yates-transcript2_ 2011 1703-dcr 2012-04-27 hearing

BEFORE THE WEST VIRGINIA PUBLIC EMPLOYEES GRIEVANCE BOARD

J. HUDSON YATES

Grievant.

V. Docket No. 2011-1703-DOR

TAX DEPARTMENT

Respondent.

Transcript of Level III hearing in the above

styled case held on April 27, 2012, at the Grievance

Board’s offices in Elkins, West Virginia.

BEFORE: RONALD REECE

Administrative Law Judge

APPEARANCES: Hudson Yates

Grievant, Pro Se

Charlie Fulton, Esquire

Counsel for the Respondent

Transcription Services Provided By:

Globespan Transcription

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Transcriptionist’s Certificates. . . . . . . . . .pg 87 24

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I N D E X

Respondent

Witness:

Direct Cross

Redr Recr

Jeff Oakes 9 17

Michael Coutz 29 40

Kim Silvester 46 63 71

Mr. Shaw 73

E X H I B I T S

EXHIBITS Marked Rec’d

G-1 (withdrawn) 21 21

G-1 65 72

R-1 31 31

R-2 33 33

R-3 53 53

Joint 1 85 85

Agency’s AX

Agency’s BX

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BE IT REMEMBERED that the following 1

proceedings were had on April 27, 2012, to-wit: 2

THE COURT: April 27, 2012; it’s a little 3

past 10:30 and we are all situated at the senior center 4

located in Elkins, West Virginia. My name is Ron 5

Reece, I’m the administrative law judge assigned by the 6

Grievance Board to conduct this level III hearing and 7

also to offer a decision in this grievance. The 8

respondent, the Tax Department, appears by its counsel, 9

Ms. Fulton and also this morning it’s representative is 10

Mr. Oakes. Mr. Yates, the Grievant, appears in person 11

and is pro se this morning. Before we went on the 12

record we just briefly discussed that we were going to 13

make a part of the level III file what had occurred, 14

excuse me, at level I by way of a transcript and also 15

by way of Respondent’s Exhibits and Mr. Yates exhibit 16

at level I. There was a level II mediation and the 17

parties discussed that there were certain items in the 18

file concerning level II and we’re going to make the 19

settlement agreement part of the file in this matter, 20

although, to be honest with you, I haven’t read it. 21

And also indicated that Ms. Gould, the ALJ at level II 22

had left some of her notes, I’m going to remove those 23

from the file and shred those. I didn’t do that before 24



today but I will at some point after we’re finished 1

today. 2

Today we’re going, there was a motion to 3

continue this hearing but I denied the motion because 4

of, basically what I told the parties if we, if we 5

didn’t start today and work towards finishing or at 6

least getting halfway to, into the case, it would 7

probably be late summer or the fall before we could 8

come back and convene this level III hearing. 9

Also, there was a motion to, there was a 10

motion for, request rather for subpoenas and I issued 11

those subpoenas for Mr. Yates except for the request to 12

have Ms. Fulton subpoenaed. And there was a subsequent 13

motion to quash them. After we’re done with the 14

Respondent’s case in chief (unin), we’re going to 15

briefly discuss Mr. Yates request and the motion to 16

quash the subpoena on behalf of the Respondent. 17

This is a disciplinary case. My 18

understanding is, Mr. Yates received a written 19

reprimand for some events and testimony that took place 20

at a revocation hearing some time ago. Therefore, it 21

is a disciplinary case the the Respondent bears the 22

burden of proof to establish the charges that led to 23

his reprimand by preponderance of the evidence. What 24



that also means is Ms. Fulton will present her case in 1

chief first and then Mr. Yates will have an opportunity 2

to present his case in chief. 3

Well, good morning, Ms. Fulton, did you have 4

any openings this morning for this grievance? 5

MS. FULTON: Yes, the Tax Department position 6

on this is, the Tax Department issued written 7

reprimands to the Grievant based on two matters. There 8

was a third which was addressed at level I and which 9

the Tax Department no longer relies on. 10

One being, not having the proper 11

documentation regarding the tax payers account at a 12

business registration revocation hearing. The evidence 13

today will who that the Grievant emailed his supervisor 14

the day before the hearing to ask what documents to 15

take; that the Grievant told his supervisor he had a 16

current summary of liability and notice of intent to 17

(unin) and a certificate of service showing that he had 18

served the notice of intent to revoke. The supervisor 19

responded that he should take the file with him 20

including his notes regarding contacts and his payments 21

(unin). The evidence will show that the Grievant did 22

not take the file and the payment plan to the hearing. 23

In addition, second issue was that the 24



Grievant testified under oath as to having three 1

payment agreements when in fact there were no signed 2

payment agreements either in (unin) or manually 3

prepared and that an unsigned agreement under tax 4

policy is not considered binding or an agreement. The 5

evidence will show that the Grievant testified to 6

having entered his payment agreements, that all three 7

were defaulted, that at that hearing the judge, the 8

administrative law judge asked for the terms of the 9

agreement (unin) the agreement to judge whether under 10

those terms they actually were in fact defaulted. But 11

the plans had not been brought. The judge took a break 12

so that the witness can (unin) folks could go back to 13

their office and get the payment plan. When they 14

return back to the record the Grievant testified that 15

the plans were not attached to the account in (unin) 16

and couldn’t say for sure whether the plans were on 17

file in his office. That it is the Tax Departments 18

plan that an unsigned agreement is not an agreement at 19

all. The Department characterized this conduct as a 20

failure to observe a standard of conduct that will not 21

request this credit on the state or on the integrity of 22

the state employee’s ability to perform their duties. 23

And based on the fact that the Department had proffered 24



testimony at this hearing under oath that was either 1

incorrect or--that was misleading or incorrect, the Tax 2

Department voluntarily dismissed the revocation 3

proceeding. 4

The Grievant defends, attempts to defend by 5

arguing that he was not properly trained for the 6

hearing procedure that was at issue. The evidence will 7

show that in fact there was a training session on 8

revocation hearings at a 2009 annual meeting with a 9

substantial handout being distributed make it clear 10

that all payment plans must be in writing and must be 11

signed. 12

The second thing the Grievant argues is that 13

the reprimand is too harsh a penalty because other 14

employees (unin) superior’s orders were not 15

reprimanded. And he contends further that the 16

motivation for the reprimand was Mike Coutz’s dislike 17

of him. 18

And third, he asserts that the supervisor 19

failed to follow progressive disciplinary policy of the 20

Division of Personnel. The facts will show that other, 21

the other employees who (unin) supervisor’s orders were 22

not engaged in conduct of simply disobeying--that they 23

were engaged in conduct of refusing orders but it was 24



not on a magnitude of anything as serious as providing 1

false and leading evidence under oath. Further that 2

the evidence that the Grievant relies on regarding Mr. 3

Coutz’s alleged dislike of him and his signing his name 4

to three (unin) compromise were in fact not signatures 5

but merely added to indicate what revenue agent was 6

assigned to the case. 7

And finally, the, the Division of Personnel’s 8

supervisor’s guide to progressive discipline is in fact 9

a reference and not legally binding. The only legal 10

requirement for disciplinary action against the 11

employee is that the discipline is appropriate to the 12

level of the offense. 13

THE COURT: Okay, thank you, Ms. Fulton. Mr. 14

Yates, did you have any opening this morning before we 15

get started with the evidence? 16

MR. YATES: No I did not prepare one because 17

I didn’t expect to have one until I went for my half, 18

so… 19

THE COURT: Oh, that’s fine you can… 20

MR. YATES: …I’ll have one at that time. 21

THE COURT: You’ll just reserve your right to 22

make opening before you begin your case in chief. 23

MR. YATES: Yes. 24



THE COURT: Very well. Alright, Ms. Fulton, 1

we’ll have the testimony of Mr. Oakes, is that my 2

understanding? 3

MS. FULTON: Yes. 4

THE COURT: Alright, Mr. Oakes, you can 5

remain seated but before you testify I’ll need to swear 6

you in. If you’ll raise your right hand. 7

(Witness sworn) 8

Thank you sir, go right ahead Ms. Fulton. 9

DIRECT TESTIMONY 10

Q. What is your full name please? 11

A. Jeffery Thomas Oakes. 12

Q. What is, where do you work? 13

A. I work at the revenue center in Charleston 14

where the (unin). 15

Q. What is your position there? 16

A. I’m the acting deputy tax commissioner. 17

(unin). 18

Q. Could you explain to us what the business 19

registration requirements are under West Virginia law? 20

A. The law provides that anybody engaged in 21

(Unin) activities is required to apply for and receive 22

a West Virginia business registration certificate 23

(unin). 24



Q. And are business registration certificates 1

ever revoked? 2

A. Yes, on occasion when a tax payer is, 3

demonstrated a level of delinquency or when they have 4

(unin). 5

THE COURT: (Unin). 6

A. Okay. 7

THE COURT: Excuse me, go ahead. 8

A. When a, when a taxpayer is not in good 9

standing, has demonstrated a level of non-compliance 10

with state tax laws, revocation is an option that is 11

provided by the West Virginia Code. 12

Q. Let me stop you there. What does it mean to 13

be not, for a taxpayer to be not in good standing? 14

A. Actually, the law says that a tax payer, 15

depending on the nature of tax payers business, there 16

are requirements to file certain taxes, certain (unin). 17

Code says that when a taxpayer fails to file a return 18

or make a payment as required by law then they’re not 19

in good standing. It’s grounds for revocation even if 20

one (unin) does occur. 21

Q. What is the procedure involved in revoking a 22

certificate of registration? 23

A. We have to notify the debtor first. They’re 24



entitled to due process under law. The process has 1

changed slightly but during time when this particular 2

case was before a court the notice actually, we’ll, 3

we’ll provide the tax payer with a date and a time that 4

they can appear at a show cause hearing to demonstrate 5

why the revocation would not be appropriate in their 6

case. We also give them a description of the, of the 7

delinquencies that, that we have documented (unin). 8

Q. And is there a particular procedure for 9

serving (unin) tax payer (unin). 10

A. Yes, it’s required by law that the notice be 11

