BROWN v. JAMES (2010)

Sharon Brown (Brown) appeals the circuit court's decision granting District Superintendent William B. James' (James) motion for summary judgment regarding her action against him for violating her rights under the South Carolina Teacher Employment and Dismissal Act (Employment and Dismissal Act).¹ Brown asserts that (1) the circuit court abused its discretion when concluding she had not exhausted her administrative remedies; (2) the circuit court misinterpreted the Employment and Dismissal Act; (3) she had a legal right to appeal directly to the circuit court because the Board of Trustees (Board) had already reached a final decision regarding the nonrenewal of her contract; and (4) the circuit court abused its discretion when concluding that her motion to amend her complaint to add parties was moot. We reverse and remand.

FACTS

Brown was a teacher, assigned to Limestone Central Elementary School (Limestone) in Cherokee County, South Carolina, for the 2006-2007 school year. Brown had been a teacher at Limestone for eight years before she filed this action. On April 10, 2007, Brown was called to the Cherokee County School District (District) office to meet with Mr. William A. Jones (Jones), Chief Administrative Officer/Director of Personnel for the District. Jones and Brown discussed an “improvement letter” Brown had received from Limestone's Principal, Sharon Jefferies, and the fact that Brown had filed a sexual harassment complaint with the Equal Employment Opportunity Commission against Jefferies.² Brown informed Jones that she had planned to file the sexual harassment complaint even before she received the improvement letter.³ Jones told Brown she could either go back to work or take Family Medical Leave due to the “hostile/threatening” work environment. Brown chose to take the leave because Jones told her she would be paid until the end of her contract year, which was July 2007. Jones then informed Brown that he was going to recommend that her teaching contract not be renewed and advised her to resign.

Subsequently, Brown received a letter dated April 12, 2007, from District Superintendent James, stating that at the school principal's recommendation, her contract for the upcoming year would not be renewed. Brown retained attorney Theo W. Mitchell (Attorney Mitchell), and within fifteen days of the April 12, 2007 notice, she submitted a written request for an opportunity to be heard under the Employment and Dismissal Act. The Board received Brown's request on April 27, 2007. However, on April 24, 2007, James recommended to the Board that Brown's teaching contract not be renewed, and the Board voted to terminate Brown's contract that same day. The Board did not inform Brown of its decision.

Even though the Board had already made its final determination regarding Brown's contract, the Board asked Attorney Mitchell if Brown would waive the fifteen-day requirement for scheduling the hearing to give it an opportunity to discuss the matter. Brown agreed to the waiver. The Board then notified Attorney Mitchell that it wanted to depose Brown before the hearing.

Subsequently, Attorney Mitchell informed the Board that Brown would not be available for a deposition prior to a hearing. Thereafter, on two separate occasions, the Board informed Attorney Mitchell that if it did not receive a response from either Brown or him regarding the scheduling of a deposition, it would consider Brown's noncooperation as a voluntary withdrawal of her request for a hearing, and the case would be closed. Brown did not participate in a deposition. On November 27, 2007, an attorney for the Board sent Attorney Mitchell a letter stating, “As I have had no contact from you since September 25, 2007, the District now considers the request [for a hearing] to be withdrawn and the matter closed.” The Board did not schedule or give notice of a hearing. Consequently, on November 29, 2007, Brown filed an action in the circuit court against James for violation of the Employment and Dismissal Act.

PROCEDURAL HISTORY

Brown filed her initial complaint in circuit court because she believed her due process rights were violated under the Employment and Dismissal Act in that her contract was not renewed and she was never afforded an opportunity to be heard. Specifically, in her complaint against James, Brown alleged breach of contract, fraud, breach of contract accompanied by a fraudulent act, “negligence and/or negligent misrepresentation,” breach of duty of good faith and fair dealing, and intentional infliction of emotional distress. Brown asserts the Board made a final decision regarding her employment before she was afforded an opportunity to be heard as required by the Employment and Dismissal Act. Brown also asserts that she could not comply with the Employment and Dismissal Act's thirty-day appeal process regarding the Board's final determination as she did not have knowledge of the Board's final determination until eleven months after the decision was made.⁴ James did not file a formal answer that addressed any of the issues Brown raised in her complaint. Instead, on January 18, 2008, fifty days after the complaint was filed and served, James filed a motion to dismiss under Rule 12(b)(6), SCRCP, or in the alternative, a motion for summary judgment under Rule 56, SCRCP.

