Betscher v. Governing Bd. of Putnam Cty. Educational Serv. Ctr.

[Cite as Betscher v. Governing Bd. of Putnam Cty. Educational Serv. Ctr., 2015-Ohio-4727.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
PUTNAM COUNTY
JACKSON BETSCHER,
PLAINTIFF-APPELLANT, CASE NO. 12-15-05
v.
GOVERNING BOARD OF
PUTNAM COUNTY EDUCATIONAL
SERVICE CENTER, OPINION
DEFENDANT-APPELLEE.
Appeal from Putnam County Common Pleas Court
Trial Court No. 14CV184
Judgment Reversed and Cause Remanded
Date of Decision: November 16, 2015
APPEARANCES:
Brian J. DeSantis for Appellant
Elizabeth A. Braverman for Appellee
Case No. 12-15-05
PRESTON, J.
{¶1} Plaintiff-appellant, Jackson Betscher (“Betscher”), appeals the
judgment of the Putnam County Court of Common Pleas dismissing his complaint
against defendant-appellee, the Governing Board of the Putnam County
Educational Service Center (“PCESC”). For the reasons that follow, we reverse.
{¶2} On October 26, 2014, Betscher filed his complaint against the PCESC
alleging that the PCESC failed to provide him “statutorily-mandated paid vacation
leave as required by [R.C.] 3319.084.” (Doc. No. 1). In his complaint, Betscher
alleged that he was “a non-teaching employee under a written continuing contract
pursuant to [R.C.] 3319.081” from April 5, 2011 through December 31, 2013.
(Id.). Attached to his complaint are three employment contracts executed by the
PCESC, the Putnam County Commissioners (“Commissioners”), and Betscher.
The first contract (“contract one”), which was effective from April 5, 2011
through August 14, 2012, states that Betscher would work two days each week for
the Commissioners as a County Administrator and work “[a]ll other times * * *
per the terms of his employment agreement with the [PCESC].” (Id.). The second
contract (“contract two”), which was effective from August 15, 2012 through
August 14, 2013, is similar to contract one, but provided that Betscher would work
two and one half days each week for the Commissioners and work “[a]ll other
times * * * per the terms of his employment agreement with the [PCESC].” (Id.).
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The third contract (“contract three”), which was effective from August 15, 2013
through December 31, 2013, also provided that Betscher would work two and one
half days each week for the Commissioners and work “[a]ll other times * * * per
the terms of his employment agreement with the [PCESC].” (Id.).
{¶3} On February 19, 2015, the PCESC filed a motion to dismiss
Betscher’s complaint under Civ.R. 12(B)(6). (Doc. No. 7). On March 3, 2015,
Betscher filed a memorandum in opposition to the PCESC’s motion to dismiss and
a motion for leave to file an amended complaint. (Doc. No. 8). On March 16,
2015, the PCESC filed a reply memorandum in support of its motion to dismiss.
(Doc. No. 9).
{¶4} On March 20, 2015, Betscher filed a motion for leave to file an
amended complaint instanter, which the trial court granted. (Doc. Nos. 10, 13).
Betscher’s amended complaint was filed on March 25, 2015. (Doc. No. 13). On
April 15, 2015, the PCESC filed a motion to dismiss Betscher’s amended
complaint under Civ.R. 12(B)(6). (Doc. No. 17). On April 29, 2015, Betscher
filed a memorandum in opposition to the PCESC’s motion to dismiss his amended
complaint. (Doc. No. 20). On May 8, 2015, the PCESC filed a reply
memorandum in support of its motion to dismiss Betscher’s amended complaint.
(Doc. No. 21). On May 21, 2015, the trial court granted the PCESC’s motion to
dismiss Betscher’s amended complaint after concluding that Betscher’s
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employment contracts are invalid, and, as such, Betscher, was not a full-time
employee of the PCESC and not entitled to compensation for vacation benefits
under R.C. 3319.084. (Doc. No. 22).
{¶5} On June 10, 2015, Betscher filed his notice of appeal. (Doc. No. 26).
He raises one assignment of error for our review.
Assignment of Error
The Trial Court Erred in Dismissing Plaintiff’s Complaint
Pursuant to Civ. R. 12(B)(6) for Failure to State a Claim Upon
Which Relief Can be Granted.
