.530(1) sets out causes, any of which the Commissioner may cite as the basis for denying a

resident insurance producer application. Amongst the alternatives in RCW 48.17.530(1), the

Commissioner maintains discretion to choose one or more of the appropriate grounds for

denying an application. That said, RCW 48.17.090 sets forth the mandatory rule that if the

Commissioner decides to approve an application for a resident insurance producer license, he

must find, and the applicant must demonstrate, that the applicant has not committed any act

tmder RCW 48.17.530(1) for which the Commissioner may deny his or her application.


As I explain above the collateral estoppel doctrine, or issue preclusion, prevents Michael

Murphy from relitigating the issues decided in the Final Order, including that Mr. Murphy

violated RCW 48.l 7.530(1)(g), (l)(h) and (l)Q). As such, under RCW 48.17.090(2), I deny Mr.

Murphy's application for reinstatement of his insurance producer license.

Ruling.

The OIC's Motion for Summary Judgment is granted, and accordingly the hearing

scheduled for August 2, 2018 is hereby stricken. Michael Murphy's March 22, 2018 application

for reinstatement of his insurance producer license is denied.

William G. Pardee Presiding Officer

Pursuant to RCW 34.05.461(3), the parties are advised that they may seek reconsideration of this order by filing a request for reconsideration under RCW 34.05.470 with the undersigned within 10 days of the date of service (date of mailing) of this order. Further, the parties are advised that, pursuant to RCW 34.05.514 and 34.05.542, this order may be appealed to Superior Court by, within 30 days after date of service (date of mailing) of this order, 1) filing a petition in the Superior Court, at the petitioner's option, for (a) Thurston County or (b) the county of the petitioner's residence or principal place of business; and 2) delivery of a copy of the petition to the Office of the Insmance Commissioner; and 3) depositing copies of the petition upon all other parties of record and the Office of the Attorney General.


CERTIFICATE OF SERVICE

The undersigned certifies under the penalty of perjury under the laws of the state of

Washington that I am now and at all times herein mentioned, a citizen of the United States, a

resident of the state of Washington, over the age of eighteen years, not a party to or interested

in the above-entitled action, and competent to be a witness herein.

On the date given below I caused to be filed and served the foregoing Order Granting

the OIC's Motion for Summary Judgment on the following people at their addresses listed

below:

Michael Murphy 1035 S. McMillan Ct. Spokane Valley, WA 99016

Mike Kreidler, Insurance Commissioner James T. Odiorne, J.D., CPA, Chief Deputy Insurance Commissioner Melanie Anderson, Deputy Commissioner, Consumer Protection Division Jeff Baughman, Licensing & Education Manager, Consumer Protection Division Toni Hood, Deputy Commissioner, Legal Affairs Division Darryl Colman, Insurance Enforcement Specialist, Legal Affairs Division Office of the Insurance Commissioner PO Box 40255 Olympia, WA 98504-0255

Dated this 3rd day of July, 2018, in Tumwater, Washington.

ne-Taylor


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OFFICE OF INSUHANCE COMMISSIONER - Wa