2015 UT App 63

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### T H E 

### U TA H 

### C O U RT O F 

### A P P E A L S

N E I L A ND E RS E N

, E T AL ., 1 Plainti ffs and Appellants,

v. D E PAR TM E NT OF C OR

RE CT I O N S

, Defendan t and Appellee.

Memor andumDeci si on No. 20131135-CA Filed March 19, 2015

Thi rd Di stric t Co urt, S alt Lake Depart ment The Honorable L.A. Dever No. 120904405

Lauren I. Scholnic k and Mat t W. Harr i son, Att or neys for Appellants Sean D. Reyes and Peggy E. Sto ne, Att or neys for Appellee

J UD G E J AM E S Z. D AVI Sauthore d thi s Memorandum Dec i si on, i n whi ch J UD G E S G RE G OR Y K. O R M E and M I C H E L E M. C H RI ST I AN S E N
concu rr ed.

DAVIS, Judge:

¶1 P l a in ti ffs a p p e a l the d i s tr i ct court’s ruli n g gr a ntin g s u m m a ry judgment in favor of the Utah Department of Cor rections (UDOC) on Plainti ffs ’ breach of contract clai ms. We affi rm.
¶2 Plainti ffs are current and former tr ansportat i on-uni t
corr ecti onal office rs. In 1996, UDOC enter ed into an agr eement

1. The parties on appeal are not li mi ted t o t ho se li sted but also i nclu de other parties whose names appear on the notic e of appeal

or who have ot herwi se entered appear ancesin thi s court.Andersen v. Department of Corrections

wi th corr ecti onal of ficers who work ed or anti ci pated work ing in the tr ansportat i on uni t. The agr eement establi shed a pay incenti ve amounti ng to a three -step pay-gr ade increase for tr ansportat i on offi cers. Thi s agr eement was modi fi ed in 2000 following a di spute between UDOC and the tr ansportat i on offi cers. The or i gin al agr eement prov i ded that an offi cer who left the tr ansportat i on uni t would lose the pay-gr ade st e p s t he offi cer had g ai ned by jo ining, but t he modi fi ed agr eement prov i ded that offi cers who se r ved in the tr ansportat i on uni t for at least three year s would “not lose any steps” and would “maintai n[] mini mally their current rat e of pay.” Offi c e rs who jo i ned the tr ansportat i on uni t after the agr eement w a s
mo d i fi ed si gned a memorandum of understanding reflectin g t he ter ms of the modi fi ed agr eement. 2

¶3 In 2007, UDOC’s new executive di recto r di scontinued the practic e of prov i ding pay incenti ves to o ff ice r s jo ining the tr ansportat i on uni t, and offi cers jo ining the tr ansportat i on uni t after the i ncenti ves were di scontinued d id no t si gn the modi fi ed agr eement. In 2008, UDOC shi fted all employees into a “straight-

3 l i ne career ladder pay scal e.” In response, Plainti ffs fi led a complaint again st UDOC, clai ming tha t t he modi fi ed agr eement prov i des for them to maintain a three -step pay-gr ade di fferential above other UDOC employees in perpet ui ty after three year s in the tr ansportat i on uni t and that UDOC breached t he modi fi ed

2. Although the memorandum of understanding si gned by offi cers who j o ined the tr ansportat i on uni t after 2000 contai ned sli ghtly d i ffe re n t l a n gu a ge th a n the modi fi ed agr eement, the di fferences are not relev ant to our analysi s. Therefore , for simpli ci ty, we refer to all of these agre ements collecti vely as “the modi fi ed agr eement.”

3. So me of the plainti ffs in thi s case are offi cers who j o ined the tr anspor t a t io n uni t aro und the same tim e the incenti ve prog ram
was di scontinued. The parties di spute whether these indi vidu als

are parties to the mo di fi ed agr eement, but in li ght of i ts gr ant of

sum mary judgment to UDOC, the d i s tr i ct court di d not resolv e that di spute. The i ssu e i s therefor e not befor e us on appeal.

