Opinion
CV145035077S
08-16-2017
Susan Martell v. Administrator, Unemployment Compensation Act
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
Thomas J. Corradino, Judge Trial Referee.
The court will briefly review the history of this matter prior to the appeal to the superior court. The Unemployment Compensation Department (Administrator) made an initial decision that the defendant was overpaid $2,122.00 in unemployment benefits and was subject to a monetary penalty of $1,061.00 pursuant to Section 31-273(b)(2)(B) which states " (B) For any determination of an overpayment made on or after October 1, 2013, any person who has made a claim for benefits under this chapter (chapter 567) and has knowingly made a false statement or representation or has knowingly failed to disclose a material fact in order to obtain benefits or to increase the amount of benefits to which such person may be entitled under this chapter shall be subject to a penalty of fifty percent of the amount of overpayment for the first offense and a penalty of one hundred percent of the amount of overpayment for any subsequent overpayment."
The defendant appealed the administrator's decision pursuant to Section 31-242 of the general statutes. Pursuant to that statute a referee, to whom the appeal lies, heard the defendant's claim de novo and rendered a decision. This decision was appealed to the Board of Review pursuant to Section 31-249 of the General Statutes. After making twenty-six findings of fact, the Board affirmed the referee's decision and dismissed the appeal. A motion to correct was filed by the plaintiff pursuant to PB § 22-4 and the Board denied all the requested corrections except for a deletion of the last sentence of the referee's finding of fact No. 2 because " the referee's finding that at no time prior to July 14, 2012 had the claimant filed a claim for partial benefits is clearly erroneous because the claimant (defendant) filed a partial claim as early as February 12, 2012, according to the appeals packet transmittal which the referee entered into the record." The defendant then appealed the Board's decision to the Superior Court under § 31-249b of the General Statutes.
A
The court will briefly discuss the applicable law when it is deciding an unemployment compensation appeal. In United Parcel Service v. Administrator, Unemployment Compensation Act, 209 Conn. 381, 551 A.2d 724 (1988), the court considered the applicable standard of review. At page 385 the court stated that: " To the extent that an administrative appeal, pursuant to general statutes § 31-249b, concerns findings of fact, a court is limited to a review of the record certified and filed by the board of review. The court must not retry the facts nor hear evidence." But the court did go on to say that: " Although the court may not substitute its own conclusions for those of the administrative board, it retains the ultimate obligation to determine whether the administrative action was unreasonable, arbitrary, illegal, or an abuse of discretion." Id.
In JSF Promotions Inc. v. Administrator, 265 Conn. 413, 828 A.2d 609 (2003), the court also said that " failure to file a timely motion for correction of the board's findings in accordance with (Practice Book) § 22-4 prevents further review of those facts found by the board, " id., page 422, see generally foregoing Calnan v. Administrator, 43 Conn.App. 779, 686 A.2d 134 (1996).
As said in Belica v. Administrator, 126 Conn.App. 779, 12 A.3d 1067 (2011), " the board . . . is statutorily authorized to be the ultimate founder of fact, " id. at page 782.
Another procedural matter must be discussed in light of the issues the court has concluded are involved in this case. Upon appeal to the Superior Court under Section 31-249b: " The court may remand the case to the board for proceedings de novo, or for further proceedings on the record, or for such limited purposes as the court may prescribe. The court may also order the board to remand the case to the referee for any further proceedings deemed necessary to the court. The court may retain jurisdiction by ordering a return to the court of the proceedings conducted in accordance with the order of the court or the court may order final disposition."
Any order of remand in these unemployment compensation appeals must be made in the context of the previously discussed admonition by our court that the board " is statutorily authorized to be the ultimate finder of fact." Thus in Cennamo v. Administrator, 22 Conn.Supp. 302, 306, 170 A.2d 739 (1961) Judge Bordon said: " While the court cannot make a finding as a substitute for the commissioners, it may when the evidence calls for it, remand the case to the commissioners for a rehearing and finding of facts in accordance with the evidence." See also Slimada v. Administrator, 137 Conn. 380, 391-92, 77 A.2d 765 (1951); see also Southwest Appraisal Group, LLC v. Administrator, 324 Conn. 822, 844 fn.15, 155 A.3d 738 (2017); Higgins v. Landers Frary & Clark, 12 Conn.Supp. 391, 393 (King, J. 1943).
