Source: http://mn.gov/law-library-stat/archive/ctapun/0202/1417.htm
Timestamp: 2018-10-20 04:37:55
Document Index: 725913009

Matched Legal Cases: ['§ 24', '§ 24', '§ 24', '§ 24', '§ 24', '§ 24', '§ 24', '§ 24', '§ 24']

Steven C. O’Tool, Suite 555, 7401 Metro Boulevard, Edina, MN 55439 (for relator)
Loren A. Magsam, 33 Fourth Street Northwest, Osseo, MN 55369 (for respondent)
Relator Dealers Choice Auto Clean, Inc. seeks review by writ of certiorari of an administrative appeal hearing officer’s determination, alleging that (1) the hearing officer permitted significant irregularities in the proceedings by allowing an attorney to testify against Dealers Choice; (2) the determination that expenses for an air-uptake system (system) and a flammable waste trap (trap) were reestablishment costs was erroneous; and (3) the denial of some claims for location search was unsupported by the evidence. Because Dealers Choice failed to raise the claim that there was an attorney-client relationship between the testifying witness and Dealers Choice at the administrative appeal hearing and because the record supports the hearing officer’s determination that Dealers Choice failed to establish that the system and trap costs were moving costs and failed to adequately document the denied location-search claims, we affirm.
Respondent Osseo Economic Development Authority (OEDA) acquired Hans Auto site by condemnation and forced Dealers Choice,[1] a tenant at the site, to relocate. Pursuant to 49 C.F.R. § 24.205 (2000), OEDA was required to provide Dealers Choice with relocation advisory services. On December 9, 1999, Steven J. Thoreson, an attorney with Schnitker & Associates, first notified Dealers Choice by letter on firm letterhead that his firm had been retained to assist Dealers Choice “in preparing and documenting a claim for relocation benefits.” Thoreson sent specific written material outlining the procedures for making a claim for relocation benefits to Dealers Choice and requested information from Dealers Choice about their claim. Thoreson enlisted the assistance of a commercial property realtor to facilitate Dealers Choice in locating and acquiring a new location. All of Thoreson’s correspondence was on the law firm’s letterhead stationery.
On April 10, 2001, Thoreson informed Dealers Choice that he had reviewed the documentation supporting Dealers Choice’s relocation claim and was prepared to recommend to the City of Osseo that it pay Dealers Choice either a fixed payment of $20,000 or a payment of $13,620.75, the amount of allowed relocation expenses.
Thoreson concluded that the cost of installing the system and trap at Dealers Choice’s new site qualified as reestablishment expenses not moving expenses. The classification is significant because reimbursement for reestablishment costs is capped at $10,000 and there is no cap on reimbursement for moving expenses. 49 C.F.R. § 24.304 (2000). Classifying the system and trap costs as reestablishment expenses means that Dealers Choice will not be reimbursed for those expenses because other reestablishment costs exceeded the cap. Pursuant to 49 C.F.R. § 24.306 (2000), Dealers Choice is entitled to reimbursement for all allowed moving costs and for reestablishment costs up to $10,000, or, if that total is less than $20,000, Dealers Choice can elect to receive a fixed payment of $20,000.
Thoreson’s letter notified Dealers Choice that it could appeal his recommendation. Dealers Choice requested an administrative appeal and Thoreson arranged for a hearing before a hearing officer. Thoreson notified Dealers Choice that it could be represented by counsel at the hearing but Dealers Choice proceeded pro se. Thoreson testified at the hearing without objection.
The hearing officer issued a Determination of Appeal, finding, among other things, that the installation of the system and trap were reestablishment expenses and that Dealers Choice had only documented $540 in costs for time looking for a new location. The hearing officer allowed $3,620.75 in moving expenses and the cap of $10,000 for Dealers Choice’s $70,405.71 in reestablishment expenses. The hearing officer acknowledged that Dealers Choice may elect the fixed payment of $20,000 in lieu of the actual allowed reimbursement total of $13,620.75. Dealers Choice requested judicial review by writ of certiorari.
An appellate court’s review on a writ of certiorari “is limited to an inspection of the record * * * with respect to the merits, to determine whether [the hearing officer’s] decision was arbitrary, oppressive, unreasonable, fraudulent, or unsupported by evidence or applicable law.” Reierson v. City of Hibbing, 628 N.W.2d 201, 204 (Minn. App. 2001) (citation omitted); Senior v. City of Edina, 547 N.W.2d 411, 416 (Minn. App. 1996); In re Relocation Benefits of Wilkins Pontiac, Inc., 530 N.W.2d 571, 574 (Minn. App. 1995), review denied (Minn. June 23, 1995). “The reviewing court is not to retry the facts or make credibility determinations.” Senior, 547 N.W.2d at 416 (citation omitted). “The decision is to be upheld if the lower tribunal furnished any legal and substantial basis for the action taken.” Id. (quotation omitted).
1. Testimony by attorney Thoreson
Dealers Choice contends that (1) Thoreson’s testimony violated attorney-client privilege and his fiduciary duties to Dealers Choice and should not have been allowed by the hearing officer; (2) Thoreson’s testimony constituted significant irregularities in the proceedings causing undue prejudice to Dealers Choice; and (3) irregularities caused by Thoreson having issued a determination in opposition to, and having testified against, Dealers Choice deprived Dealers Choice of a fair hearing.
