vs. ) CASE NO. 95-0711
) THEOPHILIS J. KAKLIS, )
Respondent. )
Final hearing was held on April 13, 1995, in Cape Coral, Florida, before Robert E. Meale, Hearing Officer of the Division of Administrative Hearings.
The parties were represented at the hearing as follows: Petitioner: Peter W. Zinober
Zinober & McCrea, P.A.
Respondent: Mark F. Kelly
Kelly & McKee, P.A.
The issue is whether Respondent violated various laws and policies applicable to his employment with Petitioner and, if so, what discipline should be imposed.
By letter dated January 24, 1995, Petitioner informed Respondent that he was terminated from his employment with the City. Respondent demanded an evidentiary hearing.
At the hearing, each party called six witnesses. Petitioner offered into evidence 41 exhibits, which were all admitted except for Petitioner Exhibit 31. Respondent offered 10 exhibits, which were all admitted.
The City Ordinance authorizing the hearing requires a decision within 10 days of the hearing, leaving no time for the preparation of a transcript or proposed final orders.
Petitioner hired Respondent in 1977 as Personnel Director. In 1988, Respondent was promoted to City Manager or Acting City Manager.
In 1992, Petitioner hired David Sallee as City Manager. At that time, Petitioner appointed Respondent as Assistant City Manager, where he served until his discharge on January 24, 1995.
When Mr. Sallee was hired, he spoke with Respondent about his outside consulting business. It was no secret that Respondent had for several years advised area fire departments about labor relations. Mr. Sallee informed Respondent that he could still do so as long as he did not do so on City time and he continued to represent only management.
In October 1994, a local news reporter contacted Mr. Sallee and told him that the reporter had evidence that Respondent had been conducting personal business on City time. Mr. Sallee asked for and received the evidence that the reporter had uncovered. Mr. Sallee ordered the commencement of an investigation.
Following the investigation, by letter to Respondent dated January 9, 1995, Mr. Sallee stated that he was considering disciplinary action, up to discharge, for misuse of City property, especially telephones. The letter advises that the misuse of City property may have violated Ordinance 50-94, Article 7.C.13, 7.C.20, 7.C.21, 7.C.24, 7.C.33, 7.C.34, and 7.C.35. The letter also charges Respondent with conduct unbecoming a City employee, in violation of Ordinance 9-81, Section 2.10, and misuse of official position for personal gain, in violation of Section 112.313(6), Florida Statutes.
Acknowledging an earlier request by Respondent, the January 9 letter schedules a Predisciplinary Conference and confirms that Respondent would remain on administrative leave with pay pending the outcome of the Predisciplinary Conference.
By letter dated January 24, 1995, Mr. Sallee provided Respondent with Final Notice of Disciplinary Action. The letter states that Respondent is being discharged on four grounds. First, the January 24 letter asserts that Respondent repeatedly made unauthorized telephone calls at the expense of the City for the past two years, mostly during normal working hours. The letter notes that Respondent spent considerable time on his consulting business and misused the telephone for personal calls while away on City business. The letter claims that Respondent thereby violated Ordinance 50-94, Article 7.C.13, 7.C.20, 7.C.21, 7.C.24, 7.C. 33, 7.C.34, and 7.C.35; Ordinance 9-81, Section 2.10; and Section 112.313(6), Florida Statutes.
Second, the January 24 letter asserts that Respondent used the City fax machine during normal business hours to transmit information to, and receive information from, the Estero Fire Department and Bonita Springs Fire Department. The letter alleges that the transmitted information concerned Respondent's consulting business. The letter claims that Respondent thereby violated the above-cited provisions of law.
Third, the January 24 letter states that Respondent attended meetings at the Estero Fire Department and Bonita Springs Fire Department during regular
City business hours on at least seven occasions, but turned in leave slips only for four of the days. The letter claims that Respondent thereby violated the above-cited provisions of law.
