No. 88-513

IN THE SUPREME COURTOF THE STATE OF MONTANA

ROGER THOMPSON, Plaintiff and Appellant, -vs

## - BOARD OF TRUSTEESOF SCHOOL DISTRICTNO. 2, YELLOWSTONE COUNTY, MONTANA, said board consisting of the following;MAURICE 

### R. COLBERG,JR.; FRANK J. KOLENDICH; HEWES

### D. AGNEW; ELLEN ALWEIS; KAREN TRASK DOOLEN;JIM LOGAN,DOUGI,ASR. SIPES;and MIKE YOUNG, Defendantsand Respondents.

APPEAL FROM: District Court of the Thirteenth Judicial District, In and for the County of Yellowstone, The Honorable Russell

### K. Fillner,Judge presiding.
COUNSEL OF RECORD:
ForAppellant: Charles 

### F. Moses; Moses Law Firm,Billings, Montana
For Respondent:

I_ P- LaurenceR. Martin and Sol Lovan;Felt & Martin, -J Billings,Montana 

### .--,

q- '
Submitted on Briefs: April 27, 1989 Decided: June 7,1989

Clerk

### Mr. Justice Fred J. Weber delivered the Opinion of the Court.

This suit arises out of the nonrenewal of plaintiff's teaching contract with School District No. 2 in Billings, Montana. Plaintiff appealed the Board of Trustees' decision to terminate his employment and the reasons given for nonrenewal therein to the District Court for the Thirteenth Judicial District, Yellowstone County. The District Court granted summary judgment in favor of the School District on plaintiff's claims for tort liability, punitive damages, violation of due process, and breach of the implied covenant ofgood faith and fair dealing. The courtgranted theplaintiff's cross-motion for summary judgmentbased on the insufficiency of the reason given for nonrenewal. The court remanded the case back to the School District for a more sufficient statement of reasons. On appeal, the plaintiff challenges the adequacy of the District Court's remedy, alleging that there has been a breach of the employment contract and that he is entitled to monetary damages. Based
on our holding that the plaintiff is not entitled to pursue this remedv, we affirm the District Court's granting of 

### summary judgment in favor of the School District and vacate the Order of remand. We reframe the issues as follows: Where a nontenure teacher has received notice of termination under § 

### 20-4-206,MCA 1985,

### and challenges the sufficiency of the reasons given for termination, to what extent has the teacher the following remedies: 

### (1) Remedies under the grievance procedure of the Professional Agreement or union contract between the School Board and the Teacher'sAssociation. (2) 

### The right of appeal under the nontenure teacher's
severance policv contained in the union contract providing

### for appeal of the notification to the School Board; and subsequent rights to appeal to the County Superintendent of School, and then to the State Superintendent,and finally to the court system under the Montana Administrative Procedure Act. (3) Right to proceed inDistrict Court seeking a recovery of damages suffered as a claimed result of the insufficiency of the notice of termination given to the teacher by the schooldistrict. Section 20-4-206, 

### MCA 1985, with regard to nontenure teacher notification, provides in pertinent part as follows:

Notification of nontenure teacher reelection 

## -- acceptance

## -- termination and statementofreasons.

(1) The trustees shall provide written notice by April 15 to all nontenure teachers who have been reelected. Any nontenure teacher who does not receive notice 

### of reelection or termination shall be automatically reelected for the ensuing school fiscalyear.

(3) When the trustees notify a nontenure teacher of termination, the teacher may within 10 days after receipt of such notice make written request of the trustees for a statement in writing of the reasons for termination of employment. Within 10 days after receipt of the request, the trustees shall furnish such statementto the teacher.

The pertinent portion of the Professional Agreement, or union contract, between the Board of Trustees of School DistrictNo. 2 

### and the Billings EducationAssociation are as follows:
Article IV, 

### Section 7. 

### Non-Tenure Teacher Severance -

### - Policy: 

### --

### Subd. 1. Every non-tenured teacher shall be entitled to the following rights if his/her contract i.snotbeing renewed. (a) The teacher shall be notified by the Superintendent,inwriting, that his or her contract will not be 

### renewed pursuant to Montana statutes. fb) The notice shall state the specific reasons for non-renewal. (cl The teacher may appeal his/her non-renewalto the Board of Trustees or a committee thereof, by 

