Klein v. State

• Decision Date: 29 May 2008
• Docket Number: No. DA 06-0256.,DA 06-0256.
• Citation: 185 P.3d 986,2008 MT 189
• Parties: Rebekah KLEIN, Plaintiff and Appellant, v. The STATE of Montana, by and through its MONTANA DEPARTMENT OF CORRECTIONS, Defendant and Appellee.
• Court: Montana Supreme Court

185 P.3d 986

2008 MT 189

Rebekah KLEIN, Plaintiff and Appellant, v. The STATE of Montana, by and through its MONTANA DEPARTMENT OF CORRECTIONS, Defendant and Appellee.

No. DA 06-0256.

Supreme Court of Montana.

Argued April 4, 2007.

Submitted April 17, 2007.

Decided May 29, 2008.

For Appellant: Tom W. Stonecipher (argued), Bridget White leFeber, Tarlow Stonecipher & Steele, PLLC, Bozeman, Montana.

For Appellee: Michael Richard King (argued), Special Assistant Attorney General, Helena, Montana.

For Amicus MEA-MFT, Montana Trial Lawyers Association, Montana AFL-CIO, Teamsters Union, Local 190, AFSME Montana State Council No. 9, Montana Nurses Association, Montana Public Employees Association, International Union of Operating Engineers, Local 400, International Brotherhood of Electrical Workers, Local 233: Karl J. Englund, Karl J. Englund, P.C., Missoula Montana, Stephen C. Bullock, Bullock Law Firm, Helena, Montana.

For Amicus Montana Defense Trial Lawyers Association: Jeff M. Hindoien, Gough, Shanahan, Johnson & Waterman, Helena, Montana.

For Amicus Montana League of Cities and Towns and Montana Association of Counties: Oliver H. Goe, Chad E. Adams, Browning, Kaleczyc, Berry & Hoven, P.C., Helena, Montana.

Justice PATRICIA O. COTTER delivered the Opinion of the Court.

¶ 1 Appellant Rebekah Klein (Klein) appeals a grant of summary judgment in favor of the state of Montana, by and through its Montana Department of Corrections (DOC) in the First Judicial District Court, Lewis and Clark County. We affirm in part, reverse in part and remand for further proceedings consistent with this Opinion.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 2 Klein is a member of the Montana Federation of Probation and Parole, Local No. 4464 (Union), and a probation and parole officer with the DOC in Bozeman, Montana. Klein signed a collective bargaining agreement (CBA) with the DOC prior to her employment. In its preamble, the CBA describes itself as "a basic and complete agreement between the parties concerning terms and conditions of employment which are not otherwise mandated by statute." As such the CBA covers a wide range of issues pertaining to employment with the DOC, including a grievance procedure involving the use of arbitration for resolving disputes between the DOC and Union members.

¶ 3 On April 14, 2003, Klein was suspended with pay from her position due to allegations she had revealed confidential information about an on-going investigation of a Bozeman police officer to the police officer who was himself the target of the investigation. On April 17, 2003, Klein and a Union representative met with a human resource officer and criminal investigator from the DOC to discuss the matter. Klein alleges that DOC officials misrepresented to her the nature of this meeting, stating it was merely to discuss a "personnel matter" and that information divulged in the meeting would not be used in a criminal investigation against her. However, Klein alleges that DOC officials turned over information gleaned from the meeting to the Gallatin County Attorney, who then unsuccessfully attempted to prosecute Klein for official misconduct. According to Klein, during this meeting DOC officials never provided Klein with any warnings, or indicated they intended to use this information to bring a criminal prosecution against her.

¶ 4 On May 7, 2003, after conducting an investigation into Klein's alleged misconduct, officials from the DOC held a hearing on the matter. Prior to this hearing, DOC officials informed the Bozeman Daily Chronicle that an investigation had been conducted concerning an adult probation officer on leave with the DOC, and that the results of that investigation would be turned over to the Gallatin County Attorney. The Chronicle in turn reported this information. According to Klein, she and her Union representatives requested a copy of the investigative report prior to the hearing, but their requests were initially denied. They were later given copies of this report at the May 7 hearing.

¶ 5 On May 27, 2003, the DOC informed Klein by letter that her employment with the DOC was terminated. Among the stated reasons for the discharge was the existence of substantial evidence, based on the hearing and related investigation, that Klein had obstructed and interfered with the investigation of the Bozeman police officer. On June 3, 2003, Klein filed a grievance with the DOC, stating that she was fired without just cause and seeking to be made whole by receiving her former position, back pay and benefits. Her grievance was arbitrated, with a decision in her favor handed down on May 12, 2005. The arbitrator found that Klein was not fired for just cause and directed DOC to reinstate her and take appropriate measures to make her whole for the losses she had occasioned.

