Smith v. Department of Workforce Services
2010 UT App 382
Utah Ct. App.2010Background
- Smith was separated from JetBlue on 12/31/2008 with a lump-sum severance/unused vacation payment of $18,960.74.
- On 01/03/2009 she claimed unemployment benefits by telephone and answered no to receiving severance/vacation pay.
- A cross-check revealed the $18,960.74 payment; Smith admitted receipt and review of the Department's Claimant Guide but said the payment was a bonus, not reportable income.
- The Department found an $8,887 overpayment and assessed a civil fraud penalty equal to the overpayment.
- An ALJ held the Department's decision; the Board affirmed the fraud finding and the repayment plus penalty; Smith challenges both decisions.
- The ALJ erroneously treated Smith’s husband as a witness when he was present as a representative; the Board found harmless error and affirmed the ruling.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there was substantial evidence of fraud | Smith argues the evidence does not show knowledge or willfulness | Smith knew or should have known to report the payment as reportable income | Fraud sustained; substantial evidence supports findings |
| Whether exclusion of Smith's representative prejudiced the proceedings | Smith asserts substantial prejudice from his exclusion | Error was harmless; outcome unlikely to change even with representative present | Not substantially prejudicial; Board affirmed the decision |
Key Cases Cited
- Angell v. Board of Review of Industrial Commission, 750 P.2d 611 (Utah Ct.App. 1988) (reversal for exclusion of representative under pre-UAPA law; prejudice favored petitioner)
- Morton Int'l, Inc. v. Utah State Tax Comm'n, 814 P.2d 581 (Utah 1991) (harmful error standard applied to agency review)
- Slinger v. Board of Review of Indus. Comm'n, 733 P.2d 122 (Utah 1987) (prejudice standard in agency review; doubt resolved in petitioner's favor)
- Diprizio v. Industrial Comm'n, 572 P.2d 679 (Utah 1977) (fraud standard; use of statutory framework and evidence)
- Johnson v. Department of Emp't Sec., 782 P.2d 965 (Utah Ct.App. 1989) (review of agency findings; reasonableness and rationality)