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IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

Opinion Number: __________

Filing Date: April 23, 2013 

Docket No. 32,149 (consolidated with 32,256)

ROBERT NARVAEZ,

Petitioner-Appellant,

v.

NEW MEXICO DEPARTMENT OF

WORKFORCE SOLUTIONS, and

SOUTHWEST TYRE LTD.,

Respondents-Appellees.

APPEAL FROM THE DISTRICT COURT OF GRANT COUNTY

Henry R. Quintero, District Judge

New Mexico Legal Aid

Alicia Clark

Albuquerque, NM

for Appellant

New Mexico Department of Workforce Solutions

Office of General Counsel

Marshall J. Ray

Rudolph P. Arnold

Albuquerque, NM

for Appellees

OPINION

WECHSLER, Judge.

{1} The Department of Workforce Solutions (the Department) granted Petitioner Robert

Narvaez unemployment benefits for thirteen months before disqualifying him from benefits

and requiring that he repay the benefits because his misconduct caused his employment
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separation. We reverse the district court’s order upholding the Department’s action because

the Department did not proceed in accordance with the Unemployment Compensation Law,

NMSA 1978, §§ 51-1-1 to -59 (1982, as amended through 2012) and the Department’s

regulations.

BACKGROUND

{2} Petitioner was employed by Respondent Southwest Tyre Ltd. (Employer). Employer

terminated Petitioner and another worker for fighting. Petitioner filed a claim with the

Department for unemployment benefits on May 16, 2010, his last day of work. Employer

did not respond to the Department’s request for information concerning the termination. The

Department granted benefits for the benefit year ending May 14, 2011, beginning the week

ending May 29, 2010. Petitioner filed a second claim for benefits for a new benefit year on

May 15, 2011. Employer again did not contest the claim.

{3} On June 28, 2011, the Department initiated telephone contact with Petitioner and

Employer. A memorandum concerning the telephone contact with Employer indicates that

the telephone contact was the first time Employer responded to the Department concerning

the reason for Petitioner’s separation from employment. Employer informed the

Department, as did Petitioner at that time and in his original claim, that Petitioner was fired

for fighting with another employee.

{4} On the same day, June 28, 2011, the Department sent Petitioner a notice of claim

determination, informing him that he was disqualified from receiving benefits because of his

misconduct for fighting on the job. It also sent Petitioner an overpayment notice, informing

him that he was liable to repay the Department for fifty-eight weeks of benefits in the

amount of $27,902.

{5} Petitioner filed an administrative appeal. An administrative law judge determined

on behalf of the Department’s appeals tribunal that Petitioner was disqualified from benefits

but did not address overpayment. The Department’s board of review affirmed the decision.

The district court issued a writ of certiorari, and, upon review of the administrative

proceeding, upheld the decision of the board of review. It concluded that Petitioner did not

appeal the overpayment notice.

{6} Petitioner filed a notice of appeal in which he states that he is contemporaneously

filing a petition for writ of certiorari in order to ensure his appellate rights. Without

objection, we consider the appeal. Petitioner argues several issues relating to the

Department’s failure to follow the time lines of the Unemployment Compensation Law and

the Department’s regulations, the Department’s failure to accept Petitioner’s overpayment

appeal, due process, and estoppel. Because it is dispositive of the case, we address only

Petitioner’s argument concerning the Unemployment Compensation Law and the

regulations.
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STANDARD OF REVIEW 

{7} When reviewing an administrative decision regarding unemployment benefits, “[w]e

independently employ a whole record standard of review and will affirm the agency’s

decision only if it is supported by the applicable law and substantial evidence in the record

as a whole.” Miss. Potash, Inc. v. Lemon, 2003-NMCA-014, ¶ 7, 133 N.M. 128, 61 P.3d

837. “The party challenging an agency decision bears the burden on appeal of showing that

agency action falls within one of the oft-mentioned grounds for reversal including whether

the decision is arbitrary and capricious; whether it is supported by substantial evidence; and

whether it represents an abuse of the agency’s discretion by being outside the scope of the

agency’s authority, clear error, or violative of due process.” Id. ¶ 8 (internal quotation marks

and citation omitted). When engaging in whole record review, we review legal questions

de novo, including whether the agency misinterpreted or misapplied its statutory or

administrative governing provisions. See AMREP Sw. Inc. v. Sandoval Cnty. Assessor,

2012-NMCA-082, ¶ 7, 284 P.3d 1118.

