Zackary Courtois v. D.s.h.s., State Of Washington ( 2017 )

Filed
Washington State
Court of Appeals
Division Two
September 12, 2017
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION II
ZACKARY COURTOIS, No. 49280-6-II
Appellant, UNPUBLISHED OPINION
v.
DEPARTMENT OF SOCIAL & HEALTH,
SERVICES,
Respondent.
BJORGEN, C.J. — This appeal involves the narrow issue of whether the superior court
abused its discretion by declining to award attorney fees to Zackary Courtois under the Equal
Access to Justice Act (EAJA), 5 U.S.C. 504.
From a young age, Courtois, due to his disabilities, received benefits from the
Developmental Disabilities Administration (DDA), which is a part of the Department of Social
and Health Services (Department). Upon reaching the age of 18, the Department determined that
Courtois was no longer eligible for DDA benefits. Courtois appealed that decision to an
administrative law judge (ALJ) and, subsequently, to the Department’s Board of Appeals
(Board). Both affirmed the Department’s action.
No. 49280-6-II
On appeal to superior court, the Department’s denial of benefits was reversed on two
bases: first, that the Department had committed an error of law in interpreting and applying the
dual diagnoses regulations, WAC 388-823-0720, -0740, and second, that substantial evidence
did not support its finding that Courtois’ adaptive skills test was not administered and evaluated
by a qualified professional. Courtois then moved the superior court for an award of attorney fees
under the EAJA. The superior court declined to award attorney fees because it determined that
the Department’s actions were substantially justified.
Courtois appeals the order denying EAJA attorney fees. He contends that the superior
court abused its discretion because its prior determinations that the Department committed an
error of law and that one of its findings was not supported by substantial evidence compelled the
conclusion that the Department’s position was not substantially justified.
We hold that the superior court did not abuse its discretion in denying attorney fees under
the EAJA. Accordingly, we affirm.
FACTS
In 2002 Courtois began receiving services from DDA. In November 2014 DDA
determined that Courtois no longer met DDA eligibility criteria to receive disability benefits.
Katherine,1 Courtois’ mother, contested that determination, believing Courtois’ recent autism
diagnosis qualified him for DDA benefits.
To aid in setting out the remaining facts of the appeal, we first summarize the legal
principles governing the benefits at issue.
1
Because Katherine and Zachary have the same last name, we refer to Katherine by her first
name. No disrespect is intended.
2
No. 49280-6-II
I. PERTINENT LAW
In order to qualify for DDA benefits, an individual must show that he or she has been
diagnosed with an intellectual disability that “[r]esults in substantial limitations.” See WAC 388-
823-0015; WAC 388-823-0200. One such eligible condition is autism. See WAC 388-823-
0500. In order to show that an individual’s autism “[r]esults in substantial limitations,” WAC
388-823-0015(1)(c), the individual must submit documentation showing (1) an adaptive skills
test score of more than two standard deviations below the mean and (2) a Full Scale Intelligence
Quotient (FSIQ) score of more than one standard deviation below the mean. See WAC 388-823-
0510; see WAC 388-823-0210. The adaptive test “must be administered and scored by
professionals who have a background in individual assessment, human development and
behavior, and tests and measurements, as well as an understanding of individuals with
disabilities.” WAC 388-823-0740(1)(a).
The adaptive skills and FSIQ scores cannot be attributable to an unrelated “mental illness
or other psychiatric condition occurring at any age; or other illness or injury occurring after age
eighteen.” WAC 388-823-0720, -0740. If an individual is “dually diagnosed” with a qualifying
condition and other unrelated conditions, the individual must provide “acceptable
documentation” that the qualifying condition, measured by the FSIQ and adaptive skills tests,
would meet the requirements for DDA eligibility without the influence of the unrelated
conditions. WAC 388-823-0720(2)(a), -0740(2)(a). “Acceptable documentation”
means written reports or statements that are directly related to the subject at issue,
reasonable in light of all the evidence, and from a source of appropriate authority.
The determination of whether a document is acceptable is made by DDA.
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No. 49280-6-II
WAC 388-823-0720 (2)(b), -0740(2)(b). “If no documentation is provided or DDA determines
that the documentation is not acceptable[,] DDA will deny eligibility. The determination may be
challenged through an administrative appeal.” WAC 388-823-0720(2)(c), -0740(2)(c).
