State Ex Rel. Workforce Safety & Insurance v. Questar Energy Services, Inc.

2017 ND 241, 902 N.W.2d 757, 2017 WL 4638693, 2017 N.D. LEXIS 255
CourtNorth Dakota Supreme Court
DecidedOctober 17, 2017
Docket20170059
StatusPublished
Cited by6 cases

This text of 2017 ND 241 (State Ex Rel. Workforce Safety & Insurance v. Questar Energy Services, Inc.) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Ex Rel. Workforce Safety & Insurance v. Questar Energy Services, Inc., 2017 ND 241, 902 N.W.2d 757, 2017 WL 4638693, 2017 N.D. LEXIS 255 (N.D. 2017).

Opinions

Jensen, Justice.

[¶ 1] North Dakota Workforce Safety and Insurance (“WSI”), appealed from the judgment affirming a decision of an Administrative Law Judge (“ALJ”) that had reversed WSI’s administrative reclassification of Questar Energy Services, Inc.’s (“Questar”) employees. We affirm.

I

[¶ 2] In July 2012, Questar applied for and received insurance coverage from WSI. Following an audit in 2014, WSI determined Questar’s employees had been improperly classified and reclassified Questar’s employees. The classification of employees directly impacts the insurance rate used to calculate Questar’s premiums for the insurance received from WSI.

[¶ 3] WSI issued a Notice of Decision to inform Questar of the audit results and the reclassification of Questar’s employees. Questar filed with WSI a request for reconsideration of WSI’s decision to reclassify Questar’s employees. - WSI issued an administrative order confirming its Notice of Decision and Questar responded by requesting a rehearing. The request for a rehearing triggered the administrative hearing process and the assignment of an ALJ.

[¶ 4] Following an administrative hearing, the ALJ issued Findings of Fact, Conclusions of Law, and Final Order reversing WSI’s administrative order. The ALJ applied a preponderance of the evidence standard for the review of WSI’s employee classification determination. Applying that standard, the ALJ concluded the evidence provided during the hearing did not support WSI’s reclassification but did support Questar’s requested classification. WSI appealed the ALJ’s decision to the district court, which concluded the ALJ applied the correct standard of review, properly excluded changes to the Rate Classification Manual made after WSI’s determination, and properly determined Questar’s requested classification was supported by a preponderance of the evidence.

II

[¶ 5] WSI appeals the judgment entered following the district court’s review of the ALJ’s determination. WSI contends the ALJ applied the wrong standard of review, improperly excluded from evidence the changes to the Rate Classification Manual, and erred in determining classification of Questar’s employees was not supported by the record.

[¶ 6] Appellate review of a final order of an administrative agency is governed by the Administrative Agencies Practice Act, N.D.C.C. ch. 28-32. Pursuant to the directives contained, in N.D.C.C. §§ 28-32-46 and 28-32-49, the district court and this Court must affirm an administrative agency order unless;

1. The order is not in accordance with the law.
2. The order is in violation of the constitutional rights of the appellant.
3. The provisions of this chapter have not been complied with in the proceedings before the agency.
4. The rules or procedure of the agency have not afforded the appellant a fair hearing.
5. The findings of fact made by the agency are not supported by a preponderance of the evidence.
6. The conclusions of law and order of the agency are not supported by its findings of fact.
7. The findings of fact made by the agency do not sufficiently address the evidence presented to the agency by the appellant.
8. The conclusions of law and order of the agency do not sufficiently explain the agency’s rationale for not adopting any contrary recommendations by a hearing officer or an administrative law judge.

N.D.C.C. § 28-32-16.

[¶7] This Court recently summarized appellate review of and the deference 'given to an ALJ’s factual findings and legal conclusions as follows:

In reviewing an ALJ’s factual findings, a court may not make independent findings of fact or substitute its judgment for the ALJ’s findings; rather, a court must determine only whether a reasoning mind reasonably could have determined the findings were proven by the weight of the evidence from the entire record. [Workforce Safety &Ins. v.] Auck, 2010 ND 126, ¶ 9, 785 N.W.2d 186; Power Fuels, Inc. v. Elkin, 283 N.W.2d 214, 220 (N.D. 1979). When reviewing an appeal from a final order by an independent ALJ, similar - deference is given to the ALJ’s factual findings because the ALJ has the opportunity to observe and assess witnesses’ credibility and resolve conflicts in the evidence. Auck, at ¶9. Similar deference is not given to an independent ALJ’s legal conclusions, and a court reviews the independent ALJ’s legal conclusions in the same manner as legal conclusions generally. Id. Questions of law, including the interpretation of a. statute, are fully reviewable on appeal. Id. ■

Indus. Contractors, Inc. v. Taylor, 2017 ND 183, ¶ 8, 899 N.W.2d 680.

[¶ 8] The ALJ’s legal conclusion regarding the appropriate standard of review for reviewing WSI’s classification of Questar’s employees is a question of law which may be fully reviewed on appeal. The ALJ applied a preponderance of the evidence standard of review, concluding that classification of employees by WSI is a question of fact. WSI contends that classification of employees is a question of law, and the ALJ’s review should have been limited to consideration of whether, or not WSI’s corn elusion of law (the classification of employees) was supported by WSI’s findings of fact. We hold that WSI’s determination regarding the classification-of employees is a mixed question of law and fact.

[¶9] Classification of employees by WSI is analogous to the determination of whether or not a worker is an independent contractor or an employee. We have previously recognized determination of whether a worker is an employee or an independent contractor is a mixed question of law and fact, stating the following:

“Whether a worker is an independent contractor or an employee is a mixed question of fact and law.” Matter of BKU Enterprises, Inc., 513 N.W.2d 382, 387 (N.D. 1994). In reviewing «-a mixed question of fact and law, the- underlying predicate facts are treated as findings of fact, and the conclusion whether those facts meet the legal standard is a question of law. Id.

Workforce Safety & Ins. v. Larry’s On Site Welding, 2014 ND 81, ¶ 14, 845 N.W.2d 310. In this case, our review of the classification of the employee's is therefore divided into two tasks: determination of whether the underlying predicate facts are supported by a preponderance of the evidence and determination of whether' those findings support the classification.

Ill

[if 10] Our review of the ALJ’s findings of fact is limited to consideration of whether a reasoning mind reasonably could have determined the findings were proven by the weight of the evidence from tiie entire record. Workforce Safety & Ins. v. Auck, 2010 ND 126, 19, 785 N.W.2d 186; Power Fuels, Inc. v. Elkin, 283 N.W.2d 214

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Cite This Page — Counsel Stack

Bluebook (online)
2017 ND 241, 902 N.W.2d 757, 2017 WL 4638693, 2017 N.D. LEXIS 255, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-workforce-safety-insurance-v-questar-energy-services-inc-nd-2017.