Townsend v. Antioch Univ.Townsend v. Antioch Univ.
Rendered on the 29th day of May , 2009.
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W. EVAN PRICE II, Atty. Reg. No. 0056134 and MICHAEL R. GOODSTEIN, Atty. Reg. No. 0080476 and SABRINA HAURIN, Atty. Reg. No. 0079321, One Columbus, 10 West Broad Street, 21st Floor, Columbus, Ohio 43215
Attorneys for Plaintiffs-Appellants
KATHLEEN M. TRAFFORD, Atty. Reg. No. 0021753 and KENDALL V. SHAW, Atty. Reg. No. 0076556, 41 South High Street, Columbus, Ohio 43215
Attorney for Defendant-Appellee
WILLIAM R. GROVES, Atty. Reg. No. 0009440, One S. Limestone Street, Suite 800, Springfield, Ohio 45502
Attorney for Defendant-Appellee
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WOLFF, J. (by assignment)
{¶ 1} The appellants, a group of tenured Antioch College professors, appeal from the
{¶ 2} The appellants advance three assignments of error. First, they contend the trial court erred in finding, as a matter of law, that the relief they sought required judicial intervention in the management and operation of Antioch College. Second, they claim the trial court erred in finding, as a matter of law, that a “Faculty Personnel Policies and Procedures” manual constituted a personal-service contract. Third, they assert that the trial court erred in finding, as a matter of law, that they had an adequate remedy in the form of money damages for the breach of contract alleged in their amended complaint.
{¶ 3} The record reflects that the appellants filed their initial complaint on March 10, 2008. The filing was in response to the Antioch University Board of Trustees’ June 2007 declaration of a “financial exigency” and announcement that Antioch College would suspend its operations effective July 1, 2008 with an aspirational goal of reopening in four years. The appellants filed an amended complaint for specific performance and permanent injunctive relief on April 11, 2008.
{¶ 4} The amended complaint, which was the subject of the trial court‘s ruling, alleged that Antioch College is owned and operated by Antioch University, an Ohio non-profit corporation. The appellants alleged that their rights as tenured professors were governed by a manual entitled, “Faculty Personnel Policies and Procedures,” a copy of which was attached to the amended complaint. The appellants alleged that this manual constituted a contract between them and Antioch University. They further alleged that the decision by Antioch University‘s Board of Trustees to declare a financial exigency and to suspend the operation of Antioch
{¶ 5} Antioch University subsequently moved to dismiss the amended complaint pursuant to
{¶ 6} Before turning to the appellants’ assignments of error, we pause to address three issues raised by Antioch University on appeal that were not addressed by the trial court below:
{¶ 7} Upon review, we need not dwell on whether Antioch University properly preserved its standing argument.1 As tenured faculty members who lost their jobs when Antioch University suspended its operation of Antioch College in alleged breach of a contract, the appellants plainly have a personal stake in the outcome of the dispute. Middletown v. Ferguson (1986), 25 Ohio St.3d 71, 75. Therefore, they have standing. We also reject Antioch University‘s argument that the amended complaint did not state a claim because it failed to allege the existence of some “less drastic means” before the trustees declared a financial exigency. Antioch University contends it is irrelevant whether any less drastic means surfaced
{¶ 8} As for mootness, Antioch University raised this issue below in a supplemental filing, which the trial court did not address. In any event, mootness is an issue that may be raised at any time. “No actual controversy exists where a case has been rendered moot by an outside event,” and a moot appeal is subject to dismissal. Tschantz v. Ferguson (1991), 57 Ohio St.3d 131, 133. We note too that an appellate court may consider evidence outside the record in order to dismiss an appeal as moot. Pewitt v. Lorain Correctional Inst., 64 Ohio St.3d 470, 1992-Ohio-91 (dismissing a habeas petition as moot even though “the fact that appellant was released from confinement did not appear in the record or in any other cited source“). Acting sua sponte, an appellate court also may take judicial notice of facts generally known within its territorial jurisdiction or facts capable of accurate and ready determination by resort to sources whose accuracy reasonably cannot be questioned.
{¶ 10} It is certainly possible, however, to read the amended complaint as seeking a mandatory injunction, which is “an extraordinary remedy that compels the defendant to restore a party‘s rights through an affirmative action.” State ex rel. Gen. Motors Corp. v. Ohio Indus. Comm., 117 Ohio St.3d 480, 482, 2008-Ohio-1593. “The distinction between these two categories of injunctive relief can best be summed up as follows: a prohibitory injunction is used to prevent a future injury, but a mandatory injunction is used to remedy past injuries.” Id. at 482-483. If we read the amended complaint as seeking a mandatory injunction to compel Antioch University to reopen Antioch College and to rehire the appellants as tenured professors while taking some less drastic action to
{¶ 11} A potential problem arises, however, if we treat the amended complaint as seeking a mandatory injunction. The Ohio Supreme Court has recognized that a prohibitory injunction is an adequate remedy in the ordinary course of law. State ex rel. Evans v. Blackwell, 111 Ohio St.3d 1, 9, 2006-Ohio-4334; State ex rel. United Auto. Aerospace & Agricultural Implement Workers of Am. v. Ohio Bureau of Workers’ Comp., 108 Ohio St.3d 432, 441, 2006-Ohio-1327. A mandatory injunction, on the other hand, is an extraordinary remedy. Evans, 111 Ohio St.3d at 9, citing State ex rel. Fenske v. McGovern (1984), 11 Ohio St.3d 129, paragraph one of the syllabus. As such, it is not available where an alternative adequate remedy in the ordinary course of law exists. Buzzard v. Pub. Emp. Retirement Sys. of Ohio (May 9, 2000), 139 Ohio App.3d 632, 638.
