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Baker v University of Alaska (05/04/2001) sp-5402
Baker v University of Alaska (05/04/2001) sp-5402
Notice: This opinion is subject to 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, phone
(907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
GRANT C. BAKER, )
) Supreme Court No. S-9108
Appellant, )
) Superior Court No.
v. ) 3AN-97-6059 CI
)
UNIVERSITY OF ALASKA, )
UNIVERSITY OF ALASKA )
FAIRBANKS, and FRANK WILLIAMS,) O P I N I O N
)
Appellees. ) [No. 5402 - May 4, 2001]
______________________________)
Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
Peter A. Michalski, Judge.
Appearances: Grant C. Baker, pro se,
Anchorage. Paul B. Eaglin, University of Alaska Office of the
General Counsel, Fairbanks, for Appellees.
Before: Matthews, Chief Justice, Eastaugh,
Bryner, and Carpeneti, Justices. [Fabe,
Justice, not participating.]
CARPENETI, Justice.
MATTHEWS, Chief Justice, dissenting.
I. INTRODUCTION
Grant Baker was unlawfully terminated from his non-
tenured engineering professorship at the University of Alaska,
Fairbanks (UAF) in 1993. After the superior court in Fairbanks
held that the termination violated Baker's contractual rights and
remanded the case to UAF for a damages determination, UAF
administratively awarded Baker $48,464 in damages. Baker, who had
by then moved to Anchorage, filed an appeal in the superior court
there. He argued that the award was inadequate and that the UAF
administrative process had been unfair. Baker also filed a plea
for relief from the requirement that he prepay the preparation
costs for the administrative record, arguing that protracted
litigation, ordinary living expenses, and the costs associated with
the termination made it impossible for him to prepay the costs of
preparing the record. The superior court rejected this plea and
dismissed his appeal for failure to prosecute. Because the
superior court erred in denying Baker's plea for relief, we reverse
the dismissal of his appeal.
II. FACTS AND PROCEEDINGS
Grant Baker was a non-tenured engineering professor at
the University of Alaska, Fairbanks. After the end of the spring
1993 semester, Baker went commercial fishing. Upon returning in
August, he found that the UAF administration had mailed him a
notice of non-retention that cited budget constraints as the reason
for his non-retention. Under the terms of Baker's contract, the
non-retention meant he would remain under contract for a terminal
year of employment, after which he would not be rehired. Baker
filed a grievance with UAF.
A UAF grievance council heard Baker's case despite an
opinion from the University of Alaska General Counsel's office that
it had no jurisdiction. The grievance council found in Baker's
favor and recommended that he be retained for at least another
academic year, that the dean consult with tenured faculty before
the non-retention of any other non-tenured faculty, and that
negative performance evaluations be removed from Baker's personnel
file. The UAF Interim Provost rejected the grievance council's
recommendations in whole, finding that Baker's contractual rights
were not violated by the non-retention. Baker then filed a lawsuit
in the superior court in Fairbanks. After significant pretrial
discovery had taken place, the superior court converted the lawsuit
to an administrative appeal in response to a motion by UAF.
The administrative appeal was fraught with problems
created by UAF. As the administrative agency, UAF was charged with
preparing and maintaining the administrative record. [Fn. 1]
Superior Court Judge Mary E. Greene found that UAF had failed to
follow the rules in doing so and rejected UAF's record in its
entirety. Judge Greene instead substituted a record prepared by
Baker and his attorney. The record preparation, and the motion
practice associated with it, substantially increased Baker's
litigation expenses.
Baker eventually prevailed before Judge Greene, who found
that his contractual rights had been violated because the non-
retention notice was untimely. Because a timely notice would have
forced UAF to utilize the formerly applicable grievance system,
Judge Greene held that Baker was entitled to a grievance proceeding
under the former system. Judge Greene then determined that Baker
was contractually entitled to at least one year of continuing
appointment and one year of terminal appointment and remanded the
case to UAF for a determination of damages.
On remand, UAF ruled that Baker was entitled to damages
for his salary (plus interest), retirement, benefits, and his
moving expenses. UAF denied Baker's other claims of damages.
