Kerry A. Youngdale, Relator, vs. Sunbelt Sales & Leasing Inc., Respondent, Department of Employment and Economic Development, Respondent.

Kerry A. Youngdale, Relator, vs. Sunbelt Sales & Leasing Inc., Respondent, Department of Employment and Economic Development, Respondent. A06-775, Court of Appeals Unpublished, May 1, 2007.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2006).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A06-775

 

Kerry A. Youngdale,

Relator,

 

vs.

 

Sunbelt Sales & Leasing Inc.,

Respondent,

 

Department of Employment and Economic Development,

Respondent.

 

Filed May 1, 2007

Affirmed

Dietzen, Judge

 

Department of Employment and Economic Development

Agency File No. 18171 05

 

Thomas H. Boyd, Winthrop & Weinstine, P.A., 225 South Sixth Street, Suite 3500, Minneapolis, MN 55402 (for relator)

 

Lee B. Nelson, Linda A. Holmes, Department of Employment and Economic Development, 332 Minnesota Street, Suite E200, St. Paul, MN 55101-1351 (for respondent Department of Employment and Economic Development)

 

Sunbelt Sales & Leasing, Inc., 7528 East Point Douglas Road South, Cottage Grove, MN 55016 (respondent)

 

            Considered and decided by Dietzen, Presiding Judge; Randall, Judge; and Hudson, Judge.

U N P U B L I S H E D   O P I N I O N

 

DIETZEN, Judge

 

            In this certiorari proceeding, relator challenges the decision of the unemployment law judge (ULJ) that he was discharged for employment misconduct and, therefore, was disqualified from receiving benefits, arguing that his activities did not constitute employment misconduct.  Because the ULJ's decision was supported by substantial evidence in the record as a whole, we affirm.

FACTS

            Relator Kerry Youngdale was employed by Sunbelt Sales and Leasing, Inc. (Sunbelt), an auto and truck sales and service business, as its general manager for about ten months.  After his termination from Sunbelt in October 2005, Youngdale sought unemployment benefits.  The Department of Employment and Economic Development (DEED) determined that Youngdale was disqualified from receiving unemployment benefits on the ground of employment misconduct, and Youngdale appealed.  

            At the hearing, Judd Beattie, Sunbelt's president, testified that Youngdale was discharged for misconduct resulting from three specific incidents.  First, Youngdale issued and signed a check on Sunbelt's checking account for $20 to a vendor for a special-order part for a customer, even though he was not authorized to do so.  Youngdale did not request or receive authorization to sign the check.  When Beattie discovered the unauthorized check, he reprimanded Youngdale.

            Second, Youngdale ordered a credit report on himself from Sunbelt's credit bureau without receiving authorization from Sunbelt.  By doing so, Youngdale violated the agreement between Sunbelt and its credit bureau and potentially violated federal law.  Beattie reprimanded Youngdale.

            Third, Youngdale, who "had considerable experience in the automobile sales business," traded in a car as part of his purchase of another vehicle from Sunbelt.  Although Youngdale disclosed that the car was subject to a loan, he failed to disclose that both the loan and title to the car were not in his name, but were in his parents' names.  When Sunbelt attempted to sell the car to a customer, it discovered that Youngdale did not have legal title.  At the time of the trade-in, Youngdale's mother was deceased, and his father was in a nursing home in another state.  Youngdale acknowledged the problem and agreed to clear the title to the car and pay the loan.  The matter was not resolved at the time of the hearing.

            Following the hearing, the ULJ concluded that Youngdale was discharged because of employment misconduct and, therefore, was disqualified from receiving benefits.  The ULJ reasoned that the check-signing and credit-report incidents violated the reasonable expectations of his employer but did not constitute serious violations.  But the ULJ also concluded that "[h]is failure to disclose that he did not have legal title to the car he was trading in at the time of the transaction was a material omission" that "potentially subjected Sunbelt to serious legal liability and jeopardized its relationship with the bank which had made the loan to the customer who subsequently purchased the car."  Further, the ULJ concluded that Youngdale's assertion that it was an "oversight" was not credible.  Youngdale filed a request for reconsideration of the ULJ's decision, and the ULJ issued an order affirming the decision.  This certiorari appeal followed.

D E C I S I O N

I.

Youngdale argues that the ULJ erred in concluding that his activities constituted employment misconduct.  On certiorari appeal this court may reverse or modify the ULJ's decision if the relator's substantial rights "may have been prejudiced" by "error of law" or "unsupported by substantial evidence in view of the entire record as submitted."  Minn. Stat. § 268.105, subd. 7(d) (Supp. 2005) (establishing the standard of review for ULJ decisions issued after July 2005).