{¶ 12} In the present case, the amended complaint alleges that in June 2007 Antioch University‘s Board of Trustees declared a state of financial exigency and announced plans to suspend its operation of Antioch College effective July 1, 2008. The appellants did not file the present action for permanent injunctive relief until March 10, 2008. Nor did their amended complaint include a request for preliminary injunctive relief. If they had acted more expeditiously,3 and if their substantive arguments were proven to be meritorious, they might have obtained a prohibitory injunction stopping Antioch University from closing Antioch College and terminating their employment before operations were suspended. The availability of such a remedy in the ordinary
{¶ 13} “Appellate review of a trial court‘s decision to dismiss a case pursuant to
{¶ 14} As a means of analysis, we turn first to the appellants’ second assignment of error. There they claim the trial court erred in finding that they were seeking specific performance of a personal-service contract. In other words, the appellants challenge the trial court‘s determination, based on its reading of the amended complaint, that they were trying to compel Antioch University to reemploy
{¶ 15} On appeal, the appellants do not dispute that the Faculty Personnel Policies and Procedures manual constituted their contract with Antioch University. Indeed, their amended complaint expressly makes such an allegation. The appellants also concede that “Ohio courts do not typically grant specific performance of the provisions of a contract for personal services.” Their sole argument is that the amended complaint did not seek an order requiring Antioch University to reemploy them. Rather, the appellants contend they merely sought an order requiring Antioch University “to specifically perform its contractual obligation to seek alternative means to alleviate the College‘s financial problems, rather than resorting to the most drastic means of closing the College[.]” The appellants posit that any less drastic means could include their loss of employment. Therefore, they insist that the amended complaint did not seek specific performance of a contract for personal services.
{¶ 16} Upon review, we find the appellants’ argument to be without merit. The relevant language in the Faculty Personnel Policies and Procedures manual is found in a section captioned, “Termination or Reduction of Faculty.” It provides that “[a]fter tenure, reappointment will be automatic unless there is: * * * ‘necessary and justifiable budget curtailment[.]‘” Paragraph 55 defines “necessary and justifiable budget curtailment” as “a state of financial exigency declared by the Board of Trustees * * * when it has been determined by exercising sound business judgment that conditions exist which can be alleviated only by significantly reducing faculty * * * salary expenditures and expenses at Antioch College for a prolonged and indefinite period of
{¶ 17} Read in context, paragraph 56‘s reference to “less drastic means” plainly refers to a solution less drastic than terminating or reducing faculty to decrease salary expenses pursuant to a declared financial exigency. But any money-saving approach less drastic than terminating or reducing tenured faculty necessarily would require retaining those employees. Therefore, insofar as the appellants seek an injunction requiring Antioch University to use “less drastic means” to alleviate the financial crisis at Antioch College, they necessarily seek specific performance of a contract for personal services. In short, they are attempting to compel Antioch University to rehire them and to solve its financial problems in some other way.
{¶ 18} To avoid this inescapable conclusion, the appellants assert that the Faculty Personnel Policies and Procedures manual requires Antioch University to alleviate its financial crisis by using less drastic means than suspending the operation of Antioch College. As noted above, they propose that any such means might require their termination. But this argument misinterprets the pertinent language. The manual requires Antioch University, when possible, to remedy a financial exigency by less drastic means than terminating the appellants’ employment. Again, such a means by definition would require retaining the appellants. Otherwise, it would not be less drastic than terminating them. Thus, we find no error in the trial court‘s conclusion that the amended complaint sought specific performance of a personal-service contract.
{¶ 19} The appellants admit that, in the absent of a statute entitling a former
{¶ 20} In their third assignment of error, the appellants contend the trial court erred in finding that they have an adequate remedy in the form of money damages. The appellants assert that money damages are insufficient to compensate them for the loss of their tenured positions as a result of Antioch University‘s alleged breach of the Faculty Personnel Policies and Procedures manual. In support, they argue that Antioch College “has been a leader in higher education in Ohio and its continued existence is
{¶ 21} Upon review, we are unpersuaded by the appellants’ argument. We addressed the same situation in Sokolowsky, holding that a tenured Antioch College faculty member could not obtain a permanent injunction seeking specific performance of his employment contract. We reached this conclusion for several reasons, including the fact that money damages constituted an adequate remedy if the faculty member proved a breach of contract. We see no reason to depart from this portion of Sokolowsky, which the appellants’ third assignment of error fails even to address.
