author: PER CURIAM.

text:
    In re PETITION FOR DISCIPLINARY ACTION AGAINST Louis B. OBERHAUSER, Jr., a Minnesota Attorney, Registration No. 80408.
    No. C9-93-1342.
    Supreme Court of Minnesota.
    May 13, 2004.

      Kenneth L. Jorgensen, Director, Office of Lawyers Professional Responsibility, Timothy M. Burke, Senior Assistant Director, St. Paul, MN, for petitioner.
    Jack Neveaux, Wayzata, MN, for Respondent.
   OPINION

PER CURIAM.

Louis B. Oberhauser, Jr., an attorney licensed to practice in Minnesota, was convicted in United States District Court of two counts of felony money laundering. Following the Eighth Circuit’s review on appeal and the district court’s subsequent imposition of sentence, the Director of the Office of Lawyers Professional Responsibility petitioned for disbarment. A referee found that Oberhauser’s conduct violated Minnesota Rules of Professional Conduct 8.4(b) and (c) and recommended disbarment. Oberhauser does not dispute that his conduct violated the rules, but argues that the disciplinary sanction for his misconduct should be less than the recommended disbarment or the alternative possibility of indefinite suspension. Following a thorough review of the record, we eon-elude that the appropriate sanction for Ob-erhauser’s misconduct is disbarment.

In January 1996, Louis B. Oberhauser, Jr., an attorney duly licensed to practice law in the state of Minnesota, became acquainted with Richard Gravatt and Joe King. Following a meeting, Oberhauser agreed to Gravatt and King’s request that Oberhauser’s law office be the disbursing agent for their investment business. Ob-erhauser also agreed to represent Gravatt and King in several real estate transactions. Oberhauser eventually helped Gra-vatt and King incorporate an entity named “K-7,” through which the two men conducted their investment business. In addition, at the request of Gravatt and King, Oberhauser opened an additional trust account at a larger bank than the one where his firm’s existing trust account was held. He did this in order to accommodate K-7’s international money market activities. Oberhauser used this additional trust account exclusively for K-7 transactions.

Gravatt and King subsequently asked Oberhauser to run an investment trading program. The program was described by the United States Court of Appeals for the Eighth Circuit as follows:

[the] trading program was a “roll program” in which the company would supposedly trade $100 million in treasuries making a small percentage on every trade, which through a multiplication factor would yield a large income. Gra-vatt said the Treasury bills could not be leased until the company had $5.5 million in investment money. According to cash investment sheets provided to investors, the $5.5 million total investment would be used to lease $100,000,000 in Treasury bills, and trades on those bills would yield $2,000,000 per trade and $900,000 per trade to investors, with a weekly amount to investors of $3,600,000. Rental fees of $13,750,000 and a set up fee of $3,000,000 would be paid. For a participant investing $50,000 towards the $5.5 million, the total treasury amount would be $909,091, the yield per trade would be $18,182, the yield per trade to [the] investor would be $8[,]182, the weekly amount to the investor would be $28,459, and the net amount to the investor would be $1,166,818. At trial, the Government’s expert witness testified the program’s claims amounted to a preposterous 2000% return. To make the program attractive to employees and investors, profits from the trading program were to go to the charity ChildHelp.

United States v. Oberhauser, 284 F.3d 827, 830 (8th Cir.), reh’g and reh’g■ en banc denied, cert. denied, 537 U.S. 1071, 123 S.Ct. 671, 154 L.Ed.2d 565 (2002). The record does not clearly indicate what specific knowledge Oberhauser had about this program. Oberhauser stated that he told Gravatt and King he would not run the program, but he was willing to act as an escrow agent to receive and distribute the program’s funds. Oberhauser drafted an escrow agreement, a letter of authorization to act on behalf of investors, and an agreement of procedures. He began receiving funds from investors into his K-7 trust account, but had no other contact with investors.

According to the Eighth Circuit’s review of the evidence submitted at Oberhauser’s federal trial, his involvement with K-7 during 1996 took various forms in addition to acting as an escrow agent. In April 1996, Gravatt promised Oberhauser 1% of any deal if Oberhauser helped arrange a standby letter of credit in the amounts of $9, $18, or $27 million. Oberhauser, 284 F.3d at 830. In August 1996, Gravatt and King discussed with Oberhauser the preparation of an employment “termination contract” for a woman hired by K-7 to be Gravatt’s girlfriend. Id. at 830-31. That same month, Oberhauser prepared a letter related to K-7’s attempt to buy a $10 million office building. Id. at 831. In the fall of 1996, a K-7 employee overheard Gravatt and King discuss that Oberhauser “was going to ‘make $20 million on this deal,’ and later asking Oberhauser what he was going to do with all those millions.” Id. The record shows that Oberhauser redrafted contracts related to a $2.5 million investment by an individual named Gordon Groves. Id. It further shows Oberhauser transfeiTed funds from the K-7 trust account for leasing Treasury bills and transferred the funds directly to K-7. Id. After the Treasury bill lease was settled and Groves released $2.5 million to the K-7 trust account, Oberhauser transferred $2.4 million as a broker’s commission to K-7, as well as another $100,000 to K-7. Id.

On August 27, 1996, King contacted Ob-erhauser and told him that he had made an agreement with a charity named Chil-dHelp to fund the construction of a gymnasium in Beaumont, California. ChildHelp is a national charity with its main focus in the area of child abuse prevention and treatment. King wanted to put $160,000 in escrow until the gymnasium was completed and, as a result, $160,000 from K-7’s corporate account, which operated under the name Group Resources, was deposited in the K-7 trust account. On November 25, at the request of ChildHelp, Oberhauser transferred the $160,000 to ChildHelp’s bank account in California.

Ultimately, investors in K-7’s program lost over $11 million.. Oberhauser, 284 F.3d at 829. The federal government indicted Gravatt, King, and four others on 89 counts of criminal conduct, including conspiracy, wire fraud, money laundering, and conducting a continuing financial crime enterprise. Id. On January 6, 2000, Ober-hauser was added as a criminal defendant in a superseding indictment. He was charged with 66 counts, including conspiracy, wire fraud, mail fraud, and money laundering. Oberhauser and Gravatt were the only defendants in this matter to plead not guilty and they were tried jointly in federal district court. Id. at 829. At trial, an Internal Revenue Service (IRS) agent testified that the transfer of the $160,000 to ChildHelp was money laundering because it made the money appear to be the proceeds of a successful deal. Id. at 831. Gravatt was found guilty by a jury, convicted on 68 counts, and sentenced to 262 months in federal prison. Id. at 829. Ob-erhauser was found guilty by the jury and convicted on two counts of money laundering in violation of 18 U.S.C. § 1956(a)(1)(A)® (2000) for the Chil-dHelp transfers, but was acquitted on the other 64 counts. Id.

The district court granted Oberhauser’s subsequent motion for acquittal on both counts on the ground that the convictions were not supported by the evidence. United States v. Oberhauser, 142 F.Supp.2d 1118, 1130-31 (D.Minn.2001). On appeal, the Eighth Circuit reversed. Oberhauser, 284 F.3d at 833. After summarizing the evidence against Oberhauser, the circuit court concluded that even if Oberhauser did not know the fraudulent nature of K-7 when he was first retained, “a reasonable jury could find he knew K-7’s program was not legitimate” by the time of the ChildHelp transactions. Id. at 832. The court observed that Oberhauser “was financially motivated to earn attorney’s fees from K-7 and to receive a percentage of any successful deals.” Id. The court also observed that a jury could reasonably find that Oberhauser “was willfully blind because he knew of a high probability that the K-7 program was fraudulent and deliberately avoided learning the truth.” Id. In response to Oberhauser’s claim that the transfer to ChildHelp was a “benign expenditure,” the court stated that the transfer to the charity promoted the fraudulent scheme because K-7 induced investors to give them money “by stating their profits went to charity and by prominently displaying plaques commemorating their contributions * * Id.

At sentencing after remand, the district court granted Oberhauser a sentencing guidelines role reduction because of his limited participation in K-7’s scheme, but denied a reduction for acceptance of responsibility and found an abuse of trust because the ChildHelp transactions were used to lull investors into a sense of security. The court stated that Oberhauser’s responsibility was “not to blindly follow Mr. King’s advice,” especially when he knew of his own lack of knowledge regarding securities. Nevertheless, the court granted Oberhauser’s motion for a downward sentencing departure. The court sentenced Oberhauser to two 15 month concurrent terms of imprisonment, two concurrent two-year terms of supervised release, 400 hours of community service, and ordered him to pay $160,000 in restitution.

Following the Eighth Circuit’s reinstatement of Oberhauser’s convictions, the Director of the Office of Lawyers Professional Responsibility initiated disciplinary proceedings against Oberhauser. The Director alleged that Oberhauser’s conduct violated Minn. R. Prof. Conduct 8.4(b) and (c). “It is professional misconduct for a lawyer to: * * * (b) commit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects; (c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation * * Minn. R. Prof. Conduct 8.4(b) & (c). On July 14, 2003, we temporarily suspended Oberhau-ser from the practice of law.

