Opinion
No. COA11–1425.
2012-05-1
Mildred E. HERSHNER, Petitioner, v. EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, North Carolina Department of Administration, and North Carolina Human Relations Commission, Respondents.
Mildred E. Hershner, pro se, petitioner appellant. Chief Counsel Thomas H. Hodges, Jr., by Regina S. Adams, for North Carolina Department of Commerce, Division of Employment Security, respondent appellees.
Appeal by petitioner from judgment entered 1 July 2011 by Judge Abraham Penn Jones in Wake County Superior Court. Heard in the Court of Appeals 20 March 2012. Mildred E. Hershner, pro se, petitioner appellant. Chief Counsel Thomas H. Hodges, Jr., by Regina S. Adams, for North Carolina Department of Commerce, Division of Employment Security, respondent appellees.
McCULLOUGH, Judge.
Mildred E. Hershner (“petitioner”) appeals from a judgment entered by the superior court affirming the opinion of the Employment Security Commission of North Carolina (“the Commission”) finding and concluding that petitioner was discharged from her employment with the North Carolina Human Relations Commission (“NCHRC”), an agency within the Department of Administration (“DOA”), for substantial fault connected with her work and that she should be disqualified from receiving unemployment insurance benefits for a period of nine weeks. We affirm.
I. Background
Petitioner began working for NCHRC as a staff attorney on 15 June 2005. On 24 August 2009, petitioner was terminated from her position with NCHRC.
Following her discharge, petitioner filed a claim with the Commission, effective 4 October 2009, seeking unemployment insurance benefits. On 20 November 2009, an adjudicator issued an initial determination ruling that petitioner was not discharged for misconduct or substantial fault connected with her work and therefore was not disqualified for unemployment insurance benefits. NCHRC appealed the adjudicator's ruling.
On 4 January 2010, a telephone evidentiary hearing was held by Hearing Officer Thomas Bolch. On 13 January 2010, the Hearing Officer issued an appeals decision concluding that petitioner was discharged for substantial fault not rising to the level of misconduct and disqualifying petitioner from unemployment insurance benefits for a period of four weeks, given certain mitigating circumstances found by the Hearing Officer. Petitioner appealed the Hearing Officer's decision to the Commission, and on 9 April 2010, the Commission modified the Hearing Officer's decision by disqualifying petitioner from unemployment insurance benefits for a period of nine weeks, finding no mitigating circumstances. On 7 May 2010, petitioner petitioned the superior court for judicial review of the Commission's decision.
On 1 July 2011, the superior court entered judgment affirming the Commission's decision. From that judgment, petitioner timely appealed to this Court.
II. Standard of Review
Section 96–15 of our General Statutes “outlines the standard procedure for claims for [unemployment insurance] benefits, appeals within [the] ESC-agency, and appeals from the ESC-agency final decision to Superior Court.” Employment Security Commission v. Peace, 341 N.C. 716, 718, 462 S.E.2d 222, 223 (1995). Pursuant to this statute:
(1) [A] decision will be made by an adjudicator, N.C.G.S. § 96–15(b)(2) [2011]; (2) the adjudicator's decision may be appealed to an appeals referee, N.C.G.S. § 96–15(c); (3) ... the Commission or a Deputy Commissioner may affirm, modify, or set aside the decision of the appeals referee, N.C.G.S. § 96–15(e); and (4) an appeal to the Superior Court is available after exhaustion of the remedies set out above, N.C.G.S. § 96–15(h).
Id. Under N.C. Gen.Stat. § 96–15(h), a petition for judicial review in superior court “shall explicitly state what exceptions are taken to the decision or procedure of the [Commission] and what relief the petitioner seeks.” Id. “Superior Court jurisdiction is limited to exceptions and issues set out in the petition.” Reeves v. Yellow Transp., Inc., 170 N.C.App. 610, 614, 613 S.E .2d 350, 353 (2005).
