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      "EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellant/Respondent v. WILLIAM PEACE, Appellee/Petitioner EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellee-Respondent, v. WILLIAM H. PEACE, III, Appellant-Petitioner."
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      {
        "text": "SMITH, Judge.\nPetitioner, William H. Peace, III, appeals a superior court order reversing a State Personnel Commission decision which reinstated petitioner as an employee of respondent, the Employment Security Commission of North Carolina (\u201cESC\u201d). ESC appeals a superior court order affirming an Office of Administrative Hearing (\u201cOAH\u201d) decision finding a Title VII violation and reinstating petitioner. After carefully reviewing the record, we agree with petitioner\u2019s contention that ESC has failed to show that it dismissed petitioner with just cause. Therefore, we affirm the decision of the State Personnel Commission reinstating petitioner. For reasons stated herein, we do not address the merits of ESC\u2019s appeal.\nWilliam H. Peace, III, began his employment with respondent on 15 October 1985 as its Equal Employment Opportunity (\u201cEEO\u201d) officer. On 10 April 1991, an incident between Peace and a coworker occurred which ultimately led to Peace\u2019s dismissal for alleged unacceptable personal conduct. The State Personnel Commission adopted, inter alia, the following facts as recommended by the Administrative Law Judge (\u201cALT\u2019): During his 1985 orientation, petitioner was informed that by paying $2.00 per month to the Personnel Office petty fund, he would be entitled to obtain an occasional cup of coffee from a pot located in the personnel file room. He paid the dues; however, his usual practice was to go to the agency\u2019s cafeteria for morning coffee. Prior to 10 April 1991, no one informed petitioner that his payment into the petty fund did not entitle him to obtain coffee from the personnel file room. Over the years, on an irregular basis, he obtained coffee from the petty fund coffee pot. At a staff meeting which petitioner did not attend, a coffee fund was established, for which membership dues were $3.40 per month. Petitioner was not made aware of a separate coffee fund, nor was he asked to join.\nOn 10 April 1991, petitioner got a cup of coffee from the personnel file room. As petitioner was leaving the office with the coffee an exchange between him and Ms. Catherine High, a supervisor in the personnel office, took place in which she told him that he should pay her for the coffee. Petitioner refused. Ms. High called petitioner \u201cdespicable\u201d and told him she hoped he was fired. She ended the colloquy by telling petitioner that, if he got another cup of coffee and did not pay her, she would get a cup of coffee and scald him with it. Ms. High informed her supervisor and Mr. Gene Baker, who became petitioner\u2019s immediate supervisor as of 22 April 1991, of the incident.\nOn the afternoon of 10 April 1991, petitioner contacted the magistrate\u2019s office regarding the incident with Ms. High. He was informed that if he believed she was capable of carrying out her threat, he should take out a warrant against her. Petitioner spoke with Ms. High following his conversation with the magistrate\u2019s office, at which time he gave her an opportunity to apologize. Ms. High did not apologize. Thereafter, petitioner had the magistrate\u2019s office issue summons against Ms. High charging her with communicating a threat. The charge was dismissed by the trial court as frivolous and petitioner was ordered to pay court costs.\nPetitioner was not contacted by his superiors regarding the incident until he received a predismissal conference memorandum on 5 June 1991, from Gene Baker, his immediate supervisor. Following a 6 June dismissal conference, petitioner was discharged for unacceptable personal conduct. In a 7 June letter, Ann Q. Duncan, Chairperson of the Employment Security Commission explained that petitioner was being dismissed for unacceptable conduct, including taking the coffee without paying Catherine High and filing criminal charges against High, which were found to be frivolous. Such conduct, said Duncan, caused petitioner\u2019s reputation as the EEO officer at ESC to be called into question and his respect among fellow employees diminished.\nPetitioner filed two appeals to the ESC decision to discharge him. The basis of his appeals were that ESC lacked \u201cjust cause\u201d to dismiss him pursuant to N.C. Gen. Stat. \u00a7 126-35 (1995), and that he had been discharged in retaliation for having filed discrimination charges against ESC in 1989, in violation of Title VII, Section 704(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-3 (1964). Petitioner did not appeal upon a state claim of retaliatory discharge pursuant to N.C. Gen. Stat. \u00a7 126-36. Pursuant to N.C. Gen. Stat. \u00a7 7A-759, petitioner\u2019s charge of retaliatory discharge was investigated by the Civil Rights Division of the Office of Administrative Hearings.