Supreme Court of Iowa Decision
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Case Title: JERRY R. SIEVERTSEN, Appellee, vs. EMPLOYMENT APPEAL BOARD, Appellant.
Date: 04/15/92
Bound Citation:
Summary: No. 122/91-617
Decision: Appeal from the Iowa District Court for Scott County,
Edward B. deSilva, Judge.

Employment Appeal Board appeals from order reversing
its decision denying unemployment benefits to claimant and providing for recoupment of benefits paid under mistake of law. AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

Joe E. Smith and William C. Whitten, Des Moines, for appellant.

Michael A. Woods, Bettendorf, for appellee.

Considered by McGiverin, C.J., and Schultz, Carter,
Lavorato, and Andreasen, JJ.
CARTER, J.
The Employment Appeal Board appeals from a district
court order reversing in part its final agency decision
denying claimant Jerry R. Sievertsen's eligibility for
unemployment benefits. The final agency decision also
provided for recoupment of benefits previously paid under
mistake of law for which claimant was not eligible.
Although the district court agreed with the agency's
conclusions that claimant was ineligible for the benefits
in question and affirmed the agency's denial of future
benefits, it held that the agency was estopped to recoup
past benefits paid under mistake of law. After considering
the arguments presented, we reverse the order of the
district court and affirm the final agency decision.
Claimant had been an employee of the J.I. Case plant in
Bettendorf for seventeen years when that plant closed in
March of 1988. He applied for unemployment benefits. He
was eligible for special benefit status under the Trade
Readjustment Act, Trade Act of 1974, 19 U.S.C. Sections 2101-2487
(1980) (TRA). That federal legislation establishes special
benefit eligibility for workers who become unemployed due
to foreign production of goods that impact adversely on
domestic production. See 345 Iowa Admin. Code 4.45 (1991).
The provisions of 19 U.S.C. Sec. 2294 specify that
continued eligibility for benefits under the TRA is tied to
the basic qualifying conditions that have been established
by state law. Iowa Code section 96.4(4) (1991) provides,
in part, that,
[i]f the individual has drawn benefits in any
benefit year, the individual must during or
subsequent to that year, work in and be paid wages
for insured work totaling at least two hundred
fifty dollars, as a condition to receive benefits
in the next benefit year.

The Department of Employment Services (DES) applied this
rule to the claimant's situation in August of 1989 and
advised him that he needed to earn at least $250 in covered
wages to remain eligible for further unemployment benefits.
Claimant has never disputed that requirement.
Claimant endeavored to obtain the required $250 in
covered wages through employment at Marycrest College as a
carpenter. At the time, he was a full-time student at
Marycrest. The record reflects that claimant specifically
asked DES representatives whether this employment would
serve to qualify him for continued unemployment eligibility
and was given the assurance that it would. Later, after
claimant had earned more than $250 in his Marycrest
employment, the agency determined that this was not
"covered employment" for purposes of the eligibility
requirement contained in section 96.4(4).
The agency's shift in position was prompted by 345 Iowa
Administrative Code 3.20, which provides:

Wages earned by a student who performs
services in the employ of a school, college or
university at which the student is enrolled and is
regularly attending classes (either on a full-time
or part-time basis) cannot be used for claim or
benefit purposes.
Wages earned by an individual who is a
full-time employee for a school, college or
university whose academic pursuit is incidental to
the full-time employment, would be used for claim
and benefit purposes.
Claimant challenged the agency's interpretation of this
regulation. After losing on this issue at the highest
agency level, he sought judicial review pursuant to Iowa
Code section 17A.19 (1991). In addition to challenging the
agency's interpretation of its own rule, he also raised in
the district court a claim of estoppel. Only the estoppel
issue is presented on this appeal.
In considering the district court's determination that
the agency was estopped to recoup benefits that had been
paid under mistake of law, we are not only faced with a
line of cases that have refused to invoke estoppel principles
against public agencies, see Hawkeye By-Products,
Inc. v. State, 419 N.W.2d 410 (Iowa 1988); City of Lamoni
v. Livingston, 392 N.W.2d 506 (Iowa 1986); Drainage Dist.
No. 119 v. City of Spencer, 268 N.W.2d 493 (Iowa 1978);
Sullivan v. Iowa Departmental Hearing Bd., 325 N.W.2d 923
(Iowa App. 1982), but also must confront the following
statute relating to unemployment benefits:

If an individual receives benefits for which the
individual is subsequently determined to be
ineligible, even though the individual acts in
good faith and is not otherwise at fault, the
benefits shall be recovered.

Iowa Code Sec. 96.3(7) (1991).
We believe that the authorities cited preclude a
finding that the Department of Employment Services is
estopped from recouping the payments made to the claimant
for which he was ineligible under the controlling regulations.
We have considered all issues presented and
conclude that the judgment of the district court should be
affirmed as to the merits of the eligibility issue but
reversed on the estoppel issue. The case is remanded to
that court for an order affirming the final agency decision.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.