40
Argued and submitted June 11, 2019; resubmitted en banc December 16, 2020;
order modified to set aside $5,000 civil penalty, otherwise affirmed May 5, 2021
ALLIED STRUCTURAL,
Petitioner,
v.
CONSTRUCTION CONTRACTORS BOARD,
Respondent.
Construction Contractors Board
108760; A164317
492 P3d 642
Allied Structural petitions for review of an order of the Construction
Contractors Board (CCB) revoking Allied’s construction contractor license and
assessing a civil penalty of $5,000. The CCB issued the order after reviewing
Allied’s owner’s (Koontz’s) conduct while on post-prison supervision for a sexual
abuse conviction and concluding that Allied was unfit for licensure. On review,
Allied challenges, among other things, the CCB’s consideration of Koontz’s convictions in determining whether to revoke Allied’s license and impose a penalty.
Held: The CCB did not err in revoking Allied’s license but erred in imposing
the penalty. As for the license, rather than revoking Allied’s license based solely
on Koontz’s criminal history, it permissibly considered the intervening circumstances of the conviction and their relationship to Koontz’s profession. As for the
penalty, the CCB did not have the statutory authority to impose a civil penalty
based on a determination that a license applicant or licensee is unfit for licensure
on criminal-conviction grounds; Allied did not violate a provision that allowed
the CCB to impose a civil penalty under ORS 701.992.
Order modified to set aside $5,000 civil penalty; otherwise affirmed.
En Banc
Christopher W. Peterman argued the cause for petitioner. Also on the opening brief were Keith D. Ropp and
Christopher W. Peterman, Attorney at Law, P.C. Also on the
reply brief was Christopher W. Peterman, Attorney at Law,
P.C.
Denise G. Fjordbeck, Assistant Attorney General, argued
the cause for respondent. Also on the brief were Ellen F.
Rosenblum, Attorney General, and Benjamin Gutman,
Solicitor General.
Before Egan, Chief Judge, and Armstrong, Ortega, DeVore,
Lagesen, Tookey, DeHoog, Shorr, James, Aoyagi, Powers,
Mooney, and Kamins, Judges.
Cite as 311 Or App 40 (2021) 41
LAGESEN, J.
Order modified to set aside $5,000 civil penalty; otherwise affirmed.
Lagesen, J., filed the opinion of the court in which
Armstrong, Ortega, DeHoog, Shorr, James, Powers, Mooney,
and Kamins, JJ., joined.
Egan, C. J., concurred in part and dissented in part and
filed an opinion in which DeVore, Tookey, and Aoyagi, JJ.,
joined.
42 Allied Structural v. CCB
LAGESEN, J.
Does the Construction Contractors Board (CCB)
have the statutory authority to impose a monetary penalty
when it determines that a license applicant or licensee is
unfit for licensure based on one of the criminal convictions
listed in ORS 701.098(1)(i)? We took this matter into full
court to consider that question because it is an important
one regarding the scope of the power the legislature has conferred on the CCB, and because the answer to it has potentially significant financial consequences for Oregonians
seeking to enter or remain in the construction industry.
Ultimately, we conclude that the legislature has not given
the CCB the authority to impose a civil penalty based on
a determination of unfitness for licensure on criminal-conviction grounds, something that requires a partial reversal in this case.
Some housekeeping is in order. Although the penalty issue is the one that led us to take this matter into full
court, it is not the only issue presented in this proceeding
in which petitioner, Allied Structural (Allied), seeks judicial
review under ORS 183.482 of the CCB’s final order revoking
its construction contractor license and imposing a $5,000
civil penalty. In addition to challenging the penalty, Allied
contends that the CCB made several procedural errors that
require reversal, and also that the CCB made substantive
errors of law in deciding to revoke its license. We therefore
start by addressing Allied’s asserted procedural errors and
challenges to the revocation decision, before addressing the
penalty question that has divided us.
Giving credit where credit is due, and seeing no
need to reinvent the wheel, our ensuing discussion—with the
exception of the recitation of certain facts and the analysis
related to the penalty question—is drawn almost entirely, to
the word, from the opinion prepared by Chief Judge Egan on
behalf of Department Four of this court.
As noted, Allied, an Oregon business trust, seeks
judicial review of an order of the CCB revoking its construction contractor license after determining that Patrick
Koontz, Allied’s owner, majority trustee, and “responsible
Cite as 311 Or App 40 (2021) 43
managing individual” (RMI),1 was not fit for licensure.
While holding a previous license, Koontz had been convicted of sexual abuse and had not notified the CCB. The
CCB revoked Allied’s license and assessed a civil penalty
of $5,000 pursuant to ORS 701.098(1)(i)(E),2 after determining that Koontz’s conduct while on post-prison supervision
for the sexual abuse conviction rendered him and, therefore, Allied, unfit for licensure. ORS 701.102(2)(d).3 Allied
also challenges the board’s assessment of a penalty. We conclude that the CCB did not err in determining that Koontz
and, therefore, Allied, were unfit, and therefore revoking
Allied’s license. The penalty, as we have said, is a different
story.
PROCEDURAL ISSUES
We address first Allied’s challenges to two procedural rulings by the CCB. The CCB referred Allied’s request
for hearing from the notice of license revocation to the Office
of Administrative Hearings (OAH). One month before the
hearing, Allied’s attorney withdrew. Koontz requested to
be recognized as Allied’s authorized representative and
requested a postponement of the hearing. An administrative law judge (ALJ) for the OAH notified Allied that it was
required to appear through counsel or that it would be held
1
ORS 701.091(1) provides that a business licensed by the CCB “must at all
times have at least one responsible managing individual.”
2
ORS 701.098(1)(i)(E) provides:
“The Construction Contractors Board may revoke, suspend or refuse to
issue or reissue a license and the board may assess a civil penalty as provided in ORS 701.992 if the board determines after notice and opportunity
for hearing:
“…
“(i) … that the licensee or applicant, or an owner or officer of the
licensee or applicant has been convicted of one of the following crimes in this
state or an equivalent crime in another state:
“…
“(E) Sexual abuse[.]”
3
ORS 701.102(2)(d) provides that
“[t]he Construction Contractors Board may revoke, suspend or refuse to
issue a license required under this chapter to a business if:
“…
“(d) The board determines that an owner, officer or responsible managing individual of the business is not fit for licensure[.]”
44 Allied Structural v. CCB
in default and that, if it appeared at the hearing through
counsel, the ALJ would consider a postponement.
At the hearing, an attorney appeared by telephone on behalf of Allied but only for the limited purpose of
requesting a postponement or an authorization for Koontz to
appear on behalf of Allied. The ALJ rejected both requests.
The attorney then withdrew. The ALJ declared Allied in
default and determined, after considering the CCB’s evidence, that the CCB had established the bases for revocation of Allied’s license and the penalty. Allied filed exceptions with the CCB’s Appeal Committee, which upheld the
ALJ’s procedural rulings and determined that the CCB had
established the bases for the revocation and penalty.