Whether an employee committed misconduct is a mixed question of fact and law.  Schmidgall v. FilmTec Corp., 644 N.W.2d 801, 804 (Minn. 2002).  "Whether the employee committed a particular act is a question of fact."  Skarhus v. Davanni's Inc., 721 N.W.2d 340, 344 (Minn. App. 2006).  We review findings of fact in the light most favorable to the ULJ's decision, and we give deference to the ULJ's credibility determinations.  Id. This court will not disturb the ULJ's factual findings when they are supported by substantial evidence. Id.; Minn. Stat. § 268.105, subd. 7(d)(5).  But whether the employee's act constitutes disqualifying misconduct is a question of law, which this court reviews de novo.  Schmidgall, 644 N.W.2d at 804.

An employee who is discharged for misconduct is disqualified from receiving unemployment benefits.  Minn. Stat. § 268.095, subd. 4(1) (Supp. 2005).  Under the statute, "employment misconduct" means:

[A]ny intentional, negligent, or indifferent conduct, on the job or off the job (1) that displays clearly a serious violation of the standards of behavior the employer has the right to reasonably expect of the employee, or (2) that displays clearly a substantial lack of concern for the employment.

 

Inefficiency, inadvertence, simple unsatisfactory conduct, a single incident that does not have a significant adverse impact on the employer, conduct an average reasonable employee would have engaged in under the circumstances, poor performance because of inability or incapacity, good faith errors in judgment if judgment was required, or absence because of illness or injury with proper notice to the employer, are not employment misconduct.

 

Minn. Stat. § 268.095, subd. 6(a) (2004).  Thus, a knowing violation of an employer's directives, policies, or procedures constitutes employment misconduct because it demonstrates a substantial lack of concern for the employer's interests.  Schmidgall, 644 N.W.2d at 804.  "A single incident where an employee deliberately chooses a course of action adverse to the employer can constitute misconduct."  Ress v. Abbott Nw. Hosp., Inc., 448 N.W.2d 519, 524 (Minn. 1989). 

Here, the ULJ rested the determination of employee misconduct on relator's conduct involving the trade-in of the car.  Youngdale argues that his actions involving the trade-in were "outside the terms of his employment" and did not occur in connection with the performance of his employment duties.  Youngdale relies on Forester v. Value Travel, Inc., 506 N.W.2d 667, 669 (Minn. App. 1993), and Hein v. Gresen Div., 552 N.W.2d 41, 44 (Minn. App. 1996), to argue that the actions must be "in connection with the performance of his employment" or must "interfere with or adversely affect" his remployment to constitute disqualifying misconduct.  But these decisions are based on statutory language that the legislature has removed from the statute.  See Forester, 506 N.W.2d at 669 (applying the requirement in Minn. Stat. § 268.09, subd. 1(b) (1992) that misconduct be "‘connected with work' or must ‘interfere[ ] with and adversely affect[ ] employment'"); Hein,552 N.W.2d at 43 (applying same language from 1994 version).  The applicable statute, which was in effect at the time of relator's termination, provides that misconduct may occur "on the job or off the job" if it "displays clearly a serious violation of the standards of behavior the employer has the right to reasonably expect of the employee" or "displays clearly a substantial lack of concern for the employment."  Minn. Stat. § 268.095, subd. 6(a) (2004). 

Here, the ULJ found that the failure to disclose the title problem was a "material omission," and that Sunbelt "had a right to reasonably expect that Youngdale would be honest and forthcoming in conducting all business transactions on behalf of and with Sunbelt, especially given his position as general manager."  (Emphasis added.).

The record supports the ULJ's finding.  Youngdale's off-the-job conduct violated the standards of behavior that Sunbelt had the right to reasonably expect from its general manager.  An attempt by a general manager of a car dealership to trade-in a car without title displays a substantial lack of concern for the employment and for the rules that govern the sale of cars.  As the general manager, Youngdale should have known that his employer would be jeopardized by receiving a car for which it that did not have title. 

Youngdale also argues that his failure to disclose the title information was an "oversight," and that he had no motive for knowingly failing to disclose the information.  Here, the ULJ rejected relator's argument, finding that Youngdale is experienced in selling cars, and that Youngdale knew that title was in his parents' name and needed to be transferred. We defer to the ULJ on credibility issues.  Ywswf v. Teleplan Wireless Services, Inc., 726 N.W.2d 525, 531 (Minn. App. 2007).  The record as a whole supports the ULJ's finding. 

Likewise, the ULJ's finding of adverse impact to the employer is supported by the record.  Sunbelt's president testified that a title problem placed the company in jeopardy with its lending partners.  Although Sunbelt was able to prevent the worst possible consequences, the risk of such consequences and the efforts expended to prevent them constitute an adverse impact on the employer.     

II.

Youngdale challenges the ULJ's finding that the three events constitute a pattern of misconduct, arguing that the three incidents are unrelated and, therefore, cannot constitute a "pattern of conduct."  Because Youngdale's misconduct regarding the trade-in of the car is sufficient to support his ineligibility for unemployment benefits, it is not necessary for us to reach this issue, and, therefore, we decline to do so. 

            Affirmed.