Court Opinion

ID: 6472230
Source: CourtListenerOpinion
Date Created: 2022-06-26 14:22:23.186001+00
Date Added: 2024-06-11T09:11:36.660201
License: Public Domain

SUTIN, Judge (specially concurring). {39} The Association sued for breach of an agreement it characterizes as an employment contract. It alleged: Grievance # 2 — During a meeting prior to the Association voting to adopt the contract the Defendants represented to [Association] members that UNM PACT would reevaluate and adjust the salaries of police officers employed by [the University] Police Department by comparing salaries earned by officers employed by police departments in the geographical area. The Defendant’s [sic] explained that the University would look at the Albuquerque Police Department, and Bernalillo County Sheriffs Department and then would make recommendations that the wages to be paid should be in parity with these two Departments.1 This parity adjustment was a condition for the acceptance of UNM PACT into the contract. [The University] did perform such an evaluation but did not use the two above Law Enforcement agencies but instead broadened the scope of review. The result was the payment of salaries at a much lower rate than promised. (Footnote added.) The Association further alleged that the University chief of police failed to comply with the grievance procedure in the contract, in that he ignored four grievances and did not issue a written resolution of the grievances. In particular, the Association alleged that the failure to address the loss of pay grievance was a material breach of the employment contract. It sought “an award of the relief sought in [the] grievanee[ ].” {40} The primary issues on appeal boil down to (1) whether the Association effectively pursued and completed the grievance process, and (2) whether the Association’s claim for a particular wage different than that ultimately arrived at and contained in the UNMPact was barred under NMSA 1978, § 37-l-23(A) (1976) immunity. I concur in the opinion’s affirmance on the grievance process issue. I also concur in the opinion’s affirmance on the immunity issue, but write separately as to the latter. {41} The employment contract is a collective bargaining agreement. One provision under the compensation section of the contract states that “[t]he parties agree to participate in and fully implement the UNMPact classification and compensation study.” The trial court found that, in connection with reaching agreement, including the UNMPact provision, a University representative promised the Association that the UNMPact would contain a compensation amount for University police officers arrived at through a specific process and formula based on the average wage of first year officers working with the Albuquerque Police Department and the Bernalillo County Sheriffs Department. Relying on the University’s promises, the police officers ratified and the Association signed the contract with the inclusion of the UNMPact provision. {42} The trial court also found that the University breached the employment contract by failing to adhere to the process and formula promised, and thereby failing to pay compensation as promised. The University does not attack the findings of fact and conclusions of law supporting the promises and the University’s breach in failing to carry out the promises. The wage term is unquestionably a critical contract term. When it was approved and signed, the employment contract did not contain the specific wage term, nor did it set out any process or formula by which the University was to arrive at a specific wage term. The specific wage term is in the UNMPact, a document that was not in effect at the time the employment contract was signed, yet a document that was incorporated by reference into the employment contract. {43} The issue under Section 37-l-23(A) is whether the Association can maintain an action for breach of the employment contract, which incorporated the UNMPact, where the UNMPact, as it was ultimately implemented, contained compensation inconsistent with what it would have been had the University adhered to its oral promises as to how it would determine the compensation to be included in the UNMPact. The employment contract and the UNMPact are written contracts. The sole basis for the underlying action is broken oral promises as to what a written document, the UNMPact, as incorporated into the written employment contract, would ultimately provide. {44} New Mexico case law indicates that a written document might, under certain circumstances, give rise to a ground on which to tweak Section 37-l-23(A) in favor of dispensing with immunity. See Handmaker v. Henney, 1999-NMSC-043, ¶ 17, 128 N.M. 328, 992 P.2d 879 (appearing to state that immunity could be or was waived where the position from which the plaintiff was terminated was included in his written employment contract even though the position was not specifically mentioned in the contract); Treloar v. County of Chaves, 2001-NMCA-074, ¶¶ 15-17, 130 N.M. 794, 32 P.3d 803 (holding county not immune from physician’s claim of breach of employment contract where physician had a written contract with hospital but not with county, but where county assumed the obligations of that contract in a separate agreement with a third party, and stating that “[w]e do not believe that Section 37-l-23(A) requires the party making the claim to be a party to [the written] contract with the governmental entity [and] only requires a written contract underlying the claim”); Silva v. Town of Springer, 1996-NMCA-022, ¶ 9, 121 N.M. 428, 912 P.2d 304 (stating that employment rights contained in a town ordinance can become part of the employee’s at-will contract of employment); see also Garcia v. Middle Rio Grande Conservancy Dist., 1996-NMSC-029, ¶14, 121 N.M. 728, 918 P.2d 7 (holding personnel policy to be part of an implied employment contract, and that Section 37-l-23(A)’s waiver of immunity “in cases involving valid written contracts, incorporates an implied employment contract that includes written terms as set forth in a personnel policy”); but see Campos de Suenos, Ltd. v. County of Bernalillo, 2001-NMCA-043, ¶¶ 24-28, 130 N.M. 563, 28 