March 27, 2009
NEW JERSEY DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT, PETITIONER-RESPONDENT,
R.I., INC. D/B/A SEATING SOLUTIONS, LISA SUPRINA, INDIVIDUALLY & AS PRESIDENT, SCOTT SUPRINA, INDIVIDUALLY & AS VICE PRESIDENT, AND TONY ENGLISH, INDIVIDUALLY & AS SECRETARY, RESPONDENTS-APPELLANTS.
On appeal from the New Jersey Department of Labor, Division of Workforce Development, CRI-608708-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 16, 2008
Before Judges Skillman, Collester and Graves.
Petitioner R.I., Inc., doing business as Seating Solutions, appeals from the September 19, 2006 final administrative action by the New Jersey Department of Labor & Workforce Development (Department) denying its application for renewal of its public works contract registration. We affirm.
Seating Solutions is a New York corporation engaged in the installation of spectator and audience seating in stadiums, auditoriums and similar structures including public works projects in New Jersey. The Department is authorized to administer and enforce the Public Works Contractor Registration Act (CRA), N.J.S.A. 34:11-56.48 to -56.57, and its associated regulations, N.J.A.C. 12:62-1.1 to -2.6. Under the Prevailing Wage Act (PWA), N.J.S.A. 34:11-56.25 to -56.70, of which the CRA is a part, contractors and subcontractors engaged in public work within the State are obliged to obtain a registration certificate from the Department. N.J.S.A. 34:11-56.51. This requirement was enacted to enforce laws and regulations concerning wages, unemployment, temporary disability and worker's compensation insurance and payment of payroll taxes.
N.J.S.A. 34:11-56.49. Under the CRA no contractor may bid or work on a contract for public work unless registered, and a violation of the Act is a disorderly persons offense. N.J.S.A. 34:11-56.56.
Applicants may obtain either a one or two-year registration certificate. One-year certificates are issued to new and one-year renewal applicants; two-year certificates are issued to contractors who have maintained at least two years of uninterrupted registration. The expiration date of the certificate is printed in its top right corner. Registrations must be renewed not less than thirty days before the expiration date of the immediate preceding registration. N.J.S.A. 34:11-56.54.
Seating Solutions first obtained a one-year registration in 2000, and subsequently obtained one-year registrations on an intermittent basis. On May 9, 2005, the company submitted an application for a two-year renewal of its registration certificate, which was denied by the Department because there had not been two years of uninterrupted registration. The Department refunded $200 of the application fee that was over and above the one-year renewal fee of $300 and issued a one-year registration certificate which noted that June 27, 2006, was the expiration date.
However, Seating Solutions failed to submit a renewal application prior to the expiration date printed on the 2005 certificate, causing its registration to lapse. Nonetheless, the company continued work on the Elizabeth High School Williams Field renovation public work project which began on May 31, 2006, and was scheduled to finish on October 13, 2006.
On August 18, 2006, two months after its prior registration expired, Seating Solutions submitted its application for a one-year renewal listing Lisa Suprina as president and Tony English as secretary as the persons with an interest in the company. Accompanying the application was a letter requesting that action be expedited because "(1) we did not receive any notification prior to the expiration date of 06/30/06 [and] (2) we are currently working on a contract in New Jersey." Follow-up letters were sent by the company on August 22 and August 26, 2006.
During this time Seating Solutions was involved in a disciplinary action brought by the Department for failure to pay workers in compliance with the PWA on three public works projects. On August 30, 2006, the Department suspended Seating Solutions and its principals from bidding or engaging in any public work projects pending debarment. By letter of September 1, 2006, the Department clarified that "the recent debarment sanctions imposed by the New Jersey Department of Labor and Workforce Development do not prevent Seating Solutions from completing public works already awarded or contractually obligated prior to the effective date of the debarment and suspension actions." Accordingly, Seating Solutions continued its work on the Williams Field project.
On October 13, 2006, the Department Commissioner ordered that Seating Solutions and its principals be debarred for a period of three years and pay the total amount of $47,965.88 as wages owed to employees, administrative fees and administrative penalties. On August 12, 2008, we affirmed the debarment in an unreported opinion, New Jersey Dep't of Labor & Workforce Dev. v. R.I., Inc., A-1713-06T3.
Acting on the company's 2006 application renewal, the Department issued a denial letter on September 19, 2006, on grounds that the company "engaged in a public work without a valid Public Works Contract or Registration certificate."
N.J.S.A. 34:11-56.51; N.J.A.C. 12:62-2.4(a)(2). The letter also cited N.J.A.C. 12:62-2.1(g), which states:
If the applicant knowingly supplies incomplete or inaccurate information to the department in connection with his or her application, he shall be disqualified under these rules, barred from reapplying for registration for a period of up to one year from the date of notice of disqualification and may be subject to other penalties described in N.J.A.C. 12:62-2.3, 2.4 and 2.5.
Despite the denial of its application on October 4, 2006, Seating Solutions began work on the Palmyra High School stadium public works project while unregistered. Following an informal conference on November 21, 2006, the Department confirmed its denial based on Seating Solutions' continued work on the Williams Field project after its registration had expired as well as the fact that the application submitted after the expiration date failed to identify a corporate officer, namely, Vice-President Scott Suprina. Seating Solutions requested a hearing, and the matter was transferred to the Office of Administrative Law (OAL).
