in the Court of Appeals 3 October 2016.
by respondent from final decision entered 25 January 2016 by
Administrative Law Judge Donald W. Overby in the Office of
Administrative Hearings, No. 15 OSP 05500.
Offices of Michael C. Byrne, by Michael C. Byrne, for
Attorney General Roy Cooper, by Assistant Attorney General
Tamika L. Henderson, for respondent.
North Carolina Department of Public Safety
("Respondent") appeals from a final decision of the
North Carolina Office of Administrative Hearings, which
concluded as a matter of law that Respondent lacked just
cause to terminate Steven Harris ("Petitioner")
from his position as a correctional officer, and ordering his
reinstatement. We affirm the decision of the administrative
began working in February 2013 as a correctional officer at
Maury Correctional Institution ("Maury
Correctional"), a state prison operated by Respondent.
Petitioner attended Respondent's basic training program
and continued to be trained annually regarding
Respondent's policies and procedures, including its Use
of Force policy. Petitioner's personnel record contained
no disciplinary action prior to the incident at issue.
was working the night shift at Maury Correctional on 5
February 2015. He was working in the "Gray Unit, "
which housed the prison's segregation cell block. Inmate
Christopher Walls ("Walls") was housed on the Gray
Unit. Walls placed his feces into a plastic bag and placed
the bag into the toilet, which caused water to leak onto the
floor. Walls then poured the feces onto the floor. In
response to Walls' actions, Sergeant Vernell Grantham
ordered Ronnie Johnson ("Officer Johnson"), Devon
Alexander ("Officer Alexander"), and Dominique
Sherman ("Officer Sherman") (together "the
officers") to remove Walls from his cell to allow a
janitor to clean up the feces and extinguish the stench.
officers restrained Walls with handcuffs behind his back, a
waist chain, and leg cuffs. Petitioner was not tasked with
transporting Walls from his cell to another location.
Officers Johnson, Alexander, and Sherman testified Petitioner
approached Walls, stated to him: "You think this is
funny" and punched Walls in the stomach. Walls was
physically restrained, compliant, and under the other
officers' control at the time Petitioner punched Walls.
The officers each testified that Walls did not attempt to
spit on Petitioner and was not offering any resistance at the
time Petitioner punched him. While the Gray Unit is equipped
with several security cameras, the incident was not captured,
because it occurred in a blind spot inside the facility.
Officer Johnson became upset and informed Petitioner that he
was going to report him for punching the inmate.
the inmate, stated to Sergeant Grantham, "Y'all hit
like bitches." Less than thirty minutes after the
incident occurred, Walls was taken to and screened by medical
personnel, who observed no bruising or redness on his
abdomen. At no point in time did Walls complain that
Petitioner had struck him or abused him in any way.
the incident was reported, Respondent conducted an internal
investigation, concluded Petitioner had violated
Respondent's Use of Force policy, and recommended
corrective action. Petitioner received a written notice,
dated 14 April 2015, of a pre-disciplinary conference with
Administrator Dennis Daniels and Administrative Services
Manager Gary Parks, to be held the following day. The written
notice stated the conference was to discuss a recommendation
for Respondent to terminate Petitioner from his position for
"unacceptable personal conduct." Petitioner was
provided with the reasons his termination was recommended and
was given an opportunity to respond to the allegations.
the conference, Respondent's management approved the
recommendation to terminate Petitioner's employment.
Petitioner was notified by letter dated 17 April 2015 that
his employment was terminated for unacceptable personal
conduct. Petitioner filed an appeal with the Employee
Advisory Committee, which recommended Petitioner's
dismissal be upheld. Respondent notified Petitioner by letter
dated 29 June 2015 of its final agency decision upholding
filed a petition for a contested case hearing with the Office
of Administrative Hearings ("OAH"). The case was
heard before an Administrative Law Judge ("the
ALJ") on 23 October 2015. Following that hearing, the
ALJ issued a final decision on 25 January 2016. The final
decision contained twenty-seven findings of fact. Utilizing
the framework established by our Supreme Court in N.C.
Dep't of Env't & Natural Res. v. Carroll,
358 N.C. 649');">358 N.C. 649, 599 S.E.2d 888 (2004) and by this Court in
Warren v. N.C. Dep't of Crime Control, 221 N.C.
App 376, 726 S.E.2d 920, disc. review denied, 366
N.C. 408, 735 S.E.2d 175 (2012), the ALJ concluded as a
matter of law that "[t]o the extent . . .
Petitioner's conduct [punching Walls in his stomach]
constituted unacceptable personal conduct, it does not rise
to the level of conduct that would justify the severest
sanction of dismissal under the totality of facts and
circumstances of this contested case" and that
"[i]t is not 'just' to terminate
reversed Respondent's decision to terminate
Petitioner's employment, ordered Petitioner to be
retroactively reinstated to his position of employment, and
ordered a deduction from Petitioner's pay, equivalent to
a one-week suspension. Respondent appeals.
to N.C. Gen. Stat. § 7A-29(a) (2015), an appeal as of
right lies directly to this Court from a final decision of
the Office of Administrative Hearings under G.S. 126-34.02.
Respondent's appeal is properly before us.
argues: (1) the ALJ erred as a matter of law by concluding
Respondent failed to establish just cause to dismiss
Petitioner for unacceptable personal conduct; (2) the ALJ
erred as a matter of law by substituting his own judgment for
that of Respondent and imposing new discipline upon
Petitioner; (3) certain findings of fact and conclusion of
law of the ALJ are not supported by substantial evidence, are
unsupported by the findings of fact, or are affected by an
error of law; and, (4) the ALJ erred as a matter of law by
excluding evidence that was not specifically mentioned in
Respondent's dismissal letter to Petitioner.
