School City of Peru v. State Ex Rel. Youngblood , 212 Ind. 255 ( 1937 )

DISSENTING OPINION. I must respectfully dissent from the reasoning and conclusion of the majority of the court. In my judgment the majority is in error in holding: (1) that a school board has the legal power to compel the superintendent of schools to relinquish his position as superintendent with a salary of $3,982.50 and to accept in lieu thereof a position as principal of a grade school at a salary of $1,739.34; and (2) that the jurisdiction of the trial court was limited to a consideration as to whether or not there was sufficient evidence before the board to support the charges against appellee.

Assuming that contract has any legal significance whatever under the Tenure Act I must confess my utter inability to follow the reasoning upon which is based the first holding to which I have referred. In Section 1 of the Tenure Act¹ the following provisions are found:

"Be it enacted by the general assembly of the State of Indiana, That any person who has served or who shall serve under contract as a teacher in any school corporation in the State of Indiana for five or more successive years, and who shall hereafter enter into a teacher's contract for further service with such corporation, shall thereupon become a permanent teacher of such school corporation. The term `teacher' as used in this section shall mean and include licensed public school teachers, supervisors and principals of all public school corporations, and licensed assistant superintendents and superintendents of school cities and towns. Upon the expiration of any contract between such school corporation and a permanent teacher, such contract shall be deemed to continue in effect for an indefinite period and shall be known as an indefinite contract. Such an indefinite contract shall remain in force unless succeeded by a new contract signed by both parties or unless it shall be cancelled as provided in section 2 of this act: . . . and, Provided, further, That teachers' contracts may contain provisions for the fixing of the amount of annual compensation from year to year by a salary schedule adopted by the school corporation and such schedule shall be deemed to be a part of such contract; and, Provided, further That such schedule may be changed by such school corporation on or before May 1st of any year, such changes to become effective at the beginning of the following school year; Provided, That all teachers affected by such changes shall be furnished with printed copies of such changed schedule within thirty days after its adoption."

If the ordinary meaning is to be given to the language used by the General Assembly, we are bound to recognize that the legislative intent was to continue in legal force the last contract formally entered into between a teacher and a school corporation until such contract should be "succeeded by a new contract signed by both parties, or unless it should be cancelled as provided for in section 2 of this act." It would seem to be mentally impossible to conceive of a contract's being continued in force without the essential terms thereof being legally binding upon the parties to the contract. And the only contract which had been executed by the relator and the school corporation, and the one which was the subject of the cancellation proceeding, expressly provided that the relator was employed as superintendent of the public schools of the School City of Peru at a definite salary. It is true, as stated in the majority opinion, that "there is nothing in the act specifying a particular position for any teacher;" but we must assume that the General Assembly enacted the Tenure Act with the knowledge that the contract, which the language of the Act declared would become an indefinite contract and continue in force until superseded or cancelled, would contain the essentials of a contract.

In Fairplay School Township v. O'Neal² it was stated (p. 96) ". . . that a teacher can not recover from the school corporation for the breach of an executory agreement unless it is so full and definite as to be capable of specific enforcement." It is the law in Indiana that no teacher's contract is enforceable unless it is in writing. It is not conceivable under the law of Indiana that a contract could be enforced by one claiming to be the superintendent of the public schools of a school corporation if the contract did not expressly provide that such person was being employed as superintendent of the schools and for a stated, or determinable, salary. And in Atkins v.Van Buren School Township³ it was held that there was no error in sustaining a demurrer to a complaint to recover damages for the breach of a contract when the contract did not designate the number of weeks which would constitute the school term, and when the writing contained no agreement that the blanks should thereafter be filled "in accordance with any defined or definable rule or ascertainable facts." Neither is it conceivable that one who has signed a contract as teacher in the schools of the corporation or as principal of a grade school, at a salary of $1,739.34 would be permitted, in a suit against the school corporation, to establish by parole evidence that he, in fact, had been employed to act as superintendent at a salary of $3,982.50. For, in view of the strictness of the rule in Indiana requiring teacher's contracts to be in writing, a court would be compelled to hold that the essential elements of the contract must be in writing in order to be enforced. So in the instant case the provisions that the relator should act as superintendent of the public schools of the School City of Peru and that his salary should be $3,982.50 were essential elements of his contract and were continued in full force and effect by the provisions of the Tenure Act. The so-called "demotion" was an effort to cancel the contract of the relator as superintendent of the schools of the Peru School Corporation.