In its first assignment of error, Allied asserts that
the CCB erred in declining to authorize Koontz, as trustee
and RMI, to represent the business trust. The issue presented is one of statutory construction with respect to three
interrelated statutes that we review for errors of law. Blue
Mountain Alliance v. Energy Facility Siting, 353 Or 465, 475,
300 P3d 1203 (2013); see also ORS 183.482(8)(a) (a court
determines whether an agency “has erroneously interpreted
a provision of law”).
Allied is organized as a business trust under ORS
128.560, which provides:
“A ‘business trust’ is any association, including a real
estate investment trust, engaged in or operating a business
under a written trust agreement or declaration of trust, the
beneficial interest under which is divided into transferable
certificates of participation or shares, other than a trust
engaged solely in exercising the voting rights pertaining to
corporate shares or other securities in accordance with the
terms of a written instrument.”
Under ORS 128.580,
“[e]xcept as otherwise provided in its trust agreement or
declaration of trust, or any amendments thereto, any business trust shall also be subject to the other provisions of
ORS chapter 60 and other rights and duties existing under
the common law and statutes of this state applicable to
domestic and foreign corporations.”
Cite as 311 Or App 40 (2021) 45
ORS 9.320 states the general rule that a party that
is not a natural person, which includes a business trust,
must appear through counsel in a legal proceeding:
“Any action, suit, or proceeding may be prosecuted or
defended by a party in person, or by attorney, except that
the state or a party that is not a natural person appears by
attorney in all cases, unless otherwise specifically provided
by law.”
See Oregon Peaceworks Green, PAC v. Sec. of State, 311 Or
267, 270-72,
810 P2d 836 (1991) (only persons licensed to
practice law may represent corporations and other entities
in court); Marguerite E. Wright Trust v. Dept. of Rev.,
297
Or 533, 536-37,
685 P2d 418 (1984) (holding that, pursuant
to ORS 9.320, a nonattorney may not represent a business
trust). Consistent with that statute, the CCB has adopted
the Attorney General’s model rule for representation at
administrative hearings, which provides:
“Corporations, partnerships, limited liability companies, unincorporated associations, trusts and government
bodies must be represented by an attorney except as provided in OAR 137-003-0555 or as otherwise authorized by
law.”
OAR 137-003-0550(2).4
ORS 701.160(1) creates a statutory exception for
certain entities appearing before the CCB:
“Notwithstanding ORS 9.320:
“A party may appear or be represented by an individual
who is not a member of the Oregon State Bar in a proceeding before the Construction Contractors Board if:
“(a) The party is a corporation and the individual is an
officer of the corporation;
“(b) The party is a partnership, or a limited liability partnership or foreign limited liability partnership as
those terms are defined in ORS 67.005, and the individual
is a partner in the partnership, limited liability partnership or foreign limited liability partnership;
4
The CCB adopted the Attorney General’s Model Rules of Procedure. OAR
812-001-0120.
46 Allied Structural v. CCB
“(c) The party is a limited partnership as defined in
ORS 70.005 and the individual is a general partner in the
partnership;
“(d) The party is a manager-managed limited liability
company as defined in ORS 63.001 and the individual is a
manager of the company; or
“(e) The party is a member-managed limited liability
company as defined in ORS 63.001 and the individual is a
member of the company.”
A business trust is not among the entities listed in ORS
701.160(1) that may be represented before the CCB by a person who is not an attorney.
ORS 701.160(2) provides an additional exception
for forms of business entities that are not described in ORS
701.160(1) but that the CCB allows through administrative
rule to be represented by a person who is not an attorney:
“In addition to parties described in subsection (1) of this
section, the board, by rule, may recognize particular business forms as parties that may appear or be represented
by an individual who is not a member of the Oregon State
Bar in a proceeding before the board. A board rule adopted
under this subsection must identify the business form of
the party and specify the required relationship between
the party and the individual. The board may allow appearance or representation of a party only by an individual who
is a director, officer, partner, trustee, manager or authorized regular employee of the party.”
The CCB has not adopted an administrative rule authorizing business trusts to appear through a person who is not
an attorney. Thus, there is no statutory or administrative
rule exception for business trusts to the general rule that a
business entity must be represented by an attorney before
the CCB.
ORS 128.580 provides that business trusts “shall
also be subject to the other provisions of ORS chapter 60 and
other rights and duties existing under the common law and
statutes of this state applicable to domestic and foreign corporations.” Citing that statute, Allied contends that, because
corporations may be represented before the CCB by officers,
ORS 701.160(1)(a), and business trusts are to be treated as
Cite as 311 Or App 40 (2021) 47
corporations, Koontz, as Allied’s majority trustee, must also
be allowed to represent Allied.
The Supreme Court rejected nearly the identical
argument in Marguerite E. Wright Trust, 297 Or at 536-37,
holding that, although ORS 128.580 provides that a business trust is to be treated as a corporation and may bring
suit in its own name, no statutory provision authorizes an
exception for business trusts to the requirement of ORS
9.320 that an entity be represented by an attorney. The
court held, in effect, that ORS 128.580 does not address the
question of representation. It is up to the CCB to create an
exception to ORS 9.320 for business trusts if it wishes to do
so, and it has not done so. We therefore conclude that the
CCB did not err in determining that Allied could not be represented by or appear through Koontz.5
In its second assignment, Allied asserts that the
CCB erred in rejecting its challenge to the ALJ’s refusal
to allow a postponement of the hearing or a new hearing to
allow Allied to put on evidence of “good cause” for its default.
Whether to allow a postponement or a new hearing was
within the CCB’s discretion. See OAR 137-003-0525.6 We
have reviewed the record and it shows that the ALJ and the
parties engaged in an extensive colloquy concerning Allied’s
reasons for not having an attorney, and that the ALJ considered them in determining that Allied lacked good cause
for a postponement. Additionally, the ALJ offered several
dates for a possible continuance of the hearing but counsel
who appeared for Allied for the sole purpose of requesting a
setover was unwilling to unconditionally commit to a specific date. We conclude from our review of the record that the
ALJ considered Allied’s “good cause” contentions and that
the CCB’s rejection of Allied’s request for a postponement or
a rescheduling of the hearing was within the range of the
5
We reject Allied’s constitutional contentions without discussion.
6
OAR 137-003-0525(2) provides:
“Unless otherwise provided by law, the Office of Administrative Hearings
or assigned administrative law judge may postpone or continue a hearing:
“(a) For good cause; or
“(b) By agreement of the parties and the agency, if the agency is participating in the hearing.”
48 Allied Structural v. CCB
CCB’s discretion. See ORS 183.482(8)(b) (discretionary rulings reviewed for whether agency acted outside the range of
discretion).
