IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
PAL of WILMINGTON, )
Appellant, )
v. )
CAROL GRAHAM, Claimant, and )
UNEMPLOYMENT INSURANCE )
APPEAL BOARD, )
Appellees. )
Date Submitted: March 3, 2008
Date Decided: June 18, 2008
OPINION
Upon Appeal of the Decision of the Industrial Accident Board.
AFFIRMED.
I. Introduction
Plaintiff appeals the decision of the Unemployment Insurance Appeal
Board denying its request for a rehearing and granting Claimant
unemployment benefits. For the reasons set forth below, the Court finds that
the Board’s decision to grant Claimant unemployment benefits is supported
by substantial evidence and that the Board did not abuse its discretion when
it denied Plaintiff’s request for a rehearing. Accordingly, the Board’s
decision is AFFIRMED.
II. Statement of Facts
In April 2004, Claimant Carol Graham ("Graham") began working as
an administrator for Plaintiff, the Police Athletic League of Wilmington
("PALW"). In December 2005, Graham accepted the position of Director of
Programs with PALW. PALW advised her that it would review her
performance in the first three months of employment. On April 5, 2006,
Velda Jones-Potter, the president of the board of directors, presented
Graham with her evaluation. According to the evaluation, Graham
demonstrated deficiencies in areas essential to her role as Director of
Programs. To address her deficient work performance, PALW created a
sixty day performance plan, which included a reevaluation of Graham’s
progress after the first thirty days. The objective of the plan was "to present
again to [Graham] the tasks for which she is responsible, evaluate progress
toward successful completion of these tasks, and determine what, if any, role
[Graham] shall have in the PALW organization going forward" for the
period of January through March 2006.1 During that time, Graham was to
"provide a weekly written status of her work and shall meet weekly with the
Executive Director to review progress with these assignments."2 At the end
of the first thirty days, Graham’s performance was to be "reviewed, at which
time PALW [would] take corrective action if necessary up to and including
termination."3
Before implementing the plan, PALW asked Graham to sign it.
Graham refused to sign and submitted her voluntary resignation on April 6,
2006. Graham interpreted the plan as "an ultimatum,"4 and refused to
participate because the plan addressed her duties in her previous
administrative position, rather than in her current position.5 Although
PALW accepted her resignation on April 7, 2006, Sylvia Lewis-Harris
("Lewis-Harris") responded on behalf of PALW, and rebutted Grahams’s
allegations that she was told to either sign a corrective action plan or resign.
Lewis-Harris, who was Graham’s supervisor at the time, wrote:
We received your voluntary resignation letter on April 6, 2006.
That letter is, however, false and misleading. In the meeting on
April 5, you were never asked for your resignation. Mrs. Potter
and I documented and reviewed the history of your
performance, a sixty-day work plan, and the process for
monitoring your performance going forward. You voiced
disagreement with some aspects of the performance assessment,
which you also documented. We acknowledged your right to
disagree with the assessment and accepted the document as
submitted.
There was no ultimatum given. Mrs. Potter and I explained that
the only requirement was that you perform the job for which
you would be compensated. These requirements were detailed
in the sixty-day work plan. The option to resign, if you were
not in agreement with the work plan was discussed. You
indicated that you were unwilling to agree to follow the work
plan and that you preferred to voluntarily resign your position.6
On August 18, 2006, Graham filed for unemployment benefits. On
September 25, 2006, the Claims Deputy held that Graham was qualified to
receive unemployment benefits. PALW timely appealed that decision to the
Appeals Referee. After holding a hearing on December 18, 2006, the
Appeals Referee reversed the decision of the Claims Deputy. The Referee
determined that "[t]here was no evidence that this is the case of resignation
in lieu of discharge."7 The Referee found that Graham resigned without
good cause, noting that she "voluntarily resigned her position because she
did not agree with the evaluation and did not wish to sign for the evaluation
and the performance plan."8 She concluded:
The employer was reasonable in its expectation that the
claimant would adhere to the proposed performance plan. Part
of being an employee is accepting coaching and criticism from
the employer. Employees may not always agree with an
employer’s evaluation of their job performance but disagreeing
with the evaluation does not give an employee the recourse of
leaving gainful employment to join the ranks of the
unemployed. . . . The claimant’s unemployment is the result of
his own choice and his own doing.9
Graham appealed the Referee’s decision to the Unemployment
Insurance Appeal Board (the "Board") on December 29, 2006. Due notice
was sent to both parties that a hearing was scheduled for February 14, 2007.
