The Association v. City of Portland

• Decision Date: 24 April 2002
• Parties: PORTLAND FIRE FIGHTERS' ASSOCIATION, LOCAL 43, Petitioner, v. CITY OF PORTLAND, Respondent.
• Court: Oregon Court of Appeals

45 P.3d 162

181 Or. App. 85

PORTLAND FIRE FIGHTERS' ASSOCIATION, LOCAL 43, Petitioner, v. CITY OF PORTLAND, Respondent.

UP-58-99; A111627.

Court of Appeals of Oregon, En Banc.

Argued and Submitted July 9, 2001.

Resubmitted February 6, 2002.

Decided April 24, 2002.

Monica A. Smith argued the cause for petitioner. On the brief were Robert Reid and Reid & Bates.

Rudolph S. Westerband argued the cause and filed the brief for respondent.

Before DEITS, Chief Judge, EDMONDS, LANDAU, HASELTON, ARMSTRONG, LINDER, WOLLHEIM, KISTLER, BREWER, and SCHUMAN, Judges.

Resubmitted En Banc February 6, 2002.

BREWER, J.

Petitioner, Portland Fire Fighters' Association, Local 43 (the Association), seeks judicial review of a final order of the Employment Relations Board (ERB). In that order, ERB dismissed the Association's complaint, alleging that the City of Portland (the city) violated ORS 243.672(1)(g) by refusing to arbitrate a grievance concerning retiree health insurance benefits.¹ We review ERB's factual findings for substantial evidence and its legal conclusions for errors of law. ORS 183.482(8); Lane Unified Bargaining v. South Lane Sch. Dist., 169 Or. App. 280, 282, 9 P.3d 130 (2000), rev. allowed 331 Or. 692, 26 P.3d 148 (2001). Because ERB erroneously concluded that the parties' collective bargaining agreement (CBA) does not authorize the Association to file a "retiree grievance" and have that grievance ultimately arbitrated, we reverse and remand.

The parties stipulated to the following facts before ERB:

"1. [The Association] is the exclusive representative of a bargaining unit of employees employed by [the city], a public employer;

"2. The Association and [the city] are parties to a[CBA] effective July 1, 1996 through June 30, 1999. (Joint Exhibit 1; [CBA]);

"3. On February 23, 1999, the Association filed a grievance with [the city]. (Joint Exhibit 2; grievance);

"4. By letter dated March 22, 1999, [the city] denied the grievance. (Joint Exhibit 3; March 22, 1999 letter from Wall to Chamberlain);

"5. The parties have a good faith dispute as to whether this retiree grievance is substantively arbitrable, in light of the Board's decision in McMinnville Education Association v. McMinnville School District # 40, Case No. UP-78-94, 16 PECBR 107 (1995). Therefore, [the city] `declines' to arbitrate the matter and the Association is pursuing this `friendly' refusal to arbitrate unfair labor practice. (Joint Exhibit 4; June 30, 1999 letter from Colombo to Reid & Joint Exhibit 5; July 1, 1999 Reid response to Colombo);

"6. The representatives signing this stipulation: (a) warrant that they are authorized by their respective principals to do so; (b) represent that the above statements are accurate and constitute all of the evidence that either party desires to present to the Board in this matter; (c) waive formal service of the complaint; (d) waive review of Administrative Procedure Act rights (ORS 183.413); and (e) waive a hearing on the facts to be considered by the Board."

The parties submitted the stipulation, together with Joint Exhibits 1-5, to ERB, and both parties waived a hearing.

The grievance filed by the Association alleged that the city had violated the CBA by requiring retired employees and their spouses to pay higher health-care premiums than the city paid for active employees.² The grievance form used by the Association described the dispute as "[t]he specific terms of the contract are violated by requiring a retiree or retiree's spouse to pay higher health benefit premiums than the rate charged for active employees[.]" The grievance requested as relief that the city "provide remuneration to retirees or retiree's spouses for any premiums paid in violation of the contract" and that the city "follow [the] contract's terms as to retiree and survivor benefits, prospectively."

The procedure under which the Association filed the grievance is detailed in Article 14 of the CBA. Because it is central to our analysis, we set out Article 14 in full:

"Section 1. General. To promote better employer-employee relationships, both parties pledge their immediate cooperation to settle any grievance or complaints that might arise out of the application of this Agreement and the following procedure shall be the sole procedure to be utilized for that purpose. Any settlement of a grievance under this Article, which would alter or amend the terms of this agreement or any side bar agreement or memorandum of understanding shall not be binding on either party unless the settlement, or memorandum of understanding or a side bar agreement, is approved in writing by the president of the Association and the Director of the Bureau of Personnel. Facts and practices that occurred prior to October 28, 1994 shall not be relevant nor used as a basis for any grievance raised by any Fire Battalion Chief.