Baker appealed the UAF administrative decision to the
superior court in Anchorage. He argued that the amount of damages
awarded was inadequate and that UAF's administrative process had
been unfair. Baker was initially represented by private counsel in
the appeal, but later represented himself when the litigation
exhausted his cash and credit. [Fn. 2]
After several months of various motions regarding the
record, Baker sought an indigency exception from the requirement
that he prepay the costs of preparing the administrative record for
the appeal. Despite UAF's failure to rebut any of the factual
assertions of Baker's indigency affidavit, the superior court
denied his motion. Baker's appeal was then dismissed for lack of
prosecution based on his failure to pay for and provide the
administrative record. The superior court also awarded $15,000 in
attorney's fees to UAF. Baker appeals.
III. STANDARD OF REVIEW
We ordinarily review the dismissal of an administrative
appeal for failure to prosecute under the abuse of discretion
standard. [Fn. 3] This case, however, requires an examination of
Alaska Rule of Appellate Procedure 604(b)(1)(B)(iv). When
interpreting an appellate rule of court, we exercise our
independent judgment [Fn. 4] and "adopt the rule of law that is
most persuasive in light of precedent, reason, and policy." [Fn. 5]
IV. DISCUSSION
The Superior Court Erred in Dismissing Baker's Appeal for
Failure to Prosecute.
The superior court dismissed Baker's appeal for failure
to prosecute under Appellate Rule 511.5 because he did not prepay
UAF for the costs of preparing the administrative transcript and
record for appeal, as required by Appellate Rule 604(b)(1)(B)(iv).
The question before us is whether the superior court should have
accommodated Baker's requests for relief from this prepayment
requirement. We emphasize that this case does not require us to
determine whether Baker should be absolved of his duty to pay for
preparing the record and transcript, just whether he must pay in
advance.
1. Appellate Rule 604(b)(1)(B)(iv) ordinarily requires
advance payment for preparation of the administrative record, but
does not provide a standard for relieving the appellant from this
requirement.
Baker contends that the superior court erred by not
relieving him of the prepayment requirement when he made a factual
showing of indigence. But Appellate Rule 604(b)(1)(B)(iv) does not
provide a standard or test for the superior court to apply when it
considers motions for hardship relief; instead, it establishes that
the appellant shall pay transcript and file preparation costs and
may be required to make advance payment:
In the absence of an agreement between the
parties or an order of the court to the
contrary, all reasonable costs incurred in connection with
preparing the transcript and the court's copy of the agency file
shall be borne by the appellant. The preparing agency may require
advance payment of the costs as reasonably estimated by the
agency.[ [Fn. 6]]
Nothing in this rule suggests that a court's discretion to relax
the rule's advance payment requirement hinges on a strict showing
of indigence. The rule recognizes general judicial authority to
enter an order "to the contrary" of the usual advance payment
arrangement, and places no restrictions on the court's power to
exercise that authority. This vests the superior court with broad
discretion to grant relief upon a showing of any good reason to
avoid rigidly enforcing the advance payment requirement. While
indigence is certainly sufficient for relief, it is not in all
cases necessary.
2. Appellate Rule 604(b)(1)(B)(iv) allows the superior
court to deviate from ordinary procedure upon a showing of good
cause.
Appellate Rule 604(b)(1)(B)(iv) does not mention
indigence, or any other substantive factor, in granting discretion
to the superior court to issue an order relieving an appellant from
the prepayment requirement. But we have recently reaffirmed the
principle that "the size of a party's bank account" [Fn. 7] should
not "foreclose [that] party's opportunity to be heard." [Fn. 8]
Accordingly, we interpret Rule 604(b)(1)(B)(iv) to allow a superior
court to relieve the appellant of the prepayment requirement for
good cause. [Fn. 9] Good cause in this context consists of a
factual showing by the appellant of a substantial hardship. We now
turn to the specific circumstances of Baker's case.
3. Baker showed the existence of substantial hardship
sufficient to support relief from the Rule 604(b)(1)(B)(iv)
prepayment requirement.
Based on our interpretation of Rule 604(b)(1)(B)(iv), we
conclude that Baker has shown the existence of substantial hardship
that is sufficient to support a grant of relief from prepayment.
First, Baker was illegally terminated. No one now
disputes the illegality of UAF's conduct that instigated these
proceedings.
Second, UAF's conduct in the first administrative appeal
caused a substantial increase in Baker's litigation expenses. UAF
failed to follow its own rules on record preparation, resulting in
the superior court's rejection of UAF's record in its entirety and
the substitution of a record prepared by Baker and his attorney at
substantial additional expense to Baker.