REQUIREMENTS OF THE UNEMPLOYMENT COMPENSATION LAW

AND DEPARTMENT REGULATIONS

{8} Under the Unemployment Compensation Law, persons who become unemployed

“through no fault of their own” may receive benefits from the unemployment compensation

fund. Sections 51-1-3, 51-1-4(A). They must make a claim for benefits in accordance with

regulations prescribed by the secretary of the Department. Section 51-1-8(A). A

Department claims examiner must promptly review the application to make determinations

that include a claimant’s eligibility and disqualification. Section 51-1-8(B). A person is

disqualified under the Unemployment Compensation Law and not eligible to receive benefits

if the person either left employment voluntarily without good cause or was discharged for

misconduct. Section 51-1-7(A)(1), (2).

{9} The Unemployment Compensation Law further provides procedure for the

processing and appeal of claims. The claims examiner must “promptly notify the claimant

and any other interested party of the determination [of the claim] and the reasons therefor.”

Section 51-1-8(B). The claimant’s most recent employer is an interested party. Section 51-

1-8(C)(1). The claimant and interested parties have fifteen days from the date of the

“notification or mailing of the determination” to appeal to an appeals tribunal hearing

officer. Section 51-1-8(B). If no appeal is filed, the determination of the claims examiner

is final, subject to a redetermination by the claims examiner of a nonmonetary determination

made based on additional information not previously available within twenty days of the

original nonmonetary determination. Id. Further appeals are to the secretary and the board

of review. Section 51-1-8(F), (H).

{10} The Department’s regulations effective at the time of this case address the filing,

determination, and redetermination of claims. 11.3.300.301, 308 NMAC (1/1/03) (amended

11/15/12). The regulations require that, after a claim is filed, the Department notify the
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employer, which is then obligated to “provide the [D]epartment with full and complete

information in response to the inquiry.” 11.3.300.308(A) NMAC. If the employer does not

provide a timely response and the application does not raise a nonmonetary issue, the

Department may immediately commence benefits without additional notice.

11.3.300.308(C) NMAC. The regulations further provide that an employer’s failure to

provide a “substantive response” within ten days “shall be an irrevocable waiver of the

employer’s right to be heard before a determination is made[.]” 11.3.300.308(C)(2) NMAC.

The Department is then obligated to “immediately transmit to the parties the determination

and the reason for it” and “advise the parties of the right to appeal.” 11.3.300.308(C)(3)

NMAC. However, if “a separation issue is timely raised,” the Department must adjudicate

the claim before sending the determination. 11.3.300.308(C)(4) NMAC. The regulations

permit a redetermination of a nonmonetary determination only if specific criteria that we will

later discuss in this opinion are met. 11.3.300.308(D) NMAC.

APPLICATION OF UNEMPLOYMENT COMPENSATION LAW AND

REGULATIONS TO THIS CASE

May 16, 2010 Claim

{11} The principal difficulty in this case arises from the Department’s failure to provide

a specified notice of determination with respect to Petitioner’s May 16, 2010 claim. The

Department admits that “[a]s a result of an administrative error, a claim determination was

not issued in May 2010.” It states that the “first and only” notice of claim determination in

the administrative record concerning the separation issue is the one dated June 28, 2011. It

appears to argue that, as a result, all time frames set forth in the regulations run from June

28, 2011.

{12} However, upon receiving the May 16, 2010 application, the Department did transmit

to Employer the required notification and request for separation information. It began

providing benefits to Petitioner effective May 29, 2010, the conclusion of the ten-day period

for Employer to respond. Although it failed to provide a notice of claim determination, it

did send Petitioner a reemployment services program notice dated June 16, 2010 that

informed Petitioner that the Department had “determined that [he is] eligible for

unemployment insurance benefits.” An unemployed person is only entitled to receive

benefits if the person participates in reemployment services based on certain findings by the

Department. 11.3.300.321 NMAC (1/1/03) (amended 11/15/12).

