DOCKET NO. 122-R10-1294 and
DOCKET NO. 123-R10-1294
WALTER YATES and §BEFORE THE STATE
MARVIN PETTWAY§
§
v.§ COMMISSIONER OF EDUCATION
§
HOUSTON INDEPENDENT§
SCHOOL DISTRICT§THE STATE OF TEXAS
DECISION OF THE COMMISSIONER
Statement of the Case
Petitioners Walter Yates and Marvin Pettway appeal from a decision of the board of trustees of Respondent Houston Independent School District (HISD), upholding their terminations from their coaching positions. Petitioner Yates was formerly employed as head basketball coach at Madison High School within the HISD. Petitioner Pettway was employed as head women's basketball coach and an assistant football coach at Lee High School within the HISD. Both were terminated from those positions during the spring of 1994. They remain in the employment of HISD as teachers.
These consolidated appeals were heard on the merits before Administrative Law Judge James C. Thompson on April 25, 1995. Petitioners are represented by Philip Durst, Attorney at Law, Austin, Texas. Respondent is represented by Jeffrey J. Horner, Attorney at Law, Houston, Texas.
On August 10, 1995, the Administrative Law Judge issued a Proposal for Decision recommending that Petitioners’ appeals be granted. Exceptions and replies were timely filed and considered.
Findings of Fact
After due consideration of the evidence and matters officially noticed, in my capacity as State Commissioner of Education, I make the following Findings of Fact:
1. During the 1993-94 school year, Petitioners Walter Yates and Marvin Pettway were longtime employees of HISD as teachers and coaches. Petitioner Yates was the head boys' basketball coach at Madison High School. Petitioner Pettway was, inter alia,the head girls' basketball coach at Lee High School. Each of these positions carried significant duties and benefits.
2. During the 1993-94 school year, both Petitioners had their coaching duties removed by the principals at their respective schools to be effective starting the 1994-95 school years.
3. At or about the start of the 1993-94 school year, and at or about the commencement of each school year in recent years, HISD prepared the "The Houston Independent School District Athletic Handbook" (Athletic Handbook) delineating the policies and procedures applicable to the athletic programs of HISD.
4. The Athletic Handbook is promulgated pursuant to HISD Board Policy §761.000, which states in pertinent part "Athletic Program: The program shall function in accordance with the University Interscholastic League rules and regulations and such additional rules and regulations as provided in Administrative Proceduresand the Athletic Handbook guidelines." (Emphasis added.)
5. The Athletic Handbook governs the HISD Athletic program in great detail. It is a thick, official-looking booklet over 135 pages in length.
6. The Athletic Handbook is annually reviewed and directly approved within the Athletic Department by Mr. Jim Ashmore ("Director of School Athletics and Activities" for HISD), and by Mr. Lloyd Choice (HISD "Superintendent of School Operations").
7. The Athletic Handbook depicts HISD's seal, and lists its Board of Education on the inside front cover. It lists Mr. Choice's position as the next name directly under HISD's superintendent of schools.
8. Pages 19 to 25 of the Athletic Handbook are illustrative of the detail present in the Athletic Handbook. These pages set out the precise compensation due each type of coach within HISD, and the policies governing their employment. Page 19 begins with the bold-faced and capitalized heading "HISD BOARD POLICY AND ADMINISTRATIVE PROCEDURES" and tracks the six-digit numbering system of officially adopted policies of the HISD board of trustees.
9. Section 551.310 (a)(5) in the Athletic Handbook is entitled "Dismissal of Football, Basketball, and Volleyball Coaches." It sets out a precise procedure for the dismissal of coaches involving the principal, the Athletic Department, the area superintendent, and rests the final decision with "the Deputy Superintendent of School Operations and the Deputy Superintendent for Personnel Management and Development."
10. Section 551.310 (b) lists a procedure and timetable to be followed for the evaluation of coaches.
11. HISD teacher-coaches are provided instruction and training annually on the procedures contained in the Athletic Manual. They are told that the Athletic Manual is the resource to be consulted when questions arise.
