Carlson v. Arizona State Personnel Bd.

• Decision Date: 06 March 2007
• Docket Number: No. 1 CA-CV 06-0110.,1 CA-CV 06-0110.
• Parties: Kenyon CARLSON, Plaintiff/Appellant, v. The ARIZONA STATE PERSONNEL BOARD; Gwendolyn Hatcher, Chairman; Steve Sepnieski, Vice-Chairman; Jeff Grant, Board Member; Simon Deltran, Board Member, in their official capacities; The Arizona Department of Environmental Quality; Steve Owens, in his official capacity as Director of Department of Environmental Quality, Defendants/Appellees.
• Court: Arizona Court of Appeals

153 P.3d 1055

214 Ariz. 426

Kenyon CARLSON, Plaintiff/Appellant, v. The ARIZONA STATE PERSONNEL BOARD; Gwendolyn Hatcher, Chairman; Steve Sepnieski, Vice-Chairman; Jeff Grant, Board Member; Simon Deltran, Board Member, in their official capacities; The Arizona Department of Environmental Quality; Steve Owens, in his official capacity as Director of Department of Environmental Quality, Defendants/Appellees.

No. 1 CA-CV 06-0110.

Court of Appeals of Arizona, Division 1, Department E.

March 6, 2007.

Jeffrey F. Arbetman, Phoenix, Attorney for Plaintiff-Appellant.

Ridenour, Hienton, Kelhoffer, Lewis & Garth, PLLC By Jeffrey A. Bernick, Michele Molinario, Phoenix, Attorneys for Defendant-Appellee State Personnel Board.

Terry Goddard, Attorney General By Michael M. Walker, Assistant Attorney General, Phoenix, Attorney for Defendant-Appellee ADEQ.

OPINION

HALL, Presiding Judge.

¶1 Kenyon Carlson appeals from the superior court's judgment affirming the decision of the Arizona State Personnel Board (the Board) to uphold his dismissal from employment by the Arizona Department of Environmental Quality (ADEQ). Because the Board upheld Carlson's termination for reasons not asserted by ADEQ in its notice of dismissal, we vacate the judgment and remand for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 2 While employed by ADEQ, Kenyon Carlson and Kathleen Gustafson had a consensual intimate relationship. They lived together from July 2001 until August 2002, when Gustafson purchased her own home.

¶ 3 Carlson was a quality assurance manager and directly supervised Gustafson's work as an administrative assistant. He gave Gustafson high ratings on her employee performance appraisals and attempted to help her gain promotions within ADEQ. Both Carlson and Gustafson lied in response to supervisors' inquiries about the nature of their relationship.

¶ 4 Carlson and Gustafson remained friends after their romantic relationship ended in 2002, and Carlson loaned more than $25,000 to Gustafson in 2003. After Carlson began pressing Gustafson for repayment, she blocked him from her home e-mail account. On December 7, 2003, Carlson sent an e-mail from his ADEQ computer to Gustafson's work computer stating that because she had "chosen this direction," he saw no reason to continue working for her promotion. Carlson repeated the substance of this e-mail message in a partially recorded telephone call to Gustafson in January 2004.

¶ 5 In January 2004, Gustafson reported to ADEQ management that Carlson was sexually harassing her. ADEQ put Carlson on administrative leave with pay pending an investigation. Following that investigation, ADEQ issued a Notice of Charges of Misconduct pursuant to Arizona Administrative Code (A.A.C.) R2-5-803, stating:

A dismissal is being considered based on these allegations, which constitute cause for disciplinary action as outlined in A.R.S. § 41-770¹ and Department of Administration Personnel Rule R2-5-501 (Standards of Conduct).²

The letter further provided the following "specific charges and explanations":

In violation of the Department's Sexual Harassment Policy . . . and of the Director's 9/15/03 e-mail . . . renewing the Department's commitment to a harassment free environment:

1. You and Kathleen Gustafson, Administrative Assistant I, had a consensual romantic relationship, which ended. You were aware that Ms. Gustafson was interested in promoting or moving to a different position within ADEQ. You have, at various times, discussed possible positions for Ms. Gustafson with Joe McDonald, including positions in the lab that you supervised. These positions were frozen. The performance planners and appraisals you prepared for Ms. Gustafson indicate that with your encouragement, she was attempting to increase her knowledge and skills in the lab.

On December 3, 2003, after learning that Ms. Gustafson had blocked you from sending e-mail to her personal e-mail account, you sent an e-mail message from your ADEQ e-mail address to her ADEQ e-mail address, stating, in part: "Well, now that you have chosen this direction, I see no reason to continue working for your promotion. . . .

2. You called Kathleen Gustafson and said, pursuant to a recorded message later transcribed, in part: "I would have put all that work into [sic] if I would have had the relationship with you, yes, okay, I admit that, but I'm not willing to do that now. . . ."

