IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                                       DIVISION ONE

GEORGE TEREK,
                                              )            No. 57816-2-I
                  Respondent,                 )
                                              )
               v.                             )         UNPUBLISHED OPINION
                                              )
                                              )
WASHINGTON STATE EMPLOYMENT                   )
SECURITY DEPARTMENT,                          )
                                              )
                        Appellant.            )
                                                )      FILED: February 20, 2007

                                              )
       SCHINDLER, A.C.J.  --  George Terek, the chief mate of the Washington State 

passenger ferry M/V Sealth, made a series of decisions that resulted in running the 

ferry aground on Reid Rock, jeopardizing the passengers and crew and causing 

approximately $330,000 in damages.  The Washington Employment Security 

Department (the Department) appeals the superior court order reversing the 

Department's decision that Terek's actions constituted misconduct disqualifying him 

from receiving unemployment compensation.

       The facts are undisputed.  From June 1984 until February 18, 2005, George 

Terek worked as a chief mate for the Washington State Ferries (WSF).  On December 

24, 2004, Terek was the officer in charge of the night watch for the Friday Harbor to 

Lopez Island to Anacortes ferry run on the M/V Sealth. 

No. 57816-2-I/2

       As the officer in charge of the watch, Terek was responsible for knowing the

ferry's location and directing the ferry's course. The quartermaster is in charge of 

steering the ferry.  According to the posted Bridge Resource Management (BRM) 

procedures and protocols, the chief mate must monitor the ferry's course at all times 

and give orders to the quartermaster to maintain the proper course.  The ferries are 

equipped with special radar mapping technology showing land and navigational 

dangers to assist the chief mate in making course decisions.  The BRM also requires 

the officer in charge to notify the master if the ferry is off course.  

       Because it was a clear night and Terek had navigated the Friday Harbor to 

Anacortes route hundreds of times in the past, he decided to not use the mapping 

technology.  Terek and the quartermaster had worked together a number of times on 

various routes, but had not worked together on the Friday Harbor to Anacortes route.  

Nonetheless, Terek assumed the quartermaster knew the route and did not give the 

quartermaster course directions.

       The quartermaster pulled away from the Friday Harbor dock at 8:00 p.m.  It was 

dark, but the sky was clear and visibility was good.  At 8:06 p.m., Terek realized the 

ferry had traveled approximately a quarter mile past the point where the ferry normally 

starts heading south through the San Juan channel toward Lopez Island. Instead of 

using the mapping function or notifying the master that the ferry was off course, Terek 

ordered the quartermaster to immediately make a hard right turn. Traveling at full 

speed, the ferry collided with Reid Rock, a shallow reef that is lighted with a buoy.  The 

damage to the ferry was approximately $330,000.  

                                               2 

No. 57816-2-I/3

       Terek was suspended for running the M/V Sealth aground.  The Department 

initially granted Terek's request for unemployment benefits.  The WSF appealed the 

Department's decision.  The administrative law judge for the State of Washington Office 

of Administrative Hearings for the Employment Security Department (ALJ) conducted a 

hearing on whether Terek was entitled to unemployment benefits.  The ALJ entered 

detailed findings and concluded Terek's actions constituted misconduct that 

disqualified him from receiving unemployment benefits.  

       While claimant denies any willfulness or intention in causing the 
       accident, the undersigned concludes claimant's failure to follow policy 
       and procedure is evidence of such a degree of carelessness as to 
       constitute a wilful [sic] disregard for his employer's best interests. . . . 
       On the evening of December 24, 2004, claimant was the officer of the 
       watch, responsible for tracking the exact location of the vessel at all 
       times and navigating the route of travel. . . .  Claimant failed to provide 
       any navigational direction to the quarter master [sic] and failed to keep 
       track of the vessel's position at all times as required.  Had claimant 
       done his job claimant would have been able to ascertain his quarter 
       master's [sic] lack of familiarity with the particular route of travel, and 
       would have provided proper directional orders keeping the vessel on 
       course.  Bridge resource management exists . . . to avoid the very 
       situation which occurred. . . .  Claimant was aware of such policies, but 
       made incorrect assumptions . . . and relied upon his own experience 
       rather than availing himself of the technological resources available . . 
       . and following the proper procedures once he discovered he was off 
       course. . . . The public relies upon claimant's abilities, skill, and 
       knowledge . . . to ensure their safety.  Here, claimant disregarded 
       basic policy and exercised poor judgment when policies provided for 
       specific direction, resulting in hundreds of thousands of dollars in 
       damages to employer property, jeopardizing the safety of ferry 
       passengers, and jeopardizing employer's reputation.

       Terek petitioned for review of the ALJ decision to the Commissioner Review 

Office.  The Commissioner affirmed the ALJ decision disqualifying Terek from receiving 

unemployment benefits.  

