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Arbitrary and Capricious

[Also see 19-10 A.2.c]

In an appeal of a layoff, the employee bears the burden to prove the agency action was arbitrary, capricious, or contrary to rule or law. In re Sanders, CSA 62-09, 4 (9/24/10), citing Dept of Institutions v. Kinchen, 886 P.2d 700, 712 (Colo. 1994). 

The duty of a court reviewing agency action under the arbitrary or capricious standard is to ascertain whether the agency examined the relevant data and articulated a rational connection between the facts found and the decision made. In re Hamilton, CSA 100-09 & 107-09, 13 (9/17/10), citing Olenhouse v. Commodity Credit Corp., 42 F.3d 1560, 1574 (10th Cir.1994). 

A reviewing body must determine whether the agency considered all relevant factors and whether there has been a clear error of judgment. In re Hamilton, CSA 100-09 & 107-09, 13 (9/17/10), citing Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971). 

A decision is an abuse of discretion if it is made without a rational explanation, departs from established policies, or rests on considerations not intended by the governing law. In re Hamilton, CSA 100-09 & 107-09, 13 (9/17/10), citing Wong Wing Hang v. INS, 360 F.2d 715, 719 (2nd Cir. 1965). 

A discretionary agency action is capricious or arbitrary if the agency (1) fails to use reasonable diligence to procure facts necessary to its decision, (2) does not consider relevant evidence, or (3) bases its action on conclusions reasonable persons could not reach. In re Hamilton, CSA 100-09 & 107-09, 13 (9/17/10), citing Maggard v. Dept. of Human Services, 226 P.3d 1209, 1212 (Colo.App. 2009).

An act is arbitrary and capricious if a reasonable person, considering all the evidence in the record, would fairly and honestly be compelled to reach a different conclusion. In re Proctor, CSA 52-07, 3 (1/3/08), citing In re Leal-McIntyre, CSA 77-03, 134-03 & 167-03, 5 (1/27/05); Wildwood Child & Adult Care Program, Inc. v. Colo. Dept. of Public Health Care and Environment, 985 P2d. 654, 658 (Colo. App. 1999).

An agency action is arbitrary and capricious if an agency 1) fails to use reasonable diligence to determine facts necessary to its decision, 2) fails to give proper consideration to facts relevant to the decision, or 3) bases its action on conclusions that reasonable persons considering the facts would not reach. In re Foley, CSA 19-06, 8 (11/10/06), citing Lawley v. Dept. of Higher Education, 6 P3d 1239, 1252 (Colo. 2001).

The core of the concept of arbitrary and capricious action is rationality. In re Foley, CSA 19-06, 8 (11/10/06), citing Columbia Broadcasting System v. FCC, 454 F.2d 1018, 1028 (D.C.Cir. 1971).

A needs improvement performance review may only be reversed if appellant proves it was arbitrary, capricious, and without rational basis or foundation. In re Harrison, CSA 55-07, 89-07 & 90-07, 43 (6/17/10). [NOTE: rule applying to this case was amended 1/22/10 to state only a rating of"failing" may be appealed. See CSR 19-10 A. 2. c.].       

A layoff decision must be upheld unless it is determined to be arbitrary, capricious or contrary to rule or law. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), citing Velasquez v. Dept. of Higher Education, 93 P.3d 540 (Colo.App. 2003). 

An employee challenging a layoff must overcome the presumption of regularity afforded an agency in fulfilling its statutory mandate with a showing that it was arbitrary, capricious, or contrary to rule or law. In re Owens-Manis & Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), citing Motor Vehicle Mfrs. Assn. v. State Farm, 463 U.S. 29, 44 (1983); In re Vasquez & Lewis, CSA 08-09 & 09-09, 4 (5/20/09); In re Foley, 19-06, 8 (11/10/06); Brennan v. Dept of Local Affairs, 786 P.2d 426 (Colo.App. 1989).

The duty of a court reviewing agency action under the arbitrary or capricious standard is to ascertain whether the agency examined the relevant data and articulated a rational connection between the facts found and the decision made. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), quoting Olenhouse v. Commodity Credit Corp.,42 F.3d 1560, 1574 (10th Cir. 1994); Motor Vehicle Mfrs. Assn. v. State Farm, 463 U.S. 29, 43 (1983). 

In reviewing agency decision, it must be determined whether the agency considered all relevant factors and whether there has been a clear error of judgment. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), citing Motor Vehicle Mfrs. Assn. v. State Farm, 463 U.S. 29, 43 (1983); Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971).

Where there are no competent evidentiary facts to support the agency’s findings of ultimate fact, the decision must be reversed as arbitrary, capricious or contrary to rule or law. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), citing Womack v. Industrial Commission, 451 P.2d 761, 764 (Colo. 1969); Ricci v. Davis, 627 P.2d 1111, 1118 (Colo. 1981).   