sent certified or delivered by personal service. 12

Q. What procedures are you--you talked, you 13

mentioned earlier that if tax payers were in good, were 14

not in good standing this was one of the things that 15

could be done. What other kinds of procedures can be 16

used to bring up a tax payer who’s not in good standing 17

into compliance? 18

A. Well, under the law the tax commissioner has 19

the, best way to describe it is a broad authority to 20

(unin) rules and policies to (unin) the collection of 21

(unin) taxes. Obviously revocation is one such manner 22

but it’s not something that we, that we look to first. 23

Usually we, we do have, we would encourage tax payers 24



to term the payment agreements with us because we 1

understand that often taxpayers get in a situation 2

where they can’t afford to get right with the 3

department and (unin). So, while, while payment plans 4

are not (unin), we do encourage, we do accept them when 5

circumstances suggest that that might be the best 6

remedy. We also engage occasionally in offer of 7

compromise as prescribed by law, when circumstances 8

suggest that that might be a proper remedy. Should, 9

should we find it, that the taxpayer is unwilling to, 10

to work with us to, to correct their deficiency, we do 11

have some (unin) collection measures that we (unin). 12

One being a levy where we would seek to capture funds 13

that may be due in owning or belonging to the taxpayer 14

concession of a third party. So we might levy that 15

third party to, to have those funds directed to the 16

State Tax Department and (unin) to, to get… 17

Q. Let me stop you there and… 18

A. Sure. 19

Q. …ask you, what kind of third party (Unin)? 20

A. It could be a bank. It could be, it could be 21

a customer of our debtor. We also have something 22

similar to, to a levy, it’s called wage garnishment. 23

So if the, if the debtor is employed, for instance, we 24



can, we can garnish wages from the employer to satisfy, 1

comply to (unin). 2

Q. Let’s go back and flesh out how a payment 3

agreement works. How do payment agreements work? 4

A. Well, when it’s clear or when a taxpayer or 5

debtor makes it known or they’ve (unin) that they can’t 6

satisfy their obligation with one lump payment, we do, 7

we (unin) establishment payment agreements. There are 8

different levels and different authorities provided to 9

the people in the course of payment agreements. In 10

other words, those of lesser duration might be able to 11

be negotiated by an (Unin). Those of longer duration 12

use (unin) supervisor or (unin) director or assistant 13

director of the division depending on the length of the 14

terms. All of our agreements come with them a set of 15

terms and conditions which basically, I think, provide 16

a level of comfort to both the state and tax department 17

and the debtor that, you know while a payment agreement 18

is being complied with, the state will reframe from 19

course collection actions or things of that nature. 20

And the taxpayer then has a list of guidelines at which 21

to comply. It’s very clear and understood, these 22

agreements are, made in writing and signed, are to be 23

signed by, by the parties. 24



Q. And when you said that longer term agreements 1

have to be approved by, who do they have to, what 2

separates a shorter term agreement from a longer term 3

agreement? 4

A. Well… 5

Q. And how do they get approved? 6

A. Simply put, the number of months for the 7

duration of time that the agreement, that it will take 8

to satisfy the obligation. You know, for instance, her 9

policy is beyond 48 months or four years, we need the 10

direction of or the approval of the director, director 11

of division. Shorter term agreements don’t require 12

that level (unin). 13

Q. Now you mentioned earlier there was a, also a 14

mechanism called an offer in compromise? 15

A. Yes. 16

Q. What circumstances are those used in? 17

A. The law says that in cases where these is 18

doubt as to collectability, or doubt as to the 19

liability itself, that the department, tax commissioner 20

and the debtor can work towards a settlement amount. 21

It would obviously be based on, (unin) collectability, 22

the financial ability of the tax payer to pay or doubt 23

as to liability. Obviously, there would need to be 24



some evidence to show that the debt was improperly 1

calculated or certainly not the correct amount and 2

maybe a reduction would be warranted in that (unin). 3

Q. Okay, and, okay. Are there any other court 4

based remedies that are available? 5

A. Well, obviously, you know you’ve got your 6

revocation hearings but the code also recognizes that 7

failure to file and failure to pay or evading certain 8

taxes, trust fund taxes to be precise, are criminal 9

offenses, can either be a misdemeanor, or a felony 10

depending on the amount. Or, you know whether or not 11

evasion can be (unin). 12

Q. And when you say the criminal (Unin) tax, 13

which taxes are those? 14

A. Those would be your employer withholding tax 15

and your consumer sales tax. Taxes that are held in 16

trust by an employer or business and then turned over 17

to the state at prescribed times. 18

Q. And among all these remedies that you’ve 19

mentioned, levying, levying an account or reaching a 20

payment agreement, wage garnishment, an offer an 21

compromise, criminal prosecution, where does the, where 22

does the revocation of the business license fit in? 23

A. It’s typically not something that we want to 24



engage in early on when we’re working the case. But 1

the effect, the desired effect of a revocation is that 2

the business stops operating. And obviously that makes 3

it more difficult for us to collect the amount due the 4

state when the business isn’t generating income. So 5

we, we typically like to exhaust all other means of 6

colleting the debt before we, before we take that 7

action. 8

Q. Does the Tax Department ever accept payments 9

from a taxpayer who’s not in good standings without a 10

payment plan? 11

A. Sure. 12

Q. And describe to use the circumstances in 13

which that kind of thing (unin). 14

A. Well, it’s a partial payment. You know, you 15

know, it’s a fairly common thing. I mean tax payers 16

will file returns or, or make a payment towards debt 17

but that doesn’t, doesn’t imply that the, without an 18

agreement, we’ve not agreed or we’ve not authorized 19

that method but they do it all the time. Kind of like, 20

you know, I mean I could pay half my cable bills this 21

month but it would mean that the cable company is, I’m 22

in an agreement with the cable company to operate that 23

way. 24



Q. Are there any other kind of circumstances in 1

which the tax department might ask for a payment that 2

isn’t connected to a payment plan, an existing plan 3

(unin)? 4

A. Sure. Yeah we, I mean we can take a, let’s 5

assume that we’re in negotiations with a taxpayer for, 6

to establish terms of a payment plan. Okay we might, 7

we might suggest to a taxpayer that while we’re working 8

out those terms, because sometimes, you know, we 9

require financial information to establish the 10

appropriate amount of a monthly payment. That, you 11

know, it’s in the best interest of the tax payer to 12

make good base payments until we reach that agreement. 13

So sure, we’ll do that. 14

MS. FULTON: I have no further questions. 15

THE COURT: Okay. Mr. Yates, do you have any 16

questions for Mr. Oakes, this morning? 17

CROSS EXAMINATION: 18

Q. (Unin). Payment plan policy. You talked 19

about that, can you give us more details as to exactly 20

what it is? Like, what would happen when, by whom, and 21

such? Like how far does a revenue agent’s authority 22

extend than someone else made to take over? 23

A. Okay. I’d have to refresh my memory. It’s 24



been a long time since I reviewed the intricacies of 1

the payment plan policy. I got a copy… 2

MS. FULTON: If it will make it easier, we’re 3

going to call another witness to do that. 4

H: Okay, it’s already part of the record, 5

and I have it. They weren’t really that long. 6

THE COURT: Yeah, I… 7

H: (Unin) folder (unin). 8

Q. While I’m looking at that, is that an upper 9

limit as to what (unin) Tax can handle for a payment 10

plan? 11

A. It’s my understanding that there is. I think 12

there’s a cutoff beyond which the computer simply can’t 13

accept the duration. I’m not certain but I believe its 14

180 months which is quite a long, long agreement. 15

Q. Alright (unin). But actually part of her 16

original proposal at level II, she had it as an 17

attachment… 18

A. This might be it actually. (unin). 19

Q. (Unin). I think it’s like about two pages. 20

Is that about two? (Unin). 21

THE COURT: Okay, let the record reflect Mr. 22

Oakes has a copy of it in front of him, he’s using it 23

to refresh his recollection. (Unin) probably has it 24



committed to memory by now. 1

A. Okay, reading the, reading the agreement for 2

the (Unin) policy. The payment agreements that (unin) 3

12 month duration. The agents have the authority to go 4

ahead and enter into those agreements and actually 5

sign. If the payment agreement is in excess of 12 6

months they require a approval of a supervisor and a 7

submission of financial information. And as I stated 8

earlier, agreements 48 months actually need the 9

approval of the assistant director or the director for 10

those to be executed. 11

Q. I have one more question for you. 12

A. Yeah. 13

Q. Let me see which page (unin). 14

A. (unin). 15

Q. Do you (unin). Yes, okay, in this particular 16

paragraph which would be the bullet point where it says 17

payments and agreements of 12 months, the one below 18

that, the last couple of lines that start with all 19

payment agreements exceeding 12 months, would you 20

please read that? 21

A. Just that whole bullet point? 22

Q. No, no, just the starting there to the end 23

please. 24



A. Right here? 1

Q. Yes. 2

THE COURT: Do you want him to read it into 3

the record? 4

Q. Yes, into the record please. 5

A. All payment agreements exceeding 12 months 6

but not exceeding 48 months must be reviewed and signed 7

by the manger. Any payment agreement where the 8

requested terms exceed 48 months must be reviewed by 9

the assistant director prior to execution. 10

Q. Okay. Does that say I have the authority to 11

execute any payment plan basically over 12 months 12

because it must be signed by the manger? 13

A. Right. 14

Q. I have the authority to do that? 15

A. No, it must be signed by the manager. 16

Q. Okay. Okay. That’s all I have for that one. 17

And (unin). Okay. On the second (unin) compromise. 18

Which I don’t’ think was part of any of the record, I 19

have that, and this is directly out of our policies and 20

procedures manual. 21

A. Okay. 22

MS. FULTON: May I interrupt here? 23

THE COURT: Sure. 24



MS. FULTON: We’ve got this and we can put… 1

MR. YATES: We, do we already have it? 2

Because I don’t remember it being in there? 3

