IN THE CIRCUIT COURT OF THE FIRST CIRCUIT
STATE OF HAWAI'I
STATE OF HAWAI`I, UNIVERSITY OF ) CIVIL NO. 98-2810-06
HAWAI'I; and ROB WALLACE, )
) (Agency Appeal)
Appellants, )
)
vs. )
) ORDER AFFIRMING IN PART AND
WILLIAM D. HOSHIJO, Executive ) REVERSING IN PART FINAL
Director, on behalf of the ) DECISION OF HAWAI'I CIVIL RIGHTS
complaint filed by Eric White, ) COMMISSION
and the CIVIL RIGHTS COMMISSION, )
STATE OF HAWAI`I, )
)
Appellees. )
___________________________________)
ORDER AFFIRMING IN PART AND REVERSING IN PART FINAL DECISION OF
HAWAI'I CIVIL RIGHTS COMMISSION
On November 19, 1998, 9:45 a.m., oral argument on the above-
entitled case was held before the Honorable B. Eden Weil. Appellant
University of Hawaii, State of Hawaii, was represented by Deputy
Attorney General Russell A. Suzuki, Esq.; Appellant Rob Wallace was
represented by Jeffrey S. Portnoy, Esq.; and Appellees William D.
Hoshijo and the Hawaii Civil Rights Commission were represented by
John Ishihara, Esq. After reading the briefs, reviewing the record
on appeal, and hearing oral argument, the court makes the following
Findings of Fact and Conclusions of Law:
I. STANDARD OF REVIEW
The Court finds that there is an apparent conflict between the
standard in H.R.S. 368-16 (de novo review) for reviewing final
decisions of the Hawaii Civil Rights Commission ("Commission") and
the standard contained in H.R.S. 91-14(g) for reviewing agency
appeals. The Court does not believe that Steinberg v. Hoshijo, 88
Hawai`i 10, 960 P.2d 1218 (1998), expressly addresses the issue of
what standard should be used for reviewing a Commission final
decision. The Court believes that a specific statutory provision
governs the general and concludes that the appropriate standard
should be de novo review. However, for the purposes of appellate
review, the Court will decide this appeal under both de novo and
Section 91-14(g) standards.
Under de novo review, the Court will look at the evidence in
the record with a fresh eye and without relying upon any of the
presumptions regarding findings of fact and conclusions of law that
are used in a Section 91-14(g) review. In a de novo review, the
Court will not take additional evidence.
II. THE INCIDENT
Under de novo review and Section 91-14(g) review, the Court
finds that Eric White, his wife, and young child attended a UH
basketball game on February 18, 1995, at the U.H. Special Events
Arena. During the game, White, who was sitting near the team, made
comments about the coaching. The arena manager heard the comments
but did not ask White to quiet down because the comments, though
irritating, were not offensive.
Wallace, a team manager and son of the U.H. basketball coach,
sat on the bench about eight feet from White and heard his comments.
Wallace became irritated by White's comments about the coaching and
believed that they were attacks on his father. Near the end of the
game, Wallace turned to White and yelled, "Shut up you fucking
nigger! I'm tired of hearing your shit! Shut your mouth or I'll
kick your ass!" White replied, "Oh, yeah punk, come over and try
it! You see me all the time, what's the problem?" Wallace moved to
within a few feet of White and said, "Just shut up, nigger or I'll
kick your ass!" An assistant arena manager intervened to end the
encounter.
When White complained, the arena manager did not accept his
complaint. White was told to file a complaint with the police
department. White tried to file with the police department but was
ultimately refused because the incident was considered to be a civil
matter. Later White met with Wallace and Wallace's father and
mother to discuss the incident. No impartial U.H. officials were
present. After the meeting, no disciplinary action was taken
against Wallace although U.H. officials knew of his actions. A few
days later after White complained to the U.H. athletic director,
Wallace was suspended for his conduct. U.H. took no action to train
its personnel on how to prevent or handle discrimination complaints.
III. WALLACE'S STATUS AS EMPLOYEE OR AGENT
Under de novo review, the Court determines that Wallace was not
an employee. The indicia of employee status are not present under
the facts because Wallace received a scholarship and performed work
as a student manager in order to maintain the scholarship and his
position. Thus, under de novo review, the Conclusion of Law that he
was an employee is erroneous.
