Phx. Law Enf't Ass'n v. City of Phx.

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PHOENIX LAW ENFORCEMENT ASSOCIATION, et al., Plaintiffs/Appellants, v. CITY OF PHOENIX et al., Defendants/Appellees.

No. 1 CA-CV 23-0454

Court of Appeals of Arizona, First Division

August 27, 2024

Not for Publication - Rule 111(c), Rules of the Arizona Supreme Court

Appeal from the Superior Court in Maricopa County Nos CV2014-008711, CV2014-009114, CV2015-007714 The Honorable Jay R. Adleman, Judge AFFIRMED

Napier, Baillie, Wilson Bacon & Tallone PC, Phoenix

By Eric R. Wilson (argued), Michael Napier, Cassidy L. Bacon Juliana B. Tallone

Counsel for Plaintiffs/Appellants Phoenix Law Enforcement Association

Yen Pilch Robaina & Kresin, PLC, Phoenix

By Caroline A. Pilch (argued), Robert E. Yen

Counsel for Plaintiffs/Appellants Theresa Clark, et al.

Sherman & Howard L.L.C., Phoenix

By Matthew A. Hesketh (argued), John A. Doran, Carli J. Simkin

Counsel for Defendants/Appellees

Judge Brian Y. Furuya delivered the decision of the Court, in which Presiding Judge Anni Hill Foster and Vice Chief Judge Randall M. Howe joined.

MEMORANDUM DECISION

FURUYA, JUDGE:

¶1 Plaintiffs Phoenix Law Enforcement Association ("PLEA plaintiffs"), et al., and plaintiffs Theresa Clark ("Clark plaintiffs"), et al., (collectively "Plaintiffs") appeal from the superior court's grant of summary judgment in favor of the City of Phoenix ("the City"). For the following reasons, we affirm.

FACTS AND PROCEDURAL HISTORY

¶2 Phoenix police officers are members of the Public Safety Personnel Retirement System ("PSPRS"). Under Arizona Revised Statute ("A.R.S.") § 38-842, a retiree's benefits are calculated in accordance with the "average monthly benefit compensation." The membership of the Phoenix Law Enforcement Association ("PLEA") consists of Phoenix police officers who have not been promoted to the rank of sergeant. Members of the Phoenix Police Sergeants and Lieutenants Association ("PPSLA") are supervisory officers.

¶3 The City and its officers engage in collective bargaining regarding employment and compensation. Phoenix City Code ("P.C.C.") §§ 2-209 to -235. Agreements with PLEA and PPSLA are delineated in a Memorandum of Understanding ("MOU") and a Memorandum of Agreement ("MOA") respectively. We refer to these agreements together as Collective Bargaining Agreements ("CBAs"). These CBAs are subject to periodic renegotiation between the City and the unions. See P.C.C. §§ 2209(4), -210(11), -223, -229. If the City and unions fail to reach an agreement during such negotiations, the City Council or Manager may impose terms based on "the interest of the public employees, public employer, and the public." P.C.C. § 2-219(J), (K). Further, each provision in a CBA constitutes a "mandatory subject of bargaining" and is subject to change or elimination during the collective bargaining process. P.C.C. § 2-215(A).

¶4 Historically, the CBAs contained wage enhancement provisions that allowed employees to increase their wages by converting vacation time, sick time, and uniform allowances into additional base salary, provided employees satisfied certain threshold requirements. An employee could elect to participate in any or all the wage enhancement provisions by submitting an election form. Each subsequent CBA renewed these provisions until 2014.

¶5 As relevant here, the 2012-2014 CBAs^[1] also included wage enhancement provisions as follows:

§ 3-1D, regarding uniform allowances:

[A] unit member may elect to have their basic annual uniform allowance converted to a bi-weekly payment for a consecutive three year period.... The consecutive 3 year period may be stopped and restarted one time for an additional three (3) year period up to a maximum total of six (6) years.

§ 3-4(B)(5), regarding sick leave benefits:

Once the employee elects to exercise this benefit, it must continue for the full three (3) consecutive year period. The employee may stop and restart this benefit one time without further qualification up to a maximum of a total of six (6) years.

§ 5-5(L), regarding vacation leave:

Once the election to exercise this benefit is made, it must continue for the full three consecutive-year period. The unit member may receive a one-time, one-year extension to the three-year period."

¶6 In 2014, before the 2012-2014 CBAs expired, the City began negotiating with PLEA and PPSLA on the terms of the next contracts. When negotiations failed to achieve a final agreement, the City imposed terms of employment that did not include any wage enhancement provisions. The PLEA plaintiffs and the Clark plaintiffs each sued the City to reinstate the wage enhancement provisions, arguing breach of contract and promissory estoppel. In 2016, Plaintiffs' claims were consolidated and later successfully obtained class certification. Phoenix L. Enf't Ass'n v. City of Phoenix, No. 1 CA-CV 19-0813, 2021 WL 1575782, at *2 ¶ 10 (Ariz. App. Apr. 22, 2021) (mem. decision).

