Petition — Calhoun v. Bailar

Office -Supreme ues U.S.

: a FILE

SO-1784 |:

' APR 24 1981

ee an, ALEXANDER L. STEVAS,

CLERK

In the Supreme Court of the

United States —

October Term ,1981

No.

JAMES L. CALHOUN,

Petitioner,

VS.

BENJAMIN L. BAILAR, Postmaster General

of the United States, et al.,

Respondents. |

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

HOWARD MOORE, JR.

The London Building

160 Franklin Street

Oakland, California 94607

Attorney for Petitioner

April, 1981

QUESTIONS PRESENTED

Did the Court of Appeals improperly extend the

decision of this Court in Richardson v. Perales (1971)

389 U.S. 402, to permit hearsay evidence offered

through ex parte affidavits of non-expert witnesses

to whom bias could be ascribed to be received in

evidence to sustain the removal of a federal employ-

ee from the Federal Service and thereby deprive the

petitioner of due process of law in violation of the

Fifth Amendment, United States Constitution?

Petitioner contends that the Court of Appeals'

holding directly conflicts with the decision of

this Court in Richardson v. Perales, supra, and that

it extends that decision to a factually different

and inappropriate context.

PARTIES

JAMES L. CALHOUN, Petitioner

BENJAMIN F. BAILAR, PostMaster General

of the United States; JOSEPH P. MORRIS,

Regional PostMaster General, Western

Region; ALAN J. CAMPBELL, Chairman,

United States Civil Service Commission;

Appeals Review Board; DONALD B. HOFFMAN,

Regional Director, United States Civil

Service Commission, Western Region; LIM

P. LEE, San Francisco Section Center,

PostMaster, Respondents.

INDEX

Questions Presented ....

Ro et a a

Statutory Provisions Involved...

Statement of the Case. .

Statement of the Facts

A. Background

B. The Administrative Hearing and

the Decision of the Federal

Appeals, Authority (FEAA) ...

C. Decision of the Appeals Review

MOGGG 6 «4 4s aw ee

D. Proceedings in the District Court .

E. Proceedings in the Court of Appeals

Reasons for Granting The Writ

THE DECISION OF THE COURT BELOW RAISES

AN IMPORTANT QUESTION CONCERNING THE

PROBATIVE EFFECT TO BE ACCORDED HEARSAY

EVIDENCE FROM NON-EXPERT WITNESSES IN

ADMINISTRATIVE PROCEEDINGS WHICH WAS

NOT DECIDED IN RICHARDSON v. PERALES

(1971) 402 U.S. 389, AND THE DECISION

BELOW IS EVEN IN DIRECT CONFLICT WITH

THIS COURT'S DECISION IN RICHARDSON v.

Temes OWNER, « 6 te et ell

ee he Ser ee Oe ees ee ee

EM at Te ee ke a 6 a ee re

-ii-

’ TABLE OF AUTHORITIES

Cases:

Arnett v. Kennedy (1974)

416 U.S. 134

Barenblatt v. United States

360 U.S. 109

Consolidated Edison Co. v. NLRB.

Goldberg v. Kelly (1970)

oer 08. aoe ,

Henley v. United States (M.D.Pa, 1974)

379 F.Supp. 1044 . ae ea vee

McKee v. United States

500 F.2d 525, 528

Murphy v. Waterfront Com'n (1964)

378 U.S. 52 shell Pad NEP

NLRB v. Bausch & Lomb, Inc. (C.A.2, 1975)

526 F.2d 817, 822 ea Tee

NLRB v. Payless Chashway Lumber Store

(C.A.8, 1974) 508 F.2d 24, 27-28 .

Ong v. Tovey (C.A.9, 1977)

252 F.2d 305 . ;

Richardson v. Perales (1971)

402 U.S. 389 ee

Wilkinson v. United States (1961)

365 U.S. 399 . ny eer ae

Willapoint Oysters Inc. v. Ewing

(9th Cir. 1949) 174 F.2d 676, 691

-1ii-

23,24

25,26

passim

Statutes:

> U.S.C. 701

> U.S.C. 706

28 U.S.C. 2201 and 1361

28 U.S.C. 1254(1)

Other Authorities:

Davis, Administrative Law Treatise

Federal Personnel Manual (FPM)

Pub.L. 89-554, Sept. 6, 1966

80 Stat. 393 . —

Rule 52(a) F.R.C.P.

Rule 56 F.R.C.P.

-iv-

16

12

No. 80-

In The

SUPREME COURT OF THE UNITED STATES

October Term, 1980

JAMES P. CALHOUN,

Petitioner,

Vv.

BENJAMIN F. BAILAR, PostMaster

General of the United States, et al.

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

SSS SSSSSS5S5S>SSSSS5S 52555525 2>== sss SSS

The petitioner, JAMES P. CALHOUN, respectfully

prays that a writ of certiorari issue to review the

judgment and opinion of the United States Court of

Appeals for the Ninth Circuit, entered in this pro-

ceedings on August 27, 1980. The opinion of the

Court of Appeals is reported at 626 F.2d 145 and is

set out in the Appendix hereto at la. The order of

the Court of Appeals denying the petition for

o'De

rehearing was entered on January 6, 1981, is as yet

unreported and is set out in the Appendix hereto at

a. The order of the District Court, entered Feb-

ruary 28, 1978, granting respondents' motion for

summary judgment and denying petitioner's motion

for summary judgment is as yet unreported and is

set out in the Appendix hereto at 20a.

JURISDICTION

The judgment of the Court of Appeals was entered

on January 6, 1981. On March 30, 1981, Mr. Justice

Rehnquist granted petitioner's motion for an exten-

sion of time in which this petition for writ of

certiorari could be filed through and to include

April 24, 1981. Jurisdiction of this Court is in-

voked under 28 United States Code, Section 1254(1).

STATUTORY PROVISIONS INVOLVED

Section 706, 5 United States Code, provides, in

pertinent part:

To the extent necessary to decision and when

presented, the reviewing court shall decide all

relevant questions of law, interpret constitu-

tional and statutory provisions, and determine

the meaning or applicability of the terms of an

agency action. The reviewing court shall--

a%e

(1) compel agency action unlawfully withheld

or unreasonably delayed; and

(2) hold unlawful and set aside agency action,

findings, and conclusions found to be--

(A) arbitrary, capricious, an abuse of dis-

cretion, or otherwise not in accordance

with law;

(B) contrary to constitutional right, power,

privilege, or immunity;

(C) in excess of statutory jurisdiction,

authority, or limitations, or short of

statutory right;

(D) without observance of procedure re-

quired by law;

(E) unsupported by substantial evidence in

a case subject to sections 556 and 557 of

this title or otherwise reviewed on the

record of an agency hearing provided by

Statute; or,

(F) unwarranted by the facts to the extent

that the facts are subject to trial de

novo by the reviewing court.

In making the foregoing determinations, the court

shall review the whole record or those parts of

it cited by a party, and due account shall be

taken of the rule of prejudicial error.

Pub.L. 89-554, Sept. 6, 1966, 80 Stat. 393.

STATEMENT OF THE CASE

This case reaches this Court through an appeal

from the United States District Court for the North-

ern District of California to the United States

abn

Court of Appeals for the Ninth Circuit. The appeal

was taken by notice of appeal filed on March 8, 1978.