Under Section 91-14(g) review, the Court concludes that the
determination that Wallace was an employee is in error. To the
extent that it constitutes a Finding of Fact, the Court determines
that such fact is clearly erroneous and not supported by the
reliable, probative, and substantial evidence in the record.
Appellants conceded during oral argument, and the Court agrees
on de novo review, that Wallace was an agent of U.H. at the time of
the incident. The issue is whether the scope of his authority
included contact with spectators at games, such that Wallace was
acting within the scope of his authority when he yelled racial
insults at Eric White during the basketball game, thereby binding
the State, as his principal.
An agency relationship can be created by express or implied
contract or by operation of law. Thus, the existence of an agency
relationship may be implied by the conduct of the parties. The
Court determines that under a de novo review, U.H. expected that
Wallace would have contact with the public. Record at 1130-1215
(especially 1143, 1145, 1147-48), 1845, 1851-53, 1881, 1883-86,
1894-95, 1935-36 (Wallace's understanding of the scope of U.H.'s
expectations of him). U.H. gave Wallace an athletic scholarship for
working. Record at 1423-32, 1874-81. Wallace's behavior is
governed by the Student Athlete Handbook. Record at 1092-94, 1128-
1215, 1408-09, 1845, 1882-83, 1935-36. The Handbook has entries
governing interaction with spectators and recognizes that athletes,
including team managers, would be in the public eye. Record at
1143. It prohibits obscene and inappropriate language by athletes.
Record at 1145, 1147-48. It is undisputed and the Court finds as a
fact that U.H. suspended Wallace for his conduct toward Mr. White
because of his violation of the Handbook. Record at 1431-32, 1915-
18, 1932-34. The express language in the Handbook and the facts
under a de novo review demonstrate that it was anticipated that
during a U.H. basketball game, Wallace would have contact with the
public and that such contact would be within the scope of his
authority as an agent. Thus, the Court concludes that the incident
on February 18, 1995, was within the scope of Wallace's authority as
an agent.
Under Section 91-14(g) review, the Court finds that the facts
in the Final Decision are not clearly erroneous regarding Wallace's
status as agent and the scope of his authority. Thus, the
Commission's Conclusions of Law finding U.H. liable for Wallace's
conduct are not contrary to law.
IV. FIRST AMENDMENT
The Court's conclusion that Wallace was an agent acting within
the scope of his authority means that contrary to his claim Wallace
was not a private individual acting entirely in a private capacity,
but a public employee or agent for the purposes of First Amendment
analysis. The Court's use of the public employee standard does not
change its determination that Wallace was not an employee under
Hawaii law. Under de novo review, the First Amendment issues
analytically rest upon whether Wallace as a public agent was
speaking on a matter of public concern, such as, a political,
social, or other issue of community interest. Connick v. Meyers,
461 U.S. 138 (1983). The Court concludes that Wallace's use of the
word "nigger" did not involve a matter of public concern. Dambrot
v. Central Michigan University, 55 F.3d 1177 (6th Cir. 1995);
Wright v. Glynn Cty. Bd., 932 F.Supp. 1456 (S.D. Ga. 1996).
Therefore, the words spoken by Wallace to Eric White on February 18,
1995, were not entitled to First Amendment protection. Thus, as a
matter of law, the Commission's actions were not prohibited by the
First Amendment, and Wallace is liable for his conduct.
Under Section 91-14(g) review, the Court concludes that the
Final Decision was not in violation of the State or Federal
constitutions. The Court finds that the First Amendment in the
State Constitution is not analytically different from the Federal
Constitution. Thus, the Commission could hold Wallace liable for
his conduct despite the First Amendment.
V. SOVEREIGN IMMUNITY
U.H. claims that it is not liable because of sovereign immunity
for Wallace's conduct or for its failure to take immediate and
appropriate corrective action when Mr. White complained. Even
though the claim is brought under Chapter 489, U.H. contends that
Wallace's actions constituted an intentional tort under the State
Tort Liability Act, Chapter 662, and sovereign immunity has not been
waived for intentional torts.
