Thomas v. City of North Las Vegas

• Citation: 127 P.3d 1057
• Decision Date: 09 February 2006
• Docket Number: No. 39639.,No. 42641.,No. 42148.,39639.,42148.,42641.
• Parties: Michael THOMAS and John Armstrong, Appellants, v. THE CITY OF NORTH LAS VEGAS and The North Las Vegas Police Officers Association, Inc., Respondents. City of North Las Vegas, Appellant, v. Michael Thomas, Respondent. City of North Las Vegas, Appellant, v. John Armstrong, Respondent.
• Court: Supreme Court of Nevada

127 P.3d 1057

Michael THOMAS and John Armstrong, Appellants, v. THE CITY OF NORTH LAS VEGAS and The North Las Vegas Police Officers Association, Inc., Respondents.

City of North Las Vegas, Appellant, v. Michael Thomas, Respondent.

City of North Las Vegas, Appellant, v. John Armstrong, Respondent.

No. 39639.

No. 42148.

No. 42641.

Supreme Court of Nevada.

February 9, 2006.

COPYRIGHT MATERIAL OMITTED

Muije & Varricchio and John W. Muije and Philip T. Varricchio, Las Vegas, for Appellants and Respondents Michael Thomas and John Armstrong.

Carie A. Torrence, Acting City Attorney, North Las Vegas, for Respondent City of North Las Vegas.

Kamer Zucker & Abbott and Jody M. Florence and Gregory J. Kamer, Las Vegas, for Appellant City of North Las Vegas.

John R. Hawley, Henderson; George R. Fleischli, Madison, Wisconsin; Calvin William Sharpe, Cleveland, Ohio, for Amicus Curiae National Academy of Arbitrators.

Before the Court En Banc.

OPINION

ROSE, C.J.

Michael Thomas and John Armstrong were formerly employed with the North Las Vegas Police Department (NLVPD). Thomas and Armstrong were terminated from their positions as police officers. Under their union's collective bargaining agreement, they were entitled to arbitrate their grievances regarding their terminations with the City of North Las Vegas. However, the City and NLVPD's union, the North Las Vegas Police Officers Association, Inc. (NLVPOA), denied Thomas and Armstrong arbitration. Thomas and Armstrong sued both the City and the NLVPOA, and the district court compelled arbitration. Thomas and Armstrong then filed a motion for attorney fees and costs, arguing that they were entitled to attorney fees under the substantial benefit doctrine, NRS 18.010(2)(a) (recovery under $20,000), and NRS 18.010(2)(b) (groundless defenses).¹ The district court denied their motion in its entirety, and Thomas and Armstrong appeal that determination in Docket No. 39639.

Thomas and Armstrong then arbitrated their grievances with the City. In each arbitration, the arbitrator found that the City had grounds for discharge and upheld the terminations. Thomas and Armstrong each filed a motion to vacate the arbitration award under NRS 38.145² and manifest disregard of the law. The City filed motions to confirm the arbitration awards. The district courts found in favor of Thomas and Armstrong and vacated both arbitration awards. The City appeals these decisions in Docket Nos. 42148 and 42641.

We conclude that Thomas and Armstrong's argument regarding attorney fees is without merit. First, to qualify for the substantial benefit exception to the American rule that parties generally must bear their own attorney fees, the prevailing party must show that the losing party has received a benefit from the litigation. Thomas and Armstrong have not shown that the City received a benefit from their litigation. Second, under NRS 18.010(2)(a), it is well settled that a money judgment is a prerequisite to recovery of attorney fees, and Thomas and Armstrong have not presented a compelling argument to support their request that we abrogate that requirement. We also conclude that their argument under NRS 18.010(2)(b) is without merit. Accordingly, we affirm the decision of the district court. Additionally, we impose sanctions in the amount of $1000 on attorney John Benedict of Ashworth & Benedict for improper and egregious appellate conduct.³

We further conclude that the City is correct that the arbitration awards should not have been vacated. Thomas's and Armstrong's challenges to the arbitration awards under NRS 38.145 and manifest disregard of the law are without merit. Thus, we reverse the decisions of the district courts vacating the arbitration awards and remand to the district courts to confirm the arbitration awards.

FACTS

This dispute centers around the employment termination of two NLVPD officers, Michael Thomas and John Armstrong. Thomas began employment with the NLVPD in 1993. In August 1999, following an Internal Affairs investigation and a pretermination hearing, Thomas was terminated from the NLVPD for associating with known offenders, unprofessional conduct, noncompliance with orders, public statements, and media releases. The City informed Thomas that he had acted in "an untruthful, disruptive and insubordinate manner, and ha[d] further brought [his] department and the City into disrepute by [his] unprofessional conduct."

