Jacinto v. Egan

This is an appeal by the Cumberland Teachers’ Association (the association) from a judgment of the Superior Court vacating an arbitration award made pursuant to the terms of a collective bargaining agreement effective during the years 1974-76 (the agreement) between the Cumberland School Committee (the school committee) and the association. The arbitrator had approved a request by a Cumberland teacher for a 1-year leave of absence without pay which had been previously denied by the school committee.

In March 1975, Paula McKeown, a chemistry teacher with 3 years’ experience in the Cumberland school system, applied to the Superintendent of Schools (the superintendent) for a leave of absence without remuneration for the 1975-76 academic year. The leave was sought to pursue a graduate degree in Molecular Biology at the University of Connecticut, a program which requires full-time study and is not offered either part-time or at night. The advanced academic credits were necessary for further certification as a teacher by the State Department of Education when her provisional certification expired at the end of 5 years.

The agreement contains detailed provisions setting forth the conditions under which Cumberland schoolteachers could be granted leaves of absence. Article XX, entitled “Sabbatical Leave,” provides for 1-year leaves with pay for advanced study in an approved college or university program. Leaves under this provision are reserved for teachers with at least 5 years’ teaching experience in the Cumberland system. Article XXI, entitled “Long-Term Leaves of Absence,” provides for leaves due to a teacher-exchange program, the Peace Corps, Vista, military duty, and pregnancy. Article XIX is entitled “Leaves of Absence” and lists seven different categories, including section “E. Temporary Leaves of Absence.” This section authorizes absence for a variety of events, including such occurrences as religious holidays, educational conferences, and participation in any legal proceeding which is related to the teacher’s employment. Section E contains a catch-all provision which reads:

“2. Teachers may be allowed additional time off for other personal reasons when such requests are considered valid by the Superintendent.”

Ms. McKeown sought her leave pursuant to this latter provision.

When the school committee denied the request, the association invoked the grievance procedure set forth in Article XXII of the agreement on behalf of Ms. McKeown. Article XXII was described as the “exclusive remedy” for the resolution of grievances. Binding arbitration, before an arbitrator selected by the American Arbitration Association, was the final process for the disposition of grievances.

After a hearing on the merits in July 1975, the arbitrator made the following award:

“That the grievance is arbitrable.

“That Miss McKeown be granted a year’s leave without remuneration to attend the University of Connecticut for Advanced Studies.

“In addition, the School Committee has no obligation to keep the teacher(s) after the return of Miss McKeown in September, 1976.”

Thereupon, the school committee brought a complaint in the Superior Court for a declaratory judgment to determine the rights of all the parties involved under the agreement and a motion to vacate the award pursuant to G.L. 1956 (1968 Reenactment) §28-9-18. In a decision dated September 23, 1976, the trial justice held that the arbitrator had, in éffect, amended the agreement by granting Ms. McKeown a leave to which she was not entitled. Accordingly, he vacated the award on the ground that the arbitrator exceeded his authority.

The association is now before us on an appeal from the Superior Court judgment, contending that the trial justice exceeded his authority in vacating the arbitrator’s award and in refusing to confirm it.

Before reaching the merits of the controversy, we must first address the issue of mootness. The school committee contends that Ms. McKeown did not return to the Cumberland school system after leaving for a year of study. The school committee, however, has not met its burden of establishing mootness on the record, in view of the conflicting statements in the briefs and at oral argument concerning Ms. McKeown’s whereabouts and the reasons for her failure to return to her former position. There is, therefore, a real justi-ciable controversy before us on which we may make an effective determination. DiPrete v. Vallone, 70 R.I. 286, 289, 38 A.2d 769, 770 (1944).

Judicial authority to review or vacate arbitration awards is statutorily prescribed. Section 28-9-18 authorizes the judiciary to vacate an arbitration award only in three limited instances:

“(a) When the award was procured by fraud.

“(b) Where the arbitrator or arbitrators exceeded their powers, or so imperfectly executed them, that a mutual, final and definite award upon the subject matter submitted was not made.

“(c) If there was no valid submission or contract, and the objection has been raised under the conditions set forth in §28-9-13.”

