Farm Bureau Financial Services, Appellant,

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A21-0051

Farm Bureau Financial Services,
Appellant,

vs.

Dah Eh Ray, et al.,
Respondents.

Filed August 2, 2021
Affirmed in part, reversed in part, and remanded
Ross, Judge

Dakota County District Court
File No. 19HA-CV-20-519

Richard S. Stempel, Kevin C. Beach, Stempel & Associates, PLC, Excelsior, Minnesota
(for appellant)

Bradley H. Ratgen, Felix H. Valanzasca, Ratgen Personal Injury Law Firm, LLC, St. Paul,
Minnesota (for respondents)

Considered and decided by Cochran, Presiding Judge; Ross, Judge; and Frisch,
Judge.
NONPRECEDENTIAL OPINION
ROSS, Judge
Five automobile occupants sought insurance benefits for injuries after a crash, and
the insurer denied their claims. An arbitrator considering one of the occupant’s claims
granted the request only as to the occupant who was party to the arbitration and conditioned
on the insurer’s paying that occupant’s prior medical expenses. After the occupant
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prevailed in the arbitration on his insurance claim, the insurer brought a
declaratory-judgment action against all five occupants asking the district court to declare
that they breached their contractual duty to submit to examination under oath and that the
arbitrator exceeded his authority by imposing a condition on the insurer’s right to examine
one of the occupants. The district court dismissed the suit and confirmed the arbitration
award. On appeal, the insurer contends that the district court erred by dismissing the suit
for lack of a justiciable controversy, by refusing to treat the suit as a motion to vacate the
arbitration award, and by confirming the award in the absence of a motion to confirm it.
We affirm in part, reverse in part, and remand for further proceedings. We affirm the
district court’s refusal to treat the insurer’s suit as a motion to vacate the arbitration award
because the insurer neither formally captioned nor informally treated its complaint as a
motion to vacate. We affirm the district court’s decision to dismiss the civil complaint as
to three of the occupants because their claims have been finally adjudicated through
arbitration and the insurer cannot collaterally attack the adjudications through a civil suit.
But we reverse as premature the district court’s decision to confirm the arbitration award
because confirmation requires a motion and none was made, and we reverse the dismissal
as to the two occupants whose claims were not finally adjudicated by arbitration because
no justiciability concern forecloses a declaratory-judgment action regarding them.
FACTS
The five respondents —Dah Eh Ray, Dah Dah Ray, Lay Sen Lay, Paw Law, and
Kyaw Teh—were occupants in a car involved in an April 2018 collision. The car was
insured under a policy that one of them (Lay Sen Lay) had with Farm Bureau Financial
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Services. All five sought chiropractic treatment and all claimed no-fault insurance benefits
to cover their treatment costs. Relying on a clause in the insurance policy, in June 2018
Farm Bureau asked all of them to submit to examinations under oath. All refused, and Farm
Bureau denied their insurance claims based on that refusal.
The story gets a bit complicated here. One year after Farm Bureau denied the
insurance claims, four of the occupants (all but Kyaw Teh) petitioned to arbitrate their
claims. But one of the four (Dah Eh Ray) was already incarcerated for having murdered
another (Dah Dah Ray). Farm Bureau did not object to arbitration and, during the
arbitration of Dah Eh Ray’s claim, Farm Bureau moved the arbitrator to require Dah Eh
Ray to submit to an examination under oath. The arbitrator granted the motion on the
condition that Farm Bureau pay all of Dah Eh Ray’s expenses incurred before Farm Bureau
first asked him to submit to examination under oath. Farm Bureau did not object to that
condition but did not examine Dah Eh Ray (who did not appear during the arbitration,
presumably because of his incarceration). The arbitrator awarded Dah Eh Ray a significant
portion of his claim for chiropractic expenses. In a separate arbitration, an arbitrator
similarly granted most of the deceased Dah Dah Ray’s claim for chiropractic expenses.
And in a third arbitration, an arbitrator likewise granted most of Paw Law’s claim for
chiropractic expenses. Policyholder Lay Sen Lay withdrew his petition to arbitrate his
claim without saying why. And the record suggests that Kyaw Teh took no action on his
claim after refusing to submit to examination under oath.
Farm Bureau sued all five respondents in a November 2019 civil complaint styled
as a declaratory-judgment civil action in district court, asking the district court to declare
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that the respondents’ refusal to submit to Farm Bureau’s request for their examination
under oath in June 2018 constituted a breach of contract. As a remedy, Farm Bureau’s
