decided: September 26, 1988.
RONALD J. RYAN, PETITIONER
COMMONWEALTH OF PENNSYLVANIA, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW, RESPONDENT
Appeal from the order of the Unemployment Compensation Board of Review, in the case of In Re: Claim of Ronald J. Ryan, No. B-251911.
Thomas F. Putinsky, for petitioner.
Jonathan Zorach, Associate Counsel, with him, Clifford F. Blaze, Deputy Chief Counsel, for respondent.
Judges Doyle and McGinley, and Senior Judge Kalish, sitting as a panel of three. Opinion by Judge McGinley.
[ 120 Pa. Commw. Page 81]
Ronald J. Ryan (claimant) appeals an Order of the Unemployment Compensation Board of Review (Board) which affirmed a referee's decision affirming and modifying the determination of the Office of Employment Security (OES) to deny claimant benefits for claim weeks ending March 15, 1986 through May 17, 1986 and ordering recoupment of overpayment of $1,312.00 under Section 804(a) of the Unemployment Compensation Law (Law).*fn1
Claimant was terminated from his employment with Cameron & Leach, Ltd., on February 28, 1986. He applied for and received unemployment benefits, effective March 2, 1986. On March 5, 1986, the claimant's father and mother entered into a partnership agreement creating the enterprise of Ryan & Ryan, Ltd. and claimant allegedly made contacts and solicited business on Ryan & Ryan, Ltd.'s behalf. Business cards were admittedly distributed bearing claimant's name and the name of the new business venture (Notes of Testimony, June 17, 1986, (N.T.) at 5). In early May the OES received reports that claimant was employed. On May 8, 1986, an
[ 120 Pa. Commw. Page 82]
OES investigator telephoned and spoke with claimant by telephoning the number listed on the business cards. Claimant denied any association with Ryan & Ryan, Ltd. then, but on May 19, 1986, he contradictorily reported to the OES that he had "become" an employee of Ryan & Ryan, Ltd. on May 5, 1986 (N.T. at 7). OES issued a determination that claimant was self-employed and ineligible for benefits under Section 402(h) of the Law.*fn2 On appeal the referee determined there was insufficient evidence to substantiate the claim that claimant was self-employed, but he found that claimant was not partially or totally unemployed and that claimant was ineligible for benefits under Sections 401 of the Law*fn3 and 4(u) of the Law.*fn4 Claimant further appealed to the Board which affirmed the decision of the referee. Claimant has timely appealed to this Court.
[ 120 Pa. Commw. Page 83]
Our scope of review is limited to determining whether there has been a constitutional violation or an error of law and whether the findings of fact are supported by substantial evidence. Section 704 of the Administrative Agency Law. 2 Pa. C.S. § 704, Kirkwood v. Unemployment Compensation Board of Review, 106 Pa. Commonwealth Ct. 92, 525 A.2d 841 (1987). Claimant argues that the referee's findings of fact were not supported by substantial evidence.
Claimant argues that he was not an employee of Ryan & Ryan, Ltd., nor self-employed, during the benefits period. Claimant contends that after his parents created the partnership, the father, James Ryan, printed business cards with Ronald Ryan listed as an employee under various titles to attract prospective clients. Claimant alleges these cards were printed and distributed without his knowledge or consent, and there is no testimony of when the cards were printed or distributed.*fn5 Claimant admitted that he contacted former clients
[ 120 Pa. Commw. Page 84]
of his previous employer and personal friends to "test the waters" for Ryan & Ryan, Ltd. toward the end of March.*fn6 Claimant alleges that at no point did he receive any benefits or remuneration from Ryan & Ryan, Ltd. for his efforts (N.T. at 19).
[ 120 Pa. Commw. Page 85]
Our Court has held that the findings of the referee which are affirmed by the Board are binding on this court when supported by substantial evidence, although there is record evidence to the contrary. Welex, Inc. v. Unemployment Compensation Board of Review, 67 Pa. Commonwealth Ct. 640, 447 A.2d 1110 (1982); Martin v. Unemployment Compensation Board of Review, 36 Pa. Commonwealth Ct. 304, 387 A.2d 998 (1978). After review of the testimony and the referee's findings and conclusions it is apparent the referee disbelieved many of claimant's assertions.*fn7 We have held that the referee may reject even uncontroverted testimony, Edelman v. Unemployment Compensation Board of Review, 10 Pa. Commonwealth Ct. 275, 310 A.2d 707 (1973), and that he is justified in making credibility determinations. Swope v. Unemployment Compensation Board of Review, 91 Pa. Commonwealth Ct. 459, 497 A.2d 289 (1985). When there is conflicting evidence it does not
[ 120 Pa. Commw. Page 86]
necessarily mean that the findings of fact are not supported by substantial evidence. Geesey v. Unemployment Compensation Board of Review, 33 Pa. Commonwealth Ct. 376, 381 A.2d 1343 (1978). Alternatively, just because there is conflicting evidence and inconsistencies does not necessarily mean that substantial evidence does exist. Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Rabinowitz v. Unemployment Compensation Board of Review, 15 Pa. Commonwealth Ct. 51, 324 A.2d 825 (1974).
In Carter v. Unemployment Compensation Board of Review, 65 Pa. Commonwealth Ct. 569, 442 A.2d 1245 (1982), this Court stated that where a fair reading of the record establishes that an unemployment compensation claimant withheld information from the Office of Employment Security that was material to his eligibility the record clearly establishes fault of claimant warranting recoupment of benefits paid to him under Section 874(a) of the Law. After a fair reading of this record, we conclude a recoupment of benefits paid to claimant is warranted, but not a total recoupment.
Finding of Fact No. 9 is unsupported by substantial evidence. Substantial evidence only exists for this finding as of late March, leaving the referee's general conclusion unfounded.*fn8 Finding of Fact No. 10, insofar as it concerns claimant's actions prior to late March, is also unsupported by substantial evidence.*fn9 Claimant testified to "testing the waters" in late March and that his father sent out business cards with his name listed under various titles. However, nowhere in the testimony did claimant or claimant's father testify as to when these
[ 120 Pa. Commw. Page 87]
cards were sent. Finding of Fact No. 11 is therefore unsupported by substantial evidence.*fn10 The statement of the referee that he had a letter dated April 3, 1986 (N.T. at 5), containing a copy of a business card is hearsay, admitted without objection, but not corroborated by any competent evidence in the record, and therefore may not support a finding by the Board.*fn11 No substantial evidence exists to support the conclusion that claimant was employed by Ryan and Ryan, Ltd. when the partnership began on March 5, 1986, or that claimant engaged in activity on behalf of the partnership at that time.
In Finding of Fact No. 7 the referee determined that claimant received benefits for claim weeks ending March 15, 1986, through May 3, 1986.*fn12 Therefore referee's Findings of Fact Nos. 12 and 13 are irrelevant for purposes other than evaluating claimant's credibility because they reflect claimant's conduct on May 8, 1986, and May 19, 1986, and subsequent to the benefit period at issue.*fn13
[ 120 Pa. Commw. Page 88]
Accordingly we reverse the order of the Board for recoupment of benefits received in March and affirm the Board's order of recoupment of benefits received April through May 3, 1986.*fn14
Now, September 26, 1988, the decision of the Unemployment Compensation Board of Review at No. B-251911, dated August 13, 1986, is hereby reversed in part and affirmed in part in accordance with this opinion.
Reversed in part and affirmed in part.