MERITS ISSUES
First, some background: In April 2014, Koontz
applied for a contractor’s license for Allied. The application
required disclosure of convictions that had occurred within
five years of the application, ORS 701.046(1)(k)(E). Koontz’s
prior convictions were in 2006, and he therefore did not disclose them. The CCB approved Allied’s license application.
In 2014, Koontz’s parole officer notified the CCB
that Koontz was attempting to use Allied’s license to be in
locations close to children, in violation of supervision conditions. Based on its own investigation, in March 2015, the
CCB initiated this proceeding to revoke Allied’s license. The
CCB alleged that Koontz’s conviction meant that Allied was
unfit for licensure. The CCB further alleged that, in addition
to being unfit for licensure, Allied had failed to use required
contract language, failed to deliver certain required notices,
and failed to retain proof of delivery of required notices, in
violation of specified statutes and CCB rules.
In a proposed order issued by default, the ALJ found
both that Allied was unfit for licensure because of its RMI’s
criminal history and conduct related to that history, and
that Allied in one instance violated ORS 87.093 and OAR
812-012-0130(2) by not retaining proof that it delivered the
notice required by ORS 87.093. The ALJ found that the CCB
had not proved the other alleged violations. The ALJ then
imposed a civil penalty of $5,000 based on the violations of
ORS 87.093 and OAR 812-012-0130(2). The ALJ concluded
that the law did not authorize the imposition of a civil penalty based on the determination that Allied was unfit for
licensure.
Allied appealed to the CCB’s Appeal Committee.
On appeal, the CCB made these findings: In 2001, Koontz,
doing business as Allied Builders, became licensed as a contractor. In 2006, Koontz was convicted of first-degree sexual
abuse, attempted sexual abuse, and public indecency, with
victims who were under the age of 14. Koontz did not notify
Cite as 311 Or App 40 (2021) 49
the CCB of his convictions, as would have been required by
OAR 812-003-0040, and the CCB did not at that time learn
of Koontz’s convictions. In November 2006, Koontz’s license
was suspended for an unrelated matter, and, in 2007, his
license expired.
Koontz served 75 months in prison and one year in
a county jail for his offenses. He was released to post-prison
supervision in 2013, with conditions that he register and
report as a sex offender, enter and complete a sex offender
treatment program, and not have contact with minors under
the age of 18 or come within 500 feet of a school without
written approval of his supervising officer. Because the
parole officer determined that Koontz was pushing the limits of the exclusion zone, it was subsequently expanded to
within 1,000 feet of a school, day care center, or places where
children congregate. Koontz was required to wear a GPS
device to track his movements to ensure that he did not violate the supervision conditions. Records of Koontz’s parole
officer describe Koontz’s frequent attempts to evade those
conditions and his frequent sanctions for violating them.
The CCB found that Koontz had not accepted
responsibility for his crimes, had not completed sex offender
treatment, and had repeatedly sought construction work
within exclusion zones around schools and other areas
where children were present.
The CCB found that Koontz himself was not fit for
licensure under ORS 701.098(1)(i)(E) because Koontz had
been convicted of sexual abuse, and he was not rehabilitated.
The CCB found, further, that Koontz did not have the ability
to refrain from sexually predatory behavior, and that the
sexually predatory behavior substantially related to Allied’s
construction contracting activity. In reaching its conclusion that Koontz was unfit, the CCB cited, as an example,
Koontz’s use of the CCB license “as a means for Koontz to
seek and secure work near schools and day cares and locations where children congregate[.]”7 Citing ORS 701.102(2)(d),
7
The CCB cited, among other examples, Koontz’s failure to complete an
approved sex offender treatment program; “constant submission of requests to
work in the proximity of schools, daycares and other facilities where teens tend
to congregate, resulting in the imposition of exclusionary zones”; refusal to let
his supervisory officer review his job sites; constant requests “to work out of
50 Allied Structural v. CCB
the CCB determined that Koontz, as Allied’s RMI, was not
fit for licensure because of conduct subsequent to his convictions. In light of the failure of Allied’s RMI to meet the standards for fitness, the CCB concluded that Allied also was not
fit to be licensed as a contractor. The CCB’s order was stayed
pending judicial review.
As for the penalty, the CCB withdrew the allegations that Allied violated the statutes and rules governing
the provision and retention of notices and, in so doing, withdrew the allegation on which the ALJ had determined a
penalty was authorized and warranted. The CCB nonetheless retained the civil penalty, stating that it “does not, however, agree with the ALJ that the only basis for imposition
of a penalty in this matter was that relating to the provision
of notices.” Without discussing the text of ORS 701.992 or
its own rule governing the imposition of civil penalties, the
CCB summarily determined that, having found that “the
Respondent has committed the crime of sexual abuse and
that the crime is substantially related to the fitness and
ability of the Respondent to engage in work as a construction
contractor,” it was authorized by “ORS 701.992(1) and (3)”
to impose a civil penalty up to $5,000.
Allied excepted to that conclusion (among others),
arguing that a determination that Allied was “unfit” for
licensure did not constitute a finding of a “violation” of CCB
statutes or rules so as to allow for the imposition of a civil
penalty under the terms of ORS 701.992. The CCB adhered to
its determinations. Addressing the exception to the penalty,
the CCB again elected not to examine the text and context of
ORS 701.992. The CCB also did not examine its own rule governing the imposition of civil penalties. Instead, the CCB reiterated its conclusion that Allied was unfit and then repeated
its conclusory statement that ORS 701.992 authorized it to
impose a civil penalty based on a finding of unfitness.
Challenges to revocation. In its third assignment of
error on judicial review, Allied contends that the CCB erred
in considering Koontz’s 2006 convictions, which occurred
county where his supervisory officers cannot visually monitor him”; and repeated
requests to be able to visit the home of a construction contracting colleague where
children were present even when told “no” on multiple occasions.
Cite as 311 Or App 40 (2021) 51
more than five years before the licensing application, in
determining whether to revoke Allied’s license or impose
a penalty. That issue presents a question of statutory construction that we review for errors of law. Blue Mountain
Alliance,
353 Or at 475.
ORS 701.098 provides, as relevant:
“(1) The Construction Contractors Board may revoke,
suspend or refuse to issue or reissue a license and the board
may assess a civil penalty as provided in ORS 701.992 if the
board determines after notice and opportunity for hearing:
“…
“(i) Consistent with the provisions of ORS 670.280,
that the licensee or applicant, or an owner or officer of the
licensee or applicant has been convicted of one of the following crimes in this state or an equivalent crime in another
state:
“…
“(E) Sexual abuse[.]”
Under ORS 701.098(1)(i)(E), the CCB has discretion to revoke a license if, after notice and an opportunity
for a hearing, it determines that a licensee has been convicted of sexual abuse when, consistent with ORS 670.280,
the conviction renders the licensee unfit for licensure. Allied
notes that, under ORS 701.046(1)(k)(E),8 an applicant for a
contractor’s license need not disclose convictions older than
five years. In Allied’s view, ORS 701.046(1)(k)(E) creates a
five-year limitation on the CCB’s consideration of prior convictions. We reject the contention. ORS 701.098(1)(i)(E) does
not impose a time limit on consideration of a sexual abuse
conviction. The fact that convictions older than five years
need not be disclosed on an application does not mean that
older convictions are irrelevant or not permitted to be considered by the CCB in determining the fitness of a licensee
under ORS 701.102(2)(d) or whether to revoke a license.
