Levitz Furniture Corp. v. Prince George's County

BLOOM, Judge. The Prince George’s County Human Relations Commission (Commission) found that appellant, Levitz Furniture Corporation (Levitz), had been guilty of racial discrimination when it fired a black employee, appellee Willie Parks, Jr. The Commission ordered Levitz to cease and desist from enforcing personnel policies in a racially discriminatory manner and to reinstate Parks with back pay of $48,249.96. When Levitz did not promptly comply with that order, Prince George's County, on behalf of the Commission, and Parks brought an action against Levitz, in the Circuit Court for Prince George’s County, to enforce the Commission’s order. Levitz then filed in the circuit court a direct appeal from the Commission’s order and moved to consolidate the two actions.

After granting the motion to consolidate, the court affirmed the Commission, and Levitz noted a timely appeal to this Court. The County and Parks, who had challenged Levitz’s right to appeal to the circuit court, filed a cross-appeal to preserve that issue. They have also ¹⁰⁶ moved to dismiss Levitz’s appeal, asserting that we have no jurisdiction to entertain it. For reasons which are set forth below, we shall deny appellees’ motion to dismiss, and we shall reverse the judgment of the circuit court.

Facts On 26 November 1982, appellee Parks filed a complaint with the Prince George’s County Human Relations Commission, alleging that he had been discharged from his employment as a sales associate with Levitz as a result of racial discrimination. Levitz denied the allegation and asserted, in response, that Parks was terminated on the basis of his poor performance on the job. The Commission conducted a two-session public hearing concerning Parks’s complaint on 30 July 1984 and 10 September 1984. At the later session, Levitz introduced into evidence Parks’s employment file, which indicated that Parks had received numerous oral and written reprimands for various mistakes he had committed over his eleven years of employment with Levitz.

Moreover, Parks had repeatedly received performance ratings of “satisfactory-minus” during the twenty-two months preceding his dismissal. The Commission’s Order, together with its Findings of Fact and Conclusions of Law, was issued on 25 April 1985. Inexplicably, the Commission appears to have ignored Levitz’s evidence relating to Parks’s history of employment in reaching the erroneous conclusion that Levitz had contended that Parks was terminated because of a merchandise pricing error he committed on 12 November 1982. 1 The Commission then found that three white employees had committed similar pricing mistakes at one time or another but were not discharged. In the Commission’s view, Levitz did not adequately explain the apparently disparate treatment afforded to Parks. ¹⁰⁷ Based primarily on those factual determinations, the Commission concluded as a matter of law that Levitz had failed to “articulate any legitimate non-discriminatory reason for terminating Mr. Parks as opposed to the similarly situated white employees”; therefore, it found racial discrimination in the firing of Parks. 2 The Commission ordered Levitz to rehire Parks with back salary and to cease and desist its discriminatory practices.

On 2 August 1985, the County, on behalf of the Commission, joined by Parks, filed their action in equity, pursuant to Prince George’s County Code § 2-197 (Supp.1985), seeking to have the circuit court enforce the Commission’s order. Two months later, on 4 October 1985, Levitz filed its appeal of the Commission’s order. Over the County’s objection, the court consolidated Levitz’s appeal and appellees’ enforcement actions. The court then affirmed the Commission’s order.

Motion to Dismiss The first matter for consideration is the motion to dismiss Levitz’s appeal for want of jurisdiction over the subject matter. It is the appellees’ contention that under § 12-302(a) of the Courts and Judicial Proceedings Article, Levitz has no right to appeal to this Court from the judgment of the circuit court in an appeal to it from the Commission. Moreover, the appellees maintain that because Levitz’s appeal from the Commission’s Order was not timely filed, pursuant to Md.Rule B4, the circuit court lacked jurisdiction to entertain that action. Both of these arguments miss the mark. ¹⁰⁸ Section 12-301 of the Courts and Judicial Proceedings Article (1984 Repl.Vol.) provides that a party may appeal a final judgment by the circuit court.

That broad grant of authority is somewhat limited by § 12-302(a) which states: Unless a right to appeal is expressly granted by law, § 12-301 does not permit an appeal from a final judgment of a court entered or made in the exercise of appellate jurisdiction in reviewing the decision of ... an administrative agency____ Consequently, the county is correct in maintaining that in the absence of any express statutory language permitting Levitz to note an appeal to this Court we are precluded from reviewing the circuit court’s exercise of appellate jurisdiction. In the context of this case, however, that point is irrelevant. The court below consolidated the county’s enforcement action in equity with Levitz’s appeal of the Commission’s order. In a concurrent exercise of original jurisdiction and appellate jurisdiction, the court issued a single judgment in the consolidated action.

This appeal is from that unitary judgment. Although § 12-302(a) enables Prince George’s County to deny its citizens the right to enlist our review of the circuit court’s exercise of appellate jurisdiction, that statute does not enable the county to preclude our review of the lower court’s exercise of original jurisdiction. Levitz is entitled to appeal the circuit court’s judgment because it was rendered in an equity proceeding filed by the appellees in that court. See Md.Cts. & Jud.

Proc.Code Ann. § 12-301 (1984 Repl.Vol.). Ordinarily, our identification of the basis upon which this case is properly before us would render it unnecessary for us to consider appellees’ contention that the circuit court should have dismissed, as untimely, the appeal filed by Levitz on 4 October 1985. The suggestion is made, however, that under provisions of the Prince George's County Code then in effect the failure to file a timely appeal placed the factual determinations of the Commission beyond judicial review. In responding to that contention, we must ¹⁰⁹ examine the code provisions relied on by appellees and their effect on the timeliness issue.