Judge Nadeau in McCulley v. Administrator, Unemployment Compensation Act, CV 96 0154447, (1997), discussed a remand which underlines the broad scope for remand under § 31-249b. In that case Judge Nadeau noted that he was remanding to appeal to the Board saying that: " The purpose of the remand is to enable this court to be given to understand whether the preceding determinations were unreasonable, arbitrary, or illegal. This limited scope of review is not comfortably possible on the current record." The court remanded but retained jurisdiction saying-that " Absent more pointed articulation of the conclusions reached and underlying rationale employed, this court feels unable to dismiss, sustain or reverse."
B
(i)
Turning specifically to the facts of this case the ambit of the appeal and the issues the court must decide are defined by the " Appeal to the Superior Court" filed on December 19, 2014. On the first page it states that " the issue in this case is whether the claimant, by properly reporting when she was paid for part-time work while never working over forty (40) hours per week according to her employer's work week but mistakenly reporting the hours worked can be found to have knowingly failed to make full disclosure with intent to defraud." But as one reads on there is more involved than a challenge to the finding of Fraud pursuant to § 31-273(b)(2)(B) of the general statutes. At page 3 of the document it states " I will not go into every little detail regarding the inaccuracies with the payroll records the state is relying on however, I did provide examples to the referee in my letter dated August 29, 2014, a copy of which is provided herein."
At trial the issue was then further narrowed however, from a monetary perspective. At page 5 of the transcript the following occurred:
The Court: You're not denying that she received more compensation than she was entitled to; are you?
Atty. Siciquano: I'm not denying that no, okay so that's a $2,000.00 figure or something.
On page 6 the following occurred:
The Court: So you're saying she didn't work the overtime they're claiming they (sic) did. (" she" obviously meant).
Atty. Siciquano: The number of hours, right. And the . . . and the . . . and the amount.
The Court: How many . . . how much of a difference would that make?
Atty. Siciquano: I . . . I out of the 2, 000.
The Court: Yeah.
Atty. Siciquano: I pointed out 500 and change.
The Court: Okay. So you concede maybe about $1,500.00 or so?
Atty. Siciquano: Yeah. And . . . And that's exactly what . . . it probably is almost a year now that we talked about this. I said, can't I just write you a check for . . . for the . . . you know, for the amount that we can agree on that is . . . is overpaid. Even though it was a mistake, you know, the plaintiff doesn't want the money if it wasn't due her. She was working she was working part-time.
Thus the plaintiff although admitting to an overpayment which must be reimbursed, contests the amount of the overpayment apart from any penalty claim under Section 31-273(b)(2)(B). But is not clear, to the court at least, how the plaintiff arrived at the conclusion that the claimed overpayment of unemployment compensation should be reduced by some five or six hundred dollars. The plaintiff's counsel attached an August 19, 2014 letter to the statements he submitted to the Appeals Referee and the Board of Review. He also refers to the letter on the first page of his brief. The second page of the letter makes a statement to the effect that the records of the Department of Labor and the employer Webster Bank do not correlate with each other resulting in a false claim of $324.80 for a pay period ending February 2012. There is a general reference to " Benefit Payment History" to support this position but no reference to particular portions of that history. There is also a claim, however, which is supported by reference to Webster Bank time records and reference to Department of Labor estimates, that the August, September 2012 period shows that Webster Bank reported 278.75 hours of work while the Department indicated 294.75 hours of work a 16-hour difference at $12.32 an hour indicating that there was not an overpayment of compensation benefits in the amount of $197.12. If we add $324.80 and $197.12 we arrive at $521.92 which the plaintiff alleges was incorrectly asserted to be an overpayment.
The only issue in this aspect of the case is not whether there was an overpayment but the exact amount thereof. As to the alleged incorrect claim of overpayment in the amount of $324.80 in the August 29, 2014 letter, as noted, there is a general non-specific reference to the " Benefit Payment History, " but no specific reference to the portions of that history and Webster Bank records which support that particular claim. In the plaintiff's written argument to the Board and in the appeal the same statement is made by the plaintiff: " I will not go into every little detail regarding the inaccuracies with the payroll records the state is relying on, I did provide examples to the Referee in my letter dated August 29, 2014, a copy of which is provided herein." That will not do to establish this portion of the argument that there was an incorrect determination of an overpayment of $324.80. It is true that the Unemployment Compensation Act is ameliorative in nature and it must be interpreted with that in mind, it is also true that self-represented parties are often involved in these appeals and consideration must be given to that fact. But here the plaintiff was represented by counsel who is also a CPA. The Board and the court on an ensuing appeal from the board's actions cannot be expected to wade through numerous pages of payment records to support a claim the plaintiff is making. In fact the very wording of the statement made to the Board and in the appeal papers quoted above, indicates plaintiff's counsel had in fact gone into the details of the payroll records to establish the inaccuracies of a portion of the overpayment claim not being made but he did not divulge how he arrived at the $324.80 figure. Although not directly on point Section 61-10 of the Rules of Appellate Procedure is instructive. It says in subsection (a) that " (a) It is the responsibility of the appellant to provide an adequate record for review." As said in Shamitz v. Taffler, 145 Conn.App. 132, 142, 75 A.3d 62 (2013), the court will not presume error in the absence of an adequate record.
