[¶ 10.] The Commission held a formal hearing on March 22, 2017. Agent Snyder, Secretary Eliason, and Johnson each testified at the hearing. In addition to testimony, the Commission viewed a video-only recording of Johnsons alleged misconduct from September 19, 2016. The Commission also viewed video and audio recordings of Johnsons attempt to give $20 to Secretary Eliason after their January 5, 2017 meeting. The Commission concluded that Johnson violated two administrative regulations by placing a patrons chips in the tip box and by being untruthful in the subsequent investigation. Considering these infractions, Johnsons attempt to give $20 to Secretary Eliason, and a previous suspension of Johnsons gaming license, the Commission decided to revoke Johnsons gaming license and exclude him from all gaming establishments in South Dakota.
[¶ 11.] Johnson appealed the Commissions decision to the circuit court. On appeal, the courts review was confined to the administrative record. The court held that several of the Commissions factual findings are clearly erroneous, including the Commissions findings that the $20 in chips belonged to Haddad and that Johnson was dishonest during the investigation. The court also held that the sanction imposed by the Commission was an abuse of discretion.
[¶ 12.] The Commission now appeals to this Court, raising the following issues:
1. Whether the Commission erred by concluding Johnson acted dishonestly or fraudulently.
2. Whether the Commission erred by concluding Johnson failed to report an irregularity.
3. Whether the Commission abused its discretion by revoking Johnsons license and adding him to the exclusion list.
Standard of Review
[¶ 13.] The central issue in this appeal is the formal adjudication of a contested case by an administrative agency. Therefore, this appeal is governed by South Dakotas Administrative Procedures Act, SDCL chapter 1-26. When the circuit courts review is limited to the administrative record, on appeal this Court makes the same review of the administrative tribunals action as did the circuit court. Dakota Trailer Mfg., Inc. v. United Fire & Cas. Co. , 2015 S.D. 55, ¶ 11, 866 N.W.2d 545, 548 (quoting Peterson v. Evangelical Lutheran Good Samaritan Socy , 2012 S.D. 52, ¶ 13, 816 N.W.2d 843, 847 ). Questions of law are reviewed de novo. Id. Matters of reviewable discretion are reviewed for abuse. SDCL 1-26-36(6). The agencys factual findings are reviewed under the clearly erroneous standard. SDCL 1-26-36(5). The agencys decision may be affirmed or remanded but cannot be reversed or modified absent a showing of prejudice. SDCL 1-26-36.
Analysis and Decision
[¶ 14.] The ultimate question in this appeal is whether the Commission abused its discretion by revoking Johnsons gaming support license and placing him on the exclusion list. The Commission cited three reasons for its decision. First, the Commission found that the $20 in chips belonged to Haddad, that Johnson did not attempt to determine Haddads identity, and that consequently, Johnsons placing the $20 in chips in the tip box constituted dishonest or fraudulent conduct in violation of ARSD 20:18:09:02. Second, as a further violation of ARSD 20:18:09:02, the Commission found that Johnson was dishonest in statements he made during the investigation and hearing. And third, the Commission found that Johnson violated ARSD 20:18:33:11 and Tin Lizzies in-house policy by failing to report an irregularity to his immediate supervisor. The circuit court reversed the Commissions decision on each of these points.
[¶ 15.] 1. Whether the Commission erred by concluding Johnson acted dishonestly or fraudulently.
[¶ 16.] The Commission first determined that Johnson violated ARSD 20:18:09:02, which states: Any act, whether of the same or of a different character than specified in this article, that constitutes dishonesty or fraudulent conduct, whether arising within or without the pursuit of the license privilege, committed by a licensee is grounds for disciplinary action. The Commission found that the $20 in chips belonged to Haddad, that Johnson did not attempt to identify Haddad, and that consequently, Johnsons taking the chips and placing them in the tip box was dishonest or fraudulent. The circuit court rejected the Commissions finding as a factual matter, concluding there was [n]o evidence produced to show the money was not in fact left as a tip. The Commissions findings assume and presuppose it to be found money despite complete lack of evidence.
[¶ 17.] The circuit court did not review the Commissions factual findings under the correct standard. As noted above, the court was required to give great weight to the findings made and inferences drawn by [the Commission] on questions of fact. SDCL 1-26-36. The Commissions factual findings may be set aside only if they are [c]learly erroneous in light of the entire evidence in the record[.] SDCL 1-26-36(5). Thus, the question is whether a complete review of the evidence leaves the Court with a definite and firm conviction that [the Commission made] a mistake by finding that the $20 in chips belonged to Haddad. See Aguilar v. Aguilar , 2016 S.D. 20, ¶ 9, 877 N.W.2d 333, 336 (quoting Clough v. Nez , 2008 S.D. 125, ¶ 8, 759 N.W.2d 297, 301 ).
[¶ 18.] There is sufficient evidence in the administrative record to prevent the conclusion that the Commissions factual findings on this matter are clearly erroneous. It is undisputed that at the beginning of the September 19, 2016 encounter, Haddad owned the $20 in chips at issue. It is also undisputed that Haddad overtly exercised ownership of the chips by placing $19 in chips as wagers and a $1 chip as a tip. It is further undisputed that Johnson ultimately took the $20 in chips from the table and placed them in the tip box. This is prima facie evidence that supports the complaints allegations that Johnson took money belonging to a patron and placed it in the tip box. Consistent with Haddads apparent ownership of those chips, Johnson attempted (at least once) to return them to Haddad when he started to walk away from the table. Even after Haddad walked away, Johnson did not immediately place the chips in the tip box; rather, Johnson continued to treat the chips as the property of a recognized and identifiable patron by placing them aside and marking them as separate from the tables bank. It was only after all other players left the table that Johnson finally placed Haddads chips in the tip box. Johnsons earliest account of the September 19, 2016 incident also supports the conclusion that Haddad did not intend to leave $20 in chips as a tip-when interviewed by Agent Snyder on September 30, Johnson stated that he didnt know what [Haddad] wanted to do with the chips.
[¶ 19.] In contrast to the evidence that supports the Commissions factual findings, neither Johnson nor the circuit court have identified any evidence-aside from Johnsons own statements-that affirmatively supports the assertion that Haddad intended to leave his chips as a $20 tip. The only support for this view is Johnsons answer to the complaint, in which he affirmatively claimed that he thought the money was intended to be a tip. But as noted above, Johnsons answer contradicts his interview statement, in which he indicated he did not know what Haddad intended. His answer also contradicts his written statement, in which he indicated he merely assumed the chips were intended as a tip. Considering the evidence discussed above, Johnsons inconsistent version of the September 19, 2016 incident is not sufficient to create a definite and firm conviction that the Commission made a mistake.
[¶ 20.] In addition to finding that Johnson acted dishonestly or fraudulently in placing Haddads chips in the tip box, the Commission also found that Johnson was dishonest in statements he made during the investigation and hearing. Specifically, the Commission found that Johnsons claim that he repeatedly attempted-including yelling-to inform Haddad that the chips belonged to Haddad was dishonest. The Commission specifically found Johnsons testimony and claims on this point not credible. Even so, the circuit court held that because the video recording of September 19, 2016, does not include audio, there was no evidence presented to dispute Johnsons assertions.
[¶ 21.] Again, the circuit court failed to apply the appropriate standard of review. Because the Commission is the only tribunal involved in this case that has seen and heard Johnson testify, the court was required to give due regard to the Commissions credibility determinations. Foley v. State ex rel. S.D. Real Estate Commn , 1999 S.D. 101, ¶ 9, 598 N.W.2d 217, 220. And importantly, the record supports the Commissions credibility determination. As noted above, Johnsons account of the September 19, 2016 incident varied between his interview, his answer to the complaint, his written statement, and his hearing testimony. Johnsons first account mentioned notifying Haddad of the chips only once. But in his answer to the complaint, Johnson claimed he made two attempts to notify Haddad before Haddad left the table and that he then yelled to Haddad while Haddad was halfway across the room. Then in his written statement, Johnson claimed he made three attempts to notify Haddad-all made before Haddad left the table. Finally, at the hearing, Johnson denied yelling to Haddad. And as the Commission noted in its findings, the video recording of the incident does not give any visual indication to support Johnsons claims.
[¶ 22.] In light of the foregoing, the Commission did not err by concluding Johnson violated ARSD 20:18:09:02. A complete review of the record does not create a definite and firm conviction that the Commission erred in finding that Johnson placed chips belonging to a patron in the tip box. Nor does that review create a definite and firm conviction that the Commission erred in finding that Johnson was dishonest during the investigation and hearing. Therefore, the circuit court erred by disregarding the Commissions factual findings.
[¶ 23.] 2. Whether the Commission erred by concluding Johnson failed to report an irregularity.
[¶ 24.] The Commission also determined that Johnsons conduct on September 19, 2016, violated ARSD 20:18:33:11, which states:
If any irregularity occurs, the dealer shall notify the box person or pit supervisor, who shall direct the dealer to take the most appropriate action which the box person or supervisor believes to be fair and equitable, and shall observe such action being taken. The box person or pit supervisor, and not the dealer, must make all decisions concerning disputed play or the payment or collection of wagers.
The Commission contends that the disposition of Haddads $20 in chips concerns the payment or collection of wagers under ARSD 20:18:33:11. Because Johnson was functioning as the dealer, the Commission concludes that he was prohibited from making any decision concerning those wagers and that he was required to report the issue to a supervisor. The circuit court held as a matter of law that the Commission misinterpreted ARSD 20:18:33:11. Noting that on September 19, 2016, Johnson was acting as both dealer and pit supervisor, the court concluded that Johnson was not required to seek guidance from anyone else. In essence, while the Commission viewed Johnsons status as a dealer as overriding his status as the pit supervisor, the court viewed Johnsons status as a pit supervisor as overriding his status as a dealer.
[¶ 25.] We decline to address this issue. As noted above, the Commissions factual findings support its conclusion that Johnsons conduct on September 19, 2016, violated ARSD 20:18:09:02. Therefore, it is not necessary to determine whether that same conduct also violated ARSD 20:18:33:11.
[¶ 26.] 3. Whether the Commission abused its discretion by revoking Johnsons license and adding him to the exclusion list.
[¶ 27.] The final issue involves the sanction that the Commission imposed on Johnson. As noted above, during their January 5, 2017 meeting, Secretary Eliason offered Johnson a 30-day suspension to settle the matter. But after the March 22, 2017 hearing, the Commission ultimately revoked Johnsons gaming support license and excluded him from all gaming establishments in South Dakota. In the circuit courts view, [t]he only thing that changed during that time frame was that Johnson exercised his right to a hearing as allowed pursuant to the applicable statutes and procedures. Thus, the circuit court held that the sanction was an abuse of discretion as measured relative to Secretary Eliasons settlement offer rather than as an absolute measure.
[¶ 28.] The circuit courts reasoning misperceives the role of the executive secretary. The executive secretary makes recommendations to the Commission, but he is not a commissioner and so is not involved in the actual adjudication of a contested case. Secretary Eliasons offer to settle the complaint was analogous to the State offering a plea agreement to a criminal defendant. The Commission was no more required to adhere to the terms of Secretary Eliasons rejected settlement offer than a sentencing court is required to adhere to a rejected plea agreement.
[¶ 29.] The Legislature expressly gave the Commission power both to revoke gaming licenses, see SDCL 42-7B-11, and to create a list of persons to be excluded from all licensed gaming establishments, see SDCL 42-7B-61. In reaching its decision, the Commission considered both Johnsons dishonesty in taking chips that belonged to a patron and placing them in the tip box and his dishonesty in giving varying accounts of the September 19, 2016 incident. The Commission also considered its previous suspension of Johnsons gaming license. Finally, the Commission considered Johnsons attempt to give $20 to Secretary Eliason. The Commission-the agency specifically tasked by the Legislature with administering gaming in South Dakota-found that the totality of Johnsons conduct could create or enhance a risk of the fact or appearance of unsuitable, unfair or illegal practices and activities in the conduct of gaming. The Commission did not abuse its discretion.
Conclusion
[¶ 30.] The Commissions factual finding that Johnson took money belonging to a patron and placed it in the tip box is not clearly erroneous. Nor is the Commissions factual finding that Johnson was dishonest in the subsequent investigation clearly erroneous. The sanction imposed by the Commission was within its discretion.
[¶ 31.] We reverse the circuit courts decision and affirm the Commissions decision.
[¶ 32.] ZINTER, KERN, and JENSEN, Justices, and SEVERSON, Retired Justice, concur.
The circuit courts review is usually confined to the administrative record. SDCL 1-26-35. However, in cases of alleged irregularities in procedure before the agency, not shown in the record, proof thereon may be taken in the court. Id. A circuit courts factual findings and legal conclusions regarding such proof of irregularities would be entitled to the usual deference afforded a circuit court. SDCL 1-26-37. But this appeal does not involve SDCL 1-26-35.