MLA Enterprises, LLC v NC DMV, (04-1649) 11/01/2005

Appeal by Petitioner from order entered 6 August 2004 by Judge Forrest D. Bridges in Superior Court, Mecklenburg County. Heard in the Court of Appeals 10 October 2005.

Andresen & Associates, by Kenneth P. Andresen and Christopher M. Vann, for petitioner-appellant.

Attorney General Roy Cooper, by Assistant Attorney General Jeffrey R. Edwards, for respondent-appellee.

WYNN, Judge.

    Under N.C. Gen. Stat. § 20-183.8C(b)(2) (2004), emission inspection stations must not “[k]eep inspection stickers . . . in a manner that makes them easily accessible to individuals who are not inspection mechanics.” In this case, MLA Enterprises, LLC argues that that the trial court erred by holding it to a higher standard of safekeeping for inspection sticker than required under the statute. Because under the rule-making authority granted tothe Commissioner of Motor Vehicles, MLA Enterprises failed to safeguard the inspection stickers, we uphold the trial court's affirmance of DMV's order of suspension.
    On 14 July 2003, Inspector David Bailey of the North Carolina Department of Motor Vehicles (“DMV”) conducted a quarterly audit of the safety inspection station located at MLA Enterprises. Inspector Bailey first asked to check the inspection stickers of a mechanic who was performing an inspection, and the mechanic removed stickers from his pocket. When Inspector Bailey next asked to see the rest of the station's stickers, the mechanic took him into the owner's office. The office door was open, and no one was inside the office. Inspector Bailey then asked for the stickers, and the mechanic retrieved two books of stickers from the top of a file cabinet. The stickers had been placed behind a box and were not in plain view.
    Inspector Bailey cited MLA Enterprises with a Type II violation because the stickers were easily accessible to individuals who were not inspection mechanics, and he returned the next day to serve the “findings of violation” on MLA Enterprises's owner. Because this violation was MLA Enterprises's third Type II violation, the DMV entered a suspension order on 17 July 2003. The order suspended MLA Enterprises's license as a vehicle emission inspection station for ninety days and assessed a $250.00 civil penalty.
    On 25 August 2003, MLA Enterprises requested a hearing before the DMV on the incident for which it was charged. At the hearingon 4 September 2003, Inspector Bailey testified that the doors to the owner's office were open and no one was in the office when he entered. The owner appeared pro se and testified that he had put the stickers on the file cabinet and that he had shut the door when he left about twenty minutes earlier. He explained that his secretary had access to the office and probably did not close the door after going into the office to get change. While the owner argued at the close of the hearing that the stickers were hidden, he conceded “they weren't secure, I mean, I admit that, they weren't secure.”
    In an order entered on 16 September 2003, the hearing officer found Inspector Bailey had observed that MLA Enterprises “kept inspection stickers and other compliance documents in a manner that makes them easily accessible to individuals who are not inspection mechanics.” After finding that MLA Enterprises was in violation of section 20-183.3 of the North Carolina General Statutes and had committed a third Type II violation of section 20-183.8B of the North Carolina General Statutes, the hearing officer upheld the suspension of MLA Enterprises's license as a vehicle emission inspection station for ninety days and the assessment of a $250.00 civil penalty.
    On 1 October 2003, MLA Enterprises requested a hearing before Commissioner Tatum. In the correspondence which accompanied MLA Enterprises's request for a hearing, MLA Enterprises's counsel stated that the owner “accepts responsibility for these violations” but “he submits that a ninety-day suspension is disproportionatelysevere given the facts in this case.” MLA Enterprises also submitted a brief which presented new evidence in the form of attachments. These attachments consisted of photographs of the office and file cabinet along with affidavits from the owner, the inspection mechanic, and the cashier/secretary.
    Commissioner Tatum responded in a letter dated 26 November 2003 that he had conducted a review of the suspension of MLA Enterprises's inspection station license. He stated his “review included all pertinent orders, legal arguments, memoranda and other material contained in the files. After reviewing the complete file of this station,” he could find “no justifiable reason to overturn the order of September 16^th, 2003 . . ..” On 5 December 2003, MLA Enterprises filed a petition for judicial review of the Commissioner's decision.
    The trial court held a hearing on 28 April 2004, reviewed the whole record, and then affirmed the DMV's order of suspension in an order filed on 6 August 2004. Although the trial court found the attachments to the brief which MLA Enterprises had filed with Commissioner Tatum were material to the issues, it concluded that the attachments could have reasonably been presented at the administrative hearing and that remand to the agency was therefore not appropriate. The trial court concluded “[t]hat the Commissioner's decision was supported by substantial evidence even if he considered new evidence in the form of attachments presented by Petitioner[,]” and it affirmed the DMV's 16 September 2003 order of suspension. The trial court entered a second order on 6 August2004, in which it allowed a motion by MLA Enterprises to stay the order of suspension. In its notice of appeal filed on 12 October 2004, MLA Enterprises states it was served with a copy of the trial court's order on 6 October 2004. From the trial court's order, MLA Enterprises appeals.
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    MLA Enterprises first contends the regulations promulgated by the DMV “do not require that stickers be kept in a safe or under lock and key.” MLA Enterprises asserts the regulations only require that “stickers shall be secured to guard against loss or theft.” N.C. Admin. Code tit. 19, r. 03D.0524(4)(a) [sic] (August 2002). MLA Enterprises's argument is not persuasive.
    The statute in question, section 20-183.8C(b)(2) of the North Carolina General Statutes, makes it a Type II violation for an emissions inspection station to “[k]eep inspection stickers and other compliance documents in a manner that makes them easily accessible to individuals who are not inspection mechanics.” N.C. Gen. Stat. § 20-183.8C(b)(2) (2004). Under the rule-making authority granted by section 20-2(b) of the North Carolina General Statutes, the Commissioner has adopted rules to implement this statute. The applicable rule as to the control of windshield inspection stickers states the following:
        Licensed inspection stations and self- inspectors are strictly accountable for inspection stickers in their possession. Any licensed inspection station losing or not accounting for any inspection sticker shall be subject to revocation or suspension of inspection station license as provided by these Rules. Stickers shall be locked in asafe place to guard against loss or theft.

