Breach of Contract Cases
8,244 employment law court rulings from public federal records (1880–2026)
About Breach of Contract Claims
Breach of employment contract claims arise when an employer violates the terms of a written or implied employment agreement. This may include violations of compensation terms, non-compete agreements, severance provisions, or implied promises of continued employment. These cases examine the existence and terms of the contract and whether a material breach occurred.
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Court Rulings (8,244)
Robert W. Cappellano vs. Massachusetts Bay Transportation Authority & others. No. 93-P-865. Suffolk. January 4, 1995. March 7, 1995. Present: Dreben, Gillerman, & Laurence, JJ. Labor, Fair representation by union, Discharge. On a claim against a union for alleged breach of duty of fair representation, the judge correctly ordered summary judgment for the defendant where the plaintiff did not demonstrate a reasonable expectation of proving that the union’s actions toward him were arbitrary, discriminatory, or in bad faith. [233-235] A plaintiff was barred under the terms of an applicable collective bargaining agreement from bringing an action against his employer for violation of the agreement, where he did not show that the union had failed in its duty to represent him fairly. [235-236] Civil action commenced in the Superior Court Department on January 11, 1989. The case was heard by Patrick J. King, J., on motions for summary judgment. Gerald T. Anglin for the plaintiff. John McMahon for Boston Carmen’s Union Division 589, Amalgamated Transit Union. John D. Cirame for Massachusetts Bay Transportation Authority. James O’Leary, John Leary, and members of the Boston Carmen’s Union Division 589, Amalgamated Transit Union. Dreben, J. In this action brought by the plaintiff against the union for breach of its duty of fair representation, and against the Massachusetts Bay Transportation Authority (MBTA) for wrongful termination of employment, a judge of the Superior Court allowed the defendants’ motions for summary judgment. On appeal, the plaintiff claims that the judge erred in allowing the motions because there were genuine issues of material fact as to whether the plaintiff was informed that he would be required to submit to a drug screen as a condition of reinstatement and whether he consented to the test. In affirming the judgment, we take a somewhat different view of the primary issue of the appeal. The plaintiff was hired as a part-time bus driver by the MBTA in 1985. During the 112 weeks that he was employed, he had missed more than sixty days of work and had received a number of suspensions for absenteeism. On August 19, 1987, he was suspended indefinitely, pending a recommendation for discharge. A grievance was filed by the plaintiff’s union representative, and the latter obtained a conditional reinstatement. The plaintiff would have to take a physical exam including a screening for alcohol, would have to maintain perfect attendance for the next two years, and would have to start as a new employee. Although the union claimed that one of the requirements was that the plaintiff would have to take a drug test, and that he consented to do so, the plaintiff maintains that he had no notice prior to arriving at the examination that it would include a screening for drugs. He claims, contrary to the judge’s conclusion, that he did not consent and that his lack of consent creates a genuine issue of material fact which precludes the allowance of the defendants’ motions. Whether the plaintiff consented prior to his coming to the examination is not, however, determinative of his claims against the union or against the MBTA. In his deposition, the plaintiff admitted that he was informed by the doctor, prior to his physical, that the exam would include testing for drugs. He then submitted to the exam, including the drug screening. When the test showed the presence of cannabis, the recommendation for discharge was reinstated, and the MBTA terminated the plaintiffs employment based on the excessive number of absences from the job. The union pursued the grievance through the MBTA’s director of human resources and its general manager, but declined to seek arbitration. The plaintiff was informed that he had the right to appeal that decision to the membership at a meeting. Although the plaintiff attended the meeting, he did not appeal. 1. Claim against the union for breach of duty of fair representation. Under § 22.8 of the constitution of the Amalgamated Transit Union, parties “must not take legal action or go into court until they have exhausted all their rights within the Union.” See Azzi v. Western Elec. Co., 19 Mass. App. Ct. 406, 408-409 (1985). The plaintiff, not having appealed and hence not having exhausted his union remedies, argues that he comes under an exception that permits “an employee [to] bring an action against his employer for a violation of a collective bargaining agreement if he alleges and shows that the union has failed in its duty to represent him fairly . . . ” id. at 409. A union is in breach of its duty of fair representation if its actions toward an employee are “arbitrary, discriminatory, or in bad faith.” Vaca v. Sipes, 386 U.S. 171, 190 (1967). The union may not “arbitrarily ignore a meritorious grievance or process it in perfunctory fashion.” Id. at 191. Graham v. Quincy Food Serv. Employees Assn. & Hosp., Library & Pub. Employees Union, 407 Mass. 601, 606 (1990). In order to find a breach “[t]here must be substantial evidence of bad faith that is intentional, severe, and unrelated to legitimate union objectives.” Id. at 609 (citations omitted). We conclude that the union “has shown by material described in Mass.R.Civ.P. 56(c), unmet by countervailing materials, that the plaintiff has no reasonable expectation of proving [this] essential element of [his] case.” Brunner v. Stone & Webster Engr. Corp., 413 Mass. 698, 705 (1992). See Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711 (1991). Although the plaintiff claimed hostility on the part of the union, there is nothing in the record to substantiate his claim. The only example of hostility cited by the plaintiff was that James Lydon, his union representative, “was getting a little bit disturbed that I was calling him on a regular basis and more or less told me so.” The plaintiff could muster no other acts of hostility. Nor did the union arbitrarily ignore a meritorious grievance which the plaintiff describes as “a presumptively unconstitutional drug test.” At the time of his discharge, the law relating to drug tests had not as yet evolved, and there was no presumption of unconstitutionality. Indeed, the practice of the union at that time, as set forth in its unrefuted answers to the plaintiff’s interrogatories, was that “in resolving grievances, the union and the grievants . . . accepted MBTA’s insistence on a drug/alcohol screen as a condition of return-to-work agreements.” The union’s belief that the claim was not worth pursuing was reasonable. The plaintiff’s attendance record was dismal, and he had received numerous suspensions. The conditions that the MBTA and the union, if not the plaintiff, had agreed upon had not been met — the plaintiff had failed the drug test. There is nothing in the record to suggest that the union was arbitrary in determining that pursuit of the grievance would not succeed and in deciding not to take the matter to arbitration. If a union’s failure to press a grievance was “the result of a reasonable and good-faith belief that [the] grievance [] [was] unmeritorious, the union was vested with the discretion not to pursue [it].” Graham v. Quincy Food Serv. Employees Assn. & Hosp., Library & Pub. Employees Union, 407 Mass. at 609. Even if the union, acting diligently and in good faith, misjudges the grievance, it has not committed a breach of the duty of fair representation as long as it has acted rationally. Early v. Eastern Transfer, 699 F.2d 552, 555 (1st Cir.), cert, denied, 464 U.S. 824 (1983). Walsh, A Judicial Guide to Labor and Employment Law 416-417 (1990). Thus, the plaintiff has shown no reasonable expectation of proving that the union failed in its duty of fair representation. This is so whether or not the plaintiff consented to a drug screening prior to appearing at the exam. 2. Action against MBTA. Since the plaintiff has failed in his claim that the union was in breach of its duty of fair representation, his action against the employer is barred. See Johnston v. School Comm. of Watertown, 404 Mass. 23, 25 (1989); Azzi v. Western Elec. Co., 19 Mass. App. Ct. at 408-409. Judgment affirmed. The plaintiff asserted other claims against each defendant, but on appeal he makes no argument with respect to these claims within the meaning of Mass.R.A.P. 16(a)(4), as amended, 367 Mass. 921 (1975). When asked whether he had any conversation with the doctor about the physical examination, the plaintiff answered as follows: A. “Yes. He told me it was going to require drug and alcohol screening.” Q. “Now, that’s before he took the sample; isn’t that correct?” A. “That’s before he took the sample.” Q. “Did you make any response?” A. “I objected. I told him I didn’t think it was required, but he told me it was a voluntary quit if I didn’t take the test.” Q. “Did you attempt to get back to Mr. Lydon [executive board member of the union]?” A. “No, I couldn’t because it was eight o’clock in the morning and I was anxious to go back to work.” Q. “Did you ask the doctor if the appointment could be rescheduled to a later time and date so that you could consult with your representative or with Mr. Lydon about the drug or alcohol screen?” A. “No, I didn’t.” Even the law as it has later developed does not appear to help the plaintiff. In Johnson v. Massachusetts Bay Transp. Authy., 418 Mass. 783, 786 (1994), the plaintiff bus driver who had been previously suspended was reinstated subject to a one-year probationary period during which any rule violation would result in his discharge. After a passenger reported that the driver of a particular route had alcohol on his breath, the plaintiff was instructed to appear the next morning for a physical examination which would include urine and blood tests. He orally gave permission to a physician for a drug and urine test. He claimed he agreed to the drug test only because of the coercion that he would have been terminated if he did not consent. Although, as in the present case, a written consent would have strengthened the MBTA’s position on the consent issue, the court held that “requiring testing as a condition of continued employment of a probationary employee would not be impermissible coercion in this case involving the operator of a public conveyance.” Ibid. The only distinction between this case and Johnson is that the condition here was imposed in order that the plaintiff not be fired and to enable him to become a probationary employee for two years, while the plaintiff in Johnson was already a probationary employee when the condition was required. The plaintiff argues that he is free to pursue his action against the MBTA only if the union has breached its duty of fair representation. Accordingly, we do not consider whether there is any other basis for a claim against the employer as urged by the union to defeat the claim against it.