¶ 6 Prior to the entry of the arbitrator's final decision, Klein filed suit against the DOC on January 6, 2005, in Lewis and Clark County District Court. Her Complaint against DOC contained four separate counts. Count I claimed a violation of due process, while Counts II through IV sounded in tort. The State moved for summary judgment on all four counts. The District Court held oral argument on January 26, 2006, ultimately granting the State's motion and dismissing Klein's suit. The District Court concluded that the terms of the CBA and the authority set forth in Small v. McRae, 200 Mont. 497, 651 P.2d 982 (1982), MacKay v. State of Mont. Bd. of Regents, 2003 MT 274, 317 Mont. 467, 79 P.3d 236, and Buckhorn v. St. Jude Heritage Medical Group, 121 Cal. App.4th 1401, 18 Cal.Rptr.3d 215 (4 Dist. 2004), required that Klein exhaust her remedies through arbitration, and prohibited her from litigating her dispute with the DOC because she had failed to exhaust those remedies. As stated in the District Court's order:

The language of the collective bargaining agreement states that it is the intent of the agreement to set forth [a] "complete agreement between the parties concerning terms and conditions of employment which are not otherwise mandated by statute." Further, the parties agree that they will arbitrate "all disputes arising between them involving questions of interpretation or application of the provisions of this agreement." In the view of this Court, the combination of the just quoted provisions of the collective bargaining agreement dictate that these particular causes of action currently filed by Klein against the State must be arbitrated. The collective bargaining agreement indicates that it is setting forth a complete agreement between the parties concerning the terms and conditions of employment.

....

In light of the discretion this Court has been given to resolve any doubt in favor of arbitration, this Court must hold that the State's motion should be granted. Klein has failed to exhaust her collective bargaining grievance procedures. As such, she cannot be allowed to sidestep those procedures and bring this action.

¶ 7 Klein appeals this grant of summary judgment. She asserts the District Court erred in concluding that the terms of the CBA applied to her claims and required her to grieve the claims and exhaust her remedies under the CBA. Klein maintains the terms of the CBA are unambiguous and allow her to litigate her claims in District Court. She asks this Court to reverse the grant of summary judgment and reinstate those claims. The State opposes Klein and urges us to affirm the District Court. The State contends all the facts furnishing a basis for her Complaint arose from the DOC's investigation and resulting discharge, and were adequately covered by the grievance process provided for in the CBA. The State argues Klein pursued her grievance through the appropriate process, obtained reinstatement with back pay and benefits, and "cannot now completely sidestep the process which produced those results and sue in district court for more money." Klein's appeal before this Court is timely.

ISSUES

¶ 8 We state the sole issue on appeal as follows: Did the District Court err in concluding the CBA prevented Klein from litigating her claims in District Court?

STANDARD OF REVIEW

¶ 9 We review grants of summary judgment de novo using the same criteria as the district court under M.R. Civ. P. 56. Hogenson Const. of N.D. v. Mont. State Fund, 2007 MT 267, ¶ 11, 339 Mont. 389, ¶ 11, 170 P.3d 471, ¶ 11. In reviewing the district court's decision, "[w]e must determine whether the district court correctly applied the law." Hogenson, ¶ 11.

DISCUSSION

¶ 10 Our main task in resolving the current appeal is to determine whether the District Court correctly concluded that the CBA covered all four counts in Klein's Complaint, thus requiring her to exhaust her remedies through mechanisms provided in the CBA. Resolving this question involves a consideration of both the terms of the CBA, and the specific allegations in Klein's Complaint.

¶ 11 Generally speaking, grievance procedures provided for in a collective bargaining agreement must be exhausted in the course of resolving disputes between employers and employees. MacKay, ¶ 24. There is a well-established policy in favor of resolving labor disputes under the terms of a collective bargaining agreement when such an agreement is present. Small, 200 Mont. at 503-04, 651 P.2d at 986; MacKay, ¶ 25. However, there is a narrow exception to this general principle. "Only in those cases where it is certain that the arbitration clause contained in a collective bargaining agreement is not susceptible to an interpretation that covers the dispute is an employee entitled to sidestep the provisions of the collective bargaining agreement." Small, 200 Mont. at 504, 651 P.2d at 986. Moreover, collective bargaining agreements do not always preclude employees covered under their terms from pursuing independent causes of action. See Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 571, 96 S.Ct. 1048, 1059-60, 47 L.Ed.2d 231 (1976) (finding...