Iupa Local 748 v. Kitsap County ( 2014 )

IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON
INTERNATIONAL UNION OF
POLICE ASSOCIATION, LOCAL 748, No. 71731-6-1 S wo
a/k/a KITSAP COUNTY SHERIFF'S
GO
OFFICE LIEUTENANT'S
ASSOCIATION, I
Appellant, './i n
DIVISION ONE
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no
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KITSAP COUNTY, a Washington PUBLISHED OPINION
Municipality,
Respondent. FILED: September 2. 2014
Spearman, C.J. — This appeal arises from the Kitsap County Superior
Court's order granting attorney fees and costs to Kitsap County Sheriff's Office
Lieutenant's Association (the Union). Kitsap County (the County) contends that
the award was improper because: (1) the statutory provision relied upon, RCW
49.48.030, does not apply to attorney fees and costs incurred during unfair labor
practice proceedings instituted pursuant to chapter 41.56 RCW; (2) the priority of
action doctrine bars the claim for relief sought by the Union; and (3) the County
and Union's collective bargaining agreement contained an express waiver of
recovering attorney fees and costs. We agree with the first contention and
reverse.
No. 71731-6-1/2
FACTS
The County and the Union were parties to a collective bargaining
agreement (CBA) governed by the Public Employees' Collective Bargaining Act,
chapter 41.56 RCW (PECBA). The CBA covered a period from January 1, 2007
through December 31, 2009 and set forth the specific amount that each party
was to contribute to employee health insurance premiums. The PECBA requires
that the status quo be maintained for one year after the lapse of a CBA.
Specifically, it provides:
After the termination date of a collective bargaining agreement, all
of the terms and conditions specified in the collective bargaining
agreement shall remain in effect until the effective date of a
subsequent agreement, not to exceed one year from the
termination date stated in the agreement. Thereafter, the employer
may unilaterally implement according to law.
RCW41.56.123(1).
Before an agreement was reached on a successor agreement to the
2007-2009 CBA, health insurance premiums increased and a dispute arose as to
what constituted the status quo for the payment of employer and employee
contributions toward 2010 health insurance premiums. The County believed the
status quo was the amount it had been paying when the contract expired, with
the employees to cover the full amount of the increase in premiums. The Union
maintained that status quo was the amount employees were paying when the
2007-2009 CBA expired, and the County was prohibited from unilaterally
charging it more.
No. 71731-6-1/3
In December 2009, the Union filed a complaint with the Public
Employment Relations Commission (PERC), alleging that the County committed
an unfair labor practice (ULP), in violation of the PECBA, when it withheld the
amount of the increase in health insurance premiums from employees'
paychecks, unilaterally altering the status quo. In its ULP complaint, the Union
sought an award of attorney fees, costs, and interest.
The PERC hearing examiner recognized that, although the parties had not
contractually agreed to a specific percentage split in premiums, the mutual "caps"
on health insurance premium contributions could not coexist, given the increase
in premiums owed for 2010. Clerk's Papers (CP) at 35. The hearing examiner
determined that the status quo was a split of the increased premiums based on
the relative percentages of the employer and employee contributions each made
in 2009. The hearing examiner concluded that because the County's withholding
of sums in excess of the designated employee contribution rate was a unilateral
change in the status quo, it constituted a ULP. As a remedy, the hearing
examiner ordered partial refunds of the premiums collected from the employees
during bargaining. The hearing examiner did not grant the Union's request for
attorney fees, costs, and interest. The County's appeal of the hearing examiner's
decision to the PERC board was denied.
The Union did not appeal the hearing examiner's decision of its request for
attorney fees and costs. Instead, it filed suit in the Kitsap County Superior Court,
seeking a judgment for the attorney fees and costs incurred in the ULP
proceeding and for attorney fees and costs incurred in the superior court action.
No. 71731-6-1/4
The Union filed a motion for summary judgment, contending that assessment of
fees and costs was mandatory under RCW 49.48.030. The court granted the
Union's motion and entered a judgment for fees and costs. The County filed a
motion for reconsideration, which was denied. The County appeals.
DISCUSSION
We review the entry of summary judgment de novo, engaging in the same
inquiry as the trial court. Summary judgment is proper if there is no genuine issue
of material fact and the moving party is entitled to judgment as a matter of law.