{¶6} In his assignment of error, Betscher argues that the trial court erred in
granting the PCESC’s Civ.R. 12(B)(6) motion to dismiss. Specifically, while
Betscher argues that the trial court was correct in finding that he was a non-
teaching employee of the PCESC, he argues that the trial court erroneously
concluded that the PCESC lacked legal authority to contract with the
Commissioners prior to the enactment of R.C. 3313.846. Therefore, Betscher
argues that the trial court erred in interpreting his employment contracts to mean
that he was a part-time employee of both the PCESC and the Commissioners.
{¶7} “A [Civ.R. 12(B)(6)] motion to dismiss for failure to state a claim
upon which relief can be granted is procedural and tests whether the complaint is
sufficient.” Bd. of Health of Defiance Cty. v. McCalla, 3d Dist. Defiance No.
4-12-07, 2012-Ohio-4107, ¶ 33, citing State ex rel. Hanson v. Guernsey Cty. Bd.
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Of Commrs., 65 Ohio St.3d 545, 548 (1992). “In order for a trial court to grant a
motion to dismiss for failure to state a claim upon which relief can be granted, it
must appear ‘beyond doubt from the complaint that the plaintiff can prove no set
of facts entitling her to relief.’” McBroom v. Safford, 10th Dist. Franklin No.
11AP-885, 2012-Ohio-1919, ¶ 7, quoting Grey v. Walgreen Co., 8th Dist.
Cuyahoga No. 96846, 2011-Ohio-6167, ¶ 3, citing LeRoy v. Allen, Yurasek &
Merklin, 114 Ohio St.3d 323, 2007-Ohio-3608, ¶ 14. “[A]s long as there is a set
of facts, consistent with the plaintiff’s complaint, which would allow the plaintiff
to recover, the court may not grant a defendant’s motion to dismiss.” York v. Ohio
State Hwy. Patrol, 60 Ohio St.3d 143, 144 (1991).
{¶8} “We review de novo a judgment on a Civ.R. 12(B)(6) motion to
dismiss for failure to state a claim upon which relief can be granted.” McCalla at
¶ 33, citing Perrysburg Twp. v. Rossford, 103 Ohio St.3d 79, 2004-Ohio-4362, ¶ 5.
“Under de novo analysis, we are required to ‘accept all factual allegations of the
complaint as true and draw all reasonable inferences in favor of the nonmoving
party.’” McBroom at ¶ 9, quoting Grey at ¶ 3, citing Byrd v. Faber, 57 Ohio St.3d
56 (1991).
{¶9} “When reviewing a Civ.R. 12(B)(6) motion, courts are confined to the
allegations contained in the complaint.” Cooper v. Highland Cty. Bd. Of
Commrs., 4th Dist. Highland No. 01CA15, 2002-Ohio-2353, ¶ 9, citing State ex
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rel. Alford v. Willoughby Civil Service Comm., 58 Ohio St.2d 221, 223 (1990).
“But courts may consider written instruments if they are attached to the
complaint.” Id., citing First Michigan Bank & Trust v. P. & S. Bldg., 4th Dist.
Meigs No. 413, 1989 WL 11915, *4 (Feb. 16, 1989), citing Slife v. Kundtz
Properties, Inc., 40 Ohio App.2d 179 (8th Dist.1974), paragraph two of the
syllabus. “However, courts should avoid interpreting these written instruments at
the pre-trial stage unless the instrument is clear and unambiguous on its face.” Id.,citing Slife at 184-185. See also Natl. City Mtge. Co. v. Wellman, 174 Ohio
App.3d 622, 2008-Ohio-207, ¶ 21 (4th Dist.) (concluding that, because the parties’
agreement was clear and unambiguous on its face that the parties agreed “to waive
any and all claims, no set of facts would have allowed appellants to maintain a
counterclaim against appellee”). “If the written instrument is unclear or
ambiguous, trial courts are forced to look outside the pleadings in order to
interpret the written instrument.” Cooper at ¶ 9.
