Opinion
No. 05-0074-E.
October 13, 2005.
MEMORANDUM OF DECISION AND ORDER ON THE DEFENDANTS' MOTION TO DISMISS
INTRODUCTION
The plaintiffs, Angel Cain, Danielle Romain, Ana Montero, Mary Romano, Sarah Lesane and the Massachusetts Coalition for the Homeless (collectively "the plaintiffs"), brought this action challenging the defendants', Department of Transitional Assistance (the "Department") and John Wagner, Commissioner of the Department, administration of the Transitional Aid for Families with Dependent Children (TAFDC) program. The plaintiffs seek declaratory relief under G.L. c. 231A establishing as unlawful the defendants' sanctioning policies, procedures and regulations for noncompliance with the work requirements of the TAFDC program. The defendants now move to dismiss the plaintiffs' complaint pursuant to Mass. R. Civ. P. 12(b)(1) and 12(b)(6). In support of its motion, the defendants contend the court lacks jurisdiction over the plaintiffs' action for declaratory judgment because the plaintiffs failed to exhaust their administrative remedies. In opposition to the defendants' motion, the plaintiffs assert that they have met the prerequisites for declaratory judgment and that exhaustion of the administrative remedies would prove futile in this case. For the reasons discussed hereinafter, the defendants' motion to dismiss is ALLOWED.
BACKGROUND
The TAFDC program provides financial assistance to low income parents with dependent children while they transition from welfare to work. As part of the program, TAFDC recipients who have received assistance for sixty days are required to work twenty to thirty hours per week. TAFDC recipients may meet this work requirement by, among other options, working in a paid job, participating in a community service program to which the Department must provide a referral and suitable placement, participating in an education or training activity, or working full-time in a position in a Department-sponsored employment program.
To assist TAFDC recipients in the fulfillment of their obligations under the TAFDC work requirement, the DTA may set up an employment development plan (EDP) for individual recipients with the involvement of that particular recipient. If a TAFDC recipient fails to meet the requirements of his or her EDP or the basic requirements of the work program, he or she is subject to a series of progressive sanctions, which may ultimately result in the termination of assistance to the recipient.
Prior to such sanctioning, the Department must determine whether a recipient has "good cause" for his or her non-compliance with the work program requirements or the terms of an EDP. In so doing, the Department must review all good cause criteria with the recipient to determine whether good cause in fact exists. If it is determined that the recipient's failure to meet these requirements is without "good cause," the Department implements the sanctioning process.
If the Department acts to sanction a TAFDC recipient, it is required to provide the recipient with "adequate" written notice of the intended action. The notice is adequate if it is timely and contains therein the reasons for the action as well as a detailed explanation of the recipient's right to a hearing. A recipient must request a hearing from the Department's Division of Hearings (the "Division") within ninety days from the date of the notice of the intended action. If this request is received by the Division within the applicable time period, a TAFDC recipient is entitled to continued assistance until an appeal decision is rendered.
At varying points in time, the plaintiffs were subject to the Department's sanctioning procedures for noncompliance with the requirements of the work program or the terms of an EDP. In each case, the plaintiffs' were notified of the Department's intended action to reduce or terminate TAFDC as well as their right to appeal such action. None of the plaintiffs appealed the Department's actions except for Ms. Romain, whose appeal was dismissed for failure to appear at the hearing. As a result, the Department ultimately terminated the plaintiffs' assistance and, as further sanction, the plaintiffs' families TAFDC benefits. The plaintiffs were eventually able to reapply for TAFDC and all currently receive TAFDC benefits.
Prior to actual termination of the plaintiffs' TAFDC assistance, the Department did not proactively determine whether the plaintiffs had good cause for failing to comply with the requirements of the work program or an EDP. Nor did the Department ensure the plaintiffs were placed with a tenable community service site or other program in which the plaintiffs could fulfill their work program or EDP obligations.
The plaintiffs filed the instant action on January 10, 2005, seeking declaratory relief under G.L. c. 231A. In essence, the plaintiffs request a declaratory judgment that the Department's sanctioning policies, procedures and regulations are unlawful and, in turn, that the court order that the Department change these policies, procedures, regulations and pay each of the plaintiffs, as well as other yet unnamed TAFDC recipients, any lost benefits resulting from the Department's wrongful sanctioning process.
