Opinion ID: 437224
Heading Depth: 2
Heading Rank: 2

Heading: The Parents' Right to Rely on the State Administrative Decision

Text: 109 The State and Does argue that where the parents have relied on a final state administrative decision in their favor, a town or local educational agency should be estopped from obtaining retrospective reimbursement even though it prevails at final judgment. The Town maintains it is entitled to recover all monies it expended for John's education at the private school, should it prevail. 110 This court has affirmed the availability of equitable reimbursement to a prevailing party as a general matter in Doe v. Brookline, 722 F.2d at 919-21. 34 The posture of that case, however, was markedly different from this one. In Brookline, the state hearing officer ruled that the Town's proposed IEP, under which it planned to transfer the child from the private school he had been attending for two years at public expense, and reenroll him in a public school with special services, was adequate and appropriate. The parents then rejected the BSEA's decision and appealed to federal court. By contrast, here the parents maintained John in the Carroll School consistent with a state agency order in their favor. It was the Town that brought suit to reverse the State agency decision. 111 The Does argue that unless parents are of considerable means, few will be able or willing to implement a state agency decision in their favor if they stand liable to reimburse a town or local school system at final judgment. Cognizant of other situations, the State points out that where a state agency orders a town to fund a private placement, after ruling against a town's IEP, parents will be placed in the difficult position of having to choose between the state directive to maintain the child in the private placement at the risk of ultimately using their own funds, or of moving the child to the town's placement which the state agency has determined to be inadequate. Choosing the latter option would contravene the express congressional policy of consistency and adequacy in a disabled child's education during an IEP contest; should the judicial decision uphold the State and parents, the child will have spent two and possibly three years in an inappropriate school. In sum, the State and Does argue that in order for the Act to provide appropriate education for disabled children from wealthy and poor families alike, parents must be entitled to rely on a state administrative decision in their favor, and not be put at risk for reimbursement by a judicial judgment which reverses that decision. 112 Considering the Act as a whole and the interests it seeks both to protect and to further, we conclude that appellants' contentions must be sustained in part in the present case. Retroactive reimbursement by parents is not appropriate relief within the meaning of Sec. 1415(e)(2) where they relied on and implemented a state administrative decision in their favor ordering a particular placement. We emphasize again that our interpretation is guided by the cooperative federalism Rowley elaborated. The states are the chief arms of the federal Act's enforcement; their decisions should not be disregarded because of potential parental financial liability. Implementation of a state agency's determination of the appropriate education for a disabled child should not be delayed until the statute of limitations on an appeal has run or until a final judicial decision has been rendered where an appeal has been taken. Congress, through the principal author of the Act, has spoken unequivocally in this regard: I cannot emphasize enough that delay in resolving matters regarding the educational program of a handicapped child is extremely detrimental to his development. The interruption or lack of the required special education and related services can result in a substantial setback to the child's development. 121 Cong.Rec. 37416 (Nov. 19, 1975) (remarks of Sen. Williams, explaining Conference Committee bill to the Senate). 113 Cooperative federalism also requires the federal courts to accommodate state laws and regulations that place greater duties on towns than those imposed by the federal Act, see supra, Part II. The governing Massachusetts regulations require that whenever a placement is ... ordered [by the state agency] ... such placement shall be made forthwith, without any unnecessary delay. Mass.Admin.Code tit. 603, Sec. 409.0. Further, [n]o parents shall be required to bear any part of the cost of the instruction and support actually rendered or furnished to their child by a private school in which such child is placed pursuant ... to an order under Chapter 4 [by the state agency]. Mass.Admin.Code tit. 603, Sec. 504.5(e). Thus the State's procedures contemplate immediate implementation of the state agency's orders without risk of reimbursement on the part of parents. We think such an arrangement does not contravene the federal Act, and is a question of state-town relations in which the federal courts need not interfere. 114 We hold, therefore, that where the final state administrative decision rules a town's proposed IEP inappropriate and orders the town to fund placement, and the parents have complied with and implemented that decision, a town or local educational agency is estopped from obtaining reimbursement for the time period, usually one year, covered by the state agency decision and order. Here, however, the parents could not have relied on a state agency decision until January 1980, the middle of John's first year at the Carroll School. Although the enrollment of John in the Carroll School in August may have been a wise course of action, the parents had no basis for relying on a decision that had not yet been made. Accordingly, should the Town again prevail on remand, the parents can claim a safe-harbor estoppel from reimbursement only for that portion of the school year subsequent to the BSEA decision. 35 115 We cannot, however, endorse the defendants' proposed rule that the Town automatically be estopped from obtaining reimbursement for any and all expenditures during the entire period encompassed by judicial review proceedings. Their view is that parents are entitled to rely on the last state agency decision throughout the case, not just for the one year to which the decision was addressed, regardless of which party prevails. This smacks more of a penalty against the Town for bringing suit as an aggrieved party, Sec. 1415(e)(2), than appropriate equitable estoppel. Moreover, the congressional policies of cooperative federalism and minimal delay in implementation of a state agency decision are not served where no applicable state agency decision exists. Because, in addition, we recognize that the needs of disabled children change over time, Brookline, 722 F.2d at 918, we hold that parents do not have an absolute right to rely on a state order subsequent to the time period for which it was issued. 36 To be sure, in the present case the State ordered the Town to continue funding the Carroll School placement after 1979-80, despite the lack of IEPs or state substantive reviews for those years. Because of the unusual posture of this case, we think the relevance of this state action on behalf of the Does to the question of reimbursement for the years after 1979-80 is properly left for the district court to resolve in accord with the concerns we have expressed, supra. 116 The relation of Brookline to our rulings on reimbursement here should be made explicit. In Brookline, we recognized the availability of reimbursement to a prevailing party, 722 F.2d at 921; see also Doe v. Anrig II, 728 F.2d 30 at 31 but did not hold that reimbursement was automatically to be awarded as a result of prevailing on the merits. We viewed it then, as now, to be a matter of equitable relief, committed to the sound discretion of the district court. In Brookline, as noted infra, we found that serious procedural errors could foreclose the availability of reimbursement to a town. In the instant case, we hold additionally that parental reliance on a state order of relief forecloses the availability of reimbursement for the period of reliance and requires that where parents have paid the bill for the period, they must be reimbursed. 117 We conclude this section by stating what we hope is by now obvious in situations where reimbursement is an issue; whether to order reimbursement, and at what amount, is a question determined by balancing the equities. Factors that should be taken into account include the parties' compliance or noncompliance with state and federal regulations pending review, the reasonableness of the parties' positions, and like matters.