State v. Miles

¶31 (concurring) —Although I agree with the majority’s conclusion that RCW 21.20.380 does not provide authority of law under the facts of this case, I disagree with the majority’s reasoning. The majority finds that “[t]he protections afforded by the warrant or subpoena process are lacking here,” majority at 247, but it never discusses what the subpoena process entails. The majority then concludes that chapter 21.20 RCW is invalid insofar as it permits the Washington State Securities Division of the Department of Financial Institutions (Division) to subpoena third parties for “otherwise private information.” Majority at 252.1 fear that such a broad pronouncement calls into question the validity of other statutes authorizing administrative subpoenas, and thus I would render a narrower holding based upon the facts before us.

Bridge, J.

¶32 As discussed by the majority, our state constitution prohibits the invasion of private affairs without authority of law. See Wash. Const, art. I, § 7. I agree with the majority that for purposes of our constitution, bank records constitute “private affairs.” However, I believe that in its analysis of the second part of the constitutional provision (“authority of law”), the majority does not clearly explicate the subpoena process, thus creating uncertainty as to the scope of our holding in this case.

¶33 Under article I, section 7, a warrantless search is per se invalid. See State v. Ladson, 138 Wn.2d 343, 349, 979 P.2d 833 (1999) (quoting State v. Hendrickson, 129 Wn.2d 61, 70, 917 P.2d 563 (1996)). However, we have recognized certain exceptions to the warrant requirement: “consent, exigent circumstances, searches incident to a valid arrest, inventory searches, plain view, and Terry[¹⁰] investigative stops.” Id. We have also recognized that a warrant is not necessary for administrative subpoenas. See Steele v. State, 85 Wn.2d 585, 592, 537 P.2d 782 (1975).

¶34 In Steele, the attorney general served a civil investigative demand on an employment agency, pursuant to a provision of the Consumer Protection Act, chapter 19.86 RCW. Id. at 586. The respondents challenged this demand, arguing that it constituted an unreasonable search and seizure. Id. at 592. We applied the test set forth by the United States Supreme Court in Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 209, 66 S. Ct. 494, 90 L. Ed. 614 (1946), and United States v. Morton Salt Co., 338 U.S. 632, 652, 70 S. Ct. 357, 94 L. Ed. 401 (1950), for determining the reasonableness of an administrative subpoena: (1) the inquiry must be within the authority of the agency, (2) the demand must not be too indefinite, and (3) the information sought must be reasonably relevant. Steele, 85 Wn.2d at 594. Applying this test, we found that the subpoena was lawful under the Fourth Amendment to the United States Constitution. Id. at 595. We were careful to note, however, that in those situations in which it appeared that the attorney general had acted arbitrarily, “the supplicant is authorized by RCW 19.86.110(7) to petition the appropriate superior court and, upon a showing of good cause, the investigative demand may be set aside.” Id.

¶35 The Court of Appeals reiterated the importance of these protections in Department of Revenue v. March, 25 Wn. App. 314, 610 P.2d 916 (1979). In that case, the Department of Revenue sought to audit a business owner and for purposes of the audit requested his business records. Id. at 316. When the respondent failed to comply, the department obtained a court order. Id. at 317. The Court of Appeals affirmed, finding that

[i]n upholding the right to summon and require production, the [United States] Supreme Court has noted that the taxpayer’s protection from unreasonable requests is afforded by the fact that the summons can be enforced only by court order. Therein lies the source of relief for the taxpayer from harassment and other improper action.

Id. at 321. The Court of Appeals found that “[t]he provisions of RCW 82.32.110 providing for resort to superior court in the event of refusal to obey the summons secures the constitutional protection . . . .” Id. at 322.

f 36 The majority here finds that RCW 21.20.380 cannot provide authority of law because it “has no safeguards and would allow the state to intrude into private affairs for little or no reason.” Majority at 248. However, the statute contains a provision calling for judicial enforcement in the case of a refusal to obey, as did the statutes at issue in Steele and March. See RCW 21.20.380(4) (formerly RCW 21.20.380(3)). Additionally, Washington’s Administrative Procedure Act (WAPA) provides generally for judicial enforcement of administrative subpoenas. RCW 34.05.588. The superior court shall order compliance with an administrative subpoena if “it appears to the court that the subpoena was properly issued, that the investigation is being conducted for a lawfully authorized purpose, and that the testimony or documents required to be produced are adequately specified and relevant to the investigation.” RCW 34.05.588(2). WAPA addresses the major elements of a constitutional search and seizure: (1) a neutral magistrate, (2) limited and specific scope of the request, and (3) relevance to the investigation. Therefore, I would find that safeguards exist, but that here Miles was not afforded the opportunity to invoke them.

¶37 The majority is concerned with the fact that the Division’s request here was broad, encompassing both personal and business banking records. See majority at 249. However, the safeguards outlined above would allow Miles to argue before a neutral magistrate that the scope of the Division’s request exceeded that necessary for the investigation. I believe that this type of case-by-case review is proper, rather than issuing broad statements about what types of information may be requested from whom. Such statements have a potentially deleterious effect on statutes not before us, and thus I hesitate to join the majority. Instead, I concur.

Madsen and Owens, JJ., concur with Bridge, J.

Reconsideration denied August 6, 2007.

10 Terry v. Ohio, 392 U.S. 1, 88 S. Ct. 1868, 20 L. Ed. 2d 889 (1968).