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Desta v. Maine Unemployment Insurance Commission

Superior Court of Maine, Cumberland

November 19, 2014

ABERA DESTA, Plaintiff


Thomas D. Warren, Justice.

Before the court is Abera Desta's appeal from a March 7, 2014 decision of the Maine Unemployment Insurance Commission (R. 1-7) denying him unemployment benefits and ordering him to repay an overpayment of $ 5, 453.00.

Standard of Review

On this appeal the court's role is to determine whether the Commission correctly applied the law and whether its findings are supported by any competent evidence. McPherson Timberlands Inc. v. Unemployment Insurance Commission, 1998 ME 177 ¶ 6, 714 A.2d 818. The court cannot overrule a decision of the Commission unless the record before the Commission compels a contrary result. Id. The court should not substitute is own judgment for that of the agency and must affirm findings of fact if they are supported by substantial evidence in the record. Rangeley Crossroads Coalition v. Land Use Regulation Commission, 2008 ME 115 ¶ 10, 955 A.2d 223.

Findings by Hearing Officer vs. Findings by Commission

At the outset this case presents the question of whether the Commission was entitled to disregard the findings made by a Hearing Officer after an evidentiary hearing where the Hearing Officer had the opportunity to listen to the witnesses and observe their demeanor.

The original decision by the Deputy denied benefits on the ground that Desta had left his employment voluntarily without good cause attributable to his employer. (R. 289). After a lengthy evidentiary hearing (R. 92-281), an agency hearing officer issued a decision overturning the deputy's original ruling that Desta had left his employment voluntarily and also rejecting the employer's argument that Desta was not entitled to benefits because he had been discharged for misconduct. (R. 60-66).

On the employer's appeal to the Commission, the Commission did not hold another evidentiary hearing but set a hearing "limited to Oral Argument Only." (R. 35) (emphasis in original). After hearing oral argument (R. 8-34), two members of the Commission issued a decision that, contrary to the finding of the hearing examiner, concluded that Desta had been validly discharged for misconduct within the meaning of 26 M.R.S. § 1043(23) and was therefore disqualified from receiving benefits pursuant to 26 M.R.S. § 1193(2). (R. 1-7).[1] One member of the Commission dissented. (R. 7).

Desta argues that the Commission, acting on what he characterizes as a cold record, is not entitled to overturn findings by the Hearing Officer that were based on the Hearing Officer's first-hand evaluation of the credibility of witnesses. Counsel for the Commission disagrees, arguing that the Commission is entitled to make the final decision based on the administrative record.

In this case some of the Commission's factual findings contradict those of the hearing officer. Whether the Commission is entitled to substitute its judgment on factual issues poses a difficult question and one on which many of the cases cited by the parties are not particularly helpful. Thus, while counsel for Desta relies on Poole v. Statler Tissue Corp., 400 A.2d 1067 (Me. 1979), and Matthews v. R. T. Allen & Sons Inc., 266 A.2d 240 (Me. 1970), the Law Court cast significant doubt upon the analysis in those cases in Dunton v. Eastern Fine Paper Co., 423 A.2d 512, 514-15, 517 (Me. 1980). Similarly, the proposition that a court should defer to findings made by an administrative agency even when those are based solely on a written record, see Costa v. Mr. "G" Foodliner, 431 A.2d 1292, 1294-95 (Me. 1981); Dunton, 423 A.2d at 514-15, does not address the issue of whether the Commission can make findings inconsistent with those reached by a hearing officer after an evidentiary hearing. Moreover, the Law Court's ruling in New England Telephone & Telegraph Co. v. PUC, 448 A.2d 272, 279 (Me. 1982), that Commissioners are entitled to rely on and essentially adopt findings by agency hearing examiners does not address whether Commissioners are instead entitled to contradict findings of their hearing officers without holding a new evidentiary hearing.

However, the Law Court's decision in Green v. Commissioner of Mental Health, Mental Retardation, and Substance Abuse Services, 2001 ME 86, 776 A.2d 612, supports the Commission on this issue. Green also involved a case where the final decision of the agency contradicted that of the agency hearing officer. The Law Court emphasized that it was the Commissioner's findings, not those of the hearing officer, that were subject to review for clear error. 2001 ME 86 ¶ 12. The court disagreed that only the hearing officer who had heard the evidence and assessed the credibility of witnesses could make factual findings. 2001 ME 86 ¶ 14. It added that

[a]s long as the decision-making officer both familiarizes himself with the evidence sufficient to assure himself that all statutory criteria have been satisfied and retains the ultimate authority to make the decision, he can properly utilize subordinate officers to gather evidence and make preliminary reports (citation omitted).... No authority, however, binds the agency decision-maker to the findings contained in the hearing officer's report.

2001 ME 86 ¶ 15.

To the extent that the Green decision does not resolve the issue, the record in this case also reflects that at least one of the Commissioners listened to the entire recording of the hearing before the hearing officer and the other two Commissioners also had the opportunity to review that hearing. (R. 11). Under those circumstances the court concludes that the Commission was entitled to make ...

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