The language quoted above from Section 1 of the Tenure Act authorizes the adjustment of salaries "from year to year by a salary schedule." If the salaries of the individual teachers under the indefinite contract can be changed arbitrarily by the school board each year the authorization of the adoption of salary schedules is surplusage. It surely is significant that by the terms of the Act school corporations are required to furnish teachers with printed copies of proposed changes in the salary schedules, and that changes in salary schedules must be made on or before May 1 of any year, and are not effective until the following term of school.

The majority opinion states that "the status of a teacher extends to and includes superintendent as defined by the statute, and he is given the privileges of a teacher." Apparently the foregoing statement is based upon the following language found in Section 1 of the Tenure Act: "The term `teacher' as used in this section shall mean and include licensed public school teachers, supervisors and principals of all public school corporations, and licensed assistant superintendents and superintendents of school cities and towns." The purpose of the foregoing provision is to avoid repetition of the words licensed public school teachers, supervisors and principals and licensed assistant superintendents and superintendents. There is no justification for reading into the provision a legislative intent to destroy the essential elements of the contracts executed by school corporations with supervising and administrative employees. If the foregoing provision had not been used, and if only the term "teacher" had been used, it reasonably could be urged that supervising and administrative employees of the public school system would not be protected by the tenure provision of the Act. Such a contention would be supported by the well known fact, of which courts have judicial knowledge, that both in law and in administrative practice, superintendents, supervisors, principals and teachers constitute distinct classes of public school employees.

The majority opinion makes the following statement: "The appellee claims under his statutory contract. His action is not founded upon any written instrument. He has not pointed to any statute which requires the school board to maintain him in the same position occupied and held at the time he became a tenure teacher." The foregoing language can have no meaning unless the last written contract which was executed between the school corporation of the City of Peru and the relator had ceased to be a contract. But this can not be true in the face of the express provisions of the Tenure Act that "such contract shall be deemed to continue in effect for an indefinite period and shall be known as an indefinite contract." It is a statutory contract only in the sense that by force of the statute it is continued in effect for an indefinite period. It is none the less a written contract of the parties. There was no legislative intent to abolish the necessity of a written contract by the enactment of a Teachers' Tenure Act. In fact the act contains the following provision, Section 6: "This act shall be construed as supplementary to an act of the general assembly, page 195, act 1921, entitled `An act concerning teachers' contracts and providing for the repeal of conflicting laws'." And in the case of Board of School Commissioners of Cityof Indianapolis et al. v. State ex rel. Wolfolk⁴ this court, speaking through Tremain, J. explained in detail that "All of the Acts of 1899, 1921, and 1933 must be construed together as one law, defining the nature and terms of the contract to be executed by the teacher and school corporation. The Acts of 1921 and 1933 took nothing away from the Act of 1899, but added further conditions thereto."

In the case of State ex rel. Black v. Board of SchoolCommissioners,⁵ the following language of Section 1 of the Tenure Act was construed by this court (p. 586):

"Upon the expiration of any contract between such school corporation and a permanent teacher, such contract shall be deemed to continue in effect for an indefinite period and shall be known as an indefinite contract. Such an indefinite contract shall remain in force unless succeeded by a new contract signed by both parties unless it shall be cancelled as provided in section 2 of this act."

