Thornton v. Commissioner of Dept. O ( 1980 )

NO. 80-134
I N THE SUPREME COURT OF THE STATE OF M N A A
OTN
1980
W Y E THORNTON,
AN
P l a i n t i f f and A p p e l l a n t ,
THE COMMISSIONER OF THE
DEPARTMENT OF LABOR AND
INDUSTRY, STATE O MONTANA,
F
Defendants and Respondents.
Appeal from: D i s t r i c t Court of t h e F i f t h J u d i c i a l D i s t r i c t ,
I n a n d f o r t h e County o f J e f f e r s o n , Montana
Honorable Frank B l a i r , Judge p r e s i d i n g .
C o u n s e l o f Record:
For Appellant:
P a t r i c k F. F l a h e r t y a r g u e d , B o u l d e r , Montana
F r o Respondents:
M a r r a , Wenz, Iwen a n d J o h n s o n , G r e a t F a l l s , Montana
James G a r d n e r a r g u e d , Dept. o f L a b o r , H e l e n a ,
Montana
Submitted: November 2 1 , 1980
Decided: DEC 2 q f$j@($j
Mr. J u s t i c e Gene B. D a l y d e l i v e r e d t h e O p i n i o n o f t h e C o u r t .
On A u g u s t 1 0 , 1978, a p p e l l a n t f i l e d a wage c l a i m w i t h
t h e Commissioner o f t h e Department o f Labor and I n d u s t r y . A
c o n t e s t e d c a s e h e a r i n g was h e l d i n G r e a t F a l l s o n November
14, 1978. The hearings officer ruled in favor of
respondents. On M a r c h 11, 1 9 7 9 , appellant petitioned the
District Court of the Fifth Judicial District, i n and for
t h e County o f Jefferson, for judicial review of the final
agency decision. The District C o u r t d i s m i s s e d appellant's
p e t i t i o n f o r j u d i c i a l review. Appellant appeals.
A p p e l l a n t was e m p l o y e d as a t r u c k d r i v e r b y r e s p o n d e n t s
John and Simone Furgeri on or about July 17, 1978. He
terminated his employment on August 4, 1978, due to
nonpayment o f wages. A p p e l l a n t was h i r e d f o r $ . 1 3 p e r m i l e
plus $3.00 per hour for unloading and loading. Appellant
claimed he drove 7,250 miles ($942.50), worked 62 hours
($186.00), and accumulated $86.39 in expenses, totaling
$1,214.89 due.
On November 14, 1978, an administrative hearing was
held. The hearings examiner determined there were no
e x p e n s e s d u e a n d t h a t a p p e l l a n t was therefore entitled to
$1,128.50 ($942.50 plus 186.00). The examiner a l s o found
t h a t r e s p o n d e n t s had p a i d a p p e l l a n t $500.00 on September 5
and $281.75 on October 13, 1978, in back wages. The
examiner subtracted $781.75 from $1,128.50 and found
appellant was entitled to $346.75. Pursuant to section
39-3-206, MCA, the examiner assessed a penalty on this
p o r t i o n o f t h e wages d u e which r e s u l t e d i n a n e t amount d u e
appellant of $693.50. [Due t o an arithmetical error the
hearings examiner found $492.50 due appellant; however,
using the same formula, the error was corrected at the
h e a r i n g on t h e p e t i t i o n f o r j u d i c i a l r e v i e w . ] The e x a m i n e r
a l s o denied a p p e l l a n t ' s prayer f o r attorney fees.
On appeal the District Court affirmed the examiner's
o r d e r and d e n i e d a p p e l l a n t ' s p e t i t i o n f o r r e v i e w .
There are two issues presented to this Court for
review:
1. Did the District Court err in affirming the
decision of the hearings examiner to assess a statutory
p e n a l t y t o t h e b a l a n c e due a t t h e t i m e o f t h e h e a r i n g r a t h e r
t h a n t h e amount d u e a t t h e i n i t i a t i o n o f t h e p r o c e e d i n g s ?
2. Did the District Court err in affirming the
d e c i s i o n of t h e h e a r i n g s e x a m i n e r r e f u s i n g t o award a t t o r n e y
f e e s t o appellant a t the administrative hearing level?
