Baker v. Labor Commission

2015 UT App 127

THE UTAH COURT OF APPEALS

MATT BAKER AND SUNRISE HOME HEALTH CARE, LLC,
Plaintiffs and Appellants,
v.
LABOR COMMISSION, ANTIDISCRIMINATION AND LABOR DIVISION
AND JAZMIN SHELTON,
Defendants and Appellees.

Opinion
No. 20140279-CA
Filed May 21, 2015

Fourth District Court, Provo Department
The Honorable Claudia Laycock
No. 130400289

Robert O. Rice and Aaron K. Olsen, Attorneys
for Appellants
Sean D. Reyes, Nancy L. Kemp, and Ronald V.
Ludlow, Attorneys for Appellee Labor Commission,
Antidiscrimination and Labor Division
April L. Hollingsworth, Attorney for Appellee
Jazmin Shelton

JUDGE KATE A. TOOMEY authored this Opinion, in which JUDGES
JAMES Z. DAVIS and J. FREDERIC VOROS JR. concurred.

TOOMEY, Judge:

¶1 Sunrise Home Health Care, LLC and Matt Baker1
(collectively, Sunrise) appeal the district court’s decision
dismissing Sunrise’s petition for judicial review and ordering the

1. Matt Baker is the owner and administrator of Sunrise Home
Health Care, LLC.
Baker v. Labor Commission

Labor Commission to rescind its orders regarding Jazmin
Shelton’s wage claim.2 We set aside the district court’s decision.

¶2 Sunrise employed Shelton as a registered nurse, and they
entered into an ‚employee pay and benefits‛ agreement (the
Employment Agreement). Shelton left her employment. She later
filed a wage claim with the Labor Commission because Sunrise
had retroactively reduced Shelton’s pay rate for her last two
weeks of employment, contending it was the agreed to pay rate
for not providing written notice as required by the terms of the
Employment Agreement.

¶3 The Commission ruled that the Employment Agreement
was unlawful. Accordingly, it issued an Order to Pay requiring
Sunrise to pay Shelton $611.11, the difference between the
amount she earned at her regular pay rate and the reduced pay
rate. Moreover, the Commission ordered a statutory penalty
equal to the amount Sunrise withheld from Shelton and
statutory attorney fees of $500.

¶4 Sunrise requested agency review to reconsider the Order
to Pay, but the Commission denied the request. In its Order
Denying the Request for Reconsideration, the Commission
advised Sunrise of the right to appeal the ‚final agency action to
the District Court‛ pursuant to Utah Code section 63G-4-401.
Sunrise then sought review of the Commission’s orders in
district court. In its petition for review, Sunrise challenged the

2. We acknowledge Sunrise’s petition for judicial review of the
adjudicative proceedings was a ‚complaint‛ governed by the
Utah Rules of Civil Procedure, see Utah Code Ann. § 63G-4-
402(2)(a), but the district court’s order and the parties’ briefs
refer to the complaint as a ‚petition for judicial review.‛ We
therefore refer to Sunrise’s complaint as a petition for judicial
review for consistency.

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Baker v. Labor Commission

Order to Pay and asked for a declaratory judgment regarding
Sunrise’s wage reduction policy in the Employment Agreement.

¶5 During the course of the proceedings before the district
court, Shelton withdrew her wage claim and revoked her
assignment of the claim to the Commission. As a result, the
Commission moved to dismiss Sunrise’s claim as moot under
rule 12(b)(6) of the Utah Rules of Civil Procedure. In support of
its motion, the Commission attached a letter that purported to be
from Shelton withdrawing her wage claim. Sunrise challenged
the authenticity of the letter, but the court granted the
Commission’s motion to dismiss. It concluded Shelton’s letter
did not need to be authenticated because her attorney had
confirmed the withdrawal. The court also concluded that ‚there
is no action here that survives *Shelton’s+ withdrawal of her
action at the agency level‛ and ‚*s+ince the request for a
declaratory order on the contract is dependent on the judicial
review action, . . . the declaratory judgment action cannot
survive.‛ Accordingly, the court ordered the Commission to ‚re-
scind the Order to Pay and to rescind the portions of the Order
Denying Request for Reconsideration ordering compliance with
the Order to Pay, and otherwise to extinguish any order requir-
ing [Sunrise] to pay any wages or penalty‛ resulting from this
case.

¶6 On appeal, Sunrise contends the district court erred in
dismissing as moot its petition for judicial review because the
Commission lacked jurisdiction to ‚alter the status of the admin-
istrative action during the pendency of the petition for review.‛
The Commission argues that the district court properly
dismissed Sunrise’s petition because the court had no jurisdic-
tion over the petition as it became moot when Shelton withdrew
her wage claim. The decision to grant a rule 12(b)(6) motion is ‚a
question of law that we review for correctness, giving no
deference to the [district] court’s ruling.‛ Oakwood Vill. LLC v.
Albertsons, Inc., 2004 UT 101, ¶ 9, 104 P.3d 1226.

