MONTGOMERY-REEVES, Vice Chancellor.
This action is an appeal filed under 19 Del. C. § 1609 by Appellant, the City of Wilmington (the "City"), from a decision by the Public Employment Relations Board ("PERB" or the "Board") affirming the decision of a binding interest arbitrator (the "Arbitrator") in the parties' collective bargaining negotiations.
Seven statutory factors guide the Arbitrator's determination of which offer to choose. One of those factors requires the Arbitrator to compare the costs and benefits of the parties' offers to those enjoyed by other police officers doing similar work in a comparable community. This appeal arises primarily from the Arbitrator's choice of a comparable bargaining unit, which he supported by taking judicial notice of his personal knowledge of proposed communities without giving the parties notice and a chance to be heard. As a result, at least two of the seven statutory factors appear to have been decided in favor of Lodge 1 based on the arbitrator's improper selection of a comparable bargaining unit. Because it is unclear whether the Arbitrator's ultimate selection of an offer would have differed absent his error, the Board and the Arbitrator are reversed. This matter is remanded for further proceedings consistent with this opinion.
The City is a public employer within the meaning of Section 1602(p).
Lodge 1, an employee organization within the meaning of Section 1602(g),
On May 3, 2011, Lodge 1 and the City executed a collective bargaining agreement for the term of July 1, 2010 to June 30, 2011. In January 2012, Lodge 1 advised the City of its intent to negotiate changes to the then-existing agreement. Between February 3, 2012 and January 31, 2014, the parties met on eight occasions and exchanged offers in a good-faith effort to negotiate a new agreement.
By letter dated December 11, 2014, the Board's Executive Director directed the parties to submit their last, best, final offers by January 9, 2015, which the parties did on that date. The Board certified the parties' collective bargaining impasse to binding interest arbitration on February 10, 2015 and later appointed Ralph H. Colflesh, Esq. to serve as the Arbitrator.
An impasse in collective bargaining that the Board advances to arbitration is resolved through the application of seven statutory factors.
The Arbitrator found that, with respect to Section 1615(d)(2) and (3), the parties produced ample evidence.
With respect to Section 1615(d)(2), the Arbitrator chose "the New Castle County Police . . . to be the closest comparators to [Lodge 1's] Rank and File ("R&F") bargaining unit in the record."
The Arbitrator explained that the New Castle County Police Department ("NCCPD" or the "County Police Department") is the closest comparator because the Wilmington Police Department and the County Police Department have roughly the same number of officers, their officers are "sworn in as members of each others' department, the proximity of the two departments and the fact that police work is not significantly differentiated between cities and their close-in neighbors . . . ."
Finding that "the evidence, taken as a whole, when applied to the criteria found at 19 Del. C. 1615(d)(1)-(7) leads to a determination that [Lodge 1's offer] should be accepted in its entirety," the Arbitrator concluded that Lodge 1's offer "better meets the joints [sic] needs of the officers and the public" and entered an award accordingly.
On October 19, 2015, the City filed its Request for Review with the Board. At a hearing on November 18, 2015, the City argued, among other things, that the Arbitrator erred in considering the County Police Department as the only bargaining unit comparable to the Wilmington Police Department. The Board rejected the City's argument and affirmed the Decision on December 21, 2015.
On January 4, 2016, the City filed its Notice of Appeal, which asserted that the Board erred as a matter of law, erred as a matter of fact, acted in an arbitrary and capricious manner, and failed to support its affirmance with substantial evidence. On January 5, 2016, the City moved to stay implementation of the Decision. After full briefing, the Court heard argument on the City's appeal and the motion to stay on April 7, 2016. On April 15, 2016, the parties agreed to stay implementation of the Decision pending resolution of this appeal. This opinion constitutes the Court's ruling on the City's appeal from the Board's December 21, 2015 Decision.
This appeal focuses on two issues: (1) whether the Board erred as a matter of law when it affirmed the Arbitrator's choice of a comparable bargaining unit based on information of which he purportedly took improper judicial notice, and (2) whether the Board erred as a matter of law when it affirmed the Arbitrator's misapplication of one statutory factor and improper weighing of all seven factors in reaching his Decision.
