### IN THE COURT OF APPEALS OF TENNESSEE AT KNOXVILLE Decem ber 4, 2003 Session
LISA D. HUCKA BEE v. MICHAEL E. MAGILL, COMMISS IONER OF THE TENNESSEE DEPARTMENT OF LABOR AND WORKFO RCE

DEVELOPMENT, ET AL 

### . Appeal from the Chancery Court for Hamilton County No. 02-0713 W. Frank Brown, III, Chancellor

FILED JANUARY 28, 2004

No. E2003-01419-COA-R3-CV

This appeal involves a claim for unemploy ment compensation be nefits by L isa Huckabee (“Claimant”). When Claimant w as hired by Wa tkins &Son, Inc. (the “Employ er”), the Employ er’s policy prohibiting fraternization between employees wa s explained to her. Nevertheless, Claimant began a consensual affair with a coworker. The coworker’s employ ment was terminated when the Employer learned of the affair. I

t is disputed as to whether Claimant was discharged or quit before she could b e discharged. The Board of Review concluded that Claimant was disqualified f rom receiving benefits regardless of whether she quit or

was discharged. The Trial Court reversed after concl udin g, inter al ia, that the issue of whether Claimant was discharged f or work related misconduct

was not an issue the

Board o f Review

could pro perly consider because the Employ

er did notraise that issue at the previous two administrative levels. The Trial Court also concluded th at the decision by

the Board of Review was n ot sup ported by substantia

l and mate rial evidence . We reverse the judgment of the Trial Court and re instate the judgment of the Board of Review. Tenn. R. App.P. 3 Appe al as of Right ; Judgme nt of the Chancery Court Reversed; Case Rem anded

. D. M ICHAEL S WINEY , J., delivered the opinion of the court, in which C HARLES D. S USANO , J R ., J., joined, and H OUSTON M. G ODDARD , P.J .,not parti cipat ing. Stephen S. Duggins, Chattanooga, Tennessee, for the Appellant Watkins & Son, Inc.

Paul G . Summers, Attorney Gene ral and Reporter, and Warren A. Jasper, Assistant Attorney Genera l, Nashville, Tennessee, for the Appellee Michael E. Magill, Commissioner, Department of Labor and Workforce

Development. Brian C. Frye, Chattanooga, Tennessee, for the Appellee Lisa D. Hucka

bee.1 Although not pertinent to the is sues on appeal, we are as s um i ng t ha t Mr . Watkins and M rs. Watkins are husb and and w ife.
-2- OPINION Background

Claimantworked for

the Employ

er in a c lerical

position fr

om July of 2000 until her employment

ended on Novembe

r 3, 2001. The issue s on appe al cente r around whether Claimant is entitlement

to unemplo yme

nt compen sation be

nefits. T he Employ

er indic ated on th e Separation Notice sent to the Department of Labor and Workforce Development (“Department”) that Claimant voluntar ily q uit her employment. L ater in the proceedings, however , the Employer took an alternative position, arguing that if Claimant did not quit, then she was discharged f or work related misconduct. Claimant h as mainta ined fro m th e out set that sh e was fir ed beca use she be

came “involved” with a coworker.

An initial decision was issued by an ag ency re presentative at which time Claimant’s request for unemployment compe nsation benefits was approved. The age ncy representativefound that Claimant “was separated due to fraternization. Evidence submitted is not sufficient to establi sh she quit or was discharged under disqualify ing reasons ....”

The Employ

er appe aled the

agenc y decision to th

e Appea ls Tribunal anda hearing
was conducted in March of 2002. The first witness was Karen Watkins (“Mrs. Watkins”), the Employer’s Vice President. According to Mrs. Watkins, she learned a few day s before Claimant was hired that an employee

named Rocky

Sim pson (“Simpson”) had had an affair with a cowor ker. Becau se of this, Mrs. Watkins explained to Claimant when she was hired the Employer’s unwritten policy prohibiting romantic fraternization between employ ees and the reasons for having such a po li cy.
Mrs. Watkins tes tified tha t Claimant a

pproach ed her in April of 2001, and stated that there was a rumor going around that Claimant was ha ving an affair with a coworke r named Shane. Claimantwas upse

t about the

rumor. A m

eeting was held

with th e office employ ees and the Employer’s policy prohibiting fra ternization between employee s and its sexual harassment policy
were explai ned. Claimant was n ot prese nt at the meeting because sh e was ve ry upset abo

ut th e rumor and the Employer’ s President, Edward Watkins (“Mr. Watkins”), thought Claimant might be too embarrassed to attend. 1

