Andrews v. Richmond Redevelopment & Hous. Auth., 787 S.E.2d 96, 292 Va. 79 (2016)

June 2, 2016 · Supreme Court of Appeals of Virginia · Record No. 150977
787 S.E.2d 96, 292 Va. 79

Yvonne Harris Andrews
v.
Richmond Redevelopment and Housing Authority

Record No. 150977

Supreme Court of Virginia.

June 2, 2016

Henry W. McLaughlin ; Drew D. Sarrett (Law Office of Henry McLaughlin, on briefs), Richmond, for appellant.

Robert W. Loftin (Christopher M. Michalik ; Summer L. Speight ; McGuireWoods, on brief), Richmond, for appellee.

Present: All the Justices

OPINION BY JUSTICE ELIZABETH A. McCLANAHAN

**81Yvonne Harris Andrews challenged the termination of her employment with the Richmond Redevelopment and Housing **82Authority (RRHA) through RRHA's grievance procedure and a hearing officer ordered her reinstatement. On RRHA's appeal, the circuit court reversed the hearing officer's decision as " 'contradictory to law' " under Code § 2.2-3006. In the present appeal, Andrews contends Code § 15.2-1507 is controlling, and under this statute the circuit court lacked subject matter jurisdiction to hear RRHA's appeal. We conclude the circuit court did lack subject matter jurisdiction, but based on the applicable provisions of both Code §§ 2.2-3006 and 15.2-1507, and thus reverse the judgment of the circuit court.

I. BACKGROUND

Andrews was employed by RRHA as a senior property manager of a public housing complex in the City of Richmond. RRHA terminated Andrews' employment based on its determination that she had committed several violations of RRHA's Standards of *98Conduct Policy No. 3.1 ("Standards of Conduct"). Andrews challenged the termination under RRHA's Grievance Policy No. 3.2 ("Grievance Policy") by claiming that RRHA had unfairly applied the Standards of Conduct to her.1 After exhausting the internal remedies available under the Grievance Policy, Andrews requested a hearing before an administrative hearing officer. Following a three-day hearing, the hearing officer issued a decision ruling that RRHA had improperly applied its personnel policies and procedures, and had thereby acted in bad faith in terminating Andrews' employment. The hearing officer thus ordered that Andrews be reinstated to her former position with full back pay. The hearing officer then advised at the conclusion of her decision that, under the terms of RRHA's Grievance Policy, "[e]ither party may ... appeal the decision to the Circuit Court of the City of Richmond, Virginia." See RRHA Grievance Policy, Section VII.E. ("Challenges to the Hearing Officer's Decision").

RRHA, "pursuant to Code § 2.2-3006 " of Virginia's State Grievance Procedure (Code §§ 2.2-3000 through -3008) ("State **83Grievance Procedure"),2 appealed the hearing officer's decision to the Circuit Court of the City of Richmond.3 As asserted in RRHA's notice of appeal, "[r]ather than apply RRHA's unambiguous written policies and procedures, the hearing officer unilaterally created new policies and procedures and/or rewrote RRHA's existing policies and procedures and applied those newly created or rewritten requirements. In doing so, the hearing officer's decision exceeded her statutory authority and, therefore, was contradictory to Virginia law." Specifically, RRHA contended that the decision ignored Code § 15.2-1507(A)(10)(a)(6), which, RRHA argued, "limit[ed] [the] hearing officer's authority by requiring that ... her decision 'be consistent with provisions of law and written policy.' "4 RRHA made these same assertions in its supporting brief filed with the circuit court and at oral argument. RRHA therefore asked the circuit court to reverse the hearing officer's decision.

Opposing RRHA's appeal, Andrews argued in its brief and at oral argument that the hearing officer correctly interpreted RRHA's personnel policies and procedures, and in particular RRHA's Standards of Conduct; and that the record supported the hearing officer's findings and disposition of her grievance. Andrews, however, did not argue that the circuit court lacked subject matter jurisdiction to hear RRHA's appeal.

The circuit court ruled in favor of RRHA and reversed the hearing officer's decision. The court determined that it was "vest[ed] [with] jurisdiction to 'hear the appeal on the record' " under Code § 2.2-3006. The court then ruled that the hearing officer erred in her interpretation and application of RRHA's disputed personnel policies and procedures. In doing so, the court agreed **84with RRHA that the hearing officer was "required to render a decision 'consistent with provisions of law and written policy' " under Code § 15.2-1507(A)(10)(a)(6) ; and that "the hearing officer's decision here is 'contradictory to law' under Va. Code § 2.2-3006." Accordingly, *99the court entered a final order denying the grievance.

