Granger v. University of Nc at Chapel Hill, COA08-992.

• Decision Date: 07 July 2009
• Docket Number: No. COA08-992.,COA08-992.
• Citation: 678 S.E.2d 715
• Parties: Pamela C. GRANGER, Petitioner-Appellant, v. UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL, Respondent-Appellee.
• Court: North Carolina Court of Appeals

678 S.E.2d 715

Pamela C. GRANGER, Petitioner-Appellant, v. UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL, Respondent-Appellee.

No. COA08-992.

Court of Appeals of North Carolina.

July 7, 2009.

Appeal by Petitioner from order entered 21 April 2008 by Judge R. Allen Baddour, Jr. in Superior Court, Wake County. Heard in the Court of Appeals 10 March 2009.

Law Offices of Michael C. Byrne, P.C., by Michael C. Byrne, Raleigh, for Petitioner-Appellant.

Attorney General Roy Cooper, by Assistant Attorney General Kimberly D. Potter, for Respondent-Appellee.

McGEE, Judge.

Respondent dismissed Petitioner, a career employee, on 19 August 2005, on the basis of Petitioner's unacceptable personal conduct. Isabelle Jones-Parker (Jones-Parker), an African-American and also an employee of Respondent, who was under the direct supervision of Petitioner, sent Respondent a letter in June 2005 arguing, inter alia, that Petitioner had subjected Jones-Parker to "racism, harassment and workplace hostility." In response to Jones-Parker's letter, Respondent appointed three investigators to investigate Petitioner's allegations: Karen Silverberg, Assistant Dean for Human Resources for the UNC School of Medicine; Gena Carter, UNC Chapel Hill Human Resources Team Leader; and Joanna Carey Smith, a member of the UNC Chapel Hill Office of General Counsel (the investigators). In the course of their investigation, the investigators obtained statements from other employees under Petitioner's direct supervision. One of those employees, Susan Huey (Huey) stated that she had overheard Petitioner refer to Jones-Parker as "that n____" as Petitioner was leaving Petitioner's office. Petitioner, upon being informed of Huey's statement, admitted she had used the epithet in reference to Parker-Jones, explaining that she knew it was inappropriate. Petitioner stated it had been an expression of her anger due to the investigation, and that she had only used the epithet once, while speaking to her sister on the phone, and had not meant for anyone in the office to overhear it. Another employee, Betty Satterfield (Satterfield), stated that Petitioner had told her Petitioner would never hire another black person. Satterfield also reported she witnessed Petitioner taking a workbook belonging to Jones-Parker that contained work on Black History month that Jones-Parker was compiling for her church. Satterfield further stated that Petitioner informed her that Petitioner had instructed Petitioner's boyfriend to dispose of the notebook. In addition, Satterfield stated that Petitioner continually spoke with her concerning the ongoing investigation, attempting to elicit information, and instructing Satterfield how to respond to questioning. Both Huey and Satterfield stated Petitioner created a hostile work environment by continually referring to Petitioner's contacts with Respondent, and Petitioner's ability to use those contacts to punish employees who crossed Petitioner. Petitioner admitted to using the racial slur against Jones-Parker, but denied the other allegations.

The end result of the investigation was the dismissal of Petitioner. Petitioner completed Respondent's internal grievance process without success, and filed a petition for a contested case with the Office of Administrative Hearings on 5 January 2006. Administrative Law Judge (ALJ) Beecher Gray heard the case on 20-21 September 2006, and on 22 December 2006, the ALJ filed his decision in which he concluded Petitioner was improperly dismissed. Respondent appealed to the State Personnel Commission. The State Personnel Commission overturned the ALJ's decision by final decision entered 2 April 2007. Petitioner filed for judicial review, and the matter was heard by the trial court in Wake County Superior Court on 6 December 2007. By order entered 21 April 2008, the trial court affirmed the final decision of the State Personnel Commission. Petitioner appeals.

In Petitioner's arguments, she contends the trial court erred in concluding (1) that one use of a racial slur under these circumstances constituted unacceptable personal conduct, and thus provided just cause for dismissal; (2) that Petitioner's discussions with other employees about the investigation amounted to interference with that investigation, and thus insubordination; and (3) that Petitioner's statement that she would not hire another black person, Petitioner's discarding of Jones-Parker's Black History notebook, and Petitioner's creation of a "general sense of intimidation in the workplace" constituted unacceptable personal conduct, and thus just cause for dismissal. We disagree.

