Town of Johnston v. Int'l Ass'n of Firefighters, C.A. No. PM-2012-3370

• Decision Date: 26 June 2013
• Docket Number: C.A. No. PM-2012-3370
• Parties: TOWN OF JOHNSTON v. INTERNATIONAL ASSOCIATION OF FIREFIGHTERS, LOCAL 1950, AFL-CIO, by and through its President, KEITH A. CALCI
• Court: Rhode Island Superior Court

TOWN OF JOHNSTON

v. INTERNATIONAL ASSOCIATION OF FIREFIGHTERS, LOCAL 1950,AFL-CIO, by and through its President, KEITH A. CALCI

C.A. No. PM-2012-3370

STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS PROVIDENCE, SC. SUPERIOR COURT

FILED: June 26, 2013

DECISION

CARNES, J. Before this Court are Plaintiff Town of Johnston's (Town) Motion to Vacate and Defendant International Association of Firefighters, Local 1950's (Union) Cross-Motion to Confirm an arbitration award issued on June 21, 2012. The Town has also moved to stay implementation of the award. Jurisdiction is pursuant to G.L. 1956 §§ 28-9-17 and 28-9-18.

IFacts and Travel

The Town and the Union are parties to a collective bargaining agreement (CBA) that became effective July 1, 2009 and expired June 30, 2012. See CBA, Town's Compl., Ex. 1. The CBA was entered into pursuant to the Firefighter's Arbitration Act, §§ 28-9.1 et seq. (FFAA). Article XX of the CBA addresses the retirement benefits and pension rights of currently employed firefighters who were hired prior to July 1, 1999.¹ See Art. XX, § 1, CBA. Sections 1.1 through 1.12 of Article XX cover, inter alia, service requirements, maximum and minimum benefits, contribution rates, purchases of credit, and calculation of and eligibility fordisability benefits. See Art. XX, CBA. The CBA also contains a procedure for resolution of any alleged grievances of either party that may arise "with respect to wages, rates of pay or other terms and conditions of employment arising under [the CBA] or in connection with the interpretation thereof[.]" Art. XIV, CBA. Disputes that are not resolved through the grievance procedure are referred for final and binding arbitration. See Art. XIV, § 1(D), CBA.

On February 17, 2011, the Johnston Town Council adopted Ordinance 2011-1 (Ordinance), amending Article VII, Chapter 47 of the Town of Johnston Code of Ordinances, and establishing the "Town of Johnston Fire Fighter and Police Officer Pension Fund" (Fund). See Ord. §§ 47-38 - 47-61.² The Fund was created "for the purpose of providing retirement pension benefits, survivors' benefits and other benefits for firefighters and police officers of the Town, pursuant to the provisions of the applicable state law and the Town Charter." Ord. § 47-38. Membership in the Fund includes all active employees and members of the Town retirement system for the police and fire departments.³ The Ordinance also establishes a retirement board which is entrusted with the management of the Fund. See Ord. § 47-39. The other various provisions of the Ordinance address, inter alia, financing of the Fund, purchases of credit, and administration of, and eligibility for, retirement benefits. See Ord. §§ 47-43 - 47-55.

The Union filed a grievance on March 10, 2011, alleging that the Town had violated Article XX of the CBA and established past practices of the parties by enacting the Ordinance. (Grievance, Town's Compl., Ex. 2.) The Union requested that the Town immediately rescind the Ordinance and make whole any Union member affected by the Ordinance. Id. After the partiesfailed to resolve the grievance, the Union filed a Demand for Arbitration on April 6, 2011. See Demand for Arbitration, Town's Compl., Ex. 3.

On September 19, 2011, arbitrator Marcia L. Greenbaum (Arbitrator) held a hearing on the grievance.⁴ See Decision, Town's Compl., Ex. 5. The issues submitted for her consideration were:

"1. . . . did the Town of Johnston violate Article XX and/or any other applicable articles of the [CBA] and/or duly established past practices of the parties, when it enacted Town Ordinance 2011-1, dated February 17, 2011?

2. If so, what shall be the remedy?" Id. at 2.

Both parties submitted post-hearing memoranda, reply memoranda, and thirty-five joint exhibits. See id. at 1. As of the time of the hearing, no Union member had been deprived of his or her bargained-for benefits by enforcement of the Ordinance.⁵ See id. at 146.

The Arbitrator issued a written decision on June 21, 2012.⁶ See id. at 148. In her decision, she interpreted the first issue submitted by the parties as "not whether the Town has legislative or corporate authority to pass an ordinance, but rather whether the text of the statute enacted is contrary to the terms of the [CBA]." Id. at 130. In answer to this question, the Arbitrator concluded that the Town had "violated Article XX, other applicable articles of the [CBA] and duly established past practices of the parties, when it enacted Town Ordinance 2011-Id. at 148.