(R. 105). The appeal was from the final order and

judgment granting the respondents' motion for sun-

mary judgment and denying the petitioner's motion

for summary judgment. (R. 104).

On July 4, 1977, the petitioner commenced an ac-

tion pursuant to various Titles of the United States

Code (5 United States Code, §§ 701 and 706, and 28

United States Code, §§ 2201 and 1361), to review a

final decision of the United States Civil Service

Commission, Appeals and Review Board, rendered on

July 25, 1975, to affirm the decision of the Civil

Service Commission, San Francisco Field Office, San

Francisco Section Center, sustaining an order to

dismiss petitioner as Acting Superintendent, Tour

II, United States Post Office, San Francisco, Cal-

ifornia, Rincon Annex Facility. (R. 1-6).

On December 22, 1977, the respondents filed

their motion pursuant to Rule 56, Federal Rules of

Civil Procedure. (Docket entries, Item 14).

On January 30, 1978, the petitioner filed his

motion for summary judgment, also pursuant to Rule

56. (R. 40).

oSa

On February 10, 1978, the respective motions for

Summary judgment as well as petitioner's motion to

compel discovery were heard in the District Court.

(Docket entry 29). Following the hearing, the Dis-

trict Court Judge announced his intended decision to

grant respondents’ motion for summary judgment and

denying petitioner's motion for Summary judgment.

(Ibid.).

On February 28, 1970, a final order and judgment

was entered granting and denying the respective mo-

tions for summary judgment. (R. 103-04).

On August 27, 1980, the Court of Appeals entered

its decision to affirm the judgment. The Court of

Appeals held that "hearsay evidence admitted without

objection or later motion to strike may constitute

substantial evidence in like manner as any other

evidence." (Appendix at 12a.) On September 10, 1980,

petitioner filed a timely petition for rehearing in

which petitioner contended that the decision of the

Court of Appeals was in direct conflict with the

controlling decision of this Court in Richardson v.

Perales (1971) 402 U.S. 389. on September 19, 1980,

the Court of Appeals directed the respondents to

reply to the petition for rehearing, and, on

ato

January 6, 1981, the Court of Appeals issued its

order denying the petition for rehearing. (Appen-

dix at l6a.)

STATEMENT OF FACTS

A. Background

Petitioner was discharged from his position as

Acting Tour II Superintendent at Rincon Annex of

the San Francisco, California Post Office, effec-

tive July 8, 1974. The basis of petitioner's dis-

charge rested primarily on the allegation that while

acting in his official capacity as Acting Tour II

Superintendent at the Rincon Annex he issued in-

Structions and/or caused the falsification of Postal

Source Data System (PSDS)/Work Load Recording System

(WLRS) mail volume records. Specifically, it was

alleged that petitioner had directed Clerks William

W. Gaffey, William A. Scroggins and Carol Whitley

to falsify PSDS/WLRS mail volume records and that

petitioner promised Clerk Scroggins unlimited over-

time for doing so, and promised Clerk Gaffey higher

level pay and Quality Step Increases for his coopera-

tion. Pursuant to an appeal submitted to the U.S.

Civil Service Commission, San Francisco Field Office

- &

in petitioner's behalf by his then counsel, Clarence

Wilridge, Esquire, an administrative hearing was

held before Assistant Appeals Officer David L.

Biggers on September 12 and 13 of 1974.

B. The Administrative Hearing and the De-

cision of the Federal Employee Appeals

Authority (FEAA).

The affidavit of Clerk Scroggins, submitted into

evidence by the Postal Service, stated essentially

that the petitioner had, as charged, directed Clerk

Scroggins to falsify mail volume records and that he

was promised unlimited overtime for his cooperation.

On direct examination, though, Clerk Scroggins

denied that the petitioner had either directed him

to reweigh mail or weigh dispatches that were going

out of the building, or promised him overtime in re-

tu.n for the falsification of mail records. (T.R.

299 32-24).

Clerk Scroggins declined to answer a number of

questions on cross~-examination, asserting repeatedly,

"I have been advised by my counsel not to answer any

questions regarding my involvement in the case."

(1.R. 302:12-13). Por this specific reason, the

FEAA concluded,

~~

Since the purpose of cross-examination is to

test the credibility of the witness and the

truth of his statements made on direct exami-

mation, and the witness did ._- claim any

recognized privilege, his refusal to answer

relevant questions put to him by the agency

demonstrates his lack of credibility. We

conclude the witness’ affidavit is the more

credible evidence. (R. 63, San Francisco

Field Office Decision) (Emphasis added )

The affidavit of Clerk Gaffey submitted into evi-

dence by the Postal Service, again, stated essenti-

ally that the petitioner had, as charged, directed

him to falsify mail volume records and that he was

promised higher level pay and Quality Step Increases

for said cooperation.

On direct examination, though, Clerk Gaffey denied

that petitioner promised him higher level pay and a

Quality Step Increase for falsifying mail records.

(T.R. 288:16-24). When asked by the Hearing Officer

if he wished to correct or repudiate any other por-

tions of his affidavit, Clerk Gaffey indicated in the

affirmative, but upon the advice of counsel, declined

to be specific on the grounds of possible self-in-

crimination. (T.R. 294-295).

The FEAA concluded,

We do not tind the inconsistencies between

the witness’ affidavit and testimony as to

whether or not the [petitioner] promised

him a reward for falsifying mail records,

sufficient basis to disqualify the affidavit

for lack of credibility on the part of the

witness. (R. 64, Ibid.) (Emphasis added)

Clerk Whitley's affidavit stated too, as charged,

that petitioner had directed her to falsify mail

volume records.

On direct examination she denied that petitioner

had either directly or indirectly caused her to in-

flate PSDS or WLRS records. (T.R. 337:25; 338:5).

And, it should be noted as well, that Clerk Whitley

testified to the following:

1. That the interview with the postal in-

spectors lasted six hours. (T.R. 330:6-18).

2. That she was told by the Inspectors that

the interview was long because she was a

"tough nut to crack.” (T.R. 350:19-23).

3. That she asked but was not allowed to

go to the bathroom--even though she was

bleeding (menstruation). (T.R. 332:9-25).

4. That upon reviewing her affidavit she

told the Inspectors that it contained

=10=

statements which she simply had not made.

(T.R. 335:1-3).

5. That the Inspectors told her what cor-

rections to make on her affidavit. (T.R.

343:4; 344:6).

6. And finally, she testified, "I would have

signed my death warrant [at that time. I was

a] nervous wreck [and only wanted to go home].”

(T.R. 336:3-10)

Postal Inspector Russell D. Johns, who prepared

statistical summaries of mail volume data, testified

that the mail volume at the Rincon Annex was exces-

sively high while the petitioner was Acting Tour II

Superintendent and that in May, June and July of 1974,

after the petitioner was removed from his position,

there was a substantial drop in mail volume. On

cross-examination, however, Mr. Johns conceded that

during the summer months there is always a volume

drop at all facilities. And, although information

was requested for mail volume figures covering the

period just prior to the petitioner's tenure as

Acting Tour II Superintendent, this additional data

was denied petitioner.

