THE SUPREME COURT OF THE
FEDERATED STATES OF MICRONESIA
Cite as Semes v. FSM,
4 FSM Intrm. 66 (App. 1989)
FEDERATED STATES OF MICRONESIA,
FSM APPEAL NO. P1-1989
Argued: June 1, 1989
Decided: June 19, 1989
Hon. Edward C. King, Chief Justice, FSM Supreme Court
Hon. Richard H. Benson, Associate Justice, FSM Supreme Court
Hon. C. Guy Powles, Temporary Associate Justice, FSM Supreme Court*
*Former Judge, Western Samoa, on this Court by special designation for this case.
For the Appellant: R. Stephen Skipton
Attorney at Law
Micronesia Legal Services Corporation
P.O. Box 129
Pohnpei, FM 96941
For the Appellee: Steven P. Pixley
Chief, Division of Litigation
FSM Office of the Attorney General
Pohnpei, FM 96941
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Administrative Law - Judicial Review; Public Officers and Employees
In reviewing the termination of national government employees under the National Public Service System Act, the FSM Supreme Court will review factual findings insofar as necessary to determine whether there is evidence to establish that there were grounds for discipline. Semes v. FSM, 4 FSM Intrm. 66, 71 (App. 1989).
Administrative Law - Administrative Procedures Act; Administrative Law - Judicial Review
The Administrative Procedure Act judicial review provisions do not apply to statutes enacted by the Congress of the Federated States of Micronesia to the extent that those statutes explicitly limit judicial review. Semes v. FSM, 4 FSM Intrm. 66, 72 (App. 1989).
Administrative Law - Judicial Review; Public Officers and Employees
Under the National Public Service System Act, where the FSM Supreme Court's review is for the sole purpose of preventing statutory, regulatory and constitutional violations, review of factual findings is limited to determining whether substantial evidence in the record supports the conclusion of the administrative official that a violation of the kind justifying termination has occurred. Semes v. FSM, 4 FSM Intrm. 66, 72 (App. 1989).
Public Officers and Employees
The National Public Service System Act places broad authority in the highest management official , authorizing dismissal based upon disciplinary reasons when the official determines that the good of the public service will be served thereby. Semes v. FSM, 4 FSM Intrm. 66, 73 (App. 1989).
Constitutional Law - Due Process; Public Officers and Employees
The National Public Service System Act and the FSM Public Service System Regulations establish an expectation of continued employment for nonprobationary national government employees by limiting the permissible grounds and specifying necessary procedures for their dismissal; this is sufficient protection of the right to continued national government employment to establish a property interest for nonprobationary employees which may not be taken without fair proceedings, or "due process." Semes v. FSM, 4 FSM Intrm. 66, 73 (App. 1989).
Constitutional Law - Due Process
Only in extraordinary circumstances where immediate action is essential to protect crucially important public interests, may private property be seized without a prior hearing of some kind. Semes v. FSM, 4 FSM Intrm. 66, 74 (App. 1989).
Constitutional Law - Due Process
Once it is determined that a statute establishes a property right subject to protection under the due process clause of the FSM Constitution, constitutional principles determine what process is due as a minimum. Semes v. FSM, 4 FSM Intrm. 66, 74 (App. 1989).
Constitutional Law - Due Process; Public Officers and Employees; Statutes
In the absence of statutory language to the contrary, the National Public Service System Act's mandate may be interpreted as assuming compliance with the constitutional requirements, because if it purported to preclude constitutionally required procedures, it must be set aside as unconstitutional. Semes v. FSM, 4 FSM Intrm. 66, 74 (App. 1989).
Constitutional Law - Due Process
In assessing the government's shorter term, preliminary deprivations of private property to determine what, if any procedures are constitutionally necessary in advance of the deprivation, the FSM Supreme Court will balance the degree of hardship to the person affected against the government interests at stake. Semes v. FSM, 4 FSM Intrm. 66, 75 (App. 1989).