II. HISTORY OF COURTOIS’ DIAGNOSES
Throughout his life, Dr. Heather Sue Daniels was Courtois’ primary doctor and
diagnosed him with a variety of conditions. Daniels diagnosed him with attention deficit
hyperactivity disorder (ADHD) in 2002 and “Static Encephalopathy secondary [due] to poor
early nutrition with failure to thrive” in 2004. Clerk’s Papers (CP) at 296. In 2007, Daniels
stated that “as he grows older he seems to be coalescing into an Asperger Syndrome picture[,]”
and again diagnosed him with ADHD and static encephalopathy as well as about nine other new
conditions.2 CP at 299.
In August 2013, when the Department was determining whether Courtois should continue
to receive DDA benefits, Daniels provided the following summary of Courtois’ diagnoses over his
lifetime, classifying them under different developmental categories:
Early Childhood
Failure to Thrive
Static Encephalopathy with development delay
Mid Childhood
ADHD
Asperger’s (Autism Spectrum Disorder)
New issues in the last two years
Sleep Disorder
Brain Tumor
2
These other diagnoses include cognitive impairment, obsessive compulsive disorder, speech-
language disorder, social learning disorder, sleep disorder, fine and gross motor dyspraxia, status
post failure to thrive, status post gastroesophageal reflux disease, and small stature.
4
No. 49280-6-II
Seizure Disorder
Episodes of memory loss with seizures
CP at 315.
The Department asked Daniels to clarify Courtois’ current diagnoses. In response, in
December 2013, Daniels submitted the following diagnoses pertinent to Courtois’ eligibility for
DDA benefits:
1. Encephalopathy . . . (brain damage) from inadequate feeding in infancy,
with seizure disorder and brain tumor
2. Autism Spectrum Disorder
3. Lack of Common Sense
See CP at 316.
In September 2014 Daniels completed a questionnaire and checklist, which implicitly
continued to diagnose Courtois with autism spectrum disorder. However, she did not rule out
encephalopathy, stating, “Zach’s social communications are better explained by [autism] than his
other disabilities.” See CP at 191 (emphasis added).
III. FSIQ AND ADAPTIVE SKILLS TESTS
In February 2013 Courtois received a neuropsychological evaluation, reflecting a FSIQ
score of 80. This score was more than one standard deviation below the mean. See WAC 388-
823-0510(2).
In April 2014 Courtois received an adaptive skills assessment. His mother, Katherine,
provided the ratings of Courtois’ adaptive skills. Brian Rice, a psychologist, scored and
interpreted those ratings. Rice found that Courtois scored in the extremely low range of adaptive
functioning and qualified as more than two standard deviations below the mean. WAC 388-823-
0510(1).
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No. 49280-6-II
IV. APPEALS PROCESS
In November 2014 the Department denied Courtois DDA benefits. Katherine contested
this determination, believing that Courtois qualified for DDA services because of his autism
diagnosis.
The matter went before an ALJ, who received testimony from witnesses and admitted
numerous exhibits, establishing the facts discussed in Parts I-III above. In addition, Daniels
testified that Courtois “only needs one . . . diagnosis . . . for his behavior stuff,” which was
“[a]utism spectrum disorder.” CP at 528-29.
Among other rulings, the ALJ determined that Courtois did not qualify for DDA benefits
because (1) Courtois failed to provide documentation that his 2013 FSIQ score was not
influenced by unrelated conditions such as ADHD and (2) Courtois’ April 2014 adaptive skills
score was unreliable because Katherine, who did not qualify as a professional under WAC 388-
823-0740(1)(a), provided the scores to Rice. Courtois appealed this decision to the Board.
The Board affirmed, agreeing with the ALJ that Courtois failed to provide documentation
that his 2013 FSIQ score was not influenced by unrelated conditions. The Board reasoned that a
prior evaluator, in 2002, had concluded that his ADHD influenced his FSIQ test, and that a
separate neuropsychological evaluation stated that his February 2013 FSIQ test may have been
influenced by other unrelated conditions. It also found that Daniels’ testimony that Courtois was
diagnosed only with autism
does not overcome the need to show that other conditions did not have a
disqualifying influence on the FSIQ score at the time the test was administered or
the fact that it was not Dr. Daniels who administered the test and, thus, was not in
a position to factually determine if the FSIQ score was unduly influenced by
condition(s) other than Autism Spectrum Disorder at the time of the testing. . . .
