City Line Sales and Service, Inc. v. Commissioner of Department of Motor Vehicles

City Line Sales and Service, Inc. v. Commissioner of the Department of Motor Vehicles

No. HHBCV186043756S

Superior Court of Connecticut, Judicial District of New Britain, New Britain

January 15, 2020

UNPUBLISHED OPINION

Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Huddleston, Sheila A., J.

MEMORANDUM OF DECISION

Sheila A. Huddleston, Judge

This administrative appeal concerns the validity of certain fees paid by Amica Mutual Insurance Company (Amica) to obtain possession of a vehicle belonging to its insured that had been towed to the premises of the plaintiff, City Line Sales and Service, Inc. (City Line), a used car dealer and repairer, after a motor vehicle accident. Federal law preempts state regulation of consensual tows, but it allows states to regulate nonconsensual tows, including tows ordered by police to remove a damaged vehicle from an accident scene. Connecticut has exercised its authority to regulate nonconsensual tows through General Statutes § 14-66 and regulations promulgated by the Department of Motor Vehicles (department).

In this case, the department received a complaint from Amica about certain fees charged by City Line in relation to a nonconsensual tow. The department conducted an investigation and then commenced an administrative proceeding against City Line, alleging that it had violated § 14-66 and department regulations by charging impermissible fees. After an evidentiary hearing held over three days, the department’s hearing officer found City Line in violation and ordered it to pay restitution to Amica and a civil penalty to the department. City Line brought this appeal, naming the department’s commissioner as defendant, to challenge the department’s findings.

One finding was inconsistent with the rest of the decision. After oral argument and supplemental briefing, the court remanded the case to the hearing officer for clarification. Upon remand, after indicating that the original finding contained a scrivener’s error, the hearing officer issued a corrected finding. In light of the corrected finding, the court concludes that the department’s findings are supported by substantial evidence; that the department did not err in rejecting City Line’s claim that the statute and regulations had been waived; that the department’s hearing officer did not unduly limit City Line’s ability to cross examine witnesses or otherwise demonstrate bias; and that the hearing officer did not improperly decline to draw an adverse inference based on the department’s failure to call certain witnesses.

I THE DEPARTMENT’S FINDINGS AND CONCLUSIONS

The department’s final decision was issued on February 8, 2018 and the plaintiff filed a timely appeal on March 8, 2018. In the final decision, before its correction upon remand, the hearing officer made the following findings of fact:

1. City Line Sales and Service, Inc. (Licensee) is a used car dealer/repairer licensed by the Department of Motor Vehicles license number U-4929.

2. The Licensee maintains a dealer bond in the principal sum of $50, 000 through Western Surety Company, bond number 41934519. This bond is required by Section 14-52(b)(1) of the Connecticut General Statutes (CGS) and is subject to the provisions of Section 14-64(1) of the CGS.

3. On or about July 27, 2016, a business entity known as Copart Recovery performed a non-consensual tow of a 2003 Dodge Durango to the business premises of the Licensee at 31 Sage Avenue, Bridgeport, CT.

4. Amica Mutual Insurance Company of 43 Western Boulevard Glastonbury, Connecticut (Complainant) insured the 2003 Dodge Durango automobile which had been placed in the custody of the Licensee.

5. On or about August 2, 2016, the Complainant sent an appraiser to the Licensee’s business premises to inspect the subject vehicle.

6. On or about August 2, 2016, the Licensee charged the amount of $93.59 (tax included)^[1] characterized as an appraiser’s "escort fee."

7. On or about August 5, 2016, the Complainant dispatched Copart Recovery to retrieve the subject vehicle from the Licensee’s business premises. Copart Recovery subcontracted the vehicle retrieval to Anthony’s High Tech of Milford Connecticut.

8. On or about August 5, 2016, the Licensee charged a fee in the amount of $93.59 (tax included)^[2] to move the subject vehicle from the storage yard location for retrieval by Anthony’s High Tech, subcontractor for the salvage vendor, Copart Recovery. This fee is commonly known as a "gate fee."

9. At the time of the retrieval of the vehicle and assessment of the "gate fee" by Licensee, the agent of Copart Recovery was required to sign a document entitled "Consensual Tow Form."

10. The Complainant was required to reimburse Copart Recovery $93.59 for the appraiser’s "escort fee" and $93.59 for the "gate fee" for a total of $187.18.

