Opinion
DOCKET NO. A-2878-13T3
01-27-2016
ROBERTO HALAL, Appellant, v. BOARD OF REVIEW and CONTINENTAL AIRLINES, INC., Respondents.
Erica J. Mandell, attorney for appellant. John J. Hoffman, Acting Attorney General, attorney for respondent Board of Review (Lisa A. Puglisi, Assistant Attorney General, of counsel; Christopher M. Kurek, Deputy Attorney General, on the brief). Respondent Continental Airlines, Inc., has not filed a brief.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges O'Connor and Rothstadt. On appeal from the Board of Review, Department of Labor, Docket No. 426,028. Erica J. Mandell, attorney for appellant. John J. Hoffman, Acting Attorney General, attorney for respondent Board of Review (Lisa A. Puglisi, Assistant Attorney General, of counsel; Christopher M. Kurek, Deputy Attorney General, on the brief). Respondent Continental Airlines, Inc., has not filed a brief. The opinion of the court was delivered by ROTHSTADT, J.A.D.
Roberto Halal appeals from the Department of Labor (Department), Board of Review's (Board) final decision affirming the decisions of the Appeal Tribunal of the Division of Unemployment Insurance (Division), which required him to repay unemployment compensation benefits to which he was not entitled and, because he obtained those benefits through fraud, disqualified him for benefits for one year and imposed a fine. The Board's decision was based upon its finding that Halal knowingly misrepresented himself by failing to report his income from his continued part-time employment with respondent Continental Airlines (Continental).
On appeal, Halal contends the Board improperly assumed he acted fraudulently, ignored exculpatory evidence, or at least failed to indicate it considered such evidence, and improperly applied a "per se policy to find fraud." He further argues that he was deprived of a "full and fair opportunity to present evidence," and that he should be required to refund only the difference between the benefits he received and those he would have received had he reported his part-time earnings. The Board disagrees and contends it correctly "determined that Halal falsely reported his earnings . . . which rendered him liable for a refund, disqualified for benefits for one year and subject to a fine."
We have considered the parties' arguments in light of our review of the record and applicable legal principles. We affirm.
We discern from the record that the material facts were largely undisputed. The only issue to be resolved was the reason for Halal's failure to report his continued part-time employment during the period he received benefits. The facts can be summarized as follows.
Halal filed his claim for unemployment benefits on May 15, 2011, after he was discharged by his full-time employer, Madison Chatham Joint Meeting (MCJM). At the time, he was working part-time for Continental, which he declared on his initial claim for benefits. However, during the ensuing reporting periods Halal indicated in certifications that he was not working or earning wages. Specifically, he answered "no" to question seven — "Did you work?" — when certifying for benefits for the weeks ending October 1, 2011 through May 5, 2012. Thus, Halal received benefits at the full rate for approximately seven months.
When the Department conducted an audit of his claim, it obtained evidence that Halal had been receiving wages from part-time employment while collecting benefits and had failed to disclose his income from this employment. On September 7, 2012, the Department mailed Halal a notice detailing the potential overpayment, which included instructions for him to respond and warned that failure to do so would result in the Department basing its determination on the information provided by his employer. Although Halal claimed he responded to the notice by requesting time to retain an attorney, the Division denied receiving a response. As a result, on October 12, 2012, the Division's Director sent Halal a notice of its determination that he had received $16,736 in benefits for which he was ineligible, demanding he refund that amount, and imposing penalties for his receipt of benefits by willful misrepresentation. The penalties consisted of disqualification for benefits for one year from the date of mailing and a fine of $4,184, representing twenty-five percent of the amount overpaid.
Halal filed an appeal from the Director's determination and participated in a hearing conducted by the Appeal Tribunal's appeals examiner on August 9, 2013. Halal was represented by counsel at the hearing.
