Fratus v. MARION COMMUNITY SCHOOLS BD.

• Decision Date: 27 December 1999
• Docket Number: No. 27A02-9901-CV-12.,27A02-9901-CV-12.
• Citation: 721 N.E.2d 280
• Parties: Teresa FRATUS, Sharon A. Wilson, and Wilma R. Higdon, Appellants-Plaintiffs, v. MARION COMMUNITY SCHOOLS BOARD OF TRUSTEES and Marion Teachers Association, Appellees-Defendants.
• Court: Indiana Appellate Court

721 N.E.2d 280

Teresa FRATUS, Sharon A. Wilson, and Wilma R. Higdon, Appellants-Plaintiffs, v. MARION COMMUNITY SCHOOLS BOARD OF TRUSTEES and Marion Teachers Association, Appellees-Defendants.

No. 27A02-9901-CV-12.

Court of Appeals of Indiana.

December 27, 1999.

Brenda Franklin Rodeheffer, Monday Rodeheffer Jones & Albright, Indianapolis, Indiana, Attorney for Appellants.

Michael J. Kiley, Craig R. Persinger, Kiley, Kiley, Harker, Michael & Certain, Marion, Indiana, Richard J. Darko, Eric M. Hylton, Lowe Gray Steele & Darko, LLP, Indianapolis, Indiana, Attorneys for Appellees.

OPINION

RILEY, Judge

STATEMENT OF THE CASE

Appellants-Plaintiffs, Teresa Fratus (Fratus), Sharon A. Wilson (Wilson), and Wilma R. Higdon (Higdon) (collectively referred to as the Teachers), appeal the trial court's dismissal of their Complaint filed against Appellees-Defendants, Marion Community Schools Board of Trustees (School Board) and Marion Teachers Association (Association).

We reverse and remand with instructions.

ISSUES

The Teachers raise two issues for our consideration on appeal, which we restate as follows:

1. Whether the trial court properly dismissed the Teachers' Amended Complaint against the Association when the Teachers failed to exhaust their administrative remedies before the Indiana Education Employment Relations Board (IEERB) prior to filing suit.

2. Whether the trial court properly dismissed the Teachers' Amended Complaint against the School Board when the Teachers failed to exhaust their administrative remedies before the IEERB prior to filing suit.

FACTS AND PROCEDURAL HISTORY

At the time of filing their Complaint, Fratus, Wilson and Higdon were teachers employed by the School Board and members of the Association. In 1997, each teacher formally notified the School Board of their intention to accept early retirement in 1998 pursuant to the terms of the 1995-1997 Master Contract between the School Board and the Association. After the Teachers gave their notice of their intention to elect early retirement, the Association and the School Board renegotiated the Master Contract. The Association is the exclusive representative of all the teachers within its bargaining unit pursuant to the Certificated Educational Employee Bargaining Act (CEEBA), Ind. Code § 20-7.5-1. The 1998 Master Contract in general gave more benefits to the teachers of the Marion Community Schools; however, the contract greatly reduced the benefits to those teachers who elected to take early retirement in 1998. The School Board and the Association notified the Teachers that the 1998 Master Contract controlled their retirement benefits. Due to the revision in the Master Contract, the Teachers lost approximately $30,000 in retirement benefits.

The Teachers' Amended Complaint alleges a breach of duty of fair representation against the Association and a breach of contract claim against the School Board. The Association filed a motion to dismiss the Teachers' Complaint pursuant to Ind. Trial Rule 12(B)(1) and 12(B)(6). The School Board filed an Answer and Affirmative Defenses asserting that the Teachers lacked standing, the Teachers failed to state a claim upon which relief can be granted, the trial court lacked subject matter jurisdiction, and that the Teachers failed to exhaust their administrative remedies.

After a hearing on the Association's motion to dismiss, the trial court dismissed the Teachers' Complaint pursuant to T.R. 12(B)(1) concluding that the trial court lacked subject matter jurisdiction as a result of the Teachers' failure to exhaust their administrative remedies before the IEERB. This appeal ensued.

DISCUSSION AND DECISION

Jurisdiction

We initially address the issue of this court's jurisdiction as raised by the School Board in its Appellee's Brief. The School Board argues that the trial court's Order of Dismissal is not a final appealable order under Ind.Appellate Rule 4(A), because the trial court dismissed this case without prejudice, expressly giving the Teachers the right to refile after they exhausted their administrative remedies. This argument is without merit. A dismissal of an action based on T.R. 12(B)(1) would typically be without prejudice, because the case is being dismissed without being decided on its merits. "A dismissal under Trial Rule 12(B)(1) is not an adjudication on the merits nor is it res judicata. A plaintiff thus is free to refile the action in the same tribunal or another tribunal that has jurisdiction." Perry v. Stitzer Buick GMC, Inc., 637 N.E.2d 1282, 1286 (Ind.1994). However, just because the Teachers have an opportunity to refile, does not mean that this case has not been finally determined. "A final appealable order, or judgment of the court, is one which disposes of all issues as to all parties thereby ending the particular case." Doperalski v. City of Michigan City, 619 N.E.2d 584, 585 (Ind.Ct.App.1993). The granting of a motion to dismiss is a final appealable judgment. State ex rel. Clay Community Schools v. Parke Circuit Court, 271 Ind. 266, 392 N.E.2d 804, 805 (1979). Therefore, the order of the trial court dismissing the Teachers' Amended Complaint is a final appealable order, and this appeal is properly before this court.