The affidavits of Douglas Fox and Alexander

Kleinman, who did not testify at the hearing,

a@lie

submitted into evidence by the Postal Service,

described essentially specific instances when they

allegedly personally observed the petitioner's in-

volvement in mail volume falsifications. Said al-

legations, not corroborated by any other evidence

submitted by the Postal Service, were refuted by

the petitioner himself on direct examination.

(T.R. 364-370).

Finally, Ms. Mildred Coulter, for the Postal

Service testified essentially that the petitioner

allowed Mr. Scroggins to work overtime even though

his services were not needed.

On cross-examination, though, she testified that

she was not familiar with the duties performed by

Mr. Scroggins. (T.R. 274:6; 275:14).

It was based on the foregoing that the FEAA con-

cluded that the charges were sustained by the pre-

ponderance of the credible evidence, and that dis-

charge was not arbitrary, capricious or unreasonable.

C. Decision of the Appeals Review Board

The Appeals Review Board, in a decision dated

July 25, 1975, affirmed the FEAA determination that

petitioner was properly discharged from his position

with the Postal Service.

«1%

D. Proceedings in the District Court

The respondents moved for summary judgment on

the grounds that the record of the administrative

agency showed that its decision to remove peti-

tioner trom his employment was supported by sub-

stantial evidence. (Docket entry 14).

At the hearing on the respective motions, the

District Judge stated that the affidavits of Fox

and Kleinman, together with the portions of the af-

fidavits, which were not repudiated by the other

affiants during the administrative hearing, consti-

tuted substantial evidence to support the adminis-

trative decision. (R. 9). The District Judge de-

cided the case on the merits, rejecting the respon-

dents’ argument that the action was barred by the

doctrine of laches. Entry of formal or informal

findings of fact or conclusions of law was not re-

quired. See Rule 52(a), Federal Rules of Civil

Procedure.

E. Proceedings In the Court of Appeals

The Court of Appeals held that, "Because the af-

fidavits questioned here were admitted into evidence

without objection, were not subject of a motion to

strike, and had ‘rational probative force' (See

o] 3

Richardson v. Perales (1971) 402 U.S. 389, 407-408),

we now affirm." (Appendix 2a). ‘he Court of Appeals

did not apply the standards set forth by this Court

in Richardson v. Perales, supra, to the actual facts

of the case and ignored the fact that the questioned

affidavits were never in fact offered as evidence in

the administrative proceedings. Petitioner pointed

out these omissions to the Court of Appeals in his

petition for rehearing. Nevertheless, the Court of

Appeals adhered to its earlier opinion and treated

petitioner's criticisms of its opinion as untimely

claims which if entertained by that Court would un-

dermine the orderly process of appellate review.

(Appendix at 19a)

REASONS FOR GRANTING THE WRIT

THE DECISION OF THE COURT BELOW RAISES AN IM-

PORTANT QUESTION CONCERNING THE PROBATIVE EFFECT

TO BE ACCORDED HEARSAY EVIDENCE FROM NON-EXPERT

WITNESSES IN ADMINISTRATIVE PROCEEDINGS WHICH

WAS NOT DECIDED IN RICHARDSON v. PERALES (1971)

402 U.S. 389, AND THE DECISION BELOW IS EVEN IN

DIRECT CONFLICT WITH THIS COURT'S DECISION IN

RICHARDSON v. PERALES, supra.

The writ of certiorari may appropriately be granted

to review a decision of a Court of Appeals which con-

oLbe

flicts with a decision of this Court or which im-

properly extends a decision of this Court to a mate-

rially different factual context. See Wilkinson v.

United States, (1961) 365 U.S. 399, at 401, to re-

view improper application of Barenblatt v. United

States, 360 U.S. 109. |

This case squarely raises the issue of whether or

not the due process clause of the Fifth Amendment to

the United States Constitution prohibits the termina-

tion of a federal employee's employment on the ground

of misconduct where proof of such misconduct is based

entirely upon the hearsay statements of non-expert

witnesses.

The petitioner's interest in his employment with

the United States Postal Service is a protected lib-

erty. Arnett v. Kennedy (1974) 416 U.S. 134; and Ong

v. Tovey (C.A. 9, 1977) 552 F.2d 305, at 307. As such,

the removal of the petitioner from his employment on

the basis of evidence which is inadequate or incompe-

tent as a matter of law to constitute substantial evi-

dence violates petitioner's right to due process of

law under the Fifth Amendment. See, Henley v. United

States (M.D. Pa., 1974) 379 F.Supp. 1044.

In Richardson v. Perales, supra, this Court held

~15<

that when certain enumerated conditions exist the

written reports of medical experts may be received

in evidence in a Social Security disability deter-

mination proceeding and may constitute substantial

evidence, although such reports constitute hearsay.

For this case, it is sufficient to note weighty prac-

tical differences between Richardson and this case to

argue that the Richardson rationale should not have

been extended to cases of this character.

Pragmatic considerations of administrative neces-

sity and efficiency which factored in Richardson v.

Perales, supra, are not crucial in this case. In

Richardson, Mr. Justice Blackman noted that:

The [Social Security Administration's] admin-

istrative structure and proceedings, with es-

sential determinations numbering into the

millions, are of a size and extent difficult

to comprehend. (402 U.S., at 399)

Here, the removal of employees is not so common-

place that the machinery for determining the existence

of good cause would become ineffective if the agency

were precluded from relying entirely upon the affida-

vits of non-expert witnesses. Nor does this action

involve determinations to extend proposed benefits in

which the due process clause might countenance a more

relaxed standard of proof.

«16<

Rather, the personal liberty iuterest at stake

here involves actual and immediate infliction of

"grievous loss" by the withdrawal of accrued bene-

fits which commands a more rigorous standard of

proof. In the context of the "grievous loss" of

employment, the application of a rigorous standard

of proof impacts upon administrative practices which

have historically been structured to accommodate

limits of a judicial character upon its operations.

See, Federal Personnel Manual (FPM), Chapter 752,

Adverse Actions by Agencies.

It should be noted that the decision to inflict

"grievous loss" by the termination of employment is

the product of the agency acting in an adversarial

capacity and not as an impartial adjudicator which

tips the balance in favor of a higher quality of

proof.

The Court of Appeals gave no apparent weight or

consideration to the important liberty interest at

stake and cavalierly extended Richardson v. Perales,

Supra, to employee discharge cases and approved the

use of ex parte affidavits to sustain the agency's

burden of showing that the decision to discharge was

based upon substantial evidence. In its order denying

ale

rehearing, the Court of Appeals commented that:

ex parte affidavits could not be used to

determine the existence of substantial proba-

tive evidence where they were inconsistent

with other evidence or where the court could

find bias in the affidavits' source. This is

a misstatement of the holding in that case.

Rather, Perales states the rule that in the

administrative hearing context hearsay is

admissible if it is reliable and probative.

Richardson v. Perales, supra at 407-08.

