Jordan v. Dukes , 269 Ark. 581 ( 1980 )

David Newbern, Judge.

Appellee Dukes was accused of setting off fireworks in the appellant’s plant where Dukes worked as a welder. Dukes was discharged, and he was denied unemployment compensation benefits because it was found by the referee he had been discharged for misconduct Ark. Stat. Ann. § 81-1106(b)(2) (Repl. 1976). The board of review reversed, finding Dukes was discharged for reasons other than misconduct.

The evidence before the referee was a swearing match between a company supervisor and Dukes and some of his fellow workers. The supervisor’s statement was that, from a concealed position, he saw an employee named Walker hand some items wrapped ,in brightly colored paper to Dukes and that he then saw Dukes light a fuse and throw some fireworks into the air. The supervisor was not present at the hearing, but his signed statement was accepted into evidence. Statements by other employees were also entered, each saying he had no knowledge that Dukes shot fireworks in the plant. Some identified themselves as persons who worked in the same area of the plant as Dukes.

Walker, the employee who allegedly handed the fireworks to Dukes did not testify, and no statement from him was entered. The referee made a point of questioning Dukes as to why he had no testimony from Walker.

After the hearing, based upon which the referee held for the appellant, Brown Jordan, Dukes appealed to the board of review and sent to the board a statement signed by Walker saying he had given no fireworks to Dukes. The board then reversed. The appellant had no knowledge of the Walker statement until it received the board’s decision.

The only point asserted for reversal is that the appellant was denied due process when the board considered a statement not in evidence before the referee and as to which the appellant had neither notice nor opportunity to rebut.

The appellees cite the following portion of Ark. Stat. Ann. § 81-1107(d)(4) (RepL 1976):

Procedure. The Board of Review, appeal tribunals and special examiners shall not be bound by common law or statutory rules of evidence or by technical rules of procedure, but any heraing or appeal before such tribunals shall be conducted in such manner as to ascertain the substantial rights of the parties.

The statute also provides:

Upon review on its own motion or upon appeal, the Board may on the basis of the evidence previously submitted in such case, or upon the basis of such additional evidence as it may direct be taken, affirm, modify or reverse the findings and conclusions of the appeal tribunal. [Ark. Star. Ann. § 81-1107(d)(3) (Repl. Í976)]

It is clear to us the statute does not permit the board to consider evidence of which a party has not been apprised. This “additional evidence” was not “previously submitted.” We interpret “previously submitted” to mean submitted in some previous hearing at which either party would have an opportunity to question or support it. Neither did the board “direct [it] be taken.” The statement in question here was just sent to the board by a party without invitation by the board or notice to the appellant. This failure to comply with the statute makes it unnecessary to get to the obvious due process deprivation which occurred in this case.

The appellees argue this was harmless error because there is substantial evidence of record, even excluding Walker’s statement, to support the decision. We cannot agree the error was harmless, as the board of review emphasized that very statement in its determination in favor of the appellee Dukes. The relaxation of the rules of evidence in administrative agency determinations does not permit an agency to ignore its statutory limits or fundamental fairness. Our supreme court has determined error occurred when an administrative agency failed to give a party adequate time to obtain rebuttal evidence. Pub. Service Comm’n v. Continental Tel. Co., 262 Ark. 821, 561 S.W. 2d 645 (1978). The error in considering evidence of which a party had no notice is, of course, far more egregious.

The board of review’s decision is reversed, and the case is remanded for the taking of further evidence, including that of Jimmy Walker, which either party may wish to submit, assuring that notice of any further evidence to be considered is given to each party.

Howard, J., dissents.