SC Administrative Law Court Decisions

The South Carolina Department of Labor, Licensing and Regulation, Board of Architectural Examiners (Board) found Thomas R. King (King) in violation of several statutes and regulations governing the practice of architecture in South Carolina. In light of the violations, the Board imposed an indefinite suspension of King's license to practice architecture in South Carolina, required him to pursue additional education, required him to notify his clients of the suspension, and assessed costs against King of $6,463.05. ⁽¹⁾ King appeals the decision to the Administrative Law Judge Division (ALJD).

An appeal before the ALJD is governed by the review criteria of S.C. Code Ann. § 1-23-380(A)(6) (Supp. 2000). See S.C. Code Ann. § 1-23-380(B) (Supp. 2000) (where an ALJ is directed to conduct a review "in the same manner prescribed in [§ 1-23-380](A)."). Section 1-23-380(A)(6) establishes the following criteria:

The court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings. The court may reverse or modify the decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions or decisions are:

(a) in violation of constitutional or statutory provisions;

(b) in excess of the statutory authority of the agency;

(c) made upon unlawful procedure;

(d) affected by other error of law;

(e) clearly erroneous in view of the reliable, probative and substantial evidence on the whole record; or

(f) arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.

Here, King argues a reversal of the Board's decision is required under (c), (d), (e), and (f). In the alternative, King argues this matter should be remanded to the Board since the Board's decision fails to make specific findings of fact and fails to explain its rationale in sufficient detail to afford judicial review.

Since I find that the Board's decision fails to make specific findings of fact and fails to explain its rationale, I do not reach the merits. Rather, the Board's order is vacated, and this matter is remanded for further consideration consistent with the explanation below.

1. Applicable Standard

The standard an administrative body must satisfy in issuing its decision is now well established.

"An administrative body must make findings which are sufficiently detailed to enable this Court to determine whether the findings are supported by the evidence and whether the law has been applied properly to those findings." Porter v. S.C. Public Serv. Comm'n, 333 S.C. 12, 507 S.E.2d 328 (1998). This Court will not accept an administrative agency's decision at face value without requiring the agency to explain its reasoning. Id. As with all agency orders, when the PSC issues their determination about the reasonableness of intercompany dealings, their findings of fact must be sufficiently detailed to enable the reviewing court to determine whether the findings are supported by the evidence in the record and whether the law has been properly applied. See Able Communications, Inc. v. S.C. Public Serv. Comm'n, 290 S.C. 409, 411, 351 S.E.2d 151, 152 (1986). Where material facts are in dispute, the administrative body must make specific, express findings of fact. Id. In the current case, the PSC failed to meet the required standard.

Kiawah Property Owners Group, v. Public Service Commission of South Carolina and Kiawah Island Utility, Inc., 338 S.C. 92, 525 S.E.2d 863 (1999).

2. Elements of an Order Meeting the Applicable Standard

Under this standard, an administrative decision is unacceptable if it states the outcome (suspension, etc.) without explaining the reasoning that leads to the outcome. An adjudicative body fails to explain its reasoning when the decision does not spell out how the conclusions reached were arrived at from the facts determined. Ruggero J. Aldisert, The Judicial Process 626-57 (1976). Thus, an adequate order will have at least three elements. The elements (not necessarily listed in the order in which they will appear in the decision) are a determination of the facts, a determination of the conclusions drawn from those facts, and third, (and most importantly) an explanation of how and why the determined facts led to the conclusions reached.

a. Board's Failure To Issue An Adequate Order

With no attempt to be exhaustive, the following explains only one example of how the order is deficient in its fact finding and in its statement of rationale supporting its conclusions. ⁽²⁾

The fact finding element of an order requires that the trial adjudicator be mindful of the difference between material facts that are disputed and material facts that are undisputed. If a material fact is disputed, the Board must decide the factual dispute in a direct and unambiguous manner. Able Communications, Inc. v. S.C. Public Serv. Comm'n, 290 S.C. 409, 411, 351 S.E.2d 151, 152 (1986). Further, for material, disputed facts, the agency must present some rationale as to how it decided the disputed fact. Porter v. S.C. Public Serv. Comm'n, 333 S.C. 12, 507 S.E.2d 328 (1998). In the case now on appeal, the Board in a highly critical area failed to decide a factual dispute in a direct and unambiguous manner and failed to give a rationale for the decision made as to that fact finding.

For example, King was found to have violated §§ 40-3-10(2) (Supp. 1997), 40-3-20 (6) (Supp. 1998), 40-22-30 (Supp. 1997 and 1998), and 40-22-460 (B)(2) (Supp. 1997 and 1998). To varying degrees, each violation stems from an allegation that King performed engineering functions beyond those permitted to be performed by an architect. King asserts he did not perform engineering services beyond that allowed by an architect since he obtained the services of an engineer in presenting his work. Indeed, the Order specifically finds that King's drawings contain an engineer's seal. ⁽³⁾ However, a critical factual dispute is whether the engineer's seal was improperly appropriated from an engineer.

