Donald v. City of West Branch, Michigan

• Decision Date: 18 April 1984
• Docket Number: No. 83-219,83-219
• Citation: 80 L.Ed.2d 302,466 U.S. 284,104 S.Ct. 1799
• Parties: Gary McDONALD, Petitioner, v. CITY OF WEST BRANCH, MICHIGAN, et al
• Court: U.S. Supreme Court

466 U.S. 284

104 S.Ct. 1799

80 L.Ed.2d 302

Gary McDONALD, Petitioner,

v CITY OF WEST BRANCH, MICHIGAN, et al.

No. 83-219.

Supreme Court of the United States

Argued Feb. 27, 1984.

Decided April 18, 1984.

Syllabus

When petitioner was discharged from respondent city's police force, he filed a grievance pursuant to the collective-bargaining agreement between the city and a labor union, contending that there was "no proper cause" for his discharge. The grievance was ultimately taken to arbitration, and the arbitrator ruled against petitioner, finding that there was just cause for his discharge. Petitioner did not appeal this decision, but filed an action in Federal District Court under 42 U.S.C. § 1983 against the city and certain of its officials, including the Chief of Police, alleging that he was discharged for exercising his First Amendment rights of freedom of speech, freedom of association, and freedom to petition the government for redress of grievances. The jury returned a verdict against the Chief of Police but in favor of the other defendants. The Court of Appeals reversed the judgment against the Chief of Police, holding that petitioner's First Amendment claims were barred by res judicata and collateral estoppel.

Held: In a § 1983 action, a federal court should not afford res judicata or collateral estoppel effect to an award in an arbitration proceeding brought pursuant to the terms of a collective-bargaining agreement, and hence petitioner's § 1983 action was not barred by the arbitration award. Pp. 287-292.

(a) Title 28 U.S.C. § 1738—which provides that the "judicial proceedings" of any court of any State shall have the same full faith and credit in every court within the United States as they have by law or usage in the courts of such State from which they are taken—does not require that preclusive effect be given to the arbitration award in question. Arbitration is not a "judicial proceeding" and, therefore, § 1738 does not apply to arbitration awards. Pp. 287-288.

(b) Although arbitration is well suited to resolving contractual disputes, it cannot provide an adequate substitute for a judicial proceeding in protecting the federal statutory and constitutional rights that § 1983 is designed to safeguard. As a result, according preclusive effect to an arbitration award in a subsequent § 1983 action would undermine that statute's efficacy in protecting federal rights. This conclusion is supported by the facts that an arbitrator may not have the expertise to resolve the complex legal questions that arise in § 1983 actions or the authority to enforce § 1983; that a union's usual exclusive control over grievance procedures may result in an employee's loss of an opportunity to be compensated for a constitutional deprivation merely because it was not in the union's interest to press his grievance vigorously; and that arbitral factfinding is generally not equivalent to judicial factfinding. Pp. 288-292.

709 F.2d 1505 (6th Cir.1983), reversed and remanded.

David J. Achtenberg, Kansas City, Mo., for petitioner.

Richard G. Smith, Bay City, Mich., for respondents.

Justice BRENNAN delivered the opinion of the Court.

The question presented in this § 1983 action is whether a federal court may accord preclusive effect to an unappealed arbitration award in a case brought under that statute.¹ In an unpublished opinion, the Court of Appeals for the Sixth Circuit held that such awards have preclusive effect. We granted certiorari, 464 U.S. 813, 104 S.Ct. 66, 78 L.Ed.2d 81 (1983), and now reverse.

I

On November 26, 1976, petitioner Gary McDonald, then a West Branch, Mich., police officer, was discharged. McDon- ald filed a grievance pursuant to the collective-bargaining agreement then in force between West Branch and the United Steelworkers of America (the Union), contending that there was "no proper cause" for his discharge, and that, as a result, the discharge violated the collective-bargaining agreement.² After the preliminary steps in the contractual grievance procedure had been exhausted, the grievance was taken to arbitration. The arbitrator ruled against McDonald, however, finding that there was just cause for his discharge.

McDonald did not appeal the arbitrator's decision. Subsequently, however, he filed this § 1983 action against the city of West Branch and certain of its officials, including its Chief of Police, Paul Longstreet.³ In his complaint, McDonald alleged that he was discharged for exercising his First Amendment rights of freedom of speech, freedom of association, and freedom to petition the government for redress of grievances.⁴ The case was tried to a jury which returned a verdict against Longstreet, but in favor of the remaining defendants.

