Agrawal v. Oklahoma Department of Labor

OPINION

1 1 We consider whether the district court erred in affirming the appeal brought by Appellants from the order of the Oklahoma Department of Labor (ODOL) administrative court in this wage claim appeal. Two major issues are considered in this case: (1) whether ODOL erred when it allowed Appel- - lee/wage claimant Christopher Holland's join-der of multiple employers in a single wage claim; and (2) whether the ODOL court erred in prohibiting Appellants/Employers from presenting evidence at the Administrative Hearing. We answer both questions in the negative and affirm the "district court.

FACTUAL AND PROCEDURAL BACKGROUND

(District Court cases OJ-2010-5757 and CJ-2010-5758)

T2 On November 11, 2008, Appel-lee/wage claimant Christopher Holland filed a claim for unpaid wages in the Oklahoma Department of Labor (ODOL) against Appellants Kris Agrawal, Vimala Agrawal and the business entities which they allegedly own.1 Claimant alleged he was owed $86,750.00 for unpaid wages. He later modified the amount owed to $84,850.00. . ODOQL attempted to give notice by certified mail of the wage claim to Kris and Vimala Agrawal and the *620business entities on November 14, 2008. However, the certified mail receipts which were sent to the business entities were returned "Refused".2 Certified mail notice was sent to attorney Raymond A. Vincent, Appellants' counsel at that time. The return receipt was signed by Amy Jordan, apparently of Vincent's firm, and returned. The front of the return receipt form contained the case numbers for each of the wage claims filed in the ODOL against the appellants, including Holland's case number 2009-00546. Raymond Vincent filed an Entry of Appearance in this case on December 10, 2008, although he had already appeared in the previous case, 2008-00689, on behalf of GEO Exploration,3 by filing the Motion to Vacate Administrative Order of Determination which resulted in the dismissal of that case.4

T3 On February 3, 2009, Labor Compliance Officer Debra Metheny issued an Administrative - Order - of - Determination awarding Holland wages of $34,350.00 and, pursuant to 40 O.S. § 165.3(B)5 also awarded liquidated damages of $834,350.00, for a total award of $68,700.00. On February 5, 2009, the appellants, through their attorney, Raymond A. Vincent, requested an administrative hearing.6

T4 Leave was also granted to ODOL to allow substitutional service to be made.7 The Administrative Hearing was held on February 10, 2010. The ALJ ruled in favor of Holland on his wage claim and affirmed the Administrative Order of Determination. The ALJ's Final Agency Determination, filed March 17, 2010, was appealed to the district court, which affirmed it on September 12, 2012. Petitions for certiorari were timely filed by Vimala Agrawal, (pro se), in Case 111,809; and by Kris Agrawal and the business entities, in Case 111,837. By Supreme *621Court order dated November 8, 2018, the cases were consolidated under surviving case number 111,809. On the same day, the consolidated cases were made a companion case to case number 112,816.8

ADMINISTRATIVE PROCEDURES, ACT APPEALS

T5 Under the Protection of Labor Act, 40 0.8.2011 §§ 165.1-165.11, final administrative orders of the Oklahoma Department of Labor (ODOL) in wage claim cases are subject to appeal pursuant to the Administrative Procedures Act (APA), T5 0.8.2011 §§ 250-328. See 40 O0.8.2011 § 165.7(E). Under the APA, proceedings for review are instituted by filing a petition in the district court of the county in which the party seeking review resides within thirty (80) days after the appellant is notified of the final ageney order. See 75 0.8.2011 § 318(B)(@).9 The standard of review for appeals from an administrative agency is found at 75 0.8.2011 § 822.10 An agency's order will be affirmed if the record contains substantial evidence in support of the facts upon which the decision is based and the order is otherwise free of error. Scott v. Oklahoma Secondary School Activities Ass'n, 2018 OK 84, 318 P.3d 891, 299 Ed. Law Rep. 233. The order is subject to reversal, however, if the appealing party's substantial rights were prejudiced because the agency's findings, inferences, conclusions or decisions were entered in excess of its statutory authority or jurisdiction, or were arbitrary, capricious, or clearly erroneous in view of the reliable, material, probative and substantial competent evidence. Id.; Oklahoma Dept. of Public Sofety v. McCrady, 2007 OK 89, 176 P.3d 1194. An appellate court may not substitute its judgment for that of the ageney on its factual determinations. McCrady, supra, at 1200-1201.

