Chiles v. United Faculty of Florida

• Citation: 615 So.2d 671
• Decision Date: 11 March 1993
• Docket Number: No. 81252,81252
• Parties: 143 L.R.R.M. (BNA) 2136, 143 L.R.R.M. (BNA) 2806, 18 Fla. L. Week. S143 Lawton CHILES, et al., Appellants, v. UNITED FACULTY OF FLORIDA, et al., Appellees.
• Court: United States State Supreme Court of Florida

Page 671

615 So.2d 671

143 L.R.R.M. (BNA) 2136, 143 L.R.R.M. (BNA) 2806,

18 Fla. L. Week. S143

Lawton CHILES, et al., Appellants, v. UNITED FACULTY OF FLORIDA, et al., Appellees.

No. 81252.

Supreme Court of Florida.

March 11, 1993.

On Motion for Clarification

March 23, 1993.

Robert A. Butterworth, Atty. Gen., and Kimberly J. Tucker, Deputy Gen. Counsel, Dept. of Legal Affairs, Tallahassee, for appellants.

Thomas W. Brooks of Meyer and Brooks, P.A., Tallahassee, for United Faculty of Florida, FTP-NEA.

Benjamin R. Patterson, III and Jerry G. Traynham of Patterson and Traynham, Tallahassee, for Florida Public Employees Council 79, AFSCME, et al.

Gene "Hal" Johnson, Tallahassee, for Florida Police Benevolent Ass'n.

Ronald G. Meyer of Meyer and Brooks, P.A., Tallahassee, for Federation of Physicians and Dentists, Nat. Union of Hosp. and Healthcare Employees.

KOGAN, Justice.

We have on appeal an order of the circuit court certified by the First District Court of Appeal as a matter of great public importance requiring immediate resolution by this Court. We have jurisdiction. Art. V, Sec. 3(b)(5), Fla. Const.

The various Appellees are unions representing classes of public employees unable to resolve a collective bargaining process for pay and benefits during the fiscal year 1991-92. Pursuant to its statutory authority, the Legislature resolved the impasse by authorizing a three-percent pay raise to be effective January 1, 1992. Ch. 91-272, Laws of Fla. The unions ratified the raise.

Subsequently state officials projected a shortfall in public revenues. To meet the shortfall, the Legislature convened in special session in December 1991 and, among other measures, postponed the planned pay raises until February 15, 1992. Ch. 91-428, Laws of Fla. Later during the 1992 regular session, the Legislature responded to continuing revenue shortfalls by eliminating the pay raises altogether. Ch. 92-5, Laws of Fla.

The unions filed suit, and the trial court ruled in their favor. The court determined that the legislative actions here violated the right to collectively bargain and constituted an impermissible impairment of contract. Art. I, Secs. 6, 10, Fla. Const. The state appealed, and the district court certified the case for our immediate review.

We begin by noting that the present case is factually quite different from our recent opinion in State v. Florida Police Benevolent Association, 613 So.2d 415 (Fla.1992). There we dealt with a situation in which no final agreement had been reached between the parties, unlike here where an agreement was reached and funded, then unilaterally modified by the legislature, and finally unilaterally abrogated by the legislature. Accordingly, we do not believe that the result reached in Police Benevolent dictates the result here.

The state now argues that whatever agreement was reached between it and the unions somehow failed to reach the level of a fully enforceable contract. Indeed, the logical conclusion of the state's position is that public-employee bargaining agreements cannot ever constitute fully binding contracts, even after they are accepted and funded. We cannot accept this position.

Likewise we cannot accept the state's argument that the legislature is not a "party" to the contract and thus cannot be bound by the agreement after expressing legislative assent through the act of appropriating funds. The state itself clearly is a party to the contract, and the legislature is a constituent branch of the state. Once the executive has negotiated and the legislature has accepted and funded an agreement, the state and all its organs are These conclusions are compelled by the Florida Constitution. The right to contract is one of the most sacrosanct rights guaranteed by our fundamental law. It is expressly guaranteed by article I, section 10 of the Florida Constitution, and is equally enforceable in labor contracts by operation of article I, section 6 of the Florida Constitution. The legislature has only a very severely limited authority to change the law to eliminate a contractual obligation it has itself created. Art. I, Sec. 10, Fla. Const. As we stated in Police Benevolent, 613 So.2d at 421,

bound by that agreement under the principles of contract law. The act of funding through a valid appropriation is the point in time at which the contract comes into existence. Police Benevolent, 613 So.2d at 419, 419 n. 5.

[w]here the legislature provides enough money to implement the benefit as negotiated, but attempts to unilaterally change the benefit, the changes will not be upheld, and the negotiated benefit will be enforced.

