Dep't of Revenue, Fin., & Admin. Cabinet v. Wade

• Decision Date: 20 September 2012
• Docket Number: No. 2011–SC–000095–DG.,2011–SC–000095–DG.
• Citation: 379 S.W.3d 134
• Parties: DEPARTMENT OF REVENUE, FINANCE, AND ADMINISTRATION CABINET, et al., Appellants v. Wanda Faye WADE, et al., Appellees.
• Court: United States State Supreme Court — District of Kentucky

379 S.W.3d 134

DEPARTMENT OF REVENUE, FINANCE, AND ADMINISTRATION CABINET, et al., Appellants
v.
Wanda Faye WADE, et al., Appellees.

No. 2011–SC–000095–DG.

Supreme Court of Kentucky.

Sept. 20, 2012.

[379 S.W.3d 136]

Travis Alan Powell, Frankfort, KY, Counsel for Appellants.

Paul F. Fauri, Frankfort, KY, Counsel for Appellee, Wanda Faye Wade.

Mark A. Sipek, Boyce Andrew Crocker, Kentucky Personnel Board, Frankfort, KY, Counsel for Appellee, Personnel Board, Commonwealth of Kentucky.

Opinion of the Court by Justice SCOTT.

This case requires us to determine whether a state employee, after receiving notice of her employer's intent to dismiss her, waives her right to a pre-termination hearing by repeatedly engaging in conduct that delays the hearing. The Kentucky Personnel Board concluded that Appellee, Wanda Faye Wade, did not waive her right to a pre-termination hearing, and that her dismissal therefore violated her right to due process. The Franklin Circuit Court and Kentucky Court of Appeals agreed with this conclusion and affirmed. We granted discretionary review and now reverse.

I. BACKGROUND¹

Wade worked for the Kentucky Department of Revenue's Finance and Administration Cabinet (“the Cabinet”) for thirty-seven years. By letter dated February 14, 2005, the Cabinet notified Wade of its intent to terminate her employment for lack of good behavior and unsatisfactory work performance. A subsequent nine-page letter detailed the reasons for her dismissal, including: (1) routine misreporting of her arrival time; (2) failure to abide by office rules; (3) continued inability to respect supervisory staff; (4) careless work habits which had a negative effect on her work performance and productivity; and (5) inability to perform the essential functions of her job in a satisfactory manner. Specific examples of each were provided in the letter.

Attached to the February 14 letter was a form advising Wade that she had five days to request a pre-termination hearing. Through her first attorney, David Emerson, Wade timely requested the hearing which was scheduled for February 23, 2005.

However, on February 16, Wade informed the Cabinet that she had been injured and could not return to work. Soon thereafter, Emerson requested that the pre-termination hearing be postponed, and the Cabinet agreed to reschedule the hearing for February 28, 2005.

Despite Wade's alleged inability to work due to injury, she walked to the Office of the Secretary of the Finance and Administration Cabinet on February 18. She demanded to see the Deputy Secretary in an effort to dissuade the Cabinet from dismissing her. However, she was instead

[379 S.W.3d 137]

escorted to the office of the Cabinet's counsel where she called Emerson who advised her to leave the premises.

On February 25—three days before the rescheduled hearing—Emerson again asked to postpone the hearing. This time, he provided a doctor's note asking that Wade be excused from work or a hearing between the dates of February 16 and March 9, 2005. Emerson informed the Cabinet's counsel that Wade's doctor advised her to be “off her legs” and remain at home until she could see an orthopedic surgeon. The Cabinet's counsel once again agreed to postpone the hearing on the condition that Emerson contact her no later than March 9, 2005 to reschedule the hearing. However, Emerson never called.

Instead, at the end of the workday on March 9, 2005, the Cabinet's counsel called Emerson to discuss rescheduling the hearing. Emerson informed counsel that he had faxed her some documents to review. These documents were (1) a Family and Medical Leave Act (FMLA) “Certification of Health Care Provider” signed by Wade's orthopedic surgeon, and (2) an application for ninety-days of medical leave under the FMLA, signed by Wade and approved that same day by the Cabinet's payroll branch manager.² Emerson informed the Cabinet's counsel that Wade's physician did not want her to attend a hearing until after June 9, 2005—the date on which her FMLA leave would end. Once Emerson indicated that he was not going to reschedule the hearing, the Cabinet's counsel told him: “You leave me no choice but to proceed with termination.” Emerson replied: “Do what you have to do.”

The next day, March 10, 2005, the Cabinet issued Wade a notice of termination. In the notice, the Cabinet informed Wade that it considered her to have waived her right to a pre-termination hearing.

After hiring a new attorney, Wade timely appealed to the Personnel Board. Relevant to this appeal, the Hearing Officer entered the following finding of fact:

Wade did not intend to waive the pre-termination hearing, but attempted to delay it for as long as she could by using the Family and Medical Leave Act as a shield from the impending pre-termination hearing.