MS. FULTON: Oh no, I don’t have a, I don’t 4

have a copy of (Unin). 5

MR. YATES: You don’t have a copy? 6

THE COURT: Do you have a copy for Ms. 7

Fulton? Do you have an extra one for Mr. Oakes? If 8

you’re going to ask him questions about it. Do you 9

want me to mark this as your exhibit? 10

MR. YATES: Yes, please. 11

THE COURT: Okay, I’ll mark it as Grievant’s 12

Exhibit Number 1, level III. 13

(Grievant Exhibit number 1 marked for 14

identification) 15

MR. YATES: (Unin). 16

Q. Okay, on the second page, under section two, 17

and it’s titled, the offer and (unin) process, part A, 18

there’s that first paragraph that states the offer. 19

Would you please read that into the record? 20

A. The offer and compromise is a taxpayers 21

written proposal to the state and if accepted is an 22

agreement enforceable by either party under the law of 23

contracts. Therefore, the offer and it’s acceptance 24



must be definite in its terms and conditions. 1

Q. Okay, thank you. And now--What are the 2

requirements for an offer and compromise to be 3

approved? 4

A. Well they would, they would differ (unin) 5

depending on the individual situation but under the 6

code we have to demonstrate doubt as to what ability or 7

doubt as to (Unin). 8

Q. (Unin). 9

THE COURT: Mr. Yates, I’m going to pause the 10

record, you let me know when you’re ready. 11

(RECORDING PAUSED) 12

THE COURT: Okay, we’re back on the record. 13

Go ahead, Mr. Yates. 14

MR. YATES: I apparently do not have the 15

information I have been looking for so I cannot ask the 16

question I was going to ask, but I reserve the right to 17

ask that question again in the future for the purposes, 18

you know of (Unin). I wouldn’t necessarily say the 19

parties would need to be present, just a brief 20

telephone conversation. 21

THE COURT: They might stipulate to it as 22

well if you’re just asking questions about policy. 23

MR. YATES: Okay. 24



THE COURT: You can talk to Ms. Fulton about 1

that once, what is it? Do you know what you’re 2

missing? 3

MR. YATES: Yes. It was a list of 4

requirements, actual part of the policy that list 5

requirements for an offer and compromise that was in a 6

(unin) I actually have it cut out and taped to the 7

front of my desk so I can follow it. But I don’t’ 8

remember seeing it and I cannot put my fingers on it. 9

THE COURT: That’s okay. 10

MR. YATES: (Unin) summary. 11

THE COURT: That’s alright. Well, you can 12

bring that to the next hearing and if you want to offer 13

it as an exhibit at the next hearing. 14

MR. YATES: I, I would. I’ll have to look 15

for it. 16

THE COURT: Mr. Oakes might know what you’re 17

talking about but I don’t know (unin). Is it something 18

all fellow employees use or is it something you need 19

to… 20

MR. YATES: Yeah. Yeah. (unin). 21

THE COURT: That’s alright, do you have any 22

other questions for Mr. Oakes this morning? 23

MS. FULTON: I would, I object to the 24



admission of Grievant’s Exhibit 1. When I talked to 1

the legal counsel at, regarding offers and compromise, 2

because there is a large variation in what is 3

acceptable and what is not acceptable, they don’t deem 4

this document which has been submitted as Exhibit 1, 5

they don’t deem that as public. It is not a, it is not 6

a rule that’s been adopted under any rules and they, 7

the Department feels that the actual detailed thing 8

such as the list that Mr. Yates is talking about, are 9

not public documents. They would not like every 10

taxpayer to know exactly how to structure a case so 11

that they can get compromises approved. So, I don’t 12

have any objection to leaving on the record the parts 13

that he, that has been read but we do object to the 14

admission of this Grievant’s Exhibit 1 and to the list 15

that was being proposed to (Unin). 16

MR. YATES: If I remember most of the list 17

off the top of my head but I don’t have it. 18

MS. FULTON: That’s exactly what we’re 19

objecting to coming into the record. Not the document 20

but the information. 21

MR. YATES: It’s just a, the one point I was 22

going to point out, one of the requirements is, it must 23

be signed by the revenue agent. That is a requirement. 24



MS. FULTON: Well you don’t need the document 1

to prove that. If you ask the witness he’ll probably 2

tell you that. I mean, but we do not want the entire 3

set of procedures going into a record that going 4

(Unin). 5

MR. YATES: Which you… 6

MS. FULTON: That’s regarded as an internal 7

document that’s not open to the public. 8

MR. YATES: Would you object to not 9

necessarily putting the list that I am talking about in 10

but admitting to that one point if I do, if I can 11

provide you a copy of that list of the points that it 12

must be signed by the revenue agent. 13

MS. FULTON: We’re willing to stipulate, 14

well… 15

A. I’d like to see, you know, what he’s 16

referring to before I answer the question. (unin). 17

Q. I understand. I completely respect that and 18

I apologize that I don’t have that with me. 19

THE COURT: Well, we’ll have to take care of 20

that at a point after today’s hearing. And you don’t 21

have it. I’ve just marked this for identification 22

purposes, it’s a document called compliance division 23

offer and compromise policy and procedure. Do you have 24



any, see any need, Mr. Yates, for this whole document 1

to be made part of the record or just that part that 2

Mr. Oakes read into the record? 3

MR. YATES: Just that part Mr. Oakes read 4

(unin). I don’t have copies for everybody. 5

THE COURT: Because I’m, you know instead of 6

going through the long exercise of placing this under 7

seal and, I just assume handle it the way Ms. Fulton 8

suggested it. Mr. Oakes doesn’t want this to be made, 9

which conceivably could be made part of public record, 10

down the road. If that’s okay with you, Mr. Yates? As 11

long as you’re getting in what you want out of this 12

document, my understanding was, you know you have to 13

remember I’m here to talk about and hear evidence on 14

the written reprimand and I don’t know the facts as 15

well as you do but my understanding was that there was 16

an indication there was a payment plan entered into. I 17

didn’t hear, I didn’t remember anything about offering 18

compromise. 19

MR. YATES: She spoke to us about… 20

THE COURT: Just generally, yeah. 21

MR. YATES: Just generally. And my 22

contention of it is, is regarding the (unin) as my name 23

the offer of compromise memorandum as approval. 24



THE COURT: Is that part of this case? IS 1

that part of what led to your reprimand? 2


THE COURT: Is that part of what led to your 4

written reprimand? Do you… 5


THE COURT: …understand what I’m saying? 7

MR. YATES: (Unin) to the written reprimand. 8

(Unin). 9

THE COURT: I’m here to hear about the 10

written reprimand. 11

MS. FULTON: I might be able to make, I think 12

what he’s saying, that is part of his defense is that, 13

I think he’s saying that the fact that someone printed 14

his name onto an offer and compromise was an indication 15

that his, the person who issued the letter or reprimand 16

didn’t like him or treated him differently than someone 17

else… 18

THE COURT: Okay. 19

MS. FULTON:…as a defense. It’s not directly 20

related to the reprimand but arguable in dispute 21

(unin). 22

THE COURT: Why don’t we do this, Mr. Yates… 23

MR. YATES: (unin). 24



THE COURT: …well, if you have any more 1

questions for Mr. Oakes about the offer and compromise 2

policy that I’ve marked as Grievant’s exhibit number 1. 3

Anything else you want him to read into the record? 4

MR. YATES: No, I’m done. 5

THE COURT: Well, let me just give you the, 6

I’m going to grant the motion. I don’t think we need 7

to have the whole policy in the record because you were 8

able to get the pertinent parts that you felt, Mr. 9

Oakes read into that. Okay, so I’m going to grant the 10

motion and that’s not going to be admitted as an 11

exhibit in this case. Mr. Yates, do you have any more 12

questions for Mr. Oakes? 13

MR. YATES: No, I don’t. I’m sorry. 14

THE COURT: That’s alright, you, I’m not 15

trying to cut you off. I just wanted to let you know 16

that it was a motion made and I need to make a ruling 17

on the record, that’s all. If you, if you need a 18

couple minutes to review your material before we move 19

on the next witness I will be happy to give you that. 20

MR. YATES: Who do you plan on calling as 21

your next witness? 22

MS. FULTON: Mike Coutz. 23

MR. YATES: Mike Coutz, okay. 24



THE COURT: You don’t have any more questions 1

for Mr. Oakes at this time? 2

MR. YATES: No, I have no more questions for 3

Mr. Oakes. 4

THE COURT: Alright, let’s take a, I’m going 5

to pause the record. 6

RECORD PAUSED 7

THE COURT: Okay, we’re back on the record 8

and Mr. Coutz has been called as a witness to testify 9

on behalf of the respondent this morning. But before 10

you do so sir, I’ll need to swear you in. You can 11

remain seated but please raise your right hand. 12

(Witness sworn) 13

THE COURT: Go right ahead, Ms. Fulton. 14

DIRECT EXAMINATION 15

Q. What is, where do you work? 16

A. I work for West Virginia in the tax 17

department. 18

Q. And what is your job there? 19

A. I’m currently the acting director of the 20

compliance (unin). 21

Q. We earlier had some testimony that payment 22

plans that last more than 48 months require the 23

approval of the assistant director or the director. 24



Are you that person, are you one of those people? 1

A. Yes. 2

Q. Okay, so we’re talking about the director of 3

the compliance? 4

A. Yes. 5

Q. What is the job of the compliance department, 6

division? 7

A. The compliance division is responsible for 8

(unin) taxpayers, collecting delinquent taxes (unin) 9

collection activities. Generally promoting and 10

enforcing the state laws of West Virginia regarding tax 11

(unin). 12

Q. And how many employees are there to do this 13

job? 14

A. The current number of employees compliance 15

and tax (unin), probably over a hundred. Compliance 16

section, (unin) revenue agents (unin), taxpayers, and 17

customers and (unin). 18

Q. And do you know exactly how many (unin)? 19

A. (unin) revenue (unin)? 20

Q. Revenue. 21

A. 37 (unin). 22

Q. I am going to hand you what has been marked 23

as Tax Department’s exhibit 1, and ask you if you 24



recognize that? 1

A. Yes. 2

Q. What is that? 3

A. The organizational chart compliance division. 4

Q. And how recent is that chart? 5

A. It’s actually the March 5th 2011. 6

Q. And what do these revenue agents, how do they 7

conduct their, their collections (unin)? 8

A. Field revenue agents are responsible for 9

(unin). Working in the (unin) to try to get the 10

taxpayer to promote compliance with the law. But we 11

also have revenue agents who work in house, actually 12

don’t travel. 13

Q. And is this, does this chart show, is it a 14

true and accurate representation of people that are 15

(unin)… 16

A. Yes. 17