(Appendix at 17a and 18a)

The Court of Appeals failed to acknowledge that

this Court was addressing itself to a particular

specie of hearsay evidence, affidavits of medical

experts. As this Court noted in Richardson, "...

the reliability and probative worth of written medi-

cal reports even in formal trials ... have admitted

them as an exception to the hearsay rule." (389 U.S.

at 405). Further, as this Court again noted in

Richardson, Courts of Appeals had uniformly recog-

nized reliability and probative value in such re-

ports." (Ibid). This Court clearly did not sanction

either the receipt of non-expert hearsay affidavits

into evidence in administrative proceedings nor ap-

prove their use to constitute substantial evidence.

The decision of the Court of Appeals is in direct

oiBe

conflict with this Court’s decision in Richardson.

This Court held in Richardson that ex parte affida-

vits could not be utilized to determine the existence

of substantial evidence where they were inconsistent

with other evidence or where courts could "ascribe

bias" to the source of the evidence. (402 U.S. 402-04).

The hearsay evidence in this case was both inconsis-

tent with the direct testimonial evidence, bias could

be ascribed to the sources of such evidence, and it

lacked "rational probative force."

Each of the three affiants was an admitted parti-

cipant in the alleged false mail weighing scheme; as

participants in the unlawful enterprise, each of them

had an apparent bias and interest. Therefore, the

hearsay evidence derived from consideration of any of

their affidavits did not satisfy the first enumerated

precondition for the receipt of hearsay evidence set

forth in Richardson v. Perales, supra, 402 U.S. at 402.

There, this Court held that to "assure underlying re-

liability and probative value" of hearsay evidence,

courts must not be able to "ascribe bias" to the source

of the evidence. (Ibid.)

Clerk Scroggins denied on direct examination that

the petitioner had promised him overtime in return for

-19-

falsification of mail records, and denied that the

petitioner had directed him to reweigh mail or weigh

dispatches that were going out of the building. (T.R.

299:2-24). But the respondents asserted nevertheless

that Clerk Scroggins’ affidavit (which states essen-

tially that the petitioner directed him to fulsify

mail volume figures) was independently corroborated

by other probative evidence adduced at the administra-

tive hearing: (1) Inspector Johns - "... he observed

Mr. Scroggins arbitrarily write down some 30 to 40

different two digit numbers indicating that he had

dispatched hundreds and hundreds of trays and racks

of mail." (2) Films taken by the U.S. Postal Service

"clearly show the witness [Scroggins] weighing mail

for dispatch out of the San Francisco Post Office,

weighing dispatch into operations 035, 040, 043, 150

and 160."

The "other" evidence suggests at most that Clerk

Scroggins himself was participating in a mail volume

falsification scheme. There is no suggestion whatso-

ever, as alleged in the charges against petitioner,

that any falsification, if it in fact existed, took

place at his direction.

With regard to Clerk Gaffey's affidavit, the

respondents noted that,

the aspect of the affidavit specifically

repudiated by Gaffey did not disqualify

his affidavit en toto because it bore no

relation to the issue raised by plaintiff's

appeal." (R. )

Clerk Gaffey repudiated on direct examination one of

the very allegations for which the petitioner was dis-

charged, that he promised Clerk Gaffey overtime and a

quality step increase for falsifying mail records.

(T.R. 288:16-24).

Similarly, Clerk Whitley, on direct examination,

and contrary to her affidavit, denied that the peti-

tioner had either directly or indirectly caused her

to inflate PSDS or WLRS records. (T.R. 337:25-338:5).

Indeed, one is hard pressed to avoid the inevitable

conclusion, that the hearsay statements in question

here are unreliable. All three affiants, when giving

their respective statements, were themselves the sub-

jects of investigation by the Postal Inspection Ser-

vice. It is entirely logical to conclude that the

affiants had a personal interest in giving statements

which would tend to save their jobs by implicating

a2le

6/

their immediate supervisor.—

The respondents further asserted that the admini-

strative record in this case contains statistical

analysis prepared by Postal Inspector Russell D. Johns

which furnish additional evidentiary support that peti-

tioner engaged in the misconduct upon which his dis-

charge was based. Even conceding, as found by the

FEAA that such evidence,

compels a finding that large scale falsi-

fications were occurring during the plain-

tiff's tenure on Tour 2 at the Rincon

Annex,

that evidence is yet deficient with regard to whether

Or not the petitioner was responsible for those falsi-

fications.

6/ Clerk Whitley testified significantly: (1) that the

interview by the Postal Inspectors lasted six hours

(T.R. 330:6-18); (2) that she was told by the Inspec-

tors that the interview was long because "she was a

tough nut to crack." (T.R. 330:19-23); (3) that she

asked but was not allowed to go to the bathroom--

ven though she was bleeding (menstruation) (T.R.

332:9-25); (4) that upon reviewing her affidavit she

told the Inspectors that it contained statements which

she simply had not made (T.R. 335:1-3); (5) that the

Inspectors told her what corrections to make on her

affidavit (T.R. 343:4-344:6); (6) and finally, she

testified: "I would have signed my death warrant [at

that time]. [I was a] nervous wreck [and only wanted

to go home]." (T.R. 336:3-10) .

a2%e

The testimony of Inspector Johns tended to in-

dicate that there was a period in February, March,

and April of 1974, while the petitioner was Acting

Tour Superintendent, when mail volume at the Rincon

Annex was excessively high. Further testimony tended

to indicate that in May, June, and July of 1974, after

the petitioner was removed from his position, there

was a substantial drop in mail volume. However, on

cross-examination, Mr. Johns conceded that during the

summer months there is always a volume drop at all

facilities. And, although information was requested

for mail volume figures covering the period of Febru-

ary, 1973 to July, 1974, this period being critical

to show whether the same growth pattern was evident

during the administration of other tour superinten-

7

dents, this additional data was denied the petitioner.’

It is noted that affidavits executed by Alexander

Kleinman and Douglas Fox were submitted into evidence

7/ Besides the inference that other tour superinten-

dents of other administrations may have been responsi-

ble for the falsification for which the petitioner was

discharged, it should be noted that while the peti-

tioner was the acting tour superintendent, there were

two other tour superintendents, during the same admin-

istration and on the same tour, who may in fact have

been responsible for the acts charged the petitioner.

ate

and that these affidavits described specific in-

stances when the petitioner was allegedly involved

in mail volume falsifications. But it should be

emphasized here that the agency failed to produce

any evidence which would support those hearsay al-

legations. Indeed, said allegations were refuted

by the petitioner himself on direct examination.

"...(M)ere hearsay lacking sufficient assurance of

its truthfullness is not substantial evidence to

overcome the swora testimony of a claimant." McKee

v. U.S., 500 F.2d 525, 528.8/

Finally, the respondents contended in the Court

below that,

Ms. Mildred Coulter testified that [appellant]

fulfilled his promise to compensate Clerk

Scroggins for participating in the mail

volume falsification scheme by allowing

Mr. Scroggins to work overtime even though

his services were not needed. (R. )

Not only did Ms. Coulter testify that she was not

familiar with the duties performed by Mr. Scroggins

(T.R. 274:6; 275:14), there is also nothing in her

testimony to support the bald assertion made by the

8/ See also Consolidated Edison Co., v. NLRB, supra;

Willapoint Oysters Inc. v. Ewing (9th Cir. 1949)

174 F.2d 676, 691.

atin

respondents that such overtime resulted because

petitioner had in fact promised Clerk Scroggins

compensation for participation in a mail volume

falsification scheme.