In reviewing decisions by the Commission, the standard of review in the superior court “is based solely upon G.S. 96–15(i).” In re Enoch, 36 N.C.App. 255, 256, 243 S.E.2d 388, 389 (1978). Pursuant to that statute: “In any judicial proceeding under this section, the findings of fact by the [Commission], if there is any competent evidence to support them and in the absence of fraud, shall be conclusive, and the jurisdiction of the court shall be confined to questions of law.” N.C. Gen.Stat. § 96–15(i) (2011).
The legislature, in granting this jurisdiction to the superior court, intended for the superior court to function as an appellate court. The function of the superior court in reviewing a decision of the Employment Security Commission is twofold: “(1) To determine whether there was evidence before the Commission to support its findings of fact; and (2) to decide whether the facts found sustain the conclusions of law and the resultant decision of the Commission.”
Enoch, 36 N.C.App. at 256–57, 243 S.E.2d at 389–90 (quoting Employment Security Comm. v. Jarrell, 231 N.C. 381, 384, 57 S.E.2d 403, 405 (1950)).
This same standard of review applies to this Court's review of the superior court's judgment affirming or reversing the Commission's decision: “[T]his Court, like the superior court, will only review a decision by the [ESC] to determine whether the facts found by the Commission are supported by competent evidence and, if so, whether the findings support the conclusions of law.” Reeves, 170 N.C.App. at 614, 613 S.E.2d at 354 (second alteration in original) (internal quotation marks and citations omitted). “If the findings of fact made by the ESC are supported by competent evidence then they are conclusive on appeal. However, even if the findings of fact are not supported by the evidence, they are presumed to be correct if the petitioner fails to except.” Fair v. St. Joseph's Hospital, Inc., 113 N.C.App. 159, 161, 437 S.E.2d 875, 876 (1993) (citation omitted).
“[T]he same principles governing the scope of judicial review on appeals from the Industrial Commission govern the scope of judicial review on appeal from the Employment Security Commission.” Enoch, 36 N.C.App. at 257, 243 S.E.2d at 390. In passing upon issues of fact in cases involving contested claims for unemployment insurance benefits, the Commission, as trier of fact, is the sole judge of the credibility of the witnesses, and of the weight to be given to their testimony. Vaughn v. Insulating Servs., 165 N.C.App. 469, 472, 598 S.E.2d 629, 631 (2004). “ ‘This being true, [the Commission] may accept or reject the testimony of a witness, either in whole or in part, depending solely upon whether it believes or disbelieves the same.’ “ Cooper v. BHT Enters., 195 N.C.App. 363, 369, 672 S.E.2d 748, 754 (2009) (alteration in original) (quoting Anderson v. Northwestern Motor Co., 233 N.C. 372, 376, 64 S.E.2d 265, 268 (1951)).
III. Discussion
A. Fraud
We first address petitioner's implications of fraud by the Commission in the handling of her case. Although petitioner does not specifically allege fraud in her case, she indicates the Commission mishandled certain evidence submitted by her to be considered at the evidentiary hearing. Petitioner further states she submitted evidence omitted from the record by the Commission for consideration by the superior court on judicial review. Petitioner argues her evidence again was not considered by the superior court, and that such mishandling of her evidence is a deviation from due process and fairness.
We note, however, that petitioner bears the responsibility of ensuring that her own evidence is properly received by the Commission and included in the record. Although petitioner argues she submitted documentary evidence for consideration by the Hearing Officer prior to the evidentiary hearing, the transcript reveals the Hearing Officer plainly informed the parties that “[it is] important that you present all relevant evidence during the hearing because any appeal will be limited to a review of the tape-recording of the hearing and the documentary evidence in the file.” Although the Hearing Officer asked petitioner if she was “satisfied with the testimony and the documents” at the conclusion of the hearing, it was petitioner's responsibility to clarify that the “documents” being referred to did, in fact, include all the items she had submitted. Petitioner made no effort during the hearing to identify her documents on the record or even ask the Hearing Officer if her documents were in fact received by the Commission before the hearing. Petitioner's assumptions about the Hearing Officer's use of the word “documents” does not equate to a mishandling of her evidence by the Commission, nor does it amount to fraud.