Mrs. Watkins testified that she was told in early September of 2001, that Claimant
was having

an affa ir wit h Simpson. When Mrs. Watkins spoke to Claimant about what she had heard, C laimant denied having a relationship with Simpson. Mrs. Watkins assumed Simps o n likewise would deny having

an affair, so the matter was not pursued any further at that time. However, the next month Mrs. Watkins learned that Claimant was pregnant and Simpson was the child’s father. Because of this, Simpson’s employ ment was terminated the following day , which was
a Saturday. Simpson bega n cl eaning

out h is truck after he was fired at which time Mrs. Watkins-3-

informed him that she would be speaking with Claimant on Monday . Mrs. Watkins testified that she
was unsur e what to do regarding Claimant’s employ ment because Claimant was pregnant and, t herefore, she want

ed to spea

k with an a

ttorney prior to ta

king an y a ction. I n any event, afte r speaking with Simpson on that Saturday, Mrs. Watkins traveled to Ge org ia to visit her mother. While en route, she received a phone call from Ronda Swaf ford (“Swaf

ford”) , the Emplo ye

r’s Safe ty Supervisor. Swafford informed Mrs. Watkins that Simpson hadcalled wanting to speak with her. After Simpson was given Mrs. Watkins’ cell phone number, he called her and inf ormed her that he had spoken with Claiman t and the t wo of the m were “ going

to come in to clean out her desk,” which they did. The following Monday , Claimant did not report to work. Claimant and Simpson did, however, inform Swa

fford th at they

wanted to

come in a

nd pick up

their Sep aration

Notices. Mrs. Watkins then called the Employ er ’s attorney seeking guidance on how to char acterize Claimant’s separation from empl oym ent. Acc ording t

o Mr s. W atkins, sin

ce she ha d not actu ally

met with Claimantto discuss the situation and because Clai mant simply ca me in and cleaned out her desk, Mrs. Watkins wa s told

to indicate on the Separation Notice that Claimant had quit. Claimant and Simpson picked up their Separation Notices the following day

. Cl aimant was upset because the Separation Notice indicated she had quit, and she told Mrs. Watkins that it should be ch anged to indicate that she had been fired. Mrs. Watkins stated that Claimant was not discharged because she effec tively

quit when

she came in and cleaned out her desk. Mrs. Watkins then added that “I didn’t discharge her but I

would have after I

talked to my attorney .”

Mr

. Watk ins also te stified a t the hea ring and his testim

ony was, for the most pa

rt, consistent w ith his wi fe’s testimony. Acc ording to Mr. Watkins, after he learned Claimant was pregnant and Simpson was the father, he wanted to terminate both of them. However , that did not happen immediately beca use Mrs. Watkins believed the y sh ould speak with an atto rney prior to terminating Claimant. Mr. Watkins testified that Simpson was terminated on a S at ur da y, and later that day Simpson and Claimant returned to the pre mises and cleaned out Claimant’s desk.

Swafford was the final wi tness to t estify on the Empl oye

r’s beha lf. Acco rding to Swafford, she observed Simpson slamming doors in the officesometime in October of 2001. When Swafford asked Simpson what

was wrong, Simpson told her that he had been seeing Claimant and she had broken up with him. Soon thereafter, Claimant and Simpson had a discussion and Simpson appeared to calm down. Claimant then i nformed Swafford that she and Simpson were no longe r going to see eac

h other. A

ccordin g to Swaf

ford, at this point sh

e discuss ed with Cla

ima nt th e Employer’s policy

prohibit i ng fraternization among employ ees. According to Swafford, she explained to Claiman

t “in no unc ertain te

rms, that at thi s point in tim e, that th is would go no further, butit was to be stopped because fraternization is not per mitted.” Swafford also testified to a telephone call she rec eive d from Simpson’s wife, who apparently called to tell Swafford that Claimantand Simpson were no longer seeing e ach other and Swafford did not

have to worry

about that situation any longer

.

