Sch. Dist. No. 1 in the Cnty. of Denver v. Denver Classroom Teachers Ass'n

• Citation: 433 P.3d 38
• Decision Date: 14 January 2019
• Docket Number: Supreme Court Case No. 17SC139
• Parties: SCHOOL DISTRICT NO. 1 IN the COUNTY OF DENVER and State of Colorado and Board of Education of School District No. 1 in the County of Denver and State of Colorado, Petitioners, v. DENVER CLASSROOM TEACHERS ASSOCIATION, Respondent.
• Court: Supreme Court of Colorado

433 P.3d 38

SCHOOL DISTRICT NO. 1 IN the COUNTY OF DENVER and State of Colorado and Board of Education of School District No. 1 in the County of Denver and State of Colorado, Petitioners,

v.DENVER CLASSROOM TEACHERS ASSOCIATION, Respondent.

Supreme Court Case No. 17SC139

Supreme Court of Colorado.

January 14, 2019

Attorneys for Petitioners: Semple, Farrington & Everall, P.C., M. Brent Case, Jonathan P. Fero, Denver, Colorado

Attorney for Respondent: Sharyn E. Dreyer, Denver, Colorado

En Banc

JUSTICE SAMOUR delivered the Opinion of the Court.

¶1 The English Learning Acquisition (ELA) program aims to assist students who have limited English language proficiency. A federal court's Consent Order requires School District No. 1 in Denver and its Board of Education (collectively "the District") to staff teachers who are "fully qualified" to teach English language learners. Starting in the mid-1990s, the District compensated its teachers for ELA training.¹ But the District discontinued that practice after the 2006–07 school year.

¶2 Believing that the decision to stop paying teachers for ELA training violated a series of the parties' Collective Bargaining Agreements (CBAs),² the Denver Classroom Teachers Association (DCTA) pursued a grievance against the District that was referred to nonbinding arbitration and resulted in a recommendation in favor of the DCTA. Because the District declined to adopt that recommendation, however, the DCTA brought this suit asserting a breach-of-contract claim against the District. The trial court ruled that the relevant provisions of the CBAs are ambiguous and that their interpretation was, therefore, an issue of fact for the jury. The jury, in turn, found the District liable for breach of contract and awarded damages to the DCTA. A division of the court of appeals subsequently affirmed the judgment of the trial court. We now affirm the judgment of the court of appeals, albeit on slightly different grounds.

¶3 We conclude that the interpretation of the CBAs was properly submitted as an issue of fact to the jury because the CBAs are ambiguous regarding payment for ELA training. We are mindful that the management rights clause in the CBAs confers to the District broad rights that are constrained only by express terms to the contrary. But because the CBAs are fairly susceptible to being interpreted as expressly requiring compensation for ELA training, we cannot conclude that the management rights clause includes the right to refuse to pay for ELA training. This is not a situation in which the CBAs are silent on the issue of compensation for ELA training. Therefore, we disagree with the District that our decision in City and County of Denver v. Denver Firefighters Local No. 858 (Denver Firefighters ), 2014 CO 15, 320 P.3d 354, is dispositive. Because Denver Firefighters is factually distinguishable, it is of no avail to the District.

I. Facts and Procedural History

¶4 The District is responsible for educating at least 30,000 students whose first language is not English. Under a federal court's Consent Order, the District is required to employ "fully qualified" teachers for these students. The District's teachers must do one of two things to become fully qualified: (1) get a state endorsement to teach English language learners (by obtaining a state-approved master's degree), or (2) complete ELA training within two years of being hired. Beginning in the mid-1990s, the District paid its teachers for ELA training. But in 2008, the District decided it would no longer do so. In lieu of compensation, the District began to offer teachers academic course credit for ELA training.

¶5 Unhappy with this change in policy, the DCTA pursued a grievance. Following nonbinding arbitration proceedings that culminated in a recommendation that was favorable to the DCTA but was rejected by the District, the DCTA brought this suit for breach of contract. Before trial, the District moved for summary judgment. Relying on the management rights clause, the District argued that the CBAs unambiguously establish that it retains the right to refuse to pay for ELA training. The trial court disagreed, concluded that the CBAs are ambiguous, and asked the jury to interpret the pertinent contract provisions. The jury found that the CBAs require payment for ELA training, returned a verdict for the DCTA on the breach-of-contract claim, and awarded the DCTA damages in excess of $1.1 million.

