STATE OF RHODE ISLAND
AND PROVIDENCE PLANTATIONS
PROVIDENCE,
SC DISTRICT COURT
A
& W ARTESIAN WELL CO. :
V.
: A.A. 03-105
DEPARTMENT OF LABOR AND TRAINING, BOARD OF REVIEW :
D E C I S I O N
DEROBBIO, C.J.
This matter is before the Court on the complaint of A & W Artesian Well
Co., filed pursuant to Rhode Island General Laws § 42-35-15, seeking judicial
review of a final decision rendered by the respondent, Board of Review, Department
of Labor and Training, which upheld the finding of the Referee that the claimant,
Darin S. Miller was entitled to receive employment security benefits.
The travel of the case is as follows. The claimant last worked on March 25,
2003. The claimant filed his new claim for benefits on April 27, 2003. In a
decision dated June 25, 2003, the Director determined the claimant was discharged
under disqualifying circumstances, as provided for under Section 28-44-18 of
the Rhode Island Employment Security Act. The claimant filed a timely appeal
of this decision. A hearing on this appeal was held on July 24, 2003, at which
the claimant appeared and provided testimony. The General Manager of the employer
appeared and provided testimony.
The Referee held the claimant was entitled to receive unemployment security
benefits, based on the determination that claimant, Darin S. Miller, was discharged
but not under disqualifying circumstances and was thus qualified pursuant to
Rhode Island General Laws § 28-44-18.
Thereafter, a timely appeal was filed and the matter was heard by the Board
of Review. The Board determined that the Referee's decision was a proper adjudication
of the facts, and upheld the Referee's decision. Thereafter, A & W Artesian
Well Co. filed a complaint for judicial review; jurisdiction for review of the
decisions of the Board is vested in the District Court by Rhode Island General
Laws § 28-44-52.
The standard of review is provided by Rhode Island General Laws § 42-35-15(g),
a section of the state Administrative Procedures Act, which provides as follows:
42-35-15. Judicial review of contested cases.
(g) The court shall not substitute its judgment for that of the agency as to
the weight of the evidence on questions of fact. The court may affirm the decision
of the agency or remand the case for further proceedings, or it may reverse
or modify the decision if substantial rights of the appellant have been prejudiced
because the administrative findings, inferences, conclusions, or decisions are:
(1) In violation
of constitutional or statutory provisions;
(2) In excess of the statutory authority of the agency;
(3) Made upon unlawful procedure;
(4) Affected by other error of law;
(5) Clearly erroneous in view of the reliable,
probative, and substantial evidence on the
whole record; or
(6) Arbitrary or capricious or characterized by abuse
of discretion or clearly unwarranted exercise of
discretion.
Thus, on questions
of fact, the District Court ". . . may not substitute its judgment for
that of the agency and must affirm the decision of the agency unless its findings
are clearly erroneous." Guarino v. Department of Social Welfare, 122 R.I.
583, 584, 410 A.2d 425 (1980) citing Rhode Island General Laws § 42-35-15(g)(5).
The Court will not substitute its judgment for that of the Board as to the weight
of the evidence on questions of fact. Cahoone v. Board of Review of the Department
of Employment Security, 104 R.I. 503, 246 A.2d 213 (1968). Stated differently,
the findings of the agency will be upheld even though a reasonable mind might
have reached a contrary result. Cahoone v. Board of Review of Department of
Employment Security, 104 R.I. 503, 246 A.2d 213, 215 (1968). See also D'Ambra
v. Board of Review, Department of Employment Security, 517 A.2d 1039, 1041 (R.I.
1986).
The Court has recognized that a liberal interpretation shall be utilized in
construing and applying the Employment Security Act:
. . . eligibility for benefits is to be determined in the light of the expressed
legislative policy that "Chapters 42 to 44, inclusive, of this title shall
be construed liberally in aid of their declared purpose which declared purpose
is to lighten the burden which now falls upon the unemployed worker and his
family." G.L.1956, § 28-42-73. The legislature having thus declared
a policy of liberal construction, this court, in construing the act, must seek
to give as broad an effect to its humanitarian purpose as it reasonably may
in the circumstances. Of course, compliance with the legislative policy does
not warrant an extension of eligibility by this court to any person or class
of persons not intended by the legislature to share in the benefits of the act;
but neither does it permit this court to enlarge the exclusionary effect of
expressed restrictions on eligibility under the guise of construing such provisions
of the act. Harraka v. Board of Review of Department of Employment Security,
98 R.I. 197, 201, 200 A.2d 595, 597 (1964).
The issue before the Court is whether the Board's determination that the Referee's
decision was a proper adjudication of the facts and that the claimant was discharged,
but not under disqualifying circumstances was supported by reliable, probative,
and substantial evidence in the record and whether or not it was clearly erroneous.