The next event discussed by Swafford occurred on November 1, 2001, when Claimant told Swafford she was p

regna nt, Simpson was the father, and she (i.e. Claimant) did not know what to do. Swafford told Claimant she needed to explain the situation to Mrs. Watkins. Ac cording to Swafford:-4- [Claimant] then told m e that she had alre ady

previous ly li ed to Ms. Watkins so she could not go to Ms. Watkins and tell her the truth. I then told her that ... I would have to g o to [the Watkins’] .... I didn’t have a choice . ... [Claiman t asked] me

if I would please just make it possible for Mr. Simp son t o stay and she wo uld k indl y leave and go her ow n w ay, knowing that she had lied and she had broken company policy. And that’s exactly what ... [she] said to me.

Swafford was present when Claimant and Simpson returned to the premises to clean outClaimant’s desk. Swafford stated that when they arr

ived, Claimant told her that she was going to be fine, that she was moving in with Simpson, and “that she was going to go upstairs and c lean outher desk.” After the desk was clea ned out, Claimant and Simpson told Swafford “good-bye” and left the premises. Claimant did not report to work the following Monday

. On Tuesday, Claimant returned to pick up her separation notice and was upset

because the notic e stated

that she h ad quit.

The next witness was Claimant. When testifyingto her ve rsion of e vents and how her empl oym

ent ende d, Claiman

t stated:

On November the 3 rd , which was a Saturday , I was told by Rocky Simpson that he wa s fired b y ... [M r. and Mr s. ] Watkin s and that Karen[Watkins] had come up to his tru ck and tol d him to tell me to come in the off ic e that da y and clea

n my desk out. He ca

me home, where I was at, a

nd told me th at Karen wanted me to come in and clean my de sk out....

Claimantfurther testified

that when she returned

to clean out her desk, Mr. Watkins would not tell her why she wa s fired a nd o nly told her to clean o ut her desk. At th e heari ng, Claimantadmitted t

o having an affair with Simpson. However, she stated that they wer

e “broken up” the first time Mrs. Watkins inquired if they were having an affa

ir, which is why Claimant denied having any rela

tionship. Claimant admitted she was aware of the Employer’s policy pr ohibiting fraternization between employ ees and that she was informed of this policy when she wa s hired. She also admitted Mrs. Watkins had explained the policy to her on two differ ent occasions. Claimant denied ever telling any

one that she was quitting. Simpson testified on Claimant’s behalf. Simpson stated that when he was cleaning outhis truck after he had been fired, Mrs. Watkins told him to tell Claimant to “come in and clean her desk out or

to call me.” To Simpson’s knowledge, no one ever actually stated that Claimant was fired.

The Appeals Tribunal was the next step in th is proce ss, and it a

lso found i n Claimant’s favor. The Appeals Tribunal concluded that the Employ er neve r actua lly told Claimant she was being discharged. Instead, she was simply told to clean out

her desk. The Appeals Tribunal determinedthat Claimanthad been constructively discharged and the Employ er failed to establi sh intentional work related misc onduct by Claim ant . According to the Appeals Tribunal, Claimant-5-

“was discharged without

reason or cause after the e mployer told her to g o upstairs and clean out her desk.” The Appeals Tribunal discusse d at some le

ngth wha t “miscond

uct” by an employ

ee is, and specific ally

found that the facts did not show that Claimant was guilty of misconduct and, therefore, she was “discharged without reason or cause . . . .”

