Bringman v. New Albertsons, Inc.

HORTON, Justice.

Appellant Billy J. Bringman (Bringman) appeals the decision of the Idaho Industrial Commission (the Commission) in favor of Respondents New Albertsons, Inc. (Albert-sons) and the Idaho Department of Labor (the Department). The Commission determined Bringman willfully made a false statement or failed to report a material fact regarding his separation from Albertsons to obtain unemployment benefits from the Department and ordered Bringman to repay the benefits he received and pay a civil penalty. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

On May 12, 2004, Bringman began his employment with Albertsons. In early October 2010, Bringman was working as an assistant store director. In accordance with Albertsons’ policy, he refused to accept a customer’s cheek without proper identification. The customer became irate and subsequently complained to Albertsons about the incident. In response to the complaint, the store director issued Bringman a written warning on October 26, 2010. Bringman refused to sign the warning because he followed company policy by refusing to accept the check without proper identification. As a result of Bringman’s refusal to sign the warning, he was immediately placed on leave.

Approximately two to three weeks later, Bringman met with a Vice-President of Human Resources at Albertsons. He was given two options: (1) resign with a severance package;1 or (2) demotion to a position in a *74different store with a significant (nearly 50%) reduction in salary. Bringman was told that if he resigned and accepted the severance package, Albertsons would not contest a claim for unemployment benefits. Bringman chose the first option.

On December 8, 2010, Bringman filed a claim for unemployment benefits with the Department. The Department’s online claim application form provided Bringman with three options to describe his separation from Albertsons: (1) quit; (2) terminated/discharged; or (3) layoff due to lack of work. Bringman selected the third option, “layoff due to lack of work.” The Department then paid unemployment insurance benefits to Bringman. Albertsons did not contest Bringman’s claim for the first year.

On December 12, 2011, Bringman filed a second claim for benefits. He again selected “layoff due to lack of work” to describe his separation from Albertsons. Upon notice of this second claim, Albertsons challenged Bringman’s eligibility for benefits.2

After conducting an investigation, the Department issued an eligibility determination on February 8, 2012, which found that (1) Bringman filed a claim for benefits with the selection “layoff due to lack of work” to describe his separation from Albertsons; (2) Albertsons and Bringman agreed that Bring-man had “quit;” and (3) Bringman “failed to provide a reasonable explanation for not providing accurate separation information.” Based on these findings, the Department determined Bringman willfully made a false statement or failed to report a material fact to obtain benefits by providing inaccurate information regarding his separation. Because Bringman willfully made a false statement or failed to report a material fact, the Department concluded he was not entitled to the benefits that he had received. Bringman requested an appeal of the eligibility determination and, on March 23, 2012, an appeals examiner affirmed the Department’s eligibility determination.

On April 5, 2012, Bringman appealed the decision to the Commission. The Commission conducted a de novo review of the record and on July 6, 2012, the Commission affirmed the appeals examiner’s decision and ordered Bringman to repay the overpayments plus a civil penalty. The Commission determined that Bringman was ineligible for a waiver of the repayment obligation because the overpayments resulted from a false statement, misrepresentation, or failure to report a material fact. Bringman timely appealed.

II! STANDARD OF REVIEW

“Whether a claimant voluntarily quit a job for good cause in connection with the employment is a question of fact to be determined by the Industrial Commission.” Ewins v. Allied Sec., 138 Idaho 343, 347, 63 P.3d 469, 473 (2003). Although this Court exercises free review over questions of law, factual findings by the Commission will be upheld when they are supported by substantial and competent evidence. Uhl v. Ballard Med. Prods., Inc., 138 Idaho 653, 657, 67 P.3d 1265, 1269 (2003). “Substantial and competent evidence is relevant evidence that a reasonable mind might accept to support a conclusion.” Id. “The conclusions reached by the Industrial Commission regarding the credibility and weight of evidence will not be disturbed unless the conclusions are clearly erroneous.” Buckham v. Idaho Elk’s Rehab. Hosp., 141 Idaho 338, 340, 109 P.3d 726, 728 (2005). “This Court will not consider reweighing the evidence or whether it would have drawn different conclusions from the evidence presented. All facts and inferences will be viewed by this Court in a light most favorable to the prevailing party before the Commission.” Current v. Haddons Fencing, Inc., 152 Idaho 10, 13, 266 P.3d 485, 488 (2011) (citation omitted).

*75III. ANALYSIS

In this appeal, we are asked to determine whether substantial and competent evidence supports the Commission’s decision that Bringman was not entitled to unemployment benefits because he willfully made a false statement or failed to report a material fact to obtain such benefits. We then consider whether Bringman is eligible for a waiver of the requirement to repay overpayments. Finally, we consider Bringman’s request for attorney’s fees on appeal.