Your actions constitute a serious violation of statutes, rules and policies. In determining an appropriate penalty, consideration was give[n] to the fact that you attended ADEQ Workplace Harassment training 10/21/03.

¶ 6 Carlson responded to the charges by submitting a ten-page letter. On April 1, 2004, ADEQ served Carlson with a Notice of Dismissal. The dismissal notice identified the same facts alleged in the Notice of Charges of Misconduct as the reason for termination of employment and cited the same statute and administrative rule. The notice also reiterated that dismissal was considered appropriate because Carlson had attended a training session about sexual harassment in the workplace.

¶ 7 Carlson filed a timely notice of appeal with the Board pursuant to A.R.S. § 41-785(A) (Supp.2006). At his appeal hearing, Carlson attempted to show that, contrary to the findings of misconduct set forth in ADEQ's dismissal notice, he did not engage in "unwelcome sexual conduct or advances" that would constitute sexual harassment and that he had done nothing to injure Gustafson's employment opportunities at ADEQ. He claimed that Gustafson's allegations were motivated by a desire to avoid repayment of money he had lent her. The ADEQ officials testifying at the hearing confirmed that Carlson was discharged for violating the agency's sexual harassment policy based on the specific acts described in the written dismissal notice. In addition, the officials stated that no one had informed Carlson of any other reason for dismissal. Yet, over objection by Carlson's attorney, an ADEQ official testified that Carlson's actions had also violated provisions of the Standards of Conduct that were not specifically asserted as grounds for his termination in the dismissal notice.

¶ 8 The hearing officer agreed with Carlson's claim that he did not make unwelcome sexual advances toward Gustafson and that his cessation of efforts to help Gustafson obtain a promotion simply "level[ed] a playing field which had been improperly tilted in Ms. Gustafson's favor for two years." He concluded that ADEQ had failed to prove that Carlson's conduct constituted sexual harassment as defined by ADEQ policies but found that Carlson had nonetheless violated several Standards of Conduct for state employees by lying about the relationship, giving preferential treatment to Gustafson, and creating a conflict of interest by giving money to Gustafson: R2-5-501(B)(1) (failing to maintain high standards of honesty, integrity, and impartiality free from personal considerations or favoritism); R2-5-501(B)(3) (failing to conduct himself in a manner that would not bring discredit or embarrassment to the State); and R2-5-501(C)(2) (permitting himself to be placed under any kind of personal obligation that could lead a person to expect personal favors).

¶ 9 Although the only reason ADEQ specifically alleged in both its Notice of Charges and Notice of Dismissal was that Carlson violated the agency's sexual harassment policy, the hearing officer concluded that Carlson could be dismissed for other statutory and rule violations not specifically charged because the notices stated that ADEQ had authority to dismiss Carlson pursuant to A.R.S. § 41-770 and the Standards of Conduct. The hearing officer further found that Carlson admitted the facts that established his violations of the Standards of Conduct in his response to the Notice of Charges of Misconduct, belying any argument that he was "unfairly ambushed." Relying on the "right result—wrong reason" rationale that applies to appellate review of trial court judgments, the hearing officer concluded that due process was satisfied because the agency made the correct decision, even if based on the wrong reason. See City of Phoenix v. Geyler, 144 Ariz. 323, 330, 697 P.2d 1073, 1080 (1985) ("We recognize the obligation of appellate courts to affirm where any reasonable view of the facts and law might support the judgment of the trial court. This rule is followed even if the trial court has reached the right result for the wrong reason."). Accordingly, the hearing officer concluded that Carlson's dismissal was not arbitrary, capricious, or otherwise contrary to law and recommended that the Board deny the appeal. See A.R.S. § 41-785(C) ("The board may reverse an agency's action on appeal only if the board finds the actions to be arbitrary, capricious or otherwise contrary to law.").

¶ 10 Carlson filed objections to the hearing officer's Findings of Fact, Conclusions of Law, and Recommendations, asserting he did not receive notice of the charges upon which the hearing officer based his recommendation for dismissal. The Board eventually denied the appeal and adopted the hearing officer's Findings of Fact and Conclusions of Law.³

¶ 11 Carlson filed an administrative review complaint in the superior court pursuant to A.R.S. §§ 12-901 to -913 (2003) and 41-785(F). As did the Board, the superior court rejected Carlson's due process claim and affirmed the Board's decision. Carlson filed a timely notice of appeal to this court. We have jurisdiction pursuant to A.R.S. §§ 12-913 and -2101(B) (2003).

DISCUSSION

¶ 12 On appeal, Carlson argues that the Board erred by affirming his dismissal for reasons other than those given by ADEQ and set forth in the Notice of Charges of Misconduct and Notice of Dismissal. Carlson contends that both the pre-termination and post-termination proceedings were inadequate and violated his right to procedural due process under the Due Process Clause of...