LYTLE v MALADY Docket No. 157627. Submitted July 7, 1994, at Grand Rapids. Decided March 6, 1995, at 9:30 a.m. Leave to appeal sought. Nancy Lytle brought an action in the Muskegon Circuit Court against Michael Malady and Howmet Corporation after she was discharged from employment at Howmet, where Malady was her supervisor. Against Howmet, Lytle alleged unlawful age and gender discrimination under the Civil Rights Act and breach of an employment contract providing for termination for just cause only. Against Malady, Lytle alleged tortious interference with her contractual relationship with Howmet. The court, R. Max Daniels, J., granted summary disposition for Malady and Howmet. Lytle appealed. The Court of Appeals held: 1. Where, as here, an employee is discharged as a result of an economically motivated reduction in force by an employer, a prima facie case and rebuttable presumption of age discrimination under the disparate-treatment theory is established upon a showing that the employee was within the protected class, that the employee was qualified to assume another position with the employer at the time of discharge, and that age was a determining factor in the decision to discharge the employee. To rebut the presumption of disparate treatment, the employer must articulate some legitimate, nondiscriminatory reason for the discharge. Once the employer offers a nondiscriminatory reason, the employee must show that the employer’s proffered reason is a mere pretext and that discrimination was more likely the employer’s true motivation in discharging the employee. In this case, genuine issues of material fact remain with respect to whether Lytle has established a presumption of age discrimination and has shown that Howmet’s proffered reasons for her discharge were a mere pretext for discrimination. The trial court therefore erred in summarily dismissing the age discrimination claim. References Am Jur 2d, Wrongful Discharge §§ 1, 93, 102, 103, 120-122, 163, 164, 237. Modern status of rule that employer may discharge at-will employee for any reason. 12 ALR4th 544. Right to discharge allegedly "at-will” employee as affected by employer’s promulgation of employment policies as to discharge. 33 ALR4th 120. Liability of corporate director, officer, or employee for tortious interference with corporation’s contract with another. 72 ALR4th 492. 2. A prima facie case and rebuttable presumption of gender discrimination is established by a female in connection with the termination of her employment as part of an economically motivated reduction in force by the employer upon a showing by the employee that she was a member of a class entitled to protection under the Civil Rights Act, that she was qualified and applied for a position available at the employer, and that she was rejected under circumstances giving rise to an inference of illegal discrimination. The presumption may be rebutted by the employer if it articulates a legitimate, nondiscriminatory reason for the discharge. If the employer offers a nondiscriminatory reason, the employee must show that the proffered reason is a mere pretext for discrimination. In this case, there are genuine issues of material fact concerning whether Lytle has established a presumption of gender discrimination and has shown that Howmet’s proffered reasons for her discharge were a mere pretext for discrimination. The trial court therefore erred in summarily dismissing the gender discrimination claim. 3. Lytle’s allegations give rise to a genuine issue of material fact with regard to whether policy statements in Howmet’s employee handbook and oral assurances of job security created a legitimate expectation of just-cause employment. Bona fide economic reasons are just cause for discharge. However, an employer may not use economic necessity as a pretext for unlawful discrimination. Where, as in this case, the parties dispute the genuineness of the claimed economic necessity, the question of just cause is one for the trier of fact. The trial court erred in summarily dismissing the claim of breach of a just-cause employment contract. 4. Lytle’s allegations do not sufficiently establish that Malady tortiously interfered with her contractual relationship with Howmet in the absence of any claims that Malady acted outside the scope of his authority and that he acted for personal benefit rather than for the benefit of his employer. The trial court did not err in summarily dismissing the claim of tortious interference with a contractual relationship. Affirmed in part, reversed in part, and remanded. 1. Civil Rights — Employment Discrimination — Age — WorkForce Reductions. An employee discharged as part of an economically motivated reduction in force by the employer establishes a prima facie case and rebuttable presumption of unlawful age discrimination under the Civil Rights Act upon a showing that the employee was within the protected class, that the employee was qualified to assume another position with the employer at the time of discharge, and that age was a determining factor in the decision to discharge the employee; the employer can rebut the presumption by articulating some legitimate, nondiscriminatory reason for discharge; if the employer articulates a nondiscriminatory reason, the employee must then show that the proffered reason is a mere pretext for discrimination (MCL 37.2202[1][a]; MSA 3.548[202][1][a]). 2. Civil Rights — Employment Discrimination — Gender — WorkForce Reductions. An employee discharged as part of an economically motivated reduction in force by the employer establishes a prima facie case and rebuttable presumption of unlawful gender discrimination under the Civil Rights Act upon a showing that the employee was a member of a class entitled to protection under the act, that the employee was qualified and applied for a position available at the employer, and that the employee was rejected under circumstances giving rise to an inference of illegal discrimination; the employer can rebut the presumption by articulating some legitimate, nondiscriminatory reason for discharge; if the employer articulates a nondiscriminatory reason, the employee must then show that the proffered reason is a mere pretext for discrimination (MCL 37.2202[l][a]; MSA 3.548[202][l][a]). 3. Master and Servant — Employment Contracts. Employment contracts for an indefinite period are presumed to be terminable at the will of either party for any reason or for no reason; this presumption may be rebutted where the employee establishes the existence of an explicit or implied-in-fact promise of employment terminable for just cause only or presents evidence of employer policies or procedures creating a legitimate expectation of employment terminable for just cause only. 4. Master and Servant — Employment Contracts. An employer’s written policy statements that create legitimate expectations in employees of employment terminable for just cause only may be unilaterally modified by an employer upon reasonable notice of the change to affected employees. 5. Torts — Tortious Interference with Contracts — Employment Contracts. An employee claiming tortious interference by a supervisor with the employee’s contractual relationship with the employer must show that the supervisor acted beyond the scope of the supervisor’s authority and acted for personal benefit rather than in the interest of the employer. Bott & Spencer, P.C. (by Timothy J. Bott), for the plaintiff. Varnum, Riddering, Schmidt & Howlett (by Joseph J. Vogan), for the defendants. Before: Holbrook, Jr., P.J., and Murphy and J. C. Kingsley, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Holbrook, Jr., P.J. In this wrongful discharge case, plaintiff’s complaint alleged three counts against defendant Howmet Corporation: age discrimination under the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq., gender discrimination under the Civil Rights Act, and breach of a contract providing for termination for just cause only. The complaint also alleged tortious interference with contractual relations against defendant Michael Malady. Following some discovery, defendants moved separately for summary disposition, which was granted by the .trial court on all counts. Plaintiff appeals as of right, and we affirm in part, reverse in part, and remand. I In 1973, Howmet, a manufacturer of aircraft engine parts, hired plaintiff as a general clerk. Following a succession of positive performance appraisals and promotions, she was promoted in 1979 by her supervisor, John Ozar, to employment manager of the human resources department of Howmet’s Whitehall division. When defendant Malady became plaintiffs supervisor in 1987, a personality conflict arose, and in 1989, on Malady’s recommendation, she was demoted to human resources specialist. A younger, allegedly less qualified man was promoted to replace her. As a result of declines in military spending and a downturn in the commercial airline industry, Howmet instituted a series of reductions in its work force between 1988 and 1991. In August 1991, William Roof, director of the Whitehall human resources department, was directed to cut his 1992 department budget by fifteen percent (approximately $439,000). In November 1991, Roof eliminated four positions in the human resources department, including plaintiffs position as human resources specialist, and reassigned her job duties to other persons within the department. Roof decided to eliminate plaintiff’s position because her main responsibilities involved the hourly workers who bore the brunt of the downsizing. Plaintiffs "termination evaluation” indicated that Howmet would rehire plaintiff in the event a nonsupervisory, administrative position became open. II A motion for summary disposition under MCR 2.116(0(10) tests the factual sufficiency of a claim. In reviewing a grant of summary disposition, we must independently determine, giving the benefit of doubt to the nonmovant, whether the movant would have been entitled to judgment as a matter of law. Adkins v Thomas Solvent Co, 440 Mich 293, 302; 487 NW2d 715 (1992); Featherly v Teledyne Industries, Inc, 194 Mich App 352, 357; 486 NW2d 361 (1992). This Court reviews a summary disposition determination de novo as a question of law. Borman v State Farm Fire & Casualty Co, 198 Mich App 675, 678; 499 NW2d 419 (1993), aff'd 446 Mich 482; 521 NW2d 266 (1994). III Plaintiff asserts that the trial court erred in finding that no genuine issue of material fact existed with respect to plaintiff’s prima facie case of age discrimination and in granting Howmet summary disposition pursuant to MCR 2.116(C) (10). We agree and reverse. A Plaintiff’s claim of age discrimination is based upon the Civil Rights Act, which provides in pertinent part: (1) An employer shall not do any of the following: (a) Fail or refuse to hire or recruit, discharge, or otherwise discriminate against an individual with respect to employment, compensation, or a term, condition, or privilege of employment, because of ... age ... . [MCL 37.2202; MSA 3.548(202).] This Court has held that federal precedent, while not binding, is persuasive authority in interpreting and applying the Civil Rights Act. Featherly, supra at 357-358; Slayton v Michigan Host, Inc, 144 Mich App 535, 548, n 7; 376 NW2d 664 (1985). B An age discrimination claim can be based on two theories: (1) disparate treátment, which requires a showing of either a pattern of intentional discrimination against protected employees, e.g., employees aged forty to seventy years, or against an individual plaintiff; or (2) disparate impact, which requires a showing that an otherwise facially neutral employment policy has a discriminatory effect on members of a protected class. See Farmington Ed Ass’n v Farmington School Dist, 133 Mich App 566; 351 NW2d 242 (1984). In this case, plaintiff has presented competent evidence only of a disparate treatment claim. A plaintiff can establish a claim of disparate treatment with sufficient direct or indirect evidence of intentional discrimination. Direct evidence of disparate treatment would be evidence that, if believed, would prove the existence of the employer’s illegal motive without benefit of presumption or inference. Matras v Amoco Oil Co, 424 Mich 675, 683; 385 NW2d 586 (1986). That is not the usual case, however, because an employer is rarely so blatant as to announce its illegal motives. Instead, the usual case must be proven by indirect (circumstantial or statistical) evidence. In light of this reality, courts have created special rules of proof in order "to sharpen the inquiry into the elusive factual question of intentional discrimination.” Texas Dep’t of Community Affairs v Burdine, 450 US 248, 255, n 8; 101 S Ct 1089; 67 L Ed 2d 207 (1981). A prima facie case of age discrimination varies with differing factual situations. Matras, supra at 684. Where, as here, a plaintiff is discharged as a result of an employer’s economically motivated reduction in force (rif), a prima facie case of disparate treatment requires an initial showing, by a preponderance of the evidence, that (1) the plaintiff was within the protected class and was discharged or demoted, (2) the plaintiff was qualified to assume another position at the time of discharge or demotion, and (3) age was "a determining factor” in the employer’s decision to discharge or demote the plaintiff. Matras, supra; McDonnell Douglas Corp v Green, 411 US 792, 802; 93 S Ct 1817; 36 L Ed 2d 668 (1973). Because plaintiff has presented no direct evidence of age discrimination by Howmet, she must attempt to create through indirect evidence a rebuttable presumption of discrimination. In a rip case, it is insufficient for a plaintiff to show merely that the employer retained a younger employee while discharging an older employee. Matras, supra at 684; Featherly, supra at 359. Once established, a prima facie case creates a rebuttable presumption of disparate treatment. Burdine, supra at 252-253. At this point, the burden of production shifts to the defendant — as opposed to the burden of persuasion that never shifts —to rebut the presumption of disparate treatment by articulating (not proving) "some legitimate, nondiscriminatory reason” for the adverse employment decision against the plaintiff. Id. at 253-258. The defendant’s explanation must be clear and reasonably specific to afford the plaintiff "a full and fair opportunity” to demonstrate pretext. Id. at 256. If the defendant carries its burden of production, the presumption of discrimination is dispelled, and the factual inquiry proceeds