Peterson v. State

• Docket Number: 84709-1-I
• Decision Date: 28 August 2023
• Parties: AUDREY MAE PETERSON, Petitioner, v. STATE OF WASHINGTON, DEPARTMENT OF SOCIAL AND HEALTH SERVICES, ADULT PROTECTIVE SERVICES, Respondent.
• Court: Washington Court of Appeals

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AUDREY MAE PETERSON, Petitioner,
v.
STATE OF WASHINGTON, DEPARTMENT OF SOCIAL AND HEALTH SERVICES, ADULT PROTECTIVE SERVICES, Respondent.

No. 84709-1-I

Court of Appeals of Washington, Division 1

August 28, 2023

Hazelrigg, A.C.J.

Audrey Peterson appeals from a review decision and final order that determined she financially exploited a vulnerable adult. Because the review judge failed to give due regard to the administrative law judge's ability to observe the witnesses, an error of law, we reverse.

FACTS

Audrey Peterson has been a registered nurse since 2009 and has worked in hospice care since 2013. In October 2019, Peterson was employed by Catholic Health Initiatives Franciscan Palliative and Hospice (CHI) and was responsible for assessing patients to determine hospice care eligibility. On October 5, she evaluated a patient named Reagan^[1] in Reagan's home. Reagan, her husband Dean, and her daughter Krystel Hathaway were present for the assessment. As part of the intake process, Peterson asked to see all of

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Reagan's medications to document them and ensure there was at least a five-day supply of each medication in the home since another nurse would not return for a follow-up visit for five days. Hathaway asserted that while documenting medications, Peterson opened a bottle of Reagan's prescription pain medication, poured some of the pills into her hand, and put them into her laptop bag. Hathaway called CHI and reported the incident; CHI contacted Adult Protective Services (APS), a program of the Department of Social and Health Services (DSHS). APS made an initial finding that Peterson financially exploited a vulnerable adult. Peterson exercised her right to challenge the finding by timely requesting an administrative hearing.

The hearing largely consisted of a credibility battle between Peterson and Hathaway. Both testified and participated in a visual demonstration of how the parties were positioned during the purported incident in order for the Administrative Law Judge (ALJ) David Dunlap to determine the vantage points of those present. Peterson also reenacted her method of handling pill bottles to conduct a count. Erin Bush, an investigator for the Nursing Care Quality Assurance Commission (NCQAC), testified regarding her investigation of the incident. Grace Brower, an APS investigator, testified about her own investigation. In Peterson's case in chief, she called Thomas Browning and Katherine Thomas, who each detailed their positive experiences working with Peterson. ALJ Dunlap admitted and considered several exhibits during the hearing, including Brower's investigation notes and outcome report, Reagan's admission profile, notes from CHI supervisor Deborah Hagopian regarding

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Hathaway's report, Bush's memo from her phone interview of Hathaway, the incident report from the Lakewood Police Department, a copy of Reagan's prescription for oxycodone,^[2] the NCQAC notification that there was not substantial evidence of a violation to support any disciplinary action with regard to Peterson's nursing license, and Peterson's medical records.

After the conclusion of the hearing, ALJ Dunlap issued an initial order that found Peterson did not financially exploit Reagan and reversed the initial finding by APS. DSHS petitioned for review with the Board of Appeals. The review judge, Thomas Sturges, reversed Dunlap's initial order and affirmed the substantiated finding by APS. Peterson timely petitioned for judicial review in Thurston County Superior Court. The petition was transferred to the Court of Appeals Division Two, then to this division.

ANALYSIS

An individual may seek judicial review of an administrative decision under the Administrative Procedure Act. Ch. 34.05 RCW. The party challenging the agency action bears the burden to demonstrate the invalidity of the agency action. RCW 34.05.570(1)(a). This court will grant relief from an agency adjudicative order only if one or more of the bases set out in RCW 34.05.570(3) apply. Here, Peterson contends that the statute or rule on which the order is based violates the constitution, the agency erroneously interpreted or applied the law, the order is not supported by substantial evidence, and the order is arbitrary and capricious.

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In an appeal from a substantiated finding of abuse of a vulnerable adult, an ALJ issues an initial order, subject to review by a reviewing officer. Crosswhite v. Dep't of Soc. & Health Servs., 197 Wn.App. 539, 547, 389 P.3d 731 (2017). The reviewing judge generally "shall exercise all the decision-making power that the reviewing officer would have had to decide and enter the final order had the reviewing officer presided over the hearing." RCW 34.05.464(4). This court "review[s] the review judge's final order, not the initial order entered by the ALJ." Crosswhite, 197 Wn.App. at 548.

