Allen v. Hoshijo

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
09-MAR-2021
08:03 AM
Dkt. 91 SO

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI#I

ALEXANDER ALLEN, Appellant-Appellant, v.
LEONARD HOSHIJO, AS ACTING DIRECTOR OF THE
DEPARTMENT OF LABOR AND INDUSTRIAL RELATIONS OF THE
STATE OF HAWAI#I; and ATLAS CONSTRUCTION, INC.,
Appellees-Appellees

APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CIVIL NO. 17-1-0916)

SUMMARY DISPOSITION ORDER
(By: Ginoza, Chief Judge, Leonard and Nakasone, JJ.)

Claimant-Appellant Alexander Allen (Allen) appeals from

the January 8, 2018 Final Judgment (Judgment) entered against him

and in favor of Employer-Appellee Atlas Construction, Inc.

(Atlas) and Respondent-Appellee Anne Perreira-Eustaquio1

(Director), as Director of the Department of Labor and Industrial

Relations (DLIR), in the Circuit Court of the First Circuit

1
Pursuant to Hawai#i Rules of Appellate Procedure Rule 43(c), Anne
Perreira-Eustaquio is substituted as a party herein.
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(Circuit Court).2 In the Judgment, the Circuit Court affirmed

the May 25, 2017 decision of the DLIR's Employment Security

Appeals Referees' Office [(ESARO)] Decision No. 1701177

(Decision). Allen also challenges the Circuit Court's January 8,

2018 Order Affirming [Decision], in which the Circuit Court

affirmed ESARO's finding that Allen is disqualified from

receiving unemployment compensation.

Allen raises six points of error on appeal, which we

construe as contending that: (1) the Decision was based on

Hawai#i Administrative Rule (HAR) § 12-5-47(b), which is invalid

because it exceeds the authority of Hawaii Revised Statutes (HRS)

Chapter 383; (2) the finding that Atlas did not communicate that

Allen was no longer employed by Atlas is grossly against the

weight of evidence; (3) an inference from equivocal evidence that

Allen intended to resign was unwarranted; (4) the Decision gives

"improper effect" to Allen's letter of resignation; (5) ESARO

imposed an incorrect burden of proof in reaching its Decision;

and (6) the Decision lacks the required conclusions of law, and

therefore it cannot be determined whether the law was correctly

applied.

Upon careful review of the record and the briefs

submitted by the parties, and having given due consideration to

2
The Honorable Keith K. Hiraoka presided.

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the arguments advanced and the issues raised by the parties, we

resolve Allen's points of error as follows:

(1) HRS § 383-30(1) (2015) outlines the circumstances

that disqualify an individual from receiving unemployment

benefits and provides, in relevant part:

§ 383-30 Disqualification for benefits. An
individual shall be disqualified for benefits:

(1) Voluntary separation. . . . For any week
beginning on and after October 1, 1989, in which
the individual has left the individual's work
voluntarily without good cause, and continuing
until the individual has, subsequent to the week
in which the voluntary separation occurred, been
paid wages in covered employment equal to not
less than five times the individual's weekly
benefit amount as determined under section
383–22(b).

(Emphasis added).

Implementing the provisions of HRS § 383–30(1), HAR

§ 12-5-47 provides, in relevant part:

§ 12-5-47 Voluntary separation. (a) An individual
shall be disqualified for benefits for voluntarily leaving
work without good cause.

(b) A separation is a voluntary leaving or quitting
when the facts and circumstances demonstrate that a claimant
is the "moving party" in the termination of an employment
relationship.

(c) Generally, a leaving of work is considered to be
for good cause where it is for a real, substantial, or
compelling reason, or a reason which would cause a
reasonable and prudent worker, genuinely and sincerely
desirous of maintaining employment, to take similar action.
Such a worker is expected to try reasonable alternatives
before terminating the employment relationship. [3]

(Emphasis added).

3
Allen does not argue that he voluntarily left work for good cause
pursuant to HAR § 12-5-47(c).

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Allen argues, in essence, that HAR § 12-5-47(b)

impermissibly changes the statutory criterion set forth in HRS

§ 383-30 for disqualification to receive unemployment

compensation benefits, and therefore, the Director exceeded the

statutory authority to adopt rules to carry out the duties and

responsibilities of administering HRS Chapter 383 when the

Director adopted HAR § 12-5-47(b). This argument is without

merit.

HRS § 383-92 (2015) provides, inter alia:

§ 383-92 Rules and regulations. The director of
labor and industrial relations may adopt, amend, or repeal
such rules and regulations as the director deems necessary
or suitable for the administration of this chapter. The
rules and regulations when prescribed in accordance with
chapter 91 shall have the force and effect of law and shall
be enforced in the same manner as this chapter.