to a new level of specificity. Id. at 255. See also St Mary’s Honor Center v Hicks, 506 US —; 113 S Ct 2742; 125 L Ed 2d 407, 422 (1993). The plaintiff’s burdens of production and persuasion merge, requiring her to prove by a preponderance of the evidence not only that the defendant’s proffered reasons are a mere pretext but also that illegal discrimination was more likely the defendant’s true motivation in discharging or demoting the plaintiff. Id., Fuentes v Perskie, 32 F3d 759, 764 (CA 3, 1994); Bodenheimer v PPG Industries, Inc, 5 F3d 955, 957 (CA 5, 1993). At this juncture, we note that there is a crucial distinction between a plaintiff’s prima facie case for purposes of surviving a summary disposition motion and a prima facie case sufficient to persuade a trier of fact at trial with regard to the ultimate question whether a defendant intentionally discriminated against the plaintiff. While the latter requires a plaintiff to prove her case to the trier of fact by a preponderance of the evidence, the former does not require her to go so far. Meeka v D & F Corp, 158 Mich App 688, 694; 405 NW2d 125 (1987); Fuentes, supra at 763-764. Neither a trial court nor this Court on appellate review of a summary disposition determination need conduct a minitrial to determine whether the plaintiff has met her burden of presenting a prima facie case by a preponderance of the evidence. Instead, for the plaintiff to survive a summary disposition motion, she need only tender specific factual evidence that could lead a reasonable jury to conclude that the defendant’s proffered reasons are a pretext for age discrimination. Bodenheimer, supra at 958; Hicks, supra, 125 L Ed 2d 416. Thus, the plaintiff must establish, either directly or indirectly, the existence of a genuine issue of material fact that the defendant’s proffered reasons are unworthy of credence, and that illegal age discrimination was more likely the defendant’s true motivation in discharging or demoting her. Id.; Featherly, supra at 362-363. Cf. Bouwman v Chrysler Corp, 114 Mich App 670, 678-679; 319 NW2d 621 (1982) (directed verdict). C Two issues are presented on appeal, both arising naturally from the McDonnell Douglas burden-shifting analysis: whether plaintiff created a genuine issue of material fact with regard to the existence of a prima facie case of discrimination by indirect evidence; and, if so, whether plaintiff created a genuine issue of material fact concerning whether Howmet’s proffered reasons were a mere pretext for age discrimination. 1 In this case, plaintiff’s prima facie case is based solely on circumstantial evidence. She alleges that in January 1989, defendant Malady demoted her from employment manager to human resources specialist, while simultaneously promoting Walter Boczkaja to employment manager. Boczkaja was younger, had less seniority with Howmet, less experience in the area of human resources, and had been trained by plaintiff during her tenure as employment manager. Plaintiff also alleges that, approximately six weeks before she was discharged in 1991 at age forty-four, Howmet hired Andrea Achterhoff, age thirty-one, as human resources specialist for its Operhall Research Center (orc), a division separate from the Whitehall division where plaintiff had worked. Plaintiff also alleges that, as part of an effort by Howmet to implement a new manufacturing approach, Jeff Billingsley, a training and development manager, was transferred from the corporate human resources department to Whitehall’s human resources department. Both Achterhoff and Billingsley were younger than plaintiff, had less seniority, and, according to plaintiff, performed duties that she could have assumed considering her nineteen years of experience at Howmet. We find plaintiff’s allegations, although meager, to be sufficient to create a genuine issue of material fact that age was a determining factor in her discharge. Because this is a rif case, Howmet’s decision to discharge qualified, older employees is not inherently suspicious but rather readily explainable in terms of its economic situation. Standing alone, the fact of such discharges does not warrant shifting the burden of production to How-met to justify its decision. Featherly, supra at 355. Here, however, we find that Howmet’s retaining and hiring of younger, less senior, and allegedly less qualified employees, while discharging plaintiff, "exude[s] that faint aroma of impropriety” sufficient to create a rebuttable presumption of disparate treatment. Thornbrough v Columbus & Greenville R Co, 760 F2d 633, 644 (CA 5, 1985). 2 In rebuttal, Howmet asserts that the elimination of plaintiff’s position as human resources specialist was justified because of a projected downturn in sales and a concomitant reduction in the hourly work force for which plaintiff was primarily responsible. Howmet further asserts that plaintiff was not replaced but that her duties were reassigned to various other employees. Howmet further claims that the hiring of Achterhoff for the position of human resources representative at orc was irrelevant to plaintiff’s discharge because orc is a separate division with a separate budget over which plaintiff’s supervisors had no control. In any event, Howmet asserts that Achterhoff was qualified for the
RODGERS v WASHTENAW COUNTY Docket No. 154972. Submitted December 6, 1994, at Lansing. Decided February 22, 1995, at 9:15 a.m. Kevin Rodgers filed an unfair labor practice charge with the Michigan Employment Relations Commission against his former employer, Washtenaw County, claiming that the December 1990 termination of his employment with the county was the result of unfair labor practices. The merc dismissed the charge on the basis that the filing of the charge in February 1992 was more than six months after the alleged constructive discharge and, thus, was not filed in a timely manner as required by § 16(a) of the public employment relations act, MCL 423.216(a); MSA 17.455(16)(a). Rodgers appealed, claiming that the limitation period of § 16(a) of the pera was tolled during the pendency of an action that he had filed in the Washtenaw Circuit Court against the county for breach of his contract of employment arising out of the same constructive discharge, said action having been filed in March 1991 and not having been dismissed until after the filing of the unfair labor practice charge. The Court of Appeals held: The general tolling provision of § 5856 of the Revised Judicature Act, MCL 600.5856; MSA 27A.5856, is not applicable to § 16(a) of the pera, because the provision in the pera specifically requires that an unfair labor practice charge be filed with the merc no more than six months after the unfair labor practice occurred. Just as the filing of an administrative proceeding does not toll the operation of a statute of limitation in a civil action, the filing of a civil action does not toll the operation of the statute of limitation applicable to a proceeding before the merc. Affirmed. Anthony A. Muraski, for the petitioner. Harris, Guenzel, Meier & Nichols, P.C. (by Robert E. Guenzel), for the respondent. Before: McDonald, P.J., and Fitzgerald and W. J. Giovan, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Per Curiam. Petitioner, Kevin Rodgers, appeals from the Michigan Employment Relation Commission’s dismissal of his unfair labor practice charge against respondent, Washtenaw County. The merc dismissed petitioner’s charge because it had not been filed within the six-month limitation period provided by MCL 423.216(a); MSA 17.455(16)(a). We affirm. Petitioner left his employment with respondent in December 1990. In March 1991, petitioner sued in the Washtenaw Circuit Court for breach of his employment contract. Petitioner’s action was dismissed by the circuit court on April 29, 1992, for lack of subject-matter jurisdiction. During the pendency of the circuit court action, petitioner filed his unfair labor practice charge with the merc on February 2, 1992, more than six months after his alleged constructive discharge. MCL 423.216(a); MSA 17.455(16)(a) provides in pertinent part: No complaint shall issue based upon any unfair labor practice occurring more than 6 months prior to the filing of the charge with the commission and service of a copy thereof upon the person against whom the charge was made .... (Emphasis added.) MCL 423.216(a); MSA 17.455(16)(a) provides one exception to this rule: where the aggrieved party "was prevented from filing the charge by reason of service in the armed forces, . . . the 6-month period shall be computed from the day of his discharge.” In addition to this statutory exception, this Court has found that the six-month period of limitation is tolled during the period when the employee has no knowledge of the unfair labor practice or while the employee pursues union grievance procedures. Huntington Woods v Wines, 122 Mich App 650; 332 NW2d 557 (1983); Silbert v Lakeview Ed Ass’n, Inc, 187 Mich App 21; 466 NW2d 333 (1991); Leider v Fitzgerald Ed Ass’n, 167 Mich App 210; 421 NW2d 635 (1988). MCL 600.5856; MSA 27A.5856 provides in relevant part: The statutes of limitations or repose are tolled: (a) At the time the complaint is filed and a copy of the summons and complaint are served on the defendant. (b) At the time jurisdiction over the defendant is otherwise acquired. Petitioner argues MCL 600.5856; MSA 27A.5856 acts to toll the six-month limitation period for filing his merc charge while his complaint was pending before the circuit court. We disagree. Exceptions to statutes of limitation are to be construed strictly. Mair v Consumers Power Co, 419 Mich 74; 348 NW2d 256 (1984). Additionally, a specific statute of limitations provision controls over a general provision. Michigan Millers Mutual Ins Co v West Detroit Building Co, Inc, 196 Mich App 367; 494 NW2d 1 (1992). The statute of limitations for a civil action brought in the circuit court is not tolled by a prior action seeking administrative relief for the same alleged harm. Mair, supra; Ray v Organization of School Administrators & Supervisors, Local 28, 141 Mich App 708; 367 NW2d 438 (1985). In Mair, supra, p 85, our Supreme Court cautioned against finding exceptions to statutes of limitation: The statutes of limitations, as well as the tolling statute, are of legislative creation. So too should be any further exceptions, and particularly any further exception which makes an administrative proceeding a tolling event. The vast number of administrative agencies and their varying procedures make this area one particularly appropriate for legislative action if any change is desired, and one particularly inappropriate for the ad hoc judgments of the judiciary. MCL 423.216(a); MSA 17.455(16)(a) specifically requires the filing of an unfair labor practice charge with the commission in order to stop the six-month limitation period from running. MCL 600.5856; MSA 27A.5856 is the general tolling provision applicable to statutes of limitation in civil actions and should not be applied to thwart the specific limitation provision of MCL 423.216(a); MSA 17.455(16)(a). Just as filing an administrative proceeding does not toll the operation of a statute of limitation in a civil action, we believe filing a civil action in the circuit court should not toll the operation of the statute of limitation applicable to a merc proceeding where the statute requires the filing of a charge with the merc. Affirmed.
HAROLD G. HAMILTON, PATRICIA PERRONE SANDERS, and all others similarly SITUATED v. MEMOREX TELEX CORPORATION No. 9310SC1081 (Filed 21 February 1995) 1. Limitations, Repose, and Laches § 113 (NCI4th)— pay for unused vacation days — change in policy — action not time barred Plaintiffs’ action was not barred by the statute of limitations where plaintiffs brought the action under the Wage and Hour Act to recover the value of vacation days they had not taken before they were terminated where defendant had changed its vacation policy on 21 December 1988 from earning vacation days one year for use in the next to advancing days on 1 January for use in that year and plaintiffs filed their action on 3 April 1991. Plaintiffs suffered no injury until the, defendant failed to pay them for vacation days they had allegedly earned in 1988; defendant’s policy did not require it to pay cash for any unused vacation days until the employment was terminated and no individual plaintiff had a cause of action until next pay day after termination. The trial court correctly found that only those plaintiffs whose pay date next following termination preceded 3 April 1989 (two years prior to the filing of this action) were barred by N.C.G.S. § 95-25.22. Am Jur 2d, Limitation of Actions §§ 107 et seq. 2. Labor and Employment § 56 (NCI4th)— unused vacation days — change in policy — termination of plaintiffs The trial court properly found that defendant’s refusal to pay plaintiffs for vacation days earned under defendant’s old policy prior to 1 January 1989 was a violation of the Wage and Hour Act where defendant changed its policy on 21 December 1988 from earning vacation days one year for use in the next to advancing days on 1 January for use in that year, subject only to working for the company for six months before using vacation days; defendant terminated plaintiffs after changing the policy; and defendant refused to pay plaintiffs for vacation days accrued under the old policy. Once the employee has earned wages and benefits under the Wage and Hour Act the employer may not rescind them, except that certain benefits including vacation pay may be made subject to forfeiture so long as the employer notifies the employee of the conditions of such a forfeiture prior to the time he or she earns such benefits. N.C.G.S. § 95-25.1 et seq. Am Jur 2d, Master and Servant § 80. 3. Labor and Employment § 56 (NCI4th)— unused vacation days — unilateral contract The trial court did not err in an action to recover payment for unused vacation time lost when defendant changed its vacation accrual policy and then terminated plaintiffs by finding, as an alternative basis for its judgment, that defendant had breached a unilateral contract with plaintiffs. Defendant’s old policy constituted a unilateral promise to grant an employee vacation in the next year if he worked in the previous one, which all of the plaintiffs accepted by working in 1988 and continuing to work through 1 January 1989. Am Jur 2d, Master and Servant § 80. 