Floyd v. Anne Arundel Cnty., 0633

GALLEN G. FLOYD v. ANNE ARUNDEL COUNTY, MARYLAND, ET AL.

No. 0633

COURT OF SPECIAL APPEALS OF MARYLAND

September Term, 2014

October 7, 2015

UNREPORTED

Graeff, Berger, Davis, Arrie W. (Retired, Specially Assigned), JJ.

Opinion by Berger, J.

*This is an unreported opinion, and it may not be cited in any paper, brief, motion, or other document filed in this Court or any other Maryland Court as either precedent within the rule of stare decisis or as persuasive authority. Md. Rule 1-104.

This appeal arises out of an order of the Circuit Court for Anne Arundel County affirming the decision of the Board of Appeals ("Board") for the Department of Labor, Licensing, and Regulation ("DLLR") denying appellant's, Gallen Floyd's ("Floyd's"), application for unemployment insurance benefits. Floyd contends that the Board's finding that he was terminated because he committed gross misconduct was not supported by substantial evidence. Additionally, Floyd avers the Board erroneously considered hearsay evidence in violation of procedural due process.

On appeal, Floyd presents two issues for our review,¹ which we rephrase and reorder as follows:

1. Whether the Board erred in considering hearsay evidence.

2. Whether the Board's finding of gross misconduct was supported by substantial evidence.

For the reasons set forth below, we shall affirm the judgment of the Circuit Court for Anne Arundel County.

FACTUAL AND PROCEDURAL BACKGROUND

Between September 15, 1988, and July 18, 2012, Floyd was employed by the Anne Arundel County Department of Public Works ("County"). On July 18, 2012, Floyd was terminated upon allegations of theft of County property. In the years prior to Floyd's termination, the County had been replacing its iron manhole covers with plastic covers. Pursuant to this initiative, iron manhole covers were collected and transferred to a facility in Glen Burnie, Maryland, where they were stored in a basket next to a scrap metal dumpster until they were to be sold as scrap. The proceeds from the sale of iron manhole covers were to be returned to the County. On October 10, 2011, between 100 and 150 iron manhole covers were transported to the Glen Burnie facility. Thereafter, sometime between October 24, 2011, and October 31, 2011, the iron manhole covers disappeared.

On October 28, 2011, the County received a phone call from Detective R.J. Gibson of the Anne Arundel County Police Department to inquire as to whether Floyd or another employee, McKinney, were agents of the County. Detective Gibson further informed the County that Floyd had appeared in the Regional Automated Property Information Database ("RAPID") for selling iron manhole covers for scrap. Following Detective Gibson's telephone call, the County observed that its iron manhole covers were missing.

The RAPID revealed that on May 27, September 13, September 23, and October 26, 2011, Floyd sold manhole covers to the Baltimore Scrap Corporation. Furthermore, scale tickets obtained from the Baltimore Scrap Corporation showed that Floyd transacted with the Baltimore Scrap Corporation for $238.00 on September 13, 2011; $369.60 on September 23, 2011; and $341.60 on October 25, 2011.² These scale tickets bore the signature of Floyd certifying that he had the right to possess and sell the scrap. Moreover, an employee of the Baltimore Scrap Corporation informed law enforcement that Floyd and McKinney had attempted to sell additional manhole covers for scrap on October 28, 2011. On October 28, 2011, however, Floyd and McKinney had been turned away because they lacked documentation demonstrating they were in lawful possession of the covers they intended to sell.³

Floyd and McKinney also possessed security access cards to the Glen Burnie facility to grant them access to the facility after hours. Records produced from the electronic gate at the facility indicate that on October 13, 2011, Floyd and McKinney entered the facility just after 9:15 p.m. On October 23, 2011, two days before the October sale, Floyd entered the facility at 8:53 p.m., and again at 10:02 p.m. On October 24, 2011, the day before the October sale, McKinney entered the facility at 10:43 p.m. Finally, Floyd and McKinney entered the facility at times between 3:00 a.m. and 4:00 a.m. on October 28, 2011, the morning of the unsuccessful sale. Although neither Floyd nor McKinney had exclusive access to the facility at the above-referenced times, Floyd and McKinney were the only individuals who were not accessing the facility in a paid capacity or for other legitimate work purposes. Critically, records introduced into evidence further reflected that Floyd and McKinney were on leave October 25, 2011 and October 28, 2011.