The trial justice, in vacating the award, ruled that the arbitrator “exceeded his powers.” He relied in particular on a provision of the agreement (Article XXII) which prohibited the arbitrator from making any decision “amending, modifying, adding to or subtracting from the provisions of this agreement.” In his view the arbitrator, in effect, created a “new classification of leave.”

In Belanger v. Matteson, 115 R.I. 332, 355, 346 A.2d 124, 137-38 (1975), cert. denied, 424 U.S. 968, 96 S. Ct. 1466, 47 L. Ed. 2d 736 (1976), we noted that the judicial branch must not overlook the fact that an arbitration award is the decision of an extra-judicial tribunal which the parties themselves have created and by whose judgment they have mutually agreed to abide. The fact that the arbitrator misconstrued the contract or the law is no ground for striking down his award.

“A judicial reversal of an arbitration award based solely on the reviewing court’s disagreement with the arbitrators’ interpretation of the contract would not only nullify the bargain made by the parties but also threaten the strong public policy that favors private settlement of grievance disputes arising from collective bargaining agreements.” Id. at 355-56, 346 A.2d at 138.

The statutory authority to vacate an arbitration award where the arbitrators “exceeded their powers” does not authorize a judicial re-examination of the relevant contractual provision. National Railroad Passenger Corp. v. Chesapeake & Ohio Railway, 551 F.2d 136 (7th Cir. 1977); Amicizia Societa Navegazione v. Chilean Nitrate & Iodine Sales Corp., 274 F.2d 805 (2d Cir.), cert. denied, 363 U.S. 843, 80 S. Ct. 1612, 4 L. Ed. 2d 1727 (1960). The courts are in agreement that an alleged misconstruction of the contract is not a sufficient basis for vacating an arbitration award. National Railroad Passenger Corp. v. Chesapeake & Ohio Railway, 551 F.2d at 142. Indeed, awards premised on “clearly erroneous” interpretations of the contract have been affirmed where the result was rationally based upon the contract. I/S Stavborg v. National Metal Converters, Inc., 500 F.2d 424, 432 (2d Cir. 1974). The proper role for the courts in this regard is to determine whether the arbitrator has resolved the grievance by considering the proper sources — “the contract and those circumstances out of which comes the ‘common law of the shop’ ” — but not to determine whether the arbitrator has resolved the grievance correctly. Gorman, Labor Law 585 (1976), quoting Safeway Stores v. American Bakery & Confectionery Workers International Union, Local 111, 390 F.2d 79, 82 (5th Cir. 1968). As long as the award “draws its essence” from the contract and is based upon a “passably plausible” interpretation of the contract, it is within the arbitrator’s authority and our review must end. United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597, 80 S. Ct. 1358, 1361, 4 L. Ed. 2d 1424, 1428 (1960); Safeway Stores v. American Bakery Confectionery Workers International Union, Local 111, 390 F.2d at 83.

The arbitrator basically relied upon three provisions of the contract in finding that certain provisions of the collective bargaining agreement had been violated when the grievant was denied a 1-year leave of absence without pay. First, Article XIX (Leaves of Absence), section E(2), of the agreement provides that “[tjeachers may be allowed additional time off for other personal reasons when such requests are considered valid by the Superintendent.” Second, the opening paragraph of Article XIX recognizes the right of the school committee to make and enforce reasonable rules to ensure that there is no abuse of leave benefits. The committee agreed to discuss these rules with the teachers’ association prior to their promulgation and agreed that they would be subject to a test in arbitration concerning their reasonableness and their fair and impartial administration in individual cases. Finally, the arbitrator relied upon Article XXV of the agreement, which provides that the regulations and practices in effect relating to conditions of employment shall continue in force, unless the agreement provides for the contrary. The arbitrator found that the committee had not promulgated any rules relating to leaves but had established a pattern and practice of arbitrarily granting leaves (to coach a football team, to run a political campaign, etc.). The arbitrator apparently accepted the association’s argument that the arbitrary granting of leaves without any rules or regulations violated the reasonableness requirement of Article XIX. Accordingly, he granted the grievant a 1-year leave without remuneration.

