IN THE SUPERIOR COURT OF THE VIRGIN ISLANDS DIVISION OF ST. THOMAS AND ST. JOHN KRRRKEKKERKKREEE GOVERNMENT OF THE VIRGIN ISLANDS, ) CASE NO. SX - 2013-CV-00491 DEPARTMENT OF EDUCATION, ) ACTION FOR DECLARATORY JUDGMENT AND TO VACATE ARBITRATOR’S DECISION & AWARD Plaintiff, V. AMERICAN FEDERATION OF TEACHERS LOCAL 1826 on behalf of SOCIAL WORKERS And PSYCHOLOGISTS, Defendant. ) ) ) ) ) ) ) ) ) ) ) ST. CROIX FEDERATION OF TEACHERS, _ ) INC., ON BEHALF OF ST. CROIX V.I. ) DEPARTMENT OF EDUCATION SCHOOL _ ) PSYCHOLOGISTS, SOCIAL WORKERS, AND) EDUCATION DIAGNOSTICIANS, ) CASE NO. SX-2014-CV-00352 ) ) ACTION FOR CONFIRMATION Plaintiff, ) OF ARBITRATION AWARD ) Vv. ) ) ) ) ) ) GOVERNMENT OF THE VIRGIN ISLANDS OF THE UNITED STATES, Defendant. Cite as: 2020 VI Super 96U MEMORANDUM OPINION I. INTRODUCTION ql THIS MATTER is before the Court on competing actions regarding an Arbitrator’s Award and Order issued on August 28, 2013. The Department of Education of the Government of the Virgin Islands (“Government”) seek the issuance of a declaratory judgment confirming the award. The St. Croix Federation of Teachers, Inc. AFT Local 1826 (“Union”) want the Award vacated. The Award was issued after the Government and the Union grieved an action in accordance with their Collective Bargaining Agreement (“CBA”) and the matter proceeded to arbitration in June 2013. The resulting Decision and Award of Arbitrator, U.S. Virgin Islands Gov’t of the V.I. v. Am. Fed’n of Teachers, Local 1826 2020 VI Super 96U Case No. SX-2013-CV-00491 St. Croix Fed’n of Teachers, Inc. v. Gov’t of the V.I. Case No. SX-2014-CV-00352 Memorandum Opinion Page 2 of 11 PERB NO. RA-132-12 (herein “Arbitration Award and Order’) partially upheld the grievance, granted the Union’s request for their employees to be compensated for extra hours worked during the 2012-2013 school year. The Government contends that the Arbitrator’s decision alters provisions of the parties’ agreement and requests this Court to set aside his decision favoring the Union. q2 The for reasons set forth below, the Court finds no reason to disturb the Arbitrator’s Award and Order. Il. FACTUAL AND PROCEDURAL BACKGROUND 43 On August 30, 2012, Nicole Jacobs, the Department of Education’s Assistant Director for Human Resources, issued a memorandum mandating longer working hours for certain employees within the Virgin Islands Department of Education.' Specifically, “social workers, psychologists, and diagnosticians shall be required to work an eight (8) hour day with one (1) hour lunch and shall observe the legal holidays and vacation period associated with the school calendar....”” The Union asserted that requiring school psychologists and social workers to “work from 8 a.m. to 5 p.m. without any increase in pay [where] previously their working hours had been 8 a.m. to 3 p.m. for at least 32 straight years” violated the collective bargaining agreement.’ After following the CBA’s grievance procedure, the parties brought their dispute before Arbitrator Steven G. Hoffmeyer at a hearing on June 24 and 27, 2013. After the parties submitted post-hearing briefs, the Arbitrator issued an Award and Order on August 28, 2013, which held that the “Union’s request to have the Employer compensate the affected employees at their NOPAs* regular hourly rate for the extra hours of 3:00 p.m. to 5:00 p.m. for the time period of school year 2012-2013 is GRANTED” and “the Union’s request for this compensation to be continued as long as the extra hours are required is GRANTED.”° Finally, the Arbitrator ordered the Employer “with all deliberate speed, [to] undertake an action(s) to accomplish payment to the affected employees.’ q4 On November 27, 2013, the Government filed a Complaint requesting that this Court issue a declaratory judgement stating that the Government is not bound by the Arbitration Award and Order. On August 27, 2014, the Union filed a “Counterclaim Complaint” seeking a declaratory judgment confirming the enforceability of the Arbitration Award and Order. q5 During a status conference held on March 21, 2016, this Court stated it would allow the parties to file briefs on the merits of their respective applications for declaratory judgment and ordered the parties to file a joint appendix supporting their positions. On December 14, 2017, this Court ordered the parties to file briefs addressing the following questions: (1) Does the Federal 'J.A. at 204-06. > Td. 3 J.A. at 62. 