DISCUSSION
I. Plaintiffs' Request for Declaratory Judgment
For the court to entertain a request for declaratory judgment pursuant to G.L. c. 231A in a case involving administrative action, it must be apparent from the pleadings that: (1) an actual controversy exists; (2) the plaintiffs possesses legal standing; (3) all necessary parties have been joined; and (4) all available administrative remedies have been exhausted. Villages Dev. Co. v. Sec'y of the Executive Office of Envtl. Affairs, 410 Mass. 100,106 (1991). The plaintiffs in this case have failed to allege sufficient facts, even if taken as true, that demonstrate the necessary prerequisites for the court to exercise jurisdiction over the plaintiffs' action for declaratory judgment under G.L. c. 231A.
A. Actual Controversy
A declaratory judgment involves the resolution of "real, not hypothetical controversies; the declaration issued is intended to have an immediate impact on the rights of the parties." Mass. Ass'n of Indep. Ins. Agents Brokers, Inc. v. Comm'r of Ins., 373 Mass. 290, 293 (1977). To prove the existence of an actual controversy within the meaning of G.L. c. 231A, § 1, the plaintiffs must allege facts that show a "real dispute caused by one party's assertion of a legal relation, status or right in which he has a definite interest" and an opposing party's denial of that assertion where "the circumstances of the dispute plainly indicate that unless the matter is adjusted such antagonistic claims will almost immediately and inevitably lead to litigation." School Comm. of Cambridge v. Superintendent of Schools, 230 Mass. 516, 518 (1946). The plaintiffs argue that an actual controversy exists between the parties for which declaratory relief is appropriate insofar as the sanctioning policies of the Department have harmed the plaintiffs in the past and will continue to harm the plaintiffs in the future as well as other TAFDC recipients. However, the plaintiffs' failure to appeal the termination of their TAFDC benefits through the available administrative channels forecloses the existence of an actual controversy between the parties to this complaint.
An actual controversy does not arise where, as in this case, a person with an alleged adverse interest, although given the opportunity, declines to act to vindicate this interest and, as a result, surrenders the right to do so. Stop Shop Companies v. Board of Registration in Pharmacy, 394 Mass. 1008, 1008-09 (1985); Board of Appeals of Rockport v. DeCarolis, et al., 32 Mass. App. Ct. 348, 353 (1992) (stating that "declaratory relief cannot be used to circumvent a period prescribed by statute for obtaining judicial review"). Although the plaintiffs' benefits were at one time terminated by the Department, they neither appealed the termination nor, in one case, followed through with the administrative appeal process as provided by statute to challenge the termination of their TAFDC assistance. Furthermore, the plaintiffs are no longer able to appeal because the time for such an appeal has expired. Accordingly, none of the plaintiffs actively contested the Department's actions and, at the time this complaint was filed, no agency proceedings involving the plaintiffs were pending in which entitlement to the lost TAFDC benefits was the object of dispute. Samuels Pharmacy Inc. v. Board of Registration in Pharmacy, 390 Mass. 583, 591-92 (1983). Therefore, a declaratory judgment in this case would not further the resolution of an existing controversy for which the requested relief would directly and immediately affect the rights of the parties as to the terminated benefits. J J Enterprises, Inc., et al. v. Martignetti, et al., 369 Mass. 535, 539 (1976).
The plaintiffs do not dispute the expiration of the regulatory time limit to appeal the termination of their TAFDC benefits.
The plaintiffs argue in their Supplemental Memorandum in Opposition to the Defendants' Motion to Dismiss that the facts of this case present a live controversy because, contingent upon the court declaring unlawful the challenged DTA regulations and policies, the plaintiffs would be entitled to corrective action for any underpayment of TAFDC assistance pursuant to 106 C.M.R. § 706.210. In support of their argument, the plaintiffs rely on the Supreme Judicial Court's decision in Crane v. Comm'r of Public Welfare, 395 Mass. 435 (1985) and on Minnefield v. McIntire, Civil No. 3349 (Suffolk Super. Ct. February 14, 200) (Gants, J.). However, the plaintiffs' reliance on these cases is misplaced. In both cases, the courts reasoned that prior decisions determining an agency regulation illegal provided an appropriate basis upon which the plaintiffs could seek monetary relief in an action in this court in the form of correction of an underpayment of benefits in spite of the fact the plaintiffs' right to administratively challenge the underpayment was time-barred. This circumstance is not present in this case. There has been no prior decision rendering the challenged regulations illegal upon which the plaintiffs can rely to resurrect their administratively expired claims. Moreover, absent such a decision or declaration, neither case indicates that the court should proceed directly to the merits of the plaintiffs' claims when such claims have not been challenged by a timely appeal required by the administrative process.
