Diamond B Services, Inc. v. Rohde, 04-258.
| Decision Date | 06 October 2005 |
| Docket Number | No. 04-259.,No. 04-258.,04-258.,04-259. |
| Citation | 2005 WY 130,120 P.3d 1031 |
| Parties | DIAMOND B SERVICES, INC., Appellant (Petitioner), v. Lawrence ROHDE, Appellee (Respondent). Lawrence Rohde, Appellant (Defendant), v. Diamond B Services, Inc., Appellee (Plaintiff). |
| Court | Wyoming Supreme Court |
Representing Diamond B Services, Inc.: Terry W. Connolly of Patton & Davison, Cheyenne, Wyoming.
Representing Lawrence Rohde: Steven W. Holland of Huenergardt & Vance, Kimball, Nebraska.
Before HILL, C.J., and GOLDEN, KITE, VOIGT, and BURKE, JJ.
[¶ 1] In these cross appeals, the parties contest the Department of Employment's (Department) order which granted Lawrence Rohde's request for unpaid wages from Diamond B Services, Inc. (Diamond B Services), but denied his request for interest on the unpaid wages, attorney fees, and costs. The district court affirmed the administrative decision.
[¶ 2] We hold the Department had jurisdiction to hear Mr. Rohde's wage claim and there is substantial evidence to support the Department's decision that Mr. Rohde is entitled to be paid his wages. That aspect of the Department's decision is, therefore, affirmed. We conclude, however, the Department is authorized by statute to award interest on the unpaid wages, attorney fees and costs. The Department's decision, holding that it did not have the authority to make those awards is reversed, and we remand for a determination of Mr. Rohde's claims.
[¶ 3] In Case No. 04-258, Diamond B Services presents the following issues for our review:
A. Whether the Department's finding that the Claimant was an employee of Diamond B Services was arbitrary and capricious and unsupported by substantial evidence.
B. Whether the Department improperly created contractual provisions not in accordance with law.
C. Whether the Department misapplied the Wage Offset Rules[.]
D. Whether the Department of Employment Wage Offset Rules, or its interpretation thereof, [are] in derogation of Wyoming Statute.
E. Whether the Department of Employment lacked subject matter jurisdiction to hear this particular wage claim.
Mr. Rohde restates the issues as:
1. Does the Wyoming Department of Employment lose subject matter jurisdiction to take claims for unpaid wages if the employer illegally withholds more than two month[ ]s of wages which were earned by an employee?
2. Is the Wyoming Department of Employment's decision which stated that Lawrence Rohde's claim for unpaid wages is enforceable to the extent of $6,400.00, supported by substantial evidence?
In Case No. 04-259, Mr. Rohde states the following issue:
Is an employee who has quit or has been discharged from service, who has cause to bring suit for wages earned and due, and establishes with the Wyoming Department of Employment the amount which is justly due, entitled to recover interest on the past due wages at the rate of eighteen [percent] (18%) per annum from the date of discharge or termination, together with reasonable attorney fees and all costs of the suit, pursuant to the provisions of W.S. § 27-4-502 (2003) and W.S. § 27-4-104(b) (2003)?
Diamond B Services restates the issue as:
A. Did the hearing officer err in refusing to award Mr. Rohde attorney[] fees, costs and interest[?]
[¶ 4] In 1997 or 1998, Randy Burry contacted Mr. Rohde, who was employed as an automobile mechanic in Grand Island, Nebraska, and asked him to move to Pine Bluffs and work for Diamond B Casing, Inc. (Diamond B Casing). At that time, Diamond B Casing, which was in the business of constructing pipelines and fences, was owned by Randy Burry's brother, Robert Burry.1 Mr. Rohde accepted the offer of employment and moved to Pine Bluffs. On October 27, 1998, Randy Burry's wife, Devota, wrote a check for $3,330.07 from a "Diamond B" account to Home Federal Savings & Loan to pay off Mr. Rohde's truck loan. On December 31, 1999, Mr. Rohde and Randy Burry joined Robert Burry as shareholders in Diamond B Casing. Mr. Rohde contributed his personal tools as consideration for his interest in the company.
[¶ 5] Diamond B Services was incorporated in June 2000, by Randy and Devota Burry. Diamond B Services' home office was located in Pine Bluffs, and it was in the business of providing large trucks to transport automobiles across the country. Mr. Rohde performed mechanic duties for Diamond B Services from the time of its incorporation until he was discharged on December 31, 2002. He earned $3,200 per month for his services, which Diamond B Services paid in bi-monthly payments of $1,600.