Fourth, the January 24 letter asserts that Respondent made an excessive number of one- and two-minute telephone calls to a person known as "Junior" in Ft. Lauderdale. Most of the calls were on a City cellular phone. The letter alleges that "Junior" was an employee of Calder Race Course until he was laid off in January 1994 and that none of the calls lasted over two minutes. The letter claims that Respondent thereby violated the above-cited provisions of law.
Warning that the investigation is ongoing, the January 24 letter nonetheless advises Respondent that his employment was terminated at 5:00 pm on January 24.
From January 19 through November 15, 1994, Respondent made 6.5 hours of personal telephone calls to representatives of the Estero Fire Department or Bonita Springs Fire Department in connection with Respondent's outside consulting business. These were local calls made from Respondent's City telephone in his office in City Hall.
During the same period of time, Respondent made 7.5 hours of long distance telephone calls from the same City phone. The long distance calls were not pursuant to City business. The calls were to a variety of friends, family, and associates of Respondent's outside business interests. Seven or eight calls of short duration were to a friend known as "Junior" in Southeast Florida, with whom Respondent consulted concerning bets that Respondent placed on the outcomes of horse races. Respondent did not reimburse the City for these calls. The unauthorized use of long distance services cost the City $66.24, exclusive of lost compensation paid Respondent.
During the same period of time, Respondent used his City-provided cellular telephone about 85 percent of the time for personal calls or calls involving Respondent's outside business interests. During this time, Respondent reimbursed the City for less than 4 percent of these calls. For the unreimbursed calls, the unauthorized use of cellular telephone services cost the City about $1700, exclusive of lost compensation paid Respondent.
During the same time period, Respondent received the overwhelming majority of the telephone calls from the Bonita Fire Department and the Bonita Springs Fire Department during normal City hours as opposed to after hours when Respondent was at home. This is indicative of the fact that Respondent performed nearly all of his telephone consultation work for the fire departments on City time.
During the four-year period ending with his termination, Respondent used the City fax machine for personal use a number of times. Respondent sent about two dozen faxes on the City fax machine, typically a couple of pages in length, to business associates, friends, and family members, with most of them involving his fire department consultation business. At the same time, Respondent received about 50 faxes of the same length on the City fax machine concerning his fire department consulting business.
A memorandum dated October 1, 1992, states that employees may not make personal long distance calls on City telephones except in an emergency, in which case they must reimburse the City. An administrative regulation dated July 15,
1992, informs all employees that they could use City equipment only for conducting City business and the use of such equipment for personal purposes is grounds for disciplinary action. Respondent received both documents well in advance of the acts and omissions in question.
During the three-year period ending with his termination, Respondent attended 29 meetings involving his fire department consultation business during normal City business hours, although he attended only one such meeting after October 1993. Respondent took leave from the City only seven times. On one occasion, Respondent was away from the office, without leave, at one of his client fire departments when a hazardous waste spill occurred in the City yacht basin. However, he was quickly located and returned to the scene.
On eight occasions that Respondent travelled on City business, he submitted expense vouchers for personal telephone calls that were not related to his City employment or permitted by City written policy that allows a daily $4 telephone call home while away on City business. The total of such disallowed expenses amounts to about $100.
Respondent has always received satisfactory employee evaluations. Mr. Sallee explained that part of the reason he discharged Respondent was the repetitive pattern of the violations and Respondent's position of responsibility with the City. Respondent made almost no reimbursement to the City for his personal use of City property and abuse of leave time.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter and the parties. Section 120.57(1), Florida Statutes.
Ordinance 50-94, which took effect October 24, 1994, governs the relationship between Petitioner and its employees. Article 8.B gives certain employees the right to appeal their suspension or dismissal from employment. Article 8.C authorizes Petitioner to retain independent hearing officers to conduct appeal hearings. In this case, Petitioner retained a hearing officer of the Division of Administrative Hearings.
Article 8.E.5 provides:
The hearing shall be a de novo hearing. In presenting its case, each party shall have the right to present evidence relevant to the issues, to cross examine opposing witnesses, to impeach any witness regardless of which
party first called him to testify, and to rebut the evidence presented against it.