The Employer appe aled the decision of the Appeals Tribunal to the Board of

Review (“Board ”), and t he Board reversed the dec ision of the Appeals Tribunal. In so doing, the Board noted that the fraternization policy ha d been disc

ussed with

Claimant. According to the Board, af ter Simpson was t ermin ated Mrs. Watkins told Simpson that Claimant would need to “come in and clean out her desk or call me.” Mr . Watkins subsequently receive d word that the claimant had contacted Swafford and told her

that she would be coming in to clean out her desk. The Boa rd also pointed out that Claimant told Swafford that she had lied to Mrs . Watkins a bout having an af

fair with Simpson. After reviewing the fac ts, the Board concluded that the evidence was sufficient to show that Claimant was discharged for misconduct within the meaning of Ten n. Code Ann. § 50-7- 303(a)(2). The Board then stated:

A preponderance of t

he e vidence

shows cir

cumstanc es that wo

uld
reasona bly lead the claimant to believe that she had been terminated from this employment. The comments from the employ er ’s vic epresident to the co-worker and from the employ er’s pr esident to the claimant express a

sufficie nt intent t o effect a discharge . The claimant was admittedly aw are of the employer’ s policy

prohibiting frate rn ization among e

mploy ees and w as awar

e, or ce rtainly should have been aware, that her continued employ ment was in jeopardy a s a result of her admitted “affair” with the co-worker. Such conduct
was a d eliberate and direct violation of a known policy and substantia lly disregarded the

employer intere sts. A preponderance of the evidence establishes misconduct by the claimant in this case.

The Board also finds arguable mer it to the employer’s contention that the claimant

actually voluntar ily q uit this employ

ment. The facts are sufficie ntly in dispute and, although the greater we ight of the evidence sugge sts a disch arge s ituation, t he Boar d finds tha

t a denial of benefits would also be fo und had t he matter been de cided asa voluntary quit situation as the circumstances do not show good workrelated cause for such a sepa ration.

After the Board of Review’s opinion was issued, Claimant timely filed a Petition for Certiorari in the Hamilton County Chancer y Court (“Trial Court”) seeking reve rsal of the Board’s decision. The Trial Court granted the petition and reversed theBoard’s decision. I n summary, the Trial Court stated:
(a) The issue decided by the Boa

rd was whether Claimant
was di s charged for misconduct under Te nn. Code Ann. § 50-7-2 Th e D epa rtmen t of Lab or an d W orkfo rce D evelo pme nt is also a party to thi s appeal an d argues the Trial Court

erred when it reverse d the d ecision of the B oard of Re view.
-6- 303(a)(2), but this particular issue never should have been considered by the Board because the issue as orig inally submitted by

the parties was whet her Claim ant volunt

arily quit; (b) It was improper for the Board of Review to decide the
case based on an y g rounds oth er than w hether Cl aimant vo luntarily quit her e mploy ment; (c) Becau se the Employer listed “voluntary quit” on t he Separation N otice and argued only this position at the first two administrative levels, due process and notions of fair play prohibited the Employer from a

rguing to the Board of Review that Claimant had been disc harge d for wor

k relate d miscondu ct; (d) While the Employer had the right to

fire Cla imant, it didnot actually do so as evide nce d by the

Watkins’ testimony that they wanted to seek advice from an attorney prior to discharging Claimant;
(e) The Board of Review’s “alternative” hold ing to the effect that eve n if Claima

nt w as not discharged for cause, she w as still ineligible for

benef its because she voluntarily terminated her employment

was beyond

the scope of the issue presented to the Board for res olution; (f) There was no substan ti al evidence to support the conclusion that Claimant voluntarily quit her employ ment; and (g) Claimant ’s misconduct was not suffici ent to disqualify her from receiving unemploy ment benefits.

After the Tria l Court reversed t

he Boar d’s deci sion, the E

mploy er filed

a motion to alter or amend the judgment which w as de nied by the Trial Court, re sulting in this appeal. The Employer appe als raising the following issues, which we quote: 2

1. Whether

the Chanc ery

Court err ed as a matter of law by concluding that it was improper for the Department of Labor and Workforce Development to consider whether the employ ee/claimant voluntar ily

q uit her job and whether she was discharg ed for workrelated misconduct.-7- 2. Whether

the Chancery

Court erred as a matter

of law by holdin g that [Claimant’s] affair with another employee in direct
an d knowing violation of company policy was insufficie nt misconduct

to disqualify [Claimant] from receiving unemploy ment benefit s.
3. Whether

the Chancery

Court erred

as a matter of law by ignoring major components of evidence indicating that

[Claimant] voluntar ily quit her e mploy ment and b y a

ccordin gly

concluding that there was no sub stan tial evide nce indic ating th at [Claiman t] voluntar ily q uit her e mploy ment.
Discussion