Standard of Review

When ruling on a T.R. 12(B)(1) motion to dismiss for lack of subject matter jurisdiction, the trial court must decide whether it possesses the authority to further adjudicate the action. Common Council of City of Hammond v. Matonovich, 691 N.E.2d 1326, 1328 (Ind.Ct.App. 1998), trans. denied. A T.R. 12(B)(1) motion to dismiss is decided based upon a consideration of the complaint, the motion, and any affidavits or other evidence submitted. Id. Further, the court may weigh the evidence to determine the existence of jurisdictional facts. Id.

"Lack of subject matter jurisdiction is an affirmative defense which may be raised in the pleadings, see T.R. 8(C), or on motion under 12(B)(1)." Perry, 637 N.E.2d at 1286. Here, the Association filed a motion to dismiss based on T.R. 12(B)(1) and the School Board filed an affirmative defense claiming the trial court lacked subject matter jurisdiction pursuant to T.R. 8(C). Thus, both defendants properly raised the issue of subject matter jurisdiction in the trial court. Moreover, "the absence of subject-matter jurisdiction is never waivable and there is a positive duty on a court, whether trial or appellate, to raise the question of subject-matter jurisdiction whenever it might appear ..." 1 WILLIAM F. HARVEY, INDIANA PRACTICE § 12.5 (2nd ed. 1987). Thus, it was appropriate for the trial court to decide the subject matter jurisdiction issue regarding both defendants, even though the Association was the only defendant to file a motion to dismiss.

In reviewing a trial court's dismissal of an action based on lack of subject matter jurisdiction under T.R. 12(B)(1), we review the trial court's decision de novo when the facts are not in dispute. Rieheman v. Cornerstone Seeds, Inc., 671 N.E.2d 489, 491 (Ind.Ct.App.1996), trans. denied. The parties herein are not disputing the determining facts of this case and all parties agree that the Teachers did not file a claim with IEERB prior to filing the lawsuit at issue. Thus, our review of this matter will be de novo.

Exhaustion of Administrative Remedies

The intent of the CEEBA is to develop "harmonious and cooperative relationships between school corporations and their certificated employees," to recognize "the right of school employees to organize" and to "prevent any material interference with the normal public school educational process." Ind.Code § 20-7.5-1-1.

The CEEBA sets forth the specific rights of school employees and school employers, at Ind.Code § 20-7.5-1-6, as follows:

(a) School employees shall have the right to form, join, or assist employee organizations, to participate in collective bargaining with school employers through representatives of their own choosing, and to engage in other activities, individually or in concert for the purpose of establishing, maintaining, or improving salaries, wages, hours, salary and wage related fringe benefits, and other matters as defined in sections 4¹ and 5² of this chapter. A school employee may not be required to join or financially support through the payment of fair share fees, representation fees, professional fees, or other fees, a school employee organization. A rule, regulation, or contract provision requiring financial support from a school employee to a school employee organization is void.

(b) School employers shall have the responsibility and authority to manage and direct in behalf of the public the operations and activities of the school corporation to the full extent authorized by law. Such responsibility and activity shall include but not be limited to the right of the school employer to:

(1) direct the work of its employees;

(2) establish policy through procedures established in sections 4 and 5 of this chapter (3) hire, promote, demote, transfer, assign, and retain employees through procedures established in sections 4 and 5 of this chapter;

(4) suspend or discharge its employees in accordance with applicable law through procedures established in sections 4 and 5 of this chapter;

(5) maintain the efficiency of school operations;

(6) relieve its employees from duties because of lack of work or other legitimate reason through procedures established in sections 4 and 5 of this chapter; and

(7) take actions necessary to carry out the mission of the public schools as provided by law.

The IEERB is the administrative agency created by the General Assembly to administer the provisions of the CEEBA. Ind.Code § 20-7.5-1-9. The IEERB hears "unfair practices" complaints by school employees. Ind.Code § 20-7.5-1-7 defines "unfair practices" as:

(a) It shall be an unfair practice for a school employer to:

(1) interfere with, restrain or coerce school employees in the exercise of the rights

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