Roberts v. Lame Deer Public School District 6 , 373 Mont. 49 ( 2013 )

December 3 2013
DA 13-0307
IN THE SUPREME COURT OF THE STATE OF MONTANA
2013 MT 358
SHERRI ROBERTS,
Plaintiff and Appellant,
v.
LAME DEER PUBLIC SCHOOL DISTRICT #6,
Rosebud County,
Defendant and Appellee.
APPEAL FROM: District Court of the Sixteenth Judicial District,
In and For the County of Rosebud, Cause No. DV 2010-64
Honorable George Huss, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Richard O. Harkins; Attorney at Law; Ekalaka, Montana
For Appellee:
Jeff A. Weldon; Felt, Martin, Frazier & Weldon, P.C.;
Billings, Montana
Submitted on Briefs: October 30, 2013
Decided: December 3, 2013
Filed:
__________________________________________
Clerk
Justice Patricia Cotter delivered the Opinion of the Court.
¶1 Sherri Roberts (Roberts) appeals from an order of the Sixteenth Judicial District
Court, Rosebud County, denying her petition to have an arbitration award vacated,
modified, or corrected. We affirm.
ISSUE
¶2 The dispositive issue on appeal is whether the District Court’s refusal to vacate,
modify, or correct the arbitration award was an abuse of discretion.
BACKGROUND
¶3 Beginning in the fall of 2005, Roberts was employed as a vocational agriculture
instructor at the Lame Deer High School. She also served as faculty adviser for the
school’s chapter of the National FFA Organization (formerly known as Future Farmers of
America). She was suspended with pay on August 12, 2009, and her employment was
terminated on November 16, 2009. Roberts appealed her termination to binding
arbitration pursuant to the terms of a collective bargaining agreement between the Lame
Deer Education Association, MEA-MFT, of which Roberts was a member, and Lame
Deer School District No. 6 (School District). The parties selected Arbitrator Michael D.
McDowell (Arbitrator), and he conducted hearings on August 10, 11, and 13, 2010.
¶4 On November 13, 2010, the Arbitrator issued a decision denying Roberts’
grievance. The Arbitrator concluded that the School District had afforded Roberts due
process of law, the School District had good cause to discipline Roberts, and the
discipline of discharge should not be reduced. On December 20, 2010, Roberts filed a
petition to vacate, modify, or correct the arbitration award in the District Court. The
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District Court denied Roberts’ petition and upheld the arbitration award on April 1, 2013.
The District Court concluded that the Arbitrator had not exceeded his powers, and that
Roberts had failed to meet her statutory burden of proving that a ground for vacating,
correcting, or modifying the award existed. The District Court acknowledged Roberts’
argument that a different result could have been reached by the Arbitrator, but declined to
substitute its determination for that of the Arbitrator or to revisit the merits of the
controversy.
¶5 Roberts contends on appeal that the District Court abused its discretion in failing
to vacate or modify the award because the District Court did not carefully evaluate the
facts found by the Arbitrator and failed to “properly scrutinize all prior proceedings by
the sweeping determination that the arbitrators [sic] facts and findings were conclusive.”
Roberts argues that the School District fraudulently misled her, that her actions did not
constitute insubordination, and that the School District did not have good cause to
suspend her. She argues the suspension was based on an improper and illegal motive.
¶6 The School District counters that the District Court properly upheld the award
because Roberts failed to establish any of the limited grounds upon which modification
or correction may be premised under § 27-5-313(1), MCA, and failed to meet her burden
of proving a ground to vacate the award under § 27-5-312(1), MCA.
STANDARD OF REVIEW
¶7 Judicial review of an arbitration award is strictly limited by statute in Montana.
Colstrip Energy L.P. v. N.W. Corp., 2011 MT 99, ¶ 17, 360 Mont. 298, 253 P.3d 870
(internal citations omitted). When a matter has been submitted to binding arbitration,
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courts are not permitted to review the merits of the controversy, but may only confirm,
vacate, modify, or correct an arbitration award pursuant to §§ 27-5-311, -312, and -313,
MCA. Colstrip Energy, ¶ 17 (internal citations omitted). We review a trial court’s
decision to confirm an arbitration award to determine if the court abused its discretion.