### May 1. 

### The Board, or its committee, shall reach a decision within twenty (20) 

### days of the submit-talof the appeal. Subd. 2. 

### The decision of the Board, or its 

### - committee, shall not be subiect to the grievance procedure as outlined in Article XIT. 

### Article XIL,
Section 4. 

### AdjustmentofGrievance, Time %imitation and Waiver: The parties shall attempt to adjust all grievances which may arise during the course of employmentof any teacher within the School District in the followingmanner: Tf

### a grievant believes therehas been a grievance, he/she shall discuss the matter with the responsibleadministrator in an attempt to arrive at a satisfactory solution. If the griev-- ance is not resolved as a result of this meeting, the grievance shall be reduced to writing, setting forth the facts and the specific provisions of the Agreement allegedly violated, and the particular relief sought. An alleged grievance must be presented in writing within twenty (20) days of the occurrence of the event,orwithin twenty (20) days of the time that the grievant through the use of diligence should have known of the alleged grievance. Subd. 1. 

### Level I: The written grievance, siqned by 

### the grievant involved must be presented to the responsibleadministratorwithin t.he time limits provided in Section 

### 4. Theresponsible administrator shall meet with the grievant within seven 

### (7)days after receipt of the written grievance and give a written answer to the grievance within five (5) days of the meeting. The Grievant has five (5) days in which to either accept the answer or appeal it inwriting to thenext level. Subd. 2. Level 11: If the grievance has not been resolved in Level I, it may then be processed to Level I1 by presenting the written grievance to the Superintendent. The Superintendent or his designee shall meet within ten (10) days after receipt of the written appeal to discuss the problemwith the grievant. Within seven (?) days of themeeting the Superintendent or his designee shall submit his written answer to the grievant.
Subd. 3 Level 

### LIL: If the grievance remains unresolved at the conclusion of Level 11, i.t may 

### he submitted for binding arbitration at the discretion 

### of the Associati-onprovided written notice of the request for submission to arbitration isdelivered to the Superinten-, dent's Office within ten (10) days after the date of receipt of the decision at level TT. The case has a complex procedural historywhich unfortunately extends over a period starting in 1983. Mr. Thompson
was employed 

### by School DistrictNo. 2! as the choir director at BillingsWest High School. He served in that capacitv for threeyears,each yearbeing offered a one-year contract. 

### Tn March, 1983, the Board of Trustees voted not to renew Mr. Thompson's contract for the 1983-84 school year. That contractwould have granted him tenure rights. Mr. Thompson was notified of the Board's deci-sionby letter dated March 30, 1983 which said:

In accordance with Section 20-4-206, of the School Laws ofMontana, Annotated, (copyattached!, you are provided notice of termination of your contract with School District No. 2, at the close of the 1982-83 schoolyear.In keeping with the philosophy of School District No. 2 of retaining only the best teachers for tenure, School District No. 2 would be better served by another teacher in this position.
On March 31, 1983, Mr. Thompson responded by letter which stated:

In accordance with Section 20-4-206, MCA, I am requesting the reason or reasons for the board's decision to terminate my employment with the district. Also, in considerationwith the board's statement at the March 29, 1983 meeting, I am requesting a hearing before the board to address this matter.
In response to the foregoing letter, the Board sent a letter toMr. Thompson dated April 6,1983, which stated: This responds to your letter of March 31, 1983. You have already been notified of the termination of your contract with School District No. 2, by letter from Dr. Poore,dated March 30, 1983. This letter included the reasons for the termination of your employment.
Pursuant to your request, you may appeal your nonrenewal to the Roard of Trustees at the Board meeting to be held at 4:00 p.m., Monday,April 11, 1983, at the Administration Building. This appeal is granted you under the provisions ofArticle IV, Section 

### 7, of the Professional Agreement between the Board of Trustees and the Billings Education Association.
On April 11, 1983,Mr. Thompson and his counsel appeared hefore the Board of Trustees. Mr. Thompson's counsel presented argument but was not allowed to call any witnesses. The Roard characterized the proceeding as an "appeal" rather than a "hearing"and therefore did not allow the presentation of witness testimony. Fol..l.owingthe presentation by Mr. Thompson's counsel, the Roard voted to affirm its prior decision

### not to renewMr. Thompson's contract.In a letter dated April 11, 1983, addressed to Mr. Thompson,he was advised as follows: You have been afforded an appeal OF the termination of your employment with School District No. 2 at the cl.ose of the 1982/83 school year, pursuant to Article IV, Section 7 of the ProfessionalAgreement between the Roard of Trust-eesof SchooJ-District No. 2, and the Billings Education Association. This is to notify you of the Board's decision, denying your appeal, and affirming the prior c-leci--. sion of the Board of Trustees, to terminate your contract and employmentwith School DistrictNo. ?, at the close of the 1982/83 schoolyear. The Board did not advise Mr. Thompson orally or by the above letter of any additional reasons in support of the nonrenewal. 

