                                 NO. COA13-452

                       NORTH CAROLINA COURT OF APPEALS

                             Filed: 21 January 2014


CYNTHIA A. BAILEY,

     Petitioner,

     v.                                     Buncombe County
                                            No. 12 CVS 05163
DIVISION OF EMPLOYMENT SECURITY,
NORTH CAROLINA DEPARTMENT OF
COMMERCE,

     Respondent.


    Appeal by respondent from order entered 14 January 2013 by

Judge C. Philip Ginn in Buncombe County Superior Court.           Heard in

the Court of Appeals 26 September 2013.


    Adams Hendon Carson Crow & Saenger, P.A., by John C. Hunter,
    for petitioner-appellee.

    North Carolina Department of Commerce, Division of Employment
    Security, by Timothy M. Melton, for respondent-appellant.


    STEELMAN, Judge.


    Where the trial court adopted all of the findings of fact

made by DOC, which as a matter of law supported DOC’s ruling that

petitioner   engaged    in    misconduct,   the   trial   court   erred   in

reversing the decision of DOC.
                                -2-
              I. Factual and Procedural Background

     Cynthia A. Bailey (plaintiff) was employed by Pro Temps

Medical Staffing (Pro Temps).    On 11 December 2011, plaintiff’s

employment with Pro Temps was terminated.      On 1 January 2012,

plaintiff filed a claim for unemployment benefits.   An Adjudicator

found that plaintiff was assigned to monitor a patient who was on

suicide watch; that plaintiff was found sleeping on the job; and

that plaintiff was discharged due to this misconduct and was

disqualified from receiving unemployment benefits.      On 2 April

2012, plaintiff appealed pro se to the Appeals Referee.

     On 1 May 2012, the Appeals Referee heard the appeal.      The

Appeals Referee affirmed the Adjudicator’s determination, and held

that plaintiff was discharged due to misconduct, and therefore was

disqualified from receiving unemployment benefits.     The Appeals

Referee further found that while plaintiff was sleeping, the

suicide-watch patient had been wandering the halls of the hospital.

On 31 May 2012, plaintiff appealed pro se to the North Carolina

Department of Commerce, Division of Employment Security (DOC).

     On 26 September 2012, DOC adopted the facts found by the

Appeals Referee, concluded that the Appeals Referee correctly

applied the law, and affirmed the decision that plaintiff was

disqualified from receiving unemployment benefits.   On 26 October
                                  -3-
2012, plaintiff     filed a petition for judicial review to the

Superior Court of Buncombe County.

     On 15 January 2013, the trial court entered its order on

judicial review, and held that plaintiff was not disqualified to

receive unemployment benefits.

     DOC appeals.

                       II. Standard of Review

     “In cases appealed from administrative tribunals, we review

questions of law de novo and questions of fact under the whole

record test.” Diaz v. Div. of Soc. Servs., 360 N.C. 384, 386, 628

S.E.2d 1, 2 (2006).    A determination that an employee has engaged

in misconduct under N.C. Gen. Stat. §§ 96-14 and 96-15 is a

conclusion of law.    See e.g.   Williams v. Burlington Indus., Inc.,

318 N.C. 441, 456, 349 S.E.2d 842, 851 (1986) (referring to “the

referee's    conclusion   that    petitioner    was   discharged   for

misconduct”).

            [I]n cases appealed from an administrative
            tribunal under [Article 3 of North Carolina’s
            Administrative Procedure Act], it is well
            settled that the trial court’s erroneous
            application of the standard of review does not
            automatically necessitate remand, provided
            the appellate court can reasonably determine
            from the record whether the petitioner’s
            asserted grounds for challenging the agency’s
            final    decision    warrant    reversal    or
            modification of that decision under the
            applicable provisions of N.C.G.S. § 150B-
                                 -4-
            51(b).

N.C. Dep’t of Env’t & Natural Res. v. Carroll, 358 N.C. 649, 665,

599 S.E.2d 888, 898 (2004).

            When the issue on appeal is whether a state
            agency erred in interpreting a statutory term,
            an appellate court may freely substitute its
            judgment for that of the agency and employ de
            novo review. Although the interpretation of a
            statute by an agency created to administer
            that statute is traditionally accorded some
            deference   by    appellate   courts,    those
            interpretations are not binding. The weight of
            such [an interpretation] in a particular case
            will depend upon the thoroughness evident in
            its consideration, the validity of its
            reasoning, its consistency with earlier and
            later pronouncements, and all those factors
            which give it power to persuade, if lacking
            power to control.

N.C. Sav. & Loan League v. N.C. Credit Union Comm’n, 302 N.C. 458,

465-66, 276 S.E.2d 404, 410 (1981) (citations and quotations

omitted).

                II. Trial Court’s Standard of Review

     In its first argument, DOC contends that the trial court

disregarded the standard of review set out in N.C. Gen. Stat. §

96-15(i).    We agree.

     N.C. Gen. Stat. § 96-15, concerning the procedure as to claims

for unemployment benefits, provides that, in any judicial review

of a decision by DOC:

            the findings of fact by the Division, if there
                               -5-
         is any competent evidence to support them and
         in the absence of fraud, shall be conclusive,
         and the jurisdiction of the court shall be
         confined to questions of law. Such actions and
         the questions so certified shall be heard in
         a summary manner and shall be given precedence
         over all civil cases.