In order to prevail on these contentions, Dealers Choice must show that an attorney-client relationship existed between Thoreson and Dealers Choice. Yet, Dealers Choice failed to raise the issue of a possible attorney-client relationship between Thoreson and Dealers Choice at the administrative appeal hearing. Typically, on appeal, a reviewing court may not consider issues that were not considered or presented to the lower tribunal. Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988). Here, Dealers Choice did not object to Thoreson testifying, indicate any surprise that Thoreson was called to testify, or raise the claim of an attorney-client relationship between Thoreson and Dealers Choice. Dealers Choice did not give the hearing officer the opportunity to address potential problems with Thoreson’s testimony. On the record before him, we cannot conclude that the hearing officer had an independent duty to raise any questions about the propriety of Thoreson being called as a witness to testify about his recommendations.
Because Dealers Choice did not raise these issues at the hearing, we decline to address whether an attorney-client relationship existed between Thoreson and Dealers Choice and whether such a relationship caused irregularities in the proceeding.[2]
Dealers Choice contends that the hearing officer’s determination that the costs of the system and trap were reestablishment expenses was clearly erroneous. We disagree. Dealers Choice asks the court to review the hearing officer’s determination under the wrong standard of review. The hearing officer’s determination should be reviewed under an arbitrary and oppressive standard of review. See Reierson, 628 N.W.2d at 204.
The hearing officer determined that the system and trap constituted reestablishment expenses not moving expenses because there was no evidence that these items are machinery or equipment making their replacement (or cost of moving whichever is lower) reimbursable as a moving expense.
Displaced persons, such as Dealers,[3] may recover “moving and related expenses,” which include “[d]isconnecting, dismantling, removing, reassembling, and reinstalling relocated machinery, equipment, and other personal property including substitute personal property described at § 24.303(a)(12).” 49 C.F.R. § 24.303(a)(3) (2000). If the system and trap constitute machinery or equipment, then the expense of the system and trap is recoverable as a moving expense. But, if the system and trap do not constitute machinery or equipment, then the expense of the system and trap is recoverable as a reestablishment expense. Reestablishment expenses, capped at $10,000, include “[r]epairs or improvements to the replacement real property as required by * * * local law, code or ordinance.” 49 C.F.R. § 24.304(a)(1) (2000).
At the hearing, Thoreson testified that (1) the system and trap were installed to bring Dealers Choice’s replacement site to code and (2) the system and trap are not personal property. Loel Skar, acting on behalf of Dealers Choice, stated that the systems are permanent fixtures. David Bartel, also acting on behalf of Dealers Choice, indicated that the system installed at the relocation site was different from and more extensive than the system at the condemned site. Dealers Choice did not obtain any bids for moving the system or trap.
The evidence presented supports the hearing officer’s determination that Dealers Choice failed to establish that costs of installing the system and trap at the new location qualify as a moving expense and, therefore, his determination was not “arbitrary, oppressive, unreasonable, fraudulent, or unsupported by evidence or applicable law.” See Reierson, 628 N.W.2d at 204.
3. Replacement site search costs
Dealers Choice contends that the hearing officer clearly erred by determining that it was entitled to reimbursement for only 18 hours of 34 hours claimed for time spent searching for a replacement site. We disagree. Dealers Choice again is relying on the wrong standard of review. This court must examine whether the hearing officer’s determination was arbitrary and oppressive.
A displaced business shall be reimbursed for “actual expenses, not to exceed $1,000, as the Agency determines to be reasonable, which are incurred in searching for a replacement location.” 49 C.F.R. § 24.303(a)(13) (2000). Relocation expenses must be supported by adequate documentation “as may be reasonably required to support expenses incurred, such as bills, certified prices, appraisals, or other evidence of such expenses” and the “displaced person must be provided reasonable assistance necessary to complete and file any required claim for payment.” 49 C.F.R. § 24.207(a) (2000).
Thoreson testified that he provided Dealers Choice with a memorandum explaining how the search log and planning log should be written out so that he could recommend that the City pay search costs. Thoreson testified that his recommendation included for reimbursement the time Dealers Choice spent searching for a new location if he “could figure out who [was] doing the work, how much time they spent doing the work and if [he] could reasonably deduct what they were doing” including where they were looking for sites. The hearing officer determined that Thoreson’s criterion was consistent with 49 C.F.R. § 24.207(a). The hearing officer awarded Dealers Choice $540 because he determined that after reviewing the calendars submitted by Dealers Choice as evidence of search time, only 18 hours of search time was sufficiently documented.[4] Because the record supports the hearing officer’s determination, it was not arbitrary or oppressive.
4. Issues not briefed
Dealers Choice failed to brief the issues it purported to raise regarding reimbursement for locks and keys and insurance charges. We therefore decline to address these issues. See Abraham v. County of Hennepin, 622 N.W.2d 121, 128 n.1 (Minn. App. 2001) (declining to reach an issue that was not “fully briefed or argued by either party”), review granted (Minn. Mar. 13, 2001).
[1] Loel Skar and David Bartel are the principals of Dealers Choice.
[2] We feel compelled to caution attorneys who are acting in an advisory capacity other than in an attorney-client relationship to clearly identify the relationship to avoid confusion about the attorney’s role.
[3] Neither side disputes that Dealers is a displaced person.
[4] The hearing officer noted that Thoreson had left open the option of Dealers Choice providing additional documentation to support its location-search claims.