On February 6, 2007, PALW requested that the hearing date be changed.
The Board granted PALW’s request and rescheduled the hearing to February
28, 2007. The Board sent notice to PALW and its counsel on February 12,
2007.
Neither PALW nor its counsel was in attendance at the hearing held
on February 28, 2007. Upon questioning by the Board, the Board Secretary
stated that she sent PALW and its counsel notice stating that the hearing had
been rescheduled to February 28, 2007.10 Both PALW and its counsel,
however, contend that they were not notified of the new date. Although the
Board records indicate that notice was sent to the attention of Lewis-Harris
for PALW, there is no documentary evidence that notice was sent to
counsel. PALW also claims that it never received the notice. No mail,
however, was returned to the Department of Labor as undelivered.11
The Board went forward with the hearing despite PALW’s absence.
At the hearing, Lewis-Harris, who had since been terminated by PALW,
testified on behalf of Graham. In contradiction to the letter she issued on
behalf of PALW, Lewis-Harris testified that Graham was given an
ultimatum to sign the evaluation.12 Based on this new evidence, the Board
found that Graham was induced to resign under pressure and qualified for
benefits. Notably, the Board determined that "[t]he wording of the
performance plan, without any other evidence, would be sufficient to lead to
[sic] Board to the conclusion that the claimant was being given an ultimatum
and was threaten [sic] with future action that all but guaranteed her
termination."13 It also determined that the plan "certainly tends to contradict
the testimony of the board president before the Referee[.]"14 The Board
concluded that PALW’s decision to evaluate Graham with a sixty day
performance plan, which included a mandatory reevaluation after the first
thirty days, "speaks for itself, and . . . was clearly an ultimatum, which at
least implied the intention to terminate the claimant at the end of 30 days."1516
PALW requested a rehearing on April 5, 2007, five days before the
Board’s decision became final on April 10, 2007. On April 27, 2007, the
Board denied PALW’s request for a rehearing because the Board found that
PALW’s failure to appear was not the result of a departmental error or
extraordinary circumstance. In its decision, the Board noted that "notice was
sent to both the Employer and Employer’s counsel."17 PALW then filed the
instant appeal to this Court.
III. Parties’ Contentions
PALW raises three arguments on appeal. First, PALW submits that
the Board abused its discretion when it refused to hold a rehearing because
neither PALW nor its counsel received the twenty-day notice required by 29
Del. C. § 10122. In support of this argument, PALW contends that (1)
Lewis-Harris admitted at the hearing that she did not receive notice for
PALW; (2) there is no evidence that either counsel or PALW received notice
of the February 28, 2007 hearing date; (3) the Board knew that PALW was
represented by counsel who had appeared at all prior hearings; and (4) the
Board’s decision to rely on testimony from the Board Secretary that notice
was sent is legally insufficient. Second, PALW submits that the Board’s
decision that Graham was qualified for unemployment benefits was not
based on substantial evidence because (1) Graham testified that she
voluntarily resigned; (2) there was no evidence showing PALW intended to
terminate Graham; and (3) the Board’s decision that Lewis-Harris was
credible failed to consider her motive to lie and her letter in which she
rebutted Graham’s assertion of an ultimatum. Finally, PALW argues that
the Board committed an error of law because it applied the improper
"constructive discharge" legal standard, rather than the appropriate
"voluntary quit" standard.
In response, the Board contends that it must only give parties five-
days’ notice under Division of Unemployment Insurance Regulation 19 and
is not subject to the twenty-day requirement of 29 Del. C. § 10122. The
Board further submits that, despite a lack of documentary evidence
establishing that notice was sent to PALW and counsel, the testimony of the
Board Secretary and the presumption that mail sent to the correct address is
received is sufficient to establish that PALW received notice of the new
hearing date. Thus, the Board did not abuse its discretion in denying
PALW’s request for a rehearing. The Board makes no arguments as to the
substantive finding that Graham is qualified for benefits. Similarly, Graham
did not file a brief in response to PALW’s contentions.