On September 12, 2003, a hearing was held before a referee we appointed to make findings of fact and recommendations for disposition of the matter. At the hearing, Oberhauser testified regarding his background and the events related to his convictions. He described his civic involvement as a Rotary Club member and officer and as a former mayor of Orono, Minnesota. He also described his service on his church’s parish council and his membership with and service as an officer of the Wayzata Country Club. Oberhauser testified that several documents regarding the ChildHelp transactions were not offered at his trial and he speculated that the outcome might have been different had these documents been used. Oberhauser testified that he did not receive any personal benefits from the K-7 investment activities, but acknowledged that he billed K-7 $130,000 for legal work and collected $80,000 of this amount. Two character witnesses appeared on Oberhauser’s behalf. Oberhauser also submitted copies of more than 140 letters of support that family members, friends, and acquaintances had sent to the district court prior to sentencing.

The Director presented evidence that Oberhauser has been disciplined on five prior occasions. On June 22, 1988, Ober-hauser was admonished for failing to promptly transfer his clients’ file to their new attorney. On August 11, 1988, he was placed on private probation for two years for neglecting client matters and failing to keep his clients informed of the status of those matters. On December 2, 1993, he was publicly reprimanded for obtaining payment for the release of an invalid lien that he had placed on his client’s homestead for work billed in 1973. In re Oberhauser, 508 N.W.2d 521 (Minn.1993). On March 2, 1995, Oberhauser was admonished for failing to respond to multiple discovery requests in a title registration proceeding, failing to communicate with a client, and failing to return an abstract to a client for six months. On July 2,1998, we suspended Oberhauser from the practice of law for 90 days for misrepresentations to the IRS, the Minnesota Department of Revenue, and the Director of the Lawyers Professional Responsibility Board; backdating a tax return; and failing to timely file federal and state tax returns. In re Oberhauser, 581 N.W.2d 309, 310 (Minn.1998). We reinstated Oberhauser on November 4, 1998. In re Oberhauser, 585 N.W.2d 790, 790 (Minn.1998).

Following the hearing, the referee concluded that Oberhauser’s conduct violated Minn. R. Prof. Conduct 8.4(b) and (c). The referee found three aggravating factors: (1) Oberhauser’s disciplinary history, (2) Oberhauser’s pecuniary motive, and (3) Oberhauser’s substantial experience in the practice of law. The referee noted that Oberhauser’s claim of mitigating factors— evidence of good character and his role in K-7 — did not outweigh the likelihood that he would engage in unethical or illegal conduct in the future. The referee recommended Oberhauser be disbarred or, alternatively, “should the Court find adequate mitigating circumstances,” that Oberhau-ser’s license be indefinitely suspended.

Oberhauser does not contest the conclusion that he violated Rules 8.4(b) and (c). Instead, he focuses on what is an appropriate sanction and suggests that lifting his current suspension from the practice of law following release from prison, followed by two years of supervision, is sufficient discipline. According to Ober-hauser’s brief, he was scheduled for release last month, so his argument is for immediate reinstatement to the practice of law.

In considering a petition for attorney discipline, we do not set aside the findings and conclusions of a referee unless they are clearly erroneous. In re Singer, 541 N.W.2d 313, 315 (Minn.1996). While we place significant weight on the referee’s recommendation for discipline, we have the final responsibility of determining the appropriate discipline to impose. Id. The purposes of disciplinary sanctions for professional misconduct are to protect the public, to protect the judicial system, and to deter future misconduct by the disciplined attorney as well as by other attorneys. In re Daffer, 344 N.W.2d 382, 385 (Minn.1984).

We consider four general factors in determining the appropriate sanction: “1) the nature of the misconduct, 2) the cumulative weight of the violations of the rules of professional conduct, 3) the harm to the public, and 4) the harm to the legal profession.” Singer, 541 N.W.2d at 316 (citing In re Beal, 374 N.W.2d 715, 719 (Minn.1985)). Disciplinary sanctions are imposed on a case-by-case basis after considering both aggravating and mitigating circumstances, as well as looking to similar cases for guidance. In re Koss, 611 N.W.2d 14, 16 (Minn.2000). An attorney’s criminal conviction is “conclusive evidence that the [attorney] committed the conduct for which the [attorney] was convicted.” Minn. R. Lawyers Prof. Resp. 19(a).

Although Oberhauser attempts to minimize his role in K-7, we cannot ignore the presumption created by Rule 19(a) of the Minnesota Rules on Lawyers Professional Responsibility that Oberhauser committed the acts underlying his conviction. See In re Dvorak, 554 N.W.2d 399, 402 (Minn.1996) (holding attorney presumed to have committed the acts underlying a plea of guilty). The criminal act of money laundering for which Oberhauser was convicted involves a specific culpable state of mind. See 18 U.S.C. § 1956(a)(l)(A)(i). Thus, Oberhauser’s conviction for money laundering reflects the jury’s conclusion that Oberhauser both knew the funds were the proceeds of an unlawful activity and intended to promote the unlawful activity via the transaction. Rule 19(a)’s presumption lends itself to the additional presumption that, as here, when the criminal conduct includes a specific state of mind, the conviction is conclusive evidence that the lawyer acted with that state of mind. Therefore, because of Oberhauser’s convictions, we must presume that he both knew that the funds in the ChildHelp transaction were the proceeds of an unlawful activity and that he intended to promote the unlawful activity via the ChildHelp transaction. Moreover, we do not question the Eighth Circuit’s decision affirming the conviction based on a conclusion that the jury could have reasonably found that Oberhau-ser knew of K-7’s fraudulent nature by the time of the ChildHelp transactions and he continued to be a willing participant in the scheme. Oberhauser, 284 F.3d at 832.

The conduct for which Oberhauser was convicted — two counts of felony money laundering — is very serious. At the sentencing hearing, a victim of K-7’s scheme testified that he invested his savings with K-7 only after verifying the reputation and standing of Oberhauser’s law firm in the community. The federal district court found an abuse of trust on Oberhauser’s part because of his role as an attorney in lending legitimacy to K-7’s scheme. Ober-hauser’s involvement with K-7 occurred because of his license to practice law in Minnesota. By knowingly acting to further the criminal activity that eventually cost its victims $11 million, Oberhauser not only contributed to the actual harm suffered, but caused harm to the public’s confidence in and regard for the legal profession.

Moreover, we agree with the referee’s conclusion that Oberhauser’s past history of professional discipline is an aggravating factor. We have held that the cumulative weight and severity of multiple disciplinary rule violations may compel severe discipline even when a single act standing alone would not have warranted such discipline. In re Geiger, 621 N.W.2d 16, 23 (Minn.2001). Here, Oberhauser’s misconduct combined with his disciplinary history warrants disbarment.

Finally, we do not find any mitigating circumstances not considered by the referee, nor do we give those presented by Oberhauser any more weight than did the referee. That Oberhauser has the support of family, many friends, and acquaintances does not outweigh the seriousness of his conduct, his history of failure to abide by the rules of professional conduct, the pecuniary motive underlying his involvement with K-7, and the fact that he was an experienced attorney.

Accordingly, we agree with the referee that disbarment is appropriate and hereby disbar Louis B. Oberhauser, Jr. from the practice of law in the State of Minnesota.

Disbarment ordered.

      . This was an Interest on Lawyers Trust Account (IOLTA). The IOLTA program requires lawyers and law firms to pool nominal and short-term client funds into trust accounts with the interest being paid to the Lawyers Trust Account Board. See Minn. R. Prof. Conduct 1.15(e).

      . For more information, see http://www.chil-dhelpusa.org (last visited May 4, 2004).

      . 18 U.S.C. § 1956. Laundering of monetary instruments.
      (a)(1) Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity;—
      (A)(i) with the intent to promote the carrying on of specified unlawful activity;
      shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both.

      . These documents contain Kang's instruction to Oberhauser to place the $160,000 in an irrevocable trust for ChildHelp, Oberhauser’s communications with ChildHelp regarding the funds, trust account statements, and money transfer documents. Although the documents were among those seized and subpoenaed by the government for the trial, neither the government nor Oberhauser introduced the documents at trial.

      . Oberhauser's only challenge to the referee’s findings and conclusions is contained in a footnote to his brief where he disputes the conclusion that pecuniary motive aggravated his misconduct. Oberhauser suggests that this conclusion is unfounded and erroneous in light of the referee’s finding of fact that Ober-hauser "may have had a pecuniary motive." However, the Eighth Circuit concluded that Oberhauser was financially motivated to earn attorney fees, a percentage from successful deals, and that Oberhauser received $80,000 and was owed another $50,000 in fees from his work for K-7. There is ample evidence to support the referee's finding; therefore, we conclude that this finding is not clearly erroneous.


source: Caselaw Access Project

author: MEYER, Justice.

license: Public Domain

text:
    William Lloyd HUTCHINSON, Appellant, v. STATE of Minnesota, Respondent.
    No. C3-02-1961.
    Supreme Court of Minnesota.
    May 13, 2004.

      Mary M. McMahon, Special Asst. State Public Defender, Roseville, MN, for Appellant.
    Mike Hatch, Attorney General, St. Paul, MN, Amy Klobuchar, Hennepin County Attorney, Michael Richardson, Assistant County Attorney, Minneapolis, MN, for Respondent.
   OPINION

MEYER, Justice.

In this case we are asked to decide whether, under Fiore v. White, 531 U.S. 225, 121 S.Ct. 712, 148 L.Ed.2d 629 (2001) (per curiam), our holding in State v. Misquadace, 644 N.W.2d 65 (Minn.2002), which we expressly applied to pending and future cases, should instead apply from the effective date of an amendment to Minn. Stat. § 244.09 in 1997.