EVIDENCE AT THE ADMINISTRATIVE HEARING

16 Holland testified he was hired by Kris Agrawal to assist him in the management of *622the Agrawais' companies. He stated that he was hired as an "office manager" or "field manager" at $200.00 per day. He testified his work assignments could vary from day to day, or even as to parts of a day, and that he was not always aware which business entity he was serving. Holland stated the ODOL investigator had "me list out the days" he worked for Agrawal's companies, He prepared a document" for the administrative hearing to provide evidentiary support for his claim. However, he stated he did fot keep time sheets or a record of his own hours, He kept a diary of the number of hours he spent on location with a particular company so that "if they tried to overbill or misstate their hours, I knew what they were." He wrote down the subcontractors' hours spent on a particular well and submitted a daily report by email to Mr. Agrawal "as directed." (ODOL Trans., pp. 66-67). He stated that during his first month of employment he went to Beaver County with Mr. Agrawal to work as his personal assistant. GEO Exploration was the company name on the sign at the well, and the first two weeks of employment he did not know whether he worked for Agrawal or GEO Exploration, (ODOL Trans., pp. 69-70). He testified that during his employment, he did work for "GEO Exploration, General Holding, Realty Management, General Minerals and Online Oil". (ODOL Trans., p. 28.) He indicated that if he was sent to Tulsa, he would have been working for Online Oil. If he was sent to Beaver County, it would have been for GEO Exploration. (ODOL Trans., p. 28). He also alleged an "alter ego" theory relating to Agrawal's companies 11(ODOL Trans., p. 46).12 Holland also testified as to his proposed offers to Agrawal to accept less than $200.00 per day in order to settle the matter prior to filing a wage claim. He submitted exhibits showing he offered to accept $100.00 per day on January 1, 2008,13 $11.25 per hour on September 12, 2007, and $10.00 per hour on January 8, 2008." He stated he did this in an effort to continue working for Agrawal, rather than for another company. When Agrawal did not respond, Holland filed this claim.

T7 Holland testified that Agrawal supervised his work and that they were in contact with each other daily, Holland stated Agra-wal instructed him on his duties, assigned his jobs, set his hours, and supplied the tools used. He also testified the work he performed was part of the regular business of GEO Exploration and the other entities, and that Agrawal had the right to criticize and to correct the job he did.

18 The evidentiary materials Holland prepared for ODOL were labeled the "State's *623. Administrative Hearing Exhibits" and included photocopies of checks, invoices, emails, letters from Agrawal to Holland, and memos showing that Holland was involved in the business affairs of Agrawal.14 Also included was an itemized list of the days Holland worked for Agrawal's companies, the number of hours worked, and for whom he worked. These materials together comprised "Exhibit 1", found at pages 1-1 through 1-80 of the ODOL record, compiled within the O.R. at pp. 42-121. Appellants' attorney requested, and was allowed, to admit them into evidence. Appellants were also allowed to raise affirmative defenses and, 'to cross- examine witnesses, although they were not allowed to present witnesses or exhibits.

