Opinion
2012-07-26
BELL BEVERAGE, Petitioner v. UNEMPLOYMENT COMPENSATION BOARD OF REVIEW, Respondent.
Daniel J. Sobol, Philadelphia, for petitioner. Shawn J. Jayman, Assistant Counsel, Harrisburg, for respondent.
Daniel J. Sobol, Philadelphia, for petitioner. Shawn J. Jayman, Assistant Counsel, Harrisburg, for respondent.
BEFORE: PELLEGRINI, President Judge and McCULLOUGH, Judge and COVEY, Judge.
OPINION BY Judge McCULLOUGH.
Bell Beverage (Employer) petitions for review of the September 1, 2011, order of the Unemployment Compensation Board of Review (Board) reversing a referee's order denying unemployment compensation benefits to Carlos Falu (Claimant) under section 402(e) of the Unemployment Compensation Law (Law). We vacate and remand the case to the Board for further findings of fact.
Act of December 5, 1936, Second Ex.Sess., P.L. (1937) 2897, as amended, 43 P.S. § 802(e) (stating that employees are ineligible for compensation for any week in which their unemployment is due to discharge from work for willful misconduct connected with their work).
Claimant was employed in Employer's warehouse until November 3, 2010, when his employment was terminated for “theft and conspiracy.” (Board's Findings of Fact, No. 10.) When the local service center denied his claim for benefits, Claimant appealed, and a hearing before a referee was scheduled for February 28, 2011. Steve Bell and Frank Bell, owners of Bell Beverage, testified on behalf of Employer. Claimant did not appear, later asserting that he had not received notice of the hearing.
At the hearing, Steve Bell testified that Employer retained a private investigator to follow its delivery trucks because inventory was missing. (Notes of Testimony (N.T.), 2/28/2011, at 3.) According to Steve Bell, after the investigator discovered that one of Employer's drivers, Ralph Puglia, and Puglia's helper were involved in the theft, Employer decided to put Claimant on the truck with Puglia to see if Claimant was also involved. ( Id.)
Frank Bell testified that, on two separate occasions, the investigator observed Puglia unloading product into his home while Claimant was assigned to Puglia's truck. He further testified that on both occasions the investigator telephoned him as the theft was occurring. (N.T., 2/28/2011, at 3–4.) The first time, Frank Bell immediately telephoned Claimant on his cell phone, but Claimant did not answer. ( Id.) When asked about it later, Claimant said he was sleeping on the truck. ( Id.) The second time, Claimant answered his phone and said that he and Puglia were on the expressway and would be back to the warehouse in a few minutes. ( Id.)
Employer also offered into evidence a letter from the private investigator, Michael Corsaro of Insight Investigations. In pertinent part, the letter reads as follows:
On the dates of 11/1, and 11/3, we observed a Bell [B]everage employee arrive at his given address accompanied by [Claimant] as the passenger. As the driver “Ralph Puglia” commenced in the act of removing beverages from the Bell [B]everage truck and carrying the items into his residence, we noted [Claimant] remain inside the vehicle. On 11/3 we called to inform you that your truck was again outside Ralph Puglia's residence and [Claimant] was in the truck while Ralph Puglia transferred stolen cases from the truck to his residence. While on the phone with you we heard you place a call to [Claimant] and ask “where are you[?]” [Claimant] stated “we just got off the highway and will be back to the warehouse in a few minutes.” At no time did he state his exact physical location nor did he state the actions of Mr. Puglia.
(C.R. 2/28/2011 hearing exhibit E1.)
Corsaro was not present at the hearing to authenticate the letter; however, Claimant was not present to object, and the referee accepted the letter into evidence. Employer also attempted to offer DVD footage taken by Corsaro into evidence. The referee agreed to watch it, but when both witnesses indicated that Claimant was not visible anywhere in the DVD footage, the referee decided there was no need to view it. (N.T., 2/28/2011, at 5.)
In a decision dated March 1, 2011, the referee concluded that Claimant was fired for willful misconduct and, thus, was ineligible for benefits under section 402(e) of the Law. Claimant appealed to the Board, contending that he never received notice of the February 28, 2011, hearing.