In addition, the plaintiffs propose that the court make a declaration capable of affecting potential future controversies, which, although they may arise, necessarily may not occur. This proposition does not concern a matter of sufficient immediacy and practical certainty to merit declaratory judgment. Machado v. Leahy, Civil No. 0514 (Bristol Super. Ct. January 3, 2004) (Kane, J.). Consequently, there is no actual controversy between the parties apparent from the pleadings; but, rather, allegations concerning controversies and conflicts that may possibly arise in the future, which is not of the kind contemplated by G.L. c. 231A, § 1 over which the court may exercise its jurisdiction.
B. Standing
The question of whether an actual controversy exists is closely related to the issue of standing, but the two concepts are distinct. Mass. Ass'n of Indep. Ins. Agents Brokers, Inc, 373 Mass. at 292. To have standing to secure declaratory relief, the plaintiffs must demonstrate by way of specific factual allegations that, by virtue of a legally cognizable injury, they have a direct personal interest in the judicial resolution of the alleged controversy. Mass. Ass'n of Indep. Ins. Agents Brokers, Inc, 373 Mass. at 293. The plaintiffs have not met this requirement for declaratory relief.
As discussed earlier, the plaintiffs did not appeal the termination of their TAFDC benefits through the available administrative process and may no longer do so. As a result, because of their inaction, the plaintiffs conceded the loss of their benefits for that period and their right to establish entitlement thereto from the Department or in this court.
The plaintiffs, after the fact, cannot now allege that they suffered an actual injury or loss to a protected right or interest as a result of the wrongful imposition of a Department sanction where they previously failed to assert such harm. Nor have the plaintiffs sufficiently demonstrated that they are in impending danger of suffering such injury. The plaintiffs allege only future potential injury. Therefore, the outcome of the controversy would not directly and immediately affect the plaintiffs as to a definite personal interest. Warth v. Seldin, 422 U.S. 490, 498, (1975). However, this is not to say that the plaintiffs have no interest in the controversy; but, rather, their interest is general in nature.
The plaintiffs seek to alter the sanctioning policies and regulations associated with the TAFDC program work requirement on behalf of all past, present and future TAFDC recipients who have been or may be impacted by such policies and regulations. Nevertheless, the plaintiffs cannot rest their claims to relief on the rights of TAFDC recipients in general. Therefore, in light of the fact that the plaintiffs' lack a practical stake in the outcome of the controversy, the plaintiffs' interest in protecting the rights of all TAFDC recipients is not sufficiently definite to confer standing in this case. Bonan v. Boston, 398 Mass. 315, 320 (1986) (standing requires a definite interest in the matters in contention inasmuch as the plaintiff's rights will be significantly and immediately affected by the resolution of the contested point). Consequently, the facts as alleged in the pleadings do not proffer an adequate basis upon which standing may be found to obtain declaratory relief from this court. Enos v. Sec'y of Env't Affairs, 432 Mass. 132, 135 (2000) (G.L. c. 231A § 1 does not provide an independent basis for standing).
The court need not address the plaintiffs' sixth claim and the defendants' opposition thereto because the plaintiffs lack the requisite standing to bring suit under G.L. c. 231A.
C. Exhaustion of Administrative Remedies
It is well-established in the Commonwealth that a plaintiff seeking a declaratory judgment must first exhaust all available administrative remedies. Space Building Corp. v. Comm'r of Revenue, 413 Mass. 445, 448 (1992); East Chop Tennis Club v. Mass. Comm'n Against Discrimination, 364 Mass. 444, 450 (1973). The rationale underlying the exhaustion doctrine is to preserve the integrity of the administrative process while sparing the judiciary the burden of reviewing administrative proceedings in piecemeal fashion. Assuncao's Case, 372 Mass. 6, 9 (1977). However, because no administrative proceedings are pending in this case, the issue is more correctly one of "primary jurisdiction." Nevertheless, the purpose behind the primary jurisdiction doctrine is the same as that which underpins the exhaustion doctrine. Murphy, et al. v. Adm'r of the Div. of Pers. Admin., 377 Mass. 217, 221 (1978).
By requesting a declaratory judgment, the plaintiffs' ask this court to take the first pass on the issues raised in the complaint. However, the court will not allow the plaintiffs to bypass the proper administrative course merely because the present action is styled as one for declaratory judgment. East Chop Tennis Club, 364 Mass. at 450-51 (an action for declaratory relief is not a surrogate for the administrative process).
