NICOLE L. DUFAULT VS. BOARD OF REVIEW (BOARD OF REVIEW, DEPARTMENT OF LABOR) (RECORD IMPOUNDED), A-2132-15T4

Background

Nicole L. Dufault, a tenured high‑school English teacher, was suspended with pay at start of 2014–2015 school year after an arrest; suspended without pay effective March 1, 2015 after an Essex County grand jury indicted her on multiple criminal charges alleging sexual acts with students.
Dufault applied for unemployment benefits on February 22, 2015; a deputy director found her disqualified under N.J.S.A. 43:21‑5(b) for gross misconduct and she appealed.
At Appeal Tribunal hearings Dufault invoked the Fifth Amendment and refused to answer questions about the charges; the BOE’s counsel described the indictment and later disclosed Dufault resigned under a July 21, 2015 settlement agreement.
The Appeal Tribunal disqualified Dufault under both N.J.S.A. 43:21‑5(b) (gross misconduct) and N.J.S.A. 43:21‑5(a) (voluntary leaving without good cause); the Board of Review affirmed, finding (1) she voluntarily resigned without good cause and (2) an adverse inference from her Fifth Amendment silence supported a finding of gross misconduct.
Dufault appealed, arguing BOE failed to prove gross misconduct, the tribunal did not act expeditiously, and the BOE was bound by the settlement’s promise not to take adverse action on her unemployment claim. The Appellate Division affirmed.

Issues

Issue	Dufault's Argument	BOE/Respondent's Argument	Held
Was Dufault disqualified under N.J.S.A. 43:21‑5(a) for voluntarily leaving without good cause?	She resigned under a settlement and BOE agreed not to take adverse action on benefits.	BOE says she voluntarily resigned; settlement does not bind Board; Board must decide based on law/facts.	Held: She voluntarily resigned July 21, 2015, without good cause; disqualified under §43:21‑5(a).
Was she disqualified under N.J.S.A. 43:21‑5(b) for suspension/discharge for gross misconduct?	BOE allegedly relied on hearsay; insufficient proof of gross misconduct; BOE had burden to prove it.	Indictment and allegations of sexual acts with students support gross misconduct; adverse inference permissible from Fifth Amendment silence.	Held: Board reasonably inferred guilt from refusal to testify; sufficient evidence to find gross misconduct and disqualify under §43:21‑5(b).
Can an adverse inference be drawn when claimant invokes Fifth Amendment in civil/unemployment proceedings?	Dufault argued invocation should not lead to disqualification absent stronger proof.	Respondent relied on precedent allowing adverse inference in civil matters and administrative settings.	Held: Adverse inference permissible; courts/boards may draw negative inference when claimant refuses to answer about matters within personal knowledge.
Did delay in processing appeals entitle Dufault to benefits?	She claimed appeals were not processed expeditiously per statute.	Tribunal processed appeals promptly; statute does not automatically award benefits for delay.	Held: No merit; appeals were processed expeditiously and delay does not entitle claimant to benefits.

Key Cases Cited

Brady v. Bd. of Review, 152 N.J. 197 (discussing limited scope of appellate review of administrative agency findings)
Pub. Serv. Elec. & Gas Co. v. N.J. Dep't of Envtl. Prot., 101 N.J. 95 (standard for review of agency action)
In re Warren, 117 N.J. 295 (agency decision reversal standards)
Charatan v. Bd. of Review, 200 N.J. Super. 74 (factual findings in unemployment proceedings reviewed for reasonableness)
Domenico v. Bd. of Review, 192 N.J. Super. 284 (definition of "good cause" for voluntarily leaving employment)
Condo v. Bd. of Review, 158 N.J. Super. 172 (construing "good cause")
Attor v. Attor, 384 N.J. Super. 154 (adverse inference may be drawn when party invokes Fifth Amendment in civil case)
Mahne v. Mahne, 66 N.J. 53 (Fifth Amendment invocation and adverse inference doctrine)
Bastas v. Bd. of Review, 155 N.J. Super. 312 (Board may draw adverse inference from claimant's refusal to testify on benefits‑related facts)
Duratron Corp. v. Republic Stuyvesant Corp., 95 N.J. Super. 527 (adverse inference in civil proceedings when party refuses to testify)
SEC v. Greystone Nash, Inc., 25 F.3d 187 (Fifth Amendment invocation in civil cases may give rise to adverse inference)
Baxter v. Palmigiano, 425 U.S. 308 (Supreme Court discussion of Fifth Amendment in civil contexts)