Armstrong began employment with the NLVPD in 1991. In May 1999, following a predisciplinary hearing, Armstrong was terminated from the NLVPD for alleged sexual harassment. The City met with Armstrong and his accusers in separate meetings and concluded that Armstrong's conduct in the workplace toward his coworkers was "inappropriate, demeaning, intimidating and abusive to such an extent that it would be unreasonable to return him to the workplace."⁴

Throughout Thomas's and Armstrong's employment with the NLVPD, their union, the NLVPOA, was the exclusive bargaining representative for commissioned officers at the NLVPD. The City and the NLVPOA negotiated a collective bargaining agreement, which governed the terms and conditions of employment for all commissioned officers. Both Thomas and Armstrong were civil service employees in a classified or tenured position and, as such, under the collective bargaining agreement could not be terminated other than for cause.

The collective bargaining agreement contained a grievance and arbitration procedure, which was the exclusive remedy for any dispute regarding the terms of the collective bargaining agreement. Under the grievance and arbitration procedure, the NLVPOA's grievance committee was responsible for reviewing all employee grievances. If the grievance committee determined that a grievance existed, the NLVPOA would submit the grievance to the City.

Under the 1995-98 collective bargaining agreement (CBA), if the City and the NLVPOA were unable to reach an agreement concerning the grievance, the employee had the right to submit the matter to arbitration. Further, under the NLVPOA's 1995 Constitution and Bylaws, union members were permitted to employ a legal representative of their choice and at their own expense to process a grievance under the 1995-98 CBA.

The 1995-98 CBA was replaced by the 1998-01 CBA. Notably, the grievance and arbitration clause had been amended to provide that if a settlement could not be reached between the City Manager and the NLVPOA, the NLVPOA had the right to submit the matter to arbitration. Thus, the CBA no longer permitted an employee to submit a grievance to arbitration. The NLVPOA's Constitution and Bylaws were also amended in 1998 but still contained the same provision as the 1995 Constitution and Bylaws allowing a union member to employ a legal representative of their choice and expense to process a grievance action in accordance with the CBA.

Following his termination, Thomas retained counsel at his own expense and sent a letter to the NLVPOA, the NLVPD, and the City appealing his termination and requesting arbitration and NLVPOA representation. The NLVPOA denied his request for representation, stating that the NLVPOA's Constitution and Bylaws prohibited representation. Thomas once more asked the City and the NLVPOA for arbitration and representation and was again denied.

After Armstrong was terminated, he also retained his own counsel without aid of the NLVPOA and notified the City of his intended grievance. The City informed Armstrong that he must comply with the provisions of the CBA's grievance and arbitration procedure. Thus, Armstrong had to first submit his grievance to the NLVPOA grievance committee and not to the City. Armstrong submitted his grievance to the NLVPOA and requested that the NLVPOA participate in arbitration with the City. The NLVPOA denied Armstrong's request for representation, stating that the NLVPOA's Constitution prohibited it from representing him.

Both Thomas and Armstrong unsuccessfully appealed to the North Las Vegas Civil Service Board and then filed petitions to compel arbitration in the district court. Thomas's and Armstrong's petitions to compel arbitration were consolidated, and the district court granted their petitions.

Thomas and Armstrong's motion for attorney fees

After the district court compelled arbitration, the NLVPOA issued a position statement in which it said that it had reexamined the arbitration situation, specifically as it related to Thomas and Armstrong. The NLVPOA said that it believed that its initial position was erroneous and its new position was that Thomas and Armstrong were entitled to arbitrate their grievances. It also stated that, had it taken that position from the inception of their grievances and requests for arbitration, the arbitration "would have occurred as a matter of course" and the "entire litigation would have been avoided. Under the terms of the CBA, the City would not have [had] any option but to arbitrate their terminations if arbitration had been requested by the [NLVPOA]."

Thomas and Armstrong then moved for attorney fees, arguing that they were entitled to attorney fees under the substantial benefit exception to the American rule, NRS 18.010(2)(a) (recovery under $20,000), and NRS 18.010(2)(b) (groundless defenses). The district court denied their motion, and Thomas and Armstrong appealed that order to this court.

The arbitrations

Under the CBA, arbitrations were to be conducted by the Federal Mediation and Conciliation Services (FMCS). As such, the arbitrations would be governed by FMCS rules, and the City and the NLVPOA were to select a mutually-agreed-upon arbitrator from a panel provided by the FMCS. The parties mutually selected Matthew Goldberg for Armstrong's arbitration. However, the parties disagreed on an arbitrator for Thomas's arbitration, and eventually the district court ordered the parties to use Goldberg for Thomas's arbitration as well.

In November 2001, Goldberg had a...