8
ORS 701.046(1)(k)(E) requires inclusion on an application of information
concerning “[a] conviction for a crime listed in ORS 701.098(1)(i) entered within
five years preceding the application date.”
52 Allied Structural v. CCB
Significantly, the fact of a conviction, in and of itself,
cannot provide the basis for revocation of a license. In exercising its discretion, ORS 701.098(1)(i)(E) directs the CCB
to do so “[c]onsistent with the provisions of ORS 670.280,”
which in turn requires that, in evaluating the fitness of a
licensee, the CCB view the facts of the conviction and intervening circumstances in the context of the standards for the
particular occupation or profession:
“(2) … a licensing board, commission or agency may
not deny, suspend or revoke an occupational or professional
license solely for the reason that the applicant or licensee
has been convicted of a crime, but it may consider the relationship of the facts which support the conviction and all
intervening circumstances to the specific occupational or
professional standards in determining the fitness of the
person to receive or hold the license. …
“(3) … a licensing board, commission or agency may
deny an occupational or professional license or impose discipline on a licensee based on conduct that is not undertaken directly in the course of the licensed activity, but
that is substantially related to the fitness and ability of
the applicant or licensee to engage in the activity for which
the license is required. In determining whether the conduct is substantially related to the fitness and ability of
the applicant or licensee to engage in the activity for which
the license is required, the licensing board, commission
or agency shall consider the relationship of the facts with
respect to the conduct and all intervening circumstances to
the specific occupational or professional standards.”
ORS 670.280. Similarly, by administrative rule, the CCB
requires:
“In considering whether to revoke, suspend, or refuse
to issue a license pursuant to ORS 701.098(1)(i)(A) - (I), the
agency shall consider whether the applicant’s or licensee’s
criminal conduct is substantially related to the fitness and
ability of the applicant or licensee to engage in construction
contracting.”
OAR 812-005-0280(1).
Thus, the conviction of a crime in and of itself cannot be the basis for the revocation of an occupational license
or for discipline. In determining fitness, the agency must
Cite as 311 Or App 40 (2021) 53
consider the facts supporting the conviction and the intervening circumstances and their relationship to the specific
occupation or profession. ORS 670.280(2) (providing that an
agency may consider the relationship of the facts of the crime
of conviction and all intervening circumstances to specific
occupational standards in evaluating a person’s fitness to
engage in a specific occupation). Additionally, conduct leading to the denial of an application or the imposition of discipline need not have been directed to the licensed activity,
if it is “substantially related to the fitness and ability of the
applicant or licensee to engage in the activity for which the
license is required.” ORS 670.280(3). The conduct’s “substantial relationship” to fitness is to be determined based on
“the relationship of the facts with respect to the conduct and
all intervening circumstances to the specific occupational or
professional standards.”
Id.
The CCB, thus, did not base its decision to revoke
Allied’s license or to impose a penalty solely on Koontz’s sexual abuse conviction. The CCB’s order shows that it considered the circumstances of that conviction, including Koontz’s
failure to report the conviction in connection with the prior
license and his subsequent conduct, to reach the conclusion
that Koontz and, through Koontz, Allied, were not fit to possess a contractor’s license.
The CCB’s determination of unfitness relied on ORS
701.102 and its own administrative rule. ORS 701.102(2)(d)
provides:
“The Construction Contractors Board may revoke, suspend or refuse to issue a license required under this chapter to a business if:
“…
“(d) The board determines that an owner, officer or
responsible managing individual of the business is not fit
for licensure[.]”
The CCB has defined in OAR 812-005-0280(1) what constitutes fitness to engage in construction contracting:
“(a) Fitness to engage in construction contracting
includes, but is not limited to the ability to:
54 Allied Structural v. CCB
“(A) Refrain from violent, threatening, intimidating or
sexually predatory behavior;
“(B) Refrain from dishonest or fraudulent conduct; or
“(C) Be financially responsible.
“(b) Factors to be considered in denying or refusing to
issue or renew a license include, but are not limited to, the
date of the offense and the circumstances of the crime. In
addition, factors relating to rehabilitation, or lack thereof,
as evidenced by intervening events include, but are not limited to: failure to complete the criminal sentence, including
probation or parole; failure to complete court ordered treatment; or failure to pay court ordered restitution.”
The CCB’s findings touched on several of the factors
described in OAR 812-005-0280(1)(a) and (b), focusing primarily on Koontz’s conduct since his release from custody.
The CCB found that, since his release from custody, Koontz
has not accepted responsibility for his crimes or engaged in
sex offender treatment, as required by the conditions of his
release; has refused to charge the GPS monitor that he is
required to wear under the terms of his supervised release
so that his movements can be monitored; and has placed
himself in locations where children were found. The CCB
found that Koontz sought to use Allied’s construction license
as a means to engage in sexually predatory behavior, by
seeking to work near schools and other locations where children would gather, and that he could not refrain from sexually predatory behavior. The CCB did not err in its determination that Allied was not fit for licensure.
Allied contends in its fifth assignment of error
that the CCB’s findings are not supported by substantial
evidence. We have reviewed the record and conclude that
they are. Allied quarrels with inferences drawn by the CCB
in weighing the evidence. For example, the CCB found that
Koontz “refused to attend” sex offender treatment, which was
a condition of his supervised release. Allied contends that
the record shows that Koontz did not “refuse”; rather, he was
“terminated based on a dispute with his provider.” The CCB
could reasonably interpret Koontz’s conduct as a refusal. We
further conclude that the CCB’s findings and inferences are
reasonably supported by the record and support the CCB’s
Cite as 311 Or App 40 (2021) 55
conclusion that Koontz is unfit to be licensed as a construction contractor.9
Challenge to penalty. The remaining question, presented in Allied’s fourth assignment of error, is whether the
CCB has the statutory authority to impose a civil penalty
based on a determination that a license applicant or licensee
is unfit for licensure on the grounds of one of the qualifying
criminal convictions listed in ORS 701.098(1)(i). Our answer
to that question is no.
