Civil Practice – Uniform Declaratory Judgments Act – Justiciable Controversy

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The legal right Appellants asserted is at stake is the right to have a court of the unified judicial system decide their contract claims. They legally and knowingly waived this right in their respective contracts with the Respondents. Therefore, there are no legal rights at issue and the legal question presented is a purely academic exercise that is not justiciable.

We affirmed as modified the circuit court’s dismissal of Appellants’ declaratory judgment actions.

Appellants JMI Sports, JMSI College, LLC, and Intellectual Capitol in these consolidated cases obtained contracts through the state procurement process with Respondent Workers’ Compensation Commission and Respondent Clemson University, respectively. After disputes arose under the contracts, Respondents filed Requests for Resolution of Contract Controversy with the Chief Procurement Officer (CPO) for the State of South Carolina. Appellants then filed separate declaratory judgment actions in circuit court, alleging that section 11-35-4230 of the South Carolina Code is unconstitutional because it violates the Separation of Powers Clause, Article I, Section 8, and Article V, Sections 1 and 11, of the South Carolina Constitution. The circuit court granted Respondents’ motions to dismiss the declaratory judgment actions, ruling section 11-35-4230 placed exclusive jurisdiction over the State’s contract disputes with the CPO. The circuit court also dismissed Appellants’ constitutional claims as premature for failure to exhaust their administrative remedies.

In its orders granting Respondents’ motions to dismiss Appellants’ declaratory judgment actions, the circuit court stated: “The CPO has exclusive jurisdiction over the contract controversy between the parties here, and because [Appellants] have failed to exhaust their administrative remedies, this Court dismisses the action. [Appellants] claims are premature at this point.” Appellants now asserted the circuit court erred because: (1) the Uniform Declaratory Judgments Act does not require exhaustion of administrative remedies in order for the circuit court to declare “rights, status, and other legal relations,” S.C. Code Ann. § 15-53-30 (2005); and (2) the CPO is without authority to declare the constitutionality of any statute, including section 11-35-4230. Respondents, by contrast, contended Appellants waived any challenge to the CPO’s authority to preside over their procurement-contract claims when they contractually agreed to have their disputes decided by the CPO, and that therefore, dismissal of the declaratory judgment actions was proper. We agreed with Respondents.

Because Appellants unambiguously agreed to have their underlying disputes initially decided by the CPO, they waived the very rights at issue in this constitutional challenge. Without a justiciable controversy, Appellants’ challenge to section 11-35-4230 is a purely academic exercise. Accordingly, we affirmed the circuit court’s order dismissing Appellants’ declaratory judgment actions.

Affirmed as modified.

Richards v. Spicer (Lawyers’ Weekly No. 010-025-25, 9 pp.) (Letitia H. Verdin, J.) Appealed from Richland County Circuit Court (Alison Renee Lee, J.) James G. Carpenter, of Carpenter Law Firm, PC, of Greenville; John E. Schmidt, III, and Melissa Javon Copeland, both of Schmidt & Copeland, LLC, of Columbia, all for Appellants; Michael H. Montgomery, of Montgomery Willard, LLC, of Columbia; Boyd Benjamin Nicholson, Jr., of Haynsworth Sinkler Boyd, PA, of Greenville; Manton M. Grier, Jr., State Fiscal Accountability Authority, of Columbia, all for Respondents. South Carolina Supreme Court