|
7-1902-16744-2 |
STATE
OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE MINNESOTA DEPARTMENT OF LABOR AND INDUSTRY
|
In the Matter of Donald Oreskovich |
FINDING OF FACT, CONCLUSIONS AND RECOMMENDATION ON MOTION TO
VACATE |
This matter came on for hearing on
remand from the Commissioner of Labor and Industry before Administrative Law
Judge
Michael J. Tostengard, Assistant Attorney General, 1200
Del A. Blocher, Attorney at Law,
NOTICE
This report is a recommendation, not a final decision. The Commissioner of the Minnesota Department of Labor and Industry will make the final decision after a review of the record. The Commissioner may adopt, reject or modify the Findings of Fact, Conclusions, and Recommendation. Under Minn. Stat. § 14.61, the final decision of the Commissioner shall not be made until this Report has been made available to the parties to the proceeding for at least ten days. An opportunity must be afforded to each party adversely affected by this Report to file exceptions and present argument to the Commissioner. Parties should contact Nancy J. Leppink, General Counsel of the Department of Labor and Industry. 443 Lafayette Road N., St. Paul, MN 55155 to learn the procedure for filing exceptions or presenting argument.
If the Commissioner fails to issue a final decision within 90 days of the close of the record, this report will constitute the final agency decision under Minn. Stat. § 14.62, subd. 2a. In order to comply with this statute, the Commissioner must then return the record to the Administrative Law Judge within 10 working days to allow the Judge to conduct further proceedings. The record closes upon the filing of exceptions to the report and the presentation of argument to the Commissioner, or upon the expiration of the deadline for doing so. The Commissioner must notify the parties and the Administrative Law Judge of the date on which the record closes.
Under Minn. Stat. § 14.62, subd. 1, the agency is required to serve its final decision upon each party and the Administrative Law Judge by first class mail or as otherwise provided by law.
STATEMENT OF ISSUES
Whether it is appropriate to vacate the default order recommending disciplinary action against Mr. Oreskovich for engaging in unlicensed residential building contractor activity, for violating a prior Cease and Desist Order, and for using another licensee's license number for the fraudulent purpose of obtaining a building permit?
Based on the proceedings herein, the Administrative Law Judge makes the following:
FINDINGS OF FACT
1. On August 3, 2005, a Notice of and Order for Hearing, Order for Prehearing Conference and Statement of Charges (Notice) in this matter was mailed to Mr. Oreskovich by first class mail to the following address: Donald Oreskovich, 28347 Henderson Way, Randolph, Minnesota, 55065.[2]
2. Mr. Oreskovich did receive the Notice that was mailed to him. He had been involved in a proceeding with the Department, in which Mr. Oreskovich had been represented by counsel.[3] Mr. Oreskovich did not read the Notice, except to note that the Department had sent it to him, and then filed the document with the rest of his file in that other matter.[4] The Department did not serve Mr. Oreskovich’s counsel with a copy of the Notice.
3. This matter was set on for prehearing conference on September 22, 2005, at the Office of Administrative Hearings. The Notice reads, at page 3:
Respondent's failure to appear at the prehearing conference may result in a finding that Respondent is in default, that the Department's allegations contained in the Statement of Charges may be accepted as true, and that its proposed disciplinary action may be upheld.
4. Mr. Oreskovich did not appear at the prehearing conference nor did anyone appear on his behalf. He made no prehearing request for a continuance, nor did he file a Notice of Appearance. The ALJ deemed the allegations in the Notice to be proved by virtue of the lack of an appearance by Mr. Oreskovich. On October 19, 2005, the ALJ issued a Findings of Fact, Conclusions and Recommendation that incorporated by reference the allegations in the Notice and recommended that the Commissioner of Labor and Industry take disciplinary action against Mr. Oreskovich.[5]
5. Mr. Oreskovich received the Default Order by U.S. Mail soon after that order was issued. He immediately contacted his attorney who read the document and realized that it referred to a notice that would indicate a different action had been initiated by the Department.[6]
6. On October 27, 2005, Mr. Oreskovich, through counsel, requested that the Commissioner vacate the Default Order and set this matter on for hearing. The Commissioner set this matter on for an evidentiary hearing before the ALJ to determine if the Default Order should be vacated.
7. Counsel for Mr. Oreskovich made an offer of proof indicating that a good faith factual dispute exists for hearing on the issues addressed in the Default Order.
8. The Department introduced no evidence that would support a conclusion that the agency would be prejudiced by vacating the Default Order.