At the hearing, the parties did not dispute that Halal had disclosed his part-time employment when he first applied for benefits, that he had failed to report this employment thereafter, or that he had testified to this employment at a prior hearing regarding his termination by MCJM. Halal did not challenge that he received benefits, the amounts he received, or the amounts he earned from his employment with Continental. He also did not dispute receiving literature from the Division that described his reporting obligations, though he did not recall the portion that discussed his obligation to report part-time earnings.
Halal nevertheless argued that his failure to report his part-time employment did not constitute fraud because, "based upon his interactions with people at the Division" during which he had disclosed his part-time employment, he did not think he was supposed to report those earnings. Though he initially testified that he answered "no" to question seven because he believed it related only to his job with MCJM, not Continental, he also claimed that he had attempted to use the Division's online system to declare his part-time employment but, when he tried to respond "yes," the program "shut [him] off." He testified that he called a Division Call Center to obtain help and described the problem to a representative, who "just told [him] . . . okay, you will receive this amount and you have to continue claiming every other week." Significantly, Halal did not testify that the representative instructed him to respond "no" to the question when he reported his employment status thereafter.
Halal testified that, when he continued to have trouble with the online system, he went to the Division's office in Elizabeth and spoke to "Ms. Lopez" about the problem. According to the Division, its records indicated Halal met with "L. Lopez" in July 2011 but that the meeting pertained to an appeal that related to his termination by MCJM and had just been resolved. Halal testified that he told Lopez he had "trouble finishing" the online certification for benefits when he tried to respond "yes" to the question about whether he was working, but Lopez just "tap[ped] on her computer" and told him "this is what [he was] going to get and . . . continue claiming after two weeks." Halal admitted that he did not tell Lopez that he was working, only that he tried to answer "yes," and that he did not tell her why he tried to answer "yes" because Lopez "didn't ask [him]." Finally, he confirmed that Lopez never told him he was not required to report his earnings when certifying for benefits thereafter.
Although no documents relating to it are contained in the record, we glean from the testimony that the dispute pertained to an initial period of ineligibility for benefits due to MCJM terminating his employment for cause. During the hearing in the case before us now, Halal's counsel made reference to her client's testimony at the MCJM hearing and alleged he stated during that hearing that he was working part time with Continental. However, a transcript of that hearing was not introduced at the Appeal Tribunal's hearing, so is not part of the record before us in this case.
After considering the evidence, the appeals examiner issued the Appeal Tribunal's written decision on August 12, 2013, determining Halal illegally received benefits. The appeals examiner found that Halal received the Division's literature setting forth his obligation to report his earnings while certifying for continued benefits each period, that he responded "no" to question seven when certifying for benefits for the weeks ending October 1, 2011 through May 5, 2012, and that he received the full benefit rate for the entire period. The appeals examiner determined Halal "did not return any checks to [the Division] during this period nor did he disclose . . . that [his] partial benefit rate was not reduced by his part-time earnings." He also listed for each week the amount Halal received in benefits and the income he received for his part-time employment, and noted Halal did not dispute these amounts.
The appeals examiner rejected Halal's contention that he "misunderstood [his] obligation to disclose his part-time earnings," finding it was not "a reasonable excuse for [his] failure to disclose [the] earnings . . . for 32 weeks." He concluded his findings by stating that, because Halal had the literature that described his reporting obligations, he "knowingly misrepresented [him]self as totally unemployed . . . [and] knowingly made false statements to receive benefits" by answering "no" to question seven, making his "receipt of benefits . . . [the] result of false or fraudulent representation[s]." Based on these findings, and relying on N.J.S.A. 43:21-16(a), (d)(1), and -5(g)(1), the appeals examiner upheld the Director's determination, demand for a refund of $16,736, and imposition of a one-year disqualification period and fine of $4184.
The appeals examiner's decision also cited N.J.A.C. 12:17-14.2 in support of Halal's obligation to refund the benefits he wrongfully received. As that section gives the Director the authority to waive such recovery, we presume the examiner intended to reference N.J.A.C. 12:17-14.3, which requires repayment of any amounts overpaid. --------
Halal appealed to the Board, which affirmed the Appeal Tribunal's decision after considering the matter without further hearing. In its written decision, the Board noted that it agreed with the Appeal Tribunal's decision and that Halal "did not advise the deputy that he was employed and therefore because of that the deputy would not have advised to report his earnings."