On February 13, 2008, Brown filed a motion to add the Board as a defendant. On March 7, 2008, James renewed his motion, stating only that Brown had not exhausted her administrative remedies. During February and March 2008, Brown filed a request for production of documents and requests to admit. During March and April, James answered the requests. After Brown received the responses to the request for production, she sought to amend her complaint to add the Board's attorneys as defendants predicated on their knowledge of and involvement in what she perceived to be a fraudulent act.

On April 28, 2008, the circuit court heard Brown's motion to amend and James' motion to dismiss. On May 5, 2008, the circuit court issued an order granting James' motion to dismiss,⁵ concluding that Brown had not exhausted her administrative remedies. The court also concluded that based on the dismissal, Brown's motion to amend was rendered moot. On May 12, 2008, Brown filed a motion for reconsideration, which included a request that if the dismissal was granted, that it be dismissed without prejudice. On June 20, 2008, the circuit court issued an order denying Brown's motion. This appeal followed.

ISSUE ON APPEAL

The issue presented in this case is whether the circuit court erred in granting James' motion for summary judgment because it concluded that Brown failed to exhaust her administrative remedies.

STANDARD OF REVIEW

When reviewing the grant of a summary judgment motion, an appellate court applies the same standard of review as the trial court under Rule 56, SCRCP. Wogan v. Kunze, 379 S.C. 581, 585, 666 S.E.2d 901, 903 (2008). The circuit court should grant summary judgment “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Rule 56(c), SCRCP; Russell v. Wachovia Bank, N .A., 353 S.C. 208, 217, 578 S.E.2d 329, 334 (2003); Knox v. Greenville Hosp. Sys., 362 S.C. 566, 569-70, 608 S.E.2d 459, 461 (Ct.App.2005); B & B Liquors, Inc. v. O'Neal, 361 S.C. 267, 270, 603 S.E.2d 629, 631 (Ct.App.2004).⁶

LAW/ANALYSIS

I. Exhaustion of Administrative Remedies

Brown argues the circuit court erred in concluding that her claims were not properly before the court due to her failure to exhaust her exclusive statutory remedy under the Employment and Dismissal Act. We agree.

The District Board of Trustees is considered an “agency” as defined in the Administrative Procedures Act (APA). See S.C.Code Ann. § 1-23-310(2) (2005 & Supp.2009) (“ ‘Agency’ means each state board, commission, department, or officer, other than the legislature, the courts, or the Administrative Law Court, authorized by law to determine contested cases.”). Under the APA, Brown was required to exhaust her administrative remedies before seeking judicial review. Section 1-23-380 of the South Carolina Code (2005 & Supp.2009) specifically states, “A party who has exhausted all administrative remedies available within the agency and who is aggrieved by a final decision in a contested case is entitled to judicial review pursuant to this article and Article 1.”

The general rule is that administrative remedies must be exhausted absent circumstances excusing application of the general rule. Hyde v. S.C. Dep't of Mental Health, 314 S.C. 207, 208, 442 S.E.2d 582, 583 (1994). However, one does not have to exhaust administrative remedies when it would be futile to do so. Ward v. State, 343 S.C. 14, 19, 538 S.E.2d 245, 247 (2000); Video Gaming Consultants, Inc. v. S.C. Dep't of Revenue, 342 S.C. 34, 39, 535 S .E.2d 642, 645 (2000). “Whether administrative remedies must be exhausted is a matter within the trial judge's sound discretion and his decision will not be disturbed on appeal absent an abuse.” Garris v. Governing Bd. of S.C. Reinsurance Facility, 319 S.C. 388, 390, 461 S.E.2d 819, 831 (1995); Hyde, 314 S.C. at 208, 442 S.E.2d at 582-83; Stanton v. Town of Pawley's Island, 309 S.C. 126, 128, 420 S.E.2d 502, 503 (1992). “An abuse of discretion arises where the trial judge was controlled by an error of law or where his order is based on factual conclusions that are without evidentiary support.” Tri-County Ice & Fuel Co. v. Palmetto Ice Co., 303 S.C. 237, 242, 399 S.E.2d 779, 782 (1990).

