                                                                                  December 3 2013


                                         DA 13-0307

               IN THE SUPREME COURT OF THE STATE OF MONTANA
                                         2013 MT 358



SHERRI ROBERTS,

              Plaintiff and Appellant,

         v.

LAME DEER PUBLIC SCHOOL DISTRICT #6,
Rosebud County,

              Defendant and Appellee.



APPEAL FROM:          District Court of the Sixteenth Judicial District,
                      In and For the County of Rosebud, Cause No. DV 2010-64
                      Honorable George Huss, Presiding Judge


COUNSEL OF RECORD:

               For Appellant:

                      Richard O. Harkins; Attorney at Law; Ekalaka, Montana

               For Appellee:

                      Jeff A. Weldon; Felt, Martin, Frazier & Weldon, P.C.;
                      Billings, Montana



                                                 Submitted on Briefs: October 30, 2013
                                                            Decided: December 3, 2013


Filed:

                      __________________________________________
                                       Clerk
Justice Patricia Cotter delivered the Opinion of the Court.

¶1     Sherri Roberts (Roberts) appeals from an order of the Sixteenth Judicial District

Court, Rosebud County, denying her petition to have an arbitration award vacated,

modified, or corrected. We affirm.

                                          ISSUE

¶2     The dispositive issue on appeal is whether the District Court’s refusal to vacate,

modify, or correct the arbitration award was an abuse of discretion.

                                     BACKGROUND

¶3     Beginning in the fall of 2005, Roberts was employed as a vocational agriculture

instructor at the Lame Deer High School. She also served as faculty adviser for the

school’s chapter of the National FFA Organization (formerly known as Future Farmers of

America). She was suspended with pay on August 12, 2009, and her employment was

terminated on November 16, 2009.          Roberts appealed her termination to binding

arbitration pursuant to the terms of a collective bargaining agreement between the Lame

Deer Education Association, MEA-MFT, of which Roberts was a member, and Lame

Deer School District No. 6 (School District). The parties selected Arbitrator Michael D.

McDowell (Arbitrator), and he conducted hearings on August 10, 11, and 13, 2010.

¶4     On November 13, 2010, the Arbitrator issued a decision denying Roberts’

grievance. The Arbitrator concluded that the School District had afforded Roberts due

process of law, the School District had good cause to discipline Roberts, and the

discipline of discharge should not be reduced. On December 20, 2010, Roberts filed a

petition to vacate, modify, or correct the arbitration award in the District Court. The

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District Court denied Roberts’ petition and upheld the arbitration award on April 1, 2013.

The District Court concluded that the Arbitrator had not exceeded his powers, and that

Roberts had failed to meet her statutory burden of proving that a ground for vacating,

correcting, or modifying the award existed. The District Court acknowledged Roberts’

argument that a different result could have been reached by the Arbitrator, but declined to

substitute its determination for that of the Arbitrator or to revisit the merits of the

controversy.

¶5     Roberts contends on appeal that the District Court abused its discretion in failing

to vacate or modify the award because the District Court did not carefully evaluate the

facts found by the Arbitrator and failed to “properly scrutinize all prior proceedings by

the sweeping determination that the arbitrators [sic] facts and findings were conclusive.”

Roberts argues that the School District fraudulently misled her, that her actions did not

constitute insubordination, and that the School District did not have good cause to

suspend her. She argues the suspension was based on an improper and illegal motive.

¶6     The School District counters that the District Court properly upheld the award

because Roberts failed to establish any of the limited grounds upon which modification

or correction may be premised under § 27-5-313(1), MCA, and failed to meet her burden

of proving a ground to vacate the award under § 27-5-312(1), MCA.

                              STANDARD OF REVIEW

¶7     Judicial review of an arbitration award is strictly limited by statute in Montana.

Colstrip Energy L.P. v. N.W. Corp., 2011 MT 99, ¶ 17, 360 Mont. 298, 253 P.3d 870

(internal citations omitted). When a matter has been submitted to binding arbitration,

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courts are not permitted to review the merits of the controversy, but may only confirm,

vacate, modify, or correct an arbitration award pursuant to §§ 27-5-311, -312, and -313,

MCA. Colstrip Energy, ¶ 17 (internal citations omitted). We review a trial court’s

decision to confirm an arbitration award to determine if the court abused its discretion.

