N.C. Ass'n of Educators, Inc. v. State

• Citation: 368 N.C. 777,786 S.E.2d 255
• Decision Date: 15 April 2016
• Docket Number: No. 228A15.,228A15.
• Parties: NORTH CAROLINA ASSOCIATION OF EDUCATORS, INC., Richard J. Nixon, Rhonda Holmes, Brian Link, Annette Beatty, Stephanie Wallace, and John Deville v. The STATE of North Carolina.
• Court: United States State Supreme Court of North Carolina

368 N.C. 777

786 S.E.2d 255

NORTH CAROLINA ASSOCIATION OF EDUCATORS, INC., Richard J. Nixon, Rhonda Holmes, Brian Link, Annette Beatty, Stephanie Wallace, and John Deville

v.The STATE of North Carolina.

No. 228A15.

Supreme Court of North Carolina.

April 15, 2016.

Patterson Harkavy LLP, by Burton Craige, Raleigh and Narendra K. Ghosh ; Chapel Hill, and National Education Association, Washington, by Philip Hostak, pro hac vice, for plaintiff-appellees.

Roy Cooper, Attorney General, by John F. Maddrey, Solicitor General; Melissa L. Trippe, Special Deputy Attorney General; and Elizabeth A. Fisher, Assistant Solicitor General, for defendant-appellant.

Gray Layton Kersh Solomon Furr & Smith, PA, Gastonia, by Michael L. Carpenter, for North Carolina Retired Governmental Employees' Association, amicus curiae.

McGuinness Law Firm, Elizabethtown, by J. Michael McGuinness, for Southern States Police Benevolent Association and North Carolina Police Benevolent Association, amici curiae.

Blanchard, Miller, Lewis & Isley, P.A., Raleigh, by E. Hardy Lewis, for State Employees Association of North Carolina, Inc., amicus curiae.

EDMUNDS, Justice.

The North Carolina Constitution provides that "[t]he people have a right to the privilege of education, and it is the duty of the State to guard and maintain that right." N.C. Const. art. I, § 15. Until 2013, North Carolina public school teachers were employed under a system usually described generically as the "Career Status Law," through which teachers could earn career status after successfully completing a probationary period and receiving a favorable vote from their school board. N.C.G.S. § 115C–325 (2012). That process changed with passage of the Current Operations and Capital Improvements Appropriations Act of 2013, ch. 360, 2013 N.C. Sess. Laws 995 ("the Act"). Details of the Act are described below, but most pertinent to the case at bar, the Act retroactively revoked the career status of teachers who had already earned that designation by repealing the Career Status Law ("Career Status Repeal"), id., sec. 9.6(a), at 1091, and created a new system of employment for public school teachers, id., secs. 9.6(b) to 9.7(y), at 1091–1116 (hereinafter sections 9.6 and 9.7).

Plaintiffs allege that sections 9.6 and 9.7 of the Act violate Article I, Section 10 of the United States Constitution (forbidding passage of any "Law impairing the Obligation of Contracts") and Article I, Section 19 of the North Carolina Constitution (the Law of the Land Clause), as it applied to teachers who have previously earned career status. We conclude that repeal of the Career Status Law unlawfully infringes upon the contract rights of those teachers who had already achieved career status. As a result, we hold that sections 9.6 and 9.7 are unconstitutional, though only to the extent that the Act retroactively applies to teachers who had attained career status as of 26 July 2013.

We begin our analysis with an overview of the evolution of state statutes that have controlled career status of public school teachers. For over four decades, North Carolina public schools have operated under what was commonly called the Career Status Law, a statutory framework setting out a system for the employment, retention, and dismissal of public school teachers. However, little in this framework has remained static over the years.

Beginning in 1971, the General Assembly created a procedure through which teachers who were employed for at least three consecutive years as probationers would become "career teachers" if the school board voted to reemploy the teacher for the upcoming school year. See Act of July 16, 1971, ch. 883, 1971 N.C. Sess. Laws 1396 (codified at N.C.G.S. § 115–142 (1971)). In addition, any teacher who had been employed in the same public school system for four consecutive years or been employed by the State as a teacher for five consecutive years would automatically became a career teacher. N.C.G.S. § 115–142(c). These career teachers were no longer subject to an annual appointment process, id. § 115–142(d), and could only be dismissed for one of twelve grounds specified in the statute, id. § 115–142(e)(1). If a teacher was to be dismissed, the act provided for notice and, if requested by the teacher, a review of the recommendation of dismissal by a panel of the Professional Review Committee prior to termination. Id. § 115–142(h). A local school board could choose not to renew its contract with a probationary teacher for any reason that was not "arbitrary, capricious, discriminatory or for personal or political reasons." Id. § 115–142(m)(2).