An agency’s interpretation of the scope of authority
granted to it by a statute, that is, its determination of the
boundaries confining its ability to act, presents a question of
statutory construction. Our review, accordingly, is governed
by ORS 183.482(8)(a), which directs us to examine whether
“the agency has erroneously interpreted a provision of law”
and, if it has, to determine if “a correct interpretation compels a particular action.” As always, a question of statutory
interpretation is a question of law, making our review for
legal error. State v. Werner, 292 Or App 397, 399,
424 P3d
809, rev den,
363 Or 744 (2018).
Before us, Allied advances the same argument that
it made below. Focusing on the words of ORS 701.992, as it
has all along, Allied argues that the plain terms of the statute authorize civil penalties only when a person has violated
a provision of ORS chapter 701 or a CCB rule. Allied further
contends that
“being ‘unfit’ in and of itself is not a violation of ORS chapter 701, and neither is being convicted of a crime (especially
a crime committed prior to licensure). Therefore, because
neither of these things are violations of CCB statutes or
rules in and of themselves, they are not grounds for a civil
9
Allied points out that OAR 812-005-0280(1)(b) provides that the factors
listed in that subsection may be considered in determining whether to “deny[ ]
or refus[e] to issue or renew” a license, not whether to revoke a license; therefore, Allied contends, the only relevant factor to Koontz’s fitness is his ability to
refrain from sexually predatory behavior. The fact that the listed criteria are
among those that may be considered in determining whether to deny or refuse to
issue or renew a license does not preclude the CCB from considering them in a
proceeding to revoke a license. In any event, the CCB also concluded that Koontz
was not able to refrain from sexually predatory behavior, a stand-alone basis for
revocation.
56 Allied Structural v. CCB
penalty. The CCB is simply attempting to use the statute to
punish Allied, not for any violation of actual CCB statutes,
but rather for a crime that its RMI committed before it ever
existed and which it was not required to report.”
As was the case below, the CCB again does not
engage with Allied’s contention regarding the meaning of
the word “violates” or explain how a determination of unfitness for licensure is something the legislature would have
viewed as a “violation” of the statutes and rules governing
construction contracting. Instead, the CCB responds with
these three sentences:
“As noted in the previous response to assignment of
error, ORS 701.098(1) specifically provides that the board
may revoke or ‘assess a civil penalty as provided in ORS
701.992’ if the owner of a licensee has been convicted of
specified crimes. Such a conviction is a violation of a provision of ORS chapter 701 for purposes of the civil penalty
statute, ORS 701.992. The board did not err in imposing a
civil penalty of $5000.”
Although the CCB has not engaged meaningfully
with the text of the relevant statutes throughout these proceedings, we must. Our well-defined role in this instance
is to determine what “the enacting legislature most likely
intended.” Tarr v. Multnomah County, 306 Or App 26, 33,
473 P3d 603 (2020), rev den,
367 Or 496 (2021). And to
determine that meaning, we examine the statutory “text,
in context, and, where appropriate, legislative history and
relevant canons of construction.” Chase and Chase,
354 Or
776, 780,
323 P3d 266 (2014). That analysis here leads to the
conclusion that the legislature did not intend to authorize
the CCB to impose civil penalties based on a determination
that a licensee or license applicant is not fit for licensure due
to one of the convictions listed in ORS 701.098(1)(i).
ORS 701.992(1) provides:
“Except as provided in subsections (4) and (5) of this section, any person who violates any provision of this chapter
or any rule adopted by the Construction Contractors Board
shall forfeit and pay into the General Fund of the State
Treasury a civil penalty in an amount determined by the
board of not more than $5,000 for each offense.”
Cite as 311 Or App 40 (2021) 57
(Emphasis added.) The question for us is whether a person
“violates any provision of this chapter or any rule adopted
by the Construction Contractors Board” when the person
“has been convicted of one of the” offenses listed in ORS
701.098(1)(i) and that conviction bears on the person’s fitness
for licensure in the manner contemplated by ORS 670.280.
Text and context answer that question.
The legislature has not supplied a specific definition
of the word “violates” for purpose of ORS 701.992(1). We generally “assume that the legislature intended to give words of
common usage their plain, natural, and ordinary meaning.”
State v. Clemente-Perez, 357 Or 745, 756,
359 P3d 232 (2015)
(internal quotation marks omitted). The ordinary meaning of
the word “violate” when talking about legal standards is “to
fail to keep: break, disregard <~ the law>.” Webster’s Third
New Int’l Dictionary 2554 (unabridged ed 2002). We are confident that the ordinary meaning is the one the legislature
intended because, in this instance, the legislature has supplied a general definition of the word “violate” for the entirety
of the Oregon Revised Statutes that is consistent with that
ordinary understanding. According to ORS 174.100, “[a]s
used in the statute laws of this state, unless the context or
a specially applicable definition requires otherwise[,] …
‘[v]iolate’ includes failure to comply.” ORS 174.100(11).
Read in the most natural way, then, ORS 701.992
allows for a civil penalty only where a person has been found
to have broken, disregarded, or “fail[ed] to comply” with a
provision of ORS chapter 701 or a CCB rule. But no provision of ORS chapter 701 and no provision of the CCB rules
prohibits a person from having a conviction or from being
unfit, such that a person with the status of having been convicted or being unfit can be said in any ordinary way to have
broken or disregarded a statute contained in chapter 701 or
one of the CCB’s administrative rules. Likewise, no statute
in chapter 701 or CCB rule requires a license applicant or
licensee to be conviction free, such that having a conviction
can be said to be a “failure to comply” with a pertinent statute or rule.
That ORS 701.098(1)(i) gives the CCB the discretion to “revoke, suspend or refuse to reissue a license” based
58 Allied Structural v. CCB
on one of the specified convictions when, “consistent with
the provisions of ORS 670.280,” the conviction is indicative
of unfitness for licensure, does not suggest otherwise. That
is because a determination that someone’s criminal record
speaks to their current fitness for an occupation license is
a different type of inquiry than a determination that a violation of a law is grounds for a penalty of some sort.10 A fitness inquiry typically asks, is this person presently fit to hold
an occupational license in this field? By contrast, a penalty
inquiry asks, did the person violate a statute or rule and, if
so, should they be monetarily penalized? Although evidence
of violations of statutes and rules certainly will be relevant
evidence in a fitness inquiry, that does not equate in any
easy way to a conclusion that a person “violates” a statute or
rule simply by being a person who is not fit to hold a license.
We take a side trip here, one we hope might ultimately prove helpful to our state’s administrative agencies.
It is worth observing that, to the extent its administrative
rules are any indication, this distinction between finding
someone unfit for licensure based on a conviction versus
finding that someone has violated a CCB statute or rule and
should be penalized with a monetary sanction is something
the CCB appears to understand as a general matter.
The CCB has promulgated a fitness rule—OAR
812-005-0280—to govern licensing determinations based
on fitness and has promulgated an entirely separate penalty
rule—OAR 812-005-0800—to govern the assessment of monetary civil penalties. The fitness rule, among other things,
requires the agency to assess whether a license applicant
or licensee’s criminal conduct “is substantially related to
the fitness and ability of the applicant or licensee to engage
10
Although it arose in a different context, the Supreme Court’s explanation
in Cuff v. Department of Public Safety Standards, 345 Or 462, 470,
198 P3d 931
(2008), of the nature of a fitness-for-licensure decision aids in understanding this
point. As the court explained there, when taking into account past conduct in
assessing fitness for professional licensure, an agency is determining how that
conduct bears on the person’s present fitness to hold an occupational license. See
generally
id. at 471-72. In other words, although a fitness inquiry may take into
account whether a person has violated other laws, the ultimate determination is
one of a person’s present status of fitness for licensure, not a determination that
the person has violated, that is, acted contrary to or failed to comply with another
law.
