Quackenbush

This appeal arises from administrative proceedings to determine whether the State Farm insurance companies (collectively, State Farm) will be required to roll back their 1989 premium rates under Proposition 103 (Ins. Code, § 1861.01 et seq.). Insurance Commissioner Charles Quackenbush (Commissioner) rejected a proposed decision by an administrative law judge, who concluded State Farm owed no refund to its policyholders. The Commissioner ordered State Farm to roll back its 1989 rates by 3.7644 percent, and to refund over $200 million.

State Farm challenged the Commissioner’s ruling by petitioning the San Francisco Superior Court for a writ of administrative mandamus. The court issued an order partly granting and partly denying the petition. The parties agree the effect of the court’s ruling is to preclude any refund from State Farm to its policyholders. Both parties have appealed. However, State Farm concedes we need not consider its cross-appeal if we affirm the trial court’s order. In his appeal, the Commissioner contends the trial court misconstrued Department of Insurance regulations when (1) it ruled State Farm had provided reliable data justifying certain loss…