Case Title: FRJ CORP. v. MASON

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 2000-04-12T00:00:00Z

Document:
FRJ CORP. v. MASON2000 WY 904 P.3d 896Case Number: 99-50Decided: 04/12/2000Supreme Court of Wyoming
 
FRJ CORPORATION, License 
#98 02480 FRJ CORPORATION, License #98 02711 JAMES P. FEDERER, License #99 04575 
JAMES P. FEDERER, License #98 03150, Appellants (Petitioners), v.DICK MASON, 
Chief Building Inspector, Appellee (Respondent).

W.R.A.P. 12.09(b) 
Certification from the District Court of Laramie County: The Honorable Nicholas 
G. Kalokathis, Judge.

Representing 
Appellants: Walter Urbigkit of 
Frontier Law Center, Cheyenne, WY.Representing Appellee: Mary B. 
Guthrie, City Attorney, and Bill G. Hibbler, Special Assistant City Attorney, 
Cheyenne, WY.

Before 
LEHMAN, C.J., and THOMAS, GOLDEN, and HILL, JJ., and TAYLOR, J., 
Ret.

LEHMAN, Chief 
Justice.

[¶1] After a 
contested case hearing, the City of Cheyenne Contractor Licensing Board (Board) 
disciplined the appellants, FRJ Corporation and James Federer, for failure to 
obtain the required permits and failure to pay the required fees in connection 
with plumbing work performed within the city limits of Cheyenne. Appellants 
sought review in the district court, and the matter was certified to this court 
under W.R.A.P. 12.09. We affirm the Board's decision to suspend the appellants' 
licenses for ninety days, which decision was rendered as a result of a contested 
case hearing in which the Board used the services of a hearing 
examiner.

ISSUES

[¶2] Appellants 
state this issue:

Does the license 
suspension/revocation hearing, conducted on the basis that a necessary building 
permit had not been obtained from the City of Cheyenne (City Development 
Department), and the adverse decision then made by the Contractor Licensing 
Board, that the licensee failed to obtain a City utility tap permit for 
connection with the City sewer and water system to be issued by the Cheyenne 
Board of Public Utilities constitute divergence between the charge and the 
decision to render invalid the "guilt" finding and consequent license 
suspension/revocation when in fact the utility tap permits for the house had 
been obtained?

In more detail the same 
issue would be whether the finding of the Contractor Licensing Board in specific 
Finding Eight and Conclusion Determination Five was arbitrary, capricious, an 
abuse of discretion or otherwise not in accordance with the law, and unsupported 
by substantial evidence, when the hearing was litigated on the basis that the 
contractor wrongfully neglected to obtain a second building permit when a 
plumbing change was made during construction compared to the decision which is 
challenged on appeal as erroneous wherein the Board found that the necessary tap 
permit for connection to the Bureau of Public Utilities managed City sewer and 
water systems had not been obtained.

[¶3] The 
appellee in this matter is Dick Mason, Chief Building Inspector (Inspector) for 
the City of Cheyenne. He submits three issues for our 
consideration:

I. Whether the Board's 
decision suspending the licenses held by the appellants for ninety days is 
supported by substantial evidence?

II. Whether the Board's 
decision suspending the licenses held by the appellants for ninety days is 
arbitrary, capricious, an abuse of discretion or contrary to 
law?

III. Did the hearing 
examiner err by refusing to allow the City to present rebuttal 
testimony?

FACTS

[¶4] In June of 
1997, appellants, James Federer (Federer), a master plumber with sewer and water 
main qualified supervisor licenses, and FRJ Corporation (FRJ), a Wyoming 
corporation, applied with and paid fees to the Board of Public Utilities (BOPU), 
in connection with the construction of townhouses located at 5701 and 5703 
Atlantic Drive in Cheyenne. Federer and FRJ hold plumbing and pipe fitting and 
sewer and water main contractor licenses.

