Boucher v. Division of Employment Security, Department of Labor
169 So.2d 674, 1964 La. App. LEXIS 2147 (1964)
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Rule of Law:
For an act to constitute legal fraud, two elements are essential: an intention to defraud and a resulting loss or damage, or a strong probability thereof. A misrepresentation made without fraudulent intent and which does not result in an unjust advantage or cause a loss is not synonymous with fraud.
Facts:
- In 1950, Marvin E. Thames, the Administrator of the Louisiana Division of Employment Security, directed employees Robert R. Boucher, A. C. Wilkinson, and Jules R. Gueymard to attend out-of-state conventions in California and Nebraska.
- The employees initially declined due to personal cost but agreed after Thames assured them the trips would be at agency expense and that he had secured the necessary approvals.
- After the employees returned, Thames informed them that the federal regional office had retroactively withdrawn its approval for reimbursement for the actual destinations.
- Thames then directed and insisted that the employees submit travel expense reports listing Dallas, Texas—a destination they did not visit for the reported purpose—instead of their actual travel locations to secure reimbursement.
- The employees objected but ultimately complied, fearing negative consequences for their careers if they refused their superior's direct order.
- The expense reports submitted reflected the actual, legitimate costs incurred for the authorized work trips and did not result in any unjust enrichment for the employees or financial loss to the agency beyond what was originally promised.
- The employees' immediate superiors and the agency's comptroller were fully aware of the true circumstances and approved the expense reports based on Thames' authority.
Procedural Posture:
- Robert R. Boucher, A. C. Wilkinson, and Jules R. Gueymard were terminated from their positions at the Louisiana Division of Employment Security by letter dated October 19, 1954, for submitting a 'false and fraudulent claim for travel expenses'.
- The employees (relators) appealed their dismissals to the Louisiana Civil Service Commission.
- The Commission, in a majority decision, affirmed the dismissals, finding they were for a reasonable and legal cause.
- The employees (appellants) appealed the Commission's ruling to the Court of Appeal of Louisiana, First Circuit, where their cases were consolidated.
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Issue:
Does a civil service employee's submission of a travel expense report with an incorrect destination, done at the direction and under pressure from a superior and without intent to gain an unjust personal advantage or cause a loss to the agency, constitute legal fraud sufficient to justify dismissal for cause?
Opinions:
Majority - Ellis, Judge
No. The submission of a travel expense report with a false destination under these circumstances does not constitute legal fraud justifying dismissal. For an act to be legally fraudulent, it must involve both an intention to defraud and a resulting loss or damage. Here, the employees did not act with fraudulent intent to gain an unjust advantage, but rather acted under the coercive direction of their superior. They only sought reimbursement for legitimate, authorized expenses, and the agency suffered no loss beyond what it had originally agreed to pay. Therefore, the essential elements of fraud are absent, and the dismissals were without legal cause.
Analysis:
This decision distinguishes between a 'false' statement and a 'fraudulent' one, establishing that intent and outcome are critical in determining cause for dismissal. It sets a precedent that subordinate employees acting under the coercive direction of a superior, without intent for personal gain, may be shielded from charges of fraud. The ruling emphasizes that courts will look beyond the face of a document to the surrounding circumstances, particularly the power dynamics and the absence of actual harm or unjust enrichment, when evaluating employee misconduct.