The administrative record is quite clear. Other

than the hearsay evidence submitted in this matter

by the Postal Service, there is no other evidence

to support these administrative findings of fact.

"Mere uncorroborated hearsay or rumor does not con-

stitute substantial evidence." (Consolidated Edison

Co. v. NLRB, supra.)

The administrative decision to terminate peti-

tioner's employment cannot be saved by treating the

resort to and reliance upon hearsay as mere credi-

bility determinations of the agency. Indeed, credi-

bility determinations are the prerogative of the

agency as fact finder; however, the so-called credi-

bility determinations made by the agency in this

action are legally incorrect. They do not give any

manifest recognition of the realities of the prac-

tice of judicial review of administrative decisions.

As noted by Professor Davis in his authoritative

treatise, Administrative Law Treatise, Section 29.06,

at 144,

aPte

The question whether a court which sets

aside an administrative finding has sub-

stituted judgment as to credibility of

witnesses or has merely applied the rea-

sonableness test to the question of credi-

bility is exceedingly elusive.

The truth of the matter is that said "substitution"

has in fact been condoned.

Decisions by administrative factfinders as

to demeanor and credibility will be over-

turned by this Court only when the evidence

to the contrary is overwhelmingly compelling.

NLRB_v. Bausch & Lomb, Inc. (C.A. 2, 1975)

526 F.2d 817, 822.

We . . . firmly believe from an examination

of the entire record, that the evidence of

the seven employees or ex-employees is more

credible than that of [the one]. [Citations]

We reach this decision in full awareness of

the rule that the question of credibility of

witnesses and the weight to be given their

testimony is primarily one for determination

by the trier of facts. [Citations] But the

rule is not one to be applied mechanically,

for if we were to so apply it, the ... re-

viewing court would be compelled to sustain

any finding as to which testimonial evidence

was conflicting. [Citation] ‘This case is

one in which we feel that the record as a

whole requires that we disregard the credi-

bility findings of the Hearing Officer and

the Board, and we, therefore, reject them.

NLRB _v. Payless Chashway Lumber Store (C.A.8,

1974) 508 F.2d 24, 27-28.

a

Similarly, the record as a whole, present in this

case, as demonstrated above, requires that Hearing

Officer Biggers' credibility findings be rejected.

Such an action is not without precedent and certainly

not devoid of the considerations found to exist in

NLRB v. Payless Chashway Lumber Store, supra.

Acceptance of the hearsay evidence from the clerks

instead of their testimony at the hearing, on the

grounds the former was more credible, was arbitrary

and capricious. Mr. Scroggins testified fully and

completely that petitioner was not involved in the

scheme. However, on the advice of his counsel, Mr.

Scroggins refused to testify at the hearing as to his

own involvement and asserted his privilege against

self-incrimination. (T.R. 297-304). The privilege

against self-incrimination may be asserted in admin-

istrative proceedings. Murphy v. Waterfront Com'n.

(1964) 378 U.S. 52.

It was totally arbitrary and capricious in the face

of Mr. Scroggins' assertion of the privilege against

self-incrimination to have found that his hearsay

Statements were more credible than his testimony

at the hearing. Mr. Scroggins' assertion of his

privilege was presumtively due to his genuine fear

-2]-=

that any statement which he made about his own per-

sonal involvement would have incriminated him, rather

than due to any want of credibility. The dilemna

which Mr. Scroggins faced cannot be arbitrarily

sorted out by capriciously preferring his hearsay

statements over his actual testimony at the hearing.

A determination was required as to whether or not

Mr. Scroggins was in actual danger of incriminating

himself through his own testimony and whether he

should have been granted immunity or a promise of

non~prosecution in exchange for his testimony.

The agency preferred the hearsay statements of

Mr. Gaffey over his testimony at the hearing on the

grounds that,

We do not find the inconsistencies between

the witness’ affidavit and testimony as

to whether or not appellant promised him

a reward for falsifying mail records, suffi-

cient basis to disqualify the affidavit for

lack of credibility on the part of the wit-

ness. (Appeal Review Board, R. 64, Docket

entry 14).

Such inconsistencies preclude reliance upon the

hearsay statements of a non-expert witness altogether.

Richardson v. Perales, 402 U.S., at 404. The fifth

enumerated conditions for the consideration of hear-

ntGe

say in administrative proceedings set forth in

Richardson v. Perales, supra, was the absence of

inconsistency. There, the requisite absence of

inconsistency was among the five specialists who

examined the claimant. Here, the presence of in-

consistency appears in the testimony and hearsay

statements of the very witness upon whom the agency

relied in part to supply evidence to support its

decision to discharge petitioner.

Again, the agency simply capriciously preferred

the hearsay statements of Clerk Gaffey. At the hear-

ing, Mr. Gaffey appeared with his attorney and claim-

ed his privilege against self-incrimination. (T.R.

294-95). Mr. Gaffey testified that the statements

in his affidavit to the effect that the petitioner

had promised him a Quality Step Increase to falsely

weigh the mail was incorrect. (T.R. 288). Again, no

reasonable decision was made to ascertain if Mr.

Gaffey had a valid basis for asserting the privilege

or if he had waived it.

Clerk Whitley testified to circumstances which if

true rendered her statements the product of illegal

coercion. (See, note 6, Supra, at 21). Yet, Ms.

Whitley's hearsay statements were accepted over testi-

mony at the hearing.

29

On the record of the administrative proceedings,

it is clear that the decision to remove petitioner

from his job deprived him of due process of law. As

shown above, that decision was based entirely upon

evidence which was not adduced at the hearing. A

decision based entirely upon hearsay statements of

non-expert witnesses is tantamount to no hearing at

all. Due process requires, as was stated in Gold-

berg v. Kelly (1970) 397 U.S. 254, at 271:

the decision-maker's conclusion as

to a recipient's eligibility must rest

solely on the legal rules and evidence

adduced at the hearing. (emphasis added)

The Court of Appeals failed to adhere to the limi-

tations imposed by this Court to the receipt of hear-

Say evidence in administrative proceedings and pat-

ently misapplied this Court decision in Richardson

to a materially different and inappropriate factual

context.

In Richardson, this Court did not give carte blanche

approval to the use of ex parte affidavits in admini-

Strative proceedings. Rather, this Court was careful

to precisely delineate the type of ex parte affida-

vits which could be received in administrative pro-

ceedings. This Court held that,

~30-

We conclude that a written report by a

licensed physician who has examined the

claimant and who sets forth in his report

his medical findings in his area of compe-

tence may be received as evidence in a

disability hearing and, despite its hearsay

character and an absence of cross-examination,

and despite the presence of opposing direct

medical testimony and testimony by the

claimant himself, may constitute substan-

tial evidence supportive of a finding by

the hearing examiner adverse to the claimant,

when the claimant has not exercised his

right to subpoena the reporting physician

and thereby provide himself with the op-

portunity for cross-examination of the

physician. (402 U.S. at 402)

This case provides a full record upon which this

Court may review the decision of the Court of Appeals.

Petitioner urges the Court to grant review not only

to decide the broad question of the rights of federal

employees in discharge proceedings but to also pro-

vide the petitioner with his last opportunity to re-

move the unjust stigma of criminal wrongdoing which

attaches to his name as results of his unjust removal

from the federal service.