The test for an abuse of discretion is whether the trial court acted arbitrarily, without

employment of conscientious judgment, or exceeded the bounds of reason resulting in

substantial injustice. Colstrip Energy, ¶ 18 (internal citations omitted). We can only

review whether the District Court abused its discretion in confirming the arbitration

award; we cannot review the merits of the controversy. Colstrip Energy, ¶ 19 (internal

citations omitted).

                                      DISCUSSION

¶8     Whether the District Court’s refusal to vacate, modify, or correct the arbitration

award was an abuse of discretion.

¶9     The party seeking to vacate, modify, or correct an arbitration award bears the

burden of proving that one of the statutorily enumerated grounds exists. Colstrip Energy,

¶ 17 (internal citations omitted).    Therefore, in order to trigger the District Court’s

authority to review the arbitration award, Roberts had to properly raise one of the specific

grounds set forth in §§ 27-5-312 or -313, MCA. While she couches her argument in the

language of § 27-5-312(1)(c) by claiming that “the arbitrator exceeded his powers,” what

she actually asks is that we reweigh the facts and the merits of the controversy.

¶10    Roberts presented the District Court with four grounds for vacating or modifying

the arbitration award:    (1) the Arbitrator exceeded his power in not following the

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collective bargaining agreement’s requirement that good cause exist before there may be

a suspension with or without pay; (2) the Arbitrator exceeded his power in allowing the

School District to consider alleged insubordination from before and after Roberts’

termination; (3) the Arbitrator exceeded his power by not differentiating between

Roberts’ teaching contract and her FFA advisor contract; and (4) the Arbitrator exceeded

his power in asserting that Roberts was in control of funds that belonged to the FFA when

she was only an advisor.

¶11   “An arbitrator exceeds his powers when he decides matters which were not

submitted to him.” Terra W. Townhomes, L.L.C. v. Stu Henkel Realty, 2000 MT 43, ¶ 27,

298 Mont. 344, 996 P.2d 866. Here, the parties agreed to the issues that would be

submitted to arbitration, namely whether Roberts was dismissed for good cause, and if

not, what the appropriate remedy was.      These were the only matters the Arbitrator

decided; thus, the District Court did not abuse its discretion by refusing to vacate or

modify the award on the basis that the Arbitrator had exceeded his powers.

¶12   Roberts contends that notice and a hearing were required before she could lawfully

be suspended. In Geissler v. Sanem, 285 Mont. 411, 416, 949 P.2d 234, 237-38 (1997),

we adopted the “manifest disregard of the law” standard of review for vacating

arbitration decisions. For reversal under this standard, an arbitrator must have been

aware of a clearly governing principle of Montana law, but “blatantly refused to follow

it.” Paulson v. Flathead Conserv. Dist., 2004 MT 136, ¶ 24, 321 Mont. 364, 91 P.3d 569

(internal citation omitted). The District Court determined Roberts failed to meet the

Geissler standard because she could not demonstrate a clearly governing principle in

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Montana law that suspensions with pay require prior notice and hearing. It naturally

follows that she failed to establish the two following requirements of Geissler, and thus,

the District Court did not abuse its discretion in declining to vacate the award under this

standard.

¶13    As for the factual grounds Roberts raised for modifying or vacating the arbitration

award, the District Court concluded that these had been considered and expressly

addressed by the Arbitrator, and that it was not the role of the court to substitute its

determination for that of the Arbitrator or to revisit the merits of the controversy. As the

District Court noted, modification or correction under § 27-5-313, MCA, was

inappropriate because Roberts “essentially seeks a reversal of the award, which clearly

would go to the merits of the decision rather than to matters of form.” The District Court

did not abuse its discretion in declining to revisit these issues. Requiring the District

Court to conduct its own evidentiary hearing on an issue previously submitted to and

determined in binding arbitration would undermine the finality and expediency provided

by arbitration. See Dick Anderson Constr., Inc. v. Monroe Constr. Co., LLC, 2009 MT

416, ¶ 38, 353 Mont. 534, 221 P.3d 675.

¶14    For the foregoing reasons, we conclude that the District Court did not abuse its

discretion in refusing to modify, correct, or vacate the Arbitrator’s award. We therefore

affirm the decision of the District Court.


                                                 /S/ PATRICIA COTTER




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We concur:


/S/ MIKE McGRATH
/S/ BETH BAKER
/S/ LAURIE McKINNON
/S/ JIM RICE




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