This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2014).

STATE OF MINNESOTA

IN COURT OF APPEALS

A15-0967

In the Matter of the Administrative Penalty Order of Fay’s Homestyle Catering

Filed April 25, 2016

Affirmed

Connolly, Judge

OAH Docket No. 82-0900-31453

Diana Longrie, Maplewood, Minnesota (for relator)

Lori Swanson, Attorney General, Cody M. Zustiak, Assistant Attorney General, St. Paul, 

Minnesota (for respondent)

Considered and decided by Stauber, Presiding Judge; Connolly, Judge; and Reilly, 

Judge. 

U N P U B L I S H E D O P I N I O N

CONNOLLY, Judge

Relator challenges a $10,000 administrative penalty imposed by the commissioner

of the Minnesota Department of Health (the MDH) based on relator’s failure to obtain a 

license to provide catering services, arguing that the penalty amount is arbitrary and 

capricious. We affirm.
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FACTS

On May 5, 2009, the MDH foodborne illness hotline received a complaint of 

gastrointestinal illness from an individual who attended an event at which relator, Fay Scott 

d/b/a Fay’s Homestyle Catering, had prepared and served the food. On May 7, 2009 the 

City of Maplewood’s health officer sent relator a letter informing her that (1) she was 

running a catering operation out of her home in violation of the MDH’s food code and the 

City’s ordinances; (2) a catering operation requires a food-establishment license issued by 

the health authority; and (3) she is “ordered to immediately discontinue all food service 

and/or catering activities within [her] home.” Immediately after receiving the letter, relator 

discontinued preparing food for her catering business in her home. 

On September 27, 2013, relator prepared and provided food service to a private 

homecoming picnic for faculty, staff, and alumni of the College of Education and Human 

Development at the University of Minnesota. Relator prepared the food in the kitchen at 

the Progressive Baptist Church. The MDH became aware of health issues associated with 

preparation of the food on October 1, 2013, after receiving reports of foodborne illness 

stemming from the meal served by relator. On October 3, 2013, the MDH representatives 

inspected the church where the food was prepared and interviewed relator and identified 

her as the caterer for the picnic. During the interview, relator’s description of the timing 

of her cooking, “food-flow,” and food handling was imprecise and inconsistent. The MDH 

determined that it had not previously inspected relator and that she had not sought licensure 

from either the MDH or the Minnesota Department of Agriculture since 2009. Relator 

stated that she had catered the same event at the University of Minnesota for the past several 
3

years, and that she catered food that was prepared at the Progressive Baptist Church for 

approximately 20 events per year, such as weddings and funerals. The MDH inspectors 

found that the church kitchen had inadequate equipment to meet the needs of the picnic. 

Relator admitted to the MDH staff that she operated without the proper licensure. The 

MDH sent relator its October 3 inspection reports, which informed relator that she violated 

the licensure requirement of Minn. Stat. § 157.16 (2014). It is undisputed on appeal that 

relator’s mishandling of the food caused the health issues on September 27, 2013.

As a result of the interview, the MDH contacted the Hennepin County Human 

Services and Public Health Department (the HCHSPHD) epidemiology unit, informing 

them of the reports. Further investigation by the HCHSPHD discovered that 22 attendees 

of the picnic met the definition of a “case.” A “case” is “anyone that has vomiting or three 

or more loose stools in a 24-hour period and also consumed the food from that event.” No 

patrons who reported illness visited a doctor and no stool samples were taken. Although 

the University of Minnesota informed relator of the illness complaints on September 28, 

2013, relator failed to notify the MDH of the illnesses as required by law. 

Relator had a food-manager certification effective May 29, 2013 through May 29, 

2016. Relator also has a “ServSafe Certification” but testimony at trial indicated that being 

ServSafe certified is not enough to satisfy the safety certificate requirement to operate a 

catering business. Relator testified that she was under the impression that the licensure of 

the church kitchen at Progressive Baptist was current at the time she prepared the food for 

the picnic and that she did not need a license to prepare and serve food off site. This was 
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not correct. Moreover, it is undisputed that relator did not apply for the necessary license

to do so until October 1, 2013, four days after the event at issue. 