The order of presentation of evidence shall be as follows:
* * *
(2) The City, as the party with the initial burden of proof, shall present its evidence first . . ..
Article 8.E.7 states:
In rendering his or her decision, the hearing officer shall determine whether, based on the
evidence presented, the discipline ordered was for just cause, The evidentiary standard to be
applied by the hearing officer shall be substantial, competent evidence.
Article 8.E.8 requires the hearing officer to issue the final order within 10 days of the hearing.
Ordinance 50-94 imposes the burden of proof on Petitioner. The burden of proof, or risk of nonpersuasion, does not shift during a hearing. Thus, the reference to "initial burden of proof" means only the initial burden of going forward with the evidence.
The standard of proof is unclear in Ordinance 50-94. The hearing is described in the ordinance as a "de novo" hearing and an "appeal" hearing.
These means different things. The evidentiary standard is described as "substantial, competent evidence." This is an appellate standard of review, not an evidentiary standard. Typically, an appellate court reviews an evidentiary record to determine if "competent and substantial evidence . . . support[s the] charges by a preponderance of the evidence." See, e.g., Dileo v. School Board of Dade County, 569 So. 2d 883, 884 (Fla. 3d DCA 1990).
In nearly all civil and administrative proceedings, the evidentiary standard is "preponderance of the evidence," which is used in most civil and administrative proceedings, or "clear and convincing evidence," which is used in certain civil and administrative proceedings. In cases involving the termination of teachers' employment contracts, the standard of proof is the less demanding standard of a "preponderance of the evidence." Dileo v. School Board of Dade County, 569 So. 2d 883, 884 (Fla. 3d DCA 1990).
It is impossible to apply the "competent, substantial evidence" standard unless the subject hearing is appellate in nature. If so, the subject of the appeal is either the Predisciplinary Conference or Review by City Manager. These prehearing processes are described in Article 7.D.3 and 4, respectively.
The decisions resulting from the Predisciplinary Conference and Review by City Manager are not necessarily based on "competent, substantial evidence." Article 7.D.3.c states that the Predisciplinary Conference "shall be informal and shall not be in the nature of an evidentiary hearing." Although the employee may bring an attorney, the "formal rules of evidence shall not apply." Article 7.D.3.d applies the same provisions to the Review by City Manager.
"Competent, substantial evidence" is
such evidence as will establish a substantial basis of fact from which the fact at issue can be reasonably inferred. . . . [T]he evidence relied upon to sustain the ultimate finding should be sufficiently relevant and material that a reasonable mind would accept it as adequate to support the conclusion reached.
To this extent the "substantial" evidence should also be "competent."
De Groot v. Sheffield, 95 So. 2d 912 (Fla 1957).
The appellate nature of the "competent, substantial evidence" standard was recently recognized in Lee County v. Sunbelt Equities II, 619 So. 2d 996, 1003 (Fla. 2d DCA 1993) (per curiam). Citing De Groot, the court noted that the issue of "competent, substantial evidence"
involves purely a legal question: whether the record contains the necessary quantum of evidence.
The circuit court [sitting in its appellate capacity] is not permitted to go farther and reweigh the evidence (e.g., where there may be conflicts in
the evidence), or to substitute its judgement about what should be done for that of the administrative agency.
Petitioner does not explain how a nonevidentiary hearing can produce competent evidence. The ordinance describes a process that is devoid of the usual means by which competent evidence is produced, such as taking evidence under oath or allowing cross examination. The informal process is not designed to produce an evidentiary record that could later be reviewed by the "competent, substantial evidence" standard.
Nor does Petitioner explain why, if the subject hearing "involves purely a legal issue," the ordinance anticipates the presentation of evidence and addresses such issues as the burden of proof or rebuttal evidence, as noted above, or, as mentioned elsewhere in the ordinance, the requirement of testimony under oath. Agencies or courts applying the "competent, substantial evidence" standard do not take additional evidence, but rather perform appellate-like review of an existing factual record.
For these reasons, the subject hearing is de novo and the applicable evidentiary standard is a "preponderance of the evidence," not "competent, substantial evidence."