In the foregoing case appellee argued that under this provision of the statute, relatrix' indefinite contract was succeeded by a new contract and thereafter she was a permanent teacher with a definite contract. In disposing of this contention this court commented as follows (p. 586):

"It is difficult to follow appellee's argument on this point. If the new contract, herein, was as appellee contends, a definite contract of employment, fixing the beginning and ending of all contractual relation between the parties, then relatrix was not in fact a permanent teacher. Relatrix would be in the anomalous situation of having a permanent tenure with appellee corporation but with no contract defining their respective rights . . . It seems clear that by the above provisions of the statute that when relatrix had taught for appellee corporation for five (or more) successive years and thereafter entered into a teacher's contract for further services she became a permanent teacher of appellee corporation, and that contract became the `indefinite contract,' and remained in full force and effect until succeeded by a new contract or cancelled as provided in § 2 of said act. We do not think that it was the intention of the legislature, by the above provision, to lose to both the state (school corporation) and to the teacher the rights and advantages obtained by them under this statute, by reason of the fact that the proper school officers and the teacher entered into a new contract for the further services of said teacher."

In the case of Arburn v. Hunt et al.⁶ Arburn, a school teacher, brought his action to enjoin proceedings by the board of trustees of a school corporation for the cancellation of his tenure contract. As indicated in the opinion this court believed that the teacher's remedy was the one provided in the Tenure Act, and that he was not entitled to an injunction to restrain the school board from taking action in accordance with the provisions in the statute to cancel the contract of the teacher. The following statements in the opinion leave no doubt that that this court assumed that a permanent teacher continued to serve under a contract which included all the provisions of the Tenure Act (p. 64):

"The source of authority for the so-called permanent teacher's contract is the statute. The legislature need not have provided for such contracts, but, since it did so provide, the entire statute, with all of its provisions, must be read into and considered as a part of the contract. Appellant, by entering into the contract, must be deemed to have agreed that it might be cancelled, as provided in § 2 of the Act, and in the light of his contract he cannot be heard to say that he is entitled to a hearing before any other body or persons than that expressly provided for in the statute."

In my opinion the plain legislative intent and purpose as expressed in the Teachers' Tenure Act, was to continue in force the essential elements of the contract entered into between a school corporation and the other contracting party. The term of the contract which designates the salary is an essential element of the contract and continues in force unless changed by agreement of the parties or through the adoption of a salary schedule, which by the terms of the Tenure Act may be varied in accordance with the procedure set out in the act. Furthermore, I think that the term of the contract between a school corporation and another party which defines the position of the other party as that of superintendent of schools of the corporation is an essential term of the contract, and that a so-called "demotion" from the position of superintendent to that of a ward principal or a regular teaching position would constitute a repudiation of the contract by the school corporation. If a person were serving as a manager of a large department store under a contract calling for $3,982.50 a year it hardly could be contended that the employer could perform his contract by compelling the manager to accept a position as clerk at $1,739.34 a year. Such action would clearly constitute a repudiation of the contract.

The foregoing question has been before the Supreme Court of California under provisions of a Tenure Act which makes the California Court's decision precisely in point in the instant case. In the case of Klein v. Board of Education⁷ the question presented was whether a school board had the power to "demote" a school teacher from the position of vice-principal to a regular teaching position with a consequent reduction in compensation. The following excerpt from the opinion of the Supreme Court of California can not be improved upon as a statement of a rational construction of our own statute (p. 710):

"At the time of the arbitrary demotion of the respondent herein, she had been serving for approximately ten years as vice principal teacher of elementary schools in the city and county of San Francisco. To so arbitrarily reduce her status from that of vice principal to that of teacher, with a consequent reduction in compensation, served to violate and destroy her right of tenure as such vice principal teacher. We cannot accept appellants' conclusion that respondent was not reduced in `grade' because of her retention as a teacher in the elementary schools. In Cullen v. Board of Education, 126 Cal.App. 510, 15 P.2d 227, 16 P.2d 272, wherein we denied a hearing, it is held that `this right of tenure is a right which the teacher enjoys to continue in the position or positions to which he has become elected under the statute — i.e., in a position or positions of a rank and grade equivalent to that occupied for the probationary period and to which the teacher has thus become `elected' under the statute.' (Italics added.) To the same effect see Anderson v. Board of Education, supra, wherein it is declared that `the tenure, therefore, runs to a position of employment, or service, of equal grade and rank to that to which the statutory classification has applied, and such is the settled rule of the Kennedy case."