Andrews appealed the circuit court's decision to the Court of Appeals of Virginia challenging the merits of that decision. The Court of Appeals concluded, however, that it lacked subject matter jurisdiction to decide the appeal under Code § 17.1-405 and transferred the case to this Court under Code § 8.01-677.1. Andrews then filed a petition for appeal to this Court. There, Andrews raised the additional argument in her first assignment of error that the circuit court lacked subject matter jurisdiction to consider RRHA's appeal of the hearing officer's decision. We granted Andrews this appeal limited solely to the jurisdictional issue.

II. ANALYSIS

A. Raising Subject Matter Jurisdiction

Andrews did not waive her jurisdictional challenge to the circuit court's decision by raising it for the first time on appeal. "Subject matter jurisdiction is the authority granted to a court by constitution or by statute to adjudicate a class of cases or controversies." Earley v. Landsidle , 257 Va. 365, 371, 514 S.E.2d 153, 156 (1999) (citing Morrison v. Bestler , 239 Va. 166, 169, 387 S.E.2d 753, 755 (1990) ). Under settled principles, such jurisdiction "cannot be conferred on the court by the litigants" and a challenge to it "cannot be waived." Virginian-Pilot Media Cos. v. Dow Jones & Co., 280 Va. 464, 468, 698 S.E.2d 900, 902 (2010) (citing In re: Commonwealth , 278 Va. 1, 11, 677 S.E.2d 236, 240 (2009) ). Furthermore, "lack of subject matter jurisdiction may be raised at any time, in any manner, before any court, or by the court itself." Nelson v. Warden of the Keen Mt. Corr. Ctr. , 262 Va. 276, 281, 552 S.E.2d 73, 75 (2001) (citation and internal quotation marks omitted); see Humphreys v. Commonwealth , 186 Va. 765, 772, 43 S.E.2d 890, 893 (1947) (same).

**85B. Standard of Review

The present dispute over subject matter jurisdiction concerning whether the circuit court had the statutory authority to entertain RRHA's grievance appeal presents an issue of law, which we review de novo. See Glasser & Glasser, PLC v. Jack Bays, Inc. , 285 Va. 358, 369, 741 S.E.2d 599, 604 (2013) (challenge to trial court's subject matter jurisdiction involved an issue of law subject to de novo review); see also REVI, LLC v. Chicago Title. Ins. Co. , 290 Va. 203, 208, 776 S.E.2d 808, 810 (2015) (question of statutory interpretation is subject to de novo review (citing Eberhardt v. Fairfax County Emples. Ret. Sys. Bd. of Trs. , 283 Va. 190, 194, 721 S.E.2d 524, 526 (2012) )). We conclude as a matter of law that the circuit court lacked subject matter jurisdiction under Code § 2.2-3006 to hear the appeal.

C. Code § 15.2-1507

Andrews argues that her grievance under RRHA's Grievance Policy was controlled by Code § 15.2-1507 and that this statute did not give RRHA the right to seek judicial review of the hearing officer's decision (contrary to the express terms of Section VII.E. of the Grievance Policy).5 As for RRHA's contention that the circuit court's jurisdiction was controlled instead by Code § 2.2-3006, Andrews argues that this statute, as part of the State Grievance Procedure, has no application to the grievance procedure set forth in Code § 15.2-1507 for local governments and other non-state entities, including redevelopment and housing authorities like RRHA. We disagree with Andrews' reading of these statutes.

*100The focus of Code § 15.2-1507 is on the "components and features" that are required by the statute to be incorporated in the grievance procedures adopted by "local governments" or "localities"

**86(i.e., counties, cities and towns) for their employees.6 Code § 15.2-1507(A). In addressing such grievance procedures, the statute also makes provision for grievance procedures for employees of, among other entities, redevelopment and housing authorities.7 Subsection (A)(4) of the statute provides, in relevant part:

Grievance procedure availability and coverage for employees of ... redevelopment and housing authorities.... Employees of ... redevelopment and housing authorities created pursuant to § 36-4 ... shall be included in (i) a local governing body's grievance procedure ... if agreed to by the ... authority and the locality or (ii) a grievance procedure established and administered by the ... authority which is consistent with the provisions of Chapter 30 (§ 2.2-3000 et seq.) of Title 2.2 [the State Grievance Procedure] and any regulations promulgated pursuant thereto. If [an] ... authority fails to establish a grievance procedure pursuant to clause (i) or (ii), it shall be deemed to have adopted a grievance procedure which is consistent with the provisions of Chapter 30 (§ 2.2-3000 et seq.) of Title 2.2 and any regulations adopted pursuant thereto for so long as it remains in noncompliance.