{¶10} “If a motion to dismiss refers to, or depends on matters outside the
pleadings, the motion to dismiss must be converted to a motion for summary
judgment under Civ.R. 56(C).” Id., citing Civ.R. 12(B) and State ex rel. The V.
Cos. v. Marshall, 81 Ohio St.3d 467, 470 (1998). “If the court converts the
motion to dismiss to a motion for summary judgment, the parties must be given
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notice and a reasonable opportunity to present all of the available evidence that
Civ.R. 56(C) permits.” Id., citing Marshall at 470.
{¶11} In his complaint, Betscher alleges that he was “a non-teaching
employee under a written continuing contract pursuant to [R.C.] 3319.081,”1 and,
as a non-teaching employee of the PCESC, Betscher alleges that he is entitled to
vacation leave under R.C. 3319.084. (Doc. No. 1). R.C. 3319.084 provides, in
relevant part, “In all school districts each full-time non-teaching school employee
* * *, shall be entitled * * * to vacation leave[.]” (Emphasis added.) In its motion
to dismiss, the PCESC argues that Betscher was not a full-time, non-teaching
employee of the PCESC. Instead, the PCESC argues that Betscher was an “other
administrator” within the meaning of R.C. 3319.02 and not entitled to
vacation-leave benefits.
{¶12} Because the trial court was required to accept as true all of the factual
allegations in Betscher’s amended complaint and draw all reasonable inferences in
his favor when it considered the PCESC’s motion to dismiss, the trial court
assumed without deciding that Betscher was a non-teaching employee of the
PCESC. However, the trial court concluded that Betscher was not entitled to
vacation leave under R.C. 3319.084 because he was not a full-time employee of
the PCESC. In determining whether Betscher was a full-time employee of the
1
R.C. 3319.081 governs contracts for non-teaching “school-district” employees. State ex rel. Tempesta v.
City of Warren, 128 Ohio St.3d 463, 2011-Ohio-1525, ¶ 37.
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PSCEC, the trial court appears to have concluded that Betscher’s employment
contracts are unclear and ambiguous. In particular, the trial court stated, “The
contract does not spell out the exact status of the relationship.” (Doc. No. 22).
Therefore, to determine whether Betscher’s employment contracts made him a
full-time employee of the PCESC and assigned to the commissioners or a part-
time employee of the PCESC and the Commissioners, the trial court applied R.C.
3313.846.2 The trial court interpreted R.C. 3313.846 to bar the PCESC from
contracting with any entity other than a school district prior to September 29,
2011. After making that conclusion, the trial court concluded that there was no set
of facts that would allow Betscher to recover vacation leave under R.C. 3319.084
because the PCESC did not have legal authority to contract with the
Commissioners at the time Betscher’s first contract was executed, and, therefore,
the only way to interpret Betscher’s employment contracts is to conclude that
Betscher was a part-time employee of the PCESC and the Commissioners. (Id.).
{¶13} We conclude that the trial court erred in granting the PCESC’s
motion to dismiss since there is a set of facts, consistent with Betscher’s
complaint, which would allow him to recover—that is, Betscher’s allegation that
he was a full-time, non-teaching employee is a set of facts under which he could
recover. Because the trial court’s decision to grant the PCESC’s motion to dismiss
2
In what appear to be typographical errors in its entry, the trial court noted that it was applying “R.C.
3318.864” and “R.C. 3313.864.” (Doc. No. 22).
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focuses on the interpretation of Betscher’s employment contracts, we will first
review Betscher’s employment contracts.
{¶14} “The principal goal in construing contract language is to effectuate
the intent of the parties.” Beard v. New York Life Ins. & Annuity Corp., 10th Dist.
Franklin No. 12AP-977, 2013-Ohio-3700, ¶ 13, citing In re All Kelley & Ferraro
Asbestos Cases, 104 Ohio St.3d 605, 2004-Ohio-7104, ¶ 29. “‘The intent of the
parties to a contract is presumed to reside in the language they chose to employ in
the agreement.’” Id., quoting Kelly v. Med. Life Ins. Co., 31 Ohio St.3d 130(1987), paragraph one of the syllabus. “A court will resort to extrinsic evidence in
its effort to give effect to the parties’ intentions only where the language is unclear
or ambiguous, or where the circumstances surrounding the agreement invest the
language of the contract with a special meaning.” Kelly at 132. “A contract term
is ambiguous if it is susceptible to more than one reasonable interpretation.” St.
