NO. COA13-452

NORTH CAROLINA COURT OF APPEALS

Filed: 21 January 2014

CYNTHIA A. BAILEY,

Petitioner,

v. Buncombe County

No. 12 CVS 05163

DIVISION OF EMPLOYMENT SECURITY, 

NORTH CAROLINA DEPARTMENT OF 

COMMERCE,

Respondent.

Appeal by respondent from order entered 14 January 2013 by 

Judge C. Philip Ginn in Buncombe County Superior Court. Heard in 

the Court of Appeals 26 September 2013.

Adams Hendon Carson Crow & Saenger, P.A., by John C. Hunter, 

for petitioner-appellee.

North Carolina Department of Commerce, Division of Employment 

Security, by Timothy M. Melton, for respondent-appellant.

STEELMAN, Judge.

Where the trial court adopted all of the findings of fact 

made by DOC, which as a matter of law supported DOC’s ruling that 

petitioner engaged in misconduct, the trial court erred in 

reversing the decision of DOC.
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I. Factual and Procedural Background

Cynthia A. Bailey (plaintiff) was employed by Pro Temps 

Medical Staffing (Pro Temps). On 11 December 2011, plaintiff’s 

employment with Pro Temps was terminated. On 1 January 2012, 

plaintiff filed a claim for unemployment benefits. An Adjudicator 

found that plaintiff was assigned to monitor a patient who was on 

suicide watch; that plaintiff was found sleeping on the job; and 

that plaintiff was discharged due to this misconduct and was 

disqualified from receiving unemployment benefits. On 2 April 

2012, plaintiff appealed pro se to the Appeals Referee.

On 1 May 2012, the Appeals Referee heard the appeal. The 

Appeals Referee affirmed the Adjudicator’s determination, and held 

that plaintiff was discharged due to misconduct, and therefore was 

disqualified from receiving unemployment benefits. The Appeals 

Referee further found that while plaintiff was sleeping, the 

suicide-watch patient had been wandering the halls of the hospital. 

On 31 May 2012, plaintiff appealed pro se to the North Carolina 

Department of Commerce, Division of Employment Security (DOC).

On 26 September 2012, DOC adopted the facts found by the 

Appeals Referee, concluded that the Appeals Referee correctly 

applied the law, and affirmed the decision that plaintiff was 

disqualified from receiving unemployment benefits. On 26 October 
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2012, plaintiff filed a petition for judicial review to the 

Superior Court of Buncombe County.

On 15 January 2013, the trial court entered its order on 

judicial review, and held that plaintiff was not disqualified to 

receive unemployment benefits.

DOC appeals.

II. Standard of Review

“In cases appealed from administrative tribunals, we review 

questions of law de novo and questions of fact under the whole 

record test.” Diaz v. Div. of Soc. Servs., 360 N.C. 384, 386, 628 

S.E.2d 1, 2 (2006). A determination that an employee has engaged 

in misconduct under N.C. Gen. Stat. §§ 96-14 and 96-15 is a 

conclusion of law. See e.g. Williams v. Burlington Indus., Inc., 

318 N.C. 441, 456, 349 S.E.2d 842, 851 (1986) (referring to “the 

referee's conclusion that petitioner was discharged for 

misconduct”).

[I]n cases appealed from an administrative 

tribunal under [Article 3 of North Carolina’s 

Administrative Procedure Act], it is well 

settled that the trial court’s erroneous 

application of the standard of review does not 

automatically necessitate remand, provided 

the appellate court can reasonably determine 

from the record whether the petitioner’s 

asserted grounds for challenging the agency’s 

final decision warrant reversal or 

modification of that decision under the 

applicable provisions of N.C.G.S. § 150B-
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51(b).

N.C. Dep’t of Env’t & Natural Res. v. Carroll, 358 N.C. 649, 665, 

599 S.E.2d 888, 898 (2004). 

When the issue on appeal is whether a state 

agency erred in interpreting a statutory term, 

an appellate court may freely substitute its 

judgment for that of the agency and employ de 

novo review. Although the interpretation of a 

statute by an agency created to administer 

that statute is traditionally accorded some 

deference by appellate courts, those 

interpretations are not binding. The weight of 

such [an interpretation] in a particular case 

will depend upon the thoroughness evident in 

its consideration, the validity of its 

reasoning, its consistency with earlier and 

later pronouncements, and all those factors 

which give it power to persuade, if lacking 

power to control.

N.C. Sav. & Loan League v. N.C. Credit Union Comm’n, 302 N.C. 458, 

465-66, 276 S.E.2d 404, 410 (1981) (citations and quotations 

omitted).

II. Trial Court’s Standard of Review

In its first argument, DOC contends that the trial court 

disregarded the standard of review set out in N.C. Gen. Stat. § 

96-15(i). We agree.

N.C. Gen. Stat. § 96-15, concerning the procedure as to claims 

for unemployment benefits, provides that, in any judicial review 

of a decision by DOC:

the findings of fact by the Division, if there 
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is any competent evidence to support them and 

in the absence of fraud, shall be conclusive, 

and the jurisdiction of the court shall be 

confined to questions of law. Such actions and 

the questions so certified shall be heard in 

a summary manner and shall be given precedence 

over all civil cases.