William Hutchinson, the appellant, was charged with third-degree criminal sexual conduct and terroristic threats in connection with an incident involving his girlfriend, who had obtained an order for protection against him. The complaint alleged that on December 11, 2000, he ordered her to drive around Minneapolis, threatened her, forced her to have oral sex, and smashed the stereo and mirror of her car. Hutchinson entered a negotiated plea of guilty to an amended charge of first-degree criminal damage to property in exchange for dismissal of the original charges, and he agreed to a 48-month executed sentence. The agreed-to sentence is a dispositional and durational departure from the presumptive 17-month stayed sentence for an offender with Hutchinson’s criminal history. The district court accepted the plea agreement and, without articulating any additional reasons for departure, imposed the 48-month prison term on April 10, 2001. Hutchinson did not take a direct appeal.

In May 2002, this court decided State v. Misquadace, and held that a plea agreement standing alone is not a sufficient basis to depart from the sentencing guidelines. Misquadace, 644 N.W.2d at 72. The following month, Hutchinson filed a petition for postconviction relief in which he claimed that the Due Process Clause of the Fourteenth Amendment entitled him to the benefit of our decision in Misqua-dace and that he be resentenced. Hutchinson argued that the interests of justice entitled him to a modification of his sentence. The district court denied relief, and the court of appeals affirmed. We granted review on the limited issue whether, under Fiore v. White, our decision in Misquadace represents a clarification of Minn.Stat. § 244.09, as amended in 1997, so as to require that it be prospectively applied from the effective date of the amendment.

In Misquadace we stated:

[Bjecause this holding establishes a new rule of law, retroactive application is not required! Given the purposes to be served, the extent of reliance by the parties and courts on previous standards, and the effect of retroactivity on the administration of justice, prospective application is appropriate. * * * We limit application of the ruling to this case and to pending and future cases.

Misquadace, 644 N.W.2d at 72 (internal citation omitted). We subsequently held that the rule announced in Misquadace applied to a case that was on direct appeal at the time Misquadace was decided. State v. Lewis, 656 N.W.2d 535, 538 (Minn.2003). We reasoned that an appeal suspends a judgment and deprives it of finality, and that the lack of finality continues until the appeal is dismissed or decided. Id. at 537-38. In Lewis, we quoted with approval the Supreme Court’s definition of “final,” for purposes of retroactivity, as “ ‘a case in which a judgment of conviction has b.een rendered, the availability of appeal exhausted, and the time for a petition for certiorari elapsed or * * * finally denied.’ ” Id. at 538 n. 2 (ellipsis in original) (quoting Griffith v. Kentucky, 479 U.S. 314, 321 n. 6, 107 S.Ct. 708, 93 L.Ed.2d 649 (1987)). Under the approach in Lewis, there is no dispute that Hutchinson’s conviction was final long before Misquadace was decided and that if Misquadace established a new rule of law that rule does not apply in Hutchinson’s case.

Hutchinson argues (notwithstanding our express statement in Misquadace that we were establishing a new rule of law) that we merely clarified the intent of the legislature, as expressed in the 1997 statutory amendment, and that because that statute was in effect at the time his conviction became final, under Fiore it applies to him as a matter of due process. The state’s position is that the Misquadace decision was based not on an interpretation of the statute, but on the general principles underlying the sentencing guidelines.

Fiore involved a Pennsylvania statute that criminalized the operation of a hazardous waste facility without a permit. 531 U.S. at 226, 121 S.Ct. 712. Fiore was convicted under the statute even though he possessed a permit, on the ground that he had deviated so dramatically from its terms that he nonetheless violated the statute. Id. at 226-27, 121 S.Ct. 712. After Fiore’s conviction became final, the Pennsylvania Supreme Court interpreted the statute for the first time to make clear that Fiore’s conduct was not within its scope. Id. at 226, 121 S.Ct. 712. The Pennsylvania courts declined to grant Fiore postconviction relief, and on federal habeas corpus review the United States Supreme Court granted certiorari to consider “when, or whether, the Federal Due Process Clause requires a State to apply a new interpretation of a state criminal statute retroactively to cases on collateral review.” Id. Because the Court was uncertain whether the Pennsylvania Supreme Court’s decision represented a new rule of law, it certified the question to the state supreme court. Id. at 226, 228, 121 S.Ct. 712. The Pennsylvania court replied that its ruling “merely clarified the plain language of the statute” and constituted the proper statement of law at the time Fiore’s conviction became final. Id. at 228, 121 S.Ct. 712. The Supreme Court ruled that the response to the certified question “made clear that retroactivity is not an issue” and also made clear that Fiore did not violate the statute and that his conviction violated due process. Id. at 226, 229, 121 S.Ct. 712. See also Bunkley v. Florida, 538 U.S. 835, 123 S.Ct. 2020, 155 L.Ed.2d 1046 (2003) (per curiam) (holding that state supreme court’s determination that change it announced in definition of statutory term had evolved over time supported not applying the decision retroactively, but remanding for determination of due process question whether definitional change had evolved when defendant’s conviction became final).

If we determine that State v. Misqua-dace announced a new rule of law and did not merely serve to clarify the 1997 sentencing statute, then Hutchinson’s conviction will stand. We begin with an examination of the relevant statutory and case law that gave rise to the issue raised in the Misquadace case.

Minnesota Statutes § 244.09, subdivision 5 (2002), authorizes the sentencing guidelines commission to promulgate sentencing guidelines for the district court. This statute makes no reference to sentencing departures. Minnesota Statutes § 244.10 (2002), however, sets out certain procedures to be followed for deviations from the guidelines. No relevant changes in these statutory provisions were made from the time of their first enactment in 1978 until the 1997 amendment to section 244.09, subdivision 5.

In State v. Garcia, 302 N.W.2d 643, 647 (Minn.1981), this court’s first sentencing guidelines decision, we stated that a plea agreement attempting to limit sentence duration did not create a “substantial and compelling circumstance” justifying a departure from the guidelines. We concluded: “Only the court, acting in accordance with the Guidelines, and not the parties, has the authority to determine the appropriate sentence.” Id. Fifteen years later in State v. Givens, 544 N.W.2d 774, 776-77 (Minn.1996), we were asked to establish a rebuttable presumption that if the defendant agrees to a departure as part of a plea bargain, the departure needs no additional justification. We stated that we believed the real question was whether a defendant may waive his or her right to be sentenced under the guidelines. Id. at 777. Noting settled law that courts will honor a defendant’s lawful, intentional relinquishment of a known right or privilege, we held that “defendants may relinquish their right to be sentenced under the guidelines” so long as the waiver was knowing, intelligent, and voluntary. Id. We did not decide whether a plea agreement, standing alone, could justify an upward departure. We also overruled State v. Garcia, to the extent it was inconsistent with this holding. Id. at 777 n. 4.

In 1997, the legislature amended Minn. Stat. § 244.09, subd. 5, by adding the following paragraph:

Although the sentencing guidelines are advisory to the district court, the court shall follow the procedures of the guidelines when it pronounces sentence in a proceeding to which the guidelines apply by operation of statute. Sentencing pursuant to the sentencing guidelines is not a right that accrues to a person convicted of a felony; it is a procedure based on state public policy to maintain uniformity, proportionality, rationality, and predictability in sentencing.

Act of May 6, 1997, ch. 96, § 1, 1997 Minn. Laws 694, 695. In the same act that amended the statute, the legislature (1) prohibited the sentencing guidelines commission from amending the guidelines to include a plea agreement among the factors that should not be used as a reason for departure, and (2) directed the guidelines commission to “study the advisability of allowing a plea agreement to be used as a reason for a departure from a presumptive sentence.” Id. § 11, 1997 Minn. Laws at 702. The act specifically provided that any modification regarding the use of plea agreements for departures would be effective only if the legislature approved it by law. Id. Following these legislative actions, neither the legislature nor the guidelines commission modified the sentencing guidelines to explicitly allow or prohibit a plea agreement standing alone as a departure factor.

In Misquadace we concluded:

We believe that the fairest reading of the 1997 amendment is that the legislature removed whatever “right” to sentencing under the guidelines was provided therein, but that the legislature did not want sentencing pursuant only to a plea agreement to be entirely prohibited until the sentencing guidelines commission analyzed how such sentencing fit within -the entire system.

State v. Misquadace, 644 N.W.2d at 70-71. We also noted that a 1999 amendment to the sentencing guidelines commentary “reflects some ambivalence in its explanation of why plea agreements are a difficult fit.” Id. at 71. We then went on to hold:

We believe that the overriding principle in all sentencing is rationality, predictability, and consistency, and plea agreements can exist within the framework of the sentencing guidelines. Therefore, in order to abide by the guidelines’ overriding principles, we conclude that negotiated plea agreements that include a sentencing departure are justified under the guidelines in cases where substantial and compelling circumstances exist. A plea agreement standing alone, however, does not create such circumstances in its own right.

Id. Finally, we recognized that the effect of our holding could discourage plea agreements and stated:

It is for the legislature, however, to make the policy decision that sentencing pursuant to plea agreements alone does not seriously threaten the goal of rational and consistent sentencing. Until then, we will require courts to articulate substantial and compelling circumstances other than a plea agreement when departing from the guidelines.

Id. at 71-72.

