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Zeyen v. Pocatello/Chubbuck School District No. 25

Supreme Court of Idaho

October 23, 2019

MIKE ZEYEN, individually, and as a patron of Pocatello/Chubbuck School District #25 and, on behalf of and as Guardian Ad Litem of his minor children, Olivia Zeyen, Noah Zeyen and Ann Zeyen; RACHAEL BOOTH, individually, and as patron of Pocatello/Chubbuck School District #25 and, on behalf of and as Guardian Ad Litem of her minor children, Madison Booth and Braydon Booth, Plaintiffs-Appellants,
v.
POCATELLO/CHUBBUCK SCHOOL DISTRICT NO. 25, a municipal corporation of the State of Idaho, Defendant-Respondent.

          Appeal from the District Court of the Sixth Judicial District, State of Idaho, Bannock County. Robert C. Naftz, District Judge.

         District court decision on motion to certify and leave to amend, affirmed.

          Huntley Law Firm, PLLC, Boise and Wood Law Group, PC, Idaho Falls, for appellants. Theodore J. Wood argued.

          Anderson, Julian & Hull, LLP, Boise, for respondent. Brian K. Julian argued.

          BURDICK, CHIEF JUSTICE.

         This appeal arises from the Bannock County district court's order denying a motion for class certification and a motion for leave to amend the complaint. The named plaintiff ("Zeyen") seeks declaratory relief and recovery of damages from Pocatello/Chubbuck School District No. 25 on behalf of all students currently enrolled in the district and their guardians. Zeyen alleges that School District 25's practice of charging fees violates Article IX, section 1, of the Idaho Constitution (the "Education Article"). Zeyen first sought to certify the class to include all students within School District 25. Zeyen's later motion to amend sought to add a takings claim under both the Idaho and U.S. Constitutions. The district court denied Zeyen's motion for class certification based on lack of standing and denied his motion to amend both as untimely and prejudicial to School District 25. Zeyen timely appeals.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         In July 2016, Zeyen filed his original complaint on behalf of all K-12 school children in School District 25. Zeyen sought declaratory judgment that the fees imposed by School District 25 were "illegal and unconstitutional." Zeyen also requested the "reimbursement" or "refund" of the fees paid for the 2014-15 school year as well as the following years. Jurisdiction was proper, Zeyen contended, under the Education Article. Answering, School District 25 argued that jurisdiction should be under Idaho's Constitutionally Based Educational Claims Act ("Educational Claims Act" or "the Act") because the Education Article does not provide a private cause of action for damages. School District 25 also argued that Zeyen did not have standing and was not entitled to class certification. In November 2016, the court calendared the case for trial to take place in fall 2017 with motions to amend pleadings due on January 3, 2017.

         In October 2016, Zeyen moved for class certification. A decision on that motion was delayed after a few events altered the course of proceedings. First, School District 25 claimed it stopped charging fees that were associated with academic credit beginning with the 2016-17 school year. Second, Joki v. State was on appeal to this Court. 162 Idaho 5, 394 P.3d 48, 6 (2017). This Court heard oral argument in the Joki case in January 2017 and took the case under advisement. A short time after, Zeyen moved to suspend proceedings until this Court issued a decision in Joki. The district court granted Zeyen's motion and vacated the trial dates.

         This Court issued the Joki opinion in April 2017. Id. In August 2017, the district court held a status conference Shortly thereafter, Zeyen filed, and the district court granted, a motion for leave to amend his complaint The first amended complaint differed from the original complaint by asserting that Zeyen and the proposed class "have a right and standing to sue both as a constitutional claim under [the Education Article], and also, concurrently, as a claim under the Constitutionally Based Education Claims Act" based on this Court's decision in Joki.

         A few months later, in October 2017, Zeyen moved for leave to amend his complaint a second time to plead a violation of the takings clause. The proposed complaint contained additional references to the takings clause in the Idaho and U.S. Constitutions as well as 42 U.S.C. § 1983. In support of his motion, Zeyen argued that he had a viable claim for an unlawful taking under this Court's recent decision in Hill-Vu Mobile Home Park v. City of Pocatello, 162 Idaho 588, 591, 402 P.3d 1041, 1044 (2017). He also asserted that the Educational Claims Act could not limit his Constitutional claims.