Cite as
311 Or App 40 (2021) 59
in construction contracting” in determining whether the
criminal conduct supplies grounds for a licensing decision.
OAR 812-005-0280(1). In other words, the agency examines
whether a person is presently fit to be a construction contractor, not whether the person has acted in disregard of a
relevant statute or rule.
The CCB also has promulgated a detailed rule governing the imposition of civil penalties, one that, both now
and at the time it imposed the penalty, provides and provided an admirably clear roadmap to the public on how it
will exercise its penalty authority. See OAR 812-005-0800;
see also OAR 812-005-0800 (July 1, 2014). The penalty rule
contains no provisions authorizing the imposition of a civil
penalty based either on the fact of a conviction, standing
alone, or a determination of unfitness for licensure. Beyond
that, each thing for which the rule does authorize a monetary penalty entails a breach of an identified statute, rule,
or prohibition related to construction contracting, as reasonably might be expected of a rule adopted to implement a
statute permitting the imposition of a civil penalty on someone who “violates” a CCB statute or rule. See generally OAR
812-005-0800.
There is no indication in this record that the CCB
first looked to its own administrative rule governing civil
penalties when evaluating the ALJ’s determination that
the CCB is not authorized to impose a civil penalty based
on a determination that a license applicant or licensee is
unfit for licensure due to a qualifying conviction. That omission appears to conflict with the Supreme Court’s directive:
“[A]dministrative rules, once made, must be followed, in
order for the public to have a reliable road map as to the
actions that its government claims to be entitled to take.”
Marshall’s Towing v. Department of State Police, 339 Or 54,
58 n 5,
116 P3d 873 (2005).
Having visited the rules implementing the statute,
we return to the statute. Context corroborates the plain
text’s message. ORS 701.098(1) states at its start that “[t]he
Construction Contractors Board may revoke, suspend or
refuse to issue or reissue a license and the board may assess
60 Allied Structural v. CCB
a civil penalty as provided in ORS 701.992 if the board
determines after notice and opportunity for a hearing” that
one of 14 identified grounds is present. (Emphasis added.)
Had the legislature intended, as the CCB apparently concluded in its order, that each of the identified grounds for
a licensing action supply a basis for a civil penalty, there
would have been no need for the legislature to refer to ORS
701.992. The fact that it did so indicates that the legislature
intended for ORS 701.992 to control whether a ground for a
particular licensing decision listed in ORS 701.098 was also
a basis for a civil penalty, and did not intend to authorize a
civil penalty for each and every identified basis for a licensing sanction.
Additionally, the plain terms of ORS 701.098(1)
make the provision applicable to initial applications for
licenses by persons who have never held them, providing
that the CCB may “refuse to issue … a license” based on
the identified grounds. That means, under the CCB’s and the
dissenting opinion’s take on things, the CCB could impose
a $5,000 civil penalty on a person seeking to become a construction contractor, someone who has never been a part of
the profession or done anything to violate CCB statutes or
rules, just because that person honestly disclosed the fact
of having a prior conviction listed in ORS 701.098(1)(i) and
the CCB determined that the conviction made the person
unfit for licensure. That does not seem to be a likely legislative objective, or a constitutional one. Although a citizen
reasonably might anticipate being denied licensure based
on prior criminal history, no one would suspect that honestly disclosing one’s criminal history on an application for a
professional license would mean paying not only any administrative application fee but also up to $5,000 more.
ORS 670.280 fortifies this contextual case. Recall:
The operative wording of ORS 701.098(1)(i) states that the
CCB “may revoke, suspend or refuse to issue or reissue a
license and the board may assess a civil penalty as provided
in ORS 701.992 if the board determines after notice and
opportunity for a hearing … [c]onsistent with the provisions of ORS 670.280” that the licensee, prospective licensee
or relevant RMI has a listed criminal conviction. (Emphasis
Cite as 311 Or App 40 (2021) 61
added.) In turn, ORS 670.280(2) states, in relevant part,
that
“a licensing board, commission or agency may not deny,
suspend or revoke an occupational or professional license
solely for the reason that the applicant or licensee has been
convicted of a crime, but it may consider the relationship
of the facts which support the conviction and all intervening circumstances to the specific occupational or professional standards in determining the fitness of the person
to receive or hold the license.”
Noticeably absent from that provision addressing
the role of convictions in licensing decisions is any suggestion that the legislature envisioned that licensing agencies
would impose civil penalties based on the fact of a prior conviction. Instead, the provision signals a legislative intention
to restrict licensing agencies’ use of prior convictions and to
ensure that prior convictions are used by licensing agencies
only insofar as they bear on “the fitness of the person to
receive or hold the license.” ORS 670.280(2). It would not be
“[c]onsistent with the provisions of ORS 670.280” to conclude
that a prior conviction supplies a ground for a monetary
penalty in addition to grounds for a licensing decision. Had
the legislature intended for the fact of a conviction bearing
on fitness for occupational licensure to supply grounds for a
licensing agency to impose a monetary penalty based simply
on the fitness determination, it seems likely that the legislature would have made mention of that possibility in ORS
670.280 when explaining how a licensing agency may use a
conviction to assess fitness for licensure.
This textual and contextual inquiry is enough to
resolve the question presented. The parties have not brought
any relevant legislative history to our attention that would
call that conclusion into question, and we are aware of none.
See ORS 174.020(3) (“A court may limit its consideration
of legislative history to the information that the parties
provide to the court.”). Beyond that, we note only that to
construe ORS 701.992 to allow for the imposition of a civil
penalty based solely on the status of having a conviction,
or the status of being unfit for licensure, would raise some
serious constitutional questions regarding double jeopardy
62 Allied Structural v. CCB
and due process, particularly given the fact that, as we
have observed, that interpretation would mean that initial
license applicants would be subject to civil penalties for prior
convictions, despite having never done anything to violate a
provision of chapter 701 or a CCB rule. That is yet one more
reason to give ORS 701.992 its ordinary meaning, rather
than an extraordinary one. See State v. Bordeaux, 220 Or
App 165, 175-76,
185 P3d 524 (2008) (under the maxim of
constitutional avoidance, “we assume that the legislature
intended the construction that would not lead to possible
constitutional problems” (emphasis in original)).
