CHARTER SCHOOL CONTRACTUAL ISSUES

Orange County School of the Arts v. Santa Ana USD – California Court of Appeal, Second District (Case No. B332826)

MEMBER(S) INVOLVED: Santa Ana Unified School District

IMPORTANCE OF STATEWIDE ISSUE:

Generally, under the Charter Schools Act of 1992, as amended, a charter school may be established upon the granting of a petition by a local school governing board or county board of education (the charter authorizer), based on criteria specified in law. When granted, a charter school must be operated in accordance with law and the provisions of its charter. Within this procedural scheme, questions have arisen as to whether a charter (1) creates contractual obligations that are enforceable against the charter authorizer (school governing or county board) or (2) is akin to local legislation in the same vein as a city ordinance that may be binding on the authorizer. In addition, may the terms of a charter petition override a requirement of law?
SUMMARY OF THE CASE:

For close to 20 years, the Orange County School of the Arts (OCSA), a charter school authorized by Santa Ana USD (District), operated as a district school for special education purposes. As a result, the District was responsible for providing students with disabilities who were enrolled by OCSA special education services, including a free appropriate public education as required by law.

Over that period, the District failed to require OCSA to financially support the districtwide special education instruction and services by paying an equitable share of OCSA’s charter school block grant, as required by law. When the District eventually sought to recover those payments, OCSA filed a Writ of Mandate and complaint against the District, arguing that the District’s general fund support claims were unenforceable and that the District’s demand was barred by certain equitable doctrines. The District also filed a cross-complaint seeking pre-judgment interest on the amount owed by OCSA. The trial court ruled in favor of the District and OCSA appealed.

In its appeal, OCSA asserts that:

  • The District’s approval of the charter provisions via formal resolution was a quasi-legislative act that created a duty on the part of the District that is enforceable via Writ of Mandamus,
  • Equitable estoppel prevents enforcement of the District’s invoices because the District did not follow the procedures it had agreed to follow in order to induce OCSA to continue using the District’s special education services, and
  • The District has a contractual duty to follow the procedures that were negotiated and mutually agreed upon by the parties.
CURRENT STATUS AND/OR OUTCOME:
The ELA will file an amicus brief in support of District and the trial court’s decision before the appellate court. ELA’s brief will address questions related to the characterization of a charter as a contract and local legislation.
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