The Board of Review adopted the following findings of fact of the Referee:
"The claimant had been working in sales for a pump company last on March
25, 2003. The claimant worked full-time. The claimant was discharged by this
employer when the employer discovered that the claimant's wife had started a
business which was felt to be in competition with the company. The claimant
holds a 10% interest in this new corporation. The employer indicated that during
the claimant's employment with the company that there was a non-competing clause
initiating which would have prevented the claimant from working or performing
services for competition. The claimant was discharged under these conditions."
The Board of Review adopted the following conclusions of the Referee:
"An individual who is discharged for reasons of proven misconduct in connection
with his work must be held to have been terminated under disqualifying circumstances
under the provisions of Section 28-44-18 which provides, in part, as follows:
For the purposes of this section, misconduct shall be defined as deliberate
conduct in willful disregard of the employer's interest, or a knowing violation
of a reasonable and uniformly enforced rule or policy of the employer, provided
that such violation is not shown to be as a result of the employee's incompetence.
Notwithstanding any other provisions of chapters 42 - 44 of this title, this
section shall be construed in a manner which is fair and reasonable to both
the employer and the employed worker.
In the case of Turner vs. Department of Employment and Training, Board of Review,
479 A 2d 740, 741-42 (R.I. 1984), the Rhode Island Supreme Court adopted a general
definition of the term, 'misconduct', as enunciated in Boynton Cab Co. vs. Newbeck,
[sic] 237 Wis. 249, 296 N.W. 636 (1941):
"'[M]isconduct' . . . is limited to conduct evincing such willful or wanton
disregard of an employer's interests as is found in deliberate violations or
disregard of standards of behavior which the employer has the right to expect
of his employee, or in carelessness or negligence of such degree or recurrence
as to manifest equal culpability, wrongful intent or evil design, or to show
an intentional and substantial disregard of the employer's interest or of the
employee's duties and obligations to his employer. On the other hand mere inefficiency,
unsatisfactory conduct, failure in good performance as the result of inability
or incapacity, inadvertencies or ordinary negligence in isolated instances,
or good faith errors in judgment or discretion are not to be deemed 'misconduct'
within the meaning of the statute. Id. at 259-60, 296 N.W. at 640."
In all cases of discharge, the burden of proof to show misconduct in connection
with the work on the part of the claimant rests solely with the employer. In
the instant case, the claimant had last worked on March 25, 2003. His employer
terminated the claimant when it was discovered that his wife had initiated a
company, which was in direct competition to the claimant's employer. The claimant
was not under any non-competing clause. While the employer may have felt that
they could no longer keep the claimant working for them under these conditions,
I cannot find the claimant's separation to be under disqualifying circum-stances.
The employer has not demonstrated the claimant's actions, which lead to his
separation, constitute misconduct rising to the level cited above. The definition
of misconduct as cited above is the standard used in these cases. Therefore,
the claimant cannot be denied benefits on this issue."
There is evidence to demonstrate that the claimant was employed by a specialized
company dealing with well digging, pump installation and water filtration. The
claimant was employed from July 1, 2002 to March 25, 2003, when the claimant
was discharged for alleged misconduct in connection with his employment. There
is also evidence on the record that claimant's wife started a competitive business
of well digging, pump installation and water filtration in competition with
the employer.
The record is clear that there was not a non-competition clause in their employer/employee
relationship which prevented the claimant from performing services for his wife's
corporation, in which the claimant owned a 10% interest and was an officer of
this new corporation. Although there was a belief that the prior association
with A & W Artesian Well Company caused six former customers to be serviced
by claimant's wife's corporation, there is no evidence on the record to establish
that this was a result of and during the claimant's employment with plaintiff.
Although the appellant had a right to terminate the claimant, there is no evidence
on the record that the conduct of the claimant rises to the level of misconduct
as defined by Turner v. The Department of Employment Security. The burden of
proof in a case of misconduct rests solely on the plaintiff.
A review of the entire record demonstrates that there is substantial, probative
and reliable evidence to support the findings of fact, conclusions and decision
of the Board of Review.
On findings of fact, as to the weight of the evidence, this Court shall not
substitute its judgment for that of the administrative agency.
The scope of judicial review by the Court is limited by Section 28-44-54 which
in its pertinent part provides:
28-44-54. Scope of judicial review - Additional evidence - Precedence of proceedings.
- The jurisdiction of the reviewing court shall be confined to questions of
law, and, in the absence of fraud, the findings of fact by the board of review,
if supported by substantial evidence regardless of statutory or common law rules,
shall be conclusive.
Upon careful review of the evidence, this Court finds that the decision of the Board was not "clearly erroneous in view of the reliable, probative and substantial evidence on the whole record," and that said decision was not "arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion." Rhode Island General Laws § 42-35-15(g)(5)(6).
Accordingly, the decision of the Board is hereby affirmed.