The dissenting opinion reaches a contrary conclusion primarily based on its view that “[t]he text of ORS
701.098 could not be more plain that each of the myriad of circumstances and misconduct described in ORS 701.098(1)(a)
through (n) can constitute the basis for the assessment of a
penalty.” 311 Or App at 67 (Egan, C. J., concurring in part,
dissenting in part). But as even the CCB reads the statutes,
the penalty statute controls by virtue of the textural reference to it, making the question whether particular conduct
“violates” CCB statutes and rules. In other words, not even
the CCB contends, as the dissenting opinion concludes, that
ORS 701.098 independently authorizes a civil penalty for
each identified ground for a licensing decision. But, one way
or another, the statute does not, as the dissenting opinion
posits, plainly or unambiguously authorize monetary penalties for each of the identified grounds for licensing actions.
And for all the reasons we have explained, we would decline
to resolve the statutory ambiguity in a way that empowers
the CCB to penalize status rather than violations of the
statutes and rules regulating construction contracting.11
11
In asserting that ORS 701.098 is unambiguous, the dissenting opinion
theorizes that the cross-reference to ORS 701.992 serves to incorporate procedure. 311 Or App at 68 (Egan, C. J., concurring in part, dissenting in part).
That theory does not grapple with two critical aspects of context. First, ORS
701.992 contains both substantive and procedural provisions, but the legislature did not single out the procedural provisions when it cross-referenced ORS
701.992, making it questionable that the legislature solely intended to embrace
the procedural provisions of ORS 701.992. Second, the procedure contained in
ORS 701.992 is essentially the same as the procedure afforded by ORS 701.098,
making the cross-reference unnecessary if its only purpose was to identify the
applicable procedure. ORS 701.098 requires “notice and opportunity for hearing”
when taking a licensing action under ORS 701.098(1). Under the Administrative
Procedures Act, the hearing must be a contested case hearing. ORS 183.310
(2)(a)(C). ORS 701.992(2) specifies that “[c]ivil penalties under this section shall
Cite as 311 Or App 40 (2021) 63
We acknowledge that the statutes, as drafted, do
not supply a crystalline guide to the legislature’s intentions,
and that our interpretation may lead to some repetition and
minor redundancies. This particular legislative scheme is
one that has been built and then remodeled by successive
legislatures over the years, and it is not one that fits neatly
together. Taking that into account, the best we can do is do
our best to determine what “the enacting legislature most
likely intended.” Tarr, 306 Or App at 33. Here, as the CCB
appears to have recognized in its own administrative rules,
the text and context of ORS 701.992 indicate that the legislature likely intended that prior convictions demonstrating
unfitness for licensure would not provide grounds for separate civil penalties. Given a choice between some small measure of redundancy and a construction that gives the CCB
the sweeping power to impose fines based on status alone,
the answer is easy. See State v. Lively,
294 Or App 377, 383,
430 P3d 1120 (2018) (noting that, “ ‘in legal drafting, redundancy is a fairly common phenomenon’ ” (quoting Friends of
Yamhill County v. Yamhill County,
229 Or App 188, 195,
211
P3d 297 (2009))).
This is not to say that this case did not involve
conduct for which the CCB was statutorily authorized to
impose civil penalties. As noted, the ALJ originally found
that Allied had violated a CCB rule and imposed a civil penalty based on that finding of a violation. For reasons that
are not immediately clear from the record, the CCB elected
to withdraw that alleged violation and did not pursue any
others. That was entirely within its discretion to do, but, in
so doing, the CCB has left itself without a lawful basis for
imposing a civil penalty in this case.
In sum, the CCB did not procedurally err and did
not err in revoking Allied’s license. In imposing the civil penalty, however, it erroneously interpreted ORS 701.992 when
it concluded that its determination that Allied was unfit
for licensure under ORS 701.098(1)(i)(E) meant that Allied
had violated a provision of chapter 701 so as to allow for the
imposition of a civil penalty under ORS 701.992. A correct
be imposed as provided in ORS 183.745.” ORS 183.745, in turn, provides for notice
and a contested case hearing whenever an agency proposes to impose a civil penalty. See generally ORS 183.745.
64 Allied Structural v. CCB
interpretation requires that the order be modified to set
aside the civil penalty, something that ORS 183.482(8)(a)(A)
gives us the authority to do. ORS 183.482(8)(a)(A) (court may
“[s]et aside or modify the order” when correct interpretation
of a provision of law “compels a particular action”).
Order modified to set aside $5,000 civil penalty;
otherwise affirmed.
EGAN, C. J., concurring in part; dissenting in part.
I appreciate the majority’s acknowledgment of the
panel’s contribution to the analysis of Allied’s first, second,
third, and fifth assignments of error, and I concur in its disposition of those assignments. I write separately to dissent
from the majority’s resolution of Allied’s fourth assignment,
because I conclude that the Construction Contractors Board
(CCB) correctly determined that Allied could be assessed a
penalty under ORS 701.098(1) for Koontz’s qualifying conviction of sexual abuse during a prior period of licensure
and his failure to report that conviction.
In its fourth assignment, Allied contends that the
CCB exceeded its authority in assessing a penalty under
ORS 701.098(1) based on Koontz’s conviction for sexual
abuse. The majority agrees with Allied, but does so, in my
view, without a complete engagement with the statutory
texts which, of course, set the parameters for the CCB’s
authority. As relevant here, ORS 701.098 provides:
“(1) The Construction Contractors Board may revoke,
suspend or refuse to issue or reissue a license and the board
may assess a civil penalty as provided in ORS 701.992 if the
board determines after notice and opportunity for hearing:
“(a) That the licensee or applicant has violated a provision of this chapter.
“(b) That the licensee has violated a rule or order of
the board.
“(c) That the licensee has knowingly assisted an unlicensed person to act in violation of this chapter.
“(d) That the licensee has knowingly assisted a
licensed contractor to perform work for which the contractor is not properly endorsed.
Cite as 311 Or App 40 (2021) 65
“(e) That a lien was filed on a structure under ORS
87.010 to 87.060 and 87.075 to 87.093 because the licensee
or applicant wrongfully failed to perform a contractual
duty to pay money to the person claiming the lien.
“(f) That the licensee has knowingly provided false
information to the board.
“(g) That the licensee has worked without a construction permit where a permit is required and the work
resulted in a complaint being filed with the board under
ORS 701.139. …
“(h) That the number of licensed contractors working
together on the same task on the same job site, where one
of the contractors is classed as exempt under ORS 701.035
(2)(b), exceeded [statutory limits.]
“…
“(i) Consistent with the provisions of ORS 670.280,
that the licensee or applicant, or an owner or officer of the
licensee or applicant has been convicted of one of the following crimes in this state or an equivalent crime in another
state:
“(A) Murder;
“(B) Assault in the first degree;
“(C) Kidnapping;
“(D) Rape, sodomy or unlawful sexual penetration;
“(E) Sexual abuse;
“(F) Arson in the first degree;
“(G) Robbery in the first degree;
“(H) Theft in the first degree; or
“(I) Extortion.
“(j) That the licensee or applicant has not, within
90 days after the date when payment was received from
the public contracting agency, or contractor in the case of a
subcontractor, made payment to any person for supplying
labor or materials contracted for with a public contract for
a public improvement plus the amount of interest due.