4. Labor and Employment § 56 (NCI4th)— unused vacation days — employees terminated after change The trial court erred by holding defendant liable for unused vacation time for employees terminated after 31 December 1989 (some plaintiffs were terminated before that time) where defendant changed its vacation policy from accumulating vacation days one year for use in the next to advancing vacation days on 1 January for use that year, with no carryover without permission, subject only to working for the company for six months, and with the change announced in a memorandum on 21 December 1988. Defendant’s policies concerning the carryover of vacation were valid and enforceable under the Wage and Hour Act; each policy was in place before the employees earned the vacation days thereby affected; none of the employees still employed after 31 December 1989 had any vacation days to carry over; and those employees suffered no loss when defendant paid them only for the days they had accrued in the year of their termination. Am Jur 2d, Master and Servant § 80. 5. Labor and Employment § 56 (NCI4th)— unused vacation days — determination of damages during liability phase of trial The trial court did not err in an action to recover the value of unused vacation days for which defendant refused to pay plaintiffs when they were terminated by making determinations of damages during the liability phase of the trial. Defendant offers no theory of how it was prejudiced by the court’s consideration of these matters during the liability phase; moreover, these matters all concern defendant’s liability to the class and do not involve defendant’s liability to any particular plaintiff. Am Jur 2d, Master and Servant § 80. 6. Labor and Employment § 56 (NCI4th)— unused vacation days — pay rates — date of termination The trial court did not err in an action to recover the value of unused vacation days by concluding that plaintiffs were entitled to recover payment for their unused days at their respective pay rates on the date of termination, rather than the rates at the earlier date when defendant’s policy on vacation accrual was changed. Plaintiffs’ injury was defendant’s failure to pay them for those days upon their termination and their action accrued on their respective dates of termination. Also, defendant’s policy explicitly provided that vacation days would be paid “at the current base rate.” Am Jur 2d, Master and Servant § 80. 7. Labor and Employment § 56 (NCI4th)— unused vacation days — six month employment limitation The trial court did not err in an action by terminated employees to recover the value of unused vacation days by awarding damages to employees who had begun their employment within six months of 1 January 1989 but who had been employed by defendant for at least six months prior to their termination, where defendant’s new vacation policy advancing leave for the year conditioned on six months employment took effect on 1 ■ January 1989. Although the court may have erred in drafting its finding of fact regarding the policy, the plain meaning of defendant’s policy is that an employee may not take vacation until he has worked for six months. Am Jur 2d, Master and Servant § 80. 8. Parties § 80 (NCI4th)— failure to pay for unused vacation days — class action — notice The trial court did not err by including in its judgment in a class action to recover the value of unused vacation days those class members whose notices were returned undelivered. Considering the number of plaintiffs involved and the availability of the plaintiffs’ addresses from the company file, in addition to the fact that it is the defendant who disputed the notice, the notice was in accord with applicable class action law, providing for the best notice practical under the circumstances and being reasonably certain to inform those involved, affording each member the chance to opt out of the class. The form of the notice was not substantially less likely to bring home notice than any other feasible alternative. Am Jur 2d, Parties §§ 50 et seq. 9. Labor and Employment § 56 (NCI4th)— failure to pay for unused vacation days — liquidated damages — interest The trial court did not err by awarding liquidated damages to plaintiffs in an action to recover the value of unused vacation days lost when defendant changed its vacation policy and subsequently terminated plaintiffs where defendant argued, that there was evidence to show that it changed the vacation policy solely for the purposes of accounting and that the change was an utterly proper, prospective alteration to its benefit scheme, so that it should not have to pay liquidated damages under N.C.G.S. § 95-25.22. However, the act that constituted the violation was the failure to pay plaintiffs for their vacation upon their termination, not the change in policy. Defendant pointed to no evidence to show that the failure to pay plaintiffs for their vacation days was done in good faith or in the belief that it was not a violation of the Wage and Hour Act and N.C.G.S. § 95-22 mandated that the trial court award liquidated damages. The trial court erred, however, in awarding interest on the liquidated damages. While N.C.G.S. § 95-25.22 states that interest may be recovered on unpaid wages, it does not provide that interest is payable on liquidated damages. Am Jur 2d, Master and Servant § 80. 10. Labor and Employment § 56 (NCI4th)— class action— unused vacation days — terminated employees — common law contract claim — attorney fees The trial court did not err in allowing attorneys’ fees for parties who recovered in a class action on common law contract claims but not on Wage and Hour Act claims for unused vacation days for which they were not paid on termination. The attorneys’ work was not divisible between Wage and Hour claims and contract claims; the two claims were based on the same fundamental legal theory and, because the claims were similar, time spent litigating the contract claim directly benefitted those whose Wage and Hour claims were not time-barred. Am Jur 2d, Master and Servant § 80. 11. Discovery and Depositions § 55 (NCI4tli)— class action— discovery — defendant ordered to produce information The trial court erred in a class action seeking compensation for vacation days lost when plaintiffs were terminated by compelling discovery when there was no outstanding discovery request. Plaintiffs had sent an interrogatory to defendant seeking information on all members of its class which was a continuing request, but plaintiffs did not contend that defendant failed to provide any information concerning members of the class as it was defined in the 18 November 1991 order certifying the class. Therefore, so long as the class continued to be defined as it was in the 18 November 1991 order, there were no unsatisfied discovery requests and the trial court erred by ordering defendant to produce information regarding people who were terminated. N.C.G.S. § 1A-1, Rule 37. Am Jur 2d, Depositions and Discovery §§ 361 et seq. 12. Labor and Employment § 56 (NCX4th)— unused vacation days — measure of damages The trial court erred in an action to recover the value of unused vacation days after defendant changed its vacation policy and terminated plaintiffs by failing to order defendant to pay employees terminated prior to 1 January 1990 the vacation leave pay promised under the old and new policies. By working in 1988, plaintiffs earned an allotment of vacation that could only be taken in 1989 and, under the new policy, plaintiffs earned vacation days that could be taken in that year. The two allotments were separate awards for separate periods of work, performed pursuant to two separate contracts. Am Jur 2d, Master and Servant § 80. Appeal by defendant from order entered 25 November 1991 by Judge Dexter Brooks, from order entered 18 December 1992 by Judge F. Gordon Battle, and from order and judgment entered 27 July 1993 by Judge Wiley Bowen, and appeal by plaintiffs from order entered on 18 December 1992 by Judge F. Gordon Battle, and from order and judgment entered 27 July 1993 by Judge Wiley Bowen in Wake County Superior Court. Heard in the Court of Appeals 26 May 1994. Plaintiffs instituted this class action on 3 April 1991, to recover vacation pay defendant had allegedly failed to pay each of them upon the termination of their employment with defendant. Judge Brooks certified the class in an order entered 18 November 1991. The class consisted of individuals who: (1) were employed by defendant before 21 December 1988; (2) were terminated after 31 December 1988; and (3) were not paid for vacation time they allegedly earned in 1988, prior to the implementation of a new vacation policy. Upon a joint motion of the parties, the case was bifurcated as to issues of liability and damages. Following a trial on 2 and 3 December 1992, Judge F. Gordon Battle entered an order finding defendant liable for compensatory and liquidated damages, interest and attorneys’ fees. Plaintiffs filed a motion for summary judgment on damages and a motion for entry of judgment on 8 July 1993. Following a hearing on the matter, Judge Bowen granted the motions and entered judgment against defendant for $753,006.32 in damages and interest and $50,550.08 for attorneys’ fees and expenses. On that same day the court entered an order to compel defendant to provide information concerning employees terminated after 31 July 1992. Defendant and plaintiffs appeal. Patterson, Harkavy & Lawrence, by Donnell Van Noppen, III, and Gulley and Calhoun, by Michael D. Calhoun, for plaintiff-appellees. Poyner & Spruill, L.L.P., by Cecil W. Harrison, Jr., and Robin T. Morris, for defendant-appellant. Thomas A. Harris and Attorney General Michael F. Easley, by Associate Attorney General John A. Greenlee, for Commissioner of Labor Harry E. Payne, Jr., amicus curiae. ARNOLD, Chief Judge. Defendant presents eleven arguments based upon thirty assignments of error and plaintiffs offer one argument based upon two assignments of error. Plaintiffs are all former employees of defendant who had been employed by defendant at any time prior to 21 December 1988 and were terminated after 31 December of that year. Prior to 21 December 1988, the defendant’s vacation.policy (the old policy), which had been adopted in 1986, provided as follows: If an employee was hired prior to 1 August of a given year, the employee was entitled to five days of paid vacation during that year. However these days could not be taken until the employee had completed three months of continuous employment. If an employee was hired on or after 1 August, the employee was entitled to no vacation days in that year, but would be entitled to take ten days of vacation the next year, after completing six months of continuous employment. If an employee was terminated after completing six months of service, he would be paid for any unused vacation that was earned and payable on 1 January of that year. On 21 December 1988, defendant notified all of its employees that, as of 1 January 1989, the vacation policy (the new policy) would be as follows: Vacation would be advanced on 1 January for use in that year. Vacation days were available for immediate use, but were “earned” over the course of the year. Upon termination, employees would be paid for the unused days they had earned up to that point in the year. Plaintiffs contend that under the old policy they earned vacation in each year for use in the next. Thus, they contend that by working in 1988 they had earned their vacation for 1989, which would have vested on 1 January 1989. The change in policy meant that in 1989 they were entitled to those days they had earned in 1988, in addition to whatever days they earned in 1989 under the new policy. Plaintiffs contend that the defendant failed to pay them for the days they had accrued under the old policy when they were terminated. On the other hand, defendants maintain that under the old policy the employees earned the vacation for each year merely by being in its employ on 31 December of one year and working on the first day in January of the next year. Under that interpretation, vacation was advanced at the beginning of each year, not earned in the previous one. The change in policy reflected only an accounting change, allowing the defendant to take the charges on its accounts over the course of the year, rather than on 1 January of each year. Defendant’s Appeal I. First, defendant argues that the trial court erred in failing to determine that the statute of limitations barred plaintiffs’ claim under the North Carolina Wage and Hour Act (the Act), N.C. Gen. Stat. §§ 95-25.1 to -25.25 (1989). We disagree. Plaintiffs brought this action, at least partly, under the Act to recover for vacation days they had not taken before they were terminated. The Act provides: No employer is required to provide vacation for employees. However, if an employer provides vacation for employees, the employer shall give all vacation time off or payment in lieu of time off in accordance with the company policy or practice. Employees shall be notified in accordance with G.S. 95-25.13 of any policy or practice which requires or results in loss or forfeiture of vacation time or pay. N.C.G.S. § 95-25.12. “Employees whose employment is discontinued for any reason shall be paid all wages due on or before the next regular payday. . . .” N.C.G.S. § 95-25.7. Vacation pay is included within the definition of “wage.” N.C.G.S. § 95-25.2. Claims for unpaid wages and benefits under the Act are subject to a two year statute of limitations. N.C.G.S. § 95-25.22(f). Defendant contends that the statute started to run on 21 December 1988 when it gave notice of the change in the vacation policy in accordance with section 95-25.12. As was recently made plain in Glover v. First Union National Bank, 109 N.C. App. 451, 428 S.E.2d 206 (1993), defendant’s argument is meritless. In that case the plaintiff sued the defendant to recover retirement benefits he was allegedly owed. The defendant argued that the statute of limitations barred his claim because any loss the plaintiff had suffered had occurred over twenty years previously when the retirement plan was amended. This Court rejected that argument, stating: “The statute begins to run on the date the promise is broken. In no event can the limitations period begin to run until the injured party is at liberty to sue.” Id. at 455, 428 S.E.2d 208 (citation omitted). In this case, the plaintiffs suffered no injury until the defendant failed to pay them for the vacation days they had allegedly earned in 1988. Defendant’s policy did not require it to pay cash for any unused vacation days until the employment was terminated. Therefore, no individual plaintiff had a cause of action until the next pay day after termination. The trial court correctly found that only those plaintiffs whose pay date next following termination preceded 3 April 1989 (two years prior to the filing of this action) were barred by section 95-25.22. We reject defendant’s first argument. Secondly, defendant argues that the Act displaces all other remedies in this situation so that its statute of limitations, which is shorter than those for plaintiffs’ common law actions, bars the entire action. Having found that the Act’s statute of limitations does not bar this, action, we need not address the defendant’s preemption argument. II. Defendant next argues that the trial court erred in concluding that it had breached any obligation to the plaintiffs, because the old policy unambiguously provided that employees did not earn vacation in one year for use in the next. We disagree. Defendant’s old vacation policy provided: First Year of Employment If you are hired prior to August 1, you are eligible for five (5) days of vacation during the current caléndar year after you have completed three (3) months of continuous service. You may take ten (10) days of vacation during the following calendar year. If you are hired on or after August 1, you are eligible for ten (10) days of vacation to be taken during the following calendar year after you have completed six (6) months of continuous service. In the event your employment is terminated . . . you will be paid for any untaken vacation that was earned and payable on January 1 of that calendar year. First, the trial court properly found that the defendant violated the Act by failing to pay plaintiffs for vacation days they had earned in 1988. Interpreted in its natural and ordinary meaning: [T]he Wage and Hour Act requires an employer to notify the employee in advance of the wages and benefits which he will earn and the conditions which must be met to earn them, and to pay those wages and benefits due when the employee has actually performed the work required to earn them. Narron v. Hardee’s Food Systems, Inc., 75 N.C. App. 579, 583, 331 S.E.2d 205, 208, disc. rev
