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Foster v City of Fairbanks (12/27/96), 929 P 2d 658
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Notice: This opinion is subject to formal correction before
publication in the Pacific Reporter. Readers are requested to bring
errors to the attention of the Clerk of the Appellate Courts, 303 K
Street, Anchorage, Alaska 99501, telephone (907) 264-0607, fax (907)
264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
KAYLE FOSTER, )
) Supreme Court No. S-6933
Appellant, )
) Superior Court No.
) 4FA-93-03010 CI
v. )
) O P I N I O N
CITY OF FAIRBANKS )
) [No. 4455 - December 27, 1996]
Appellee. )
______________________________)
Appeal from the Superior Court of the State of
Alaska, Fourth Judicial District, Fairbanks,
Ralph R. Beistline, Judge.
Appearances: Brett M. Wood, Fairbanks, for
Appellant. John M. Eberhart, Deputy City
Attorney, and Herbert P. Kuss, City Attorney,
Fairbanks, for Appellee.
Before: Compton, Chief Justice, Rabinowitz,
Matthews, Eastaugh, and Fabe, Justices.
FABE, Justice.
I. INTRODUCTION
Kayle Foster challenged the City of Fairbanks'
interpretation of an arbitration award. She appeals from the
superior court's order of summary judgment against her, claiming
that the court should have remanded or vacated the arbitrator's
award because it was ambiguous or grossly erroneous. We affirm the
superior court's decision.
II. FACTS AND PROCEEDINGS
On November 27, 1989, the City of Fairbanks (the City)
notified Kayle Foster that it intended to lay her off on January 1,
1990. Foster had worked as a fire inspector for the City's fire
department since 1981. She earned approximately $61,700 per year
plus benefits.
On January 1, 1990, the City laid off its seven least
senior fire department employees, consisting of three fire
fighters, a paramedic, a secretary, a clerk, and Foster. The City
characterized the layoffs as motivated by fiscal pressure.
The Fairbanks Fire Fighters Association (the Association)
challenged the layoffs in a grievance filed on January 10, 1990.
The Association demanded "the immediate return of these individuals
to their positions . . . as well as compensation for the periods
they have been off work." The Association characterized the seven
layoffs as discrimination against the employees for their union
membership and as a ploy to avoid implementing a pay raise
scheduled to take effect in 1990.
Foster took a new job in Juneau soon after the layoff in
January 1990. In April 1990 the City recalled four of the seven
laid-off employees, including the three fire fighters and the
paramedic. The clerk and the secretary retired, although the clerk
claimed she was forced to retire. Subsequently, the fire
department deleted the positions formerly held by the clerk and
Foster. The Association did not object to the deletions. On April
12, 1990, the City (through the Association) offered the
secretary's former job to Foster. This position paid $25,000 less
than Foster's former position as a fire inspector. Foster could
not accept such a pay cut. She rejected the offer and remained in
Juneau.
In 1993 the Association's January 1990 grievance reached
arbitration under the labor agreement between the Association and
the City. The Association stated in its prehearing memorandum that
"[t]he seven affected employees were offered their jobs back on
April 10, 1993 [sic]. (EN1) However, only four of the seven
accepted." Although the original grievance had demanded
reinstatement of the employees, the prehearing memorandum requested
only "compensation for the period of work off."
The arbitrator, William Erwin, found that the City's
fiscal explanation for the layoffs was pretextual, that the City
laid off its employees as a negotiating ploy, and, therefore, that
the City had violated the collective bargaining agreement. Based
on the Association's representations in its prehearing memorandum,
the arbitrator found that in April 1990 all seven employees had
been "called to return to work"and that four had returned, but the
other three "had found other jobs and declined to return to City
employment." Therefore, he ordered the City to pay the seven laid-
off employees back salary and benefits from January 1, 1990 "to the
day all were recalled."(EN2)
The City interpreted the arbitrator's award as meaning
that it owed Foster approximately $38,000 as compensation for the
period from January 1, 1990 to April 1990, when the City offered
her a secretarial position. Foster disagrees. Because she was
offered only a secretarial position, she interpreted the award as
entitling her to an offer to return to her old position as a fire
inspector, (EN3) and to full pay between January 1, 1990 and the
future date when the City makes that offer.