The court has difficulty, however, in determining whether there was in fact an overpayment of benefits in the amount of $197.12 to the plaintiff in the August and September 2012 period. The Referee's decision and that of the Board do not specifically address the plaintiff's computations comparing the Webster Bank records and those of the Department of Labor which the plaintiff argues in her August 29, 2014 letter indicate per Webster she worked 278.75 hours as alleged by the Department of Labor. This is a relatively small amount in relation to the amount of the admitted overpayment but the plaintiff is entitled to having this issue addressed based on the specific calculations and references to the time records made in the August 29th letter. The court will retain jurisdiction but remands the matter to the Board which may remand it to the referee to specifically address the issue of this claimed overpayment by reference to pay statements or time records as to whether the plaintiff's argument with regard to this specific repayment justified and if not why not based on an examination of the records referred to above with an explanation explicitly referring to these records.
It is not the function of the court in these cases to decide the ultimate facts but it has to have the ability to intelligently review the ultimate facts claimed to have been found to determine whether an administrative action was reasonable and completely addresses the factual issues fairly raised in the action.
(ii)
The central contention in this case arises from the imposition of the penalty provided for in Section 31-273(b)(2)(B) which provides in relevant part " (f)or any determination of an overpayment on or after October 1, 2013 any person who has made a claim for benefits . . . and has knowingly made a false statement or representation or has knowingly failed to disclose a material fact in order to obtain benefits or to increase the amount of benefits to which such person may be entitled . . . shall be subject to a penalty of fifty percent of the amount of overpayment for the first offense and a penalty of one hundred percent of the amount of overpayment for any subsequent offense."
On page 83 of the record the referee gives a detailed discussion regarding the overpayments made to the defendant claiming they were based on the defendant's failure to report her earnings for an extensive period of time starting the week of February 11, 2012 then running from July 14, 2012-in effect she under reported her earnings. This is the basis of the referee's finding that the defendant was overpaid $2,122.00.
The court added all the figures and calculated the amount of overpayment should be $2,125.00.
The court cannot say on the basis of these findings that the conclusion that the defendant committed fraud cannot be supported by the record or is unreasonable. A continuous history of under reporting is noted and in large part is not contested by the defendant. In fact as noted at trial the defendant conceded that there was an overpayment of approximately $1,600.00. The estimation had to be based on a recognition of weeks of admitted under reporting.
However, the defendant argues that the finding of fraud was " ridiculous" in her appeal. It is conceded that a failure to indicate the receipt of wages or engagement in employment gives rise to an inference of fraudulent intent. But it is argued that " The inference can be overcome by evidence that the claimant was unaware he or she had to report his or her unemployment or there is an innocent explanation for the claimant's incorrect answers." Davis v. Administrator, No. 2204-BR-09 (3/18/10).
The defendant claimed in her appeal that the referee made an inference of fraudulent intent because " during February 11, 2012 the claimant answered yes to the second question which affirmed that she did not work part-time during the week ending the previous Sunday was not accurate."
The defendant made the same argument in her June 19, 2016 brief, her September 24, 2016 and January 23, 2017 briefs.
The defendant contests these conclusions on the February period saying she reported wages she received after her training period for the job. In an argument that seems unrelated, the defendant implies that the fraudulent intent finding seems in part also based on the referee's conclusion that the defendant was sent the guide book issued by the Department which explained her need to report her earnings. The defendant argues even if the Guide Book was sent she never received it because she moved to Cheshire.
The arguments were apparently not persuasive to the Board and are not persuasive to the court as evidence of an unreasonable finding of fraudulent intent. First the Davis case bears no relation to the factual setting of this case. In Davis the Board reversed the referee's finding of fraud in an unemployment compensation setting because it found an administrative representative advised the claimant erroneously that he did not have to report his weekly earnings.
Also what is interesting to note is that the defendant never contested the overpayments during numerous weeks having nothing to do with the February 2012 period so this, apparently is the raison d'etre for the concession of a $1,600.00 admission of overpayment. The argument that this can be regarded as a simple mistake is something the referee and Board were not required to accept and does not make their finding unreasonable or arbitrary which the court would have a right to reverse.