We recognize that in the sensitive area of a continuing appropriation obligation for salaries and perhaps in other contexts as well, the legislature must be given some leeway to deal with bona fide emergencies. Accordingly, we agree with the trial court that the legislature has authority to reduce previously approved appropriations to pay public workers' salaries made pursuant to a collective bargaining agreement, but only where it can demonstrate a compelling state interest. Art. I, Secs. 6, 10, Fla. Const.; Hillsborough County Governmental Employees Ass'n, Inc. v. Hillsborough County Aviation Authority, 522 So.2d 358 (Fla.1988).

Before that authority can be exercised, however, the legislature must demonstrate no other reasonable alternative means of preserving its contract with public workers, either in whole or in part. The mere fact that it is politically more expedient to eliminate all or part of the contracted funds is not in itself a compelling reason. Rather, the legislature must demonstrate that the funds are available from no other possible reasonable source. Accord United States Trust Co. v. New Jersey, 431 U.S. 1, 97 S.Ct. 1505, 52 L.Ed.2d 92 (1977); Association of Surrogates and Supreme Court Reporters v. New York, 940 F.2d 766 (2d Cir.1991); Sonoma County Organization of Public Employees v. County of Sonoma, 23 Cal.3d 296, 152 Cal.Rptr. 903, 591 P.2d 1 (1979). That has not happened here.

We do not agree that the savings clauses in the contracts are sufficient to nullify them. The savings clauses clearly were meant as a means of preserving the contracts in the event of partial invalidity; they are not an escape hatch for the legislature. Indeed, were we to accept the state's position on this point, we necessarily would be required to conclude that there was no contract here at all for lack of mutuality because one party could nullify the agreement at any time, and for any reason. Obviously the parties intended there to be a contract, and we will construe the provisions so as to achieve that result.

Finally, we are not today revisiting or modifying our opinion in Chiles v. Children A, B, C, D, E, & F, 589 So.2d 260 (Fla.1991), where we reaffirmed Florida's strong separation of powers doctrine. The present case does not itself present a violation of separation of powers, nor are we attempting a judicial appropriation of public money. Here, the legislature acted pursuant to its powers, appropriated funds for collective bargaining agreements, and thereby created a binding contract. Having exercised its appropriation powers, the legislature cannot now change its mind and renege on the contract so created without sufficient reason. Separation of powers does not allow the unilateral and unjustified legislative abrogation of a valid contract.

Accordingly, we affirm the order of the trial court below based on article I, sections 6 and 10 of the Florida Constitution, and the Appellants are hereby directed to adjust the pay and pay records of all employees covered by the collective bargaining agreements that are the subject of this opinion, and to otherwise take necessary It is so ordered.

steps to implement the pay raise covered by this opinion retroactive to January 1, 1992, as required by chapter 91-272, section 5, Laws of Florida. ¹

BARKETT, C.J., and SHAW, J., concur.

GRIMES and HARDING, JJ., concur with an opinion, in which BARKETT, C.J., concurs.

OVERTON, J., dissents with an opinion.

McDONALD, J., dissents with an opinion, in which OVERTON, J., concurs.

GRIMES, Justice, concurring.

There is no doubt that the shortfall in projected state revenue which was then approaching $700 million required drastic legislative action in order to balance the budget. However, because the state had contracted for the public workers' pay raise, I believe that the legislature was required first to make other reasonable reductions in appropriations or seek other reasonable sources of revenue. Given the fact that the total annual state budget exceeded $28 billion, I cannot say that the legislature had a sufficiently compelling state interest to repudiate the contract by eliminating the $35.4 million necessary to fund the pay raise.

BARKETT, C.J., concurs.

HARDING, Justice, concurring.

I concur with the majority in affirming the order of the trial court below. I find that the legislature acted in violation of article I, sections 6 and 10 of the Florida Constitution when it rescinded the three-percent pay raise which it had previously authorized.

I agree with the majority that State v. Florida Police Benevolent Association, 613 So.2d 415 (Fla.1992), is not applicable to this case. In Police Benevolent, the governor entered into collective bargaining agreements with several unions. However, the legislature altered those agreements in its general appropriations act. This Court found that "[w]here the legislature does not appropriate enough money to fund a negotiated benefit, as it is free to do, then the conditions it imposes on the use of the funds will stand even if contradictory to the negotiated agreement." Id. at 421.

In contrast, the instant case did not involve a negotiated agreement because the governor and the unions reached an impasse. Pursuant to section 447.403(4)(d), Florida Statutes (1991), the legislature resolved the impasse by...