{13} The Unemployment Compensation Law and the regulations emphasize the prompt

handling of claims. Section 51-1-8(B) requires the Department to promptly examine claims

and promptly provide notification of a determination and the reasons for the determination.

The regulations require the Department to “immediately” provide such notification. When

an employer fails to respond to the Department’s notice of claim within ten days, a

determination shall be made based on the information in the application. 11.3.300.308(C)(3)

NMAC. Only if a separation issue is “timely raised” may the Department delay such
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notification of a determination until after the Department has adjudicated the claim.

11.3.300.308(C)(4) NMAC.

{14} As to Petitioner’s claim, Employer did not respond to the notice of claim and no

separation issue had been timely raised. The Department did not request additional

information from Employer, Petitioner, or witnesses. See 11.3.300.308(B) NMAC (“Prior

to issuance of a determination . . ., the [D]epartment may request additional information from

the employer, the claimant or witnesses . . . relative to the separation of the claimant from

employment.”). The Department was obligated to make a determination and provide

Petitioner and Employer notice of its determination. It concedes that it failed to “issue” its

determination. It does not say that it did not make the determination. Notwithstanding its

failure to provide a notice of claim determination, the Department did inform Petitioner that

he was determined to be eligible for benefits and provided benefits commencing May 29,

2010 continuously for thirteen months. The Department’s administrative error in failing to

follow its required procedures and issue a claim determination does not negate the

circumstances that indicate that it had made the determination that Petitioner was entitled

to benefits.

{15} An administrative agency is bound by its own regulations. See Atlixco Coalition v.

Cnty. of Bernalillo, 1999-NMCA-088, ¶ 16, 127 N.M. 549, 984 P.2d 796; see also Hillman

v. Health & Soc. Servs. Dep’t, 92 N.M. 480, 481, 590 P.2d 179, 180 (Ct. App. 1979). The

circumstances of this case demonstrate the rationale for the requirement of promptness and

the time frame of the regulations. If the Department could fail to follow the time frame for

notice, a claim could continue indefinitely without being resolved. By requiring specific

action by the Department within a specific time frame, the regulations avoid the uncertainty

that could result from the lack of prompt action by the Department. An administrative error

does not alter the failure to follow the regulations that require the Department to act

promptly on claims. It certainly does not extend the time limits of the regulations.

{16} This case is different from Millar v. New Mexico Department Of Workforce

Solutions, 2013-NMCA-__, __ P.3d __ (No. 31,581, Jan. 31, 2013). In Millar, the

department did not provide immediate notice that the employer had appealed a claim

determination, and the claimant did not receive notice of the appeal until more than five

months later when the department sent notice of hearing. Id. ¶ 3. The claimant appealed the

department’s overpayment determination. Id. ¶ 4. This Court addressed the issue of whether

the hearing conducted more than five months after the claimant had been awarded benefits

violated state and federal law. Id. ¶ 10. We concluded that the Unemployment

Compensation Law merely incorporated the federal regulation at issue by reference and that

the federal regulation that required hearings to be commenced and decided “with the greatest

promptness that is administratively feasible” merely established nonmandatory guidelines.

Id. ¶¶ 13-14 (internal quotation marks and citation omitted). In this case, to the contrary, we

address the Department’s regulations that provide specific mandatory time frames.

{17} The result of the administrative process in this case was that Petitioner’s May 16,
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2010 claim was determined in his favor. There was no appeal. While we agree with the

Department that Employer did not waive its right to be heard in an appeal because it did not

respond to the Department’s notice within ten days, we assume that the Department also did

not transmit notice of its determination to Employer. It thereby essentially foreclosed

Employer’s opportunity to be heard by its administrative error.

Connection of the May 15, 2011 Claim to the May 16, 2010 Claim

{18} The Department assigned Petitioner’s May 16, 2010 claim a benefit year ending May

14, 2011. See § 51-1-42(P) (2007) (amended 2010) (defining “benefit year” in part as “the

one-year period beginning with the first day of the first week of unemployment with respect

to which the individual first files a claim for benefits . . . and thereafter the one-year period

beginning with the first day of the first week of unemployment with respect to which the

individual next files such a claim for benefits after the termination of the individual’s last

preceding benefit year[.]”). On May 15, 2011, Petitioner filed a new claim for the next

benefit year.