If the agency relied on factors Congress did not intend it to consider, entirely failed to consider an important aspect of the problem, offered an explanation that runs counter to the evidence, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise, the decision would be arbitrary and capricious. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 11 (3/11/10), citing Motor Vehicle Mfrs. Assn. v. State Farm, 463 U.S. 29, 43 (1983). 

When an agency fails to explain the reason for its action, reviewing body may not supply a reasoned basis for that action but will uphold a decision of less than ideal clarity if the agency’s path may reasonably be discerned. In re Owens-Manis & Pettway, CSA 73-09 & 75-09, 12 (3/11/10), citing SEC v. Chenery Corp, 332 US 194, 196 (1947); Bowman Transp. Inc. v. Arkansas-Best Freight System, 419 US 281, 286 (1974). 

In challenging agency's merit increase calculation, appellants must overcome presumption of validity in administrative actions with a showing that the calculation was arbitrary, capricious, or contrary to rule or law. In re Vasquez & Lewis, CSA 08-09 & 09-09, 4 (5/20/09); See Velasquez v Dept. of Higher Education, 93 P3d 540 (Colo. App. 2003); Garner v Colorado State Dept. of Personnel, 835 P2d 527 (Colo. App. 1992); Renteria v Colorado State Dept. of Personnel, 811 P2d 797 (Colo. 1991).

Appellants failed to prove agency action was arbitrary or capricious by a preponderance of the evidence where agency presented compelling business efficiency reason for its action and evidence that it promoted consistency and fairness. In re Vasquez & Lewis, CSA 08-09 & 09-09, 3, 5 (5/20/09).

Where agency demonstrated that limiting merit increase processing to two days per month simplified pay periods and promoted a consistent and fair merit system, appellants failed to prove action was arbitrary or capricious. In re Vasquez & Lewis, CSA 08-09 & 09-09, 3, 5 (5/20/09).

An agency action is arbitrary and capricious if an agency 1) fails to use reasonable diligence to determine facts necessary to its decision, 2) fails to give proper consideration to facts relevant to the decision, or 3) bases its action on conclusions that reasonable persons considering the facts would not reach. In re Foley, CSA 19-06, 8 (11/10/06), citing Lawley v. Dept. of Higher Education, 6 P3d 1239, 1252 (Colo. 2001). 

The core of the concept of arbitrary and capricious action is rationality. In re Foley, CSA 19-06, 8 (11/10/06), citing Columbia Broadcasting System v. F.C.C., 454 F.2d 1018, 1028 (D.C.Cir. 1971).

An act is arbitrary and capricious if a reasonable person, considering all the evidence, would fairly and honestly be compelled to reach a different conclusion. In re Padilla, CSA 25-06, 11 (9/13/06), citing In re Leal-McIntyre, CSA 77-03, 134-03 & 167-03, 5 (1/27/05); Wildwood v. Colo. Dept. of Public Health Care, 985 P2d. 654 (Colo. App. 1999).

Express finding that “needs improvement” PEPR rating was arbitrary, capricious and without rational basis or foundation is sole basis for reversal of rating. Error in rating calculations is not sufficient to support reversal of rating. In re Padilla, CSA 25-06, p. 11 (9/13/06), affirmed In re Padilla, CSB 25-06 (2/15/07); See also In re Macieyovski, CSA 62-06, 3 (12/14/06).  

PEPR rating was arbitrary, capricious, and without rational basis or foundation where deficiencies noted in PEPR were not clearly related to performance standards set in the PEP, PEPR was fraught with mathematical errors and procedural problems, and convincing evidence was presented that supervisor actively disliked appellant. In re Padilla, CSA 25-06, 1 (9/13/06).

Agency may not discipline an employee both for engaging in and, at the same time, failing to engage in the same conduct. In re Martinez, CSA 69-05, 3 (1/4/06) (decided under former §16-50 A. 1).

Agency neglected to use reasonable diligence to determine whether laid-off employee possessed the qualifications to perform the essential duties of the demotional appointment, gave undue weight to its own interpretation of the nature of the position, and disregarded more objective evidence, thereby exercising its discretion in an arbitrary and capricious manner. In re Romberger, CSA 89-04, 9-12 (3/2/05), citing Lawley v. Dept. of Higher Education, 6 P.3d 1239, 1252 (Colo. 2001).

An act is arbitrary and capricious if a reasonable person, considering all the evidence in the record, would fairly and honestly be compelled to reach a different conclusion. In re Leal-McIntyre, CSA 77-03, 134-03 & 167-03, 5 (1/27/05), citing Wildwood Child & Adult Care Program, Inc. v. Colo. Dept of Public Health Care and Environment, 985 P.2d 654, 658 (Colo. App.1999).

 
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