P.3d 1104 (limiting Garcia’s holding to “contracts for employment,” and appearing to limit Garcia to circumstances of at-will employment, stating that such contracts “represent a unique body of law [to] be considered in light of the at-will employment rule”). {45} In regard to the issue of immunity, which is the issue that opens or closes the door to the Association’s contract claim, the opinion reduces the issue to what the UNMPact provision in the contract meant, Opinion ¶¶ 11-13, and conclusorily resolves the issue by analyzing the circumstances surrounding the oral promise under the authority of C.R. Anthony Co. v. Loretto Mall Partners, 112 N.M. 504, 509, 817 P.2d 238, 243 (1991), then simply concluding “that the dispute involves a term of the contract as contemplated in Handmaker.” Opinion ¶ 12. The opinion does not mention Trujillo v. Gonzales, 106 N.M. 620, 747 P.2d 915 (1987), nor does the opinion mention Garcia, 1996-NMSC-029, 121 N.M. 728, 918 P.2d 7, which discusses and distinguishes Trujillo. Garcia, 1996-NMSC-029, ¶¶ 18-19, 121 N.M. 728, 918 P.2d 7. Trujillo {46} I read Trujillo a little differently than my colleague, Judge Bustamante. There is nothing to indicate that the Supreme Court did not actually look at and consider the circumstances alleged by the plaintiff surrounding the oral promise of a two-year employment term. There is nothing to indicate that the Court did not make an analysis of whether the board of county commissioners’ minutes ratifying the plaintiffs position were ambiguous. Indeed, the Court appears to have made that analysis, and it held that “[t]he minutes are not ambiguous,” after determining that the oral promise of a two-year employment term was inconsistent with the recitation in the minutes that the plaintiff was appointed as an exempt employee and therefore one whose employment was at will. Trujillo, 106 N.M. at 621, 747 P.2d at 916. The changes in methodology for determining whether an ambiguity exists made in C.R. Anthony Co. and in Mark V, Inc. v. Mellekas, 114 N.M. 778, 845 P.2d 1232 (1993), do not change the rule applied under Trujillo, namely, that “[w]hile parties may leave portions of written contracts to oral expression, under such circumstances oral expressions are legally significant only if they are not contradictory and have some effect upon interpretation, application and legal operation of the written portion.” Trujillo, 106 N.M. at 621, 747 P.2d at 916. {47} In my view, Trujillo is not applicable. In the present case there exists no' inconsistency in the express oral promises and the express written provision in the employment contract relating to the UNMPact. Furthermore, Garcia interprets the essential holding in Trujillo to be that immunity existed because a county commissioner could not legally bind the county by promising a two-year employment and, therefore, the plaintiff “could allege no valid written contract.” Garcia, 1996-NMSC-029, ¶ 18,121 N.M. 728, 918 P.2d 7; see also Caw/pos de Sueños, 2001-NMCA-043, ¶ 31,130 N.M. 563, 28 P.3d 1104 (same). Thus, I do not think Trujillo is particularly useful or instructive in arriving at a result in the present case. {48} The University made oral promises to employ a specific process and formula to determine a wage figure, and the written contract as it ultimately came about when the UNMPact was adopted contained a wage figure reached by a process and formula different than that promised. The explicit promises of process and formula, and the' explicit written contract salary figure, are not inconsistent or contradictory. What is inconsistent is the process and formula. While the action is one for breach of a written contract, the oral promises are the subject of the breach. The Association asserts that the employment contract was breached, but the unwritten, oral promises are the sole underlying basis for that claim. The asserted breach lies in the failure of the University to adhere to the process and formula it promised to follow in arriving at a salary figure for the University police officers. Handmaker {49} The opinion cites to and places its bets on Handmaker, but nowhere discusses or analyzes the case. The Court in Hand-maker determined that the plaintiff had a written employment contract with the University of New Mexico. 1999-NMSC-043, ¶¶ 17, 22, 128 N.M. 328, 992 P.2d 879. The University conceded that the position from which it terminated the plaintiff was included in the written employment contract even though the position was not specifically mentioned in the contract. Id. ¶ 19. The Court, therefore, concluded that, because there existed a written contract containing the term that was the subject of the claim, Section 37-1-23(A) did not bar the plaintiffs claim of breach of contract. Handmaker, 1999-NMSC-043, ¶¶ 15-17,128 N.M. 328, 992 P.2d 879. This result moved the Court onto another issue, which was whether the University was entitled to judgment as a matter of law on the ground it could terminate the plaintiff from a particular position. Id. ¶¶ 18-19. The Court discussed the parties’ contentions, but ultimately determined that whether summary judgment was appropriate was not an issue to be decided on a writ of error (the writ having been granted and disposed of on the issue of sovereign immunity). Id. ¶ 20. The Court thus returned the case to the district court. Id. ¶ 21. {50} In citing Handmaker, the opinion and Judge Bustamante necessarily rely on a footnote in Handmaker. Id. ¶ 19 n. 2. That Handmaker footnote relates to the following statement in the text: Additionally, [the University] correctly asserts that in New Mexico there is a presumption that termination from employment is at will unless otherwise agreed upon by the parties, and [the University] thus claims that, because only his position as associate professor was protected by tenure, [the plaintiffs] administrative positions were terminable at will. Id. ¶ 19 (citation omitted). {51} The footnote focuses on the University’s “written policies and procedures and written statements made to [the plaintiff]” claimed by the plaintiff to “constitute an implied contractual term of termination for good cause only.” Id. ¶ 19 n. 2. The University