Papadakis v. Iowa State University of Science and Technology

• Decision Date: 18 February 1997
• Docket Number: No. 96-1001,96-1001
• Citation: 574 N.W.2d 258
• Parties: 124 Ed. Law Rep. 375 Emmanuel P. PAPADAKIS, Appellant, v. IOWA STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY and Iowa State Board of Regents, Appellees, and Donald O. Thompson, Defendant.
• Court: Iowa Supreme Court

Page 258

574 N.W.2d 258

124 Ed. Law Rep. 375

Emmanuel P. PAPADAKIS, Appellant, v. IOWA STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY and Iowa State Board of Regents, Appellees and Donald O. Thompson, Defendant.

No. 96-1001.

Supreme Court of Iowa.

Feb. 18, 1997.

James L. Sayre of James L. Sayre, P.C., Des Moines, for appellant.

Thomas J. Miller, Attorney General, Diane Stahle, Special Assistant Attorney General, and Cecelia C. Ibson, Assistant Attorney General, for appellees.

Considered by McGIVERIN, C.J., and CARTER, LAVORATO, NEUMAN, and ANDREASEN, JJ.

CARTER, Justice.

Emmanuel P. Papadakis, a faculty member at Iowa State University, appeals from the district court's ruling that his contract dispute with the university must be resolved through the administrative and judicial review procedures of Iowa Code chapter 17A (1995) and may not be made the subject of a declaratory judgment action under Iowa Rule of Civil Procedure 262. The court of appeals affirmed the district court. We granted further review of that decision and, after considering the arguments presented, affirm the decision of the court of appeals and the judgment of the district court.

Appellant was employed as a research scientist working for the Center for Nondestructive Evaluation (CNDE), a part of the Institute for Physical Research and Technology (IPRT), at Iowa State University. He was appointed to this position on November 30, 1987. The written letter of appointment embodying the terms of his employment showed on its face a period of three years from July 1, 1987, to June 30, 1990. The letter of appointment specified, however, that appellant would in fact have a three-year rolling tenure, so that his employment would be continuous subject to three years' notice of termination. A second letter of appointment concerning appellant's employment was issued in August of 1990. It specified a period from July 1, 1990, to June 30, 1993, but provided for a continuation of appellant's rolling tenure terminable by three years' notice of termination.

On May 8, 1992, the director of the CNDE sent the following communication to appellant:

As was indicated to you during last year's evaluation process and delineated in Jerry Jenison's memo dated July 8, 1991, there is a great deal of importance placed on researchers generating outside support for their work since funding from state appropriations is clearly not guaranteed. Because of this uncertainty in funding, it is not in the best interest of the Center for Nondestructive Evaluation (CNDE), or the Institute for Physical Research and Technology (IPRT) to commit to appointments for any substantial period of time. Thus, CNDE is officially terminating your "rolling tenure" appointment, which is the only remaining appointment as such in IPRT, and I will not extend such offers in the future. Accordingly, your current appointment with the three year rolling tenure will be terminated effective May 31, 1995. Subject to continuing funding levels, your position will be maintained at its current level until that date. Any appointment beyond the 1995 date will be determined at some point in the future.

The dispute involved in the present litigation arose from a purported letter of appointment issued to appellant after the May 8, 1992 letter.

In January of 1993 a letter of appointment was issued, which, on its face, covered the period from January 1, 1993, to June 30, 1996. The language establishing a three-year rolling tenure that had been included in appellant's prior letters of appointment was not contained in the January 1993 document. Appearing in that document after the termination date of June 30, 1996, was an asterisk, and below this the following language appeared.

*The appointment is contingent on continued appointment by Center for NDE (IPRT). Rank only in EECpE Dept. the conditions and duration of the salaried obligations per existing agreements between Dr. Papadakis and Ames Lab/IPRT. All salary to be paid by Ames Lab/IPRT.

On May 31, 1995, the university ceased to pay appellant's salary and canceled all employment benefits. It based this action on the May 8, 1992 letter of termination. Appellant contends that his contract of employment extended beyond May 31, 1995. He sought a declaratory judgment to that effect in Count II and Count III of a petition at law filed against Iowa State University and the Iowa State Board of Regents. In Count IV of that petition, he asserted a claim for damages for an alleged breach of his employment contract by the university and the board. ¹

The appellees moved to dismiss all of the contract claims against them on the ground that the subject matter of those claims involved agency action as defined in Iowa Code section 17A.2(2) and, as such, could only be brought before a court by means of the statutory procedures for reviewing agency action contained in section 17A.19. The district court sustained this challenge on the grounds urged in appellees' motion and dismissed Counts II, III, and IV. The court of appeals affirmed the judgment of the district court.

We granted further review of the court of appeals decision to consider whether there is in fact a statutory mandate committing all disputes over the terms of employment contracts of state employees to an administrative adjudication process reviewable only under the procedures established in section 17A.19. We have previously answered that question in the affirmative with respect to issues involving the withholding of faculty tenure by a state university. See Genetzky v. Iowa State Univ., 480 N.W.2d 858, 861 (Iowa 1992); Black v. University of Iowa, 362 N.W.2d 459, 462 (Iowa 1985); Allegre v. State Bd. of Regents, 319 N.W.2d 206, 209 (Iowa 1982). Tenure decisions, however, relate much more directly to issues of academic qualification within the expertise of the Board of Regents than do the issues in the present case. At issue here is the interpretation of employee rights under an express contract.

State agencies must necessarily contract with members of the public to obtain needed goods and services. We have recognized that the state is legally responsible for its contractual obligations in an action to enforce such agreements. See Kersten Co. v. Department of Soc. Servs., 207 N.W.2d 117, 122 (Iowa 1973) (state by entering into contract agrees to be answerable for its breach and waives its immunity from suit to that extent). We do not believe that it was the intent of the legislature in enacting chapter 17A to relegate all contractual claims against the state to an administrative determination. Our recent decision in Hornby v. State, 559 N.W.2d 23, 25 (Iowa 1997), in which we held that a dispute over benefits owed a retired employee of a state university could be pursued as an ordinary breach-of-contract action, appears to negate that portion of our holding in Allegre dealing with benefits due retired and former employees of a state university.

As a result of this conclusion, we now disapprove the suggestion made in Allegre, 319 N.W.2d at 209, that any action or inaction by an agency, as defined in section 17A.2(1) and (2) is reviewable only under the procedures of chapter 17A. In order for this to be the case,...