Neupauer Masonry, Inc.

Plain-English summary

An administrative law judge dismissed Neupauer Masonry's contest after the company failed to answer the Secretary's complaint or respond to an order to show cause. The default order affirmed three citations and $43,560 in proposed penalties. On review, Neupauer said it had hired Julio Vargas for legal advice and representation, forwarded the show cause order to him, and relied on his assurance that he would respond. The company later asserted that Vargas was not an attorney and was not licensed in Illinois. Because the judge did not have those facts when finding contumacious conduct, the Commission remanded for further factual development and possible reconsideration of the default.

Decision snapshot

• Cited standard(s): None identified in the decision
• Outcome: The default order affirming three citations and $43,560 in penalties was remanded for reconsideration.
• Key point: Although parties generally answer for their representatives, alleged reliance on someone who falsely claimed authority to practice law required further examination before default remained in place.

Full text (OSHRC public release)

NEUPAUER MASONRY, INC., Docket No. 12-1336

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No. 12-1336

NEUPAUER MASONRY, INC.,

Respondent.

APPEARANCES:

Barbara A. Goldberg, Attorney; Janet M. Graney, Acting Regional Solicitor; M. Patricia
Smith, Solicitor of Labor; U.S. Department of Labor, Washington, DC and Chicago, IL

For the Complainant

Andjelko Galic, Attorney; Chicago, IL

For the Respondent

REMAND ORDER

Before: ROGERS, Chairman and ATTWOOD, Commissioner.

BY THE COMMISSION:

At issue before the Commission is an Order of Default issued by Chief Administrative
Law Judge Covette Rooney dismissing the notice of contest filed by Neupauer Masonry, Inc.
(“Neupauer”), affirming the three citations issued to Neupauer, and assessing the total proposed
penalty of $43,560. For the following reasons, we remand this case for further proceedings
consistent with this opinion.

On September 19, 2012, the judge issued an Order to Show Cause, in which she gave
Neupauer—appearing pro se at the time—until October 1, 2012, to show why it should not be
held in default for failing to file a timely answer to the Secretary’s complaint. See Commission
Rule 34(b)(1), 29 C.F.R. § 2200.34(b)(1) (answer shall be filed within 20 days after service of
complaint). The judge sent the show cause order to Neupauer via certified mail, return receipt
requested, as required by Commission Rule 101(d), 29 C.F.R. § 2200.101(d). The return receipt
shows that the order was received by Neupauer on September 25, 2012.

On December 12, 2012, the judge dismissed Neupauer’s notice of contest based on its
failure to respond to the show cause order or otherwise communicate with her office citing
Commission Rule 101(a), 29 C.F.R. § 2200.101(a), which provides that a party “may be declared
to be in default . . . after having been afforded an opportunity to show cause why he should not
be declared to be in default . . . .” She found that Neupauer’s failure to respond constituted
contumacious conduct which prejudiced the Secretary by impeding her ability to proceed in the
matter.

In its petition for review, Neupauer—now represented by counsel—claims that it had
previously hired an individual named Julio Vargas to provide the company with legal advice and
representation in this matter.

According to Neupauer, it forwarded the judge’s show cause order
to Vargas, who assured the company that an appropriate response would be timely filed.
Neupauer argues that “[b]ut for the fact that [it] became a victim of the unauthorized practice of
law [by Vargas, it] would have answered the underlying complaint and would have participated
in this litigation contesting these very serious charges.”

The company’s petition also includes a
verification signed by its counsel asserting that Vargas is not an attorney and is not licensed in
Illinois.

Parties are generally bound by the actions of their hired representatives. Byrd Produce
Co., 16 BNA OSHC 1268, 1269, 1993-1995 CCH OSHD ¶ 30,139, p. 41,447 (No. 91-0823,
1993) (consolidated) . But the claims alleged by Neupauer in its petition raise serious issues
that the judge did not have before her when determining whether default was appropriate.
Indeed, it is not clear from the current record when Vargas was hired or whether he contributed
to Neupauer’s failure to file a timely answer and respond to the judge’s show cause order. And
while the judge found Neupauer’s conduct contumacious, the company now claims that its
behavior was due to its reliance on a representative who misrepresented his qualifications.

Under these circumstances, we find it appropriate to remand this case to the judge to
allow her an opportunity to fully consider Neupauer’s claims and take any further action as
appropriate including, if necessary, reconsideration of her default decision.

SO ORDERED.

/s/                                                         

Thomasina V. Rogers

Chairman

/s/                                                         

Cynthia L. Attwood

Dated: January 24, 2013                                             Commissioner

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No. 12-1336

NAUPAUER MASONRY, INC.

Respondent.

ORDER OF DEFAULT

On September 19, 2012 , the undersigned issued an Order to Show Cause (“Order”)
to Respondent. The Order directed Respondent to show cause on or before October 1,
2012 , as to why it should not be declared in default for not filing an answer to the
complaint within the time permitted by the Commission’s Rules of Procedure.
Respondent was advised that failure to respond to the Order would result in all of the
alleged violations set out in the OSHA citation being affirmed and the proposed penalties
being assessed without a hearing.

The Order was sent to Respondent, at its address of record, by first class certified
mail, return receipt requested. The green receipt card which accompanied the certified
mailing was returned to the Commission showing the signature “Neupauer” on it and
dated September 25, 2012. It is clear, therefore, that Respondent received the Order.
Despite this fact, Respondent has not responded to the Order and has not otherwise
communicated with my office.

Commission Rule 101(a), 29 C.F.R. § 2200.101(a), provides in relevant part that:

Sanctions . When any party has failed to plead or otherwise proceed as
provided by these rules or as required by the … Judge, he may be declared
to be in default … on the initiative of the … Judge, after having been
afforded an opportunity to show cause why he should not be declared to be
in default….Thereafter, the … Judge, in [her] discretion, may enter a
decision against the defaulting party….

A judge has very broad discretion in imposing sanctions for noncompliance with
the Commission’s Rules of Procedure or the judge’s orders. See Sealtite Corp. , 15 BNA
OSHC 1130, 1134 (No. 88-1431, 1991). The Commission, however, has long held that
dismissal is too harsh a sanction for failure to comply with certain prehearing orders
unless the record shows contumacious conduct by the noncomplying party, prejudice to
the opposing party, or a pattern of disregard for Commission proceedings. See
Architectural Glass & Metal Co. , 19 BNA OSHC 1546, 1547 (No. 00-389, 2001). I find
Respondent’s conduct here to be contumacious in that, as set out above, it clearly
received and signed for the mailing and yet failed to respond to the Order or otherwise
communicate with my office. I further find that Respondent’s conduct has caused
prejudice to the Secretary by impeding her ability to proceed in this matter. For these
reasons, Respondent is found to be in DEFAULT, its notice of contest is DISMISSED,
and the OSHA citation issued to Respondent on October 3, 2011 , Inspection Number
92350, is AFFIRMED in its entirety.

SO ORDERED.

/s/ Covette Rooney

Covette Rooney

Chief Judge

Dated: December 12, 2012

Washington, D.C.