Regarding the first issue, the City argues that the Arbitrator erred when he took judicial notice of evidence outside the record without notifying the parties and giving them an opportunity to be heard. The Arbitrator committed further error, the City contends, when he determined that the County Police Department is far more comparable to the Wilmington Police Department than it is to regional, urban police departments based on this improper judicial notice. Accordingly, the City argues, that the Board erred in affirming the Arbitrator's errors.
Lodge 1 responds that the Arbitrator's judicial notice was not improper because the Arbitrator (1) did not rely on the information to conclude that the County Police Department was the closest comparable to the Wilmington Police Department, (2) supported his conclusion with ample alternative evidence, and (3) did not take affirmative steps to acquire the outside information. Accordingly, Lodge 1 argues that, because the Arbitrator did not err as a matter of law, neither did the Board in affirming the Decision.
Regarding the second issue, the City asserts that the Arbitrator erred in applying Section 1615(d)(2) and in weighing all seven Section 1615(d) factors. The City contends that the Arbitrator misinterpreted or misapplied Section 1615(d)(2) by failing to consider whether Wilmington and New Castle County are comparable communities as required by the statute. The City also avers that the Arbitrator weighed the seven statutory factors improperly by failing to give due weight to both the duration of its offer and the impact of limiting compensatory time absences on the public interest. Accordingly, the City contends, the Board erred in affirming the Arbitrator's errors.
In response, Lodge 1 argues that the Arbitrator interpreted and applied Section 1615(d)(2) correctly when he observed that the County Police Department and the Wilmington Police Department are cross-sworn and that case precedent supports finding they are comparables. Lodge 1 further avers that both the Arbitrator and the Board weighed the seven factors properly, but accorded little weight to those that the City raised and rejected the City's argument that its duration and compensatory time absences proposals justified selecting the City's offer over Lodge 1's.
"On appeal of an administrative agency's adjudication, this Court's sole function is to determine whether the [agency's] decision is supported by substantial evidence and is free from legal error."
"Delaware courts do not accord agency interpretations of the statutes which they administer so-called Chevron
The primary dispute in this matter concerns whether the Board committed an error of law when it affirmed the Arbitrator's choice of a comparable bargaining unit under Section 1615(d)(2) based on information of which he took judicial notice.
Under Delaware Rule of Evidence 201, "[a] judicially noticed fact must be one not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned."
Whether Wilmington is comparable to proposed communities geographically and economically not only is subject to reasonable dispute, but also was central to the parties' dispute in the Hearing. And, because the Arbitrator cites only his personal experience working as a labor lawyer or arbitrator in the communities he lists, it is dubious from the outset how the facts he takes notice of are "generally known within the territorial jurisdiction." Moreover, many of his personal observations are not facially capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned. In fact, the Arbitrator refers to no sources.
Generally, basing a decision on information or evidence outside the record, without complying with D.R.E. 201, "constitutes a due process violation."
Lodge 1 argues that there is no indication the Arbitrator relied on the information. Specifically, Lodge 1 contends that the Arbitrator's statement regarding out-of-state communities was legally inconsequential because seven findings supported his decision that the County Police Department was the closest comparable to Lodge 1: (1) the County Police Department and Lodge 1 are cross-sworn; (2) the departments are close to each other and "police work is not significantly differentiated between cities and their close-in neighbors;" (3) the departments have about the same number of officers; (4) the "Delaware State Police is less comparable because it has more than twice as many officers" as Lodge 1 and is characterized more accurately as a highway patrol than a municipal force; (5) the County Police Department "is more comparable than out-of-state agencies located in [Pennsylvania] and [New Jersey], as those communities are unlike Wilmington geographically and economically;" (6) "Dover's population, size of police force, and per-capita income advantage make it less of a comparable;" and (7) "in a recent [binding interest arbitration] case involving the [Lodge 1's] Captains and Inspectors Unit, the City proposed and stipulated that [the County Police Department] was a useful comparable."