Trial courts a

nd appell ate cour

ts utilize the same standard of review when revie wing deci sions of

an administrative agency involving claims for unemployme nt compensation. See Armstrong v. Neel , 725 S.W.2d 953, 955 n.1 (Tenn. Ct. App. 1986). The standard as framed in terms of the tri al court 's revi ew and a s applica ble to this a

ppeal is a s follows:
(2) The chancellor

may aff irm the decision of the board or the chancellor may

reverse, re mand o r modify the dec ision if the rights of the pe

titioner h ave bee

n preju dic ed because the administrative findings, inferences, conclusions or dec isions are:
(A) In vio lation of c onstitution al or stat uto r y provision s; (B) In excess of the

st at ut or y au th or it y of

th e a ge nc y; (C) Made upon unlawful procedure;
(D) Arbitrary or

capricious or

characterized by

abuse of discretion or c lear ly unwarra nted exercise of discretion; or
(E) U nsuppo rted by

evidenc e which isboth substantial and ma terial in the light of the entire record.
(3) In determining the substantiality of evidence, the chancellor

shall take

into acc ount what

ever in t he reco rd fairl y detrac ts from its weight, but the chanc ellor s hall not substitute the chance llor's judgment for that of the boar d of revi ew as to

the weight of the evidence on questions of fact. No decision of the boar d shall be-8- reversed, remande d or modif ied by the chancell or unles s for errors which affect the merits of the final decision of the boa rd.... Tenn. Code Ann. § 50-7-304(i)(2)-(3).

In Jones v. Bureau of TennCare, 94 S.W.3d 495 (Tenn. Ct. App. 2002), this Court discusse d the conc ept of sub stantial a nd mater ial evide nce as f ollows:

The term "substantial and material evidenc e" has been de fined
as "'such re levant e vidence as a rea sonable m

ind might accept to support a ration al conc lusion and such as to

furnish a

reasona bly sound basis for th e acti on und er cons iderat ion. '" Papachristou v. Univ. of T

ennessee , 29 S.W.3d 487, 490 (Tenn. Ct. App. 2000) (quoting Clay Co. Ma

nor, Inc. v. State , 849 S.W.2d 755, 759 (Tenn. 1993)). This Court has also desc ribed it a s requir

ing "' something

less than a preponderance of

the evidence . . . but morethan a scintilla or glimm er.'" Gluc

k v. C ivil S erv. Comm'

n , 15 S.W.3d 486, 490 (Tenn. Ct. App. 1999) (quoting Wayne Co. v. State Solid W aste Di sposa l Control Bd. , 756 S.W.2d 274, 280 (Tenn. Ct. App. 1988)). Judicial review of an ad mini strat ive agen cy's decision under the "substantial and material evidence" standard, howe ver, s ubjec ts th e agency's decision to close scrutiny. Sanifill of Te nnessee , Inc. v. State Solid Waste Disposal Control Bd. , 907 S.W.2d 807, 810 (Tenn. 1995).

Jones , 94 S.W.3d at 501. If the record contains sub stantial a nd material evidence to support the factual findings of the Board, then we ar e “limited to a review of the questions of law presented.” Frogge v. Dave nport, 906 S.W.2d 92 0, 922 (Te nn. Ct. App. 1 995) ( quot ing Perryman v. Bible , 653 S.W.2d 424 (Tenn. Ct. App. 1983)). In addition, we must construe the disqualification provisions of Ten n. Code Ann. § 50-7-303 liberally in favor of the employ ee. Simmons v. Culpepper , 9 3 7 S.W.2d 938, 944 (Tenn. Ct. App. 1996).