         In January 2018, the district court heard argument on Zeyen's motion for leave to amend the First Amended Complaint and his motion to certify the class. The court orally denied the motion to amend the First Amended Complaint and took the class-certification issue under advisement. The court later issued an order denying the motion for class certification. In the accompanying memorandum decision, the court recited its reasoning for denying Zeyen's motion to amend the Amended Complaint, explaining that Zeyen's "undue delay" in asserting the takings claim would be "especially prejudicial" given "that discovery was concluded in accordance with the accelerated timeline" he had requested. As to class certification, the court ruled that Zeyen lacked standing to pursue the class action. The court determined that the Educational Claims Act provides the sole mechanism for Zeyen to acquire standing under the Education Article. Because the Educational Claims Act does not address past wrongs or individual damages, the court ruled that Zeyen failed the typicality requirement for class-action standing because he lacked a redressable injury required for individual standing.

         At Zeyen's request, the court certified the memorandum decision as a final appealable judgment under Rule 54(b) of the Idaho Rules of Civil Procedure, and Zeyen appealed. After his appeal was conditionally dismissed for lack of a partial judgment, the court entered a partial judgment denying the motion for class certification. This Court elected to treat the final partial judgment as a motion for permissive appeal and granted the motion.

         II. ISSUES ON APPEAL

         1. Did the district court abuse its discretion when it denied Zeyen's motion for leave to amend the first amended complaint?

         2. Did the district court abuse its discretion when it denied Zeyen's motion for class certification for lack of standing?

         3. Is Zeyen entitled to attorney's fees on appeal?

         III. STANDARD OF REVIEW

         This Court reviews a trial court's decision to grant or deny a motion for class certification for an abuse of discretion. BHA Investments, Inc. v. City of Boise, 141 Idaho 168, 171, 108 P.3d 315, 318 (2004) (citing Pope v. Intermountain Gas Co., 103 Idaho 217, 646 P.2d 988 (1982)). Likewise, this Court reviews a trial court's decision to grant or deny a motion to amend the pleadings for an abuse of discretion. PHH Mortg. v. Nickerson, 160 Idaho 388, 396, 374 P.3d 551, 559 (2016) (citing Clark v. Olsen, 110 Idaho 323, 326, 715 P.2d 993, 996 (1986)).

         To determine whether a lower court has abused its discretion, this Court asks whether the trial court: "(1) correctly perceived the issue as one of discretion; (2) acted within the outer boundaries of its discretion; (3) acted consistently with the legal standards applicable to the specific choices available to it; and (4) reached its decision by the exercise of reason." Lunneborg v. My Fun Life, 163 Idaho 856, 863, 421 P.3d 187, 194 (2018) (citing Hull v. Giesler, 163 Idaho 247, 250, 409 P.3d 827, 830 (2018)).

         For questions of law, this Court applies a de novo standard of review. Questions of jurisdiction, statutory interpretation, and the interpretation and application of procedural rules are questions of law. See Tucker v. State, 162 Idaho 11, 17, 394 P.3d 54, 60 (2017) ("Jurisdictional issues, like standing, are questions of law, over which this Court exercises free review.") (quoting Christian v. Mason, 148 Idaho 149, 151, 219 P.3d 473, 475 (2009)); Hayes v. City of Plummer, 159 Idaho 168, 170, 357 P.3d 1276, 1278 (2015) ("The interpretation of a statute is a question of law that the Supreme Court reviews de novo."); Smith v. Treasure Valley Seed Co., 161 Idaho 107, 109, 383 P.3d 1277, 1279 (2016) ("[T]he application of a procedural rule is a question of law on which we exercise free review.") (quoting Zenner v. Holcomb, 147 Idaho 444, 450, 210 P.3d 552, 558 (2009)).

         For constitutional challenges, "every presumption is in favor of the constitutionality of the statute, and the burden of establishing the unconstitutionality of a statutory provision rests upon the challenger." Osmunson v. State, 135 Idaho 292, 294, 17 P.3d 236, 238 (2000) (citing State v. Nelson, 119 Idaho 444, 447, 807 P.2d 1282, 1285 (Ct. App. 1991)).