Petitioner cites Black's Law Dictionary for the definition of “fraud,” meaning “intentionally deceiving another person and causing her to suffer a loss.” Even under this definition provided by petitioner, as she appears to acknowledge, there is absolutely nothing in the record to indicate that the Hearing Officer's use of the word “documents” was intended to deceive petitioner into believing her documents were admitted into evidence when obviously they had not been.
Although petitioner attributes this definition to Black's Law Dictionary, she has provided no citation to any edition of Black's Law Dictionary containing this precise definition. Nonetheless, similar definitions are provided in the most recent editions of Black's Law Dictionary. See, e.g., Black's Law Dictionary 685 (8th ed.2008) (defining “fraud” as “[a] knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment”).
Further, it is well-settled that “the superior court cannot consider evidence from ‘outside the record brought before it on appeal[.]’ “ Edgecombe Dept. of Social Servs. v. Hickman, ––– N .C.App. ––––, ––––, 712 S.E.2d 209, 212 (2011) (quoting Enoch, 36 N.C.App. at 257, 243 S.E.2d at 390). Thus, the superior court properly declined to consider any evidence submitted by petitioner that was not already included in the record. Petitioner's insinuations of fraud by the Commission and the superior court in handling her evidence are without merit.
B. Findings of Fact
We next address petitioner's challenge to the Commission's findings of fact. In the present case, the Commission made the following finding of fact:
3. The [petitioner] was discharged from employment for insubordination for failure to work solely on a North Carolina Court of Appeals brief as instructed by her supervisor, for informing a client of the contents of her performance appraisal and appeal of the appraisal, and for violation of the employer's customary practice by informing a client of her recommended decision on the client's case prior to issuance of the agency's determination.
In addition, the Commission made the following detailed findings of fact, which petitioner now challenges on appeal:
4. On or about June 14, 2007, the claimant received an unsatisfactory rating on her 2006–07 performance appraisal. On July 25, 2007, the appraisal was revised to replace the “below good” ratings with “good ratings.” The claimant appealed both performance appraisals on June 15, 2007 and July 31, 2007. The claimant's appeal letters and performance appraisal contained confidential information. The claimant shared the contents of her “below good” performance appraisal and appeal letter to a client for the purpose of having the client write a letter in support of claimant's appeal of the performance appraisal. The claimant's appeal letter and performance appraisal were later attached to a legal document filed by the client in a federal court proceeding without the claimant's permission. The employer determined that the claimant's action of giving confidential information to the client was conduct unbecoming a State employee that was detrimental to State service.
5. The employer's customary practice prohibited the claimant from informing a client of the agency's recommended decision prior to issuance of the agency's determination. The claimant violated this known customary practice by informing a client that she was going to write up a “cause” determination in the client's case pending review by Richard Boulden, the agency's counsel. At the time that the claimant informed the client of her proposed determination, the agency had not made a final determination in the client's case. The agency later issued a determination of “no cause” with regards to the client's case.
6. June 11, 2008, the claimant received a final written warning for unacceptable personal conduct for insubordination. The disciplinary action was the result of the claimant's continued conversation with a client after instructions from the employer not to converse with the client. The claimant was instructed to refer the client to Richard Boulden, the claimant's supervisor/agency's counsel, concerning the client's complaints and accusations regarding her case.
7. The final incident that led to the claimant's discharge was due to insubordination. Boulden instructed the claimant to “drop everything” and write the draft for a brief for a case that was filed in the North Carolina Court of Appeals. When the claimant informed Boulden that she wanted to complete work on the Amini determination, Boulden informed the claimant to cease work on the determination and work on the Court of Appeals brief. The claimant continued to work on the determination because she believed that she could complete the determination in three (3) days. The claimant did not inform Bouldon that she was continuing to work on the determination. As of July 22, 2009, approximately 13 days after Bouldon's instructions, the claimant had not begun writing the Court of Appeals brief. The employer had to hire outside counsel to complete the brief after the claimant's discharge from employment.
