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1 STATE OF SOUTH CAROLINA ADMINISTRATIVE LAW COURT South Carolina Department of Motor Vehicles, v. Aimee Jo Bosco, Appellant, Respondent. Docket No.: 07-ALJ AP ORDER STATEMENT OF CASE THIS MATTER is an appeal by the South Carolina Department of Motor Vehicles (the Department from the Final Order and Decision by the South Carolina Department of Motor Vehicles Hearings (the DMVH. The DMVH s Order was issued in connection with an administrative hearing that was held pursuant to S.C. Code Ann (2006. The Department contends that the DMVH hearing officer was in error for rescinding the suspension of Aimee Jo Bosco ( Respondent because the duty to maintain motor vehicle liability coverage belongs to the owner and is not delegable to a third party. The Administrative Law Court ( ALC has jurisdiction to hear this matter pursuant to S.C. Code Ann (Supp Upon consideration of the record, the DMVH s Order is REVERSED. BRIEF HISTORY On February 16, 2007, Respondent was involved in a motor vehicle accident and was never notified that her ex-husband, Roy C. Price ( Price, had cancelled her motor vehicle liability policy on June 9, On May 17, 2007, the Department notified Respondent that, pursuant to S.C. Code Ann , her license and registration were subject to suspension as of June 1, Respondent requested an administrative hearing under Section The DMVH scheduled a hearing for July 3, 2007, and the Department Hearing Officer ( DHO issued a Final Order and Decision on July 24, In the order, the DHO held that the mutual verbal agreement that Respondent s ex-husband agreed to

2 maintain the liability coverage and Respondent s lack of notice of the policy cancellation were cause for rescission of the suspension. FACTS On February 16, 2007, Respondent was in a motor vehicle accident on Sunset Boulevard in Lexington County, South Carolina. After verifying Respondent s insurance at the scene of the accident, the police officer discovered, to Respondent s surprise, that Respondent was uninsured. Respondent s liability coverage was being paid by Price, her ex-husband, until he canceled the coverage mid-term. Within three (3 days of the accident, Respondent had contacted South Carolina Farm Bureau Insurance Company and obtained an individual motor vehicle insurance policy. On May 17, 2007, Respondent received an Official Notice from the Department that her driver s license and registration were subject to suspension pursuant to Section as of June 1, The notice informed Respondent of the requirements for compliance with the rules of establishing Financial Responsibility and stated that Respondent would have to pay a fee of $550 to have her driver s license reinstated. The notice also informed Respondent of her right to request a hearing to show why the suspension should not be enforced. Respondent requested a hearing. The DMVH hearing was held on July 3, 2007 with the DHO and Respondent in attendance. Respondent stated for the record that she was unaware that her insurance had been cancelled prior to her accident. Notification was never provided to Respondent from the Department, Ford Credit, South Carolina Farm Bureau Insurance Company, or from her husband. Respondent stated, however, that she immediately called an insurance agent the day following the accident and signed a policy two days later. After entering into the record a letter from South Carolina Farm Bureau agent Chrystal A. Veld, Respondent explained the circumstances that gave rise to this matter. Respondent stated that she and Price divorced in October 2006 after being separated for five (5 or six (6 years. She stated that Price paid the insurance during the entire period of their separation, leading up to the date he cancelled her coverage. However, she stated that she never received any notification when Price cancelled her liability coverage on June 9, Hrg. Trans. 8: In response to further questioning by the DHO, Respondent stated that she had a verbal agreement with Price, that she would purchase a 2

3 car and that Price would pay her car insurance. Although Respondent stated that Price carried both cars under the same policy, she did not offer any real evidence to show that the policy was issued in Respondent s name. The letter from South Carolina Farm Bureau, however, explains that Price was allowed to remove Respondent from the policy and cancel her coverage because Price was the policyholder. On July 27, 2007, the DHO issued a Final Order and Decision rescinding the suspension of Respondent s driver s license and registration. In support of the rescission, the DHO found that there was no evidence that Respondent was notified that her policy was cancelled. Although Respondent paid the note on the car, the DHO found that Price assumed responsibility to pay the insurance and never notified Respondent that her coverage was being cancelled. The DHO found these facts were cause for rescission of Respondent s suspension. STANDARD OF REVIEW The DMVH is authorized by law to determine contested cases arising from the Department. See S.C. Code Ann (Supp Therefore, the DMVH is an agency under the Administrative Procedures Act ( APA. See S.C. Code Ann (2 (2005. As such, the APA s standard of review governs appeals from decisions of the DMVH. See S.C. Code Ann (A (Supp. 2006; see also Byerly Hosp. v. S.C. State Health & Human Servs. Fin. Comm n, 319 S.C. 225, 229, 460 S.E.2d 383, 385 (1995. The standard used by appellate bodies, including the ALC, to review agency decisions is provided by S.C. Code Ann (A(5 (Supp See S.C. Code Ann (B (Supp (directing Administrative Law Judges to conduct appellate review in the same manner prescribed in Section (A. This section provides: The court may not substitute its judgment for the judgment of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings. The court may reverse or modify the decision [of the agency] if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: (a in violation of constitutional or statutory provisions; 3