4 Notice of Personnel Action (“NOPA”). > J.A. at 60. Gov’t of the V.I. v. Am. Fed’n of Teachers, Local 1826 2020 VI Super 96U Case No. SX-2013-CV-00491 St. Croix Fed’n of Teachers, Inc. v. Gov’t of the V.I. Case No. SX-2014-CV-00352 Memorandum Opinion Page 3 of 11 Arbitration Act (“FAA”) preempt local statues affording this Court jurisdiction over these matters; (2) Assuming this Court retains jurisdiction, is further discovery necessary in order for this Court to issue a declaratory judgment; (3) What standard of review should this Court apply to determine whether it should vacate the Arbitration Award and Order; and (4) Whether this Court should vacate the Arbitration Award and Order. 46 On January 25, 2018, the Government filed its brief addressing questions outlined in the Court’s December 14, 2017 Order. In Response, the Union filed its brief on December 12, 2018. The Government filed a Reply to the Union’s Brief on February 28, 2018. q7 Having reviewed the parties’ briefs, joint appendix, exhibits and pleadings on file herein, the Court makes the following findings of fact as relevant to deciding the issues presented: first, whether the FAA preempts contrary local law; second, whether further discovery is necessary for this Court to issue a declaratory judgement; third, if further discovery is not needed, the Court must determine what law governs its review of a binding arbitration award; and lastly decide whether this Court should vacate the Arbitration Award and Order. il. ANALYSIS 1. The Federal Arbitration Act Does Not Preempt Local Statutes Affording this Court Jurisdiction 48 The parties correctly agree that the Federal Arbitration Act “(FAA”) does not preempt local law. Accordingly, the common law of arbitration and this jurisdiction governs the extent to which this Court can review the Arbitrator’s Award. 9 In providing their analysis, both parties assume that citing to federal case law or the Restatement of Law establish the Court’s jurisdiction over arbitral matters. However, arbitration in the Virgin Islands is not governed by statute, so the decisions and application of federal rules represent only persuasive authority and are not binding on this Court.’ Until the decision in Government of the Virgin Islands, Department of Education v. St. Thomas/ St. John Educational Administrators’ Association, Local 101,° the Supreme Court of the Virgin Islands had not previously addressed the extent to which arbitration awards are subject to judicial review. q10 In Gov't of Virgin Islands, Dep't of Educ. the Supreme Court of the Virgin Islands cited authority from the Supreme Court of the United States as persuasive guidance to determine the Superior Court’s jurisdictional authority.” In doing so, the V.I. Supreme Court first considered 7 Gov't of Virgin Islands, Dep't of Educ. v. St. Tomas/St. John Educ. Administrators’ Ass'n, Local 101, 0.b.0. Forde, 67 V.I. 623, 633 (V.I. 2017). 81d. ? Id. at 629-30 (citing “United Paperworkers Int'l Union, AFL-CIO v. Misco, Inc., 484 U.S. 29 (1987), the Supreme Court instructs that a trial court plays “only a limited role” when reviewing an arbitration award, in that trial courts “are not authorized to reconsider the merits of an award even though the parties may allege that the award rests on Gov't of the V.I. v. Am. Fed’n of Teachers, Local 1826 2020 VI Super 96U Case No. SX-2013-CV-00491 St. Croix Fed’n of Teachers, Inc. v. Gov’t of the V.I. Case No. SX-2014-CV-00352 Memorandum Opinion Page 4 of 11 “whether section 10 [of the FAA] preempts contrary local law” and then elected to follow “jurisdictions that have concluded that section 10 of the FAA does not preempt local law in proceeding instituted in local courts.”