Sussel v. Civil Service Com'n of City and County of Honolulu

• Decision Date: 06 May 1993
• Docket Number: No. 16424,16424
• Citation: 851 P.2d 311,74 Haw. 599
• Parties: Malcolm A. SUSSEL, Appellant-Appellee, v. CIVIL SERVICE COMMISSION OF the CITY AND COUNTY OF HONOLULU; Hiroo W. Miyagi; Ernest K. Tacazon; Patricia K. Salsbury; and Isabel M. Tagala, individually, and in their capacities as Commission Members of the Civil Service Commission of the City and County of Honolulu, Appellees, and Frank F. Fasi, Mayor, Appellee-Appellant, and D.G. Anderson, Managing Director; George Kekuna, Managing Director's Office; and Loretta K. Fukuda, Director of Civil Service, Additional Appellees.
• Court: Hawaii Supreme Court

Page 311

851 P.2d 311

74 Haw. 599

Malcolm A. SUSSEL, Appellant-Appellee, v. CIVIL SERVICE COMMISSION OF the CITY AND COUNTY OF HONOLULU Hiroo W. Miyagi; Ernest K. Tacazon; Patricia K. Salsbury and Isabel M. Tagala, individually, and in their capacities as Commission Members of the Civil Service Commission of the City and County of Honolulu, Appellees and Frank F. Fasi, Mayor, Appellee-Appellant and D.G. Anderson, Managing Director; George Kekuna, Managing Director's Office; and Loretta K. Fukuda, Director of Civil Service, Additional Appellees.

No. 16424.

Supreme Court of Hawai'i.

May 6, 1993.

Reconsideration Denied May 26, 1993.

Syllabus by the Court

1. Review of a decision made by the circuit court upon its review of an agency's decision is a secondary appeal. The standard of review is one in which this court must determine whether the circuit court was right or wrong in its decision, applying the standards set forth in Hawaii Revised Statutes (HRS) § 91-14(g) to the agency's decision. This court's review is further qualified by the principle that the agency's decision carries a presumption of validity and appellant has the heavy burden of making a convincing showing that the decision is invalid because it is unjust and unreasonable in its consequences.

2. Under HRS § 91-14(g), conclusions of law are reviewable under subsections (1), (2), and (4); questions regarding procedural defects under subsection (3); findings of fact under subsection (5); and an agency's exercise of its discretion under subsection (6).

3. A reviewing court will reverse an agency's finding of fact if it concludes that such agency finding is clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record.

4. An agency's conclusions of law are freely reviewable.

5. The basic tenet of res judicata is that the judgment of a court of competent jurisdiction is a bar to a new action in any court between the same parties or their privies concerning the same subject matter.

6. Collateral estoppel is an aspect of res judicata which precludes the relitigation of a fact or issue which was previously determined in a prior suit on a different claim between the same parties or their privies.

7. The doctrine of collateral estoppel is tempered only by the prerequisite that a party have a full and fair opportunity to litigate the relevant issues in the prior lawsuit.

8. The City and County of Honolulu is not immune from paying interest on a civil judgment simply because there is no express statutory authority governing the issue. Where there is no express statutory authority governing the payment of interest on a specific type of claim, the applicable statute is HRS § 478-3.

9. Prejudgment interest is to be allowed wherever it is properly proved.

10. Prejudgment interest is awardable under HRS § 636-16 in the discretion of the trial court.

11. Interest on a judgment is essentially compensatory in nature; interest is given on money demands as damages for delay in payment, being just compensation to the plaintiff for a default on the part of his debtor.

Steven M. Nakashima (Ann-Marie McKittrick and Natalie S. Hiu of Goodsill, Anderson, Quinn & Stifel, and William C. McCorriston of McCorriston, Miho & Miller, with him on the briefs), Honolulu, for appellee-appellant Frank F. Fasi.

Dennis W. King (William J. Deeley, with him on the briefs), Honolulu, for appellant-appellee Malcolm A. Sussel.

Paul Devens and Caron M. Inagaki of Devens, Lo, Youth, Nakano & Saito, on the briefs, Honolulu, for City and County of Honolulu.

Before MOON, C.J., LEVINSON and NAKAYAMA, JJ., BURNS, Intermediate Court of Appeals Chief Judge, in place of KLEIN, J., recused, and SPENCER, Circuit Judge, assigned by reason of vacancy.

MOON, Chief Justice.

In 1985, appellant-appellee Malcolm A. Sussel (Sussel), former administrator of the Oahu Civil Defense Agency (OCDA) ¹ of the City and County of Honolulu (City), appealed what he claimed was his illegal demotion to the State Civil Service Commission (Commission). In 1991, the Commission ruled that Sussel had not been demoted, and Sussel subsequently appealed that decision to the First Circuit Court.