DOLAN v CONTINENTAL AIRLINES Docket No. 149512. Submitted April 12, 1994, at Detroit. Decided January 17, 1995, at 9:15 a.m. Leave to appeal sought. Sue Ann Dolan brought an action in the Wayne Circuit Court against Continental Airlines, alleging violation of the Whistle-blowers’ Protection Act (wpa), MCL 15.361 et seq.; MSA 17.428(1) et seq., breach of contract, and a public policy tort claim as a result of the termination of the plaintiff’s employment with the defendant after she, without the employer’s permission, allegedly contacted the United States Drug Enforcement Administration with information regarding suspected drug traffickers and terrorists after her supervisor posted a notice requiring all employees first to receive permission to make such contacts. The court, William J. Giovan, J., granted the defendant’s motions to dismiss the claims. The plaintiff appealed. The Court of Appeals held: The circuit court’s grant of the defendant’s motions to dismiss the plaintiff’s claims is affirmed. Taylor, J., in an opinion with which R. D. Gotham, J., concurred in the result only, stated: 1. In order for the wpa to apply, the violation or suspected violation must be committed in the course of doing business. The wpa does not apply to this case because the failure to report or to be allowed to report suspected drug traffickers or terrorists is not itself a violation of the law and the defendant’s refusal to allow employees to report to the dea independently the information that the plaintiff sought to report did not constitute criminally irresponsible behavior on the part of the defendant. 2. The plaintiff’s public policy tort claim is not preempted by the wpa. However, the plaintiff did not state a valid public policy tort claim. 3. The trial court properly dismissed the breach of contract claim. The plaintiff was an at-will employee with no legitimate expectation of termination only for just cause. Shepherd, P.J., did not participate. Cunningham & Associates (by Douglas C. Cunningham), for the plaintiff. Miller, Canñeld, Paddock & Stone (by Leonard D. Givens and Megan P. Norris), for the defendant. Before: Shepherd, P.J., and Taylor and R. D. Gotham, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Taylor, J. Plaintiff appeals as of right a circuit court order granting defendant’s renewed motion to dismiss plaintiff’s first amended complaint. We affirm. Plaintiff worked for defendant as an agent in its Capitol City Airport hub. In early 1991, defendant informed plaintiff and her coemployees to be aware of persons purchasing tickets who fit certain "profiles” related to drug trafficking or terrorist activities. At the time, there were increased concerns about security measures because of the Persian Gulf Crisis. Relying on these profiles, on two separate occasions plaintiff reported persons to airport security, resulting in the arrest of these individuals. The United States Drug Enforcement Administration (dea) advised plaintiff that because of her tips she would receive a monetary reward. Because of concerns about overzealous reporting and the,unnecessary embarrassment of customers, plaintiff’s supervisor, Gordy Sullivan, posted a notice directing defendant’s employees not to call the dea without first clearing it with him. After the notice was posted, a dispute developed regarding whether plaintiff directly contacted the dea. She asserted that she did not, or, if she did, it was about the reward money and not in violation of Sullivan’s notice. Plaintiff’s employment with defendant was then terminated. Plaintiff filed her original complaint asserting violation of the Whistleblowers’ Protection Act (wpa), MCL 15.361 et seq.; MSA 17.428(1) et seq., and breach of contract. The circuit court granted defendant’s motion to dismiss the wpa claim, but granted plaintiff leave to amend her complaint in order to add a public policy tort claim. After plaintiff filed her amended complaint, defendant filed a renewed motion to dismiss both the breach of contract claim and the public policy tort claim. At that time, plaintiff also filed a motion requesting relief from the court’s earlier order dismissing her wpa claim. The court consolidated these matters, granted defendant’s motion to dismiss the breach of contract and public policy tort claims, and denied plaintiff’s motion for relief from the court’s original order that dismissed her wpa claim. Plaintiff argues that the trial court erred in dismissing her wpa claim because she has stated a prima facie case under the wpa. To state a prima facie claim under the wpa, a plaintiff must establish (1) that plaintiff was engaged in protected activities as defined by the act, (2) that plaintiff was subsequently discharged, and (3) that a causal connection existed between the protected activity and the discharge. [Tyrna v Adamo, Inc, 159 Mich App 592, 601; 407 NW2d 47 (1987).] Plaintiif asserts that, even after defendant’s notice, any telephone call to the dea to report profile information on customers constituted protected activity. The fundamental question raised in this case is whether the wpa was intended to protect employees who report customers meeting a profile of terrorists or drug traffickers. That is, third parties whose violations, if any, have no connection to the business. In Dudewicz v Norris Schmid, Inc, 443 Mich 68; 503 NW2d 645 (1993), the Supreme Court held that the wpa was intended to protect employees who report violations of law arising out of company business regardless of whether the criminal actor is an employer or employee. However, the Court noted that its holding did not begin to "test the outer limits of this rather broad statute.” Id. at 77. The case before us does test the outer limits of wpa coverage. In Dudewicz, the plaintiff filed assault and battery charges against a fellow employee. The employer told the plaintiff to drop the charges and the plaintiffs employment was terminated when he refused. In concluding that the wpa afforded the plaintiff protection, the Supreme Court explained that the Legislature intended the act to protect "employees who report violations of law by either their employers or fellow employees.” Id. at 75. With regard to whether the wpa extends coverage to employees who report violations by third parties, the Court suggestively stated that "a strictly literal interpretation of the statute without an analysis of legislative intent arguably could lead to an interpretation that would bar discharge of an employee for reporting a crime by anyone under any circumstances.” Id. at 77. Yet, because it was possible to do so, the Supreme Court resolved Dudewicz without addressing the outer limits of the wpa’s reach. In her dissent in Dudewicz, Justice Boyle indicated that she agreed with the majority that the purpose of the act is "both to encourage employees to assist in law enforcement and to protect those employees who engage in whistleblowing activities.” Id. at 83 (Boyle, J., dissenting). However, she continued by indicating that this observation [of the majority] fails to take account of a significant focus of the statute noted in the bill analyses. A whistleblowing employee alerts the public to the employer’s, or a co-worker’s, "corruption or criminally irresponsible behavior in the conduct of government or large business.” [Id] She summarized, saying: In other words, where the conduct of business itself violates a law, statute, or regulation, an employee’s report of that illegal conduct is protected activity. [Id.] In Justice Boyle’s view, when the employer in Dudewicz fired the plaintiff because he refused to drop the assault and battery charge against a coemployee, the plaintiff was not reporting illegal conduct on the part of the business, and thus, he should have had no wpa protection. I believe that the majority, had it gone that far in its analysis, would have agreed with Justice Boyle’s elaboration of the wpa’s focus if not her ultimate conclusion. My position is supported by the Dudewicz majority’s conclusion that states: "The wpa applies to an employee who reports a violation of a law arising out of a dispute over the handling of company business and occurring. during business hours.” Id. at 80. Had the Dudewicz majority utilized Justice Boyle’s approach, I believe it would have found that the defendant, by discharging the plaintiff for reporting criminal activity, was placing the business in the posture of being an accessory after the fact to the assaultive behavior of the assaulting employee. In doing so, the business was acting in a criminally irresponsible manner. Thus, in order for the wpa to apply, the violation or suspected violation must be committed in the course of doing business. In this case, plaintiff claims that she was discharged for reporting third parties who met a profile that would have placed those individuals in a pool of potential criminal actors. Plaintiff does not assert that her failure to make such a report, or to be allowed to make one, is itself a violation of law. Accordingly, defendant’s refusal to allow employees to report independently profile information did not constitute criminally irresponsible behavior on the part of the business, and thus, the wpa does not apply. Plaintiff also argues that the trial court erred in dismissing her public policy tort claim. A wpa claim and a public policy tort claim are mutually exclusive. Shuttleworth v Riverside Osteopathic Hosp, 191 Mich App 25; 477 NW2d 453 (1991). As the Court said in Dudewicz, supra at 80: A public policy claim is sustainable, .then, only where there also is not an applicable statutory prohibition against discharge in retaliation for the conduct at issue. As a result, because the wpa provides relief to Dudewicz for reporting his fellow employee’s illegal activity, his public policy claim is not sustainable. Given that the wpa affords no protection under the circumstances, plaintiff’s public policy tort claim is not preempted by the wpa. It does not necessarily follow, however, that plaintiff has a viable public policy tort claim. Plaintiff argues that defendant terminated her employment because it believed she telephoned the dea regarding persons meeting profiles of suspected drug traffickers and terrorists. Taking this factual allegation as true, Michigan Ins Repair Co, Inc v Manufacturers Natl Bank of Detroit, 194 Mich App 668, 673; 487 NW2d 517 (1992), plaintiff has failed to state a valid public policy tort claim. The Supreme Court, in Suchodolski v Michigan Consolidated Gas Co, 412 Mich 692, 695; 316 NW2d 710 (1982), has recognized three situations in which the grounds for discharge are so contrary to public policy as to be actionable even when the employment is at will. First, when the employee is discharged in violation of an explicit legislative statement prohibiting discharge of employees who act in accordance with a statutory right or duty. Second, when the employee is discharged for the failure or refusal to violate the law in the course of employment. Third, when the employee is discharged for exercising a right conferred by a well-established legislative enactment. Id. at 695-696. None of the above situations applies to the present case. Plaintiff does not cite any legislation explicitly prohibiting the termination of employees for reporting suspicious passengers to the dea. Plaintiff does not allege that she was discharged for failing or refusing to violate the law. Finally, plaintiff does not allege that she was discharged for exercising a statutorily conferred right. Therefore, plaintiff has no valid public policy tort claim. Finally, the trial court properly dismissed plaintiff’s breach of contract claim. Plaintiff argues that she was protected as a "just cause” employee because of statements in defendant’s human resources manual. The manual contained a progressive discipline system, but it also vested defendant with the unilateral option of an immediate termination. Accordingly, the manual could not create a legitimate expectation of termination only for just cause. Rood v General Dynamics Corp, 444 Mich 107, 140-142; 507 NW2d 591 (1993). This policy manual did not purport to be anything other than a disciplinary guideline and therefore the employer was able to treat plaintiff as an at-will employee and terminate her employment accordingly. Affirmed. R. D. Gotham, J., concurred in the result only. Shepherd, P.J., did not participate.