11. The Complainant testified that it does not issue checks to the Licensee because the Licensee requires cash. In this instance, James Costello of Copart Recovery testified that the cash was made available to the subcontractor, Anthony’s High Tech which removed the subject vehicle from the Licensee’s premises.

12. At the within hearing, it was argued by the Licensee that there was no proof of payment by Anthony’s High Tech to the Licensee in exchange for the subject vehicle but the vehicle was released to the said subcontractor.

13. Licensee’s Exhibit 2 is an acknowledgment by the vehicle retriever, Anthony’s High Tech., that a fee was paid to Licensee as a pull-out or "gate fee."

14. The Licensee charged the pull-out or "gate fee" in exchange for expedited service to the vehicle retriever, Anthony’s High Tech.

15. Section 14-66(a)(3) provides that "no ... person, firm or corporation shall charge more than the rates and charges published by the Commissioner."

16. Reference is also made to Sections 14-63-36b(2)(G), 14-63-36c(a) and 14-63-36c(e) of the Regulations of Connecticut State agencies regarding rates and charges.

17. Neither the statute nor regulation permit a waiver of impermissible fees such as pull-out or "gate fees" and escort fees.

18. In addition to the relevant statutes and regulations, the following cases were proffered, reviewed and deemed relevant in this matter: Connecticut Motor Cars v. Commissioner of Motor Vehicles, 300 Conn. 617, 15 A.3d 1063 (2011); Towing & Recovery Professionals of Connecticut, Inc. v. Commissioner of DMV, Super.Ct., judicial district of New Britain, Docket No. CV 106005122S (2011).

Based on the findings quoted above, the hearing officer concluded that City Line had violated § § 14-63-36b(2)(G) and 14-36-63c(a) and (e) of the department’s regulations by charging an impermissible gate fee in the amount of $93.59 to Amica to move the subject vehicle for retrieval by Copart Recovery. The hearing officer further concluded that City Line had violated General Statutes § 14-66(a) and § 14-63-36c(a) of the department’s regulations by charging an escort fee in the amount of $93.59 to Amica for its appraiser to enter the yard to inspect the subject vehicle. The department ordered City Line to pay $187.18 in restitution to Amica and a civil penalty in the amount of $1, 000 to the department within thirty days of the date of the decision. The department further ordered that failure to pay the civil penalty to the department within the specified time would result in the department’s immediate suspension of City Line’s license until it complied with the order.

City Line appealed. It argued, first, that the finding that "Copart Recovery" performed the nonconsensual tow of the subject vehicle to City Line’s premises meant that any subsequent tow by City Line was consensual and therefore not subject to regulation by the department. The department apparently misperceived the nature of City Line’s claim and did not address the issue as to whether City Line or Copart had performed the initial nonconsensual tow. The court permitted supplemental briefing to allow the department to address this issue and to allow City Line to respond. In the department’s supplemental brief, it argued that the finding that Copart had performed the initial tow was a scrivener’s error. City Line responded, in a supplemental brief, that the department had not elicited clear testimony about the initial nonconsensual tow and the finding in the final decision represented the hearing officer’s interpretation of the evidence that was presented.

In light of the threshold importance of the finding at issue, the court remanded the case to the department for clarification as to the basis for imposing liability on City Line in light of the finding that Copart Recovery had performed the initial nonconsensual tow. On October 17, 2019, the department’s hearing officer issued a clarification which stated that the finding of fact regarding Copart Recovery was a scrivener’s error and should be corrected to provide as follows: "On or about July 27, 2016, City Line Sales and Service, Inc., the Licensee, performed a nonconsensual tow of a 2003 Dodge Durango automobile to the business premises of the Licensee at 31 Sage Avenue, Bridgeport, CT." The hearing officer vacated the original finding and substituted the finding that City Line had performed the initial nonconsensual tow. The hearing officer further stated that the conclusion of law, that City Line violated General Statutes § 14-66(a) and § § 14-63-36(b)(2)(G), 14-63-36c(a) and 14-63-36c(e), remained unchanged.

II SCOPE OF REVIEW

City Line appeals pursuant to General Statutes § 4-183.^[3] "[J]udicial review of the commissioner’s action is governed by the Uniform Administrative Procedure Act ... General Statutes § § 4-166 through 4-189 ... and the scope of that review is very restricted ... [R]eview of an administrative agency...