The remedy proposed by the Court of Appeals to

cope with the problem of inadmissable hearsay in

administrative proceedings of a motion to strike is

00?

not an efficacious one. (Appendix at 12a). In

reality, the proposed remedy is a trap for the

unwary. It assumes that an actual offer of the

hearsay evidence was made and that it was condi-

tionally received. In the instant case, the hear-

say affidavits were never actually offered into

evidence nor marked for identification. Rather,

the objectionable affidavits were made a part of

the record in compliance with FPM, Subchapter 4,

Section S. 4-2. This section required the inclu-

Sion of the affidavits in order that the agency

Satisfy its burden of giving notice of all reasons

for the proposed adverse action in the advanced

notice. The affidavits became a part of the record

in satisfaction of formal procedural requirements,

and not in explicit support of the agency's eviden-

tiary burden. Thus, petitioner could hardly be ex-

pected to protect his interests by objecting to the

hearsay evidence or moving to exclude it.

It is simply not fair to say in one breath that

the restricted rules of evidence common to judicial

proceedings are inappropriate in administrative pro-

ceedings and in the other to posit the adversarial

tools used in such judicial proceedings as the remedy

for the denial of fundamental rights in administrative

proceedings,

xe

CONCLUSION

For the foregoing reasons, the petition for a

writ of certiorari should be granted and the de-

cision of the court below reversed.

HOWARD MOORE, JR.

The London Building

160 Franklin Street

Oakland, CA 94607

Attorney for Petitioner

April, 1981

la

UNITED STATES CQURT OF APPEALS

FOR THE NINTH CIRCUIT

JAMES L. CALHOUN,

Plaintiff-Appellant, No. 78-1705

Vv.

BENJAMIN F. BAILAR, PostMaster

General of the United States, ) August 27, 1980

OPINION

Defendant-Appellee. )

)

Appeal from the United States District Court

tor the Northern District of California

Before: WALLACE and FARRIS, Circuit Judges, and

KARLTON,* District Judge

KARLTON, J. |

Plaintiff challenges his discharge for falsifying

mail volume records on the ground that the adminis-

trative findings were not supported by substantial

evidence. He appeals from the district court's en-

try of summary judgment. The issue he posits on

appeal is whether or not hearsay statements, sub-

sequently disavowed on direct examination, consti-

*The Honorable Lawrence K. Karlton, United States

District Judge, Eastern District of California,

sitting by designation.

2a

tute "substantial" evidence sufficient to support

the administrative determination.

fhis Court's review function in administrative

discharge cases is limited "to a determination that

the applicable procedures have been compiled with

and that the dismissal was supported by substantial

evidence and was not arbitrary and capricious."

Alsbury v. U.S. Postal Service (9th Cir. 1976) 530

F.2d 852, 854, cert. denied 429 U.S. 828. See also

5 U.S.C. 706. We do not try the case de novo, and

are limited to the record before us. Because the

affidavits questioned here were admitted into evi-

dence without objection, were not the subject of a

motion to strike, and had "rational probative force"

(See Richardson v. Perales (1971) 402 U.S. 389, 407-

408), we now affirm.

I

FACTS

For our purposes, the facts may be briefly sum-

marized. Plaintiff was Acting Tour II Superintendent

at the Rincon Annex of the United States Post Office

in San Francisco. His duties included the supervision

of several postal clerks engaged in compiling and

3a

reporting information on the volume of mail handled

by various distribution operations at Rincon Annex.

He was charged with the talsification of mail volume

records, or with directing his subordinates to fal-

sify the records and, after an administrative hearing

and appeal, discharged.

The Notice of Removal served upon Appellant (See

3 U.S.C. 7513(b)(1)) relied upon the affidavits of

four of his subordinates. Three of the aftfiants

aver that they had either falsified records at Ap-

pellant's direction or had observed him directing

others to falsify the records .+/

1/ The district court agruably relied upon a fifth

aftidavit of one Kleinman, despite an allegedly ex-

Press stipulation between the attorneys for plain-

tiff and defendant that said affidavit would not be

introduced as evidence. We need not reach this is-

Sue so long as there was substantial evidence suf-

ficient to uphold the administrative discharge.

"District Court review of agency action is generally

accorded no particular deference, because the dis-

trict court, limited to the administrative record,

is in no better position to review the agency than

the court of appeals." Asarco, Inc. v. U.S.E.P.A.

(9th Cir. 1980) 616 F.2d ll:3, 1161.

4a

At the administrative hearing the officer who

took the affidavits laid a proper foundation for

their admission, testifying that each affiant was

warned both orally and in writing of his or her

constitutional rights and was given an opportunity

to review and revise the statement before swearing

to it. The affidavits were received into evidence

without objection. No later motion to strike the

affidavits was made.

On direct ¢xamination each of the affiants at-

tempted to disavow his or her affidavit. Affiant

Scroggins completely disavowed the affidavit on di-

rect examination but refused to answer any questions

on cross examination, presumably on self-incrimina-

tion grounds. Evidence was later admitted that

clearly contradicted his statement on direct exami-

nation that he had never reweighed mail. Addition-

ally, another witness, Inspector Johns, testified

that Scroggins had admitted to him that he had re-

weighed mail at Appellant's behest.

Affiant Gaftey denied on direct his averment that

he had been promised additional overtime or a step

increase in salary in return for falsifying the

records, but otherwise apparently affirmed his

5a

averment that Appellant directed him to falsify

records.’

Affiant Whitley totally disavowed her affidavit

and testified that she was coerced into signing it.

Inspector Johns was the only major witness. He

testified that he had observed widespread falsifi-

cation during Appellant's tenure as Supervisor, and

introduced statistical evidence that tended to show

falsification in Appellant's unit. Other evidence

corroborated Johns’ testimony that falsification was

occurring, although this testimony, like Johns', did

not directly tie the falsitication to Appellant.

As noted, Appellant did not challenge the admis-

sibility of the affidavits at any time during the

administrative process. At most, he argued the weight

that should be given to the affidavits. The hearing

examiner found that the affidavits were more credible

evidence than the statements made on direct examina-

tion, in part because of the witnesses' refusal to

answer questions put in cross examination and because

2/ Although it is less than wholly clear what was

affirmed and what was disavowed, it appears that

Gaffey did not disavow his averment that Appellant

directed him to falsify records.

6a

portions of the affidavit were corroborated hy

other evidence. This conclusion was sustained

by the Appeals Review Board.

II

DISCUSSION

There is no question that the statements in the

affidavits would constitute substantial evidence if

they were introduced as direct testimony. The af-

fidavits individually and cumulatively support a

finding that Appellant was involved in the falsi-

fication of records. Indeed, Appellant concedes

that the affidavits themselves would be sufficient

to support a finding if they were uncontradicted.

Appellant argues, however, that hearsay statements

disavowed by a declarant can never supply substan-

tial evidence. We decline to adopt such a rigid

rule, both because it is unnecessary to the resolu-

tion of this case and because the substantial evi-

dence test is quintessentially a case-by-case analy-

sis requiring review of the whole record. See K.