Marys v. Auglaize Cty. Bd. of Commrs., 3d Dist. Auglaize No. 2-05-17, 2006-
Ohio-1773, ¶ 20, citing U.S. Fidelity and Guaranty Co. v. St. Elizabeth Med. Ctr.,
129 Ohio App.3d 45, 55 (2d Dist.1998) and Westfield Ins. Co. v. Galatis, 100
Ohio St.3d 216, 2003-Ohio-5849, ¶ 11-12.
{¶15} Betscher’s employment contracts3 state, in relevant part:
3
Contracts one, two, and three are substantially similar. (See Doc. No. 1). Substantive differences
between the contracts are footnoted.
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This management contract is made and entered * * * by and between
PUTNAM COUNTY EDUCATIONAL SERVICE CENTER and
the BOARD OF PUTNAM COUNTY COMMISSIONERS and Jack
Betscher (hereinafter referred to as “Employee”).
WHEREAS, the PUTNAM COUNTY EDUCATIONAL SERVICE
CENTER currently employs Jack Betscher; and,
WHEREAS, the BOARD OF PUTNAM COUNTY
COMMISSIONERS is desirous of retaining the services of Jack
Betscher as the County Administrator; and
WHEREAS, the PUTNAM COUNTY EDUCATIONAL SERVICE
CENTER and the BOARD OF PUTNAM COUNTY
COMMISSIONERS wish to allow Jack Betscher to maintain
employment with the PUTNAM COUNTY EDUCATIONAL
SERVICE CENTER and contract his services to the BOARD OF
PUTNAM COUNTY COMMISSIONERS;
***
1. SERVICES
Employee shall work and provide services as the County
Administrator for the BOARD OF PUTNAM COUNTY
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COMMISSIONERS two (2)4 days per week (these days may be
utilized to coincide with each entities [sic] need and are not set each
week, but may be moved for scheduling needs). All other times
Employee shall work and provide services per the terms of his
employment agreement with the PUTNAM COUNTY
EDUCATIONAL SERVICE CENTER. * * *
2. COMPENSATION
The PUTNAM COUNTY EDUCATIONAL SERVICE CENTER
shall invoice the BOARD OF PUTNAM COUNTY
COMMISSIONERS for Employees [sic] services to the BOARD OF
PUTNAM COUNTY COMMISSIONERS * * *.
The BOARD OF PUTNAM COUNTY COMMISSIONERS shall be
responsible for all travel and on the job expenses incurred by
Employee arising out of and in the course of his duties as County
Administrator and shall reimburse Employee directly * * *.
4
Contract two provides that Betscher will serve as the County Administrator “two (2 ½) [sic] days per
week” and Contract three provides that Betscher will serve as the County Administrator “two and a half (2
½) days per week.” (Doc. No. 1).
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The BOARD OF PUTNAM COUNTY COMMISSIONERS shall
also pay and/or be responsible for any unemployment expenses * *
*.5
(Emphasis sic.) (Doc. No. 1). Contract three further provides, “At the end of the
term the BOARD OF PUTNAM COUNTY COMMISSIONERS have expressed
interest in the direct employment of Jack Betscher and would like to contract days
back to the PUTNAM COUNTY EDUCATIONAL SERVICE CENTER.”
(Emphasis sic.) (Id.).
{¶16} We agree with the trial court that Betscher’s employment contracts
are unclear and ambiguous regarding his employment status—that is, Betscher’s
employment contracts can reasonably be interpreted to mean that he was a full-
time employee of the PCESC and assigned to the Commissioners or that he
directly contracted as a part-time employee with the PCESC and the
Commissioners.
{¶17} For instance, Betscher’s employment contracts could reasonably be
interpreted to mean that he was a full-time employee of the PCESC and assigned
two to two and one half days per week to the Commissioners because, for
example, the contracts state (1) that Betscher will “work and provide services per
the terms of his employment agreement with the [PCESC]” at “[a]ll other times,”
5
Contract three does not provide that the Commissioners will pay or be responsible for any of Betscher’s
unemployment expenses. (Doc. No. 1).
