Davis, J., dissenting:
Under the decision reached by the majority opinion in this case, every employer in the State of West Virginia must provide unemployment compensation benefits to employees who are terminated for obtaining employment through fraudulent misrepresentation and engaging in on-the-job criminal conduct prior to being terminated. I find the majority opinion to be offensive to every employer and citizen of West Virginia. Therefore, for the reasons provided below, I dissent. (See footnote 1)
It has been recognized that the concept of fraud is quite broad:
Fraud is sometimes defined as '[a] generic term, embracing all multifarious means which human ingenuity can devise, and which are resorted to by one individual to get advantage over another by false suggestions or by suppression of truth, and includes all surprise, trick, cunning dissembling, and any unfair way by which another is cheated.'
State ex rel. Medical Assurance of West Virginia, Inc. v. Recht, No. 30840, Slip op. at 7, ___ W. Va. ___, ___, ___ S.E.2d ___, ___ (April 30, 2003) (Davis, J., concurring) (quoting Volcanic Gardens Mgmt. Co. v. Paxson, 847 S.W.2d 343, 347 (Tex.Ct.App. 1993)). This Court has held that [a]ctual fraud is intentional, and consists of an intentional deception or misrepresentation to 'induce another to part with property or to surrender some legal right, and which accomplishes the end designed.' Gerver v. Benavides, 207 W. Va. 228, 232, 530 S.E.2d 701, 705 (1999) (quoting Stanley v. Sewell Coal Co., 169 W. Va. 72, 76, 285 S.E.2d 679, 683 (1981)). See also Hager v. Hager, No. 29688, Slip op. at 6, ___ W. Va. ___, ___, S.E.2d ___, ___ ( November 29, 2001) (holding that appellee in failing to testify fully and completely and honestly before the family law master, in effect, acted falsely and committed fraud.); Kessel v. Leavitt, 204 W. Va. 95, 127, 511 S.E.2d 720, 752 (1998) ('A . . . party's willful nondisclosure of a material fact that he knows is unknown to the other party may evince an intent to practice actual fraud.' (quoting Van Deusen v. Snead, 247 Va. 324, 328, 441 S.E.2d 207, 209 (1994))); Arnoldt v. Ashland Oil, Inc., 186 W. Va. 394, 404, 412 S.E.2d 795, 805 (1991) ('Fraud means an intentional misrepresentation, deceit, or concealment of material fact known to the defendant and made with the intention of causing injury to the plaintiff.' (quoting Ky. Rev. Stat. Ann. § 411.184(1)(b))); Miller v. Huntington & Ohio Bridge Co., 123 W. Va. 320, 335, 15 S.E.2d 687, 695 (1941) ('[F]raud includes cases of the intentional and successful employment of any cunning, deception, or artifice to circumvent, cheat or deceive another.' (quoting 23 Am. Jur., Fraud & Deceit § 4, at 756 (1939))); Holt v. King, 54 W. Va. 441, 447, 47 S.E. 362, 365 (1903) (The suppression of the truth is equivalent to the utterance of a falsehood, and both are frauds.); Currence v. Ward, 43 W. Va. 367, 377, 27 S.E. 329, 333 (1897) (Dent, J., concurring) ('Fraud . . . includes all acts, omissions, and concealments which involve a breach of legal or equitable duty, trust, or confidence justly reposed, or are injurious to another, or by which an undue advantage is taken of another.' (quoting Story, Eq. Jur. § 187)). Moreover, as Justice Albright recently observed in Cordial v. Ernst & Young, '[w]here one person induces another to enter into a contract by false representations, which he is in a situation to know, and . . . does know the statements to be untrue, and, consequently, they are held to be fraudulent[.]' 199 W. Va. 119, 130, 483 S.E.2d 248, 259 (1996) (quoting Syl. pt. 1, Horton v. Tyree, 104 W. Va. 238, 139 S.E. 737 (1927)).
