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Washoe County School District v. White

Supreme Court of Nevada

June 29, 2017


         Appeal from a district court order vacating an arbitration award. Second Judicial District Court, Washoe County; Scott N. Freeman, Judge.

          Washoe County School District Legal Department and Christopher B. Reich, Neil A. Rombardo, and Sara K. Almo, Reno, for Appellant.

          Reese Kintz Guinasso, LLC, and Devon T. Reese and Jason D. Guinasso, Reno, for Respondents.



          PARRAGUIRRE, J.

         In this appeal, we are asked to determine whether the district court erred in granting a motion to vacate an arbitration award affirming a school district's termination of a principal. We answer in the affirmative and conclude that (1) the arbitrator did not exceed his authority because his decision did not conflict with the language of the parties' collective bargaining agreement, (2) the arbitrator did not manifestly ignore the law because he acknowledged NRS 391.3116 and applied the statute in reaching his decision, and (3) the arbitration award was not arbitrary or capricious because it was supported by substantial evidence. Accordingly, we reverse the district court's order granting respondents' motion to vacate the arbitration award.


         From 2008 until 2013, respondent Kara White was employed as the principal of Lemmon Valley Elementary School (Lemmon Valley). White was a member of respondent Washoe School Principals' Association (WSPA), and the WSPA and appellant Washoe County School District (District) were parties to a collective bargaining agreement (CBA) governing the District's employment terms.

         During White's first year as the principal of Lemmon Valley, she received training on the use of school funds, including student activity funds (SAFs). The training emphasized that SAFs could not be used to purchase gift cards for employees. In 2009, Lemmon Valley was randomly selected for auditing, and the audit report revealed that the school had issued gift cards to teachers and staff employees that could expose the District to IRS penalties and fines, and that White had signed off on checks that she had issued to herself. The District sent White a report of the audit and discussed it with her, and White was told to reference the Student Activity Funds Policies and Procedures Manual (Manual) regarding any uncertainties with the use of school funds. The Manual specifically prohibits using SAFs to purchase meals and gifts for administrators or staff. White responded in writing that she would no longer permit or engage in the improper use of school funds. In 2011, training materials for SAFs were emailed to White, which again referenced the Manual.

         In February 2013, a counselor at Lemmon Valley notified the District that White had gifted her a $149 necklace purchased with school funds. The District began an investigation into the matter, which included a special audit of expenditures from Lemmon Valley's spring and fall SAFs from 2011 to 2013. At that time, Lemmon Valley participated in biannual fundraisers during the fall and spring, and the proceeds were deposited as SAFs. The fall fundraiser SAF was designated for purchasing playground equipment, and the spring fundraiser SAF was designated for funding student and classroom-based activities and supplies.

         The special audit for 2011-2012 revealed that around $5, 960 of the expenditures from the fall and spring SAFs were inappropriate.[1] The special audit for 2012-2013 revealed that around $3, 287 of the fall fundraiser SAF expenditures were inappropriate.[2] In March 2013, White received a letter notifying her of pending investigations and a mandatory meeting with the District regarding her misuse of SAFs. In particular, the letter stated that White's actions resulted in a violation of NRS 391.312 for;

(c) Unprofessional conduct;. . . (i) Inadequate performance; . . . (k) Failure to comply with such reasonable requirements as a board may prescribe; (I) Failure to show normal improvement and evidence of professional training and growth; . . . (p) Dishonesty.

(Emphasis added.)

         In April 2013, White received a notice of recommended dismissal following the District's investigation of her misuse of SAFs. During the investigation, the District found White's responses to the audit during her meeting with the District to be "less than credible" when she claimed to be unaware of the Manual, despite her prior misuse of SAFs during the 2009 audit, which was discussed with her personally. As such, the District concluded that White's responses were "dishonest, " and resulted in a violation of NRS 391.312 for "[d]ishonesty." The following month, the District's Deputy Superintendent Traci Davis upheld the recommendation for termination, and White appealed the termination decision to arbitration.

         The arbitration hearing was conducted in February 2014 during the course of four days. When the original arbitrator became sick post-hearing, the parties selected Alexander Cohn to render a decision in her place. Arbitrator Cohn received post-hearing briefs and the arbitration record for review. Thereafter, Arbitrator Cohn issued a 61-page opinion and award (Award) affirming the District's decision to terminate White because she "was discharged for just cause" for her dishonesty in the matter. In March 2015, White filed a motion to vacate the Award in the district court. The district court granted White's motion, holding that (1) Arbitrator Cohn exceeded his authority, (2) Arbitrator Cohn manifestly disregarded NRS 391.3116, and (3) the Award was arbitrary and capricious. The District now appeals the district court's order.


         Standard ...

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