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Correction v. Pressley

Supreme Court of Tennessee, Nashville

September 14, 2017

TENNESSEE DEPARTMENT OF CORRECTION
v.
DAVID PRESSLEY

          February 8, 2017 Session

         Appeal by Permission from the Court of Appeals Chancery Court for Davidson County No. 141380I Claudia C. Bonnyman, Chancellor

         We granted this appeal to determine whether a "preferred service" state employee has a protected property interest in his or her employment and whether due process or specific statutory language requires the State to bear the ultimate burden of proof in a post-termination administrative appeal under section 8-30-318 of the Tennessee Excellence, Accountability, and Management Act of 2012, Tenn. Code Ann. §§ 8-30-101 through -407. The Respondent, David Pressley, was employed by the Petitioner, Tennessee Department of Correction, as a correctional officer at the Morgan County Correctional Complex. Mr. Pressley was dismissed from his employment and challenged his termination pursuant to the TEAM Act's appeals process. Mr. Pressley's termination was upheld by the Commissioner of TDOC at Step I of the TEAM Act's appeals process and at Step II by the Commissioner of Human Resources. At Step III of the appeals process, the Board of Appeals reinstated Mr. Pressley and reduced his discipline to a 14-day suspension. The Board of Appeals also determined that the State bore the ultimate burden of proof in the Step III appeal. The State appealed to chancery court, challenging the assignment of the burden of proof. The chancery court reversed the Board of Appeals' decision on the burden of proof issue and remanded the matter to the Board of Appeals. Mr. Pressley appealed to the Court of Appeals which, in turn, reversed the chancery court's decision and determined that "preferred service" state employees have a protected property interest in their employment and that the State bore the ultimate burden of proof in the Step III appeal. We reverse the Court of Appeals' judgment and remand this matter to the Board of Appeals for further proceedings consistent with this Opinion.

         Tenn. R. App. P. 11 Appeal by Permission; Judgment of the Court of Appeals Reversed; Remanded to the Board of Appeals

          Herbert H. Slatery III, Attorney General and Reporter; Andrée Sophia Blumstein, Solicitor General; Ann M. Mikkelsen, Assistant Attorney General; and Joseph F. Whalen, Associate Solicitor General, for the appellant, Tennessee Department of Correction.

          Frank J. Scanlon and Samuel P. Helmbrecht, Nashville, Tennessee, for the appellee, David Pressley.

          Jeffrey S. Bivins, C.J., delivered the opinion of the court, in which Cornelia A. Clark, Sharon G. Lee, Holly Kirby, and Roger A. Page, JJ., joined.

          OPINION

          JEFFREY S. BIVINS, CHIEF JUSTICE

         Factual and Procedural Background

         The Respondent, David Pressley ("Mr. Pressley"), was employed by the Petitioner, Tennessee Department of Correction ("TDOC" or "the State"), beginning in November of 2011 as a correctional officer at the Morgan County Correctional Complex ("MCCX" or "the prison"). On January 8, 2014, Mr. Pressley received a letter from the prison warden (the "Warden") notifying him that he had been dismissed from his employment. The letter alleged that on the night of January 6, 2014, and the morning of January 7, 2014, video surveillance cameras showed that Mr. Pressley allowed inmates to pilfer large amounts of food from the prison kitchen, prepare some of the food, and leave the kitchen area with large quantities of food while he was supervising the cleaning of the prison kitchen. The letter also alleged that Mr. Pressley wrongfully accessed a secure food storage area secured by a tamper seal. The letter charged that this alleged conduct violated "MCCX Service/Dining Room-Security Post Orders" ("Post Orders") and Department of Human Resources Rules pertaining to "incompetency" and "negligence" in the performance of duties and conduct unbecoming an employee in state service. The letter stated that Mr. Pressley's employment would be terminated effective January 17, 2014, and that, as a preferred service employee, Mr. Pressley had the right to file a written complaint challenging his dismissal.

         Pursuant to the Tennessee Excellence, Accountability, and Management Act of 2012 (the "TEAM Act" or the "Act"), discussed in detail below, Mr. Pressley initiated a Step I review challenging his dismissal by filing a complaint with the Commissioner of TDOC. The complaint specifically alleged that "[t]he department did not have cause to take such action." By letter dated February 3, 2014, the Commissioner of TDOC, Derrick D. Schofield, upheld Mr. Pressley's termination. On or about February 12, 2014, Mr. Pressley filed a request for a Step II review. On March 10, 2014, the Commissioner of Human Resources (the "Commissioner"), Rebecca R. Hunter, upheld Mr. Pressley's dismissal at his Step II review, finding no "violation by the Department [of Correction] due to [Mr. Pressley's] failure to demonstrate how the Department [of Correction] violated [Tennessee Code Annotated Section 8-30-316]."