An interesting case although not directly on point, is United Parcel Service, Inc. v. Administrator, Unemployment Compensation et al., 209 Conn. 381, 551 A.2d 724 (1988). That case concerned an action brought by discharged employees seeking unemployment compensation benefits. Under Section 31-236 of the General Statutes a claimant is not entitled to benefits if he was discharged for " repeated willful misconduct." Willful misconduct or misbehavior does not translate into " fraud" as discussed in Section 31-273(b)(2)(B) but the concepts are closely enough related to make the court's comments of interest for this case. The court at pp 386-87 said: " The defendant does not contest the referee's principal factual finding that the employee's past carelessness or negligence constituted a pattern of willful misconduct. Further, as a matter of law, it is well established that disregard of the standards of behavior that an employer has a right to expect of his employees, by carelessness or negligence constituted a pattern of willful misconduct. Further it is well established that disregard of the standards of behavior that an employer has a right to expect of his employees, by carelessness or negligence of sufficient degree or frequency to show disregard for the employer's interests or equal culpability, constitutes willful misconduct" (citing several cases from this state and others).
The court will now try to discuss another claim made by the plaintiff which it is argued precludes a finding of fraud centering on the Guide Book, issued to applicants for unemployment compensation, which instructs them of their reporting responsibilities regarding the receipt of earnings from their employer.
In certain respects this other position taken by the defendant in regards to the Guide Book issue is not helpful to her position on the fraud question. It is claimed she did not receive the Guide Book, but in the August 29, 2014 letter sent to the Appeals Referee it states " d. The claimant only recalls receiving the Guide To Your Rights and Responsibilities When Filing for Unemployment Benefits in Connecticut once, when Evelyn in the Hearing Office in Hamden provided certain material to the claimant." Is not once enough. And would not an intelligent individual like the plaintiff know that under reporting earnings in an unemployment compensation context would raise the claim of fraud? In any event the issue of whether the defendant received the Guide Book is also confusing because of the language of another August 29, 2014 letter from defense counsel to the Appeals Referee. It states that the claimant was living in Darien managing a company and filed for unemployment benefits after helping that business wind up. It then says " The claimant moved to Cheshire on or about the same time and in fact never received the Guide to Your Rights and Responsibilities When Filing for Unemployment Benefits in Connecticut." (Emphasis by court.) The language, at least to the court confusing-if the defendant could have been living at a previous address before moving to Cheshire then traditional Connecticut law applies whereby it is held that if a letter is mailed to the right address with correct postage, it is presumed it was received. Precision Mechanical Services Inc. v. Scottsdale Ins. Co., CV98-0416692, 2006 [41 Conn.L.Rptr. 65, ]. Under mailbox rules the burden then shifts to the party denying receipt to present evidence rebutting the foregoing presumption, Echavarria v. National Grange Mutual Ins. Co., 275 Conn. 408, 880 A.2d 882 (2005).
On the other hand it could be argued that there is nothing in the record to indicate the guide was sent to the defendant but query why would not this agency send out this guide to any applicant which is central to its function? It is also true that the defendant did not testify or submit any document on this issue-denial of receipt of the guide is based on her lawyer's statement which is hearsay. Also as to the Guide Book issue plaintiff's counsel submitted a written argument to the Board. A paragraph on the second page refers to a letter that he sent to the Referee. He said: " I set forth in my letter that the claimant did not receive the Guide Book and in fact followed up with a letter faxed to the Referee establishing why the claimant had not received the Guide Book. The Referee decided to ignore the evidence which is not hearsay. The Referee also informed me he would not hold open the file for such evidence." It is not explained how this evidence is not in fact hearsay and the evidence counsel wished to offer which he said he was prepared to offer was not described.
In any event on the fraud issue it is not clear how the Guide Book issue fits into the argument. Is it being argued that the failure to receive the Guide Book would not defeat a defense against an over payment claim but would negate a finding of fraud?
The defendant also cites Aljahmi v. Administrator, CV02 0813725, (2002), supporting the position that confusion about computer-generated questions can provide a reason for concluding there was an absence of fraud upon a resulting overpayment. In that case, however, the plaintiff was of Arabic descent and had an imperfect knowledge of English. The court concluded that a compound question regarding part-time and full-time work was confusing to the plaintiff an individual because of his language proficiency. This is not the Aljahmi situation. Also only in that case one week of benefits was at issue here several weeks of under reporting was involved.