[T]he [FSIQ] score obtained in February 2013 and the date of this test precedes
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No. 49280-6-II
when Dr. Daniels was still dual diagnosing [Courtois] with other conditions in
August 2013 and December 2013 (Encephalopathy with seizure disorder and brain
tumor along with [autism], as well as noting a sleep disorder, a brain tumor, and
seizures resulting in episodes of memory loss).
CP at 52-53 (footnote omitted).
For similar reasons, the Board concluded that Daniels’ testimony was not “acceptable
documentation” that Courtois’ other diagnosed conditions at the time of the adaptive skills test
did not have an appreciable effect on his score. The Board noted that Daniels did not administer
the adaptive skills test, which made her unable to evaluate whether other conditions may have
influenced the score.
The Board also concluded that the adaptive skills score was invalid because there was no
evidence in the record that Katherine, who provided ratings of Courtois’ skills, was a qualified
professional under WAC 388-823-0740(1)(a).
Courtois moved for reconsideration, which the Board denied. The Board reaffirmed its
rulings regarding the FSIQ and adaptive scores, highlighting that Courtois failed to provide
“acceptable documentation,” WAC 388-823-0720 (2)(b), -0740(2)(b), that demonstrated his
other diagnoses did not contribute to his test score. CP at 9-10. However, in light of new
evidence Courtois submitted, the Board withdrew its decision that the adaptive test was not
administered by a qualifying professional under WAC 388-812-0740(1)(a). The Board implied
that even if it agreed with Courtois that the adaptive test was appropriately administered and
evaluated, its conclusions “regarding [Courtois’] failure to provide acceptable documentation
based on the dual diagnosis” was dispositive. CP at 10.
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No. 49280-6-II
Courtois appealed to the superior court. After a hearing,3 the superior court reversed the
Board’s decision and found that Courtois was entitled to DDA benefits. It entered the following
pertinent findings of fact and conclusions of law:
I. FINDINGS OF FACT
....
1.4 Zackary’s treating pediatrician[,] [Daniels,] determined that he meets the
diagnostic criteria for ASD [autism spectrum disorder] in 2013. She no
longer diagnoses Zackary with the multiple mental health conditions
identified in early and mid-childhood. The new ASD diagnosis replaced
those diagnoses. The doctor now attributes Zachary’s social, behavioral,
developmental, and cognitive deficits solely to his diagnosed ASD.
....
1.6 The record on appeal also contained evidence that Mr. Courtois has a DDA-
qualifying IQ score from testing conducted in February 2013, and a DDA-
qualifying adaptive function score from testing conducted in April 2014.
[Daniels] testified at the hearing that the cognitive and adaptive deficits
demonstrated by his DDA-qualifying IQ and adaptive test scores are
attributable to his ASD.
....
1.8 The [Board] determined that the DDA eligibility rules governing “dually
diagnosed” applicants apply in Zackary’s case, and prevent the Department
from accepting Mr. Courtois’ otherwise qualifying IQ and adaptive test
scores.
1.9 The [Board] also concluded that the record did not establish that the
qualifying adaptive function testing in the record was properly
“administered by a qualifying professional,” as required by the
Department’s rules.
3
The oral transcript of this hearing is not in the record.
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No. 49280-6-II
II. CONCLUSIONS OF LAW
....
2.4 The DDA eligibility rules that govern the Department’s review of IQ and
adaptive test results of “dually diagnosed” applicants are WAC 388-823-
0720(2) and WAC 388-823-0274(2).[4] By their plain terms, the
requirements in these rules apply only if an applicant is currently dually
diagnosed with a qualifying developmental disability and a separate mental
illness, or other psychiatric condition. The evidence presented at hearing in
this matter, including the testimony provided by [Daniels], establishes that
Mr. Courtois’ ASD diagnosis replaced his various childhood mental health
diagnoses. Since Mr. Courtois is not currently dually diagnosed with ASD
and any other mental illness, the [Board]’s application of WAC 388-823-
0720(2) and WAC 388-823-0274(2) in his case was an error of law.
