2008-111, APPEAL OF DAN'S CITY AUTO BODY

The petitioner, Dan’s City Auto Body (Dan’s City), appeals

attorney general, on the brief and orally), for the State. Kelly A. Ayotte, attorney general (Anthony I. Blenkinsop, senior assistant to press. Errors may be reported by E-mail at the following address:

and orally), for the petitioner. Walker & Buchholz, P.A., of Manchester (Kevin E. Buchholz on the brief

(New Hampshire Department of Labor) APPEAL OF DAN'S CITY AUTO BODY

editorial errors in order that corrections may be made before the opinion goes No. 2008-111 Hampshire, One Charles Doe Drive, Concord, New Hampshire 03301, of any Department of Labor Readers are requested to notify the Reporter, Supreme Court of New ___________________________

THE SUPREME COURT OF NEW HAMPSHIRE

a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. Opinions are available on the Internet by 9:00

well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule 22 as but did not call any witnesses. The PAB treated her remarks as “the State’s

p. 2 The NHDOL representative then reiterated portions of the inspection report,

employees were authorized to work in the United States. thirteen violations, however, were documented in the addendum to the report. wages to repay loans or advances without written authorization on file. Only

of Genest on seven-year-old violations that had resulted in a fine back in 2000. representative, appearing on behalf of the State, focused her cross-examination testify specifically as to those instances in the inspectors’ report. The NHDOL

citizenship or work authorization after making the initial verification that his

violations of RSA 275:48 (Supp. 2007) for deductions made from employees’ requested a inspectors’ report. Dan’s City appealed the hearing officer’s decision and however, did not set forth any facts beyond the conclusory statements in the

past practices had, at times, violated New Hampshire labor laws, but did not

paychecks. He contested, however, that he was required to keep on file proof of regularly and that he did give loans to employees and deduct repayments from rate” employees worked with wages paid. Fourth, the inspectors cited fourteen Genest testified that employees had difficulty filling out their time cards cards without employee signature, and for difficulty reconciling the time “flat employees performing towing on evenings and weekends, for alterations of time imposed a $20,000 civil penalty for 994 violations. The hearing officer’s report,

and its efforts to comply with all applicable regulations. Genest admitted that

particularly in relation to separate pay systems for different types of tasks.

(1999) for failure to keep a true and accurate record of hours worked by testimony and inspection report, he found that the violations did occur and

another employee. They testified about the business practices of Dan’s City At the de novo hearing, Dan’s City introduced testimony from Genest and

de novo hearing before the PAB.

running a business, it was often hard to comply with all of the laws, Dan’s City offered testimony claiming that, because of the many aspects of pay. Third, the inspectors found 104 violations, one per week, of RSA 279:27 Dan’s City, disputed the violations and requested a hearing. At the hearing, 803.04 for not notifying employees in writing as to their rate, date and place of The hearing officer issued a written decision and order. Based upon the of RSA 275:49 (Supp. 2007) and New Hampshire Administrative Rules, Lab.

findings and notification of a fine totaling $100,450. Dan Genest, owner of After the inspection, the NHDOL sent Dan’s City a summary of its of hire until the inspection date. Second, the inspectors cited seven violations

number of violations appears to represent one per day per employee from time proof of citizenship or authorization to work within the United States. The for 869 violations of RSA 275-A:4-a (1999) for not keeping on file employees’ The report cited four categories of violations. First, Dan’s City was cited because the administrative findings, inferences, or conclusions are: p. 3 if the substantial rights of the appellant had been prejudiced the case for further proceedings, as determined by the court, only

court. our consideration, we do not reach their merits. fourteen violations of RSA 275:48. Dan’s City appeals that decision to this

found. report reiterated in the PAB decision are insufficient to support the violations

court shall reverse or modify the decision of the board, or remand

case. Because we agree with the State that these issues were not preserved for whole record; or violations of RSA 279:27, and a total fine of $14,000 ($1,000 each) for all considering past violations of Dan’s City in the imposition of the fine in this properly admitting evidence, including the inspectors’ report; and in

decision. Dan’s City argues that the conclusory statements in the inspectors’ 3

board as to the weight of the evidence on questions of fact. The Otherwise the court shall affirm the board’s decision. (e) Affected by other error of law.

(d) Clearly erroneous in view of the substantial evidence on the for all seven violations of RSA 275:49, a total fine of $1,000 for all 104 (c) Made upon unlawful procedures; regarding employment of illegal aliens. The PAB imposed a total fine of $5,000 NHDOL representative’s “testimony,” as opposed to closing argument; in not (b) In excess of statutory authority; summary of the hearing. On that basis, the PAB dismissed the 869 allegations (a) In violation of constitutional or statutory provisions;

State failed to present any evidence upon which the PAB could base its

The court shall not substitute its judgment for that of the

statute provides: Our review of the PAB is governed by RSA 273:11-d, IV (1999). The

City the opportunity to cross-examine what the PAB later described as the representative. The decision included no findings of fact apart from its

As to the sufficiency of the evidence issues, Dan’s City argues that the

that the PAB erred: in requiring it to present its case first; in not giving Dan’s testimony and what it considered to be the testimony of the NHDOL before the PAB. Regarding the sufficiency of the process, Dan’s City argues sufficiency of the evidence, and the other to the sufficiency of the process used On appeal, Dan’s City makes two sets of arguments, one relating to the

In its decision, the PAB summarized the hearing, including Genest’s

failed to put forth sufficient evidence to justify a fine. closing.” Dan’s City then gave its closing statement, arguing that the State had were in fact not paid those hours.

p. 4 rounding system was erratic, and unable to determine if employees

signatures or initials.