The Misquadace opinion and the legal context in which that case was decided are easily distinguished from Fiore, a ease in which the court was merely clarifying the plain language of a criminal statute. The Misquadace holding was not based on an interpretation or clarification of Minn.Stat. § 244.09, subd. 5. We ruled as we did explicitly “in order to abide by the guidelines’ overriding principles” of “rationality, proportionality, and consistency.” Misquadace, 644 N.W.2d at 71. Indeed, we stated that these overriding principles apply in “all sentencing.” Id. (emphasis added). Further, we stated that it is for the legislature to make the policy determination that sentencing pursuant to plea agreements does not threaten these goals, but until then we will require courts not to impose sentencing departures based on a plea agreement alone. Id. at 71-72.

Minnesota Statutes § 244.09, subdivision 5, as noted earlier, does not refer to sentencing departures, much less address the question whether a plea agreement is an appropriate justification for departure. Although the legislature in the 1997 amendment stated for the first time that sentencing under the guidelines is based on “state public policy to maintain uniformity, proportionality, rationality, and predictability in sentencing,” these principles have been part of the guidelines’ “Statement of Purpose and Principles” since their inception. Minnesota Sentencing Guidelines I. These principles, not the language of the 1997 amendments, provided the basis for the rule of law we announced in Misquadace.

We therefore conclude that the holding in State v. Misquadace was not based on an interpretation or clarification of Minn. Stat. § 244.09, subd. 5, but rather, as we stated then, established a new rule of law. Because we limited application of our holding to pending and future cases, the holding does not apply to Hutchinson’s conviction, which was final before Misquadace was decided.

Affirmed.

      . See Minnesota Sentencing Guidelines cmt. II.D.04. Commentary to the sentencing guidelines is advisory only and not binding on the courts. Asfaha v. State, 665 N.W.2d 523, 526 (Minn.2003).

      . Minnesota Sentencing Guidelines I provides:
      The purpose of the sentencing guidelines is to establish rational and consistent sentencing standards which reduce sentencing disparity and ensure that sanctions following conviction of a felony are proportional to the severity of the offense of conviction and the extent of the offender's criminal history. Equity in sentencing requires (a) that convicted felons similar with respect to relevant sentencing criteria ought to receive similar sanctions, and (b) that convicted felons substantially different from a typical case with respect to relevant criteria ought to receive different sanctions.
      Minnesota Sentencing Guidelines II.D provides that when departing, the judge should take into substantial consideration the statement of purpose and principles in Minnesota Sentencing Guidelines I. This provision has also been in existence since the guidelines were first promulgated.


author: CRIPPEN, Judge.

text:
    Martin MOREN, as parent and guardian of Remington MOREN, a minor, Respondent, v. JAX RESTAURANT, Appellant, John Doe, et al., Defendants. and Jax Restaurant, defendant and third-party plaintiff, Appellant, v. Nicole Moren, third-party defendant, Respondent.
    No. A03-1653.
    Court of Appeals of Minnesota.
    April 27, 2004.

      Terrance J. Kane Crumley, Minnetonka, MN, for respondent Martin Moren.
    Steven C. O’Tool, Steven C. O’Tool, Attorney at Law, P.A., Edina, MN, for appellant.
    Wilbur W. Fluegel, Fluegel Law Office, Minneapolis, MN, for respondent Nicole Moren.
    Considered and decided by HUDSON, Presiding Judge, WILLIS, Judge, and CRIPPEN, Judge.
   OPINION

CRIPPEN, Judge.

Remington Moren, through his father, commenced a negligence action against appellant Jax Restaurant for injures he sustained while on appellant’s premises. The district court granted a summary judgment, dismissing appellant’s third-party negligence complaint against respondent Nicole Moren, a partner in Jax Restaurant and the mother of Remington Moren. Because the court correctly determined that liability for Nicole Moren’s negligence rested with the partnership, even if the partner’s conduct partly served her personal interests, we affirm.

FACTS

Jax Restaurant, the partnership, operates its business in Foley, Minnesota. One afternoon in October 2000, Nicole Moren, one of the Jax partners, completed her day shift at Jax at 4:00 p.m. and left to pick up her two-year-old son Remington from day care. At about 5:30, Moren returned to the restaurant with Remington after learning that her sister and partner, Amy Bene-detti, needed help. Moren called her husband who told her that he would pick Remington up in about 20 minutes.

Because Nicole Moren did not want Remington running around the restaurant, she brought him into the kitchen with her, set him on top of the counter, and began rolling out pizza dough using the dough-pressing machine. As she was making pizzas, Remington reached his hand into the dough press. His hand was crushed, and he sustained permanent injuries.

Through his father, Remington commenced a negligence action against the partnership. The partnership served a third-party complaint on Nicole Moren, arguing that, in the event it was obligated to compensate Remington, the partnership was entitled to indemnity or contribution from Moren for her negligence. The district court’s summary judgment was premised on a legal conclusion that Moren has no obligation to indemnify Jax Restaurant so long as the injury occurred while she was engaged in ordinary business conduct. The district court rejected the partnership’s argument that its obligation to compensate Remington is diminished in proportion to the predominating negligence of Moren as a mother, although it is responsible for her conduct as a business owner. This appeal followed.

ISSUE

Does Jax Restaurant have an indemnity right against Nicole Moren in the circumstances of this case?

ANALYSIS

On appeal from summary judgment, the reviewing court is to ask whether there are any genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990). In addressing these two questions, we must “view the evidence in the light most favorable to the party against whom judgment was granted.” Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn.1993) (citation omitted). But we are not to defer to the district court’s decision on a question of law. Frost-Benco Elec. Ass’n v. Minn. Pub. Utils. Comm’n, 358 N.W.2d 639, 642 (Minn.1984).

Under Minnesota’s Uniform Partnership Act of 1994(UPA), a partnership is an entity distinct from its partners, and as such, a partnership may sue and be sued in the name of the partnership. Minn. Stat. §§ 323A.2-10, 323A.3-07 and 323A.12-01 (2002). “A partnership is liable for loss or injury caused to a person ... as a result of a wrongful act or omission, or other actionable conduct, of a partner acting in the ordinary course of business of the partnership or with authority of the partnership.” Minn.Stat. § 323A.3-05(a) (2002); see also Bedow v. Watkins, 552 N.W.2d 543, 546 (Minn.1996); Shetka v. Kueppers, Kueppers, Von Feldt, & Salmen, 454 N.W.2d 916, 919 (Minn.1990). Accordingly, a “partnership shall ... indemnify a partner for liabilities incurred by the partner in the ordinary course of the business of the partnership.... ” Minn. Stat. § 323A.4-01(c) (2002). Stated conversely, an “act of a partner which is not apparently for carrying on in the ordinary course the partnership business or business of the kind carried on by the partnership binds the partnership only if the act was authorized by the other partners.” Minn.Stat. § 323A.3-01(2) (2002). Thus, under the plain language of the UPA, a partner has a right to indemnity from the partnership, but the partnership’s claim of indemnity from a partner is not authorized or required.

The district court correctly concluded that Nicole Moren’s conduct was in the ordinary course of business of the partnership and, as a result, indemnity by the partner to the partnership was inappropriate. It is undisputed that one of the cooks scheduled to work that evening did not come in, and that Moren’s partner asked her to help in the kitchen. It also is undisputed that Moren was making pizzas for the partnership when her son was injured. Because her conduct at the time of the injury was in the ordinary course of business of the partnership, under the UPA, her conduct bound the partnership and it owes indemnity to her for her negligence. Minn.Stat. §§ 323A.3-05(a) and 323A.4-01(c).

Appellant heavily relies on one foreign case for the proposition that a partnership is entitled to a contribution or indemnity from a partner who is negligent. See Flynn v. Reaves, 135 Ga.App. 651, 218 S.E.2d 661 (1975). In Flynn, the Georgia Court of Appeals held that “where a partner is sued individually by a plaintiff injured by the partner’s sole negligence, the partner cannot seek contribution from his co-partners even though the negligent act occurred in the course of the partnership business.” Id. at 663. But this case is inapplicable because the Georgia court applied common law partnership and agency principles and, like appellant, makes no mention of the UPA, which is the law in Minnesota.

Appellant also claims that because Nicole Moren’s action of bringing Remington into the kitchen was partly motivated by personal reasons, her conduct was outside the ordinary course of business. Because it has not been previously addressed, there is no Minnesota authority regarding this issue. But there are two cases from outside of Minnesota that address the issue in a persuasive fashion. Grotelueschen v. Am. Family Ins. Co., 171 Wis.2d 437, 492 N.W.2d 131, 137 (1992) (An “act can further part personal and part business purposes and still occur in the ordinary course of the partnership.”); Wolfe v. Harms, 413 S.W.2d 204, 215 (Mo.1967) (“[E]ven if the predominant motive of the partner was to benefit himself or third persons, such does not prevent the concurrent business purpose from being within the scope of the partnership.”). Adopting this rationale, we conclude that the conduct of Nicole Moren was no less in the ordinary course of business because it also served personal purposes. It is undisputed that Moren was acting for the benefit of the partnership by making pizzas when her son was injured, and even though she was simultaneously acting in her role as a mother, her conduct remained in the ordinary course of the partnership business.

The district court determined, and appellant strenuously disputes, that Amy Be-nedetti authorized Nicole’s conduct, or at least that her conduct of bringing Remington into the kitchen was not prohibited by the rules of the partnership. Because under Minnesota law authorization from the other partners is merely an alternative basis for establishing partnership liability, we decline to address the issue of whether Nicole Moren’s partner authorized her conduct.