2.5 The ASD diagnosis did not replace Mr. Courtois’ medical diagnoses of
seizure disorder and a sleep disorder. However, the [Board]’s determination
that these childhood medical diagnoses are dual diagnoses per WAC 388-
823-0720(2) and WAC 388-823-0740(2) was an error of law.
2.6 The governing DDA eligibility rules require that qualifying adaptive testing
must be “administered and scored” by a qualified professional. WAC 388-
823-0740(1)(a). The [Board]’s determination that the qualifying adaptive
function testing in this case was not properly “administered and scored” is
not supported by substantial evidence in view of the record as a whole.
2.7 The record in this case establishes that Mr. Courtois meets every listed
requirement for DDA eligibility in the Department’s rules based on his
diagnosed ASD, and his DDA-qualifying adaptive and IQ test scores.
CP at 622-25.
V. DENIAL OF EAJA ATTORNEY FEES
After these rulings, Courtois moved the superior court for an award of attorney fees and
costs pursuant to the EAJA, arguing that the Department was not “‘substantially justified’” in its
4
WAC 388-823-0274(2) is not an actual regulation. It appears that the superior court meant to
reference WAC 388-823-0740(2). Courtois, who proposed these findings of fact and
conclusions of law to the superior court, made the same mistake in his trial brief. Given the
superior court’s reasoning in its ruling, we interpret this regulation to be WAC 388-823-0740(2).
9
No. 49280-6-II
action. CP at 630 (quoting RCW 4.84.350(1)). The superior court disagreed and declined to
award attorney fees, determining that the Department was “substantially justified” and had a
“reasonable basis in law and fact” for its action. CP at 642.
In its oral ruling, the superior court specifically stated:
Well, we can all agree, I expect, that the issue here is solely whether the
Department’s actions were substantially justified within the meaning of the statute.
The outcome of the litigation, favorable to Mr. Courtois, it doesn't automatically
follow that the Department’s position was unreasonable and not substantially
justified.
I suppose it’s a little bit easier to argue in hindsight, since the Court decided
in favor of the petitioner, that the Department was not substantially justified. It’s a
little bit easier to argue that when the decision has gone the way of the petitioner.
I disagree with Mr. Carlisle, that the arguments by the Department were
difficult to make. The arguments made then and now, they don’t seem to me that
they were a reach. The arguments were made in good faith. They are very
interesting issues in this case.
The questions for the Court then were much closer questions than the
petitioner now asserts. The legal answers for me were not obvious. I believe the
Department’s arguments then were fair under both the law and the facts.
...
I will deny the motion.
Report of Proceedings (RP) at 15-16.
Courtois appeals the superior court’s determination that he was not entitled to an award
of attorney fees under the EAJA.
ANALYSIS
I. STANDARD OF REVIEW
We review a superior court’s decision whether to award attorney fees under the EAJA for
an abuse of discretion. Raven v. Dep’t of Soc. & Health Servs., 177 Wn.2d 804, 832, 306 P.3d
10No. 49280-6-II
920 (2013). A superior court abuses its discretion when it makes a decision that is manifestly
unreasonable, or based on untenable grounds or reasons. Id.II. EAJA ATTORNEY FEES
A. EAJA Legal Principles
Under the EAJA,
a court shall award a qualified party that prevails in a judicial review of an agency
action fees and other expenses, including reasonable attorneys’ fees, unless the
court finds that the agency action was substantially justified or that circumstances
make an award unjust.
RCW 4.84.350(1). In this appeal, there is no dispute that Courtois is a qualified party or that he
ultimately prevailed on the merits. Instead, the only pertinent question is whether the superior
court’s finding that the Department was “substantially justified” in its action was an abuse of
discretion.5
“‘Substantially justified means justified to a degree that would satisfy a reasonable
person.’” Raven, 177 Wn.2d at 832 (quoting Silverstreak, Inc. v. Dep’t of Labor & Indus., 159
Wn.2d 868, 892, 154 P.3d 891 (2007)). Put another way, “an action is substantially justified if it
had a reasonable basis in law and in fact.” Id. The agency action “need not be correct, only
reasonable.” Id. (citing Pierce v. Underwood, 487 U.S. 552, 566 n.2, 108 S. Ct. 2541, 101 L. Ed.