Although Claimant was appealing on the basis that he had not been notified of the referee's February 28, 2011, hearing, the Board directed the referee to schedule another hearing for the sole purpose of allowing Employer to submit its DVD evidence. At the remand hearing, Employer played a DVD containing three separate files of footage taken on October 29, 2010; November 1, 2010; and November 3, 2010. (N.T., 7/28/2011, at 5–7.) Frank Bell testified that the recordings were made by the private investigator and contained footage from the two above-described incidents. ( Id. at 5–6.) Corsaro again was not present at the hearing to authenticate the DVD. Claimant, who was unrepresented, did not object to admission of the DVD evidence; however, he pointed out more than once that he did not see himself in the DVD. ( Id. at 5–7.)
The referee noted at the July 28, 2011, hearing that this direction was “a little odd” but stated that Claimant “presumably” was to give testimony at the remand hearing also. (N.T., 7/28/2011, at 2–3.) Ultimately, the Board discredited Claimant's assertions that he did not receive notice of the first hearing, and did not consider the testimony he gave at the remand hearing. (Board's op. at 2.)
The two DVD files relevant to this case were shot from behind a white box truck with “Bell Beverage” written on it. The footage shows only one person, presumably Frank Puglia, carrying product from the truck into a private residence. It is impossible to see who, if anyone, was sitting in the cab of the truck at the time. (C.R.DVD.)
Subsequent to the remand hearing, the Board made the following findings of fact:
1. The claimant was last employed doing warehouse work by Bell Beverage for approximately 10 years and his last day of work was November 3, 2010.
2. The claimant would also help the employer's drivers when they would make deliveries.
3. The employer hired a private investigator after it became aware that it was missing inventory.
4. The private investigator followed the employer's trucks during deliveries.
5. Beer was being transferred to a driver's residence.
6. During the last occasion, the private investigator contacted the employer and allegedly informed the employer that the truck was parked outside the driver's residence, and that the claimant was allegedly in the truck.
7. On November 3, 2010, the investigator called the employer to state that the driver was allegedly unloading product at his home. Around the same time that the investigator allegedly contacted the employer, the employer called the claimant's cell phone; he answered it, and stated that the driver and he were on their way back to the warehouse.
8. One of the employer's owners questioned the claimant after the second incident, and specifically asked the claimant if he was aware if any theft was taking place at the business.
9. The claimant informed the owner that he did not see any theft.
10. The employer's owner informed the claimant and the driver that they were being terminated.
11. The employer's owner explained his reason for termination and asked if they had an explanation.
12. The claimant did not offer an explanation.
13. The claimant was discharged for theft and conspiracy.
(Board's op. at 1–2.)
In reaching these findings, the Board did not consider any of Claimant's testimony because it discredited Claimant's assertion that he had not received notice of the first hearing. (Board's op. at 3.) With regard to Employer's evidence, the Board considered only the testimony regarding the DVD, determining that any additional testimony was outside the scope of the remand hearing. ( Id.) The Board concluded that Employer's testimony concerning information from its private investigator was hearsay and observed as follows:
Hearsay is defined as a “statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” Pa.R.E. 801(c). Hearsay is not admissible except as provided by the Pennsylvania Rules of Evidence, other rules prescribed by the Pennsylvania Supreme Court, or by statute. Pa.R.E. 802.
In this case, [Employer] testified that it received information from its private investigator. [Employer's] testimony in this regard is hearsay because the private investigator did not testify at the hearing. Moreover, the DVDs entered into the record do not establish that the claimant committed theft or conspired to commit theft.
( Id.) Accordingly, the Board stated that it was “constrained” to grant benefits to Claimant because Employer failed to meet its burden of proving that Claimant was fired for willful misconduct. ( Id.)
On appeal to this Court, Employer argues that the Board erred in ruling that Frank Bell's testimony regarding information he received from Corsaro was inadmissible hearsay because Corsaro's statements during the two phone calls in question fall under the “present sense impression” exception to the hearsay rule. (Employer's brief at 12.) We agree.