Foster accepted $38,005.85 from the City, under the
mutual understanding that she disputed whether the sum served as
complete satisfaction of her claim. She brought suit in the
superior court, seeking declaratory judgment implementing one of
two remedies: (1) restoration to her former position with
compensation for lost wages during the interval or (2) remand to
the arbitrator for clarification because his decision was ambiguous
or incomplete.
The parties stipulated that the case could be resolved by
cross-motions for summary judgment. In its decision, the superior
court cited extensive authority outlining Alaska's policy of
deference toward arbitration results. The court presumed "that the
parties presented the best case at the time of arbitration"and
found that the Association had asked only for back pay and
benefits, not for Foster's reinstatement. Finding that the
arbitrator's award was neither ambiguous, as its "true intent"was
apparent, nor grossly erroneous, the court entered summary judgment
in favor of the City. Foster appeals.
III. DISCUSSION (EN4)
Foster makes only one legal argument on appeal: that the
award was ambiguous and should be remanded for clarification. In
her statement of facts, Foster also asserts in passing that the
arbitrator "committed a gross error." We consider both claims.
AA. The Award Was Not Ambiguous.
Foster contends that the award was ambiguous because it
can reasonably support two interpretations: hers and the City's.
In response, the City argues that the award unambiguously gave
Foster back pay for the period between January and April 1990.
Alaska law accords great deference to arbitrators'
findings. Ahtna, Inc. v. Ebasco Constructors, Inc., 894 P.2d 657,
660 (Alaska 1995). However courts may, and should, remand to an
arbitrator where the award is "patently ambiguous." International
Bhd. of Elec. Workers, Local Union 1547 v. City of Ketchikan, 805
P.2d 340, 344 (Alaska 1991). Alaska heeds the common law that
federal courts have developed on remanding arbitrators' awards for
ambiguity. Id. at 343-44.
The reason for the practice of remanding is that "[a]n
ambiguous award should be remanded to the arbitrators so that the
court will know exactly what it is being asked to enforce."
Americas Ins. Co. v. Seagull Compania Naviera, S.A., 774 F.2d 64,
67 (2d Cir. 1985) (citing Cleveland Paper Handlers & Sheet
Straighteners Union No. 11 v. E.W. Scripps Co., 681 F.2d 457, 460
(6th Cir. 1982) (per curiam) and Oil, Chemical & Atomic Workers
Int'l Union, Local 4-367 v. Rohm & Haas, Texas, Inc., 677 F.2d 492,
495 (5th Cir. 1982) (per curiam)). When possible, however, courts
should avoid remanding on the basis of ambiguity "because of the
interest in prompt and final arbitration." Teamsters Local No. 579
v. B & M Transit, Inc., 882 F.2d 274, 278 (7th Cir. 1989).
Foster's argument that ambiguity means "subject to two
reasonably different interpretations"is incorrect for two reasons.
First, that definition is derived from the law of contracts, not
arbitration. Second, that definition is the standard for ambiguity
rather than "patent"ambiguity, which was the focus of our analysis
in International Brotherhood of Electrical Workers, 805 P.2d at
344. Because of the policy of respect for arbitrators' awards,
courts should find ambiguity in an arbitrator's award less readily
than in a contract. Patent ambiguity does not exist where the
arbitrator's "true intent"is apparent. Id. A court may rely on
the context created by the record to resolve a potential ambiguity.
Teamsters Local No. 579, 882 F.2d at 278.
In an illustrative case, an arbitrator ordered a hotel to
"reinstate"fired housekeepers "to their former employment."
United Steelworkers of America, Dist. 36, Local 8249 v. Adbill
Management Corp., 754 F.2d 138, 140 (3d Cir. 1985). The hotel
restored the housekeepers to the payroll but immediately placed
them on "indefinite layoffs"because of the hotel's low occupancy.
Id. A trial court remanded the case to the arbitrator to determine
whether the hotel's action complied with the order. Id. The U.S.
Court of Appeals for the Third Circuit reversed, holding that the
award was unambiguous because "reinstate[] . . . to their former
employment"indicated the arbitrator's intent to require the hotel
to return the housekeepers to active duty. Id. at 141-42.
Similarly, in Zephyros Maritime Agencies, Inc. v.
Mexicana de Cobre, S.A., 662 F. Supp. 892 (S.D.N.Y. 1987), a court
determined an arbitral award to be unambiguous where the award
stated that "interest shall resume"in thirty days if one party did
not make payment. Id. at 894. The court found that the word
"resume"indicated the arbitrator's intent to suspend interest
during the thirty-day period. Id. at 894-95.
