INTER. ASS'N OF FIRE. v. Spokane Airports, 70667-1.

• Court: United States State Supreme Court of Washington
• Citation: 45 P.3d 186,146 Wash.2d 207
• Decision Date: 25 April 2002
• Docket Number: No. 70667-1.,70667-1.
• Parties: INTERNATIONAL ASSOCIATION OF FIREFIGHTERS, LOCAL 1789, Respondent, v. SPOKANE AIRPORTS, a municipal corporation, Petitioner.

45 P.3d 186

146 Wash.2d 207

INTERNATIONAL ASSOCIATION OF FIREFIGHTERS, LOCAL 1789, Respondent, v. SPOKANE AIRPORTS, a municipal corporation, Petitioner.

No. 70667-1.

Supreme Court of Washington, En Banc.

Argued September 13, 2001.

Decided April 25, 2002.

Perkins, Coie, Jeffrey Alan Hollingsworth, Seattle, for Petitioner.

Hawkins & Guinn, George Roy Guinn, Spokane, for Respondent.

ALEXANDER, C.J.

We must decide if the Court of Appeals erred in concluding that the International Association of Firefighters, Local 1789 (Union), had standing to maintain this lawsuit for monetary relief on behalf of its members and that Union was not required, prior to bringing the suit, to engage in the arbitration process provided for in the collective bargaining agreement between it and Spokane Airports (Airport), a municipal corporation. If we answer these questions in the affirmative we must also decide if the Court of Appeals correctly concluded that the trial court did not err in granting a summary judgment to Union requiring Airport to refund contributions it made to its employees' social security and Medicare accounts from 1995 through 1998, and to continue contributing to these employees' accounts for the duration of the collective bargaining agreement. We affirm the Court of Appeals on all issues, concluding that Union had standing to bring this suit on behalf of its members, that it was not required to submit the dispute to arbitration, and that Airport was obliged by the compensatory nature of the social security and Medicare contributions in this employment relationship to refund the employer contributions from 1995 through 1998 and continue to fund the employees' pension plan for the duration of the collective bargaining agreement.

I.

In 1962, Airport, which operates its own fire department at the Spokane International Airport, contracted with the federal government in order that its fire department employees could obtain social security coverage. Consequently, each of its employees, all of whom were Union members, thereafter paid 6.2 percent of their wages into a social security account and 1.45 percent of their salary into a Medicare account. Airport matched the contributions of its employees.

On March 9, 1999, the employees, by means of Union referendum vote, exercised their right to opt-out of the social security plan. Airport then obtained refunds from the federal government for the amount of money each fire department employee paid into a social security and Medicare account during the period 1995 through 1998 and for Airport's matching contributions.¹

Union brought this suit against Airport in Spokane County Superior Court, on behalf of the fire department employees, alleging that Airport "wrongfully ... convert[ed] ... those refunds" of the employees' money. Clerk's Papers (CP) at 5. It demanded that Airport reimburse the employees for the social security and Medicare taxes that had been withheld from the employees' paychecks between the years 1995 through 1998. Union also asked that the matching contributions that Airport paid into its employees' social security accounts be paid over to it for the benefit of the employees. Although Airport eventually returned to the employees the funds that had been withheld from their paychecks for social security and Medicare coverage, it refused to pay over to Union the matching payments it paid into the employees' accounts from 1995 to 1998.

Union moved for a summary judgment requesting reimbursement by Airport of "[a]ll contributions to Social Security and Medicare for the years 1995 through 1998, [for] ... the employees for whom they were contributed." CP at 16. It also sought a judgment requiring Airport

to continue to contribute to each individual firefighter's qualified retirement plan, of plaintiffs' choosing, in the amount of 6.2% and 1.45% of each employee's monthly wages for each month the defendant failed to make such payments from and after March 9, 1999, until the expiration of the current bargaining agreement.²

CP at 85. The trial court granted Union's motion. Airport appealed to the Court of Appeals, Division Three, which affirmed the trial court. We then granted Airport's petition for review.

II.