"Section 2. Process.

"Step 1. The aggrieved employee or the Association, with or without the employee, may take up the grievance or dispute with the employee's supervisor outside the bargaining unit within five (5) working days of its occurrence.

"Step 2. If the matter is not settled within ten (10) working days of reference to the supervisor, the matter shall be reduced to writing, including but not limited to the nature of the grievance, the section of the contract allegedly violated, specifically how the contract has been violated, and any requested action, and presented to the Chief within ten (10) working days of the expiration of the ten (10) working-day period for settlement with the supervisor.

"Step 3. If the matter is not settled within ten (10) working days of receipt by the Chief, the Association shall have the right to submit the grievance in writing to the Personnel Director within ten (10) working days of the expiration of the ten (10) working-day period for settlement with the Bureau Head. The Personnel Director shall make a recommendation to the Commissioner in charge.

"Step 4. Should the parties fail to settle the dispute at the level of the Personnel Director and Commissioner in charge within two (2) weeks from the date of submission to the Personnel Director, the Association shall have the right to submit the matter to arbitration. In the event the Association elects to do so, it must notify the Personnel Director of its decision in writing within ten (10) working days from the date upon which the two (2) week period ends. After the grievance has been so submitted, the parties or their representatives shall jointly request the Employment Relations Board for a list of names of seven (7) arbitrators. The parties shall select an arbitrator from that list by such method as they may jointly select, or if they are unable to agree upon a method, then by the method of alternate striking of names under which the grieving party shall strike the first name objectionable to it, and the Employer shall then strike the first name objectionable to it. The final name left on the list shall be the arbitrator.

"The arbitrator's decision shall be final and binding on both parties, but the arbitrator shall have no power to alter in any way the terms of this agreement. The decision of the arbitrator shall be within the scope and terms of this agreement and the arbitrator shall be requested to issue the decision in writing, indicating findings of fact and conclusion, to both parties within thirty (30) days after the conclusion of the proceedings, including filing of briefs, if any. It may also provide retroactivity not exceeding sixty (60) days prior to the date the grievance was filed and shall state the effective date.

"Expenses for the arbitrator's services and the proceedings shall be borne by each party in equal share. However, each party shall be responsible for any other expenses incurred by them.

"The parties agree that the grievance procedure is the exclusive remedy for disputes regarding issues covered by the bargaining agreement. As such, the parties agree not to represent or support actions by employees, outside of the grievance procedure, on issues covered by the bargaining agreement. This does not prohibit the Union from using any outside process, as provided by ORS 243.650 to 243.782, for enforcement of the contractual grievance procedure."

After the city denied the grievance, the Association sought to submit the dispute to arbitration under Step 4 of the dispute resolution procedure. The city declined to arbitrate the dispute. The Association then filed an unfair labor practice complaint with ERB, alleging that the city had violated the CBA by refusing to submit the grievance to arbitration.³ After a hearing, the hearing officer issued recommended findings of fact, conclusions of law, and a proposed order, concluding that the city had committed an unfair labor practice by improperly refusing to arbitrate the grievance. In a split decision, ERB reversed the hearing officer's proposed order. The Association seeks review of ERB's final order dismissing the complaint. The decisive issue on review—as it was before ERB—is whether the CBA permits the Association to compel the city to arbitrate disputes concerning retiree health insurance benefits.

CBAs generally are interpreted in the same manner as are other contracts. OSEA v. Rainier School Dist. No. 13, 311 Or. 188, 194, 808 P.2d 83 (1991). To interpret disputed contract provisions, we first examine "the text of the disputed provision, in the context of the document as a whole." Yogman v. Parrott, 325 Or. 358, 361, 937 P.2d 1019 (1997). "Unambiguous contracts must be enforced according to their terms." Rainier School Dist. No. 13,311 Or. at 194,808 P.2d 83. A contract is ambiguous if it can reasonably be given more than one plausible interpretation. See North Pacific Ins. Co. v. Hamilton, 332 Or. 20, 25, 22 P.3d 739 (2001)

. Where provisions of a contract are mutually inconsistent, the contract is ambiguous as to the subject matter of those provisions. See Miller v. Miller, ...