Code § 15.2-1507(A)(4) (emphasis added).

In construing Code § 15.2-1507(A)(4), " 'we must apply its plain meaning, and we are not free to add [to] language, nor to ignore language, contained in [it].' " Kiser v. A.W. Chesterton Co. , 285 Va. 12, 25, 736 S.E.2d 910, 918 (2013) (quoting BBF, Inc. v. Alstom Power, Inc. , 274 Va. 326, 331, 645 S.E.2d 467, 469 (2007)

**87internal quotation marks omitted)). That is to say, " '[w]hen the legislature has used words of a plain and definite import the courts cannot put upon them a construction which amounts to holding the legislature did not mean what it has actually expressed.' " Id. (quoting Barr v. Town & Country Props., Inc. , 240 Va. 292, 295, 396 S.E.2d 672, 674 (1990) (internal quotation marks omitted)).

A plain reading of subsection (A)(4) compels the conclusion that RRHA's grievance procedure is not controlled by Code § 15.2-1507, but instead by the State Grievance Procedure. When RRHA opted to have its own grievance procedure as permitted under the second option in subsection (A)(4)-rather than entering into an agreement with the City of Richmond for RRHA's inclusion in the City's grievance procedure as permitted under the first option in subsection (A)(4)-RRHA was explicitly required by this subsection to establish and administer its grievance procedure "consistent with" the State Grievance Procedure. Nothing in the language of subsection (A)(4) indicates that RRHA's grievance procedure must also be "consistent with" the grievance procedure set forth in the other provisions of Code § 15.2-1507 specifically established for local governments.

Indeed, RRHA's Grievance Policy could not function coherently under a conflated application of the separate statutory schemes set forth in Code § 15.2-1507 and the State Grievance Procedure. The operative word "consistent" used in the second option in Code § 15.2-1507(A)(4) means "coexisting and showing no noteworthy opposing, conflicting, inharmonious, or contradictory qualities or trends." Webster's Third New International *101Dictionary 484 (1993). RRHA's Grievance Policy cannot be "consistent with" both statutory schemes because of their divergent features, the most significant of which, for purposes of this case, are their different provisions concerning the right to judicial review of a hearing officer's decision. (Judicial review under Code § 2.2-3006 of the State Grievance Procedure is addressed in Subsection II.D. below.) We thus eschew a construction of Code § 15.2-1507(A)(4) that would embrace such a hybrid statutory apparatus for controlling the establishment and administration of a redevelopment and housing authority's own grievance procedure. In construing statutes, this Court has repeatedly adhered to the principle, as we do here, that "[t]he plain, obvious, and rational meaning of a statute is **88to be preferred over any curious, narrow, or strained construction." Deutsche Bank Nat'l Trust Co. v. Arrington , 290 Va. 109, 116, 772 S.E.2d 571, 574 (2015) (citation and internal quotation marks omitted).

We thus conclude that the question whether the circuit court had subject matter jurisdiction to entertain RRHA's appeal of the hearing officer's decision is controlled by the provisions of Code § 2.2-3006 of the State Grievance Procedure.

D. Code § 2.2-3006

As part of the State Grievance Procedure addressing the review of a hearing officer's decision, Code § 2.2-3006 provides, in relevant part, in subsections (A) and (B):

A. Upon the request of a party to a grievance hearing for an administrative review of the hearing decision, the Director of the Department of Human Resource Management shall determine, within 30 days of the conclusion of any other administrative reviews, whether the hearing decision is consistent with policy .
B. Within 30 days of a final decision, [either] party may appeal on the grounds that the determination is contradictory to law by filing a notice of appeal with the clerk of the circuit court in the jurisdiction in which the grievance arose.... Within 30 days of receipt of the grievance record, the court, sitting without a jury, shall hear the appeal on the record. The court may affirm the decision or may reverse or modify the decision....

(Emphases added.)