Q. …(unin)? 18

MS. FULTON: I move the entry of Exhibit 19

number 1. 20

THE COURT: Okay, Mr. Yates, any objection 21

the admission of this document? 22

MS. FULTON: Okay, it’s admitted. 23

24



(Tax Division’s Exhibit number 1 1

admitted into evidence) 2

Q. How many current cases does the compliance 3

division have open? 4

A. Last time I looked at it, well over (unin) 5

thousand. Those are (unin). 6

Q. When was that last time (unin)? 7

A. Yesterday. 8

Q. I’m handing you what’s been marked as Tax’s 9

Exhibit number 2 and ask you if you recognize this? 10

A. Yes. 11

Q. What is that? 12

THE COURT: Thank you. 13

A. That’s a report we use (unin). Identify the, 14

will have their (unin) cases and what (unin). 15

Q. And when you just testify, when was this 16

report printed? 17

A. I think yesterday. 18

Q. Okay. And so is that the source of your 19

testimony that there were 56,000 roughly, open cases? 20

A. Yeah. 21

Q. And could you explain about the unassigned 22

cases indicated on here, 17,000 (unin). 23

A. Yeah, a majority is unassigned cases. 24



Personal income tax. Our case (unin) just the amount 1

of debt incurred and we try to assign that and have our 2

staff work on the most pressing matters to where, the 3

most cost benefit can be gained by (unin) as possible. 4

Q. So this, this chart indicates an average case 5

load per, per RA, what’s RA? 6

A. Revenue Agent. 7

Q. And there’s a, one figure figure at the top 8

right that says (unin) and one at the bottom that says 9

1,382. Which one of these is, explain why there’s two 10

different figures and what that means. 11

A. The average case load for a revenue agent is 12

what has actually been assigned revenue agents. The 13

number at the bottom, 1,382 would be the amount that 14

all, if every case (unin), the 17,043 were assigned, 15

agents, that would, that would reflect the increase. 16

Q. Okay, so in terms of what the 966 means, are 17

you talking, is that the average case load that the 18

grievant would would have it had an average (unin)? Is 19

this a true and accurate copy of a report (unin). 20

A. Yes. 21

MS. FULTON: I move the admission of Exhibit 22

2. 23

THE COURT: Mr. Yates, any objection to the 24



admission of Exhibit 2? 1

MR. YATES: No, Sir. 2

THE COURT: Okay, it’s admitted. 3

(Tax’s Exhibit 2 admitted into evidence) 4

Q. Were you present at a revenue, a revocation 5

hearing that occurred on April 28, 2011? 6

A. Yes. 7

Q. And in what capacity were you there? 8

A. I was representing the West Virginia State 9

Tax Department. 10

Q. And when you say representing, what exactly 11

is your role in that kind of procedure? 12

A. From a management standpoint. Usually we 13

have a revenue agent come to the hearing and issues may 14

arrive that warrant some type of discussion between the 15

(unin) and (unin). 16

Q. And you aren’t considered the legal 17

representative? 18

A. No. 19

Q. Where there’s a (unin). What was the basis 20

of the revocation against this particular tax payer? 21

A. It was a show cause hearing of failure to 22

submit trust fund tax (unin). 23

Q. Were you present for the whole hearing? 24



A. Yes. 1

Q. What was the substance of, and was Mr. Yates 2

present at the hearing? 3

A. Yes. 4

Q. What was the substance of his testimony? 5

A. Substance meaning? 6

Q. What was the general, was was the general 7

(unin) his testimony? 8

A. The testimony was centered around the 9

taxpayer had not submitted taxes (unin) the state of 10

West Virginia and we were requesting that the business 11

license be revoked. Show cause (unin) the taxpayer 12

should no longer be operating. 13

Q. And was there evidence at that hearing that a 14

payment agreement? 15

A. Yes, (unin) testimony. 16

Q. And what was that testimony? 17

A. Mr. Yates testified that they payment 18

agreement had been (unin). 19

Q. And do you recall how many, how many payment 20

agreements he testified about? 21

A. Three. 22

Q. And after, and was, did he testify that the 23

taxpayer was in default on all three of these? 24



A. Yes. 1

Q. What happened after that testimony? 2

A. We took a small break and met with a legal 3

counsel and I asked Mr. Yates to go back to the revenue 4

center to produce the actual payment agreements. 5

Q. And why was it that you sent him to get the 6

payment agreements? 7

A. Because he did not have those with him 8

(unin). 9

Q. And had there been a request to have those, 10

those payment plans? 11

A. I think the judge had requested to see them, 12

if I remember correctly. 13

Q. Okay and so, and I understand is that you 14

instructed him to go back to the revenue (unin). 15

A. Yes. 16

Q. …and print it out? What do you mean by print 17

it out? What’s the (unin)? 18

A. Our computer system stores information where 19

if someone prints out information it will still be 20

(unin) and you can go print it out if we had at least 21

five payment agreements, print it out, make it 22

available to present at the hearing. 23

Q. And did Mr. Yates come back to the hearing? 24



A. He returned, yes. 1

Q. Did he have the payment agreements with him? 2

A. No ma’am. 3

Q. What happened next? 4

A. Next we had a meeting with our legal counsel 5

and made a determination based on not having signed 6

payment agreements that we would withdraw (unin). 7

Q. Why did the tax department decide to withdraw 8

the revocation issue? 9

A. Basically, because we did not have a 10

completed agreement with the customer’s signature 11

acknowledging that he accepted he terms which is 12

required by our procedures in any agreement. 13

MS. FULTON: I just marked the Tax 14

Department’s Exhibit 3 which is the official transcript 15

of the hearing. It was previously Tax Exhibit 1. 16

THE COURT: (Unin). Okay. 17

MS. FULTON: (Unin). 18

THE COURT: Bear with me. Alright, I have 19

that document. It’s been made a part of the file. 20

It’s marked as Respondent’s Exhibit number 1, level I, 21

I’ll just keep it as is. It’s titled official 22

transcript, evidentiary hearing held on April 28, 2011, 23

that the witness is testifying to. 24



(Respondent’s Exhibit 1, Level I, marked for 1

identification). 2

MS. FULTON: Do I need to move this back into 3

evidence? 4

THE COURT: No, it’s already been made a part 5

of the file. It’s a part of the file, level III. 6

Q. After the, after that proceeding was 7

dismissed by the Tax Department did you initiate any 8

disciplinary action? 9

A. Yes. 10

Q. And I’m now referring to what was Tax’s 11

Exhibit 2 (unin), the letter, it is a letter of 12

reprimand dated May 11th 2011. I’m pretty sure (Unin). 13

THE COURT: Yeah, that’s been made part of 14

the file as well so. 15

MS. FULTON: Tax number 2 (unin). 16

THE COURT: Yeah, it’s a May 11, 2011, 17

correspondence to Mr. Yates. 18

Q. I’ll show you what was Tax Exhibit 2 at Level 19

I and ask you if that’s the letter of reprimand that 20

you wrote? 21

A. Yes. 22

Q. What was the basis of the letter? 23

A. The letter… 24



Q. (unin) write it? 1

A. Well it revolved around two things; Mr. Yates 2

did not bring the case and information with him to the 3

hearing and (unin) testified under oath having payment 4

plan agreements (unin). 5

Q. Did the Tax Department recognize a payment 6

agreement that is not signed by the (unin)? Why are 7

employees required to bring their file to the hearing? 8

A. Just preparedness. Occasionally a customer 9

may bring up something or the judge that may not be 10

brought up before the hearing and it’s part of being 11

prepared (Unin). 12

Q. Have you previously, that’s already admitted. 13

THE COURT: Right, that’s been made part of 14

the file at Level III. It was previously marked 15

Exhibit number 2, the letter of reprimand. 16

MS. FULTON: The final exhibit we have for 17

this witness is, was formally Tax, Tax number 4, the 18

employee’s performance appraisal dated 11/21/08. 19

THE COURT: Yeah, that has also been made 20

part of the file at Level III, I have a copy of it. 21

The EPA? 22

MS. FULTON: Yeah. 23

Q. I’m showing you what’s been marked as, what 24



is Tex Exhibit 4 at Level I and ask you, are you the 1

person that performed that employee performance 2

appraisal of Mr. Yates? 3

A. Yes. 4

Q. And were you his direct supervisor at the 5

time? 6

A. Actually, we had a manager that was just an 7

added position (Unin). She hadn’t had enough time to 8

properly evaluate the work (Unin). 9

Q. And what, did you evaluate only Hudson? 10

A. No, every employee in that office if I 11

remember correctly. 12

Q. And which office was that? 13

A. Clarksburg (unin). 14

Q. Is Mr. Yates considered a part of that 15

office? 16

A. Yes, he’s actually situated in the (Unin) 17

office which is located in Elkins but reports to a 18

regional office manager (unin). 19


THE COURT: Okay, Mr. Yates, do you have any 21

questions for this witness? 22

MR. YATES: I do. 23

MS. FULTON: Those are the ones (unin). 24



THE COURT: Oh, okay. 1

CROSS EXAMINATION 2

Q. The transcript of the hearing (unin) file. 3

Would you please turn to page 18 and read lines 21 and 4

22? 5

THE COURT: He’ll have to get it in front of 6

him, if the witness doesn’t have it in front of him. 7

If he doesn’t have it, I’ll let the record reflect. 8

A. Line 21 and 22? 9

Q. On page 18. 10

A. Ms. Boyd, we have three time payment 11

agreements by them that have (Unin). 12

Q. Okay. The letter of reprimand is already on 13

record. You stated that I testified to that. 14

Apparently, according to this, is it not Ms. Boyd that 15

said that? 16

A. That’s not what I was referring to your 17

testimony. I would (unin) point out in the 18

documentation that (unin). 19

Q. You specifically used the word sign. 20

A. Sign means anything (unin). We use the term 21

payment agreements (Unin). 22

Q. Okay. 23

A. I’ll be glad to show you the transcripts 24



(Unin). 1

Q. Oh no, that’s perfectly alright. The Judge, 2

we’ve all read that. Let’s move to payment agreements. 3

Can you briefly tell us what a payment agreement is? 4

A. A payment is a verbal, verbal contract that 5

you modify in writing for the Tax Department has (unin) 6

agreement terms are agreed upon. 7

Q. Okay. What are some of the procedures 8

involving payment plan? 9

A. Procedures involve first initially 10

identifying debt, identifying what type of terms it’s 11

going to be, six months, 12 months 48 months, (Unin) 12

extended past that. (Unin) identifying the financial 13

ability of the customer to be able to meet that 14

modification. (Unin), so forth. 15

Q. Okay, on payment agreement, when does it need 16

to be approved and signed by a manger or supervisor? 17

A. Any payment agreement ultimately, (unin) 18

revenue agents (unin). Anything above 48 months has to 19

be brought to the assistant director or director 20

(unin). 21

Q. Okay, so your testimony is that a revenue 22

agent signs all payment agreements even if somebody 23

else would have to approve it, like say yourself 24



