Liddell-Toney v. Department of Health & Human Servs.

Darline liDDell-Toney, appellanT, v.
nebraska D eparTmenT of H ealTH anD
Human services eT al ., appellees.
797 N.W.2d 28
Filed May 13, 2011. 	No. S-10-527.
1. Administrative Law: Judgments: Appeal and Error. A judgment or final order
rendered by a district court in a judicial review pursuant to the Administrative
Procedure Act may be reversed, vacated, or modified by an appellate court for
errors appearing on the record. When reviewing an order of a district court under
the Administrative Procedure Act for errors appearing on the record, the inquiry
is whether the decision conforms to the law, is supported by competent evidence,
and is not arbitrary, capricious, or unreasonable.
2. Judgments: Appeal and Error. Whether a decision conforms to law is by defi-
nition a question of law, in connection with which an appellate court reaches a
conclusion independent of that reached by the lower court.
3. Administrative Law: Statutes: Appeal and Error. To the extent that the mean-
ing and interpretation of statutes and regulations are involved, questions of law
are presented, in connection with which an appellate court has an obligation
to reach an independent conclusion irrespective of the decision made by the
court below.
4. Administrative Law: Appeal and Error. An appellate court accords deference
to an agency’s interpretation of its own regulations unless that interpretation is
plainly erroneous or inconsistent.
5. Administrative Law: Statutes: Public Assistance: Medical Assistance: Time.
Pursuant to 468 Neb. Admin. Code, ch. 2, § 020.02(2)(b) (2009), a cash bene-
fit recipient under the Welfare Reform Act, Neb. Rev. Stat. § 68-1708 et seq.
(Reissue 2009), is exempt from Employment First participation if the recipient is
incapacitated with a medically determinable physical impairment which prevents
the individual from entering employment for a period exceeding 3 months.
Appeal from the District Court for Lancaster County: JoHn
a. colborn, Judge. Reversed and remanded with directions.
Scott M. Mertz, of Legal Aid of Nebraska, for appellant.
Jon Bruning, Attorney General, and Michael J. Rumbaugh
for appellees.
H eavican, c.J., G errarD, sTepHan, mccormack, and miller-
lerman, JJ.
G errarD, J.
The Nebraska Department of Health and Human Services
(DHHS) determined that Darline Liddell-Toney was required
532 	281 NEBRASkA REPoRTS
Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
11/01/2026 04:44 AM CST

to participate in a self-sufficiency program in order to receive
cash assistance benefits under the Welfare Reform Act, despite
her documented disability. The district court affirmed the deter-
mination of DHHS, and Liddell-Toney timely appeals. For the
following reasons, we reverse the judgment of the district court
and remand the cause with directions.
BACkGRouND
Liddell-Toney is a 36-year-old single mother who is disabled
by degenerative disk disease. Liddell-Toney receives cash assist-
ance benefits pursuant to the Welfare Reform Act (hereinafter
the Act).1 under the Act, families in which at least one adult
has the capacity to work must participate in the Employment
First self-sufficiency program, pursuant to a “self-sufficiency
contract” which sets forth certain approved work-related activi-
ties in which recipients must engage.2 Liddell-Toney received
cash assistance benefits from the Aid to Dependent Children
program and applied for an exemption from Employment
First because of her medical condition. Pending determination
of whether Liddell-Toney was exempt from participating in
Employment First, DHHS granted Liddell-Toney a temporary
exemption in April 2009.
Before the DHHS state review team, Liddell-Toney presented
a physician’s confidential report as evidence of her inability to
enter the workforce. The report stated that Liddell-Toney suf-
fered from degenerative disk disease, first onset in 2006, and
had a reduced range of motion, a loss of normal curvature of
her spine, and bilateral neuropathy of her lower extremities.
The report also stated that the disease was anticipated to be
of lifetime duration; that the prognosis, including rehabilita-
tion potential, was “[p]oor”; that Liddell-Toney was unable
to walk without a cane and was restricted to limited standing
and walking, and that Liddell-Toney was unable to work due
to the disease. The report also noted that Liddell-Toney was
prescribed numerous medications, which included morphine,
hydrocodone, and oxycodone. Nonetheless, the state review
1 Neb. Rev. Stat. § 68-1708 et seq. (Reissue 2009).
2 See §§ 68-1719 and 68-1723.
LiDDELL-ToNEy v. DEPARTMENT oF HEALTH & HuMAN SERvS. 	533
Cite as 281 Neb. 532