Under de novo review, the Court concludes that Wallace did not
commit an intentional tort when he made racial insults to Eric
White. The Court finds that although Wallace intended to speak the
words he used, he did not speak them with the intent to discriminate
against Mr. White. The Court understands that choosing the words
and speaking them involve some intentionality. However in this
case, the record shows that Wallace negligently, not intentionally,
uttered the racial epithets at Mr. White. Record at 1932-33, 1898-
90 (Wallace's state of mind), and 1923-25, 1990-91 (spontaneity of
the utterance). Thus, there was no intentional tort committed by
Wallace, and sovereign immunity was waived.
Under Section 91-14(g) review, the Court concludes that the
reliable, probative, and substantial evidence in the record support
the Findings of Fact that Wallace's actions were not intentional.
The Court therefore finds that there is no error of law in
concluding that there was no intentional tort committed, to the
extent that such issue is dispositive of this appeal, and sovereign
immunity was waived. Although the Court concludes that Wallace did
not intend to discriminate for the purposes of addressing the
State's intentional tort sovereign immunity defense, it is in no way
condoning Wallace's unlawful conduct.
In the alternative, the Court concludes that even if Wallace's
conduct was intentional, neither the State Tort Liability Act
(H.R.S. Chapter 662), nor H.R.S. Chapter 661 regarding statutory
claims against the State preclude an award of money damages for
actions prohibited by law. Pursuant to H.R.S. 661-1(1), the State
has agreed to be sued for claims "founded upon any statute of the
State[.]" This constitutes a waiver of sovereign immunity for
statutory actions that can be brought against the State. Jacober v.
Sunn, 6 Haw. App. 160, 715 P.2d 813 (1986).
Chapter 489 is a statute which allows claims to against the
State. H.R.S. 489-1 provides that Chapter 489 shall be liberally
construed to carry out its purpose of preventing unlawful
discrimination in public accommodations. H.R.S. 489-3 prohibits
discriminatory practices which deny the full and equal enjoyment of
the goods, services, facilities, privileges, advantages, and
accommodations of a place of public accommodation, particularly
unfair discrimination because of race. H.R.S. 489-8 provides that
"[i]t shall be unlawful for a person to discriminate unfairly in
public accommodations." (Emphasis added.) H.R.S. 489-2 includes
the State within the definition of "person," and the State acts
through its employees or agents. Thus under H.R.S. 489-8, it is
unlawful for the State to discriminate unfairly in public
accommodations. Additional support is found in H.R.S. 489-2(6)
which lists as examples of "places of public accommodations" a
sports area and stadium, which are facilities normally operated by
the State, thereby indicating legislative intent to waive sovereign
immunity whenever the State operates such facilities.
H.R.S. 489-7.5, allowing suits by persons injured by an
unlawful discriminatory practice, when read in conjunction with the
enforcement provisions of Chapter 368 also support a conclusion that
sovereign immunity has been waived. It would eviscerate the ability
of the Civil Rights Commission to enforce Chapter 489 if the law is
read to disallow monetary damages and only limit the remedies to
injunctive relief, as urged by U.H. When discriminatory practices
under H.R.S. 489-3 are committed by a State employee or agent, it
would be inconsistent with the purpose of H.R.S. 489-1 to limit
the power of the Civil Rights Commission to grant only injunctive
relief. When the State violates essential constitutional and
statutory provisions against discriminatory conduct, it is not
appropriate for a court to narrowly construe the law especially when
Chapter 489 requires a liberal construction. Thus, the Court
concludes that the Legislature, by enacting Chapters 368 and 489
after Chapters 661 and 662, has effectively waived sovereign
immunity for actions taken on behalf of the State in violation of
H.R.S. 489-3.
U.H. in its Reply Brief and oral argument claimed that Act 115,
S.L.H. 1998, which grants autonomy to the University of Hawaii
carves out for U.H. a singular exception to the Court's analysis
regarding liability under Chapters 368 and 489. The Court finds the
argument unpersuasive. The Legislature did not intend to grant U.H.
autonomy to violate the State and Federal constitutions and laws
with impunity.
VI. CONCLUSION
Based upon the foregoing, the Court hereby affirms the Hawaii
Civil Rights Commission Final Decision and Order, with the exception
of the Conclusion of Law regarding Wallace's status as an employee
and reverses only that portion of the Final Decision and Order.
Under de novo review and Section 91-14(g) review, the Court adopts
the remaining Findings of Fact and Conclusions of Law in the
Commission Final Decision and Order which are consistent with the
Findings of Fact and Conclusions made by the Court in this Order.