We observe that ... subsection 150B-51(c) requires a reviewing court to engage in independent "de novo" fact-finding in all contested cases ... where the agency fails to adopt the ALJ's initial decision. Subsection 150B-51(c) provides, in pertinent part: "In reviewing a final decision in a contested case in which an administrative law judge made a decision, in accordance with G.S. 150B-34(a), and the agency does not adopt the administrative law judge's decision, the [trial] court shall review the official record, de novo, and shall make findings of fact and conclusions of law. In reviewing the case, the [trial] court shall not give deference to any prior decision made in the case and shall not be bound by the findings of fact or the conclusions of law contained in the agency's final decision." N.C.G.S. § 150B-51(c) (2003) (emphasis added).

N.C. Dep't of Env't & Natural Res. v. Carroll, 358 N.C. 649, 662-63, 599 S.E.2d 888, 897 (2004) (internal citations omitted).

The [trial] court shall determine whether the petitioner is entitled to the relief sought in the petition, based upon its review of the official record. The [trial] court reviewing a final decision under this subsection may adopt the administrative law judge's decision; may adopt, reverse, or modify the agency's decision; may remand the case to the agency for further explanations under G.S. 150B-36(b1), 150B-36(b2), or 150B-36(b3), or reverse or modify the final decision for the agency's failure to provide the explanations; and may take any other action allowed by law.

N.C. Gen.Stat. § 150B-51(c) (2008).

"When this Court reviews appeals from superior court either affirming or reversing the decision of an administrative agency, our scope of review is twofold ...: (1) whether the superior court applied the appropriate standard of review and, if so, (2) whether the superior court properly applied this standard."

Corbett v. N.C. DMV, 190 N.C.App. 113, 118, 660 S.E.2d 233, 237 (2008). "In cases reviewed under G.S. 150B-51(c), the [trial] court's findings of fact shall be upheld if supported by substantial evidence." N.C. Gen.Stat. § 150B-52 (2008). "`Substantial evidence is such "relevant evidence as a reasonable mind might accept as adequate to support a conclusion,"' even if contradictory evidence may exist." Cape Med. Transp., Inc. v. N.C. Dep't of Health & Human Servs., 162 N.C.App. 14, 22, 590 S.E.2d 8, 14 (2004) (internal citations omitted); see also Rainey v. N.C. Dep't of Pub. Instruction, 181 N.C.App. 666, 671, 640 S.E.2d 790, 794 (2007), rev. on other grounds by Rainey v. N.C. Dep't of Pub. Instruction, 361 N.C. 679, 652 S.E.2d 251 (2007); Enoch v. Alamance County Dep't of Soc. Servs., 164 N.C.App. 233, 250, 595 S.E.2d 744, 757 (2004).

Because the case before us involves a situation where the final agency decision rejected the decision of the ALJ, the appropriate standard of review for the trial court was de novo. Carroll, 358 N.C. at 662-63, 599 S.E.2d at 897. The trial court stated the correct standard of review in its order. [R.p. 181] We must now decide whether the trial court properly applied that standard of review. Corbett, 190 N.C.App. at 118, 660 S.E.2d at 237.

At the time of her dismissal, Petitioner was a career state employee as defined by Chapter 126 of the North Carolina General Statutes: the "State Personnel Act."

(a) Any employee, regardless of occupation, position or profession may be warned, demoted, suspended or dismissed by the appointing authority. Such actions may be taken against career employees as defined by the State Personnel Act, only for just cause. The provisions of this section apply only to employees who have attained career status. The degree and type of action taken shall be based upon the sound and considered judgment of the appointing authority in accordance with the provisions of this Rule. When just cause exists the only disciplinary actions provided for under this Section are:

(1) Written warning;

(2) Disciplinary suspension without pay;

(3) Demotion; and

(4) Dismissal.

(b) There are two bases for the discipline or dismissal of employees under the statutory standard for "just cause" as set out in G.S. 126-35. These two bases are:

(1) Discipline or dismissal imposed on the basis of unsatisfactory job performance, including grossly inefficient job performance.

(2) Discipline or dismissal imposed on the basis of unacceptable personal conduct.

(c) Either unsatisfactory or grossly inefficient job performance or unacceptable personal conduct as defined in 25 NCAC 1J.0614 of this Section constitute just cause for discipline or dismissal. The categories are not mutually exclusive, as certain actions by employees may fall into both categories, depending upon the facts of each case. No disciplinary action shall be invalid solely because the disciplinary action is labeled incorrectly.

(d) The imposition of any disciplinary action shall comply with the procedural requirements of this Section.

25 N.C.A.C. 1J.0604 (2008) (emphasis added). Petitioner was dismissed based upon a finding of unacceptable personal conduct, which is defined in relevant part as: "conduct for which no reasonable person should expect to receive prior warning"; "the willful violation of known or written work rules"; "conduct unbecoming a state employee that is detrimental to state...