In re Arbitration Between United Pub. Workers

• Decision Date: 13 March 2020
• Docket Number: NO. CAAP-16-0000666,CAAP-16-0000666
• Citation: 459 P.3d 792 (Table)
• Parties: In the MATTER OF the ARBITRATION BETWEEN UNITED PUBLIC WORKERS, AFSCME, LOCAL 646, AFL-CIO, Union-Appellant, and State of Hawai‘i, DEPARTMENT OF TRANSPORTATION; LA-15-02 (Glen Tanaka) (2016-003), Employer-Appellee
• Court: Hawaii Court of Appeals

459 P.3d 792 (Table)

In the MATTER OF the ARBITRATION BETWEEN UNITED PUBLIC WORKERS, AFSCME, LOCAL 646, AFL-CIO, Union-Appellant,

and

State of Hawai‘i, DEPARTMENT OF TRANSPORTATION; LA-15-02 (Glen Tanaka) (2016-003), Employer-Appellee

NO. CAAP-16-0000666

Intermediate Court of Appeals of Hawai‘i.

March 13, 2020

On the briefs:

Herbert R. Takahashi, and Rebecca L. Covert, (Takahashi and Covert), for Union-Appellant.

Robert T. Nakatsuji, Deputy Solicitor General for Employer-Appellee.

(By: Leonard, Presiding Judge, Chan and Hiraoka, JJ.)

MEMORANDUM OPINION

Union-Appellant, United Public Workers, AFSCME, Local 646, AFL-CIO (UPW), appeals from the September 22, 2016 Judgment entered by the Circuit Court of the First Circuit (circuit court)¹ in Special Proceeding No. 16-1-0081. UPW also challenges the circuit court's May 6, 2016 "Order Denying UPW's Motion to Confirm Arbitration Decision and Award, to Enter Judgment, and for Other Appropriate Relief Filed on March 9, 2016" (Order Denying UPW's First Motion to Confirm) and the September 16, 2016 "Order Granting in Part and Denying in Part UPW's Motion to Confirm Arbitration Decisions and Awards, to Enter Final Judgment, and for Appropriate Relief Filed on July 8, 2016" (Order Partially Granting/Denying UPW's Second Motion to Confirm).

I. BACKGROUND

On January 4, 2016, UPW and the State of Hawai‘i, Department of Transportation (State) began arbitration proceedings.² The arbitration arose from a grievance filed by UPW on behalf of Glenn Tanaka, who had been discharged from his employment with the State, effective March 19, 2015. On the first day of the arbitration proceedings, the State made an oral motion to dismiss the grievance, arguing, among other things, that pursuant to the collective bargaining agreement (CBA) in effect between the parties, UPW did not timely file the Step 1 grievance and UPW was not permitted to file its Step 2 grievance without first having a Step 1 meeting.

After receiving written briefs from the parties on the State's motion to dismiss, the Arbitrator issued his Decision on Arbitrability dated February 3, 2016, denying the State's motion. The Arbitrator determined that the State's defense of untimeliness was waived, as the CBA prohibits parties from raising allegations not asserted prior to arbitration and the State had not previously asserted that the grievance was untimely filed. The Arbitrator also determined that the CBA permitted UPW to file a Step 2 grievance although no Step 1 meeting occurred. The arbitration proceedings continued to its conclusion.

On March 7, 2016, UPW filed a "Motion to Confirm Arbitration Decision and Award, to Enter Judgment, and For Other Appropriate Relief" (First Motion to Confirm) in the circuit court, requesting that the court: confirm the Decision on Arbitrability pursuant to Hawaii Revised Statutes (HRS) § 658A-22 (2016)³ ; enter a judgment pursuant to HRS § 658A-25(a) (2016)⁴ ; and grant UPW attorney's fees and costs pursuant to HRS § 658A-25(b) and (c). On May 6, 2016, the circuit court issued its Order Denying UPW's First Motion to Confirm⁵ on the basis that the Decision on Arbitrability "does not constitute an ‘Award’ for the purposes of § 658A-19^{[6 ]} and § 658A-22, HRS, but [is] simply an intermediate decision not subject to confirmation under § 658A-22, HRS."

On June 20, 2016,⁷ The Arbitrator issued his Decision and Award, sustaining four of the ten charges that served for the basis of Glenn Tanaka's discharge, and reducing his disciplinary action from discharge to twenty days suspension with no back pay. The Decision and Award included a summary of the Decision on Arbitrability.

On July 8, 2016, UPW filed a "Motion to Confirm Arbitration Decisions and Awards, to Enter Final Judgment, and For Appropriate Relief" (Second Motion to Confirm), requesting that the circuit court: confirm both the Decision on Arbitrability and the Decision and Award pursuant to HRS § 658A-22 ; enter a final judgment for both decisions pursuant to HRS § 658A-25(a) ; and grant appropriate relief including costs and attorney's fees pursuant to HRS § 658A-25(b) and (c). On September 16, 2016, the circuit court issued its Order Partially Granting/Denying UPW's Second Motion to Confirm, which: (1) granted UPW's request to confirm the Decision and Award, which had incorporated the Decision on Arbitrability, but did not confirm the Decision on Arbitrability as a separate award; (2) denied UPW's request for costs, finding that it was within the circuit court's discretion under HRS § 658A-25(b) and would be inequitable because the State prevailed on UPW's First Motion to Confirm and agreed not to seek costs; and (3) denied UPW's request for attorney's fees, determining that attorney's fees are not permissible under HRS § 658A-25(c) where the State did not contest confirmation of the Decision and Award.