In addition although it is not explicitly argued with respect to rebutting the finding of fraud, throughout the record in communications from plaintiff's counsel are intimations that the Administration or the Appeals Referee decided things the way they did to put the plaintiff in a bad light or made determinations that were ridiculous, or did not permit counsel to present his position or made it apparent that he was going to decide against the plaintiff no matter what the evidence showed.
The fact that a fact finder makes what a litigant believes is an incorrect decision does not establish this was done because of personal bias against a party or is purposely finding facts for which there is no basis and intentionally doing so. Neither is mere reference to evidence not allowed in to establish a point or a defense determinative of the fairness of a proceeding if the evidence is not identified or explained.
Also such claims cannot be supported by conclusory assertions that counsel had for example, first hand knowledge that the plaintiff received the Guide Book when the substance of that first hand knowledge is not revealed.
Although specific instances of error in making overpayment calculations are referred to, the determination of overpayment is based on week after week of under reporting income. Plaintiff concedes that such overpayment occurred to the amount of $1,500 or $1,600.
Or to put it more exactly Section 31-273(b)(2)(B) said any person who knowingly makes a false statements so as to increase benefits " shall be subject to a penalty, " which is then described. (Emphasis by court.) Even if the Referee was wrong in certain of the calculations made and made these calculations solely to put the plaintiff in a bad light-though no basis for personal animosity is suggested-the record establishes a basis for the finding under the statute which requires a mandatory result, i.e., imposition of a penalty. The court cannot substitute a contrary finding.
Finally, in a brief filed January 23, 2017 the plaintiff argues that the main issue was that the plaintiff did not appear at the hearing (before the Referee) on August 29, 2014. The court agrees that her appearance might have been helpful to explain why any action or lack of action on her part that might have led to overpayments which are now admitted were a mere mistake not warranting a finding of fraud. The medical condition of her child is advanced as a reason for the non-appearance suffice it to say that if the plaintiff had requested a continuance of the August 29th hearing for the stated reason and it had been denied the court would have remanded the matter for a new hearing. However, the record is silent as to any request for a continuance on August 29, 2014 when the hearing was held with the presence of plaintiff's counsel or for any such request before that time although the child's medical condition was known before that date. The appeals Referee in his September 2014 report said simply: " The claimant did not participate in the hearing. The claimant's husband Attorney Robert Sicignano, Jr. Participated in the hearing on the claimant's behalf. Also one sentence in the plaintiff's January 23, 2017 brief is confusing. It says the medical procedure for the child occurred on August 19, 2014 in New York and plaintiff had just returned from a scheduled exam under anesthesia to make sure all was well with the (child's) eye on August 26, 2014" -but this return occurred three days before the hearing.
In materials sent to individuals prior to an Appeals Referee hearing the following introductory comments are made under the title: " Essential Information About the Referee's Hearing."
Who Should Attend the Hearing
A party that does not attend the hearing may lose the case. The appealing party will almost certainly lose if it does not show up to prosecute its appeal.
Witnesses with first hand-knowledge of the case must attend if you want to win your case. Hearsay testimony of an agent, friend or employee is usually not given as much weight as testimony of a witness who has first-hand knowledge.
You will not be granted another hearing unless you have a compelling reason for missing the hearing. If you absolutely cannot attend the hearing due to new employment, an emergency or for compelling reasons, call the Appeals Division immediately to see if any other arrangements are possible. Postponement of the Hearing
Postponements of the hearing are granted for good cause, such as a serious illness or other compelling reasons. Late requests will usually be denied.
You have to request a postponement of the hearing as far in advance of the hearing as possible. You should generally make the request by phoning the office, but you can also make the request in writing. Registered agents are required to make these requests by phone only.
At points during the record plaintiff's counsel states in addition to his child's sickness his wife missed many days of work and thus could not attend the hearing. But again no requests for a continuance to accommodate this problem were made and it does not belie the importance and value of testimony of the recipient of benefits, to rebut findings of overpayment or false reporting.
In any event for the foregoing reasons the court cannot reverse the Board's finding of a violation of Section 31-273(b)(2)(B) on a mere claim of mistake without more. It is not the court's function in hearing these appeals to assume the role of the ultimate finder of fact. It can only review the record to ascertain if there is a basis for any such finding and if the findings made are reasonable and do not violate any principle of law.