“The requirement of exhaustion of administrative remedies [in relation to] a court's authority to hear a case involving an agency, where a plaintiff has not asked the agency for relief, is often confused.” Adamson v. Richland County Sch. Dist. One, 332 S.C. 121, 125, 503 S.E.2d 752, 754 (Ct.App.1998). The doctrine of exhaustion of administrative remedies is generally considered a rule of “policy, convenience and discretion, rather than one of law, and is not jurisdictional.” Vaught v. Waites, 300 S.C. 201, 205, 387 S.E.2d 91, 93 (Ct.App.1989) (citing Andrews Bearing Corp. v. Brady, 261 S.C. 533, 536, 201 S.E.2d 241, 243 (1973)); see also Ex parte Allstate Ins. Co., 248 S.C. 550, 567, 151 S.E.2d 849, 855 (1966). While exhaustion is an “inflexible” rule in some jurisdictions, in South Carolina it “is discretionary in nature.” Andrews, 261 S.C. at 536, 201 S.E.2d at 243.

In this case, Brown received notice that her teaching contract was recommended for nonrenewal.⁷ In order to fully exhaust her administrative remedies, Brown was required to request a hearing before the Board within the time frame prescribed by the Employment and Dismissal Act. Section 59-25-420 of the South Carolina Code (2004) states, “Any teacher, receiving a notice that he will not be reemployed for the ensuing year, shall have the same notice and opportunity for a hearing provided in subsequent sections for teachers dismissed for cause during the school year.”

In order to secure her opportunity for a hearing, Brown was required to make a written request to the Board within fifteen days of the notice of nonrenewal pursuant to S.C.Code Ann. § 59-25-460 (2004). Here, there is no dispute that Brown timely requested a hearing after receiving the Board's April 12, 2007 notice. The analysis of this matter is convoluted for two primary reasons: 1) The Board officially voted to terminate Brown's contract on April 24, 2007 (unbeknownst to Brown) prior to affording her the opportunity for a hearing, all the while operating under the guise of proceeding to the administration of a fair and meaningful hearing, and 2) The Board dismissed her appeal on November 27, 2007, because she refused to submit to a deposition. We will address each of these issues in turn.

Finality of an Agency Action

The minutes of the April 24, 2007, Board meeting show a final decision regarding the termination of Brown's contract was made even before her fifteen-day period to request a hearing had expired.⁸ On appeal, James admits a final determination regarding Brown's contract was made on April 24, 2007, but argues that the Board accepted the recommendation “subject to the Act's procedural protections, particularly [Brown's] right to a Board hearing.” Yet, there is no language in the Employment and Dismissal Act that states a final decision of the Board is subject to a teacher's right to a hearing. Brown asserts that the April 24, 2007 vote by the Board constituted a final agency action. We agree.

Our Supreme Court has expounded upon the exhaustion of administrative remedies with regard to an agency's final decision. In S.C. Baptist Hosp. v. S.C. Dep't of Health & Envtl. Control, 291 S.C. 267, 270, 353 S.E.2d 277, 279 (1987), the Court held:

An agency decision which does not decide the merits of a contested case ․ is not a final agency decision subject to judicial review ․ It would be premature for a court to decide the merits of a dispute when the agency responsible for making the decision has not yet had an opportunity to decide the merits of the case.