because it extended over the 48 months? 1

A. No, I’m saying you have a signature and 2

acknowledgement that we look at that we have (unin) Tax 3

Department and the customer. 4

Q. Okay. 5

A. Now his approval process was for the 6

different levels of (unin). 7

Q. Okay, let’s say there’s a payment agreement 8

for 49 months. Who signs it? 9

A. The manager actually has (Unin) the assistant 10

director. 11

Q. Okay. 12

A. Has to approve them first. 13

Q. Okay, 47 months? 14

A. It’s within the discretion of the manager on 15

(unin). 16

Q. Okay. Do you still have a copy of the 17

(Unin). 18

A. (Unin). 19

Q. You do? 20

MS. FULTON: The what? 21

Q. The payment agreement (unin). 22

MS. FULTON: (Unin). 23

MR. YATES: Part of the, I have it attached 24



to the letter I (Unin). 1

MS. FULTON: Oh. 2

MR. YATES: The payment agreement policy. 3

THE COURT: Go off the record for a second 4

and just let me know when - 5

(RECORD PAUSED) 6


and Mr. Yates has directed the witness’s attention to 8

page 3 of the, a policy relating to payment plants. 9

Q. The very top line on page 3, would you please 10

read that? 11

A. Liability is a lean against… 12

Q. No. I apologize, line, page 2, page 2. I 13

apologize, page 2, very top line. 14

A. Revenue agents will have the authority to 15

counter (unin) formal payment agreement where (unin) 16

require the balance due to be paid within 12 months. 17

Q. Is that the limitations that a revenue agent 18

has to sign on a payment agreement? 19

A. (unin) policy. 20

Q. Okay. 21

A. That’s under the 12 month policy agreement, 22

that’s (unin) to that. 23

Q. Okay, so would you please go to the second 24



full paragraph, it would actually be the third section 1

down. From that to, three lines up from the bottom of 2

that where it says all payment agreements exceeding, 3

would you please read that? 4

A. All payment agreements (unin) 12 months but 5

not exceeding 48 months must be reviewed and signed by 6

the manager. 7

Q. Okay. Do you directly supervise any revenue 8

agents? 9

A. Yes. 10

Q. Who? 11

A. (Unin). 12

Q. How many payment agreements over 12 months 13

have you signed for her as her manager? 14

A. Not that (Unin). 15

Q. Did you have a conversation with her when she 16

asked you about that and I’m paraphrasing, not making 17

an exact quote that basically you couldn’t be bothered 18

with that? 19

A. NO, that’s incorrect. 20

Q. So when I called in Ms. (Unin) she would 21

testify that I’m making that up? 22

A. I don’t’ know what she would testify to 23

(Unin). 24



Q. So if she did say that would you say she 1

would be lying? 2

A. It’s not my place to say what she’d thing. I 3

know what I know. 4

THE COURT: Yeah, you’re just making a 5

proffer, Mr. Yates, there’s no testimony that what, you 6

could challenge as being previously inconsistent or 7

not, you just made a proffer and the witness has 8

indicated he doesn’t have any idea (unin). 9

MR. YATES: Okay. 10

THE COURT: What was the, what was the name 11

of the witness? I didn’t catch it. 12

MR. YATES: (Unin) Swindler. 13

THE COURT: Swindler, okay, thank you. I 14

didn’t… 15

MR. YATES: I’m don’t’ with the witness. 16

THE COURT: Okay, any other redirect, Ms. 17

Fulton? 18

MS. FULTON: No. 19

THE COURT: Okay, thank you Mr. Coutz, what’s 20

next Ms. Fulton? 21

MS. FULTON: Kim Silvester. 22

THE COURT: Okay. Okay, we’re back on the 23

record and Ms. Silvester has joined us to testify on 24



behalf of the Respondent. Good morning Ms. Silvester. 1

MS. SILVESTER: Good morning. 2

THE COURT: My name is Ron Reece, 3

Administrative Law Judge assigned by the Grievance 4

board to conduct this hearing. Before you testify 5

ma’am, I’ll need to swear you in. You can remain 6

seated but please raise your right hand. 7

(Witness sworn) 8

THE COURT: Go right ahead Ms. Fulton. 9

DIRECT TESTIMONY 10

Q. Where do you work Ms. Silvester? 11

A. I work in the North Central Regional Office, 12

Compliance Division. 13

Q. (Unin). 14

A. Yes. 15

Q. And what is your position there? 16

A. I am the tax regional supervisor. 17

Q. And who do you supervise, what kind of 18

employees do you supervise? 19

A. Revenue agents. I have one revenue agent 20

(Unin). 21

Q. And are you Mr. Hudson Yate’s direct 22

supervisor? 23

A. (Unin). 24



Q. What kind of--Can you explain to us how an 1

offer to compromise is set up? 2

A. An offer and compromise is a collection tool 3

used by the Division in instances where there is doubt 4

that the liability or valid possibly or maybe a 5

combination of both. 6

Q. And how does, how would a, how would such an 7

offer get made? 8

A. Initially the taxpayer would work with the 9

revenue agent (unin). It would be discussed. The 10

revenue agent would look to the taxpayer to get initial 11

paperwork. There is an offer and compromise form that 12

(unin) complete. On that form they would actually list 13

the amount they they’re offering. It would have the 14

tax (unin) under the compromise (unin) as well as the 15

period to cover, total the tax, insurance, penalty, and 16

a grand total. That form would also (unin) 17

information. If the taxpayer was going to make a 18

payment with the offer, make a payment upon acceptance 19

of the offer or (unin) and then the taxpayer would have 20

to sign that. 21

Q. And what kind of proof does the taxpayer have 22

to provide to the revenue agent to get a (unin)? 23

A. If there is doubt of the collectability, we 24



collect financial statements from the taxpayer, form 1

433-A from the (unin) or 433-B for businesses. The 2

revenue agent, their goal would be to (unin). If there 3

is doubt of collectability, the taxpayer would need to 4

provide proof and (unin) saying they (unin) liabilities 5

(unin). 6

Q. And what’s the procedure or the steps that--7

Let me back up, I’m not sure I got everything. What 8

are the, what are the options to pay (unin)? 9

A. (Unin), they can make an initial payment with 10

the offer, make the payment with the offer or payment 11

on acceptance of the offer, or, (Unin) the payments on 12

(Unin). 13

Q. And when you say payments with the offer, are 14

you saying that they offer x number of dollars and then 15

the proffer a payment of x number of dollars? 16

A. Right. (Unin). They are offering $50,000.00 17

to settle their, their case, they make that payment 18

with the offer. 19

Q. And what they, once that information gets 20

gathered and all the forms are together., what’s the 21

procedure for getting, for getting such an offer 22

approved? 23

A. Again, initially, the revenue agent would get 24



the paperwork, maybe sure everything is in (Unin). If 1

they think that it’s a good offer they would then 2

forward that paperwork to me. I would review it, the 3

revenue agent would also make sure all facts were 4

(unin) because the offer would have to (unin). But 5

again they would get that paperwork to me, I would 6

review it. If It think everything is in order I would 7

sign off on it or recommend it from there we would get 8

it to Charleston, my Division director, or 9

consideration. From there, if he think it’s a good 10

offer it will go to legal counsel for consideration and 11

then ultimately get the (unin). 12

Q. So, when you say your director, are you 13

talking about Mr. Coutz? 14

A. Yes. 15

Q. Compliance (unin)? 16

A. Yea. 17

Q. The Compliance Division, correct? 18

A. The revenue agents have a (unin). They can 19

recommend here. 20

Q. Do you have any authority to the (unin) 21

office? 22

A. No. (Unin) recommend, (unin) recommend the 23

offer for consideration but I have no authority to 24



approve (unin). 1

Q. And what happens if the revenue agent gets an 2

offer but doesn’t (unin). 3

A. A revenue agent could deny it if they don’t 4

think it’s a good offer or maybe the taxpayer has not 5

completed the paperwork properly. If we don’t have 6

enough information (unin), they can actually deny the 7

offer (unin) simple matter that we need additional 8

information or they don’t feel it’s in the best 9

interest of the (unin). As (unin). 10

MS. FULTON: I don’t think this is part of 11

the record. It may be somewhere but… 12

Q. I’m handing you what’s been marked Tax 13

Exhibit number 3, which is a three-page heavily 14

redacted document. Which has, slightly below the 15

middle it’s got Hudson Yate’s name. Do you know how 16

and--let me ask you, is that your signature to the 17

right where it says unit manager? 18

A. Yes, that is my (unin). 19

Q. And is that Hudson Yate’s signature there to 20

the left? 21

A. (Unin). 22

Q. Do you know how it was, happened to be that 23

your signature would be on there but (Unin) would not? 24



A. As the supervisor I’m, being involved in the 1

(unin) the agency and collection papers. Sometimes in 2

doing so the taxpayer will send me documents directly 3

and I believe that’s what happened in this case. We 4

were discussing (unin) compromise and taxpayer simply 5

sent it to me (unin). I reviewed it, (unin) the offer 6

(unin) consideration and I, I signed off on it and sent 7

it on to Charleston. 8

Q. And so at the time you sent it to Charleston 9

was the tax division’s employee line where the (unin) 10

is now printed, was it blank when you went it to 11

Charleston? 12

A. It was blank, yes. 13

Q. And do you know what happened to it after 14

that? 15

A. Not really. 16

Q. Okay. (Unin). If you had approved an offer 17

and--strike that. If you had recommended an offer and 18

compromise based on information that you received 19

directly from the taxpayer was there any requirement 20

that Mr. Yates sign it? 21

A. (Unin). 22

Q. Would the, could you look at the other two 23

pages that, that are attached here and tell us whether 24



that is your signature on the, for unit manager? 1

A. Yes, that is my signature. 2

Q. And do you recall these? 3

A. I know they’re redacted, but it’s possible 4

but (unin) again I would say what happened is that I 5

became involved in the offer and compromise process 6

(unin) taxpayer (unin) sent me the paperwork and I just 7

expedite the process I went ahead and sent them to 8

Charleston for consideration. 9

MS. FULTON: I’d move the admission… 10

Q. With the exception that Hudson Yate’s name 11

was not on there at the time, it’s a true and accurate 12

copy that (unin) reacted, it’s a true and accurate copy 13

of what recall seeing? 14

A. (unin). 15

MS. FULTON: I move the admission of Tax 16

Exhibit Number 3. 17

THE COURT: Okay, any objection Mr. Yates to 18

the admission of this document? 19


THE COURT: Okay, it’s admitted. 21

(Tax’s Exhibit 3 admitted into the 22

record) 23

Q. Okay, did you have any contact with Mr. Yates 24



at the time of the revocation hearing that was subject 1

of this reprimand? 2

A. Prior to, yes. 3

Q. And what was that contact? 4

A. I know we spoke by phone but there were 5

varied emails as well. 6

Q. And I’m going to hand you what’s been marked 7

as, I don’t have it marked yet. This is Grievant’s 8