We believe the decision of the arbitrator “draws its essence” from the contract and is sufficiently “grounded in the contract” to be within the scope of his authority. United Steelworkers of America v. United States Gypsum Co., 492 F.2d 713, 731-32 (5th Or.), cert. denied, 419 U.S. 998, 95 S. Ct. 312, 42 L. Ed. 2d 271 (1974). Absent a manifest disregard of the contractual provisions, or a completely irrational result, the courts have no authority to vacate the arbitrator’s award. Belanger v. Matteson, 115 R.I. at 356, 346 A.2d at 138. The trial justice erred in ruling that the arbitrator exceeded his authority by deciding the precise issue submitted to him. Oinoussian Steamship Corp. v. Sabre Shipping Corp., 224 F. Supp. 807, 809 (S.D. N.Y. 1963).

The trial justice and my Brother Weisberger place particular reliance on the contractual provision which bars the arbitrator from adding to, subtracting from, or “modifying” the terms of the contract. To be sure, at least one case has seized upon this common provision to support or justify the reversal of an arbitrator’s interpretation. Torrington Co. v. Metal Products Workers Union Local 1645, 362 F.2d 677 (2d Cir. 1966). This result has been severely criticized by the commentators and with good cause. By reviewing the arbitrator’s decision on the merits, in order to implement the rather vague restrictions of a “no addition or modification” clause, the courts would appear to be overstepping the limitations imposed upon them by statute. Gorman, Labor Law 589-90 (1976).

“This legerdemain, by which a judicial determination of arbitral error is transformed into an aribitrable amendment of the agreement, is an indefensible inroad into contractual finality.” Dunau, Three Problems in Labor Arbitration, 55 Va. L. Rev. 427, 454 (1969).

Accordingly, the Torrington case has been, for the most part, rejected. Amoco Oil Co. v. Oil Chemical & Atomic Workers International Union Inc., 548 F.2d 1288 (7th Cir.), cert. denied, 431 U.S. 905, 97 S. Ct. 1697, 52 L. Ed. 2d 389 (1977); Holly Sugar Corp. v. Distillery, Rectifying, Wine & Allied Workers International Union, 412 F.2d 899 (9th Cir. 1968); Textile Workers Union of America v. Textile Paper Products, Inc., 405 F.2d 397 (5th Cir. 1968); Dallas Typographical Union, No. 173 v. A.H. Belo Corp., 372 F.2d 577 (5th Cir. 1967); Yakima Newspaper Guild Local No. 27 v. Republic Publishing Co., 375 F. Supp. 945 (E.D. Wash. 1974).

The school committee argues, and the trial justice agreed, that the specificity of Articles XIX, XX, and XXI with respect to conditions under which leaves of absence and sabbaticals could be granted “completely cover the types of leaves upon which the parties had agreed.” Both the committee and the trial justice took the position that since Ms. McKeown did not qualify for any of the specified leaves, the arbitrator, by granting her a year’s unpaid leave, had modified the contract and added a new provision. This argument misses the mark. As noted above, neither the trial justice nor this court has any authority to make such inferences of contractual intent. While we are reluctant to enter into the interpretive areas, we would point out that Article XIX of the agreement, wherein the teachers recognize the school committee’s right to promulgate further rules relating to leaves, disputes any suggestion that the parties intended to cover completely the types of leaves which could be granted. Furthermore, Ms. McKeown did not apply for one of the specifically enumerated leaves, but applied under the catchall provision which allowed teachers additional time off “for other personal reasons when such requests are considered valid by the Superintendent. ”

In short, the parties did not completely cover the occasions under which teachers could be absent from their pedagogical duties. A large measure of discretion was vested in the school committee and the superintendent regarding the granting of leaves of absence. The arbitrator did not “modify” the agreement by granting the requested leave, for there was sufficient evidence before him to indicate that, by arbitrarily granting and denying leaves in the past, without any accompanying rules or regulations, the school committee had breached the reasonableness requirement of the agreement.