DECISION

Because Minnesota law requires a partnership to indemnify its partners for the result of their negligence, the district court properly granted summary judgment to respondent Nicole Moren. In addition, we conclude that the conduct of a partner may be partly motivated by personal reasons and still occur in the ordinary course of business of the partnership.

Affirmed.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.

      . As stated earlier, under Minn.Stat. § 323A.3-05 a "partnership is liable for loss or injury caused to a person ... as a result of a wrongful act ... of a partner acting in the ordinary course of business of the partnership or with authority of the partnership.” And under Minn.Stat. § 323A.4-01(c) a partnership must indemnify a partner for liabilities incurred by the partner in the ordinary course of the business of the partnership.


author: MINGE, Judge.

text:
    STATE of Minnesota, Respondent, v. Lance Howard JOHNSON, Appellant.
    No. A03-1385.
    Court of Appeals of Minnesota.
    May 4, 2004.

      Mike Hatch, Attorney General, St. Paul, MN and Kathleen Heaney, Sherburne County Attorney, Arden Fritz, Assistant County Attorney, Elk River, MN, for respondent.
    Stephen V. Grigsby, Minneapolis, MN, for appellant.
    Considered and decided by SHUMAKER, Presiding Judge; KALITOWSKI, Judge; and MINGE, Judge.
   OPINION

MINGE, Judge.

Appellant challenges the revocation of his probation on the grounds that hearsay and illegally obtained evidence were improperly admitted, that the record does not support revocation, and that a continuance was improperly granted. Because the district court did not err in admitting certain evidence or abuse its discretion in revoking probation or granting the continuance, we affirm.

FACTS

On July 2, 2001, appellant Lance Howard Johnson was sentenced in Sherburne County to two years of probation for a gross misdemeanor driving while impaired (DWI). The conditions of probation were that he not consume alcoholic beverages, that he obey the law, that he participate in and complete a chemical-dependency program, including aftercare, and that he view a four-hour Mothers Against Drunk Driving (M.A.D.D.) victim impact program. Johnson was originally placed under the supervision of Sherburne County Probation Officer Joseph Seminari. This probation was later transferred to Probation Officer Todd Schmatz in Mille Lacs County, appellants county of residence.

On March 16, 2003, Police Officer Benjamin Zawacki stopped Johnson in Mille Lacs County for allegedly failing to yield the right of way. In questioning Johnson after the stop, Officer Zawacki noted that Johnson appeared intoxicated and administered a breath test, which showed that Johnson had a blood alcohol concentration of .177. Johnson admitted to Officer Za-wacki that he had been drinking. He was arrested and charged with second-degree DWI and failure to yield the right of way.

On March 18, 2003, Mille Lacs County Probation Officer Schmatz wrote a letter to Sherburne County stating that Johnson had violated the terms of his probation because Johnson’s file did not indicate that he had completed outpatient treatment or attended the M.A.D.D. program and because he had been charged with another DWI offense. Sherburne County then filed a probation violation report with the Sherburne County District Court stating that Johnson had (1) used alcohol; (2) broken the law; (3) not provided evidence that he had completed the outpatient chemical-dependency program; and (4) not provided evidence of attendance at the M.A.D.D. victim impact program.

At the first probation revocation hearing in June 2003, the Sherburne County District Court allowed Officer Seminari to testify about the contents of Officer Schmatz’s letter regarding Johnson’s violation of probation conditions (3) and (4). Johnson stipulated that he had failed to complete the aftercare program but objected to the admission of Officer Schmatz’s letter and to Officer Seminari’s testimony on the ground that they were hearsay and denied him the right to confront Officer Schmatz.

The court declined to accept the March DWI complaint as substantive evidence that Johnson had violated probation revocation grounds (1) and (2). The state then requested and was granted a continuance to allow testimony from Officer Zawacki regarding Johnson’s DWI and failure to abstain from use of alcohol. At a subsequent omnibus hearing, the Mille Lacs County District Court determined that there was not adequate evidence to justify the traffic stop, ruled the stop improper, suppressed evidence obtained as a result of the stop, and dismissed the DWI charges.

On September 10, 2003, the Sherburne County District Court probation revocation proceeding resumed to hear testimony from Officer Zawaeki and to consider evidence relating to the now-dismissed DWI stop. The district court ruled that under Minn.Stat. § 626.21 (2002), certain evidence obtained as a result of the illegal stop was inadmissible, including the blood alcohol level and positive tests for cocaine. However, the district court ruled that neither Officer Zawacki’s roadside observations of Johnson’s appearance, including the odor of alcohol, slurred speech, and blurry eyes nor Johnson’s admission to the officer that he had been using alcohol, constituted “property” seized from Johnson and that both were admissible. The district court concluded that based on Officer Zawacki’s testimony, the stipulated failure to complete the chemical-dependency aftercare program, and the letter about the M.A.D.D. program, Johnson had violated the terms of his probation and that probation was revoked. The district court considered the admission by Johnson that he had been consuming alcohol a close call and stated that the admission was not necessary to support its probation revocation. Johnson challenges the district court’s continuance to allow the testimony of Officer Zawaeki and argues that the district court improperly admitted hearsay and illegally obtained evidence from the traffic stop.

ISSUES

1. Is the probation officer’s letter stating that there was no record of Johnson’s completion of the conditions of probation admissible in the probation revocation hearing?

2. Are the police officer’s observations from an illegal traffic stop admissible in the probation revocation hearing?

3. Did the district court abuse its discretion in revoking probation?

4. Did the district court abuse its discretion in granting the prosecution a continuance?

ANALYSIS

I.

The first issue we face is whether the probation officer’s letter was inadmissible hearsay evidence. The Confrontation Clause provides that “[i]n all criminal prosecutions, the accused shall enjoy the right ... to be confronted with the witnesses against him.... ” U.S. Const, amend. YI. “The right of confrontation is fundamental under both the federal and state constitutions, and the analysis is the same under both.” State v. Dukes, 544 N.W.2d 13, 19 (Minn.1996).

Hearsay is defined under Minn. R. Evid. 801(c) as “a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” The United States Supreme Court has “consistently held that the [Confrontation] Clause does not necessarily prohibit the admission of hearsay statements against a criminal defendant, even though the admission of such statements might be thought to violate the literal terms of the Clause.” Idaho v. Wright, 497 U.S. 805, 813, 110 S.Ct. 3139, 3145, 111 L.Ed.2d 638 (1990). However, a hearsay statement must be necessary and reliable for it to be admissible without violating the accused’s right of confrontation. Dukes, 544 N.W.2d at 19 (citing Ohio v. Roberts, 448 U.S. 56, 65-66, 100 S.Ct. 2531, 2538-39, 65 L.Ed.2d 597 (1980)). The necessity requirement is met by a showing that the declarant is unavailable. State v. Hansen, 312 N.W.2d 96, 102 (Minn.1981). However, there is no general requirement of unavailability applicable to all hearsay exceptions. In re Welfare of L.Z., C.R.P. and S.L.P., 396 N.W.2d 214, 219 (Minn.1986). The reliability requirement is met if the hearsay statement falls under a “firmly rooted” exception to the hearsay rule. Dukes, 544 N.W.2d at 19 (citation omitted).

Minnesota Rule of Evidence 1101(b)(3) provides that the rules of evidence, other than ones regarding privileges, do not apply to proceedings for revoking probation. There is no settled Minnesota caselaw on the application of hearsay principles to probation revocation hearings, and Johnson urges this court to find that the same rules that apply to other criminal proceedings apply to probation hearings. Other states considering this issue have concluded that hearsay evidence can be admitted in probation revocation hearings. See, e.g., People v. Manzanares, 85 P.3d 604, 610 (Colo.Ct.App.2003) (allowing hearsay evidence when probation officer is subject to cross-examination about proffered hearsay and the defendant has an opportunity to present witnesses and testify on his or her behalf); State v. Verdolini, 76 Conn.App. 466, 819 A.2d 901, 905 (2003) (allowing hearsay evidence in a probation revocation hearing if it is relevant, reliable and probative); Staley v. State, 851 So.2d 805, 807 (Fla.Dist.Ct.App.2003) (allowing hearsay at probation revocation hearings if it is not the sole basis for the violation); Marshall v. Commonwealth, 638 S.W.2d 288, 289 (Ky.Ct.App.1982) (admitting letter on violation of probation conditions without testimony by the authors of the letter because “there is no absolute right to confront witnesses, especially when the reliability of the witnesses ... can be easily ascertained.”).

In line with these cases, we conclude that when the defendant has had ample opportunity to present evidence in a probation revocation proceeding, the rules of evidence do not preclude admission of hearsay evidence, such as a letter reporting that defendant violated the terms of probation. Affording the defendant the opportunity to present evidence ensures that the defendant can expose potential flaws in the evidence. The reliability of the hearsay evidence will be weighed against other evidence and the risk of relying on untrustworthy hearsay evidence will be greatly minimized.

Here, the letter from Mille Lacs County Probation Officer Schmatz to Sher-burne County was the basis for finding that Johnson failed to attend the M.A.D.D. victim impact program. Two of the alleged violations, use of alcohol and not completing outpatient chemical-dependency treatment, were established by other evidence. Failure to remain law abiding, the last ground for finding a violation, was dismissed by the state. Thus, the eviden-tiary weight of the letter is limited. Johnson argues that Sherburne County Probation Officer Seminari who read the letter had no personal knowledge of the truth of the letter’s contents and that he was denied the right to confront Probation Officer Schmatz or to challenge the probation files maintained in Mille Lacs County.

