STATE OF MAINE PENOBSCOT, SS. SUPERIOR COURT CIVIL ACTION Docket No. AP-04-20 [I__--__-.---.- FlLED8ENTERED - SUPEff /OR COURT
Fern M. Dowling, Plaintiff 1 pl"f3SCOT COUNTY 1 v. SEP 1 4 Wo3 Post-Remand Order on Appeal
Bangor Housing Authority, Defendant .- 1 1
Pursuant to the court's order dated March 28,2005, the Bangor Housing Authority (BHA) hearing officer has issued further findings of fact and conclusions of law relating to his decision to terminate plaintiff Fern M. Dowling's eligibility for a rental-housing subsidy. The court has considered the supplemented record on appeal and the submissions of the parties generated by the hearing officer's order on remand. Dowling's post-remand argument reiterates a number of contentions that the court rejected in its initial order, and the court does not repeat that discussion here. The background of this case is set out in the court's March order. That order sets out the hearing officer's findings that he articulated in his first order and that the court has already found are supported by the record. In his post-remand decision, the hearing officer articulated the following additional findings. The lease between the lessor (Robert Wortman) and Dowling included the cost of utilities. As the hearing officer also found in his first written decision, Dowling requested this arrangement because it would allow her to move into a different residential unit that she preferred. In June 2003, BHA provided Dowling with a document (which she signed) advising her, in a section entitled "Penalties for Committing Fraud," that she could be evicted from her subsidized residence if her "application or recertification form contains false or incomplete information. . . ." See R. 13. The same document also identified payments for expenses not covered by the lease as a form of fraud, and, in a fraud-related section of the document, it instructed the lessee to obtain a written explanation for mandatory payments other than rent. Id. Dowling knew that, to qualify under the subsidy, the lease was required to include utilities, and she was aware that her side agreement with Wortman was not lawful. On the basis of these factual findings that supplemented those set out in his first written order, the hearing officer concluded that Dowling did not disclose information that she was required to produce to BHA, that her side agreement with Wortman was unlawful, that she knew that the side agreement was unlawful, and that it was fraudulent. The hearing officer then explained that BHA was authorized to terminate Dowling's eligibility for rent subsidy because she did not comply with her disclosure obligations under the program and, alternatively, because she engaged in fraudulent conduct. The hearing officer also noted that although Wortman was a culpable participant in the arrangement that resulted in extra rent payments to him, Dowling's own role did not justify a mitigated disposition, because she chose not to report the arrangement to BHA and because she profited from the arrangement. In this post-remand proceeding, Dowling challenges the sufficiency of the evidentiary basis for :he hearing officer's further factual findings. This court reviews the administrative decision for errors of law, abuse of discretion and factual findings unsupported by substantial evidence in the record. Hale-Rice v. Maine State Retirement System, 691 A.2d 1232, 1235 (Me. 1997). The court here is satisfied that the hearing officer was entitled to reach the factual findings he has now set out in the two orders.' Title 2 4 C.F.R. $ 982.551(b)(4) obligates a family receiving rent subsidy to provide the housing authority with information that is "true and complete." The hearing officer concluded that Dowling's failure to disclose her side agreement with Wortman violated this provision. This conclusion is not erroneous. Dowling was made aware of
1 In its first order, the court noted that the record did not support an administrative finding that subsidy applicants are advised that side agreements for payments of extra money to the lessor are a form of fraud. See March 28,2005, Order at 2, n.2. In his post-remand order, however, the hearing officer has pointed to evidence that in fact supports such a factual finding. See R. 13-14 (document entitled 'Things You Should Know"). This finding, which the hearing officer reiterates in his post-remand decision, therefore has evidentiary support. Beyond this, in the text of the March 28 order, the court has identified those findings that enjoy support in the record. In combination with the findings set out in the hearing officer's second decision, these are the findings that are warranted by the record. her responsibilities regarding the