On appeal, the Court of Appeals for the Sixth Circuit reversed the judgment against Longstreet. 709 F.2d 1505 (1983). The court reasoned that the parties had agreed to settle their disputes through the arbitration process and that the arbitrator had considered the reasons for McDonald's discharge. Finding that the arbitration process had not been abused, the Court of Appeals concluded that McDonald's First Amendment claims were barred by res judicata and collateral estoppel.⁵

II

A.

At the outset, we must consider whether federal courts are obligated by statute to accord res judicata or collateral-estoppel effect to the arbitrator's decision. Respondents contend that the Federal Full Faith and Credit Statute, 28 U.S.C. § 1738, requires that we give preclusive effect to the arbitration award.

Our cases establish that § 1738 obliges federal courts to give the same preclusive effect to a state-court judgment as would the courts of the State rendering the judgment. See, e.g., Migra v. Warren City School District Board of Education, 465 U.S. 75, 81, 104 S.Ct. 892, 896, 79 L.Ed.2d 56 (1984); Kremer v. Chemical Construction Corp., 456 U.S. 461, 466, 102 S.Ct. 1883, 1889, 72 L.Ed.2d 262 (1982). As we explained in Kremer, however, "[a] rbitration decisions . . . are not subject to the mandate of § 1738." Id., at 477, 102 S.Ct., at 1894. This conclusion follows from the plain language of § 1738 which provides in pertinent part that the "judicial proceedings [of any court of any State] shall have the same full faith and credit in every court within the United States and its Territories and Possessions as they have by law or usage in the courts of such State . . . from which they are taken." (Emphasis added.) ⁶ Arbitration is not a "judicial proceeding" and, therefore, § 1738 does not apply to arbitration awards.⁷

B

Because federal courts are not required by statute to give res judicata or collateral-estoppel effect to an unappealed arbitration award, any rule of preclusion would necessarily be judicially fashioned. We therefore consider the question whether it was appropriate for the Court of Appeals to fashion such a rule.

On two previous occasions this Court has considered the contention that an award in an arbitration proceeding brought pursuant to a collective-bargaining agreement should preclude a subsequent suit in federal court. In both instances we rejected the claim.

Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974), was an action under Title VII of the Civil Rights Act of 1964 brought by an employee who had unsuccessfully claimed in an arbitration proceeding that his discharge was racially motivated. Although Alexander protested the same discharge in the Title VII action, we held that his Title VII claim was not foreclosed by the arbitral decision against him.⁸ In addition, we declined to adopt a rule that would have required federal courts to defer to an arbitrator's decision on a discrimination claim when "(i) the claim was before the arbitrator; (ii) the collective-bargaining agreement prohibited the form of discrimination charged in the suit under Title VII; and (iii) the arbitrator has authority to rule on the claim and to fashion a remedy." Id., at 55-56, 94 S.Ct., at 1023.

Similarly, in Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 101 S.Ct. 1437, 67 L.Ed.2d 641 (1981), Barrentine and a fellow employee had unsuccessfully submitted wage claims to arbitration. Nevertheless, we rejected the contention that the arbitration award precluded a subsequent suit based on the same underlying facts alleging a violation of the minimum wage provisions of the Fair Labor Standards Act. Id., at 745-746, 101 S.Ct., at 1447.

Our rejection of a rule of preclusion in Barrentine and our rejection of a rule of deferral in Gardner-Denver were based in large part on our conclusion that Congress intended the statutes at issue in those cases to be judicially enforceable and that arbitration could not provide an adequate substitute for judicial proceedings in adjudicating claims under those statutes. 450 U.S., at 740-746, 101 S.Ct., at 1444-1447; 415 U.S., at 56-60, 94 S.Ct., at 1023-25. These considerations similarly require that we find the doctrines of res judicata and collateral estoppel inapplicable in this § 1983 action.

Because § 1983 creates a cause of action, there is, of course, no question that Congress intended it to be judicially enforceable. Indeed, as we explained in Mitchum v. Foster, 407 U.S. 225, 242, 92 S.Ct. 2151, 2162, 32 L.Ed.2d 705 (1972), "[t]he very purpose of § 1983 was to interpose the federal courts between the States and the people, as guardians of the people's federal rights—to protect the people from unconstitutional action under color of state law." See also Patsy v. Florida Board of Regents, 457 U.S. 496, 503, 102 S.Ct. 2557, 2561, 73 L.Ed.2d 172 (1982). And, although arbitration is well suited to resolving contractual disputes, our decisions in Barrentine and Gardner-Denver compel the conclusion that it cannot provide an adequate substitute for a judicial proceeding in protecting the federal statutory and constitutional rights that § 1983 is designed to safeguard. As a...