DRIVER v HANLEY Docket No. 149151. Submitted February 16, 1994, at Grand Rapids. Decided September 19, 1994, at 9:30 a.m. Maria E. Driver brought an action in the Benzie Circuit Court against William and Julia Hanley, alleging violation of the Whistleblowers’ Protection Act, retaliatory discharge, and breach of an employment contract relating to the termination of her employment after she filed a complaint with the Department of Labor that the defendants were paying her an hourly wage that was lower than the legal minimum. The court, James M. Batzer, J., removed the action to the 85th District Court after a mediation evaluation of $8,000 in the plaintiff’s favor. The district court, Brent V. Danielson, J., entered a judgment on a jury verdict for the plaintiff on all counts. The circuit court affirmed the judgment with respect to the claim under the Whistleblowers’ Protection Act, but reversed with respect to the claims of retaliatory discharge and breach of an employment contract, ruling those claims to be preempted by the Whistleblowers’ Protection Act. The defendants appealed by leave granted, and the plaintiff cross appealed. The Court of Appeals held: 1. The circuit court erred in removing the case to the district court. An action under the Whistleblowers’ Protection Act is within the exclusive jurisdiction of the circuit court. 2. The circuit court did not err in reversing the judgment with respect to the claims of retaliatory discharge and breach of an employment contract. The Whistleblowers’ Protection Act is the exclusive remedy for an employee whose employment is terminated in retaliation for reporting an employer’s violation of law. Affirmed in part and reversed in part. 1. Courts — Circuit Court — Whistleblowers’ Protection Act. The circuit court has exclusive jurisdiction over actions commenced pursuant to the Whistleblowers’ Protection Act (MCL 15.363[2]; MSA 17.428[3][2]). References Am Jur 2d, Wrongful Discharge §§ 55, 216, 220. Liability for discharging at-will employee for refusing to participate in, or for disclosing, unlawful or unethical acts of employer or coemployees. 9 ALR4th 329. 2. Master and Servant — Whistleblowers’ Protection Act — Exclusive Remedy. The Whistleblowers’ Protection Act provides the exclusive remedy for a discharged employee who claims that the discharge is in breach of the employment contract and in retaliation for the employee’s report of a suspected violation of law by the employer (MCL 15.361 et seq.; MSA 17.428[1] et seq.). Robert E. Hamel, for the plaintiff. Michael E. Hall, for the defendants. Before: Taylor, P.J., and Mackenzie and M. J. Matuzak, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Taylor, P.J. Defendants appeal by leave granted the circuit court’s order affirming in part and reversing in part the district court jury verdict in favor of plaintiff. Plaintiff cross appeals that portion of the circuit court order reversing the jury verdict in her favor. We affirm in part and reverse in part. In 1985, defendants moved from a private apartment within their foster care facility to a nearby house. In anticipation of their move, they hired plaintiff to work during the night shift. At the employment interview, Mrs. Hanley provided plaintiff with a job description and informed plaintiff of various workplace rules. According to plaintiff, Mrs. Hanley stated that she would be discharged only if she could not carry out her responsibilities or follow defendants’ work rules. Plaintiff’s shift began at 9:00 p.m. and ended at 6:30 a.m. Defendants paid plaintiff $20 a night ($2.11 an hour) and $3.35 an hour when plaintiff worked the day shift. Although defendants could initially afford to pay plaintiff only $20 a night, plaintiff testified that defendants promised her a raise once they moved into their new home. While Mrs. Hanley admitted she had an unwritten policy against discharging her employees without just cause, she testified that she did not guarantee plaintiffs employment at the foster home. Mrs. Hanley’s need for employees depended on the number of residents in her foster care home. Also, Mrs. Hanley did not recall promising plaintiff a raise. Shortly after her employment began, plaintiff became concerned about the procedure for dispensing medication to the residents of the foster care home. She reported her concern to Mrs. Hanley, but defendants made no change in their procedure. Thereafter, plaintiff reported her concern to the Mental Health Licensing Bureau. A representative from the bureau visited defendant’s facility and required defendants to change their procedure. When defendants moved out of the foster care home without giving plaintiff the raise she allegedly was promised, plaintiff filed a complaint with the Michigan Department of Labor, Wage and Hour Division, reporting that she was being paid $2.11 an hour, less than the minimum wage. After receiving the Department of Labor complaint, Mrs. Hanley telephoned plaintiff and told her that defendants no longer needed her services. When plaintiff asked Mrs. Hanley if she was being fired, Mrs. Hanley responded affirmatively and stated that she could not tolerate employees going to the authorities without first coming to her. Several hours later, Mrs. Hanley again telephoned plaintiff and offered her the opportunity to finish the work week, but plaintiff declined because Mrs. Hanley would not assure plaintiff a wage increase. Plaintiff filed her complaint in circuit court alleging violation of the Whistleblowers’ Protection Act (wpa), MCL 15.362; MSA 17.428(2), violation of the public policy against retaliatory discharge, and breach of her employment contract. After the parties received a mediation evaluation of $8,000, the circuit court removed the case to the district court because plaintiffs damages were likely to be below the $10,000 jurisdictional limit. The district court jury found in favor of plaintiff on each count and awarded $24,800 in damages. Defendants appealed to the circuit court, which reversed on the claims of retaliatory discharge and breach of an employment contract, finding that the wpa preempted them. The circuit court affirmed the district court’s judgment regarding the wpa claim, rejecting defendants’ argument that the judgment should be set aside for lack of subject-matter jurisdiction. Defendants argue on appeal that the circuit court erred in removing the case to the district court because the circuit court has exclusive jurisdiction over wpa actions. We agree. In removing plaintiffs claim to the district court, the circuit court relied on MCL 600.8301(1); MSA 27A.830K1) and MCR 4.003. According to MCL 600.8301(1); MSA 27A.8301(1): The district court shall have exclusive jurisdiction in civil actions when the amount in controversy does not exceed $10,000.00. Pursuant to MCR 4.003(A)(1), the circuit court may order an action removed to the district court if it appears that the damages may be less than $10,000, and if removal will expedite disposition of the matter. However, the wpa specifically provides for circuit court jurisdiction: An action commenced pursuant to subsection (1) may be brought in the circuit court for the county where the alleged violation occurred, the county where the complainant resides, or the county where the person against whom the civil compliant is filed resides or has his or her principal place of business. [MCL 15.363(2); MSA 17.428(3X2).] Because § 3 of the wpa and §8301(1) of the Revised Judicature Act each appear to provide jurisdiction to a different court, we must resolve the apparent jurisdictional conflict. Where a statutory jurisdictional conflict exists, the following rule applies: "Where there are two acts or provisions, one of which is special and particular, and certainly includes the matter in question, and the other general which, if standing alone, would include the same matter and thus conflict with the special act or provision, the special must be taken as intended to constitute an exception to the general act, as the Legislature is not to be presumed to have intended a conflict.” [Baxter v Gates Rubber Co, 171 Mich App 588, 590; 431 NW2d 81 (1988), quoting Wayne Co Prosecutor v Wayne Circuit Judge, 154 Mich App 216, 221; 397 NW2d 274 (1986).] We have previously determined that MCL 600.8301(1); MSA 27A.8301 is general in its application. Baxter, supra at 591. In contrast, § 3 of the wpa provides for circuit court jurisdiction over actions of a specific subject matter, namely, private actions for wrongful discharge or discrimination against an employee who has reported or is about to report a suspected violation of a law or regulation. MCL 15.363(2); MSA 17.428(3X2) and MCL 15.362; MSA 17.428(2). Accordingly, we hold that the specific jurisdictional grant of § 3 of the wpa takes precedence over the more general jurisdictional grant contained in § 8301 of the Revised Judicature Act. In other words, the wpa provides for exclusive circuit court jurisdiction, regardless of the amount in controversy. In her cross appeal, plaintiff claims the circuit court erred in reversing the jury verdict in her favor on the claim of breach of a just-cause employment contract. Although she acknowledges that the wpa provides the exclusive remedy for claims of retaliatory discharge, she asserts that a cause of action for breach of an employment contract is not precluded by the wpa. On the facts of this case, we disagree. It is well established that the wpa provides the exclusive remedy for an employee who has been discharged wrongfully from employment for reporting an employer’s violation of the law. Dudewicz v Norris Schmid, Inc, 443 Mich 68; 503 NW2d 645 (1993); Shuttleworth v Riverside Hosp, 191 Mich App 25; 477 NW2d 453 (1991); Branch v Azalea/Epps Home, Ltd, 189 Mich App 211; 472 NW2d 73 (1991). As a general rule, "when a statute creates a new right or imposes a new duty having no counterpart in the common law, the remedies provided in the statute for its violation are exclusive and not cumulative.” Shuttleworth, supra at 27. Because the wpa has no common-law counterpart, "the act is the exclusive remedy for an employee whose employment is terminated in retaliation for reporting an employer’s violation of the law.” Id. In the instant case, plaintiffs breach of an employment contract was based solely on the fact that she reported defendants’ violations of the law. Accordingly, we conclude that the wpa provided plaintiff with an exclusive remedy and preempted her cause of action for breach of an employment contract. Affirmed in part and reversed in part.
William F. King vs. Robert F. Driscoll & others. Middlesex. April 4, 1994. August 11, 1994. Present: Liacos, C.J., Abrams, Nolan, Lynch, & Greaney, JJ. Employment, Termination. Contract, Employment. Corporation, Stockholder’s derivative suit, Stockholder. Public Policy. Unlawful Interference. Malice. Practice, Civil, Attorney’s fees. Discussion of cases involving the issue whether a retaliatory discharge of an at-will employee violates public policy. [581-583] In a civil action in which an at-will employee claimed he was wrongfully terminated in retaliation for his participation as a shareholder in a derivative action against the employer, no considerations of public policy giving shareholders a right to seek redress for harms to a corporation, arising in the context of a conflict over the corporation’s internal affairs, rose to the level of importance required to justify an exception to the general rule regarding termination of at-will employees. [583-585] In a civil action in which an employee and shareholder of a closely held corporation claimed that the other shareholders breached the duty of utmost good faith and loyalty owed to him as a shareholder, the judge correctly concluded that the conduct of the defendants which caused the plaintiff to be terminated as an employee and, as a result, caused his stock to be repurchased constituted a breach of that duty. [585-587] In a civil action in which the plaintiff claimed that the defendants intentionally interfered with contractual relations, the evidence was insufficient to support a finding in favor of the plaintiff where no improper motive for the defendants’ conduct was shown. [587] The judge in a civil action correctly concluded that an officer of a corporation had been terminated without cause, under the corporation’s bylaws. [587-588] This court vacated an award of attorney’s fees to a plaintiff in a civil action that was based on rulings of the trial judge that this court reversed. [588] Civil action commenced in the Superior Court Department on June 28, 1990. The case was heard by Vieri Guy Volterra, J. The Supreme Judicial Court granted a request for direct appellate review. Richard L. Neumeier for the defendants. Morris M. Goldings {John F. Aylmer, Jr., with him) for the plaintiff. Stephen S. Ostrach, for New England Legal Foundation, amicus curiae, submitted a brief. Albert Marchant, Michael Martin, and F.S. Payne Co. Liacos, CJ. The defendants, Robert F. Driscoll, Albert Marchant, Michael Martin, and F.S. Payne Co., appeal from that portion of a judgment of the Superior Court entered against them in the plaintiff’s wrongful termination suit. The plaintiff filed a cross appeal from another part of that judgment. See p. 581 & note 5, infra. We granted the defendants’ application for direct appellate review. The primary issue presented here is whether the public policy exception to the rule that at-will employees may be terminated at any time with or without cause includes termination in retaliation for an employee’s participation in a shareholder derivative suit. We recount the facts, many of which are in dispute on appeal, as found by the trial judge sitting without a jury. See Mass. R. Civ. P. 52 (a), 365 Mass. 816 (1974). Payne is a closely held Massachusetts corporation which focuses on services to the elevator industry. Until 1988, it manufactured elevators and related parts. From its origin until August, 1990, all the stock of Payne was held by a small number of shareholders and Payne’s upper-level management positions were occupied by individuals owning relatively large amounts of the corporation’s stock. In August, 1990, Payne’s stock was purchased by Northern Elevator of Toronto. Beginning in 1954, employees of Payne who purchased Payne stock were required to enter into a “buy back” agreement which allowed Payne to repurchase the stock at the end of the employees’ respective tenures at Payne. The language of the buy back agreement was ambiguous and thus Payne repurchased stock over time from departing employees at varying rates. The buy back agreement became the subject of the shareholder derivative suit relevant here. See Dynan v. Fritz, 400 Mass 230 (1987), S.C., Martin v. F.S. Payne Co., 409 Mass. 753 (1991). The plaintiff here was one of the plaintiffs in that suit. During .the relevant time period, Edward A. Fritz, Jr., was a director, shareholder and, at one time, president of Payne. Driscoll was a director, shareholder, and the president of Payne when the incidents leading to this lawsuit took place. Martin was an assistant to Driscoll, a director of Payne, but not a shareholder. Marchant was a director, shareholder, and an employee of Payne. King began his employment with Payne in 1958 and received various promotions until 1982 when he was elected by the directors to be vice president of Payne’s manufacturing division. He remained in that position until his termination in November 1987. King was a shareholder of Payne. During the 1970’s and 1980’s, various power struggles transpired within Payne, mainly between Driscoll and Robert G. Dynan, another large shareholder and Payne’s lead salesperson. After Fritz’s retirement, the corporate infighting culminated with the ascension to the Payne presidency by Driscoll. Dynan had been a director but was not reelected in 1983. Around that time, Driscoll called for Dynan’s retirement, but Dynan refused. Later, Dynan’s business traveling was restricted by Driscoll and thus Dynan’s effectiveness as a salesperson was diminished. Both