NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NOS. A-1421-24 A-1425-24
SHAWN P. FLANNERY,
Appellant,
v.
BOARD OF REVIEW, DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT and SOUTH STATE, INC.,
Respondents. ___________________________
Submitted May 5, 2026 – Decided May 20, 2026
Before Judges Perez Friscia and Vinci.
On appeal from the Board of Review, Division of Unemployment Insurance, Department of Labor and Workforce Development, Docket Nos. 317256 and 317257.
O'Brien Belland & Bushinsky, LLC, attorneys for appellant (David H. Lipow, on the briefs). Jennifer Davenport, Attorney General, attorney for respondent Board of Review (Janet Greenberg Cohen, Assistant Attorney General, of counsel; Christopher J. Chiacchio, Deputy Attorney General, on the briefs).
Testa Heck Testa & White, PA, attorneys for respondent South State, Inc. (Todd W. Heck, on the briefs).
PER CURIAM
In these related appeals, which we consolidated for the purpose of issuing
a single opinion, claimant Shawn P. Flannery appeals from two December 4,
2024 final decisions of the Board of Review (Board) finding him liable for non-
fraud refunds of unemployment benefits. For the reasons that follow, we vacate
and remand for the Board to make additional findings and explain the basis for
its determination of the amount of the overpayments, if any, Flannery is liable
to refund. On remand, the Board shall also address Flannery's claim that he is
entitled to a waiver of recovery of an overpayment of benefits pursuant to
N.J.A.C. 12:17-14.2(a) and N.J.S.A. 43:21-16(d)(3)-(5).
I.
We summarize the facts developed during the three-day telephonic
hearing before the Appeal Tribunal. Flannery testified that he is a laborer who
was temporarily laid off by his employer, South State, Inc. (South State), for
approximately fifteen weeks between November 2020 and April 2022.
A-1421-24 2 On March 15, 2020, Flannery initiated a claim with the Division of
Unemployment and Temporary Disability Insurance (Division) for
unemployment benefits (Claim I). Prior to November 2020, he applied for and
received unemployment benefits during calendar year 2020 for the week ending
August 15, 2020. He was thereafter employed by South State from
approximately August 16, 2020, until November 22, 2020.
Before November 2020, Flannery certified his eligibility for
unemployment benefits electronically using the internet. On November 28,
2020, Flannery attempted to certify his eligibility for unemployment benefits
but was unable to use the internet reporting system. Instead, he certified that he
was eligible for benefits using the Division's telephonic reporting system.
When he attempted to certify his eligibility for benefits for the week
ending November 28, 2020, the telephonic system directed him to certify his
eligibility for the week ending August 22, 2020, because his last claim for
benefits was for the week ending August 15, 2020. Flannery attempted to
correct the error but was unable to do so. As a result, he was paid unemployment
benefits for the week ending November 28, 2020, but the Division's records
incorrectly indicated the benefits were paid for the week ending August 22,
2020, when he was employed.
A-1421-24 3 This same error was repeated when he used the telephonic reporting
system to certify his eligibility for benefits for the weeks ending December 5,
12, 19, and 26, 2020, and January 2 and 9, 2021. The Division's records
incorrectly reflected that those claims for benefits were paid for the weeks
ending August 29, September 5, 12, 19, and 26, and October 3, 2020. It is
undisputed Flannery was employed during those periods.
Flannery was unemployed again from August 15 through September 11,
2021. On August 21, 2021, he used the telephonic reporting system to certify
his eligibility for benefits for the week ending August 21, 2021. Once again,
the system defaulted to October 3, 2020, and those benefits were incorrectly
paid as benefits for the week ending October 3, 2020, when Flannery was
employed.1 The same error was repeated when Flannery certified his eligibility
for benefits for the weeks ending August 28, and September 4, and 11, 2021.
Those benefits were incorrectly paid as benefits for the weeks ending October
10, 17, and 24, 2020, when Flannery was employed.
Flannery was unemployed from December 26, 2021, through January 1,
2022. On January 1, 2022, he used the telephonic system to certify his eligibility
1 It is not clear in the record why this was recorded as the week ending October 3, 2020, rather than October 10, 2020. That contradiction should be resolved, if possible, on remand. A-1421-24 4 for benefits for the week ending January 1, 2022. Those benefits were paid for
the week ending October 31, 2020, when Flannery was employed.