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(2) that the PCESC was to invoice the Commissioners for the time Betscher
worked for the Commissioners, and (3) that contract three indicates that the
Commissioners “expressed interest in the direct employment of Jack Betscher and
would like to contract days back to the [PCESC].” Yet, Betscher’s employment
contracts could reasonably be interpreted to mean that he was a part-time
employee of the PCESC and the Commissioners because, for example, (1)
Betscher was a party to the contracts, (2) the “whereas provisions” of the contracts
could be interpreted to mean that the PCESC was permitting Betscher to seek
outside employment with and “contract his services to” the Commissioners two to
two and one half days per week, (3) the Commissioners paid Betscher directly for
any travel and on-the-job expenses that he incurred from his duties as County
Administrator, and (4) the Commissioners were responsible, under contracts one
and two, for Betscher’s unemployment expenses.
{¶18} Concluding that a contract is unclear and ambiguous permits a court
to review extrinsic evidence to determine the intent of the parties. Ordinarily,
concluding that a contract is unclear and ambiguous and reviewing extrinsic
evidence to determine the parties’ intent constitutes reversible error at the Civ.R.
12(B)(6) stage, unless the trial court converts the motion to dismiss to a motion for
summary judgement and provides the parties notice and a reasonable opportunity
to present Civ.R. 56(C)-type evidence. However, the trial court neither considered
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extrinsic evidence nor converted the PCESC’s motion to dismiss to a motion for
summary judgment.
{¶19} Rather, the trial court concluded that the interpretation that Betscher
was a full-time employee of the PCESC is barred by statute; therefore, there is
only one reasonable interpretation of his employment contracts—that he was a
part time-employee of the PCESC and the Commissioners and, as a result, there is
no set of facts that would allow Betscher to recover. That is, the trial court
concluded that because the first contract was executed April 5, 2011, more than
five months prior to R.C. 3313.846’s effective date, Betscher could be considered
only a part-time employee of the PCESC and a part-time employee the
Commissioners. We disagree.
{¶20} The trial court’s conclusion that the contracts could only mean that
Betscher was a part-time employee of the PCESC and the Commissioners because
R.C. 3313.846 prohibited the PCESC from contracting with the Commissioners is
erroneous. R.C. 3313.846 provides:
The governing board of an educational service center may enter into
a contract with any political subdivision as defined in section
2744.01 of the Revised Code, not including school districts,
community schools, or STEM schools contracting for services under
section 3313.843, 3313.844, 3313.845, or 3326.45 of the Revised
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Code, under which the educational service center will provide
services to the political subdivision. Services provided under the
contract and the amount to be paid for such services shall be
mutually agreed to by the parties and shall be specified in the
contract. The political subdivision shall directly pay an educational
service center for services specified in the contract. The board of the
educational service center shall file a copy of each contract entered
into under this section with the department of education by the first
day the contract is in effect.
The ability of the PCESC to contract with the Commissioners was not impossible
prior to R.C. 3313.846’s September 29, 2011 enactment. Rather, as we explain
below, at least R.C. 3313.17 authorized the PCESC to contract with the
Commissioners.
{¶21} The concept of an educational service center was established by the
General Assembly in 1995 to replace county school districts. See, e.g., 1999 Ohio
Atty.Gen.Ops. No. 99-023 (“An educational service center is the successor to what
was formally known as a county school district.”), citing Am.Sub.H.B. No. 117,
1995 Ohio Laws File 28; State ex rel. Nese v. State Teachers Retirement Bd. of
Ohio, 136 Ohio St.3d 103, 2013-Ohio-1777, ¶ 4 (“An ‘education service center’ *
* * is a statutory creation.”). See also 2014 Ohio Atty.Gen.Ops. No. 2014-012
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(“An educational service center is administered by a governing board, the
successor to a county board of education.”), citing R.C. 3313.01, R.C. 3313.055,
and 2010 Ohio Atty.Gen.Ops. No. 2010-028. An “educational service center” is
considered a school district, school board, or board of education, whenever in R.C.
