Savage Public Schools v. Savage Education Ass'n

No. 81-484
IN THE SUPREME COURT OF THE STATE OF MONTANA

1982

SAVAGE PUBLIC SCHOOLS, RICHLAND CO.
ELEMENTARY DISTRICT #7, and HIGH SCHOOL
DISTRICT #2,
Petitioners and Respondents,
VS.

SAVAGE EDUCATION ASSOCIATION, AFFILIATED
WITH MONTANA EDUCATION ASSOCIATION, and
MONTANA BOARD OF PERSONNEL APPEALS,

Appellants and Respondents.

Appeal from: District Court of the Seventh Judicial District,
In and for the County of Richland
Honorable L. C. Gulbrandson, Judge presiding.
Counsel of Record:
For Appellants:
Hilley & Loring, Great Falls, Montana
Emilie Loring argued, Great Falls, Montana
James Gardner argued, Helena, Montana
For Respondents:
R. W. Heineman argued, Wibaux, Montana
Gene Huntley, Baker, Montana
For Amicus Curiae:

Smith Law Firm, Helena, Montana
Chadwick Smith argued, (Montana School Boards Assoc.)
Helena, Montana

Submitted: May 14, 1952
Decided: July 6, 1982
Filed: JuL 6 - 1982

Clerk
Mr. Chief Justice Frank I. Haswell delivered the Opinion
of the Court.

The Savage Education Association (SEA) and the Board of
Personnel Appeals (the Board) appeal from the decision of
the Richland County District Court reversing the Board's
order. The Board had found that the School District had
committed an unfair labor practice in violation of section
39-31-401(5), MCA, by its refusal to submit a grievance to
arbitration. The Board specifically stated that the School
District enjoyed unfettered discretion in hiring decisions,
but their failure to arbitrate the procedural conditions for
nonrenewal of a nontenured teacher violated the collective
bargaining agreement between the parties. In reversing the
Board's order, the Richland County District Court went far
beyond the narrow ruling of the BPA and held that all matters
relating to hiring and nonrenewal of nontenured teachers
were statutorily and contractually reserved to the sole
discretion of the school district.
On appeal, the SEA and Board contend that the District
Court abused its discretion by deciding issues not ruled
upon by the administrative agency. We find that the District
Court exceeded the proper scope of judicial review and
reverse its judgment, reinstating the Board's final order.
We hold that the refusal of the school district to arbitrate
whether the procedural steps for nonrenewal were followed
was a breach of the collective bargaining agreement and con-
stituted an unfair labor practice. Because the question is
not properly before us, we do not address the other issue
raised by appellants: Whether a school district may agree
to arbitrate the substantive basis of nonrenewal of a nontenured
teacher.
-2-
As the exclusive representative for the teachers, the SEA
entered into a collective bargaining agreement with the
school district. Art. XVII of the agreement provides for a
grievance procedure with final and binding arbitration as
the final step. Art. XIII, 5 2 of the agreement guaranteed
certain procedural rights to nontenured teachers:
"Section 2: Notice of Termination (Nontenure):
Every nontenure teacher being terminated shall
be entitled to the following:
"1. The teacher shall be notified in writing
before the fifteenth (15) day of April.
"2. Within ten (10) days after receipt of such
notice the teacher may request, in writing, a
written statement declaring clearly and explicitly
the specific reason(s), for the termination of
his or her service. The school district will
supply such statement within ten (10) days after
the request.
"3. The teacher may, within ten (10) days after
receipt of the statement of reasons, appeal the
termination through the grievance procedure."
On March 29, 1979, the school district notified two
nontenured teachers that their contracts would not be
renewed for the following year. The teachers filed a timely
grievance alleging violation of certain articles in the
collective bargaining agreement. The matter went through
the initial steps of the grievance procedure without satisfactory
resolution. The SEA demanded arbitration, but the school
board refused, and the matter was submitted to the Board.
The hearing examiner found that the parties had, under
the collective bargaining agreement, agreed to allow a
nontenured teacher to submit the matter or nonrenewal to
arbitration, and had, therefore, refused to bargain in good
faith by refusing to submit the issue of teacher nonrenewal
to arbitration. The school district appealed the hearing
examiners findings and conclusions to the Board.
On appeal, the Board found that the issue for arbitration
was much narrower and concerned only whether the procedure
a g r e e d t o by t h e p a r t i e s w a s p r o p e r l y used i n t e r m i n a t i o n of

t h e teachers. The Board v e r y s p e c i f i c a l l y s t a t e d :

". . . A a r b i t r a t o r , t h e r e f o r e , merely h a s
n
t o d e t e r m i n e whether o r n o t t h e p r o c e d u r e
a g r e e d t o by t h e p a r t i e s was p r o p e r l y used i n
t h e t e r m i n a t i o n o f t h e nontenured t e a c h e r . The
b a s i s of t h e d i s m i s s a l i s n o t a s u b j e c t of review
by t h e a r b i t r a t o r . That i s , i f t h e t e a c h e r w a s
p r o p e r l y e v a l u a t e d and t h e b a s i s f o r t h e d i s m i s s a l
was d i s c u s s e d w i t h t h e t e a c h e r , t h e n t h e t e r m i n a t i o n
w i l l be upheld. The b a s i s of t h e t e r m i n a t i o n c o u l d
be f o r a good r e a s o n o r a bad r e a s o n , s o l o n g as
i t was d i s c u s s e d w i t h t h e t e a c h e r . A s f a r a s t h i s
Board can see, t h e s c h o o l d i s t r i c t h a s r e t a i n e d
unfettered control over t h e reasons f o r dismissal
o f a n o n t e n u r e d t e a c h e r i s j u s t , t h i s Board w i l l
r e s e r v e f o r a d i f f e r e n t h e a r i n g where t h a t i s s u e
i s presented t o i t . "