Despite her challenges to the above findings, petitioner did not specifically except to any of these findings in her petition for judicial review to the superior court. In her petition for judicial review to the superior court, petitioner does appear to challenge some of the findings of fact made by the Hearing Officer in his determination; however, those findings of fact are not the proper topic of review by the superior court, which is limited to a review of the Commission's order and the findings of fact contained therein.
In her petition for judicial review to the superior court, as in her brief to this Court, petitioner simply contends that her evidence was omitted from the Commission's findings of fact, that her evidence is competent evidence supporting a finding that none of her actions were a violation of her job duties, and that the Commission's findings of fact therefore did not conform to the “true and complete” evidence. However, to the extent petitioner argues throughout her brief that the Commission failed to consider her evidence or enter findings of fact based on her evidence, or that the evidence she presented at the hearing supports alternative findings of fact than those found by the Commission, we remind petitioner that neither this Court nor the superior court on judicial review may reweigh the evidence and alter the findings of fact. Fair, 113 N.C.App. at 161, 437 S.E.2d at 876. As we have already noted, “as the sole judge of witness credibility and the weight to be given to witness testimony, the Commission may believe all or a part or none of any witness's testimony. The Commission is not required to accept the testimony of a witness, even if the testimony is uncontradicted.” Carey v. Norment Sec. Indus., 194 N.C.App. 97, 104, 669 S.E.2d 1, 6 (2008) (internal quotation marks and citations omitted)). We note that the Commission's nonacceptance of petitioner's evidence does not equate to a lack of consideration of such evidence.
Thus, having failed to properly except to any of the Commission's findings of fact in her petition for judicial review to the superior court, the Commission's findings of fact, as denoted above, are presumed to be correct and are binding on this Court's review. Reeves, 170 N.C.App. at 616, 613 S.E.2d at 354. We note also that, even had petitioner properly excepted to the Commission's findings of fact, a review of the transcript of the hearing in this case reveals testimony by both John Campbell and Richard Boulden supporting each of the challenged findings of fact made by the Commission in their entirety. Such testimony is competent evidence supporting the Commission's findings of fact, therefore rendering them “conclusive on appeal ..., even though there be evidence that would support findings to the contrary.” Carey, 194 N.C.App. at 104, 669 S.E.2d at 5 (internal quotation marks and citation omitted). Accordingly, because the Commission's findings of fact are conclusive and binding on appeal, we evaluate petitioner's remaining argument, that those findings of fact do not support a conclusion that petitioner was terminated for “substantial fault,” as defined under our General Statutes.
C. Conclusion of Law: Substantial Fault
Section 96–14(2a) of our General Statutes “provides that an individual shall be disqualified for benefits for a period of four to thirteen weeks if her discharge from employment is due to ‘substantial fault on [her] part connected with [her] work not rising to the level of misconduct.’ “ Lindsey v. Qualex, Inc., 103 N.C.App. 585, 589, 406 S.E.2d 609, 612 (1991) (alterations in original) (quoting N.C. Gen.Stat. § 96–14(2a)).
Substantial fault is defined to include those acts or omissions of employees over which they exercised reasonable control and which violate reasonable requirements of the job but shall not include (1) minor infractions of rules unless such infractions are repeated after a warning was received by the employee, (2) inadvertent mistakes made by the employee, nor (3) failures to perform work because of insufficient skill, ability, or equipment.
N.C. Gen.Stat. § 96–14(2a) (2011).
“An employee has ‘reasonable control’ when she has the physical and mental ability to conform her conduct to her employer's job requirements.” Lindsey, 103 N.C.App. at 590, 406 S.E.2d at 612.