         IV. ANALYSIS

         Although reasonable minds may differ on issues of school funding, this appeal presents two narrow, discrete procedural issues: (A) whether the district court erred in denying Zeyen's motion to amend the first amended complaint; and (B) whether the district court erred in denying Zeyen's motion to certify the class. For the reasons expressed below, we determine that the district court did not err in denying either motion.

         A. The district court did not abuse its discretion when it denied Zeyen's motion to amend the complaint.

         Zeyen contends that the district court abused its discretion when it denied his motion to amend his complaint to specifically identify the takings and due-process clauses of the Idaho and U.S. Constitution. The district court denied his motion on grounds of undue delay and prejudice to School District 25. To challenge undue delay, Zeyen argues that there was no scheduling order at the time, no court-imposed deadlines had passed, and no work had been completed on the merits. As for prejudice, Zeyen contends that the court would not have to reopen discovery because discovery on the merits was still ongoing. In view of the record, we determine that Zeyen has failed to show that the district court abused its discretion in denying his motion for leave to amend the first amended complaint.

         A motion for leave to amend the pleadings is governed by Rule 15(a) of the Idaho Rules of Civil Procedure. Rule 15(a) allows parties to amend the pleadings in three circumstances: (1) as a matter of right under certain circumstances; (2) with the opposing party's written consent; and (3) with leave of court. The purpose of Rule 15 is "to allow the best chance for each claim to be determined on its merits rather than on some procedural technicality" and "to relegate pleadings to the limited role of providing parties with notice of the nature of the pleader's claim and the facts that have been called into question." Clark v. Olsen, 110 Idaho 323, 326, 715 P.2d 993, 996 (1986). "In the absence of any apparent or declared reason . . . the leave sought should, as the rules require, 'be freely given'" because an "outright refusal to grant the leave without any justifying reason appearing for the denial . . . is merely [an] abuse of [] discretion and inconsistent with the spirit" of the Rules of Civil Procedure. Id. at 326, 715 P.2d at 996.

         In Clark v. Olsen, this Court recognized some of the possible reasons that would justify denying a motion to amend the pleading. Id. at 326, 715 P.2d at 996. Originally set out in Foman v. Davis by the U.S. Supreme Court, those reasons are:

- Undue delay;
- Bad faith and dilatory motive on the part of the movant;
- Repeated failure to cure deficiencies by amendments previously allowed;
- Undue prejudice to the opposing party; and
- Futility.

Id. (citing 371 U.S. 178, 182 (1962)). This Court has expanded on the Foman factors to note that "[t]imeliness alone is not a sufficient reason to deny a motion to amend." DAFCO LLC v. Stewart Title Guar. Co., 156 Idaho 749, 756, 331 P.3d 491, 498 (2014). Rather, "[t]imeliness is important in view of the Foman factors . . . ." PHH Mortg. v. Nickerson, 160 Idaho 388, 396, 374 P.3d 551, 559 (2016) (quoting Carl H. Christensen Family Tr. v. Christensen, 133 Idaho 866, 871, 993 P.2d 1197, 1202 (1999)).

         Here, the district court first denied the motion to amend from the bench at the hearing:

This motion for leave to file a Second Amended Complaint is interesting, and I recognize this is purely discretion on my part, and I have to look at that in that way, and I know, also, that I have to consider allowing amendments to be given freely and liberally-liberal grant to allow amendments to take place in Complaints, but it is subject to exceptions, undue delay, bad faith, repeated failure to cure deficiencies by the amendments previously allowed, undue prejudice to the opposing party by virtue of the allowance of the amendments, and so I've been looking over my notes here with regard to that, and looking at the fact that I do have discretion with regard to this amendment, and looking at both arguments here, and the taking is a new cause of action . . .
The defendants have also argued that to allow the amendment by the plaintiffs the second time around would prejudice the defendant, because this could have been asserted, and this is one of the areas that I am concerned about, this could have been asserted at the time of the filing of the Complaint, and, now, there is going to be undue delay. Discovery has ended. There would be a requirement to have to reopen discovery to allow this to occur.
I'm very hesitant to allow the amendment at this point in time . . . . I think based on my discretion and reviewing the briefing and argument here today, I'm going to deny the motion to amend for the second amendment in this Complaint, and take the rest of it under advisement.

         The court also recited its reasoning for denying Zeyen's motion to ...


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