TERRI M. SANDERS, Plaintiff-Respondent-Cross Appellant,
BOARD OF TRUSTEES OF THE MOUNTAIN HOME SCHOOL DISTRICT NO. 193, Defendant-Appellant-Cross Respondent
2014 Opinion No. 43
Appeal from the District Court of the Fourth Judicial District, State of Idaho, Elmore County. Hon. Lynn G. Norton, District Judge.
Anderson, Julian & Hull, LLP, Boise, for appellant. Brian K. Julian argued.
Herzfeld & Piotrowski, Boise, & Paul J. Stark, Idaho Education Association, Boise, for respondent. James Piotrowski argued.
BURDICK, Chief Justice. Justices EISMANN, J. JONES, W. JONES and HORTON CONCUR.
[156 Idaho 270] BURDICK, Chief Justice.
The Board of Trustees of the Mountain Home School District No. 193 (" Board" ) appeals the district court's denial of the Board's request for attorney fees. This case arose when School District employee Terri Sanders claimed that the Board breached its contract with her by hiring a candidate less qualified than her for a teaching position that Sanders had also applied for. After a jury found the Board did not breach its contract, the district court held the Board was not entitled to attorney fees under I.C. § 12-117 because Sanders presented a legitimate issue for trial. The court also held that because I.C. § 12-117 was the exclusive source of attorney fees for a school district, I.C. § 12-120(3) could not apply. The court awarded the Board arbitration costs as discretionary costs.
The Board argues that I.C. § 12-117 is not the exclusive source of attorney fees to a school district and the Board can recover attorney fees under I.C. § 12-120(3), as the suit was based on a commercial transaction. Sanders cross-appeals, arguing that the district court should not have awarded arbitration costs incurred in a non-binding proceeding that was required by a contract between the parties. We reverse the district court's denial of attorney fees and remand with instructions for the district court to award fees to the Board and calculate reasonable attorney fees under I.C. § 12-120(3). On the cross-appeal we vacate the district court's award of arbitration costs as discretionary costs.
I. FACTUAL AND PROCEDURAL BACKGROUND
Terri Sanders taught in the Mountain Home School District (" District" ) for about twenty-three years when, in May 2008, a consulting teacher position opened in the District. Sanders applied. The District interviewed four candidates, scoring them based on seniority and the results of a panel interview. The District awarded the position to another candidate.
Sanders filed multiple grievances over the District's failure to award her the position. Sanders had an individual teaching contract with the District, which incorporated all relevant terms from a Master Contract between the Mountain Home Education Association and the District. The Master Contract provided a grievance procedure to resolve disputes between teachers and the District. Each grievance that Sanders filed was denied. The final level of grievance under the Master Contract was non-binding arbitration. The arbitrator ruled for Sanders, holding a contractual breach occurred when the person appointed as consulting teacher did not have the minimum qualifications stated in the job announcement. The Board rejected the arbitrator's report and sent Sanders a letter explaining that it would not follow that report.
Sanders then sued the Board for breach of contract. She claimed that the breach occurred when the District hired a less qualified candidate for the consulting teacher position. After trial, a jury concluded that the Board did not breach Sanders's contract. The Board then petitioned for attorney fees and costs under I.C. § § 12-117, 12-121, and 12-120(3).
The district court granted partial costs, but did not award attorney fees. The court determined that fees were only available to the Board under I.C. § 12-117 because recent precedent held that I.C. § 12-117 was the exclusive source of attorney fees for the entities to which it applies. The district court then concluded that the Board was not ...