team denied Liddell-Toney’s request for an Employment First
exemption on June 18, 2009, finding that Liddell-Toney was
not incapacitated and could participate in the Employment
First program.
Liddell-Toney then requested a hearing, wherein DHHS
received other evidence of Liddell-Toney’s degenerative disk
disease. This evidence included a supplement to the physi-
cian’s confidential report, in which her treating physician
indicated that in his professional judgment, Liddell-Toney was
currently able to participate in work or job readiness activities
for 0 hours per week. However, he indicated that Liddell-Toney
was able to participate in some job search skills training, such
as resume writing, learning to complete an application, and
interview training. Her physician noted that Liddell-Toney
would require more than 6 months of treatment before she
could complete the work requirements of the Employment
First program. Also received into evidence were radiology
reports from a medical center in omaha, Nebraska, indicating
that Liddell-Toney suffered degenerative disk disease and not-
ing various abnormalities in regard to Liddell-Toney’s spine.
in the margins of the reports are handwritten notes which
read “Mild DDD.” Also received at hearing was a medica-
tion profile for Liddell-Toney for June 2009. The profile lists
Liddell-Toney’s medications as including Cymbalta, diazepam,
Lidoderm, nortriptyline, hydroxyzine, morphine, oxycodone,
and cyclobenzaprine.
After the hearing, DHHS affirmed the state review team’s
denial of the Employment First exemption, noting that though
Liddell-Toney had physical impairments, those impairments
did not prevent her from participating in the Employment First
program. DHHS noted that the Nebraska Administrative Code
provides that an individual is not required to participate in
Employment First component activities if that individual
[i]s incapacitated with a medically determinable physical
or mental impairment which, by itself or in conjunction
with age, prevents the individual from entering employ-
ment or participating in another [Employment First] com-
ponent activity(ies) and which is expected to exist for a
continuous period exceeding three months. The incapacity
534 	281 NEBRASkA REPoRTS

must be evaluated in the context of activities available
through the Employment First program.3
DHHS found that the evidence presented by Liddell-Toney
did not indicate “objective signs or symptoms to support the
allegation that . . . Liddell-Toney is unable to participate in
any component of [Employment First].” DHHS also noted that
though Liddell-Toney’s physician indicated that Liddell-Toney
had severe degenerative disk disease, the radiology reports only
noted “mild degenerative disc disease.” DHHS determined that
Liddell-Toney was not incapacitated for the purposes of an
Employment First exemption under § 020.02(2)(b).
Liddell-Toney petitioned for judicial review. The district
court, citing evidence that Liddell-Toney was participating in
another rehabilitation program at the time she requested an
exemption from the Employment First program, inferred that if
Liddell-Toney was able to participate in one vocational rehabili-
tation program, she was also able to participate in Employment
First. The district court found that Liddell-Toney was not so
limited or incapacitated that she was physically precluded from
engaging in Employment First program activities.
Though the district court recognized that § 020.02(2)(b)
provides an exception to participating in the Employment First
program where an individual is unable to engage in employment
or participate in some Employment First component activities,
the court found that the evidence supported the finding that
Liddell-Toney was able to participate in some Employment
First component activities and that this evidence was a suf-
ficient basis for denying Liddell-Toney an Employment First
exemption. Liddell-Toney appeals.
ASSiGNMENTS oF ERRoR
Liddell-Toney assigns that the district court erred in finding
that (1) DHHS can deny an exemption from participation in
the Employment First program even if the person requesting
the exemption demonstrates that he or she is unable to engage
in employment and (2) DHHS presented sufficient evidence to
3 468 Neb. Admin. Code, ch. 2, § 020.02(2)(b) (2009).
LiDDELL-ToNEy v. DEPARTMENT oF HEALTH & HuMAN SERvS. 	535
Cite as 281 Neb. 532

