After prevailing in an age discrimination claim in federal court, a retired teacher sought employee contract benefits in state court, but was denied on summary judgment. We affirm.
FACTS
On April 2, 1987 the Rapid City Area School District (School District) notified sixty-five-year-old Robert L. Lee that pursuant to SDCL 13^43-10 it would not renew his teacher’s contract for the 1987-88 school year. Lee requested a hearing before the Board of Education. He also filed grievances through his union. While these proceedings were still pending, Lee and the School District reached a settlement. In exchange for Lee’s resignation and withdrawal of his grievances, the School District agreed to pay Lee $20,000. Lee signed a settlement agreement dated May 27, 1987 and accepted the $20,000, but refused to sign a release so as to preserve his federal age discrimination claim. Lee filed suit in United States District Court pursuant to the Age Discrimination in Employment Act, 29 U.S.C. §§ 621-634 (ADEA), which resulted in an award of $128,612.
Lee v. Rapid City Area School
Dist.,
*740 On June 24, 1993, Lee started suit in circuit court to recover his early retirement benefits and severance pay. Both sides moved for summary judgment. The School District contended Lee previously recovered these benefits when he accepted the School District’s $20,000 settlement; Lee maintained that the $20,000 was paid solely for his resignation and withdrawal of his grievances. The settlement agreement did not itemize the $20,000, but the School District offered an affidavit from its Assistant- Superintendent-Business Affairs to prove how it was computed and why the School District agreed to pay it. The trial court declined to consider the affidavit, however, because the language of the settlement agreement was unambiguous and parol evidence would be inadmissible to controvert its terms. SDCL 53-8-5. In its memorandum the trial court wrote:
The plaintiff has received a verdict which awarded him the difference between what he was paid by the school versus what he should have been paid had he not been forcibly retired. Clearly any retirement benefit he was entitled to receive should have, and would have, been deducted from any amount of recovery obtained under the discrimination action. It would constitute double payment and would be patently unfair to require the school to pay an additional sum to cover a loss which already [has] been compensated. The defendant cannot lie in the weeds with an undisclosed claim for recovery, receive monies in judgment on one cause of action and then seek to recover monies on a separate cause of action which would have clearly been considered a set-off to the original claim resolved in Federal Court. Under the circumstances, the matter before this Court is one which could have and should have been presented to the Federal Court for its consideration to insure that a just verdict was rendered by that Court.
The court granted summary judgment against Lee based on res judicata concluding that the federal district court would have taken jurisdiction of Lee’s state contract claim had Lee submitted it. The court also summarily denied the School District’s request for sanctions. On appeal we address the following issues:
I. Is Lee’s action barred by res judicata? If not,
II. Do other grounds exist to justify the trial court’s grant of summary judgment?
III. Did the circuit court err in denying the School District’s request for sanctions under SDCL 15-6-11?
ANALYSIS
I. Res Judicata and Federal Pendent Jurisdiction
The School District points out that Lee made no claim during the federal proceedings that he was entitled to additional teacher benefits distinct from the $20,000. Lee counters that he was not required to assert such claims in a federal age discrimination suit and that such claim was not in fact considered. The pivotal question is: could Lee have raised his claim for lost benefits in his federal action? Res judicata precludes relitigation of issues previously heard and resolved; it also bars prosecution of claims that could have been raised in the earlier proceeding, even though not actually raised.
Wintersteen v. Benning,
For reasons of “judicial economy, convenience and fairness to litigants,” federal courts may join state and federal claims whenever these claims “derive from a common nucleus of operative fact” and are such that a claimant “would ordinarily be expected to try them all in one judicial proceeding.”
United Mine Workers v. Gibbs,
A considerable split of authority exists on whether ADEA claims can be joined with state claims for breach of an employment contract arising out of the same employment termination. See generally 13B Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3567.1 (1994 supp.). The Eighth Circuit Court of Appeals and the South Dakota federal district courts have not addressed this question.
Some courts believe these claims should be joined.
Ritter v. Colorado Interstate Gas Co.,
Conversely, other courts have held that an ADEA claim and a breach of contract claim do not arise out of a common nucleus of operative fact and for that reason pendent jurisdiction does not exist.
