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Button v. Haines Borough

Supreme Court of Alaska

May 29, 2009

Dave BUTTON, Appellant,

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Robert S. Spitzfaden, Gruening & Spitzfaden, APC, Juneau, for Appellant.

Robert P. Blasco, Hoffman Silver Gilman & Blasco, Juneau, for Appellee.

Before : FABE, Chief Justice, EASTAUGH, CARPENETI, and WINFREE, Justices.


EASTAUGH, Justice.


Based on two criminal convictions and complaints from customers and other tour operators, the clerk of the Haines Borough denied Dave Button's 2005 application for renewal of his commercial tour permit. Button appealed to the borough manager, who upheld the denial after conducting an eight-day evidentiary hearing. The borough assembly and the superior court affirmed. Button appeals. We hold that substantial evidence supported five of the manager's seven factual findings; that those five findings were sufficient to justify denial; that the borough did not violate Button's due process rights; and that the denial was not an inappropriately severe sanction. We therefore affirm the superior court order that affirmed the denial of Button's appeal.


The Haines Borough regulates commercial tours, requiring that each operator acquire an annual commercial tour permit.[1] The permits automatically expire each March 1.[2] To renew a permit the operator must apply to the borough clerk.[3] An operator may appeal a renewal denial to the borough manager, the borough assembly, and the superior court.[4]

Dave Button operated commercial tours under permits from the Haines Borough for the 1999 through 2004 seasons. Based on the administrative record, the assembly later noted that the borough received more than eighty-five complaints concerning Button during this time.

When Button applied for renewal in 2004, the borough clerk, Julie Cozzi, was " reluctant[ ]" to renew the permit because of the complaints. She met with Button's wife, Jane Button. The clerk later testified that she admonished Jane at the meeting to " obey the rules and regs" for tour operators, and reviewed the Haines Borough Code (HBC) and the relevant regulations with Jane. The clerk noted the " admonishment" on Button's 2004 renewal application. Button later testified that he was aware of the complaints and this " admonishment." The clerk renewed Button's permit on May 12, 2004.

Between May and August 2004 the clerk learned of additional alleged and established misconduct by Button. He had been convicted of a misdemeanor; violated a borough ordinance; attempted to pressure a Chilkat Cruises fast ferry captain to overload the ferry; committed several violations of Coast Guard regulations involving his catamaran; and committed other violations of the HBC and the Haines Tour Operator Code of Conduct.

In June 2004 the clerk discussed with Button complaints regarding " parking and behavior" at the Port Chilkoot dock. On August 13 the borough's attorney notified Button that the borough was revoking his permit, effective September 15. Button appealed the notice, and the borough suspended the revocation process and allowed Button to operate through the 2004 tour season that ended September 26, 2004.

Per HBC 5.04.050.C, Button's 2004 permit expired on March 1, 2005. On March 9, 2005 the clerk informed Button that she intended

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to deny any application for renewal. On May 1 Button submitted an application to renew his permit. The clerk denied Button's 2005 renewal application on May 19, citing HBC 5.04.070, .120(A)(1), (2), and (3), and .050(C). The clerk gave ten reasons for the denial, including the incidents mentioned above.

Button appealed the clerk's denial to the borough manager, Robert Venables, on June 3. The manager, acting as hearing officer per HBC 5.04.090 and .100, heard testimony over eight days between July 18 and December 7, 2005. [5] Button presented three witnesses and had the opportunity to cross-examine the borough's nine witnesses. The manager issued both an initial decision affirming the clerk's denial and a final decision containing detailed findings and conclusions.

Button appealed to the assembly, which held a hearing on May 18, 2006 and affirmed the denial on June 13, 2006. Button then appealed to the superior court, which affirmed the borough's denial on June 19, 2007.

Button appeals. He argues that the findings were unsupported by substantial evidence, and that any supported findings were insufficient to justify denial. He also contends that there were several due process violations, and that nonrenewal was too severe a sanction.


A. Standard of Review

When the superior court acts as an intermediate appellate court in an administrative matter, we independently review the merits of the administrative decision.[6] Most of the findings and conclusions to be reviewed were made by the manager. Several were made by the assembly.

When reviewing the merits of an agency decision, we apply varying standards of review.[7] The " reasonable basis" test applies to questions of law involving agency expertise, the " substitution of judgment" test applies to questions of law that do not involve agency expertise, and the " substantial evidence" test applies to questions of fact.[8] If the agency's factual findings are supported by substantial evidence, we will affirm the findings.[9] Whether evidence supporting a factual finding is substantial is a question of law that we review de novo.[10]

We review challenges to agency decisions to admit or exclude evidence for abuse of discretion, and will reverse only if the ruling " erroneously ‘ affected the substantial rights of a party.’ " [11]

B. Whether Those Findings Supported by Substantial Evidence Were Sufficient To Affirm Denial of Button's Renewal Permit

Button argues that seven of the manager's findings [12] were unsupported by substantial evidence and that, alternatively, they were insufficient ...

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