N.C. Admin. Code tit. 19A, r. 03D.0524(c)(1) (emphasis added). While the statute does not explicitly state that the stickers must be “under lock and key,” the rule adopted to implement the statute does require that the stickers be locked in a safe place. See id. The DMV did not commit an error of law in its interpretation of the statute's requirements, and the trial court correctly affirmed the DMV's interpretation of those requirements.
    MLA Enterprises next contends the trial court erred by affirming the DMV's order because the order was unsupported by substantial evidence. It argues the stickers were not “easily accessible to individuals who are not inspection mechanics” because they were kept in a locked office to which only a cashier had a key and that only the inspection mechanic knew the location where the stickers were hidden. MLA Enterprises's argument is without merit.
    In testimony before the hearing officer, Inspector Bailey stated the office doors were open. No one was inside when he and the mechanic entered the office. The owner never stated before the hearing officer that he locked the office door when he left, but he did state in his affidavit to Commissioner Tatum that he locked the door. He explained that the cashier probably left the door open during his absence. No evidence was presented which would suggest that the secretary/cashier who had a key to the office was an inspection mechanic.
    The owner further conceded before the hearing officer that the stickers “weren't secure, I mean, I admit that, they weren'tsecure.” In the correspondence which accompanied his request for a hearing before Commissioner Tatum, MLA Enterprises's counsel stated that the owner accepted responsibility for the violations but “submits that a ninety-day suspension is disproportionately severe given the facts in this case.” Substantial evidence supported the DMV's decision that MLA Enterprises violated section 20-183.8C(b)(2) of the North Carolina General Statutes, and the trial court properly affirmed the order of suspension.
    Affirmed.
    Judges CALABRIA and JACKSON concur.
    Report per Rule 30(e).

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