NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING
MOTION AND, IF FILED, DETERMINED
IN THE DISTRICT COURT OF APPEAL
OF FLORIDA
SECOND DISTRICT
SUNSHINE CHEVROLET )
OLDSMOBILE, )
)
Appellant, )
)
v. ) Case No. 2D04-406
)
UNEMPLOYMENT APPEALS )
COMMISSION and ZAHID N. ROY, )
)
Appellees. )
________________________________ )
Opinion filed September 23, 2005.
Appeal from the Unemployment
Appeals Commission.
Gregory A. Hedaring of Thompson,
Sizemore & Gonzalez, Tampa,
for Appellant.
John D. Maher, Tallahassee,
for Appellee Unemployment Appeals
Commission.
No Appearance for Appellee
Zahid N. Roy.
CANADY, Judge.
Sunshine Chevrolet Oldsmobile appeals the order of the Unemployment
Appeals Commission (UAC) affirming the appeals referee's decision that Zahid N. Roy
was qualified for the receipt of unemployment benefits because he was not discharged
due to misconduct. We conclude that the referee and the UAC properly determined that
certain documentary evidence, which Sunshine offered without objection, constituted
hearsay and thus was not sufficient in itself to establish that Roy was guilty of
misconduct. We therefore affirm the decision that Roy was qualified for the receipt of
benefits.
Background
After Sunshine received complaints about Roy's work, Roy's comments
made around and about women, and his work attendance, Roy was discharged from
work by Sunshine allegedly due to racist and sexually inappropriate remarks, his job
performance, and his attendance. Roy applied for unemployment benefits, and his
application was granted by the claims examiner. Sunshine appealed the claims
examiner's decision. In the proceedings before the appeals referee, Sunshine was
represented by Jim Brakeman, vice president and chief financial officer of Sunshine,
who testified that he was responsible for human resources and was custodian of the
company's records. Roy did not appear at the proceeding. Prior to the hearing,
Sunshine had submitted a compilation of various documents relating to Roy with the
request that the documents be accepted "as evidence of misconduct by Mr. Roy." At
the hearing, Brakeman made reference to the documentary submission as "a pretty
thick document" that is "pretty complete with . . . a number of . . . observations about the
shortcomings of Mr. Roy's work." Brakeman did not, however, specifically proffer the
documents as records of regularly conducted business activity or provide any testimony
concerning the circumstances of the creation of the documents.
The appeals referee determined that Sunshine had failed to meet its
burden of showing that Roy's discharge was for misconduct connected with his work.
The referee based this determination on the fact that Sunshine "presented primarily
hearsay evidence." In affirming the referee's decision, the UAC noted that requirements
for the introduction of records of regularly conducted business activity were not satisfied
at the hearing and that "the referee properly discounted the hearsay evidence" on which
Sunshine relied.
Argument on Appeal
On appeal, Sunshine contends that the UAC failed to properly apply the
hearsay exception for records of regularly conducted business activity. Sunshine points
out that "the appeals referee did not consider whether the [documentary] evidence
would be admissible under the business record exception to the hearsay rule" and that
the referee accordingly did not "indicate that any of the fifty-six documents produced by
Sunshine were hearsay and/or inadmissible under the business record exception."
Sunshine also relies on Roy's failure to object to the documentary evidence. Sunshine
argues that "[m]any of the documents at issue constitute business records that fit within
the exception under section 90.803(6)[, Florida Statutes (2002)]." According to
Sunshine, the "records were introduced and explained by Sunshine's document
custodian" and many of them–such as evaluation notes, invoices, contemporaneous
memos, exit interview notes, and time sheets–"are clearly records that a company uses
as part of its regular course of business." Sunshine contends that "[i]f there was any
doubt" concerning the status of the records, "that issue could have been clarified if the
appeals referee had simply asked the [employer's representative] whether the
documents were created as part of the normal course of business."
The UAC argues that the referee correctly considered the documents to
be hearsay because they were not properly authenticated as records within the
business records exception to the hearsay rule. The UAC contends that such hearsay
evidence standing alone could not meet Sunshine's burden of proving that Roy was
discharged for misconduct connected with his work.