All the unemployment benefits Flannery received for the period
November 28, 2020, through January 1, 2022, were incorrectly paid by the
Division as unemployment benefits paid for the period August 22, 2020, through
October 31, 2020, and are all included as benefits paid under Claim I.
On August 1, 2021, Flannery initiated a second claim for benefits (Claim
II). Flannery was unemployed for all or part of the periods January 9 through
22, 2022, and April 3 through 9, 2022. On January 15, 2022, Flannery used the
telephonic reporting system to certify his eligibility for benefits for the week
ending January 15, 2022. For reasons that are not explained in the record, those
benefits were paid for the week ending August 14, 2021, when he was employed.
On January 22, 2022, Flannery certified his eligibility for benefits for the week
ending January 22, 2022, which was paid as benefits for the week ending
December 25, 2021, when he was employed. On April 9, 2022, Flannery
certified his eligibility for benefits for the week ending April 9, 2022, which
were paid as benefits for the week ending January 8, 2022, when he employed.
Flannery testified he made numerous attempts to contact the Division to
correct the errors but was unable to contact a representative. Eventually, he
A-1421-24 5 "spoke to a woman . . . that summer . . . and tried to straighten this out." He was
"on the phone with [the representative for] over an hour." She "put [him] on
hold, came back" and said she "ha[d] everything on the computer here. [She
saw] what[ was] going on" and was "going to correct it." The representative
told him she "went and corrected everything for [him]. [He] d[id not] have to
worry about" anything.
On October 11, 2022, the Director of the Division issued a determination
and demand for refund of unemployment benefits. The Director determined
Flannery "improperly received unemployment benefits for which [he] w[as] not
eligible due to being employed by [South State]." As to Claim I, the Director
determined Flannery owed $7,843 in overpayments and a penalty of $1,960.75.
As to Claim II, the Director determined Flannery owed $2,193 in overpayments
and a penalty of $548.25. The Director also imposed a disqualification from
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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NOS. A-1421-24 A-1425-24
SHAWN P. FLANNERY,
Appellant,
v.
BOARD OF REVIEW, DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT and SOUTH STATE, INC.,
Respondents. ___________________________
Submitted May 5, 2026 – Decided May 20, 2026
Before Judges Perez Friscia and Vinci.
On appeal from the Board of Review, Division of Unemployment Insurance, Department of Labor and Workforce Development, Docket Nos. 317256 and 317257.
O'Brien Belland & Bushinsky, LLC, attorneys for appellant (David H. Lipow, on the briefs). Jennifer Davenport, Attorney General, attorney for respondent Board of Review (Janet Greenberg Cohen, Assistant Attorney General, of counsel; Christopher J. Chiacchio, Deputy Attorney General, on the briefs).
Testa Heck Testa & White, PA, attorneys for respondent South State, Inc. (Todd W. Heck, on the briefs).
PER CURIAM
In these related appeals, which we consolidated for the purpose of issuing
a single opinion, claimant Shawn P. Flannery appeals from two December 4,
2024 final decisions of the Board of Review (Board) finding him liable for non-
fraud refunds of unemployment benefits. For the reasons that follow, we vacate
and remand for the Board to make additional findings and explain the basis for
its determination of the amount of the overpayments, if any, Flannery is liable
to refund. On remand, the Board shall also address Flannery's claim that he is
entitled to a waiver of recovery of an overpayment of benefits pursuant to
N.J.A.C. 12:17-14.2(a) and N.J.S.A. 43:21-16(d)(3)-(5).
I.
We summarize the facts developed during the three-day telephonic
hearing before the Appeal Tribunal. Flannery testified that he is a laborer who
was temporarily laid off by his employer, South State, Inc. (South State), for
approximately fifteen weeks between November 2020 and April 2022.
A-1421-24 2 On March 15, 2020, Flannery initiated a claim with the Division of
Unemployment and Temporary Disability Insurance (Division) for
unemployment benefits (Claim I). Prior to November 2020, he applied for and
received unemployment benefits during calendar year 2020 for the week ending
August 15, 2020. He was thereafter employed by South State from
approximately August 16, 2020, until November 22, 2020.
Before November 2020, Flannery certified his eligibility for
unemployment benefits electronically using the internet. On November 28,
2020, Flannery attempted to certify his eligibility for unemployment benefits
but was unable to use the internet reporting system. Instead, he certified that he
was eligible for benefits using the Division's telephonic reporting system.