IV. Standard of Review
This Court’s appellate review of a Board decision is limited. In
reviewing the decisions of the Board, this Court must determine whether its
findings and conclusions are "free from legal error and supported by
substantial evidence in the record."18 Substantial evidence means "such
relevant evidence as a reasonable mind might accept as adequate to support
a conclusion."19 The "substantial evidence" standard means "more than a
scintilla but less than a preponderance of the evidence."20 The Court "does
not weigh the evidence, determine questions of credibility, or make its own
factual findings."21
A discretionary decision of the Board will be upheld absent an abuse
of discretion.22 An abuse of discretion occurs when the Board "acts
arbitrarily or capriciously"23 or "exceeds the bounds of reason in view of the
circumstances and has ignored recognized rules of law or practice so as to
produce injustice."24 The Court reviews questions of law de novo to
determine "whether the Board erred in formulating or applying legal
precepts."25
Where a party requests a rehearing, the Board has discretion to
consider whether to reopen a case where no valid appeal has been filed by
either party.26 The Board will only revisit a decision "where there has been
some administrative error on the part of the Department of Labor which
deprived the claimant of the opportunity to file a timely appeal, or in those
cases where the interest of justice would not be served by inaction."27
Absent an abuse of discretion, the Board’s decision must be affirmed.
V. Analysis
A. The Board did not Abuse its Discretion When it Refused to Hold a
Rehearing
Due process requires that a party have a full and fair opportunity to be
heard in its own defense.28 The procedural requirements and formality of
that opportunity vary depending on the circumstances.29 In the context of a
hearing before the Unemployment Insurance Appeal Board, the party whose
rights may be affected is entitled to notice and a hearing.30 Proper notice
requires that the party receive an adequate, proper and lawful notification of
the agency action that will affect its right in a meaningful time and
manner.31 Stated another way, due process requires that "the notice inform
the party of the time, place, and date of the hearing and the subject matter of
the proceedings."32 For example, in Turkey’s Inc. v. Peterson, the Court
held that due process was satisfied where an employer was notified of the
claimant’s application for benefits, her appeal, the hearings, the right to
subpoena witnesses, and the right to retain counsel if so desired.33 For
purposes of sending notice of an appeal to the Unemployment Insurance
Appeal Board, Delaware Division of Unemployment Insurance Regulation
Number 19, rather than 29 Del. C. § 10122, governs the timing of notice.34
Regulation 19 requires that the Board mail the parties notice at least five
days before the hearing.35
Due process requirements are fulfilled when they are "accomplished
by a method reasonably calculated to afford the party an opportunity to be
heard."36 For notice to be effective, it must be received.37 In Delaware,
notice that is correctly addressed, stamped and mailed is presumed to have
been received by the party to whom it was addressed.38 Lack of evidence of
any mailing error by the Department of Labor supports the presumption that
properly mailed and addressed mail was received.39 For example, in the
case of Reagan National Advertising, Inc. v. Unemployment Insurance
Appeal Board, the Court held that direct testimony from the claims deputy
that she mailed notice was sufficient, despite any documentary evidence of
mailing, to establish that notice was sent to the p
This presumption may be rebutted, however, by evidence that notice
was never received.41 Only where there is evidence that the Board was at
fault for a misdelivery will a party’s right to due process be violated.42 In
contrast, if notice is properly addressed by the agency and not received
because of some fault of the party to whom it was addressed, the notice may
still be deemed sufficient even if the party did not receive it.43 A party’s
right to due process will not be violated where notice was not received as a
result of the party’s failure to inform the agency of her correct address.44
In this case, the Board did not abuse its discretion in refusing to grant
PALW a rehearing. At the hearing, the Board’s Secretary testified that she
mailed notice to both PALW and its counsel. In fact, PALW does not
dispute that the Department of Labor sent notice to its office.45 Due process
only requires that the party in interest receive notice by "a method
reasonably calculated to afford the party an opportunity to be heard."46
Here, a method reasonably calculated to afford PALW a chance to appear
before the Board was employed. The agency sent properly mailed and
stamped notice to PALW’s address on file. That is sufficient to afford
PALW due process.