On the issue of remedy, the Arbitrator acknowledged that an award of damages would be inappropriate since no Union member had yet to suffer financial or monetary harm. See id. at 147-48. She also disavowed any authority to order the Town to amend or rescind the Ordinance. Id. Instead, the Arbitrator fashioned the following remedy:

"3. Until the Town Council voluntarily amends Ordinance 2011-1 to be in conformance with the [CBA] or until the parties renegotiate the [CBA], the remedy shall be an order for the Town to cease and desist from enforcing any portion of [Ordinance 2011-1] that conflicts with the terms of the Agreement, as determined in the above Opinion[.]

4. The Arbitrator shall retain jurisdiction over any matter that arises under the [CBA] that was not brought forth in this case, that involves Article XX-Pensions, and calls for a remedy other than those set forth herein. Such retention shall be in effect until a successor contract takes effect." Id.

The Town filed a Petition with this Court to vacate the Arbitrator's award on July 2, 2012, followed by a Motion to Vacate on August 9, 2012. The Union filed a Cross-Petition to Confirm the award on July 19, 2012, followed by a Motion to Confirm on October 2, 2012. The Court held oral arguments on this matter on April 17, 2013. At oral arguments, the parties indicated that the Union and the Town had yet to reach agreement on a successor contract to the CBA. See Tr. 6, Apr. 17, 2013.

IIStandard of Review

Rhode Island has a strong public policy in favor of the finality of arbitration awards. See N. Providence Sch. Comm. v. N. Providence Fed. of Teachers, Local 920, 945 A.2d 339, 344 (R.I. 2008) (citing Pierce v. R.I. Hosp., 875 A.2d 424, 426 (R.I. 2005)). To preserve the integrity and efficacy of arbitration proceedings, this Court performs an extremely limited review ofarbitration awards. Aponik v. Lauricella, 844 A.2d 698, 704 (R.I. 2004). Section 28-9-18 expressly circumscribes the grounds upon which this Court can vacate an arbitration award. See Sec. 28-9-18. That section provides, in pertinent part:

"In any of the following cases the court must make an order vacating the award, upon the application of any party to the controversy which was arbitrated:

(1) When the award was procured by fraud.

(2) Where the arbitrator exceeded their powers, or so imperfectly executed them, that a mutual, final, and definite award upon the subject matter submitted was not made.

(3) If there was no valid submission or contract, and the objection has been raised under the conditions set forth in § 28-9-13." Sec. 28-9-18.

A party claiming that an arbitrator exceeded his or her authority bears the burden of proving that contention. See Coventry Teachers' Alliance v. Coventry Sch. Comm., 417 A.2d 886, 888 (R.I. 1980) (citations omitted). "[E]very reasonable presumption in favor of the award will be made[.]" Id. If the award is not vacated, modified, corrected or unenforceable, the Court must confirm the award upon application of any party to the arbitration. See Sec. 28-9-17.

IIIAnalysis

In support of its Motion to Vacate, the Town argues that the Arbitrator exceeded her authority by: (1) rendering a decision on the merits of the grievance that is irrational, not passably plausible, and fails to draw its essence form the CBA; and (2) crafting remedies that are irrational and fail to draw their essence from the CBA.

In response, the Union asserts that there is no basis for vacating the award. In support of its Motion to Confirm, the Union argues that the Arbitrator gave a passably plausibleinterpretation of the CBA and acted within her contractual authority by issuing an injunction and retaining jurisdiction.

AMerits

This Court "typically refrains from reviewing the merits of a previously arbitrated dispute." Woonsocket Teachers' Guild, Local 951 v. Woonsocket Sch. Comm., 770 A.2d 834, 836-37 (R.I. 2001) (citing State v. R.I. Alliance of Soc. Serv. Employees, 747 A.2d 465, 468 (R.I. 2000)). A motion to vacate does not permit "judicial re-examination of the relevant contractual provisions." Jacinto v. Egan, 120 R.I. 907, 912, 391 A.2d 1173, 1175 (1978) (citations omitted). It is the arbitrator's judgment for which the parties have bargained and by which they have agreed to abide. Id. at 911, 391 A.2d at 1175. Accordingly, an arbitrator's misconstruction of the contract is not grounds for vacating an award. Id. Pursuant to § 28-9-18, however, this Court must overturn an arbitrator's decision on the merits when the arbitrator has exceeded his or her authority by giving an interpretation that fails to draw its essence from the agreement, is not passably plausible, reaches an irrational result, or manifestly disregards a provision of the agreement. See, e.g., City of Newport v. Lama, 797 A.2d 470, 472 (R.I. 2002); Woonsocket Teachers' Guild, 770 A.2d at 837; Dep't of Children, Youth and Families v. R.I. Council 94, 713 A.2d 1250, 1253 (R.I. 1988).

An arbitrator may interpret external sources of law that are necessary to the resolution of a grievance brought pursuant to a collective bargaining agreement. See R.I. Bhd. of Corr. Officers v. State, 643 A.2d 817, 821 (R.I. 1994); see also Vose v. R.I. Bhd. of Corr. Officers, 587 A.2d 913, 914 (R.I. 1991) (arbitrator may decide questions of law). A mere error of law is not, however, grounds for vacating an arbitrator's award. See N. Providence Sch. Comm., 945 A.2dat 344; Warwick Teachers' Union Local 915 v. Sch. Comm. of...