When he attempted to certify his eligibility for benefits for the week
ending November 28, 2020, the telephonic system directed him to certify his
eligibility for the week ending August 22, 2020, because his last claim for
benefits was for the week ending August 15, 2020. Flannery attempted to
correct the error but was unable to do so. As a result, he was paid unemployment
benefits for the week ending November 28, 2020, but the Division's records
incorrectly indicated the benefits were paid for the week ending August 22,
2020, when he was employed.
A-1421-24 3 This same error was repeated when he used the telephonic reporting
system to certify his eligibility for benefits for the weeks ending December 5,
12, 19, and 26, 2020, and January 2 and 9, 2021. The Division's records
incorrectly reflected that those claims for benefits were paid for the weeks
ending August 29, September 5, 12, 19, and 26, and October 3, 2020. It is
undisputed Flannery was employed during those periods.
Flannery was unemployed again from August 15 through September 11,
2021. On August 21, 2021, he used the telephonic reporting system to certify
his eligibility for benefits for the week ending August 21, 2021. Once again,
the system defaulted to October 3, 2020, and those benefits were incorrectly
paid as benefits for the week ending October 3, 2020, when Flannery was
employed.1 The same error was repeated when Flannery certified his eligibility
for benefits for the weeks ending August 28, and September 4, and 11, 2021.
Those benefits were incorrectly paid as benefits for the weeks ending October
10, 17, and 24, 2020, when Flannery was employed.
Flannery was unemployed from December 26, 2021, through January 1,
2022. On January 1, 2022, he used the telephonic system to certify his eligibility
1 It is not clear in the record why this was recorded as the week ending October 3, 2020, rather than October 10, 2020. That contradiction should be resolved, if possible, on remand. A-1421-24 4 for benefits for the week ending January 1, 2022. Those benefits were paid for
the week ending October 31, 2020, when Flannery was employed.
All the unemployment benefits Flannery received for the period
November 28, 2020, through January 1, 2022, were incorrectly paid by the
Division as unemployment benefits paid for the period August 22, 2020, through
October 31, 2020, and are all included as benefits paid under Claim I.
On August 1, 2021, Flannery initiated a second claim for benefits (Claim
II). Flannery was unemployed for all or part of the periods January 9 through
22, 2022, and April 3 through 9, 2022. On January 15, 2022, Flannery used the
telephonic reporting system to certify his eligibility for benefits for the week
ending January 15, 2022. For reasons that are not explained in the record, those
benefits were paid for the week ending August 14, 2021, when he was employed.
On January 22, 2022, Flannery certified his eligibility for benefits for the week
ending January 22, 2022, which was paid as benefits for the week ending
December 25, 2021, when he was employed. On April 9, 2022, Flannery
certified his eligibility for benefits for the week ending April 9, 2022, which
were paid as benefits for the week ending January 8, 2022, when he employed.
Flannery testified he made numerous attempts to contact the Division to
correct the errors but was unable to contact a representative. Eventually, he
A-1421-24 5 "spoke to a woman . . . that summer . . . and tried to straighten this out." He was
"on the phone with [the representative for] over an hour." She "put [him] on
hold, came back" and said she "ha[d] everything on the computer here. [She
saw] what[ was] going on" and was "going to correct it." The representative
told him she "went and corrected everything for [him]. [He] d[id not] have to
worry about" anything.
On October 11, 2022, the Director of the Division issued a determination
and demand for refund of unemployment benefits. The Director determined
Flannery "improperly received unemployment benefits for which [he] w[as] not
eligible due to being employed by [South State]." As to Claim I, the Director
determined Flannery owed $7,843 in overpayments and a penalty of $1,960.75.
As to Claim II, the Director determined Flannery owed $2,193 in overpayments
and a penalty of $548.25. The Director also imposed a disqualification from
unemployment benefits from October 11, 2022, through October 10, 2023 "due
to false or fraudulent misrepresentation."
Flannery appealed from the Director's determination and the Appeal
Tribunal conducted a telephonic hearing on January 9, March 15, and September
20, 2023. On September 20, 2023, the Appeal Tribunal issued two decisions
affirming the Director's determination as to Claims I and II. The Appeal
A-1421-24 6 Tribunal determined Flannery "did not report his wages for all of the weeks in
question" and "worked for [South State] for all of the weeks in question." The
Appeal Tribunal rejected Flannery's claim that "he did not properly report the
wages because he was attempting to collect for a different period of time, and
was paid for the wrong weeks by the [D]ivision." It concluded "[t]he receipt of
these benefits is considered to be as a result of false or fraudulent
representation."