2d 490 (1988)). We look to “the strength of the factual and legal basis for the action, not the
manner of the investigation and the underlying legal decisions.” Silverstreak, 159 Wn.2d at 892.
5
The superior court did not make a finding “that circumstances make an award unjust,” the
alternative basis for declining to award a prevailing party attorney fees under the EAJA. RCW
4.84.350(1).
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No. 49280-6-II
“RCW 4.84.350(1) contemplates that an agency action may be substantially justified,
even when the agency’s action is ultimately determined to be unfounded.” Raven, 177 Wn.2d at
832. Whether an agency action was taken in good faith is a consideration in determining
whether an action was substantially justified. See Constr. Indus. Training Council v. State
Apprenticeship & Training Council of Dep’t of Labor & Indus., 96 Wn. App. 59, 68-69, 977
P.2d 655 (1999). An agency action is not substantially justified if it was “arbitrary, willful, or
capricious.” See Raven, 177 Wn.2d at 833.
B. Administrative Procedure Act Legal Principles
Washington’s Administrative Procedure Act (APA), chapter 34.05 RCW, governs
judicial review of an agency action. Crosswhite v. Dep’t of Soc. & Health Servs., 197 Wn. App.
539, 547, 389 P.3d 731, review denied, 188 Wn.2d 1009 (2017). As pertinent, a superior court
may reverse an agency action because the agency has erroneously interpreted or applied the law,
WAC 34.05.570(3)(d), or the agency order is not supported by substantial evidence, WAC
34.05.570(3)(e).
Whether the Department “has ‘erroneously interpreted or applied the law’ . . . is reviewed
under the error of law standard.” Beatty v. State Dep’t of Fish & Wildlife Comm’n, 185 Wn.
App. 426, 443, 341 P.3d 291, review denied, 183 Wn.2d 1004 (2015). Under the error of law
standard, a court may substitute its own judgment for that of the Department, although it must
give substantial weight to the agency’s view of the law it administers. Id. On the other hand,
“[a]n agency order is supported by substantial evidence if there is a sufficient quantity of
evidence to persuade a fair-minded person of the truth or correctness of the order.” Johnson v.
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No. 49280-6-II
State Dep’t of Fish & Wildlife, 175 Wn. App. 765, 772, 305 P.3d 1130 (2013) (internal quotation
marks omitted).
C. Substantial Justification
Courtois argues that the superior court abused its discretion in deciding that the
Department’s action was substantially justified because that decision is inconsistent with its
earlier adverse rulings against the Department. In those rulings, the court found that (1) the
Board committed an error of law and (2) its order was not supported by substantial evidence.
For the following reasons, we disagree.
1. Error of Law
The superior court concluded that the Board committed an error of law in its
interpretation of the dual diagnoses rules, WAC 388-823-0720, -0740, the rules that require an
individual’s FSIQ or adaptive skills scores not be attributable to an unrelated condition.
Specifically, the superior court determined that under their plain language the dual diagnoses
rules only apply “if an applicant is currently dually diagnosed with a qualifying developmental
disability and a separate mental illness or other psychiatric condition.” CP at 624 (emphasis
added). It further ruled that Daniels’ testimony established that Courtois’ more recent autism
diagnosis replaced his other childhood diagnoses. Therefore, the superior court concluded that
he was not “currently dually diagnosed,” and that the Board’s application of the dual diagnoses
regulations was an “error of law.” CP at 624-25.
As already noted, the propriety of the superior court’s interpretation and application of
the dual diagnoses rules, WAC 388-823-0720, -0740, is not before us. Instead, to determine
whether the Department’s position was substantially justified, we ask whether “it had a
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No. 49280-6-II
reasonable basis in law and in fact,” Raven, 177 Wn.2d at 832, and whether it was “arbitrary,
willful, or capricious.” See Raven, 177 Wn.2d at 833. We may also consider whether the
Department’s position was taken in good faith. See Training Council, 96 Wn. App. at 68-69.
The superior court found that the Department’s determination was substantially justified
because its arguments were not a “reach,” were made in “good faith,” and raised “very
interesting issues” and “close[] questions” to the court. RP at 15-16. The court also stated that
“[t]he legal answers for me were not obvious.” RP at 15-16.