Third, Baker's case cost him more in attorney's fees
(over $50,000) than he was paid in damages ($48,464). [Fn. 10]
Fourth, by the time Baker's second administrative appeal
was underway, he had incurred a debt that precluded his ability to
secure loans to cover his expenses. Also, his expenses often
exceeded his income. These expenses were not frivolous: they were
incurred, for the most part, in moving his family from Fairbanks to
Anchorage to obtain employment following his illegal termination in
Fairbanks and to cover the costs of this litigation.
And fifth, Baker was a University of Alaska employee.
Given the relationship between the parties in this case, it is
reasonable to conclude that had the court relieved Baker of the
prepayment requirement, UAF was in a position to protect itself in
terms of recovering the costs of record preparation in the event
UAF prevailed in the dispute.
These circumstances establish good cause to grant Baker
relief. His affidavit showing inability to raise the $3,500
necessary to pre-pay the record preparation costs, the submission
of a financial statement consistent with that affidavit, and the
failure of UAF to refute the existence of substantial hardship lead
to our conclusion today that relief from prepayment should have
been granted. The superior court focused only on Baker's income
and did not consider other relevant factors in making its
determination. Consideration of all relevant factors leads us to
conclude that Baker showed that substantial financial hardship
precluded his pre-payment of record preparation costs, and that the
university did not rebut that showing.
UAF argues that our holding in Jordan v. Jordan [Fn. 11]
controls in this case. But UAF misconstrues the facts and holding
of Jordan. Unlike the appellant in Jordan, Baker did not ask that
the state pay for an attorney or other litigation costs. Baker
merely sought relief from the requirement that he prepay record
preparation costs. In Jordan, we concluded that the appellant was
not indigent because "the Jordans had $200,000 to $300,000 in
marital assets" and that "sufficient assets existed for [him] to
pay for an attorney without encumbering the family home." [Fn. 12]
By contrast, the Baker family had a greater amount of debt than
assets, and no non-essential assets that could be encumbered or
liquidated to pay litigation costs. More importantly, Baker
appears to have had necessary monthly expenses that were at least
equal to, and at times exceeded, his family's monthly income.
Finally, Baker was unable to secure private lines of credit. These
facts distinguish Baker's situation from the facts underlying our
holding in Jordan. Accordingly, Jordan does not control Baker's
request for hardship relief.
The superior court failed to consider indicators of
substantial hardship other than Baker's salary. Record evidence
shows that Baker faced substantial financial hardship. The
superior court erred in finding he was not entitled to relief from
the requirement that record preparation costs be prepaid. [Fn. 13]
V. CONCLUSION
The superior court improperly denied Baker relief from
the administrative record preparation prepayment requirement of
Appellate Rule 604(b)(1)(B)(iv), which led to the dismissal of
Baker's appeal without addressing the merits. Because the superior
court erred in this regard, we REVERSE and REMAND for proceedings
on the merits.
MATTHEWS, Chief Justice, dissenting.
Grant Baker filed this administrative appeal on August
11, 1997. On August 14, 1997, he was notified that he would be
liable for record preparation costs and that the University could
require the prepayment of the costs. The costs amounted to some
$3,500. Some weeks later he received a lump sum settlement of
approximately $48,000 from the University. This was in addition to
his regular annual salary of more than $50,000.
Baker's obligation to prepay record preparation costs was
actively litigated. Baker's counsel filed many pleadings on this
subject and the superior court made three separate rulings -- on
May 20, June 23, and September 15, 1998, all affirming that Baker
had the obligation to prepay record preparation costs. After his
attorney withdrew in October of 1998, Baker made still another
motion seeking waiver of his prepayment obligation. This was
denied on December 1, 1998. Finally, on March 17, 1999, the
superior court entered an order giving Baker ten days more to
prepay the costs. This order warned Baker that if the costs were
not paid by then an order of dismissal would be entered. Baker did
not pay the costs and on April 21, 1999, the court dismissed the
appeal in a five-page order explaining the history of this case.
In my opinion the court did not abuse its discretion in
declining to relieve Baker of his obligation to prepay costs. The
record shows that Baker had adequate income to prepay $3,500 in
record preparation costs. He received income of more than $120,000
during the pendency of his appeal in the superior court. Further,
he had adequate time to budget for the payment of the costs. More
than eighteen months elapsed from the time he was first notified of
his obligation to pay until the appeal was dismissed. His
nonpayment seems to have resulted from choices he made that were
not spurred by strict economic necessity. He decided to pay to
litigate whether he had an obligation to prepay, rather than simply
to prepay. And he decided to use the $48,000 lump sum which he
received during the pendency of the appeal to pay counsel and
reduce the debt on his credit cards. [Fn. 1] Both Baker and his
attorney knew that he would have to prepay record preparation
costs and he could easily have set aside funds for this purpose
from the lump sum payment.