As to this critical issue, the Board heard testimony from King's secretary who stated that she placed the engineer's seal on the drawings and that she did so only after being directed to do so by the engineer. However, the Board heard diametrically opposed testimony from the engineer. The engineer testified that King had not engaged the engineer's services and that the engineer had not given anyone permission to use his seal.

Thus, the Board had a clear difference of viewpoints from two critical witnesses and yet the Board failed to definitively decide this factual dispute. Instead, the Board chose merely to restate testimony. In Findings of Fact 7, the Board restates what the engineer "testified" but the Board does not make a definitive factual finding on whether King improperly appropriated the engineer's seal. ⁽⁴⁾

Since the Board found a violation but states no rationale for its conclusion, the appellate body is left to speculate on the basis for that conclusion. For example, at least one speculative inference is that the Board did not believe the testimony of the secretary but did believe the engineer and thus concluded that King had improperly appropriated the seal of an engineer. However, an equally plausible inference exists from which the Board (rightly or wrongly) could have concluded a violation occurred. The Board could have believed that the secretary thought she had the engineer's permission when she did not. From such a view the Board could have then concluded that King wrongly and improperly chose to rely upon a secretary's assurance of an engineer's approval when submitting drawings having an engineer's seal. The inference chosen by the Board makes a significant difference in deciding what statute, if any, was violated. Thus, the facts are not plainly decided and a rationale is not clearly articulated so as to allow the reviewing body to decide if the Board properly applied the law.

b. Organization of the Order

Given the duty to render an adequate order, how the Board organizes the three elements of an adequate order is left largely to the Board's discretion. In exercising that discretion, the Board should not read S.C. Code Ann. § 1-23-350 (Supp. 2000) as limiting the order's content or style.

For example, as to content, § 1-23-350 merely explains that the findings of fact and conclusions of law must be separately stated. Imposing a duty to separately state parts of the order does not dictate that the order must consist of only those two parts. On the contrary, nothing in the statute prohibits the order from including other elements. Thus, the statute does not limit the order to a mere statement of findings of fact and conclusions of law.

As to style, the statute does not impose a required method for separately stating the facts from the conclusions of law. Indeed, our Supreme Court has advised that no predetermined format is required and in particular has stated that findings of facts and conclusions of law need not be stated or enumerated under separate headings. Seabrook Island Property Owners Ass'n v. South Carolina Public Service Comm'n, 303 S.C. 493, 401 S.E.2d 672 (1991).

Thus, what is necessary is that the reviewing body clearly identify the factual findings, the conclusions of law, and the rationale used to reach those findings and conclusions. Here, the Board has not issued an order complying with the required standard.

I remand this matter to the Board without reaching the merits. See Kiawah Property Owners Group, v. Public Service Commission of South Carolina and Kiawah Island Utility, Inc., 338 S.C. 92, 525 S.E.2d 863, 865 (1999) (where reviewing, lower court judge was admonished not to address merits when the administrative agency below failed to make the required findings and failed to give the required rationale; rather, a remand was appropriate). On remand, in addition to considering the transcript and evidence already presented, the Board shall determine whether a supplemental hearing is required to decide the material, factually-disputed issues. Thereafter, and upon consideration of the entire record made, the Board shall issue its decision. Such decision may dismiss the charges, find the charges proven, or make any other decision within the authority of the Board to make. All that is required is that an adequate order result. ⁽⁵⁾

Accordingly, the Board's order is vacated, and this matter is remanded to the Board who shall proceed in accordance with the dictates of this decision.

AND IT IS SO ORDERED.

____________________________

RAY N. STEVENS

Administrative Law Judge

Dated: August 21, 2001

Columbia, South Carolina

1. The Board's Order provided that King could apply to have his license reinstated after one year from the date of the Board's Order of January 9, 2001.

2. No attempt is made to analyze all of the findings of the Board's order or to decide if each finding or conclusion meets the required elements of an adequate order. Rather, the order as a whole fails to meet the standard set forth in Porter, and, since a remand is ordered, the Board should re-examine all of its findings and conclusions in light of the example and explanation presented here.

3. King admits that his first set of church drawings did not have an engineer's seal. Further, he admitted the error long before charges were brought since the error was called to his attention early on in the project. King argues he acknowledged his mistake and asserts he complied completely with the requirement to obtain an engineer's approval when he submitted the second set of drawings. Thus, King argued that no violation occurred since he corrected the problem.

4. In addition, as explained in other parts of this decision, once a finding is made on a material fact dispute, the order must give some rationale as to how the fact dispute was resolved.

5. Since this matter is being remanded, I note for the Board's consideration that King was charged on October 26, 1999 and, as amended, on December 22, 1999 with violating three provisions of Regs. 11-15. However, effective May 28, 1999, Regs. 11-15 was repealed and Regs. 11-12 (a regulation almost identical to Regs. 11-15) was promulgated,. See State Register Volume 23, Issue No. 5. On remand, should the Board decide the provisions of Regs. 11-15 were violated, the Board may wish to express its rationale for finding a violation of a repealed regulation.