## Facts

- Raphael Leo Reguero, a former sixth-grade teacher, was terminated by his school district in January 1987.
- His Oregon teaching license expired in August 1987, and he applied for reinstatement in October 1987.
- The Teacher Standards and Practices Commission (TSPC) initiated a contested case hearing to decide whether Reguero had “good moral character” and was “fit to serve as a teacher.”
- TSPC did not rely on any criminal conviction; it alleged Reguero engaged in inappropriate sexual conduct with two sixth-grade students, Michelle and Leasa.
- Neither student testified at the hearing; TSPC relied primarily on hearsay and multiple hearsay from adults (including a school counselor, a deputy district attorney, and a police officer) recounting what the children said.
- TSPC denied reinstatement based on findings that Reguero lacked good moral character and fitness to teach; the Court of Appeals affirmed.

## Issues

1. Whether TSPC provided constitutionally adequate notice by applying the statutory term “good moral character” as a basis to deny license reinstatement.
2. Whether TSPC’s findings of sexual misconduct were supported by substantial evidence in the whole record when the proof consisted largely of hearsay and multiple hearsay.

## Decision

- The Oregon Supreme Court held that TSPC’s articulation of “good moral character,” as applied, provided sufficient notice and was not unconstitutionally vague.
- The court rejected a categorical “legal residuum rule” requiring non-hearsay evidence to support administrative findings.
- The court held that, on this record, TSPC’s key findings were not supported by substantial evidence because they depended primarily on unreliable, uncorroborated hearsay and multiple hearsay and the children were unavailable for cross-examination.
- The court reversed the Court of Appeals and remanded to TSPC for further proceedings.

## Legal Principles

- A licensing standard such as “good moral character” may satisfy due process notice requirements when the agency has sufficiently defined and applied the standard to identified categories of disqualifying conduct.
- In Oregon administrative proceedings, hearsay is admissible if it is the type of evidence reasonably prudent persons rely on in serious affairs, and it may support findings if sufficiently reliable and probative.
- Oregon administrative law does not impose a “legal residuum rule” requiring some trial-admissible evidence as a prerequisite to substantial evidence review.
- Whether hearsay constitutes substantial evidence depends on context, including reliability, corroboration, the importance of the fact proved, limits on cross-examination, and the consequences of the agency decision.

## Conclusion

The court upheld TSPC’s use of “good moral character” as an adequate notice standard for teacher licensure but required reversal because the agency’s determinative findings of sexual misconduct rested largely on unreliable hearsay and multiple hearsay and therefore lacked substantial evidence in the whole record.


Reguero v. Teacher Standards & Practices Comm’n, 312 Or. 402, 822 P.2d 1171 (Or. 1991)