Mitchell v. Board of Trustees,⁸ decided some time after the foregoing case, required a consideration of the extent of the discretion of a school board to make changes in the position of a tenure teacher. The California District Court of Appeal, Fourth District, decided that the trial court had gone too far in ordering restoration of the petitioner to a particular school and to a particular place in the school district. The California Court's discussion of this point is appropriate to the "demotion" contention in the instant case. I quote as follows (p. 68):

"In Cullen v. Board of Education, 126 Cal.App. 510, 15 P.2d 227, 16 P.2d 272, the court said: `But we should not be understood as holding that this right of tenure guarantees that a teacher must be retained in any particular school or assigned to teach any particular class or classes. This right of tenure is a right which the teacher enjoys to continue in the position or positions to which he has become elected under the statute — i.e., in a position or positions of a rank and grade equivalent to that occupied for the probationary period and to which the teacher has thus become "elected" under the statute.'

"There is nothing in the tenure of law which interferes with the general power and right of a board of education to assign teachers to particular classes and to particular schools in accordance with its judgment and desire reasonably exercised. A teacher, in acquiring a permanent status, does not thereby acquire a vested right to teach any certain class or in any certain school. While a board would have no right to evade the plain meaning of the tenure act by assigning a teacher to a class of work for which he was not qualified, for the purpose of compelling his resignation, it has the power to reasonably change assignments with respect to a permanent teacher so long as the work assigned is of a rank and grade equivalent to that by which the permanent status was acquired and so long as the assignment is one for which the teacher in question is qualified. We think the order here in question should be so modified as to permit the respondent board to assign the petitioner to any class which he was qualified to teach and of a rank and grade similar to the work done by him during his probationary period, whether or not such a class is one in a commercial subject."

The language and the decision of the District Court of Appeal, of California, Fourth District, in the case of Loehr v. Boardof Education⁹ is relied upon in the majority opinion to support the power of the school board in the instant case to "demote" relator. A careful reading of the opinion in that case hardly justifies its use for that purpose. The opinion pointed out that the school law of California recognizes three grades or classes of teachers, namely, primary, grammar and high school grades. The "demotion" involved in the California case was a transfer from "A first grade" in one public school to "B third grade" in another school. Both of these grades were in the statutory grade designated as primary, and the Supreme Court concluded that the board of education had the right, in its discretion, to make the transfer in question.

There may be reasonable differences of opinion as to the soundness of the policy of continuing the last contract of ateacher indefinitely with the consequent restriction upon the discretion of school officials. But the General Assembly enacted, as plainly as our language will permit, that such contract should continue in effect unless and until changed or cancelled in accordance with other provisions of the act. The General Assembly has the power to so provide this method of giving effect to the policy of permanency of positions based upon merit, and the soundness of the general policy, as well as the expediency of the method, is a legislative matter. Since, as stated in the majority opinion, the act does not specify "a particular position for any teacher", I think that school trustees have the power "to reasonably change assignments with respect to a permanent teacher so long as the work assigned is of a rank and grade equivalent to that by which the permanent status was acquired and so long as the assignment is one for which the teacher in question is qualified." (Mitchell v. Board of Trustees, supra.) But to construe the Tenure Act to permit unrestricted changes of positions without reference to the grade or rank of the position occupied during the probationary period, and with respect to which the parties executed the contract which the statute continues as the indefinite contract, seems to the writer to be nothing less than a bald judicial amendment of the statute, impairing, if not defeating, the clear policy and purpose of the Tenure Act.