¶7 Thereafter, the City moved for summary judgment on all claims. The PLEA plaintiffs moved for partial summary judgment on the breach of contract claim. The superior court granted the City summary judgment on all claims and denied the PLEA plaintiffs' motion. The court awarded the City $220,000 of attorneys' fees from the PLEA plaintiffs and $180,000 of attorneys' fees from the Clark plaintiffs. The awards reflected more than a 25% reduction in the amounts the City requested.

¶8 We have jurisdiction over Plaintiffs' timely appeal under Article 6, Section 9 of the Arizona Constitution and A.R.S. §§ 12-120.01(A)(1), -2101(A)(1).

DISCUSSION

¶9 We review the superior court's grant of summary judgment in favor of the City de novo, viewing the facts in the light most favorable to Plaintiffs. See Dinsmoor v. City of Phoenix, 251 Ariz. 370, 373 ¶ 13 (2021). "The court shall grant summary judgment if the moving party shows that there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law." Ariz. R. Civ. P. 56(a). Summary judgment must be granted if the facts produced in support of the nonmovant's claim "have so little probative value given the quantum of evidence required, that reasonable people could not agree with the conclusion advanced by the proponent of the claim." Rosenberg v. Sanders, 256 Ariz. 328, 332-33 ¶ 23 (2023) (quoting Orme Sch. v. Reeves, 166 Ariz. 301, 309 (1990)).

I. The City Did Not Breach the 2012-2014 CBAs by Eliminating the Wage Enhancement Provisions After Those CBAs Expired.

¶10 Plaintiffs argue the City breached the CBAs by eliminating wage enhancement provisions for employees who made a timely election during the 2012-2014 period.

A. We Are Not Bound by Previous Decisions and Rulings Because They Were Not Decided on the Merits.

¶11 As a preliminary matter, Plaintiffs argue that granting the City summary judgment contradicts previous judgments on the pleadings and this court's decision on class certification. They contend those decisions relied on the same essential facts and no new circumstance or change in the law occurred since then.

¶12 Courts are not bound by a prior decision if it "did not actually decide the issue." Flood Control Dist. v. Paloma Inv. Ltd. P'ship, 230 Ariz. 29, 40 ¶ 31 (App. 2012) (quotation omitted); see also Quinn v. Cardenas, 256 Ariz. 77, 82-83 ¶ 18 (App. 2023) (explaining final judgment is reviewed notwithstanding any contrary previous ruling). A motion for judgment on the pleadings "tests the sufficiency of the complaint," and the allegations must be taken as true. Garibay v. Johnson in & for Cnty. of Pima, 257 Ariz. 91, 95 ¶ 5 (App. 2024) (quoting Giles v. Hill Lewis Marce, 195 Ariz. 358, 359 ¶ 2 (App. 1999)). Class certification requires analysis of the individuals of the proposed class, the types of claims, the relationship between the relief sought and the proposed class, and procedural concerns-not the merits of the case. See generally Ariz. R. Civ. P. 23. Summary judgment, however, requires finding "there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law." Ariz. R. Civ. P. 56(a).

¶13 Therefore, the standard for surviving summary judgment is different than judgment on the pleadings or class certification. Compare Ariz. R. Civ. P. 12(b) with 56(a) and 23. Because prior decisions rendered in the history of this consolidated case did not "actually decide the issue" on the merits, they have no bearing on whether summary judgment was proper. See Flood Control Dist., 230 Ariz. at 40 ¶ 31.

B. The Wage Enhancement Provisions Expired with the 20122014 CBAs.

¶14 Plaintiffs argue the wage enhancement provisions survived the expiration of the CBAs because the parties' intent and principles of contract interpretation suggest those provisions were intended to outlast the main agreements.

¶15 We interpret collective bargaining agreements under ordinary contract principles. See M &G Polymers USA, LLC v. Tackett, 574 U.S. 427, 435 (2015); see also Cheatham v. DiCiccio, 240 Ariz. 314, 323 ¶ 38 (2016) (explaining collective bargaining agreements are like other contracts). Contract interpretation is a question of law we review de novo. Benson v. Casa De Capri Enters., LLC, 252 Ariz. 303, 306 ¶ 9 (2022). When interpreting contract terms, we seek to identify and enforce the parties' intent. Terrell v. Torres, 248 Ariz. 47, 49 ¶ 14 (2020). In so doing, we construe the provisions "according to their plain and ordinary meaning." First Am. Title Ins. Co. v. Johnson Bank, 239 Ariz. 348, 350 ¶ 8 (2016). In approaching the text, "we attempt to reconcile and give effect to all terms of the contract to avoid any term being rendered superfluous." Terrell, 248 Ariz. at 49 ¶ 14.

1. The Durational Clauses of the CBAs Apply to the Wage...