Based on the Findings, the Administrative Law Judge makes the following:
CONCLUSIONS
1. The Administrative Law Judge and the Commissioner of Labor and Industry have jurisdiction in this matter pursuant to Minn. Stat. § 14.50, 45.027, subds. 6 and 7, 326.84, and 326.91.
2. Any of the Findings more properly termed Conclusions are adopted as such.
3. Donald Oreskovich’s receipt of the Notice constitutes actual notice of the Prehearing Conference in this matter. The Department complied with all procedural requirements of law and rule in serving that notice.
4. Under
5. Under
6. Based on the evidence provided at the December 19, 2005 hearing, Mr. Oreskovich has demonstrated that his failure to appear in response to the Notice was the result of excusable neglect and that denying him a hearing on the merits of this matter would be inconsistent with substantial justice.
Based on the Conclusions, the Administrative Law Judge makes the following:
RECOMMENDATION
IT IS RECOMMENDED that Default Order against Donald Oreskovich be VACATED and this matter be set on for hearing.
Dated this _10th day of January, 2006
_/s/
Richard C. Luis___________
RICHARD
C. LUIS
Administrative
Law Judge
Reported: Taped (1 tape), no transcript prepared.
MEMORANDUM
This matter was remanded by the Department for an
evidentiary hearing as to whether a default judgment should be vacated. The standards for determining whether
vacation is appropriate are well established under Minn. R. Civ. P. Rule 60.02,
which states in relevant part:
On
motion and upon such terms as are just, the court may relieve a party or the
party’s legal representatives from a . . . order . . . and may order a new trial or grant
such other relief as may be just for the following reasons:
(a)
Mistake, inadvertence, surprise, or excusable neglect ….
Rule 1400.8300 contains
essentially the same standards under the provisions governing reconsideration
or rehearing.[7] The only additional requirement is that in
addition to the demonstration of excusable neglect, the party requesting relief
must show that denial of a hearing would be “inconsistent with substantial
justice.”
In applying Rule 60.02,
A
party seeking relief under rule 60.02 must demonstrate (1) a reasonable case on
the merits, (2) a reasonable excuse for the failure to act, (3) that he acted
with due diligence after notice of the entry of judgment, and (4) that there
will be no substantial prejudice to the opposing party if the motion to vacate
is granted. Finden v. Klaas, 268
The policy espoused in
The issue of prejudice has
been addressed in contested case hearings.
The filing of a complaint two months late has been held to not
constitute prejudice, even where employee witnesses have dispersed.[10] A late-filed complaint that was more than a
year overdue was not found to be prejudicial.[11] Mr. Oreskovich has shown that the Department
will suffer no prejudice in pursuing this matter.
Mr. Oreskovich has shown
that his failure to respond to the Notice, resulting in the issuance of the Default
Order, was excusable neglect and that failing to vacate that order
would be inconsistent with substantial justice.
For these reasons the ALJ recommends that the Default Order be vacated
and this matter set on for hearing.
R.C.L.
[1] The remand was ordered by Nancy J. Leppink, General Counsel of the Department of Labor and Industry, acting as the Commissioner’s delegee pursuant to Minn. Stat. § 45.024, subd. 2.
[2] Department’s Motion Ex. 1.
[3] Respondent’s Motion Ex. 3.
[4] Testimony of Donald Oreskovich.
[5] ITMO Donald Oreskovich, OAH Docket No. 7-1902-16744-2 (Findings of Fact, Conclusions and Recommendation issued October 19, 2005)(“Default Order”).
[6] Testimony of Donald Oreskovich.
[7]
[8] Norgart v. Werner, C2-99-1227 (Minn.App. 2000) ( http://www.lawlibrary.state.mn.us/archive/ctapun/0003/1227.htm).
[9] Riemer v. Zahn, 420 N.W.2d 659, 661 (Minn.App. 1988); Galatovich v. Watson, 412 N.W.2d 758, 760 (Minn.App. 1987).
[10] Gary W. Bastian, Commissioner, Department of Labor and Industry, State of Minnesota v. Fagen, Inc., OSH Division Docket No. 5387, OAH Docket No. 1-1901-10449-2 (Order issued April 12, 1996).
[11] Gary W. Bastian, Commissioner, Department of Labor and Industry, State of Minnesota v. J & L Schwieters, Construction, Inc., OSH Division Docket No. 5178, OAH Docket No. 8-1901-11335-2 (Order issued November 3, 1997).