Courtois argues, though, that the Department’s position could not be substantially
justified because the superior court based its interpretation of the dual diagnoses rules on their
plain language and implied that “[t]here was no ambiguous terminology, and no confused case
law or conflicting statutory provisions.” Br. of Appellant at 27. In support, Courtois
distinguishes the present case from Dep’t of Labor and Industries v. Lyons Enterprises, Inc., 186
Wn. App. 518, 542, 347 P.3d 464 (2015), aff’d, 185 Wn.2d 721 (2016), where we declined to
award EAJA attorney fees to the plaintiff. The Lyons court found that the Department was
substantially justified in its interpretation of the Industrial Insurance Act, Title 51 RCW, because
the case was “highly complex, involving the intersection of detailed statutes with somewhat
confused common law.” Id.Even if not in a setting as complex as Lyons, the superior court’s interpretation of the
dual diagnoses rules involved the interplay of multiple provisions and subsections, as well as
their applicability to a complicated set of facts. Further, the interpretation and application of the
rules on this issue have not been addressed in an appellate decision. Most importantly, at the
time of the February 2013 FSIQ test and April 2014 adaptive skills assessment, Courtois in fact
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No. 49280-6-II
had multiple diagnoses. Apart from his autism, the Department was substantially justified in
finding that his encephalopathy, for example, may have influenced those test scores. WAC 388-
823-0720(2)(a), -0740(2)(a).
Courtois argues, however, that the APA standards for finding an error of law necessarily
required that the superior court find that the Department’s action was not substantially justified.
Under the error of law standard, a reviewing court reviews de novo the “‘meaning and purpose
of a statute,’” but will accord “‘great weight’” to a statute or regulation that falls within the
agency’s expertise. See Puget Soundkeeper All. v. State, Pollution Control Hr’gs Bd., 189 Wn.
App. 127, 136, 356 P.3d 753 (2015) (quoting Pub. Util. Dist. No. 1 of Pend Oreille County v.
Dep’t of Ecology, 146 Wn.2d 778, 790, 51 P.3d 744 (2002)). Only if a rule’s plain language
“‘remains susceptible to more than one reasonable meaning’” after consideration of all relevant
statutory language is the statute ambiguous. See id. at 137 (quoting Dep’t of Ecology v.
Campbell & Gwinn, LLC, 146 Wn.2d 1, 9-10, 43 P.3d 4 (2002))
Thus, the superior court’s finding of an error of law based on the plain language of the
dual diagnoses rules necessarily requires that there was only “one reasonable meaning” to the
rules. If there is only one reasonable meaning, it does seem, at first glance, inconsistent for the
superior court to rule that the Department was still substantially justified in its position, i.e., that
it has a “reasonable basis in law and fact” for its action. Raven, 177 Wn.2d at 832 (emphasis
added).
However, the EAJA substantial justification standard also examines other factors, such as
whether the agency proceeded in good faith or was arbitrary, willful, or capricious in its action.
Compare Training Council, 96 Wn. App. at 68-69 with Raven, 177 Wn.2d at 833. Courtois does
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No. 49280-6-II
not argue that the Department’s action was arbitrary, willful, or capricious, and the superior court
specifically found that the Department’s reading of the dual diagnoses rules was in good faith.
More importantly, at the time of the February 2013 FSIQ test and April 2014 adaptive skills
assessment, Courtois had multiple diagnoses. Although found erroneous by superior court, it was
not unreasonable or irrational for the Department to read the dual diagnosis rules, WAC 388-
823-0720(2)(a) and -0740(2)(a), to apply to the time of the test.
Thus, even though the superior court found that the Department committed an error of
law based on the plain meaning of the dual diagnoses regulations, we cannot say, under these
circumstances, that the Department lacked a reasonable basis for its actions or that it acted
arbitrarily, willfully, or capriciously. Thus, the superior court did not abuse its discretion in
determining that the Department was substantially justified in its position.
2. Substantial Evidence
The superior court also ruled that substantial evidence did not support the Board’s finding
that Courtois’ April 2014 adaptive skills test was not properly administered and scored by a
qualified professional. Courtois argues that this conclusion required the superior court to
determine that the Department was not substantially justified in its action.
For his position, Courtois cites Thangaraja v. Gonzales, 428 F.3d 870, 874 (9th Cir.