CR 56(c). Likewise, we review questions of law and issues of statutory
interpretation de novo. Cashmere Valley Bank v. State Dep't of Revenue, 175
Wn. App. 403, 408, 305 P.3d 1123 (2013) (citations omitted).
RCW 49.48.030 authorizes an award of attorney fees for employees who
must sue in order to collect wages owed from their employers: "In any action in
which any person is successful in recovering judgment for wages or salary owed
to him or her, reasonable attorney's fees, in an amount to be determined by the
court, shall be assessed against said employer or former employer." RCW
49.48.030 is a remedial statute, which courts construe liberally to effect its
purpose. Int'l Ass'n of Fire Fighters. Local 46 (IAFF) v. Citv of Everett, 146 Wn.2d
29, 34, 42 P.3d 1265 (2002); Cohn v. State. Dep't of Corrections, 78 Wn. App.
63, 66-67, 895 P.2d 857 (1995).
The trial court recognized that the authority to award attorney fees under
the PECBA was limited to extraordinary circumstances when the employer has
engaged in a repetitive pattern of illegal conduct, egregious or willful bad acts,
No. 71731-6-1/5
and/or when an employer has offered frivolous or meritless defenses to a ULP
allegation. See State ex rel. Washington Federation of State Emp.. AFL-CIO v.
Board of Trustees of Central Washington University. 93 Wn.2d 60, 69, 605 P.2d
1252 (1980). The court also determined it was undisputed that no extraordinary
circumstances were present in this case. But relying on IAFF, the court
concluded that the limitations did not apply to an action brought under RCW
49.48.030 because the statute is remedial in nature, jd. Accordingly, it awarded
the Union the attorney fees incurred in PERC proceedings. The Union also relies
on IAFF in urging that we affirm the trial court. We disagree that the case is
controlling.
In IAFF, 146 Wn.2d at 41, our Supreme Court affirmed an award under
RCW 49.48.030 of attorney fees incurred in a grievance arbitration proceeding.
The City of Everett had suspended two members of a local fire fighters' union. \±
at 32. The union brought a grievance proceeding against the City, arguing that
the suspensions violated the union's collective bargaining agreement with the
City. Id As provided for in the CBA, the parties submitted the grievance to
arbitration. Id. The arbitrator ruled that the suspensions violated the CBA,
ordered the City to set aside the suspensions, and awarded back pay. \±
Following the arbitration, the union requested that the City pay the attorney fees
incurred challenging the suspensions, jd. at 33. The City refused and the union
filed suit in superior court, seeking an award of attorney fees under RCW
49.48.030. id. Ruling on cross motions for summary judgment, the trial court
denied the union's motion, granted the City's motion, and dismissed the union's
No. 71731-6-1/6
claim for attorney fees. kL On appeal, we reversed and held that the union was
entitled to attorney fees under the statute. Jd. Our Supreme Court granted
certiorari and affirmed. Id. at 41.
The Supreme Court held that a grievance arbitration for back pay is an
"action" for a "judgment for wages or salary" within the meaning of RCW
49.48.030. Jd. at 34. The Court determined that the plain meaning of the term
"action," as used in the statute, included any judicial proceeding, id. at 40-41. It
explained that arbitration proceedings have often been held to be "judicial" in
nature, at least in part because arbitrators, when acting under the broad authority
granted them by the parties and the statutes, become the judges of both law and
fact. jd. at 37-38. Thus, an arbitration is often a substitute for judicial action in the
courts and, where a party recovers wages in an arbitration proceeding, attorney
fees are available under RCW 49.48.030. jd.
The Union contends there is no meaningful distinction between an
arbitration hearing and ULP proceedings before the PERC because both are
quasi-judicial proceedings. The Union points out that in the ULP proceeding
below the parties presented witnesses, subjected such witnesses to cross
examination, and presented documentary evidence, and that the relief it sought
was the recovery of wages. But the court in IAFF was careful to distinguish
between arbitration proceedings and proceedings before administrative tribunals,
id at 42, n.11. In so doing, it specifically cited Cohn, 78 Wn. App. 65, 67 n.5.