[¶5] During the 
same time period, another building was erected behind the 5703 Atlantic property 
(Atlantic property) at 700 Gettysburg Drive (Gettysburg property). The 
Gettysburg property lies outside Cheyenne's city limits. The city plumbing 
inspector testified that upon his initial inspection of the Atlantic property, 
he found the plumbing properly constructed. As is customary with all such 
inspections, the plumbing inspector presumed the area would be backfilled 
immediately after his approval with no changes made.

[¶6] Meanwhile, 
a concerned neighbor, who had been watching the development, questioned the 
contractors about the nature of the Gettysburg property, especially given the 
fact that the building was equipped with windows and what appeared to be a 
bathroom. The contractors assured the neighbor that the building was being 
constructed as a storage facility. Unsatisfied with this answer, she called city 
officials and discovered there was no well permit for the Gettysburg property. 
In the beginning of February of 1998, the neighbor turned a spigot on the 
outside of the Gettysburg property and water came out. She again contacted city 
officials.

[¶7] As a result 
of the neighbor's multiple contacts with city building officials and reports of 
an unpermitted water source to the Gettysburg property, the plumbing inspector 
revisited the Atlantic property and discovered an open ditch outside the 
property which contained unauthorized plumbing and taps into the city water and 
sewer system. In addition to serving the Atlantic property, the lines served the 
Gettysburg property. Because the appellants failed to obtain the required 
additional permits and pay fees for the Gettysburg property, the plumbing 
inspector concluded that the appellants had violated city building and plumbing 
regulations.

[¶8] BOPU and 
the City of Cheyenne Chief Building Inspector filed contractor complaints with 
the Board on March 2 and March 11, 1998, alleging the appellants failed to 
comply with the regulations. After several continuances, the Board held a 
contested case hearing on October 12, 1998, entering its Findings of Facts, 
Conclusions of Law and Order, on November 10, 1998. The Board determined that 
the appellants had violated various provisions of the code and regulations and 
were, therefore, subject to a ninety-day suspension of their 
licenses.

STANDARD OF 
REVIEW

[¶9] In 
reviewing cases certified under W.R.A.P. 12.09, this court applies the appellate 
standards which are applicable to a reviewing court of the first instance. 
Thomas v. Star Aggregates, Inc., 982 P.2d 714, 715 (Wyo. 1999). Rule 12.09(a) 
limits judicial review of administrative decisions to a determination of those 
matters which are specified in Wyo. Stat. Ann. § 16-3-114(c)(ii)(E) (Lexis 
1999), which provides in pertinent part:

(c) To the extent 
necessary to make a decision and when presented, the reviewing court shall 
decide all relevant questions of law, interpret constitutional and statutory 
provisions, and determine the meaning or applicability of the terms of an agency 
action. In making the following determinations, the court shall review the whole 
record or those parts of it cited by a party and due account shall be taken of 
the rule of prejudicial error. The reviewing court shall:

. . 
.

(ii) Hold unlawful and 
set aside agency action, findings and conclusions found to 
be:

(A) Arbitrary, 
capricious, an abuse of discretion, or otherwise not in accordance with 
law;

. . 
.

(E) Unsupported by 
substantial evidence in a case reviewed on the record of an agency hearing 
provided by statute.

[¶10] 
Substantial evidence is "relevant evidence that a reasonable mind can accept as 
adequate to support an agency's conclusion." Whiteman v. Workers' Safety & 
Compensation Div., 984 P.2d 1079, 1081 (Wyo. 1999) (quoting Casper Oil Co. v. 
Evenson, 888 P.2d 221, 224 (Wyo. 1995)). The agency, as the trier of fact, must 
weigh the evidence and determine the credibility of the witnesses. Matter of 
Worker's Compensation Claim of Nissen, 983 P.2d 722, 724 (Wyo. 1999). We will 
not upset such decisions on appeal if they are supported by substantial 
evidence. Agency action is arbitrary and capricious if it is "willful and 
unreasonable, without consideration and in disregard of the facts and 
circumstances." Matter of Corman, 909 P.2d 966, 971 (Wyo. 
1996).