The second holding of the court, as set out in the opinion, involves implications which affect the question of the jurisdiction of courts to review decisions of administrative bodies in general, as well as those of school boards in particular. The substance of the holding is that if there is any evidence to support the decision of the administrative tribunal, no court has jurisdiction to set aside the holding, even though there is evidence available to show that the hearing was in fact not a fair hearing, and that the decision of the administrative tribunal was made arbitrarily and without reference to the merits of the question before it. By a strange misreading of Indiana cases the opinion cites them as authority for its holding. Most of these cases qualify the statement that action of an administrative board is conclusive by some such statement as: "Unless the board in taking the action acted in bad faith, arbitrarily, corruptly, fraudulently, or in gross abuse of its discretion."¹⁰ In the case of Stiver v. State ex rel.Kent¹¹ this court expressly said that (p. 375) ". . . a court in an action for mandate may set aside such cancellation if it appears that the hearing, in fact, was not a fair hearing, or if there was no evidence to support a finding that a legal cause for cancellation existed." In Stiver et al. v. State ex rel.Kent,¹² it was expressly stated that (p. 389) ". . . It would have been proper for the trial court to consider independent evidence for the purpose of determining whether the hearing was, in fact, a fair hearing." In an opinion supporting our action in overruling a petition for rehearing which was filed April 1, 1937, in the case of Stiver,Trustee v. State ex rel. John J. Kent, No. 26471, reported in 7 N.E.2d 181, it was expressly stated that in our decision in that case it was not intended to overrule "the line of decisions holding that if school authorities in dismissing a teacher acted in bad faith, arbitrarily, fraudulently, or in gross abuse of their discretion, their action is reviewable by the courts." And it was further stated that the trial court was not free to draw the inference that the decisions of the trustee and county superintendent were arbitrary or that the hearing was unfair simply from the fact that most of the evidence before the trustee was the testimony of the trustee and the county superintendent; but it was also clearly expressed in the opinion that the trial court had jurisdiction to hear evidence for the purpose of determining whether the hearing before the trustee, though regular in form, was in truth a fair hearing. The trial court cannot hear evidence merely for the purpose of challenging the weight of the evidence which has been introduced before the township trustee or board of trustees; but I am unable to find any decision in this state which holds, or even intimates, that the trial court does not have jurisdiction to hear evidence for the purpose of determining whether the hearing before a trustee or board of trustees was in fact a fair hearing.

In the instant case the evidence before the trial court was ample to support the finding that the defendants, in cancelling the indefinite contract of relator, "were acting wrongfully, unlawfully, arbitrarily and capriciously without good or valid reasons and for personal reasons." Such action was a fraud upon the law, and in my opinion the trial court, justifiably relying upon the declaration of this court, correctly held that the act of cancellation of relator's contract was void and of no legal effect. It follows that it was the official duty of defendants, resulting from their respective offices, to reinstate relator and the trial court properly entered judgment to that effect.

There is additional reason for affirming the judgment of the trial court. The record shows that a motion in arrest of judgment was made before the motion for a new trial, and that the motion in arrest of judgment was ruled upon before there was a ruling upon the motion for a new trial. Under the authority of Conant v. First National Bank¹³ the right to file a motion for a new trial was waived, and it is clear from the record that there was no error in overruling the motion in arrest of judgment.

In my opinion the judgment of the Circuit Court of Cass County should be affirmed.

¹ Acts, 1927. Ch. 97, p. 259.

² (1890), 127 Ind. 95, 26 N.E. 686.

³ (1881), 77 Ind. 447.

⁴ (1936), 209 Ind. 498, 199 N.E. 569.

⁵ (1932), 205 Ind. 582, 187 N.E. 392.

⁶ (1934), 207 Ind. 61, 191 N.E. 148.

⁷ (1934), 1 Cal.2d 706, 37 P.2d 74.

⁸ (1935), 5 Cal.App.2d 64, 42 P.2d 397.

⁹ (1910), 12 Cal.App. 671, 108 P. 325.

¹⁰ (1932), 203 Ind. 626, 180 N.E. 471.

¹¹ (1937), 211 Ind. Sup. 370, 1 N.E.2d 592.

¹² (1937), 211 Ind. Sup. 380, 1 N.E.2d 1006.

¹³ (1917), 186 Ind. 569, 572, 117 N.E. 607.