terms of her lease agreement with the lessor and, in particular, of the materiality of limitations on the financial terms of that agreement. Based on the hearing officer's findings that she willfully violated those limitations and knowingly failed to disclose these terms to BHA, he was entitled to conclude that Dowling materially violated the terms of her subsidy eligibility and was subject to disqualification for that benefit. See 24 C.F.R. § 982.552(c)(i). Independent of that analysis, the hearing officer also concluded that Dowling's conduct amounted to fraud and that her subsidy should be terminated. Neither aspect of this conclusion is erroneous. In support of this argument that the hearing officer's conclusion that she had engaged in fraud, Dowling relies in part on "The HUD Voucher Program Guidebook: Housing Choice." In her brief on appeal, Dowling describes this as HUD's interpretation and discussion of its regulations. This material is not part of the evidentiary record. Further, even if Maine courts may judicially notice federal administrative regulations, this interpretive material is of a different evidentiary quality and is not subject to judicial notice. Dowling argues that a court may consider and even give deference to an ageccy's interpretation. This is sometimes true when the agency that issued a decision subsequently appealed relied on its own construction of rules that it administers. See, e.g., Wright v. Town of Kennebunkport, 1998 M E 184,g 5, 715 A.2d 162, 164. Here, however, Dowling seeks to impose on BHA's decision HUD's interpretation of HUD regulations. Thus, reliance on the HUD material is not proper under the appellate analysis urged her by Dowling, because Dowling resorts to extrinsic information that does not constitute BHA's own internal analysis. Thus, the court does not consider the information in the "g~idebook."~
2 In any event, the court notes that the passages quoted by Dowling tend to undermine her contention that her conduct as established by the hearing officer did not rise to the level of fraud, for purposes of the rent subsidy eligibility. The "guidebook characterizes "fraud" as the omission or concealment of substantive facts, done with the intent to deceive or mislead. The "guidebook" goes on to describe fraud as the intentional failure to report information that is subject to mandatory disclosure, when the purpose for that non-disclosure is to achieve benefits to which the party is not entitled. This is the substance of Dowling's conduct as determined by the hearing officer.
Free access — add to your briefcase to read the full text and ask questions with AI
STATE OF MAINE PENOBSCOT, SS. SUPERIOR COURT CIVIL ACTION Docket No. AP-04-20 [I__--__-.---.- FlLED8ENTERED - SUPEff /OR COURT
Fern M. Dowling, Plaintiff 1 pl"f3SCOT COUNTY 1 v. SEP 1 4 Wo3 Post-Remand Order on Appeal
Bangor Housing Authority, Defendant .- 1 1
Pursuant to the court's order dated March 28,2005, the Bangor Housing Authority (BHA) hearing officer has issued further findings of fact and conclusions of law relating to his decision to terminate plaintiff Fern M. Dowling's eligibility for a rental-housing subsidy. The court has considered the supplemented record on appeal and the submissions of the parties generated by the hearing officer's order on remand. Dowling's post-remand argument reiterates a number of contentions that the court rejected in its initial order, and the court does not repeat that discussion here. The background of this case is set out in the court's March order. That order sets out the hearing officer's findings that he articulated in his first order and that the court has already found are supported by the record. In his post-remand decision, the hearing officer articulated the following additional findings. The lease between the lessor (Robert Wortman) and Dowling included the cost of utilities. As the hearing officer also found in his first written decision, Dowling requested this arrangement because it would allow her to move into a different residential unit that she preferred. In June 2003, BHA provided Dowling with a document (which she signed) advising her, in a section entitled "Penalties for Committing Fraud," that she could be evicted from her subsidized residence if her "application or recertification form contains false or incomplete information. . . ." See R. 13. The same document also identified payments for expenses not covered by the lease as a form of fraud, and, in a fraud-related section of the document, it instructed the lessee to obtain a written explanation for mandatory payments other than rent. Id. Dowling knew that, to qualify under the subsidy, the lease was required to include utilities, and she was aware