find that Liddell-Toney is not entitled to an exemption from
participation in the Employment First program.
STANDARD oF REviEW
[1,2] A judgment or final order rendered by a district court in
a judicial review pursuant to the Administrative Procedure Act
may be reversed, vacated, or modified by an appellate court
for errors appearing on the record.4 When reviewing an order
of a district court under the Administrative Procedure Act for
errors appearing on the record, the inquiry is whether the deci-
sion conforms to the law, is supported by competent evidence,
and is not arbitrary, capricious, or unreasonable.5 Whether a
decision conforms to law is by definition a question of law, in
connection with which an appellate court reaches a conclusion
independent of that reached by the lower court.6
[3,4] To the extent that the meaning and interpretation of
statutes and regulations are involved, questions of law are
presented, in connection with which an appellate court has
an obligation to reach an independent conclusion irrespec-
tive of the decision made by the court below.7 An appellate
court accords deference to an agency’s interpretation of its
own regulations unless that interpretation is plainly erroneous
or inconsistent.8
ANALySiS
[5] As noted above, under the Act, families “with at least
one adult with the capacity to work” must participate in an
Employment First self-sufficiency contract “as a condition
of receiving cash assistance.”9 Accordingly, § 020.02(2)(b)
allows an Employment First exemption for a recipient whose
4 Travelers Indem. Co. v. Gridiron Mgmt. Group, ante p. 113, 794 N.W.2d
143 (2011).
5 Id.
6 Id.
7 Davio v. Nebraska Dept. of Health & Human Servs., 280 Neb. 263, 786
N.W.2d 655 (2010).
8 Kosmicki v. State, 264 Neb. 887, 652 N.W.2d 883 (2002).
9 § 68-1723(2).
536 	281 NEBRASkA REPoRTS

impairment “prevents the individual from entering employment
or participating in another [Employment First] component
activity(ies).”10 Liddell-Toney argues that the plain language
of the regulation, consistent with the statutory requirement
of an adult “with the capacity to work,” allows an exception
to Employment First participation if a recipient’s impairment
either prevents the recipient from entering employment or
prevents them from participating in an Employment First com-
ponent activity. We agree with this commonsense reading of
the regulation.
The word “or,” when used properly, is disjunctive.11 if a
recipient’s impairment prevents him or her from entering the
workforce, the first exemption contained in § 020.02(2)(b) is
satisfied and the recipient need not establish that he or she
also cannot participate in Employment First component activi-
ties. Contrary to DHHS’ determination, Liddell-Toney was
not required to establish that she was incapable of participat-
ing in all components of Employment First to be granted an
exemption. instead, presenting uncontroverted evidence that the
impairment prevented her from entering employment sufficed,
as it should, to qualify her for an Employment First exception
under the first condition of § 020.02(2)(b).
The evidence clearly indicates that Liddell-Toney is pre-
vented from entering employment for a substantial period of
time, if at all, due to her disability. Her treating physician deter-
mined that Liddell-Toney’s degenerative disk disease reduced
her range of motion and restricted her to limited standing and
walking, which required the use of a cane. Her treating physi-
cian also noted that the disease would be of lifetime duration,
that the prognosis and rehabilitation potential were poor, and
that Liddell-Toney was able to participate in work or job readi-
ness activities for 0 hours per week. And though the radiology
reports contained handwritten notes of “Mild DDD” in the
margins, even assuming that Liddell-Toney’s degenerative disk
10 See § 020.02(2)(b) (emphasis supplied).
11 Goodyear Tire & Rubber Co. v. State, 275 Neb. 594, 748 N.W.2d 42
(2008).
LiDDELL-ToNEy v. DEPARTMENT oF HEALTH & HuMAN SERvS. 	537
Cite as 281 Neb. 532

