81 Hawai'i 84, Rife v. Akiba

• Decision Date: 28 February 1996
• Docket Number: No. 17435,17435
• Citation: 912 P.2d 581
• Parties: 81 Hawai'i 84 John M. RIFE, Appellant-Appellant, v. Lorraine AKIBA, 1 Director of Department of Labor and Industrial Relations, and Pentagram Corporation, Appellees-Appellees.
• Court: Hawaii Court of Appeals

Page 581

912 P.2d 581

81 Hawai'i 84

John M. RIFE, Appellant-Appellant, v. Lorraine AKIBA, ¹ Director of Department of Labor and Industrial Relations, and Pentagram Corporation, Appellees-Appellees No. 17435.

Intermediate Court of Appeals of Hawai'i.

Feb. 28, 1996.

Syllabus by the Court

The employee terminated his employment and then applied for unemployment benefits. The employee had the burden to prove that he terminated his employment with good cause. At the agency hearing, the employee alleged that one or more of three reasons constituted good cause for his termination of his employment. Hawai'i Revised Statutes (HRS) § 91-12 mandates that the agency's decision and order shall be accompanied by separate findings of fact and conclusions of law. In this case, the agency's findings did not decide whether the employee satisfied his burden of proving that one or more of the alleged three reasons were facts and, if so, whether one or more of these facts constituted good cause for his terminating his employment.

Appeal from the First Circuit Court, Honolulu County (Civ. No. 92-4674).

Tucker A. Dacey, Legal Aid Society of Hawaii, on the briefs, Kaneohe, for appellant-appellant.

Susan Barr and Robyn M. Kuwabe, Deputy Attorneys General, on the brief, Honolulu, for Department of Labor and Industrial Relations, appellees-appellees.

Before BURNS, C.J., and ACOBA and KIRIMITSU, JJ.

BURNS, Chief Judge.

Appellant John M. Rife (Rife) was employed by the Pentagram Corporation, doing business as a Burger King restaurant (Employer), from August 1991 until September 25, 1992, when he terminated his employment. On September 30, 1992, Rife applied to the State of Hawai'i Department of Labor and Industrial Relations (the Department) for unemployment benefits. The Department's claims examiner denied the application on October 27, 1992. Rife appealed. On November 30, 1992, after a hearing on November 23, 1992, the appeals officer affirmed. Rife appealed. On August 31, 1993, after a hearing on July 19, 1993, the circuit court affirmed. Rife appealed. We vacate and remand.

THE LAW GOVERNING APPELLATE REVIEW

Hawai'i Revised Statutes (HRS) § 91-14(g) (1993) governs each court called upon to decide an appeal of an agency decision. Dole Hawaii Division--Castle & Cooke, Inc. v. Ramil, 71 Haw. 419, 424, 794 P.2d 1115, 1118 (1990). HRS § 91-14(g) states as follows:

(g) Upon review of the record the court may affirm the decision of the agency or remand the case with instructions for further proceedings; or it may reverse or modify the decision and order if the substantial rights of the petitioners may have been prejudiced because the administrative findings, conclusions, decisions, or orders are:

(1) In violation of constitutional or statutory provisions; or

(2) In excess of the statutory authority or jurisdiction of the agency; or

(3) Made upon unlawful procedure; or

(4) Affected by other error of law; or

(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.

Rife asks us to reverse the Department's decision.

We do not reach the HRS § 91-14(g)(5) issue. We vacate and remand pursuant to HRS § 91-14(g)(1) because the Department failed to satisfy HRS § 91-12 (1993).

THE APPLICABLE LAW

Hawai'i's Employment Security Law states in HRS § 383-30 (1993) various disqualifications for benefits. One of those disqualifications is stated in HRS § 383-30(1) in relevant part as follows:

Disqualification for benefits. An individual shall be disqualified for benefits:

(1) Voluntary separation.... For any week beginning on and after October 1, 1989, in which the individual has left the individual's work voluntarily without good cause, and continuing until the individual has, subsequent to the week in which the voluntary separation occurred, been paid wages in covered employment equal to not less than five times the individual's weekly benefit amount as determined under section 383-22(b).

Although the employer usually has the burden of proving the relevant facts, National Tire of Hawaii, Ltd. v. Kauffman, 58 Haw. 265, 567 P.2d 1233 (1977), the employee has the burden of establishing that the voluntary termination was with good cause. Noor v. Agsalud, 2 Haw.App. 560, 562, 634 P.2d 1058, 1060 (1981).