As the Hawai#i Supreme Court has held:
[A]n administrative agency can only wield powers
expressly or implicitly granted to it by statute. However,
it is well established that an administrative agency's
authority includes those implied powers that are reasonably
necessary to carry out the powers expressly granted . The
reason for implied powers is that, as a practical matter,
the legislature cannot foresee all the problems incidental
to carrying out the duties and responsibilities of the
agency.

Haole v. State, 111 Hawai#i 144, 152, 140 P.3d 377, 385 (2006)

(quoting Morgan v. Planning Dep't Cty. of Kauai, 104 Hawai#i 173,

184, 86 P.3d 982, 993 (2004)).

As this court has previously recognized, HAR § 12-5-47

was adopted to implement and administer the statute, HRS § 383-

30. Ipsen v. Akiba, 80 Hawai#i 481, 486, 911 P.2d 116, 121 (App.

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1996); McElroy v. Pacific Lightnet, Inc., CAAP-XX-XXXXXXX, 2015

WL405679, *1 (Haw. App. Jan. 30, 2015) (SDO); see also Keanani v.

Akiba, 84 Hawai#i 407, 413, 935 P.2d 122, 128 (App. 1997)

(stating that HAR § 12-5-47(b) "further explains" HRS 383-30(1)).

Contrary to Allen's argument, HAR § 12-5-47 is in harmony with –

and is not inconsistent with – the statute, and provides further

clarity as to the narrow circumstances in which the statute

applies. Thus, the Circuit Court correctly determined the ESARO

did not err in applying the plain and unambiguous meaning of the

rule. See generally Int'l Bhd. of Elec. Workers, Local 1357 v.

Haw'n Tel. Co., 68 Haw. 316, 323-26, 713 P.2d 943, 950-52 (1986)

(an administrative rule need not parrot statutory language, as

long as the rule is not inconsistent with the statute).

Allen further argues that the term "moving party" is

"so vague that it allows the adjudicator to choose which party

prevails without any criteria." However, as this court

recognized in Ipsen, the plain and ordinary meaning of "moving

party" is comprehensible and clear:
"Moving" is the present participle of the verb "move." The
definitions of "move" include "to change position or
posture, to take action." Webster's Collegiate Dictionary
761 (10th ed. 1993). The word "move" from which "moving"
is derived "is very general and implies no more than the
fact of changing position." Id. The appeals officer found
that Appellant was the "moving party" in terminating her
employment.

Ipsen, 80 Hawai#i at 486, 911 P.2d at 121.

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Accordingly, we reject Allen's argument that HAR § 12-

5-47 is unconstitutionally vague.

(2, 3 & 4) Allen argues that ESARO's finding that he

was the moving party in the termination, and voluntarily quit his

employment with Altas, is grossly against the weight of evidence.

Allen further argues that an inference from "equivocal evidence"

was unwarranted, and the Decision gives an "improper effect" to

Allen's letter of resignation.
"An agency's findings are reviewable under the clearly
erroneous standard to determine if the agency decision was
clearly erroneous in view of reliable, probative, and
substantial evidence on the whole record." Poe v. Hawai #i
Labor Relations Bd., 87 Hawai#i 191, 195, 953 P.2d 569, 573
(1998) (citing Alvarez v. Liberty House, Inc., 85 Hawai #i
275, 277, 942 P.2d 539, 541 (1997); HRS § 91-14(g)(5)).
"'An agency's findings are not clearly erroneous and will be
upheld if supported by reliable, probative and substantial
evidence unless the reviewing court is left with a firm and
definite conviction that a mistake has been made.'" Poe v.
Hawai#i Labor Relations Bd., 105 Hawai#i 97, 100, 94 P.3d
652, 655 (2004) (quoting Kilauea Neighborhood Ass'n v. Land
Use Comm'n, 7 Haw. App. 227, 229-30, 751 P.2d 1031, 1034
(1988)).

Tauese v. State of Hawai#i, Dep't of Labor & Indus. Relations,

113 Hawai#i 1, 25, 147 P.3d 785, 809 (2006).

In Ipsen, this court held, inter alia, "in determining

whether Appellant 'voluntarily' quit, we are concerned with

whether the circumstances reflect an intent on the part of the

employee to terminate employment." 80 Hawai#i at 486, 911 P.2d

at 121 (footnote omitted). Here, on Friday, March 31, 2017, at

7:08 a.m., Allen emailed a letter of resignation to Bruce Kim

(Kim), President of Atlas:

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Bruce,

Please accept this email as formal notification that I am
resigning from my position with Atlas Construction. I
understand that two weeks notice is standard. However, we
can discuss a mutually beneficial date.

I would be glad to provide any assistance I can during this
transition.

Thank you for the opportunities for professional and
personal development that you have provided me during the
last three months.