Davis, Administrative Law of the Seventies (1976)

§14.11. Nevertheless, the case does raise impo.7tant

and difficult questions concerning the procedure for

dealing with administrative hearsay evidence.

7a

We begin with a recognition that strict rules of

evidence do not apply in the administrative context.

See Marlowe v. Immigration and Naturalization Service

(9th Cir. 1972) 457 F.2d 1314, 1315 (per curiam);

Navarette-Navarette v. Landon (9th Cir. 1955) 223

F.2d 234, 237, cert. denied 351 U.S. 91l. Indeed,

the Administrative Procedure Act provides that "Any

oral or documentary evidence may be received, but

every agency shall as a matter of policy provide for

the exclusion of irrelevant, immaterial, or unduly

repetitious evidence. A sanction may not be imposed

or rule or order issued except on consideration of

the whole record or those parts thereof cited by a

party and supported by and in accordance with the

reliable, probative, and substantial evidence." 5

U.S.C. §556(d). (Emphasis added) See K. Davis,

Administrative Law Treatise §14.05. Applicable reg-

ulations provide that "Rules of evidence are not

applied strictly. . . ." 5 CFR §771.116(£) (3).

Perhaps the classic exception to strict rules of

evidence in the administrative context concerns hear-

say evidence. Not only is there no administrative

rule of automatic exclusion for hearsay evidence, but

the only limit to the admissibility of hearsay evi-

8a

dence is that it bear satisfactory indicia of re-

liability. We have stated the test of admissibility

as requiring that the hearsay be probative and its

use fundamentally fair. See Hoonsilapa v. Immigra-

tion and Naturalization Service (9th Cir. 1978) 575

F.2d 735, 738, modified 586 F.2d 755; Marlowe v. Im-

migration and Naturalization Service, supra; Martin-

Mendoza v. Immigration and Naturalization Service

(9th Cir. 1974) 499 U.S. 984. See also Richardson

v. Perales, supra at 407-408.2/

Thus, it is not the hearsay nature per se of the

proffered evidence that is significant, it is its

probative value, reliability and the fairness of its

use that are determinative. Richardson v. Perales,

supra, illustrates the appropriate analysis. In that

case the issue was whether physicians’ written re-

ports of the medical examinations they had made of

a disability claimant could constitute substantial

evidence to support a finding of nondisability "when

3/ Appellant's reliance on National Labor Relations

Board cases is misplaced since those actions are

guided by 29 U.S.C. 160(b) which requires that "so

far as practicable" rules of evidence should be fol-

lowed. See NLRB v. Amalgamated Meat Cutters (9th Cir.

1953) 202 F.2d 671, 673; 32 A.L.R.Fed. 838

9a

the claimant objects to the admissability of those

reports and when the only live testimony is pre-

sented by his side and is contrary to the reports."

id. at 390 (Emphasis added). The Court rejected a

rigid rule and held that the proffered hearsay evi-

dence could constitute substantial evidence. In

doing so, the Court explained that there could be

no blanket rejection of administrative reliance on

hearsay evidence irrespective or reliability and

probative value. Id. at 407-408.4/

Although Richardson arose in the context of a

Social Security hearing, various courts have followed

its reasoning to hold that hearsay, if reliable and

credible, could constitute substantial evidence in

a variety of administrative Settings. See, e.g.

4/ Richardson expressly rejected any contrary holding

that might be distilled from dicta in Consolidated

Edison Co. v. NLRB (1938) U.S. 197, 229-230. In

Willapoint Oysters v. Ewing (9th Cir. 1949) 174 F.2d

676, cert.denied 338 U.S. 860, rehearing den. 339

U.S. 945, this Court relied upon Consolidated Edison

to hold that hearsay alone, or even hearsay corrob-

orated by a mere scintilla could never provide sub-

stantial evidence to support an administrative find-

ing. Id. at 690-691. Richardson, of course, clearly

disapproves such a rule.

10a

McKee v. United States (Ct.Cl. 19/4) 500 F.2d 525,

528 (Board of Contract Appeals); Reil v. United

States (Ct.Cl. 1972) 456 F.2d 777, 780 (Civil

Service Commission employee discharge); School Board

of Broward City v. HEW (5th Cir. 1976) 525 F.2d 900,

905-907 (challenge to order of Department of HEW);

but Cf. Bethlehem Steel Corp. v. Clayton (5th Cir.

1978) 578 F.2d 113.

We too reject any per se rule that holds that

hearsay can never be substantial evidence. To con-

stitute substantial evidence, hearsay delcarations,

like any other evidence, must meet minimum criteria

for admissability--it must have probative value and

bear indicia of reliability. Although no bright line

test can be established, cases isolate a number of

factors that may be helpful in such an analysis.

First, as Richardson teaches, the independence or

possible bias of the declarant must be considered

as well as the type of hearsay material submitted.

In Richardson, the Court laid great stress on the

fact that the reports were independent medical re-

ports routinely prepared and submitted in disability

cases. Id. at 402-407. Other factors that should

be considered are whether the statements are signed

and sworn to as opposed to anonymous, oral, or un-

lla

sworn (See, e.g. Martin-Mendoza v. Immigration and

Naturalization Service, supra; McKee v. U.S., Supra),

whether or not the statements are contradicted by di-

rect testimony (School Board of Broward City v. HEW,

Supra; Jacobowitz v. U.S. (Ct.Cl. 1970) 424 F.2d 555),

whether or not the declarant is available to testify,

and, if so, whether or not the party objecting to the

hearsay statements subpoenaes the declarant (See

Richardson v. Perales, supra), or whether the de-

clarant is unavailable and not other evidence is

available (Martin-Mendoza v. Immigration and Natural-

ization Service, supra; McKee v. U.S., supra), the

credibility of the declarant if a witness, or of the

witness testifying to the hearsay (Reid v. U.S.,

supra), and finally, whether or not the hearsay is

corroborated. Although not controlling, the Federal

Rules of Evidence 803(24) standards for the admission

of hearsay not specifically covered by any exception

but bearing "circumstantial guarantees of trustworthi-

ness" may be of assistance.

There remains only the question of the appropriate

vehicle for application of these tactors. As noted,

hearsay evidence, once admitted, may be relied upon

by the agency in many circumstances. The test of

l2a

reliability requires an examination of many factors

including credibility. Reviewing courts may take

the record as they find it in administrative cases

and thus have no opportunity to develop the record.

A rule which requires administrative consideration

of probative value and reliability in the first in-

stance comports with common sense and the limited

review of administrative actions. Such a rule would

also comport with the general rule that hearsay ad-

mitted without objection is ordinarily given its

normal probative effect. See K. Davis, Administra-

tive Law Treatise §14.05 at 275 n.8; Cf. Hayden v.

Chalfant Press, Inc. (9th Cir. 1960) 281 F.2d 543,

548. See generally 79 ALR 2d 890.

We therefore hold that hearsay evidence admitted

without objection or later motion to strike may con-

stitute substantial evidence in like manner as any

other evidence. This rule encourages the full de-

velopment of the record and allows the administrative

examiner to determine questions of reliability and

probative value in the first instance. If the hear-

ing examiner overrules an objection or a motion to

strike, the reviewing court is nonetheless presented

with a developed record.