Dynan and Driscoll made overtures to King seeking his support in their “war.” At one point, Driscoll suggested to King that King should be transferred to another division within Payne so that King could be groomed to succeed Driscoll as president. King, preferring to remain in the manufacturing division, declined. In the spring of 1984, Dynan asked King to join him in filing a derivative suit regarding the stock buy back plan, especially as it related to the buy back of Fritz’s stock. King initially declined but later, concluding that the suit was in the best interests of Payne, joined as a party to the derivative action. During 1980-1984, Payne’s manufacturing division was profitable. During the pendency of the derivative action from 1985 through 1987, however, the division sustained increasing losses. The judge found that Driscoll’s course of conduct during that time exhibited a purpose to undermine King’s ability successfully to manage the manufacturing division and, thus, to make the division unprofitable. Among Driscoll’s actions cited by the judge were charging the salaries of certain employees to the overhead of that division, halting a computer project designed to improve manufacturing efficiency, and restricting Dynan’s business travel for sales purposes. In 1986, Driscoll hired Martin as his assistant, and Martin contracted with a consulting firm to evaluate the manufacturing division. The judge found that, for various reasons including Martin’s past relationship with members of the consulting firm, the firm’s evaluation of the division was compromised. Although Martin resigned his employment with Payne early in 1987, he had been appointed a director and so his involvement with the corporation continued. In March, 1987, Rick Auth was hired by Driscoll as assistant to the treasurer. Auth previously had been affiliated with the accounting firm that performed services for Payne. In June 1987, a “steering committee” was formed to investigate the performance of Payne’s manufacturing division. The committee was chaired by Auth. Its members were Marchant, King, two Payne managers, and Paul Oberg of the consulting firm. The majority of the committee ultimately suggested that new management was needed in the manufacturing division — that is, King should be terminated. On November 13, 1987, at a meeting of the Payne board of directors attended by Driscoll, Martin, Marchant and Fritz, the directors voted to terminate King. Fritz abstained from this vote. At a meeting on November 30, 1987, Driscoll, in the presence of Martin, terminated King’s employment. King contends that, at this meeting, Driscoll suggested that he would not be firing King if it were not for his participation in the derivative suit. The Driscoll faction proffered several legitimate business reasons for terminating King. The group contended that King was ineffective as vice president of manufacturing and cited King’s failure to prepare a five-year plan for manufacturing as requested by Driscoll, the $250,000 loss sustained by the manufacturing division in 1986, the steering committee’s recommendation, and the consulting firm’s recommendation. The judge discussed and rejected each of these reasons. In addition, the judge made findings regarding the motives and conduct of Driscoll, Martin, Marchant, and Fritz which led him to his conclusion that the reasons asserted for King’s termination were a pretext. The judge concluded that, on his review of the totality of the evidence, King’s termination did not have a legitimate business purpose. Instead, the judge found, King was terminated in retaliation for his participation in the derivative action. Acknowledging the general rule that, as an at-will employee, King could be terminated at any time with or without cause, the judge ruled that King’s termination in retaliation for participating in a derivative suit was covered by the public policy exception to the general rule. Thus, the judge concluded, King’s termination was wrongful and actionable at law. The judge also ruled that Payne, through the actions of Driscoll, Martin, and Marchant, breached the covenant of good faith and fair dealing implied in at-will employment contracts. As to King’s claim of intentional interference with contractual relations, the judge concluded that Driscoll and Martin, but not Marchant, were liable for interfering with King’s employment' contract with Payne. In addition, the judge concluded that Driscoll and Marchant, as shareholders in a close corporation, breached the duty of utmost good faith and loyalty owed to King, another shareholder. On King’s claim that his termination violated an implied contract that he would be terminated only “for cause” and only after notice and a hearing as provided in Payne’s bylaws, the judge ruled against King. Payne had filed counterclaims against King for allegedly violating an implied covenant of good faith and fair dealing by his alleged failure to prevent and later account for a loss of inventory, his alleged premature installation and invoicing of a particular elevator project, and his alleged failure to rectify a problem with a certain type of elevator button used by Payne. The judge found in favor of King on these counterclaims. The judge also awarded King attorney’s fees. 1. Wrongful termination claim. The defendants argue that there was insufficient evidence on which the judge could have based his finding of wrongful termination, and that, in any case, there is no public policy which would prevent an employer from terminating an employee who participates in a shareholder derivative action. Because we agree with the defendants’ second argument, we need not address the first. See Wright v. Shriners Hosp. for Crippled Chidren, 412 Mass. 469, 472 (1992) (whether retaliatory discharge violates public policy question of law for the judge). As an exception to the general rule that an employer may terminate an at-will employee at any time with or without cause, we have recognized that an at-will employee has a cause of action for wrongful termination only if the termination violates a clearly established public policy. Flesner v. Technical Communications Corp., 410 Mass. 805, 810-811 (1991) (wrongful termination where employee was terminated for cooperating with Customs officials in investigation of employer, even though employee was not required by law to cooperate) (noting, id. at 810, quoting Smith-Pfeffer v. Superintendant of the Walter E. Fernald State Sch., 404 Mass. 145, 149 [1989], that “redress is available for employees who are terminated ‘for asserting a legally guaranteed right [e.g. filing workers’ compensation claim]’ ”). Hobson v. McLean Hosp. Corp., 402 Mass. 413, 416-417 (1988) (wrongful termination may be found where employee was terminated for adhering strictly to what law required). DeRose v. Putnam Management Co., 398 Mass. 205, 209-211 (1986) (termination wrongful where employee was terminated for refusing to testify falsely at trial, i.e., refusing to do what the law forbids). Cort v. Bristol-Myers Co., 385 Mass. 300, 306-307 (1982) (wrongful termination may be found where employee is terminated for refusing to provide information to employer where such request is serious or substantial interference with privacy). Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 668 n.6 (1981), S.C., 391 Mass. 333 (1984). This court consistently has interpreted the public policy exception narrowly, reasoning that to do otherwise would “convert the general rule . . . into a rule that requires just cause to terminate an at-will employee.” Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., supra at 150. See Wright, supra at 474 (where nurse reported internal problems to high-level officials within organization, reports were internal matter, which could not be basis for pub-lie policy exception); Smith-Pfeffer, supra at 150-151 (where employee expressed disagreement with superior’s management of school, even if to do so was appropriate, socially desirable conduct, termination was not wrongful because school management was an internal matter); Mello v. Stop & Shop Cos., 402 Mass. 555, 560-561 (1988) (termination of employee who reported false damage claims could not be wrongful because claims were an internal matter). See also Mistishen v. Falcone Piano Co., 36 Mass. App. Ct. 243, 245-246 (1994) (discharge of employee who threatened to reveal employer’s unfair and deceptive trade practices which were not a threat to public health or safety was not wrongful because the situation did not rise to the requisite level of public importance; it was an internal matter); Yovino v. Fish, 27 Mass. App. Ct. 442, 444-445 (1989) (termination of producer of radio program who permitted program which parodied and thus offended public officials was not wrongful because no issue of freedom of speech of employee was involved). As the above cases demonstrate, the internal administration, policy, functioning, and other matters of an organization cannot be the basis for a public policy exception to the general rule that at-will employees are terminable at any time with or without cause. In this case, the subject of the lawsuit, the price to be paid under the stock buy back program, was an internal company matter. The mere fact that a dissatisfied shareholder could litigate the matter in a court of the Commonwealth does not transform this into an external matter involving, as the plaintiff argues, public policy. Thus, assuming that King was terminated in retaliation for participation in the derivative action, we conclude that his termination did not violate any public policy. General Laws c. 156B, § 46 (1992 ed.), conferred on King the right to participate in a derivative suit. While we often look to statutes to find pronouncements of public policy, see, e.g., Federici v. Mansfield Credit Union, 399 Mass. 592, 596-597 (1987); but see Wright, supra at 477-478 (Liacos, C.J., dissenting) (emphasizing separate common law sources of public policy determinations), it is not necessarily true that the existence of a statute relating to a particular matter is by itself a pronouncement of public policy that will protect, in every instance, an employee from termination. Even a public policy, evidenced in a particular statute, which protects employees in some instances might not protect employees in all instances. See Mistishen, supra. The statute at issue may suggest a public policy in favor of allowing shareholders to seek redress for perceived harms to the corporation. This public policy, however, which relates to the financial well being of the corporation and, by extension, its shareholders, does not rise to the level of importance required to justify an exception to the general rule regarding termination of employees at will. It may be true generally that the financial well being of a corporation affects the economy which in turn affects the well being of the citizenry, and that, therefore, shareholder derivative actions are appropriate and socially desirable conduct. Nevertheless, such a remote effect on the public, arising in the context of a conflict over internal policy matters, does not elevate King’s participation in the lawsuit to protected activity. See Mistishen, supra at 246. The fact that participation in a derivative suit is a right of a shareholder employee conferred by G. L. c. 156B, § 46, also does not change our conclusion. To date, we have acknowledged very few statutory rights the exercise of which would warrant invocation of the public policy exception. See Flesner, supra at 810. For the exercise of a statutory right to be worthy of protection in this area we believe that the statutory right must relate to or arise from the employee’s status as an employee, not as a shareholder. Cf. Mello, supra at 557 (rule of liability can be found where statute expresses Legislature’s policy concerning employees’ rights). The exerelse of the right to file a derivative action arose from King’s status as a shareholder; his termination as an employee resulting from the exercise of that right does not automatically entitle him to seek redress. 2. Breach of the duty of utmost good faith and loyalty owed to King as a shareholder. Relying on Donahue v. Rodd Electrotype Co. of New England, Inc., 367 Mass. 578, 586-587 (1975), and Wilkes v. Springside Nursing Home, Inc., 370 Mass. 842, 848 (1976), the judge concluded that Driscoll and Marchant breached the duty of utmost good faith and loyalty to King when they terminated King’s employment with Payne. The defendants argue for reversal of this conclusion. In support thereof they offer the case of Evangelista v. Holland, 27 Mass. App. Ct. 244 (1989). Evangelista, supra at 248-249, cites to Donahue, supra at 598 n.24, for the proposition, “Questions of good faith and loyalty do not arise when all the stockholders in advance enter into an agreement for the purchase of stock of a withdrawing or deceased stockholder.” In both the Donahue and Evangelista cases, however, the controversies themselves arose from repurchase transactions of the stock of certain shareholders. Donahue, supra at 579. Evangelista, supra at 245-246. Thus, the courts deciding those cases were examining the duties of good faith and loyalty surrounding the repurchase transactions alone. Accordingly in Evangelista, where there was a valid repurchase agreement previously executed and there was no indication that, at the time of the execution of the agreement, the parties failed in their duties of good faith and loyalty, the court was warranted in stating that “ [questions of good faith and loyalty do not arise when all the stockholders in advance enter into an agreement for the purchase of stock . . . .” Id. at 248-249. Evangelista does not stand for the proposition that the existence of a buy back agreement completely relieves shareholders of the high duty owed to one another in all dealings among them. In this case, contrary to the facts of Donahue and Evangelista, the allegations of breach of the duty of utmost good faith and loyalty arose from the conduct of fellow shareholders Driscoll and Marchant during the whole series of events leading up to and including the termination of the plaintiff. The plaintiff did not aver that the terms of the repurchase constituted a breach of the duty, but in essence argued that the conduct of the defendants w