In light of this authority, we conclude that in this case
the arbitrator's findings and award were unambiguous. The order
that the City must pay salaries and benefits "to the day all were
recalled"is clear in the context of the arbitrator's factual
findings that all seven employees were recalled to their jobs in
April 1990 and that three employees declined to take the offered
recall. The arbitrator's clear intent was to award Foster back pay
for the period from January to April 1990. Neither the possibility
of an unintended alternative interpretation of the award nor the
fact that the arbitrator believed that the Association had recalled
Foster to her former position renders the award patently ambiguous.
B. Foster Is Estopped from Successfully Challenging the
Award Based on the Arbitrator's Erroneous Belief that She
Had Been Recalled.
Foster alleges in passing that the arbitrator's decision
was erroneous because it was based "without any evidentiary
support"on the false premise that Foster was recalled to her
former position. However, we conclude that Foster is estopped from
challenging the award based upon the arabitrator's incorrect
factual determination because neither Foster nor the Association
offered evidence during the arbitration that reasonably could have
caused the arbitrator to find otherwise. Indeed, the Association
actively encouraged the arbitrator to believe that Foster had been
recalled. (EN5) For example, the Association informed the
arbitrator in its prehearing memorandum that Foster was offered her
job back. Foster did not testify at the arbitration hearing, so
she did not correct this mistake. In fact, her attorney, who
signed the Association's prehearing memorandum to the arbitrator
stating that Foster was recalled, concedes that he never corrected
the mistake: "the arbitrator did not hear evidence that . . .
[Foster] . . . was never offered a recall to her prior position."
The calculations of the total award presented to the
arbitrator by Foster's attorney provide further evidence that the
Association took the position in arbitration that Foster had been
recalled. Before arbitration, the Association demanded
approximately $294,000: $220,000 in principal (back pay for all
seven employees) plus $74,000 in interest, which accrued "from the
time the affected employees either returned to work or were
eligible to return to work." After the arbitrator's decision, the
Association calculated the award as the same amount: approximately
$294,000, consisting of $220,000 in principal plus approximately
$74,000 in interest "accruing at the rate of $63.28 per day since
May 1, 1990, . . . as of July 1, 1993." These statements indicate
that during and immediately after the arbitration, the Association
failed to demand continuing back wages for Foster; according to the
Association's calculation, the City's only continuing obligation
after April or May 1990 was interest. Only in August 1993, nearly
one month after the decision, did the Association say that "upon
further consideration"the figure "should be adjusted substantially
upward"because Foster was never recalled.
IV. CONCLUSION
We AFFIRM the superior court's decision. We conclude
that the superior court correctly determined that it should not
remand the arbitrator's award for ambiguity. Furthermore, because
Foster and the Association actively encouraged the arbitrator to
believe that she had been recalled, she is estopped from appealing
that error.
ENDNOTES:
1. The four fire fighters were recalled in April 1990, not 1993.
2. Due to the Association's assertion that Foster was recalled to
her former job, the arbitrator apparently believed that all seven
employees were recalled on April 10, 1990. Therefore, the intent
of his order was to reimburse all seven employees for the
approximately four-month period during which they were laid off.
3. Foster says that today she would no longer accept her old job
back. Nevertheless, she insists that the City should offer it to
her.
4. "When reviewing a grant of summary judgment, this court 'must
determine whether there was a genuine issue of material fact and
whether the moving party was entitled to judgment on the law
applicable to the established facts.' All reasonable inferences of
fact from proffered materials must be drawn against . . . the
moving party, and in favor of . . . the non-moving party." Zeman
v. Lufthansa German Airlines, 699 P.2d 1274, 1280 (Alaska 1985)
(citation omitted).
5. We have also recognized that a party may not successfully
appeal an error if that party invited the error. Aviation Assocs.,
Ltd. v. Temsco Helicopters, Inc., 881 P.2d 1127, 1131-32 (Alaska
1994); Geolar, Inc. v. Gilbert/Commonwealth, Inc., 874 P.2d 937,
948 (Alaska 1994) (finding that a party could not claim that
certain evidence had prejudiced the jury where that party not only
failed to object to the evidence at trial but also initially
brought the evidence to the attention of the jury).
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