Officer Seminari was Johnson’s original probation officer and reviewed the probation agreement with him after he was placed on probation on July 2, 2001. Officer Seminari testified to the terms of the probation agreement, including the requirement that Johnson prove attendance at a M.A.D.D. victim impact panel. This requirement was to have been completed by October of 2001. Officer Seminari testified that Officer Schmatz’s letter indicated that Johnson had yet to provide verification of attendance. Johnson’s revocation proceeding started in June 2003, was continued twice, and concluded in September. Between the filing of the probation violation report and the date of Officer Semi-nari’s testimony four months later, Johnson had ample opportunity to place in the record evidence he thought necessary regarding his alleged failure to attend the program. The requirement to attend the program was straightforward. Although Officer Schmatz’s letter was hearsay, the ample opportunity that Johnson had to confront Officer Seminari regarding the terms of the probation agreement eliminate unfairness. We hold that the district court did not err in relying on the letter as evidence that Johnson failed to attend the M.A.D.D. program.

Johnson also argues that the letter from Officer Schmatz does not establish that the violations were intentional and inexcusable as required for revocation. It appears that Johnson had two years to attend the M.A.D.D. program. Due to delays in the revocation proceeding, he also had several months and three probation revocation hearings in the matter to introduce evidence explaining his failure to participate. In situations where there is a simple directive to participate in a program within a reasonable timeframe and evidence that the person ordered to so participate has failed to do so, the lack of an excuse can be inferred from the evidence. Johnson could easily have provided such rebuttal evidence either by his own testimony or through the testimony of another. We reject Johnson’s claim that the inexcusable nature of the violation was not established or that the lack of confrontation so denied him the opportunity to rebut any implication as to prejudice him.

II.

The second issue is whether the district court erred in accepting the testimony of Officer Zawacki regarding Johnson’s consumption of alcohol and Johnson’s admission that he had been drinking. Johnson claims that Officer Zawacki’s testimony on these two matters was not admissible because the Mille Lacs County District Court determined there was no articulable suspicion for Officer Zawacki to stop Johnson and that all evidence obtained as a result of the illegal stop should be suppressed pursuant to MinmStat. § 626.21 (2002).

When this court reviews district court evidentiary rulings, the district court is granted significant discretion and the question is limited to whether the district court clearly and unequivocally erred in its evidentiary judgment. State v. Aubid, 591 N.W.2d 472, 478 (Minn.1999). Whether a statute has been properly construed is a question of law subject to de novo review. State v. Murphy, 545 N.W.2d 909, 914 (Minn.1996).

The United States Supreme Court in Pa. Bd. of Prob. & Parole v. Scott, 524 U.S. 357, 118 S.Ct. 2014, 141 L.Ed.2d 344 (1998) held that the Fourth Amendment exclusionary rule on illegal search and seizures was inapplicable to parole violation proceedings and that the government’s use of evidence obtained in illegal search and seizures does not, in itself, violate the Constitution. Id. at 362, 118 S.Ct. 2014. The Court balanced the costs of excluding reliable, probative evidence in parole revocation proceedings versus the benefits of deterring illegal search and seizures. Scott, 524 U.S. at 363, 118 S.Ct. at 2019. Illegally seized evidence would be barred only in the context where such benefits outweigh the costs. Id.

This court adopted the Scott rationale and applied it to probation revocation proceedings in State v. Martin, 595 N.W.2d 214 (Minn.App.1999), review denied (Minn. Aug. 25, 1999). In Martin, this court both held that there was no material distinction between the parole and probation systems and that there was no deterrence of illegal search and seizures unless officers somehow knew they were arresting people on probation. Id. at 216-17, 219.

However, the Minnesota legislature went beyond any constitutionally required exclusionary rule by enacting the following statute:

A person aggrieved by an unlawful search and seizure may move the district court ... for the return of the property and to suppress the use, as evidence, of anything so obtained on the ground that (1) the property was illegally seized.... If the motion is granted the property shall be restored ... and it shall not be admissible in evidence at any hearing or trial....

Minn.Stat. § 626.21. Johnson argues that the statute is not limited to “property ... illegally seized” but that it includes “anything so obtained,” and that Officer Za-wacki’s observations and Johnson’s admission would be something “so obtained.”

Nothing in the language of the statute indicates that a broad definition of “property” or “anything so obtained” includes the officer’s observation in this case. The word “property” is used six times in the section. Although there are points in the section where some ambiguity could be found as to what type of evidence is inadmissible, an even-handed reading of the statute makes strained an interpretation that is expanded beyond “property.” For this reason, we decline to adopt Johnson’s interpretation to the extent it includes the observations of the officers. The cost of excluding the reliable, probative evidence of the officer’s observations outweighs the benefits of the possible deterrence effect of the illegal search and seizure. There was no proof that Officer Zawacki knew Johnson was on probation when he arrested him.

The district court stated that although Johnson’s statements were admissible, Officer Zawacki’s observations were adequate to find a violation of probation. Although we review de novo the ruling on admission of evidence as a question of law, determining whether the evidence constitutes a violation of probation is a factual matter which we review under the abuse of discretion standard. State v. Austin, 295 N.W.2d 246, 249-50 (Minn.1980). We conclude that the district court did not abuse its discretion in determining that there was adequate evidence that Johnson had violated probation by using alcoholic beverages. We therefore do not need to reach the issue of whether Johnson’s own admissions constitute property under Minn.Stat. § 626.21.

Johnson also argues that the district court’s change of position on the admissibility of his statement prejudiced Mm. Johnson states that because the district court initially ruled his statement was inadmissible, he failed to closely cross-examine Officer Zawacki. We disagree. The district court stated that it found Johnson violated that term of probation based on Officer Zawacki’s observations without relying on Johnson’s self-incriminating statement and we have concluded that basis was adequate.

III.

The next issue is whether the district court abused its discretion in revoking Johnson’s probation. Minn. R.Crim. P. 27.04, subd. 3(2) provides that in a revocation hearing, “[i]f the court finds that a violation of the conditions of probation has not been established by clear and convincing evidence, the revocation proceedings shall be dismissed, and the probationer’s probation continued under the conditions theretofore ordered by the court.” The district court has broad discretion in determining if sufficient evidence exists to revoke probation and should be reversed only for a clear abuse of discretion. Austin, 295 N.W.2d at 249-50. Under Austin’s three-step analysis, the district court must “(1) designate the specific condition or conditions [of probation that were] violated; (2) find that the violation was intentional or inexcusable; and (3) find that the need for confinement outweighs the policies favoring probation.” Id. at 250.

Here, the district court found that the state proved by clear and convincing evidence that Johnson violated three terms of his probation, and there is evidence to support its findings. Johnson stipulated that he failed to complete aftercare following chemical-dependency treatment. The Officer Schmatz letter established that he failed to attend a M.A.D.D. impact panel. Further, Officer Zawacki testified that Johnson had been drinking alcohol.

Secondly, the violations were found to be intentional and inexcusable. The inexcusable nature of the failure to simply attend a program has already been discussed. Johnson’s stipulation that he failed to complete the chemical-dependency program without any claim of extenuating circumstances is similarly an inexcusable violation. Johnson was supposed to complete the terms of his probation by October 2001. Johnson failed to complete the terms and instead was stopped on March 16, 2003. On this record, the district court did not abuse its discretion in finding there was a need for confinement.

Third, Johnson was operating a vehicle after drinMng alcoholic beverages. This was precisely why Johnson was on probation. He failed to complete treatment or to even attend the M.A.D.D. program. These facts support the district courts finding that there was clear and convincing evidence of the violation and that the need for confinement outweighs the policies favoring probation. Therefore, the district court did not abuse its discretion in revoking Johnson’s probation.

IV.

The last issue is whether the district court abused its discretion in granting the state’s motion for a continuance on June 18, 2003. “The decision to grant or deny a continuance lies within the discretion of the [district] court.” State v. Lloyd, 345 N.W.2d 240, 247 (Minn.1984). In determining whether the district court abused its discretion, the reviewing court must consider the circumstances before the district court when the motion was made and whether the defendant was so prejudiced in preparing or presenting a defense that it materially affected the outcome of the trial. Id.

In this case, the district court declined to accept the states use of the March 16, 2003, complaint to prove failure to abstain from the use of alcohol. The court stated that if the state wanted to prove that basis for revoking probation, a witness would be necessary and granted a continuance for the state to bring in a witness. There is no evidence that Johnson was prejudiced in preparing or presenting his defense as a result of the grant of continuance. Officer Zawacki personally appeared and Johnson had the opportunity to cross-examine the officer. We do not find there was an abuse of discretion.

DECISION

The district court did not err in admitting a letter from the probation officer of another county to identify a probation violation or in basing revocation in part on the observations of a police officer at a stop that was later dismissed for lack of articulable suspicion. Finally, the district court did not abuse its discretion in revoking probation or granting the prosecutor a continuance.

Affirmed.

      . We recognize that previous attacks on parole and probation revocation proceedings have been based on due process grounds. See Gagnon v. Scarpelli, 411 U.S. 778, 93 S.Ct. 1756, 36 L.Ed.2d 656 (1973); Morrissey v. Brewer, 408 U.S. 471, 92 S.Ct. 2593, 33 L.Ed.2d 484 (1972). However, the parties argued under the Confrontation Clause and we therefore focus our analysis accordingly.