Floyd and McKinney soon became the subject of a criminal investigation. As part of the investigation, Detective Gibson interviewed McKinney, who informed Detective Gibson that Floyd and McKinney had taken items from the County's dumpster and sold them for scrap. McKinney further testified that after the Baltimore Scrap Corporation refused to transact with them on October 28, 2011, Floyd threw the materials on the side of the road. Thereafter, Detective Gibson interviewed Floyd, who admitted that he had taken water meter frames from the yard three or four times and that he sold the frames to Baltimore Scrap Corporation. As a result of Detective Gibson's criminal investigation and a County personnel investigation, the County concluded the Floyd took and sold County owned property. Accordingly, the County terminated Floyd's employment.

Floyd subsequently filed a request for unemployment insurance benefits with the DLLR. On September 12, 2012, a claims specialist denied Floyd's request for benefits on the basis that Floyd was discharged for circumstances that amount to gross misconduct. Floyd then requested a hearing, which took place on October 15, 2012. On October 15, 2012, the hearing examiner heard testimony from Floyd and Mark Tyler, the County's human resource manager. The hearing examiner reversed the decision of the claims specialist, finding the evidence insufficient to support a finding of gross misconduct. The County then appealed the hearing examiner's decision to the Board. On March 29, 2013, the Board reversed the hearing examiner's decision and found that Floyd had committed gross misconduct thereby precluding him from receiving unemployment benefits. Thereafter, Floyd appealed the Board's decision in the Circuit Court for Anne Arundel County. The circuit court affirmed the Board's decision.

Floyd then filed this timely appeal. Additional facts will be discussed as necessitated by the issues presented.

STANDARD OF REVIEW

"'When reviewing an administrative agency decision, our role is precisely the same as that of the circuit court.'" Parham v. Dep't of Labor, Licensing, & Regulation, 189 Md. App. 604, 612 (2009) (quoting Tabassi v. Carroll Cnty. Dep't of Soc. Servs., 182 Md. App. 80, 85 (2008)). The standard of review in an appeal from the final decision of the Board is set forth in Md. Code (1991, 2008 Repl. Vol.), § 8-5A-12(d) of the Labor and Employment article ("LE"), which provides:

In a judicial proceeding under this section, findings of fact of the Board of Appeals are conclusive and the jurisdiction of the court is confined to questions of law if:

(1) findings of fact are supported by evidence that is competent, material, and substantial in view of the entire record; and

(2) there is no fraud.

LE § 8-5A-12(d).

"'Under this statute, the reviewing court shall determine only: (1) the legality of the decision and (2) whether there was substantial evidence from the record as a whole to support the decision.'" Thomas v. Dep't of Labor, Licensing, & Regulation, 170 Md. App. 650, 657 (2006) (quoting Dep't of Labor, Licensing, & Regulation v. Hinder, 349 Md. 71, 77-78 (1998)). Moreover, "[w]e 'may not reject a decision of the Board supported by substantial evidence unless that decision is wrong as a matter of law.'" Thomas, supra, 170 Md. App. at 658 (quoting Hernandez v. Dep't of Labor, Licensing, & Regulation, 122 Md. App. 19, 23 (1998)).

DISCUSSION

In the case sub judice, Floyd avers the Board impermissibly considered hearsay evidence when rendering its decision to deny him unemployment benefits. Additionally, Floyd asserts that the decision to deny him unemployment benefits was not supported by substantial evidence. We shall address these arguments in turn.

I. Hearsay in Administrative Hearings

Floyd contends that notwithstanding the fact the Board is not bound by the general prohibition of hearsay, the admission of hearsay statements against him here violated his procedural due process rights. The County maintains, however, that the issue of admissibility was not properly preserved. Alternatively, the County and the Board argue that the hearsay evidence admitted here satisfies the safeguards imposed by procedural due process requirements.

A. Preservation

When reviewing an agency's conclusion of law, we "may not pass upon for the first time issues not encompassed in the final decision of the administrative agency." Cross v. Balt. City Police Dep't, 213 Md. App. 294, 307 (2013). Indeed, "an appellate court will review an adjudicatory agency decision solely on the grounds relied upon by the agency." Dep't of Health & Mental Hygiene v. Campbell, 364 Md. 108, 123 (2001). In the context of judicial review of administrative proceedings regarding the denial of unemployment benefits, we require that the administrative agency be provided the opportunity to decide upon an allegation of error so as to adequately develop the record for appellate review. Parham, supra, 189 Md. App. 604, 615-16 (2009) ("'ordinarily,' an appellate court will not decide an issue 'unless it plainly appears by the record to have been raised in or decided by the trial court, but the Court may decide such an issue if necessary or desirable to guide the trial court or to avoid the expense and delay of another appeal.'" (quoting Md....