McQueary Industries, Inc.

Plain-English summary

An administrative law judge dismissed McQueary Industries' timely notice of contest after the company failed to answer the Secretary's complaint or respond to a show-cause order. That default affirmed several serious and other-than-serious citations with proposed penalties totaling $8,400. In its review petition, the company explained that the show-cause order did not reach the person handling the case, who was on extended leave, and said it wanted to revive a draft settlement that would reduce the penalty to $4,200. The Commission found the existing record insufficient to support dismissal because there was no evidence of prejudice, contumacious conduct, or a pattern of disregarding Commission rules. It set aside the default judgment and remanded for the judge to consider settlement if the parties remained willing.

Decision snapshot

• Cited standard(s): None identified in the decision.
• Outcome: The Commission set aside the default judgment and remanded the case for further proceedings, including possible settlement.
• Key point: A late filing alone does not justify dismissal without evidence of prejudice, contumacious conduct, or a pattern of disregarding Commission rules.

Full text (OSHRC public release)

McQueary Industries, Inc., Docket No. 08-1932

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No. 08-1932

MCQUEARY INDUSTRIES, INC.,

Respondent,

APPEARANCES:

Lindsay A. Wofford, Attorney; William E. Everhart, Regional Solicitor; Gregory F. Jacob,
Solicitor; U.S. Department of Labor, Washington, DC

For the Complainant

Mike McQueary; Fort Worth, TX

For the Respondent

REMAND ORDER

Before: ROGERS, Chairman; THOMPSON, Commissioner.

BY THE COMMISSION:

In an order dated May 19, 2009, Chief Administrative Law Judge Irving Sommer
dismissed a notice of contest (“NOC”), timely filed by McQueary Industries, Inc. (“McQueary”),
due to the company’s failure to file an answer or respond to a show-cause order issued by the
judge. In his dismissal order, the judge affirmed two citations alleging several serious and
other-than-serious violations of the Occupational Safety and Health Act of 1970, 29 U.S.C.
§§ 651-678, and assessed the total proposed penalty of $8,400. For the reasons that follow, we
set aside the dismissal order and remand this case to the judge.

Background

Following the issuance of the citations in this case, McQueary, appearing pro se , timely
filed a NOC and, on January 5, 2009, the Secretary filed a complaint. McQueary was required to
file an answer by January 28. Commission Rule 34(b)(1), 29 C.F.R. § 2200.34(b)(1). In early
February, after the time period for filing an answer had elapsed, the Secretary provided
McQueary’s owner with a draft settlement agreement and informed the judge of the proposed
settlement. There is nothing in the record, however, to indicate whether the parties ever
executed the draft agreement.

On April 1, the judge sua sponte issued an order directing McQueary to show cause, on
or before April 10, why its NOC should not be dismissed for failure to file an answer. A
certificate of receipt shows that, on April 6, a McQueary employee received the show-cause
order. On May 19, noting that McQueary had failed to respond to the show-cause order, the
judge entered a default judgment against McQueary and affirmed the citations. McQueary
timely filed a petition seeking review of the judge’s order.

In the petition, McQueary explains that, although the company received the show-cause
order via certified mail, it was addressed to the owner rather than the individual who was
responsible for “handling this issue” and further, that the individual responsible for handling this
issue was on extended leave. McQueary also states its desire to “reinstate the payment
arrangement” set forth in the draft settlement agreement. Attached to the petition is an unsigned
copy of the settlement agreement, which would have reduced the total penalty for all alleged
violations to $4,200, and required twelve monthly payments of $350, starting on April 15, 2009.

Discussion

We conclude the judge acted within his discretion by entering a default judgment against
McQueary after more than one month passed without McQueary responding to the show-cause
order. Commission Rule 101(a), 29 C.F.R. § 2200.101(a) (stating that a party failing to “proceed
as provided by [Commission] rules or as required by the Commission or Judge . . . may be
declared to be in default either on the initiative of the Commission or Judge, after having been
afforded an opportunity to show cause why he should not be declared to be in default . . .”).
Through its petition, filed pro se , McQueary has now provided a reason for its failure to respond
to the show-cause order and has expressed its desire to settle the case. Under these
circumstances, we conclude the present record lacks sufficient evidence to support the sanction
of dismissal. Samuel Filisko , 20 BNA OSHC 2204, 2206, 2005 CCH OSHD ¶ 32,855, p. 52,963
(No. 04-1465, 2005) (“[L]ate filing alone without evidence of prejudice, contumacious conduct
and/or a pattern of disregard for Commission rules would not be a basis for dismissing this
case.”).

Accordingly, we set aside the default judgment and remand the case to the judge.
Commission Rule 101(b), 29 C.F.R. § 2200.101(b) (sanction may be set aside “[f]or reasons
deemed sufficient” by the Commission). On remand, if the judge finds that there is no evidence
of contumacy, pattern of disregard, or prejudice to the Secretary, he should determine whether
the parties are still willing to enter into a settlement agreement. Id . If settlement is desired, the
judge should then provide the parties an opportunity to reach such an agreement. Commission
Rule 100(a), 29 C.F.R. § 2200.100(a) (“Settlement is permitted and encouraged by the
Commission at any stage of the proceedings.”).

SO ORDERED.

/s/____

Thomasina V. Rogers

Chairman

Dated: July 8, 2009                                                      /s/____

Horace A. Thompson III

Commissioner

Secretary of Labor,

Complainant,

V.

OSHRC Docket No. 08-1932

McQueary Industries, Inc.

Respondent.

ORDER

On 4/1/09 the undersigned issued an ORDER TO SHOW CAUSE to the
Respondent as to why his Notice of Contest should not be dismissed for failure to file an
answer to the complaint as required by the Commission Rules of Procedure. The
Respondent failed to reply to the ORDER. His actions demonstrate either that he has
abandoned the case or treats the Rules of Procedure of the Commission with disdain. This
cannot be countenanced as it seriously impedes the administration of justice.

Accordingly, the Notice of Contest filed by the Respondent is dismissed. The
Secretary’s citation(s) and proposed penalties are AFFIRMED in all respects.

/s/

Irving Sommer

Chief Judge

DATE:     29 May 2009