Exhibit 1 below but we would like to admit here. So I 9

guess we could just, we’ll just mark it Grievant’s 10

Exhibit 1, Level I. 11

THE COURT: That’s fine. I, I probably have 12

a copy of it already. 13

MS. FULTON: Here’s one just in case. 14

THE COURT: Okay, thank you sir. Yeah, I’ll 15

mark this, well Ms. Fulton has already marked it as 16

Grievant’s Exhibit number 1, Level I. Looks like I 17

have a, I already have a copy of it as well. So it’s 18

already been made part of the file. 19

Q. I’m showing you now what was marked as 20

Grievant’s Exhibit 1 (unin). And ask you to flip to 21

the, I’m counting from the back, one, two, three, four, 22

seven. To the page, at the top it’s marked page 203 23

and it has an email that says Kim A Silvester, from Kim 24



A. Silvester to Danielle E. Boyd. And it’s dated April 1

20th. 2

A. Okay. 3

Q. Do you, do you recall sending that email? 4

A. Yes. 5

Q. And in that email you state that, well let me 6

ask you, why did you write this email? 7

A. I believe prior to the hearing there was a 8

conference between the taxpayer, the state attorney, 9

and the office of tax appeals, Danielle (unin) per that 10

conversation. 11

Q. And who is Danielle? 12

A. Danielle Boyd, she was the attorney with the 13

tax (unin) during revocation. 14

Q. And why was she following up with you? 15

A. I believe the taxpayer mentioned they wanted 16

(unin) something to that effect. 17

Q. And in this letter you state that they had 18

already entered into a payment agreement? 19

A. (unin). 20

Q. And what made you believe that they had 21

entered into a payment agreement? 22

A. In our system, our integrated tax system 23

there is a (unin) manager. As a user I can go in on 24



pretty much any account and pull up any letter that’s 1

it has generated on that account. I did go into a 2

particular sales tax account for this taxpayer and 3

there was a payment plan that was generated on that 4

account. 5

Q. And did you check to verify that it had been 6

signed? 7

A. No, I, (Unin) the signatures (unin). 8

Q. Have you checked it since? Have you checked 9

that account since? Have you seen that letter since? 10

A. Oh yes, mm-hmm. 11

Q. And is it signed? 12

A. No. 13

Q. What was the payment plan? Let me ask you, 14

what is GenTax? 15

A. GenTax is our integrated tax (unin). 16

Q. What, what kind of data is kept there? 17

A. Taxpayer data with names, addresses, account 18

numbers, individuals we have records of personal income 19

tax information, businesses that are registered, 20

various taxes the businesses are subject to. Filings 21

(Unin). 22

Q. And what does a payment plan look like in 23

GenTax? 24



A. One generated through GenTax, once printed it 1

would have of course the taxpayer name and address, an 2

account number, it will (unin) the tax type covered by 3

the payment plan as well as periods covered by the 4

payment plan. It will also show the taxes, penalty 5

(unin) paid by the taxpayer over the course of the 6

(Unin). And a revenue agent would have to input if the 7

taxpayer is making a down payment, that would be 8

reflected when (Unin). Generally there’s a discussion 9

of the amount to be paid. That amount would be entered 10

and then the system will calculate the number of months 11

it will take to cover, to pay the liability based on a 12

monthly payment entered. It will give the, the due 13

date of the first payment. Then there’s a voucher at 14

the bottom of the first page for the taxpayer to make 15

the first payment. The next page there would be terms 16

and conditions of the payment plan, as well as a 17

signature page for both the revenue agent and the 18

taxpayer’s to sign and date. There is (unin) schedule 19

that shows the taxpayer each due date of the, the 20

payment and the balance (unin). 21

Q. How does a, how does a revenue agent get--Let 22

me back up. If the data you were just talking about, 23

the first, the amount of the monthly installment, how 24



many months the plan would go for, the amount of the 1

first payment and the (unin) schedule, can that all be 2

done direct, directly input into the computer? 3

A. Yes. I mean that’s, and that’s, the revenue 4

agent would obtain that information in dealing with the 5

taxpayer and again there would be original (Unin) 6

payment. The taxpayer might say they can only pay 7

$500.00 a month, that would be entered into the system 8

and again the system would calculate the number of 9

months it would take to pay at that, at that monthly 10

installment amount. 11

Q. And what about the signature page for the 12

revenue agent and the taxpayer. How, how does that get 13

input into (unin)? 14

A. Of course when the payment agreement is 15

initially generated from the system it is blank. Then 16

the revenue agent and the taxpayer would sign it. Then 17

it’s (unin) attached. And attached to that particular 18

account (unin). 19

Q. Getting back to the hearing that caused, that 20

was the, that caused this reprimand. And referring you 21

to the third page (unin) or of this Exhibit, Grievant’s 22

Exhibit 1 at Level I. I’m on, it’s third page from the 23

front. 24



MR. YATES: From the front. 1

Q. We’re looking at… 2

MR. YATES: (Unin) third page from the front. 3

What’s the very top of it (unin)? 4

MS. FULTON: The very top of it says (unin) 5

it’s the (unin). 6

MR. YATES: What’s the date? 7

MS. FULTON: It is, Wednesday, April 27th. 8

From Kim Silvester to Hudson Yates, that’s not this 9

(unin). Oh okay. (Unin), I’ve got two (unin). 10

MR. YATES: I (Unin). 11

MS. FULTON: That’s it right there. 12

MR. YATES: Okay, that’s my page 2. Okay. 13

MS. FULTON: Okay, sorry. 14

Q. When you testified just now that you had some 15

emails from Hudson Yates in connection with the 16

grievance hearing, are they the emails to which you 17

referred? 18

A. Yes. 19

Q. And in your email to him, when you said, have 20

your notes regarding contact pay plan set up, etcetera, 21

what did you mean by that? 22

A. Contacts, I mean, during a course of working-23

-Well, I’ll back up. The revenue agent literally has 24



hundreds of collection cases that they work. Just, in 1

my opinion (unin) the documented conversations because 2

there are going to be many conversations. (unin) 3

documentation. (Unin) revenue agent and the taxpayer, 4

often will give them a deadline to gather certain 5

information. So that’s what I, when I said regarding 6

contacts, the number of maybe telephones conversations, 7

telephone conversations that had taken place (unin) 8

Hudson would have to go visit the taxpayer or contact 9

(unin) the taxpayer actually went to the, the (unin) 10

office. 11

Q. And do revenue agents typically keep dates in 12

paper form or in the computer (unin)? 13

A. It can be done either way. If it’s, you 14

manually make a note you would just keep that in a 15

file. If it’s done in GenTax, it can be up to exported 16

to a Word document and printed. 17

Q. And when you were referring, when you, in 18

your email you talk about have your notes regarding 19

contacts pay plan, what did you mean by play plan? 20

A. A copy of the payment agreement for that 21

(unin). 22

Q. Now looking at the very first page of that 23

document that you got from Hudson (unin), Hudson Yates 24



from you. This is May 3rd 2011. 1

MR. YATES: What’s the (unin). 2

MS. FULTON: I put a compliance non-renewal. 3

MR. YATES: Okay. 4

A. Okay. 5

Q. Got it? 6

A. Yes. 7


Q. Looking at that term a compliance non-renewal 9

indicator. 10

A. Yes. 11

Q. What is that? 12

A. At that time we would like (unin) every two 13

years. In this case since we were not able to revoke 14

that business license, I wanted to be sure that they 15

were not given a new license, since they were not in 16

compliance. We can’t place an indicator on the account 17

and so the compliance (unin) non-renewal is the correct 18

term. And any user of the system would see that 19

indicator and know that that (unin) should not be 20

issued (unin). And that’s to prevent them from going 21

to a, maybe another regional office or anywhere else 22

and just trying to go around us. 23

Q. So once it has that indicator on it then, 24



would anybody in the compliance division would be able 1

to see that this should not, this business should not 2

be issued a (unin). 3

A. Not just within the compliance division but 4

the tax department (unin). 5

Q. Had Hudson Yates, prior to this revocation 6

hearing, had he ever had previous hearings? 7

A. I believe so, yes. 8

Q. And do you recall how many he had had? Two? 9

A. I think earlier in 2011 (unin). 10

Q. And were there any (unin)? 11

A. None that I know. 12

Q. Does the department ever accept tax (unin) 13

not connected to a payment plan? In other words, 14

somebody is behind on their account, do they ever make 15

payments that are not connected to an approved payment 16

plan? 17

A. Yes. (Unin). 18

Q. What kind of circumstances (Unin)? 19

A. Maybe during the negotiation process (unin) 20

trying to negotiate a payment plan, taxpayer will give 21

you (unin). Ironically, sometimes taxpayers will just 22

(Unin) they have some extra money they’ll (unin). We 23

accept it. (Unin) payment plan (unin). 24



Q. Why is it required that a payment (Unin)? 1

A. (Unin) agreement (Unin). 2

Q. And if there had been a payment plan in 3

effect at the time of this hearing would it, would it 4

have been (unin)? 5

A. Generally they are. Sometimes (Unin) might 6

go for more months and (Unin) calculate through our 7

system. In that case (unin) recommend (Unin). 8

Q. How is a manual (unin)? 9

A. Literally just that. It is a, it’s a paper 10

copy, form used actually prior to GenTax but it 11

contains pretty much the same information; taxpayer 12

name and address, account number, the types of tax 13

covered by the (Unin). 14

Q. Is the approval for that any different from 15

(unin)? 16

A. No. 17


THE COURT: Okay, Mr. Yates, do you have any 19

questions for Ms. Silvester? 20

MR. YATES: I do. 21

CROSS EXAMINATION: 22

Q. Referring to the copy she provided to you 23

regarding the offer and compromise, okay you pretty 24



much said that you most likely, I mean I can tell you 1

who they were and you would know, but I can’t right 2

now. But, would it be safe to say that you most likely 3

prepared these documents without my signature? 4

A. Yes. (Unin). 5

Q. And then you would have submitted them on for 6

further approval or denial? 7

A. Right. 8

Q. Correct? 9

A. That’s correct. 10

Q. Is there a reason that you didn’t put my name 11

on it and you just left it blank? 12

A. Like I said, just to expedite the process. I 13

go the information, I reviewed it, thought it was a 14

good offer and just sent it on to Charleston. 15

Q. But you didn’t see the need in putting my 16

name on it? 17

A. No. 18

Q. What would be your reaction if an offer and 19

compromise was initiated and you didn’t have any hand 20

in preparing it or such and your name was applied to 21