\nThrough its investigation, OAH found reasonable cause to believe that a violation of Title VII had occurred. OAH presented petitioner with three options. He could: (1) receive a right to sue letter; (2) commence a contested case hearing in OAH; or (3) do nothing. Petitioner chose to commence a contested case hearing with regard to the retaliatory discharge claim. He also filed a petition for contested case hearing with regard to the N.C. Gen. Stat. \u00a7 126-35 lack of \u201cjust cause\u201d claim. Pursuant to an order of the Chief Administrative Law Judge of OAH, both cases were consolidated for hearing. A hearing was conducted by AU Sammie Chess on 12-14 July 1993.\nPursuant to N.C. Gen. Stat. \u00a7 7A-759(e), an AU decision on the merits of a retaliatory discharge claim is a final decision binding on the parties. However, with regard to the N.C. Gen. Stat. \u00a7 126-35 lack of \u201cjust cause\u201d claim, an AU issues a recommended decision to the State Personnel Commission, which then issues a final decision. N.C. Gen. Stat. \u00a7 126-37 (1995). ALJ Chess issued two separate decisions following the hearing. In his recommended decision to the State Personnel Commission, AU Chess found that ESC had the burden of proving it had \u201cjust cause\u201d to discharge petitioner. ALJ Chess concluded that ESC had failed to meet that burden and recommended petitioner be reinstated. In his final decision regarding the retaliatory discharge claim pursuant to Title VII, AU Chess concluded that petitioner\u2019s discharge violated Section 704(a) of Title VII of the Civil Rights Act of 1964, in that his dismissal was retaliatory. Pursuant to that holding, AU Chess ordered petitioner reinstated.\nThe AU\u2019s recommended decision reinstating petitioner for lack of \u201cjust cause\u201d was adopted, with slight modification, by the State Personnel Commission. ESC appealed the State Personnel Commission order and the AU final decision separately, pursuant to N.C. Gen. Stat. \u00a7 150B-50 (1995). In a 13 August 1994 order, Judge Narley L. Cashwell upheld the final decision of the AU with regard to the retaliatory discharge claim in which petitioner was ordered reinstated. In a 13 March 1995 order, Judge Wiley F. Bowen reversed the final decision of the State Personnel Commission and dismissed Peace\u2019s petition challenging his dismissal. From these superior court orders, ESC appeals Judge Cashwell\u2019s order affirming the retaliatory discharge claim. Petitioner appeals Judge Bowen\u2019s order reversing the State Personnel Commission decision to reinstate him.\nInitially, we note that the two cases should have been consolidated for all purposes except the final agency decision by the AU pursuant to N.C. Gen. Stat. \u00a7 150B-26. Failing that, the appeals from the AU and State Personnel Commission orders should have been consolidated in ESC\u2019s petition for judicial review to the superior court. At the very least, the two appeals should have been consolidated for hearing in the superior court, as both appeals involved identical facts and similar questions of law. As a result of the failure to consolidate and the filing of two separate petitions for judicial review, two inconsistent orders were issued from Wake County Superior Court. In addition, we are now presented with two records on appeal and two sets of lengthy briefs, all arising out of the same set of facts.\nAfter careful review of both records and both sets of briefs in this case, we agree with petitioner that the superior court erred in reversing the State Personnel Commission decision to reinstate petitioner. For this reason, it is unnecessary for us to reach the merits of ESC\u2019s appeal of the superior court order affirming the AU order to reinstate petitioner under the retaliatory discharge claim, as that issue is rendered moot by our decision reinstating the decision of the State Personnel Commission.\nThis Court\u2019s as well as the superior court\u2019s review of a final agency decision is governed by N.C. Gen. Stat. \u00a7 150B-51 (1995). In Re: Appeal of Ramseur, 120 N.C. App. 521, 463 S.E.2d 254 (1995); Dockery v. Dept. of Human Resources, 120 N.C. App. 827, 463 S.E.2d 580 (1995). The proper standard of review depends upon the particular issues presented on appeal. Brooks v. Ansco & Associates, 114 N.C. App. 711, 716, 443 S.E.2d 89, 92 (1994). \u201cIf it is alleged that the agency\u2019s decision was based on an error of law, then de novo review is required. If, however, it is alleged that the agency\u2019s decision was not supported by the evidence or that the decision was arbitrary or capricious, then the reviewing court must apply the \u2018whole record\u2019 test.\u201d In re: Appeal of Ramseur, 120 N.C. App. at 524, 463 S.E.2d at 256 (citations omitted).\nTo determine whether an agency\u2019s findings are supported by substantial evidence, the reviewing court applies the \u201cwhole record\u201d test. Leiphart v. N.C. School of the Arts, 80 N.C. App. 339, 342 S.E.2d 914, cert. denied, 318 N.C. 507, 349 S.E.2d 862 (1986). \u201cSubstantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.