      . Johnson makes no claim and the record does not indicate that this is a situation where a person known to be on probation is shadowed by law enforcement, the officer stops the person on an unsustainable pretext, and the prosecution uses what the officer saw in the illegal stop to revoke probation.


author: KALITOWSKI, Judge. MINGE, Judge

text:
    Mayor Randy KELLY, Relator, v. CAMPAIGN FINANCE AND PUBLIC DISCLOSURE BOARD, Respondent.
    No. A03-970.
    Court of Appeals of Minnesota.
    May 11, 2004.

      Manuel J. Cervantes, St. Paul City Attorney, Gerald T. Hendrickson, Deputy City Attorney, John H. Stechmann, Assistant City Attorney, St. Paul, MN, for relator.
    Mike Hatch, Attorney General, Gregory P. Huwe, Assistant Attorney General, St. Paul, MN, for respondent.
    Considered and decided by SHUMAKER, Presiding Judge; KALITOWSKI, Judge; and MINGE, Judge.
   OPINION

KALITOWSKI, Judge.

A complaint filed with respondent alleged that relator City of St. Paul Mayor Randy Kelly accepted a gift from a lobbyist principal, in violation of Minn.Stat. § 10A.071 (2002). Following a hearing, respondent found that there was probable cause to believe that relator had violated section 10A.071. Relator challenges respondent’s decision, arguing that he did not violate section 10A.071 because the gift was to the city, it was used for the benefit of the city, and the city council approved the gift pursuant to Minn.Stat. § 465.03 (2002).

FACTS

On April 21, 2003, Jac Sperling and Bob Naegele, two of the owners of the Minnesota Wild hockey team, spoke with Deputy Mayor Dennis Flaherty to invite relator Mayor Kelly to travel with them to game seven of the National Hockey League western conference quarter-final playoff game between the Minnesota Wild and the Colorado Avalanche to be played in Denver the following night. Deputy Mayor Flaherty called Mayor Kelly that night and Mayor Kelly agreed to attend. The next night, Mayor Kelly flew to Denver with Dr. Glen Nelson, an investor in Minnesota Hockey Ventures Group LP, Rose Wild LLC, and Gopher State Ethanol, all of which are lobbyist principals. Sperling, Naegele, and two other Minnesota Wild officials also flew to Denver with Dr. Nelson and Mayor Kelly. Mayor Kelly watched the game from a private suite at the Pepsi Center. After the game, the group immediately returned to Minnesota, arriving at approximately 4:00 a.m. on April 23.

Shortly after returning from the trip, Mayor Kelly proposed a resolution to the St. Paul City Council accepting the gift of air travel and attendance at the game on behalf of the city. On May 7, 2003, the city council considered the resolution at a public meeting and passed it by a two-thirds majority as required under Minn. Stat. § 465.03, finding that “the participation by official City representatives in these events serves the public purpose of supporting and showing commitment to a major asset of Saint Paul, encouraging further development and commitment in Saint Paul, and further enhancing Saint Paul as a place to live, work, and visit.”

On May 28, 2003, two individuals filed a complaint with respondent Campaign Finance and Public Disclosure Board alleging that Mayor Kelly violated Minn.Stat. § 10A.071 (2002), which prohibits a lobbyist principal from giving a gift to a public official and prohibits a public official from accepting a gift from a lobbyist principal. On June 25, 2003, respondent held a hearing and found that there was probable cause to believe that Mayor Kelly had violated section 10A.071. Respondent’s order required Mayor Kelly to reimburse the Wild for all costs of the trip. Mayor Kelly filed a writ of certiorari to this court.

ISSUE

Did relator violate Minn.Stat. § 10A.071 by accepting a gift from a lobbyist principal on behalf of the city?

ANALYSIS

The construction and application of a statute are questions of law, which this court reviews de novo. Benigni v. County of St Louis, 585 N.W.2d 51, 54 (Minn.1998).

Minn.Stat. § 10A.071 (2002) prohibits a public official from accepting a gift from a lobbyist. But Mayor Kelly argues that he did not violate Minn.Stat. § 10A.071 because the trip was a gift to the city, accepted by the city council, and used for a public purpose as provided for in Minn. Stat. § 465.03 (2002):

Any city ... may accept a grant or devise of real or personal property and maintain such property for the benefit of its citizens in accordance with the terms prescribed by the donor.... Every such acceptance shall be by resolution of the governing body adopted by a two-thirds majority of its members, expressing such terms in full.

In making this argument, Mayor Kelly relies on MinmStat. § 465.03 as it was implicitly applied in a 1996 decision of the Ethical Practices Board (EPB): In re Investigation of Belton, No. 398-96 (Minn. Ethical Practices Bd. Jan. 26, 1996). In that case, the EPB determined that Northwest Airline’s provision of airfare to Japan, which was accepted as a gift by the City of Minneapolis and used by Mayor Sharon Sayles Belton, was used by the city for a legitimate public purpose and did not constitute a gift to an official. Id. In addition, the EPB did not find a violation where Honeywell Corp., a lobbyist principal, provided $500 to the city to support the costs of Mayor Belton’s trip, and the city accepted the funds as a gift and deposited the money in the mayor’s contingency fund to be used at the mayor’s discretion. Id.

Here, in its written decision, respondent made no specific reference to Minn.Stat. § 465.03 or to its earlier decision in Belton. In its oral argument to this court, respondent conceded that the gift to Mayor Kelly served a legitimate public purpose that benefited the City of St. Paul and that the only relevant distinction between the facts underlying Belton and the facts here is that in Belton, the city council accepted the gifts before the mayor used them while here, the city council did not accept the gift until after the mayor had returned from the trip.

Mayor Kelly argues that he complied with MinmStat. § 465.03. And the record supports his contentions that: (1) there was not enough time to present the gift to the city council for prior acceptance or to obtain a prior ruling from respondent; (2) Mayor Kelly accepted the gift on the city’s behalf, pending approval from the city council; (3) Mayor Kelly submitted the matter to the city council shortly after returning from Denver; and (4) it was in the best interest of the city for him to accept the gift. And, notwithstanding respondent’s argument, we note that Minn. Stat. § 465.03 is silent on the issue of whether a city council may accept a gift on behalf of the city after a city official has already conditionally accepted the gift. Moreover, section 465.03 confers on cities an extremely broad power of acceptance. Schaeffer v. Newberry, 235 Minn. 282, 290, 50 N.W.2d 477, 482 (1951). The Minnesota Supreme Court has even upheld a gift to a city where there is no evidence that the city ever accepted the gift in accordance with section 465.03. Hous. & Redevelopment Auth. of S. St Paul v. United Stockyards Corp., 309 Minn. 331, 333, 244 N.W.2d 275, 276 (1976).

Mayor Kelly contends that because the City of St. Paul complied with Minn. Stat. § 465.03 and followed Belton as much as practicable, respondent’s decision was fundamentally unfair and violated his right to due process because, in effect, respondent changed its policy without prior notice. We agree. The goal of the Due Process Clause is to prevent the arbitrary and standardless enforcement of laws. State v. Davidson, 481 N.W.2d 51, 56 (Minn.1992). And despite the fact that the facts here closely parallel the facts presented to respondent in issuing Belton, respondent failed to address Belton or Minn.Stat. § 465.03 in its order.

Moreover, although not specifically referenced in its written decision, the record indicates that respondent relied on an advisory opinion that addresses nearly identical facts as presented here and concludes that use of the gift prior to acceptance by the city constitutes a violation of Minn. Stat. § 10A.071. Op. Campaign Fin. & Pub. Disclosure Bd. 348 (May 28, 2003) (Advisory Opinion 348). But importantly, that opinion was issued after Mayor Kelly returned from the trip and after the gift was accepted by the St. Paul City Council. Thus, it was ineffective to put Mayor Kelly on notice of a policy change. In addition, Minn.Stat. § 10A.02, subd. 12a (2002), does not allow respondent to apply advisory opinions more broadly than to the individual to whom the opinion was issued unless the opinion is adopted as a rule.

Contrary to respondent’s claims, the record indicates that it improperly relied on Advisory Opinion 348 in reaching its decision. The advisory opinion states that “[t]he facts provided for this opinion are insufficient for the Board to conclude whether the use of the plane would be a prohibited gift under Chapter 10A.” And during the Board’s hearing, a board member, in a discussion surrounding whether a lobbyist principal was involved in providing use of the plane to Mayor Kelly, stated that “[t]hat’s information we didn’t have in the advisory opinion.... ” Thus, the record indicates that notwithstanding Minn.Stat. § 10A.02, subd. 12a, respondent issued the advisory opinion with this specific case in mind and relied on it in reaching its decision.

We recognize that in the future respondent has the authority, through appropriate decisions or rulemaking, to interpret Minn.Stat. § 10A.071 and determine how the ban on gifts interacts with Minn.Stat. § 465.03. And we recognize that prior use of a gift, as occurred here, may raise the appearance of impropriety. But we conclude that on this record it was fundamentally unfair for respondent to depart from the reasoning in Belton and apply a new interpretation after-the-fact to Mayor Kelly’s actions. Because the City of St. Paul complied with MinmStat. § 465.03 and because the facts here are similar to the facts of Belton, we conclude that respondent’s determination that Mayor Kelly violated Minn.Stat. § 10A.071 was arbitrary and in violation of Mayor Kelly’s right to due process.