In that case, the Court did not find judicial review of an interlocutory decision to be appropriate. Id. Conversely, judicial review would have been appropriate if an evidentiary hearing was conducted and a final decision regarding the merits of the case was made. Id.⁹ Additionally, in Canteen v. McLeod Reg'l Med. Ctr., 384 S.C. 617, 624, 682 S.E.2d 504, 507 (Ct.App.2009), the Appellate Panel of the Workers' Compensation Commission reversed the findings of the single commissioner regarding a brain injury and remanded the case for a determination of permanency to body parts other than the claimant's brain. The claimant immediately sought judicial review and the employer filed a motion to dismiss, arguing the Appellant Panel's decision was interlocutory because it had remanded the case for further proceedings. However, this Court held, “because the appellate panel ruled on [the only issue before it], there was a final agency decision on the merits in this case and [the claimant] exhausted all of her administrative remedies.” Id.

In the case at hand, whether or not to terminate Brown was the only issue to be determined regarding her contract, and when the Board unanimously voted to terminate Brown, it reached a final agency decision on the merits. Section 59-25-480 of the South Carolina Code (2004) specifically states, “The decision of the district board of trustees shall be final, unless within thirty days thereafter an appeal is made to the court of common pleas of any county in which the major portion of such district lies.”

Further, when the Board voted to accept James' recommendation for the nonrenewal of Brown's teaching contract prior to conducting a hearing, its decision had an immediate effect on Brown's legal rights. Section 59-25-460 and section 59-25-470 of the South Carolina Code (2004) make it expressly clear that before the Board makes a final decision regarding the acceptance or rejection of a recommendation for nonrenewal of a teacher's contract, the teacher must be afforded the opportunity to be heard. The observance of the procedural requirements of the Employment and Dismissal Act is mandatory and not a matter of discretion.

James concedes that Brown requested a hearing before the Board but argues that Brown did not pursue her request and as such, failed to exhaust her administrative remedies. He further states, “[A] board's decision concerning nonrenewal becomes final only after the teacher has had the opportunity to present testimony and evidence to the board in support of his [or] her case and the board acts to uphold or vacate its earlier nonrenewal decision.” Here, James inaccurately interprets the procedure outlined in section 59-25-470.

The Employment and Dismissal Act requires the Board to afford the adversely affected teacher a hearing based on the notice of dismissal that was recommended by the superintendent. After the hearing is completed, the Board is required to either affirm or withdraw the notice and that action will translate into its final decision. See S.C.Code Ann. § 59-25-470 (2004); see also Adamson, 332 S.C. at 128, 503 S.E.2d at 756 (explaining the Board is free to reject the superintendent's recommendation, and until then, there is no final board action). Further, contrary to James' argument, the Board never scheduled a hearing or sent Brown notice of the date, time, and place of a hearing as statutorily required, thus depriving Brown of the opportunity to be heard. The fact that an administrative hearing was not conducted below rests with the Board's failure to follow procedure as prescribed in the Employment and Dismissal Act, and not in any failure of Brown to exhaust her administrative remedies.

Exceptions to the Requirement of Exhaustion

Brown asserts that even if she failed to exhaust her administrative remedies before the Board, exhaustion was not required because the facts of her case satisfied one of the exceptions to the exhaustion requirement.