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agr eement by shi fti ng tr ansportat i on offi cers who had si gned the modi fi ed agr eement i nto t he new pay scheme. 4

¶4 UDOC moved for sum mary judgment on Plainti ffs ’ clai ms, arg uing that the modi fi ed agr eement unamb i guously establi she s only t hat tr ansportat i on offi cers who have reached the thr ee-year mark cannot lose their three -step rais e, not that they are entitled to maintain a three -step di fferential in perpet ui ty. Plainti ffs responded that the language in the modi fi ed agr eement pert ai ning to rais es and promo tions makes the contract ambi guous as to whether the three -step di fferential mus t be pe rmanently maint ai ned. The di stric t court exami ned the contract and deter mined that “[t]here i s no language in the contract that supp or ts the i nterpr etat i on offered by Plainti ffs .” Accordi ngly, the di stric t courtgr anted UDOC’s motion for summary judgment.

¶5 On appeal, Plainti ffs assert that the modi fi ed agr eement i s ambi guous and that the di stric t court t he r e fore err ed in gr anti ng
sum mary judgment to UDOC. “[A] motion for su mmary judgment may not be gr anted i f a legal conclu si on i s reached that an ambi gui ty exis ts i n the contract and there i s a factual i ssu e as to what the parties i ntended.” WebBa nk v. American Gen. Annu ity Serv. Corp. , 2002 UT 88, ¶ 22, 54 P.3d 1139 (alterat i on in or i gin al) (ci tation and i nternal quotat i on marks omi tte d). We “rev i ew[] a sum mary judgment for corr ectness, giving no d eference to the tr i al court’s deci si on.” Bahr v. Imus , 2011 UT 19, ¶ 15, 250 P.3d 56.

¶6 A contract “ is ambi guous i f i t i s capabl e of more than one reasonable i nterpr etat i on becau se of unc ert ai n meanings of ter ms, mi ssing terms, or other faci al defi ci enci es.” Daines v. Vinc ent, 2008 UT 51, ¶ 25, 190 P.3d 1269 (ci tation and internal quotat i on ma r k s omi tte d). Plainti ffs arg ue that the modi fi ed agr eement i s ambi guous becau se i ts prov i si ons reg a r d ing salary, rais es, and promo tions can reasonably be interpr eted as prov i ding fo r a

4. Plainti ffs ’ salari es were not reduced under the new pay sch eme, but they assert that the new pay sch eme wi ll ha v e the effect of di luti ng their three-step pay-g rade differential over tim e.

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p e rp e tu al three -step pay-gr ade di fferential between tr an s p or ta ti on offi cers and non-transportat i on offi cers.
¶7 Plainti ffs poin t to three particu la r p ro vi s i ons in the modi fi ed

a gr e e m e n t th a t the y c onte n d m a ke the agr eement ambi guous. First, they examine the prov i si on indi cati ng that “salary increases to Tr a nsportat i on Uni t members wi ll mini mally be bench marked to Cor re ct io nal O ffi cers in t he Di vis i on of Insti tutional O perat i ons.” Plainti ffs i nterpr et thi s pro v ision as requiring “that when [nontr a ns p or tation] offi cers receive a pay rais e, former or current [transport ation] Offi cers also receive the equi valent pay rais e. Thi s i nterpr etat i on

. . . would effectuate a constant pay di fferential whereby [cu rr ent and former tr ansportat i on] Offi cers would remain above [non-transport ation] offi cers.” They next look to the prov i si on i ndi cati ng that an offi cer leaving the tr ansportat i on uni t “wi ll not lose any s teps, but wi ll be able to tr ansfer into a posi tion that i s the same as or closest to their current salary range that does not consti tute a promo tion, and maintai ns mini mally their current rat e of pay.” Plainti ffs i nterpr et thi s prov i si on as meaning “that the offi cer who received a three step increase wh en jo ining the [transport ation] uni t and then received a l l increases given [nontr ansportat i on] offi cers for a t least the three year s in [the tr ansportat i on uni t]