The system originally set up in 1971 has been subject to continual tinkering and revision by the General Assembly. In 1973, the General Assembly added a thirteenth statutory ground for dismissal of a teacher, id. § 115–142(e)(1)m (1975), and gave disappointed teachers the option of requesting either a review of a superintendent's dismissal recommendation by a panel of the Professional Review Committee or a hearing before the school board, id. § 115–142(h)(3) (1975). See Act of May 23, 1973, ch. 782, secs. 12, 20, 1973 N.C. Sess. Laws 1136, 1138, 1139 (codified at N.C.G.S. § 115–142 (1975)). In 1979, a fourteenth statutory ground for dismissal or demotion was added. See Act of June 8, 1979, ch. 864, sec. 2, 1979 N.C. Sess. Laws 1185, 1188 (codified at N.C.G.S. § 115–142(e)(1)n (1979)).

The next significant change came in the 1983 legislative session. The General Assembly amended the 1979 law to provide that, after a teacher had taught for three, four, or five consecutive years in a school system with more than 70,000 students, the local school board had authority to grant the teacher career status, reappoint the teacher to another probationary one-year contract, or decline to reappoint the teacher. See Act of May 26, 1983, ch. 394, 1983 N.C. Sess. Laws 301 (codified at N.C.G.S. § 115C–325(c)(1) (1985) ). At the end of the probationary teacher's sixth year, the school board's choices were limited to appointment to career teacher status or nonrenewal of the appointment. N.C.G.S. § 115C–325(c)(1). However, the General Assembly did not extend this program, so after 1 July 1985 the process through which teachers received career status reverted to the 1981 system. See Ch. 394, sec. 6, 1983 N.C. Sess. Laws at 302. In 1992, a new statutory ground for dismissal was added, along with an amendment allowing a teacher who was being considered for dismissal to request a hearing either before the local school board or before a panel of the Professional Review Committee (instead of the previously provided investigation of the superintendent's recommendation by the Professional Review Committee). See Act of July 14, 1992, ch. 942, 1991 N.C. Sess. Laws (Reg. Sess. 1992) 730 (codified at N.C.G.S. § 115C–325(e) – (j) (1992) ). Under either option, the hearing procedure was set out in subsection 115C–325(j). N.C.G.S. § 115C–325(e)(2), (h)(3), (i)(2) (1992).

In 1997, the General Assembly enacted a comprehensive set of statutes that included measures aimed at improving student academic achievement, enhancing teacher skills and knowledge, and implementing a system to review more rigorous teacher preparation, professional development, and certification standards. See The Excellent Schools Act, ch. 221, 1997 N.C. Sess. Laws 427. The new law enacted, amended, or repealed many provisions related to education and included significant changes to section 115C–325. For example, the act increased from three to four the number of years of consecutive service a teacher had to complete before becoming eligible for career status. See N.C.G.S. § 115C–325(c)(1) (1997). This act also expanded the definition of "demote" to include some circumstances under which a career teacher was suspended without pay and excluded circumstances where bonus payments were reduced or eliminated. Id. § 115C–325(a)(4) (1997). The Professional Review Committee system was eliminated and replaced with case managers who were certified mediators specially trained by the State Board of Education. Id. § 115C–325(h) – (h1) (1997). Career employees being recommended for dismissal or demotion had the option of choosing between a hearing in front of a case manager, governed by subsection 115C–325(j), or a hearing in front of the school board, conducted pursuant to subsection 115C–325(j2). Id. § 115C–325(h)(3) (1997). In 2009, the legislature amended the statute to add procedural protections for probationary teachers. See Act of July 13, 2009, ch. 326, 2009 N.C. Sess. Laws 528 (codified at N.C.G.S. § 115C–325(m)(3)–(4) (2009) ).

In 2011, the legislature eliminated case managers and replaced them with hearing officers before whom career status teachers could request a hearing prior to dismissal or demotion. See Act of June 17, 2011, ch. 348, sec. 1, 2011 N.C. Sess. Laws 1464, 1464 (codified at N.C.G.S. § 115C–325(a)(4c), (h)(3), (h1) (2011) ). The act also provided a definition for "inadequate performance," one of the original statutory grounds for dismissal or demotion of a career employee. N.C.G.S. § 115C–325(e)(3) (2011).

The employment system in place at the time of the passage of the Act was codified under N.C.G.S. § 115C–325 (2012) and established two classes of public school teachers. Probationary teachers were defined in N.C.G.S. § 115C–325(a)(5), while career teachers were defined in N.C.G.S. § 115C–325(a)(1c). Probationary teachers were employed through annual contracts with the local board of education. Id. § 115C–325(m)(2). These contracts were subject to nonrenewal for any reason that was not "arbitrary, capricious, discriminatory or for personal or political reasons." Id. The school board would vote on whether to grant career status to a probationary teacher who had been employed by that school system for four consecutive years. Id. § 115C–325(c)(1). Probationary teachers eligible for such a vote had the right to notice and a hearing...