Our scope of review is limited to determining whether constitutional rights were violated, an error of law was committed, or findings of fact were unsupported by substantial evidence. Section 704 of the Administrative Agency Law, 2 Pa.C.S. § 704.
Pennsylvania Rule of Evidence 803 provides as follows:
Rule 803. Hearsay exceptions; availability of declarant immaterial.
The following statements, as hereinafter defined, are not excluded by the hearsay rule, even though the declarant is available as a witness:
(1) Present sense impression. A statement describing or explaining an event or condition made while the declarant was perceiving the event or condition, or immediately thereafter....
Pa.R.E. 803(1) (emphasis added).
A present sense impression is not excluded under the hearsay rule because there is implicit reliability in a statement made “without time for retrospective deliberation.” Municipality of Bethel Park v. Workmen's Compensation Appeal Board (Willman), 161 Pa.Cmwlth. 274, 636 A.2d 1254, 1258 (1994). Further, Pa.R.E. 803(1) specifically provides that this exception applies, “even though the declarant is available as a witness.”
In Bethel Park, this Court applied the present sense impression exception in a workers' compensation case, noting that the “assured reliability of a statement comes from it being made without time for retrospective deliberation.” In Bethel Park, the widow of a police officer who died from a heart attack sought relief under the Workers' Compensation Act. The only evidence available to establish that the decedent died in the course and scope of his employment were statements he made to his wife about his activities immediately before he collapsed. This Court concluded that the decedent's statements to his wife were made close enough in time to fall within the present sense impression exception to the hearsay rule. In discussing the history of this exception, the Court noted that the present sense impression exception was slow in developing from the time the exception was first espoused by Professor James Thayer in 1881:
Act of June 2, 1915, P.L. 736, as amended,77 P.S. §§ 1–1041.4, 2501–2708.
Our Supreme Court first employed the exception in Commonwealth v. Coleman, 458 Pa. 112, 326 A.2d 387 (1974), a plurality opinion which relied on [an article by Edmund] Morgan and Federal Rule of Evidence 803(1) for the proposition that there should be a hearsay exceptionfor declarations concerning non-exciting events either made contemporaneously or immediately after the event is perceived. In Coleman, a murder victim's mother testified to the contents of a telephone conversation she had with the victim in which the victim indicated that the appellant was going to disconnect the telephone and kill her. The plurality adopted the Morgan rational[e] that the assured reliability of a statement comes from it being made without time for retrospective deliberation and found that the conversation was a contemporaneous account of the event taking place. However, without stating that anything other than this contemporaneousness was required, the Court went on to note that the appellant's admission that he had argued with the deceased and the mother's hearing his voice in the background corroborated the hearsay declaration.
We stated in Bethel Park that:
What caused the exception's widespread acceptance was an article by Edmund Morgan, Res Gestae, 12 Wash. L.Rev. 91 (1928), in which he advocated that exception be made for all spontaneous statements based solely on the contemporaneousness factor:
The declaration is ‘instinctive rather than deliberative—in short, the reflex product of immediate sensual impressions, unaided by retrospective mental action. These are the indicia of verity which the law accepts as a substitute for the usual requirements of an oath and opportunity for cross-examination.’
Bethel Park, 636 A.2d at 1257.
The exception was not officially adopted by the Supreme Court until its decision in Commonwealth v. Peterkin, 511 Pa. 299, 513 A.2d 373 (1986), cert. denied, 479 U.S. 1070, 107 S.Ct. 962, 93 L.Ed.2d 1010 (1987), when, citing Coleman, the Court held that a description of a non-exciting event made either during the event or immediately thereafter was to be admissible under the present sense impression exception. There, the Court made no mention of whether there was any corroboration to the statement and relied solely on its contemporaneousness....
We believe that in Peterkin, our Supreme Court adopted the rational[e] that contemporaneousness alone insures reliability sufficient to counterbalance a statement's hearsay nature. Accordingly, whether a statement comes within the present sense impression exception depends solely on whether it was made contemporaneously with the event described and there is no requirement of corroborating evidence.
Bethel Park, 636 A.2d at 1258 (citations omitted) (emphasis added).