complaint asked the district court to dismiss the respondents’ insurance claims or
alternatively order them to submit to examination under oath. It also asked the district court
to determine that the arbitrator in Dah Eh Ray’s case exceeded his authority by
conditioning Farm Bureau’s right to examine Dah Eh Ray on its paying much of his
chiropractic claim. Finally, the complaint asked the district court to vacate Dah Eh Ray’s
arbitration award.
The district court dismissed Farm Bureau’s complaint on justiciability grounds,
holding that Farm Bureau failed to move the district court to vacate the arbitration awards
and that “there is no genuine conflict between the parties because the matter came to a
conclusion when the arbitrator issued the award without objection.” It also confirmed Dah
Eh Ray’s award after the respondents’ memorandum of law requested that it do so. Farm
Bureau appeals.
DECISION
Farm Bureau raises three primary arguments on appeal. It maintains that the district
court erred by refusing to treat its civil complaint as a motion to vacate the arbitration award
or to allow it to present a motion to vacate before dismissing the complaint. It also contests
the justiciability-based dismissal and argues that a declaratory-judgment action was the
appropriate means to raise its challenge. And it finally challenges the district court’s
decision confirming Dah Eh Ray’s award without a motion. We address each argument in
turn.
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I
We reject Farm Bureau’s argument that the district court improperly refused to treat
its civil complaint as a motion to vacate Dah Eh Ray’s arbitration award. We review de
novo the district court’s construction of a civil complaint, “look[ing] at the essence of the
allegations contained in the complaint, and not at the legal concepts advocated by counsel”
to determine “the gravamen of the complaint.” D.A.B. v. Brown, 570 N.W.2d 168, 170–71
(Minn. App. 1997) (rejecting “counsel’s creative characterizations” and concluding that
“this case is a malpractice action,” not one for breach of fiduciary duty). Before analyzing
and construing the complaint here, we first explore what is at stake in the construction.
Whether the complaint is a civil complaint or a motion to vacate the arbitration
award determines whether it is a proper vehicle to undo the arbitrator’s award favoring Dah
Eh Ray’s insurance claim. The Uniform Arbitration Act (UAA), codified in Minnesota
Statutes sections 572B.01–.31 (2020), governs arbitration proceedings in Minnesota. And
under th at act, “a n application for judicial relief under sections 572B.01 to 572B.31 ”
(which includes a request to vacate an award based on an arbitrator’s exceeding his powers,
Minn. Stat. § 572B.23(a)), “must be made by motion to the court and heard in the manner
and upon the notice provided by law or rule of court for making and hearing motions.”
Minn. Stat. § 572B.05(a)); see also Minn. R. No-Fault Arb. 38 (stating that section 572B.23
governs the procedure to vacate a no-fault -insurance arbitration award). Timing matters
here as well as substance, because the act allows a motion to vacate only if it is filed within
90 days after the moving party receives notice of the arbitration award. Minn. Stat.
§ 572B.23(b); Wacker v. Allstate Ins. Co., 251 N.W.2d 346, 349– 50 (Minn. 1977). So
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unless Farm Bureau’s complaint, which was filed within 90 days after Dah Eh Ray’s
arbitration award, was a motion to vacate the award, it is not the mechanism by which Farm
Bureau could challenge the award.
Farm Bureau’s complaint was not a motion to vacate. Civil complaints and motions
are separate animals under the procedural rules. See Minn. R. Civ. P. 7.01 (“There shall be
a complaint and an answer.”); Id . 7.02 (“An application to the court for an order shall be
by motion.”). A “complaint” seeking a civil judgment informs a defendant of claims in a
legal action, and the complaint includes the title of the action in its caption. Id. 7.01, 10.01.
By contrast, a written “motion” informs the opposing party of a proceeding seeking an
order, and it similarly requires a writing designating itself as a motion by expre ss
description in its caption. Id. 7.02(a), (b), 10.01. Farm Bureau expressly captioned its
submission as a civil “COMPLAINT FOR DECLARATORY RELIEF,” not as a motion.
The complaint expressly announced that Farm Bureau “now brings this declaratory
judgment action pursuant to Minn. Stat. § 555.01” (the statute that permits an action for
declaratory judgment), not that it brings a motion under section 572B.23 (the statute that
permits a motion to vacate an arbitrator’s award). Farm Bureau followed none of the formal
or procedural requirements of a motion in district court but all of the formal and procedural
requirements of a civil action. The pleading included a civil cover sheet, which is required
of civil complaints but not generally of motions. See Minn. R. Gen. Prac. 104 (listing the