UPW timely appealed on October 10, 2016.

II. POINTS OF ERROR

On appeal, UPW asserts that the circuit court erred by: (1) not confirming the Decision on Arbitrability in the Order Denying UPW's First Motion to Confirm; (2) not confirming the Decision on Arbitrability as a separate award from the Decision and Award in the Order Partially Granting/Denying UPW's Second Motion to Confirm; (3) declining to award UPW attorney's fees and costs associated with its Second Motion to Confirm. UPW also contends that if this court determines that the First Motion to Confirm should have been granted, then the circuit court erred in not awarding attorney’s fees and costs for that motion.

III. STANDARDS OF REVIEW

A. Arbitration Awards

"We review the circuit court's ruling on an arbitration award de novo , but we also are mindful that the circuit court's review of arbitral awards must be extremely narrow and exceedingly deferential." Tatibouet v. Ellsworth, 99 Hawai‘i 226, 233, 54 P.3d 397, 404 (2002) (internal quotation marks, citations, and brackets omitted).

Judicial review of an arbitration award is limited by the following precepts:

First, because of the legislative policy to encourage arbitration and thereby discourage litigation, arbitrators have broad discretion in resolving the dispute. Upon submission of an issue, the arbitrator has authority to determine the entire question, including the legal construction of terms of a contract or lease, as well as the disputed facts. In fact, where the parties agree to arbitrate, they thereby assume all the hazards of the arbitration process, including the risk that the arbitrators may make mistakes in the application of law and in their findings of fact.

Second, correlatively, judicial review of an arbitration award is confined to the strictest possible limits. An arbitration award may be vacated only on the four grounds specified in HRS § 658-9 and modified and corrected only on the three grounds specified in HRS § 658-10. Moreover, the courts have no business weighing the merits of the award.

Third, HRS §§ 658-9 and -10 also restrict the authority of appellate courts to review judgments entered by circuit courts confirming or vacating the arbitration awards.

Daiichi Hawai‘i Real Estate Corp. v. Lichter, 103 Hawai‘i 325, 336, 82 P. 3d 411, 422 (2003) (internal quotation marks, brackets, ellipses points, and citations omitted).

Schmidt v. Pac. Benefit Servs., Inc., 113 Hawai‘i 161, 165-66, 150 P. 3d 810, 814-15 (2006).

B. Statutory Interpretation

Questions of statutory interpretation are questions of law to be reviewed de novo under the right/wrong standard.

Our statutory construction is guided by the following well established principles:

our foremost obligation is to ascertain and give effect to the intention of the legislature, which is to be obtained primarily from the language contained in the statute itself. And we must read statutory language in the context of the entire statute and construe it in a manner consistent with its purpose.

When there is doubt, doubleness of meaning, or indistinctiveness or uncertainty of an expression used in a statute, an ambiguity exists....

In construing an ambiguous statute, "[t]he meaning of the ambiguous words may be sought by examining the context, with which the ambiguous words, phrases, and sentences may be compared, in order to ascertain their true meaning. Moreover, the courts may resort to extrinsic aids in determining legislative intent. One avenue is the use of legislative history as an interpretive tool."

This court may also consider "[t]he reason and spirit of the law, and the cause which induced the legislature to enact it ... to discover its true meaning."

Lingle v. Hawaii Gov't Employees Ass'n, AFSCME, Local 152, AFL-CIO, 107 Hawai‘i 178, 183, 111 P.3d 587, 592 (2005) (quoting Guth v. Freeland, 96 Hawai‘i 147, 149-50, 28 P.3d 982, 984-85 (2001) ).

IV. DISCUSSION

A. The Decision on Arbitrability was not an "award" subject to confirmation under HRS § 658A-22.

In its Order Denying UPW's First Motion to Confirm, the circuit court determined that based on our holding in United Public Workers, AFSCME, Local 646, AFL-CIO v. City and County of Honolulu, 124 Hawai‘i 367, 244 P.3d 604 (App. 2010), the Decision on Arbitrability did "not constitute an ‘Award’ for the purposes of § 658A-19 and § 658A-22, HRS, but [was] simply an intermediate decision not subject to Confirmation under § 658A-22, HRS."

On appeal, UPW asserts that the circuit court's determination was in error because HRS § 658A-19 amounts to a statutory definition of "award" and compliance with the statute resulted in the Decision on Arbitrability becoming an "award" subject to confirmation. UPW also cites various federal cases for the proposition that an arbitrator's intermediate decision may be confirmed by the circuit court if: (1) the parties agreed to bifurcate the proceedings; and/or (2) the decision finally and definitely disposes of a separate and independent claim. Additionally, UPW argues that United Public Workers, AFSCME, Local 646, AFL-CIO, 124 Hawai‘i 367, 244 P.3d 604, is not controlling here because it was...