HANS F. SCHMID v. BOARD OF REVIEW and VERNON COMPANY

(NOTE: The status of this decision is .)
 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-4247-07T24247-07T2

HANS F. SCHMID,

Appellant,

v.

BOARD OF REVIEW and

VERNON COMPANY,

Respondents.

______________________________

 

Submitted May 6, 2009 - Decided

Before Judges Lihotz and Messano.

On appeal from the Board of Review, Department of Labor, Docket No. 147,915.

Hans F. Schmid, appellant pro se.

Anne Milgram, Attorney General, attorney for respondents (Lewis A. Scheindlin, Assistant Attorney General, of counsel; Ellen A. Reichart, Deputy Attorney General, on the brief).

PER CURIAM

Claimant, Hans F. Schmid, appeals from a final determination of the Board of Review (Board), which affirmed an appeal tribunal's denial of unemployment benefits in accordance with N.J.S.A. 43:21-5(b) and, also required he refund benefits erroneously paid, pursuant to N.J.S.A. 43:21-16(d)(1). The Board determined Schmid's request for benefits for the period February 25, 2007 through April 7, 2007, was properly denied, as Schmid was terminated for misconduct. In light of our deferential standard of review, we find the Board's decision was properly premised upon facts in the record and is in accord with relevant statutory provisions.

The facts are as follows. In 2001, Vernon Company (Vernon) purchased Mar-Kal Products Corporation, a company owned by Schmid's family. In conjunction with the transaction, Vernon hired Schmid as a sales representative, pursuant to the terms of an employment agreement. The contract included a non-compete clause, which precluded Schmid from contacting Vernon's clients outside the scope of his specified professional sales role and precluded him from accepting employment from any other company while he worked for Vernon.

Nancy Matusi, Schmid's wife, owned Decal Information Systems (DIS), Vernon's customer. Schmid was not responsible for servicing DIS's account. In January 2007, Joseph Pugel, a Vernon senior vice president, discovered Schmid e-mailed a potential Vernon customer seeking decal manufacturing work as DIS's "Regional Sales Engineer." Pugel also learned Schmid had contacted other Vernon customers on behalf of DIS. New Jersey Department of Labor reports for the first quarter of 2007 revealed DIS paid Schmid $200.

On February 2, 2007, Pugel offered Schmid a termination package conditioned on Schmid's execution of another non-compete agreement. Pugel gave Schmid thirty days to consider the proposal, during which time he was not to solicit Vernon's clients. Schmid refused to execute the agreement and continued his sales efforts on behalf of DIS. On March 5, 2007, Schmid was discharged for misconduct.

Schmid's request for unemployment benefits was denied by the deputy claims examiner, who found Schmid was disqualified from receiving benefits. An appeals tribunal reversed that determination. Vernon appealed to the Board, which remanded the matter to an appeals tribunal for a rehearing.

During the rehearing, Schmid argued his contacts with DIS and the other companies were undertaken in the course of his work at Vernon and the DIS wage report on file with the State was in error. Schmid's accountant, Edward Goldman, who was also DIS's accountant, testified Schmid never received payment from DIS and had "no idea" why the Department of Labor would show wages paid by DIS to Schmid. Also, Schmid contended Pugel discharged him because of his advanced age of seventy-five and because his sales were dropping, not for misconduct.

In its August 9, 2007 decision, the appeals tribunal credited Pugel's testimony and denied Schmid's request for benefits finding he was discharged for misconduct at work. The appeals tribunal also notified Schmid of his obligation to refund benefits received during the period of disqualification, pursuant to N.J.S.A. 43:21-16(d)(1). Schmid appealed. On February 21, 2008, the Board affirmed the Tribunal's determination. This appeal ensued.

The limited nature of our review of administrative decisions is well established. Brady v. Bd. of Review, 152 N.J. 197, 210 (1997). In analyzing the Board's determination, we remain mindful that "[t]he grant of authority to an administrative agency is to be liberally construed to enable the agency to accomplish the Legislature's goals." Gloucester County Welfare Bd. v. N.J. Civil Serv. Comm'n, 93 N.J. 384, 390 (1983).

In our review, we will not disturb an agency's determination unless it is arbitrary, capricious, or unreasonable, or unsupported by credible evidence in the record as a whole. Karins v. City of Atlantic City, 152 N.J. 532, 540 (1998); Brady, supra, 152 N.J. at 210. A claimant has a heavy burden of proof when challenging the Board's decision, as the agency's determination carries with it a strong presumption of reasonableness. Gloucester County Welfare Bd., supra, 93 N.J. at 390. We are also obliged to defer to an agency's determinations of credibility, as the agency has had the opportunity to hear the witnesses and fully consider the evidence. Doering v. Bd. of Review, 203 N.J. Super. 241, 245 (App. Div. 1985).

Once a person has been determined disqualified from receiving unemployment benefits, the statue requires repayment of any benefits received. N.J.S.A. 43:21-16(d)(1). Full recoupment of "unemployment benefits received by an individual who, for any reason, regardless of good faith, was not actually entitled to those benefits" is mandated as "[t]he public interest clearly is not served when the Unemployment Trust Fund is depleted by the failure to recoup benefits erroneously paid to an unentitled recipient, however blameless he or she may have been." Bannan v. Bd. of Review, 299 N.J. Super. 671, 674 (App. Div. 1997).

Here, Schmid was terminated for misconduct. New Jersey's unemployment compensation law states an individual shall be disqualified for unemployment compensation for the week in which the employee has been suspended for "misconduct" and for a period of five weeks immediately following the suspension. N.J.S.A. 43:21-5(b). Though not defined in the statute, it is well established that misconduct means willful, deliberate and intentional actions of the employee, which violate an employer's rules, standards, or interests. See Parks v. Bd. of Review, 405 N.J. Super. 252, 254 (App. Div. 2009) (misconduct "must be an act of wanton or willful disregard of the employer's interest, a deliberate violation of the employer's rules, [or] a disregard of standards of behavior which the employer has the right to expect of his employee"); Demech v. Bd. of Review, 167 N.J. Super. 35, 38 (App. Div. 1979); Beaunit Mills v. Div. of Emp. Sec., 43 N.J. Super. 172, 183 (App. Div. 1956), certif. denied 23 N.J. 579 (1957).

The Board adopted the Tribunal's findings, including its credibility determinations. Following our review, we conclude the Board's decision was not arbitrary, capricious, or unreasonable and is supported by the record. Documentary evidence supported Vernon's claim that Schmid solicited Vernon's clients on behalf of his wife's company and also received wages from DIS. Schmid was specifically told to cease such unauthorized actions, a warning he disregarded. Vernon's expectation its employee would abide by the contractual non-compete clause was reasonable, and Schmid's willful disregard evinces a willful violation of the terms of his employment, justifying termination. Moreover, Schmid's general denial in the face of the State's wage records and other documents was found unpersuasive.

Thus, we conclude Schmid's arguments are unavailing. He offers no basis to alter the Board's considered determination. Karins, supra, 152 N.J. at 540.

 
Affirmed.

Following Schmid's discharge from Vernon, Janet Kaplan, Schmid's mother, acquired ownership of DIS.

(continued)

(continued)

7

A-4247-07T2

June 15, 2009