Analysis
Generally, in formal administrative proceedings all "evidence of a type
commonly relied upon by reasonably prudent persons in the conduct of their affairs [is]
admissible, whether or not such evidence would be admissible in a trial in the courts of
Florida." § 120.569(2)(g), Fla. Stat. (2002). An administrative action will be reversed on
appeal if the "action depends on any finding of fact that is not supported by competent,
substantial evidence in the record" of the administrative hearing. § 120.68(7)(b).
Section 120.57(1)(c) specifically provides that in administrative hearings "[h]earsay
evidence may be used for the purpose of supplementing or explaining other evidence,
but it shall not be sufficient in itself to support a finding unless it would be admissible
over objection in civil actions." See C F Chems., Inc. v. Fla. Dep't of Labor &
Employment Sec., 400 So. 2d 846, 848 (Fla. 2d DCA 1981).1
Florida Administrative Code Rule 60BB-5.024(3)(d) sets forth provisions
governing the receipt of evidence in hearings before unemployment compensation
appeals referees. The rule tracks the provisions of section 120.57(1)(c) regarding
hearsay evidence. The rule also provides:
A party or the party's representative may advise the appeals
referee of a defect in the character of any evidence
introduced by voicing an objection. The objecting party shall
be given an opportunity to explain the grounds for the
objection. Failure of a party to voice an objection to any
evidence introduced at the hearing shall not prevent the
party from raising the objection on appeal to the
Unemployment Appeals Commission.
Fla. Admin. Code R. 60BB-5.024(3)(d).
Section 90.803(6) sets forth the requirements for the hearsay rule
exception for records of regularly conducted business activity. Under the statutory
provisions, three conditions must be satisfied for a record to fall within the scope of the
exception. First, the record must be "of acts, events, conditions, opinion, or diagnosis,
made at or near the time by, or from information transmitted by, a person with
knowledge." Second, the record must be "kept in the course of a regularly conducted
business activity." Third, it must be "the regular practice of that business activity to
make such" records. The satisfaction of these requirements must be "shown by the
testimony of the custodian or other qualified witness" or by an appropriate written
certification or declaration. Even if the applicable requirements are all met, the hearsay
exception is not applicable if "the sources of information or other circumstances show
lack of trustworthiness."
In the instant case, it appears that certain of the documents submitted by
Sunshine might well have qualified as records of regularly conducted business activity
under section 90.803(6), which would have been "admissible over objection in civil
actions" and thus "sufficient in [themselves]" pursuant to section 120.57(1)(c) to support
a finding with respect to misconduct by Roy. But Sunshine simply failed to establish the
proper basis for the referee to consider the records as such evidence that would be
sufficient in itself to support a finding of misconduct. Although Sunshine's
representative at the hearing testified that he was the custodian of Sunshine's records,
he provided no testimony to establish that any of the three requirements of section
90.803(6) were satisfied. Sunshine simply submitted the documents to the referee
without providing an appropriate certification or declaration or any testimony concerning
the creation of the particular records submitted or Sunshine's practice with respect to
such records. In short, Sunshine presented nothing to establish that the documents
were within the scope of the business records exception.
The formalities with respect to the submission of evidence admittedly are
somewhat relaxed in the context of administrative proceedings. See Castillo v. Dep't of
Mgmt. Servs., Div. of Ret. Servs., 633 So. 2d 531, 533 (Fla. 2d DCA 1994) (noting
"relaxed standard for the admissibility of evidence in administrative proceedings"); C F
Chems., Inc., 400 So. 2d at 848 (stating that "rigorous and technical adherence to [the]
rules [regarding evidence] may not be exacted upon appeal [from the UAC] if the court
is satisfied on the entire record before it that the findings of the lower tribunal were
correct"). Those formalities are not, however, eliminated entirely.
A party seeking to rely on business records as sufficient in themselves to
support a finding in an administrative proceeding must make the showing required by
section 90.803(6). See Wark v. Home Shopping Club, Inc., 715 So. 2d 323, 324 (Fla.
