Greenen v. Wash. State Bd. of Accountancy, 31320-1-II.

• Decision Date: 12 April 2005
• Docket Number: No. 31320-1-II.,31320-1-II.
• Court: Washington Court of Appeals
• Parties: Marilyn GREENEN, Appellant, v. WASHINGTON STATE BOARD OF ACCOUNTANCY, Respondent.

110 P.3d 224

126 Wash.App. 824

Marilyn GREENEN, Appellant, v. WASHINGTON STATE BOARD OF ACCOUNTANCY, Respondent.

No. 31320-1-II.

Court of Appeals of Washington, Division 2.

April 12, 2005.

As Amended May 24, 2005.

James Joseph Rigos, Attorney at Law, Seattle, WA, for Appellant.

Diane L. McDaniel, Attorney at Law, Olympia, WA, for Respondent.

VAN DEREN, J.

¶ 1 Marilyn Greenen appeals the Washington State Board of Accountancy's (Board) final order disciplining her for misrepresentations on health insurance forms while employed at a state agency as an account manager and licensed Certified Public Accountant (CPA). Greenen argues that the Board lacked jurisdiction to discipline her under former RCW 18.04.295(2) (1992) and former WAC 4-25-910(2)(a)(ii)-(iii) (1994). Because former RCW 18.04.295(2)'s plain language, statutory scheme, and legislative intent provide the Board authority to discipline Greenen under the specific facts here and she fails to demonstrate that the Board's final order was arbitrary or capricious, we affirm.

FACTS

A. Background

¶ 2 In October 1993, Greenen began working at the Port of Vancouver (Port) as an account manager. She was a licensed CPA at all times during her employment with the Port. Before working at the Port, she worked for three years at the Washington State Auditor's Office. Greenen was not directly engaged in public accounting in her account manager position at the Port; however, she oversaw the preparation of financial statements and supervised employees with accounting duties.

¶ 3 When she started working at the Port, Greenen was married but had recently filed a dissolution petition and she had one dependent child. Because the Port is a state agency, Greenen could obtain health insurance benefits for her husband and child through the state's medical plan. Greenen received the Port's employee benefits booklet that explained eligibility rules for dependents and a copy of the Port's policy on insurance benefits that stated, "[e]mployees are responsible for notifying the Port on approved enrollment forms of their eligible dependents. Any extra costs associated with a lack of notification shall be the employee's responsibility." Administrative Record/Clerk's Papers (AR/CP) at 709.

¶ 4 Her marriage was dissolved in November 1993, about five weeks after she enrolled her husband for health insurance benefits under the state medical plan.¹ Nothing in Greenen's dissolution decree required her to provide health insurance to her former spouse. For over four and a half years, Greenen failed to notify the Port of her change in marital status and she did not update her health insurance information.

¶ 5 Then, in May 1998, her supervisor confronted her about the marriage dissolution. Her supervisor required her to submit an updated health insurance form to remove her former spouse's eligibility for medical benefits and to provide the date of her divorce. Greenen submitted an incomplete form that identified her as single but failed to provide the date of her divorce decree. Greenen's revised form also stated "delete spouse effective... May 31, 1998," because this information was "[n]o longer applicable." AR/CP at 684. When the form was returned for lack of a required dissolution date, Greenen indicated that she would take care of it; however, the Port did not receive a properly updated health insurance form.

¶ 6 About one year later, in April 1999, the Port again asked Greenen to submit an updated health insurance form because the state continued to incur costs for her former spouse's medical coverage. Greenen submitted another inaccurate form that asserted the date of her former spouse's ineligibility was May 31, 1998, because of an "agreement to cover ex-spouse expired as of 5/31/98." AR/CP at 685. Soon after, the Port terminated Greenen's employment with a mutual release of all claims. The Port paid approximately $4,500 in additional premiums for the unauthorized medical coverage of Greenen's former spouse. Greenen eventually reimbursed the Port for this amount.

B. Procedural History

¶ 7 The Board filed a Statement of Charges against Greenen in September 2000, alleging six violations under the Public Accountancy Act (Act), former chapter 18.04 RCW (1992),² and related provisions of the WAC. The Board held a hearing that included the testimony of Greenen and two additional witnesses.

¶ 8 In November 2002, the Board issued a final order that exonerated Greenen of four charges, but disciplined her under former RCW 18.04.295(2)³ and former WAC 4-25-910(2)(a)(ii)-(iii)⁴ for fiscal dishonesty and misleading representations while representing herself as a CPA. The Board's final order required Greenen to take a CPA ethics exam, to take an ethics course, and to pay a fine of $1,000 and 80 percent of the Board's investigative and legal costs.

¶ 9 Greenen moved for reconsideration, which the Board denied. Greenen filed a petition for review of the Board's final order in Thurston County Superior Court. The court affirmed the Board's final order and denied Greenen's motion for reconsideration.