In 1992, the circuit court held that the Commission had clearly erred, and that Sussel had, in fact, been demoted illegally. The court ordered that Sussel be reinstated with full retroactive restoration of lost pay and other benefits. Appellee-appellant Mayor Frank F. Fasi (Fasi) now appeals from the order of the circuit court. Both Sussel and the City have cross-appealed. We affirm the reinstatement of Sussel and the order granting Sussel ten percent interest on his back pay.

I. BACKGROUND

The appeal and cross-appeals in this case are the latest incidents in a long-running dispute between Fasi and Sussel. Sussel was appointed to the position of administrator in June of 1982 by then-Honolulu mayor Eileen Anderson, who had defeated the incumbent Fasi in the 1980 election. Sussel, who had been serving as assistant administrator of the OCDA, had submitted an application for the job, and had been reviewed pursuant to relevant civil service procedures.

In the November 1984 mayoral race, Fasi defeated Eileen Anderson and assumed office on January 2, 1985. In December 1984, Fasi announced that George Kekuna (Kekuna) would be taking over the administration of the OCDA. Fasi had originally intended that Kekuna be appointed to the position of State Deputy Director of Civil Defense for Honolulu county, a post traditionally held by the Mayor himself. However, after the State Director of Civil Defense requested that Fasi maintain tradition by assuming the role of State Deputy Director, Fasi decided to appoint Kekuna to the newly created post of "Deputy Director Designate." Although Sussel would nominally retain his position as OCDA administrator, Fasi intended that Kekuna would take over the administration of the OCDA from Sussel.

On January 2, 1985, then-City Managing Director, Andy Anderson (Anderson), met with Sussel to inform him that he would remain the OCDA administrator, but that he would be subject to the authority of Kekuna, who would actually be overseeing the agency. On January 7, Kekuna was formally introduced to the OCDA staff; all OCDA employees were informed that they were to look to Kekuna for direction and guidance concerning OCDA affairs.

On January 9, pursuant to a request by Sussel, a meeting was held in Anderson's office regarding Sussel's situation. In attendance were Sussel and his attorney, Anderson, the corporation counsel, the civil service director, and a representative from the Hawaii Government Employees Association. The city officials who attended the meeting claim that Sussel was primarily concerned that he would still have the liabilities without the actual administrative authority of his office. These same officials maintain that they subsequently arranged for the "downward reallocation" of Sussel's position in order to allay Sussel's concerns about his continuing liability. Sussel's position as OCDA administrator was thereafter changed from Executive Assistant I to Administrative Assistant II. Although Sussel continued to draw the same salary, the change resulted in a reduction of some nine pay grades, and he was no longer eligible to receive any of the pay raises subsequently given to the rank of Executive Assistant I.

On or about January 11, Sussel was required to vacate his office, turn in his keys to the front door of the Civil Defense Office and the executive restroom as well as turn in his pager. He was also told to work only regular hours and informed that he was not to respond to emergencies; nor was he to act as the OCDA's spokesperson with the media. Kekuna assumed essentially all of Sussel's prior administrative duties as head of the OCDA.

On January 25, 1985, Sussel timely appealed to the Commission, asserting that he was a civil service employee and that under the applicable civil service rules, he had been illegally demoted because he had not received the requisite ten-day written notice of his demotion. ² On January 7, 1986, the Commission held that Sussel was not protected by the civil service rules. Sussel then appealed to the First Circuit Court. On May 22, 1987, the circuit court reversed the Commission's ruling and held that the administrator of the OCDA was a civil service position subject to the civil service rules. The court remanded the case to the Commission for further proceedings.

Following Sussel's appeal of the Commission's ruling to the circuit court, but prior to that court's May 22 decision, Sussel filed suit in the United States District Court for the District of Hawaii, seeking damages under 42 U.S.C. § 1983 and pendent state claims for alleged violations of his federal due process rights (federal action). On December 16, 1987, the federal court entered an order staying Sussel's federal action pending final resolution of the commission proceedings and any resultant state court review.

On April 29, 1988, Sussel filed an action in the First Circuit Court (state action), which was virtually identical to the federal action. The state action defendants, comprised of the Mayor and various other city officials, removed the case to the federal district court. Prior to the institution of the state action, the federal court had vacated its stay of Sussel's initial federal claim. After the removal of Sussel's state claim to the federal court, the two actions were consolidated for trial.

On March 3, 1989, Judge Ezra of the federal district court dismissed or granted summary judgment against Sussel on all of his federal claims, his contract claims, and his claim for defamation, and remanded his remaining state law claims to the state circuit court. As part of its decision, however, the federal court specifically found that, contrary to the defendants' contention that he had merely been "downwardly reallocated," Suss...