PALW contends that it never received notice because Lewis-Harris
testified that she did not receive the notice. PALW, however, misconstrues
the requirements of due process. That Lewis-Harris did not receive the
notice because she was no longer employed with PALW is immaterial.
PALW, as the true party in interest, had a duty to not only inform the
Department of Labor that Lewis-Harris was no longer employed with the
organization, but also to inform counsel of the change in the hearing date.47
Moreover, PALW’s failure to inform the Department of Labor of Lewis-
Harris’s termination is not a departmental error. There is no evidence of
"misdelivery" or that PALW’s failure to receive notice was the fault of the
Department of Labor. As a result, the Board had substantial evidence before
it to determine that PALW was sent notice.
The Court further notes that there is no requirement that counsel for a
party receive notice in the context of an agency hearing. Similarly, that the
Board knew that PALW was represented by counsel is not relevant as to
whether PALW received proper notice. Rather, due process requires that the
party receive notice of the hearing.48 Just as in Reagan National
Advertising, Inc., the Board had before it direct testimony that notice was
properly sent to both PALW and its counsel. Counsel for PALW has offered
no authority, nor can the Court find any, supporting its assertion that counsel
must also receive notice in the context of an agency hearing where it is
undisputed that the actual party in interest was sent proper notice. Because
PALW was sent proper notice of the new hearing date and the Board
Secretary testified that she sent notice to both PALW and its counsel, the
Board had sufficient evidence with which to find that appropriate notice was
sent.
PALW relies heavily on the case of Kostyshyn v. Unemployment
Insurance Appeal Board49 to argue that the Board abused its discretion. In
that case, the claimant sought to reopen the Board’s decision and testified
that he did not receive notice of the hearing. The Board found his testimony
to lack credibility and refused to reopen the decision. On appeal, this Court
reversed and found insufficient evidence to support the Board’s finding that
notice was sent:
Although it is within the province of the Appeal Board to
determine claimant's credibility, the record must nevertheless
show that notice was sent before it may be presumed that it was
received. The only things in the record on this are the statement
of the Board’s attorney that the notice was sent and a copy of a
notice which claimant testified that he received on the date of
the hearing on his motion to reopen. There was neither
testimony by the person who sent the notice nor explanation of
the procedure for sending notices that would support a finding
that the notice was sent.50
Kostyshyn is distinguishable from this case. Unlike Kostyshyn, the
Board’s Secretary testified that she sent proper notice to PALW. In fact, the
Board records indicate that notice was sent to PALW to the attention of
Sylvia Lewis-Harris.51 Although PALW stresses that there is no record of
how notice was sent, what procedures were followed, or whether postage
was prepaid, the Board Secretary testified that she mailed notice to PALW
and that notice was sent to PALW to the attention of Lewis-Harris. Notably,
the Board Secretary sent notice to the same address that she had sent prior
notices for the initial hearing, all of which were received.52 This evidence
demonstrates that the Board had sufficient evidence before it to conclude
that notice was sent properly. As a result, the Board’s decision to deny
PALW’s request for a rehearing was not an abuse of discretion.
B. The Board’s Decision is Supported by Substantial Evidence
PALW argues that the Board’s decision that Graham is entitled to
benefits is not supported by substantial evidence. Specifically, PALW
contends that Graham was not pressured to resign and resigned voluntarily.