What constitutes “reasonable requirements of the job” will vary depending on the nature of the employer's business and the employee's function within that business.... The reasonableness of the employer's job requirements should be analyzed on a case-by-case basis in light of the totality of the circumstances surrounding the employee's function within the employer's business.
Id. “The essence of G.S. § 96–14(2[a] ) is that if an employer establishes a reasonable job policy to which an employee can conform, her failure to do so constitutes substantial fault.” Id.
In the present case, petitioner does not dispute that she had the physical and mental ability to conform her conduct to her employer's job requirements. Rather, petitioner's argument appears to address whether the alleged incidents of insubordination found by the Commission were violations of reasonable job requirements. Petitioner first argues she expected to be able to use her professional judgment on time management and work on more than one case at a time without being micromanaged by her supervisor. Petitioner contends that her supervisor's direction to drop everything and work solely on the appellate brief, reflected in Finding of Fact seven, was therefore unreasonable. Although petitioner may have expected to be able to complete the appellate brief in a timely manner while simultaneously continuing to work on another case, the fact remains that she failed to follow the direct order of her supervisor to begin drafting the brief. Such “action in refusing to proceed with her work as instructed” has previously been found by this Court to constitute misconduct. See Phillips v.. Kincaid Furniture Co., 67 N.C.App. 329, 332, 313 S.E.2d 19, 21 (1984). Such insubordinate action certainly shows petitioner's failure to conform her conduct to a reasonable requirement of her job.
Petitioner next argues that NCHRC failed to establish the existence of any rule prohibiting employees from sharing their performance appraisal with others. However, petitioner's argument is misguided, as the Commission found petitioner's conduct to be detrimental to State service because she allowed confidential information to be shared with a member of the public, not because she violated some rule against sharing her performance appraisal with others. If petitioner felt compelled to share her performance appraisal with others, she could have simply redacted the confidential information. As to disclosing the confidential information, petitioner argues she was justified in releasing any purported confidential information in order to defend herself against her supervisor's negative performance appraisal. Petitioner contends that she may properly divulge confidential information to defend herself in a controversy between her and her employer pursuant to Rule 1.6(b)(6) of the Revised Rules of Professional Conduct. Nonetheless, petitioner neglects that such disclosures are only permissible “to the extent the lawyer reasonably believes [is] necessary.” Revised Rules of Professional Conduct, Rule 1.6(b) (2012) (emphasis added). Petitioner fails to explain any reason why the disclosure of such confidential information aided in her defense against her employer's negative performance appraisal. In fact, petitioner presented numerous letters from individuals in support of her job performance, none of which were procured by revealing such confidential information.
Finally, petitioner argues she was not aware of her employer's policy against communicating decisions with a complainant, and that, in any event, such infraction would constitute a “minor infraction” which does not support a conclusion of substantial fault. Even if this action, reflected in Finding of Fact five, constituted a “minor infraction” of her employer's rules in isolation, considering the totality of the circumstances, the infraction nonetheless supports the Commission's conclusion of substantial fault. The action of improperly communicating the agency's recommended decision to a client prior to issuance of the agency's decision constituted the first act of insubordination by petitioner reflected in the Commission's findings of fact. Petitioner's continued communication with a complainant after instructions not to so communicate, reflected in Finding of Fact six, constituted the second incident of alleged insubordination by petitioner to her supervisor. Petitioner acknowledges she not only communicated with the complainant at issue once after being directed not to, but at least three conversations occurred between petitioner and the complainant. Thereafter, petitioner “received a final written warning for unacceptable personal conduct for insubordination.” Petitioner admits in her brief that she did, in fact, receive such a warning. Following the written warning, petitioner again was insubordinate to her supervisor by failing to follow his direct order to work solely on the appellate brief. Thus, even if one such action could be classified as a “minor” rules violation, petitioner was insubordinate, even after receiving a final written warning. Such repeated insubordination supports a conclusion by the Commission that petitioner was discharged for substantial fault connected with her work. See Boyland v. Southern Structures, Inc., 172 N.C.App. 108, 115, 615 S.E.2d 919, 924 (2005) (“[T]o support a conclusion of law that an employee is substantially at fault for minor rule infractions, [the Commission] must enter specific findings of fact that (1) the employer warned the employee that [her] actions were in violation of the rules, and (2) the employee violated the rules again after having been warned.”).