South Carolina, like most jurisdictions, recognizes exceptions to the exhaustion of administrative remedies requirement. The general rule is that administrative remedies must be exhausted absent circumstances supporting an exception to application of the general rule. Andrews, 261 S.C. at 536, 201 S.E.2d at 243; Allstate, 248 S.C. at 567, 151 S.E.2d at 855. The legislature will not require a futile act; therefore, a commonly recognized exception to the requirement of exhaustion of administrative remedies exists when a party demonstrates that pursuit of administrative remedies would be a vain or futile act. Moore v. Sumter County Council, 300 S.C. 270, 273, 387 S.E.2d 455, 458; Ward v. State, 343 S.C. at 19, 538 S.E.2d at 247; Video Gaming Consultants, 342 S.C. at 39, 535 S.E.2d at 645. “Futility, however, must be demonstrated by a showing comparable to the administrative agency taking ‘a hard and fast position that makes an adverse ruling a certainty.’ “ Law v. S.C. Dep't of Corr., 368 S.C. 424, 438, 629 S.E.2d 642, 650 (2006) (citing Thetford Properties IV Ltd. P'ship v. U.S. Dep't of Hous. & Urban Dev., 907 F.2d 445, 450 (4th Cir.1990)). Another exception to the exhaustion requirement is recognized when an agency has acted outside of its authority. See Responsible Econ. Dev. v. S.C. Dep't of Health & Envtl. Control, 371 S.C. 547, 553, 641 S.E.2d 425, 428 (2007).

Brown argues she was not required to request a hearing after a final determination had already been made regarding the nonrenewal of her teaching contract; rather, she asserts that she was within her legal right to appeal directly to the circuit court. Essentially, Brown argues a hearing conducted after the fact would be an action in futility. We agree.

Article 1, section 22, of the South Carolina State Constitution states:

No person shall be finally bound by a judicial or quasi-judicial decision of an administrative agency affecting private rights except on due notice and an opportunity to be heard ․ and he shall have in all such instances the right to judicial review.

Further, section 59-25-470 states that after the hearing has taken place and the Board has had the opportunity to determine “whether the evidence showed good and just cause for the notice of suspension or dismissal,” or in this case, nonrenewal of Brown's teaching contract, the Board “shall render its decision accordingly, either affirming or withdrawing the notice of suspension or dismissal.” In his brief, James cites this section of the code and admits “recommendations, when adverse to a teacher, are subject to the Act's procedural protections, particularly the right to a Board hearing pursuant to § 59-25-470.”

Plainly, the procedure is set in place to afford the teacher a meaningful review of the evidence prior to the Board making a final determination, as a review of the evidence after the fact would be futile. “The elementary and cardinal rule of statutory construction is that the Court ascertain and effectuate the actual intent of the legislature.” Horn v. Davis Elec. Constructors, Inc., 307 S.C. 559, 563, 416 S.E.2d 634, 636 (1992). Where, as here, the terms are clear and unambiguous, “the Court must apply them according to [their] literal meaning.” Anders v. S.C. Parole & Cmty. Corr. Bd., 279 S.C. 206, 209, 305 S.E.2d 229, 230 (1983).

Our research has not revealed any specific South Carolina case law addressing (or offering instruction on) whether a teacher must participate in a hearing after the Board has made a final determination regarding the nonrenewal of her contract. However, courts in other jurisdictions have analyzed issues similar to the case at bar. Specifically, the Indiana Court of Appeals has held:

[T]he notice by the school corporation to the tenure teachers was not sufficient, as it did not comply with the statutory requirements for the dismissal of a tenure teacher and such failure to comply with the statutory requirements did not require a tenure teacher to go forth with the burden of requesting a hearing for cause.

Joyce v. Hanover Cmty. School Corp., 276 N.E.2d 549, 564 (Ind.Ct.App.1971) (finding that the school board's action was arbitrary and capricious as it pertained to tenure teachers), overruled on other grounds by Myers v. Greater Clark County Sch. Corp., 464 N.E.2d 1323 (Ind.Ct.App.1984); see also Tippecanoe Valley School Corp. v. Leachman, 261 N.E.2d 880, 887 (Ind.Ct.App.1970) (holding that “evidence ․ was sufficient to sustain an implied finding by the trial court that the procedure provided by the contract for the removal of the plaintiff from his position as teacher was not followed and that failure to follow it was a gross abuse of discretion”).