particulars that a party must include when “filing a civil case”). To the extent a civil cover
sheet may be required of a motion to vacate an arbitration award when a motion is the
initiating document in district court , Farm Bureau’s civil cover sheet described the action
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as a “Declaratory Judgment,” not as a motion. It included a summons, which is required of
civil complaints but not usually of motions. See Minn. R. Civ. P. 3.01 (requiring service of
a summons to commence a civil action); Minn. R. Gen. Prac. 115.03(a) (listing documents
a party must serve prior to a motion hearing and not including a summons). And the
summons here expressly notified the respondents, “The Plaintiff has started a lawsuit
against you. The Plaintiff’s Complaint against you is attached to this summons.” Farm
Bureau’s summons notified the respondents that they must provide “a written response
called an Answer within 20 days,” a requirement for civil complaints, not of motions. See
Minn. R. Civ. P. 12.01 (requiring an answer within 21 days after service of a summons);
Minn. R. Gen. Prac. 115.03(b) (listing responsive documents required for a motion and not
including an answer). Motions require the moving party to obtain a hearing date, Minn. R.
Gen. Prac. 115.02, and to serve on opposing counsel a notice of motion, a proposed order,
and a memorandum of law, id. 115.03. Farm Bureau obtained no hearing date and served
none of the papers that must accompany a motion.
Although the complaint mentions vacation as one of its asserted remedies, Farm
Bureau simply did and said nothing that might have suggested that it either believed or
wanted the court or the respondents to believe that its civil complaint was a motion to
vacate the arbitrator’s award under Minnesota Statutes section 572B.23. In fact, Farm
Bureau did not even attempt to recast its complaint as a motion to vacate until August 2020,
nine months following the arbitration award. This was after nine months of litigation over
the complaint as a civil action and after the respondents and the district court raised the
concern that Farm Bureau never brought a motion to vacate the award. These
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circumstances alert us to the supreme court’s admonition in the analogous case of
Haekenkamp v. Allstate Ins. Co.: “The filing of a petition with the district court by appellant
without setting a prompt hearing date opens the entire judicial process to manipulation and
abuse and the practice is to be condemned.” 265 N.W.2d 821, 824 (Minn. 1978)
(overlooking the omission only after concluding that “there is no showing respondent was
prejudiced in any way in this case since he immediately filed his motion to confirm the
arbitration award and had it promptly heard ”). We add that Farm Bureau’s complaint
named all five occupants and that most of their claims had not yet been arbitrated at the
time Farm Bureau served it; they therefore could not have been the subjects of a motion to
vacate. The district court did not mistreat the filing as a civil complaint rather than a motion.
Farm Bureau’s argument to the contrary is unavailing. It relies chiefly on Eide v.
State Farm Mut. Auto. Ins. Co. for the proposition that an exception to the motion
requirement exists and applies here. 492 N.W.2d 549 (Minn. App. 1992). We can assume
without determining that Eide, which we decided before the legislature amended the act to
use the term “motion” as the exclusive method to seek vacation of an arbitration award ,
remains binding and provides for an exception in the appropriate case. The Eide exception
clearly would not apply here.
In Eide, we held that an insurer’s failure to “formally file a motion for vacation of
the arbitration award” did not preclude the district court from reviewing the award de novo,
Id. at 554–55, but we did so in a unique procedural setting that differs materially from the
circumstances here. The question of potential vacation of the arbitrator’s eventual award
had already been presented in the district court even before the arbitration occurred. Id. at
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552–53. The insured in Eide had moved the court to compel arbitration despite an alleged
settlement agreement resolving the claim, the insurer had responded by opposing
arbitration, and the district court resolved the dispute by ordering arbitration despite the
insurer’s objection but expressly reserving the authority to review any consequent award
de novo. Id. The arbitration was essentially an interlocutory proceeding while the district
court maintained jurisdiction over the dispute about the arbitrator’s authority in the face of
the settlement agreement. And within 90 days after the arbitration when the insured
presented the case to the district court for the review previously contemplated, the insured
expressly invoked the district court’s prior order reserving its review authority. Id. at 553.