The test for an abuse of discretion is whether the trial court acted arbitrarily, without
employment of conscientious judgment, or exceeded the bounds of reason resulting in
substantial injustice. Colstrip Energy, ¶ 18 (internal citations omitted). We can only
review whether the District Court abused its discretion in confirming the arbitration
award; we cannot review the merits of the controversy. Colstrip Energy, ¶ 19 (internal
citations omitted).
DISCUSSION
¶8 Whether the District Court’s refusal to vacate, modify, or correct the arbitration
award was an abuse of discretion.
¶9 The party seeking to vacate, modify, or correct an arbitration award bears the
burden of proving that one of the statutorily enumerated grounds exists. Colstrip Energy,
¶ 17 (internal citations omitted). Therefore, in order to trigger the District Court’s
authority to review the arbitration award, Roberts had to properly raise one of the specific
grounds set forth in §§ 27-5-312 or -313, MCA. While she couches her argument in the
language of § 27-5-312(1)(c) by claiming that “the arbitrator exceeded his powers,” what
she actually asks is that we reweigh the facts and the merits of the controversy.
¶10 Roberts presented the District Court with four grounds for vacating or modifying
the arbitration award: (1) the Arbitrator exceeded his power in not following the
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collective bargaining agreement’s requirement that good cause exist before there may be
a suspension with or without pay; (2) the Arbitrator exceeded his power in allowing the
School District to consider alleged insubordination from before and after Roberts’
termination; (3) the Arbitrator exceeded his power by not differentiating between
Roberts’ teaching contract and her FFA advisor contract; and (4) the Arbitrator exceeded
his power in asserting that Roberts was in control of funds that belonged to the FFA when
she was only an advisor.
¶11 “An arbitrator exceeds his powers when he decides matters which were not
submitted to him.” Terra W. Townhomes, L.L.C. v. Stu Henkel Realty, 2000 MT 43, ¶ 27,
298 Mont. 344, 996 P.2d 866. Here, the parties agreed to the issues that would be
submitted to arbitration, namely whether Roberts was dismissed for good cause, and if
not, what the appropriate remedy was. These were the only matters the Arbitrator
decided; thus, the District Court did not abuse its discretion by refusing to vacate or
modify the award on the basis that the Arbitrator had exceeded his powers.
¶12 Roberts contends that notice and a hearing were required before she could lawfully
be suspended. In Geissler v. Sanem, 285 Mont. 411, 416, 949 P.2d 234, 237-38 (1997),
we adopted the “manifest disregard of the law” standard of review for vacating
arbitration decisions. For reversal under this standard, an arbitrator must have been
aware of a clearly governing principle of Montana law, but “blatantly refused to follow
it.” Paulson v. Flathead Conserv. Dist., 2004 MT 136, ¶ 24, 321 Mont. 364, 91 P.3d 569
(internal citation omitted). The District Court determined Roberts failed to meet the
Geissler standard because she could not demonstrate a clearly governing principle in
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Montana law that suspensions with pay require prior notice and hearing. It naturally
follows that she failed to establish the two following requirements of Geissler, and thus,
the District Court did not abuse its discretion in declining to vacate the award under this
standard.
¶13 As for the factual grounds Roberts raised for modifying or vacating the arbitration
award, the District Court concluded that these had been considered and expressly
addressed by the Arbitrator, and that it was not the role of the court to substitute its
determination for that of the Arbitrator or to revisit the merits of the controversy. As the
District Court noted, modification or correction under § 27-5-313, MCA, was
inappropriate because Roberts “essentially seeks a reversal of the award, which clearly
would go to the merits of the decision rather than to matters of form.” The District Court
did not abuse its discretion in declining to revisit these issues. Requiring the District
Court to conduct its own evidentiary hearing on an issue previously submitted to and
determined in binding arbitration would undermine the finality and expediency provided
by arbitration. See Dick Anderson Constr., Inc. v. Monroe Constr. Co., LLC, 2009 MT
416, ¶ 38, 353 Mont. 534, 221 P.3d 675.
¶14 For the foregoing reasons, we conclude that the District Court did not abuse its
discretion in refusing to modify, correct, or vacate the Arbitrator’s award. We therefore
affirm the decision of the District Court.
/S/ PATRICIA COTTER
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We concur:
/S/ MIKE McGRATH
/S/ BETH BAKER
/S/ LAURIE McKINNON
/S/ JIM RICE
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