A p p e l l a n t c o n t e n d s t h a t s e c t i o n 39-3-206, MCA, imposes
a m a n d a t o r y p e n a l t y on a n e m p l o y e r who f a i l s t o p a y wages t o
an employee when the wages become due. By imposing a
penalty on $346.75, which was due at the time of the
hearing, rather than on $1,128.50, which was d u e at the
i n i t i a t i o n o f t h e p r o c e e d i n g s , t h e h e a r i n g s e x a m i n e r and t h e
District Court made a clear error of law in direct
c o n t r a v e n t i o n of t h e s t a t u t e .
A p p e l l a n t f u r t h e r c o n t e n d s t h a t s e c t i o n 39-3-214, MCA,
p r o v i d e s a m a n d a t o r y award o f a t t o r n e y f e e s and c o s t s f o r
e m p l o y e e s who s u c c e s s f u l l y p r o v e a c l a i m f o r u n p a i d wages.
The hearings examiner and the District Court erred in
f a i l i n g t o award a t t o r n e y f e e s and c o s t s a t e i t h e r s t a g e o f
the proceedings.
Respondents' position is t h a t t h i s case involves the
c o n s t r u c t i o n of two s t a t u t o r y p r o v i s i o n s - - s e c t i o n 39-3-206,
MCA (the penalty statute), and section 39-3-211, MCA (the
statute giving the commissioner discretion to settle or
adjust claims upon assignment). In an attempt to promote
settlements and avoid lengthy litigation, the commissioner,
pursuant to his section 39-3-211, MCA, authority,
compromised the penalty because the employer partially paid
the wages due appellant prior to the administrative hearing.
Respondents contend there exists a rebuttable presumption in
favor of the action of an administrative agency. In the
absence of a showing of manifest error by the party
challenging the agency action, the agency order is deemed
valid and enforceable. Appellant failed to meet his burden
of proof; therefore, the District Court's order affirming
the agency's decision should be affirmed.
Concerning the second issue, respondents contend that,
pursuant to section 39-3-214, MCA, an award of attorney fees
is provided for only when it is necessary to institute "a
suit at law" for the recovery of wages. An administrative
hearing is not a suit at law. Therefore, neither the
commissioner of the Department of Labor and Industry nor the
District Court has the authority to award attorney fees for
representation in an administrative hearing. The District
Court has statutory authority to award attorney fees on a
wage claim only for the legal work performed at the District
Court level.
When reviewing an administrative order, there exists a
rebuttable presumption in favor of the decision of the
agency, and the burden of proof is on the party attacking
it to show that it is erroneous. Partoll v. Anaconda Copper
Min. Co. (1949), 122 Mont. 305, 311, 203 P.2d 974; Kerns v.
Anaconda Copper Min. Co. ( 1 9 3 0 ) , 87 Mont. 546, 289 P. 563.
T h i s C o u r t may n o t s u b s t i t u t e i t s j u d g m e n t f o r t h a t of the
t r i a l c o u r t or agency a s t o t h e weight of t h e e v i d e n c e on
questions of fact. Section 2-4-704 ( 2 ) , MCA; Robins v.
Anaconda Aluminum Co. ( 1 9 7 8 ) , 1 7 5 Mont. 514, 575 P.2d 67.
W may r e v e r s e o r m o d i f y t h e d e c i s i o n i f s u b s t a n t i a l r i g h t s
e
of the appellant have been prejudiced because the
administrative findings, inferences, conclusions, or
decisions are clearly erroneous in view of the reliable,
probative and substantial evidence of the whole record.
Section 2-4-704(2)(e), MCA. I n Brurud v. J u d g e Moving and
S t o r a g e Company, Inc. ( 1 9 7 7 ) , 1 7 2 Mont. 249, 563 P.2d 558,
we d e t e r m i n e d that a finding is " c l e a r l y e r r o n e o u s " when,
although t h e r e is evidence t o support it, a review of t h e
entire record leaves t h e c o u r t w i t h t h e d e f i n i t e and firm
conviction that a mistake has been committed. See also
United S t a t e s v. U n i t e d S t a t e s Gypsum Co. ( 1 9 4 8 ) , 333 U.S.
364, 395, 68 S. Ct. 5 2 5 , 5 4 2 , 92 L. Ed. 746, 766.