(1) The plaintiff cites Ray v. Administrator, 133 Conn.App. 527, 533, 36 A.3d 269 (2012), and Davis v. Administrator, 155 Conn.App. 259, 262-63, 109 A.3d 540 (2015), for the proposition that since a motion to correct the findings was filed in this case the court may review the facts in this case and is not bound by the Board's finding. What is not mentioned is that here the Board ruled on the plaintiff's motion to correct the findings making or repeating findings it had already made in deciding the motion. It would turn the law in this area on its head if the mere filing of a motion to correct which has been ruled upon below by making further findings displaces the Board's rule as the ultimate finder of fact.
Another argument the plaintiff raises against imposition of a penalty for fraud under the statute is based on laches. The plaintiff argues the defense of laches under Castonguay v. Plourde, 46 Conn.App. 251, 265, 699 A.2d 226 (1997), is comprised of two elements (1) a delay that was inexcusable, and (2) a delay that prejudiced the party alleging the defense of laches. It is argued that there was a two-year delay and because of that " she lost or discarded evidence such as pay stubs etc." -the overpayment and penalty decision was made July 7, 2014 by the Administrator, which was based on an overpayment deduced from a Certification of Earnings dated 7/26/12 and an additional Certification of Earnings dated 4/23/13. The plaintiff also argues in her January brief: " Furthermore the plaintiff's memory would not have faded regarding the procedures she used to report her hours each week." There is a factual problem with these assertions since they are based on hearsay. Also the argument is a difficult one to make since the plaintiff admitted at trial there was an over-payment of approximately $1,600, approximately 70% to 75% of the amount of overpayment claimed. Also plaintiff's counsel was able to prepare a letter, with no apparent difficulty, dated August 29, 2014 and submitted to the Board that argued from an examination of Webster Bank records that the Department of Labor " falsely" claimed an overpayment of $324.80 and for the period of August through October 2012 was able to deduce $197.12 was not overpaid.
The court is not aware, for example, that Webster Banks payment records are claimed to be inaccurate reflections of what the plaintiff actually earned or that any such records cannot be produced. As early as June 25, 2014 the plaintiff was notified of a predetermination hearing regarding possible overpayment of benefits and monetary penalty, suit was commenced on December 19, 2014 and she or her counsel would have known of the necessity of securing those records.
More basically, it would seem that " a general rule prevails that laches does not apply to state government actions and that states are not chargeable with the laches of their officials. Paralleling the federal government action cases, laches generally is inapplicable against state government actions that assert or seek to enforce public rights or interests, or where the state government is acting in its governmental capacity, in the exercise of a governmental function, or in pursuing a suit founded on a sovereign right. The considerable reluctance to apply laches in such cases stems from concerns that imposing laches may impair the functioning of the government body, and that valuable public interests may be jeopardized or lost by negligence, mistakes, or inattention of public officials. In addition, no claim of laches can be asserted against a town, " citing 12 Havemeyer Place Company, LLC v. Gordon, 76 Conn.App. 377, 820 A.2d 299 (2003), quote is from 27A Am.Jur.2d in article on " Equity, " Section 122, page 662. Numerous cases are cited for this proposition including the Connecticut case just referenced, see also Van Milligan v. Board of Fire and Police Commissioners, 158 Ill.2d 85, 630 N.E.2d 830, 833, 196 Ill.Dec. 665 (Lee, 1994); The State, Exrel Ohio State Racing Commission et al. v. Walton, 37 Ohio St.3d 246, 525 N.E.2d 756, 758 (Ohio, 1988); La Trieste Restaurant and Cabaret v. Village of Port Chester, 40 F.3d 587, 590 (1994), Capruso v. Village of Kings Point, 23 N.Y.3d 631, 992 N.Y.S.2d 469, 474-75, 16 N.E.3d 527 (Ct of App. Of N.Y., 2014).
There is some suggestion in the federal case law that in the most egregious cases laches can be used to abate government action or suit. U.S. v. Administrative Enterprises, Inc., 46 F.3d 670, 672-73 (CA7, 1995). This does not appear to be that case.
It is true that the overpayment issue was being investigated regarding the plaintiff's employment at Webster from the summer to late fall of 2012 but the first notice of alleged violations did not issue until June 25, 2014 over a year and a half later. But the Assistant Attorney General handling this matter represented that the administrator received records from the employer through 2013, see for example page 1 of the record, in order to investigate the matter. Also the defendant's counsel pointed out in its brief that the Administrator has to deal with thousands of these claims.