Thus, this Court clearly held in Bethel Park that it is the timing or contemporaneous nature of the statement that is controlling. No corroborating evidence is required.
The Superior Court similarly interpreted Pa.R.E. 803(1) in Commonwealth v. Cunningham, 805 A.2d 566 (Pa.Super.2002), where the appellant conceded that a transcript of a 911 call made to police by roofers who were working nearby and saw a robbery unfolding was properly admitted under the present sense impression exception to the hearsay rule. The Superior Court agreed and held that because the statements fell within the exception to the hearsay rule and were reliable, there was no violation of the appellant's right to confront the witness, even where the declarant is available as a witness. Id. at 573. Hence, the declarants themselves were not required to testify.
This same rationale applies sub judice. The observations conveyed by Corsaro over the telephone to Frank Bell were reliable because they were contemporaneously made as the event was unfolding. Bethel Park. Thus, Frank Bell's testimony concerning Corsaro's statement was admissible under the present sense impression exception. Moreover, because Pa.R.E. 803(1) provides that the availability of the declarant is immaterial, we conclude that the Board erred in rejecting Frank Bell's testimony on this subject as inadmissible hearsay.
As the Superior Court noted in Cunningham:
The comment to the rule states that this exception can apply even when the declarant is not excited or otherwise emotionally affected by the event or condition perceived. Also, the comment states that the trustworthiness of the statement arises from its timing. The comment further indicates that the requirement of contemporaneousness, or near contemporaneousness, reduced the chance of premeditated prevarication or loss of memory.
Cunningham, 805 A.2d at 572 n. 1.
Employer also argues that even if Frank Bell's testimony was inadmissible hearsay, it was not objected to and therefore is admissible because it is corroborated by the DVD footage. However, having concluded that Frank Bell's testimony was not inadmissible hearsay, we need not address this issue.
Employer next contends that the private investigator's letter to Employer is admissible as a business record under section 6108(b) of the Uniform Business Records as Evidence Act, 42 Pa.C.S. § 6108(b). Initially, we note that the Board did not specifically reject the letter as hearsay. The Board only rejected Employer's testimony regarding information received from the investigator. However, we agree with Employer that the letter was properly admitted into evidence and should have been considered by the Board, not because it was admissible under the Uniform Business Records as Evidence Act, but because it was unobjected-to hearsay corroborated by Frank Bell's testimony.
.Section 6108(b) of the Uniform Business Records as Evidence Act provides:
A record of an act, condition or event shall, insofar as relevant, be competent evidence if the custodian or other qualified witness testifies to its identity and the mode of its preparation, and if it was made in the regular course of business at or near the time of the act, condition or event, and if, in the opinion of the tribunal, the sources of information, method and time of preparation were such as to justify its admission. 42 Pa.C.S. § 6108(b).
Although business records can be admissible, they must be authenticated by a witness who can “provide sufficient information relating to the preparation and maintenance of the records to justify a presumption of trustworthiness of the business records of a company.” Virgo v. Workers' Compensation Appeal Board (County of Lehigh–Cedarbrook), 890 A.2d 13, 20 (Pa.Cmwlth.2005). See also Turner v. Unemployment Compensation Board of Review, 899 A.2d 381 (Pa.Cmwlth.2006). Here, no one from Insight Investigations appeared to authenticate the letter. Frank Bell is a client, not an employee, of Insight Investigations and therefore has no ability to provide any testimony related to the preparation of the letter that could justify a presumption of its trustworthiness or reliability.
In unemployment compensation proceedings, hearsay evidence admitted without objection will be given its natural probative effect and may support a finding of the Board as long as it is corroborated by other competent evidence in the record. Walker v. Unemployment Compensation Board of Review, 27 Pa.Cmwlth. 522, 367 A.2d 366 (1976). Here, Claimant was not present at the February 28, 2011, hearing and therefore did not object to the letter, which the referee accepted as Employer's exhibit E–1. Further, Frank Bell's testimony about the two phone calls he received from Corsaro suffices to corroborate Corsaro's letter. Thus, the letter was properly admitted and should have been considered by the Board.