DECISION

The requirements of Minn.Stat. § 465.03 were met when the St. Paul City Council found a public purpose, accepted the gift on the city’s behalf, and appropriated the use of the gift to Mayor Kelly. Mayor Kelly generally complied with respondent’s decision in Belton because neither prior approval of the gift by the city council nor a prior ruling by respondent was possible. Therefore, we conclude that Mayor Kelly did not violate Minn.Stat. § 10A.071 (2002) by conditionally accepting and using the gift on the city’s behalf.

Reversed.

MINGE, Judge

(concurring specially).

I join in the opinion of the court and add this separate concurrence. The parties to this appeal did not litigate whether the travel and other consumable items were property as that term is used in Minn.Stat. § 465.03 (2002) and the opinion does not reach that question.


author: RANDALL, Judge.

text:
    Tara L. BRAY, Relator, v. DOGS & CATS LIMITED (1997), Respondent, Commissioner of Employment and Economic Development, Respondent.
    No. A03-1413.
    Court of Appeals of Minnesota.
    May 11, 2004.

      Kris L. Olen, in association with William M. Mahlum, Mahlum & Associates, P.A., St. Paul, MN, for relator.
    Dogs & Cats Limited, St. Paul, MN, respondent.
    Lee B. Nelson, Katrina I. Gulstad, St. Paul, MN, for respondent Commissioner.
    Considered and decided by HARTEN, Presiding Judge, RANDALL, Judge, and KLAPHAKE, Judge.
   OPINION

RANDALL, Judge.

Relator Tara Bray challenges the decision of the commissioner’s representative that she was discharged for employment misconduct, disqualifying her from receiving unemployment benefits. Because the record shows that relator’s actions fell under the “simple unsatisfactory conduct” exception to the definition of employment misconduct, we reverse.

FACTS

Relator Tara Bray began work at Dogs and Cats Limited (DCL) as a sales associate in the Mall of America store in 2000. In January 2002, relator was promoted to the position of store manager. At first, relator did well in her new position. But gradually, her performance deteriorated, she did not meet expectations, and intervention by higher management was required.

At times, relator turned in required paperwork late, failed to correct overstaffing problems, and failed to perform other managerial tasks to the employer’s satisfaction. Although she had previously been urged to correct some of these problems, relator did not, and on January 2, 2003, one of DCL’s regional managers, Brooke Buysse, issued a “corrective counseling” to relator, stressing the importance of completing all tasks in a timely and professional manner, and arranging some additional training for relator with another store manager.

Even after the corrective counseling, however, relator’s performance was sporadic, and on March 31, 2003, Buysse approached relator to inform hep that her employment would be terminated. Buysse said that she “didn’t think that this was a good fit” and that it seemed “that [relator] wasn’t meeting the expectations ... [j]ust basic policies and procedures and basic expectations they just weren’t being met.” After the termination, relator applied for unemployment benefits, and received them. DCL appealed, and the matter was heard before an unemployment law judge. Buysse argued that relator was consistently late in performing a number of her duties, despite being warned about timeliness. He said relator often overstaffed her store, violating the company’s payroll limits, even after being warned about over-staffing. Finally, Buysse said that relator violated a direct order from Buysse to issue a written warning to an employee who was seen in or around the DCL store before his shift was to begin.

Relator testified that she tried to perform her duties to the best of her ability, but sometimes did not understand what was required of her or was not aware that her actions would not satisfy the employer’s standards. Relator said she refused to issue a written warning to the early-arriving employee because the man was African-American, and she felt that Buysse’s request to discipline him might have had racial motivations. Relator went so far as to contact an attorney about the issue, and did orally direct the employee to stay away from the store until no more than 10 minutes before his shift. Relator thought this was enough to handle the problem.

The unemployment law judge found that relator’s conduct constituted an intentional disregard of the employer’s expectations, and disqualified her from receiving unemployment benefits. The commissioner’s representative affirmed the disqualification, and this certiorari appeal follows.

ISSUES

I. Does the record support the conclusion that relator committed employment misconduct that disqualifies her from receiving unemployment benefits?

II. Should this court apply the amended version of Minn.Stat. § 268.095, subd. 6(a), to the facts of the case?

ANALYSIS

I. Misconduct

On appeal, “we review the commissioner’s factual findings in the light most favorable to the commissioner’s decision and will not disturb them as long as there is evidence that reasonably tends to sustain those findings.” Schmidgall v. FilmTec Corp., 644 N.W.2d 801, 804 (Minn.2002). But, the commissioner’s conclusions “are not binding upon this court if they do not have reasonable support in the findings.” Marty v. Digital Equip. Corp., 345 N.W.2d 773, 775 (Minn.1984).

An employee can commit misconduct by refusing to comply with an employer’s reasonable requests and policies. See McGowan v. Executive Express Transp. Enters., Inc., 420 N.W.2d 592, 596 (Minn.1988). Disqualifying misconduct is defined as

(1) any intentional conduct, on the job or off the job, that disregards the standards of behavior that an employer has the right to expect of the employee or disregards the employee’s duties and obligations to the employer; or
(2) negligent or indifferent conduct, on the job or off the job, that demonstrates a substantial lack of concern for the employment.

Minn.Stat. § 268.095, subd. 6(a) (2002). We note that subdivision 6(b) specifically states that inefficiency, inadvertence, simple unsatisfactory conduct, or poor performance due to inability or incapacity, are not employment misconduct. Minn.Stat. § 268.095, subd. 6(b) (2002) (emphasis added).

Here, the commissioner found that relator had received warnings that she must improve her performance and adhere to store procedures, but she did not fix the problems. The commissioner also found that relator disobeyed a direct order to issue a written warning to an employee. The commissioner apparently did not find relator’s explanation as to the “written warning” satisfactory. The commissioner ultimately determined that relator’s failure to improve her performance constituted misconduct so as to disqualify her from receiving unemployment benefits. We disagree.

Relator admits that her performance as a store manager did not meet the employer’s expectations. The commissioner’s findings are not clearly erroneous — relator did fail to meet deadlines and to follow store procedures. And relator admits that she did not issue a written warning to an early-arriving employee, despite the order to do so. But her conduct, although arguably “negligent and indifferent,” does not demonstrate a “substantial lack of concern for the employment.” Relator testified that she tried to turn paperwork in on time, and tried to arrange monthly store meetings at a time convenient for store employees. Relator sought legal advice regarding the order to discipline an employee because she felt the order might have been racially motivated. What we glean from the record as a whole is that relator attempted to be a good employee but just wasn’t up to the job and was unable to perform her duties to the satisfaction of the employer. The only reasonable conclusion that this record supports is that relator was discharged for “inefficiency, inadvertence, simple unsatisfactory conduct, [or] poor performance because of inability or incapacity.” That conduct is specifically not disqualifying employment misconduct; the commissioner’s decision is reversed.

II. Retroactivity

In reversing the commissioner’s denial of unemployment benefits to relator, we apply the 2002 definition of employment misconduct found in Minn.Stat. § 268.095, subd. 6(a), rather than the later version of the statute found in 2003 Minn. Laws 1st Spec. Sess. ch. 3, art. 2, § 13, which became effective August 1, 2003.

The definition of “misconduct” has been altered and interpreted in the last several years. See Houston v. Int’l Data Transfer Corp., 645 N.W.2d 144 (Minn.2002) (discussing 1999 amendments to Minn.Stat. § 268.095, subd. 6); Isse v. Alamo Rent-A-Car, 590 N.W.2d 137, 139-40 (Minn.App.1999) (discussing 1997 codification of misconduct definition found in Tilseth v. Midwest Lumber Co., 295 Minn. 372, 204 N.W.2d 644 (1973)), review denied (Minn. Apr. 20, 1999). Minn.Stat. § 268.095, subd. 6(a) has recently been amended to define misconduct as “any intentional, negligent, or indifferent conduct, on the job or off the job, (1) that evinces a serious violation of the standards of behavior the employer has the right to reasonably expect of the employee, or (2) that demonstrates a substantial lack of concern for the employment.” 2003 Minn. Laws ch. 3, art. 2, § 13. This amendment became effective August 1, 2003. See Minn.Stat. § 645.02 (2002) (providing that laws become effective August 1 of the year enacted unless otherwise specified).

Relator here was discharged March 31, 2003, before the amended law became effective. The Department of Employment and Economic Development, in its brief to this court, announced its intention to apply the law in effect at the time of the commissioner’s decision (September 3, 2003), rather than the employee’s date of discharge, to future cases. This is an error of law. An employee’s conduct should be judged against the law in effect at the time of the termination; that is the date that the employer terminated the employee for committing conduct that the employer felt both deprived the employee of the job and the right to unemployment benefits. It is, if you look at it honestly, an unacceptable standard to judge an employee’s conduct by a legislative standard put into place after the conduct happened. It is not fair to hold an employee to a standard of conduct that had not been defined at the time the employee committed the alleged misconduct. It is basic fairness that someone is entitled to notice of what is expected before one can be punished for not doing what is expected.

To the facts in this case, we apply the law in effect at the time of the discharge, the 2002 statute, and its definitions.

For cases arising from conduct that occurred after August 1, 2003, the August 1, 2003 changes will be applied.

DECISION

Relator is not disqualified from receiving unemployment compensation. She was discharged for inefficient, unsatisfactory conduct, and poor performance due to inability, conduct specifically exempted by statute from the definition of disqualifying misconduct.

The 2002 version of Minn.Stat. § 268.095, subd. 6, was the law in effect at the time relator was discharged. Thus, that statute was applied to the facts in this case.

Reversed.