A. There is substantial competent evidence to support the Commission’s decision that Bringman was not entitled to unemployment benefits because he willfully made a false statement or failed to report a material fact to obtain such benefits.

To obtain unemployment benefits, a claimant must provide “all necessary information pertinent to eligibility,” including the cause of his unemployment. I.C. §§ 72-1366(1), (5)-(10). To enforce this requirement, Idaho Code section 72-1366(12) provides: “A claimant shall not be entitled to benefits for a period of fifty-two (52) weeks if it is determined that he has willfully made a false statement or willfully failed to report a material fact in order to obtain benefits.” Further, the claimant is obligated to repay any benefits he received as a result of his false statement or failure to report (referred to as overpayments). I.C. §§ 72-1366(12), 72-1369(1). In such cases, the claimant also is subject to a civil penalty. I.C. §§ 72-1366(12), 72-1369(2).

The Commission determined that Bring-man was not entitled to benefits because he willfully made a false statement or failed to report a material fact when he selected “layoff due to lack of work” on his claim as his reason for his separation from Albertsons. Instead of “layoff,” the Commission determined the appropriate selection for Bring-man’s separation was “quit” and he should have selected that option.

Bringman appeals the Commission’s determination that he was not entitled to benefits under Idaho Code section 72-1366(12). He argues the Commission erred because the elements of materiality, willfulness, and falsity required by Idaho Code section 72-1366(12) were not satisfied by his selection of “layoff due to lack of work” on- his claim.

1. Bringman’s selection of “layoff due to lack of work” on his claim for benefits was material.

In Meyer v. Skyline Mobile Homes, 99 Idaho 754, 589 P.2d 89 (1979), this Court defined materiality for purposes of Idaho Code section 72-1366. We explained: “A complete and unqualified disclosure can best be promoted by defining materiality to include any information that is relevant to the determination of a claimant’s right to benefits.” Meyer, 99 Idaho at 760, 589 P.2d at 95 (emphasis added). We concluded that “a fact is material if it is relevant to the determination of a claimant’s right to benefits; it need not actually affect the outcome of that determination.” Id. In short, the test for materiality is relevance.

The reason for a claimant’s separation from his employment is relevant because separation, in part, determines the claimant’s eligibility and thus, his right to benefits. See I.C. §§ 72 — 1366(5)—(6) (eligibility requirements that the claimant’s unemployment is not due to voluntary separation without good cause, discharge for misconduct, or failure to accept suitable work without good cause). Because the reason for a claimant’s separation is relevant, it is material for purposes of Idaho Code section 72-1366(12). See Meyer, 99 Idaho at 760, 589 P.2d at 95.

Our recent decisions have reiterated that the claimant’s reason for separation from employment is material. In Current, the claimant selected “layoff due to lack of work” on the Department’s online application for a claim when the claimant actually had quit his employment due to reduced hours. 152 Idaho at 13, 266 P.3d at 488. Relying upon the Meyer definition of materiality, we affirmed the Commission’s finding that the claimant made a willful, material, and false statement to obtain benefits. Id. Likewise, in McNulty v. Sinclair Oil Corp., 152 Idaho 582, 272 P.3d 554 (2012), we again applied the Meyer definition of materiality. In McNulty, the claim*76ant failed to report his earnings and part-time employment when he filed a claim for benefits. Id. at 583, 272 P.3d at 555. After quoting the definition of materiality from Meyer, we stated:

[t]his Court finds that a claimant’s employment status is relevant to the determination of a claimant’s right to unemployment benefits. Moreover, the status of employment is material to the Department for several other reasons, including collecting information regarding the availability of jobs and the suitability of work within a particular location.

Id. at 586, 272 P.3d at 558. Although McNulty applied Meyer in the context of a claimant’s failure to report new employment, McNulty demonstrates our continued application of Meyer’s broadly inclusive definition of materiality.

Here, the reason for Bringman’s separation was relevant to the determination of his right to benefits because his separation, in part, determined his eligibility for benefits. See I.C. §§ 72 — 1366(5)—(6); Meyer, 99 Idaho at 760, 589 P.2d at 95. Thus, there was substantial and competent evidence supporting the Commission’s determination that Bringman’s selection of “layoff due to lack of work” as the explanation for his separation from Albertsons was material.

2. Substantial competent evidence supports the Commission’s finding that Bringman’s selection of “layoff due to lack of work” on his claim for benefits was false.

The evidence in the record is uncontroverted that Bringman was given the option to remain employed with Albertsons by accepting a demotion or to resign and receive a severance package, coupled with Albert-sons’ promise not to contest a claim for unemployment benefits. Bringman chose the latter.