. . . wi ll come back into the ranks w i th a three step advantag e on any [non-transport ation] office r
. ” Fin ally, Plainti ffs poin t to the prov i si o n indi cati ng that a tr ansportat i on offi cer who “recei ves a promo tion

. . . wi ll receive the s ame salary i nc rease consi derat i on that other offi cers receive when they are promo ted.” They i nterpr et this p r o v i si on as requiring that even though a tr ansportat i on offi cer may already be earnin g the typical salary of a promo ted posi tion, that offi cer should “receive the same perc e n ta ge in crease or same dollar increase that [a] promo ted [nontr ansportat i on] offi cer [would] receive[],” whi ch would, again , have the effect of keeping t hat offi cer three steps above nontr ansportat i on offi cers who followed a c omparable career tr ack.

¶8 We do not di sagree wi th Plainti ffs that some language in the modi fi ed agr eement may be ambi guous as to ho w t ransport ation offi cers’ pay rais es and promo tions are to be handled as compared

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to those of non-transport ation offi cers. However , the ac tion take n by UDOC that tr i gge red the Plainti ffs ’ clai ms wa s the i mplementati on of a ne w pay sch eme appli cable to all UDOC employees. Plainti ffs do not co ntend that the new pay sch eme prev ents tr a n s p or ta ti on offi c e rs fro m re c e iving salary increases that

are e q uiv alent to those received by non-transport ation offi cers, reduces tr anspor t a tion offi cers’ salari es when they leave the tr ansportat i on uni t, or precludes promo ted tr ansportat i on offi cers from receiving rais es on par wi th those of other promo ted offi cers. 5 Thus, we fail to see ho w t he ambi gui ties poin te d o ut by Plainti ffs could supp or t a deter minati on that UDOC breached the modi fi ed agr eement by i mplementing the new pay sch eme. See Utah R. Ci v. P. 56(c) (pr ov i ding that sum mary judgment i s appropr i ate when “the pleadings, depos it ions, answ ers to interr ogat or i es, and

5. There i s ver y li ttle i n the recor d explain ing the new pay sch eme. Nei ther Plainti ffs ’ complaint nor their bri efs on appeal explain how the new pay sc he me i s expected to affec t Plainti ffs ’ abi li ty to maintain a three -step pay-gr ade di fferential

. At the hearin g on the motion for sum mary judgment, Plainti ffs ’ couns el suggested that the new pay sch eme puts a cap o n a n offi cer’s abi li ty to obtain rais es on ce t he o ffi cer reaches a certain pay level. Accordi ng to Plainti ffs ’ couns el, i f thi s sch eme i s appli ed to tr ansportat i on offi cers, t hen t he three -step differ ential of a tr ansportat i on offi cer who reaches the hi ghest pay level wi ll event ually be di luted as other non-transport ation offi cers receive salary incre ases. At or al arg ument on appeal, UDOC expl a ine d that the new pay sch eme establi shes mini mum salari es based on year s of service that would result i n salary i ncreases for offi cers who were earnin g belo w t he mini mum when they reached certain year s-of- service mi lestones. Sinc e tr ansportat i on offic ers are more li kely to be above the mini mum when they reach these mi lestones, their t hr ee-step d i fferential may be di luted as other offi cers maki ng below the

m in i mu m re c e ive ye a rs
- of

- s e rvi ce increases. However , the n e w p a y sch eme does not reduce Plainti ffs ’ salari es, and Plainti ffs have poin ted to nothin g to suggest that the new pay sch e me would preclude them from obtaining rais es and promo tions based on the

same s tandards as all other cor rectional offi cers.

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admi ssi ons on fi le, tog eth e r wit h the affi davits, i f any, show that there i s no genui ne i ssu e as to any material fact and that t he moving party i s enti tled to a judgment as a matter of law”).

