Iowa Supreme Court on Consolidation

The Iowa Supreme Court recently decided Northeast Community School District v. Easton Valley Community School District.

This case involved the question of whether, as a matter of law, a predecessor district could contractually bind a successor, reorganized district. In this case, the contract in question was a whole grade sharing agreement between Northeast and East Central, which subsequently reorganized with Preston to become the Easton Valley Community School District.

The district court entered summary judgment for Easton, finding as a matter of law that the whole grade sharing agreement with East Central did not bind Easton Valley. The Iowa Supreme Court found the district court erred by finding as a matter of law Easton was not bound by the whole grade sharing agreement, reversed, and remanded the case for further proceedings.

This case may not be of particular interest locally, but will matter to smaller districts as they plan for reorganization.