13a

We note that a motion to strike is an entirely

appropriate means of raising the question of whether

hearsay, although admissible ab initio, should none-

theless be stricken because it will form the basis

of the decision and is insufficiently reliable for

that purpose. Since some of the factors relevant to

determining the reliability of hearsay include whether

or not it is contradicted or corroborated, as well as

whether witnesses are credible, objection need not be

made at the time the hearsay evidence is proffered.

A motion to strike made at the close of evidence

allows the hearing examiner to consider the entire

record. Cf. Hayden v. Chalfont, Press, Inc., supra.

Additionally, a motion to strike at the close of the

evidence provides the Administrative Law Judge with

a full opportunity to evaluate the centrality of the

hearsay to the disposition of the matter. Clearly,

the more central the hearsay is to the agency's case,

the more critical the question of reliability may

become. In Richardson v. Perales, supra, the Court

listed nine cumulative factors that indicated relia-

bility; while there is nothing magical in the number,

it is important that the Administrative Law Judge

critically examine the issues of fairness and relia~

l4a

bility on the record so that reviewing courts can

determine from the record that the duty has been

discharged.

In the present case, no objection was made to

the admission or consideration of the hearsay affi-

davits at any stage of the administrative proceedings.

Accordingly, we must give the affidavits their natu-

ral probative effect without regard to their hearsay

character. As such, the affidavits clearly provide

substantial evidence to support the discharge. Al-

though the affidavits are contradicted and partially

repudiated by other testimony, we have long held that

credibility issues should be resolved by the trier

of fact and not be disturbed on appeal (See, e.g.

Young Ah Chor v. Dulles (9th Cir. 1959) 270 F.2d 338),

and that where "there is conflicting evidence suf-

ficient to support either outcome, we must affirm

the decision actually made." Rhinehart v. Finch

(9th Cir. 1971) 438 F.2d 920, 921.2!

5/ Obviously in so saying we do not mean to suggest

that we would weigh the evidence in the same manner

as the administrative examiner did or that we would

arrive at the same conclusion. Moreover, we do not

Suggest that had the objection been raised either

the hearing examiner or this court would have arrived

at the same conclusion as to whether the affidavits

did possess sufficient indicia of reliability so that

the decision could properly rest upon them.

l5a

Accordingly, the judgment of the district court

is affirmed.

l6a

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

JAMES L. CALHOUN, )

Plaintiff-Appellant, No. 78-1705

)

)

Vv.

ORDER

BENJAMIN F. BAILAR, PostMaster)

G l of the United States

Se ne =e 4 January 6, 1981

Defendant—Appellee. )

)

Appeal from the United States District Court

for the Northern District of California

Before: WALLACE and FARRIS, Circuit Judges, and

KARLTON,* District Judge

KARLTON, J.

Appellant has previously appeared before this Court

challenging his discharge from the U.S. Postal Service

for falsifying mail volume records. On appeal from

the district court's entry of summary judgment the

appellant argued that certain hearsay statements did

not constitute "substantial" evidence sufficient to

Support the administrative determination. We affirmed

* The Honorable Lawrence K. Karlton, United States

District Judge, Eastern District of California,

sitting by designation.

17a

the district court because the affidavits in ques-

tion were admitted into evidence without objection,

were not the subject of a motion to strike, and had

“rational probative force” within the meaning of

Richardson v. Perales, 402 U.S. 389, 407-08 (1971).

Appellant has now filed a Petition for Rehearing be-

fore this Court and offers two arguments in support

of that petition. First, he asserts that this Court's

ruling in the present case is in direct conflict with

Richardson v. Perales, supra. Second, the appellant

argues that the hearsay affidavits in question were

never offered into evidence nor was he provided the

opportunity to object to their admission. Because

this Court properly applied Richardson v. Perales,

supra, and because the appellant has not previously

raised the issue of whether the affidavits were prop-

erly admitted into evidence, the petition must be

denied.

The appellant asserts that in Richardson v. Perales,

Supra, the Supreme Court ruled that ex parte affida-

vits could not be used to determine the existence of

substantial probative evidence where they were incon-

sistent with other evidence or where the court could

find bias in the affidavits' source. This is a mis-

18a

Statement of the holding in that case. Rather,

Perales states the rule that in the administrative

hearing context hearsay is admissable if it is re-

liable and probative. Richardson v. Perales, supra

at 407-08. That is the rule which we relied upon in

this case (See Opinion p.2). Moreover, that is the

interpretation which has been consistently applied

in this Circuit. Marlowe v. Immigration and Natural-

ization Service, 457 F.2d 1314, 1315 (9th Cir. 1972);

See, Hoonsilapa v. Immigration and Naturalization Ser-

vice, 575 F.2d 735, 738 (9th Cir. 1978), modified at

986 F.2d 755 (9th Cir. 1978); Trias Hernandez v. Im-

migration and Naturalization Service, 528 F.2d 366,

369 (9th Cir. 1975); and Martin-Mendoza v. Immigra-

tion and Naturalization Service, 499 F.2d 918, 921

(9th Cir. 1974), cert.denied 419 U.S. 1113, rehearing

denied 420 U.S. 984 (1975).

The appellant also argues that the hearsay affida-

vits in question were never actually offered into evi-

dence and thus he was not provided an adequate oppor-

tunity to object to their admission into evidence.

The appellant has not challenged the admissability of

these afficavits at any time during the administrative

or judicial proceedings regarding his discharge. At

19a

most, he has contested the weight that should have

been afforded the affidavits. Assertion of these

previously unraised claims now comes too late in the

day and does not warrant or require our present con-

sideration.2! See Jamestown Farmers Elevator, Inc. y.

General Mills, Inc., 552 F.2d 1285, 1296 (8th Cir.

1977); Bullock v. Mumford, 509 F.2d 384, 388 (D.C.

Cir. 1974). Moreover, were we to now consider ap-

pellant's untimely claims the orderly process of

appellate review would be seriously threatened.

Accordingly, the Petition for Rehearing is denied.

1/ Because the issue was not raised in a timely fash-

ion we need not consider the propriety of the process

by which the affidavits in question became part of the

evidentiary record in the present case.

20a

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

CIVIL NO.

C-77-0989-RHS

JAMES L. CALHOUN,

Plaintiff,

ORDER GRANTING

DEFENDANTS MOTION

FOR SUMMARY JUDGMENT

AND DENYING OTHER

MOT [ONS

February 28, 1978

Vv.

BENJAMIN F. BAILAR, PostMaster

General of the United States,

et al.

Defendants.

i a a a a Oe

This case came before the Court on the defendants’

motions tor Summary Judgment and the plaintiff's

motion for Summary Judgment and motion to compel dis-

covery. Those issues have been briefed and argued

and counsel have been afforded the Opportunity for

argument. The Court being fully informed in the

premises;

IT IS ORDERED that the defendant's motion for Sum-

mary Judgment is granted and the plaintiff's motion

for Summary Judgment, and discovery motion are denied.

The defendants shall prepare an appropriate judg-

ment with costs.

APPROVED AS TO FORM:

this date: (2/23/78)

(Howard Moore, Jr.) UNITED STATES DISTRICT JUDGE

Plaintiff's Attorney