Opinion
C.A. Nos. 98A-01-010-WTQ, 98A-03-004-WTQ.
Submitted: January 4, 2000.
Decided: January 13, 2000.
Letter Opinion and Order on the Appeal from the Unemployment Insurance Appeal Board — SUPPLEMENTAL MEMORANDA REQUESTED
Ronald L. Stoner, Esquire, 300 Delaware Avenue, Suite 1130, P.O. Box 89 Wilmington, DE 19899 for the Appellant, Richard Frunzi
Stuart B. Drowos, Esquire, Department of Justice, Carvel State Office Building, 820 N. French Street, Wilmington, DE 19801 for the Appellee. Department of Public Safety
James J. Hanley, Esquire, Department of Justice, Carvel State Office Building, 820 N. French Street, Wilmington, DE 19801 for the Unemployment Insurance Appeal Board
EXHIBIT A
Gentlemen:
Plaintiff, Richard Frunzi, the Employee-Appellant, has filed two separate appeals from two decisions of the Unemployment Insurance Appeal Board which are dated January 7, 1998 and February 4, 1998.
FACTS
Richard Frunzi was employed by the Division of State Police, Department of Public Safety as a Delaware State Trooper for approximately nine years before he was suspended without pay pending dismissal from his employment following a disciplinary hearing on September 15, 1997. On September 25, 1997, Mr. Frunzi applied for unemployment benefits from the Department of Labor. After an initial denial of benefits by a Claims Deputy, an Appeal Referee ruled in Mr. Frunzi' s favor following a hearing on October 21, 1997. A copy of the Referee's decision was mailed to the parties on November 13, 1997, with ten day appeal rights to the Unemployment Insurance Appeal Board.
By letter dated December 19, 1997, the Division of State Police, through counsel, in its capacity as Employer, wrote to the Department of Labor requesting leave to file an appeal beyond the ten day time limit. The gist of the excuse was that the opinion had been mailed to the Personnel Section of the Department of Public Safety rather than to the Division of State Police and, while Personnel had received the letter on November 18, 1997, counsel had not received it until December 12, 1997. Notwithstanding the fact that Employer's counsel was counsel of record at the time of the hearing before the Appeal Referee, he was not sent a copy of the opinion. The decision would become final in normal course on November 23, 1997. The Employer filed its appeal on December 19, 1997.
The UIAB considered the Employer's letter and ruled thereon on January 7, 1998 and mailed its decision on January 16, 1998. The Board evidently did not hold a hearing on this jurisdictional issue or give Mr. Frunzi any advance notice that it planned to act on the letter alone. The Board "on its own motion" determined to assume jurisdiction, citing Funk v. U.I.A.B., Del. Supr., 591 A.2d 222, 224 (1991). In so doing, the Board at least suggested a mailing mistake by employees of the Department of Labor prevented timely notice to the Employer. In particular, the Board noted the Employer's attorney, who appeared at the hearing conducted by the Appeal Referee, was not notified. On January 26, 1998, Mr. Frunzi appealed the Board's assumption of jurisdiction to this Court.
Despite the pendency of the appeal in this Court, the UIAB met on February 4, 1998 and took additional, evidence from the Employer regarding alleged employee misconduct. Mr. Frunzi and his counsel did not attend this hearing, evidently believing the first Superior Court appeal would stay further proceedings before the administrative Board. At the conclusion of this hearing, the Board denied the unemployment benefits to Mr. Frunzi, thus reversing the Appeal Referee on the merits. A second appeal was filed with the Superior Court requesting that the February 4, 1998 decision be reversed.
QUESTIONS PRESENTED BY THE BRIEFING
1. Did the Board err as a matter of law in not holding a hearing before assuming jurisdiction over the decision of the Appeal Referee on its own motion?
2. Did the Board abuse its discretion by assuming jurisdiction over the decision of the Appeal Referee on its own motion after, under 19 Del. C. § 3318(c), the time for a party appeal had elapsed?
3. Did the Board err as a matter of law in proceeding to determine the merits of the case after an appeal had been filed in this Court on the Board's earlier jurisdictional decision?
Question number 3 appears to be argued only indirectly in the briefing; it is not favored by an argument heading in the Employee's briefs.
4. Is the Board's denial of benefits to Mr. Frunzi supported by substantial evidence?
As a matter of procedure, it is hard not to be offended by what happened in this case. The Board ex parte on the basis of an unverified letter accepted jurisdiction without notice and without a hearing. The Board then knowingly proceeded effectively ex parte to hear the merits of the administrative appeal while an appeal to this Court was pending on its jurisdictional decision. The Board found against the non-appearing Employee who had brought the jurisdictional appeal to this Court. The Employer in the case is a State agency.
On the other hand, it might be said that Mr. Frunzi and his counsel ran the risk of just what happened by purposely not showing up at the hearing on the merits. Had they appeared, they may have even been permitted to make their jurisdictional argument. Indeed, none of the four points raised by the Employee are slam dunks for reversal. Unfortunately, the procedural sloppiness was not helped by either side or the Board. But the Court is troubled by a preliminary matter.
I guess I made the mistake of not stopping with the 1991 Supreme Court Opinion in Funk. But I am always curious about administrative procedures and administrative expertise and feel sometimes Courts muck things up out of ignorance.
Since the Supreme Court held there was no abuse of discretion by the Board in not acting on its own motion to assume jurisdiction, the Supreme Court could have possibly avoided holding that 19 Del. C. § 3320 gave the Board authority to act beyond the ten-day appeal period. But it is hard to disregard a holding that is labeled a holding. The difficulty with the Supreme Court Funk decision as precedent is twofold: first, it did not expressly suggest any time limit for the Board to act on its own motion; and, second, it never inquired about Rules and Regulations that may' govern Board proceedings.
The Court found in the New Castle County Law Library, with a receipt date of May 18, 1989, a list of 49 regulations (Regulation 1 being rescinded). of the list, Regulation 19, Section 4 is of particular interest, On inquiry, the Board kindly supplied the Court with a June 28, 1999 update of the same regulations from a Commerce Clearing House publication. Regulation 19, Section 4 remains unchanged. Indeed, the Law Library copy including backup which indicates Regulation 19, Section 4 has been unchanged since September 1953.
The Board also supplied a second group of Rules and Regulations — Rules and Regulations under Section 19 Del. C. § III, Title 19, Delaware Code, Unemployment Compensation, November 1979.
Not being involved on a daily basis with Board proceedings, it is of course possible that I might misunderstand its procedures. But it seems to me that Regulation 19, Section 4 is relevant to this appeal. I therefore ask counsel to review the Rules and Regulations of the Board and provide me with supplemental letter memoranda to be filed not later than January 26, 2000. The letter memoranda should address the question of whether this appeal is affected by any Rule or Regulation of the Board and, if so, how. If the issue of a regulation conflict with Funk arises, what does this Court do about Funk?
Sincerely,
William T. Quillen