Just Cause for Dismissal
argues the ALJ erred by concluding Respondent failed to
establish just cause for Petitioner's dismissal. We
Statutory Scheme and Standard of Review for Determining Just
2013, our General Assembly significantly amended and
streamlined the procedure governing state employee grievances
and contested case hearings, applicable to cases commencing
on or after 21 August 2013. See generally 2013 N.C.
Sess. Laws ch. 382. Our Supreme Court explained the previous
statutory framework in detail in Carroll, 358 N.C.
at 657-58, 599 S.E.2d at 893-94.
career state employee who alleged he was dismissed, demoted,
or suspended without pay without just cause under N.C. Gen.
Stat. § 126-35 was first required to "pursue any
grievance procedures established by the employing agency or
department." Id. at 657, 599 S.E.2d at 893
(citations omitted). Once those internal grievance procedures
were exhausted, the aggrieved employee could demand a formal,
quasi-judicial evidentiary hearing before an ALJ by filing a
contested case petition with the Office of Administrative
Hearings. Id. The ALJ issued a "recommended
decision, " and each party was entitled to pursue an
administrative appeal by filing exceptions and written
arguments with the State Personnel Commission
("SPC"). Id. at 657, 599 S.E.2d at 893-94.
issued its final agency decision based on its "review of
the parties' arguments and the materials preserved in the
official record[.]" Id. at 658, 599 S.E.2d at
894. The SPC was authorized "to reinstate a wrongfully
terminated employee and to order a salary adjustment or other
suitable action to correct an improper disciplinary
action." Id. (citation omitted). The SPC's
decision was subject to judicial review upon the petition of
either the employee or the employing agency in the superior
court. Id. (citation omitted). The superior
court's decision was subject to further review in the
appellate division. Id. (citation omitted).
of the 2013 amendments, the General Assembly enacted N.C.
Gen. Stat. §§ 126-34.01 and 126-34.02 into the
North Carolina Human Resources Act. Under N.C. Gen. Stat.
§ 126-34.01 (2015), a State employee "having a
grievance arising out of or due to the employee's
employment" must first discuss the matter with the
employee's supervisor, and then follow a grievance
procedure approved by the North Carolina Human Resources
Commission. The agency will issue a final decision, approved
by the Office of State Human Resources. Id. While a
final agency decision under the previous statutory framework
included formal findings of fact and conclusions of law, a
final agency decision under the current framework simply
"set[s] forth the specific acts or omissions that are
the basis of the employee's dismissal." 25 NCAC 01J
final agency decision is issued, a potential, current, or
former State employee may appeal an adverse employment action
as a contested case pursuant to the method provided in N.C.
Gen. Stat. § 126-34.02 (2015). As relevant to the
present case, N.C. Gen. Stat. § 126-34.02(a) provides:
(a) [A] former State employee may file a contested case in
the Office of Administrative Hearings under Article 3 of
Chapter 150B of the General Statutes. . . . In deciding cases
under this section, the [ALJ] may grant the following relief:
(1) Reinstate any employee to the position from which the
employee has been removed.
(2) Order the employment, promotion, transfer, or salary
adjustment of any individual to whom it has been wrongfully
(3) Direct other suitable action to correct the abuse which
may include the requirement of payment for any loss of salary
which has resulted from the improper action of the appointing
the issues, which may be heard as a contested case under this
statute, is whether just cause existed for dismissal,
demotion, or suspension. As here, "[a] career State
employee may allege that he or she was dismissed, demoted, or
suspended for disciplinary reasons without just cause."
N.C. Gen. Stat. § 126-34.02(b)(3). In such cases,
"the burden of showing that a career State employee was
discharged, demoted, or suspended for just cause rests with
the employer." N.C. Gen. Stat. § 126-34.02(d). In a
contested case, an "aggrieved party" is entitled to
judicial review of a final decision of an administrative law
judge [ALJ] by appeal directly to this Court. N.C. Gen. Stat.
§ 126-34.02(a); N.C. Gen. Stat. § 7A-29(a).
Chapter 126 is silent on the issue, Chapter 150B, the
Administrative Procedure Act, specifically governs the scope
and standard of this Court's review of an administrative
agency's final decision. See Overcash v. N.C.
Dep't of Env't & Natural Res., 179 N.C.App.
697, 702, 635 S.E.2d 442, 446 (2006), disc. review
denied, 361 N.C. 220 (2007). Article 4 of Chapter 150B
is entitled "Judicial Review, " and includes N.C.
Gen. Stat. § 150B-43:
[a]ny . . . person aggrieved by the final decision in a
contested case, and who has exhausted all administrative
remedies made available to the . . . person aggrieved by
statute or agency rule, is entitled to judicial review of the
decision under this Article, unless adequate procedure
for judicial review is provided by another statute.
N.C. Gen. Stat. § 150B-43 (2015) (emphasis supplied).
150B also includes Section 51, which is entitled "Scope
and standard of review." N.C. Gen. Stat. § 150B-51
(2015). The statute provides:
The court reviewing a final decision may affirm the decision
or remand the case for further proceedings. It may also
reverse or modify the decision if the substantial rights of
the petitioners may have been prejudiced because the
findings, inferences, conclusions, or decisions are:
(1) In violation of constitutional provisions;
(2) In excess of the statutory authority or jurisdiction of
the agency or administrative law judge;
(3) Made upon unlawful procedure;
(4) Affected by other error of law;
(5) Unsupported by substantial evidence admissible under G.S.
150B-29(a), 150B-30, or 150B-31 in view of the entire ...