### By notice dated April 19, 1985,Mr. Thompsonappealed to the County Superintendent of Schools. By order denyina appeal dated April 28, 1983, the County Superintendent concluded that the appeal had failed to meet the requirements set forth in the Administrative Rules of Montana in Failing to set forth aproper caption,names and addresses, clear and concise statement of the matters asserted.,a statement indicating that the petitioner has a contested case and that the County Superintendent has proper jurisdiction together with references to the particular sections of the statutes and rules involved. The County Superintendentconcluded that he did not consider this a contested case and that he lacked jurisdiction. No appealwas taken by Mr. Thompson from that order. As a result, there was no further attempt to follow theprocedure outlined in such cases as Throssellv. Board of Trustees of Gallatin County (Mont. 1988), 

### 757 P.2d 348, 45 St.Rep. 1228, and Yanzick v. School District No. 23, Lake County (1982), 196 Mont. 375, 641 P.2d 431. This was the extent 

### of the appeal procedure exercised under the

### administrative law approach as outlined in the above cited
cases. In addition to proceeding under the appellate approach
as previously described, Mr. Thompson also proceeded under the grievance provisions of the union contract, and in particularArticle XII, Section 4which is previously set forth. On April 5, 

### 1983, Mr. Thompson filed a 

### grievance with the School District under the provisions of Article XII, Section 4 

### of the union contract. The grievance was made on the regular Grievance Report form used 

### by the Billings School District and was signedby the Billings Education Association representative. The keyportions of that form stated:

Date grievance occurred: March 29, 1983
Statement of facts: Teacher was terminated on March 29, 1983. Inaccurate evaluations are a factor in this termination. Specific Provisions of Agreement Alleqedly Violated: Article XV

## - Sections 1, 2, 5, 6 

### Particular Relief Sought: Evaluation dated March 1, 1983, is to be removed from his file and grievant is to be offered a contract for the 1983-84 school year.
In support of the School District's motion for summary judgment, the uncontradicted affidavit of the Director of Personnel of the School District established that the grievancewas denied through Level I and I1 administratj-vehearings. As previously set forth,those levels provide at Level 

### I for the presentation of 

### the grievance to the responsihle administratorwho is required to meet with the grievant,and denied the written grievance. A.tLevel IT, 

### the grievancewas presented to the Superintendent, and such Superintendent also denied the grievance. The next choice under the contract for Mr.

### Thompsonwas to submit that grievance forbinding arbitration at Level 111. 

### The affidavit establishes that the Billings Education Association,Mr. Thompson's representative,dropped its attempts to move the grievance to binding arbitration. As a result, the record establishes that Mr. Thompson failed to proceed through to binding arbitration and thereby obtain
a final binding arbitration determination of his grievance. In considering the grievance requirements under the union contract, it is important to keep in mind that Mr. Thompson's grievanceas stated in the Report.Formwas limited to his argument that the evaluation dated March 1, 1983, was inaccurate and should he removed from the file and that he should be offered a contract for the next school year. At that point, Mr. Thompson made no suggestion that the reasons given in the notice ofnonrenewalwere insufficient. This is significant because he now urges that the insufficiency of suchnotice shouldbe aproper basis for the award of damages in the District Court action which was brought against t.he SchoolDistrict. The next procedural aspect is the filing of the complaint by Mr. Thompson against the School District. On June 16, 1983, after all the above-described procedures were followed, Mr. Thompson filed his complaint in the District Court of Yellowstone County. In that complaint he alleged that the defendantshad negligently,wrongfully and unlawfully terminated his employment and that the School Board did notprovide standards or guidelines for termination, thathis termination was prejudged, that the District violated the openmeeting law, that such terminationdid not represent the independent and informed judgment of each member, and that the notice was defective "in that it did not set forth the specific reasons for his termination as required by law." The compl