¶9 Plainti ffs also rely on ext rins i c evidenc e to supp or t their arg ument that the modi fi ed agr eement was ambi guous. Although 6 di stric t courts a r e required to “rev i ew relev ant and credible ext rins i c evidenc e offered to demonstrate that th e r e is in fact an ambi gui ty,” Daines , 2008 UT 51, ¶ 31, “a finding of ambi gui ty after

a rev i ew of relev ant, ext rins i c e v i dence i s appropr i ate only when reasonably s upporte d by the language of the contract,” Watkins v. Henry Day Ford, 2013 UT 49, ¶ 28 n.2, 304 P.3d 841 (ci tation and i nternal quotat i on marks omi tte d). See id. (“The intro ducti on of any relev ant evi dence does not

. . . allow a li tigant to create amb i gui ty out of whole cloth or to advocate for an interpr etat i on that i s in no way supp o r t e d by the language of the underlyin g contract.” ( e m p h a s i s, ci tation, and internal quotat i on marks omi tte d)); Da in e s , 2008 UT 51, ¶ 31 (“[T ]here c an be no ambi gui ty where evidenc e i s offered in an atte mpt to o bscure other wi se plain contractual ter ms.”)

. Plainti ffs ’ i nterpr etat i on of the modi fi ed agr eement i s not “plaus ible and reasonable in li ght of the language used.” See Daines , 2008 U T 5 1, ¶ 31 (ci tation and internal quotat i on marks omi tte d). The language of the modi fi ed agr eement pro v ide s for tr ansportat i on offi cers to be t r e a ted the same as other offi cers for purposes of promo tions and rais es. A p r o mise to maintai n the tr ansportat i on officer s’ three -step pay-gr ade di fferential in

6

. Speci fi cally, they poin t to the affi davit of UDOC’s for me r executive di recto r, i n whi ch he aver red that t he modi fi ed agr eement i ntended for tr ansportat i on offi cers to “always be pai d at a hi gher rat e than offi cers who had never wo r k e d in [the tr ansportat i on uni t]”; the declarations of tr ansportat i on offi cers clai ming that UDOC informed them when they si gned the modi fi ed agr eement that their pay would always be t hr ee steps hi gher than offi cers who had not work ed in the tr ansportat i on uni t; and the hi stor y of the di spute bet ween t he tr ansportat i on offi cers and UDOC, whi ch led to the adoption of the modi fi ed agr eement.

20131135-CA 6 2015 UT App 63Andersen v. Department of Corrections

perpet ui ty cannot reasonably be construed from thi s language, except to the ext ent the pay-gr ade di fferential naturally persi sts as
a result of tr ansportat i on offi cers receiving rai ses and promo tions at the same r ate as o ther offi cers. It cannot re a so nably be r ead to 7 exempt tr ansportat i on offi cers from changes to UDOC’s pay sch eme that apply to al l U DO C employees. Thus, Plainti ffs ’ i nterpr etat i on i s not reasonably support ed by the language o f the contract. See Watk ins , 2013 UT 49, ¶ 28 n.2.

¶10 Becaus e the language of the modi fi ed a g r e e ment i s not reasonably subject to the interpr etat i on advocate d by Plainti ffs, we agr ee wi th the di stric t court that i t i s unambigu o us as t o whether Plainti ffs are entitled to ret ai n their three -step pay-gr ade di fferential i n perpet uit y
. Accordi ngly, we affi rm the di stric t court’s gr ant of summ ary judgment in f avo r o f UDOC.

7. As UDOC observe d at the hearin g o n it s mo tion for sum mary judgment, “[i ]n a perfect world

. . . , if [a tr ansportat i on offi cer] walked lockstep wi th another offi cer for [hi s or her] entire career,” the transportat i on offi cer could concei vably maintai n a three -step pay-gr ade di fferential under the ter ms of the modi fi ed agr eement.

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