Heave Ho Crane Company

Plain-English summary

An administrative law judge entered a default against Heave Ho Crane Company after the self-represented employer did not submit a position statement and responded to a show-cause order without an affidavit. The employer maintained that it believed the matter had already been settled or withdrawn. The Commission found that the timely response, the employer's explanation, and inconsistent communications about the case did not show contumacious conduct or a pattern of disregard for the proceedings. It also noted that Commission rules did not require the response to be in affidavit form. The Commission set aside the default, including the affirmed citation and $2,000 penalty, and remanded the case to determine its status and proceed accordingly.

Decision snapshot

• Cited standard(s): None identified in this procedural order.
• Outcome: Default order set aside and case remanded for further proceedings.
• Key point: Default was too harsh where a self-represented employer responded on time and the record did not establish contumacy or prejudice.

Full text (OSHRC public release)

HEAVE HO CRANE COMPANY, OSHRC Docket No. 14-0250

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United States of America

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

1120 20th Street, N.W., Ninth Floor

Washington, DC 20036-3457

SECRETARY OF LABOR,

Complainant,

v.

OSHRC Docket No. 14-0250

HEAVE HO CRANE COMPANY,

Respondent.

DIRECTION FOR REVIEW AND REMAND ORDER

Before: �
ROGERS, Chairman; ATTWOOD and M ac DOUGALL,
Commissioners.

BY THE COMMISSION:

����������� In
an order dated August 13, 2014, Administrative Law Judge John B. Gatto found
Respondent, appearing pro se, to be in default, and accordingly affirmed a one-item
serious citation with a total penalty of $2,000. � On September 2, 2014, Respondent filed a
petition seeking review of the judge�s default order. � For the following reasons, we direct this
case for review, set aside the judge�s decision, and remand this case for
further proceedings consistent with this opinion.

Procedural Background

����������� On
February 11, 2014, Respondent timely contested the citation, and the case was
designated for simplified proceedings pursuant to Commission Rule 203(a), 29
U.S.C. � 2200.203(a). � On April 11,
2014, the Secretary notified the judge by email that the parties �ha[d] settled
this matter.� � That same day, the judge
entered an order directing the parties to file the settlement for approval
within 30 days. � On May 23, 2014, the
Secretary sought an extension of time to file what he identified as a �Joint
Notice of Withdrawal of Citation and Complaint.� � According to the Secretary, Respondent was
sent this document for signature but subsequently �indicated that [the owner] may
have inadvertently thrown [it] away,� so the Secretary sent Respondent a second
copy. � The judge granted the Secretary�s
motion and directed the Secretary to file the Joint Notice by June 18,
2014. �

As of June 30, 2014, the
parties had yet to file the document, so the judge issued a scheduling order setting
the matter for hearing, and directing the parties to confer and discuss several
issues. [1] � He also ordered the parties to file �position
statements� by July 18, 2014, which the Secretary did, but Respondent did not. � In his response, the Secretary asserted that
�[o]n multiple occasions, representatives for the Secretary have attempted to
contact Respondent . . . and Respondent has refused to
discuss the matter and/or cooperate.� �
The Secretary also represented that while �[t]he parties had engaged in
settlement negotiations and reached a settlement in principle,� Respondent
�ha[d] repeatedly refused to execute the agreement.� �

On July 29, 2014, the
judge issued Respondent a show cause order in which he found, based on the
Secretary�s prior assertions, as well as the company�s failure to file its
position statement and confer with the Secretary as ordered, that �Respondent�s
conduct was contumacious conduct and established a pattern of disregard for
Commission proceedings.� � The judge directed
Respondent to show cause by August 12, 2014, in affidavit form, why it should not be declared to be in default for these
failures. � On August 12, 2014, Respondent
filed its response with the judge by facsimile. �
Respondent stated that the company should not be held in default because
�[t]he matter was settled on April 11, 2014.� �
Respondent also stated that:

By your order I was instructed to send this in affidavit form ,
however, my internet service is temporarily out of service. � Therefore I can not [sic] use my internet to
locate said form. � If after my service is
restored you still require this information to be placed in a different format
then I will resubmit it.

����������� The
judge issued his default order the next day. �
He found that Respondent did not submit its response in affidavit form,
nor had the response been served on the Secretary. � The judge concluded that �[e]ven if the Court
accepts Respondent�s unsworn statement, the Court finds the response to be
insufficient to overcome a default.� � The
judge accordingly dismissed Respondent�s notice of contest, affirmed the citation,
and assessed the $2,000 proposed penalty.

