Farrimond v. Board of Educ. of East Jordan Public Schools, Docket No. 71228

• Decision Date: 06 December 1984
• Docket Number: Docket No. 71228
• Parties: , 21 Ed. Law Rep. 1015 Kathryn FARRIMOND, Petitioner-Appellee, v. BOARD OF EDUCATION OF the EAST JORDAN PUBLIC SCHOOLS, Respondent-Appellant, and State Tenure Commission, Defendants.
• Court: Court of Appeal of Michigan — District of US

Page 245

359 N.W.2d 245

138 Mich.App. 51, 21 Ed. Law Rep. 1015

Kathryn FARRIMOND, Petitioner-Appellee, v. BOARD OF EDUCATION OF the EAST JORDAN PUBLIC SCHOOLS Respondent-Appellant and State Tenure Commission, Defendants.

Docket No. 71228.

Court of Appeals of Michigan.

Submitted Dec. 14, 1983.

Decided Oct. 2, 1984.

Released for Publication Dec. 6, 1984.

Foster, Swift, Collins & Coey, P.C. by Arthur R. Przybylowicz, Lansing, for petitioner-appellee.

Thrun, Maatsch & Nordberg, P.C. by G. Michael White, Lansing, for respondent-appellant.

Before J.H. GILLIS, P.J., and SHEPHERD and KELLEY, ^* JJ.

PER CURIAM.

Appellee petitioned the Michigan Teacher Tenure Commission (Commission) for relief, alleging that certain action taken by appellant constituted a demotion which was not only wrongful but which had occurred without the notice and hearing required by the teachers' tenure act. The Commission granted appellant's request for accelerated judgment, however, ruling that appellant's actions had not constituted a demotion and the Commission therefore had no jurisdiction over the parties' dispute. On appeal, the circuit court reversed the order of the Commission and remanded for a determination of the back pay due appellee. Appellant appeals as of right.

By stipulation of the parties, this dispute was considered by the Commission strictly on the basis of certain agreed-upon documents submitted to the Commission, including a stipulation of facts and a copy of the collective bargaining agreement between appellant Board of Education and the Northern Michigan Education Association (of which appellee was a member) which governed the years in question. No other evidence or testimony was submitted to the Commission. The stipulated facts made available to the Commission read as follows:

"1. Appellant is a teacher on continuing tenure with Appellee within the meaning of the Teacher Tenure Act.

"2. Appellee is a controlling board within the meaning of the Teacher Tenure Act.

"3. Appellant was first employed with Appellee in the 1970-71 school year and has been continuously employed with Appellee since that time.

"4. In the 1976-77 school year, Appellee was paid at an annual rate of $14,338.00, being step 8 of the salary schedule for a teacher with a master's degree.

"5. The Master Agreement current in the 1976-77 school year expired in the summer of 1977, no new agreement was placed into effect as regards salaries until November 18, 1977.

"6. A copy of the new agreement is attached as Exhibit A.

"7. In the fall of 1977, all teachers employed by Appellee were retained by the prior years' salary step until such time as the new agreement was settled, at which time all teachers were placed on their respective steps in the new agreement with retroactive adjustment to September 1, 1977.

"8. As applied to Appellant, this procedure meant that she was paid at an annual rate of $14,338.00 before November 18, 1977; as of November 18, 1977, Ms. Farrimond was paid at an annual rate of $15,492.00, being step 8 1/2 for a teacher with a master's degree.

"9. The parties to this appeal are engaged in a good faith dispute as to the appropriate step level of pay for Ms. Farrimond, Appellee contending that the Master Agreement would place Ms. Farrimond on step 8 1/2 and that her individual contracts (attachment B) have been subject to the terms of the Master Agreement; Ms. Farrimond contending that she was first hired at a step level, the continual progress of which would place her at step 9 and that the actions of Appellee up to November 18, 1977 constitute a past employment practice.

"10. The placement of Appellant on the salary schedule, which initially gave her a full year experience for one-half year of teaching experience, by the former Superintendent of Schools was intentional and her placement was reviewed and accepted by a succeeding Superintendent of Schools, as indicated in the attached letter.

"11. The procedures prescribed in the Teacher Tenure Act with regard to discharge or demotion of a tenured teacher have not been followed in this case.

"12. That there are and have been other teachers at the East Jordan School District who have received salaries at half step levels based upon a half year of experience."