12. Both Petitioners were trained on and had access to the Athletic Handbook.
13. The cover letter that accompanied the distribution of the Athletic Handbook instructs coaches to "Please remove all materials from the year before and replace it with the correct materials enclosed. Hopefully this handbook will keep you informed of current and pertinent information governing athletic activities for middle and high school girls and boys in HISD." (Emphasis added)
14. This "cover memorandum" was approved by the Deputy Superintendent of School Operations.
15. At all relevant times, Petitioners relied upon the Athletic Handbook and followed the Handbook procedures themselves.
16. The procedures stated in section 551.310 of the Athletic Handbook for the evaluation and removal of coaches were not followed in the termination of Petitioners' coaching duties. Rather, these terminations were accomplished pursuant to a district-wide “Salary Administration Manual.”
17. On or about August 23, 1990, the HISD board of trustees "approved revision of policy sections 551.000 through 551.390 related to compensation of benefits" and the creation of the district-wide "Salary Administration Manual."
18. The minutes from this August 23, 1990, meeting explain the "rationale" for this amendment as follows:
These changes are necessary in order to implement the new salary schedules and employee step increases approved by the Board for the 1990-91 school year. The administration is recommending much of current policy to a new Salary Administration Manual. These changes will simplify Board Policy in these areas. Significant effort has been made to retain as much of the current policy in the new manual as possible. However, some changes in the grouping of information have been made for ease of use of the manuals.
Minutes of HISD Special Board Meeting, PX- 8 (Emphasis added).
19. HISD has specific board policies governing the "Development of [HISD Board] Policy." HISD Board Policy §111.500 contains two paragraphs germane to this appeal:
When a proposed action of the Board ... affects existing policies, the existing policies and procedures, if any, shall be presented so that the effect of the new action will be clear.
When policies are altered or replaced, the new or revised policy with its appropriate number shall be accompanied by the previous policy and its number. In such instances, rights accrued under the previous policy shall be retained.
HISD Board Policy §111.500, PX- 7.
21. There is no evidence in the record that after the HISD board approved the creation of the Salary Administration Manual that any attempt was made to inform teachers or coaches of any substantive change to pre-existing policies affected by the adoption of the Salary Administration Manual.
22. The 1993-94 Salary Administration Manual of HISD contains the following section 551.300:
Supplemental compensation shall be paid to an employee who is assigned certain extra duties and responsibilities. Such assignments will be made by the principal and are subject to cancellation at any time.
1993-94 Salary Administration Manual, PX- 13a (Emphasis added).
1. At the time of the HISD board of trustee’s vote on August 23, 1990, section 551.300 was a validly adopted procedure of the HISD board. PX-4.
2. Since adoption of the Salary Administration Manual in 1990, at least three annual Athletic Handbooks were issued to the HISD coaches informing them that section 551.300 of the Athletic Handbook was still the valid and existing "HISD Board Policy and Administrative Procedure."
3. At the time of their terminations from their coaching duties, neither Petitioner had seen or was aware of any procedure contrary to Athletic Handbook section 551.310. No HISD official had ever provided the Salary Administration Manual to them or told them of its existence, nor that it contained terms taking away the procedural rights they had been informed were HISD board policy.
4. Many of HISD's top administrators also did not know that Athletic Handbook section 551.310 was superseded and no longer policy.
5. The Director of School Athletics and Activities, Mr. Jim Ashmore, did not know that HISD considered Athletic Handbook section 551.310 superseded and no longer in full force and effect until after Petitioners’ coaching assignments were terminated.
6. Both the Director of School Athletics and Activities and HISD's Deputy Superintendent for School Operations (the "number two" administrator listed by the district in its Athletic Handbook), approved the inclusion of section 551.310 in the Athletic Handbook for all years through Petitioners' terminations after the board's action in 1990.
7. Even HISD's Assistant Superintendent believed that Athletic Handbook section 551.310 was to be followed at the time of Petitioners' termination as the valid embodiment of HISD board policy.
8. No relevant HISD athletics administrator was ever made aware that the termination procedures contained in section 551.310 of the Athletic Handbook were superseded. Neither Petitioner was ever actually made aware of the diminution of their termination rights.