Article 6.E states that Petitioner may dismiss an employee for "just cause," but must first comply with the procedures set forth in Article 7 in conducting a Predisciplinary Conference and Review by City Manager. Petitioner has complied with the procedural requirements of Ordinance 50-94.
Article 7.A provides that "[d]isciplinary actions, in increasing order of severity, shall consist of oral reprimand, written reprimand, suspension without pay, demotion, and dismissal." Article 7.B states:
Generally, the City shall follow a policy of progressive discipline by which less severe forms of discipline are imposed prior to resorting to the imposition of more severe sanctions for the same or similar conduct by the employee. The City, however, reserves the right to impose even the most severe discipline
as an initial measure when circumstances warrant.
Article 7 states the grounds for discipline as, in part:
* * *
13. Theft, conversion of, or willful or
careless waste of, City supplies, property, or equipment.
* * *
Unauthorized use of City personnel services, supplies, property, facilities, or equipment.
Engaging in personal or business activities unrelated to City employment during work hours.
* * *
24. Violation of Department work rules or operating procedures.
* * *
Utilization of official position for unauthorized personal gain.
Actions or conduct detrimental to the interests of the City.
Any other properly substantiated cause which adversely affects the City.
Section 2.10 of former Ordinance 9-81 stated that "conduct unbecoming an employee, supervisor, or Department Head may result in dismissal." Section
28 of former Ordinance 9-81 provided for dismissal "for cause." Section 30 of former Ordinance 9-81 also called for progressive discipline, evidently without exception.
Petitioner has proved that Respondent violated various provisions of Ordinance 50-94 in the misuse of City property. It is unnecessary to consider if he also violated other provisions of applicable law.
Petitioner argues that Ordinance 50-94 leaves no discretion in the hearing officer as to the discipline. Petitioner argues, in other words, that the discipline selected by the City must be enforced if the employee is found to have violated any disciplinary provisions of the ordinance. A close reading of the ordinance reveals the flaw of this argument.
Article 7.3 requires that the employee first undergo a Predisciplinary Conference. If the Department Head conducting the conference decides to impose discipline, the employee has the right, under Article 7.4, to demand review by the City Manager, who, under Article 7.4.c, must "determine whether the disciplinary action to be imposed is based on good and sufficient cause." Article 7.4.g and h authorizes the City Manager to alter the discipline, as well as to reverse the Department Head's decision.
In similar language, Article 8.E.7 requires the hearing officer to "determine whether, based on the evidence presented, the discipline ordered was for just cause." This is the same responsibility as that assigned to the City Manager and thus requires the hearing officer to determine whether a preponderance of the evidence supports the proposed discipline, pursuant to the relevant provisions of Article 7.
The issue is closer as to the appropriate discipline. Petitioner did not implement progressive discipline, but the ordinance allows Petitioner to bypass progressive discipline if circumstances warrant. The circumstances are that Respondent was a high-level managerial employee of the City whose many violations of City policy and law extended over a long period of time and continued even after the admonition given him by the new City Manager not to do
outside business on City time. The function of progressive discipline is to train, but the need for training a high-level manager is slight or nonexistent.
Some of the out-of-pocket expenses wrongfully borne by the City are fairly small, which militates in favor of a lesser discipline. However, the cellular phone costs are significant, as is the value of the lost time of Respondent.
On balance, Petitioner has proved by a preponderance of the evidence that the most suitable discipline is discharge.
ORDERED that Respondent is discharged from City employment as of January 24, 1995.
ENTERED on April 21, 1995, in Tallahassee, Florida.
ROBERT E. MEALE
Filed with the Clerk of the Division of Administrative Hearings on April 21, 1995.
Marilyn W. Miller Assistant City Attorney City of Cape Coral
P.O. Box 150027
Peter W. Zinober Zinober & McCrea, P.A.
Mark F. Kelly
Kelly & McKee, P.A.
A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO ORDINANCE 50-94, ARTICLE 8.E.9 BY FILING A PETITION FOR A WRIT OF CERTIORARI.