Here, Cumberland’s teachers and its school committee had agreed to submit all disputes concerning the interpretation of their contract to binding arbitration. The trial justice, through his reliance on the “no modification” clause, and without statutory authority, has reversed the arbitrator’s interpretation. Judicial reversal of an arbitraitón award based solely upon a disagreement with the arbitrator’s interpretation of the contract nullifies the bargain of the parties and threatens the strong public policy that favors private settlement of grievance disputes arising from collective bargaining agreements. Belanger v. Matteson, 115 R.I. at 355-56, 346 A.2d at 138. If the loser in arbitration has even modest prospects of winning in court, litigation is encouraged and the essence of arbitration — the conclusiveness of the award — is thereby defeated. Dunau, Three Problems in Labor Arbitration, 55 Va. L. Rev. 427, 461-62 (1969); Note, Judicial Review of Arbitration Awards on the Merits, 63 Harv. L. Rev. 681-82 (1950). If the bargain of the parties is to be effectuated and the policy of the Rhode Island Arbitration Act to be adhered to, the following admonition should be our guide:

“The arbiter was chosen to be the Judge. That Judge has spoken. There it ends.” Safeway Stores v. American Bakery & Confectionery Workers International Union, Local 111, 390 F.2d 79, 84 (5th Cir. 1968).

Before concluding, a brief comment should be made about the views expressed by my Brother Weisberger. In his dissent he has detailed a series of cases in which he believes the arbitrator has misconstrued the contract or reached the wrong conclusion. If such a misconception occurred while the arbitrator was attempting to resolve a grievance dispute which arose in the public sector, my Brother would hold that the. erring arbitrator had exceeded his power.

Such a view is totally inconsistent with the unanimous view expressed in other jurisdictions, and it completely nullifies the bargain of the parties. More importantly, nothing in chapter 9 of title 28 suggests or implies that the General Assembly ever intended that there be dual standards of judicial review under §28-9-18, one for the public sector and another for the private sector. If, as my brother contends, the public interest would be served by closer judicial scrutiny of the merits of an arbitration award made in the public sector, this service is to be afforded at the statehouse and not the courthouse.

The association’s appeal is sustained, the judgment appealed from is reversed, and the case is remitted to the Superior Court for the entry of a judgment confirming the award.

The other six categories deal with sick leave, absence due to illness in the family, absence due to deaths and funerals, leaves for military training, jury duty, and personal business days.

A grievance was defined broadly to include any claim by any party to the agreement that there has been a “violation, misinterpretation or inequitable application of the provisions of the agreement.”

E.G., 9 U.S.C. § 10(d)(1970); G.L. 1956 (1968 Reenactment) §28-9-18(b).

This paragraph of Article XIX provides:

“The Association recognizes the right of the Committee to make and enforce reasonable rules to ensure that there is no abuse of leave benefits. The Committee agrees to discuss any such proposed rules with the Association prior to their implementation. It is understood and agreed that the rules promulgated by the Committee are subject to a test in arbitration as to their reasonableness, if challenged by the Association, and as to their fair and impartial administration in individual cases.”

Gorman, Labor Law 589-93 (1976); Dunau, Three Problems in Labor Arbitration, 55 Va. L. Rev. 427, 454 (1969); Feller, A General Theory of the Collective Bargaining Agreement, 61 Cal. L. Rev. 663, 802 n. 538 (1973); Christensen, Labor Arbitration and Judicial Oversight, 19 Stan. L. Rev. 671, 690-93 (1967).

The United States Supreme Court in the Steelworkers trilogy sought to put a halt to the practice of the judiciary’s usurping the arbitrator’s responsibilities under the guise of ruling on the arbitrability of a dispute. United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S. Ct. 1358, 4 L. Ed. 2d 1424 (1960); United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S. Ct. 1347, 4 L. Ed. 2d 1409 (1960); United Steelworkers of America v. American Mfg. Co., 363 U.S. 564, 80 S. Ct. 1343, 4 L. Ed. 2d 1403 (1960). In its trilogy the Court stressed that all doubts as to arbitration were to be resolved in favor of arbitration and observed that courts had no business weighing the merits of a grievance. Parenthetically, it should be noted that the collective bargaining agreement in the American Mfg. case and the Cumberland contract contain the identical boilerplate about the arbitrator’s inability to add to, delete from, or modify. 363 U.S. at 565, 80 S. Ct. at 1345, 4 L. Ed. 2d at 1405.