At the hearing conducted on April 27, 2007, before an administrative law judge (ALJ), Department Assistant Director Robert Gaines testified that while it was standard policy to send pre-expiration notices to contractors, there was no statute or regulation requiring it. He added that copies of the notices were not kept in Department contractor files. Gaines said that when the Department was aware that the contractor was involved in a public work project with a lapsed registration certificate, a renewal registration was denied.
The ALJ issued a written decision on August 9, 2007, affirming the Department's denial of the application based on the following findings: Seating Solutions had pre-expiration notice since the expiration date was on the certificate itself; defendant engaged in a public work project while unregistered; and its untimely registration renewal application contained a material omission by failing to list Vice-President Scott Suprina in violation of the requirement that contractors provide the Department with the names and addresses of each individual with an interest in the company seeking registration. N.J.A.C. 12:62-2.1(c)(4), (8).
After exceptions were filed to the decision of the ALJ, the Commissioner issued his final administrative action on October 15, 2007, adopting the findings of the ALJ and upholding the initial decision of the ALJ to deny Seating Solutions a contractor registration certificate. This appeal followed.
Seating Solutions argues that the Commissioner's final administrative action should be reversed on grounds of fundamental fairness and equitable estoppel. It claims it received no notice of the expiration of its registration certificate and that it has been unjustly punished by the denial of a certificate because it voluntarily notified the Department that it was working on a public works project prior to and at the time of its renewal application. It further argues that there was no evidence that the omission of the name of Scott Suprina in the application was willful and not a simple oversight.
Our review of final agency administrative actions is limited. Mazza v. Bd. Of Trs., Police & Firemen's Ret. Sys., 143 N.J. 22, 25 (1995). In general, we may only inquire:
(1) whether the agency's action violates express or implied legislative policies, that is, did the agency follow the law;
(2) whether the record contains substantial evidence to support the findings on which the agency based its action; and
(3) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors. [Ibid.]
An agency decision requires reversal "only if it is arbitrary, capricious or unreasonable or it is not supported by substantial credible evidence in the record as a whole." Henry v. Rahway State Prison, 81 N.J. 571, 579-80 (1980). However, although agency action is granted a "strong presumption of reasonableness," Newark v. Natural Resource Council, 82 N.J. 530, 539, cert. denied, 449 U.S. 983, 101 S.Ct. 400, 66 L.Ed. 2d 245 (1980), a reviewing court is not bound by either an agency's statutory interpretation or strictly legal determination as these are judicial functions. Mayflower Securities Co. v. Bureau of Securities, 64 N.J. 85, 93 (1973).
We find no substance to the company's fundamental fairness argument. The Commissioner's finding that Seating Solutions had notice of the expiration date of their registration is based on substantial credible evidence and is neither arbitrary nor capricious. The one-year contractor registration certificate issued to the company plainly states on the face of the certificate that the expiration date was June 27, 2006. The Department acknowledged that it routinely issued advance notice of the expiration, but there is no statutory or regulatory obligation that it do so. Accordingly, although it is unclear whether Seating Solutions received a pre-expiration notification letter, the contention that it was required is incorrect. Positioning the expiration date on the face of the certificate was sufficient to place the company on notice of that date. Therefore, the contention that Seating Solutions' registration lapsed because of the Department's failure to provide pre-expiration notice has no merit.
Similarly, there is no merit to the argument that the Commissioner's decision was contrary to fundamental fairness. While there were instances where contractors were issued new certificates following a period of unregistered work, the uncontroverted testimony in the record was that the Department always denied applications when it was aware of such violations. The fact that Seating Solutions pointed out its ongoing work in its renewal application does not require the Commissioner to ignore or bend the applicable law set forth in N.J.S.A. 34:11-56.51, N.J.A.C. 12:62-2.1 and N.J.A.C. 12:62-2.4.
There is also no basis for the claim that the Department's September 1, 2006, letter permitting the company to continue work reasonably led to an expectation that the company's registration certificate would be renewed. The letter was dated six weeks after Seating Solutions began work on public projects in violation of the registration requirement. Moreover, the letter referred to continuation of the company's work following its debarment for violating the PWA and had nothing to do with its violation for performance while unregistered.
The company's estoppel argument is similarly misplaced. Equitable estoppel is rarely invoked against a government entity and only in cases of manifest injustice. Casamasino v. City of Jersey City, 158 N.J. 333, 364 (1999). Application of equitable estoppel in this case would require a showing that the Department engaged in conduct that induced reliance by Seating Solutions and caused it to act or change its position to its detriment, resulting in a manifest injustice. However, the Department made no misrepresentations on which Seating Solutions detrimentally relied, and no manifest injustice resulted from its denial of a registration certificate based on the applicable statutes and regulations.
Finally, the company argues that the omission of Scott Suprina's name on the list of individuals with an interest in the company was insufficient as a ground to deny renewal. We disagree. N.J.A.C. 12:62-2.1(g) states that a contractor may be disqualified from registration and barred for a period of one year "if the applicant knowingly supplies incomplete or inaccurate information to the Department in connection with [the] application." The application requires the applicant to certify that the provided information is "accurate, true and complete." Here, the record supports the conclusion that the absence of Scott Suprina's name was more than a simple oversight. Suprina was a corporate officer, a member of the company's Board of Directors and appeared on behalf of the company at federal and administrative proceedings dealing with violations of the PWA. Therefore, the Department's decision to deny Seating Solutions' application based in part on this omission is neither arbitrary nor capricious and is based on substantial credible evidence in the record.
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