Following the investigations by both the MDH and the HCHSPHD, on 

November 19, 2013, the MDH held an enforcement forum (the forum) to decide an 

appropriate enforcement action for relator’s violations of the food code. While not part of 

the Plan for the Use of Administrative Penalty and Cease and Desist Authority and Other 

Division-wide Enforcement Tools (the plan) adopted by the commissioner,

1

the forum 

occurs when the department 

pulls together persons who are involved in any particular 

potential enforcement case to discuss the specifics of the case, 

make a determination if enforcement action is appropriate and, 

if so, the type of action to be taken that [is] authorized by 

statute. If a penalty is involved, it also includes the calculation 

of the penalty. 

The forum documented its decisions on a summary worksheet and determined that the 

penalty should be nonforgivable because operating without a license is classified as a 

“serious” violation under the plan and because “a non-forgivable penalty was deemed 

necessary to deter future violations.” 

In determining the base penalty, the forum considers “the deviation from 

compliance and the potential for harm regarding the particular violation and then use[s] a 

matrix that is Appendix B of the [p]lan to locate the appropriate penalty range according 

 

1 The plan includes a penalty calculation worksheet and instructions, including a penalty 

calculation matrix, to guide MDH staff in calculating administrative penalties. Under the 

plan, the performance of work without a required license is included in a list of “serious” 

violations. 
5

to the matrix.” The matrix has a vertical axis titled “Potential for Harm” and a horizontal 

axis titled “Deviation from Compliance.” The forum determined that the potential for harm 

was severe because actual harm resulted when “at least 22 persons fell ill” and the deviation 

from compliance was severe because the operator failed to obtain a license to cater out of 

the church kitchen as required by statute. The matrix dictates that, in cases where the 

potential for harm and deviation from compliance were severe, a penalty of $5,000 to 

$10,000 is warranted. The forum determined the penalty should be at the highest possible 

range, a fine of $10,000 because “actual harm did occur when persons were made ill.” The 

forum also determined that the base penalty should be adjusted upward an additional 

$10,000 in a nonforgivable penalty because the forum found that the violation was willful 

because relator had been previously ordered not to provide catering out of her home and 

without a license, indicating that she had a past history of violations. However, the forum 

participants reduced the penalty back to $10,000, the maximum penalty the law allows. 

Based on the forum’s determination, the MDH issued an administrative protective order 

(APO) to relator on February 25, 2014 for the amount of $10,000. It is undisputed that this 

whole process was done without the issuance of a “ten-day letter” required by the plan. 

Relator appealed the APO to an administrative-law judge (ALJ) on March 24, 2014,

and the ALJ concluded that the amount of the penalty was unreasonable, considering the 

factors in Minn. Stat. § 144.991, subd. 1 (2014), and recommended the amount of the 

penalty be reduced to $2,500. Additionally, the ALJ based its determination on the MDH’s 

failure to provide the ten-day letter as required by the plan and found that the failure to 

provide a ten-day letter was a violation of the process that the MDH relies upon to ensure 
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that its determinations are consistent and not arbitrary. The ALJ also found that the 

relator’s actions were not a willful violation of the law. 

On May 18, 2015, the commissioner issued an order adopting the Findings of Fact, 

Conclusions of Law and Recommendation of the ALJ with certain exceptions. The 

commissioner disagreed with the ALJ’s recommendation to reduce the penalty to $2,500 

and decided that the assessment of a $10,000 nonforgivable penalty was reasonable and 

ordered the APO due and payable. 

D E C I S I O N

Relator asserts the commissioner’s assessment of a $10,000 nonforgivable penalty 

is unreasonable, arbitrary or capricious and requests this court modify the penalty as 

recommended by the ALJ. “Unless the [c]ommissioner’s decision is arbitrary and 

capricious and without substantial support in the record, we shall affirm. When reviewing 

questions of law, however, we are not bound by the agency’s decision, and we need not 

defer to the agency’s expertise.” Dozier v. Comm’r of Human Servs., 547 N.W.2d 393, 

395 (Minn. App. 1996) (citation omitted), review denied (Minn. July 10, 1996). “An 

administrative agency’s assessment of penalties or sanctions is an exercise of its 

discretionary power. A reviewing court, therefore, may not interfere with the penalties or 

sanctions imposed by an agency decision unless a clear abuse of discretion is shown by the 

party opposing the decision.” In re Lawful Gambling License of Henry Youth Hockey 

Ass’n, 511 N.W.2d 452, 456 (Minn. App. 1994) (citation omitted), aff’d as modified (Minn. 