Where an administrative process is available to deal with issues within the ambit of an agency in the first instance, the courts must respect this process to avoid subverting the authority of the agency to determine such issues and, in turn, disrupting the ordinary administrative process. Wilczewski, et al. v. Comm'r of the Dept. of Env't Quality Eng'g, et al., 404 Mass. 787, 792 (1989); Nelson v. Blue Shield of Mass., Inc., 377 Mass. 746, 753 (1979). In this case, the relevant Department regulation makes available "exclusive" procedures governing the appeal of the termination, reduction or suspension of TAFDC assistance. 106 C.M.R. §§ 343.250, 343.040. This process affords TAFDC recipients and their representatives an on-the-record forum within the Department to present evidence and legal arguments, after consideration of which a hearing officer renders a final decision reflecting his or her findings and conclusions.106 C.M.R. §§ 343.610, 343.620. If "dissatisfied" with this decision, a recipient may file a complaint in this court challenging the propriety of the hearing officer's decision pursuant to G.L. 30A, § 14. 106 C.M.R. § 343.720. According to this administrative scheme, the Department is entrusted with the first opportunity to consider matters that fall within its regulatory purview, including agency action to reduce or terminate financial assistance. The plaintiffs' right to judicial review remains for the end of the administrative appeal process.
The plaintiffs contend, however, that they were not required to avail themselves of the administrative appeal process because resort to such proceedings would prove futile and unnecessary. Nevertheless, where available administrative proceedings may afford some relief, or may affect the scope of judicial relief, such means should be utilized prior to an independent action in the courts. Nelson, 377 Mass. at 752. This principle applies even when administrative relief is no longer available due to the failure to seek such relief within the period of time set by statute. Gallo v. Div. of Water Pollution Control, 374 Mass. 278, 288-89 (1978).
The plaintiffs cannot escape the fact their complaint, in part, seeks relief in the form of reimbursement for the alleged wrongful termination of their TAFDC benefits, which is a question that the Department is equipped to resolve through its appeal process. Accordingly, had the plaintiffs appealed to the Division and a violation found, it would have been within the authority of the Division to order the Department to officially reinstate the plaintiffs' TAFDC and to pay the plaintiffs for any lost benefits in addition to other potential remedial measures. The plaintiffs do not allege that there is no possible basis upon which the Division, in performing its natural function, could provide such relief in this case. Therefore, the plaintiffs were not totally without administrative recourse.
Plaintiffs' Counsel's Second Affidavit on Futility of Exhaustion indicates that the Department, at the behest of plaintiffs' counsel, has undertaken certain measures to ensure the work requirements and sanctioning processes under the TAFDC program comport with the governing statute.
In certain circumstances, a court may exercise jurisdiction in spite of a failure to exhaust administrative remedies. However, such circumstances involve narrow situations in which the administrative agency is created by or acting under an unconstitutional statute, resort to administrative remedies would be futile, or where the administrative agency is dealing with an issue about which it clearly lacks jurisdiction. See Ciszewski v. Industrial Accident Board, 367 Mass. 135,140-41 (1975); East Chop Tennis Club, 364 Mass. at 451-52; Saint Luke's Hosp. v. Labor Relations Comm'n, 320 Mass. 467, 470-71 (1946). Upon review of the pleadings, however, it is apparent that these situations do not apply in this particular case.
Furthermore, the administrative process would have allowed the plaintiffs the opportunity to advance their legal arguments and preserve such challenges in the administrative record. The court then could address these claims in the ordinary course of judicial review with full access to all pertinent information, including the opinion of the agency charged with overseeing the TAFDC program.
The plaintiffs' allegation that an agency hearing officer may not rule an agency regulation illegal does not preclude the feasibility of any administrative relief to the plaintiffs. Furthermore, although an agency hearing officer may not rule an agency regulation illegal, this circumstance neither prevents the plaintiffs from raising their challenges to the validity of certain Department regulations in a administrative proceeding nor precludes the Division from hearing such challenges.
In light of the principles undergirding the exhaustion and primary jurisdiction doctrines, the court will not assert jurisdiction over the instant action when doing so would require the court to perform functions reserved for the Department in the first place. Saint Luke's Hosp., 320 Mass. at 470 ("Courts must be careful not to invade the province of an administrative board. The instances are rare where circumstances will require such interference"). Therefore, the plaintiffs' failure to invoke the available administrative process is fatal to its declaratory judgment action.
ORDER
For the foregoing reasons, it is hereby ORDERED that the defendants' motion to dismiss be ALLOWED as to all counts.