contended that the plaintiff could not survive summary judgment on the merits with respect to his good cause only contention because his claim was based on oral representations by officials of the University, precluded by Section 37-l-23(A). Id. The fact section of the opinion in Handmaker does not mention oral statements. See id. ¶¶ 2-6. Neither does the Court’s discussion of the district court’s determination or its discussion of and holding that the plaintiffs employment contract was written. Id. ¶ 17. Indeed, in that discussion, the Court stated, significantly: “In this case, [the plaintiff] had written employment contracts with [the University], His breach of contract claim centers around the terms of employment under those contracts, including the procedure and grounds necessary for termination from an administrative position.” Id. This language indicates, it would appear, that the Court thought “the procedure and grounds necessary for termination from an administrative position” were “terms of employment under those [written] contracts.” Id. {52} In my view, nothing in the Hand-maker footnote indicates or was intended in any way to say that there existed oral representations regarding termination procedures (e.g., good cause only) on which the plaintiff relied for his breach of contract claim. Further, nothing in Handmaker indicates that completely verbal promises as to important contract terms can be considered with respect to either formation of a contract or the interpretation of words in an existing written contract. In my view, on the issue in the present case, Handmaker is not helpful. Policy, Harm, and Result {53} The University sets out the policies behind Section 37-l-23(A), as discussed in Campos de Sueños: Prevent fraud and protect the public purse by encouraging adherence to an appropriate process in governmental contracting, including formality and public scrutiny. See Campos de Sueños, 2001-NMCA-043, ¶¶ 13-14, 29, 130 N.M. 563, 28 P.3d 1104. It also argues the position, set out in Garcia, that “governmental entities enter into more contracts than many entities in the private sector,” and that “[t]he volume of public contracts is such that unless they are put to writing, the terms as to any one would likely be long forgotten in the event a dispute arose.” See Garcia, 199G-NMSC-029, ¶ 16,121 N.M. 728, 918 P.2d 7. {54} I am unpersuaded that the protections intended to be granted by Section 37-1-23(A) have any persuasive value in this case. We are not concerned with individual employment or commercial contracts. We are concerned with a collective bargaining agreement, one that can receive public scrutiny and therefore is not likely subject to fraud. There exists no scent or hint of fraud in this case. Yes, the public purse is at risk, as it always is in government contracting. However, whether to hold government accountable in public contracts here must depend on other policy concerns than imposing on the public purse. {55} Further, in this case, there was an impasse in wage negotiations. The University sent a representative to resolve that impasse, and the impasse was resolved based on the representations, if not assurances, of the University representative. Under these circumstances, the University should take the risk. The contract was signed anticipating that the UNMPact would be adopted at a later time. The parties understood that what was represented would be reflected in the UNMPact and they put a provision in the employment contract referring to the UNMPact, presumably to indicate that the parties understood what the UNMPact would contain based on the promised process and formula for determining the wage figure. What went into the UNMPact was under the control of the University. In collective bargaining, it is highly unlikely that a union collective bargaining agent would agree to leave to the complete discretion of the employer what the wages for the union members would be. While it is not out of the question that the Association for some reason wanted the contract in place before the UNMPact was adopted and was willing to assume the risk that the UNMPact might not contain what the police officers were promised, in this case I do not see that risky judgment as a barrier to overcoming immunity- {56} In my view, we have little alternative than to affirm the trial court’s determination that immunity cannot be successfully asserted in this ease. There exists a valid, written underlying contract. It incorporates the UNMPact. The court determined that the University promised that a specific process and formula would be employed to arrive at a wage to be placed in the UNMPact. The court found that the University failed to abide by the promises. The bargaining process involved not only the Association’s agreement but member adoption based on the University’s promises. I find it very significant that it almost defies common sense and is contrary to the nature of collective bargaining that the Association and its members would agree to give the University complete discretion to choose a wage figure. Based on these observations alone, the employment contract must be considered ambiguous. It does not contravene precedent or statutory interpretation doctrine to construe the employment contract as ambiguous and to resort to meaning. It does no harm to the policy of immunity to enforce the University’s promises under these circumstances. {57} Thus, there exists no persuasive reason to bar use of contract interpretation tools to pry into why the UNMPact ended up differently than it would have had the University followed its promised process and formula. I doubt very much that the Legislature’s intent in enacting Section 37-l-23(A) could have been to bar claims for breach of contract under the circumstances in this case. I also doubt due to the unique facts and circumstances of this case that the result can be or ought to be considered an expansion or broadening of Section 37-l-23(A).  . Because the district court determined that what UNM stated was a promise to include the wage parity in the UNMPact, I ignore the averment that the statement was a promise only to recommend that the wages to be paid should be in parity.