N.C. Gen. Stat. § 96-15(i) (2013).

In the instant case, the Appeals Referee found that:

3. According to the employer's policies and 

procedures, of which the claimant knew or 

should have known, if an employee is found to 

be asleep or giving off the appearance of 

sleep while he/she is supposed to be 

performing job duties, then said employee may 

be subjected to an immediate discharge from 

employment.

4. On the claimant's final day of 

employment, she [claimant] was found asleep in 

a patient's room. The claimant was supposed to 

be providing sitter duties for said patient.

5. The above-mentioned patient was on 

"suicide watch" and left the room while the

claimant was asleep.

6. A nurse woke up the claimant and informed 

her [claimant] that the patient she was to be 

watching over was outside of his room at the 

nurses' station.

7. The claimant was discharged from this job 

for sleeping during her work shift while she 

was supposed to be performing her job duties.

The Appeals Referee concluded that:

the claimant fell asleep while she was 

supposed to be watching over a patient as a 

certified nursing assistant/sitter. The 
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employer's policies allow for an employee to 

turn down patients and/or shifts if he or she 

thinks it would not be prudent or possible to 

perform job duties whether that decision is 

based on one's comfort level or level of 

fatigue. The claimant did not turn down 

providing sitting duties for the above-noted 

patient during her agreed to work shift. The 

claimant's actions were a willful disregard of 

the employer's interests and a disregard of 

the standards of behavior that the employer 

rightfully expected of the claimant. As such, 

the claimant was discharged for misconduct in 

connection with the work.

On appeal from the Appeals Referee, DOC held that:

As the ultimate fact-finder in cases involving 

contested claims for unemployment insurance 

benefits, the undersigned concludes that the 

facts found by the Appeals Referee were based 

on competent evidence and adopts them as its 

own. The undersigned also concludes that the 

Appeals Referee properly and correctly applied 

the Employment Security Law (G.S. §96-1 et 

seq.) to the facts as found, and the resultant 

decision was in accordance with the law and 

fact.

On appeal from DOC, the trial court found simply that “There 

is competent evidence in the record to support the findings of 

fact made by the Division.” However, the trial court then 

concluded that plaintiff’s conduct was not “misconduct” which 

would merit disqualification, holding:

The Division's conclusion of law as set out in 

the Memorandum of Law Section of the 

Division's Decision is in error as a matter of 

law in that Petitioner's actions were not, 

"conduct evincing a willful or wanton 
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disregard of the employer's interest as is 

found in the deliberate violations or 

disregard of standards of behavior which an 

employer has a right to expect of an employee 

or has been explained orally or in writing to 

an employee or conduct evincing carelessness 

or negligence of such degree or recurrence as 

to manifest an intentional and substantial 

disregard of the employer's interest or of the 

employee's duties or obligations to the 

employer," and were not, therefore, 

"misconduct" as that term is defined and used 

in N.C. Gen. Stat. § 96-14(2).

N.C. Gen. Stat. § 96-14 defines misconduct as:

intentional acts or omissions evincing 

disregard of an employer's interest or 

standards of behavior which the employer has 

a right to expect or has explained orally or 

in writing to an employee or evincing 

carelessness or negligence of such degree as 

to manifest equal disregard.

N.C. Gen. Stat. § 96-14(2) (2011)1.

The findings of fact of the Appeals Referee were adopted by 

DOC, and in turn by the trial court upon appeal. These findings 

explicitly stated that Pro Temps had a policy that employees found 

sleeping were subject to immediate discharge, and that employees 

who believed themselves unable to perform had the option to turn 

down patients or shifts, and that plaintiff knew or should have 

 

1 N.C. Gen. Stat. § 96-14 was repealed by Session Laws 2013-2, 

s.2(a), effective 1 July 2013, and replaced by N.C. Gen. Stat. § 

96-14.1 et seq. However, § 96-14 was effective during the 

proceedings before the trial court, and we will therefore apply 

the definition expressed therein.
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known about these policies. Further, these findings stated that 

plaintiff was found sleeping when she had been assigned to a 

patient on suicide watch, having chosen not to turn down the shift. 

These findings all support the conclusion that plaintiff had 

engaged in misconduct, and do not support a conclusion to the 

contrary.

Nonetheless, the trial court, despite adopting these findings 

in their entirety, concluded that no misconduct had occurred. Its 

conclusion is in direct contradiction to the findings it adopted, 

and is therefore without a basis in the law.

We hold that the trial court erred as a matter of law in 

making conclusions of law which were not supported by its findings 

of fact, and reverse and remand this matter to the trial court for 

entry of an order affirming the decision of DOC.

III. Other Arguments

Because we have held that the trial court erred as a matter 

of law in reversing the decision of DOC, we need not address DOC’s 

other arguments.

REVERSED AND REMANDED.

Judges HUNTER, ROBERT C. and BRYANT concur.