\u201d Comr. of Insurance v. Rating Bureau, 292 N.C. 70, 80, 231 S.E.2d 882, 888 (1977) (citation omitted). The \u201cwhole record\u201d test requires the reviewing court to take into account all evidence in the record, including evidence which supports the Commission\u2019s decision as well as that which in fairness detracts from it. Id. However, \u201c[t]he \u2018whole record\u2019 test does not allow the reviewing court to replace the [agency\u2019s] judgment as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before it de novo . . . .\u201d Thompson v. Board of Education, 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977) (citation omitted).\nAs the reviewing court, we must take into account the specialized expertise of the staff of an administrative agency, in this case, the State Personnel Commission. High Rock Lake Assoc. v. Environmental Management Comm., 51 N.C. App. 275, 279, 276 S.E.2d 472, 475 (1981). While there is evidence in the record contrary to the Commission\u2019s findings, neither this Court nor the superior court may substitute its judgment for that of the agency. After reviewing the record, we find substantial evidence to support the State Personnel Commission\u2019s findings of fact.\nWhile the criminal charges brought by petitioner against Ms. High were found to be frivolous, the Commission found as fact that \u201c[t]he petitioner believed that Ms. High was capable of scalding him with coffee.\u201d In passing upon issues of fact, the Commission, as trier of fact, is the sole judge of the credibility of the witnesses, and of the weight to be given to their testimony. This being true, it may accept or reject the testimony of a witness, in whole or in part, depending solely upon whether it believes or disbelieves the witness. Anderson v. Motor Co., 233 N.C. 372, 376, 64 S.E.2d 265, 268 (1951). The Commission found it pertinent that the judicial officer (magistrate) \u201cfound facts sufficient to issue the warrant.\u201d The Commission also found that none of the reasons for petitioner\u2019s dismissal were ever discussed with him prior to 6 June 1991. Applying the \u201cwhole record\u201d test, we find the Commission\u2019s findings are supported by substantial evidence.\nBased upon its findings of fact, the State Personnel Commission made the following conclusions of law:\n1. Petitioner was a Permanent State employee within the meaning of that term as defined in North Carolina General Statute Section 126-39, at the time of his dismissal on June 7, 1991. The Office of Administrative Hearings has jurisdiction to hear Petitioner\u2019s appeal where he has alleged that Respondent lacked just cause to terminate his employment without warning and where he has alleged that Respondent committed procedural violations while implementing the dismissal. [N.C. Gen. Stat. \u00a7] 126-35.\n2. [N.C. Gen. Stat. \u00a7]126-35(a) provides, in part, that \u201c[N]o permanent employee subject to the State Personnel Act shall be discharged . . . for disciplinary reasons, except for just cause.\u201d Where just cause is an issue, the Respondent bears the ultimate burden of persuasion. A just cause issue involves both procedural and substantive questions. Causes for dismissal fall into two categories: (1) causes relating to performance of job duties and, (2) causes relating to personal conduct - no prior warnings are required under (2).\n3. The Petitioner was not discharged for just cause.\n5. Respondent\u2019s actions, or lack thereof, following the April 10, 1991 coffee incident and May 21, 1991 court judgment were inconsistent with its claim that Petitioner\u2019s conduct was unacceptable. For the two month period, April 10, 1991 through June 6, 1991, Respondent never raised the issue of unacceptable personal conduct with Petitioner; in addition, during that period, Petitioner\u2019s work performance was neither reviewed nor appraised by Respondent to determine what impact, if any, the above incidents had on his reputation as the EEO Officer. No evidence showed that Petitioner was unfit to continue his employment due to the events occurring in April and May, 1991.\n8. Petitioner belonged to the petty fund and in good faith believed that, as in the past, such membership continued his entitlement to an occasional cup of coffee.\n13. Petitioner had the right to seek protection from potential bodily harm by taking his complaint to proper judicial officials.\nBased upon the foregoing conclusions of law, the Commission reversed ESC\u2019s decision to dismiss petitioner because such decision was without \u201cjust cause.\u201d\nPetitioner\u2019s argument that his discharge was not for. \u201cjust cause\u201d based upon his personal misconduct raises a question of law and is, therefore, reviewed de novo by this Court. Amanini v. N.C. Dept. of Human Resources, 114 N.C. App. 668, 678, 443 S.E.2d 114, 120 (1994). An alleged error of law \u201cexists if a conclusion of law entered by the administrative agency is not supported by the findings of fact entered by the agency or if the conclusion of law does not support the decision of the agency.