Title 33 the terms “school district,” “school board,” or “board of education” are
used “‘without expressly referring to boards governing city, local, exempted
village, or joint vocational school districts, or some specific combination
thereof.’” 2014 Ohio Atty.Gen.Ops. No. 2014-012, quoting R.C. 3311.055.
“Therefore, ‘the governing board of an educational service center has many of the
same powers and duties as the board of education of a school district.’” Id.,quoting 2005 Ohio Atty.Gen.Ops. No. 2005-033. In describing those powers and
duties, the Ohio Attorney General noted that educational service centers have
“general powers to contract.” 1999 Ohio Atty.Gen.Ops. No. 99-023, citing R.C.
3313.17 and 3313.36-3313.371.
{¶22} Specifically, R.C. 3313.17 provides:
The board of education of each school district shall be a body politic
and corporate, and, as such, capable of suing and being sued,
contracting and being contracted with, acquiring, holding,
possessing, and disposing of real and personal property, and taking
and holding in trust for the use and benefit of such district, any grant
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or devise of land and any donation or bequest of money or other
personal property.
(Emphasis added.) Thus, because R.C. 3313.17 does not expressly refer to
“boards governing city, local, exempted village, or joint vocational school
districts, or some specific combination thereof” in describing a “board of
education,” R.C. 3313.17 indicates that educational service centers may contract
and be contracted with.
{¶23} In discussing the powers of Ohio boards of education, the Supreme
Court of Ohio stated, “Ohio boards of education are creations of statute, and their
authority is derived from and strictly limited to powers that are expressly granted
by statute or clearly implied therefrom.” Cincinnati City School Dist. Bd. of Edn.
v. Conners, 132 Ohio St.3d 468, 2012-Ohio-2447, ¶ 9, citing Schwing v. McClure,
120 Ohio St. 335 (1929), syllabus. Similarly, the Supreme Court noted, “In
enacting R.C. 3313.17, the General Assembly gave boards of education the
discretionary authority to contract with other parties in order to administer Ohio’s
system of education.” Id. at ¶ 10. These principles also apply to educational
service centers. Cincinnati City School Dist. Bd. of Edn. v. State Bd. of Edn., 122
Ohio St.3d 557, 2009-Ohio-3628, ¶ 17 (“A school district board of education is a
statutorily created entity composed of individual members responsible for
governing a school district or educational service center. It is described as ‘a
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body politic and corporate.’”), citing R.C. 3311.055 and 3313.17. Indeed, in
discussing the General Assembly’s intent in enacting R.C. 3313.17, the Supreme
Court concluded that the General Assembly authorized boards of education,
which, as we stated above, are responsible for governing a school district or
educational service center, the discretionary authority to contract with other
parties—that is, an educational service center’s discretionary authority to contract
with other parties is not limited to only contracting with other school districts.
{¶24} Therefore, the trial court erred in dismissing Betscher’s amended
complaint for failing to state a claim upon which relief can be granted.
Specifically, the trial court erred in applying R.C. 3313.846. The PCESC was
authorized by at least R.C. 3313.17 to contract with the Commissioners. Thus, the
trial court erred by relying on R.C. 3313.846 to conclude that Betscher was a part-
time employee of the PCESC. Accordingly, a determination whether Betscher
was a full-time employee of the PCESC and assigned to the Commissioners or a
part-time employee of the PCESC and the Commissioners is necessary. However,
the answer to that question depends on the interpretation of Betscher’s unclear and
ambiguous employment contracts, which exceeds the scope authorized by Civ.R.
12(B)(6) and necessarily involves factual issues outside Betscher’s amended
complaint that may be addressed at trial or, if appropriate, at the
summary-judgment stage. Moreover, not only does Betscher’s full-time or part-
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time employment status need to be ascertained, but also necessary is a
determination whether he was a “non-teaching employee” under R.C. 3319.081,
an “other administrator” under R.C. 3319.02, or some other type of employee.
{¶25} Betscher’s assignment of error is sustained.
{¶26} Having found error prejudicial to the appellant herein in the
particulars assigned and argued, we reverse the judgment of the trial court and
remand for further proceedings consistent with this opinion.
Judgment Reversed and
Cause Remanded
ROGERS, P.J. and SHAW, J., concur.
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