Apr. 22, 1994) (unrelated issue modified); see also Proetz v. Minn. Bd. of Chiropractic 

Exam’rs, 382 N.W.2d 527, 532-33 (Minn. App. 1986) (“The assessment of sanctions by a 
7

professional board is discretionary. Absent an abuse of discretion, the Board’s decision 

will not be disturbed on appeal.” (citation omitted)), review denied (Minn. May 16, 1986). 

“[An] agency’s conclusions are not arbitrary and capricious so long as a rational connection 

between the facts found and the choice made has been articulated.” In re Review of 2005 

Annual Automatic Adjustment of Charges for All Elec. & Gas Utils., 768 N.W.2d 112, 120 

(Minn. 2009) (quotations omitted).

Relator asserts that (1) she was “double penalized” by the forum because the forum 

found that a nonforgivable penalty was appropriate and that the deviation from compliance 

was severe, both because people actually became ill following the picnic; (2) the 

commissioner ignored its own rules by failing to issue a ten-day letter; and (3) the 

commissioner did not balance or consider any other statutory factors in the assessment of 

the penalty other than the violation was seen as “serious” and “willful.” We address each 

of these arguments in turn.

Double Penalty

Relator argues that she was “double” penalized for not having a license to cater the 

University of Minnesota picnic because her violation was determined to be “serious” 

warranting a nonforgivable penalty, and “serious” in regard to deviation from the 

compliance portion of the matrix. Relator neither points to any cases nor provides any 

legal argument in support of this theory to show that the commissioner’s decision was 

arbitrary or capricious. We discern no reason why a penalty cannot be both “serious” for 

purposes of determining whether a penalty is forgivable or nonforgivable and “serious” for 

purposes of the deviation from compliance axis of the penalty matrix based on a failure to 
8

obtain a license. As clearly stated in the plan, “[s]erious violations include conduct 

showing disregard for requirements or standards, or violations that present an actual or 

potential danger to public health.” Because relator provides no legal support for the 

“double penalization” argument, we conclude that there is no basis for determining the 

commissioner’s decision was arbitrary and capricious on a “double penalization” ground.

Ten-day Letter

Relator next argues that the commissioner’s failure to comply with the procedural 

requirement of issuing the ten-day letter makes the commissioner’s decision arbitrary and 

capricious. The plan states:

Because of the seriousness and finality of a nonforgivable [APO], the department will provide written notice 

of the alleged violation(s) and an opportunity for response 

before issuing the non-forgivable order. The department will 

provide a letter, called a “ten-day letter,” to the regulated party 

which clearly identifies the violation(s) and explains the 

underlying findings. The letter contains a request that the 

regulated party provide, within ten calendar days, any 

information that might impact the commissioner’s 

determination of alleged violation(s). In addition, department 

staff may contact the regulated party by telephone to explain 

the violation(s) . . . . The regulated party’s response to the tenday letter will be considered before issuing a non-forgivable 

administrative penalty order.

No ten-day letter was sent by the MDH. Relator argues that “providing the ten-day letter 

in a [non-forgivable] penalty case is not only grounded in the concept of fairness, but the 

concept of due process as well.” Relator claims that the commissioner’s failure to provide 

relator with an opportunity to be heard, without explanation or reasoned judgment, renders 

the decision arbitrary and capricious. 
9

To prevail on appeal, an appellant must show both error and prejudice resulting from 

the error. Midway Ctr. Assocs. v. Midway Ctr. Inc., 306 Minn. 352, 356, 237 N.W.2d 76, 

78 (1975); see Bloom v. Hydrotherm, Inc., 499 N.W.2d 842, 845 (Minn. App. 1993) 

(stating that the appellant bears the burden of demonstrating that error is prejudicial), 

review denied (Minn. June 28, 1993). While the MDH erred in failing to send a ten-day 

letter, relator has failed to show prejudice resulting from the error. Relator had ample 

opportunities to be heard in this case, including after the University of Minnesota informed 

her of the complaints against her on September 28, 2013, when relator attempted to obtain 

a license on October 1, 2013, and when the MDH representatives visited her at the church 

kitchen where she prepared the food, all of which occurred before the commissioner issued 

the APO. Further, after the issuance of the APO relator was granted a request for an 

evidentiary hearing where she was represented by counsel, submitted evidence, had the 

opportunity to challenge the MDH staff and evidence and presented her own witnesses. 

