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Alaska Department of Revenue v. Hale (4/30/99), 978 P 2d 1276
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.
THE SUPREME COURT OF THE STATE OF ALASKA
STATE OF ALASKA, DEPARTMENT )
OF REVENUE, PERMANENT FUND ) Supreme Court No. S-7984
DIVIDEND DIVISION, )
) Superior Court No.
v. ) 3AN-95-10706 CI
JOAN HALE, ) O P I N I O N
Appellee. ) [No. 5112 - April 30, 1999]
Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
Brian C. Shortell, Judge.
Appearances: Mary Ellen Beardsley, Assistant
Attorney General, Anchorage, Bruce M. Botelho, Attorney General,
Juneau, for Appellant. Lynn M. Allingham, Law Offices of Lynn M.
Allingham, Anchorage, for Appellee.
Before: Matthews, Chief Justice, Compton,
Eastaugh, and Bryner, Justices. [Fabe,
Justice, not participating.]
MATTHEWS, Chief Justice.
In 1990 Joan Hale, an Alaska resident, moved out of the
state to accompany her husband, also an Alaska resident, who was
assigned to a new military duty station. The Department of Revenue
denied her a permanent fund dividend for 1993 even though under the
applicable regulation, 15 Alaska Administrative Code (AAC)
23.163(c)(15) (1998), an absence from the state while accompanying
an eligible spouse was an allowable absence and her spouse remained
eligible. The Department of Revenue based its ruling on the last
sentence of AS 43.23.015(a), which provides that in determining the
eligibility of an individual "the residency of an individual's
spouse may not be the principal factor relied upon by the
commissioner in determining the residency of the individual."[Fn.
1] The Department also relied on a superior court decision
involving residents who left the state to accompany non-resident
spouses on new military assignments. That case, Zeiler v. State,
No. 3AN-92-1567 Ci. (Alaska Super., December 16, 1993), held that
AS 43.23.015(a) invalidated regulation 15 AAC 23.163(c)(15).
The superior court in the present case reversed the
ruling of the Department. It ruled that in Hale's case her
spouse's residency was not the principal factor determining her
residency. [Fn. 2] It also ruled that Hale was not barred under
the doctrine of collateral estoppel by the Zeiler decision. We
conclude that both of these rulings are correct and affirm.
To establish residency for purposes of permanent fund
dividend eligibility, an individual who is not physically present
in the state must (1) intend to return to the state and remain
permanently in the state and (2) be absent only for reasons
specified in AS 43.23.095(8) or in regulations propounded by the
commissioner. An absence for military service is allowable, [Fn.
3] and so is "accompanying an eligible individual as the spouse
. . . of the eligible individual."[Fn. 4] Hale was therefore a
resident because she met both the intent and the allowable absence
In her case the allowable absence requirement depended on
the residency of her spouse. But it is not accurate to character-
ize that requirement as "the principal factor"which determined her
residency. Instead the allowable absence requirement is one of two
requirements determinative of her residency. Because both require-
ments must be met, neither has primacy over the other and neither
can be described as the principal factor which determines
residency. [Fn. 5] Therefore the Department erred in concluding
that AS 43.23.015(a) barred her eligibility.
The Department sought to use the doctrine of collateral
estoppel against Hale. It contended that the Zeiler decision
precluded it from applying 15 AAC 23.163(c)(15) in her case. The
doctrine of collateral estoppel precludes the relitigation of
issues that have already been decided. But the rule only applies
when three requirements are met:
(1) The plea of collateral estoppel must be
asserted against a party or one in privity with a party to the
(2) The issue to be precluded from
relitigation by operation of the doctrine must be identical to that
decided in the first action;
(3) The issue in the first action must have
been resolved by a final judgment on the merits.[ [Fn. 6]]
This case does not meet the first of the above requirements. Hale
was not a party or in privity with a party in the Zeiler case.
Therefore collateral estoppel does not bar Hale from contending
that the regulation was not inconsistent with AS 43.23.015(a).
For the above reasons the judgment of the superior court
This language was enacted in 1992. In accordance with the
tenor of this enactment a regulation was promulgated effective
January 1, 1993, as follows: "The fact that an individual's spouse
has not declared Alaska residency does not establish a presumption
that an individual is not a resident." 15 AAC 23.143(j).
The superior court stated, in part:
The present case is distinguishable [from
Zeiler] because both Hale and her spouse were
Alaska residents when they left the state. Under these
circumstances, 15 AAC 23.163(c)(15) does not require finding of
ineligibility based solely on the residency of the spouse; rather,
the regulation retains Hale's eligibility and leaves the State free
to evaluate her residency and eligibility based on all of the
evidence in the record. This interpretation does no offense to AS
43.23.015(a) and makes invalidation of the regulation unnecessary.
See AS 43.23.095(8)(C).
15 AAC 23.163(c)(15).
Though this may seem like hairsplitting, the legislature has
invited this fine distinction. In amending AS 43.23.015 the
legislature considered and rejected language which stated that "the
residency of the individual's spouse may not be the only factor
relied upon"(Committee Substitute for Senate Bill 327, 17th Leg.
2d Sess. (1992) (emphasis added)) and that "the residency of the
individual's spouse may not be a factor relied upon,"(1992 House
Journal 2752 (emphasis added)) before eventually settling on the
current "principal factor"terminology (1992 House Journal 2759).
State v. United Cook Inlet Drift Ass'n, 895 P.2d 947, 950-51