Lodge 1's argument fails, however, because each additional finding that Lodge 1 lists either restates that the County Police Department and the Wilmington Police Department perform similar work or is not the "substantial evidence" required to support the Arbitrator's conclusion that New Castle County and Wilmington are comparable communities. As described in the decisions and the briefs, the first and second findings listed above are substantively the same and both boil down to "police do similar work." Not only does the City concede that "[t]here is no basis for disputing that the services performed by police officers in most police departments, including the WPD and the NCCPD, is similar,"
With respect to the third, fourth, and sixth findings, Lodge 1 contends that the record contains facts supporting the Arbitrator's conclusion that Wilmington and New Castle County are comparable communities. After striking the improperly noticed information, however, the Arbitrator's conclusion is not supported by substantial evidence in this regard. For example, among New Castle County, Reading, Vineland, and Dover, the Comparables Chart shows that Vineland is most comparable to Wilmington in terms of population, population growth, per capita income, and median home value, and Vineland is not least comparable in any category.
Next, the fifth "finding"—that New Castle County is more comparable to Wilmington geographically and economically than communities in other states—is the result of the Arbitrator's improper notice. Lodge 1 does not cite competent evidence in the record supporting the Arbitrator's conclusion that out-of-state communities like Reading and Vineland are unlike Wilmington geographically and economically.
The seventh finding also fails to support the Arbitrator's conclusion. Lodge 1 argues, and the Arbitrator and the Board noted, that the Arbitrator's findings were consistent with precedent, but I read Fraternal Order of Police, Lodge #1 and the City of Wilmington ("Captains & Inspectors")
Lodge 1 also contends that Fraternal Order of Police, Lodge No. 4 v. City of Newark
This precedent is easily distinguishable. First, the demographics used from 2000 are no longer current. Second, and perhaps more importantly, because Newark had the smallest population, the smallest area, the smallest number of sworn personnel, and the smallest budget of the proposed comparables, Dover was literally the only comparable in every respect. Here, because Wilmington is neither the largest nor the smallest community considered, its comparable could be larger or smaller on a factor-by-factor basis. Just because Dover was Newark's only comparable a decade ago does not mean that neither Dover nor Newark is most comparable to Wilmington today on a factor-by-factor basis.
The City asserts that the Arbitrator's judicial notice in this case is the same error that the arbitrator committed in State of Delaware, Office of Management and Budget v. Public Employment Relations Board ("OMB").
As an alternative to OMB, Lodge 1 argues that the Arbitrator's statement at issue here is more akin to the one at issue in Delaware Alcoholic Beverage Control Commission v. Alfred I. duPont School District.
In conclusion, the Arbitrator improperly took judicial notice of information outside the record without providing the parties notice and an opportunity to respond, and no recognized exception excuses this error. The Arbitrator's improper judicial notice constituted his only written analysis of whether the Wilmington and New Castle County communities are comparable. Thus, the Arbitrator committed a reversible error, as did the Board in affirming him.
Accordingly, the Court reverses and remands this appeal to the Board with instructions to remand the Decision to the Arbitrator for further proceedings consistent with this opinion.
Two issues remain. First, the City argues that the Board erred by affirming the Arbitrator's misapplication of the Section 1615(d)(2) factor, which requires the Arbitrator to choose a comparable bargaining unit that both does similar work and is located in a comparable community. Second, the City argues that the Arbitrator weighed the seven Section 1615(d) factors improperly by ignoring the duration and compensatory time absence components of its offer and that the Board erred in affirming the Arbitrator's error.
The Court concluded above that the Arbitrator and the Board committed errors of law when they chose the County Police Department as a comparable based on judicial notice taken without providing the parties notice and a chance to be heard. Here, however, the Court hesitates to apply Section 1615(d)(2) on its own in choosing which of the proposed comparables is most comparable to the Wilmington Police Department. The statute commits that task to the Arbitrator. Similarly, and for the additional reason that the Court cannot predict the Arbitrator's conclusion with respect to Section 1615(d)(2) on remand, the Court will not itself weigh the seven statutory factors.
For the foregoing reasons, the Board's decision to affirm the Arbitrator's improper judicial notice is reversed and remanded to the Board with instructions to remand the Decision to the Arbitrator for further proceedings consistent with this opinion.
Id.