### aint cl

### aimed damagesby hei-nodeprived of emplo\pentand terminated without right. EF-L.er 'she riling of variouc pleadinvs, a motion forpartial sumr11cir;7 judgment was filedby theplaint_;-ff 5x16 the rlefenclant also filedmotions for surrunary judgment. By order c7,ate6 Parch 1 

### , 1.988, the District Court granted summary juc-Igment toboth the plaintiff and the df? Ft~:f\~lh r*?
, -r .n 9rantlny themotion of the plaintif' vhorrip~rn for summary iudgment astothe suf5cj~rrcy or the nntjce, the Order sf-ate?:

?. That the P7ajn-f-i .'T'F C:rcss-Potion for Summary Judgment crfthe a13eged insufficiencyof 

### +he ztatu-- tory notice requireme~ts is hereby GRANTED. This issue is REMANDED tothe school board of the Fillings ''!$1 Sc:!lc\c-I. ristrict No. 2, Yellowstone Cour,-. ty, Wontana, ant: saic-1 school hoard is direct& to provide the Plainti"F wF+h specific reasors fcr rc.r.--renewal of his contract within thirty days o' the date hereoT. The Coilrt recogr?Fzes that this cause arose over fivevears aqo and thatthe school boar?. rr.&y no ionger be able toprov:i-de 

### ?he P1.a.intiff with speciLic reasons 'or non-renewal due tc changes 05 members or. the schocl board, and chang6-s of personnc! 

### , lost or misplaced records a~cl the 1;-ke. T-F the hoard is 1117abieto comply with the Caul-kl:l: Crcleu due to such reasons, it may certify such +'act to the Court within the tine herei~ before provide6 and serve a copy of such certification to counsel for the Plaintif+. On the other ha-nc!, if +he board is able tocomply by providing PIaintiFFwith spw:.; l(*reZscns fornon-renewal and ceutifiricatiorr oF such compliance is rnac7e together with proof of service ofsuch ccrtifi-cation on counsel for Plaintiff, thenjudgne~lt may he entered accnreirclv. The Crcler c;T +he Dist-rict Court alsogranted the de5eendan+s1 ~no-lionfor summary judgmer~t. "n 1-he "ollowj-ng respects: regardin9 

### the nonapplicahilif-y

### of +hefi7orltana Opcn Feeting law; regardSrlq ihc. derendants

### ' claim that the i ndivFc?ual.ly named Trustees are immune Trom !!c?hi! jtj7; 2s tcl plainti'q's clajrn for imposition of pu~itive clamages as to both the Scho~l Pi1- r -I T ilit. re; detendants

### ' motion i-egariJ;nc thefailure to state a claim for bread1 

### 01 the covenant of good faith an< fair dealirg: and d~Tenc7arlf s' mtion lorthe failure tost-atea claim forwrongful discharge. The ~~C'ect oi the toregoing Order on summary iudgmert v7cs toremand tothe School Gistrici- 5 11 order toprovide Mr. Thompson with notice OF reascjr~s vrhir.11 net the requirement or' Bridyer Eciuca'r-io~i Association v. Board of Trustees, Carbon County (19841, 203 P:o~t. 21, 678 P.22 059. r.Tho~rpson challenged the adequacy of the remedy by motion to zlter or amencl cvhicl- C!-IP Fistrict Court denied. In his appeal Ilr, Thompson contends that the Schc~n:District was obligated to 

### Zurnish specific reaso~s fcr trir thet he was not affc)~-cit.cla nieaninqful appeal or a hearing, that there has bec11 breach of contract .milkhzt he iseritjtles todarvages. The key element is thatMr. Thompson contends he is entitled to damaqes whi(-.!? fla~rc~ eF3tctively been denied him by the
sun juc7qr11ent: he District Court and the above-described remanc?.

T

L. PXPV".EI~LrJ:,C, ITNDER GRTEVANCE PROCEDITFF OF UNION CONTRACT
IIhis Grievance &port Mr. Thcmpscn referred to his ter~iliation on March 29, 1983. IIe thcn clsined that inaccurate eva1uet.ions were a factor in that deterniniltion and asked that the e~raluatsorlSated biarch 1, 1983, be removed from his file. fEis c)tm G~rievanceReport contra2jcts the basic assertion 