The D i s t r i c t C o u r t d i d n o t a d d r e s s t h e v e r y narrow

i n t e r p r e t a t i o n of t h e Board. R a t h e r , it a d o p t e d t h e arguments

of t h e s c h o o l d i s t r i c t and h e l d t h a t t h e s c h o o l d i s t r i c t h a s

t h e s o l e d i s c r e t i o n n o t t o renew t h e c o n t r a c t s of t h e two

n o n t e n u r e d t e a c h e r s ; t h a t t h e nonrenewal of t h e i r c o n t r a c t s

was n o t a g r i e v a n c e under t h e c o l l e c t i v e b a r g a i n i n g agreement;

and t h a t t h e s c h o o l d i s t r i c t was w i t h o u t a u t h o r i t y t o b a r g a i n

w i t h t h e SEA r e g a r d i n g matters o f i n h e r e n t m a n a g e r i a l p r e r o g a t i v e s ,

i n c l u d i n g h i r i n g and r e t e n t i o n of employees.

A p p e l l a n t s , SEA and t h e Board, t a k e e x c e p t i o n t o a l l of

t h e D i s t r i c t C o u r t ' s f i n d i n g s and c o n t e n d t h a t t h e D i s t r i c t

C o u r t d i d n o t d e c i d e t h e i s s u e t h a t was b e f o r e it. The SEA

and t h e Board c l a i m t h a t t h e D i s t r i c t C o u r t was l i m i t e d i n

i t s r e v i e w o f t h e B o a r d ' s o r d e r which r e q u i r e d t h a t t h e

o n l y i s s u e t o go t o a r b i t r a t i o n w a s whether t h e t e r m i n a t i o n

p r o c e d u r e s of t h e b a r g a i n i n g agreement w e r e f o l l o w e d .

The D i s t r i c t C o u r t went on t o d e c i d e t h e b r o a d e r i s s u e o f

whether t h e s c h o o l d i s t r i c t h a s t o a r b i t r a t e t h e s u b s t a n t i v e

b a s i s o f n o n t e n u r e d t e a c h e r nonrenewal.

The judgment o f t h e D i s t r i c t C o u r t i s v e r y b r o a d and

d o e s n o t a d d r e s s t h e s p e c i f i c r u l i n g of t h e Board. Judicial
review of the Board is governed by section 39-31-409, MCA,
and section 2-4-701, et seq., of the Montana Administrative
and Procedure Act. A review of the Board's order, in con-
junction with the judgment of the District Court clearly
shows that the District Court exceeded the proper scope of
judicial review. The Board recognized that the issue as to
whether nonrenewal was for just cause was not before it. It
was unnecessary for the District Court to address the issue.
The school district argues that it was the Board who
failed to address the issue stipulated to it by the parties.
The stipulated issue was: "whether the refusal of the
school district to submit the matter of nonrenewal of a
nontenured teacher to binding arbitration is a refusal to
bargain in good faith . . ." The Board clearly considered
this issue and narrowed it to fit the situation.
The procedures outlined in Art. XIII, 5 2 of the Collective
Bargaining Agreement merely grant nontenured teachers the
right to notice and an explanation for their nonrenewal. These
same procedures are already provided for by statute. See
section 20-4-206, MCA. The provision of the collective
bargaining agreement at issue here merely incorporates these
statutory requirements and allows the nontenured teacher
access to the grievance procedure for alleged noncompliance
by the school district. This does not affect any of the

statutorily or contractually reserved management rights of
the school district. Such procedural steps for nonrenewal
are clearly "conditions of employment" and are subject to
collective bargaining. As we stated in Wibaux Ed. Ass'n. v.
Wibaux Cty. High School (1978), 175 Mont. 331, 573 P.2d
1162:
 "It is clear that arbitration [under the collective
bargaining agreement] would be available on a
limited basis if the 'grievance' was that the
school officials or School Board failed to comply
with either the evaluation or hearing procedures
outlined in [the agreement]." 573 P.2d at 1164.
The refusal of the school district to submit this
matter to arbitration violated Art. XIII, S 2 of the Collective
Bargaining Agreement. This was a failure to bargain in good
faith and constitutes an unfair labor practice as defined in
section 39-31-401(5), MCA. See City of ~ivingstonv.
Montana Council No. 9, etc. (1977), 174 Mont. 421, 571 P.2d

By deciding issues not properly before it, the District
Court exceeded the proper scope of judicial review. Accordingly,
we reverse the judgment of the District Court and reinstate
the Board's final order.

Chief Justice
Mr. Justice Daniel J. Shea concurring:
I join in the majority opinion but also add that

perhaps the trial court would not have been so broad in its
rulings, that is, deciding issues not before it, if it had
not adopted word for word the proposed findings and conclu-
sions of the prevailing parties. A casual study of the
respondents' proposed findings and conclusions would have
demonstrated that they exceeded by far the issues which the
trial court was called on to decide.