Eide does not stand for the broad proposition that an insurer can seek to vacate an
arbitration award by some vehicle other than a motion. We read Eide to teach instead that
an insurer may effectively ask the district court to vacate an arbitration award without a
motion if the question of the arbitrator’s authority was already before the district court and
the district court retained jurisdiction to review the question. Nothing remotely close to
those circumstances exists here, where the insurer voluntarily engaged in arbitration and
questioned the arbitrator’s exercise of authority only after the arbitrator rendered a decision
unfavorable to the insurer.
It is true, as Farm Bureau mentions, that Minnesota courts prefer to resolve cases on
the merits. But although we might construe court technical rules liberally in favor of
substance over form to advance this policy, see, e.g., Save Our Creeks v. City of Brooklyn
Park, 699 N.W.2d 307, 310 (Minn. 2005), we have no power allowing or policy enticing
us to override express legislative limits on the court’s authority to consider a matter, like
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the procedural limit imposed by Minnesota Statutes section 572B.05. For the same reason,
we reject Farm Bureau’s related contention that the district court should have treated the
complaint as a motion to vacate under Minnesota Rule of Civil Procedure 8. 05, which
states, “No technical forms of pleading or motions are required.” Farm Bureau’s error was
not a mere technical failure while forming a motion but a failure to attempt to form a
motion. We conclude that Farm Bureau’s civil complaint did not trigger the district court’s
authority to vacate the arbitration award. The complaint asserts that the arbitrator exceeded
his power by imposing the payment precondition on Farm Bureau’s opportunity to examine
Dah Eh Ray and therefore required the district court to vacate the award. The district court
properly rejected this claim because Farm Bureau failed to file the prerequisite motion to
vacate the award, as required by the statute.
Farm Bureau contends finally that the district court should have granted it leave to
file a motion to vacate. We reject the argument as unsupported procedurally and factually.
Procedurally, the rules of civil procedure do not require a party to obtain the district court’s
leave to file a motion. And factually, even if it they did, Farm Bureau never asked for or
was denied leave to file a motion.
II
We turn to Farm Bureau’s contention that the district court improperly dismissed its
complaint for lack of a justiciable controversy . The district court dismissed the complaint
on the grounds that Farm Bureau’s claim for a declaration that the respondents breached
the contract was unripe because the arbitration decisions finally resolved the fact issue
underlying Farm Bureau’s claim. We will not reverse a district court’s decision if we may
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affirm on a different theory. In re Senty-Haugen, 583 N.W.2d 266, 268 (Minn. 1998). For
the following reasons, we affirm the dismissal, in part, on a related ground that the
respondents raised to the district court.
We believe that Farm Bureau’s complaint failed to state a claim on which relief
could be granted as it regards three of the respondents . The respondents presented the
argument in the district court under Minnesota Rule of Civil Procedure 12.02(e). We decide
the issue de novo, accepting the complaint’s allegations as true and construing all
reasonable inferences in the complainant’s favor. Walsh v. U.S. Bank, N.A., 851 N.W.2d
598, 606 (Minn. 2014). A complaint is sufficient if, based on those allegations and
inferences, a court could grant relief. Id. at 603. We conclude that the district court could
not grant Farm Bureau relief on most of its legal claims.
The complaint alleges essentially that the respondents’ insurance claims were the
product of fraud and that they lost the right to insurance proceeds when they improperly
refused to be examined under oath about whether they were in the car at all and whether
they legitimately received the chiropractic services underlying their claims. As a result, the
complaint maintains, the arbitrator exceeded his authority by conditioning Farm Bureau’s
right to examine Dah Eh Ray under oath on the payment of most of his claim and the district
court should vacate the Dah Eh Ray arbitration award. We must answer whether these facts
support a viable claim of relief under Farm Bureau’s theory of the case.
They do not. A party cannot use a declaratory-judgment action to collaterally attack
a prior adjudication. Bengtson v. Setterberg, 35 N.W.2d 623, 627 (Minn. 1949). An
arbitration award is a final adjudication, may be challenged only through a motion to
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vacate, and cannot be challenged after the 90-day deadline has passed. Aufderhar v. Data
Dispatch, Inc., 452 N.W.2d 648, 651 (Minn. 1990); Wacker, 251 N.W.2d at 349–50;