66 Allied Structural v. CCB
“(k) That the licensee or applicant has repeatedly
reported bad faith or false complaints of nonpayment
against contractors or subcontractors.
“(L) That the licensee or applicant has engaged in
conduct as a contractor that is dishonest or fraudulent and
that the board finds injurious to the welfare of the public.
“(m) That the contractor has hired employees while
licensed as exempt under ORS 701.035.
“(n) That the contractor has utilized one or more workers supplied by a worker leasing company while licensed as
exempt under ORS 701.035.
“(2) The board may revoke, suspend or refuse to issue
or reissue a license if the board determines after notice
and opportunity for hearing that an applicant or licensee
is unfit for licensure based upon information submitted to
the board under ORS 701.046, submitted in a registration
of securities described in ORS 701.046 (2) or discovered by
a board investigation under ORS 701.225.
“(3) The board may assess a civil penalty as provided
in ORS 701.992 if the board determines after notice and
opportunity for hearing that any person has violated ORS
701.021 [relating to licensing requirements].
“(4)(a) The administrator of the board, in accordance
with administrative rules adopted by the board and after
setting forth specific reasons for the findings, may suspend
or refuse to renew a license without hearing in any case
where the administrator finds a serious danger to the public welfare, including but not limited to:
“(A) Lack of a surety bond required by ORS 701.068;
“(B) Lack of liability insurance required by ORS
701.073;
“(C) Hiring employees while classed as exempt under
ORS 701.035;
“(D) Utilizing one or more workers supplied by a
worker leasing company while classed as exempt under
ORS 701.035;
“(E) Conduct as a construction contractor that is dishonest or fraudulent; or
“(F) Failure to pay a construction debt.
Cite as 311 Or App 40 (2021) 67
“…
“(5)(a) In addition to all other remedies, if the board
has reason to believe that a person is engaging in an act,
practice or transaction that violates this chapter or a board
rule, the board may issue an order directing the person to
cease the act or to take corrective action.”
(Emphasis added.) The text of ORS 701.098 could not be
more plain that each of the myriad of circumstances and
misconduct described in ORS 701.098(1)(a) through (n) can
constitute the basis for the assessment of a penalty. As a
textual matter, ORS 701.098(1) unambiguously authorizes
the assessment of a penalty for Koontz’s qualifying sexual
abuse conviction.
The subsection’s context is consistent with that conclusion. Other subsections of ORS 701.098 describe consequences for other forms of misconduct. For example, ORS
701.098(3) states that a penalty may be assessed for “violation” of ORS 701.021, which describes licensure requirements (but does not explicitly describe noncompliance as
a “violation”). ORS 701.098(2) authorizes consequences of
revocation, suspension, or refusal to renew upon a finding
of unfitness. ORS 701.098(4) authorizes consequences of
suspension or refusal to renew upon a finding of lack of a
surety bond or liability insurance; conduct that is dishonest
or fraudulent; failure to pay a construction debt; or improper
licensing. In short, the text of ORS 701.098(1) and its context
show that the legislature knew how to describe authorized
consequences, including penalties, for certain types of misconduct. I have no doubt that when the legislature stated
in ORS 701.098(1) that the CCB may assess a penalty upon
determining that a licensee had engaged in the misconduct
described in that subsection, it meant to authorize penalties
for the misconduct described in that subsection.
The focus of the majority’s reasoning is the proviso in
ORS 701.098(1) that a penalty for the misconduct described
in ORS 701.098(1)(a) to (n) may be assessed “as provided in
ORS 701.992.” ORS 701.992 states the procedures for the
assessment of penalties and provides for the assessment of
a civil penalty in an amount not to exceed $5,000 against
68 Allied Structural v. CCB
“any person who violates any provision of this chapter.”
The majority reasons that, because the types of misconduct
listed in ORS 701.098(1) are not explicitly described in ORS
701.098 as “violations,” they can only give rise to penalties if
they are separately identified as violations elsewhere in ORS
chapter 701. That reading of the statutory scheme cannot be
correct.
First, as I view the reference in ORS 701.098(1)
to ORS 701.992, it is not for the purpose of qualifying the
misconduct subject to a penalty—that is already done in
ORS 701.098(1). I would conclude that the reference in ORS
701.098(1) to ORS 701.992 is to the procedures set out in ORS
701.992 for the assessment of a penalty. That is the most
plausible interpretation of ORS 701.098(1) in light of its text
and context.1
But even assuming the correctness of the majority’s
view that ORS 701.992 determines the misconduct for which
a penalty may be assessed under ORS 701.098(1), the CCB’s
assessment of a penalty here should be upheld. ORS 701.992
provides that a penalty up to $5,000 may be assessed
against “any person who violates any provision of this chapter.” (Emphasis added.) Contrary to the majority’s assumption, statutory provisions that explicitly describe violations
in ORS chapter 701 are not the only provisions of ORS chapter 701 that a person can violate. A section is violated by
noncompliance. For example, ORS 701.098(3) states that
a penalty may be assessed for “violation” of ORS 701.021,
which describes licensure requirements but does not itself
describe a “violation.” And ORS 701.992 refers to misconduct described in ORS 701.098(1)(h) as a “violation,” even
though ORS 701.098(1)(h) itself does not explicitly identify
that misconduct as a violation. See ORS 701.992(4) (setting
forth sanctions for “violations” of ORS 701.098(1)(h)). ORS
701.098(1) need not explicitly state that the described misconducts and circumstances constitute “violations.” That is
1
The majority posits, regarding the significance of the cross-reference to
ORS 701.992, that “not even the CCB contends, as the dissenting opinion concludes, that ORS 701.098 independently authorizes a civil penalty for each identified ground for a licensing decision.” 311 Or App at 62. That is true. That is
because the CCB agrees with our analysis, below, that a conviction listed in ORS
701.098(1)(i)(E) is a violation of ORS chapter 701.
Cite as 311 Or App 40 (2021) 69
implicit in the subsection’s authorization of consequences,
including penalties, for their occurrence.
It is clear to me that the reference in ORS 701.992
to violations of “any provision of this chapter” is intended
to encompass the many types of misconduct described in
ORS 701.098(1)(a) to (n). That, in my view, means that a
person who has a qualifying criminal conviction for sexual
abuse has “violated” ORS 701.098(1)(i) for purposes of ORS
701.992(1).
I do not share the majority’s concern that the
assessment of a penalty in this case was for the “status” of
having a conviction; Koontz’s unreported conviction for sexual abuse occurred during a prior period of licensure and
constituted a violation of ORS 701.098(1).2 The penalty for
that misconduct should be upheld.
DeVore, Tookey, and Aoyagi, JJ., join in this concurrence in part and dissent in part.
2
The majority is also concerned about the due process or double jeopardy
implications of treating a “status” of having a former conviction as a violation. 311
Or App at 61-62. That argument is not raised by petitioner.