As of 2 August, 1984, after Parks had filed his complaint but before the Commission rendered its final decision, § 2-197 of the Prince George’s County Code, relating to the Human Relations Commission, was amended. Under the prior law, the county, in order to enforce compliance with Commission orders, would file an action in equity in the circuit court. The court, in turn could, and frequently would, hear the matter de novo, making its own factual findings as to discrimination. The August 1984 amendment continued to authorize the county to seek enforcement in equity, but also, inter alia, (1) permitted any party aggrieved by the Commission’s decision to file an appeal in the circuit court, pursuant to subtitle B of the Maryland Rules of Procedure; (2) provided that a “determination of the Human Relations Commission of a violation of this Division shall be a conclusive finding”; and (3) made the provisions of the amendment applicable not only to all future cases but also to all cases then under consideration either by the Commission or by the circuit court.

One reason for the “conclusive finding” provision, of course, was to eliminate the de novo trial in the circuit court. Appellees do not contend that in the event of a timely appeal the court could not inquire into the basis for or validity of the Commission’s finding; they do assert, however, that by failing to file a timely appeal Levitz waived any right to challenge the validity of the Commission’s findings in the equity enforcement action. In that respect, it is suggested, the Commission’s finding of a violation is “conclusive.” We need not address the argument that failure to appeal constitutes a waiver of all right to challenge the validity of the Commission’s finding. Levitz did appeal.

True, its appeal was not filed within 30 days of the Commission’s order, as required by Md.Rule B4, but appellees are ¹¹⁰ incorrect in their assertion that Rule B5 mandated dismissal of the appeal. What Rule B5 specifies is that [i]f the appellant shall fail to file his order for appeal within the time prescribed by Rule B4 (Time for Filing) or any order issued pursuant thereto, or shall fail to file his petition within the time prescribed by section e of Rule B2 (How Appeal Taken), the court shall dismiss the appeal unless cause to the contrary be shown. (Emphasis added.) Levitz contended that its counsel was assured by someone at the office of the Commission that its June 1982 Handbook contained an up-to-date version of Prince George’s County Code § 2-197. It further averred that all copies of the code available at the University of Maryland Law Library, University of Baltimore Law Library, main branch of the Enoch Pratt Free Library (an official depository of state documents), Baltimore City Bar Library, and the law library of the Circuit Court for Prince George’s County contained the same version of § 2-197 as appeared in the 1982 Handbook, i.e., without the 1984 amendment.

The court concluded that lack of actual notice of the amendment provision for appeal despite diligent efforts to keep abreast of the local law constituted good cause for not dismissing the appeal. We see no error or abuse of discretion in that holding. 3 Since Levitz appealed the Commission’s decision and the court allowed the late appeal, there was no waiver of the right to challenge the Commission’s findings. The Appeal A. Scope of Review The Prince George’s County Code does not identify any particular standard for reviewing the decisions of the County’s Human Relations Commission, thus we shall employ the general principle that “decisions of an administrative ¹¹¹ agency will not be disturbed on appeal unless they are not supported by substantial evidence or are arbitrary, capricious or unreasonable.” Supervisor of Assessments v. Peter & John Radio Fellowship, Inc., 274 Md. 353, 355 , 335 A.2d 93 (1975). Substantial evidence supports a decision when the record discloses “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Bullock v. Pelham Wood Apartments, 283 Md. 505, 512 , 390 A.2d 1119 (1978) (quoting Snowden v. Mayor of Baltimore, 224 Md. 443, 448 , 168 A.2d 390 (1961)).

Consequently, the scope of a substantial evidence review is restricted to determining “whether a reasoning mind reasonably could have reached the factual conclusion the agency reached.” Insurance Commissioner v. National Bureau of Casualty Underwriters, 248 Md. 292, 309-10 , 236 A. 2d 282 (1967). It is not our function to substitute our judgment for that of the agency with respect to conflicting evidence. Board of County Commissioners of Prince George’s County v. Levitt & Sons, Inc., 235 Md. 151, 159-60 , 200 A.2d 670 (1964). Consideration of whether the Commission’s order is arbitrary, capricious or unreasonable is similar in scope to that of a substantial evidence review.

A decision unsupported by sufficient facts or proper factual inferences is arbitrary, capricious and unreasonable. Insurance Commissioner v. National Bureau of Casualty Underwriters, supra, 248 Md. at 300-01 , 236 A.2d 282 . Furthermore, an administrative action is deemed arbitrary if the agency refuses to consider evidence properly before it. Heaps v. Cobb, 185 Md. 372, 378 , 45 A.2d 73 (1945).

With these principles in mind, we shall examine the Commission’s order. B. The Commission’s Order Although not explicitly stated, it appears from the Commission’s Findings of Fact and Conclusions of Law that the determination that Levitz had committed unlawful discrimination was based upon the Commission’s application of the prima facie method of establishing discrimination outlined ¹¹² in McDonnell Douglas Corp. v. Green, 411 U.S. 792 , 93 S.Ct. 1817 , 36 L.Ed.2d 668 (1973). Under McDonnell Douglas, the complainant has the initial burden to set forth a prima facie case of unlawful discrimination. Just how that is done in the context of termination of employment is the subject of some disagreement.

See e.g., Boner v. Board of Commissioners, 674 F.2d 693, 696 (8th Cir.1982) (plaintiff must show (1) he was a member of a protected class, (2) he was capable of performing the job, and (3) he was discharged); Rohde v. K. O. Steel Castings, Inc., 649 F.2d 317, 322 (5th