Opinion
No. 15–P–685.
06-10-2016
Nubar HAGOPIAN & another v. MASSACHUSETTS COMMISSION AGAINST DISCRIMINATION & others.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
Plaintiffs Nubar Hagopian and Newbury Guest House, Inc. (collectively, Hagopian), appeal from a Superior Court judgment that denied their motion for judgment on the pleadings and affirmed a decision by the Massachusetts Commission Against Discrimination (MCAD). The MCAD had affirmed a decision by an MCAD hearing officer, who determined that Hagopian had engaged in unlawful employment discrimination and awarded damages to two former employees. Hagopian argues that the MCAD abused its discretion in imposing a twelve percent interest rate on the damage awards. We affirm.
Background. In November, 2005, two former Hagopian employees filed complaints with the MCAD alleging that they were subjected to unlawful discrimination in violation of G.L. c. 151B. The complaints were joined and, following a public hearing, an MCAD hearing officer found that Hagopian had discriminated against the employees and that his “conduct was sufficiently deliberate and egregious to warrant the imposition of a civil penalty.” The hearing officer awarded back pay and emotional damages to both employees, “with interest thereon at the rate of 12% per annum until such time as payment is made or this order is reduced to a court judgment and post-judgment interest begins to accrue.”
Hagopian petitioned the full MCAD for review of the decision, arguing, among other things, that imposition of a twelve percent interest rate is “grossly excessive, and thereby confiscatory and unconstitutional as a matter of law.” Hagopian posited that application of a twelve percent interest rate is inappropriate “in the current market conditions,” and that it is not rationally related to the purpose of G.L. c. 231, § 6B. After a review, the full MCAD “decline[d] to alter” the hearing officer's ruling with respect to the interest rate, holding that the rate of twelve percent per annum continues to serve the important purpose of eradicating the evil of discrimination “and assists in making victims of discrimination whole.” The MCAD reversed the back pay award to one of the employees and affirmed the hearing officer's decision in all other respects.
Hagopian sought review pursuant to G.L. c. 30A, § 14, and G.L. c. 151B, § 6, by a judge in the Superior Court. In a written memorandum of decision and order, the judge “decline[d] to declare an interest rate unconstitutional that has been upheld by the judiciary and maintained by the legislature for over thirty years.” He denied Hagopian's motion for judgment on the pleadings, and he affirmed the decision of the MCAD. Hagopian timely appealed.
Discussion. Our review of the MCAD's decision is limited, Trustees of Health & Hosps. of Boston, Inc. v. Massachusetts Commn. Against Discrimination, 449 Mass. 675, 681 (2007), and Hagopian seeks review only insofar as the MCAD affirmed imposition of the interest rate set forth in G.L. c. 231, § 6B. The issue was properly raised, and “we examine the administrative record to determine if the decision is supported by substantial evidence, giving deference to the fact-finding function of the commission, and we review for other error of law.” Ibid.
We see no error of law and conclude that the MCAD's decision is supported by substantial evidence. Hagopian does not challenge the finding that he engaged in employment discrimination, and, in light of that finding, the MCAD had “broad authority to ‘take such affirmative action ... as, in the judgment of the commission, w[ould] effectuate the purposes of this chapter. ’ “ Stonehill College v. Massachusetts Commn. Against Discrimination, 441 Mass. 549, 567 (2004), quoting from G.L. c. 151B, § 5. He does not challenge the hearing officer's conclusion that his discriminatory conduct was “deliberate and egregious,” which supports the MCAD's determination that imposing the statutory rate would effectuate the purposes of G.L. c. 151B, by “deterring, and punishing, instances of discrimination by” Hagopian against his employees. Stonehill College v. Massachusetts Commn. Against Discrimination, supra at 563. The Supreme Judicial Court “long ago approved” of a twelve percent interest rate on damages awarded for unlawful employment discrimination, DeRoche v. Massachusetts Commn. Against Discrimination, 447 Mass. 1, 14(2006), and we agree with the MCAD that applying that rate in this case “will further the purpose of eradicating the evil of discrimination [.]” Ibid. The back pay and emotional distress awards “are compensatory in nature, [so] they do not fall within the prohibition on prejudgment interest on damages which serve a purpose other than to make the plaintiff whole [,]” Salvi v. Suffolk County Sheriff's Dept., 67 Mass.App.Ct. 596, 608(2006), and adding interest to the awards was permissible “so that [Hagopian's] employees do not suffer a loss in value, due to the passage of time, of their earnings awarded as damages.” Brown v. Office of the Commr. of Probation, 87 Mass.App.Ct. 729, 733 (2015). To the extent that Hagopian challenges the constitutionality of a twelve percent interest rate “under the current market conditions,” we note that “any interest rate set by statute enjoys a rebuttable presumption that it is a reasonable rate that would satisfy constitutional requirements.” Liberty Square Dev. Trust v. Worcester, 441 Mass. 605, 612 (2004) (discussing interest rate on an eminent domain award). Imposition of interest at a rate of twelve percent per annum continues to be rationally related to the Commonwealth's goals of eradicating discrimination in the workplace and “provid[ing] the damaged party with a return on the money it might otherwise have had were it not for the wrongdoing of [the employer],” Lawrence Sav. Bank v. Levenson, 59 Mass.App.Ct. 699, 711 (2003).
Judgment affirmed.
Newbury Guest House, Inc., doing business as Hagopian Hotels.