FILED

February 1, 1999

Cecil Crowson, Jr.

Appellate C ourt

Clerk

 IN THE COURT OF APPEALS

AT KNOXVILLE

CURTIS G. MAYES, ) KNOX CHANCERY

 ) C. A. NO. 03A01-9801-CH-00032

 Plaintiff-Appellant )

 )

 )

 )

 )

 )

vs. ) HON. FREDERICK D. McDONALD

 ) CHANCELLOR

 )

 )

 )

 )

 )

MARGARET C. CULPEPPER, ) REVERSED AND REMANDED

Commissioner of the Tennessee )

Department of Employment )

Security )

 )

 and )

 )

WAL-MART STORES, INC., )

 )

 Defendants-Appellees )

LEE ANN SWARM, Knoxville Legal Aid Society, Inc., for Appellant.

JOHN KNOX WALKUP, Attorney General and Reporter, and DOUGLAS EARL

DIAMOND, Assistant Attorney General, for the appellee, Commissioner

of the Tennessee Department of Employment Security.

FREDERICK W. HODGE, Nashville, for appellee, Wal-Mart Stores, Inc.
2

O P I N I O N

McMurray, J.

This is an appeal from the denial of unemployment compensation

benefits. Through the entire procedure, including an appeal to the

Chan cery Court for Knox County, the appellant has been den i e d

unemployment compensation benefits because he had been gui lty of

misconduct arising out of the scope and course of him employment

and T.C.A. § 50-7-303(a)(2) bars him from recovery of unemployment

compensation benefits. We reverse the judgment of the Chan cer y

Court and remand this case to the trial court for entry of an order

awarding unemployment benefits as provided by law.

O n September 1, 1995, the appellant bega n his employment at

Wal-Mart. Before his employment at Wal-Mart, the appellant had

been arrested and charged with assault, vandalism and wire tapping.

A t the time of his initial employment with Wal-Mart the charges

were still pending. On his application for employment, the

appellant was asked whether he had been convic ted o f a felony or

any type of theft or fraud. He responded truthfully that he had

not because at that time, as noted, the charges were still pending.
3

The employment application contained no question regarding arrests.

Therefore, the appellant did not falsify his employment ap plic a -

tion.

When he first went to work at Wal-Mart, he worked as a

stockman. He was later transferred to courtesy patrol in the

parking lot. On July 15, 1996, the appellant was placed on a

judicial diversion for the pending charges. The appellant did not

advise Wal-Mart of the judicial diversion. Wal-Mart learned of the

judicial diversion through other sources and termi nat ed the

appellant's employment. Wal-Mart concedes that it h as no policy

that wou ld hav e required the appellant to report the judicial

diversion to Wal-Mart. The closest thing to a policy regarding the

subject matter is found in the testimony of Mr. Lewis Blockton, a

supervisor at Wal-Mart. He testified as follows:

MR. BLOCKTON: Oh, violation of policy as far as an

arrested associate. He was - he wasn't arrest ed, but

acco rdi n g to our policy, if once they plead guilty to

charges or - or pleads no contest or is found guilty of -

o f any charges and our - our Wal-Mart is saying that,

hey, if the guy is out there guarding other people's safe

being and property, and he just pleded (sic) guilty to

these charges - you know - how can he stop someone else?

T.C.A. § 50-7-303(a)(2) provides as follows:

(a) Disqualifying Events. A claimant shall be disqualified for benefits:
4

(2) If the commissioner finds that a claimant has

been discharged from such claimant's most recent

work for misconduct connected with such claimant's

work, such disqualification shall be for the duration of the ensuing p eriod of unemployment and

until such claimant has secured subsequent employment covered by an unemployment compensation law of

this state, or another state, or of the United

States, and was paid wa ges thereby ten (10) times

such claimant's weekly benefit amount;

S i nce the incidents that resulted in the termination o f th e

appellant occurred before his employment with Wal-Mart; he did not

falsify his employment application nor violate any company policy,

w e are of the opinion that the arrest and subsequent judicial

diversion are not connected wi th the appellant's work within the

meaning of the above quoted statute.

While the circumstances may be such as to make the appellant

unsuitable for the particular work that he was doing for Wal-Mart,

i.e., security, they do not constitute grounds for denia l o f

unemployment benefits. In Cherry v. Suburban Manufacturing

Compa n y , 745 S.W.2d 273, our Supreme Court made the followin g

observation:

I t has long been settled in this state, however,

that a justifiabl e disc harge is not, in and of itself,

"misconduct connected with his work" so as to disqualify

a n employee under t he statute. The quoted phrase is a

very general one, and each cas e m ust be determined in

light of all of the facts and circumstances attendant

upon the employee's termination. At a minimum, however,
5

the cases are clear that the burden of proving a disqualification is on the employer; and in order to establish

a disqualification there must be shown a material breach

o f some duty which the employee owes to the employer. See

generally, Weaver v. Wallace , 565 S.W.2d 867, 870 (Tenn.

1978), where the Court said:

 "Unl ess the employee's wrongdoing violates a

duty owed to the employer, it cannot amount to that

'misconduct connected with his work ' which serves

t o disqualify him to receive unemployment insurance

benefits, although it may fully justi fy th e employer in discharging him."

I d . at page 275.

W e find tha t there was no misconduct on the part of the

appellant (as that term is used in T.C.A. § 50-7-303(a)(2)) which

would disqualify him from receiving unemployment compensation

benefits. Accordingly, we reverse the judgment of the trial court

and remand this case for entry of an order awarding unemployment

compensation benefits in accordance with prevailing law. Costs are

taxed to the appellees.

___________________________________

 Don T. McMurray, Judge

CONCUR:

___________________________________

Houston M. Goddard, Presiding Judge

____________________________________

Charles D. Susano, Jr., Judge
 IN THE COURT OF APPEALS

AT KNOXVILLE

CURTIS G. MAYES, ) KNOX CHANCERY

 ) C. A. NO. 03A01-9801-CH-00032

 Plaintiff-Appellant )

 )

 )

 )

vs. ) HON. FREDERICK D. McDONALD

 ) CHANCELLOR

 )

 )

MARGARET C. CULPEPPER, ) REVERSED AND REMANDED

Commissioner of the Tennessee )

Department of Employment )

Security )

 )

 and )

 )

WAL-MART STORES, INC., )

 )

 Defendants-Appellees )

JUDGMENT

This appeal came on to be heard upon the record from the

Chancery Court of Knox County, briefs and argument of counsel.

Upon consideration thereof, this Court is of the opinion that there

was reversible error in the trial court.

W e reverse the judgment of the trial court and remand this

case for entry of an order awarding unemployment compensation

benefits in accordance with prevailing law. Costs are taxed to the

appellees.

 PER CURIAM