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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Osbakken v. Whittington (12/7/2012) sp-6729
Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER .
Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email
corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
TAWNYA OSBAKKEN, PETER )
BARNES, and TAMARA BLACK, ) Supreme Court No. S-14126
)
Appellants, ) Superior Court No. 3AN-07-06440 CI
)
v. ) O P I N I O N
)
PEGGY JO WHITTINGTON, d/b/a ) No. 6729 - December 7, 2012
ILLIAMNA SERVICES. )
)
Appellee. )
)
Appeal from the Superior Court of the State of Alaska, Third
Judicial District, Anchorage, John Suddock, Judge.
Appearances: Nikole Nelson, James J. Davis, Jr., and Robert
P. Lynch, Alaska Legal Services Corporation, for Appellants.
No appearance by Appellee.
Before: Carpeneti, Chief Justice, Fabe, Winfree, and
Stowers, Justices.
CARPENETI, Chief Justice.
I. INTRODUCTION
Five disabled Alaskans sued their former representative payee (an
individual appointed by the Social Security Administration to receive benefits for
someone unable to manage his or her money). At the conclusion of trial, the superior
court awarded both compensatory and punitive damages to the plaintiffs; it also entered
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certain injunctive relief against the representative payee as to both parties and non-
parties. But it declined to enter other injunctive relief as to non-parties. Three of the
plaintiffs appeal. They argue that the superior court failed to understand that non-party
injunctive relief was available under Alaska's Unfair Trade Practices and Consumer
Protection Act. Because the superior court actually entered non-party injunctive relief,
we disagree with the plaintiffs' characterization of the superior court proceedings and
affirm the superior court in all respects.
II. FACTS AND PROCEEDINGS
1
Five disabled Alaskans (the beneficiaries) who received social security and
other government benefits sued Peggy Jo Whittington, their former representative
payee.2 The beneficiaries alleged that Whittington violated several legal duties owed to
them while managing their finances.
The central issue in this appeal regards plaintiffs' allegation that
Whittington violated the Unfair Trade Practices and Consumer Protection Act (UTPA).
The superior court concluded that Whittington violated UTPA by: implying the fee she
charged was approved by the Social Security Administration; continuing to charge
1 The five plaintiffs were Tawnya Osbakken, Peter Barnes, Tamara Black,
Ethel Bruce, and Elizabeth Wolford. Bruce and Wolford passed away before this appeal
was taken.
2 "A representative payee is an individual or organization appointed by [the
Social Security Administration] to receive Social Security and/or [Supplemental Security
Income] benefits for someone who cannot manage or direct someone else to manage his
or her money. The main responsibilities of a payee are to use the benefits to pay for the
current and foreseeable needs of the beneficiary and properly save any benefits not
needed to meet current needs." SOCIAL SECURITY ADMINISTRATION , FAQS FOR
REPRESENTATIVE PAYEES , http://www.ssa.gov/payee/faqrep.htm (last visited November
20, 2012). Whittington was doing business as Illiamna Services, IS, Inc., and Alliance
Services.
-2- 6729
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monthly fees after clients provided notice of termination; failing to provide statements
to clients upon request; sending out a letter providing that Whittington would be joining
another individual in a joint venture, where no definitive intent ever existed; and
appointing herself paid trustee for clients without their permission.
The beneficiaries also alleged that Whittington was professionally negligent
in her duties. The superior court concluded that Whittington was professionally
negligent by: paying client bills from client's checking or savings account, where the
bills could have been paid from a separate trust; failing to provide clients with their
living allowances; failing to account for money; charging double termination fees; and
engaging in a "pervasive pattern of incompetence in the running of [her] business."
The superior court awarded compensatory damages and punitive damages
to the beneficiaries. The superior court also ordered the following injunctive relief in the
event Whittington ever goes "back into the business": Whittington may not act in a
fiduciary capacity for more than 30 clients at a time; she must provide all future clients
with monthly statements; and she must notify all future clients "that she was found liable
for unfair trade practices and . . . professional negligence." Although the beneficiaries
had requested additional relief, primarily non-party injunctive relief, the superior court
found that "it [was] not appropriate to grant non-party relief in this case." The superior
court added, "[i]f you want non-party relief in general, you have to file a class action."