I have enjoyed working for the company and feel I was making
large strides to understand the company’s culture and
philosophy. I believed I was starting to understand your
goals and commitment to quality.

However, I will not be treated disrespectfully or
unprofessionally because of some minor infractions or
misunderstandings.

You have been a huge conduit of support between the staff
and myself. But, when I called Rance this morning and
humbly asked for an apology, he defiantly refused.

I've worked extremely hard, often more than 50 hours/ week
trying to learn the processes, manage my job and complete my
administrative duties. I have also offered several
construction process recommendations to help improve the
quality of Atlas Homes. I did a lot of this on my own time
because of my general enthusiasm for continuous improvement.

I feel we had great potential, but I do not accept
disrespect in any shape or form.

Please, let me know how you would like to proceed.

Thereafter, there were various further text messages

from Allen to Kim, in which Allen suggested that there might be

alternatives to his leaving the company, conditioned on, among

other things, an apology. On Sunday, April 2, 2017, Kim

responded to Allen's communications, stating, in part: "I accept

[your] resignation request and I am open to a meeting on Monday

to see how I can help you transition out . . ." On Monday, April

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3, 2017, Allen turned in his keys and work shirts, along with

company credit cards and documents.

Based on the entirety of the evidence in the record in

this case, although there was some conflicting evidence, we

conclude the Circuit Court correctly determined that ESARO's

factual findings, including that Allen voluntarily quit his

employment, were supported by reliable, probative and substantial

evidence; we are not left with a firm and definite conviction

that a mistake has been made.

(5) Allen argues that ESARO imposed an incorrect

burden of proof. Allen submits that the phrase "[i]n this case,

claimant failed to meet his burden of proof" should be considered

in conjunction with ESARO's finding that there was insufficient

evidence that the employer intended to discharge Allen. However,

Allen takes this phrase out of context. The Decision states, in

part, after the determination that Allen voluntarily terminated

his employment with Atlas:
In a voluntary separation, the claimant bears the burden of
proof and must prove by a preponderance of evidence that he
had substantial and compelling good cause to terminate
employment. In this case, claimant failed to meet his
burden of proof. Claimant's reasons for quitting do not
meet the standard for good cause for leaving employment,
under Haw. Admin. R. § 12-5-47. Therefore, claimant
voluntarily left employment without good cause.

In sum, this passage in the Decision was germane to

ESARO's determination that Allen did not have good cause to

voluntarily quit his job. The Circuit Court correctly determined

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that ESARO did not err in stating that the moving party in the

termination assumes the burden of establishing good cause for

leaving work. See Hardin v. Akiba, 84 Hawai#i 305, 311, 983 P.2d

1339, 1345 (1997).

(6) Finally, Allen contends that the Decision should

be vacated or reversed because it did not separately state

conclusions of law.

HRS § 91-12 (2012)requires that an agency's decision be

accompanied by separate findings of fact and conclusions of law.

However, the statute does not require a separately labeled

"conclusions of law" section. "All that is required is that the

agency incorporate its findings and rulings in its decision," and

to "make its findings and rulings reasonably clear." Survivors

of Timothy Freitas, Dec. v. Pac. Contractors Co., 1 Haw. App. 77,

84, 613 P.2d 927, 932 (1980), (citing In re Terminal Transp.,

Inc., 54 Haw. 134, 139, 504 P.2d 1214, 1217 (1972)); see also In

re Haw. Elec. Light Co., 60 Haw. 625, 641-42, 594 P.2d 612, 624

(1970) (explaining that the purpose of this statutory requirement

is "to assure reasoned decision making by the agency and enable

judicial review of agency decisions") (citation omitted).

Here, the Decision makes clear the legal basis for

ESARO's ruling in its "Reasons for Decision," laying out both the

statutory language and quoting the administrative rule, as well

as applying those legal authorities to its factual
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determinations. Accordingly, we conclude that this point of

error is without merit.

For these reasons, we affirm the Circuit Court's

January 8, 2018 Judgment affirming ESARO's May 25, 2017 Decision.

DATED: Honolulu, Hawai#i, March 9, 2021.

On the briefs:
/s/ Lisa M. Ginoza
Charles S. Lotsof, Chief Judge
for Appellant-Appellant.
/s/ Katherine G. Leonard
Frances E.H. Lum, Associate Judge
Staci I. Teruya,
Deputy Attorneys General, /s/ Karen T. Nakasone
Department of the Attorney Associate Judge
General, State of Hawai#i,
Labor Division,
for Appellee-Appellee
LEONARD HOSHIJO, as Acting
Director of the Department of
Labor and Industrial Relations
of the State of Hawai#i.

Paul M. Saito,
John P. Duchemin,
(Cades Schutte LLLP)
for Appellee-Appellee
ATLAS CONSTRUCTION, INC.

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