Section 3314 of Title 19 of the Delaware Code provides that "[a]n
individual shall be disqualified for benefits: (1) [f]or the week in which the
individual left work voluntarily without good cause attributable to such work
. . . ." The employee has good cause to leave where the cause "would justify
one in voluntarily leaving the ranks of the employed and joining the ranks of
the unemployed."53 Good cause does not exist, however, merely because
the employer creates an undesirable situation.54 Rather, the employee must
first "do something akin to exhausting his administrative remedies" by, for
example, notifying the employer of the undesirable situation.55 Although
"voluntarily" means "proceeding from one’s own choice or full consent,"
Delaware courts have held that an employee does not leave voluntarily
where she was induced under pressure to leave her job.56 In such a case, the
employee’s resignation is "tantamount to a discharge . . . without just
cause", and the employee may receive benefits.57
In this case, the Board’s decision that Graham was induced under
pressure to resign is supported by substantial evidence. The Board first
determined that the evaluation plan crafted for Graham focused mostly on
her previous position as an administrator, rather than on her current position
as a program director.58 The Board held that the language of the plan
indicated that the document was "clearly an ultimatum, which at least
implied the intention to terminate the claimant at the end of 30 days."59 For
example, the plan was implemented to "determine what, if any, role Carol
shall have in the PALW organization going forward."60 Similarly, PALW
reserved the right to "take corrective action if necessary up to and including
termination."61 Even though PALW is correct that the Board’s decision
does not address the motive of Lewis-Harris or the discrepancy between her
testimony and the letter she authored while employed by PALW, the Board
stated that "[t]he wording of the performance plan, without any other
evidence, would be sufficient to lead the Board to the conclusion that the
claimant was being given an ultimatum and was threaten [sic] with future
action that all but guaranteed her termination."62 The Board further found
that the testimony of Lewis-Harris, who testified that Graham was given an
ultimatum, was credible. As a result, the Board had sufficient evidence
before it to find that Graham’s resignation was not voluntary.
PALW relies on Short v. Unemployment Insurance Appeal Board and
Phoenix Steel63 and Redding v. Medical Center of Delaware64 to argue that
Graham voluntarily quit and was not constructively discharged. In Short,
the claimant resigned from his employment after being laid off for one year.
While laid off, the claimant had the right to bid on other jobs with the
company, but it was unlikely that he could return to his former position. By
resigning, however, the claimant was able to receive $1,900.00 in severance
pay, even though he would lose the ability to bid on different positions. The
Court affirmed the Board’s decision that "the claimant was given a choice,
which he made on his own, without any inducement by the employer other
than monetary."65
In Redding, Redding’s employer wanted to demote her for deficient
performance. After Redding opposed the demotion, her employer offered
her a ninety-day evaluation period. Redding’s performance failed to
improve, and she was demoted to the only other available position in her
department. Because she refused to accept this position, her employer
informed her that she would be terminated. Instead, Redding chose to
resign. On appeal, this Court affirmed the Board’s decision that Redding did
not qualify for benefits because the employer’s offer to place Redding in a
position with fewer responsibilities did not induce her to resign.66
The holdings in Short and Redding do not persuade the Court that the
Board erred. In both Short and Redding, the claimants were given options
for different jobs within the organization rather than termination. Moreover,
in neither case did the employer’s actions suggest an intention to terminate
the claimant. In contrast, neither the evaluation plan nor the comments
made by Graham’s superiors present an option for Graham. Although
Graham was not explicitly forced to sign the evaluation plan, the wording of
the plan was laden with implicit threats that she would be terminated, rather
than reassigned. The language of the plan suggested, at least implicitly, that
Graham must either accept the new evaluation, which mainly addressed her
old position, or risk termination. This interpretation was supported by the
testimony of Lewis-Harris at the Board hearing. Graham "exhausted her
administrative remedies" by voicing disagreement with the plan and
documenting those disagreements.67 The Board correctly applied the proper
"constructive discharge" standard because there was substantial evidence
that Graham’s resignation was induced under pressure to resign. Thus, the
holdings in Short and Redding are unavailing.
Importantly, although PALW stresses that there was no explicit threat
to terminate Graham, that she chose to resign, and that the Board’s decision
failed to consider Lewis-Harris’s motive to lie, this Court cannot weigh the
evidence, make factual determinations, or weigh the credibility of witnesses.
Rather, this Court can only determine whether the Board’s decision is
supported by substantial evidence. In this case, the language of the
performance plan implied that Graham would be forced to resign if she did
not sign the plan, Graham’s testimony that she was threatened with a forced
resignation and the supporting testimony of Lewis-Harris, which the Board
found to be credible, is evidence adequate to support the Board’s decision.
As a result, the Board’s decision is supported by substantial evidence.
VI. Conclusion
The Court finds that the Board did not abuse its discretion when it
refused to reopen its March 30, 2007 decision because there was sufficient
evidence in the record to demonstrate that PALW was sent proper notice.
The Court also concludes that the Board’s decision finding Graham qualified
for benefits is supported by substantial evidence. According, the Board’s
decision is AFFIRMED.
IT IS SO ORDERED.
__________________________
Jan R. Jurden, Judge