Strobert Tree Service, Inc. v. Unemployment Insurance Appeal Board

• Court: Superior Court of Delaware
• Decided: November 2, 2023
• Docket: S23A-05-001 RHR
• Status: Published

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

STROBERT TREE SERVICE, INC., ) ) Appellant, ) ) v. ) C.A. No. S23A-05-001 RHR ) UNEMPLOYMENT INSURANCE ) APPEAL BOARD, DELAWARE ) DEPARTMENT OF LABOR, ) and GEORGE SHAW, ) ) Appellees. )

Submitted: August 14, 2023 Decided: November 2, 2023

Upon Consideration of an Appeal of a Decision of the Unemployment Insurance Appeal Board, AFFIRMED.

MEMORANDUM OPINION AND ORDER

Victoria K. Petrone, Esquire, Brian V. DeMott, Esquire, Baird Mandalas Brockstedt & Federico, LLC, 2711 Centerville Road, Suite 401, Wilmington, Delaware 19808, Attorneys for Appellant Strobert Tree Service, Inc.

Victoria W. Counihan, Esquire, Delaware Department of Justice, 820 N. French Street, 6th Floor, Wilmington, Delaware 19801, Attorney for the Delaware Division of Unemployment Insurance.

Matthew B. Frawley, Esquire, Delaware Department of Justice, 820 N. French Street, 6th Floor, Wilmington, Delaware 19801, Attorney for the Unemployment Insurance Appeal Board.

George Shaw, Pro Se, Appellee.

ROBINSON, J. Strobert Tree Service, Inc. (“STS”) appeals the decision of the Unemployment

Insurance Appeal Board (“UIAB”) that upheld the Appeal Referee’s decision

granting George Shaw (“Shaw”) unemployment insurance benefits. Because neither

Shaw nor the UIAB filed a response, this opinion is based on STS’s arguments raised

on appeal and the record below.1 For the following reasons, the UIAB’s decision is

AFFIRMED.

BACKGROUND

Shaw was employed by STS, a tree removal company, as an estimator until

his termination in September of 2022. Just prior to his termination, Shaw met with

an STS customer to provide a quote for tree removal services. The customer

commented that she needed repair work to a door, and Shaw offered to do the work

as a side job to his regular employment with STS. After Shaw completed the side

job, the customer was unhappy with the quality of the work and initially refused

payment. The customer claimed Shaw and his partner threatened her and she

eventually paid Shaw because she was afraid. The customer complained to Wanda

Hancock-Williams, who works in the office of STS, that Shaw threatened her during

that interaction. Hancock-Williams relayed the complaint to Andrew Strobert, the

owner of STS, who then told Hancock-Williams to fire Shaw. She did so, and

1 See Dkt. No. 10. 2 Shaw—frustrated that he was fired without being given an opportunity to give his

side of the story—applied for unemployment benefits.

A Claims Deputy first reviewed the claim and determined that Shaw did not

qualify for benefits. Shaw appealed this decision to a Division of Unemployment

Insurance Appeals Referee. No one from STS appeared for this hearing, and the

Referee overturned the Claims Deputy’s decision as unopposed. After STS received

the Referee’s decision, STS appealed to the UIAB, arguing that it had not received

notice of the Referee’s hearing. The UIAB remanded the matter to the Referee, and

another hearing was scheduled.

During the second hearing before the Appeals Referee, Shaw’s partner, who

helped him with the side job and was present during the alleged argument between

Shaw and the disgruntled customer, testified that the customer avoided paying Shaw,

but that no one threatened her. Hancock-Williams and Strobert—neither of whom

had witnessed the interaction between Shaw and the disgruntled customer—testified

for STS. They stated that they were shocked by the allegations from the customer

and that Shaw’s alleged behavior reflected badly on STS. The Referee ruled in

Shaw’s favor, explaining that the only evidence submitted by STS was hearsay and

that it could not rely solely on hearsay in reaching its decision. The Referee found

3 that STS did not establish that there was willful or wanton misconduct on the part of

Shaw that would warrant his termination for just cause.

