Opinion
Case No. 20040122-CA.
Filed March 10, 2005. (Not For Official Publication).
Original Proceeding in this Court.
Thomas J. Klc, Salt Lake City, for Petitioner.
Tiffany Vincent, Salt Lake City, for Respondent.
Before Judges Bench, Greenwood, and Orme.
MEMORANDUM DECISION
Petitioner Lorenz Rindlisbacher appeals the Workforce Appeals Board's (the Board) determination that he was not unemployed and that he made fraudulent misrepresentations to the Department of Workforce Services (DWS). We affirm.
The Board's rulings on Petitioner's self-employment and fraud are questions of fact. See Kearl v. Department of Employment Sec., 676 P.2d 385, 386-87 (Utah 1983). The Board's factual findings will be overturned only if they are "not supported by substantial evidence when viewed in light of the whole record before the court." Utah Code Ann. § 63-46b-16(4)(g) (2004). "[S]ubstantial evidence is that quantum and quality of relevant evidence that is adequate to convince a reasonable mind to support a conclusion." Atlas Steel v. Utah State Tax Comm'n, 2002 UT 112, ¶ 16, 61 P.3d 1053 (quotations and citation omitted).
Petitioner makes out three claims of error below. First, Petitioner argues that the Board erred in determining that his self-employment made him ineligible to receive unemployment benefits.
"A claimant is unemployed and eligible for benefits if" (1) the claimant is engaged in less than full-time work, (2) the claimant's income is less than his or her weekly benefit amount, and (3) the claimant is available for and seeking other full-time work. Utah Admin. Code R994-207-102(1).
There is substantial evidence in the record that Petitioner spent significant time building clients for his own recruiting business, rather than seeking full-time employment. For instance, Petitioner obtained a business licence, printed business cards and stationary, and purchased a mobile phone dedicated to drumming up clients. Additionally, Petitioner failed to keep the required "working log," designed to keep track of a claimant's job search. All told, Petitioner estimated that he spent approximately thirty-five hours a week on his self-employment-related projects. Indeed, Petitioner's self-employment activities were so extensive he had little opportunity to look for work. Thus, because there is substantial evidence that Petitioner was not available for and seeking other full-time work, he was not eligible for unemployment benefits.
Second, Petitioner argues that the Board erred when it imposed a fraud penalty on him. To demonstrate that a claimant committed fraud, DWS must establish three elements by a preponderance of the evidence: (1) materiality, (2) knowledge, and (3) willfulness. See Utah Admin. Code R994-405-502(1)-(3), -503(2)-(3). Petitioner challenges only the knowledge element.
Petitioner avers that, in the Unemployment Insurance Claimant Guide (the Guide), the sentence, "You must also report earnings from self-employment," is the only language in the "Work/Earnings Reporting" section applicable to self-employment. However, Petitioner misreads the Guide. His interpretation discounts the broad language of that paragraph's opening sentence — "All work and earnings while claiming benefits must be reported for the week in which you work." (Emphasis added.) Notwithstanding the Guide's requirement that Petitioner report all work, he knowingly failed to report his self-employment activity, and therefore, there is substantial evidence that Petitioner committed fraud as defined in DWS's rules.
Finally, Petitioner argues that his due process rights were violated because (1) he should have had counsel at the administrative hearings, (2) the Administrative Law Judge (ALJ) refused to call Petitioner's wife as a witness, and (3) DWS waived the fraud penalty against Petitioner.
Turning first to Petitioner's claim that he was denied the right to counsel, a copy of the Appeals of Unemployment Decisions Brochure, given to Petitioner when he was sent notice of his appeal, advised him of his right to have legal counsel. Furthermore, the ALJ reminded Petitioner of his right to counsel at the beginning of the telephonic hearing. Thus, Petitioner had implied and actual notice of his right to have legal representation, yet chose not to invoke that right.
Next, Petitioner asserts that the ALJ effectively denied his right to call his wife as a witness. However, after Petitioner concluded that his wife's testimony would not add anything relevant, Petitioner declined to call her. The ALJ did not thwart Petitioner's attempt to call a witness, as Petitioner now alleges, but rather asked Petitioner about the substance of her testimony. Ultimately, Petitioner, not the ALJ, decided not to call Petitioner's wife. Moreover, excluding Petitioner's wife's testimony was harmless, as it would have neither added to nor aided Petitioner's defense.
Finally, Petitioner claims that DWS waived the fraud penalty when a DWS representative told Petitioner's attorney over the phone that Petitioner was not assessed a fraud penalty. However, DWS "has no authority to reduce or otherwise modify . . . the monetary penalties imposed by statute." Utah Admin. Code R994-405-504(1). Because the DWS representative lacked the authority to modify or reduce the statutorily imposed fraud penalty, Petitioner's penalty was not waived.
Accordingly, the Board's determinations are affirmed.
WE CONCUR: Russell W. Bench, Associate Presiding Judge and Gregory K. Orme, Judge.