The Hearing Officer then concluded that “Wade, although she temporized and delayed the process, did not waive her constitutional right to a pre-termination hearing.” Accordingly, it determined that her right to due process was violated. The Personnel Board accepted the Hearing Officer's findings and conclusions, and adopted his recommendations. In a subsequent Order, the Personnel Board awarded Wade back pay.

On consecutive appeals, the Franklin Circuit Court and the Court of Appeals affirmed. We subsequently granted discretionary review to address the question of whether a state employee may be deemed to have waived a pre-termination hearing, without subjectively intending to do so, by deliberately and repeatedly engaging in conduct that delays the hearing.

Additional facts will be provided where helpful to our analysis.

II. ANALYSIS

A classified employee of the Commonwealth's executive branch has a property interest in her continued employment. See

[379 S.W.3d 138]

Faust v. Commonwealth, 142 S.W.3d 89, 94 (Ky.2004); KRS 18A.095. ³ The Commonwealth may not deprive her of her property interest by terminating her employment without due process of law. U.S. Const. amend XIV, § 1 (“[N]or shall any state deprive any person of life, liberty, or property, without due process of law”); Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 538, 105 S.Ct. 1487, 84 L.Ed.2d 494 (1985). “The essential requirements of due process ... are notice and an opportunity to respond.” Id. at 546, 105 S.Ct. 1487. The “ ‘root requirement’ of the Due Process Clause [is] ‘that an individual be given an opportunity for a hearing before he is deprived of any significant property interest.’ ” Id. at 542, 105 S.Ct. 1487 ( quoting Boddie v. Connecticut, 401 U.S. 371, 379, 91 S.Ct. 780, 28 L.Ed.2d 113 (1971)). However, in certain circumstances, “a post-deprivation hearing will satisfy due process requirements.” Id. at n. 7 ( citing Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594, 70 S.Ct. 870, 94 L.Ed. 1088 (1950); N. Am. Cold Storage Co. v. Chicago, 211 U.S. 306, 29 S.Ct. 101, 53 L.Ed. 195 (1908)).

The United States Supreme Court has recognized that “[d]ue process does not, of course, require that the defendant in every civil case actually have a hearing on the merits.” Boddie, 401 U.S. at 378, 91 S.Ct. 780. Rather, the due process inquiry focuses only on the opportunity to be heard, Loudermill, 470 U.S. at 542, 105 S.Ct. 1487; that right, however, may be waived. See D.H. Overmyer Co. Inc., of Ohio v. Frick Co., 405 U.S. 174, 185, 92 S.Ct. 775, 31 L.Ed.2d 124 (1972) (“The due process rights to notice and hearing prior to a civil judgment are subject to waiver.”). “A State, can, for example, enter a default judgment against a defendant who, after adequate notice, fails to make a timely appearance....” Boddie, 401 U.S. at 378, 91 S.Ct. 780 ( citing Windsor v. McVeigh, 93 U.S. 274, 278, 23 L.Ed. 914 (1876)).

A. The Waiver Standard

To begin with, the law appears to be somewhat unsettled with respect to the proper waiver standard applicable to a property right case. In Overmyer, the U.S. Supreme Court addressed the issue of whether a party can contractually waive, in advance, the due process rights to notice and a hearing. 405 U.S. at 184–85, 92 S.Ct. 775. The Court assumed, without deciding, that the criminal waiver standard—which requires a waiver to be knowingly, voluntarily, and intelligently made, Miranda v. Arizona, 384 U.S. 436, 444, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966)—also applied to property right cases. Id. at 186, 92 S.Ct. 775. The Court has not subsequently announced a different waiver standard for property right cases, so we will assume that the criminal waiver standard applies here.

As recited in Overmyer, the standard applicable to this case requires the waiver to be “voluntary, knowing, and intelligently made,” and that it must be “an intentional relinquishment or abandonment

[379 S.W.3d 139]

of a known right or privilege.” Id. (citations and internal quotation marks omitted). Until now, this Court has not had the occasion to consider the circumstances under which an individual may be deemed to have waived her opportunity to be heard prior to termination of her employment. And although we cannot find a case from any jurisdiction that addresses the specific issue presented by this case, we look to our sister courts for guidance.

In Birdwell v. Hazelwood School District, the Eighth Circuit found a valid waiver of the right to a pre-termination hearing. 491 F.2d 490, 495 (8th Cir.1974). In that case, the appellant, a public school teacher, was suspended after confronting R.O.T.C. personnel in front of students. Id. at 492. The district superintendent invited him to participate in a pre-termination hearing but, on advice of counsel, the appellant did not attend. Id. at 493. At the hearing, the school board unanimously voted to terminate his employment. Id. The Eighth Circuit concluded that the appellant had been provided constitutionally sufficient notice and an opportunity to be heard. Id. at 495. However, he “deliberately chose not to avail himself of it....” Id.

Similarly, in Cliff v. Board of School Commissioners of the...