Because Cohn addressed an appeal from a government agency, not
an arbitration proceeding, it is distinguishable. In holding that the
Board and the superior court had no authority to award attorney fees,
No. 71731-6-1/7
Cohn was primarily relying on the statutory authority granted to the
Board in chapter 41.64 RCW and Title 358 WAC. These statutes and
rules apply to proceedings before the Board and not to labor
arbitration proceedings. In fact, the court in Cohn explicitly
acknowledged Division One's extension of RCW 49.48.030 to
arbitration proceedings, while still rejecting it in the context of the
Board.
IAFF, 146 Wn.2d at 42-43 (citations and footnote omitted).
Moreover, there are material distinctions between the arbitration in IAFF
and the administrative proceeding in this case. In deciding the matter before it,
the arbitrator in IAFF had relatively unbridled authority to apply the law and
fashion remedies. The PERC, on the other hand, was strictly limited to the
issues, procedures, and remedies prescribed in its governing statutes and
regulations. The distinction between arbitration and administrative proceedings is
particularly evident when considering an arbitrator's broad authority to award
attorney fees as compared to an administrative agency, which only has such
authority as specifically delegated to it by the legislature, or as otherwise
necessary to fulfill its legislative purpose. And while, as discussed above, PERC
has authority to award attorney fees in certain extraordinary circumstances, it is
undisputed, and the trial court acknowledged, that no such circumstances exist in
this case.
We find Cohn to be dispositive. There, a Department of Corrections (DOC)
employee appealed a disciplinary action against him to the Personnel Appeals
Board. Cohn. 78 Wn. App. at 65. The hearing examiner reversed the disciplinary
action and found the employee was entitled to back pay. \_± The DOC appealed
No. 71731-6-1/8
the decision to the Board, which remanded the case to the examiner, id. On
remand, the employee requested attorney fees pursuant to RCW 49.48.030. id.The examiner affirmed the reversal of the disciplinary action, but denied the
employee's request for attorney fees, concluding that it lacked statutory authority
to award such fees. id. The employee appealed the decision to the superior court
and requested attorney fees incurred in both the administrative proceeding and
the superior court action, id. The trial court affirmed the decision of the Board and
denied the employee's request for attorney fees and costs, Jd
On appeal, we acknowledged the remedial nature of RCW 49.48.030, but
found that "persuasive reasons exist to prohibit the judicial expansion of the
scope of the statute" in the context of proceedings arising from administrative
action. Jd at 67. We held that, because the Board did not have the authority to
award attorney fees to the employee, the superior court similarly lacked authority
to make such an award. Jd at 69-70.
We reached a similar result in Trachtenbero v. Washington State Dep't of
Corrections. 122 Wn. App. 491, 93 P.3d 217 (2004), decided after IAFF.1 That
case involved another DOC disciplinary proceeding and subsequent appeal to
the Personnel Appeals Board. Trachtenberg 122 Wn. App. at 493. As in Cohn.
the Board reversed the DOC's decision to dismiss an employee and reinstated
the employee with back pay. Jd The employee then filed suit in superior courtfor
attorney fees and costs incurred during the administrative appeal, citing RCW
1We note that only the amicus curiae, Washington State Office of the Attorney General,
cited or discussed Cohn or Trachtenberg. The Union has neither attempted to distinguish those
cases from this case nor explicitly argued that either case is no longer good law.
No. 71731-6-1/9
49.48.030. id On cross-motions for summary judgment, the trial court
determined that Cohn controlled and the employee could not recover attorney
fees under the statute. Jd We affirmed, concluding that an administrative
proceeding is not an "action" for a "judgment for wages" within the meaning of
RCW 49.48.030 We also held, as we did in Cohn, that on review of an
administrative order, the trial court had no authority to award attorney fees
incurred in the administrative proceeding where the administrative agency lacked
authority to do so under the governing statutory framework.2 Jd at 496-97.
We conclude it was error for the trial court to award attorney fees incurred
in an ULP proceeding because such a proceeding is not an "action" for a
"judgment for wages" within the meaning of RCW 49.48.030. In addition, even if
the trial court had authority under RCW 49.48.030, it exceeded its authority here
because the extraordinary circumstances necessary for an award of attorney
fees under the PERC's governing statute, RCW 41.56.160, were absent.
Accordingly, the award must be reversed.
Reverse.
WE CONCUR:
VJ^IrrlQw
2 But we acknowledged that, where an employee brings a lawsuit to recover lost wages,
as opposed to initiating administrative proceedings, attorney fees and costs under RCW
49.48.030 are generally available. \± at 497-98.