����������� In
its Petition for Discretionary Review, Respondent asserts that the parties had �mutually
settled� the matter, and it had �received written notification that all actions
by OSHA had been suspended [and] the matter closed, and specifically advising
[Respondent] that no further action on [its] part was required.� � While Respondent acknowledges that �[t]his
was followed by sporadic . . . communications indicating
that subsequent actions (form signatures, etc.) were required,� Respondent
maintains that �this stood in direct contravention to [the company] having been
advised that the matter was completely resolved and closed, [and therefore] no
further action was taken.� � Respondent also
challenges the judge�s reliance on its failure to respond to the show cause
order in affidavit form and reiterates the offer it made in its response to
resubmit its submission in any form the judge might require if it had time to
prepare. [2]

Discussion

Commission Rule 101(a), 29 C.F.R.
� 2200.101(a), permits the sanction of default for failure to plead or
otherwise proceed as required by the Commission�s rules or by the Commission or
judge. [3] � The Commission has held that a default
sanction may be appropriate �where a party displays a �pattern of disregard�
for Commission proceedings.� � Bilodeau Homes , 21 BNA OSHC 1292, 1293,
2004-09 CCH OSHD � 32,805, p. 52,531 (No. 05-0231, 2005) (citations
omitted); Samuel Filisko d/b/a Associated
Contractors Group , 20 BNA OSHC 2204, 2206, 2004-09 CCH OSHD � 32,855,
p. 52,963 (No. 04-1465, 2005); Architectural
Glass & Metal Co. , 19 BNA OSHC 1546, 1547, 2001 CCH OSHD � 32,424,
p. 49,975 (No. 00-0389, 2001). � As the
Commission has recognized, however, �dismissal of a citation is too harsh a
sanction for failure to comply with certain prehearing orders unless the record
shows contumacious conduct by the noncomplying party or prejudice to the
opposing party.� � Bilodeau , 21 BNA OSHC at 1293, 2004-09 CCH OSHD at p. 52,531; Samuel Filisko , 20 BNA OSHC at 2206,
2004-09 CCH OSHD at p. 52,963; Architectural
Glass & Metal Co. , 19 BNA OSHC at 1547, 2001 CCH OSHD at p. 49,975. � See
also Commission Rule 101(b), 29 C.F.R. � 2200.101(b) (a default
sanction may be set aside �[f]or reasons deemed sufficient by the Commission or
Judge�).

We
conclude that the shortcomings identified by the judge in his default order do
not support a finding of contumacy or a pattern of disregard for Commission
proceedings. � Respondent filed a response
to the show cause order within the time mandated by the judge, explaining its
previous inaction and offering to resubmit the response in a different format
if necessary. [4]
�� Because Respondent offered an
explanation in its timely response as to why the company thought no further
action on its part was required, we find no basis for contumacy. � See
Sealtite Corp. , 15 BNA OSHC 1130, 1133, 1991 CCH OSHD
� 29,398, p. 39,581 (No. 88-1431, 1991) (�[T]he Commission has attempted
to make allowances for pro se employers who have failed, through ignorance of
our rules and of legal procedures, to comply with its procedural
requirements. . . . [T]he ultimate sanction of dismissal
should be imposed on a party only when that party has been guilty of
contumacious conduct or the other party has been prejudiced in preparing or
presenting its case by the conduct of the noncomplying party.�) (citations
omitted). �

Moreover, i t appears from the record that both
parties believed they had reached resolution in this case, although no settlement
agreement or notice of withdrawal has been submitted to the judge. � The Secretary�s description of this document
as a �Joint Notice of Withdrawal of Citation and Complaint� is inconsistent
with other references throughout the record identifying the document as a
�settlement,� so we cannot be certain whether the nature or terms of the
document are appropriately labeled a settlement, a withdrawal of citation, or
both. � Indeed, a withdrawal would
presumably not require Respondent�s signature, nor would it require approval by
the judge. See Cuyahoga Valley Ry. Co.
v. United Transp. Union , 474 U.S. 3
(1985) (holding that Secretary�s discretion to withdraw citation is
unreviewable). � In this regard, Respondent
might have been confused by the communications
from the Secretary about the
case�s resolution , particularly an April 25, 2014 letter sent to the
company but with a salutation to the judge. [5] �

Under
these circumstances , we
find that the record lacks evidence sufficient to support a finding of
contumacy, and we therefore set aside the default order. � On remand, the judge is directed to determine
the status of the case and proceed accordingly. � We also alert Respondent that any failure to
respond, or to comply with the judge�s orders, could result in sanctions,
including a default order if such conduct amounts to a pattern of disregard for
Commission proceedings. � See Imageries , 15 BNA OSHC 1545, 1547,
1991-93 CCH OSHD � 29,639, p. 40,130 (No. 90-378, 1992) (while parties
appearing pro se may �require additional consideration of their
circumstances[,]� such litigants �are not exempt from following Commission
rules and procedures . . . .�).

SO ORDERED.

