Crocker v. Maine Employment Sec. Com'n

• Decision Date: 07 September 1982
• Citation: 450 A.2d 469
• Parties: Carroll C. CROCKER v. MAINE EMPLOYMENT SECURITY COMMISSION.
• Court: Maine Supreme Court

Page 469

450 A.2d 469

Carroll C. CROCKER v. MAINE EMPLOYMENT SECURITY COMMISSION.

Supreme Judicial Court of Maine.

Argued March 12, 1982.

Decided Sept. 7, 1982.

Downeast Law Offices, P. A. by Richard M. Goldman (orally), Kim M. Vandermeulen, Augusta, for plaintiff.

Susan P. Herman, Asst. Atty. Gen. (orally), Augusta, for defendant.

Before McKUSICK, C. J., GODFREY, NICHOLS, ROBERTS, VIOLETTE and WATHEN, JJ., and DUFRESNE, A. R. J.

DUFRESNE, Active Retired Justice.

The plaintiff, Carroll Crocker, appeals from a judgment of the Superior Court, Kennebec County, affirming a decision of the Maine Employment Security Commission (MESC), which terminated the plaintiff's receipt of unemployment benefits, established a one year prospective ineligibility to receive any benefits, retrospectively disqualified him and ordered him to remit $936.00 in overpayments. Crocker argues that the Commission erred in finding that he made false statements or representations knowing them to be false and that he knowingly failed to disclose material facts in his applications to obtain benefits. He further claims that the Commission abused its discretion in imposing penalties against him. We reverse.

I.

The plaintiff, Carroll Crocker, applied for unemployment benefits on June 16, 1980, after he was laid off, through no fault of his own, by Baker Bus Service, where he had been employed as a mechanic for five years. He received $104.00 per week from June 21, 1980, until August 16, 1980, when a deputy of the Maine Employment Security Commission declared him ineligible. The deputy found, among other things, that the plaintiff had "knowingly made false statements, knowing them to be false and failed to disclose material facts in [his] applications for benefits." The Appeal Tribunal's decision in affirming the deputy's conclusions stated its findings as follows:

[T]he claimant made false statements or representations knowing them to be false and knowingly failed to disclose material facts in his application to obtain benefits, within the meaning of Section 1193-6 of the Employment Security Law. Further, the claimant received benefits to which he was not entitled while conditions for the receipt of benefits imposed were not fulfilled in his case, within the meaning of Section 1051-4 of the Employment Security Law. (Emphasis provided).

These findings were the basis, in turn, of the Commission's affirmance of the Appeal Tribunal's decision upholding the deputy's action and of the Superior Court's adjudication that the Commission decision was legally correct. The appeal to this Court brings into focus the significance of the plaintiff's activities over the course of the summer during which Crocker was collecting unemployment compensation benefits.

In late May, 1980, the plaintiff and his wife jointly obtained a license for and opened up a business, the Lakeview Bait & Tackle Shop, in rented accommodations in Winthrop. At that time, they did not know that the plaintiff would be laid off. Mrs. Crocker had quit her job in a nursing home in order to run the shop. While the plaintiff was working at the bus company, his wife would open the store in the morning around 6:30 a. m.; the plaintiff would then relieve her in late afternoon and work until 8:30 p. m. He built a tank in which to store the live bait. He kept the books until June 13th, when he stopped working at the bus company. After June 13th, his participation in the business changed.

During the months the plaintiff was collecting unemployment benefits, he did not work at the store or keep the books. Several times a week, however, he drove his nephew to ponds where the boy caught bait to be sold in the bait shop. At first, he did show his nephew how to catch each kind of bait. This task of securing bait required two to three hours each day the plaintiff took his nephew to the ponds. The plaintiff, in a statement made to the MESC on August 25, 1980, stated: "All I do is spend 2 or 3 hours a day supervising & overseeing the business operations to include 2 or 3 hours a day fishing or procuring the bait supply." Apparently basing his decision on this statement, the deputy found that the plaintiff knowingly had falsely stated in his weekly applications for unemployment compensation benefits that he had not worked or earned wages in each of the several weeks involved and that he was able and available for work on each day during that time. He further found that, by reason of his self-employment and unavailability for other work during the reference weeks, Crocker knowingly had failed to disclose material facts in his applications. The deputy ruled that the plaintiff was in violation of sections 1193(6), 1051(1) and 1051(4) of the Employment Security Law.