DISCUSSION

[¶11] In the 
Conclusions of Law, the Board found:

2. Section 3.9.1 of the 
Contractor's Licensing Board's Rules and Regulations (Rules) provides in 
relevant part that, generally, Licensees are responsible for work requiring a 
permit under the provisions of these regulations and City Code. Licensees 
must:

a. Be responsible for all 
work covered by the permit for work done directly by the Licensee, Licensee's 
employees, or subcontractors.

c. Insure that all 
required permits are obtained.

g. Build in compliance 
with applicable codes, regulations and manufacturer's 
specifications.

k. Pay any fee assessed 
under the authority of these regulations and the Uniform Technical 
Codes.

3. Section 4.1.3 of the 
Rules provides that the Board may suspend or revoke a license when the Licensee 
"violates any provisions of these regulations."1

4. Section 5.1 of the 
Rules provides that "[n]o person may perform any work described in these 
regulations, the building or related codes or in the City Code, without first 
securing a permit from the Building Official."2

[¶12] After 
hearing all the evidence, the Board determined that the appellants violated 
provisions 3.9.1 and 5.1 by knowingly and willfully tapping into the City's 
potable water and sewer system without authorization or 
permit.

[¶13] We 
conclude, after reviewing the entire record, that the Board's findings that the 
appellants violated the regulations are supported by substantial evidence. 
First, the plumbing inspector testified that one of the appellants' 
subcontractors told him that he installed the illegal connections or taps, under 
the appellants' direction, after that inspector had inspected the Atlantic 
property. In addition to the plumbing inspector, the Chief Building Inspector 
and Federer agreed that neither a BOPU tap nor a city permit was ever applied 
for or issued. Testimony revealed that additional plumbing connections required 
additional permits and payment of additional fees. The appellants failed to do 
this, claiming they did not believe such action was required. However, the Board 
concluded Federer's argument, that he did not know a permit was necessary, 
lacked credibility. As the reviewing court, it is not our duty to reassess the 
credibility of a witness as long as the decision is supported by relevant 
evidence. Morgan v. Olsten Temporary Services, 975 P.2d 12, 15 (Wyo. 
1999).

[¶14] Second, 
the decision to suspend the appellants' licenses was not arbitrary, capricious, 
an abuse of discretion, or contrary to law. This argument is based on the 
premise that the Board's decision was not confined to issues and facts in the 
notice of hearing or evidence presented at the hearing. As we have previously 
recognized, only issues and violations identified within a proper notice and 
complaint may be pursued at a hearing and considered in issuance of an agency 
decision. Slagle v. State Bd. of Nursing, 954 P.2d 979, 982-83 (Wyo. 1998). The 
Notice of Hearing in the case before us specified:

A complaint has been 
filed against James P. Federer and FRJ Corporation, by Dick Mason, Chief 
Building Inspector. The complaint alleges that Mr. Federer illegally tapped into 
the sewer and water lines designed to serve the property at 5703 
Atlantic.

[¶15] The 
illegal tap was intended to serve Mr. Federer's property at 700 Gettysburg, 
which is in the County. These illegal taps were made subsequent to the 
underground sewer and water inspection conducted by City Inspector Rick Brittain 
and prior to the ditch being backfilled.

[¶16] The Board 
provided the appellants with adequate notice of the specific issues and 
violations with which they had been charged, and the Board did not abuse its 
discretion when it adjudicated those violations.

CONCLUSION

[¶17] There was 
substantial evidence of the appellants' failure to pay the required fees and 
obtain the required permits. Therefore, we affirm the Board's decision to 
suspend the appellants' licenses for ninety days.

Footnotes

1 4.0 
Suspension or revocation of license.

4.1. 
Authority. The Building Official or Board may suspend or revoke a license when 
the Licensee commits one or more of the following acts or 
omissions:

. . 
.

4.1.3 
Violates any provisions of these regulations.

2 5.0 
Permits.

5.1. Permit 
required. No person may perform any work described in these regulations, the 
building or related codes or in the City Code, without first securing a permit 
from the Building Official.