Buchbinder v. Weisser Companies, Inc.,
In
Cemer v. Marathon Oil Co.,
Both the first and second suits seek to remedy a single alleged wrong — the discharge of Cerner by Marathon. In view of the diversity of the parties, both the contract claim and the ADEA claim were within the original jurisdiction of the district court in the first action and should have been brought together. The failure to join them bars the instant suit, as the court below correctly held. (Emphasis added.)
Id. at 832. The Cerner court ruled that based on diversity of citizenship the lower court would have been obligated to accept jurisdiction over the contract claim had it been joined in the first suit. Yet the court commented:
We need not reach the question whether a party must assert a separate claim arising from a single injury where the claim is merely within the court’s pendent jurisdiction. We recognize that unlike a claim with the court’s original jurisdiction, the adjudication of a pendent claim is committed to the district court’s discretion and is not mandatory. (Citation omitted.) We do not resolve how the different policies thus implicated would bear on the scope of res judicata.
Id. at 832, n. 2.
In view of the unsettled state of the law, we simply cannot determine whether in its discretion the federal district court would have taken jurisdiction of Lee’s state contract claim had he attempted to interpose it there. Under these circumstances the principles of res judicata, therefore, cannot be applied to bar Lee’s present action in circuit court.
Accord Pfeiffer v. William Wrigley
*742
Jr. Co.,
II. Lee’s Settlement Agreement Superseded the Negotiated Agreement
As a classroom teacher Lee was represented by the Rapid City Education Association (RCEA) and covered by the Negotiated Agreement between the RCEA and the School District. Pursuant to this Negotiated Agreement, on the effective date of his resignation, Lee was entitled to an early retirement benefit of $5,464.80, plus severance pay based upon accumulated, unused sick leave in the amount of $8,224. Thus the School District owed Lee upon retirement a total of $13,689. The settlement agreement specifically recited that the $20,000 was being paid to Lee in exchange for his “retirement notice ... effective May 27, 1987.” Lee testified that he actually retired the day before the last school day:
Q. And the School Board accepted that so that you could receive some benefits?
A. That’s correct. They called me an early retiree.
Lee offers no hint on why the School District would pay him this money if not for what he was entitled to under his contract. Lee simply argues that since the settlement agreement did not itemize how the amount was computed, he did hot receive his due under the Negotiated Agreement. Yet the evidence offered at the summary judgment hearing was uncontradicted: The $20,000 settlement encompassed all Lee’s contract entitlements. Lee’s union, RCEA, negotiated this settlement for him, just as it had represented all the teachers in arriving at the original Negotiated Agreement. “A contract in writing may be altered by a contract in writing_” SDCL 53-8-7. See also 17A Am.JuR.2d Contracts § 512 (1991) (“The original contract generally remains in force except as modified or superseded by the new agreement. Upon the execution of a valid and legal substituted agreement the original agreement merges into it and is extinguished ... ”). Lee’s settlement agreement and receipt of $20,000 extinguished his claim under the Negotiated Agreement for the severance pay and early retirement benefit he now seeks. We uphold the grant of summary judgment on this basis, although it was not the rationale the circuit court applied.
III. Sanctions
The School District requested the circuit court to grant $2,982 in sanctions under SDCL 15-6-11. Sanctions can be imposed where a party engages in successive filings when it is clear that the assertion urged in the repeat claim was resolved or' could have been resolved in the earlier one.
Crowley v. Spearfish Ind. School Dist.,
The circuit court made no findings in denying sanctions. SDCL 15-6-ll(c) clearly states, “The court shall make findings of fact and conclusions of law for every order entered pursuant to this section.” Where a trial court fails to make the requisite findings and conclusions on a sanctions request, we have previously held that “the request for review is not properly before this court.”
Wang v. Farmers State Bank of Winner,
The School District also seeks sanctions on this appeal. We apply an objective standard to determine whether Lee’s action was reasonable under the circumstances.
Anderson v. Production Credit Ass’n,
Affirmed.