4 (b (c (d (e (f in excess of the statutory authority of the agency; made upon unlawful procedure; affected by other error of law; S.C. Code Ann (A(5 (Supp clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion. A decision is supported by substantial evidence when the record as a whole allows reasonable minds to reach the same conclusion reached by the agency. Bilton v. Best Western Royal Motor Lodge, 282 S.C. 634, 641, 321 S.E.2d 63, 68 (Ct. App A decision will not be set aside simply because reasonable minds may differ on the judgment. Lark, 276 S.C. at 136, 276 S.E.2d 304, 307. The fact that the record, when considered as a whole, presents the possibility of drawing two inconsistent conclusions from the evidence does not prevent the agency s findings from being supported by substantial evidence. Waters v. S.C. Land Resources Conservation Comm n, 321 S.C. 219, 226, 467 S.E.2d 913, 917 (1996; Grant v. S.C. Coastal Council, 319 S.C. 348, 353, 461 S.E.2d 388, 391 (1995. In applying the substantial evidence rule, the factual findings of the administrative agency are presumed to be correct. Rodney v. Michelin Tire Co., 320 S.C. 515, 519, 466 S.E.2d 357, 359 (1996 (citing Kearse v. State Health and Human Servs. Fin. Comm n, 318 S.C. 198, 200, 456 S.E.2d 892, 893 (1995. The party challenging an agency action has the burden of proving convincingly that the agency s decision is unsupported by substantial evidence. Waters, 321 S.C. at 226, 467 S.E.2d at 917. ISSUE ON APPEAL Did the DHO err in rescinding Respondent s suspension based upon a finding that Respondent lacked notice that her ex-husband cancelled her motor vehicle liability policy? Pursuant to S.C. Code Ann (5 (2006, a motor vehicle liability policy is defined as an owner s or operator s policy of liability insurance. Before the 4

5 Department will issue a registration certificate, every owner of a motor vehicle must show that a liability policy (a/k/a security has been obtained. S.C. Code Ann (2006. More importantly, however, the rules surrounding Motor Vehicle and Financial Security require every motor vehicle owner to maintain security for the duration of the registration period. Id. These rules afford the public protection by ensuring that registered and licensed motor vehicles have at least the minimum amount of liability coverage. Shores v. Weaver, 315 S.C. 347, 433 S.E. 2d 913 (Ct. App Based upon the motor vehicle laws of the State and the facts contained in the record, the order from the DMVH hearing cannot be sustained. Pursuant to S.C. Code Ann (2006, when an uninsured driver is involved in a reportable accident that results in property damage, the driver s license and registration shall be suspended. Section affords the uninsured driver an opportunity to request an administrative before the suspension becomes effective to show cause why the suspension should not be enforced. A DMVH hearing was held for Respondent, but she failed to proffer any evidence to support a showing of cause for rescission of her suspension. At the hearing, Respondent stated that she owned and operated the vehicle that was involved in the accident. Respondent indicated to the DHO that a mutual agreement existed with Price, that he would pay the insurance on her new motor vehicle. Respondent stated that Price carried the insurance of both vehicles under the same policy. Hrg. Trans 7:9-11. Respondent testified that she never received notice of the cancellation from her husband, the insurance carrier, or from Ford Credit. Respondent proffered a letter from South Carolina Farm Bureau Insurance Company that stated notification was mailed to Price s address, the named policy holder, after he requested Respondent s removal from coverage. While the Court is sympathetic to Respondent and the circumstances surrounding the separation from her husband, Section of the Motor Vehicle Financial Responsibility Act requires that Respondent, as the owner, assume the duty for maintaining liability coverage on her motor vehicle. Respondent entered into evidence a letter from the insurance company that indicated Price was the policyholder and that he received notice of the cancellation after he voluntarily cancelled her coverage. After 5

6 reviewing the record, the Court finds that the DHO erred in rescinding Respondent s suspension and finds that the Final Order and Decision from July 24, 2007 should be reversed. IT IS THEREFORE ORDERED, that the Order of the DHO is REVERSED and the suspension of Respondent s driving license and registration is reinstated. April 14, 2008 Columbia, SC John D. McLeod, Judge S.C. Administrative Law Court 6