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15-1800-20591-2 |
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF HUMAN
SERVICES
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In the Matter of Maltreatment, Disqualification and License Revocation for Patricia and Wayne Zabel |
ORDER
DENYING ATTORNEY FEES |
On May 9, 2011, Lucinda E. Jesson, Commissioner of Human Services issued a final Order in this contested case matter. On June 7, 2011, the Respondents filed an Application for Fees and Costs, pursuant to Minn. Stat. § 15.472[1] and Minn. R. 1400.8401.[2] On June 24, 2011, the Department filed its Objection to the Application for Fees and Costs. On June 27, 2011, the Respondents filed their Response to the Department’s Objection.
Appearances: Cynthia B. Jahnke, Assistant Attorney General, appeared on behalf of the Department of Human Services (Department). James R. Carlson, O’Brien & Wolf, L.L.P., appeared on behalf of Patricia and Wayne Zabel (Respondents).
Based on a review of the record and for the reasons set forth in the accompanying Memorandum,
IT IS HEREBY ORDERED:
1. Respondents’ Application for Fees and Costs is DENIED.
2. This decision shall be made a part of the record containing the final decision of the Department.
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Dated this |
30th |
day of |
June |
2011. |
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s/Beverly Jones Heydinger |
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BEVERLY JONES HEYDINGER |
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Administrative Law Judge |
NOTICE
Pursuant to Minn. Stat. § 15.474, any party dissatisfied with the fee determination may petition for leave to appeal to the court having jurisdiction to review the merits of the underlying decision of the contested case. If the court denies the petition for leave to appeal, no appeal may be taken from the denial.
MEMORANDUM
In a contested case proceeding, if a prevailing party other than the state shows that the position of the state was not substantially justified, the administrative law judge shall award fees and other expenses to the party unless special circumstances make an award unjust.[3]
A party seeking an award of fees and other expenses shall submit to the administrative law judge an application which shows that the party is a prevailing party and eligible to receive the award, and shall allege that the position of the state was not substantially justified.[4]
In their Application, the Respondents assert that they meet the definition of “party” under the applicable statute, that they were the “prevailing parties,” and that the position of the Department in the underlying contested case was not substantially justified.
The underlying contested case was initiated by the Department to revoke the Respondents’ license to provide foster care because of maltreatment of persons in their care and disqualification from providing licensed services, as well as violations of the licensing rules. The case arose from an incident in which a minor receiving respite care from the Respondents sexually abused a vulnerable adult who was also in Respondents’ care. It is not disputed that the assault occurred in the Respondents’ home while they were providing care to the minor and vulnerable adult. The issues at the heart of the contested case were whether the Respondents failed to provide appropriate supervision and whether they violated licensing rules by failing to have required protection plans in place.
The facts and their application to the licensing rules were confusing and complicated by lax county supervision and differing requirements for providing respite care and foster care. Some of the alleged licensing violations were dismissed as a matter of law prior to hearing. Following a contested case hearing, on January 11, 2011, the Administrative Law Judge issued Findings of Fact, Conclusions and Recommendation, concluding that the determination of maltreatment should be reversed and that there was no basis for disqualification or sufficient violations to support revocation of the license. However, Respondents had violated provisions of the licensing rules and a sanction was warranted.
On May 9, 2011, the Commissioner issued the final order, adopting the Administrative Law Judge’s findings and conclusions and placing the Respondents under a Conditional License that required them to get additional training. The Commissioner also levied a fine of $300 for rule violations.
Because the sanction imposed by the Commissioner was significantly less than initially imposed, the Respondents contend that they are eligible to receive an award as parties, that they were the prevailing parties, and that the Department’s position was not substantially justified. Their claim is not warranted and should be denied.
The Respondents Are Not Parties Entitled to Relief
The statute that allows an award of attorneys fees is quite limited. A party to a contested case proceeding must meet the definition of “party” as set forth in Minn. Stat. § 15.471 in order to qualify for the award. It defines a party for this purpose as an unincorporated business, partnership, corporation, association, or organization with fewer than 500 employees and with annual revenues that do not exceed $7,000,000 at the time the contested case was initiated.[5] Although the Respondents hold their license as individuals, they contend that they operate the foster care as a business and meet this definition.
It is not necessary to reach a determination about whether the Respondents meet this definition because an exception to the definition squarely disqualifies the Respondents from eligibility for an award of attorneys fees.
The exception states:
“Party” does not include a person providing services pursuant to licensure or reimbursement on a cost basis by the … Department of Human Services, when that person is named … as a party in a matter which involves the licensing or reimbursement rates, procedures, or methodology applicable to those services.
Although the Respondents attempt to argue that they fall outside this exclusion, such an argument requires a strained reading. It is clear that persons licensed by the Department who are involved in disputes about their license are not entitled to recover attorneys fees under this statute.
The licensing act requires that license holders fully comply with all state laws and rules and, by seeking a license, they subject themselves to scrutiny and reasonable enforcement actions. The Department’s enforcement of the laws and regulations related to licensing is crucial to the protection of the health and safety of persons receiving care.
The Department’s Position was Substantially Justified
Although the Department did not succeed in its attempt to demonstrate that the Respondents were responsible for maltreatment, it is incorrect to conclude that the Department’s position was not substantially justified. A vulnerable adult was sexually abused while in their care. A minor and vulnerable adult were allowed to go to a lower level of Respondents’ home and lock the door to a bedroom for at least a few minutes before Ms. Zabel discovered that the two were engaged in inappropriate sexual behavior. The circumstances required a full investigation because a license holder is responsible for assuring appropriate supervision of persons receiving care.
“Substantially justified” is defined as: “the state’s position had a reasonable basis in law and fact, based on the totality of the circumstances before and during the … contested case.”
The Department had a basis in law and fact for its actions. If the Department finds that a license holder fails to properly supervise a minor or a vulnerable adult receiving care and one of them is harmed, there may be maltreatment. There was a great deal of conflicting information in this proceeding. Although the Department failed to prove its claim of maltreatment by a preponderance of the evidence, there was certainly some merit it. It is unfair and inaccurate to describe this proceeding, as Respondents have described it, as a “witch hunt.” A serious incident occurred while two vulnerable people were in Respondents’ care.
Moreover, it is plain that the Respondents were in violation of certain provisions of the licensing rules. These led to a determination that a Conditional License and small fine were warranted.
Under the circumstances presented here, even if the Respondents met the definition of “party” for the purposes of the statute, they would not be eligible for an award because the Department’s position was substantially justified.
The Department’s Response Was Timely
In
their Response to the Department’s Objections, Respondents claimed that the
Department failed to respond to their Application within the time allowed by
law. Pursuant to
B.J.H.