The plaintiff appealed the deputy's decision to the Appeal Tribunal and a hearing was held on September 23, 1980. At that hearing, Mr. Crocker stated that he had been available for work during the summer and had not knowingly withheld any material information. He testified he had not received any wages from the business, ¹ and, insofar as his participation in the bait gathering was concerned, he said that he only "walked around or read a book" while his nephew caught the bait. The hearing examiner asked the plaintiff why he considered his services for the shop prior to being laid off as "work," but considered the task of driving his nephew around for bait catching, not to be "work," even though he received no wages in either case. The plaintiff, after apparently becoming confused about these distinctions, replied that what he did before being laid off could be called work, and he called it work. None of this testimony was contradicted, since the Crockers were the only witnesses at the hearing.

On October 3, 1980, the Appeal Tribunal issued its decisions affirming the deputy's findings. On appeal to the Commission, the MESC affirmed and adopted the Appeal Tribunal's decisions.

The plaintiff seasonably filed a complaint in the Superior Court, Kennebec County, pursuant to 26 M.R.S.A. § 1194(8) and 5 M.R.S.A. § 11001 et seq., alleging that the decisions were contrary to law and to all credible evidence, and that, in addition thereto, the ensuing penalty was arbitrary.

While the plaintiff's Superior Court petition for review of the agency action was pending, the parties to this appeal submitted a partial consent decree to the Superior Court, in which they agreed that the decisions concerning the plaintiff's availability for work and his employment status had been erroneous and should be reversed. The Court so ordered on June 1, 1981. Following a hearing, the decision of the Commission to the effect that the plaintiff had violated 26 M.R.S.A. § 1051(4) and § 1193(6) was affirmed on September 11, 1981, the Court concluding on a review of the record that

1. The decision and facts found by the Maine Employment Security Commission are supported by substantial evidence in the record.

2. With its findings the Commission did not err, as a matter of law, in reaching its decision, nor did it abuse its discretion in disqualifying the petitioner from receiving benefits for one year.

The plaintiff has seasonably appealed the decision of the Superior Court.

II.

Initially, we recognize that, in reviewing a decision of the Employment Security Commission, the Law Court will examine the record to determine whether there exists any competent evidence to support the agency findings and then ascertain whether upon those findings the applicable law has been correctly applied. Shone v. Maine Employment Security Commission, Me., 441 A.2d 282, 283 (1982); Tobin v. Maine Employment Security Commission, Me., 420 A.2d 222, 224-25 (1980). On judicial review, the court is without authority to overrule findings of fact made by an administrative agency when those findings are supported by substantial evidence, i.e. such relevant evidence as a reasonable mind might accept as adequate to support the resultant conclusion. Sanford Highway Unit v. Town of Sanford, Me., 411 A.2d 1010, 1014 (1980).

III.

The Superior Court's affirmance of the agency action in the instant case must be viewed and evaluated in the light of the parties' approved stipulation to the effect that the administrative decision was erroneous in two basic aspects of alleged specific ineligibility under the Employment Security Law. In other words, the Commission by the stipulation was conceding that the plaintiff's furnishing of his services in driving his nephew to the several ponds to gather bait for the bait and tackle shop operated by his wife and licensed as a joint business venture did not in fact and law render him unavailable for work, and that, notwithstanding such services, Crocker was available for work within the meaning of the eligibility requirements of 26 M.R.S.A. § 1192(3). ² Also, the Commission was admitting that the furnishing of the reference services did not in fact and law nullify his unemployment status, another prerequisite of unemployment benefit eligibility pursuant to said section 1192. See note 2.

The ultimate order of the Superior Court, fully affirming the underlying agency findings and adjudications, served to reassert, as if specifically incorporated therein, the basic agency findings articulated in the decision of the Appeal Tribunal which we now requote:

It is the finding of this Tribunal that the claimant made false statements or representations knowing them to be false and knowingly failed to disclose material facts in his application to obtain benefits, within the meaning of Section 1193(6) of the Employment Security Law. Further, the claimant received benefits to which he was not entitled while conditions for the receipt of benefits imposed were not fulfilled in his case, within the meaning of Section 1051(4) of the Employment Security Law. (Emphasis supplied). ³

The record of the hearing at the Appeal Tribunal level indicates that the claimant's answers,...