it? 22

A. My name printed it or a signature? 23

Q. Either or. (unin) however you… 24



A. Well, I mean it… 1

Q. How about the same style that mine was 2

applied there, let’s go with that. 3

A. I mean honestly, it wouldn’t (unin) if 4

someone wrote my name there and you’re not signing the 5

form. They’re just recognizing that I’m (unin). 6

Q. Okay. Has anybody done that for you? 7

A. Not that I’m aware of. 8

Q. Can you check? 9

A. No. 10

Q. Well, I have. And I would like to, before I 11

go further I see that based upon Ms. Fulton’s copy, 12

she’s redacted a lot more information than I have on 13

these. So, I would request that before this be put 14

forward that, you know, they would be checked to make 15

sure they’re thoroughly redacted because I, you know, 16

I’m not an attorney. I redacted what I felt was more 17

identifying. 18

THE COURT: Well, I’m not really getting your 19

point. I mean I’m getting your point on the redaction 20

but can you just merely proffer to Ms. Silvester that 21

on such and such a date an offer of compromise was 22

submitted for approval? 23

MR. YATES: I can, and may, am I allowed to 24



show her? 1

THE COURT: Yeah, you can show her, that’s 2

fine. It’s (Unin). 3


THE COURT: Let me, I got to, I got to take a 5

break so I’m going to - 6

RECORD PAUSED 7


and the parties have redacted a document that I’ve 9

marked as Grievant’s Exhibit number 1, Level III. Go 10

ahead, Mr. Yates. 11

(Grievant’s( Exhibit number 1 marked for 12

identification) 13

Q. Okay. (Unin), you indicated that you did not 14

know that this had happened and that you wouldn’t 15

necessarily be upset, per say, that your name was 16

applied but how did you feel that you didn’t’ know 17

about it, that it was never mentioned to you that this 18

was being done? 19

A. I mean, again, honestly it doesn’t bother me. 20

I would recommend the offer anyway. 21

Q. Okay. 22

A. And it wasn’t my signature. 23

Q. Right, right, okay. But what if you didn’t 24



recommend the offer? 1

MS. FULTON: Objection (unin). 2

THE COURT: That’s overruled. He’s just 3

asking, asking her a hypothetical. I take it there’s 4

some mechanism that once you found, if you found out 5

this document had been submitted for approval you could 6

lodge a, whether a comment of whether you recommend it 7

or not. 8

A. Sure, I mean I would want to know why I 9

wasn’t approving it, if I didn’t think it was, I would 10

really want to know why (unin) an offer, a good offer 11

when I didn’t. 12

Q. Okay. 13

THE COURT: Is that what happened with Mr. 14

Yates, did he not recommend the previous exhibit that 15

we had discussed where you had written his name in? 16

A. Not… 17

MR. YATES: Not, she didn’t write my name in. 18

THE COURT: Oh, okay. 19

A. And not that I’m aware, like I said through 20

working with the taxpayer I believe they just sent the 21

information to me… 22

THE COURT: Okay. 23

A. …instead of sending it to him. In a matter 24



of logistics we (unin). 1

THE COURT: Okay, alright. 2

A. …sent it on to Charleston. 3

THE COURT: Alright, thank you. Go ahead, 4

Mr. Yates, (unin). 5

MR. YATES: I’m sure Ms. Fulton will have an 6

objection but may I make a comment on the three in 7

question that were done? 8

THE COURT: Well, you’re probably need to 9

reserve that for when you present your case in chief 10

because you’re not under oath right now. 11

MR. YATES: Okay. 12

THE COURT: Why don’t we do it that way. 13

MR. YATES: Okay. 14

THE COURT: I mean, I don’t know what Ms. 15

Fulton, I couldn’t let you, it would just be a, it’d 16

just be a proffer. If you want to give sworn testimony 17

we’ll have to swear you in. 18

MR. YATES: No that’s quite alright. 19

THE COURT: We can do that, we’re flexible. 20

MR. YATES: That’s quite alright. I’m done 21

with that one. 22

Q. Let’s go back to payment plans. Did you give 23

her a copy of the one that you had, I mean I have more 24



(unin) payment plans. 1

MS. FULTON: What exhibit are you talking 2

about? 3

MR. YATES: I’m not sure what number it is. 4

It’s whatever, it was already part of the file that we 5

agreed to, you’re (unin) statement where you’ve 6

attached the payment plan policy. I mean I questioned 7

Jeff with it, Mike with it. I mean I have copies I can 8

give her, I just want to, you know you already have it. 9

I have it, I can (unin) refer to (unin). 10

MS. FULTON: I think it was attached to my 11

proposal and (unin) agreement. 12

MR. YATES: Just the payment plan. Yes, yes, 13

yes it is. 14

THE COURT: There’s a copy right here. It’s 15

not marked exhibit or anything. 16

MS. FULTON: Yeah, but wait, never mind, I’ve 17

got it. 18

THE COURT: Okay. 19

MS. FULTON: Okay. 20

MR. YATES: I mean if it’s just the payment 21

plan in general that’s all I need her to look at. 22

MS. FULTON: Okay, go ahead and (unin). 23

MR. YATES: Yeah, if it’s not stapled to 24



anything else I just wanted to… 1

THE COURT: Just this. 2

MR. YATES: Right. But since it’s already 3

part of the, you know the docket. 4

Q. What are the general terms of a payment plan? 5

A. All tax returns would have to be filed. The 6

taxpayer would have to stay current and that means in 7

addition to making the monthly payment plan payment 8

they would have to file and pay all required (unin). 9

Q. Okay. At what stage does a revenue agent 10

need to have a (unin)? 11

A. Well any.. 12

Q. Like, after I, after x number of months or, 13

or such? 14

A. A payment plan over 48 months has to be 15

written in Charleston and (unin). 16

Q. And under 48, say 47 or less? 17

A. I mean you should (unin) confer with your 18

unit leader but we can execute a payment agreement 19

under 48 months at the regional offices. 20

Q. Okay. In that payment plan would you please 21

turn to, it would be the second page and the first 22

bullet point where it--I’m sorry, back up. Right above 23

that first bullet point where it read (Unin), would you 24



please read that? 1

A. (Unin) will have the authority to countersign 2

any formal payment agreement where the terms require, 3

require a (unin). 4

Q. Okay, would you please move down to (Unin) it 5

would be the second full paragraph but it would be the 6

third section where it, the section that begins the 7

financial information. 8

A. Okay. 9

Q. Skip down towards the end where you say all 10

payment agreements exceeding, I believe it’s the third 11

line up from the bottom of that paragraph, and please 12

read that. 13

A. All payment plans, excuse me, all payment 14

agreements exceeding 12 months but not exceeding 48 15

months must be reviewed and signed by the manager. 16

Q. Okay, how many revenue agents do you 17

supervise? 18

A. Five. 19

Q. Five? And how often do payment plans exceed 20

12 months? 21

A. In a lot of cases. 22

Q. In a lot of cases, have you signed any of 23

them? 24



A. No, but they’ve always been in contact with 1

me on (unin) agents (unin). But no, I haven I have not 2

signed (unin). 3

Q. Okay. 4

MR. YATES: That’s all I have. 5

THE COURT: Okay, any redirect, Ms. Fulton? 6

MS. FULTON: I just have one brief redirect. 7

REDIRECT EXAMINATION 8

Q. Grievant’s Exhibit number 2, this two page 9

document, does the fact that you had a cover letter 10

with it indicate that you approved this offer? 11

A. Yes, I always use a cover letter (unin). 12

MS. FULTON: No further questions. 13

THE COURT: Okay, Mr. Yates, you move the 14

admission of Grievant’s number 1? This is the redacted 15

copy. Any objection to it being made a part of the 16

file? 17

MS. FULTON: No. 18

THE COURT: Okay, it’s made a part of the 19

file. 20

MS. FULTON: I’m sorry, a question about the 21

number. It’s number 1? 22

THE COURT: Yeah, I labeled it number 1. I’m 23

going to scratch the previous number one since it was 24



objected to and Mr. Yates agreed to withdraw it with 1

the recognition that Mr. Oakes read the pertinent parts 2

into the record. 3

(Grievant’s Exhibit 1 admitted into 4

evidence) 5

Okay, any more questions for Ms. Silvester? 6

Anything else? 7

MR. YATES: I have no (unin). 8

THE COURT: Okay, what’s next Ms. Fulton? 9

Are you going to take the testimony of Mr. (Unin)? 10

MS. FULTON: I’ve got Mr. Shaw… 11

THE COURT: Mr. Shaw. 12

MS. FULTON: And it will be really brief. 13

THE COURT: Okay, Mr. Shaw. Would you do us 14

a huge favor and send him in? Thank you. 15

RECORD PAUSED 16

Okay, we’re back on the record and Mr. Shaw 17

has joined us to testify on behalf of the respondent. 18

Good afternoon, Mr. Shaw. My name is Ron Reece, I’m 19

the administrative Law Judge assigned to conduct this 20

hearing and author a decision in Mr. Yates grievance. 21

You’ve been called to testify on behalf of the Tax 22

Department but before you do I’ll need to swear you in. 23

You can remain seated but please raise your right hand. 24



(Witness sworn) 1

THE COURT: Thank you sir, go right ahead Ms. 2

Fulton. 3

DIRECT EXAMINATION 4

Q. What is, where do you work, Mr. Shaw? 5

A. I work for the North Central Regional Office 6

(unin) Tax Department. 7

Q. And what is your title there (unin). 8

A. Revenue Agent 2. 9

Q. Is that the same job that Mr. Yates has? 10

A. Yes it is. 11

Q. (Unin). Are you part of the Compliance 12

Division? 13

A. Yes I am. 14

Q. Did you attend an October 2009 annual meeting 15

of the Compliance Division? 16

A. Yes I did. 17

Q. I’m handing you what’s been marked Tax 18

Exhibit number 3, (Unin) off the record a minute Judge 19

but I think this is… 20

THE COURT: Hold on. 21

RECORD PAUSED 22

Q. Showing you what’s been marked Tax Exhibit 23

number 3 at level I and ask you, do you recall that 24



Compliance Division meeting? 1

A. Yes I do. 2

Q. Were you present at it? 3

A. Yes I was. 4

Q. And looking down the the 11:00 to 11:30 slot, 5

business revocation (unin). 6

A. Yes, I remember that. 7

Q. Were, you were present for that? 8

A. Yes. 9

Q. What was the, what was the, what was that 10

workshop or presentation about? 11

A. It was an overview of business revocation 12

process from start to (unin). 13

Q. And, okay and moving on to the third page of 14

this handout, in flipping through it, do you recognize 15

these documents? 16

A. Yes I do. 17

Q. And what are they? 18

A. Those are the policies and codes of business 19

revocation acts. 20

Q. And were they distributed at that 11:00 to 21

11:30 presentation? 22

A. Yes. 23

Q. And did you receive a copy? 24



A. Yes I did. 1

Q. Do you recall any particulars about the, the 2

presentation? 3

A. Basically it went over the, you know, process 4

of, like I said, you know, working the cases and we 5

have business revocation, you know, and what we’ve done 6

on each case. And, you know, I know they address 7

payment plans. I do remember the (unin) saying that, 8

going payment plants, as far as that goes if they 9

weren’t signed then we didn’t have one. I remember 10

that being said that that meeting. 11

Q. Are there occasions on which you as a revenue 12