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Baker v. Labor Commission

¶7 We agree with Sunrise that Shelton’s withdrawal letter
did not moot the controversy.3 Shelton did not file the letter with
the Commission until after the Commission had entered its final
order and Sunrise had filed its petition for judicial review, thus
depriving the Commission of jurisdiction over the case. Because
the Commission lacked jurisdiction to alter or modify final
agency actions during judicial review, Shelton’s withdrawal
letter had no legal effect on the order and does not render
Sunrise’s petition moot. See Career Serv. Review Bd. v. Utah Dep’t
of Corr., 942 P.2d 933, 943 (Utah 1997).

When a party institutes proceedings to review a
decision or an order of an administrative agency,
the agency is deprived of its jurisdiction over the
matter during the pendency of the appeal. The
Supreme Court of Nevada states, ‚It is generally
accepted that where an order of an administrative
agency is appealed to a court, that agency may not
act further on that matter until all questions raised
by the appeal are finally resolved.‛

Id. at 943–44 (quoting Westside Charter Serv., Inc. v. Gray Line
Tours of S. Nev., 664 P.2d 351, 353 (Nev. 1983)). The Utah
Supreme Court emphasized that this rule is especially relevant
in situations ‚‘where the exercise of administrative jurisdiction
would conflict with the proper exercise of the court’s
jurisdiction.’‛ Id. (quoting Westside Charter, 664 P.2d at 353).

¶8 When the Commission denied Sunrise’s request for recon-
sideration, the Commission’s orders became final. Although the
Commission had jurisdiction over the underlying issue of

3. Sunrise also challenges the letter’s authentication. But, because
we conclude that Shelton’s letter had no legal effect on Sunrise’s
petition, see infra ¶ 10, we do not address the merits of this
argument.

20140279-CA 4 2015 UT App 127
Baker v. Labor Commission

Shelton’s wage claim during the administrative proceeding, it
did not have any such jurisdiction during the pendency of the
judicial-review proceedings. See id. at 943; see also Westside
Charter, 664 P.2d at 353 (noting that ‚where an order of an
administrative agency is appealed to a court, that agency may
not act further on that matter until all questions raised by the
appeal are finally resolved‛); cf. Whitfield Transp., Inc. v. Brooks,
302 P.2d 526, 529 (Ariz. 1956) (noting that if ‚an appeal to *a+
court has been perfected[,] the inferior tribunal loses all
jurisdiction of each and every matter connected with the case,
except in furtherance of the appeal‛ (citation and internal
quotation marks omitted)).

The rule is based on common sense. If a court has
appellate jurisdiction over a decision of an
administrative body, it would not be consistent
with the full exercise of that jurisdiction to permit
the administrative body also to exercise jurisdiction
. . . . The court’s jurisdiction over the subject matter
of an appeal must be complete and not subject to
being interfered with or frustrated by concurrent
action by the administrative body.

Fischback & Moore of Alaska, Inc. v. Lynn, 407 P.2d 174, 176 (Alaska
1965), overruled on other grounds by City & Borough of Juneau v.
Thibodeau, 595 P.2d 626, 629 n.6 (Alaska 1979).

¶9 The Commission’s actions in entertaining and granting
the withdrawal of Shelton’s wage claim interfered with the
court’s jurisdiction because the questions raised by Sunrise’s
petition had not been resolved. Furthermore, after taking assign-
ment of Shelton’s wage claim according to Utah Code section 34-
28-13 during judicial review, the Commission’s role as the
defendant rendered it powerless to simultaneously conduct
administrative determinations that would alter the final agency
action on review. In other words, the Commission could not
allow Shelton to withdraw her wage claim after Sunrise

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Baker v. Labor Commission

commenced judicial review, because the Commission no longer
had the capacity to act in its administrative adjudicatory
authority while judicial review proceedings were ongoing.

¶10 In sum, Shelton’s letter purporting to withdraw her wage
claim and revoke her assignment of the claim to the Commission
had no legal effect on Sunrise’s petition, because the
Commission did not have the jurisdiction to alter its final orders
once Sunrise instituted proceedings to review the Commission’s
orders in the district court. We therefore reverse the court’s
order and remand to the district court for further proceedings. 4

4. Because we reverse the district court’s order, we need not
reach the remaining issues raised in Sunrise’s appeal.

20140279-CA 6 2015 UT App 127