[¶ 6] During 2002, Diamond B Services did not pay Mr. Rohde for several pay periods. In December 2002, Randy Burry gave Mr. Rohde a check for $2,500 and informed him that Diamond B Services could no longer afford his services. Mr. Rohde filed a claim with the Department for the remainder of his unpaid wages. Diamond B Services agreed it owed Mr. Rohde $944.94, but disputed the remainder of his claim and requested a contested case hearing.
[¶ 7] A hearing officer for the Department's appeals section held a contested case hearing on November 25 and 26, 2003. Diamond B Services argued that the Department did not have statutory authority to decide Mr. Rohde's wage claim because it exceeded two months wages and Mr. Rohde was an independent contractor rather than an employee. Finally, Diamond B Services argued that, even if the Department had authority to hear Mr. Rohde's wage claim, Diamond B Services was entitled to deduct certain amounts from his checks for monies he owed to the company. Mr. Rohde argued that he was entitled to be paid his wages and requested that the Department award him interest on the unpaid wages, attorney fees and costs.
[¶ 8] The hearing officer found Mr. Rohde was Diamond B Services' employee and the company owed him $8,700 in wages, but ruled that, under statute, it could award a maximum of two months worth of wages, or in this case $6,400. She also concluded that Diamond B Services' wage offset claims were unfounded. The hearing officer denied Mr. Rohde's request for interest on the unpaid wages, attorney fees and costs on the basis that the Department did not have the authority to make such an award.
[¶ 9] Each party filed a petition for review with the district court. The district court affirmed the hearing officer's decision, but stated that Diamond B Services should have been credited with the $944 payment it made to Mr. Rohde. The district court ruled, however, that even with the credit, Mr. Rohde's claim was valid for more than the $6,400 maximum and the hearing officer's ruling should, therefore, stand. Diamond B Services appealed in Case No. 04-258, and Mr. Rohde appealed in Case No. 04-259. We consolidated the cases for review.
[¶ 10] As with all decisions from administrative agencies, the Wyoming Administrative Procedures Act governs this Court's review of decisions from the Department. See DC Production Service v. Department of Employment, 2002 WY 142, ¶ 6, 54 P.3d 768, 771 (Wyo.2002). Our review of agency decisions is limited to those considerations specified in Wyo. Stat. Ann. § 16-3-114(c) (LexisNexis 2005) which provides in pertinent part:
(c) To the extent necessary to make a decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. In making the following determinations, the court shall review the whole record or those parts of it cited by a party and due account shall be taken of the rule of prejudicial error. The reviewing court shall:
. . .
(ii) Hold unlawful and set aside agency action, findings and conclusions found to be:
(A) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;
. . .
(E) Unsupported by substantial evidence in a case reviewed on the record of an agency hearing provided by statute.
[¶ 11] In KG Construction, Inc. v. Sherman, 2005 WY 116, 120 P.3d 145, we reiterated our standard for reviewing an administrative agency's findings of fact:
The substantial evidence test is the appropriate standard of review in appeals from contested case proceedings when factual findings are involved and both parties submit evidence. Robbins v. State ex rel. Wyo. Workers' Safety & Comp. Div., 2003 WY 29, ¶ 18, 64 P.3d 729, 732 (Wyo.2003). Substantial evidence is relevant evidence which a reasonable mind might accept in support of the agency's conclusions. It is more than a scintilla of evidence. Even if the factual findings are found to be supported by substantial evidence, the ultimate agency decision may still be found to be arbitrary or capricious for other reasons. An appellate court does not examine the record only to determine if there is substantial evidence to support the agency's decision, but it also must examine the conflicting evidence to determine if the hearing examiner could have reasonably made its finding and order upon all of the evidence before it. Newman v. State ex rel. Wyoming, Workers' Safety and Compensation Div., 2002 WY 91, ¶ 24, 49 P.3d 163, 172 (Wyo.2002).
[¶ 12] An administrative agency's conclusions of law are not entitled to the same deference as its factual findings. We review an agency's conclusions of law de novo, and "[w]e will affirm an agency's legal conclusion only if it is in accordance with the law." DC Production Service, ¶ 7.
[¶ 13] Diamond B Services insists that the Department did not have subject matter jurisdiction to hear Mr. Rohde's claim for unpaid wages. We will consider this issue first because subject matter jurisdiction is an issue of such magnitude. "The issue of subject matter jurisdiction is so fundamental that it cannot be waived, can be raised on the...
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