Bringman has consistently maintained that he reported that he separated from Albertsons because of a “Layoff due to lack of work” because it was the “best fit” of his three options. The dissenting justices agree with Bringman that none of the three options adequately described the circumstances of his separation from Albertsons. In our view, the inquiry is not as to the sufficiency of the options available to Bring-man; it is whether substantial evidence supported the Commission’s finding that Bring-man’s selection was false. The term “layoff” is one of common understanding. It is commonly understood to mean “to put (an employee) out of work, esp. temporarily.” Webster’s New World Dictionary 800 (2d College ed.1976). The Commission reasonably concluded that Bringman was justified in quitting, rather than accepting a demotion and pay cut. The Commission found that Bring-man’s election to reject Albertsons’ offer of continued employment in favor of resignation and acceptance of a severance package could not fairly be labeled as a “layoff due to lack of work.” An employee’s decision to resign instead of continuing employment is a “quit,” regardless of whether the employee had good cause to do so. We find that substantial and competent evidence supports the Commission’s finding that Bringman’s selection was false.

3. Substantial competent evidence supports the Commission’s finding that Bringman’s selection of “layoff due to lack of work” on his claim for benefits was willful.

This Court has defined willfulness as “imply[ing] simply a purpose or willingness to commit the act or make the omission referred to. It does not require any intent to violate the law.” Current, 152 Idaho at 13, 266 P.3d at 488 (quoting Meyer, 99 Idaho at 761, 589 P.2d at 96). “The term ‘willfully’ refers to those claimants who ‘purposely, intentionally, consciously, or knowingly fail to report a material fact [or make a false statement], not those whose omission [or false statement] is accidental because of negligence, misunderstanding or other cause.’ ” Cox v. Hollow Leg Pub & Brewery, 144 Idaho 154, 157, 158 P.3d 930, 933 (2007) (alterations in original) (quoting Meyer, 99 Idaho at 761, 589 P.2d at 96). Applying this definition of willfulness, we have stated “a finding that a benefit claimant knew or thought it highly probable that he or she did not know what information a question solie*77ited but nevertheless deliberately chose to respond without pursuing clarification would ordinarily support a conclusion of willful falsehood or concealment.” Meyer, 99 Idaho at 762, 589 P.2d at 97; see also McNulty, 152 Idaho at 587, 272 P.3d at 559 (claimant’s failure to report was willful because he was properly informed of his reporting obligation and his alleged misunderstanding lacked credibility).

In this case, the question of willfulness turns on the Commission’s credibility determination, which this Court will not overturn unless clearly erroneous. Rigoli v. Wal-Mart Assocs., Inc., 151 Idaho 707, 712, 263 P.3d 761, 766 (2011). As the factfinder, the Commission “may consider the claimant’s explanation unworthy of belief.” Meyer, 99 Idaho at 762, 589 P.2d at 97.

The Commission identified conflicting and inconsistent testimony by Bringman regarding his separation from Albertsons. Bring-man testified that he felt “layoff due to lack of work” was the best option, he did not believe he quit, and he believed “quit” or “discharge” did not apply to his separation. However, Bringman also testified that he agreed that he was presented with the option of either continuing employment or not, he acknowledged that he was not laid off due to lack of work under the Department’s definition, and he agreed that continuing work was available. The Commission observed that Bringman did not contact the Department for clarification, even though the Department instructed claimants to report accurately and to contact the Department if they had questions. The Commission further noted the Department’s materials “expressly stated fraud included making false statements such as reporting a claimant was laid off when the claimant quit.”

After evaluating Bringman’s testimony, the Commission determined Bringman selected an option he knew was inaccurate or at least was not completely truthful. Bringman was aware Albertsons would not contest his claim and Bringman had a prior experience with filing a claim for unemployment benefits. See also McNulty, 152 Idaho at 587, 272 P.3d at 559 (considering that the claimant previously filed for benefits in discussion of claimant’s willfulness).

While we respect the views of our dissenting colleagues, their opinion strays from the standard of review that dictates our decision today. Both of our colleagues have previously authored unanimous opinions recognizing that the Commission, not this Court, is charged with the responsibility of weighing the evidence and evaluating the credibility of witnesses. See Hopkins v. Pneumotech, Inc., 152 Idaho 611, 614, 272 P.3d 1242, 1245 (2012) (J. Jones, J.); Wulff v. Sun Valley Co., 127 Idaho 71, 74, 896 P.2d 979, 982 (1995) (Schroeder, J.). Despite this, Justice Schroeder contends: “Certainly there is an element of confusion in Bringman’s testimony, but confusion and misunderstanding are not tantamount to willfully telling falsehoods.” In our view, a factfinder may view inconsistencies in a witness’ testimony as reflecting a lack of credibility. More importantly, it is not the role of this Court to decide whether a witness’ confusion and inconsistency demonstrates innocence or deceit.