!° 411 Section 10 of the FAA generally delineates the specific grounds upon which a trial court may vacate an arbitration award.'' In Hall Street Associates, L.L.C. v. Mattel, Inc., “the Supreme Court of the United States concluded that the grounds for vacating or modifying an award set forth in sections 9 through 11 of the FAA are the exclusive bases for vacating or modifying awards under the FAA.”!” Further recognized in United Industrial, “the Supreme Court of the United States confirmed that in creating the [FAA], ‘Congress’ principal purpose [was] ensuring that private arbitration agreements are enforced according to their terms.”!? Accordingly, the Supreme Court in Gov't of Virgin Islands, Dep't of Educ. concluded that “given the practices of other jurisdictions since Hall Street was decided, and in light of the fact that we have previously questioned the preemptive effect (see United Industrial, 64 V.1. at 325—26(collecting cases)), we errors of fact or on misinterpretation of the contract” because they “do not sit to hear claims of factual or legal error by an arbitrator as an appellate court does in reviewing decisions of lower courts.” /d. at 36, 38.”; citing also “United Steelworkers of Am. v. Enterprise Wheel & Car Corp., 363 U.S. 593, 599 (1960)). “a [trial] court should not reject an award on the ground that the arbitrator misread the contract.”)”; ( “A contrary conclusion undermines the strong federal policy favoring arbitration by permitting trial judges to substitute their opinion for those of the arbitrators.”); citing Enterprise Wheel & Car Corp., 363 U.S. at 596)) (“The federal policy of settling labor disputes by arbitration would be undermined if courts had the final say on the merits of the awards.”)). '0 Td. at 632. (citing Cable Connection, Inc. v. DIRECTV, Inc., 190 P.3d 586, 599 (Cal. 2008) (‘The [Supreme Court] unanimously left open other avenues for judicial review, including those provided by state statutory or common law.... While the court, of course, decided nothing about the viability of these alternatives, their mention in the majority opinion indicates that Hall Street's holding on the effect of the FAA is a limited one.) See, e.g., Raymond James Fin. Servs. v. Honea, 55 So. 3d 1161, 1168-69 (Ala. 2010) (interpreting Hall Street, treating section 10 of the FAA as “procedural as opposed to substantive law,” and retreating from the position that Alabama courts may only apply section 10 when determining whether to vacate or modify an arbitration award); Finn v. Ballentine Partners, LLC, 143 A.3d 859, 867-68 (N.H. 2016)(same, with respect to New Hampshire law); Humitech Dev. Corp. v. Perlman, 424 S.W.3d 782, 791 (Tex. App. 2014) (same, with respect to Texas law); cf Davies v. Waterstone Capital Megmt., 856 N.W.2d 711, 715-16 (Minn. Ct. App. 2014) (concluding that “Minnesota courts may apply state law to motions to confirm or vacate arbitration awards” so long as doing so does not conflict with section 2 of the FAA), cert. denied, —US. , 136 S. Ct. 78 (2015); Trombetta v. Raymond James Fin. Servs., 907 A.2d 550, 565 (Pa. Super. Ct. 2006) (concluding that section 10 of the FAA did not preempt the provision for vacating or modifying an award contained in Pennsylvania's arbitration act))). 'l9 U.S.C.A. § 10. Section 10(a) of the FAA provides: “ (a) In any of the following cases the United States court in the district wherein the award was made may make an order vacating the award upon the application of any party to the arbitration-- (1) where the award was procured by corruption, fraud, or undue means; (2) where there was evident partiality or corruption in the arbitrators, or either of them; (3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or (4) where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.”). "2 Gov't of Virgin Islands, Dep't of Educ. v. St. Tomas/St. John Educ. Administrators’ Ass'n, Local 101, 0.b.0. Forde, 67 V.I. 623, 631 (2017) (citing Hall Street Associates, L.L.C. v. Mattel, Inc., 552 U.S. 576, 591 (2008)). 