����������������������� ����������������������������������������������������������� /s/ ��������������������������������������������������������

��������������������������
�������������������������������������������������������� Thomasina
V. Rogers

����������������������������������������������������������������������������������� Chairman

����������������������������������������������������������������������������������� ������������������ /s/ ��������������������������������������������������������

Cynthia L. Attwood

����������������������������������������������������������������������������������� Commissioner

����������������������������������������������������������������������������������� /s/ ��������������������������������������������������������

����������������������������������������������������������������������������������� Heather
L. MacDougall

Dated: September 18, 2014 ��������������������������������������� Commissioner

� SEQ CHAPTER \h \r 1 UNITED STATES OF AMERICA

OCCUPATIONAL
SAFETY AND HEALTH REVIEW COMMISSION

THOMAS E. PEREZ, Secretary of Labor,
United States Department of Labor,

Complainant,

v.

������ OSHRC DOCKET No. � 14-0250

HEAVE HO CRANE COMPANY,

Respondent.

DEFAULT JUDGMENT

On
July 28, 2014, the Court issued a Show Cause Order to Respondent, which found
that based upon Respondent�s failure to file a position paper as previously
ordered by the Court, that Respondent was in default of the Court�s order and
further, that Respondent�s conduct was contumacious conduct and established a pattern of disregard
for Commission proceedings. Thus, the Court directed Respondent to show
cause on or before August 12, 2014, by filing with the Court and serving on the
Secretary in affidavit form a statement as to the reason(s) the
Respondent should not be declared to be in default for failing to confer and
discuss with the Secretary�s Counsel, and for failing to file a position paper
with this Court.

The Court�s Show Cause Order also
gave notice to Respondent that if it failed to timely file a response in affidavit form , Respondent would be held in default,
the notice of contest would be dismissed, all of the alleged violations set out in the OSHA citation
would be affirmed, and that the Secretary�s proposed penalties would be
assessed in full. Respondent did not file a
response in affidavit form as directed by the Court in its Show
Cause Order. Instead, on the date the response
in affidavit form was due, the Respondent filed by facsimile
transmission as statement, which was not served on the Secretary, that simply
stated that �On April 11, 2014 the Secretary�s Counsel notified the court by
email that the parties had settled the matter.�

As the Court noted in the Show Cause Order, the Respondent
was in default for failing to confer with the Secretary regarding the
submission of a settlement agreement, for failing to sign the settlement
agreement, and thereafter, failing to confer and discuss with the Secretary�s
Counsel regarding the filing of a joint position paper with this Court, which
the Court required as a result of Respondent�s refusal to sign the settlement
agreement or confer at all with the Secretary and the placement of the action
back on the trial calendar. Even if the Court accepts Respondent�s unsworn
statement, the Court finds the response to be insufficient to overcome a default.
Accordingly,

IT IS HEREBY ORDERED THAT Respondent is in default, Respondent�s notice of contest is
dismissed, all of the
alleged violations set out in the OSHA citation are affirmed, and the
Secretary�s proposed penalties are assessed in full.

SO ORDERED
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/s/ ���������������������������������������������������������

JOHN B. GATTO, Judge

����������� � U.S. Occupational Safety and

����������� � Health Review Commission

[1] A July 3, 2014 letter from the Secretary to the judge
memorializes �recent communications� with the judge�s staff, and �confirm[s]
that this matter . . . should be placed back on the active
docket and scheduled for a hearing . . . .� � The Secretary asserts that �the
representative for Respondent . . . has declined to sign
the necessary documents that would jointly be filed to achieve closure of this
case.�

[2]
Respondent
also argues that certain �court-served documents and communications� were not
received by it, but does not identify the documents. �

[3]
This rule, formerly Commission Rule 41(a), 29
C.F.R. � 2200.41(a), states:

�  2200.101
Failure to obey rules . � (a) Sanctions. When any party has failed to plead or
otherwise proceed as provided by these rules or as required by the Commission
or Judge, he 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, or on the motion of a party.
Thereafter, the Commission or Judge, in their discretion, may enter a decision
against the defaulting party or strike any pleading or document not filed in
accordance with these rules.

[4]
We note that Commission Rule 101(a) does not require a show cause response to be in
affidavit form, and we find no compelling reason to have required one in this
case. � Such a requirement seems to be at
odds with long-standing Commission practice of making reasonable procedural
accommodations for pro se parties, particularly when the matter has been
assigned�as this case was�to simplified
proceedings. � See, e.g., Sealtite Corp. , 15 BNA OSHC 1130, 1133, 1991 CCH
OSHD � 29,398, p. 39,581 (No. 88-1431, 1991) . � In addition, we note that contrary
to the judge�s finding, Respondent�s show cause response indicates that it was sent
by facsimile to the Secretary as well as the judge.

[5]
The record contains two cover letters addressed
to Respondent from the Secretary that purport to include the Joint Notice for
signature; both letters, but not the attachments, were copied to the
judge. � The first, dated April 25, 2014,
is addressed to Respondent, but its salutation states �Dear Judge Gatto[.]� � The second, dated April 30, 2014, has the
correct salutation.