Employees were paid commission only for these duties.

time possibly being deducted for those periods. The employer’s

showed additions and changes to those records, without employee

worked by employees performing towing evenings and weekends.

Records showed indications of lunch hours not being taken but

judgment of the facts for that of the PAB.

52 violations cited as employee time records for other hours worked first category (RSA 275-A:4-a), we need not address them here. evidence was sufficient. Because the PAB dismissed the 869 allegations in the

52 violations cited as the employer did not keep records of hours inspection report, which were sufficient to support its conclusion. context of the evidence presented.” worked by employees. Specifically; evidence presented as it deems appropriate, such weighing must be done in the The employer failed to keep a true and accurate record of hours

strict technical rules of evidence governing court proceedings.” under RSA 279:27, the inspectors stated: supporting facts. The State is also correct that we are not to substitute our In the portion of the report pertaining to the third category of violations

rules of evidence. We now examine each category of violation to determine whether the

Dep’t, 144 N.H. 194, 196 (1999). presented to it through the NHDOL representative’s testimony as well as the Appeal of Rockingham County Sheriff’s

have said before, “Although the board is free to weigh the validity of the

such evidentiary rules, however, does not permit a finding in the absence of N.H. 44, 55 (1999); N.H. Milk Dealers’ Ass’n, 107 N.H. at 340. The absence of

The State is correct in pointing out that the PAB is not bound by the

State argues that the PAB was free to look at the informal information Dealers’ Ass’n v. Milk Control Board, 107 N.H. 335, 340 (1966). As such, the

with the inspection report and its addenda, were sufficient evidence to support The State argues that Genest’s admissions during the hearing, combined

RSA 273:11-d, IV. fourteen violations of RSA 275:48. p. 5 seven violations of RSA 275:49 and Lab. 803.04, as well as thirteen of the

273:11-d, IV(d). clearly erroneous in view of the substantial evidence on the whole record. RSA records were not kept. Thus, the findings as to those 104 violations were

We therefore find sufficient evidence in the record to warrant the PAB finding of

this time. 5 documentation on file. No wage adjustment deemed necessary at any reference to a specific employee, specific days or specific times when deductions were made from employee’s [

violations in both categories, it was the task of the PAB to weigh the evidence. the amount deducted. Although witnesses for Dan’s City disputed the unauthorized deductions, including who was involved, when each occurred and The inspectors attached a list to the report detailing thirteen specific when each was hired.

advance wage payments or other purposes, without proper actual commission of specific violations. Missing from the inspectors’ report is sic] wages for loans, the State was required to produce evidence that would tend to support the The employer’s records indicate that on at least 14 occasions specific violations of RSA 279:27. To prove these violations at the PAB hearing, fourth. As to RSA 275:49 and Lab. 803.04, the inspectors wrote: report provides: violations in the second category and thirteen of the fourteen violations in the As for violations in the fourth category, RSA 275:48, the inspectors’

The inspectors also attached an addendum that lists the seven employees and

last payroll (pp ending 2/18/07) submitted for this inspection. the time this inspection [sic] the employer had 7 employees on the pay, day and place of payment etc. as required by this section. At The employer did not notify employees in writing as to their rate of

workers. These admissions, however, do not establish that there were 104

By contrast, there are specific references in the report for seven

possible at this time for either set of violation set [

their time cards every day and that he paid a flat rate or commission to some State points out that Genest testified that his employees had trouble filling out The report, however, provides no further details of the 104 violations. The

Due to inadequate or non-existent records, no wage adjustment is

time records could not be reconciled with the wages paid. Employer also had one or more employees on “flat rate” and the p. 6 $18,000 for those violations.

does, however, support thirteen violations of RSA 275:48 and seven violations the fourteen violations of RSA 275:48, we reverse those violations. The record

State does not get a “second bite at the apple.”

the PAB’s decision with regard to the 104 violations of RSA 279:27 and one of by failing to make specific findings of fact.

BRODERICK, C.J., and DALIANIS, GALWAY and HICKS, JJ., concurred. Where there is insufficient evidence to support an administrative decision, the

In sum, because we find that there was insufficient evidence to support the proper remedy is dismissal. This is not a case in which the PAB erred only

sufficient evidence. 197-98 (no remand if the board’s ruling is unsupported by the evidence). of the PAB’s decision. See Rockingham County Sheriff’s Dep’t, 144 N.H. at Rather, this is a case in which there was insufficient evidence to support part required remand when facts may or may not have supported the outcome). Concord, 115 N.H. 131, 134 (1975) (lack of findings in tax abatement case refused to make findings but could have); Trustees of Lexington Realty Trust v. Trust Co., 120 N.H. 753, 759-60 (1980) (remand appropriate when board

Where, as here, the State failed to meet its burden of proof, we hold that

remand for new proceedings is not the proper remedy where the record lacks Dan’s City, citing City of Rochester v. Smith, 121 N.H. 184 (1981), argues that opportunity to adjudicate the violations, including hearing new evidence. remanded to the PAB for further proceedings so that the PAB has another The State argues that, in the instance of reversal, this case should be