Constitutional Law - Due Process; Public Officers and Employees
Constitutional due process requires that a nonprobationary employee of the national government be given some opportunity to respond to the charges against him before his dismissal may be implemented; including oral or written notice of the charges against him, an explanation of the employer's evidence, and an opportunity to present his side of the story. Semes v. FSM, 4 FSM Intrm. 66, 76 (App. 1989).
Constitutional Law - Due Process; Public Officers and Employees
Implementation of the constitutional requirement that a government employee be given an opportunity to respond before dismissal is consistent with the statutory scheme of the National Public Service System Act, therefore the Act need not be set aside as contrary to due process. Semes v. FSM, 4 FSM Intrm. 66, 77 (App. 1989).
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EDWARD C. KING, Chief Justice:
This is a direct appeal by appellant Selerino Semes from the original December 9 1987 termination of his status as an employee of the National Government and from the affirmance of the original decision by the President of the Federate States of Micronesia.
Mr. Semes asserts that the findings and decision made against him by the President after his appeal were unsupported by the evidence, and that dismissal was an excessively harsh penalty for the infraction he was found to have committed. He also contends that the government's December 9, 1987 termination of his employment, without first giving him any opportunity to respond to the charges, violated his constitutional right to due process.
For the reasons explained in this opinion, we agree that the original termination of Mr. Semes from his employment without providing him any opportunity to respond to the charges violated his constitutional right of due process. Therefore the termination may not be given effect as of December 9, 1987. However, he was subsequently given the opportunity to present his side of the case at a full hearing before an ad hoc committee. Although the committee recommended that Mr. Semes be reinstated to his former position, we conclude that the final decision reached by the President, that Mr. Semes had violated government regulations through knowing use of a government vehicle in an unauthorized manner, was reasonable, as was the President's decision to terminate Mr. Semes' employment for that infraction.
Selerino Semes, a tax officer III with the FSM national government revenue office in Pohnpei, had been a government employee with the Federated States of Micronesia and other governments for 17 years. On the morning of November 28, 1987, at approximately 2:30 a.m., he was a passenger in a car rented by the national revenue office for government work purposes only. Mr. Semes and the driver, Edwin Santos, Mr. Semes' colleague in the same government office, were returning, along with three young females, from the Seven-Seven bar on Tekehtik Island. They were proceeding on the causeway toward Kolonia town when they collided with another car. The vehicles were destroyed. Four of the five occupants in the car driven by Mr. Santos were injured.
Mr. Semes and Mr. Santos had been drinking and neither was on duty. Nobody seriously disputes that their use of the car was unauthorized, prohibited by government policies known to both. However Mr. Semes maintains that on the night in question he was under the impression that the car had been rented personally by Seremea Arnold, administrator of the FSM Revenue Division, and was not aware that this car was covered by those prohibitory policies.
Approximately one week after the collision, Secretary of Finance Al Tuuth, based upon information from other persons concerning this incident, instructed Seremea Arnold to terminate the employment of Messrs. Santos and Semes. Mr. Santos did not appeal that ruling.
On December 9, 1987, Mr. Arnold gave a letter to Mr. Semes, notifying him that his employment with the FSM Revenue Division "is terminated effective with the close of business today." Noting that Mr. Semes' use of government vehicles had been suspended on August 12, 1987 for one month due to improper use of government vehicles, the letter emphasized "your involvement in unauthorized use of government vehicles" on November 28, 1987 through "use of a government leased vehicle after the established deadline" leading to the "collision with another vehicle at 2:40 a.m. resulting in serious injury to several persons and extensive damage to property."
The letter of termination told Mr. Semes of his right to appeal. However, as already noted, the termination was stated to be effective immediately and no opportunity was provided for Mr. Semes to respond to the charges before the termination took effect.
Mr. Semes appealed in timely fashion and the hearing before an ad hoc committee as contemplated by 52 F.S.M.C. §§ 153-155 was held on January 19 and 20, 1988.
On January 20, 1988 the committee submitted its report, concluding that Mr. Semes had thought the rental car was being rented privately by Mr. Arnold and had no knowledge that it was being rented by the national revenue office, therefore was unaware that the government's prohibitions against private use of vehicles were applicable. Based upon these findings the committee concluded that the termination of employment was unjustifiable and recommended reinstatement of Mr. Semes to his position.