On October 10, 2023, Flannery appealed to the Board. On December 4,
2024, the Board issued its final decisions modifying the Appeal Tribunal's
decisions. In its findings of fact applicable to both final decisions, the Board
found:
[Flannery] attempted to claim benefits for the periods of his temporary layoffs, via telephone and online, however, when certifying for benefits, [he] was directed to the last week he had previously certified for and was unable to correct the dates. [Flannery] made numerous attempts to the Division to rectify the matter, but was not able to reach a Division representative until the Summer of 2021, at which time he was instructed the matter would be rectified.
The Board determined it was
compelled to supplement the [f]indings of [f]act of the Appeal Tribunal . . . to more sufficiently reflect the record. [The Board] disagree[d] with the Appeal Tribunal's conclusion that [Flannery] knowingly
A-1421-24 7 withheld material facts in an attempt to receive unemployment benefit payments to which he was aware he was not entitled. [Flannery] filed the claim solely to collect benefits due to the loss of income resulting from his temporary layoff by the employer. [Flannery] was unaware of how to correct the weeks he was seeking to certify for and sought assistance from the Division. Therefore, [Flannery] did not knowingly make false statements, nor did he withhold any material facts, in an attempt to receive benefit payments. The fact that [Flannery] only received benefits for the approximate same number of weeks he was laid off tends to strongly support the conclusion that [he] did not willfully or knowingly defraud the Division. Since the [Flannery]'s receipt of the benefits was not a result of fraud or fraudulent misrepresentation, [he] is not disqualified for a period of one year from October 11, 2022, as provided by N.J.S.A. 43:2l-5(g)(1), and no fine . . . applies, in accordance with N.J.S.A. 43:21- 16(a).
Despite its determination that the dates included in Flannery's
certifications for benefits were incorrect, the Board calculated the amount of his
alleged liability for a non-fraud refund based on those incorrect dates. As to
Claim I, the Board determined Flannery "received an overpayment of benefits
for all of the relevant weeks" because he was employed. For the weeks ending
October 17 and October 31, 2020, it determined he was eligible for "partial
unemployment benefits of $36[]" and "received an overpayment of $677[] for
each of those weeks." The Board determined Flannery was "liable for a non-
fraud refund in the sum of $7,771[], received as benefits for the weeks ending
A-1421-24 8 August 22, 2020[,] through October 31, 2020, in accordance with N.J.S.A.
43:21-16(d)."
As to Claim II, the Board determined Flannery was obligated to refund
the full amount he received for the week ending January 8, 2022. It determined
he was "eligible for partial unemployment benefits of $173 each week" for the
weeks ending August 14, 2021, and December 25, 2021. The Board determined
he was liable for a non-fraud refund of $1,847 in connection with Claim II. This
appeal followed.
II.
On appeal, Flannery contends the Division should be estopped from
requiring a non-fraud refund of the alleged overpayment. He argues it was the
Division's "automated system . . . that generated the incorrect dates" and it "took
months for the [Division] to respond to [his] multiple requests for assistance in
correcting the issue." "When it finally did respond, [the Division's]
representative falsely told [him] that she would correct the issue." Flannery
argues "it is undisputed [he] only claimed and received benefits for the number
of weeks he was unemployed and, therefore, entitled to [b]enefits."
Flannery also argues "at the core of this appeal is [his] position that the
Board arbitrarily determined [his] eligibility" for benefits "based on his work
A-1421-24 9 history on the dates the Board had already determined were inaccurate and not
reflective of [his] period of unemployment." "The Board correctly referred to
[his] work history on the dates it determined [he was] unemployed," but then
"arbitrarily used data from the incorrect dates recorded by the [Division] to
determine" his eligibility for benefits and liability for a non-fraud refund.
He contends the Board's "determination of overpayment" should be
reversed "because the Board arbitrarily utilized data it acknowledged was
inaccurate to determine an overpayment." Flannery also argues we should
remand the matter to the Board to consider his argument, raised for the first time
on appeal, that he was entitled to a waiver of recovery for an overpayment of
benefits pursuant to N.J.A.C. 12:17-14.2(a) and N.J.S.A. 43:21-16(d)(3)-(5).
III.