One measure of the substantial financial hardship which
will entitle a litigant to relief because of inability to pay the
normal costs of litigation is contained in Criminal Rule 39.1.
Defendants accused of crime are eligible for court-appointed
counsel if their total financial resources are not sufficient to
pay for counsel after "allowable household expenses" are deducted.
[Fn. 2] Courts are authorized to assume that "allowable household
expenses" are approximately equal to the adjusted federal poverty
guidelines for the defendant's household. [Fn. 3] For a family of
five -- Baker's family size -- living in Anchorage, this figure is
$24,400. [Fn. 4] Baker has annual financial resources far
exceeding this amount. And Baker is pursuing a civil action for
his personal financial benefit. It is hard to see why he should be
entitled to a more relaxed standard of financial hardship than
those accused of crime.
For the above reasons, I would hold that the superior
court did not abuse its discretion in declining to relieve Baker of
his obligation to pay in advance for the preparation of the
administrative record.
FOOTNOTES
Footnote 1:
See Alaska R. App. P. 604(b)(1).
Footnote 2:
Baker affied that he incurred attorney's fees and costs of
approximately $50,000, of which $15,000 remained unpaid when he
asked the superior court for relief from the prepayment
requirement.
Footnote 3:
Appellate Rule 511.5 allows an administrative appeal to be
dismissed for failure to prosecute. See Geczy v. State, Dep't of
Natural Resources, 924 P.2d 103, 104 (Alaska 1996) (citing Cowitz
v. Alaska Workers' Comp. Bd., 721 P.2d 635, 638 n.2 (Alaska 1986)).
Footnote 4:
Cf. Ford v. Municipality of Anchorage, 813 P.2d 654, 655
(Alaska 1991) (holding that in cases that "involve the
interpretation of a civil rule, we exercise our independent
judgment").
Footnote 5:
Guin v. Ha, 591 P.2d 1281, 1284 n.6 (Alaska 1979).
Footnote 6:
Alaska R. App. P. 604(b)(1)(B)(iv).
Footnote 7:
Peter v. Progressive Corp., 986 P.2d 865, 872 (Alaska 1999)
(examining potential litigation-precluding effect of appointing
expensive discovery master in litigation involving plaintiffs of
"modest means" (quoting Malvo v. J.C. Penney Co., 512 P.2d 575, 587
(Alaska 1973))).
Footnote 8:
Id. at 873 (quoting Malvo, 512 P.2d at 587).
Footnote 9:
We decide only that the circumstances of this case warrant
relief from prepayment, not from the underlying obligation to pay
the cost of record preparation under Rule 604. Accordingly,
criminal indigency standards relied on by the dissent are of
limited relevance to this case. Additionally, Baker was charged
with no crime; he was defending his rights as an employee who had
been wrongfully terminated and who, as a result, incurred
substantial financial hardship warranting relief from prepayment.
Footnote 10:
Baker was certainly entitled to hire and pay for an attorney
to help him defend his rights as an employee; he was clearly harmed
by UAF's illegal conduct. Also, contrary to the dissent's
assertion, he may not have had much choice as to whether he could
set aside funds for the record preparation instead of paying his
attorney's fees. Those fees may have been subject to an attorney's
lien under AS 34.35.430.
Footnote 11:
983 P.2d 1258 (Alaska 1999).
Footnote 12:
Id. at 1263.
Footnote 13:
Since we remand to the superior court for an appeal on the
merits based solely on the failure to grant relief from the
prepayment requirement, we do not reach the other issues presented
by Baker.
FOOTNOTES (Dissent)
Footnote 1:
The record does not reveal how the $48,000 was allocated as
between attorney's fees and costs and credit card debt. But in
March of 1998, after the $48,000 payment had been spent, Baker
filed an affidavit indicating that total attorney's fees and costs
incurred were approximately $50,000, and of this sum about $15,000
remained unpaid. This indicates that no more than $35,000 of the
$48,000 was paid to Baker's attorney, and that at least $13,000 was
available to meet other obligations.
Footnote 2:
See Alaska R. Crim. P. 39.1(b)(1).
Footnote 3:
See Alaska R. Crim. P. 39.1(h)(2).
Footnote 4:
See Admin. Bulletin 65.