The statutes interpreted in the Pennsylvania case of In re Swink, 200 A. 200 (1938), are very similar to South Carolina law in that they afford a teacher who has been notified that her contract has been recommended for nonrenewal an opportunity to present her case to the Board before a final decision has been made.¹⁰ In that case, the Pennsylvania Superior Court held the Board of School Directors failed to comply with the statutory requirements and reversed the Board's actions, stating that the observance of the prescribed procedure “is not a matter of discretion.” Id. at 203. The court further held, “[T]he purpose of the procedure prescribed by the act for the dismissal of a teacher ․ is to prevent arbitrary action by the board, to afford a fair hearing to the teacher ․ before dismissal, and to provide for full, impartial, and unbiased consideration by the board of the testimony produced.” Id. (emphasis added).

Similarly, the North Dakota Supreme Court has held that in order for a teacher to benefit from a hearing, she must be allowed to present her case at a hearing that is based on a contemplated recommendation for nonrenewal rather than the premature acceptance of the recommendation. Henley v. Fingal Pub. Sch. Dist. # 54, 219 N.W.2d 106, 110 (N.D.1974). Furthermore, the Supreme Court of Connecticut has explained:

Notice before termination and notice after termination are not two sides of the same coin. Once the board has committed itself by its action to a particular result it may be too late in the day to suggest a change of direction; at that stage the urge to proceed along its committed course is compelling. But before the die is cast it is still possible for persuasion to affect the result.

Petrovich v. New Canaan Bd. of Educ., 457 A.2d 315, 318 (Conn.1983).

Analogous to the cases cited above, in the present case, a hearing after the fact would have likely proven futile. Section 59-25-420 and section 59-25-430 of the South Carolina Code (2004) provide for a hearing prior to a final decision of the Board to avoid futility and allow for a meaningful and fair administrative hearing. In addition, because of the hostile environment that caused Brown to take Family Medical Leave in conjunction with the filing of her sexual harassment claim, it is likely the Board would have maintained its position of approving Brown's termination. Section 1-23-380 of the South Carolina Code (2005 & Supp.2009) states in part, “A party who has exhausted all administrative remedies available within the agency and who is aggrieved by a final decision in a contested case is entitled to judicial review pursuant to this article and Article 1.” It further states, “A preliminary, procedural, or intermediate agency action or ruling is immediately reviewable if review of the final agency decision would not provide an adequate remedy.” Id., see also Jean Hoefer Toal, et al., Appellate Practice in South Carolina 49 (2d ed.2002).

Brown did all that was required of her under the Employment and Dismissal Act; thus, she exhausted her administrative remedies. Consequently, as a matter of law, Brown was entitled to have her case proceed before the circuit court, and the granting of James' motion for summary judgment was improper.

Procedures for Compelling Participation in a Deposition

Brown argues the circuit court incorrectly concluded that because she did not participate in a deposition as requested by the Board, she essentially abandoned her right to a hearing and the Board was justified in dismissing her case. We agree.

James argues Brown was required to participate in a deposition prior to a hearing and uses section 59-25-490 of the South Carolina Code (2004) to support his position. Section 59-25-490, in pertinent part, states, “Any party to such proceedings may cause to be taken the depositions of witnesses ․“ (emphasis added).

However, the Employment and Dismissal Act does not authorize the Board to dismiss actions for lack of participation in a deposition. Instead, it outlines the procedure the Board should have taken. Specifically, the pertinent portion of section 59-25-490 states:

Such depositions shall be taken in accordance with and subject to the same provisions, conditions and restrictions as apply to the taking of like depositions in civil actions at law in the court of common pleas; and the same rules with respect to the giving of notice to the opposite party, the taking and transcribing of testimony, the transmission and certification thereof and matters of practice relating thereto shall apply.

(emphasis added).

Here, when the Board did not receive any responses from Brown or her attorney regarding her participation in the requested deposition, it should have served Brown with a subpoena in an effort to compel her attendance at a deposition pursuant to section 59-25-500 of the South Carolina Code (2004). Moreover, the Board could have moved before the circuit court to enforce such a subpoena under section 59-25-520.

