NO. 94-201
IN THE SUPREME COURT OF THE STATE OF MONTANA
1994
DEBRA STINE,
Petitioner and Appellant,
-vs-
WESTERN FEDERAL SAVINGS BANK,
MONTANA DEPARTMENT OF LABOR AND
INDUSTRY, and the MONTANA BOARD
OF LABOR APPEALS,
Respondents and Respondents.
APPEAL FROM: District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable Ed McLean, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Larry W. Jones, Attorney at Law, Missoula,
Montana
For Respondents:
Ronald A. Bender; Worden, Thane & Haines,,
Missoula, Montana (forwestern Federal Savings Bank)
Robert J. Campbell, Special Assistant Attorney
General, Helena, Montana (for Department of Labor
and Industry and Board of Labor Appeals)
Submitted on Briefs: July 26, 1994
Decided: August 16, 1994
Filed:
Justice Karla M. Gray delivered the Opinion of the Court.
Debra Stine appeals from an order of the Fourth Judicial
District Court, Missoula County, affirming the Board of Labor
Appeals' determination that she was disqualified from receiving
unemployment insurance benefits based on employee misconduct. We
affirm.
Ms. Stine was employed by the Western Federal Savings Bank of
Montana (Western Federal) from August 27, 1979, to January 13,
1993. During all times pertinent to this action, Western Federal
had in place an overdraft policy which required employees to
maintain a positive balance in any Western Federal account. In
the event of an overdraft, employees were required to bring the
account to a positive balance by the following business day. If
the account were overdrawn three days within any given month, the
employee's supervisor would be contacted and a reprimand placed in
the employee's personnel file. Finally, the policy provided that
additional disciplinary action may be taken if the employee fails
to maintain the account in a professional manner.
MS. Stine's problems with her account began in June of 1991,
when her balance fell below zero on June 3, 4andll. I n
accordance with the overdraft policy she was given a letter of
reprimand. The letter instructed Ms. Stine, to "refer to the
attached checking policy copied from your employment manual," and
to read, sign, date and return the letter. Ms. Stine wrote a note
on the bottom of the letter indicating that her failure to keep
track of her deposits and withdrawals was the result of being "sick
with lupus."
The second incident occurred in September of 1992, when MS.
Stine's account showed a negative balance on September 2, 8 and 9.
In this instance, Ms. Stine's supervisor photocopied Western
Federal's policy on overdrafts and added a handwritten note at the
bottom indicating that "if any more overdrafts occur additional
disciplinary action may be taken which could include termination."
Ms. Stine read and signed this photocopy, including the handwritten
note: the photocopy was then placed in her personnel file. Ms.
Stine did not mention a medical problem to her supervisor during
this incident.
The final incident occurred in January of 1993, when Ms. Stine
carried a negative balance on January 5, 6 and 11. She received a
written reprimand in the form of a memorandum stating that Western
Federal was considering termination based on her failure to
properly maintain the account. Ms. Stine responded with a
handwritten explanation that she had failed in her recordkeeping.
No medical excuse or justification was mentioned. on January 13,
1993, Western Federal terminated Ms. Stine's employment after she
failed to remedy the negative balance as required by the policy and
further overdrafts occurred on January 12 and 13.
Following her termination, Ms. Stine filed a claim for
unemployment insurance benefits with the Unemployment Insurance
Division of the Department of Labor and Industry (Department). A
claims specialist determined that she was disqualified from
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receiving benefits because she was discharged for cause associated
with her violation of the overdraft policy. Her request for
redetermination was denied. Following procedural difficulties not
at issue here, Ms. Stine's claim was scheduled for a hearing on
appeal before a Department referee.
The referee ultimately affirmed the determination, finding
that Ms. Stine had been discharged for failure to comply with
Western Federal's policy on overdrafts and that her actions
constituted misconduct under § 39-51-2303, MCA. The referee
further found that Ms. Stine's assertion that the account
overdrafts were the result of a medical condition was not supported
by the record.
MS. Stine appealed to the Board of Labor Appeals (Board)
which, failing to find any substantial evidence to warrant
modification or reversal, adopted the referee's findings of fact
and decision. On judicial review, the District Court affirmed the
Board's decision. Ms. Stine appeals.
The issue before us is whether the District Court erred in
determining that substantial evidence supports the Board's findings
of fact.
A district court's review of a decision of the Board of Labor
Appeals is limited by 5 39-51-2410(5), MCA, which provides:
In any judicial proceeding under 39-51-2406 through 39-
51-2410, the findings of the board as to the facts, if
supported by evidence and in the absence of fraud, shall
be conclusive and the jurisdiction of said court shall be
confined to questions of law.
A finding is supported by evidence if it is supported by
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substantial evidence. Substantial evidence is more than a
scintilla of evidence, but it may be less than a preponderance of
the evidence. Reynolds v. Pacific Telecom, Inc. (1993), 259 Mont.