9. The HISD Athletic Handbook defines the duties of the HISD "Director of School Athletics and Activities" (a position held at all relevant times by Mr. Ashmore) as follows:
The Director of School Athletics and Activities has the responsibility to develop policy recommendations for the athletic programs and to interpret existing policy; [and] administer and coordinate all components of these programs;
1993-94 Athletic Handbook at 11, PX-2.
1. Even after the creation of the Salary Administration Manual, each individual department within HISD was authorized to develop or maintain its own procedures as long as not inconsistent with board policy.
2. The Director of School Athletics at all pertinent times had the authority to implement and interpret HISD board policy governing athletics.
3. The issuance of the Athletic Handbook was done with the knowledge of the HISD board. The promulgation of the Athletic Handbook as a vehicle to publicize the "rules and regulations" governing the Athletic Program of HISD was done with the knowledge of the HISD board and was done pursuant to the will of the board.
4. The HISD board knowingly permitted the Athletic Department and the relevant administrators to promulgate the Athletic Handbook.
5. Petitioners were reasonable in believing that these administrators had the authority they purported to exercise in promulgating the Athletic Handbook.
6. Section 551.310 was included in the Athletic Handbook after the adoption of the Salary Administration Manual by mistake.
7. As soon as the mistake was discovered, it was corrected and the superseded section was taken out of the Athletic Handbook.
8. Petitioner Yates' hearing before the HISD board was on October 20, 1994.
9. Petitioner Yates' filed his appeal on Monday, December 5, 1994.
10. The forty-fifth day after October 20, 1994 fell on Sunday, December 4, 1994.
Discussion
Estoppel
The key issue in this case is the application of board policy 551.310. Petitioners urge that the HISD Athletic Handbook should be binding upon Respondent and Respondent should be estopped from asserting it has no application in this case. Respondent counters that the publication of the obsolete policy in the Athletic Handbook was simply a mistake, and in no way revived or resuscitated the old policy. Further, HISD argues that Petitioners should be bound by current policy as stated in the Salary Administration Manual.
The dispositive question is whether the doctrine of estoppel applies against HISD. The general rule in Texas is that "when a unit of government is exercising its governmental powers, it is not subject to estoppel." SeeBowman v. Lumberton ISD, 801 S.W.2d 883, 888 (Tex. 1990). This general rule is subject to an exception that municipalities and other units of government "may be estopped in those cases where justice requires its application, and where there is no interference with the exercise of its governmental functions." Id. The general rule arises out of the doctrine of governmental immunity. SeeDillard v. Austin ISD, 806 S.W.2d 589, 593 (Tex. App.--Austin 1991, writ denied). Unlike other governmental entities, school districts perform only governmental functions and do not perform any proprietary functions. SeeBraun v. Trustees of Victoria ISD, 114 S.W.2d 947, 949-50 (Tex.Civ.App.--San Antonio 1938, writ refused).
Because school districts do not perform proprietary functions, the "no estoppel exception" normally is not applied to school districts. SeeDillard at 595. Few cases have extended the "no estoppel exception" to school districts. Indeed, in Bowman the Texas Supreme Court stated that it would only extend the "no estoppel exception" to school districts where the evidence "clearly indicates that a subordinate officer's act was done with the knowledge of the governing body and was so closely related to the expressed will of the governing body as to constitute his act as that of the board." SeeBowman at 888. The court in Dillard further noted that the language in Bowman applies only in contract disputes. Other courts have emphasized that the exception "should be applied with caution and only in exceptional cases where the circumstances clearly demand this application to prevent manifest injustice." SeeCity of Hutchins v. Prasifka, 450 S.W.2d 829, 836 (Tex. 1970). It is also well settled that to state a claim for estoppel against a governmental unit, a party must allege more than mere negligence, inaction, or failure to follow an internal agency guideline. See, e.g., Fano v. O'Neil, 806 F.2d 1262, 1265 (5th Cir. 1987).
The following elements must be met to successfully assert an estoppel claim: The party to be estopped made a definite misrepresentation to the parties asserting estoppel; the party to be estopped was aware of the facts; the party to be estopped intended the party asserting estoppel to act on its misrepresentation or had reason to believe the party asserting estoppel would act on its misrepresentation; the party asserting estoppel had neither knowledge nor reason to know the facts; and the party asserting estoppel reasonably relied on the misrepresentation to its detriment. SeeFDIC v. Niblo, 821 F.Supp. 441 (N.D. Tex. 1993). In addition to these elements, a party asserting estoppel must show more than mere negligence, inaction, or failure to follow internal guidelines. SeeFano, supra.