disease is “mild,” the record contains no evidence which would
indicate that Liddell-Toney is able to enter the workforce in
the reasonably foreseeable future. in fact, the evidence in the
record which indicates that Liddell-Toney is unable to enter
the workforce is uncontroverted. Liddell-Toney therefore has
met the requirements for an exemption under § 020.02(2)(b),
and the district court erred when it affirmed DHHS’ determina-
tion that Liddell-Toney failed to meet the requirements for an
exemption under DHHS regulations.
The district court noted that Liddell-Toney’s ability to par-
ticipate in some Employment First component activities was a
sufficient basis for denying her an Employment First exemp-
tion. DHHS argues that an individualized Employment First
program contract could be formulated which would be tai-
lored to fit Liddell-Toney’s physical limitations and notes that
Liddell-Toney was engaged in workplace training around the
time she requested an Employment First exemption.
However, because the uncontroverted evidence indicates
that Liddell-Toney’s impairment prevents her from entering
employment, she meets the first exemption under the plain lan-
guage of § 020.02(2)(b), and the question whether she is able
to perform some Employment First activities under the second
exemption contained within § 020.02(2)(b) becomes moot.
Because DHHS’ interpretation of § 020.02(2)(b) is inconsistent
with the plain language of the regulation, we do not accord that
interpretation deference. The uncontroverted evidence in the
record indicates that Liddell-Toney is presently unable to enter
the workforce for a substantial period of time, if at all, and as
such, she is entitled to an Employment First exemption under
§ 020.02(2)(b) as a matter of law.
At oral argument in this appeal, DHHS conceded that if
Liddell-Toney was permanently unable to work, she would be
entitled to an Employment First exemption. And this certainly
makes sense. it would seem absurd to require an individual to
participate in resume writing and interview training activities
if that individual is incapable of entering the workforce at the
conclusion of the training sessions. At argument, DHHS merely
asserted that the evidence was not sufficient to establish the
potential duration of Liddell-Toney’s disability. But the record
538 	281 NEBRASkA REPoRTS

simply does not support DHHS’ argument. Liddell-Toney’s evi-
dence established that her condition was disabling and that her
prognoses for rehabilitation and recovery were poor. There is
no reasonable interpretation of the record under which Liddell-
Toney did not establish that her condition “prevents [her] from
entering employment” and “is expected to exist for a contin-
uous period exceeding three months.”12
CoNCLuSioN
The district court erred when it affirmed DHHS’ determina-
tion that Liddell-Toney did not qualify for an exemption from
participating in the Employment First program. The evidence
clearly indicates that Liddell-Toney’s impairment prevents her
from entering employment for a period exceeding 3 months,
if at all, and she therefore qualifies for an exemption to the
Employment First program under § 020.02(2)(b). The judgment
of the district court is reversed, and the cause remanded with
directions to reverse the determination made by DHHS.
reverseD anD remanDeD wiTH DirecTions.
connolly, J., participating on briefs.
wriGHT, J., not participating.
12 See § 020.02(2)(b).
J.M. v. HoBBS 	539
Cite as 281 Neb. 539
J.m., as G uarDian anD conservaTor for His minor cHilD,
c.m., appellanT, v. billy l. Hobbs , appellee .
797 N.W.2d 227
Filed May 13, 2011. 	No. S-10-600.
1. Statutes: Judgments: Appeal and Error. The meaning of a statute is a question
of law, which an appellate court resolves independently of the trial court.
2. Statutes. Absent a statutory indication to the contrary, words in a statute will be
given their ordinary meaning.
3. ____. Where general and special provisions of statutes are in conflict, the gen-
eral law yields to the special, without regard to priority of dates in enacting
the same.
Appeal from the District Court for Lancaster County: paul
D. merriTT, Jr ., Judge. Affirmed.