{19} The Department followed its procedures and provided notice of the claim and a

request for separation information to Employer. The form in the record titled “Employer’s

Statement” is not completed in any way. It is not clear from the record that the Department’s

form intended to elicit information from Petitioner was sent to him. Although it reflects that

it was sent May 23, 2011, it states “do not send” in three places on the form in connection

with questions concerning Petitioner’s separation from employment.

{20} On May 25, 2011, the Department provided Petitioner with a notice of claim

determination, informing him that it denied his new claim because he had not returned to

work and earned five times his new weekly benefit amount as required by Section 51-1-5(B).

The Department nevertheless determined that it would continue to provide Petitioner

emergency unemployment compensation on his old claim if he was otherwise eligible.

{21} On June 28, 2011, a representative of the Department made telephone calls to both

Petitioner and Employer concerning Petitioner’s separation from employment. The

Department on the same day sent its notice of claim determination, advising Petitioner that

because he was discharged from employment for fighting on the job, which was misconduct,

he was disqualified from benefits effective the calendar week ending May 22, 2010.

{22} Because it disqualified Petitioner from benefits effective the calendar week ending

May 22, 2010, the June 28, 2011 notice of claim determination acted on Petitioner’s May

16, 2010 claim, not the May 15, 2011 claim. Petitioner does not argue that the Department

erred in its determination of the May 15, 2011 claim, and we do not address that claim

determination in this opinion. The two claims become intertwined, however, because the

Department took action on the May 16, 2010 claim only after Petitioner filed the May 15,

2011 claim.
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{23} But the regulations do not authorize the Department’s June 28, 2011 action in

connection with the May 16, 2010 claim. As we have discussed, the Department had

determined the May 16, 2010 claim and provided benefits. This is not a claim based on false

statements or misrepresentations, which, under the Unemployment Compensation Law and

the regulations, are void. Section 51-1-38(D); 11.3.300.314(A) NMAC (1/1/03) (amended

11/15/12). The law and regulations permit the Department’s action re-opening Petitioner’s

May 16, 2010 claim only upon redetermination. The criteria for redetermination include:

(1) The adjudicator perceives the need for reconsideration either

as a result of a protest by an interested party or on the adjudicator’s own

initiative due to new or additional information received. Examples of the

type of errors which may prompt a redetermination are . . . an additional fact

not available to the adjudicator at the time of the determination excluding

those facts the employer and claimant had the opportunity to provide prior

to the initial determination[.]

. . . .

(4) A redetermination can be issued no later than the twentieth

calendar day from the original determination date or twenty days from the

date of the first payment deriving from the original determination, whichever

event occurs latest.

11.3.300.308(D) NMAC.

{24} First, we do not consider the information obtained in the June 28, 2011 telephone

calls to be the type of new or additional information contemplated in the regulations.

Information that Petitioner or Employer could have provided prior to the initial

determination is not sufficient. The information the Department received in the telephone

calls was information it could have received in the initial process had Employer timely

responded or if the Department had conducted a timely investigation. Second, a

redetermination was not timely. The Department may issue a redetermination only within

the later of twenty calendar days from the original determination or twenty days from the

date of the first payment made under the original determination. 11.3.300.308(D)(4)

NMAC. We do not know the precise date of the original determination because of the

Department’s administrative error in failing to provide notice of it. The first payment was

made on the week ending May 29, 2010. A determination made approximately thirteen

months after either triggering event does not fall within the time limits of the regulations.

CONCLUSION 

{25} The Department’s regulations provide specific time frames for the Department to act

on claims. They provide a window for the Department to make a determination about

entitlement to benefits. The Department did not act in accordance with the time frames of
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its regulations in its determination that Petitioner was not entitled to benefits. We reverse

the decision of the board of review.

{26} IT IS SO ORDERED.

____________________________________

JAMES J. WECHSLER, Judge

WE CONCUR:

____________________________________

MICHAEL D. BUSTAMANTE, Judge

____________________________________

M. MONICA ZAMORA, Judge