STS appealed the Referee’s decision to the UIAB. Before the UIAB, Strobert

stated that the complaining customer was not willing to testify because she was

afraid of Shaw. He submitted an email from the customer stating that Shaw

approached her in a threatening matter and yelled at her. Otherwise, the parties

submitted similar evidence to what was presented in the prior proceedings.

Again, the Board held that the evidence presented was hearsay and “the Board

cannot rely on hearsay evidence alone to support a conclusion.”2 Now, STS asks

this court to overturn the UIAB decision.

STANDARD OF REVIEW

On appeal, the court must determine if the UIAB’s decision was free from

legal error and supported by substantial evidence.3 Substantial evidence requires

“such relevant evidence as a reasonable mind might accept as adequate to support a

conclusion.”4 This court will only reverse a board’s decision if it “acts arbitrarily or

capriciously or exceeded the bounds of reason in view of the circumstances and has

ignored recognized rules of law or practice so as to produce injustice.”5

2 UIAB Record at 8. 3 Tuttle v. Mellon Bank of Delaware, 659 A.2d 786, 788 (Del. Super. Ct. 1995). 4 Del. Supermarkets, Inc. v. Davis, 2015 WL 2415655, at *1 (Del. Super. Ct. Apr. 29, 2015). 5 Id. 4 DISCUSSION

Under Delaware law, an employee may not recover unemployment benefits if

he was discharged for just cause.6 “Just cause” is defined as a “willful or wanton act

in violation of either the employer’s interest or the employee’s expected standard of

conduct.”7 When arguing that an employee is not entitled to the receipt of

unemployment benefits, the employer has the burden of establishing just cause.8

Hearsay is an out of court statement which a party offers as the truth.9 Despite

the fact that the UIAB can consider hearsay testimony, a UIAB decision may not be

based on hearsay only: “The [UIAB] follows the Delaware Rules of Evidence. The

Board may admit and consider hearsay evidence, however, the [UIAB] shall not base

its decision solely on hearsay or other evidence not admissible under the Rules of

Evidence.”10 In Delaware Supermarkets, Inc., v. Davis, an employer terminated an

employee after a customer complained that the employee made inappropriate

comments about the customer’s use of food stamps at checkout.11 An appeals referee

determined (and the UIAB later agreed) that the employee was fired without just

6 Ocean Limo Transp. LLC, v. Grant, 2017 WL 1829245, at *2 (Del. Super. Ct. May 3, 2017). 7 Del. Supermarkets, 2015 WL 2415655, at *1. 8 Ocean Limo Transp. LLC, 2017 WL 1829245, at *2. 9 D.R.E. 801(c)(1)(2). 10 19 Del. Admin. Code § 1201, Rule 4.7.1 (2022). 11 Del. Supermarkets, 2015 WL 2415655, at *1. See also Ocean Limo Transp. LLC, 2017 WL 1829245, at *2 (“A ruling may not rest on hearsay evidence alone.”).

5 cause “because the only evidence provided by the employer . . . was hearsay.”12 In

its opinion affirming the UIAB decision, this court explained that the Board has

discretion to admit and consider hearsay evidence.13 However, the court rightly

observed that, “decisions cannot be made on hearsay alone.”14

STS contends that Delaware Supermarkets, Inc. contemplated an exception to

the rule.15 It does not. While it is true that the decision explains there are situations

for which hearsay evidence can be considered, the decision neither overrules Rule

4.7.1, nor creates an exception. The cited language simply explains that there are

situations where it is understandable that a complaining customer may not be able

to testify in front of the UIAB. However, to satisfy the just cause standard, a single,

non-testifying customer complaint is not sufficient.16

Without something more, the UIAB cannot render a decision solely based on

hearsay evidence.17 Here, STS only presented hearsay to the UIAB. Based on the

foregoing, this Court is satisfied that the Board applied the applicable legal standards

12 Id. 13 Del. Supermarkets, 2015 WL 2415655, at *2. 14 Id. 15 Appellant’s Opening Brief on Appeal, D.I. 10 at 14. 16 See generally Del. Supermarkets, 2015 WL 2415655, at *2 (“A submitted complaint to Shop Rite pertaining to the Employee, alone, is not an adequate showing of willful or wanton conduct.”). 17 Supra n. 9-10. 6 and reached the correct decision. Therefore, the judgment of the Board must be

IT IS SO ORDERED.