Petitioner is correct that N.C. Gen.Stat. § 96–14(2a) “is ‘to be strictly construed in favor of the claimant, and the employer has the burden of proving that the claimant is disqualified.’ “ Boyland, 172 N.C.App. at 115, 615 S.E.2d at 924 (quoting In re Dept. of Crime Control and Public Safety v. Featherston, 96 N.C.App. 102, 104, 384 S.E.2d 306, 308 (1989)). Despite petitioner's attempts to justify her job performance on appeal, however, the Commission's findings of fact, supported by competent evidence in the record, support its conclusion that petitioner was discharged for substantial fault connected with her work. Findings of Fact four through seven, denoted supra, establish that petitioner was repeatedly insubordinate to her supervisor in that she divulged confidential information to a complainant of her employer without considering the possible consequences of such disclosure, violated a known policy of communicating with NCHRC complainants about a determination in their case prior to the issuance of an agency determination, repeatedly communicated with a complainant after being directed not to so communicate, and failed to work on an appellate brief after repeatedly being instructed to focus solely on the brief by her supervisor. NCHRC's job requirements not to disclose confidential information, not to communicate with complainants following the termination of their cases, not to discuss a complainant's case determination with the complainant prior to the issuance of the agency determination, and petitioner's supervisor's instructions to work on an urgent matter are all reasonable directives under the circumstances, especially given that petitioner is an employee of a State agency working with the public. Because these job requirements were reasonable and within petitioner's control, the Commission properly concluded petitioner was terminated for substantial fault, and the trial court did not err in affirming the Commission's order.
Finally, although respondents ask this Court to dismiss petitioner's appeal, strike petitioner's brief, and sanction petitioner for violation of Rule 28(b)(5) of the North Carolina Rules of Appellate Procedure, we deny respondents' request in light of this opinion. We acknowledge petitioner may not have been fully compliant with the Rule. Nonetheless, in light of our Supreme Court's opinion in Dogwood Dev. & Mgmt. Co., LLC v. White Oak Transp. Co., 362 N.C. 191, 657 S.E.2d 361 (2008), the issues raised by petitioner in this appeal are best addressed directly on the merits. Id. at 198–99, 657 S.E.2d at 365–66 (holding “Rule 28(b), which governs the content of the appellant's brief,” is a “nonjurisdictional requisite[ ] prescribed by the appellate rules” such that noncompliance “normally should not lead to dismissal of the appeal. ... [T]he appellate court may not consider sanctions of any sort when a party's noncompliance with nonjurisdictional requirements of the rules does not rise to the level of a ‘substantial failure’ or ‘gross violation.’ In such instances, the appellate court should simply perform its core function of reviewing the merits of the appeal to the extent possible.”).
IV. Conclusion
We hold the superior court properly affirmed the Commission's determination concluding petitioner was discharged from her employment for substantial fault and was therefore disqualified from receiving unemployment insurance benefits for a period of nine weeks. Because petitioner did not properly except to any of the Commission's findings of fact in her petition for judicial review to the superior court, the Commission's findings of fact are presumed supported by competent evidence and are conclusive and binding on appeal to both the superior court and this Court. Further, the Commission's findings of fact regarding petitioner's continued insubordination support its conclusion of law that petitioner was terminated for substantial fault connected with her work.
In addition, we discern no fraud on the part of the Commission in petitioner's case, and we deny respondents' request to dismiss petitioner's appeal, strike petitioner's brief, and sanction petitioner for violation of the appellate rules. The judgment of the superior court affirming the Commission's determination is therefore affirmed.
Affirmed. Judges McGEE and GEER concur.
Report per Rule 30(e).