Apparently appellee, when hired by appellant in 1970, was given one year of credit in terms of placement on the then-operative salary schedule for only one-half year of teaching experience. The contract entered into by the parties in November, 1977, and made retroactive to September, 1977, however, was interpreted by appellant to require placement of appellee at a step on the salary schedule which reflected her actual total years of teaching experience at that time, resulting in a move of only one-half step up the schedule for appellee from that of the previous year, rather than the full step expected by appellee and apparently received by all other teachers in the district. While the move accurately reflected appellee's actual experience, she alleged that the extra one- half year she had initially been credited with, since it had not been taken from her in the seven years she had taught for appellant, constituted the fruits of a past employment practice which could not now be gratuitously modified.

Based on the collective bargaining agreement and the facts as stipulated to by the parties, the Commission ruled that appellant's action did not constitute a demotion. The Commission therefore ruled that it had no subject matter jurisdiction over the dispute, which was more properly resolved through prescribed collective bargaining procedures. We agree.

In reviewing the decisions of an administrative agency, a court may set aside that decision or order only if substantial rights of the petitioning appellant have been prejudiced "because the decision or order [was] * * * [i]n violation of * * * a statute * * * [or] * * * [a]rbitrary, capricious or clearly an abuse or unwarranted exercise of discretion [or] * * * [a]ffected by other substantial and material error of law". M.C.L. Sec. 24.306; M.S.A. Sec. 3.560(206). The reviewing court may not substitute its judgment for that of the agency in the absence of fraud or jurisdictional defect. An agency's findings of fact are conclusive unless they are unsupported by substantial evidence. Regents of the University of Michigan v. Employment Relations Comm., 389 Mich. 96, 204 N.W.2d 218 (1973); Murphy v. Oakland County Dep't of Health, 95 Mich.App. 337, 290 N.W.2d 139 (1980). Where a case has been submitted for decision upon an agreed-upon statement of facts, that statement must be taken as conclusive. The only question for the reviewing court then is whether the judgment was supported by the stipulated facts. Kretzschmar v. Rosasco, 250 Mich. 9, 229 N.W. 446 (1930).

In the instant case, however, the circuit court apparently disregarded or contradicted at least a portion of the stipulated facts when it determined that appellant's "attempt to reach back seven years for a basis to deny [Ms. Farrimond] her rightful salary is belated and clearly arbitrary". To the contrary, the parties had stipulated that they were "engaged in a good faith dispute as to the appropriate step level of pay" for appellee.

As to the legal conclusions reached by the Commission, "[t]he construction given to a statute by those charged with the duty of executing it is always entitled to the most respectful consideration and ought not to be overruled without cogent reasons". Magreta v. Ambassador Steel Co. (On Reh), 380 Mich. 513, 519, 158 N.W.2d 473 (1968). Here, the Tenure Commission ruled that, on the facts as stipulated by the parties, appellee had not been demoted under the teachers' tenure act which defines "demote" as "to reduce compensation or to transfer to a position carrying a lower salary". (Emphasis added.) M.C.L. Sec. 38.74; M.S.A. Sec. 15.1974. In similar cases before the Commission, the Commission had also held that placement of a teacher on a schedule resulting in less of a raise than would have resulted from payment under the previous method did not constitute a demotion. Since there was no guarantee to any one employee regarding his rate of salary increase in the ensuing years after he was employed, a board of education was under no obligation to maintain a differential once a single salary schedule had been negotiated placing all employees on that single wage scale. Hanson v. School Dist. of the City of Benton Harbor, (State Tenure Commission, Docket No. 71-42). The circuit court erroneously cited Hanson in its opinion, claiming that Hanson was distinguishable from the instant case because a new agreement had been negotiated between the parties there, requiring placement of Hanson at a particular step. However, such was not the case here as the contract was interpreted by appellant's administrators. Highhouse v. Bd. of Ed. of the Grand Rapids Public Schools, (State Tenure Commission, Docket No. 82-13), cited by the dissent, is distinguishable from the instant case in several aspects. Most notably, the teachers there were transferred to positions to which a generally lower salary schedule applied.

Past decisions of the Commission had never defined "demotion" in terms of a teacher's "reasonable expectation" of a "full yearly increment", the standard employed by the circuit court and the Commission dissent here. ¹ In fact, several Tenure Commission decisions had held that terms of collective bargaining agreements must be considered when determining whether a demotion has occurred. Where a collective bargaining agreement allowed deviation from the applicable step of the salary schedule, retention at one level of a teacher with observed deficiencies resulted in no "reduction in compensation"; hence there was no demotion. Cutshall v. Zeeland Public Schools (State Tenure Commission, Docket No. 73-42); see also Niemi v. Kearsley Community School Dist., 103 Mich.App. 818, 303...