| IN RE: CHERI'S PET GROOMING | ) | DOCKET NO. 89 5939 |
| ) | ||
| FIRM NO. 563,975-00 | ) | DECISION AND ORDER |
| ) |
- APPEARANCES
- Firm/Petitioner, Cheri's Pet Grooming, by
- Ralph G. Turco, P.S., Inc., per
- Ralph G. Turco and Kathleen S. Jordan
- Department of Labor and Industries, by
- The Attorney General, per
- Penny L. Allen, Assistant, and Shawn Ruth, Paralegal
This is an appeal filed by the employer on December 20, 1989 from Notice and Order of Assessment No. 77397 dated November 20, 1989, which assessed industrial insurance taxes due and owing in the amount of $5,071.08 for the period July 1, 1987 through June 30, 1989. Affirmed.
DECISION
Pursuant to RCW 51.52.104 and RCW 51.52.106, this matter is before the Board for review and decision on a timely Petition for Review filed by the employer to a Proposed Decision and Order issued on December 4, 1990 in which the Notice and Order of Assessment dated November 20, 1989 was affirmed.
This appeal focuses on the employer's refusal to respond to a Department request for employment records during the assessment period, based upon the employer's claim of the Fifth Amendment privilege against self-incrimination guaranteed by the United States Constitution and by Article I § 9 of the Washington State Constitution. [2]
Because the employer did not file a brief, it is not entirely clear what the Fifth Amendment claim is based on. During a number of proceedings, various statutes were identified -- RCW 51.16.140, 51.48.280, 51.48.270 and 51.48.103. Those provisions establish various gross misdemeanors and felonies in connection with an employer's activities. Presumably the employer is contending that disclosure of information to the Department as required by RCW 51.48.040 might subject it to criminal liability under one or more of these other statutory provisions.
The industrial appeals judge noted that the Board does not have the authority to determine the constitutionality of the law that it administers, and also noted that the firm had failed to submit any evidence to show that the assessment was incorrect. The industrial appeals judge therefore affirmed the Department order.
While we reach the same conclusion as our industrial appeals judge, i.e., that the Department order assessing industrial insurance taxes should be affirmed, we do so for somewhat different reasons. We believe the final sentence of RCW 51.48.040 is dispositive of this matter. That sentence provides that:
Any employer who fails to allow adequate inspection in accordance with the requirements of this section is subject to having its certificate of coverage revoked by order of the Department and is forever barred from questioning in any proceeding in front of the board of industrial insurance appeals or any court, the correctness of any assessment by the department based on any period for which such records have not been produced for inspection. [3]
The employer now finds itself in a "Catch-22" position. Because the employer denied the Department the opportunity to inspect its records and asserted the Fifth Amendment privilege against self-incrimination, the employer is now barred from offering evidence to defeat the assessment. The employer apparently believes it should be able to cloak itself in the protection afforded by the Fifth Amendment and still proceed to offer certain evidence to defeat the assessment. That is not the law of this state. In Annest v. Annest, 49 Wn.2d 62 (1956), the Washington Supreme Court stated that:
A witness who declines to answer a proper question upon the ground that it would tend to incriminate him, has not told the whole truth, which his oath as a witness requires. He will not be permitted to testify to part of the truth only. When a party claims the privilege of not answering a proper question, the court may dismiss his action or strike his testimony.
Annest v. Annest, at 64. See Self-Incrimination--Civil Action, Annot., 4 A.L.R.3d 545 (1965).
In the matter before us it is apparent that the employer had a choice. The employer could have provided the requested documentary evidence and contested the assessment, or the employer could choose to exercise the Fifth Amendment privilege against self-incrimination. But the employer cannot have it both ways. To allow the employer to claim the privilege against self-incrimination and then testify and present only that evidence which the employer finds agreeable, would, in the words of the Annest court, allow the employer to testify to only part of the truth. It appears to us that the Legislature's adoption of the language in RCW 51.48.040 which bars the employer from contesting the [4] assessment before this Board is in agreement with the case law in this state as set forth in Annest. Since the employer has failed to meet the requirement under the statute to provide the necessary documentary records to the Department, the employer is precluded from offering any evidence before this Board regarding the assessment.
FINDINGS OF FACT
1. On November 20, 1989 the Department of Labor
and Industries issued a Notice and Order of Assessment assessing industrial insurance taxes against Cheri's Pet Grooming for the period July 1, 1987 through June 30, 1989 in the amount of $5,071.08. On December 20, 1989 the firm submitted a notice of appeal to the Board of Industrial Insurance Appeals from the November 20, 1989 Notice and Order of Assessment. On January 19, 1990 the Board issued an order granting the appeal, assigned it Docket No. 89 5939 and directed that further proceedings be held on the issues raised in the appeal.
2. The Department issued a subpoena duces tecum on June 19, 1989, requesting that Cheri's Pet Grooming produce certain business documents and records for the audit period of July 1, 1987 through June 30, 1989. The subpoena was personally served on June 25, 1989. Cheri's Pet Grooming refused to provide any books, records or payroll to the Department of Labor and Industries for the period of July 1, 1987 through June 30, 1989, asserting a Fifth Amendment right against self-incrimination.
3. As a result of the firm's failure to provide the requested information, the Department conducted an estimated audit, and assessed industrial insurance taxes in the amount of $5,071.08.
CONCLUSIONS OF LAW
- The Board of Industrial Insurance Appeals has jurisdiction over the parties and the subject matter to this appeal. [5]
- Under RCW 51.48.040 the firm was required to submit its books, records and payroll to the Department for inspection. Because the firm refused to provide the requested information, the Department properly estimated premiums due under RCW 51.16.155. In addition, because the firm refused to provide the requested information, it is barred pursuant to RCW 51.48.040 from challenging the correctness of the assessment of industrial insurance taxes for the period of July 1, 1987 through June 30, 1989 before the Board of Industrial Insurance Appeals.
- The November 20, 1989 Notice and Order of Assessment No. 77397 assessing industrial insurance taxes due and owing in the amount of $5,071.08 for the period July 1, 1987 through June 30, 1989 is correct and is hereby affirmed.
It is so ORDERED.
Dated this 10th day of June, 1991.
BOARD OF INDUSTRIAL INSURANCE APPEALS
/s/
SARA T. HARMONChairperson
/s/
FRANK E. FENNERTY, JR.Member
/s/
PHILLIP T. BORKMember