       [T]his incident is significantly more than an isolated instance of

                                               3 

No. 57816-2-I/4

       ordinary negligence.  The claimant was a long-time pilot well 
       experienced in navigating ferries. . . . The claimant's violations of 
       various employer's rules, policies, and accepted maritime navigation 
       practice were numerous and without reasonable excuse. . . . Even if 
       we were to assume (and we do not agree with this proposition) that 
       each of these violations individually and separately may not 
       constitute disqualifying misconduct, it is apparent that the sheer 
       number of the various violations, all of which involve maritime safety 
       for the benefit of the public can only lead to a conclusion that 
       misconduct has been established pursuant to RCW 50.04.294.

       On appeal, the superior court reversed the Department's decision.  The 

Department contends the superior court erred in reversing the decision to disqualify

Terek from receiving unemployment benefits.  The Department contends Terek's 

actions constituted misconduct as defined by RCW 50.04.294(1).  Terek contends his 

actions constitute "inadvertence or ordinary negligence" or "good faith errors in 

judgment or discretion" that the Legislature excluded from the definition of misconduct 

in RCW 50.04.294(3).  

       The Washington Administrative Procedure Act (WAPA), Chapter 34.05 RCW, 

governs judicial review of final agency action.  When reviewing agency action, this 

court "sits in the same position as the superior court, applying the standards of the 

WAPA directly to the record before the agency."  Tapper v. Employment Sec. Dep't, 

122 Wn.2d 397, 402, 858 P.2d 494 (1993).  The court will reverse an agency decision 

only if it finds that (1) the agency erroneously interpreted or applied the law, or (2) 

substantial evidence does not support the decision, or (3) the order is arbitrary or 

capricious.  RCW 34.05.570(3).  The party challenging an agency decision must 

establish error and demonstrate the agency action is invalid.  RCW 34.05.750(1)(a).  

       Whether an employee's actions constitute misconduct is a mixed question of law 

                                               4 

No. 57816-2-I/5

and fact.  Tapper, 122 Wn.2d at 402-03.  We review the agency's findings of fact for 

substantial evidence.  William Dickson Co. v. Puget Sound Air Pollution Control 

Agency, 81 Wn. App. 403, 407, 411, 914 P.2d 750 (1996).  We review questions of law 

de novo, according substantial weight to the agency's interpretation of the law it 

administers.  William Dickson, 81 Wn. App. at 403, 407.  

       Because the Department does not challenge any of the ALJ's findings of fact,
they are verities on appeal.1  Tapper, 122 Wn.2d at 407.  The Department contends the 

findings establish misconduct under RCW 50.04.294(1).  Terek contends the findings 
only establish ordinary negligence or good faith errors in judgment.2

       Under the Employment Security Act, an individual is disqualified from receiving 

benefits if he or she is discharged "for misconduct connected with his or her work."  

RCW 50.20.066. 

       RCW 50.04.294(1) defines misconduct as follows:

              (1) 'Misconduct' includes, but is not limited to, the following conduct 
              by a claimant:
              (a) Willful or wanton disregard of the rights, title, and interests of the
              employer or a fellow employee;
              (b) Deliberate violations or disregard of standards of behavior which 
              the employer has the right to expect of an employee;
              (c) Carelessness or negligence that causes or would likely cause 
              serious bodily harm to the employer or a fellow employee; or
              (d) Carelessness or negligence of such degree or recurrence to 
              show an intentional or substantial disregard of the employer's 
              interest.

       RCW 50.04.294(3) excludes certain conduct from the definition of misconduct:

              (3) 'Misconduct' does not include:

       1 At oral argument, Terek's attorney also conceded the findings are undisputed.

       2 Both parties argue extensively about whether Terek's actions violate a company rule under 
RCW 50.04.294(2).  But because the ALJ specifically ruled Terek's conduct did not violate RCW 
50.04.294(2)(f), we need not address this argument.

                                               5 

No. 57816-2-I/6

              (a) Inefficiency, unsatisfactory conduct, or failure to perform 
              well as the result of inability or incapacity;
              (b) Inadvertence or ordinary negligence in isolated instances; or
              (c) Good faith errors in judgment or discretion.

       We conclude that the undisputed findings support the Department's conclusion 

that Terek's actions established misconduct under RCW 50.04.294(1) and did not 

constitute either an isolated instance of ordinary negligence or good faith errors in 

judgment.  Terek made a series of decisions that violated the standards and 

procedures expected of the chief mate in charge of the watch and jeopardized the 

safety of the passengers and crew.

       As the chief mate in charge of the watch, Terek was responsible for knowing the 

ferry's exact location and giving the quartermaster navigational directions.  Without 

discussion, Terek assumed the quartermaster knew the route and accordingly, gave no 

navigational directions and failed to monitor the ferry's course.  Terek also decided not 

to use the mapping technology because it was a clear night and he was familiar with 

the route.  When Terek realized the quartermaster missed the turn, Terek instructed 

the quartermaster to take a hard right into a marked danger area.  As a result, the M/V

Sealth collided with Reid Rock at full speed, jeopardizing the passengers and crew and 

resulting in over $330,000 damage to the ferry.  These findings establish misconduct as 

defined in RCW 50.04.294(1).

       We reverse the superior court order and affirm the Department's decision

disqualifying Terek from receiving unemployment compensation.

                                               6 

No. 57816-2-I/7

WE CONCUR:

                                               7