2005) (quoting Al-Harbi v. INS, 284 F.3d 1080, 1085 (9th Cir. 2002)), which states that
it will be only a “decidedly unusual case in which there is substantial justification
under the EAJA even though the agency's decision was reversed as lacking in
reasonable, substantial and probative evidence in the record.”
We agree that based on the APA’s governing standards for substantial evidence, this holding
weighs in favor of finding that the Department was not substantially justified in its position.
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No. 49280-6-II
E.g., Chandler v. State, Office of Ins. Comm’r, 141 Wn. App. 639, 647-49, 173 P.3d 275 (2007)
(outlining the deferential substantial evidence rules).
However, a court’s determination that an agency finding was not supported by substantial
evidence does not compel the determination that the agency’s action was not substantially
justified. In Raven, the main issue was whether substantial evidence supported the Department’s
finding of guardian neglect. 177 Wn.2d at 829-31. The superior court disagreed with the
Department on the merits, and also awarded EAJA attorney fees to the guardian-plaintiff. Id. at
815, 831.
On appeal, our Supreme Court agreed with the superior court that the Department’s
finding of neglect was not supported by substantial evidence. Id. at 831. However, it found that
the superior court had abused its discretion in awarding EAJA attorney fees to the plaintiff. Id.
at 831-33. It found that the Department was substantially justified in its action because:
Regardless of whether [the guardian’s] conduct amounted to neglect, the record is
clear that [she] exhibited several significant shortcomings as a guardian. More to
the point, under the facts here, an agency would be reasonable in pursuing the same
course of conduct that DSHS followed.
Id. at 833. The Raven court also noted its hesitation to uphold an EAJA award when there has
been “no determination that [the Department]’s actions were arbitrary, willful, or capricious.”
Id. at 833. Under Raven, then, even if a finding is ultimately determined not to be supported by
substantial evidence, the underlying agency action can still be substantially justified.
In the present appeal, the superior court determined that the Department’s argument was
“fair . . . under . . . the facts,” “made in good faith,” and presented “very interesting issues.” RP
at 15-16. Again, we are not in the position of examining the merits of whether the agency
finding was supported by substantial evidence. Rather, we examine whether “it had a reasonable
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No. 49280-6-II
basis in law and in fact,” Raven, 177 Wn.2d at 832, and whether it was it was “arbitrary, willful,
or capricious.” See Raven, 177 Wn.2d at 833. We may also consider whether the Department’s
position was taken in good faith. See Training Council, 96 Wn. App. at 68-69.
WAC 388-823-0740(1)(a) states that adaptive skills tests “must be administered and
scored by professionals who have a background in individual assessment, human development
and behavior, and tests and measurements, as well as an understanding of individuals with
disabilities.” At the least, it was questionable whether Katherine had these qualifications. The
ALJ, in fact, determined that “[a]ppellant provided an adaptive skills test administered not by a
professional who has a background in individual assessment, as required by WAC 388-823-
0740, but by his mother.” CP 95. Against this background, the Department’s determination that
the adaptive skills test was not properly administered rested, at least, on a reasonable basis, even
though it was subsequently overturned by the court. In addition, the superior court made no
determination that the Department’s action was arbitrary, willful, or capricious, or done in bad
faith; nor does Courtois argue that it was.
Accordingly, we determine that the superior court did not abuse its discretion in
determining that the Department was substantially justified in its actions.
III. ATTORNEY FEES ON APPEAL
Courtois requests attorney fees on appeal pursuant to Costanich v. Washington State
Dep't of Soc. & Health Servs., 164 Wn.2d 925, 933–35, 194 P.3d 988 (2008), which held that a
party shall be entitled up to $25,000 in attorney fees on appeal under the EAJA. RCW 4.84.350.
However, attorney fees are available under RCW 4.84.350(1) only to prevailing parties. Because
Courtois does not prevail on appeal, we decline to award him attorney fees.
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No. 49280-6-II
CONCLUSION
The superior court did not abuse its discretion in declining to award Courtois attorney
fees under the EAJA. Consequently, we affirm.
A majority of the panel having determined that this opinion will not be printed in the
Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040,
it is so ordered.
BJORGEN, C.J.
We concur:
WORSWICK, J.
JOHANSON, J.
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