\u201d Brooks, 114 N.C. App. at 717, 443 S.E.2d at 92. In this case, we hold the agency\u2019s findings, support its conclusions, and its conclusions support its decision to reinstate petitioner.\nAs a career state employee, defined in N.C. Gen. Stat. \u00a7 126-1A, petitioner could not be dismissed from employment with ESC except for \u201cjust cause.\u201d N.C. Gen. Stat. \u00a7 126-35. The \u201cjust cause\u201d provision creates a \u201cproperty interest of continued employment . . . protected by the Due Process Clause of the United States Constitution.\u201d Leiphart, 80 N.C. App. at 348, 342 S.E.2d at 921 (citations omitted). In its order, the State Personnel Commission held that the burden of proving \u201cjust cause\u201d existed to justify dismissal is upon the State. In a recent decision involving almost identical \u201cjust cause for termination\u201d provisions governing City of Raleigh employees, this Court held the City\u2019s rules placing the burden of showing lack of \u201cjust cause\u201d upon the city employee constitutionally infirm. Soles v. City of Raleigh Civil Service Comm., 119 N.C. App. 88, 457 S.E.2d 746, disc. review allowed, 341 N.C. 652, 462 S.E.2d 517 (1995). In reaching its decision, the Soles court applied a balancing test, weighing the respective interests of the individual and the governmental entity. Id. at 95, 457 S.E.2d at 751. Specifically, the Court looked at three factors:\n\u201c[F]irst, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government\u2019s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.\u201d\nId. (quoting Mathews v. Eldridge, 424 U.S. 319, 335, 47 L.Ed. 2d 18, 33 (1976)).\nExamining those factors, the Soles court held that Mr. Soles\u2019 interest in retaining his employment was a constitutionally protected property right. Regarding the second factor, the court held that \u201crequiring the dismissed employee to prove that the \u2018action taken against him was unjustified\u2019 significantly increases the risk of an erroneous deprivation of the right to retain employment,\u201d Id. at 96, 457 S.E.2d at 752. With respect to the third factor, the court recognized the City\u2019s legitimate interest in maintaining good, efficient employees for the efficient operation of government, and in that case, insuring that employees are not using illegal drugs. Nevertheless, the court concluded that the \u201cscales tip in favor of an individual employee\u2019s right to retain constitutionally protected employment until the [governmental entity] proves cause exists for termination.\u201d Id. Given the similarities between the case sub judice and Soles, we agree with the analysis, and are in fact bound by the holding; in the Soles decision. See In the Matter of Appeal from Civil Penalty, 324 N.C. 373, 379 S.E.2d 30 (1989). Therefore, we find that the Commission was correct in requiring ESC to carry the burden of proving petitioner was terminated for good cause.\nThe remaining issue left for our consideration is whether the State Personnel Commission erred in concluding as a matter of law petitioner was dismissed without \u201cjust cause.\u201d N.C. Gen. Stat. \u00a7 126-35 does not define \u201cjust cause.\u201d Interpreting the statute, we are to give the words their ordinary meaning. Reed v. Byrd, 41 N.C. App. 625, 255 S.E.2d 606 (1979). In this case, the Commission found that petitioner, in good faith, believed his membership in the office petty fund allowed him to obtain coffee from the personnel file room. The Commission also found that petitioner had the right to seek protection from potential bodily harm by taking his complaint to the proper judicial officials. There is substantial competent evidence in the record to support these findings.\nESC specifically dismissed petitioner for obtaining coffee without permission and for filing a criminal charge, later found to be frivolous. Based upon the Personnel Commission\u2019s findings, neither basis for dismissal is well founded. Thus, we cannot say that the Commission erred, as a matter of law, in its conclusion that ESC failed to show \u201cjust cause\u201d for its dismissal of petitioner.\nIn summary, we find the Commission\u2019s findings of fact supported by substantial evidence in the record. Furthermore, the Commission\u2019s conclusions of law are supported by the findings of fact and support the decision of the Commission. See Brooks, 114 N.C. App. 711, 443 S.E.2d 89. For the foregoing reasons, we affirm the order of the State Personnel Commission reinstating petitioner. ESC\u2019s appeal in case 93 CVS 10599 affirming the AU on the retaliatory discharge claim is dismissed as moot, as a result of our affirming the order of the State Personnel Commission. In case 94 CVS 11517 the order of the superior court is reversed.\nReversed in Case No. 94 CVS 11517.\nAppeal dismissed in Case No. 93 CVS 10599.\nJudges GREENE and LEWIS concur.",
        "type": "majority",
        "author": "SMITH, Judge."