Airport contends that Union lacked standing to maintain this suit for monetary relief on behalf of its members.³ In support of this contention it cites Ironworkers District Council v. University of Washington Board of Regents, 93 Wash.App. 735, 970 P.2d 351 (1999). In the Ironworkers case, Division One of the Court of Appeals adopted a position consistent with that taken by many federal courts, to wit: that "an organization does not have standing to invoke the court's remedial powers on behalf of its members where ... the organization seeks damages and yet alleges neither monetary injury to itself nor assignment of its members' damage claims." Ironworkers, 93 Wash.App. at 741,970 P.2d 351 (citing Warth v. Seldin, 422 U.S. 490, 515, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975)). In concluding that Union had standing here, Division Three indicated that it was "diverging from the federal bright-line rule adopted by Division One in Ironworkers "for the practical reason that "associational representation of the individual fire fighters was the most convenient and efficient method of litigating these issues." Int'l Ass'n of Firefighters, Local 1789 v. Spokane Airports, 103 Wash.App. 764, 771, 14 P.3d 193 (2000),review granted, 143 Wash.2d 1019, 25 P.3d 1019 (2001).

We are called upon to determine whether we should approve the rule set forth in Ironworkers or instead recognize, as Division Three did here, that an employee's organization is not precluded from bringing a suit for monetary damages on behalf of its members simply because it fails to assert that the association suffered monetary injury or that it had an assignment of its members' claim. If we adopt the latter position, we must also decide if the Court of Appeals was correct in concluding that the Union should be granted standing under the circumstances of this case.

An association has standing to bring suit on behalf of its members when the following criteria are satisfied: (1) the members of the organization would otherwise have standing to sue in their own right; (2) the interests that the organization seeks to protect are germane to its purpose; and (3) neither claim asserted nor relief requested requires the participation of the organization's individual members. Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 343, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977), cited with approval in Save a Valuable Env't v. City of Bothell, 89 Wash.2d 862, 576 P.2d 401 (1978)

. The first two criteria are easily established. We say that because the individual Union members clearly had standing to sue in their own right since the contributions Union seeks to have returned were made by Airport for the accounts of Airport's employees and as a part of the employees' total compensation package. Furthermore, as the collective bargaining agreement between Airport and Union makes clear, the purpose of Union, as the exclusive bargaining agent of its members, is to "maintain harmonious relations" with Airport and to "establish proper and equitable standards of wages, hours and other conditions of employment." CP at 25. Protection of its members' retirement accounts is germane to those purposes.

The question of whether the third criteria has been shown is more troublesome. In addressing that question we take note of the fact that Union is seeking monetary damages and not injunctive relief. Monetary damages are distinguishable from injunctive relief, in that injunctive relief generally benefits every member of an employee association equally whereas the amount of monetary damages an employee suffers may vary from employee to employee. See Warth, 422 U.S. at 515,

95 S.Ct. 2197. It is primarily for this reason that federal courts have not accorded standing to an association to seek monetary damages on behalf of its members if it has not alleged an injury to itself or received an assignment of its members' damage claim. See, e.g., Lake Lucerne Civic Ass'n v. Dolphin Stadium Corp., 801 F.Supp. 684 (S.D.Fla.1992); United Union of Roofers, Waterproofers, & Allied Trades No. 40 v. Ins. Corp. of Am., 919 F.2d 1398 (9th Cir. 1990); Telecomms. Research & Action Ctr. v. Allnet Communication Servs., Inc., 806 F.2d 1093 (D.C.Cir.1986).⁴ Central to the holdings in the aforementioned cases is the concern that the third criteria is not established because "claims for monetary relief necessarily involve individualized proof and thus the individual participation of association members." Ins. Corp. of Am.,

919 F.2d at 1400. Airport's challenge to Union's claim of standing focuses on this prong of the Hunt test.

Unlike the third prong of the test, the first two prongs are constitutional in that they ensure that article III, section 2's "case or controversy" requirements are satisfied. United Food & Commercial Workers Union Local 751 v. Brown Group, Inc., 517 U.S. 544, 116 S.Ct. 1529, 134 L.Ed.2d 758 (1996). The third prong is not, however, constitutionally based and is judicially self-imposed for "administrative convenience and efficiency, not on elements of a case or controversy within the meaning of the Constitution." United Food & Commercial Workers Union Local 751, 517 U.S. at 557, 116 S.Ct. 1529. Division Three observed this distinction in holding that the ultimate question is "whether the circumstances of the case and the relief requested make individual participation of the association's members indispensable." Spokane Airports, 103 Wash.App. at 770, 14 P.3d 193 (citing Warth, 422 U.S. at 511, 95 S.Ct. 2197).

Because the rule enunciated by Division One in Ironworkers and many federal courts is judicial and not based on constitutional requirements, we are not required to give it substantial deference. Instead, we find ourselves...