Jenkins v. UIA – 16.83

Jenkins v. UIA
Digest No. 16.83

Section 421.38

Cite as: Jenkins v UIA, unpublished opinion per curiam of the Court of Appeals, issued March, 7, 2013 (Docket Nos. 309625 & 309644).

Appeal pending: No
Claimant: Gary Jenkins
Employer: Unemployment Insurance Agency
Date of decision: March 7, 2013

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HOLDING: The courts only have subject matter jurisdiction with respect to Unemployment Insurance matters once all administrative proceedings are complete.

FACTS: On November 8, 2011, the ALJ mailed a decision holding that claimant was entitled to benefits under MCL 421.1 et seq. conditioned on Claimant’s being “otherwise eligible and qualified.” Claimant submitted the ALJ’s decision to the UIA, but the UIA refused to pay. Instead, the UIA initiated an investigation in order to determine whether MWJ Construction (Claimant’s employer) was an “employer” within the meaning of the MESA.  Claimant then filed a complaint requesting the circuit court to issue a writ of mandamus ordering the director of the agency to pay Claimant benefits. On January 27, 2012, the circuit court ordered the UIA to pay Claimant benefits. The UIA did not pay and on February 20, 2012, Claimant filed an ex parte motion for an order to show cause regarding why the UIA should be held in civil contempt for failure to comply with the court’s order. Two days before the show-cause hearing, the UIA tendered a check to the court in the full amount due to Claimant. The check was payable to the court and Claimant. At the show-cause hearing, the court found that the tendered check did not comply with the court order because it was payable to the court and Claimant instead of being payable solely to Claimant. The court found the UIA in contempt of court, ordered the UIA to pay Claimant in accordance with the January 27 order, and ordered the UIA to pay attorney fees and costs in connection with the contempt proceedings. The UIA appealed as of right from the order granting Claimant’s request for a writ of mandamus. Additionally, the UIA appeals by leave granted from an order finding the UIA in civil contempt.

DECISION: The court vacated both orders because the circuit court did not have subject matter jurisdiction in these matters.

RATIONALE: Direct review by the courts is only available when all administrative remedies available within the agency have already been exhausted by the parties. MCL 24.301. This is required because: (1) an untimely resort to the courts may result in delay and disruption of an otherwise cohesive administrative scheme; (2) judicial review is best made upon a full factual record developed before the agency; (3) resolution of the issues may require the accumulated technical competence of the agency or may have been entrusted by the Legislature to the agency’s discretion; and (4) a successful agency settlement of the dispute may render a judicial resolution unnecessary. Int’l Business Machines Corp v Dep’t of Treasury, 75 Mich App 604, 610; 255 NW2d 702 (1977).

Here, the standard procedures under MCL 421.33 were not followed with respect to the questions of whether MWJ Construction was an “employer” and whether plaintiff’s claim was valid. The ALJ did not explicitly decide whether MWJ Construction was an employer in the order, and the order was conditioned on Claimant’s being “otherwise eligible and qualified.”  As a result, the UIA was in the process of determining whether MWJ Construction was an employer, at the time the circuit court took jurisdiction. Since the administrative process was ongoing, the circuit court’s assumption of jurisdiction was in error.

Digest author: Cydney Warburton, Michigan Law, Class of 2017
Digest updated: 3/30/2016