These provisions make clear that either party may appeal a hearing officer's decision to circuit court for review on grounds that it is "contradictory to law," Code § 2.2-3006(B), but no such right is available when the challenge to the decision presents a question whether it is "consistent with policy," Code § 2.2-3006(A). This review procedure, as so devised, "allows the executive branch latitude to manage and discipline [its] employees and to develop its own policy and procedures, subject to limited **89legal constraints." Burke v. Catawba Hosp. , 59 Va.App. 828, 834, 722 S.E.2d 684, 687 (2012).8 As we explained in Virginia Polytechnic Institute & State University v. Quesenberry , 277 Va. 420, 430, 674 S.E.2d 854, 859 (2009), " 'the hearing officer is to act as fact finder and the Director of the Department of Human Resource Management [DHRM] is to determine whether the hearing officer's decision is consistent with policy. In the grievance process, neither of these determinations is subject to judicial review, but only that part of the grievance determination 'contradictory to law. ' " Id. (quoting Virginia Dept. of State Police v. Barton , 39 Va.App. 439, 445, 573 S.E.2d 319, 322 (2002) (emphasis added) (some internal quotation marks omitted)); see Commonwealth v. Needham , 55 Va.App. 316, 327, 685 S.E.2d 857, 863 (2009) ("Under the State Grievance Procedure, an appeal from a hearing officer's interpretation of policy goes to the director of [DHRM], not the circuit court." (citing Code § 2.2-3006(A) )). Thus, the circuit court has a "very narrow" standard of review that "focuses solely on the question whether the hearing officer's decision is contradictory to any applicable law," i.e., " '[a] constitutional provision, statute, regulation or judicial decision.' " *102Quesenberry , 277 Va. at 429, 674 S.E.2d at 858 (quoting Tatum v. Virginia Dep't. of Agric. , 41 Va.App. 110, 122, 582 S.E.2d 452, 458 (2003) ).

Here, RRHA, citing Code § 2.2-3006, challenged the hearing officer's decision to reinstate Andrews by appealing the decision to the circuit court and arguing that it was "contradictory to law." As the appealing party, it was RRHA's burden to identify how "the law [was] thereby contradicted." Quesenberry , 277 Va. at 429, 674 S.E.2d at 858. RRHA, however, pointed only to subsection (A)(10)(a)(6) of Code § 15.2-1507 -a provision which is inapplicable to RRHA's Grievance Policy, for the reasons explained above-thereby erroneously conflating Code § 15.2-1507 with Code § 2.2-3006.

Moreover, RRHA did not make a prima facie showing for invoking judicial review of the hearing officer's decision under **90Code § 2.2-3006(B) because the substance of RRHA's appeal challenged only the hearing officer's interpretation and application of RRHA's policies. As expressly asserted in RRHA's notice of appeal, the hearing officer failed to "apply RRHA's unambiguous written policies and procedures, ... unilaterally created new policies and procedures and/or rewrote RRHA's existing policies and procedures [,] and applied those newly created or rewritten requirements." RRHA argued, more specifically, in its legal memorandum that the hearing officer erroneously determined that:

(1) RRHA had an obligation to utilize progressive discipline in every instance (RRHA policy does not state as much); (2) the direct supervisor (as opposed to [RRHA's chief operating officer] ) had to recommend the termination (no RRHA policy states that); (3) RRHA did not give Andrews sufficient time to dispute her discipline (RRHA policy does not provide for such a time); and (4) RRHA had an obligation to "document" its performance concerns (no policy states as much).

RRHA then made the same arguments to the circuit court at oral argument. Based on such a challenge to the hearing officer's decision, RRHA was limited, pursuant to Code § 2.2-3006(A), to a review of that decision by RRHA's executive director or other designated person within the organization, who would be comparable to the director of DHRM as the designated person to conduct such a review under subsection (A) at the state level.9

The circuit court therefore did not have subject matter jurisdiction to entertain RRHA's appeal under Code § 2.2-3006 **91because the statute did not grant the court the authority to review a case or controversy of this nature.10 See Burke , 59 Va. App. at 833-35, 722 S.E.2d at 687-88 (affirming, based on *103Code § 2.2-3006, circuit court's holding that "it was without jurisdiction to review 'the matters of policy presented in th [e] appeal' " of a hearing officer's decision to uphold the grievant's termination of employment); Barton , 39 Va.App. at 444-48, 573 S.E.2d at 322-24 (reversing, based on Code § 2.1-116.07:1 (recodified as amended at Code § 2.2-3006 ), a circuit court's decision on appeal to dismiss a hearing officer's three-day suspension of a state trooper because the circuit court was without jurisdiction to entertain the appeal where the conflict was over the interpretation of agency policy).

III. CONCLUSION

We hold that the circuit court lacked subject matter jurisdiction under the controlling statute, Code § 2.2-3006, to entertain RRHA's appeal of the hearing officer's decision. Accordingly, we reverse the judgment of the circuit court, reinstate the hearing officer's decision, and dismiss the appeal.

Reversed and dismissed .