I. Due Regard to ALJ's Ability To Observe Witnesses

Peterson first asserts Review Judge Sturges erred as a matter of law because he failed to give due regard to ALJ Dunlap's opportunity to observe the witnesses. Both RCW 34.05.464(4) and WAC 388-02-0600(1) require a reviewing judge to "give due regard" to the ALJ's ability to observe witnesses. RCW 34.05.464(4) states, "In reviewing findings of fact by presiding officers, the reviewing officers shall give due regard to the presiding officer's opportunity to observe the witnesses." WAC 388-02-0600(1) requires that "[i]n reviewing findings of fact, the review judge must give due regard to the ALJ's opportunity to observe witnesses." The failure to give due regard to the ALJ's findings informed by their ability to observe witnesses is an error of law. Quilang v. Dep't of Soc. & Health Servs., 25 Wn.App. 2d 164, 174, 527 P.3d 73 (2022).

This court interprets statutes and regulations de novo. Yaron v. Conley, 17 Wn.App. 2d 815, 825, 488 P.3d 855 (2021). We apply the general rules of statutory construction when interpreting regulations. Id. In interpreting a statute,

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we first look to the plain language of the statute and give meaning to each word. Smith v. Dep't of Lab. & Indus., 22 Wn.App. 2d 500, 506, 512 P.3d 566 (2022). We construe statutes so that "'no clause, sentence or word shall be superfluous, void, or insignificant.'" HomeStreet, Inc. v. Dep't of Rev., 166 Wn.2d 444, 452, 210 P.3d 297 (2009) (internal quotation marks omitted) (quoting Kasper v. City of Edmonds, 69 Wn.2d 799, 804, 420 P.2d 346 (1966)). We "'assume the Legislature meant exactly what it said and apply the statute as written.'" Id. (quoting Duke v. Boyd, 133 Wn.2d 80, 87, 942 P.2d 351 (1997)). Where a term is not defined by statute or regulation, we may look to a dictionary definition. Samish Indian Nation v. Dep't of Licensing, 14 Wn.App. 2d 437, 442, 471 P.3d 261 (2020).

RCW 34.05.464(4) has not been amended since it was codified in 1988. WAC 388-02-0600, in contrast, has been amended three times. As originally promulgated, the regulation provided for a much narrower inspection by the reviewing officer. It stated that review judges had the same decision-making authority as the ALJ only in specific types of cases, which did not include APS findings. Former WAC 388-02-0600(1) (2000). In these cases, the review judge was required to "consider the ALJ's opportunity to observe the witnesses." Id. In all other cases, the review judge only had authority to change the ALJ's initial order if there were irregularities such as an abuse of discretion or misconduct, if the findings of fact were not supported by substantial evidence, if the ALJ erred as a matter of law, if the order needed to be clarified, or if the ALJ failed to make an essential finding of fact. Former WAC 388-02-0600(3) (2000). Despite

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several changes to the rule refining the scope of review, the core requirement to "consider the ALJ's opportunity to observe the witnesses" remained unchanged.^[3]The current rule was overhauled in 2011, reiterating that reviewing judges had "the same decision-making authority as the ALJ," but providing for de novo review of initial orders in all cases, rather than just in specific types of cases. Wash. St. Reg. 11-04-074 (Mar. 3, 2011). However, the review judge's discretion was limited by the requirement that "the review judge must give due regard to the ALJ's opportunity to observe witnesses." WAC 388-02-0600(1). This reflects an election by DSHS to broaden the authority of a reviewing judge but place a caveat on that authority. It further reflects an explicit choice by DSHS that the review judge not merely "consider" the ALJ's opportunity to observe the witness testimony, but give it "due regard." "'When the legislature uses different words in the same statute, we presume the legislature intends those words to have different meanings.'" Ass'n of Wash. Spirits & Wine Distribs. v. Wash. State Liquor Control Bd., 182 Wn.2d 342, 353, 340 P.3d 849 (2015) (quoting In re Pers. Restraint of Dalluge, 162 Wn.2d 814, 820, 177 P.3d 675 (2008) (Sanders, J., dissenting)).

Based on our rules of statutory interpretation, we must presume that DSHS, in amending WAC 388-02-0600(1), meant something different when it

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altered the requirement that the review judge "give due regard" to the ALJ's opportunity to observe witnesses rather than simply "consider" it. Consider is not defined by regulation. The dictionary definition of "consider" includes "to reflect on: think about with a degree of care or caution . . . to think of, regard, or treat in an attentive, solicitous, or kindly way . . . reflect, deliberate, ponder." Webster's Third New International Dictionary 483 (2002). As such, DSHS must have intended for "due regard" to mean something different from this definition. We must additionally assume that DSHS and the legislature meant what they said in requiring that a review judge "give due regard to the ALJ's opportunity to observe witnesses." We give meaning to each of the words in the regulation...