T9 Agrawal complained about the credibility of Holland's prepared time records which were not prepared contemporaneously with the work described, and questioned Holland's memory. as to the hours worked and for. which company. - However, .Mr. Towery, counsel for the ODOL, reminded the court that the alleged lack of credibility of Hol-, land's documents should have been challenged at the time of the response and the prehearing conference, 'The ALJ stated she believed the evidence showed Holland worked for Agrawal, rather than his entities, and that if he was paid by the day, the number of hours worked per day was irrelevant 15

DISCUSSION

110 First, Kris Agrawal alleges the ODOL administrative court should not have allowed Holland's joinder of multiple employers in a single wage claim which should have been dismissed. Agrawal contends 40 0.8. § 165.7(B)16 prohibits such joinder, but that *624the ODOL improperly allowed Holland to join seven employers in each of the wage claim cases and found all of them liable. He alleges that Holland's initial claim was against only GEO Exploration, LLC and that Holland swore that it was his only employer, although he had done work for each of the named - entities, - Agrawal | also ODOL's employee Debra Metheny, the Labor Compliance Officer assigned to Holland's claim, conducted an improper post-claim filing investigation in which she obtained Agra-wal's companies' names from Holland's workers' compensation case. According to Kris Agrawal, when the final notice of the wage claim was prepared, he and Vimala were improperly listed as "dba" and "and/or", individually or collectively, with the other respondents. He contends this is confusing at best. At worst, he argues that these designations create an ambiguity that the "single employer" rule could be disregarded by the courts, ‘ alleges

{11 Moreover, he contends that in the Final Order of Determination, the ALJ entered judgment against each of the respondents, although she stated at the hearing that she was finding against Mr,. Agrawal personally. Agrawal's counsel, Mr, Solomon, argued that designating Agrawal as "doing business as" these entities was improper, as he has never been named individually as the employer, and suggested the ALJ did not have the ability to aggregate all of the entities under the evidence. The ALJ responded: "And I don't have to aggregate them because I'm finding against him personally." The ALJ also stated:

Mr. Agrawal did have notice. He specifically requested an administrative hearing and having chosen to avail himself for that legal avenue, he's hard pressed now to complain that he didn't know he was included as a potential employer in this case. (Emphasis added). (ODOL Trans., p. 79) ° ~

.T12 In response, Holland contends the ODOL has the authority to join multiple employers in a single wage claim. He refers the Court to Stipe v. State ex rel. Board of Trustees of the Oklahoma Public Employees Retirement System, 2008 OK 52, 188 P.3d 120. 'We held that where the legislature has not shown its disapproval of an interpretation an agency has given to a statute, the legislature's silence may be regarded as acquiescence in the agency's statutory construction. Stipe, supra, at 126. ODOL correctly argues on this point that § 165.7(B) does not prohibit the joinder of employers, but merely addresses the ability to join multiple claimants against the same employer in one claim:

'[Tlhe Commissioner may join in a single administrative proceeding any number of wage claims against the same employer,

13 ODOL further argues there is no justification for ignoring the permissive joinder statutes found at 12 0.8.2011 § 2020 17 when the labor statutes do not prohibit the joinder of employers or defendants. - Although § 165.7 does not specifically allow the joinder of employers, it also does not prohibit it. *625Holland's later amendment to include additional employers was, therefore, not prohibited.

114 The ALJ made the following finding of fact from the evidence presented:

Respondent's "GEO Exploration, LLC," "Goal Gas USA, LLC," "On Line Oil, Inc.," "Mittal Well, LLC," "Kay Kay Engineering," "Reality (sic) Management Associates, LLC," "Energy Production Service, LLC", are now and was (gic) at all times in question herein for profit business (sic) operating within the state of Oklahoma. Respondents Kris K. Agrawal and Vimala Agrawal are individuals operating these business (sic) and others for profit.

1 15 She also made this finding of fact:

At the administrative hearing ODOL called Chris Holland as its witness. Mr. Holland testified as to the work he did for the Respondents and that there was no distinction between any of the Respondents he did work for, that the Respondent corporations are all controlled by Mr. Agrawal and/or Vimala Agrawal, that Mr, Agrawal hired him and that Mr. Agrawal instructed him on what to do on a daily basis.

5 16 This finding is supported by Holland's testimony that Agrawal supervised the work he did, instructed him on his duties, and assigned him to the job sites where the work was to be done. (ODOL Trans., pp. 32-38).

