Cole v. N.C. Dep't of Pub. SafetyÂ, 253 N.C. App. 270

Background

Randall Cole was promoted to plant manager at Craggy Laundry in Dec. 2010; a change-of-command audit revealed numerous deficiencies and a follow-up audit was ordered.
Cole received a series of corrective actions: written warnings for failure to correct audit deficiencies (Dec. 2011 and Sept. 2013) and for failing to obtain required Laundry Manager certification (Mar. 2013); each warned discipline up to dismissal.
After continued deficiencies (including failure to forward receipts and safety- related lapses), Cole was dismissed for unsatisfactory job performance; the agency’s internal appeal affirmed dismissal.
Cole filed an OAH contested-case petition in Apr. 2014, voluntarily dismissed it, then refiled a second petition in Aug. 2015; Respondent moved to dismiss arguing Rule 41(a)(1) did not apply to OAH proceedings.
The ALJ denied the motion to dismiss, found Respondent lacked just cause because two prior warnings were not "active," and ordered reinstatement with demotion. The Court of Appeals reversed, holding Respondent had just cause to dismiss.

Issues

Issue	Cole's Argument	DPS's Argument	Held
Applicability of N.C.G.S. § 1A-1, Rule 41(a)(1) to OAH contested cases	Rule 41(a)(1) permits voluntary dismissal and refiling; applies to OAH so Cole could refile within 1 year	Rule 41(a)(1) applies to "actions" and not OAH contested cases; statute limiting OAH to 180 days makes Rule 41 inapplicable	Rule 41(a)(1) applies to OAH contested cases under 26 NCAC 03 .0101(a); voluntary dismissal left petitioner where he began and allowed refiling within a year.
ALJ findings of fact challenged by DPS	(n/a) Cole relied on ALJ findings to prevail	Several ALJ findings lacked substantial evidentiary support	Court deemed challenged findings immaterial or legal conclusions; unchallenged findings sufficed to decide case.
Whether DPS had just cause to dismiss Cole for unsatisfactory job performance	Cole argued two prior disciplinary actions were not "active" under the Code’s definition, so dismissal lacked just cause	DPS argued Cole had at least two prior written warnings and the third warning was the current incident, meeting 25 NCAC 01J .0605(b)	Held that DPS met the plain requirements of 25 NCAC 01J .0605(b); Cole’s prior warnings satisfied the two-prior-action requirement and DPS had just cause to dismiss.
Effect of the Administrative Code’s definition of "inactive disciplinary action" on dismissal requirement	Cole/ALJ: the definition implies prior warnings must be "active" to count toward the two required actions	DPS: 01J .0605(b) requires two prior disciplinary actions but does not condition them on being "active"; the definitional provision is not operative unless the term is used	Court refused to read an additional "active" requirement into 01J .0605(b); the definition (01J .0614(6)) does not by itself alter 01J .0605(b).

Key Cases Cited

Dion v. Batten, 790 S.E.2d 844 (N.C. Ct. App. 2016) (statutory interpretation reviewed de novo)
Scott v. N.C. Dep’t of Crime Control & Pub. Safety, 730 S.E.2d 806 (N.C. Ct. App. 2012) (Rule 41 principles applied in OAH contested-case context)
Lincoln v. N.C. Dep’t of Health & Human Servs., 616 S.E.2d 622 (N.C. Ct. App. 2005) (application of civil procedure rules to OAH contested cases)
Brisson v. Santoriello, 528 S.E.2d 568 (N.C. 2000) (effect of voluntary dismissal under Rule 41(a))
Teague v. Randolph Surgical Assocs., 501 S.E.2d 382 (N.C. Ct. App. 1998) (voluntary dismissal leaves nothing in dispute)
N.C. Dep’t of Env’t & Natural Res. v. Carroll, 599 S.E.2d 888 (N.C. 2004) (standard of review for just-cause dismissal)
Correll v. Division of Social Services, 418 S.E.2d 232 (N.C. 1992) (statutory construction principles)
Lemons v. Old Hickory Council, 367 S.E.2d 655 (N.C. 1988) (plain meaning rule in statutory construction)
State v. Wiggins, 158 S.E.2d 37 (N.C. 1967) (words given plain and ordinary meaning)
Kyle v. Holston Group, 656 S.E.2d 667 (N.C. Ct. App. 2008) (applying statutory construction rules to administrative regulations)
State v. Singletary, 786 S.E.2d 712 (N.C. Ct. App. 2016) (rejecting extratextual statutory interpretation)
Koufman v. Koufman, 408 S.E.2d 729 (N.C. 1991) (unchallenged findings on appeal are conclusively established)
Estate of Joyner v. N.C. Dep’t of Health & Human Servs., 715 S.E.2d 498 (N.C. Ct. App. 2011) (agency manuals do not override formal statutes/regulations)