309, 314, 856 P.2d 1365, 1368. Under 5 39-51-2410(5), MCA, a
district court is not permitted to balance conflicting evidence in
support of and in opposition to the Board's findings, determine
which is the more substantial evidence, or consider where the
preponderance of the evidence lies: to do so would substitute the
district court's view of the evidence for that of the Board,
effectively nullifying the conclusive nature of the Board's
findings. Reynolds, 856 P.2d at 1368.
This Court's review of the Board's findings is governed by the
same standard. Zimmer-Jackson v. Dept. of Labor (1988), 231 Mont.
357, 360, 752 P.2d 1095, 1098. Therefore, we review the record to
determine whether substantial evidence supports the Board's
findings.
Ms. Stine challenges the Board's general finding that her
failure to maintain her account, under these circumstances,
amounted to misconduct which disqualifies her from receiving
unemployment benefits. Specifically, the Board found that "the
claimant's actions must be interpreted as a deliberate, intentional
or wanton disregard of the employer's interest or of the standards
of behavior the employer has the right to expect of an employee."
In Montana, an employee may be disqualified for unemployment
insurance benefits after discharge for "misconduct connected with
the individuals's work or affecting the individual's employment."
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Section 39-51-2303(l), MCA. Misconduct, as defined by §
24.11.460(l), ARM, includes conduct by the claimant evincing:
(a) willful or wanton disregard of the rights, title, and
interests of a fellow employee or the employer; (b)
deliberate violations or disregard of standards of
behavior which the employer has the right to expect of an
employee; (c) carelessness or negligence that causes or
would likely cause serious bodily harm to the employer or
fellow employee: or (d) carelessness or negligence in
such a degree as to show an intentional or substantial
disregard for the employer's interest.
In addition, 5 24.11.461(f), ARM, provides that violation of a
company rule may, if the rule is reasonable and the claimant knew
or should have known of the existence of the rule, be considered
misconduct because it signifies a willful and wanton disregard of
the rights, title and interests of the employer or a fellow
employee. In this regard, Ms. Stine's reliance on Connolly v.
Montana Bd. of Labor Appeals (1987), 226 Mont. 201, 734 P.Zd 1211,
for this Court's definition of what constitutes misconduct under §
39-51-2303, MCA, is misplaced. Connolly was decided prior to the
1988 promulgation of the definitional regulations implementing g
39-51-2303, MCA. These regulations became effective, January 1,
1989, were relied on by the Board and the District Court in this
case, and have not been challenged here.
Ms. Stine testified that she was aware of Western Federal's
policy regarding overdrafts on employee accounts and, in fact,
issued numerous overdrafts leading to three reprimands by Western
Federal. Her own testimony provides ample support for the Board's
finding that her conduct constituted a deliberate disregard of the
employer's interest or of the standards of behavior the employer
6
has the right to expect of an employee.
Ms. Stine argues, however, that an ongoing medical condition
prevented her from complying with the overdraft policy. She
contends that her actions are not intentional or deliberate and do
not rise to the level of misconduct we have required in order to
disqualify a person from receiving unemployment insurance benefits.
In LaVe v. Dept. of Labor & Industry (1989), 239 Mont. 339,
780 P.2d 189, we considered whether negligent failure to replace
oil in the crankcase of a customer's automobile constituted
"misconductUt under Montana law. We determined that the employee's
single act of negligence did not manifest sufficient disregard of
the employer's interest to constitute misconduct. -,
LaVe 780 P.2d
at 192. Contrasting the situation in LaVe with her own conduct,
Ms. Stine argues that because her actions resulted from a medical
condition over which she has little, if any, control, they do not
even rise to the level of negligence in u.
In this latter regard, the record reflects that Ms. Stine did
not advise Western Federal that her medical problems caused the
September 1992, and January 1993 incidents: nor would she offer any
explanation for the increased activity in her checking account in
December of 1992, and January of 1993, which led to her numerous
overdrafts. This record led to the referee's determination that
MS. Stine had failed to establish that her repeated violations of
Western Federal's policy were the result of her medical condition.
Moreover, &&& provides no support for Ms. Stine. It
concerned a situation where the employee had engaged in a single
7
negligent act. LaVe
-0 780 P.2d at 192. Here, Ms. Stine repeatedly
violated Western Federal's overdraft policy.
Ms. Stine also argues that Western Federal's post-termination
payment of severance benefits demonstrates that her conduct was not
intentional and, therefore, does not rise to the level of
misconduct. This argument and, indeed, Western Federal's payment
of severance benefits are irrelevant to the issue before us.
Western Federal's policy on severance pay did not require payment
of severance benefits to Ms. Stine, and its willingness to provide
these benefits based on Ms. Stine's length of service does not
relate to our review of the Board's decision.
We conclude that substantial evidence supports the Board's
finding that Ms. Stine's repeated violation of the overdraft policy
manifests a deliberate, intentional or wanton disregard of the
employer's interest or of the standards of behavior the employer
has the right to expect of an employee. We hold, therefore, that
the District Court did not err in affirming the Board's findings.
Affirmed. i !
We concur:
Chief Justice
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