There is nothing in the record to indicate the administrator purposely delayed making his determination of overpayment and fraudulent intent so the state could take advantage of the penalty provisions of Section 31-273(b)(2)(B). Mere claims to that effect are not evidence. To turn to a realistic appraisal of this claim, what is involved here is the imposition of a penalty of approximately $1,000.00. By delaying the determination the statutory mechanism to collect the $2,122.00 overpayment is also delayed and it defies a reasonable assessment to believe, for the collection of a mere $1,000.00 the administrator would purposely delay his determination of overpayment and finding of fraud whether or not those findings are correct.
(iii)
In the plaintiff's January 23, 2017 brief Section 31-273(b)(2)(B) is referred to which as noted provides that for any determination of an overpayment on or after October 13, 2013 anyone who made a claim for unemployment compensation and knowingly made a false statement or failed to disclose a material fact to obtain or increase their amount shall be subject to a fifty percent penalty of the amount overpaid for the first offense and a hundred percent penalty of the amount of overpayment for any subsequent offense. The penalty shall be in addition to the obligation to repay any overpayment with thirty-five percent of it going to the Unemployment Compensation Trust Fund and sixty-five percent paid into the Employment Security Administration Fund. The plaintiff argues that she " was not put on notice of the enhanced additional, new and punitive penalty which is exactly what the prohibition of ex post facto laws was designed to avoid." No reference to case law or further legal argument is made to advance this ex post facto argument.
As said in Sekor v. Board of Education, 240 Conn. 119, 132, fn.11, 689 A.2d 1112 (1990): " Although the plaintiff frames her claim in terms of the ex post facto clause, this constitutional mandate has no applicability to a civil case. 'The ex post facto clause prohibits a state only from passing law which imposes a punishment for an act which was not punishable at the time it was committed or imposes additional punishment to that then prescribed . . .' The court quoted Payan v. Fairfield Hills Hospital, 215 Conn. 675, 683, 578 A.2d 1025 (1990), which quoting from a case discussing Article 10 of the federal constitution said 'The constitutional provision was intended to secure substantial personal rights against arbitrary and oppressive legislation . . . and not to limit the legislative control of remedies and modes of procedure which do not affect matters of substance.'"
It could be argued that merely because the state includes in civil legislation a particular section said to impose a penalty that does not immunize it from an ex post facto analysis. As is often the case, at least in this court's experience an analysis in Am.Jur.2d is instructive on this point. In the article on Constitutional Law at Section 692 at pages 113-14 the article says that:
In evaluating ex post facto claims under the state constitution the court applies what is commonly referred to as the " intent-effects" test: the court must first determine whether the legislature meant the statute to establish civil proceedings, and if the intention of the legislature was to impose punishment, then that ends the inquiry because punishment results; if, however the court concludes the legislature intended a non-punitive regulatory scheme, then the court must further examine whether the statutory scheme is so punitive in effect as to negate that intention thereby transforming what was intended as a civil regulatory scheme into a criminal penalty. A statute's rational connection to a non-punitive purpose is a most significant factor in a determination whether the statute's effects are not punitive for ex post facto purposes. However, the mere presence of a deterrent purpose is insufficient to render a sanction criminal for ex post facto purposes, as deterrence may serve civil as well as criminal goals.
Before subsection (b)(2)(B) was passed in 2013 a severe consequence was already imposed under what is now (b)(2)(A). Under that section false reporting dictated that any person who did so and received benefits " shall forfeit benefits for not less than one or more than thirty-nine compensable weeks following determination of such offense or offenses, during which weeks such person would otherwise have been eligible to receive benefits: " The subsection (B) amendment can be considered as covering a gap in the regulatory scheme in that it visits consequences on parties not likely to apply for benefits in the future. Perhaps more to the point is the second to last sentence of subsection (B) which apportions any such penalty between the Unemployment Compensation Trust Fund and the employment Security Administration Fund-in other words the subsection was enacted in 2013 not just to fill the general state coffers but to aid in the operation of the act. See State of New Mexico et al. v. Frank Foy and Suzanne Foy, 2015- NMSC 025, 355 P.3d 1 (2015).
Given the foregoing the court agrees with the observation in State v. Payan, 277 Neb. 663, 765 N.W.2d 192, 200 (2009), and concludes subsection (b)(2)(B) cannot be considered barred by ex post facto considerations. The court in Payan said: " if a court determines that the legislature intended a statutory scheme to be civil, that intent will be rejected only where a party challenging the (statute) provides the clearest proof that the statutory scheme is so punitive in either purpose or effect as to negate the state's intention." That has not been provided in this case.