That recommendation was then submitted to the President, who is identified in the National Public Service System Regulations, § 18.14 b. (Dec. 1980), as the highest management official for any agency within the executive branch of the National Government. The National Public Service System Act provides that the decision of the highest management official "shall be final," 52 F.S.M.C. 156, subject to judicial review under 52 F.S.M.C. 157.
The President examined the transcript of the proceeding and the supporting documents delivered by the ad hoc committee along with the committee's decision. He concluded that Mr. Semes had been aware that the
vehicle was being rented by the government and was knowingly violating government policies by using the vehicle at the time of the collision. On March 15, 1988, the President rejected the recommendation of the ad hoc committee and upheld the dismissal of Mr. Semes.
Mr. Semes now seeks judicial review under 52 F.S.M.C. 157. His appeal was originally filed with the trial division of this Court but, pursuant to stipulation of the parties and agreement that no additional evidence need be submitted or considered, the litigation was transferred to the appellate division. Cf. Olter v. National Election Commissioner, 3 FSM Intrm. 123, 128 (App. 1987).
II. Legal Analysis
The only National Public Service System Act provision for judicial review emphasizes the limitations upon review.
Limitations on judicial review - Disciplinary actions taken in conformance with this subchapter shall in no case be subject to review in the Courts until the administrative remedies prescribed herein have been exhausted; nor shall they be subject to such review thereafter except on the grounds of violations of law or regulation or of denial of due process or of equal protection of the laws.
52 F.S.M.C. 157.
Review of Factual Findings.
Section 157 says nothing directly about judicial review of factual findings. Yet clearly some form of judicial review of factual findings is necessary, because the court must consider whether there has been a "violation of law or regulation." AS the trial division has noted, termination of national government employment must have a legal basis. "The National Public Service System Act does not permit termination on the whim of the supervisor. An employee may be dismissed only 'for disciplinary reasons' and upon the determination of management official that 'the good of the public service will be served thereby." Suldan v. FSM (II), 1 FSM Intrm. 339, 352 (Pon. 1983), quoting 52 F.S.M.C. 152. To review a termination action we must determine whether there is evidence to establish that there were grounds for discipline. If there is not sufficient evidence to that effect, dismissal would be in violation of the law.
Standard of Review
The National Public Service System Act does not say what standard is to be used in reviewing factual findings of administrative officials under the Act. Normally, when a statute calls for judicial review but does not prescribe the standard to be employed, we look to the Administrative Procedure
Act, 17 F.S.M.C. 101 et seq. (APA); Olter v. National Election Commissioner, 3 FSM Intrm. at 129-31. However, the APA judicial review provisions do not apply to "statutes enacted by the Congress of the Federated States of Micronesia" to the extent that those statutes "explicitly limit judicial review." 17 F.S.M.C. 111(1).
The judicial review provisions of 52 F.S.M.C. 157 is written in restrictive form, permitting judicial review of factual findings only by implication, and then only so far as necessary to determine whether there has been a violation of law or regulation or denial of due process. This limiting language is sufficiently "explicit" to prevent the expansive judicial review of findings normally available under the APA, which authorizes the court to "make its own factual determinations." Olter, 3 FSM Intrm. at 131. Under the National Public Service System Act, where our review is for the sole purpose of preventing statutory, regulatory and constitutional violations, we conclude that review of factual findings is limited to determining whether substantial evidence in the record supports the conclusion of the administrative official that a violation of the kind justifying termination has occurred.
Thus in this case it is not our task to weigh against each other the conclusions of the President and of those of the ad hoc committee or to decide which of those conclusions were considered more persuasive. Under the Act, the committee merely recommends; the highest management official makes the final decision. 52 F.S.M.C. 156. Here then, the court is required to uphold the President's findings of fact if there is substantial evidence in the record to support them.
The critical difference between the views taken by the President and the committee was that the President believed that Mr. Semes was aware that the car had been rented by the government.