T17 Next, Appellants/Employers allege error in the failure to allow them to present evidence at the ODOL Administrative hearing. The ALJ held that allowing them to do so at that time, when they had not attended the prehearing conference, would be unfair surprise to the wage claimants. In this regard, the ALJ made the following finding:

After numerous attempts at delivery of notices of both the pre-hearing conference and the administrative hearing upon the Respondents, Order Granting Leave for Bubstitutional Service was granted by ALJ Steven L. Tolson, and ODOL obtained service upon the Respondents on December 17, 2009. Claimant received notices of both the pre-hearing conference and administrative hearing on November 2, 2009, as evidenced by the signed, Return Receipt No. 7008-0150-4580-8601.

118 The question we consider, then, is whether service on the Appellants was constitutionally sufficient. We hold that it was. The record indicates that Appellants were served with notice of the wage claim proceeding through their attorney of record at the time, Raymond A. Vincent, on or about November 14, 2008, Additionally, they were each sent certified mail notice which was returned "REFUSED." Mr. Vincent filed an entry of appearance in the ODOL on December 10, 2008.

19 After the Administrative Order of Determination was filed on February 8, 2009, Mr, Vincent requested an Administrative Hearing on February 5, 2009. Service of the notice of the prehearing conference was attempted by certified mail. It was returned "unclaimed." ODOL ALJ Steven L. Tolson granted ODOL's Application for Leave of Substitutional Service on December 16, 2009.18 Thereafter, on December 17, 2009, Certificates of Hand Service were filed indicating service of the pre-hearing conference packets on Kris K. Agrawal at three different addresses (O.R. p. 425) by securely posting the notice on the premises of each location, Photographs of the posting of the securely taped envelope at each location were also provided. Although they contended they did not receive it, the ALJ found the efforts made by Holland, as well as the Board of the ODOL, were sufficient to provide them with notice and an opportunity to be heard. She refused to allow Appellants to present evidence at the hearing because they did not appear at the prehearing conference, or file their prehearing documents, i.e., witness and exhibit lists, prior to the administrative hearing. The ALJ stated:

[H]e has had sufficient notice of this proceeding for some time and chose not to avail himself of the procedures provided by law and by the administrate (gic) rules.

As such, I am going to affirm the administrative order of determination.... (ODOL Trans., p. 82)

*626 120 Again, we are convinced that the efforts to inform and serve Appellants was sufficient, and the decision by the ALJ -to prevent their submission of evidence at that late date was not an abuse of discretion. One cannot avoid service by refusing physically to accept a summons if informed that service is being attempted. Business & Professional Adjustment Co., a Division of Credit Bureau of Baker County, Oregon, Ltd. v. Baker, 62 Or. App. 237, 659 P.2d 1025 (1983). Mr. Vincent's entry of appearance on December 10, 2008, on behalf of the Agra-wals and the business entities persuades us these defendants had some knowledge of attempted service. Vincent remained the attorney of record "for the Respondents, Kris K. Agrawal, Vimala Agrawal, Geo Exploration, Coal Gas USA, LLC, On Line Oil, Inc., Mittal Well, LLC, Kay Kay Engineering and Realty Management Associates, LLC" until June 18, 2009, when he withdrew. (O.R. p. 548) We find these cirenmstances provided these defendants with knowledge of the attempts to serve them.

DISTRICT COURT APPEAL

¶21 In the district court, both Appellants filed a motion for summary judgment. Among the issues raised were Appellants' contentions that they never hired Holland, that they did not own the co-defendant companies,19 that they never received notice, and that the ALJ of the ODOL improperly refused to allow them to present evidence at the administrative hearing,. These issues were raised at the adm1mstrat1ve level in Appellants' Petition to Vacate Final Ageney Determination Due to Fraud practiced by Chris Holland, as well as on appeal in their Motion for Partial Summary Judgment against Holland, and were supported by the same evidentiary materials, The district court affirmed the ODOL's final order without comment, and nothing new was raised to warrant a modification of the judgment. °

CONCLUSION

$122 The findings and conclusions of the ALJ in the Final Agency Determination are supperted by the evidence, and the district court's order affirming it on appeal is AFFIRMED.