### ir! the complaint filed in theDistrictf Ccurt where he complains thatthenoticewas insufficient. 1~~~1 conc,l1~dc"hzt the grievanceprocedure under theurinn contract is the binding metl?c?c7 or cirisposj-ng of the issues
ra:.;eF 11nc'er the qrievance ~rocer?~irc-, F'e therefore conclude t-hat Ylr - I~I could not have procee?ec' ;ntc Disl-rj-ct

### Court on the same issues raised in the grievance procedure. Under the agreement negotiated by the Billings Education Association with the School District, the final decision in the grievance process is a binding arbitration. Because Mr. Thompson chose not to proceed to binding arbitration, that terminated any further rights with regardt to the claimed grievance. As we review Article IV, 

### Section 7 

### of the union contract,we conclude that the issue of the sufficiencyof the notice of termination properly could have been included in the Grievance Report form and handled through the gri-evance procedure. Had he properly proceeded in that manner, his right to receive a specific statement of reason for nonrenewal would have been satisfied through the grievance procedure. In this instance he chose not to proceed to arbitration
as he apparently concluded that he preferred tomake a claim for damages in District Court. We hold that the proper method for obtaining a statement of specific reasons for nonrenewal by Mr. Thompson was set forth in the grievance provisions of the union contract. We further hold that by failing to follow these contract provisions,Mr. Thompson has lost his right to obtain specific reasons fornonrenewal. We therefore conclude that that the District Court improperly remanded to the SchoolDistrict.

11. RIGHTOF APPEALUNDER CONTRACT SEVERANCEPOLICY In his complaint in District Court Mr. Thompson argues that the notice did not contain specific reasons for nonrenewal. In making these contentions he overlooks the procedure which he previously followed. We pointed out that

### Mr. Thompson appealed his nonrenewalto the Board of Trustees of the School District. Pursuant to the contract, he was given an appellate hearing and the decision by the School Board was affirmed. At that point Mr. Thompson appealed to the County Superintendent of Schools. As previously described, the County Superintendent declined to rule on his appeal. Under the administrative procedure outlined in Throsselland Yanzick,Mr. Thompsonwas required to appeal to the State Superintendent and in the event of an adverse ruling, only then did he have the right to proceed in District Court, following the procedure under the Administrative Procedure Act. As a result, his remedies would have been limited to recovery appropriate under the union contract and theAct. We hold that by failing to follow the administ-rative procedure outlined in the mentioned two cases,Mr. Thompson gave up his right to a finaldeterminationunder the administrativeprocedure required inMontana. We therefore conclude thathe no longerhad a claim for nonrenewalofhis contract.

111. nISTRICT COURTCLAIM OF DAMAGES 

### Mr. Thompson argues extensively that he has a right to
recover all damages which he has suffered in all- of these proceedings, including references to the idea of reinstatement,andmost important,to monetary damages. As Mr. Thompson summarized in his own brief,he claimshe is entitled to damages for the breach by 

### the School District of his contract. We conclude that he does not have such a rightunder the factsof this case. As previously outlined,Mr. Thompsonhad the opportunity of grieving the sufficiency of the notice itself under the grievance procedures. He chose not to go to bindingarbitration. As a result, he no longer 

### had a right to con

### tend! in the Pi-strip:. Cnllv: ~~c{-kon that the notice itselfwas

- insufficient. 

### -n a sirnjlar way, if Mr. Thompscn believerthat he properl;: chnn7d have been retained as a non+c$~~~ire teacher, the ~rocecl~re tc be foilowed was that previously nizt-linrcy ur.6er Fart I1 of this opinion. As he Fai7ecl to foT-?.owthe appropriate adnlinistrat5vt.proceclure

### ,he isbarred "ram rnak?'r.cr the sarre con?-~n' ;c)lt:. In '-hcpresent proceedings before theDistrict Court. ICe thereCc,rt~ hci1(7 It there were no further remedLcs available toMr. Thompscr~ur1~3er 1.lle complaint which he fj!~?. in the 0:stri ct Court; anc? ccnc!vde that tht2 l?.'s-l rict Court 11

### orqranted sumrnarv judarn~rton the varjous theories requested by the School District. P'e vacate tbererranc!by the E;n: I-ic:: Cc,urt tothe School ~i~t~: cia:, 'here isno requirement for such further consideration by the School Dlst+rictu.nc'~rthe unicr ccnt:rii(--'. PSth thzt f:>:ception we affirmtheDistrict Cclurf-.

%eConcur: ,A

Mr. JusticeJohn C. Sheehy did notparticipate inthis decision.