Wallace v. State ex rel PERB

Plaintiffs must first exhaust their administrative remedies before seeking judicial relief.

Wallace was the holder of a PERS retirement account for about 15 years. Throughout this time, the State imposed restrictions and sanctions on Wallace’s fund transfer activity between options in his savings plan. Wallace argued that the restrictions were unlawful and unconstitutional; and brought an action under the Oregon Administrative Procedures Act (APA). While that action was pending, he also filed suit in state court. The trial court dismissed 6 of Wallace’s 7 claims for lack of jurisdiction. Wallace appealed, arguing that the dismissal was in error. The Court of Appeals ruled that where only declaratory relief has been sought, the claim must be exhausted administratively before the it may be addressed in a court. However, where the relief sought is compensatory, the court may abate the claim until administrative remedies have been exhausted. Therefore, Wallace’s 3 claims for compensatory relief should not have been dismissed for lack of jurisdiction. Reversed and remanded in part; affirmed in part.