In the pres ent case , the Tria l C ou rt reaso ned that t

he Employ

er could procee d only
on the theory that

Claimant v oluntaril

y qu it becau se: (1) th

e Employ er state d Claimant

voluntar ily quit in the Separation Notice the Employ er filed with the Department; an d (2) tha t was the o nly argument advanc ed by

the Emp loyer at the first two administrative levels. When deny ing the Employer’s motion to alter or a mend the judgment, the Trial Court stated:

The court foundno specific authority f or the proposition that the employer c ould not ch ange th e basis f or termin ation as th

e case went through the appeal proces s. Howeve r, such w ould seem

to violate due process and notions of fair play

. Ini ti al ly, we must state that we are at a loss as to h ow due pr

ocess and notions of

fair play would be violated if the Employer is allowed to make the alternative argument that if Claimant-9-

didnot quit, then she was discharged for work related misconduct. Claimant has argue d from the very incepti o n of this case that she was discharged r ather than quit. We also note that the initial decision by the

agenc y r eprese ntative st ated tha t “[e]vidence submitt

ed is not sufficient to est

ablish she quit or was discharged under disqualifying reaso ns . . . .” (e mphasis added). At the next step of the process, the Appeals Tribunal also determined both that the Employ er had failed

to establi sh intentional work related mis con duct and that Claimant “was discharged without reason or cause after the Employer told her g o upstairs and clean out her desk.” (emphasis added). Contrary to the Trial Co ur t’s holding , the firs t two admin istrative levels did

both consi der and a

rrive a t a determination as to whether the evidence was sufficient to establish that Claimant’s discharge was for misconduct or

under disqualifying

reasons/for cause. The

Board o f Review

disagr eed with t heir conclusi ons. Therefore, we hold that it was error by the Trial Courtto reverse the Board of Review on due pr ocess g rounds.

The facts in

this case certain ly a re contr adictor y is some res pects, a s is often the case when someone loses his or her job. There are, however, several key undisputed facts in this case, which are: (1) the Employ er’ s frat ernizatio n policy and the r

easons be hind it wer

e explaine d to Claimantwhen she was hire d; (2) the frater nization po licy

was explained to Claimant on at least two occasio ns; (3 ) s he un de rs to od th e p ol ic y; (4) she knowingly violated the policy; (5) whe n Claimant and Simpson “broke up,” he was noticeably upset at work; (6) when asked by M rs. Watkins whether she was involved with Simpson, C laimant responded no because they had “broken up”; and (7) Claimantonce again knowingly violated the pol ic y when she a nd Simpson r

esumed their relationship.

For

initial dis cussion purposes only, we f irst will assume that the Employer was correct in its belief that

Claimantvoluntarily quit her employ ment. An employee is disqualified f rom receiving benefit s if she vo luntarily quits her

job “witho

ut g o od cause connected with such claimant’s work.” T enn. Code Ann. § 50- 7-303(a

)(1). I n the pre sent cas e, if the

re is substantial and material evidenc e to suppor t the Board’ s alterna

tive fac tual finding that C laimant vo luntarily quit her job and the reasons therefor, then the issue of whether she had good cause to voluntarily quit her employment

is a question of law. See, e.g., Frogge v. Da venport, 906 S.W.2d 92 0, 922 (Te nn. Ct. App. 1995). As suming the Employ er’s ve rsion of e vents is corre ct in that C laimant vo luntarily quit her job b e fore she could be discharged, the n we agree with the conclusion of the B oard insofar as it stated that “a denial of benefits would also be found had the matter been decided as a voluntary quit situation as the circumstances do not show good wor k-r ela ted cau se f or s uch a se par ati on. ” In short, there wa s absolute

ly no evidenc e prese

nted that Claimant h ad good

work-re lated ca use to quit her job. Therefore, if

she did quit, she would be disqualified from receiving benefits. We conclude that there is substantial and material evidence in the recor d to supportthe Board’s conclusion that if Claimant d

id quit, then

she is disq

ualified from rec eiving u

nemploy ment comp ensation

benefit s.
Now we will as sume Claimant iscorrect when she states tha t she did not quit but was discharged

because of her r elationsh ip wit h Simpson which admittedly violated the Employ er’s policy prohibiting frat

ernizatio n betwee

n employ ees. Po licie s prohibiting fraternization among employees are not uncommon. Whe n sexual and/or romantic relationships develop in the workplace, the potential for problems can befar re aching . For exa mple, one or both of the part ners may become3 According to Nati onal Cri me Vict imi zati on Surv ey publ ish ed in December 2001 by the U. S. Depa rtme nt of

Justi ce, Burea u of Justice Statistics, approxim ately 18,70 0 violent crimes, includ ing nine deaths, are co mm itted ann ually by “a cur

rent or former boyf

riend, girl fri end, or s pouse - an int imate - of th e victim.”