HRS § 383-30(3)(A) defines the existence of good cause as follows:

(A) In determining whether or not any work is suitable for an individual there shall be considered among other factors ..., the degree of risk involved to the individual's health, safety, and morals, the individual's physical fitness and prior training, the individual's experience and prior earnings, the length of unemployment, the individual's prospects for obtaining work in the individual's customary occupation, the distance of available work from the individual's residence, and prospects for obtaining local work. The same factors so far as applicable shall be considered in determining the existence of good cause for an individual's voluntarily leaving work under paragraph (1).

The Administrative Rules of the Unemployment Insurance Division of the Department state in Title 12, Chapter 5, in relevant part as follows:

§ 12-5-47 Voluntary Separation. (a) An individual shall be disqualified for benefits for voluntarily leaving work without good cause.

(b) A separation is a voluntary leaving or quitting when the facts and circumstances demonstrate that a claimant is the "moving party" in the termination of an employment relationship.

(c) Generally, a leaving of work is considered to be for good cause where it is for a real, substantial, or compelling reason, or a reason which would cause a reasonable and prudent worker, genuinely and sincerely desirous of maintaining employment, to take similar action. Such a worker is expected to try reasonable alternatives before terminating the employment relationship. Good cause for leaving employment may be found where there is:

(1) Change in working conditions and the change is prejudicial or detrimental to the health, safety, or morals of the claimant;

(2) Change in terms and conditions of employment including but not limited to: change in rate of pay, position or grade, duties, days of work, or hours of work;

(3) Discrimination which violates federal or state laws regarding equal employment opportunity practices;

(4) Change in employee's marital or domestic status;

(5) Acceptance of a definite, firm offer made of other employment where the offer is subsequently withdrawn and the former employer refuses to rehire the employee;

(6) Retirement under a mandatory requirement imposed by a collective bargaining agreement; or

(7) Any other factor relevant to a determination of good cause.

HRS § 91-12 (1993) states in relevant part as follows:

Decisions and orders. Every decision and order adverse to a party to the proceeding, rendered by an agency in a contested case, shall be in writing or stated in the record and shall be accompanied by separate findings of fact and conclusions of law.

The Hawai'i Supreme Court interpreted HRS § 91-12 and held:

All that is required is that the agency incorporate its findings in its decision. In so doing, however, the agency must make its findings reasonably clear. The parties and the court should not be left to guess, with respect to any material question of fact, or to any group of minor matters that may have cumulative significance, the precise finding of the agency.

In re Terminal Transp., Inc., 54 Haw. 134, 139, 504 P.2d 1214, 1217 (1972) (citations omitted).

There are very practical reasons for requiring an agency's findings and conclusions upon all material issues of fact, law, or discretion to be stated in its decisions. As Professor Davis, in his well-known Administrative Law Treatise, has stated:

The reasons have to do with facilitating judicial review, avoiding judicial usurpation of administrative functions, assuring more careful administrative consideration, helping parties plan their cases for rehearing and judicial review, and keeping agencies within their jurisdiction.

Much the most prominent reason discussed in judicial opinions, ... is the facilitation of judicial review. A simple illustration will readily show the need for findings as an aid to judicial review. A statute provided that no milk license should be granted unless the commissioner "is satisfied that the applicant is qualified by character, experience, financial responsibility and equipment to properly conduct the proposed business, that the issuance of the license will not tend to a destructive competition in a market already adequately served, and that issuance of the license is in the public interest." For the court to review a bulky record without knowing which of the six factors the commissioner found to be lacking would obviously be wasteful. Hardly surprising was the court's holding that "Only after the commissioner has made findings of fact can the court decide whether the findings are sustained by the evidence...." ...

The language of Mr. Justice Cardozo, in a case in which the Court could do no more than get an impression that the Commission may have acted properly, is often quoted: "The difficulty is that it has not said so with the simplicity and clearness through which a halting impression ripens into reasonable certitude. In the end we are left to spell out, to argue, to choose between conflicting inferences. Something more precise is requisite in the quasi-jurisdictional findings of an administrative agency.... We must know what a decision means before the duty becomes ours to say whether it is right or wrong." ...

A second practical reason for requiring findings--preventing judicial usurpation of administrative functions--applies to administrative agencies with much greater force than it does to trial courts sitting...