Bullock v. Cit Co. Federal Credit Union

SHEPARD, Justice. This is an appeal from the Industrial Commission’s denial of claimant’s application for unemployment compensation. The commission found that claimant had acted in wilful disregard of the interest of the employer and that claimant was terminated for misconduct. We affirm. Misconduct under I.C. § 72-1366(e) has been defined as “wilful, intentional disregard of the employer’s interest; a deliberate violation of the employer’s rules; or a disregard of standards of behavior which the employer has a right to expect of his employees.” Johns v. S.H. Kress & Company, 78 Idaho 544, 548, 307 P.2d 217, 219 (1957); accord, Parker v. St. Maries Plywood, 101 Idaho 415, 614 P.2d 955 (1980); Ortiz v. Armour & Co., 100 Idaho 363, 597 P.2d 606 (1979). See also Avery v. B & B Rental Toilets, 97 Idaho 611, 549 P.2d 270 (1976). [768] The essence of claimant’s argument upon appeal is that the commission erred in certain of its factual findings, specifically, in its findings that the person giving claimant an “order” had authority to supervise claimant; that claimant refused to obey the order; and that claimant’s refusal was an action in wilful disregard of the interest of the employer. Claimant worked for eleven years at CIT Company, a federal credit union which employed only one person, the claimant, as a full-time employee. At the time of her termination, claimant was manager of the credit union and, as such, was responsible for the company records and books. In March of 1981, a federal examiner had audited the company’s books and found numerous deficiencies. The examiner rated the company as a “4” on a scale of one to five, with one being the best rating and liquidation following from the receipt of a five rating. The examiner said that the problems discovered in the audit were capable of correction and hence he rated the company a four instead of a five, but he also said that he would conduct another audit shortly to determine if the deficiencies had been corrected. The office of the credit union was to be closed for the first two weeks in July to allow claimant to close out the books. In previous years during such book closure period, claimant had worked nights, and she followed that practice in July 1981. On the night of July 5, claimant worked from 11:00 p.m. until 6:30 a.m. Credit unions receive no advance warning of audits by federal examiners. On July 6, the examiner decided to conduct his audit, but he found the office closed. The federal examiner called the president of the board of directors of the credit union, who in turn called the claimant. A discussion ensued between claimant and the president, and the testimony reflects differing versions of that discussion. The commission found that claimant had violated a direct order from the president in refusing to open the office to the federal examiner. The board of directors of the credit union met and voted to discharge the claimant, giving four reasons therefor. Only one of these reasons, i.e., claimant’s failure to open the credit union on July 6, was found by the commission to justify the action of the board.1 It is axiomatic that Industrial Commission’s findings of fact are entitled to deference and will not be overturned absent a clear abuse of discretion. Parker v. St. Maries Plywood, supra; Guillard v. Department of Employment, 100 Idaho 647, 603 P.2d 981 (1979); Bentley v. Bunker Hill Co., 100 Idaho 571, 602 P.2d 69 (1979). See Idaho Const, art. 5, § 9. We hold that the commission’s finding that the president of the board of directors had informally been given supervisory authority over the claimant is substantially supported by the testimony in the record here. We further hold that the testimony before the commission is sufficient to support the finding that claimant refused to carry out the direct order of Nate Palagi, the president of the board of directors, instructing [769] claimant to open the office for the federal examiner.2 Under the circumstances, as noted by the findings adopted by the commission, there existed necessitous reasons for opening the office for audit by the federal examiner; to not cooperate with the auditor was conducive to a risk of liquidation of the credit union. Hence, we hold that the commission’s finding that the claimant acted in wilful disregard of the interest of the employer is sustained. The decision of the Industrial Commission is affirmed. Costs to respondent CIT Co. Federal Credit Union. No attorneys’ fees allowed on appeal. DONALDSON, C.J., and BAKES and HUNTLEY, JJ., concur. Footnotes [1] "The Referee agrees with the claimant that the president technically had not been delegated the authority to direct the claimant to open the office. However, consideration of the matter does not end there. The Referee finds that the following circumstances are particularly relevant: an audit was conducted in March by a federal examiner who found serious deficiencies in the operations of the credit union; the examiner notified the credit union that he would conduct another audit in the future to determine if the deficiencies had been corrected; if the deficiencies were not corrected, the credit union could be liquidated; audits must be conducted without prior notice so that the books are not altered; and the claimant was aware of the importance of establishing a good rapport with the examiner. These circumstances establish overwhelming reasons for opening the office for the examiner. The claimant's failure to open the office or arrange for it to be opened after two requests from the president of the board was a wilful disregard of the employer’s interests and a disregard of the standards of behavior an employer has a right to expect of its employees. Therefore, the claimant’s unemployment is due to the fact that she was discharged for misconduct in connection with her employment, so she is not eligible for unemployment benefits.” [2] "Q. ... Okay, at any rate, as I understand it, Mr. Palagi, whom you knew to be the president of the board of directors of the CIT Co Federal Credit Union, called you up on July the 6th, 1981, and asked you to go down and open up the CIT CO Federal Credit Union for the purpose of allowing the federal examiner to go down and examine the books, isn't that correct? "A. That’s right. "Q. And you refused to do that? “A. I gave him reason why I did not want to go down. "Q. Could the witness be instructed to answer the question? “A. Yes, I did. ****** “Q. [The federal examiner] called the President of the Board of Directors? "A. He called several people. "Q. Let’s zero in on Mr. Palagi. He called Mr. Palagi, did he not? "A. Yes, he did. "Q. And Mr. Palagi in turn asked you to open up the doors to the credit union? “A. Yes, he did. "Q. And you refused? “A. That is correct.”