Minn. Stat. § 572B.23(a)–(b) (2020). Farm Bureau’s complaint is primarily a collateral
attack on the Dah Eh Ray arbitration decision. It claims that he breached the insurance
contract by failing to submit to an examination, that the arbitrator should not have imposed
the condition on Farm Bureau’s right to examine Dah Eh Ray, and that the arbitration award
should be vacated. These are all attempts to undermine the final adjudication collaterally.
The district court properly dismissed the complaint as it regards Farm Bureau’s claims
against Dah Eh Ray.
For a related reason, we hold that the district court also properly dismissed the
claims against Paw Law and Dah Dah Ray. Those claims are moot. A court may adjudicate
only justiciable controversies. Izaak Walton League of Am. Endowment, Inc. v. State, Dep’t
of Nat. Res., 252 N.W.2d 852, 854 ( Minn. 1977). A justiciable controversy requires a
definite and concrete assertion of a legal right threatened in a genuine conflict between
parties with adverse, tangible interests, and the conflict must be capable of resolution by
judgment. McCaughtry v. City of Red Wing, 808 N.W.2d 331, 336 (Minn. 2011). Mootness
is an aspect of justiciability. See Kahn v. Griffin, 701 N.W.2d 815, 821 (Minn. 2005). An
issue is moot unless a party’s tangible interest in the conflict exists throughout the
litigation. Id. An issue on appeal is moot if, pending the appellate decision, an event occurs
that makes a merits decision unnecessary or effective relief impossible. Szarzynski v.
Szarzynski, 732 N.W.2d 285, 291 (Minn. App. 2007). Paw Law and Dah Dah Ray’s
arbitration awards make a merits decision on the declaratory claims unnecessary, rendering
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those claims moot. Because those claims have already been awarded, a merits decision is
wholly unnecessary as to whether these respondents breached the insurance policy by
refusing to be examined or whether their insurance claims arose from fraud. And the relief
sought—the dismissal of their insurance claims—is no longer a viable remedy. Farm
Bureau’s legal claims against Paw Law and Dah Dah Ray are moot.
We emphasize the procedural rather than substantive basis of our decision. Farm
Bureau accurately asserts that an insurance contract may require a claimant to attend an
examination under oath if the examination is “reasonably necessary” for the insurer to
investigate and resolve the claims. W. Nat. Ins. Co. v. Thompson, 797 N.W.2d 201, 206
(Minn. 2011) (interpreting Minn. Stat. § 65B.56, subd. 1 (2010)). A claimant may refuse
only an insurer’s unreasonable examination request without breaching the contract. See id.
at 206–07. No-fault insurance arbitrators have authority to decide the reasonableness of an
insurer’s request and the reasonableness of a claimant’s refusal. Id. at 208. By granting
Farm Bureau’s request to examine Dah Eh Ray, the arbitrator necessarily determined both
that Farm Bureau’s request to examine Dah Eh Ray was reasonable and that Dah Eh Ray’s
refusal to be examined was not. The respondents do not identify any legal authority for an
arbitrator to restrict or condition an insurer’s right to conduct a reasonably necessary
examination. Our decision affirming the dismissal therefore should not be read as
endorsing an arbitrator’s decision to impose a condition on the insurer’s right. We say only
that Farm Bureau’s approach to the dispute prevented the district court from reaching the
issue.
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This leaves only the declaratory-judgment claims against Kyaw Teh and Lay Sen
Lay. Our holding that Farm Bureau’s civil complaint is not a motion to vacate Dah Eh
Ray’s arbitration award does not prevent it from serving as it was captioned—as a
declaratory-judgment complaint. In that complaint, Farm Bureau seek s a judicial
determination as to whether Kyaw Teh and Lay Sen Lay breached the policy by refusing
to present themselves for examination and whether they are now subject to examination.
These issues are not resolved by our holding or the district court’s rationale. We reverse
the district court’s dismissal of the complaint against those two respondents, and we
remand for further proceedings.
III
Farm Bureau correctly argues that the district court improperly confirmed Dah Eh
Ray’s arbitration award without receiving a motion to confirm. The party prevailing at
arbitration “may file a motion with the court for an order confirming the award, at which
time the court shall issue such an order unless the award is modified or corrected . . . or is
vacated.” Minn. Stat. § 572B.22. A district court may also confirm an award “[i]f a motion
to vacate an award is denied and a motion to modify or correct the award is not pending.”
Minn. Stat. § 572.23(d). Dah Eh Ray did not move to confirm his arbitration award, instead
requesting confirmation only in a memorandum responding to the justiciability issue raised
by the district court. Confirming the award without a motion was error.
Affirmed in part, reversed in part, and remanded.