Finally, having determined that both Frank Bell's testimony and Corsaro's letter were admissible, we address Employer's assertion that the Board erred in concluding that Employer failed to meet its burden of proving that Claimant was fired for willful misconduct.
The Law does not define “willful misconduct,” but our courts have defined the term as including a wanton and willful disregard for an employer's interests, a deliberate violation of an employer's rules, a disregard for the standards of behavior that an employer can rightfully expect of an employee, or negligence indicating an intentional disregard of the employer's interests or the employee's duties and obligations. On Line, Inc. v. Unemployment Compensation Board of Review, 941 A.2d 786, 789 (Pa.Cmwlth.2008). “An employee's theft from an employer is willful misconduct. An act of theft disregards the employer's interests and the standards of behavior that the employer has a right to expect of an employee.” Id. at 790.
The question of whether Employer has shown willful misconduct is a question of law fully reviewable by this Court. Pennsylvania Engineering Corp. v. Unemployment Compensation Board of Review, 46 Pa.Cmwlth. 305, 405 A.2d 1387 (1979). However, the Board is the ultimate finder of fact, empowered to resolve conflicts in evidence, assess the credibility of witnesses, and determine the weight of evidence. Unemployment Compensation Board of Review v. Wright, 21 Pa.Cmwlth. 637, 347 A.2d 328 (1975). Here, the Board did not make findings of fact necessary for this Court to rule on whether Employer met its burden of proof under section 402(e). Specifically, the Board issued no findings as to whether Claimant was on the truck while the theft was occurring; whether Claimant knew or should have known that the theft was taking place; whether Claimant was involved in the theft; or whether Claimant lied to Frank Bell during the telephone call on November 3, 2010. Where, as here, the Board's findings of fact are insufficient as a matter of law to establish the legal conclusions necessary to resolve a case, the case must be remanded to the Board for the making of new and adequate findings. See Stana v. Unemployment Compensation Board of Review, 791 A.2d 1269 (Pa.Cmwlth.2002) (holding that remand was required to determine whether the claimant's appeal should be allowed nunc pro tunc, where the findings adopted by the Board did not include credibility determinations or other finding regarding the claimant's excuse for her untimely appeal).
Accordingly, we vacate the Board's September 1, 2011 order, and remand the case to the Board for a new decision containing additional findings of fact based on the existing record.
ORDER
AND NOW, this 26th day of July, 2012, the September 1, 2011, order of the Unemployment Compensation Board of Review is hereby vacated, and the case is remanded to the Board for a new decision with additional findings of fact in accordance with the foregoing opinion.
Jurisdiction relinquished. DISSENTING OPINION BY President Judge PELLEGRINI.
Ignoring that the Pennsylvania Rules of Evidence do not apply to administrative proceedings, I respectfully dissent because I would hold that “present sense impression' ” of declarant employed to secure evidence does not fall within any exception to the hearsay rule.
Before the Board, the only evidence that established that Claimant was ineligible for benefits due to willful misconduct was testimony from Employer's owners of two telephone conversations that they had with a private investigator that they employed to investigate employee theft. They testified that the private investigator telephoned them on two separate occasions and told them that he was observing the driver of a delivery truck stealing beverages, while Claimant, a helper, sat in the truck.
The Board found that the evidence was precluded as hearsay and found that the Employer failed to meet its burden of establishing willful misconduct and awarded benefits. The majority reverses finding that it was an exception to the hearsay rule as a “present sense impression” under Pa. R.E. 803(1).
Pa. R.E. 803(1) provides that statements are not excluded as hearsay, even though the declarant is available as a witness, when the “statement describing or explaining an event or condition made while the declarant was perceiving the event or condition, or immediately thereafter.” The rationale for the “present sense impression” exception to the hearsay rule is that the relative immediacy of the declaration insures that there will have been little opportunity for reflection or calculated misstatement. Com. v. Hood, 872 A.2d 175 (Pa.Super.2005).
Because those hired to procure evidence have a financial incentive and the opportunity to reflect and make calculated misstatements, I would hold that a statement made by a private investigator or anyone paid to obtain evidence over the telephone does not fall within Pa. R.E. 803(1). Accordingly, I would affirm the Board.