This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2000).
STATE OF MINNESOTA
IN COURT OF APPEALS
In the Matter of:
License Revocation of Vincent Peterson,
d/b/a Rangers Security.
Filed August 21, 2001
Department of Administrative Hearings
Dept. File No. 9240312839
Robert E. Lieske, Richard T. Franks, Wagner, Falconer & Judd, Ltd., 3500 IDS Center, 80 South Eighth Street, Minneapolis, MN 55402 (for relator)
Mike Hatch, Attorney General, Michael R. Pahl, Assistant Attorney General, 525 Park Street, Suite 500, St. Paul, MN 55103-2106 (for respondent Board of Private Detective and Protective Agent Services)
Considered and decided by Harten, Presiding Judge, Willis, Judge, and Parker, Judge.*
Relator challenges the revocation of his license by respondent Minnesota Board of Private Detective and Protective Agent Services. Because substantial evidence supports the revocation, we affirm.
In October 1998, relator Vincent Peterson, d/b/a Rangers Security, was licensed by respondent Minnesota Board of Private Detective and Protective Agent Services (the board). A year later, he was summoned to appear before the board’s complaint committee as a result of complaints about two Rangers employees.
Employee Millard Patrick, while on unarmed foot patrol duty for Rangers, had been found driving with a revoked license, illegally using flashing yellow lights to stop a vehicle, and illegally holding two persons at gunpoint with a BB gun. The other employee, Felix Pineda, had pled guilty to twice impersonating a police officer. The police department had revoked Pineda’s permit to carry a firearm, and relator had contacted the department to find out when Pineda could have his permit back. The department noted that relator appeared indifferent to the conviction, indicating that Pineda was his best employee.
Relator told the complaint committee that Patrick was still employed but on suspension for absenteeism, that Patrick drove to work although his license was revoked, that Patrick’s actions in driving while on duty (making a traffic stop of a car, and using a BB gun to detain people) were unauthorized by Rangers policies, and that Patrick had not been suspended or otherwise disciplined for these unauthorized activities. Regarding Pineda, relator said that Pineda was still employed and had not been disciplined for impersonating an officer and although relator recognized the complaint committee’s concern with relator’s having an armed employee who had been convicted of impersonating a police officer, relator did not believe the charges against Pineda. Relator also said that he knew his employees used police radio scanners but did not know that a permit was required to use them. Relator added that other employees were not told that Pineda’s and Patrick’s activities were unacceptable and had not been given any training pertinent to those activities; relator’s training of employees was limited to having them read the Rangers policy manual on their own.
Two months later, at the next meeting of the complaint committee, relator reported that Patrick and Pineda were no longer employed by Rangers. However, relator also revealed that (1) he had done nothing to train other employees in regard to unlawful activities; (2) he had begun quizzing new employees on the contents of the policy manual and that a typical question would be, “When is payday?”; (3) he failed to provide classroom teaching on Rangers policies; (4) his discipline policy was suspension or, for offenses such as not showing up for work or sleeping on the job, immediate termination; (5) he conducted no meetings of his entire staff but only meetings with individuals on the requirements of a particular job; (6) he had not reviewed state laws relevant to use of scanners, flashing lights, and detaining individuals; (7) his armed employees were armed for their own protection; and (8) he himself worked 24 hours a day, seven days a week, and had no second-in-command who could function as his deputy.
At the conclusion of the meeting, relator and his attorney were instructed to come back in a month to the next meeting and report relator’s progress in educating himself on the law, in providing training for his employees, in hiring a deputy for himself in case of emergencies, and in having background checks done on employees who had been with Rangers when relator acquired it. Relator was also asked to submit a written plan detailing how he would address the complaint committee’s concerns.
After relator failed to appear at the January 2000 meeting or to submit a written plan, the board sent him a letter telling him that the revocation of his license had been recommended. Relator’s attorney replied by mail saying, inaccurately, that relator had immediately suspended Patrick and Pineda upon learning of their offenses. The letter also said that (1) the attorney had reviewed the relevant law with relator; (2) relator had set up classroom training on equipment for his employees; (3) relator had hired a deputy; (4) relator had established a firearms training program; and (5) relator had initiated background checks on employees.
At the board’s February meeting, relator appeared with his newly hired deputy and his attorney. Relator admitted that no group training had yet occurred; he said he had met with some individual employees but he did not know who they were. He had not reviewed state laws and he had no training materials prepared. The deputy was a college student who had worked part-time as a security officer and bouncer. The board unanimously voted to revoke relator’s license.
The matter proceeded to a contested case hearing before an administrative law judge (ALJ). Following two days of hearings, the ALJ recommended sanctions against relator’s license. The board subsequently adopted the ALJ’s findings and revoked relator’s license. Relator challenges his license revocation, but for purposes of this appeal, agrees with the ALJ’s and the board’s factual findings.