It is true that when these overpayments were going on the plaintiff could not have been aware that a statutory provision would be enacted to allow for a penalty for knowingly submitting incorrect claims. But this scienter factor, while considered in cases discussing ex post facto, cannot be determinative or every ex post facto, cannot be determinative otherwise every ex post facto claim would prevail and this is especially true in a case where there were already severe consequences imposed for such actions in subsection (b)(2)(A).
Conclusion
The court finds that it has been established that there has been an overpayment regarding benefits of at least $1,927.88 and that a monetary penalty, based on that amount, should be imposed of $963.94.
However, for the reasons stated in this opinion, as a result of an August 29, 2014 letter submitted in the plaintiff's behalf, which is attached and the relevant part on the second page circled, the matter is remanded to the Board of Review to decide and fully explain whether and why a further overpayment in the amount of $197.12 is justified with an ensuing added penalty of $98.56. The remanding solely for that purpose. The court will retain jurisdiction and upon the Board's response to the remand will notify counsel if they wish to make response to the Board's decision on this limited matter.
Thomas Corradino, Judge Trial Referee
ATTACHMENT
ROBERT J. SICIGNANO, JR.
ATTORNEY AT LAW, LLC
Via Hand Delivery
Appeals Referee Edward Hawthorne
Employment Security Appeals Division
Re: Case Number: 2194 EE 14
Claimant: Susan V. Martell
Dear Appeals Referee Hawthorne, Reiterating, I represent the above referenced Claimant Susan V. Martell in all matters relating to the appeal of the overpayment as well as the request for abatement of the administrative penalty.
As a CPA as well as an attorney, I found it extremely difficult to determine the accuracy and thereby the reliability of the hours reported to the Department of Labor. It would appear that the hours reported to the Department of Labor on the Certification of Earnings runs from Monday through Saturday when the Employer's biweekly pay period runs from Thursday through the second Wednesday.
Regarding matters set forth in the Memo to the Appeals Division from Erin Bussiere, BPC dated July 31, 2014 I herein set forth the following:
a. In an effort to cast the Claimant in a bad light, the Memo states that " claimant's attorney indicates that prior to this experience his client had never COLLECTED unemployment benefits" going on to state that " the claimant in fact has FILED for benefits in the past." The TRUTH IS the Claimant has in fact never COLLECTED unemployment benefits in the past, A TRUE STATEMENT. The Claimant did FILE for benefits back in the BYE 2005 but found a job prior to collecting any benefits. The claimant has in fact NEVER COLLECTED unemployment benefits prior to this filing.
b. Again attempting to cast the Claimant in a bad light; the Memo states that " the claimant was able to report her earnings properly week ending July 7, 2012." The fact is the Claimant reported her earning correctly even according to the Department of Labor from the week ending after 2/11/12 through the week ending July 7, 2012.
c. The Memo also states that " during the weeks ending September 15, 2012, October 6, 2012, October 20, 2012 and October 27, 2012, the claimant actually worked 40 hours or more. During these weeks the claimant would have been considered fully employed." Again this is an attempt to cast the Claimant in a bad light when in fact the Claimant NEVER WORKED OVER 40 HOURS when computed using the Employer's pay period from Thursday through Wednesday.
d. The claimant only recalls receiving the Guide to Your Rights and Responsibilities When Filing for Unemployment Benefits in Connecticut once, when Evelyn in the Hearing Office in Hamden provided certain materials to the Claimant.Page two-August 29, 2014
Appeals Referee Edward Hawthorne
I've done my best to compare and contrast the manner in which the hours are reported between Webster Bank and the DOL below.
Per Webster Bank
Per Dept. of Labor
Pay Date
Hours
Claim WE
Hours
02/16/12
17.00 1st pay check
02/11/12
29
See Pay Statement
02/18/12 claimant
reports part time work
DOL falsely claims $324.80
overpaid
Claimant went for
See Benefit Payment History
training which she
was required to
successfully complete
for the job
03/15/12
40.00--two-week
pay period
03/29/12
40.00--two-week
pay period
04/12/12
40.00--two-week
pay period
See Pay Statement
08/30/12
65.25
08/18/12
38.50
See Pay Statement
08/25/12
32.00 70.50 hours
09/13/12
58.75
09/01/12
33.75
09/08/12
29.50 63.25 hours
09/27/12
77.25
09/15/12
45.50
See Pay Statement
09/22/12
35.50 81.00 hours
10/11/12
77.50
09/29/12
34.50
10/06/12
15.50 80.00 hours
278.75 hours
294.75 hours
16 hour difference
x $12.32 hour
= $197.12 not overpaid
Thank you.
Very truly yours, Robert J. Sicignano, Jr. CPA JD