Blalock v. DEPT. OF HEALTH & HUMAN SERV.

• Decision Date: 15 May 2001
• Docket Number: No. COA99-1559.,COA99-1559.
• Parties: Genoal BLALOCK, Petitioner, v. North Carolina DEPARTMENT OF HEALTH AND HUMAN SERVICES, Division of Facility Services, Respondent.
• Court: North Carolina Court of Appeals

546 S.E.2d 177

143 NC App. 470

Genoal BLALOCK, Petitioner, v. North Carolina DEPARTMENT OF HEALTH AND HUMAN SERVICES, Division of Facility Services, Respondent.

No. COA99-1559.

Court of Appeals of North Carolina.

May 15, 2001.

Doran and Shelby, P.A., by Michael Doran, Salisbury, for petitioner-appellant.

Attorney General Michael F. Easley, by Assistant Attorney General Jane L. Oliver, for respondent-appellee.

HUNTER, Judge.

Genoal Blalock ("petitioner") appeals from the trial court's order affirming the North Carolina Department of Health and Human Services, Division of Facility Services' ("the agency") decision to substantiate findings of abuse, neglect, and misappropriation of resident property on the part of petitioner. On appeal, petitioner contends that (1) the trial court erred in affirming the agency's final decision because it was not supported by substantial evidence and was arbitrary and capricious, and (2) the agency's decision was affected by errors of law. As to both contentions, we disagree. Accordingly, we affirm the decision of the trial court.

Petitioner worked as a certified nurse assistant ("CNA") at Autumn Care Nursing Home ("the facility") in Salisbury, North Carolina from July 1991 until September 1996. In late August 1996, the facility received a report from another CNA that petitioner had physically and verbally abused a resident during July 1996. Based on this report, the facility reported the allegation of abuse to the agency and then began an internal investigation. From its internal investigation, the facility concluded that petitioner had physically and verbally abused the resident as had been alleged. Consequently, the facility's Assistant Director of Nursing terminated petitioner's employment on 5 September 1996. Petitioner did not appeal her termination. By letter dated 28 October 1996, the agency notified petitioner that it would conduct its own investigation to determine whether or not her alleged conduct should result in findings of patient abuse on her part and be placed on the Nurse Aide Registry and the Health Care Personnel Registry ("Registries"). The agency's letter informed petitioner that an investigator would contact her to obtain her account of the allegation. Additionally, the letter notified petitioner of her appeals rights and her opportunity to use informal procedures to resolve any dispute she had with the agency's action. Subsequently, Wayne Denning ("Denning"), an abuse investigator, was assigned to petitioner's case. During the course of his investigation, Denning interviewed petitioner by telephone and, petitioner denied any wrongdoing. Additionally, Denning interviewed other facility employees and reviewed the facility's personnel and medical records. Further, Denning interviewed a CNA who was a former facility employee; this individual contacted Denning to provide additional information pertaining to his investigation.

Upon completing his investigation, Denning substantiated twenty-two allegations involving abuse, neglect, or misappropriation of resident property on the part of petitioner. By letter dated 21 August 1997, Denning informed petitioner of the nature of each substantiated allegation and gave her a summary of the evidence. This letter informed petitioner of the agency's intent to place its findings on the Registries and informed her of her rights of appeal.

Subsequently, petitioner filed for a contested case hearing in the Office of Administrative Hearings on 24 September 1997, challenging the agency's decision to place its findings on the Registries. The hearing was held on 4 and 5 December 1997 before Administrative Law Judge ("ALJ") Beecher R. Gray. At the hearing, the agency decided to limit its prosecution to only six incidents involving five residents. On 12 February 1998, ALJ Gray issued a Recommended Decision that the agency's decision be dismissed as not supported by the evidence.

Thereafter, the agency filed exceptions and objections to the Recommended Decision on 23 April 1998. After its review, the agency issued a Final Agency Decision on 7 May 1998, rejecting the ALJ's Recommended Decision and upholding the agency's initial decision to substantiate findings of abuse, neglect, and misappropriation of resident property on the part of petitioner.

Petitioner filed for judicial review of the Final Agency Decision in Stanly County Superior Court on 12 June 1998. A hearing was held at the 7 June 1999 session of superior court, the Honorable Russell G. Walker, Jr. presiding. By order filed on 12 July 1999, Judge Walker affirmed the Final Agency Decision. Petitioner appeals.