We f i n d no s u c h p r e j u d i c e h e r e , and t h e decisions of
t h e a d m i n i s t r a t i v e a g e n c y and D i s t r i c t C o u r t a r e a f f i r m e d .
The r o l e of j u d g e s i n c o n s t r u i n g s t a t u t e s i s s t a t e d i n
s e c t i o n 1-2-101, MCA. This Court i n t e r p r e t e d t h a t r o l e i n
amm mil! v . Young ( 1 9 7 5 ) , 1 6 8 Mont. 81, 540 P.2d 971, which
h e l d t h a t t h e c o u r t may n o t o m i t w h a t h a s been i n s e r t e d i n
l e g i s l a t i o n nor i n j e c t what h a s been o m i t t e d . The d u t y o f
the court is simply to construe the law a s it finds it.
Dunphy v. Anaconda Co. ( 1 9 6 8 ) , 1 5 1 Mont. 76, 438 P.2d 660.
With t h i s mandate i n mind, we must now construe the two
s t a t u t e s which a r e t h e s u b j e c t o f t h i s l i t i g a t i o n .
S e c t i o n 39-3-206, MCA, provides:
"Any e m p l o y e r , a s s u c h e m p l o y e r is d e f i n e d i n
t h i s p a r t , who f a i l s t o pay any o f h i s e m p l o y e e s
a s p r o v i d e d i n t h i s p a r t o r v i o l a t e s any o t h e r
p r o v i s i o n o f t h i s p a r t s h a l l be g u i l t y o f a
misdemeanor. A p e n a l t y s h a l l a l s o be a s s e s s e d
a g a i n s t and p a i d by s u c h e m p l o y e r and become d u e
s u c h employee a s f o l l o w s : a sum e q u i v a l e n t t o t h e
f i x e d amount o f 5% o f t h e wages d u e and u n p a i d
s h a l l be a s s e s s e d f o r e a c h d a y , e x c e p t S u n d a y s
and l e g a l h o l i d a y s , upon w h i c h s u c h f a i l u r e
c o n t i n u e s a f t e r t h e d a y upon which s u c h wages
w e r e d u e , e x c e p t t h a t s u c h f a i l u r e s h a l l n o t be
deemed t o c o n t i n u e more t h a n 20 d a y s a f t e r t h e
d a t e s u c h wages w e r e d u e . "
S e c t i o n 39-3-211, MCA, provides:
"Whenever t h e c o m m i s s i o n e r d e t e r m i n e s t h a t o n e o r
more e m p l o y e e s h a v e c l a i m s f o r u n p a i d w a g e s , h e
s h a l l , upon t h e w r i t t e n r e q u e s t o f t h e e m p l o y e e ,
t a k e an a s s i g n m e n t o f t h e c l a i m i n t r u s t f o r s u c h
e m p l o y e e a n d may m a i n t a i n any proceeding
appropriate t o enforce the claim, including
l i q u i d a t e d damages p u r s u a n t t o t h i s p a r t . With
t h e w r i t t e n c o n s e n t o f t h e a s s i q n o r , t h e commis-
- n e r - -s- -t -e o r a a u s t a l l y c l a i m a s s i g n e d
sio may e t l -
pursuant t o t h i s section." (Emphasis added.)
The wage c l a i m s u b m i t t e d and s i g n e d b y a p p e l l a n t
provided : "I hereby authorize the Labor Commissioner to
approve a proposed compromise a d j u s t m e n t o r settlement of
the claim. In pursuance thereof, I authorize the Labor
Commissioner t o t r a n s f e r , s e l l o r a s s i g n t h i s c l a i m o r any
judgment t h e r e o n . " Pursuant t o the authority vested i n the
c o m m i s s i o n e r by s e c t i o n 39-3-211, MCA, h e compromised the
p e n a l t y on t h e $500.00 and $281.75 p a i d on S e p t e m b e r 5 and
October 13, 1978, r e s p e c t i v e l y .