that her side agreement with Wortman was not lawful. On the basis of these factual findings that supplemented those set out in his first written order, the hearing officer concluded that Dowling did not disclose information that she was required to produce to BHA, that her side agreement with Wortman was unlawful, that she knew that the side agreement was unlawful, and that it was fraudulent. The hearing officer then explained that BHA was authorized to terminate Dowling's eligibility for rent subsidy because she did not comply with her disclosure obligations under the program and, alternatively, because she engaged in fraudulent conduct. The hearing officer also noted that although Wortman was a culpable participant in the arrangement that resulted in extra rent payments to him, Dowling's own role did not justify a mitigated disposition, because she chose not to report the arrangement to BHA and because she profited from the arrangement. In this post-remand proceeding, Dowling challenges the sufficiency of the evidentiary basis for :he hearing officer's further factual findings. This court reviews the administrative decision for errors of law, abuse of discretion and factual findings unsupported by substantial evidence in the record. Hale-Rice v. Maine State Retirement System, 691 A.2d 1232, 1235 (Me. 1997). The court here is satisfied that the hearing officer was entitled to reach the factual findings he has now set out in the two orders.' Title 2 4 C.F.R. $ 982.551(b)(4) obligates a family receiving rent subsidy to provide the housing authority with information that is "true and complete." The hearing officer concluded that Dowling's failure to disclose her side agreement with Wortman violated this provision. This conclusion is not erroneous. Dowling was made aware of
1 In its first order, the court noted that the record did not support an administrative finding that subsidy applicants are advised that side agreements for payments of extra money to the lessor are a form of fraud. See March 28,2005, Order at 2, n.2. In his post-remand order, however, the hearing officer has pointed to evidence that in fact supports such a factual finding. See R. 13-14 (document entitled 'Things You Should Know"). This finding, which the hearing officer reiterates in his post-remand decision, therefore has evidentiary support. Beyond this, in the text of the March 28 order, the court has identified those findings that enjoy support in the record. In combination with the findings set out in the hearing officer's second decision, these are the findings that are warranted by the record. her responsibilities regarding the terms of her lease agreement with the lessor and, in particular, of the materiality of limitations on the financial terms of that agreement. Based on the hearing officer's findings that she willfully violated those limitations and knowingly failed to disclose these terms to BHA, he was entitled to conclude that Dowling materially violated the terms of her subsidy eligibility and was subject to disqualification for that benefit. See 24 C.F.R. § 982.552(c)(i). Independent of that analysis, the hearing officer also concluded that Dowling's conduct amounted to fraud and that her subsidy should be terminated. Neither aspect of this conclusion is erroneous. In support of this argument that the hearing officer's conclusion that she had engaged in fraud, Dowling relies in part on "The HUD Voucher Program Guidebook: Housing Choice." In her brief on appeal, Dowling describes this as HUD's interpretation and discussion of its regulations. This material is not part of the evidentiary record. Further, even if Maine courts may judicially notice federal administrative regulations, this interpretive material is of a different evidentiary quality and is not subject to judicial notice. Dowling argues that a court may consider and even give deference to an ageccy's interpretation. This is sometimes true when the agency that issued a decision subsequently appealed relied on its own construction of rules that it administers. See, e.g., Wright v. Town of Kennebunkport, 1998 M E 184,g 5, 715 A.2d 162, 164. Here, however, Dowling seeks to impose on BHA's decision HUD's interpretation of HUD regulations. Thus, reliance on the HUD material is not proper under the appellate analysis urged her by Dowling, because Dowling resorts to extrinsic information that does not constitute BHA's own internal analysis. Thus, the court does not consider the information in the "g~idebook."~