ANALYSIS

I. STANDARD OF REVIEW

¶ 10 We review a final agency order under RCW 34.05.570(3). The party challenging an agency's action must prove the decision's invalidity and our review is limited to the record before the agency. RCW 34.05.570(1)(a); RCW 34.05.558; Port of Seattle v. Pollution Control Hearings Bd., 151 Wash.2d 568, 587, 90 P.3d 659 (2004). We may grant relief to the petitioner based on an agency's erroneous interpretation of the law or an agency decision that is arbitrary or capricious. Pub. Util. Dist. No. 1 of Pend Oreille County v. Dep't of Ecology, 146 Wash.2d 778, 790, 51 P.3d 744 (2002).

¶ 11 We review a challenge to an agency's statutory interpretation and legal conclusions de novo under the error of law standard. Bond v. Dep't of Soc. & Health Servs., 111 Wash.App. 566, 571-72, 45 P.3d 1087 (2002). Regarding "an ambiguous statute which falls within the agency's expertise, the agency's interpretation of the statute is accorded great weight, provided it does not conflict with the statute." Pub. Util. Dist. No. 1 of Pend Oreille County, 146 Wash.2d at 790, 51 P.3d 744. But we do not defer to an agency's determination of its scope of authority. Campbell v. Dep't of Social & Health Servs., 150 Wash.2d 881, 894 n. 4, 83 P.3d 999 (2004).

¶ 12 We evaluate a statute's plain language to determine legislative intent. Campbell, 150 Wash.2d at 894, 83 P.3d 999. If the plain language is ambiguous, we may review the statute's legislative history, including legislative bill reports, to help determine a statute's intent. Dep't of Ecology v. Campbell & Gwinn, L.L.C., 146 Wash.2d 1, 11-12, 43 P.3d 4 (2002); Brown v. City of Yakima, 116 Wash.2d 556, 562, 807 P.2d 353 (1991). We examine the statute as a whole and our statutory interpretation must not create an absurd result. Pub. Util. Dist. No. 1 of Pend Oreille County, 146 Wash.2d at 791, 51 P.3d 744; Strain v. W. Travel, Inc., 117 Wash. App. 251, 254, 70 P.3d 158 (2003), review denied, 150 Wash.2d 1029, 82 P.3d 243 (2004).

¶ 13 An agency order is arbitrary or capricious "if it is willful, unreasoning, and issued without regard to or consideration of the surrounding facts and circumstances." Manke Lumber Co. v. Cent. Puget Sound Growth Mgmt. Hearings Bd., 113 Wash.App. 615, 623, 53 P.3d 1011 (2002), review denied, 148 Wash.2d 1017, 64 P.3d 649 (2003). The party challenging an agency order "carries a heavy burden" to persuade an appellate court that the agency decision is erroneous. Brown v. Dep't of Health, Dental Disciplinary Bd., 94 Wash.App. 7, 16, 972 P.2d 101 (1999) (quoting Keene v. Bd. of Accountancy, 77 Wash.App. 849, 859, 894 P.2d 582 (1995)). If the appellant does not assign error to the agency's findings of fact in the final order, these facts are verities on appeal. Tapper v. Employment Sec. Dep't, 122 Wash.2d 397, 407, 858 P.2d 494 (1993).

II. BOARD'S JURISDICTION TO DISCIPLINE A LICENSED CPA UNDER FORMER RCW 18.04.295(2)

¶ 14 Greenen contends that the Board lacked jurisdiction to discipline her for misrepresenting her former spouse's eligibility for medical insurance while she was a licensed CPA and working as an account manager at the Port. Greenen interprets former RCW 18.04.295(2)'s phrase "representing oneself as a CPA" to require that the Board's charge involve misconduct solely in the practice of public accounting.⁵ The Board responds that it properly exercised its authority to discipline Greenen given the specific facts here and former RCW 18.04.295(2)'s plain language and legislative history.

A. Former RCW 18.04.295(2) and Former WAC 4-25-910(2)(a)(ii)-(iii)

¶ 15 Because Greenen's argument focuses on statutory interpretation, we first evaluate former RCW 18.04.295(2)'s plain language and statutory scheme. Campbell, 150 Wash.2d at 894, 83 P.3d 999; Pub. Util. Dist. No. 1 of Pend Oreille County, 146 Wash.2d at 791, 51 P.3d 744. And former WAC 4-25-910(2)(a)(ii)-(iii) must be reasonably consistent with the Act and former RCW 18.04.295(2). Campbell, 150 Wash.2d at 892, 83 P.3d 999.

¶ 16 The Act's statutory scheme provides the Board jurisdiction on numerous issues related to holders of a CPA license or certificate. One purpose of the Act is to "protect the public interest" by "assess [ing] the qualifications" of both CPAs and "certificate holders who are not licensed for the practice of public accounting." Former RCW 18.04.015(1)(b)(ii) (1992) (emphasis added). The Act provides the Board with broad authority to promulgate rules in the WAC to assist the Board in performing its responsibilities. Former RCW 18.04.055(11) (1992); see also former RCW 18.04.055(4). The Board has jurisdiction to establish the requirements for CPA licensure and certification; the power to issue, revoke, and reinstate a CPA license or certificate; and the power to revoke, suspend, or refuse to renew a CPA certificate or license and...