{¶ 22} Finally, we are unpersuaded by the appellants’ reliance on Sashti, Inc. v. Glunt Indus., Inc. (N.D. Ohio 2001), 140 F.Supp.2d 813, and Ohio Dominican College v. Krone (1990), 54 Ohio App.3d 29, to support their argument. Sashti involved a contract for the sale of special goods that no other vendor could provide. The court held that the plaintiff stated a claim for specific performance because the goods were unique and because a statute provided for specific performance. Sashti is distinguishable because no similar statute provides for specific performance in the present case and because a tenured Antioch professor‘s loss of employment is compensable with money damages. Sokolowsky, supra; see, also, Cooke v. Dodge (N.Y. Sup. 1937), 164 Misc. 78, 81, 299 N.Y.S. 257, 261 (dismissing a tenured teacher‘s complaint for injunctive relief for failure to state a claim where, “even if it be assumed that the plaintiff has a valid agreement and a valid tenure of office and is subsequently and unlawfully discharged or prevented from performing it, he has an
{¶ 23} As for Krone, it involved a tenured college professor who was terminated from Ohio Dominican College. After finding that her termination was in breach of contract, and without any discussion of the right to specific performance of a personal-service contract, the Tenth District ordered the trial court “to institute appellant‘s reinstatement or, in the alternative, to determine the amount of damages.” Krone, 54 Ohio App.3d at 35. In the end, the professor was awarded money damages to compensate her for the breach of contract. See Ohio Dominican College v. Krone (Jan. 23, 1992), Franklin App. No. 90AP-1164. We see no reason why the appellants cannot be compensated similarly if Antioch University terminated their employment in breach of contract.5 The final paragraph of their amended complaint alleges the existence of irreparable harm and the absence of an adequate remedy at law. But the appellants have not identified, and we cannot envision, a set of facts supporting this legal conclusion. Accordingly, the third assignment of error is overruled.
{¶ 24} We turn next to the appellants’ first assignment of error. There they contend the trial court erred in finding that the relief they sought required judicial intervention in the management and operation of Antioch College.
{¶ 26} Upon review, we conclude that the trial court improperly dismissed the appellants’ complaint under
{¶ 27} In short, the amended complaint presented a routine breach-of-contract claim with a request for specific performance and injunctive relief. The trial court
{¶ 28} We are not persuaded otherwise by the trial court‘s citation to the Faculty Personnel Policies and Procedures manual, case law addressing the business-judgment rule, and our prior ruling in Sokolowsky. The manual authorized Antioch University‘s Board of Trustees to exercise “sound business judgment” to determine whether a reduction in faculty was necessary to alleviate a financial crisis. Nowhere, however, does the manual state that the trustees’ judgment is unreviewable. Similarly, the business-judgment rule merely creates a rebuttable presumption that corporate directors act in good faith and in the best interest their company when making
{¶ 29} “The record here shows that because Antioch was facing a financial crisis, its Trustees decided to decrease the expenses incident to the employment of faculty and to reorganize its academic program.
{¶ 30} “It is not within the province of the Courts to enter upon the business of trying to direct and supervise the operation of private colleges. Because it would be too burdensome to the Courts to supervise the operation of Antioch College in accordance with reduced revenues, because Appellant has an adequate remedy at law by way of damages and because there is no mutuality of obligation or remedy between the parties hereto, we see no error in the action of the Common Pleas Court in refusing to enjoin Antioch from discharging the Appellant.”
{¶ 31} Our ruling in Sokolowsky does not specify whether the trial court‘s dismissal was pursuant to
{¶ 32} In any event, the trial court‘s concerns in the present case about the propriety of interfering in Antioch‘s management and operations did not deprive it of subject-matter jurisdiction. Those concerns constituted only a potential reason to deny the appellants’ request for specific performance. “Cases have been numerous in which a decree [for specific performance] has been refused on the ground that the performance required is one of long duration and its enforcement would involve long continued supervision by the court.” Corbin on Contracts (Interim Ed.), vol. 12, section 117, p. 318. But “[i]t is perfectly clear that difficulty of supervision does not deprive the court of jurisdiction[.]” Id. at 326. Rather, “it is a matter to be weighed with a wise discretion as the court exercises its judicial power.” Id. Therefore, the trial court erred in dismissing the appellants’ amended complaint pursuant to
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GRADY, J., and FROELICH, J., concur.
(Hon. William H. Wolff, Jr., retired from the Second District Court of Appeals, sitting by assignment of the Chief Justice of the Supreme Court of Ohio).
Copies mailed to:
W. Evan Price II
Michael R. Goodstein
Sabrina Haurin
Kathleen M. Trafford
Kendall V. Shaw
William R. Groves
Hon. Stephen A. Wolaver