2 In any event, the court notes that the passages quoted by Dowling tend to undermine her contention that her conduct as established by the hearing officer did not rise to the level of fraud, for purposes of the rent subsidy eligibility. The "guidebook characterizes "fraud" as the omission or concealment of substantive facts, done with the intent to deceive or mislead. The "guidebook" goes on to describe fraud as the intentional failure to report information that is subject to mandatory disclosure, when the purpose for that non-disclosure is to achieve benefits to which the party is not entitled. This is the substance of Dowling's conduct as determined by the hearing officer. Further, although the passages from the HUD material cited by Dowling focus on a lessor's responsibility for side agreements and the consequences to which those side agreements expose the lessor, that material is not helpful in determining the effects of Dowling's conduct on her As is noted above, the evidence presented to the hearing officer - in particular, the provisions of the informational document entitled "Things You Should Know," -- classifies the type of conduct in which Dowling engaged as fraudulent. Further, that conduct as established by the hearing officer easily fits within more conventional notions of fraud. See Francis v. Stinson, 2000 ME 173,g 38,760 A.2d 209, 217 (fraud is committed with the actor "(1) makes a false representation (2) of a material fact (3) with knowledge of its falsity or in reckless disregard of whether it is true or false (4) for the purpose of inducing another to act or to refrain from acting in reliance upon it, and (5) the plaintiff justifiably relies upon the representation as true and acts upon it to her detriment."). The commission of fraudulent conduct is an adequate basis for terminating rental assistance. See 24 C.F.R. $ 982.552(c)(iv). The hearing officer was therefore entitled to conclude that Dowling's conduct was fraudulent and was a basis for disqualification from the rent subsidy. As applied here, the reasoning in cases such as Crutchley v. Costa, 2002 N.Y.Misc. LEXIS 161 (Dist.Ct.N.Y., February 13,2002), is not persuasive. Crutchley involved a direct action by the lesszlr against a fame; tenant, in which the fzrrner sought an order of eviction and recovery of rent arrearages for a period of time after a section 8 subsidized lease had expired. The question at bar is whether Dowling's conduct disqualified her from entitlement to ongoing subsidy benefits. The Crutchley analysis is inapposite.
The entry shall be: For the foregoing reasons, the decision of the Bangor Housing Authority is affirmed.
continuing eligibility for rent subsidy. In contrast to other cases where a tenant is truly victimized by a lessor who is the sole beneficiary of a side agreement for extra rent, the salient point here is that, as the hearing officer found, Dowling herself instigated the arrangement where she made payments outside of the authorized lease terms, and she did so for her own benefit. Dowling's attempt to cast herself as Wortman's victim (and, even more notably, a victim of BHA because of its decision to terminate her benefits) is undermined by the hearing officer's finding regarding the nature of and reasons for her participation in the unlawful arrangement with her landlord. Dated: August 18, 2005 Date Filed 8/23/04 PENOBSCOT Docket No.-AP-2004-20 County
Action CIVIL - RULE 80B APPEAL ASSIGNED TO JUSTICE J E F m L. HJELM
FERN DOWLING VS. BANGOR HOUSING AUTHORITY
Plaintiff's Attorney Defendant's Attorney Pine Tree Legal Assistance GROSS, MINSKY & MOGUL, P.A. 61 Main St P. 0. BOX 917 Bangor ME 04401 BANGOR, ME. 04402-09 17 BY: Carl Kandutsch, Esq. BY: EDWARD W. GOULD, ESQ.
Date of Entry
1 8/23/04 ( Petition for Review of Administrative Action filed by Plaintiff. Motion for Stay of Administrative Action filed by Plaintiff with proposed Order. Affidavit in Support for Motion for Stay of Administrative Action filed by Plaintiff.
I 8123104 I Application of Plaintiff to Proceed without Payment of Fees filed by Plaintiff. Order filed. The court has reviewed the proposed pleadings. It appears that the applicant is proceeding in good faith and is without sufficient funds to pay certain fees or costs. It is ORDERED that: the filing fee is waived. This order is incorporated into the docket by reference at the specific direction of the court. (Mead, J.) Copy forwarded to Plaintiff's Attorney .
Notice and Briefing Schedule 80B Appeal of Governmental Actions filed. Copy forwarded to Plaintiff's Attorney.
Entry of Appearance filed by Edward W. Gould, Esq., on behalf of Defendant Bangor Housing Authority. (Copy of Notice and Briefing Schedule forwarded t o Attorney Gould this date.)
Acceptance of Service of Complaint as to Deft. Bangor Housing Authority by Edward Gould, Esq. (undated)
1 9129104 Plaintiff's Brief filed with attachments.
Index to Record with Record filed by Plaintiff.