3 United Industrial, 64 VI. at 326 (recognizing (quoting Volt anf. Scis., Inc. v. Bd. ot Trustees ee Leland id Stangord Junior Univ., 489 U.S. 468, 478 (1989))), —— — 432 The Court agrees that “a writing intended as the entire understanding of the parties is then subject to the parol evidence rule which precludes consideration of extrinsic evidence of prior or contemporaneous agreements extending or altering the authority granted in a writing.”*° However, the parol evidence rule does not bar all subsequent proof that additional agreements of the parties intent exist and could be given force. Specifically addressing this issue, “the United States Supreme Court noted in dicta, Yet even a written contractual provision declaring that the contract contains the complete agreement of the parties, and that no antecedent or extrinsic representations exist, does not conclusively bar subsequent proof that such additional agreements exist and should be given force. The provision denying the 40 Td. “| Gov't of Virgin Islands Dep't of Edu., 67 V.1. 623 at 642. ” Td. at 641. * Id. (referencing Goodwine v. Miller, 32 Ind. 419, 421-22 (1896) (“[I]f judges chosen by the parties erroneously decide a question of law, the court will abide the decision.”)). 4 Gov’t Brief at 4. 45 Td. “© Phillips v. Andrews, 332 F.Supp.2d 797, 803 (D.V.1.2004) (citing Finley v. Mole (D.V.I. 2015)). Gov’t of the V.I. v. Am. Fed’n of Teachers, Local 1826 2020 VI Super 96U Case No. SX-2013-CV-00491 St. Croix Fed’n of Teachers, Inc. v. Gov’t of the V.I. Case No. SX-2014-CV-00352 Memorandum Opinion Page 11 of 11 existence of such agreements, of course, carries great weight, but it can be set aside by a court on the grounds of fraud, mistake, duress, or on some ground that is sufficient for setting aside other contracts.’*’ 433 Further, the Government contends the Arbitrator violated the law by “applying the provisions of the Personnel Merit System of Title 3 of the Virgin Islands Code, Section 561 which requires Government employees to work a 40-hour week [and replacing it] with the collective bargaining agreement.”*’ However, it is not the role of the Court to determine whether the arbitrator mistakenly applied Section 561 of Title 3 because mistaken application of the law does not expose an arbitral award to judicial review.*? Therefore, the Court finds that the Arbitrator did not manifestly disregard the law in his Award and Order. IV. CONCLUSION 434 After considering the parties’ briefs, joint appendix, exhibits and pleadings on file herein, the Court finds that 1) the FAA does not preempt local statutes affording this Court jurisdiction; 2) further discovery is not necessary for this Court to issue a declaratory judgment; and 3) there is no basis to vacate the Arbitrator’s Award. The Arbitrator did not exceed his authority in rending the Award in favor of the Union as demonstrated by his detailed reasoning in the Award and Order, the parties’ agreement to arbitrate, and his interpretation of the disputed section of the CBA. In finding that the disputed language and application was ambiguous enough to require interpretation, the Arbitrator appropriately reviewed the parties’ arguments and decided accordingly. Additionally, the Government has failed to convince the Court that the Arbitrator manifestly disregarded the law when issuing his award. The Court finds his analysis appropriate and therefore has no basis to vacate his decision. The Arbitration Award and Order issued on August 28, 2013, in the matter of Jn re Arbitration between American Federation of Teachers, Local 1826 School Psychologists and Social Workers and United States Virgin Islands Department of Education, U. S. Virgin Islands, PERB No. RA-132-12 will be confirmed. A judgment consistent with this Memorandum Opinion follows. DATED: t( [24{2020 LN hanno DENISE M. FRANCOIS Re Judge of the Superior Court of the Virgin Islands DONNA D. pong res Supervisor VAN) ay ee) 47 Finley v. Mole (D.V.I. Apr. 1, 2015) (citing Blackledge, 431 U.S. at 75 n.6). 48 Gov’t Reply at 5. Supra at n.41. oe nn ——