¶6 A division of the court of appeals affirmed, concluding that the jury was properly asked to ascertain the meaning of the relevant contract provisions because the CBAs are ambiguous regarding compensation for ELA training. Denver Classroom Teachers Ass'n v. Sch. Dist. No. 1 in Denver & Colo. (Denver Classroom Teachers ), 2017 COA 2, ¶¶ 13–18, ––– P.3d ––––. The division acknowledged that the CBAs contain a management rights clause, which gives the District control over "[a]ll lawful rights and authority" not expressly addressed in the CBAs. Id. at ¶ 14. It further recognized that ELA training is a posted job requirement and the CBAs are silent on whether the District is required to pay teachers for fulfilling a posted job requirement. Id. at ¶¶ 15–16. But the division observed that the CBAs require "payment for work beyond the forty-hour week, and ... the ELA training may fall into that category." Id. at ¶ 17. Thus, reasoned the division, the CBAs are "fairly susceptible to being interpreted to require payment" for ELA training. Id.

¶7 Notably, the division found unpersuasive the District's reliance on Denver Firefighters :

[I]n that case the supreme court determined that the CBA in question unambiguously gave the city the right to draft and implement the disputed terms. Here, in contrast, we have concluded that the CBAs are ambiguous regarding payment for ELA training. Therefore, although management rights clauses provide expansive rights under certain circumstances, those circumstances are not present in this case.

Id. at ¶ 18. This appeal followed.³

II. Analysis

¶8 The court of appeals determined that, since the provision in the CBAs requiring payment for work beyond the forty-hour week may include ELA training, the CBAs are fairly susceptible to being interpreted as requiring payment for such training. Id. at ¶¶ 16–17. The District contends that the court of appeals improperly narrowed the scope of the holding in Denver Firefighters by giving short shrift to the management rights clause in the CBAs. Relying on the management rights clause, the District urges that it retains the right to refuse to pay for ELA training because the CBAs do not expressly address compensation for the fulfillment of a posted job requirement. We are unpersuaded.

¶9 The CBAs require payment for "Extra Duty," including "In-Service Education," and we conclude that the term "In-Service Education" is fairly susceptible to being interpreted as including ELA training. Therefore, we agree with the court of appeals that the trial court properly submitted the interpretation of the pertinent contract provisions to the jury.⁴

¶10 In addressing the merits of the District's position, we analyze the relevant provisions of the CBAs and review our decision in Denver Firefighters . Before doing so, though, we take a moment to set forth the standard of review that governs this appeal and the tenets of contract interpretation that guide our decision.

A. Standard of Review

¶11 The interpretation of a contract presents a question of law. Laleh v. Johnson , 2017 CO 93, ¶ 18, 403 P.3d 207, 211. Therefore, we review the judgment of the court of appeals de novo. Denver Firefighters , ¶ 7, 320 P.3d at 357.

B. Tenets of Contract Interpretation

¶12 Our primary goal when we interpret a contract is to discern and effectuate the parties' intent. Rocky Mountain Exploration, Inc. v. Davis Graham & Stubbs LLP , 2018 CO 54, ¶ 59, 420 P.3d 223, 235. "We ascertain the parties' intent ‘primarily from the language of the instrument itself.’ " Id. (quoting Ad Two, Inc. v. City & Cty. of Denver , 9 P.3d 373, 376 (Colo. 2000) ).

¶13 In determining whether certain provisions of a contract are ambiguous, we focus on the words employed and construe any undefined words "in harmony with the[ir] plain and generally accepted meaning ... and by reference to all the parts and provisions of the agreement and the nature of the transaction which forms its subject matter." Cheyenne Mountain Sch. Dist. No. 12 v. Thompson , 861 P.2d 711, 715 (Colo. 1993). We may consult definitions in recognized dictionaries to give undefined words their plain and generally accepted meaning. Renfandt v. N.Y. Life Ins. Co. , 2018 CO 49, ¶ 18, 419 P.3d 576, 580.

¶14 If the contract is complete and free from ambiguity, we deem it to represent the parties' intent and enforce it based on the plain and generally accepted meaning of the words used. Rocky Mountain , ¶ 59, 420 P.3d at 235. But "if it is fairly susceptible to more than one interpretation," the contract is ambiguous and "the meaning of its terms is generally an issue of fact to be determined in the same manner as other disputed factual issues." Dorman v. Petrol Aspen, Inc. , 914 P.2d 909, 912 (Colo. 1996) (quoting Fibreglas Fabricators, Inc. v. Kylberg , 799 P.2d 371, 374 (Colo. 1990) and Union Rural Elec. Ass'n v. Public Utils. Comm'n , 661 P.2d 247, 251 n.5 (Colo. 1983) ).

C. Relevant Contract Provisions and Denver Firefighters

¶15 Article 2-7 of the CBAs recognizes that the District has the "authority to establish policies and regulations for the management of all the operations and activities of the District." This acknowledgement is followed by a management rights clause: "All lawful rights and authority of the [District] not modified by [the CBAs] are retained by the [District]." The District places considerable stock in this clause.

¶16 We construed a management rights clause in a collective bargaining agreement in Denver Firefighters .⁵ There, we explained that the management rights...