         Following his failure to obtain relief at his Step II review, Mr. Pressley initiated a Step III review by filing an appeal with the Board of Appeals ("the Board"). In the appeal, he argued that there was no cause for his termination and that his termination represented too severe a punishment for his alleged conduct. In an order dated March 21, 2014, the chief administrative law judge preliminarily assigned the burden of proof to TDOC pursuant to Tennessee Rules & Regulations 1360-04-01-.02(3) & (7) (2004) of the Uniform Rules of Procedure for Hearing Contested Cases before Administrative Agencies. The order indicated that if either party wished to contest the determination regarding the burden of proof, it could do so by filing a written brief and memorandum. TDOC filed a written brief and memorandum, arguing that the ultimate burden of proof should be placed on Mr. Pressley because he was the moving party. Mr. Pressley responded in opposition, and the chief administrative law judge ruled at a pre-hearing conference that the issue of burden of proof would be decided by the administrative law judge ("ALJ") who was ultimately assigned to hear the case.

         Mr. Pressley's appeal proceeded to a contested hearing on June 23 and August 8, 2014, before the Board. During the hearing, the ALJ presiding over the case upheld the prior ALJ's order assigning the burden of proof to TDOC. After the conclusion of the hearing, the Board issued a final ruling containing detailed findings of fact and conclusions of law. In summary, the Board found that TDOC had failed to carry its burden of proof on all but one alleged act of misconduct. Specifically, the Board found that Mr. Pressley had obtained advance permission from his supervisor to take food from the secure storage area in order to prepare meals for the third shift that evening. Additionally, the Board found that there was not sufficient evidence that Mr. Pressley broke tamper seals to enter the secure food storage area to support his dismissal.

         The Board likewise determined that two correctional officers assigned to search the inmates upon the inmates' return to the housing unit found no contraband, food or otherwise, on the inmates Mr. Pressley had been supervising in the kitchen. Accordingly, the Board concluded that TDOC had failed to meet its burden to demonstrate Mr. Pressley had committed a violation of the Post Orders or Tennessee Department of Human Resources Rule 1120.10-.03(2) concerning incompetence. The Board, however, found that TDOC carried its burden of proof with regard to Tennessee Department of Human Resources Rule 1120.10-.03(3) "negligence in the performance of duty, " by establishing that Mr. Pressley had failed to file a written report after going into the secure food storage area. Consequently, the Board issued Mr. Pressley a fourteen-day suspension without pay. The Board denied Mr. Pressley's request for attorney's fees.

         Both the State and Mr. Pressley filed petitions for judicial review in the chancery court. For its part, the State argued that the ALJ improperly placed the burden of proof on TDOC in Mr. Pressley's Step III appeal, while Mr. Pressley countered that any punishment was not supported by the evidence adduced before the Board. The two cases were consolidated, and the chancery court ultimately entered an order vacating the Board of Appeals' decision, determining that the ALJ advising the Board of Appeals made an erroneous assignment of the burden of proof during Mr. Pressley's Step III appeal. Accordingly, the chancery court vacated the Board's decision and remanded the case to the Board to apply the burden of proof in the appropriate manner.

         Mr. Pressley appealed the chancery court decision to the Tennessee Court of Appeals. The Court of Appeals reversed the chancery court's decision on the allocation of the burden of proof and determined that the State, rather than Mr. Pressley, had the ultimate burden to show cause to sustain the dismissal or suspension of an employee in a Step III appeal pursuant to Tennessee Code Annotated section 8-30-318. Tenn. Dep't of Corr. v. Pressley, M2016-00902-COA-R3-CV, 2016 WL 1559138, at *14 (Tenn. Ct. App. Apr. 14, 2016), appeal granted (Sept. 23, 2016). The Court of Appeals reached this decision based upon its conclusion that preferred service employees under the TEAM Act have a protected property interest in their continued employment. Id. at *12. The Court of Appeals reasoned that, if a preferred service employee has a protected property interest in continued employment, the preferred service employee possesses due process rights that must be protected. Id. at *14. The Court of Appeals then ultimately concluded that the due process protections enjoyed by a preferred service employee required that the State bear the burden of proof at Step III of the TEAM Act's appeals process.[1] Id. Thus, the Court of Appeals held that the Board did not err in requiring the State to prove that there was sufficient evidence for Mr. Pressley's termination and sufficient evidence that the Board's punishment was appropriate. Id. at *15.