In the last two fiscal years, the Labor Standards
D i v i s i o n p r o c e s s e d an a v e r a g e o f o v e r 900 wage c l a i m s p e r
year. Therefore, i n an a t t e m p t t o p r o m o t e s e t t l e m e n t s and
avoid lengthy l i t i g a t i o n , t h e c o m m i s s i o n e r compromised t h e
p e n a l t y on wages which w e r e p a i d p r i o r t o h e a r i n g . Such a
decision is within the commissioner's discretion and
f a c i l i t a t e s t h e p u r p o s e o f t h e Wage Payment A c t which i s t o
c o l l e c t u n p a i d wages o f employees. However, i n each c a s e ,
the ultimate liability should first be determined and,
t h e r e a f t e r , a compromise may be worked o u t from t h a t amount.
S e c t i o n s 39-1-102 and 39-3-209, MCA.
Appellant was entitled to $1,128.50; he was paid
$781.75. Therefore, $346.75 r e m a i n s d u e f o r u n p a i d wages.
R e s p o n d e n t s owe a p p e l l a n t a n a d d i t i o n a l $346.75 in penalty
p u r s u a n t t o s e c t i o n 39-3-206, MCA, b r i n g i n g t h e n e t amount
d u e a p p e l l a n t $795.50. Appellant has received a p o r t i o n of
wages d u e and is e n t i t l e d t o u n p a i d wages p l u s a p e n a l t y
imposed thereon. No s u b s t a n t i a l r i g h t s of a p p e l l a n t have
b e e n p r e j u d i c e d and t h e a d m i n i s t r a t i v e o r d e r i s a f f i r m e d .
A p p e l l a n t a s k e d f o r a n award o f a t t o r n e y f e e s . I t is a
well-settled principle t h a t attorney f e e s a r e allowable only
when p r o v i d e d f o r by c o n t r a c t o r s t a t u t e . S e c t i o n 39-3-214,
MCA, provides:
" C o u r t c o s t s and a t t o r n e y s ' f e e s . ( 1 ) Whenever
i t s h a l l become n e c e s s a r y f o r t h e employee t o
e n t e r o r m a i n t a i n a s u i t a t law f o r t h e r e c o v e r y
o r c o l l e c t i o n o f wages d u e a s p r o v i d e d f o r by
t h i s p a r t , a r e s u l t i n g judgment m u s t i n c l u d e a
r e a s o n a b l e a t t o r n e y ' s f e e i n f a v o r of t h e
s u c c e s s f u l p a r t y , t o be t a x e d a s p a r t o f t h e
costs in the case. ( 2 ) Any j u d q m e n t f o r t h e
p l a i n t i f f i n a proceeding pursuant t o t h i s a c t
must i n c l u d e a l l c o s t s r e a s o n a b l y i n c u r r e d i n
connection with the proceeding, including
attorneys' fees." (Emphasis added.)
S e c t i o n 39-3-212, MCA, provides:
"A d e t e r m i n a t i o n by t h e Commissioner of Labor and
I n d u s t r y made a f t e r a h e a r i n g may be e n f o r c e d by
a p p l i c a t i o n by t h e Commissioner t o a d i s t r i c t
c o u r t f o r an o r d e r o r judgment e n f o r c i n g t h e
d e t e r m i n a t i o n i f t h e time provided t o i n i t i a t e
j u d i c i a l r e v i e w by t h e e m p l o y e r p a s s e d . "
The p a r t i c u l a r l a n g u a g e of t h e s t a t u t e i n d i c a t e s t h a t
an administrative hearing is not a "suit at law." A
" d e t e r m i n a t i o n " made by t h e c o m m i s s i o n e r a s a r e s u l t o f t h e
h e a r i n g is n o t a "judgment." I n Massa v . D e p t . of S o c i a l &
R e h a b i l i t a t i o n S e r v i c e s ( 1 9 7 7 ) , 1 7 2 Mont. 60, 560 P.2d 895,
t h e a p p e l l a t e p r o c e d u r e s used c l o s e l y p a r a l l e l t h o s e used i n
the case a t bar. I n t h a t c a s e t h i s C o u r t awarded a t t o r n e y
f e e s o n l y f o r s e r v i c e s r e n d e r e d on a p p e a l . I n t h e absence
of statutory a u t h o r i t y we m u s t affirm the holding of the
District Court and the Department of Labor and Industry
denying a p p e l l a n t a t t o r n e
3
Affirmed.
W concur:
e
Chief J u s t i c e