In her first assignment of error, petitioner maintains that the trial court erred in affirming the agency's final decision because it was not supported by substantial evidence. We disagree.

Where there is an appeal to this Court from a trial court's order affirming an agency's final decision, we must "(1) determine the appropriate standard of review and, when applicable, (2) determine whether the trial court properly applied this standard." In re Appeal by McCrary, 112 N.C.App. 161, 166, 435 S.E.2d 359, 363 (1993). "[T]he standard of review which should be employed in reviewing an agency decision depends upon the nature of the alleged error." Id. Where petitioner alleges that the agency's decision was not supported by substantial evidence, or was arbitrary and capricious, the whole record test is applied. See ACT-UP Triangle v. Commission for Health Services, 345 N.C. 699, 706, 483 S.E.2d 388, 392 (1997). The trial court's order affirming the agency's decision indicates that the whole record test was applied. Therefore, we must determine whether the test was applied properly.

Under the whole record test, the entire record is examined to determine whether the agency decision is supported by substantial evidence. See id. "`Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.'" Lackey v. Dept. of Human Resources, 306 N.C. 231, 238, 293 S.E.2d 171, 176 (1982) (quoting Comr. of Insurance v. Rating Bureau, 292 N.C. 70, 80, 231 S.E.2d 882, 888 (1977)). If substantial evidence supports an agency's decision after the entire record has been reviewed, the decision must be upheld. See In re Appeal by McCrary, 112 N.C.App. 161, 168, 435 S.E.2d 359, 365.

Significantly, the whole record test requires the court to consider both evidence justifying the agency's decision and contrary evidence that could lead to a different result. Id. at 167-68, 435 S.E.2d at 364. However, the test "does not allow the reviewing court to replace the [agency's] judgment as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before it de novo ...." Thompson v. Board of Education, 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977). We further recognize that witness credibility and the probative value of testimony are determined by the administrative agency, which may accept or reject any or all of a witness's testimony. See Comr. of Insurance v. Rate Bureau, 300 N.C. 381, 406, 269 S.E.2d 547, 565 (1980).

Primarily, petitioner contends that the eyewitness testimony the agency relied upon in reaching its decision is inadequate to support the conclusion that she committed the alleged misconduct. To support her contention, petitioner asserts that testimony by the agency's witnesses was inconsistent, the agency's witnesses were biased and delayed reporting the alleged misconduct, and there was no evidence of significant physical injury to residents. However, a review of the entire record shows substantial evidence that supports the agency's decision: (1) credible eyewitness testimony from four of petitioner's coworkers that petitioner engaged in the misconduct at issue on several occasions; (2) testimony regarding incriminating statements that petitioner made to her coworkers, and; (3) evidence that a resident's physical condition improved shortly after petitioner was discharged. Based upon our review of the entire record, we conclude that the agency's final decision is supported by substantial evidence. Therefore, petitioner's first assignment of error is rejected.

Petitioner's second assignment of error is that the trial court erred in affirming the agency's final decision because it was arbitrary and capricious. Again, we disagree.

In addition to her contention that the decision was not supported by the evidence, petitioner asserts as additional evidence of the agency's arbitrariness: (1) the agency's reliance on petitioner's credibility in a case in 1996 when she reported a coworker's act of abuse and its later rejection of petitioner's credibility in reference to her denials of misconduct in this case, (2) the manner in which the agency conducted its investigation, and (3) the agency's disregard of petitioner's character witnesses. We begin by noting that the

"arbitrary or capricious" standard is a difficult one to meet. Administrative agency decisions may be reversed as arbitrary or capricious if they are ... "whimsical" in the sense that "they indicate a lack of fair and careful consideration" or "fail to indicate `any course of reasoning and the exercise of judgment'...."

Lewis v. N.C. Dept. of Human Resources, 92 N.C.App. 737, 740, 375 S.E.2d 712, 714 (1989) (quoting Comr. of Insurance, 300 N.C. 381, 420, 269 S.E.2d 547, 573). Moreover, "the reviewing court does not have authority to override decisions within agency discretion when that discretion is exercised in good faith and in accordance with law." Lewis, 92 N.C.App. 737, 740, 375 S.E.2d 712, 714.

Our review of the whole record reveals no unfairness or lack of careful consideration on the agency's part. The agency made...