An appellate court's review of an administrative agency decision is
narrow. Sullivan v. Bd. of Rev., Dep't of Lab., 471 N.J. Super. 147, 155 (App.
Div. 2022). In matters involving unemployment benefits, appellate courts afford
deference to the Board's expertise in administrating the Unemployment
Compensation Law (UCL), N.J.S.A. 43:21-1 to -71. Brady v. Bd. of Rev., 152
N.J. 197, 210 (1997). We will not reverse an agency's decision unless it is
"arbitrary, capricious, or unreasonable or . . . not supported by substantial
A-1421-24 10 credible evidence in the record." In re Ambroise, 258 N.J. 180, 197 (2024)
(quoting In re Stallworth, 208 N.J. 182, 194 (2011)).
Importantly, our ability to resolve an appeal from a final decision is
largely dependent upon the administrative agency clearly and adequately stating
its reasons, legal standards, and conclusions reached. N.J.S.A. 52:14B-10(d)
(the final decision must "include findings of fact and conclusions of law,
separately stated and . . . based only upon the evidence of record at the
hearing"). "Where the agency record is insufficient, we may order a remand to
the agency to more fully develop the record." ACLU of N.J. v. Hendricks, 233
N.J. 181, 201 (2018); see also Noble Oil Co. v. Dep't of Env't Prot., 123 N.J.
474, 475 (1991) (remanding to supplement an inadequate record).
Indeed, "[a]ppellate courts cannot exercise their duty of review unless
they are advised of the considerations underlying the administrative
determination." Mainland Manor Nursing & Rehab. Ctr. v. New Jersey Dep't of
Health & Senior Servs., 403 N.J. Super. 562, 571 (App. Div. 2008) (alteration
in original) (quoting In re Application of Holy Name Hosp., 301 N.J. Super.
282, 292 (App. Div. 1997)). "Consequently, '[i]t is the agency head's obligation
. . . to state the basis of decision with clarity; and, with sufficiency, to articulate
the factual determinations and legal standards that inform the action taken. '"
A-1421-24 11 Ibid. (alteration in original) (quoting In re Certificate of Need Application of
Arnold Walter Nursing Home, 277 N.J. Super. 472, 479 (App. Div. 1994)).
We are convinced remand is appropriate for the Board to clearly explain
the basis for its determination that Flannery is liable for a non-fraud refund. In
its decisions, the Board recognized Flannery attempted to certify his eligibility
for benefits correctly for weeks that he was unemployed. However, he "was
directed" by the Division's telephonic certification system "to the last week he
had previously certified for and was unable to correct the dates." The Board
found Flannery "filed the claim solely to collect benefits due to the loss of
income resulting from his temporary layoff by the employer."
In spite of its finding that the dates recorded by the Division's telephonic
certification system were incorrect, the Board used those incorrect dates to
determine the alleged overpayments. Specifically, the Board compared the
benefits Flannery received to the benefits he would have received for the weeks
he incorrectly certified rather than comparing the benefits he received to the
benefits he was entitled to and would have received for the weeks he was totally
or partially unemployed.
Based on the Board's findings, it follows that the alleged overpayments to
Flannery should have been determined by comparing the amount he received to
A-1421-24 12 the amount he was entitled to and should have received for the weeks he was
unemployed. In other words, whether he received more than he was entitled to
and was "overpaid."
Without a clear explanation of the rationale that informed the Board's
decision to calculate the amount of the alleged overpayment based on the
incorrect dates, we are unable to appropriately exercise our duty to review the
final decisions. Accordingly, we vacate the final decisions and remand for the
Board to re-issue final decisions clearly setting forth the reasoning supporting
its calculation of the alleged overpayments and non-fraud refund liability.
We decline to address Flannery's estoppel argument because it would be
premature to do so until the amount of his non-fraud refund liability, if any, is
determined. Finally, Flannery contends he is entitled to a waiver of recovery of
an overpayment pursuant to N.J.A.C. 12:17-14.2(a) and N.J.S.A. 43:21-
16(d)(3)-(5). The question of a refund waiver "should be decided in the first
instance, by the Division, applying its expertise." Mullarney v. Bd. of Rev., 343
N.J. Super. 401, 410 (App. Div. 2001). On remand, the Board shall determine
whether Flannery is entitled to a waiver of recovery.
Vacated and remanded for further proceedings in conformity with this
opinion. We do not retain jurisdiction.
A-1421-24 13