In the instant proceeding, both the circuit court and the administrative law
judge found that Mr. Dailey misrepresented that he had a valid [driver's] license, and that
this misrepresentation constitutes gross misconduct. The majority opinion failed to
perform an analysis to determine whether the misrepresentation rose to the level of fraud
in order to support a finding of gross misconduct. It is obvious that the majority omitted such
an analysis because to do so would defeat the majority's desired result.
The essential elements of noncriminal fraud are: (1) that the act claimed to be
fraudulent was the act of the defendant or induced by him; (2) that it was material and false;
that plaintiff relied upon it and was justified under the circumstances in relying upon it; and
(3) that he was damaged because he relied upon it. Syl. pt. 1, in part, Lengyel v. Lint, 167
W. Va. 272, 280 S.E.2d 66 (1981). The facts in this case support a finding of fraud.
First, the fraudulent act in this case was Mr. Dailey's false representation of
the status of his driver's license. The circuit court summarized this point as follows:
[The employer] testified that when he interviewed [Mr. Dailey] in anticipation of hiring him, he asked [Mr. Dailey] if there were any problems with [his] operator's license. [Mr. Dailey] told [the employer] there were none.
Second, the issue of the status of Mr. Dailey's driver's license was material because the employment position he was seeking required him to drive gasoline trucks used to fill airplanes at the airport . . . [and] required him to drive off airport property to pick up bulk gasoline and to deliver or pickup passengers on public roads. The record is clear. Mr. Dailey lied when he stated during the job interview that he had a valid driver's license. The employer hired Mr. Dailey on the basis that he had a valid driver's license. (See footnote 2) Subsequent to hiring Mr. Dailey, the employer requested on several occasions that Mr. Dailey produce his driver's license for photocopying, as required by the employer's insurer. Mr. Dailey repeatedly offered excuses as to why he did not produce his driver's license when requested. The employer eventually obtained an official record from the Department of Motor Vehicles which indicated that Mr. Dailey's driver's license had been suspended before and after he was hired.
Third, the employer was damaged in several ways because of Mr. Dailey's
fraudulent misrepresentations. The employer was forced to incur expenses associated with
hiring a new driver because it had to fill the vacancy left when Mr. Dailey was fired. The
employer also incurred legal expenses in having to defend against Mr. Dailey obtaining
unemployment compensation for fraudulent conduct. Finally, Mr. Dailey's fraudulent
conduct was jeopardizing the employer, by potentially voiding the employer's insurance
coverage in the case of an accident involving [him].
It is clear to me that the misrepresentation found by the circuit court and the
administrative law judge was not an inadvertent or inconsequential misrepresentation. The
misrepresentation constituted fraud on the employer. As such, the misrepresentation was
gross misconduct. In order for the majority opinion to conclude otherwise, it had to totally
ignore the true posture of this issue and cast in a light that made it appear not to come under
the fraud component of W. Va. Code § 21A-6-3(2). It is indeed a sad moment in West
Virginia jurisprudence when our law blatantly permits wrongdoers to profit by their
fraudulent conduct and penalizes the victims of fraud by making them pay the wrongdoers.
See UB Services, Inc. v. Gatson, 207 W. Va. 365, 368, 532 S.E.2d 365, 368 (2000)
([I]ndividuals should not benefit from their own misdeeds[.]), overruled by the majority
opinion in this case.
(1) Driving without a license. The record in this case is not in dispute. Mr.
Dailey did not have a valid driver's license when he was hired by the employer. The record
is equally clear in showing that during the brief period of his employment, Mr. Dailey
operated the employer's motor vehicle without a valid driver's license. The majority opinion
totally disregarded the evidence indicating Mr. Dailey operated a motor vehicle without a
valid driver's license.
Pursuant to W. Va. Code § 17B-2-1(a) (2000) (Repl. Vol. 2000) [n]o person
. . . may drive any motor vehicle upon a street or highway in this state . . . unless the person
has a valid driver's license[.] Further, under W. Va. Code § 17B-2-1(f), it is a misdemeanor
offense for a person to operate a motor vehicle without a driver's license. Although Mr.