Plaintiffs appeal what they view as the superior court's failure to recognize
that non-party injunctive relief is available under UTPA.
-3- 6729
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III. STANDARD OF REVIEW
"Questions regarding the interpretation and application of a statute are
questions of law to which we apply our independent judgment."3 We adopt "the rule of
law most persuasive in light of precedent, reason, and policy."4
IV. DISCUSSION
The Superior Court Understood That Non-Party Injunctive Relief Was
Available Under Alaska's UTPA.
The beneficiaries' sole argument on appeal is that "the trial court erred in
holding that, absent a class action, non-party injunctive relief is unavailable under
Alaska's UTPA." The beneficiaries contend that the superior court's order "is
inconsistent with both the plain language of [AS 45.50.535] and legislative intent."
Alaska Statute 45.50.535 provides for private injunctive relief under
UTPA. In particular, AS 45.50.535(a) reads:
Subject to (b) of this section and in addition to any right to
bring an action under AS 45.50.531 or other law, any person
who was the victim of the unlawful act, whether or not the
person suffered actual damages, may bring an action to
obtain an injunction prohibiting a seller or lessor from
continuing to engage in an act or practice declared unlawful
under AS 45.50.471.
(Emphasis added.) We agree with the beneficiaries that the plain language of AS
45.50.535(a) resolves the issue of whether non-party injunctive relief is available under
3 State v. Jeffery, 170 P.3d 226, 229 (Alaska 2007).
4 Jacob v. State, Dep't of Health & Soc. Servs., Office of Children's Servs. ,
177 P.3d 1181, 1184 (Alaska 2008) (citations omitted).
-4- 6729
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UTPA - the benefit of an injunction broadly prohibiting a seller or lessor from
continuing to engage in unfair trade practices would absolutely apply to non-parties.5
But while we agree with this legal argument in the abstract, we disagree
with the characterization of the superior court's action. The beneficiaries rely on the
final two sentences of the superior court's order, which provides: "Next, I find that it is
not appropriate to grant non-party relief in this case. If you want non-party relief in
general, you have to file a class action." Based on this language, the beneficiaries
contend the superior court held "that, absent a class action, non-party injunctive relief
is unavailable under Alaska's UTPA."
But this is clearly not the superior court's holding. The superior court
recognized that non-party injunctive relief was available under AS 45.50.535, because
in the same order the court entered non-party injunctive relief (that is, injunctive relief
that will pertain to persons who are not parties to this case). It issued several orders that
will effectively prohibit Whittington from continuing to engage in unfair trade practices.
It ordered that Whittington may not act in a fiduciary capacity for more than 30 clients;
she must provide monthly statements to clients; and she must notify all future clients
"that she was found liable for unfair trade practices and . . . professional negligence."
This injunctive relief will benefit non-parties by effectively prohibiting Whittington from
engaging in unfair trade practices. We interpret the two sentences that the beneficiaries
focus on as representing the superior court's decision not to grantfurther non-party relief
beyond that which it had already ordered.
5 The legislative history regarding the intent of AS 45.50.535 to provide non-
party injunctive relief under UTPA is equally compelling. See, e.g., Minutes, House
Judiciary Comm. Hearing on H.B. 203, 20th Leg., 2d Sess. (Feb. 9, 1998) (statement of
Rep. Fred Dyson and testimony of Julia Coster) (each explaining AS 45.50.535's intent
to allow private citizens to act as private attorneys general).
-5- 6729
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Finally, to the extent that appellants seek further injunctive relief, the
superior court's power was discretionary and it chose not to enter such relief.6 The
beneficiaries have not challenged this discretionary decision on appeal.
V. CONCLUSION
The superior court understood that it had the power to issue non-party
injunctive relief because it issued such relief. For that reason, we reject the beneficiaries'
claim that the superior court held that non-party injunctive relief is unavailable without
a class action in Alaska, and AFFIRM the decision of the superior court.
6 The beneficiaries appear primarily interested in an order that would require
Whittington to produce accountings for all of her former clients. Because the court
decided not to enter such an order and the beneficiaries have not challenged this decision
on appeal, we do not reach the issue of whether the superior court had the power to order
an accounting for non-parties in this case.
-6- 6729
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