2d DCA 1998) (holding that documentary evidence was not competent in itself to
support determination of misconduct "because no testimony was presented at the
hearing which could establish the predicate necessary to admit the [documents] as a
business record exception to the hearsay rule"); Doyle v. Fla. Unemployment Appeals
Comm'n, 635 So. 2d 1028, 1032 (Fla. 2d DCA 1994) (stating that "when documentation
is offered as the sole evidentiary support for a finding of misconduct . . . it can only be
used as a basis for disqualification if it is properly admitted under one of the hearsay
exceptions"); C F Chems., 400 So. 2d at 848 (holding that although "foundation for the
document might have been better laid," testimony established that personnel document
fell within scope of business records exception). In the absence of a showing by
Sunshine that the documents submitted fell within the scope of the hearsay rule
exception for records of regularly conducted business activity, the referee and the UAC
were precluded from relying on those records as sufficient evidence that Roy was guilty
of misconduct.
In the context of the administrative proceeding, Roy's failure to raise an
objection concerning the documents submitted by Sunshine did not prevent the referee
from treating those documents as hearsay evidence that was insufficient in itself to meet
Sunshine's burden of establishing that Roy was guilty of misconduct. Rule 60BB-
5.024(3)(d) specifically provides that an evidentiary objection need not be made before
the referee in order to be raised before the UAC. Since Roy's failure to object to the
documents submitted by Sunshine would not foreclose him from raising an objection
before the UAC, the absence of such an objection before the referee did not foreclose
the referee from determining that the documents were not within the scope of the
business records exception and were thus hearsay which in itself was not sufficient to
support Sunshine's claim of misconduct by Roy. See Yost v. Unemployment Appeals
Comm'n, 848 So. 2d 1235, 1237-38 (Fla. 2d DCA 2003) (holding that "evidence,
consisting solely of inadmissible hearsay, could not support a denial of benefits"
notwithstanding employee's "failure to object to the admissibility of this hearsay
testimony"); Doyle, 635 So. 2d at 1032 ("The fact that an employee does not object to
the admissibility of such critical documentary evidence does not preclude an appellate
court from considering the sufficiency of the evidence to support the UAC's decision.");
Harris v. Game & Fresh Water Fish Comm'n, 495 So. 2d 806, 809 (Fla. 1st DCA 1986)
(holding that "a party's failure to object to admissibility does not foreclose him from
subsequently asserting . . . that such hearsay evidence was insufficient because there
was no competent evidence introduced which the hearsay evidence could, in the
language of the statute, 'supplement or explain' "). But see Tri-State Sys., Inc. v. Dep't
of Transp., 500 So. 2d 212, 215 (Fla. 1st DCA 1986) (holding in appeal from
administrative proceeding that "as unobjected-to hearsay the testimony became part of
the evidence in the case and was usable as proof just as any other evidence").2
Conclusion
Because the referee and UAC did not err in treating the documents
submitted by Sunshine as hearsay evidence that was insufficient standing alone to
establish misconduct by Roy, we affirm the UAC's affirmance of the referee's ruling that
Roy was qualified for the receipt of unemployment benefits.
Affirmed.
SALCINES, J., Concurs.
ALTENBERND, J., Concurs with opinion.
ALTENBERND, Judge, Concurring.
I fully concur in this decision but question whether an employer should be
given a right to rehearing before the appeals referee under these circumstances. As
our opinion reflects, Sunshine Chevrolet Oldsmobile was represented in the administrative
proceeding by a corporate officer untrained in the law and the rules of evidence.
Sunshine filed documents in support of its claim of misconduct months before the
evidentiary hearing. No one objected to those documents. Mr. Roy did not attend the
hearing. The hearing was conducted over the telephone, and the referee asked all of
the questions. The documents were discussed extensively. The referee never ruled
that he was excluding the documents or that they were of limited value without additional
testimony. Near the end of the hearing, Sunshine’s representative offered to
bring other people to the telephone who were more familiar with the events detailed in
the documents, and the referee simply stated, “I’m pretty much through, sir.”
It is obvious from the record that Sunshine had several witnesses that it
could have brought to the telephone if its corporate representative had been given
notice that his records were either not admissible or admissible for limited purposes.
Admittedly, the employer has the burden of proof on the issue of misconduct and should
be prepared to prove its case. On the other hand, in these telephonic hearings where
no one is represented by an attorney, the referee tends to take on the role of attorney
for both sides, as well as serving as the judge. From a procedural due process
perspective it seems a little unfair that the employer is first notified about a defect in its
evidence when it receives the written ruling and can no longer takes steps to present
additional testimony.