Dailey violated W. Va. Code § 17B-2-1(a) by knowingly driving his employer's vehicle
without a license, the majority has rewarded this criminal conduct with unemployment
(2) Obtaining money by false pretense. Under W. Va. Code § 61-3-24(a)(1)
(1994) (Repl. Vol. 2000) it is a criminal offense for a person [to] obtain from another by
any false pretense . . . with intent to defraud, any money, goods or other property[.] This
offense is punishable as a felony or misdemeanor, depending upon the value of the property
unlawfully obtained. The essential elements of the crime of false pretense are:
(1) the intent to defraud; (2) actual fraud; (3) the false pretense was used to accomplish the objective; and (4) the fraud was accomplished by means of the false pretense, i.e., the false pretense must be in some degree the cause, if not the controlling cause, which induced the owner to part with his property.
State v. Moore, 166 W. Va. 97, 108, 273 S.E.2d 821, 829 (1980) (citation omitted).
In this case, Mr. Dailey sought to obtain a job, wages and employment benefits, all of which were the property of the employer, by fraudulently misrepresenting the status of his driver's license. This misrepresentation directly caused the employer to give Mr. Dailey a job, wages and employment benefits. See State v. Zain, 207 W. Va. 54, 528 S.E.2d 748 (1999) (upholding an indictment under W. Va. Code § 61-3-24 that charged a defendant with obtaining wages and employment benefits while fraudulently performing his work).
Some background information is necessary to understand the reasoning behind
the majority's decision to overrule UB Services. UB Services involved the award of
unemployment compensation to an employee who was terminated after assaulting a co-
worker while off-duty. The employer argued that the assault by the employee constituted
gross misconduct and that he should be denied unemployment compensation. In order to
address this issue, the Court in UB Services set out various principles of law defining gross
misconduct. The opinion in UB Services cited to the examples of gross misconduct found
in W. Va. Code § 21A-6-3(2). The conduct by the employee did not fit under any of the
enumerated examples. Consequently, the opinion looked to the catch-all provision of the
statute that provided or any other gross misconduct.
In an effort to provide some structure and guidance to the phrase any other
gross misconduct, the opinion looked to a prior decision of this Court and stated the
We have previously defined gross misconduct as:
. . . conduct evincing such willful and wanton disregard of an
employer's interests as is found in deliberate violations or
disregard of standards or behavior which the employer has the
right to expect of his employee, or in carelessness or negligence
of such degree or recurrence as to manifest equal culpability,
wrongful intent or evil design, or to show an intentional and
substantial disregard of the employer's interests or of the
employee's duties and obligations to his employer. On the other
hand mere inefficiency, unsatisfactory conduct, failure in good
performance as the result of inability or incapacity,
inadvertencies or ordinary negligence in isolated instances, or
good faith errors in judgment or discretion are not to be deemed
misconduct within the meaning of the statute. Kirk v. Cole,
169 W. Va. 520, 524, 288 S.E.2d 547, 550 (1982) (emphasis
added) (quoting, Carter v. Michigan Employment Security
Commission, 364 Mich. 538, 111 N.W.2d 817 (1961)).
UB Services, 207 W. Va. at 367, 532 S.E.2d at 367 (emphasis in original). (See footnote 4) In view of this definition and other considerations, the decision in UB Services found that the off-duty conduct was gross misconduct that warranted a denial of unemployment compensation.
The definition for any other gross misconduct that was recognized in UB
Services was overruled by the majority without explanation. It is easy to understand why the
majority chose to overrule UB Services. All of the evidence in this case conclusively
demonstrated that Mr. Dailey's conduct in lying to obtain employment and operating his
employer's motor vehicle without a driver's license, constituted willful and wanton
disregard of [the] employer's interests as is found in deliberate violations . . . of standards
. . . which the employer has the right to expect of his employee. The majority could not
have reached its desired result in the instant case had it allowed the UB Services opinion to
In view of the foregoing, I dissent. I am authorized to state that Justice Maynard joins me in this dissenting opinion.