Source: http://law.justia.com/cases/minnesota/court-of-appeals/1998/1417-1.html
Timestamp: 2013-05-26 07:58:31
Document Index: 302668783

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Sharon Steinhofer Gertken, as parent and natural guardian of Shannon Barthel, Jessica Barthel, and Kristin Barthel, judgment creditor, Respondent, vs. Brian Barthel, et al., judgment debtors, and North Star Mutual Insurance Company, garnishee, Appellant. :: February, 1998 :: Minnesota Court of Appeals Decisions :: Minnesota Case Law :: US Case Law :: US Law :: Justia
Justia > US Law > US Case Law > Minnesota Case Law > Minnesota Court of Appeals Decisions > February, 1998 > Sharon Steinhofer Gertken, as parent and natural guardian of Shannon Barthel, Jessica Barthel, and Kristin Barthel, judgment creditor, Respondent, vs. Brian Barthel, et al., judgment debtors, and North Star Mutual Insurance Company, garnishee, Appellant.	NEW - Receive Justia's FREE Daily Newsletters of Opinion Summaries for the US Supreme Court, all US Federal Appellate Courts & the 50 US State Supreme Courts and Weekly Practice Area Opinion Summaries Newsletters. Subscribe Now
Sharon Steinhofer Gertken, as parent and natural guardian of Shannon Barthel, Jessica Barthel, and Kristin Barthel, judgment creditor, Respondent, vs. Brian Barthel, et al., judgment debtors, and North Star Mutual Insurance Company, garnishee, Appellant.
Dealers Choice Auto Clean, Inc., Relator, vs. City of Osseo Economic Development Authority, Respondent. C5-01-1417, Court of Appeals Unpublished, February 5, 2002.
C5-01-1417
Dealers Choice Auto Clean, Inc.,
City of Osseo Economic Development Authority,
C. O'Tool, Suite 555, 7401 Metro Boulevard, Edina, MN 55439 (for relator)
A. Magsam, 33 Fourth Street Northwest, Osseo, MN 55369 (for respondent)
and decided by Stoneburner,
Judge, and Halbrooks,
U B L I S H E D O P I N I O N
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. FACTS
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. D E C I S I O N
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]
2. Classification of system and trap
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.
site search costs
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
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). Affirmed.
[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.
side disputes that Dealers is a displaced person.
hearing officer noted that Thoreson had left open the option of Dealers Choice
providing additional documentation to support its location-search claims.