      }
    ],
    "attorneys": [
      "Attorney General Michael F. Easley, by Chief Deputy Attorney General Andrew A. Vanore, Jr., and Assistant Attorney General Valerie Bateman, for North Carolina Department of Justice; and Chief Counsel T.S. Whitaker and Attorney Fred R. Gamin, for North Carolina Employment Commission, respondent appellant-appellee.",
      "Hilliard & Jones, by Thomas Hilliard, III, for petitioner appellant-appellee."
    ],
    "corrections": "",
    "head_matter": "EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellant/Respondent v. WILLIAM PEACE, Appellee/Petitioner EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellee-Respondent, v. WILLIAM H. PEACE, III, Appellant-Petitioner.\nNo. COA94-1283\nNo. COA95-678\n(Filed 7 May 1996)\n1. Public Officers and Employees \u00a7 67 (NCI4th)\u2014 state employee\u2019s obtaining coffee without permission\u2014 employee\u2019s filing of criminal charge \u2014 dismissal without just cause \u2014 sufficiency of evidence to support findings\nThe evidence was sufficient to support the findings of the Personnel Commission, and its findings were sufficient to support its conclusions that petitioner, a permanent state employee, was not dismissed for just cause and should be reinstated where the evidence tended to show that petitioner, in good faith, believed his membership in the office petty fund allowed him to obtain coffee from the personnel file room, which he did; when a supervisor in the personnel office told petitioner he should pay for the coffee, petitioner refused; the supervisor called petitioner despicable, told him she hoped he was fired, and told petitioner that, if he got another cup of coffee without paying, she would get a cup of coffee and scald him with it; petitioner had the right to seek protection from potential bodily harm by taking his complaint to the proper judicial officials, even if the charge was dismissed as frivolous by the trial court; and petitioner was not contacted by his superiors regarding the incident until he received a predismissal conference memorandum the day before his dismissal conference, after which he was dismissed for unacceptable personal conduct.\nAm Jur 2d, Civil Service \u00a7 63.\n2. Public Officers and Employees \u00a7 66 (NCI4th)\u2014 termination for good cause \u2014 burden of proof on employer\nThe Personnel Commission properly required the employer, the Employment Security Commission, to carry the burden of proving petitioner was terminated for good cause.\nAm Jur 2d, Civil Service \u00a7 61.\nAppeal by respondent from order entered 12 August 1994 by Judge Narley L. Cashwell in Wake County Superior Court and appeal by petitioner from order entered 13 March 1995 by Judge Wiley F. Bowen in Wake County Superior Court. Heard in the Court of Appeals 19 March 1996.\nAttorney General Michael F. Easley, by Chief Deputy Attorney General Andrew A. Vanore, Jr., and Assistant Attorney General Valerie Bateman, for North Carolina Department of Justice; and Chief Counsel T.S. Whitaker and Attorney Fred R. Gamin, for North Carolina Employment Commission, respondent appellant-appellee.\nHilliard & Jones, by Thomas Hilliard, III, for petitioner appellant-appellee."
  },
  "file_name": "0313-01",
  "first_page_order": 349,
  "last_page_order": 358
}