D E C I S I ON
When an agency acts in a quasi-judicial capacity, an appellate court applies the substantial evidence test on review. In re Petition of Northern States Power Co., 416 N.W.2d 719, 723 (Minn. 1987).
The substantial evidence test requires a reviewing court to evaluate the evidence relied upon by the agency in view of the entire record as submitted. If an administrative agency engages in reasoned decisionmaking, the court will affirm, even though it may have reached a different conclusion had it been the factfinder.
Cable Communications Bd. v. Nor-West Cable Communications P’ship, 356 N.W.2d 658, 668-69 (Minn. 1984) (citations omitted). Because an administrative agency’s assessment of penalties is an exercise of its discretionary power, a reviewing court may not interfere with a penalty imposed by the agency absent a clear abuse of that discretion shown by the party opposing the decision. In re Henry Youth Hockey Ass’n, 511 N.W.2d 452, 456 (Minn. App. 1994), aff’d as modified, 559 N.W.2d 410 (Minn. 1994).
Minn. Stat. § 326.3311(5) (2000) provides that the board may revoke licenses for violations of Minn. Stat. §§ 326.32 – .339 (2000) or of the board’s rules. Relator claims that he did not violate any statutes or rules. He acknowledges that the primary reason for the revocation was his handling of the Pineda and Patrick matters but argues that he “should not be held responsible for the isolated action of just two of his employees.” However, Minn. Stat. § 326.336, subd. 1, provides that a license holder may employ unlicensed persons “provided that every license holder is at all times accountable for the good conduct of every person employed.” Therefore, relator, by statute, was responsible for the good conduct of his employees.
The evidence before the board showed that relator’s response to the serious misconduct of Pineda and Patrick was minimal: neither employee was disciplined for the misconduct until after relator had been instructed to do so by the complaint committee, and relator took no steps to ensure that other employees realized the gravity of the disciplined employees’ misconduct. In fact, relator’s own testimony reflected that he himself did not realize its gravity. When asked what misconduct would justify immediate disciplinary action, he mentioned tardiness or absenteeism or sleeping on the job, not illegal use of lights and weapons or impersonating a police officer. Accordingly, both the offending employees’ conduct and relator’s response to that conduct indicate relator’s failure to take responsibility for the conduct of his employees. These circumstances provide the substantial evidence required to uphold the revocation. See Cable Communications, 358 N.W.2d at 668 (substantial evidence is defined variously as more than a scintilla of evidence, more than some evidence, and more than any evidence).
Relator implies that the board erroneously revoked his license because of his failure to implement the instructions he received at the complaint committee meetings, not because he violated the law. But the board’s duties are to “enforce all laws and rules governing private detectives and protective agents,” Minn. Stat. § 326.3311(4); to “suspend or revoke the license of a license holder * * * for violations of any provision of sections 326.32 to 326.339 or the rules of the board,” Minn. Stat. § 326.3311(5); to “adopt rules * * * to govern the selection, training, conduct, discipline, and licensing of private detectives and protective agents,” Minn. Stat. § 326.3331; and to “prescribe the requirements, duration, contents, and standards for successful completion of certified training programs for license holders * * *,” Minn. Stat. § 326.3361, subd. 1. Thus, the board’s duty is to see that those licensed as protective agents are properly trained, knowledgeable of the rules governing themselves and their employees, and are following those rules.
Relator’s appearances before the complaint committee made it clear that he was unfamiliar with the rules and that his employees were not following them. At each of the complaint committee meetings, relator was told what the board wanted him to do and whom he could call if he had questions. When relator took no action initially and twice returned to the complaint committee without having implemented its directives on training and employee supervision, the board had substantial evidence supporting its decision to revoke his license.
Realtor also argues that the board was obligated to apply various other administrative sanctions before revocation. In making this argument, he relies on Minn. Stat. § 326.3388, providing that the board must establish a schedule of penalties and that the schedule must take into account the culpability, frequency, and severity of the violator’s actions. But contrary to relator’s argument, that statute does not require the board to impose lesser penalties before revoking a license. See also Minn. R. 7506.0170, subp. 2 (1999), providing that the board must consider the severity of the conduct in terms of its potential harm, the actual harm caused, the violator’s culpability, and the frequency of the violation. The board found that relator’s failure to accept responsibility for his employees’ serious misconduct (beyond acknowledging that it was not authorized) was severe, that realtor repeatedly and continually failed to train his employees in complying with the laws governing protective agents, and that relator focused primarily if not exclusively on generic employment items, e.g., asking employees “[w]hen is payday?,” to test their knowledge of the policy manual and citing tardiness and absenteeism as acts deserving immediate termination.
We conclude that substantial evidence supports the board’s decision to revoke relator’s license.
* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.