Justice Schroeder complains that the Commission “apparently ignored the fact that Albertsons had already conceded the accuracy of [Bringman’s] answer a year earlier” and that “[w]eight should have been given to the fact that Albertsons did not contest this explanation for a year.” The dissent concludes:

Bringman is a victim of a corporation that punished him for following its written rules. The same corporation broke its promise not to contest his claim for benefits. He then entered the realm of bureaucratic forms and understandings uncommon to him, notwithstanding the Department’s unsupported attribution of expertise in this area to him. The Commission had hearsay information from a corporate representative and a recording, not focused examination of demeanor. It read untruthfulness into answers that appear more likely to be confusion. This is not substantial competent evidence the Court should endorse. Judicial oversight requires more.

*78It is not this Court’s role to determine that the Commission should have afforded weight to the evidence regarding Albertsons’ behavior. We hold that substantial competent evidence supported the Commission’s finding that Bringman consciously disregarded his obligation to report accurately and truthfully regarding the circumstances of his separation from employment with Albert-sons.

B. Bringman is not eligible for a waiver of the requirement to repay overpayments.

Under Idaho Code section 72-1369, a claimant must repay the benefits he received to which he was not entitled, known as overpayments. I.C. § 72-1369(1). Subsection (5) of Idaho Code section 72-1369 provides a narrow exception to this repayment requirement. In limited circumstances, such as inadvertent error by the Department unknown to the claimant, the claimant may seek a waiver of the repayment. I.C. § 72-1369(5). However, subsection (5) also expressly provides that a waiver will not be granted if the overpayment is “one resulting from a false statement, misrepresentation, or failure to report a material fact by the claimant.” Id. Thus, Idaho law bars application of the waiver when the claimant received over-payments due to a willfully false statement or failure to report a material fact under section 72-1366(12). McNulty, 152 Idaho at 588-89, 272 P.3d at 560-61.

Idaho Code section 72-1369 provides for a civil penalty in addition to the repayment obligation. Subsection (2) of Idaho Code section 72-1369 states that a claimant is subject to a civil penalty of twenty-five percent of any resulting overpayment upon a determination that “the claimant is found to have made a false statement, misrepresentation, or failed to report a material fact to the [Department.” I.C. § 72-1369(2). The civil penalty percentage increases based on the number of determinations of false statements or failures to report. Id. (fifty percent penalty for two determinations, one hundred percent penalty for three or more determinations).

The Commission determined Bring-man was not entitled to benefits because he willfully made a false statement or failed to report a material fact to obtain benefits. Therefore, the benefits were overpayments and Bringman was obligated by statute to repay them. I.C. § 72-1369(1). Bringman was ineligible for a waiver of repayment since his overpayments were “resulting from a false statement, misrepresentation, or failure to report a material fact.” I.C. § 72-1369(5). Further, Bringman was subject to a civil penalty of twenty-five percent of his resulting overpayment because he was “found to have made a false statement, misrepresentation, or failed to report a material fact to the [Department.” Id. § 72-1369(2)(a); see also McNulty, 152 Idaho at 588-90, 272 P.3d at 560-62 (claimant required to repay overpayments plus penalty because claimant willfully failed to report a material fact under section 72-1366(12)).

C. Bringman is not entitled to attorney’s fees.

Idaho Code section 12-117 governs the award of attorney’s fees. Under Idaho Code section 12-117(1), a court shall award the prevailing party reasonable attorney’s fees “if it finds that the nonprevailing' party acted without a reasonable basis in fact or law.” I.C. § 12-117(1). Bringman is not entitled to attorney’s fees because he is not the prevailing party.

IV. CONCLUSION

This Court finds that there was substantial and competent evidence to support the Commission’s finding that Bringman willfully made a false statement that was material to his application for unemployment insurance benefits. The Commission’s decision is affirmed. We award costs on appeal to the Department.

Chief Justice BURDICK and Justice EISMANN concur.

. Justice Schroeder’s dissent suggests that the only term of the severance package was Albert-sons’ broken promise not to challenge Bring-man’s claim for unemployment benefits. This is conjecture. Both Bringman and the witness from Albertsons spoke of a severance package, however, neither disclosed its terms. This is *74likely because the nature of the severance package was not at issue in the proceedings below.

. We agree with the dissenting justices that the record before this Court shows that Albertsons reneged on a promise it made to induce Bring-man's resignation. The focus of this appeal, however, is not on Albertsons' conduct; rather, our focus is on Bringman's conduct in his claim for unemployment insurance benefits. Albert-sons' exposure to liability for its change in position is outside the scope of the issues presented by this appeal.