Attorney said if appeal he can't use witnesses not called first time. Is it right?

Yes, that is correct in general. An appeal is based only on the record of the proceedings at the trial level. If there is evidence outside of th record and not presented (i.e. a witness who was not called to testify), then at the appellate level the attorney cannot use this non-testified witness to base his appeal. There is only one exception to this rule and that is if the attorney could not have with the excerise of due diligence discovered the evidence (ie. witness) prior to trial, then he MAY have a chance to argue that the a new trial should be conducted due to this failure. Even if this true, the appellate court will likely not allow a new trial because the appellate court will engage in a "harmless error/predudicial error" analysis. That is, if the error by the attorney (not using the witness) was an excusable error, the uncalled witness's testimony will have to have a substantial probability that the outcome would have been different if such witness was called to the stand. Thus, it is very difficult to win on the argument that the unpresented witness is the reason why the appeal should have been granted.

Not sure exactly what court you are in. My guess is that perhaps there was an administrative hearing with the school board? If this matter started out in court (e.g. superior court), there was a trial, and then there was an appeal, in the appellate court, your dad is right, as the new judges no longer look at facts, but just an application of the law to the facts. On the other hand, if this is an appeal from an administrative hearing, he may be incorrect. I don't want to speculate as I do not know all your facts, or what the rules of the union or school district process is.

I only answer questions based on Georgia Law. We do not have circuit courts in Georgia, so I am assuming you are not asking a Georgia question.