Finally, as found by the commissioner, relator did not give any viable explanations or take 

responsibility for the incident that caused at least 22 individuals to become ill. Relator has 

not shown that the failure to provide the ten-day letter has caused prejudice and therefore,

we cannot grant reversal on that ground.

Failure to Consider Statutory Factors

Relator argues that the commissioner did not balance or consider any statutory 

factors in the assessment of the penalty other than that the violation was seen as “serious” 

and “willful.” Minn. Stat. § 144.991, subd. 1 states: 
10

(a) In determining the amount of a penalty under section 

144.99, subdivision 4, the commissioner may consider:

(1) the willfulness of the violation;

(2) the gravity of the violation, including damage 

to humans, animals, air, water, land, or other 

natural resources of the state;

(3) the history of past violations;

(4) the number of violations;

(5) the economic benefit gained by the person by 

allowing or committing the violation; and

(6) other factors as justice may require, if the 

commissioner specifically identifies the additional 

factors in the commissioner’s order.

(b) For a violation after an initial violation, the commissioner 

shall, in determining the amount of a penalty, consider the 

factors in paragraph (a) and the:

(1) similarity of the most recent previous 

violation and the violation to be penalized;

(2) time elapsed since the last violation;

(3) number of previous violations; and

(4) response of the person to the most recent 

previous violation identified.

Minn. Stat. §144.991, subd. 1. Relator does not dispute that the lack of a license was 

serious, but rather argues that her actions were not willful.

“In many instances, the courts have defined ‘willful’ as a disregard for governing 

statutes and an indifference to their requirements, or a careless disregard of statutory 

requirements . . . [which includes violations] done with careless disregard of legal 

requirements.” In re Henry Youth Hockey Ass’n, 511 N.W.2d at 456. Relator had a 

ServSafe certification and a food manager certification from the state. Relator’s claimed 

belief that the church’s kitchen was licensed was not considered by the commissioner 

because there is no such thing as a “licensed kitchen.” Additionally, the forum determined 

that the letter relator received in 2009 made it very clear that a license was required in order 
11

to engage in catering services. Relator testified that, as a certified food manager, she had 

knowledge of the food code. Minn. R. 4626.1755 (2014) (part of the food code) states “[a]

person shall not operate a food establishment without a valid license to operate issued by 

the regulatory authority.” By her own admission, relator knew that she should not operate 

a food establishment without a valid license. Additionally, even if relator did not know the 

specific rule, one who has been warned about operating without a license previously, even 

though the previous warning was specific to operating out of her home, is on notice to seek 

and procure the necessary food licenses if she wishes to run a catering business. 

Finally, relator’s testimony at the hearing regarding what she did after she found out 

that someone had been ill indicates that she knew she needed a personal catering license, 

prior to being issued the penalty: 

COUNSEL: If you could, please tell us what led up to . . . 

RELATOR: To get my license?

COUNSEL: . . . you getting this receipt. Yes.

RELATOR: Okay. I was in the plan of coming downtown 

anyway to get my license, try to get them. And so I had never 

talked back to [the University of Minnesota coordinator], 

didn’t talk back to [the University of Minnesota coordinator] 

at all. And so I said, well, I better try to get my license, you 

know. But I knew these license – If someone was sick, I know 

these license wasn’t going to help me, but it’d be a process for 

me to get them.

. . . . 

COUNSEL: Okay. And so when you were applying for this 

license, did you think that you were applying for yourself 

personally, or did you think you were applying for it for the 

Progressive Baptist Church.

RELATOR: Personal.

Additionally, relator had obtained a temporary license on at least one previous occasion 

when relator catered for the City of St. Paul. This indicates that she was aware that, on 
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certain occasions when she was running a catering business, that a temporary license was 

required.

Given the substantial facts in the record, the commissioner did not act arbitrarily or 

capriciously in finding that relator’s violation was both serious and willful.

Because all the commissioner’s decisions were supported by a rational connection 

between the facts found and the choice made, we conclude that the commissioner did not 

abuse its discretion in enforcing the $10,000 APO. We are aware that this is a steep 

financial penalty. Nevertheless, we are obligated to follow the law.

Affirmed.