The record does not indicate, nor was it asserted at oral argument, that the Board issued a subpoena or that one was served on Brown in an effort to compel her attendance at the requested deposition. Further, the record does not indicate that Brown was ever served with notice of the deposition or notice of a hearing before the Board. Section 59-25-520 of the Employment and Dismissal Act does not vest the Board with authority to dismiss Brown's request for a hearing based on her nonparticipation in a deposition; rather, it prescribes procedural mechanisms including seeking sanctions from the circuit court to compel participation in a deposition. However, the Board did not avail itself of this; instead, it presupposed to dismiss her case, which is not sanctioned under South Carolina law.

II. Dismissal of the Motion to Amend

Brown argues the circuit court abused its discretion when it dismissed her motion to amend her complaint to add parties on the grounds that her motion was moot in light of the fact that the court granted James' motion for summary judgment. We agree.

Rule 15(a), SCRCP, states in part, “[A] party may amend his pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires and does not prejudice any other party.” Rule 15(c), SCRCP, further states, “Whenever the claim or defense asserted in the amended pleading arose out of the conduct, transaction or occurrence set forth or attempted to be set forth in the original pleadings, the amendment relates back to the date of the original pleading.”

“It is well established that a motion to amend is addressed to the sound discretion of the trial judge, and that the party opposing the motion has the burden of establishing prejudice.” City of N. Myrtle Beach v. Lewis-Davis, 360 S.C. 225, 232, 599 S.E.2d 462, 465 (Ct.App.2004). “Courts have wide latitude in amending pleadings and ‘[w]hile this power should not be used indiscriminately or to prejudice or surprise another party, the decision to allow an amendment is within the sound discretion of the trial court and will rarely be disturbed on appeal.’ “ Berry v. McLeod, 328 S.C. 435, 450, 492 S.E.2d 794, 792 (Ct.App.1997). “The trial judge's finding will not be overturned without an abuse of discretion or unless manifest injustice has occurred.” Id.

Here, Brown attempted to add the Board's attorneys as defendants based on responses she received from discovery requests. Brown asserts the alleged improper conduct of the attorneys arose out of the same transaction or occurrence set forth in her original pleading. Because the circuit court erred in concluding that Brown had not exhausted her administrative remedies and in granting James' motion for summary judgment, Brown's motion to amend her complaint should have been considered in the proper light that she had in fact exhausted her administrative remedies. Accordingly, the circuit court erred in failing to consider the motion under this circumstance. We, however, do not address the merits of her motion to amend her complaint.

III. Automatic Renewal of Contract

Brown contends that because the Board did not recommend the nonrenewal of her contract before the April 15th deadline, her termination was illegal and her contract was automatically renewed. James argues the Board complied with the Employment and Dismissal Act's April 15th deadline as prescribed in section 59-25-410 of the South Carolina Code (2004) in that Brown received a letter on April 12, 2007, informing her of the intention to recommend nonrenewal of her contract.

Brown did not raise the issue of automatic renewal to the circuit court; thus, this issue is not preserved for our review. Staubes v. City of Folly Beach, 339 S.C. 406, 412, 592 S.E.2d 543, 546 (2000). Even if Brown had raised the issue below, if the circuit court did not rule on the issue and Brown did not file a motion to alter or amend the judgment, the issue is not properly preserved for appellate review. Aiken v. World Finance Corp. of S.C., 373 S.C. 144, 148, 644 S.E.2d 705, 708 (2007) (stating that in order to be preserved for appellate review, an issue must have been raised to and ruled upon by the trial court); I‘On, L.L.C. v. Town of Mt. Pleasant, 338 S.C. 406, 422, 526 S.E.2d 716, 724 (2000) (holding that if a party raises an issue in the lower court, but the court fails to rule upon it, the party must file a Rule 59(e) motion to alter or amend the judgment in order to preserve the issue for appellate review).

