Leandro school funding dispute returns to state Supreme Court in February

The North Carolina Supreme Court has scheduled oral arguments for Feb. 22 in the latest round of a nearly 30-year-old education funding lawsuit. It’s commonly known as Leandro.

The court voted 5-2 in October to take another look at the case, officially known as Hoke County Board of Education v. State. Justices will decide whether a trial court had “subject matter jurisdiction” to order hundreds of millions of dollars in new education spending.

The decision to take up the case again split the court along party lines. Republicans agreed to grant another review. Democrats dissented.

Three of the five Republican justices and the two Democrats even disagree about what to call the case. It’s known to most observers as “Leandro,” the name of the case’s original lead plaintiff in 1994. Yet Republican justices instead label the case “Hoke County.”

Republican justices refer to the state Supreme Court’s last major ruling in the case in November 2022 as “Hoke County III.” Democratic justices label the same ruling “Leandro IV.” In that decision, the court’s 4-3 Democratic majority called on a trial judge to update an earlier court order calling on the state to spend more money for education-related items.

Since that ruling, voters replaced two Democratic justices with Republicans. Republicans now hold a 5-2 state Supreme Court majority.

Legislative leaders asked the state’s highest court in September to take the case again, bypassing the state Court of Appeals. At issue in the legislators’ appeal is a trial judge’s decision in April ordering North Carolina to spend an additional $677 million. The money would cover items linked to a court-endorsed comprehensive remedial plan. The new Supreme Court order refers to the $677 million mandate as a “remedial order.”

Justice Anita Earls explained in a dissent why she and fellow Democratic Justice Allison Riggs would have rejected lawmakers’ request.

“Legislative-Intervenors’ bypass petition should be denied because it is substantively hollow and procedurally improper. This Court resolved the question of subject-matter jurisdiction in Leandro IV,” Earls wrote. “In that case — just 11 months old — the Legislative-Intervenors raised the same arguments they do in their bypass petition: That the trial court lacked jurisdiction to remedy constitutional deficiencies in public education. We examined that claim and ‘unequivocally rejected’ it.”

Earls rejected state lawmakers’ arguments that the case should focus only on Hoke County schools.

“Since the trial court found a statewide constitutional violation, we explained, it had subject-matter jurisdiction to order a statewide remedy,” she wrote. “But the Legisative-Intervenors ignored the trial court’s sound analysis and solid conclusion. They instead argued before us — as they do now in their petition — that ‘there has never been a finding’ of a constitutional violation ‘beyond Hoke County.’ We rebuffed that argument. And we went further, decrying it as ‘a fundamental misunderstanding of the history of this case and the State’s constitutional obligations.’”

“If parties can reopen a case by casting their disagreement in the language of ‘jurisdiction,’ then our courts will be nothing but revolving doors and our decisions nothing but paper tigers,” Earls wrote. “This case shows the danger of that approach.”

“We already grappled with and resolved the question of subject matter jurisdiction in this case — nothing imperils that decision or requires us to revisit it,” she added. “But by alchemizing its disagreement with Leandro IV into a ‘jurisdictional’ issue, the majority gives itself a tool to rewrite — and litigants to resist — our earlier decisions.”

A concurrence from Justice Phil Berger Jr., joined by fellow Republican Justices Richard Dietz and Trey Allen, answered Earls’ critique.

“The premise of the dissent is that this Court already ‘resolved the question of subject-matter jurisdiction in [Hoke County III].’ The dissent is wrong,” Berger wrote.

Berger noted Earls’ earlier work as a lawyer helping plaintiffs add the Charlotte-Mecklenburg Schools to the long-running case. The legal dispute had started with five different school systems.

“Core to their rationale for intervention was that every public school district faces its own unique educational challenges and groups of students or school districts in one area of our state are ill-suited to address the educational deficiencies in others,” he wrote.

“This raises questions that our Court has not yet addressed: If public school students or local school boards who are not parties to this case believe the remedial order does not sufficiently address the educational failure in their districts, are they bound by the remedial order?” Berger added. “If so, how were their rights adjudicated without their presence in the suit — an elementary principle of jurisdictional law.”

Berger wrote that Earls and the previous Supreme Court majority “rushed to complete its earlier opinion in this incredibly complex, novel case (one that has spanned decades) so that it could be released in November of last year. The failure to resolve these jurisdictional questions is not the first oversight from this Court’s rush to judgment in Hoke County III.”

“My dissenting colleague laments that subject matter is now being addressed because it will cause various harms to judicial integrity and ‘snuff out legal finality,’” Berger said of Earls. “Once again, we endure ad nauseum these fanciful protestations. But it is black letter law that courts cannot ignore potential defects in subject matter jurisdiction.”

“Even if we again failed to address jurisdictional concerns, these issues could be raised later in a collateral attack on the trial court’s order, causing tremendous chaos if steps are already being taken to execute the novel relief in the remedial order,” Berger warned.

“in its rush to publish an opinion in the prior matter, the majority declined to address fundamental subject matter jurisdiction questions,” Berger concluded. “To be sure, these issues were raised, but the majority chose to ignore the bedrock legal principle that courts must examine jurisdiction to act. Even legal neophytes understand that subject matter jurisdiction can never be waived and can be raised at any time.”

“Because these crucial issues of subject matter jurisdiction cannot be waived and must be addressed by this Court, it is a sound exercise of this Court’s constitutional role to take this case and permit the parties to brief the various issues.”

Both Berger and Earls face requests that they recuse themselves from the case’s next hearing.

Plaintiffs argue that Berger should step away from the case because his father, Senate Leader Phil Berger, R-Rockingham, helped request the latest state Supreme Court appeal. Meanwhile, legislative leaders argue that Earls should avoid the case because of her previous work representing parties in the case known today as “Penn-Intervenors.”

Neither Berger nor Earls has responded yet to the recusal requests. Court rules allow them to make a recusal decision themselves. They also can choose to turn the decision over to their colleagues for a vote.