         As to Mr. Pressley's appeal, the Court of Appeals also concluded that the Board erred in imposing any discipline on Mr. Pressley because of a lack of substantial and material evidence in the record to support the Board's conclusion that Mr. Pressley committed negligence in failing to file an incident report on the night of January 6, 2014. Id. at *17. Finally, the Court of Appeals determined that Mr. Pressley was entitled to attorney's fees as the "successfully appealing employee" before the Board of Appeals. Id. at *19. Accordingly, the Court of Appeals reversed the chancery court's judgment in all respects and remanded the case to the chancery court for a determination of Mr. Pressley's reasonable attorney's fees pursuant to Tennessee Code Annotated section 8-30-318(k). Id.

         We granted the State permission to appeal to address the question of whether a preferred service employee has a protected property interest in his or her employment under the TEAM Act. If we answer that question in the negative, we then address the issue of whether the language of the TEAM Act itself requires that the State bear the ultimate burden of proof in a post-termination administrative appeal under the TEAM Act. For the reasons stated below, we hold that Mr. Pressley and other similarly situated preferred service employees do not possess a protected property interest in their employment with the State. We also conclude that Mr. Pressley bore the ultimate burden of proof at his Step III hearing. Accordingly, we reverse the judgment of the Court of Appeals and remand this case to the Board for further proceedings consistent with this Opinion.

         DISCUSSION

         Standard of Review

         Under the TEAM Act, Board of Appeals' decisions are subject to judicial review in accordance with the Uniform Administrative Procedures Act ("UAPA"). Tenn. Code Ann. § 8-30-318(j) (2016). Therefore, this Court, as well as the trial and intermediate appellate courts, reviews the Board's decision under the narrowly defined standard of review contained in the UAPA, Tenn. Code Ann. § 4-5-322(h) (2015 & Supp. 2016), rather than under the broad standard of review used in other civil appeals, Davis v. Shelby Cnty. Sheriff's Dep't., 278 S.W.3d 256, 263-64 (Tenn. 2009). Accordingly, pursuant to Tennessee Code Annotated section 4-5-322:

The court may reverse or modify the decision if the rights of the petitioner have been prejudiced because the administrative findings, inferences, conclusions or decisions are:
(1) In violation of constitutional or statutory provisions;
(2) In excess of the statutory authority of the agency;
(3) Made upon unlawful procedure;
(4) Arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion; or
(5) (A) Unsupported by evidence that is both substantial and material in the light of the entire record.
(B) In determining the substantiality of evidence, the court shall take into account whatever in the record fairly detracts from its weight, but the court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact.

         Tenn. Code Ann. § 4-5-322(h). Applying this standard of review, a reviewing court may reverse the Board's decision only if one or more of the five enumerated grounds for reversal are present. Id.; Davis, 278 S.W.3d at 264.

         This case also involves the application and interpretation of the TEAM Act. Issues of statutory interpretation and the application of a statute to the facts of a case are determinations involving questions of law and are reviewed under a de novo standard with no presumption of correctness afforded to either the trial court or intermediate court of appeals. State v. Sherman, 266 S.W.3d 395, 401 (Tenn. 2008). We independently construe the relevant provisions of the TEAM Act without deference to the interpretations made by TDOC, the chancery court, or the Court of Appeals. See In re Kaliyah S., 455 S.W.3d 533, 552 (Tenn. 2015).

         "When engaging in statutory interpretation, 'well-defined precepts apply.'" State v. Howard, 504 S.W.3d 260, 269 (Tenn. 2016) (quoting State v. McNack, 356 S.W.3d 906, 908 (Tenn. 2011)). "The most basic principle of statutory construction is to ascertain and give effect to the legislative intent without unduly restricting or expanding a statute's coverage beyond its intended scope." Id. (citing Owens v. State, 908 S.W.2d 923, 926 (Tenn. 1995)). The text of the statute is of primary importance. Mills v. Fulmarque, Inc., 360 S.W.3d 362, 368 (Tenn. 2012). When a statute is ambiguous, we may reference the broader statutory scheme, the history of the legislation, or other sources. Sherman, 266 S.W.3d at 401 (citing Parks v. Tenn. Mun. League Risk Mgmt. Pool, 974 S.W.2d ...


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