agent received (unin) payments without the payment 13

agreement? 14

A. Yes I do, (Unin) from different tax payers 15

but (unin) it’s not considered a valid legal payment 16

plan unless you have one signed agreement. You know, I 17

always work towards the taxpayers, you know, letting 18

them know basically, you know, I’m not going to turn 19

money down but we need to get you on a signed 20

agreement. 21

Q. What’s the advantage to a tax payment (unin)? 22

A. Well it’s, it’s, there are (Unin) advantages. 23

I mean one, they’re, you know basically promising 24



they’re going to pay this back and for our purposes 1

its’ our, you know what we need to have. We have to 2

have a signature, you know basically (unin) we have 3

their written word that they’re what (unin). 4

Q. And what does the Tax Department (unin)? 5

A. that we will not do any further collection 6

actions as long as they’re in compliance with their 7

agreement with us. 8


THE COURT: Okay, Mr. Yates, any questions 10

for Mr. Shaw? 11

MR. YATES: No. 12

THE COURT: Okay, no questions for Mr. Shaw 13

by Mr. Yates. Thank you, Mr. Shaw. 14

MR. SHAW: I can go? 15

THE COURT: Any other, any other redirect for 16

Mr. Shaw? 17

MS. FULTON: No (unin). 18

THE COURT: Go ahead, thank you sir. Nice to 19

meet you. 20

MS. FULTON: The state rest. 21

THE COURT: Okay. So, let’s take… 22

RECORD PAUSED: 23

Okay, we’re back on the record and the, the 24



Respondent, Tax Department has completed its case and 1

chief and there was an issue that came up prior to 2

today’s hearing that Mr. Yates requested subpoenas be 3

issued for Ms. Elmore and Ms. James and I customarily 4

issue subpoenas and then if, unless it’s just so 5

apparent that the subpoena shouldn’t be issued, I’ll go 6

ahead and issue them as a administrative law judge and 7

then rely on the respondent to review that and file the 8

appropriate motion to quash the subpoenas and state 9

your grounds. And, Ms. Fulton has done that. She, I 10

guess the subpoenas were issued. I don’t know if they 11

were served by Mr. Yates but Ms. Fulton filed a motion 12

to quash the subpoenas for Ms. Elmore and Ms. James. I 13

guess I’d really like to explore with Mr. Yates and Ms. 14

Fulton if there’s some alternative way we can get this 15

evidence in and I guess I should start with you, Mr. 16

Yates and if you could just explain to me what the 17

relevance of this particular evidence might be. 18

MR. YATES: (unin) Elmore, she has been a 19

long time supervisor (unin) office. She is well versed 20

in policy at the Department and those are some of the 21

questions I would have for her. I feel that she would 22

be the best (unin) for (unin). 23

THE COURT: What policy are you talking 24



about? The pay, pay plan? 1

MR. YATES: Payment plan, offers and 2

compromise, personnel issues. 3

THE COURT: Would you concede that (unin) at 4

the revocation hearing that took place in April of 5

2011, that led to the written reprimand, is that 6

correct? 7

MR. YATES: That’s correct. 8

THE COURT: Okay. 9

MR. YATES: But she does have knowledge of 10

policy that is in question in that (unin). 11

THE COURT: What about Ms. James? Same 12

relevance? 13

MR. YATES: Yes, Ms. James has actually been 14

a revenue agent in the same area since basically this 15

begun. I’ve been there slightly longer, maybe only a 16

couple of months, less than a year I’m sure, than she 17

has. We’ve had the same interaction, she knows the 18

relationship, she knows, you know all the events. You 19

know, so her testimony in that would be crucial. 20

THE COURT: How crucial. I mean why is it 21

crucial? I mean we’ve had a lot of testimony about 22

policy and certainly you can testify to your 23

understanding. I mean, is there some disagreement you 24



have about whether the payment plan should be singed? 1

You have to explain it to me. 2

MR. YATES: No, no, no. Hers is basically 3

more on the, my claim of the treatment is different 4

than other people. 5

THE COURT: What treatment are you talking 6

about? 7

MR. YATES: The, you know where Mike Coutz 8

had singled me out, talked to me differently, treated 9

me differently. 10

THE COURT: And you, do you have evidence 11

that Mr. Coutz has had similar situations where a 12

revenue agent didn’t appear with his file and give 13

sworn testimony… 14

MR. YATES: Not that specifically. 15

THE COURT: Okay. 16

MR. YATES: We’re talking like inner office 17

(unin) relationships. 18

THE COURT: Okay, Alright, Ms. Fulton, do you 19

want to put anything on the record other than what 20

you’ve already filed in writing? 21

MS. FULTON: I don’t think so. I mean, our 22

view basically is, is with respect to Ms. Elmore is 23

that we’ve had substantial testimony about the policy 24



and I don’t’ think most of it is in dispute. We’re 1

already had the testimony, director, director of the 2

agency… 3

THE COURT: Right. 4

MS. FULTON: (Unin) we don’t feel the nee 5

anymore (unin0. With respect to Ms. James, I don’t 6

think that (unin) pertinent issue, the issues about 7

treatment is really relevant to this. The evidence is 8

that the Grievant didn’t follow the policy, disobeyed 9

the direct order of his supervisor (unin). I really 10

don’t’ see anything else that’s very relevant. 11

THE COURT: Go ahead. 12

MR. YATES: You both have copies to my 13

objections. 14

THE COURT: I have it. 15

MR. YATES: And I stand by whatever, you know 16

I had, I had writ, as to my reasons. That’s, I feel 17

that’s more of a detailed explanation of the objection. 18

THE COURT: Well, I mean the, was Ms. James 19

the revenue agent you referenced, she’s in a North 20

Central, she’s in Clarksburg so she (unin) supervised 21

by Mr. Coutz, is that correct? 22

MR. YATES: She’s been supervised Mr. Coutz, 23

she’s been same supervisor as me, Ms. Silvester, Janet, 24



(unin). She’s worked at the Tax Department before, 1

left and then came back. 2

THE COURT: Well, I would, I would (unin), I 3

would be inclined to deny the motion to quash for Ms. 4

James. We would take, Ms. Fulton can certainly make a 5

relevance objections when we have our next hearing but, 6

I wonder if we couldn’t arrange to take her testimony 7

telephonically. Do you think you could do that Mr. 8

Yates. I’m sure she could… 9

MR. YATES: For Ms. Elmore? 10

THE COURT: Well, no relates to Ms. James. 11

I’m sure she could testify telephonically whenever we 12

get a comeback date. DO you see any problem with that? 13

We do that all the time. Elevate her need to drive 14

from Clarksburg or wherever she lives, to Elkins. 15

MR. YATES: Yes, I would, I would agree to 16

telephonic conferencing. 17

THE COURT: Well… 18

MR. YATES: She’d call in (unin) of being 19

here. 20

THE COURT: Right, she’d just call in. We 21

have some… 22

MR. YATES: It would be a live, it wouldn’t 23

be anything recorded, it would still be live. 24



THE COURT: Absolutely. 1

MR. YATES: (unin). 2

THE COURT: Right. 3

MR. YATES: Okay, I would, I would find that 4

acceptable. 5

THE COURT: I mean, you know I’ll let you 6

make those arrangements and I’ll deny the motion to 7

quash the subpoena. And of course you’ll have to get 8

with, you’ll have to get with Ms. James and get news 9

dates but I don’t, I don’t understand the, the 10

necessity of having, you know, Ms. Elmore testify. 11

Give me a minute. Let me read your… 12

RECORD PAUSED: 13

Okay, we’re back on the record and I’m going 14

to deny the motion to quash the subpoena for, let me 15

make sure I get the name right, for Ms. James. She 16

apparently is a revenue agent too at the North Central 17

Regional Office in Clarksburg and that subpoena has 18

already been issued. And I’m going to, Mr. Yates and 19

Ms. Fulton have agreed to take her testimony 20

telephonically whenever we get a comeback date to have 21

Mr. Yates present his case in chief. But as far as the 22

subpoena request for Ms. Elmore, I’m going to grant the 23

motion to quash that subpoena and Mr. Yates exceptions 24



and objection to that ruling are noted for the record. 1

Mr. Yates, who else would, will we anticipate having 2

testify besides Ms. Ms. James, when we have our next 3

hearing, so we know how much time to set aside? Do 4

you, what other witnesses do we have that we haven’t 5

already? 6

MR. YATES: I have Jamie Grinich, I would 7

have Janet Swinler, and I would like to call back Tim 8

Silvester. 9

THE COURT: Okay. Okay, very well. Sir, you 10

can let Ms. Elmore, have you served your subpoenas yet? 11

MR. YATES: Oh yeah. 12

THE COURT: You’ll probably have to get, 13

you’ll probably have to get a new, a new batch of 14

subpoenas so with that in mind, my ruling is in Ms. 15

Elmore is, if you request that again I’m just not going 16

to execute a subpoena for her, okay? I won’t make the 17

state go back through and file a motion to quash 18

because I’ve ruled on that. So, Ms. Elmore won’t be 19

available as a witness. The other one, the other 20

witness I’m going to, I’ll issue a subpoena with the 21

new, with the new hearing date for Ms. James and you 22

can make arrangements to have her, you know, call in 23

and testify. It’s kind of a, it’s not impossible, it’s 24



not even really complicated but you’re going to have to 1

get the phone number, or we’ll have to get the phone 2

number for the, for the senior center and have to call 3

in here and we’ll make arrangement for her to be 4

patched in, okay? Alright, is there anything else you 5

want to talk about today before we go off the record? 6

MS. FULTON: The only thing I would like to 7

clarify is what we’re going to call this when we 8

introduce it to evidence that never got an exhibit. 9

That was the one where I objected to the Level II 10

documents and instead of removing them we added 11

settlement proposals so we need to indicate (unin) all 12

of that on the record. 13


and the parties have agreed to make the packet that had 15

the payment plan and the settlement, proposed 16

settlement agreement as Joint Exhibit Number 1. 17

(Join Exhibit number 1 marked for 18

identification). 19

It also has the registration certificate 20

revocation policy as well. And we, and the parties 21

have told me they’re going to get to five mutually 22

agreed upon dates and going to submit those and we’ll 23

reconvene, hopefully not too far down the road and 24



we’ll, we’ll hear Mr. Yates case in chief and rebuttal 1

that might be necessary. Is there anything else for 2

the record, Ms. Fulton? 3

MS. FULTON: No, Your Honor. 4

THE COURT: Anything else, Mr. Yates? 5


THE COURT: I noted your exception and 7

objection to my ruling on the motion to quash your 8

subpoena request for Ms. Elmore, okay? That’s 9

preserved for the record. I’ll see you guys later and 10

if there’s nothing else, thank you very much. 11

(HEARING CONCLUDED) 12

yates-transcript2_ 2011 1703-dcr 2012-04-27 hearing

Documents

formal payment

payment agreements

average case

payment plan

level iii

signed payment

west virginia

tax payers