Both the Texas courts and the Commissioner have consistently held that unauthorized representations made by school officials do not bind a school district.[1] The Commissioner has consistently followed the teachings of Davis v. Duncanville ISD and other courts.[2] Nevertheless, principles of estoppel and waiver can apply to the employment decisions of school districts.[3] It is also well settled that the superintendent and other administrators of a school district can act as agent for the board when authority is delegated to them. Bowman,801 S.W.2d at 888. As the Texas Supreme Court has adopted, "While estoppel cannot be used to create a new power or enlarge one already in existence, it may be employed to defend against a mere irregularities in the doing of a thing in controversy where the power was present to do so." Id., 801 S.W.2d at 888-89; citingEl Paso County v. City of El Paso, 357 S.W.2d 783, 789 (Tex.Civ.App.--El Paso, 1963 no writ). If a school district board has delegated the power to adopt a certain rule or policy, then it can be bound by estoppel or waiver by the conduct of said administrators when carrying out this delegated authority.
Estoppel may be used to against persons acting within their actual or apparent authority. The Courts have defined actual authority as follows:
Actual authority is authority that the principal intentionally conferred upon the agent, or either intentionally or for want of due care allowed the agent to believe he possessed.
Munoz v. II Jaz, Inc.,863 S.W.2d 207 (Tex.App.--Houston [14th Dist.] 1993) (citations omitted). Actual authority comes from either the intentional or express conferral of power to an agent, or such actions that would reasonably flow from expressly conferred authority. SeeEmployers Casualty Co. v. Winslow, 356 S.W.2d 160 (Tex.Civ.App.--El Paso 1962, writ ref'd n.r.e.); see generally, 3 Tex.Jur.3d, Agency §40. "Apparent" authority is authority that a reasonably prudent person using diligence and discretion would naturally and reasonably suppose the agent to possess. See 3 Tex.Jur.3d, Agency §47. For an agent to have "apparent" authority, the principal must induce a third person to believe that person with "apparent authority" was the principal's agent, even though the actual authority does not exist. SeeRoberts v. Capitol City Steel Co. 376 S.W.2d 771 (Tex.Civ.App.--Austin 1964, writ ref'd n.r.e.). The Texas Supreme Court has said of apparent authority:
It may arise either from a principal permitting an agent to hold herself out as having authority or by a principal's actions which lack the such ordinary care as to clothe an agent with the indicia of authority, thus leading a reasonably prudent person to believe that the agent has the authority she purports to exercise.
Ames v. Great Southern Bank, 672 S.W.2d 448, 450 (Tex. 1984).
Under Texas law, the HISDboard is of course the sole policy maker for Respondent; school administrative officials, even the superintendent, do not possess any policy making authority unless it is delegated to them by the board. See Tex.Educ.Code §23.28; Jett v. Dallas ISD, 7 F.3d 1241 (5th Cir. 1993). However, this record makes plain that the HISD board knew and directed that an Athletic Handbook be prepared and disseminated, and knew it would set out the "policies and procedures" of HISD governing athletics. HISD Policy §761.300. For each year, the Athletic Handbook was written and reviewed by the highest levels of HISD administration under their duly delegated authority. Under all the facts of this case, the Athletic Handbook and its direct and unequivocal representations of HISD board policy are binding as clearly promulgated by administrators within their actual and/or apparent authority. Certainly, Petitioners acted reasonably when they relied upon the statements of board policy in the Athletic Handbook. Petitioners cannot be charged with actual or constructive knowledge of the change in board policy in 1990 when officials of HISD, year-in and year-out, instructed them that HISD policy 551.310 was in effect.
Because it is uncontested that Respondent failed to comply with section 551.310 of the Athletic Handbook in terminating Petitioners from their coaching positions, that is, that the district failed to comply with its own policies in implementing this decision, the Petitions for Review must be GRANTED and the terminations REVERSED.