CONCLUSION

The wording of the South Carolina Teacher Employment and Dismissal Act is unambiguous regarding procedure, and the record fails to show the Board complied with its requirements. As a result, the circuit court erred in concluding Brown did not exhaust her administrative remedies. The circuit court also erred in misinterpreting the Employment and Dismissal Act, as Brown was not required to request a hearing of the school district's Board of Trustees after a final decision had been made regarding the nonrenewal of her contract; and, as a matter of law, Brown was entitled to appeal directly to the circuit court. Accordingly, the circuit court erred when it granted James' motion for summary judgment and when it concluded that Brown's motion to amend her complaint to add parties was moot.

Based on the foregoing, the circuit court's order is

REVERSED AND REMANDED.

FOOTNOTES

1.  S.C.Code Ann. § 59-25-410 to -530 (2004).

2.  The record does not explain what an improvement letter is, but it can be inferred that it is a letter outlining a plan to improve the teacher's performance. See S.C.Code Ann. § 59-25-440 (2004).

3.  Brown's initial pro se complaint and her sworn affidavit make reference to her EEOC complaint, which she filed based on sexual harassment, racial discrimination, and retaliation.

4.  The Board never sent Brown a formal notification of its final decision regarding her termination. She became aware of the date of the final decision through the Board's discovery responses to the case before the circuit court.

5.  James filed a motion to dismiss the complaint pursuant to Rule 12(b)(6), SCRCP, or, in the alternative, a motion for summary judgment pursuant to Rule 56, SCRCP. Under Rule 12(b)(6), SCRCP, a defendant may move to dismiss a complaint based on a failure to state facts sufficient to constitute a cause of action. Spence v. Spence, 368 S.C. 106, 116, 628 S.E.2d 869, 874 (2006). In considering such a motion, the trial court must base its ruling solely on allegations set forth in the complaint. Id. In the order granting the dismissal, the circuit court considered “the record in this case, the applicable law, and the argument of counsel and Brown.” In doing so, it effectively treated James' Rule 12(b)(6) motion to dismiss as a Rule 56 motion for summary judgment as it based its ruling on allegations and information set forth outside the complaint. Gilbert v. Miller, 356 S.C. 25, 27, 586 S.E.2d 861, 862-63 (Ct.App.2003); Baird v. Charleston County, 333 S.C. 519, 527, 511 S.E.2d 69, 73 (1999).

6.  The standard of review in determining whether the Board properly exercised its discretion under section 59-19-90 of the South Carolina Code (2004 & Supp.2009) is “whether the action measures up to any fair test of reason, and that a clear abuse of discretion is required to justify judicial interference.” Redmond v. Lexington County Sch. Dist. No. Four, 314 S.C. 431, 435-36, 445 S.E.2d 441, 444 (1994). This Court does not address the Board's discretion regarding its authority to terminate a teacher, only the process in which it carried out the decision.

7.  However, the notice did not inform Brown of the cause for the nonrenewal of her contract, as required by section 59-25-420 and section 59-25-460.

8.  The minutes of the April 24, 2007 Cherokee County School District No. 1, Board of Trustees, Board Meeting are replete with distinct categories that address personnel recommendations; however, the reference to the nonrenewal of Brown's contract is titled “Terminations.”

9.  In Darby v. Cisneros, 509 U.S. 137, 144 (1993), the United States Supreme Court held that “the finality requirement is concerned with whether the initial agency decision maker has arrived at a definitive position on the issue that inflicts an actual, concrete injury․” Additionally, in Idaho Watersheds Project v. Hahn, 307 F.3d 815, 825-28 (9th Cir.2002), the Ninth Circuit held that under certain circumstances, an agency's initial decision can be considered final for exhaustion purposes. Specifically, when an agency has completed the process for reaching an initial decision and when that decision has immediate legal effects on the petitioner, the initial decision will be considered a final decision, even though the initial decision-maker may reconsider its decision or the initial decision is subject to review within the agency.

10.  See 24 P.S. § 1121 (1937) and note, and §§ 1126, 1161, 1201, and 1202 (1937).

GEATHERS, J.

SHORT and WILLIAMS, JJ., concur.