The President carefully detailed the reasons for this finding, pointing to various portions of the testimony reflected in the hearing record. These included admissions by Mr. Semes that he had previously been punished for improper use of government vehicles; that a few days prior to the night of the accident, he had driven the car involved in the accident for government business purposes; and that he asked questions of Mr. Santos before they began driving to the Seven-Seven, and received answers, that established Mr. Semes' awareness that the car was subject to the policies against private use of government vehicles.
We find the evidence sufficient to support the President's finding that Mr. Semes did know that the vehicle was rented by the government and was subject to governmental use restrictions.
The Dismissal Decision.
We also have a limited role to play in response to a contention, such as that made here by Mr. Semes, that a particular form of punishment is excessive
or unreasonable. The statute places broad authority in the highest management official, authorizing dismissal based upon disciplinary reasons when the official "determines that the good of the public service will be served thereby." 52 F.S.M.C. 152.
In this case a determination of reasons for disciplinary action was made originally and explained fully to Mr. Semes in Mr. Arnold's letter of December 9, 1987. We have already here upheld the President's determination that there were reasons for disciplining Mr. Semes.
The letter also stated that "the efficiency of the public service will be promoted" by the termination. The President's report of March 15, 1988 confirmed that conclusion and represented an affirmative decision of the highest management official as provided in the Act. Mr. Semes does not contend that this was insufficient compliance with the requirement of a determination that dismissal would be for the "good of the public service" and we therefore do not consider that question here.
Thus, the statutory conditions for dismissal have been met. The remaining question is whether dismissal under the circumstances here was so unduly harsh as to amount to an abuse of discretion. Mr. Semes had previously been suspended for thirty days for wrongful use of the government vehicle. On the night to November 27, 1987, he and Mr. Santos were employing the vehicle rented by the government for drinking purposes. They had with them in the vehicle several other occupants and became involved in a rather spectacular collision resulting in extensive personal injuries and property damage.
We cannot say, under the circumstances of this particular infringement, that the President's actions in dismissing Mr. Semes were unreasonable.
Right To Due Process Prior To Termination.
This Court's trial division has already had occasion to consider the National Public Service System Act. In Suldan v. FSM (II), 1 FSM Intrm. 339, 351-54 (Pon. 1983), the court concluded that 52 F.S.M.C. §§ 151-157 and FSM Public Service Regulations § 18.4 establish an expectation of continued employment for nonprobationary national government employees by limiting the permissible grounds, and specifying necessary procedures, for their dismissal. The trial division held, and we agree, that this is sufficient protection of the right to continued national government employment to establish a property interest for non-probationary employees which may not be taken without fair proceedings, or "due process." FSM Const. art. IV, § 3.
Mr. Semes does not contend that those procedures ultimately provided in response to his appeal were lacking in due process. He does however argue that because his employment with the government was a constitutionally protected property interest he was entitled to some opportunity to respond to the charges before the initial order of termination was placed into effect on December 9. We agree, for reasons already outlined in previous decisions of this Court's trial division.
Short term seizure by the government property, or temporary abridgment of a property right, in anticipation of further decisionmaking, may itself be an encroachment upon constitutionally protected property rights. In Ishizawa v. Pohnpei, 2 FSM Intrm. 67, 76 (Pon. 1985), the court found "troubling" the failure of officials to seek a judicial determination as to the propriety of the prior seizure of a vessel for "a full three days," noting that "it is normally required that a hearing be held prior to the seizure of property. 2 FSM Intrm. at 76. Only in "extraordinary circumstances" where immediate action is essential to protect crucially important public interests, may private property be seized without a prior hearing of some kind. Falcam v. FSM (II), 3 FSM Intrm. 194 (Pon. 1987)1. "Specific requirement of due process may vary depending on the nature of decisions to be made and the circumstances. At the core however is the right to be heard." Etpison v. Perman, 1 FSM Intrm. 405, 423 (Pon. 1984).