This appeal followed.
Our review of decisions by administrative agencies is limited, with claimants carrying a substantial burden of persuasion. See In re Stallworth, 208 N.J. 182, 194 (2011). "In order to reverse an agency's judgment, an appellate court must find the agency's decision to be 'arbitrary, capricious, or unreasonable, or [] not supported by substantial credible evidence in the record as a whole.'" Ibid. (alteration in original) (quoting Henry v. Rahway State Prison, 81 N.J. 571, 580 (1980)). "[I]f substantial evidence supports the agency's decision, 'a court may not substitute its own judgment for that of the agency's even though the court might have reached a different result." In re Carter, 191 N.J. 474, 483 (2007) (citation omitted) (quoting Greenwood v. State Police Training Ctr., 127 N.J. 500, 513 (1992)).
In considering the evidence, "the reviewing court should 'give due regard to the opportunity of the one who heard the witnesses to judge . . . their credibility.'" Clowes v. Terminix Int'l, Inc., 109 N.J. 575, 587 (1988) (quoting Close v. Kordulak Bros., 44 N.J. 589, 599 (1965)). "[I]t is not for us or the agency head to disturb [a] credibility determination, made after due consideration of the witnesses' testimony and demeanor during the hearing." H.K. v. State, 184 N.J. 367, 384 (2005). However, "we are 'in no way bound by the agency's interpretation of a statute or its determination of a strictly legal issue.'" Utley v. Bd. of Review, Dep't of Labor, 194 N.J. 534, 551 (2008) (quoting Mayflower Sec. Co. v. Bureau of Sec, 64 N.J. 85, 93 (1973)).
Applying these principles, we conclude the Board's decision was supported by substantial credible evidence in the record and we discern no basis for disturbing it. See In re Stallworth, supra, 208 N.J. at 194; see also R. 2:11-3(e)(1)(D). The Appeal Tribunal, affirmed by the Board, determined Halal's explanation for why he did not believe he had to report his part-time earnings was not credible. He presents no persuasive argument that such finding lacked sufficient factual proof, especially in light of his admission that he received the Division's literature that explained his reporting obligations. Cf. Orzel v. Bd. of Review, Dept. of Labor, 386 N.J. Super. 338, 341 (App. Div. 2006) (finding the record lacked evidence of deliberate misrepresentation where claimant "did not receive either an orientation or the unemployment booklet that would have explained the benefit system and conditions for receipt of benefits" and "[t]here [was] no evidence to suggest that his failure to report his part-time earnings was the result of anything other than incorrect advice received from his part-time supervisor"). Here, Halal received the literature and there was no evidence that anyone, including Lopez, told him he did not have to report his employment status accurately.
Given our conclusion, Halal's remaining arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). Suffice it to say, there was no need for the Board to produce Lopez as a witness because Halal did not testify that she told him to answer "no" when asked whether he was working. Further, his claim that he should only have to refund the difference between the benefits he collected and what he would have received had he reported his part-time wages, without fine or disqualification, is without legal support. If an employee obtains benefits fraudulently, the consequences include more than repayment. An employee may be required to refund all benefits received, including those to which the employee was otherwise entitled, such as benefits for partial unemployment. See Malady v. Bd. of Review, 76 N.J. 527, 531 (1978) (interpreting N.J.S.A. 43:21-16(d)); see also N.J.S.A. 43:21-16(d)(1) (requiring the refund of any benefits paid to ineligible recipients); N.J.S.A. 43:21-16(a) (providing for imposition of a fine); N.J.S.A. 43:21-5(g)(1) (disqualifying a person from obtaining benefits "for a period of one year from the date of the discovery by the division of the illegal receipt or attempted receipt of benefits . . . as the result of any false or fraudulent representation).
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION