IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
AUDREY MAE PETERSON,
No. 84709-1-I
Petitioner,
v. DIVISION ONE
STATE OF WASHINGTON, PUBLISHED OPINION DEPARTMENT OF SOCIAL AND
HEALTH SERVICES, ADULT
PROTECTIVE SERVICES,
Respondent.
HAZELRIGG, A.C.J. — Audrey Peterson appeals from a review decision and
final order that determined she financially exploited a vulnerable adult. Because
the review judge failed to give due regard to the administrative law judge’s ability
to observe the witnesses, an error of law, we reverse.
FACTS
Audrey Peterson has been a registered nurse since 2009 and has worked
in hospice care since 2013. In October 2019, Peterson was employed by
Catholic Health Initiatives Franciscan Palliative and Hospice (CHI) and was
responsible for assessing patients to determine hospice care eligibility. On
October 5, she evaluated a patient named Reagan 1 in Reagan’s home. Reagan,
her husband Dean, and her daughter Krystel Hathaway were present for the
assessment. As part of the intake process, Peterson asked to see all of
1 Only Reagan’s first name appears in this opinion to protect her identity. No. 84709-1-I/2
Reagan’s medications to document them and ensure there was at least a fiveday supply of each medication in the home since another nurse would not return
for a follow-up visit for five days. Hathaway asserted that while documenting
medications, Peterson opened a bottle of Reagan’s prescription pain medication,
poured some of the pills into her hand, and put them into her laptop bag.
Hathaway called CHI and reported the incident; CHI contacted Adult Protective
Services (APS), a program of the Department of Social and Health Services
(DSHS). APS made an initial finding that Peterson financially exploited a
vulnerable adult. Peterson exercised her right to challenge the finding by timely
requesting an administrative hearing.
The hearing largely consisted of a credibility battle between Peterson and
Hathaway. Both testified and participated in a visual demonstration of how the
parties were positioned during the purported incident in order for the
Administrative Law Judge (ALJ) David Dunlap to determine the vantage points of
those present. Peterson also reenacted her method of handling pill bottles to
conduct a count. Erin Bush, an investigator for the Nursing Care Quality
Assurance Commission (NCQAC), testified regarding her investigation of the
incident. Grace Brower, an APS investigator, testified about her own
investigation. In Peterson’s case in chief, she called Thomas Browning and
Katherine Thomas, who each detailed their positive experiences working with
Peterson. ALJ Dunlap admitted and considered several exhibits during the
hearing, including Brower’s investigation notes and outcome report, Reagan’s
admission profile, notes from CHI supervisor Deborah Hagopian regarding
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Hathaway’s report, Bush’s memo from her phone interview of Hathaway, the
incident report from the Lakewood Police Department, a copy of Reagan’s
prescription for oxycodone, 2 the NCQAC notification that there was not
substantial evidence of a violation to support any disciplinary action with regard
to Peterson’s nursing license, and Peterson’s medical records.
After the conclusion of the hearing, ALJ Dunlap issued an initial order that
found Peterson did not financially exploit Reagan and reversed the initial finding
by APS. DSHS petitioned for review with the Board of Appeals. The review
judge, Thomas Sturges, reversed Dunlap’s initial order and affirmed the
substantiated finding by APS. Peterson timely petitioned for judicial review in
Thurston County Superior Court. The petition was transferred to the Court of
Appeals Division Two, then to this division.
ANALYSIS
An individual may seek judicial review of an administrative decision under
the Administrative Procedure Act. Ch. 34.05 RCW. The party challenging the
agency action bears the burden to demonstrate the invalidity of the agency
action. RCW 34.05.570(1)(a). This court will grant relief from an agency
adjudicative order only if one or more of the bases set out in RCW 34.05.570(3)
apply. Here, Peterson contends that the statute or rule on which the order is
based violates the constitution, the agency erroneously interpreted or applied the
law, the order is not supported by substantial evidence, and the order is arbitrary
and capricious.
2 Oxycodone is an opioid prescribed for moderate to high pain relief. It is classified as a schedule II controlled substance.
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In an appeal from a substantiated finding of abuse of a vulnerable adult,
an ALJ issues an initial order, subject to review by a reviewing officer.
Crosswhite v. Dep’t of Soc. & Health Servs., 197 Wn. App. 539, 547, 389 P.3d
731 (2017). The reviewing judge generally “shall exercise all the decisionmaking power that the reviewing officer would have had to decide and enter the
final order had the reviewing officer presided over the hearing.” RCW
34.05.464(4). This court “review[s] the review judge’s final order, not the initial
order entered by the ALJ.” Crosswhite, 197 Wn. App. at 548.
I. Due Regard to ALJ’s Ability To Observe Witnesses
Peterson first asserts Review Judge Sturges erred as a matter of law
because he failed to give due regard to ALJ Dunlap’s opportunity to observe the
witnesses. Both RCW 34.05.464(4) and WAC XXX-XX-XXXX(1) require a
reviewing judge to “give due regard” to the ALJ’s ability to observe witnesses.
RCW 34.05.464(4) states, “In reviewing findings of fact by presiding officers, the
reviewing officers shall give due regard to the presiding officer’s opportunity to
observe the witnesses.” WAC XXX-XX-XXXX(1) requires that “[i]n reviewing
findings of fact, the review judge must give due regard to the ALJ’s opportunity to
observe witnesses.” The failure to give due regard to the ALJ’s findings informed
by their ability to observe witnesses is an error of law. Quilang v. Dep’t of Soc. &
Health Servs., 25 Wn. App. 2d 164, 174, 527 P.3d 73 (2022).
This court interprets statutes and regulations de novo. Yaron v. Conley,
17 Wn. App. 2d 815, 825, 488 P.3d 855 (2021). We apply the general rules of
statutory construction when interpreting regulations. Id. In interpreting a statute,
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we first look to the plain language of the statute and give meaning to each word.
Smith v. Dep’t of Lab. & Indus., 22 Wn. App. 2d 500, 506, 512 P.3d 566 (2022).
We construe statutes so that “‘no clause, sentence or word shall be superfluous,
void, or insignificant.’” HomeStreet, Inc. v. Dep’t of Rev., 166 Wn.2d 444, 452,
210 P.3d 297 (2009) (internal quotation marks omitted) (quoting Kasper v. City of
Edmonds, 69 Wn.2d 799, 804, 420 P.2d 346 (1966)). We “‘assume the
Legislature meant exactly what it said and apply the statute as written.’” Id.
(quoting Duke v. Boyd, 133 Wn.2d 80, 87, 942 P.2d 351 (1997)). Where a term
is not defined by statute or regulation, we may look to a dictionary definition.
Samish Indian Nation v. Dep’t of Licensing, 14 Wn. App. 2d 437, 442, 471 P.3d
261 (2020).
RCW 34.05.464(4) has not been amended since it was codified in 1988.
WAC XXX-XX-XXXX, in contrast, has been amended three times. As originally
promulgated, the regulation provided for a much narrower inspection by the
reviewing officer. It stated that review judges had the same decision-making
authority as the ALJ only in specific types of cases, which did not include APS
findings. Former WAC XXX-XX-XXXX(1) (2000). In these cases, the review judge
was required to “consider the ALJ’s opportunity to observe the witnesses.” Id. In
all other cases, the review judge only had authority to change the ALJ’s initial
order if there were irregularities such as an abuse of discretion or misconduct, if
the findings of fact were not supported by substantial evidence, if the ALJ erred
as a matter of law, if the order needed to be clarified, or if the ALJ failed to make
an essential finding of fact. Former WAC XXX-XX-XXXX(3) (2000). Despite
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several changes to the rule refining the scope of review, the core requirement to
“consider the ALJ’s opportunity to observe the witnesses” remained unchanged. 3
The current rule was overhauled in 2011, reiterating that reviewing judges had
“the same decision-making authority as the ALJ,” but providing for de novo
review of initial orders in all cases, rather than just in specific types of cases.
Wash. St. Reg. 11-04-074 (Mar. 3, 2011). However, the review judge’s
discretion was limited by the requirement that “the review judge must give due
regard to the ALJ’s opportunity to observe witnesses.” WAC XXX-XX-XXXX(1).
This reflects an election by DSHS to broaden the authority of a reviewing judge
but place a caveat on that authority. It further reflects an explicit choice by DSHS
that the review judge not merely “consider” the ALJ’s opportunity to observe the
witness testimony, but give it “due regard.” “‘When the legislature uses different
words in the same statute, we presume the legislature intends those words to
have different meanings.’” Ass’n of Wash. Spirits & Wine Distribs. v. Wash. State
Liquor Control Bd., 182 Wn.2d 342, 353, 340 P.3d 849 (2015) (quoting In re
Pers. Restraint of Dalluge, 162 Wn.2d 814, 820, 177 P.3d 675 (2008) (Sanders,
J., dissenting)).
Based on our rules of statutory interpretation, we must presume that
DSHS, in amending WAC XXX-XX-XXXX(1), meant something different when it
3 See former WAC XXX-XX-XXXX(1) (2000) (providing same decision-making authority in
cases related to licensing and related fines, rate-making, and parent address disclosure); see also former WAC XXX-XX-XXXX(1) (2002) (adding same decision-making authority in cases listed in former WAC XXX-XX-XXXX (2002) including, but not limited to, licensing of residential care and foster care homes, child protective services findings, and claims of good cause for failure to cooperate with the division of child support); see also former WAC XXX-XX-XXXX(2) (2008) (adding same decision-making authority to review of initial orders in cases involving medical assistance and social security eligibility, temporary assistance to needy families, working connections child care, and adoption support services).
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altered the requirement that the review judge “give due regard” to the ALJ’s
opportunity to observe witnesses rather than simply “consider” it. Consider is not
defined by regulation. The dictionary definition of “consider” includes “to reflect
on : think about with a degree of care or caution . . . to think of, regard, or treat in
an attentive, solicitous, or kindly way . . . REFLECT, DELIBERATE, PONDER.”
WEBSTER’S THIRD NEW INTERNATIONAL DICTIONARY 483 (2002). As such, DSHS
must have intended for “due regard” to mean something different from this
definition. We must additionally assume that DSHS and the legislature meant
what they said in requiring that a review judge “give due regard to the ALJ’s
opportunity to observe witnesses.” We give meaning to each of the words in the
regulation and statute, including due regard. See HomeStreet, 166 Wn.2d at
452. “Due regard” is not defined by statute or regulation. The dictionary
definition of “due” includes “owed or owing as a necessity,” “requisite or
appropriate in accordance with accepted notions of what is right, reasonable,
fitting, or necessary,” and “satisfying or capable of satisfying a need,
requirement, obligation, or duty.” W EBSTER’S THIRD NEW INTERNATIONAL
DICTIONARY 699 (2002). The definition of “regard” as a noun includes “attention
of the mind with a feeling of interest : attention or respect as shown in action or
conduct : CONSIDERATION, HEED, CONCERN.” WEBSTER’S THIRD NEW INTERNATIONAL
DICTIONARY 1911 (2002). Under the plain language of RCW 34.05.464(4) and
WAC XXX-XX-XXXX(1), the reviewing officer must give the requisite or appropriate
attention or respect to the ALJ’s ability to observe witnesses, as should be
illustrated by their action or conduct. The level of attention or respect given must
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be in accordance with accepted notions of what is right, reasonable, fitting, or
necessary. This plain language contemplates that the attention or respect given
will depend on the circumstances of the case and will be shown by the action or
conduct of the reviewing judge.
One way that a review judge may demonstrate they have given the
appropriate attention or respect to the ALJ’s ability to observe witnesses is by
providing an adequate explanation where the review judge disagrees with the
ALJ’s findings of fact. Division Three of this court has held that if the reviewing
officer departs from the ALJ’s findings of fact, they “‘must explain why.’”
Crosswhite, 197 Wn. App. at 561 (quoting ITT Cont’l Baking Co. v. Fed. Trade
Comm’n, 532 F.2d 207, 219 (2d Cir. 1976)). In addition to demonstrating that the
reviewing officer has considered the ALJ’s ability to observe witnesses, an
adequate explanation of the reviewing judge’s disagreement allows this court to
review the record and determine whether the findings are supported by
substantial evidence. See Int’l Bhd. of Teamsters, Loc. No. 310 v. Nat’l Lab.
Rels. Bd., 190 U.S. App. D.C. 279, 284, 587 F.2d 1176, 1181 (1978). 4 This is
particularly crucial where the review judge departs from findings “involving a
determination of whether a witness’s testimony as to an alleged fact is true.”
Quilang, 25 Wn. App. 2d at 179.
In Quilang, Division Three of this court held that where a reviewing judge
stated “that he ‘has given due regard to the ALJ’s opportunity to observe the
witnesses,’” but offered “no explanation why he has departed from the ALJ’s
4 While federal law is not binding upon this court, we may treat federal authority that interprets federal counterparts of state law as persuasive authority. Jensen v. Misner, 1 Wn. App. 2d 835, 843, 407 P.3d 1183 (2017).
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primary inferences,” the review judge erred as a matter of law. Id. Similarly, in
Crosswhite, the review judge erred when they “failed to explain why the ALJ’s
assessment of the witness’ testimony on this primary issue . . . should be
rejected, other than to make different, unsupported findings.” 197 Wn. App. at
567. We adopt the reasoning of Division Three in Crosswhite and Quilang and
agree that, to effectuate meaningful appellate review, an administrative reviewing
judge must explain their disagreement when they reverse an ALJ’s finding of fact.
Where a reviewing officer reverses an ALJ’s finding of fact, “‘we examine
the disagreement with a gimlet eye,’” conducting a “more ‘searching’” review.
Crosswhite, 197 Wn. App. at 560 (quoting Aggregate Indus. v. Nat’l Lab. Rels.
Bd., 423 U.S. App. D.C. 84, 89, 824 F.3d 1095, 1100 (2016); Plaza Auto Ctr.,
Inc. v. Nat’l Lab. Rels. Bd., 664 F.3d 286, 291 (9th Cir. 2011) (quoting United
Steel Workers of Am. AFL-CIO-CLC v. Nat’l Lab. Rels. Bd., 482 F.3d 1112, 1117
(9th Cir. 2007)). We examine the adequacy of the review judge’s explanation for
their disagreement to confirm that they have given appropriate respect to the
ALJ’s ability to observe witnesses. This is consistent with the general rule that
we review an error of law de novo. Envolve Pharmacy Sols., Inc. v. Dep’t of
Rev., 25 Wn. App. 2d 699, 710, 524 P.3d 1066 (2023). Further, the explanation
must be supported by substantial evidence in the record consistent with our
general requirement that an agency order be supported by substantial evidence,
such that a fair-minded person would be persuaded of the correctness of the
premise. Whitehall v. Emp’t Sec. Dep’t, 25 Wn. App. 2d 412, 421, 523 P.3d 835
(2023).
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Here, Review Judge Sturges asserted that he “ha[d] given due regard to
the ALJ’s opportunity to observe the witnesses” and explained that he reached a
different result because:
ALJ Dunlap failed to consider, weigh, and include all of the
documentary and testimonial evidence. The undersigned reviewer,
therefore, does not accept the credibility determinations made in
the Initial Order. In resolving the conflicting evidence, this reviewer
has considered and weighed all of the evidence, including the
witnesses’ demeanor[5] and the statements and motivations of the
testimonial witnesses and of the individuals whose comments are
reflected in the exhibits.
But this explanation is not adequate. Review Judge Sturges merely disagreed
with ALJ Dunlap’s analysis of the facts, finding contrary inferences from the
evidence. Sturges does not identify what evidence Dunlap failed to consider or
the impact of that additional evidence. Further, this finding is contradicted by ALJ
Dunlap’s express finding that he considered and weighed all of the evidence.
Review Judge Sturges also held that the initial findings of fact made by ALJ
Dunlap “were incomplete, inaccurate, and included Conclusions of Law,” but
does not explain what findings were lacking or inaccurate, nor how the findings
were inadequate. Rather, Sturges simply made contrary findings of fact based
on an opposite interpretation of the evidence presented.
5 It is unclear whether Sturges reviewed a video recording of the testimony or only a
transcript of the hearing. Sturges stated he viewed “the record of the hearing,” but also that he considered the witness’ demeanor. At oral argument before this court, counsel for DSHS asserted it “seems like [Sturges] had the ability to watch” the recorded testimony, but admitted this “was not certain” based on their knowledge of the record. Wash. Ct. of Appeals oral argument, Peterson v. Dep’t of Soc. & Health Servs., No. 84709-1 (July 12, 2023), at 9 min., 59 sec., video recording by TVW, Washington State’s Public Affairs Network,
https://tvw.org/video/division-1-court-of-appeals-2023071101.
No recordings of live testimony appear in the record before us, despite purported transmission of the entire agency record for purposes of this appeal. Because the record does not clearly demonstrate that Sturges viewed a recording of the actual testimony, we are unpersuaded by DSHS’s argument in this regard and decline to presume that Sturges examined anything more than the transcript contained in the record on appeal.
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For example, Sturges found Dunlap’s determination that Hathaway’s
testimony was less credible than Peterson’s was based on two details in
Hathaway’s story that changed over time, but Sturges reasoned “these
discrepancies were adequately explained by Ms. Hathaway during her
testimony,” and, as such, the “changing details were insufficient to cast doubt on
Ms. Hathaway’s testimony and failed to enhance the credibility of the Appellant’s
testimony.” Sturges also found that Peterson was less credible because she had
“a strong motivation to create a false narrative of what actually happened,” while
Dunlap expressly found Peterson’s testimony more credible despite her interest
in the proceeding because she cooperated with all investigations “and made an
admission against her own interest by discussing her own physical conditions
and prescriptions.” This finding by ALJ Dunlap is not discussed by Review Judge
Sturges.
Under RCW 34.05.464 and WAC XXX-XX-XXXX, Sturges was required to
show by action or conduct that he gave Dunlap’s ability to observe witnesses the
requisite or appropriate attention or respect in accordance with accepted notions
of what is right, reasonable, fitting, or necessary. The appropriate attention or
respect given needed to reflect the circumstances of the case, particularly the
reality that its essence was a credibility battle between Hathaway and Peterson.
This is especially true as Dunlap’s assessment of credibility included the unique
opportunity to view the witness testimony live, including a visual presentation by
the parties to determine the ability of each witness to observe Peterson’s conduct
and a demonstration by Peterson of how she picked up the bottle, removed and
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held the lid, and shook it to see how many pills were inside. Review Judge
Sturges’ general and largely unsupported explanation as to why he made
contrary findings is inadequate and does not reflect an appropriate level of
attention or respect given the circumstances of the case. As the reviewing
officer, Sturges certainly has authority to make such contrary findings, but there
must be a sufficient explanation in the record to support this disagreement such
that it reflects due regard given to Dunlap’s ability to observe witnesses. Sturges
erred as a matter of law and Peterson is entitled to relief under RCW
34.05.570(3)(d).
The dissent complains that by adopting Division Three’s “must explain”
requirement when a reviewing officer departs from an ALJ’s findings we are
embracing “a new and different legal standard found nowhere in the APA.” It
faults Division Three for relying on a federal case involving a federal trade
regulation that expressly contained language calling for the reviewing judge to
state the “reasons or basis for its action.” While it is true that ITT Continental
Baking Co. v. Federal Trade Commission, involves a regulation with express
language that requires reviewing judges to state their reasons for departing from
an ALJ’s finding, the dissent ignores the two cases cited in Crosswhite
immediately after ITT Continental. There Division Three also relied on General
Dynamics Corp. v. Occupational Safety & Health Review Commission, 599 F.2d
453 (1st Cir. 1979) and International Brotherhood. Crosswhite, 197 Wn. App. at
561. In each of these cases the court also imposed a requirement for an
explanation of its reasoning when a reviewing court departs from an ALJ
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determination. Gen. Dynamics, 599 F.2d at 463; Int’l Bhd., 190 U.S. App. D.C. at
284. And none of the regulations examined in these cases contained express
language that imposed such a requirement. The reasoning in both Crosswhite
and Quilang is sound and facilitates meaningful review. It is consistent with our
“substantial evidence” standard of review under the APA and with the plain
language of “due regard” under RCW 34.05.464(4) and WAC XXX-XX-XXXX(1).
Indeed, the dissent relies on the reviewing court’s explanation in reaching its
conclusion that the explanation is not adequate. According to the dissent, the
explanation “tells us what we need to know.”
Finally, the dissent contends that the APA confines us to only remand,
rather than reverse, an agency action. But, under the APA “a court reviewing
agency action has an array of options: ‘the court may (a) affirm the agency action
or (b) order an agency to take action required by law, order an agency to
exercise discretion required by law, set aside agency action, enjoin or stay the
agency action, remand the matter for further proceedings, or enter a declaratory
judgment order.’” Rios v. Dep’t of Lab. & Indus., 145 Wn.2d 483, 508, 39 P.3d
961, 974 (2002) (emphasis added) (quoting RCW 34.05.574(1)). While the
statutory preference is to “remand to the agency for modification of agency
action,” we need not do so when remand “is impracticable or would cause
unnecessary delay.” RCW 34.05.574(1). Here, the dissent agrees that the
reviewing judge did not provide an adequate basis to depart from the ALJ’s
credibility findings. Remand under these circumstances is neither practical nor
efficient. Further, the dissent’s analysis in this regard is belied by extensive case
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law in this state. See, e.g., Tapper v. Emp’t Sec. Dep’t, 122 Wn.2d 397, 402, 858
P.2d 494 (1993) (“The WAPA allows a reviewing court to reverse an
administrative decision when, inter alia: (1) the administrative decision is based
on an error of law.” (first emphasis added)); Nguyen v. Med. Quality Assur.
Comm’n, 144 Wn.2d 516, 534, 29 P.3d 689 (2001) (noting that the court’s
determination on a constitutional issue “requires reversal”); Ames v. Med. Quality
Assur. Comm’n, 166 Wn.2d 255, 260, 208 P.3d 549 (2009) (“Under the WAPA, a
reviewing court may reverse an administrative order (1) if it is based on an error
of law.” (emphasis added)); Dang v. Med. Quality Assur. Comm’n., 10 Wn. App.
2d 650, 664, 450 P.3d 1189 (2019) (“Under RCW 34.05.570(3), we will reverse
only if (1) the administrative decision is based on an error of law.” (emphasis
added)); Neravetla v. Dep’t of Health, 198 Wn. App. 647, 658, 394 P.3d 1028
(2017) (“We may reverse an administrative order (1) if it is based on an error of
law.” (emphasis added)); Netversant Wireless Sys. v. Dep’t of Lab. & Indus., 133
Wn. App. 813, 821-22, 138 P.3d 161 (2006) (reiterating that “we reverse an
administrative decision only if it (1) was based on an error of law” (emphasis
added)); Conway v. Dep’t of Soc. & Health Servs., 131 Wn. App. 406, 414, 120
P.3d 130 (2005) (“A reviewing court may reverse an administrative decision if: (1)
the agency has erroneously interpreted or applied the law.” (emphasis added));
Scheeler v. Emp’t Sec. Dep’t, 122 Wn. App. 484, 487-88, 93 P.3d 965 (2004) (“A
reviewing court may reverse an administrative decision when: ‘(1) the
administrative decision is based on an error of law.’” (emphasis added) (quoting
Tapper, 122 Wn.2d at 402)); Callecod v. Wash. State Patrol, 84 Wn. App. 663,
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670, 929 P.2d 510 (1997) (noting that “this court may reverse an administrative
decision only if (1) the administrative decision was based on an error of law”
(emphasis added)). 6 It is clear our remedy comports with well-settled
jurisprudence. Accordingly, we reverse and reinstate ALJ Dunlap’s Initial Order.
Peterson raises a number of additional assignments of error, contending
that ALJ Dunlap’s decision was arbitrary and capricious, that the order is
unsupported by substantial evidence, and that the relevant rule providing for a
preponderance of the evidence standard of proof violates the constitution.
However, because the first issue is dispositive, we need not reach these issues.
We reverse and reinstate the Initial Order. 7
I CONCUR:
6 We constrain our citations on this issue to only those cases dating from 1988 as that is
when the statute cited by the dissent was enacted.
7 Peterson seeks attorney fees on appeal under the Equal Access to Justice Act (EAJA).
LAWS OF 1995, ch. 403, § 901. The EAJA affords reasonable attorney fees unless the court finds that the action was substantially justified. RCW 4.84.350(1). For an action to be substantially justified, it must satisfy a reasonable person’s judgment. Silverstreak, Inc. v. Dep’t of Lab. & Indus., 159 Wn.2d 868, 892, 154 P.3d 891 (2007).
The APS/DSHS actions at issue here would satisfy a reasonable person’s judgment since its actions were taken in response to a complaint, and its investigation was required by statute. Furthermore, agencies “should not be chilled from investigating incidents in the future out of fear that [this court] will find its actions to be erroneous and award attorney fees.” Crosswhite, 197 Wn. App. at 570. We decline Peterson’s request for fees.
- 15 -Audrey Peterson v. DSHS, No. 84709-1-I
FELDMAN, J. — The majority opinion adopts a legal standard found
nowhere in the Washington Administrative Procedure Act (Washington APA), ch.
34.05 RCW, and reverses an administrative decision where the Washington APA
requires us to remand to the agency for further proceedings. I respectfully
dissent.
Part IV of the Washington APA governs adjudicative proceedings such as
those that occurred here. It first requires a “presiding officer” or “administrative
law judge” (ALJ) to conduct a hearing in which the parties may “present evidence
and argument, conduct cross-examination, and submit rebuttal evidence.” RCW
34.05.449(2). The ALJ then enters an “initial order,” which “shall include a
statement of findings and conclusions, and the reasons and basis therefor, on all
the material issues of fact, law, or discretion presented on the record . . . .” RCW
34.05.461(3). If a party seeks further review, as the Department of Social and
Health Services (DSHS) did here, the initial order is reviewed by a “reviewing
officer,” who issues a “final order” and may “exercise all the decision-making
power that the reviewing officer would have had to decide and enter the final
order had the reviewing officer presided over the hearing . . . .” RCW
34.05.464(4).
While reviewing officers have broad decision-making power, that power is
subject to an important limitation: “In reviewing findings of fact by presiding
officers, the reviewing officers shall give due regard to the presiding officer’s No. 84709-1-I/2
opportunity to observe the witnesses.” Id. Summarizing a reviewing officer’s
decision-making authority, the hearing rules that govern DSHS adjudicative
proceedings similarly state:
Review judges review initial orders and enter final orders. The
review judge has the same decision-making authority as the ALJ.
The review judge considers the entire record and decides the case
de novo (anew). In reviewing findings of fact, the review judge must
give due regard to the ALJ’s opportunity to observe witnesses.
WAC XXX-XX-XXXX(1). Thus, as both RCW 34.05.464(4) and WAC 388-02-0600(1) provide, a reviewing officer can disagree with an ALJ’s findings of fact—
as the reviewing officer did here—but in doing so must give “due regard” to the
ALJ’s opportunity to observe witnesses.
The threshold question here is what does “due regard” mean? As the
majority correctly notes, “due regard” is not defined by statute or regulation.
When a statute uses undefined terms, our Supreme Court has held that “we may
look to dictionary definitions.” Hanson v. Carmona, 1 Wn.3d 362, 374, 525 P.3d
940 (2023). Webster’s Third New International Dictionary defines “due” as “owed
or owing as a necessity,” “requisite or appropriate in accordance with accepted
notions of what is right, reasonable, fitting, or necessary,” and “satisfying or
capable of satisfying a need, requirement, obligation, or duty.” W EBSTER’S, supra
at 699. And it defines “regard” as “to pay attention to : notice or remark
particularly,” “to have care for : heed in conduct or practice : have respect for (as
a person) : show respect or consideration for,” and “to take into consideration or
account : take account of.” W EBSTER’S, supra at 1911. Properly interpreted, the
phrase “due regard” in RCW 34.05.464(4) and WAC XXX-XX-XXXX(1) requires a
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reviewing officer to show appropriate respect for an ALJ’s findings in accordance
with accepted notions of what is right, reasonable, fitting, and necessary.
Although the majority correctly recites the dictionary definitions of “due”
and “regard,” it ultimately embraces a new and different legal standard found
nowhere in the Washington APA. Expressly adopting Division Three’s reasoning
in Crosswhite v. Department of Social & Health Services, 197 Wn. App. 539, 389
P.3d 731 (2017), and Quilang v. Department of Social & Health Services, 25 Wn.
App. 2d 164, 527 P.3d 73 (2022), the majority holds “that a reviewing judge must
explain their disagreement when they reverse an ALJ’s finding of fact.”
(Emphasis added.) We are not bound by Division Three’s reasoning in
Crosswhite and Quilang (see In re Pers. Restraint of Arnold, 190 Wn.2d 136,
154, 410 P.3d 1133 (2018) (court of appeals divisions are not bound by opinions
of other divisions)), and there are compelling reasons to depart from Division
Three’s analysis.
Critical here, Division Three did not adopt a “must explain” requirement
based on the plain language of the Washington APA. Instead, Division Three
took the requirement from ITT Continental Baking Co. v. Federal Trade
Commission, 532 F.2d 207, 219 (2d Cir. 1976), which took the requirement from
Cinderella Career & Finishing Schools, Inc. v. Federal Trade Commission, 425
F.2d 583, 589 (D.C. Cir. 1970), which interprets a regulation that governs
proceedings before the Federal Trade Commission (FTC). In sharp contrast to
RCW 34.05.464(4) and WAC XXX-XX-XXXX(1), the FTC regulation at issue in
these federal cases stated as follows:
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In rendering its decision (on appeal or review), the Commission will
adopt, modify, or set aside the findings, conclusions, and rule or
order contained in the initial decision, and will include in the
decision a statement of the reasons or basis for its action. * * *
16 C.F.R. 3.54(b) (1969) (emphasis added). Thus, the reason that the federal
cases cited in Crosswhite and Quilang adopt a “must explain” requirement is that
the regulations that governed FTC proceedings required “a statement of the
reasons or basis” for the agency’s decision. There is no such requirement in
RCW 34.05.464(4) and WAC XXX-XX-XXXX(1).
While Washington courts can properly rely on federal case law when
interpreting the Washington APA, as Division Three did in Crosswhite and
Quilang, such reliance is expressly constrained by the statute. Addressing this
precise issue, the Washington APA states, “The legislature also intends that the
courts should interpret provisions of this chapter consistently with decisions of
other courts interpreting similar provisions of other states, the federal
government, and model acts.” RCW 34.05.001. Here, the federal decisions
cited in Crosswhite and Quilang did not interpret provisions similar to the “due
regard” requirement in RCW 34.05.464(4) and WAC XXX-XX-XXXX(1), so we
should not follow them when interpreting that statutory phrase. And because the
Washington APA does not include or even suggest a “must explain” requirement,
we should not adopt one here. See Cerrillo v. Esparza, 158 Wn.2d 194, 201,
142 P.3d 155 (2006) (“Courts may not read into a statute matters that are not in it
and may not create legislation under the guise of interpreting a statute.” (quoting
Kilian v. Atkinson, 147 Wn.2d 16, 21, 50 P.3d 638 (2002)). Instead, as noted
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previously, we should “look to dictionary definitions” to define the “due regard”
requirement as our Supreme Court has directed. Hanson, 1 Wn.3d at 374.
Applying the “due regard” requirement in the Washington APA rather than
the “must explain” requirement applicable to FTC proceedings, the next issue is
whether the reviewing officer here showed appropriate respect for the ALJ’s
findings in accordance with accepted notions of what is right, reasonable, fitting,
and necessary. Addressing the purported deficiencies in the ALJ’s analysis, the
reviewing officer stated:
ALJ Dunlap failed to consider, weigh, and include all of the
documentary and testimonial evidence. The undersigned reviewer,
therefore, does not accept the credibility determinations made in
the Initial Order. In resolving the conflicting evidence, this reviewer
has considered and weighed all of the evidence, including the
witnesses’ demeanor and the statements and motivations of the
testimonial witnesses and of the individuals whose comments are
reflected in the exhibits.
While the reviewing officer’s reasoning is not a model of clarity, it tells us what we
need to know: the reviewing officer concluded that the ALJ had failed to consider
all of the evidence and the reviewing officer reached a contrary conclusion based
on evidence that the ALJ had failed to consider.
To decipher the reviewing officer’s reasoning, we simply need to identify
documentary or testimonial evidence that is discussed or cited in the reviewing
officer’s final order and not discussed or cited in the ALJ’s initial order. When we
compare the two orders, we can easily see that the reviewing officer, unlike the
ALJ, quoted and relied heavily on statements made by an investigator for the
Nursing Care Quality Assurance Commission who reviewed Peterson’s pain
management plan and described her as a “functioning addict” and her
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prescribing health care provider as a “frequent flyer” for improper prescribing and
essentially a “dealer.” Based on these assertions, the reviewing officer
concluded that Peterson required “high doses of pain medication,” which “makes
it more likely that she took Reagan’s Oxycodone to supplement her own supply,”
and that “[t]his increased motivation to acquire Reagans’ [sic] Oxycodone makes
[Peterson’s] testimony that she didn’t take the medication, less credible.”
This explanation is ableist and, as such, is not an acceptable basis to
reject the ALJ’s credibility findings and reverse the ALJ’s initial order. Succinctly
stated, ableism “denies people with disabilities the right to be treated equally and
with dignity . . . .” Arlene S. Kanter, The ADA at Thirty: Its Limits and Potential,
71 Syracuse L. Rev. 621, 629 (2021). In the context presented here—that of
pain management through opioid use—this bias treats individuals who use
opioids to control pain as “undeserving addicts” rather than “deserving patients.”
Daniel Z. Buchman, Pamela Leece, Aaron Orkin, The Epidemic As Stigma: The
Bioethics of Opioids, 45 J.L. Med. & Ethics 614 (2017). We see this bias very
clearly in the reviewing officer’s unsupported conclusion that Peterson’s medical
need for Oxycodone to control her pain provides an “increased motivation” to
steal from others and makes her “testimony that she didn’t take the medication
. . . less credible.” The reviewing officer’s analysis treats Peterson as an
undeserving addict rather than a deserving patient.
Nor is there any evidence that Peterson’s use of opioids to control her
chronic pain makes her testimony that she didn’t take Reagan’s Oxycodone less
credible, as the reviewing officer concluded. Peterson testified before the ALJ
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that she currently uses opioids because she was struck in the face by a patient in
2010 and now suffers from chronic pain whenever she uses her jaw, which
includes “eating, talking, smiling, singing, crying, anything.” She also explained
that her opioid use is governed by “a pain contract with a medical provider,” that
she sees her medical provider once a month, that she is subject to random urine
drug screens, that she has not had problems obtaining sufficient medication to
control her pain, and that both her physical exams and random urine tests have
demonstrated “excellent adherence” to the prescribed use of opioid medication
and “no overuse.” There is no evidence in the record to conclude, as the
reviewing officer did, that Peterson’s prescribed opioid use makes her more likely
to steal Oxycodone and lie about it.
When the reviewing officer rejected the ALJ’s credibility findings and
reversed the ALJ’s initial order based on disability prejudice and ableism, he
failed to show appropriate respect for the ALJ’s findings in accordance with
accepted notions of what is right, reasonable, fitting, and necessary (the meaning
of “due regard”) as required by RCW 34.05.464(4) and WAC XXX-XX-XXXX(1).
Additionally, our Supreme Court has rightly held that “a verdict affected by racism
violates fundamental concepts of fairness and equal justice under law.”
Henderson v. Thompson, 200 Wn.2d 417, 421, 518 P.3d 1011 (2022). So, too,
does an administrative decision affected by ableism or any other discriminatory
-ism or -phobia. We must therefore grant relief from the agency order under the
Washington APA, which directs us to do so where, as here, “[t]he order . . . is in
violation of constitutional provisions on its face or as applied,” RCW
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34.05.570(3)(a), and “[t]he agency has erroneously interpreted or applied the
law,” RCW 34.05.570(3)(d). In granting relief from the agency order, the majority
relies on the latter provision; I believe both apply.
Having concluded that the reviewing officer failed to comply with the “due
regard” requirement in the Washington APA, the next issue before us is what
remedy is required in this circumstance? This issue is governed by RCW
34.05.574—appropriately titled “Type of relief”—which sets forth the type of relief
that a court can properly grant when reviewing an agency decision. The statute
provides in relevant part:
In reviewing matters within agency discretion, the court shall limit its
function to assuring that the agency has exercised its discretion in
accordance with law, and shall not itself undertake to exercise the
discretion that the legislature has placed in the agency. The court
shall remand to the agency for modification of agency action,
unless remand is impracticable or would cause unnecessary delay.
RCW 34.05.574(1). As the plain language of the statute makes clear, our
authority on judicial review is limited. We cannot reverse an agency
determination and must instead remand the matter to the agency to issue
a decision in accordance with law, including the “due regard” requirement
in RCW 34.05.464(4). While there are exceptions to this rule for exigency
and impracticality, neither exception applies here.
Courts applying RCW 34.05.574 have appropriately remanded
matters to the responsible agency as the statute requires. In Mills v.
Western Washington University, for example, Mills (a university professor)
argued that the agency decision-maker violated the Washington APA by
conducting a closed rather than an open meeting to determine whether he
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should be disciplined for allegedly abusive behavior. 150 Wn. App. 260,
276, 208 P.3d 13 (2009), rev’d, 170 Wn.2d 903, 246 P.3d 1254 (2011).
Addressing the proper remedy for this violation, this court stated:
Here, the closure of Mills’s disciplinary hearing was contrary to the
requirements of RCW 34.05.449(5) and, thus, constituted an
unlawful adjudicative procedure. Pursuant to RCW
34.05.570(3)(c), Mills is entitled to relief from the Board of Trustees’
Review Decision and Final Order. That order is vacated. Because
this court stands in the same position as the superior court and
there is no additional relief that the superior court may give, we
remand directly to the agency (i.e., the University) for a new
hearing.
150 Wn. App. at 279-80. Our opinion in Mills thus confirms that remand
for a new hearing is the proper remedy where, as in this case, an
administrative decision-maker fails to issue a decision in accordance with
the Washington APA’s requirements.
Several other courts have similarly so ruled. In Safeco Ins.
Companies v. Meyering, 102 Wn.2d 385, 395, 687 P.2d 195 (1984), our
Supreme Court directed the trial court to remand a matter to the
Commissioner of the Department of Employment Security for further
action consistent with its opinion because the Commissioner’s prior
decision was based on a incorrect interpretation of the law. In Boeing Co.
v. Gelman, the court concluded that the Board of Tax Appeals had failed
to issue a decision in accordance with law and directed the superior court
to enter an order stating, “This case is remanded to the Board of Tax
Appeals and the Board is instructed to comply with the procedural
requirements of WAC 456–09–925 through WAC 456–09–950.” 102 Wn.
App. 862, 872, 10 P.3d 475 (2000). And in Manke Lumber Co., Inc. v.
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Diehl, the court held that the superior court lacked authority under RCW
34.05.574(1) to reverse the agency’s substantive determination because
such a ruling “usurped the [Western Washington Growth Management
Hearings Board’s] role of determining [Growth Management Act (GMA)]
compliance.” 91 Wn. App. 793, 810, 959 P.2d 1173 (1998). Instead, the
proper remedy was to “vacate that portion of the Board’s order . . . finding
the County’s . . . designation not in compliance with the GMA, and remand
to the Board for further proceedings consistent with this opinion.” Id. The
court, in other words, rejected the remedy that the majority adopts here.
Lastly, a leading treatise on administrative law confirms the above
analysis. Addressing RCW 34.05.574(1), the treatise states:
The final sentence of RCW 34.05.574(1) deserves special
mention. It directs the reviewing court to remand the matter to the
agency for modification when the agency action is not being
affirmed by the court. The only exceptions are when remand is
impracticable or would cause unnecessary delay. This sentence
recognizes the proper division of authority between the
administrative agency and the court. The court acts as a check on
the agency’s action and does not act in place of the agency.
WASHINGTON ADMINISTRATIVE LAW PRACTICE MANUAL § 10.06[A] (2019). As
this treatise confirms, our role under the Washington APA is limited. While
we can properly remand a matter for further consideration where, as here,
the agency fails to issue a decision in accordance with law, we cannot—
and should not—usurp the agency’s role by deciding an issue that has
been delegated to an agency decision-maker.
In sum, I would vacate the reviewing officer’s final order and
remand the matter to the DSHS Board of Appeals to issue a decision in
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accordance with law, including the “due regard” requirement in RCW
34.05.464(4) and WAC XXX-XX-XXXX(1). I would also specify that the
matter be decided by a different reviewing officer because the previous
officer improperly prejudged the matter. See Henderson, 200 Wn.2d at
440 (“A case may be reassigned if ‘the trial judge will exercise discretion
on remand regarding the very issue that triggered the appeal and has
already been exposed to prohibited information, expressed an opinion on
the merits, or otherwise prejudged the issue’”) (quoting State v. McEnroe,
181 Wn.2d 375, 387, 333 P.3d 402 (2014)). Because the majority’s
remedy does not comport with these bedrock legal principles, I
respectfully dissent.
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