-10- upset or even violent if

the rela tionshiptakes a turn for the worse. An example of this is Simpson’s behavior in the present case which took place a t work durin g o ne of the “break -ups.” Whi le Simpson’s behavior

certain ly w as not dra stic, it could have been. 3 The point being, if Simpson and Claimant had not violated the policy, this simply would not be an issue.

Another equally important rea son behind a policy prohibiting f raternization between
em pl oye es is the increased risk of a sexual harassment claim or lawsuit being filed against the employer and the accompany

ing costs, etc., associated with such a lawsuit. The threat of litigation is even hig

her whe n the cons ensual r

elationsh ip ends to th e d is ma y of one of the partners. For example, Grissom v . Metropo litan Gov. of N ashville , 817 S.W.2d 679 (Tenn. Ct. App. 1991), involved a sexual harassment claim wherein:

The jury was ca

lled upon to decide whether Mr. Hickman created a ho stile work environment for Mrs. Grissom by making unwelco me sexual advances. Mrs. Grissom claimed that she suffered
an emotional br eakdown after enduring Mr. Hic kman's sexual advances for eleven y ears. Mr. Hickman, on the other hand, claimed that he and Mrs. Grissom had been carry ing on an affair fo r elev en years.... The jury cle arly believe d Mr. Hickman and de cided tha t his sexual advanc es ... wer

e welco med and th at they did not crea te a hostile wo

rk envir onment fo

r Mrs. Gr issom.

Gris som , 817 S. W.2d at 684. See also Chamblee v. Harris & Harris, Inc. , 154 F. Supp.2d 670 (S.D.N.Y.2001) (permitting an employ ee who had previously had sexual relations with her supervisor

to proce ed to trial with her hostile work environment claim respecting his beha vior towardher after she refused to continue the r elationship); 45B AmJur2d Job Discrimination § 835 (2002)(Discussing the effe ct “of a prior co nsensual

affair on an eva

luation of whether conduct i s ‘unwelcome’”). We nei ther intend nor need to discuss each and every valid reason behind fraternization policies, but suffice it to say there are several. Returning to the undisputed fact s in the present case, it is abundantly clear that Claimantintentionally violated a known company policy on at least two occ asions. The issue to be decided by the Trial Court was whe ther there was substa

ntial and materia l evidenc e to support the Board’s conclusion that Claimant’s “conduct was a deliberate and direct violation of a known policy and substantially disrega

rded the employer intere sts. A preponderance of the evidence establishes misconduct

by t he claima nt in this case.” In our opinion, ther e is much more than just substantial and material evidence to support this conclusion by the Boar d. Our conclusion is not cha nged sim ply because the Employ er belie ved Claimant quit before it had the opportunity to discha rge her, even if that belief was mistaken. Likewise, whether Claimant’s dischar ge is characterized as a direct or-11-

constructive discharge does not alter this final result. There fore, we hold the T rial Court erre d in
revers ing the B oard’s d

ecision o n these g

rounds.

In summary , we conc lude that regar dless of w hether Cl aimant qu

it or was disch arged, we find no basis for reversing the Boar d on any of the statutory

grounds. There is substantial and material evidenc e in the r ecord to support th

e Boar d’s conc lusion tha

t she is d isqualified from receiving benefits.
Conclusion

The j udgment of the Trial Court is reversed; the judgment of the Board of Revie w is reinstat ed in its en

tirety ; and this c ause is remanded to the Trial Court for further proceedings as
are necessa

ry , if any , consiste

nt with this Opinion and for c ollection of the co sts below. The costs on appeal are assessed ag ainst the Appellee, Lisa D. Hucka bee.

___________________________________ D. MICHAEL

SWINEY, JUDGE