The fundamental concept of procedural due process is that the government may not be permitted to strip citizens of "life, liberty or property" in an unfair, arbitrary manner. Before such important individual interests are exposed to possible governmental taking or deprivation, the Constitution requires that the government follow procedures calculated to assure a fair and rational decision making process.
In Falcam (II), the trial division applied these principles to government employment, saying that rarely, if ever, could there be suitable justification for governmental withholding, without a prior hearing, of salary payments already earned. 3 FSM Intrm. at 194.
The National Public Service System Act itself does not specify that a hearing must be held prior to implementation of an order of dismissal. The constitution, however, assures that right. In other words, once it is determined that the statute establishes a property right subject to protection under the due process clause, constitutional principles determine what process is due as a minimum. Suldan (II), 1 FSM Intrm. 354. In the absence of statutory language to the contrary, the statutory mandate may be interpreted as assuming compliance with the constitutional requirements. If the statute does not purport to preclude constitutionally required procedures, it must be set aside as unconstitutional. Suldan (II), at 357-59.
Not infrequently governmental officials may perceive there to be a legitimate governmental interest in depriving a citizen or employee, on a short term basis, of property claimed by that person. Typically, the government desires to withhold the property or payment to avoid possible government loss in the event the fuller procedures may establish that the
person is not entitled to the property. As Ishizawa and Falcam (II) illustrate, government actions of this kind may take various forms, including seizure of a vessel or withholding of funds allegedly owing to an employee. The deprivation objected to by Mr. Semes was the implementation of his dismissal so that he was unable to work and was deprived of compensation while the parties awaited the hearing on his appeal.
These temporary deprivations may cause various degrees of hardships to the persons affected. Likewise the importance of the government interests at stake may vary widely depending on the circumstances. Of course, what would be necessary to assure an accurate understanding of the facts before the temporary deprivation also may differ greatly from one situation to another. In assessing shorter term, preliminary deprivations to determine what, if any, procedures are constitutionally necessary in advance of the deprivation, courts attempt to balance the factors mentioned above.2
The private interest here, the right to retain government employment, is of great significance. While this geographical area has traditionally been a subsistence society and some parts of the Federated States of Micronesia have retained that as the primary way of life, many governmental employees, especially long time ones, would find it difficult to return to the life of a farmer and fisherman. There are no welfare or unemployment compensation programs to provide for basic needs while a dismissed employee awaits the outcome of this his appeal. Indeed, outside of government, there is relatively little employment available in the Federated States of Micronesia. The difficulty of finding alternative work surely would be increased by the fact that the applicant has been dismissed from governmental employment.
The government's interest in immediate termination does not outweigh these interests. The continued salary payments to an employee while the appeal is pending would be a negligible part of the overall budget. There is no indication that Mr. Semes was a disruptive force or would have impeded government operations if allowed to continue working until conclusion of the appeal. If the point of prompt dismissal was to impress other employees with the government's determination to prevent misuse of government vehicles, surely that could have been accomplished by the notice of dismissal itself, even while delaying actual implementation of the dismissal until the appeal was ended.
Many of the considerations noted by the United States Supreme Court in a similar case are pertinent here as well.
[T]he employer shares the employee's interest in avoiding disruption and erroneous decision; and until the matter is settled, the employer would continue to receive the benefit of the employee's labors. It is preferable to keep a qualified employee on than to train a new one. A governmental employer also has an interest in keeping citizens usefully employed rather than taking the possibly erroneous and counterproductive step of forcing its employees [out] . . . . Finally, in those situations where the employee on the job, it can avoid the problem by suspending with pay.
Cleveland Bd. of Educ. v. Loudermill, 470 U.S. at 544-45, 105 S. Ct. at 1495-96, 84 L. Ed. 2d at 505-06.
The requirement of some form of a hearing prior to termination of government employment is likely to have great bearing upon the accuracy and fairness of the original termination decision. Dismissals for cause almost invariably involve factual issues or disputes. This case is an apt illustration of that truth. Secretary Tuuth was quite candid in acknowledging that he instructed Mr. Arnold to dismiss Mr. Semes on the basis of very little information and that the dismissal was carried out without anybody making an attempt to verify, with Mr. Semes or with Mr. Santos, the accuracy of Mr. Tuuth's information and assumptions.