N.C. Gen. Stat. § 96-15(i) (2013).

    In the instant case, the Appeals Referee found that:

         3.   According to the employer's policies and
         procedures, of which the claimant knew or
         should have known, if an employee is found to
         be asleep or giving off the appearance of
         sleep while he/she is supposed to be
         performing job duties, then said employee may
         be subjected to an immediate discharge from
         employment.

         4.   On   the   claimant's    final   day   of
         employment, she [claimant] was found asleep in
         a patient's room. The claimant was supposed to
         be providing sitter duties for said patient.

         5.   The above-mentioned patient was on
         "suicide watch" and left the room while the
         claimant was asleep.

         6.   A nurse woke up the claimant and informed
         her [claimant] that the patient she was to be
         watching over was outside of his room at the
         nurses' station.

         7. The claimant was discharged from this job
         for sleeping during her work shift while she
         was supposed to be performing her job duties.

    The Appeals Referee concluded that:

         the claimant fell asleep while she was
         supposed to be watching over a patient as a
         certified   nursing  assistant/sitter.  The
                                       -6-
              employer's policies allow for an employee to
              turn down patients and/or shifts if he or she
              thinks it would not be prudent or possible to
              perform job duties whether that decision is
              based on one's comfort level or level of
              fatigue. The claimant did not turn down
              providing sitting duties for the above-noted
              patient during her agreed to work shift. The
              claimant's actions were a willful disregard of
              the employer's interests and a disregard of
              the standards of behavior that the employer
              rightfully expected of the claimant. As such,
              the claimant was discharged for misconduct in
              connection with the work.

       On appeal from the Appeals Referee, DOC held that:

              As the ultimate fact-finder in cases involving
              contested claims for unemployment insurance
              benefits, the undersigned concludes that the
              facts found by the Appeals Referee were based
              on competent evidence and adopts them as its
              own. The undersigned also concludes that the
              Appeals Referee properly and correctly applied
              the Employment Security Law (G.S. §96-1 et
              seq.) to the facts as found, and the resultant
              decision was in accordance with the law and
              fact.

       On appeal from DOC, the trial court found simply that “There

is competent evidence in the record to support the findings of

fact   made    by   the   Division.”     However,   the   trial   court   then

concluded that plaintiff’s conduct was not “misconduct” which

would merit disqualification, holding:

              The Division's conclusion of law as set out in
              the Memorandum of Law Section of the
              Division's Decision is in error as a matter of
              law in that Petitioner's actions were not,
              "conduct   evincing  a   willful   or   wanton
                               -7-
          disregard of the employer's interest as is
          found   in  the   deliberate   violations   or
          disregard of standards of behavior which an
          employer has a right to expect of an employee
          or has been explained orally or in writing to
          an employee or conduct evincing carelessness
          or negligence of such degree or recurrence as
          to manifest an intentional and substantial
          disregard of the employer's interest or of the
          employee's duties or obligations to the
          employer,"    and   were    not,    therefore,
          "misconduct" as that term is defined and used
          in N.C. Gen. Stat. § 96-14(2).

     N.C. Gen. Stat. § 96-14 defines misconduct as:

          intentional   acts  or   omissions  evincing
          disregard of an employer's interest or
          standards of behavior which the employer has
          a right to expect or has explained orally or
          in writing to an employee or evincing
          carelessness or negligence of such degree as
          to manifest equal disregard.

N.C. Gen. Stat. § 96-14(2) (2011)1.

     The findings of fact of the Appeals Referee were adopted by

DOC, and in turn by the trial court upon appeal.   These findings

explicitly stated that Pro Temps had a policy that employees found

sleeping were subject to immediate discharge, and that employees

who believed themselves unable to perform had the option to turn

down patients or shifts, and that plaintiff knew or should have



1 N.C. Gen. Stat. § 96-14 was repealed by Session Laws 2013-2,
s.2(a), effective 1 July 2013, and replaced by N.C. Gen. Stat. §
96-14.1 et seq.     However, § 96-14 was effective during the
proceedings before the trial court, and we will therefore apply
the definition expressed therein.
                               -8-
known about these policies.   Further, these findings stated that

plaintiff was found sleeping when she had been assigned to a

patient on suicide watch, having chosen not to turn down the shift.

These findings all support the conclusion that plaintiff had

engaged in misconduct, and do not support a conclusion to the

contrary.

     Nonetheless, the trial court, despite adopting these findings

in their entirety, concluded that no misconduct had occurred.   Its

conclusion is in direct contradiction to the findings it adopted,

and is therefore without a basis in the law.

     We hold that the trial court erred as a matter of law in

making conclusions of law which were not supported by its findings

of fact, and reverse and remand this matter to the trial court for

entry of an order affirming the decision of DOC.

                       III. Other Arguments

     Because we have held that the trial court erred as a matter

of law in reversing the decision of DOC, we need not address DOC’s

other arguments.

     REVERSED AND REMANDED.

     Judges HUNTER, ROBERT C. and BRYANT concur.