DATED: Honolulu, Hawaii
JUDGE OF THE ABOVE ENTITLED COURT
APPROVED AS TO FORM:
JEFFREY S. PORTNOY, ESQ.
Attorney for Appellant Rob Wallace
RUSSELL A. SUZUKI, ESQ.
Attorney for Appellant State of
Hawai`i, University of Hawai`i
DEPARTMENT OF LABOR & INDUSTRIAL RELATIONS
HAWAI`I CIVIL RIGHTS COMMISSION
State of Hawai`i
830 Punchbowl Street, Room 411
Honolulu, Hawai`i 96813
Telephone: (808) 586-8657
JOHN ISHIHARA 1456-0
Attorney for Appellees William D. Hoshijo
and Hawaii Civil Rights Commission
IN THE CIRCUIT COURT OF THE FIRST CIRCUIT
STATE OF HAWAI'I
STATE OF HAWAI`I, UNIVERSITY OF ) CIVIL NO. 98-2810-06
HAWAII; and ROB WALLACE, )
) (Agency Appeal)
Appellants, )
) FINAL JUDGMENT
vs. )
)
WILLIAM D. HOSHIJO, Executive )
Director, on behalf of the )
complaint filed by Eric White, )
and the CIVIL RIGHTS COMMISSION, )
STATE OF HAWAI`I, )
)
Appellees. )
___________________________________)
FINAL JUDGMENT
Final Judgment is hereby entered based upon the Order Affirming
in Part and Reversing in Part Final Decision of Hawaii Civil Rights
Commission filed on February 24, 1999.
Final Judgment is granted in favor Appellee William D. Hoshijo,
Executive Director, on behalf of the complaint filed by Eric White,
and Appellee Civil Rights Commission, State of Hawai`i, against
Appellant State of Hawai`i, University of Hawai`i, and Appellant Rob
Wallace on all claims and issues raised by Appellants in their
Notices of Appeal and briefs, except that the determination that Rob
Wallace was an employee of the University of Hawai`i at the time of
the incident is reversed.
DATED: Honolulu, Hawaii
JUDGE OF THE ABOVE-ENTITLED COURT DEPARTMENT OF LABOR & INDUSTRIAL RELATIONS
HAWAI`I CIVIL RIGHTS COMMISSION
State of Hawai`i
830 Punchbowl Street, Room 411
Honolulu, Hawai`i 96813
Telephone: (808) 586-8657
JOHN ISHIHARA 1456-0
Attorney for Appellees William D. Hoshijo
and Hawaii Civil Rights Commission
IN THE CIRCUIT COURT OF THE FIRST CIRCUIT
STATE OF HAWAII
STATE OF HAWAI`I, UNIVERSITY OF ) CIVIL NO. 98-2810-06
HAWAII; and ROB WALLACE, )
) (Agency Appeal)
Appellants, )
) NOTICE OF ENTRY OF FINAL
vs. ) JUDGMENT
)
WILLIAM D. HOSHIJO, Executive )
Director, on behalf of the )
complaint filed by Eric White, )
and the CIVIL RIGHTS COMMISSION, )
STATE OF HAWAI`I, )
)
Appellees. )
___________________________________)
JUDGMENT
NOTICE OF ENTRY OF FINAL JUDGMENT
TO: RUSSELL A. SUZUKI, ESQ.
Deputy Attorney General
825 Queen Street
Honolulu, Hawaii 96813
Attorney for Appellant State of
Hawai`i, University of Hawai`i
JEFFREY S. PORTNOY, ESQ.
1000 Bishop Street
Suite 1200
Honolulu, Hawaii 96813
Attorney for Appellant Rob Wallace
NOTICE IS HEREBY GIVEN that a Final Judgment has been entered
in the above-entitled case on
in favor of Appellee William D. Hoshijo, Executive Director, on
behalf of the complaint filed by Eric White, and Appellee Hawaii
Civil Rights Commission against Appellant State of Hawai`i,
University of Hawai`i, and Appellant Rob Wallace on all claims and
issues raised by Appellants in the Notice of Appeal and briefs,
except that the determination that Rob Wallace was an employee of
the University of Hawai`i at the time of the incident is reversed.
Any and all claims not specifically identified have been dismissed.
DATED: Honolulu, Hawaii
CLERK OF THE ABOVE ENTITLED COURT