Investigation would have established that Mr. Semes was merely a passenger. This factor alone should have alerted management officials that further inquiry was needed to assess his degree of culpability. If that inquiry had been made, officials would have learned that Mr. Semes had a plausible contention that he was unaware the car was rented by the government. The ad hoc committee, which heard the testimony and observed the witnesses at the hearing, was persuaded by that explanation. If management officials originally had questioned Mr. Semes, and had believed him, they presumably would have shifted their view, seeing him as an innocent sufferer instead of a malefactor. Even if they doubted or disbelieved him, one wonders whether they would have remained so convinced of the need for dismissal instead of some lesser form of discipline.
Based upon the balancing of these interests just discussed, we conclude that constitutional due process requires that a nonprobationary employee of the national government be given some opportunity to respond to the charges against him before his dismissal may be implemented. We adopt the conclusion of the Loudermill court: "The opportunity to present reasons, either in person or in writing, why propose action should not be taken is a fundamental due process requirement....The tenured public employee is entitled to oral or written notice of the charges against him, an explanation of the employer's evidence, and an opportunity to present his side of the story." 470 U.S. at
546, 105 S. Ct. at 1495, 84 L. Ed. 2d at 506. Only when these conditions are fulfilled may dismissal of a tenured employee of the national government be implemented before termination of the employee's appeal rights.
The remaining question is whether the statute, or part of it, must be set aside as contrary to due process or whether it may be interpreted as assuming, or permitting, observance of constitutional principles in connection with any dismissal before the appeal hearing provided in the Act. Addressing this issue, we begin with a "presumption that Congress was attempting to enact a statute which would meet the basic requirements of procedural due process." Suldan (II), 1 FSM Intrm. at 358.
The National Public Service System Act is silent as to whether a dismissal may be implemented before some kind of hearing is provided. The only pertinent statutory provision says that no dismissal shall be effective "for any purpose" until the employer receives notice of the reasons for dismissal and of the right to appeal. We do not read this as an attempt to authorize immediate dismissal for all purposes without giving the employer a right to respond but instead as an indication of solicitude, demonstrating congressional intention to assure that employees' rights be observed. Thus, implementation of the constitutional requirement that the employee be given an opportunity to respond is consistent with the statutory scheme and the Act need not be set aside as contrary to due process.
Applying the constitutional principles, we find the December 9, 1987 dismissal unconstitutional and ineffective since Mr. Semes' right to continued governmental employment could not be terminated without giving him an opportunity to respond to the charges. The January 20, 1988 recommendation of the ad hoc committee was for reinstatement, so the dismissal still remained ineffective after that recommendation was made. Only when the President issued his decision, on March 15, 1988, did the dismissal take effect.
The findings of the President are supported by substantial evidence and are therefore affirmed. We do not find the dismissal of Mr. Semes beyond the range of allowable discretion available to the President; therefore the appeal on that point also is denied and dismissed.
However, we hold that Mr. Semes remained an employee of the national government up to March 15, 1988 when President Haglelgam issued is decision. The prior attempt to dismiss Mr. Semes on December 9, 1987 was violative of due process and ineffective. This case is remanded to administrative officials for further proceedings, including an award of back pay, consistent with this decision.
So ordered the 19th day of June, 1989.
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1. The appellate division has announced its affirmance of the Falcam trial division decision, although the appellate opinions has not yet released.
2. In Alaphonso v. FSM, 1 FSM Intrm. 209 (1982), we traced the origins of the due process clause, article IV, section 3 of the Constitution, concluding that the clause is modeled upon the United States Constitution. The balancing test applied here is similar to, and drawn from, the approach employed by United States courts in addressing similar issues under the due process clause of the United States Constitution. See Mathews v. Eldrige, 424 U.S. 319, 96 S. Ct. 893, 47 L. Ed. 2d 18 (1976) and Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 105 S. Ct. 1487, 84 L. Ed. 2d 494 (1985).