MEERMAN v MURCO, INC Docket No. 146860. Submitted December 15, 1993, at Grand Rapids. Decided June 7, 1994, at 10:00 a.m. Leave to appeal sought. Debra Meerman brought an action in the Kalamazoo Circuit Court against Murco, Inc., seeking damages for repudiation by the defendant of an employment contract after the plaintiff had terminated her prior employment in order to accept the defendant’s offer of employment. The court, Richard R. Lamb, J., granted summary disposition for the defendant, holding that the plaintiff was an at-will employee and that she had failed to show that she could be discharged only for just cause. The plaintiff appealed, arguing that her claim was based not only on wrongful discharge, but also on promissory estoppel and, accordingly, that the court erred in holding that summary disposition was appropriate because she was an at-will employee. The Court of Appeals held: Although the trial court erred in treating the plaintiff’s action as one for wrongful discharge, it reached the right result, because this case is factually indistinguishable from Barnell v Taubman Co, Inc, 203 Mich App 110 (1993), in which it was held that a claim based on promissory estoppel is not established by the giving up of one’s prior employment, and Administrative Order No. 1994-4 compels the same result in this case. Affirmed. Chambers, Steiner, Mazur, Ornstein & Amlin, P.C. (by Martin R. Sturm), for the plaintiff. Miller, Canñeld, Paddock & Stone (by Kevin M. McCarthy), for the defendant. Before: Neff, P.J., and Weaver and K. B. Glaser, JJ._ Circuit judge, sitting on the Court of Appeals by assignment. Per Curiam. Plaintiff, Debra Meerman, appeals as of right from an order of the trial court granting summary disposition to defendant, Murco, Inc. Plaintiff claims that the trial court erred in holding that her cause of action in this case was contingent upon her establishing that a just-cause employment relationship existed. We affirm, but for reasons other than those expressed by the trial court. i One day in May 1990, defendant’s president, Paul Murray, Sr., asked plaintiff, while she was at work at the Aries Cafe, if she was interested in working at defendant. At that time, plaintiff, who was employed full-time as a traffic manager at Biggs-Gilmore and part-time at the Aries Cafe, told Murray that she was not interested in seeking other employment. On a later date, Murray returned to the Aries Cafe with Richard Vesta, a vice president at defendant, and the two of them discussed with plaintiff the possibility of her employment by defendant and indicated that, if she came to work at defendant, she would be working for Vesta. Once again, plaintiff declined and told them that she was not interested in seeking new employment because she was happy at her current position. Vesta later contacted plaintiff and asked her at least to come out and speak with him and Murray. Plaintiff thereafter interviewed with both Murray and Vesta at defendant’s plant. During the interview, which was held in late May or early June 1990, plaintiff was offered the position of administrative assistant to Vesta at a salary of $23,000 a year plus benefits, which was much more than she was making at Biggs-Gilmore. Plaintiff did not accept the position at that time, however. On June 25, 1990, plaintiff spoke with Vesta on the telephone and orally accepted the offer of employment. Plaintiff later met briefly with Vesta and informed him that she might be moving out of state within the next six months. Vesta replied that plaintiff was worth taking that risk. On June 29, 1990, plaintiff resigned her position at Biggs-Gilmore so that she could begin employment with defendant on July 23, 1990. On July 23, 1990, plaintiff arrived for work at defendant and learned that Vesta’s employment with defendant had been terminated. On that same day, Murray met with plaintiff and offered her a position as his secretary, which plaintiff accepted. On July 24, 1990, plaintiff returned for work and was informed that the position as Murray’s secretary was no longer available. Plaintiff subsequently contacted her former employer, Biggs-Gilmore, but was told that her former position was no longer available. Plaintiff brought suit against defendant, alleging that she was entitled to recovery under theories of wrongful discharge and promissory estoppel. In count i of her complaint, plaintiff alleged that defendant’s refusal to provide the promised position of employment constituted a breach of the employment contract. In count n, she alleged that she had relied to her detriment on defendant’s promise of employment and, as a result, suffered loss of employment, wages, and other benefits associated with employment. Defendant thereafter moved for summary disposition, arguing that plaintiff was an at-will employee and, therefore, could not maintain a cause of action against defendant for breach of contract. Defendant further argued that plaintiffs promissory estoppel claim must also fail because no promise was made to plaintiff regarding the duration of her employment or that it would be anything other than at will. The trial court determined that because plaintiff was an at-will employee, summary disposition should be granted pursuant to MCR 2.116(0(10) with regard to both counts of her complaint. n Plaintiff claims that the trial court erred in holding that her cause of action was contingent upon her establishing that she was a just-cause employee. She claims that she did not plead a Toussaint-type (Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 [1980]) wrongful discharge claim, but rather a breach of contract claim under the principles of promissory estoppel and detrimental reliance. In support of her argument, plaintiff relies on Hackett v Foodmaker, Inc, 69 Mich App 591; 245 NW2d 140 (1976), and Filcek v Norris-Schmid, Inc, 156 Mich App 80; 401 NW2d 318 (1986). In Hackett, the plaintiff obtained an early release from the Navy and moved his family, at considerable expense to himself, to undertake employment with the defendant. However, the position promised to the plaintiff was given to someone else after the defendant learned of the plaintiff’s participation in an antitrust suit against it. In Filcek, the plaintiff had permanent employment with a car dealership when the defendant offered him employment. The day following the plaintiff’s resignation from his job at the dealership, the plaintiff was notified that the position offered him by the defendant was no longer available. The plaintiff in Filcek was unable to regain his job at the car dealership. In both Hackett and Filcek, this Court found "distinguishing features” that removed those cases from the general rule of at-will employment. Filcek, supra, p 85; Hackett, supra, pp 594-595. Both the Hackett and the Filcek panels of this Court relied upon the defendants’ repudiation, coupled with the plaintiffs’ actions in reliance on the contracts, to conclude that the plaintiffs had a cause of action. See Filcek, supra, pp 84-85. III Defendant argues that there can be no liability even under a promissory estoppel theory because plaintiff’s employment would have been terminable at will at any time. In support of its position, defendant relies upon Cunningham v 4-D Tool Co, 182 Mich App 99; 451 NW2d 514 (1989), and Marrero v McDonnell Douglas Capital Corp, 200 Mich App 438; 505 NW2d 275 (1993). In Cunningham, the plaintiff responded to a newspaper advertisement placed by the defendant that indicated its need for a tool and die worker in Mesick, Michigan. After the defendant offered him the job, the plaintiff gave up his job, made improvements to a lot he owned in Mesick, and made arrangements to move his mobile home. However, when the plaintiff appeared at the defendant’s plant, he was advised that the job offered was not available. The Cunningham panel of this Court disagreed with the Filcek panel’s conclusion that an employer’s repudiation of a contract before the date set for the plaintiff’s performance is a distinguishing feature. Cunningham, supra, pp 104-105. The Cunningham panel also found the plaintiff’s relinquishment of his employment and the moving of his home and family to be customary and necessary incidents of changing jobs rather than a distinguishing feature. Id., pp 105-106. The Cunningham panel noted that the defendant did not bargain for the plaintiff to resign from his prior employment and to move his family to Mesick. The Cunningham panel also focused on the fact that the defendant did not seek out the plaintiff specifically and induce him to take the job. Id., p 106. In Marrero, supra, p 443, this Court relied upon the Cunningham case in stating: [Resignation from one position to assume another and relocation of family would be customary and necessary incidents of changing jobs rather than consideration to support a promissory estoppel claim. IV In Barnell v Taubman Co, Inc, 203 Mich App 110; 512 NW2d 13 (1993), the plaintiff was a long-term employee of Rapistan and, in January 1984, he became its vice president of finance. In the spring of 1985, an employment search company contacted the plaintiff and advised him that the defendant was seeking to fill a new position of vice president of financial services. At the time, the plaintiff was not looking to change positions, but he eventually agreed to work for the defendant. He moved from Grand Rapids to the Detroit area. After working for the defendant for about IV2 years, the plaintiff was terminated from his employment without prior notice. The plaintiff brought suit against the defendant under several theories, including a promissory estoppel claim. With regard to the promissory estoppel claim, this Court in Barnell, supra, p 122, stated: We agree with plaintiff that the trial court incorrectly ruled that promissory estoppel is "just another way of rephrasing Toussaint,” because promissory estoppel is a claim that is separate from a claim of wrongful discharge. However, this Court affirmed the trial court’s grant of summary disposition with regard to the plaintiffs claim of promissory estoppel, despite the fact that the defendant specifically sought the plaintiff and induced him to leave his position at Rapistan, stating, id.: The elements of promissory estoppel are: (1) a promise, (2) that the promisor should reasonably have expected to induce action of a definite and substantial character on the part of the promisee, (3) which in fact produced reliance or forbearance of that nature, and (4) in circumstances such that the promise must be enforced if injustice is to be avoided. [Schipani v Ford Motor Co, 102 Mich App 606, 612-613; 302 NW2d 307 (1981).] In this case, plaintiff left his position at Rapistan and moved from Grand Rapids to the Detroit area. This is insufficient to establish reliance. [Marrero, supra, p 443] (resignation of one’s position to assume another and relocation of one’s family are customary and necessary incidents of changing jobs rather than consideration to support a claim of promissory estoppel). We find Barnell to be factually indistinguishable from the present case and, therefore, are compelled by Administrative Order No. 1994-4 to reach the same result. We therefore affirm the trial court’s grant of summary disposition in this case. Were we not bound by the administrative order, we would find that Vesta’s and Murray’s actions in specifically seeking out plaintiff and inducing her to leave her previous employer were "distinguishing features” that would remove this case from the general rule regarding at-will employment, and we would reverse the grant of summary disposition with regard to plaintiff’s promissory estoppel claim. Affirmed.
KOCENDA v ARCHDIOCESE OF DETROIT Docket No. 150075. Submitted March 1, 1994, at Detroit. Decided April 19, 1994, at 9:40 a.m. Leave to appeal sought. Diane Kocenda and Rosemary Szymofelnik brought an action in the Wayne Circuit Court against the Archdiocese of Detroit and others, alleging wrongful discharge, promissory estoppel, and other claims following their dismissal from employment at St. Francis Cabrini High School. The plaintiffs had been discharged before the expiration of the last of a series of employment contracts that had each provided for eleven months of employment. On the defendants’ motion, the court, Edward M. Thomas, J., limited the damages the plaintiffs could recover to the salaries they would have earned had they been employed until the end of their contracts. The defendants tendered those amounts to the plaintiffs and moved for the dismissal of the plaintiffs’ claims. The court granted the motion. The plaintiffs appealed. The Court of Appeals held: The trial court did not err in ruling that the plaintiffs were not entitled to damages for the loss of future income and that they were not entitled to renewal of their contracts. The plaintiffs’ employment clearly had been terminable at the will of the employer or the employee and had not provided for employment that was terminable for just cause only, given that the employment contracts did not provide for tenure, specified that employment was terminable by either party upon thirty days’ notice, and that terminated employees were entitled to thirty days’ pay following notice of termination. Affirmed. Master and Servant — Employment Contracts — Breach — Damages. For breach of an employment contract providing for employment of a definite duration, a wrongfully discharged employee is generally entitled to damages consisting of the agreed-upon compensation for the unexpired term of employment, less what the employee could earn by making diligent efforts to obtain similar employment. References Am Jur 2d, Damages §§ 109, 111. See ALR Index under Damages; Labor and Employment. Dib & Fagan, P.C. (by Barry S. Fagan and Keitha Cowen), for the plaintiffs. Bodman, Longley & Dahling (by James J. Walsh and Karen L. Piper), for the defendants. Before: Reilly, P.J., and Griffin and C. L. Bosman, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Per Curiam. Plaintiffs appeal as of right from a circuit court order limiting damages for their wrongful discharge claims against defendants. Defendants cross appeal the denial of their motion for summary disposition of the claims. We affirm. Plaintiff Rosemary Szymofelnik, a member of the Sisters of the Holy Family of Nazareth until 1989, was employed by defendant St. Francis Cabrini High School in 1972 under a contract with the parish for her services. In 1980, Szymofelnik was given the position of principal. Throughout her engagement at the school, Szymofelnik was employed under a series of eleven-month contracts. Szymofelnik was discharged by defendant Father Gary Bueche, pastor of defendant St. Francis Cabrini Parish and, allegedly, an agent of the defendant Archdiocese of Detroit, on March 7, 1989, before the end of the term of her then current contract. In 1982, plaintiff Diane Kocenda was employed as a guidance counselor at St. Francis Cabrini High School for an eleven-month term under a written contract. Kocenda and St. Francis Cabrini entered into successive eleven-month contracts until the last employment contract of July 1988. Kocenda was also discharged from employment on March 7, 1989, by Father Bueche. Plaintiffs filed a circuit court action on May 19, 1989, alleging wrongful discharge and promissory estoppel with respect to Kocenda (count i); breach of third-party beneficiary contract with respect to Szymofelnik (count ii); wrongful discharge and promissory estoppel with respect to Szymofelnik (count hi); defamation of Szymofelnik by Father Bueche (count iv); invasion of privacy (false light) against defendant Carl Weiss (count v); invasion of privacy (false light), against Father Bueche (count vi); violation of the Employee Right to Know Act, MCL 423.501 et seq.; MSA 17.62(1) et seq. (count vn); and tortious interference with a contractual and business relationship against Weiss (count vm). Defendants filed a motion for summary disposition pursuant to MCR 2.116(C)(10), arguing that plaintiffs’ claims were barred by the First Amendment, that plaintiffs were at-will employees under the terms of their contracts, and that the remaining claims failed as a matter of law. The trial court granted the motion with respect to counts vn and viii, but denied it with respect to the other counts. On May 15, 1991, defendants filed a motion to limit the damages plaintiffs could recover on the claims of wrongful discharge and promissory estop-pel under the eleven-month employment contracts. The motion was granted. At the hearing on plaintiffs’ motion for clarification/rehearing, the trial court explained that it granted defendants’ motion because future damages could not be determined with a reasonable degree of certainty, the contract was for a definite period of time and was not automatically renewable, and it was "clear that it was an at-will situation.” Plaintiffs’ motion for a rehearing was denied. An order was entered limiting the plaintiffs’ damages under counts i and m to their respective salaries through June 30, 1989, the end of their term of employment under the employment contracts. Subsequently, the trial court indicated that the same reasoning applied to count ii. On November 8, 1991, without admitting liability, defendants tendered to plaintiffs the maximum allowable damages as ruled by the trial court. On December 20, 1991, defendants filed a motion to dismiss plaintiffs’ claims of wrongful discharge, promissory estoppel, and breach of contract, arguing that there was no longer any litigable controversy concerning those claims because plaintiffs could not accomplish more if they went to trial. On January 10, 1992, the trial court heard arguments and granted defendants’ motion by praecipe order. On February 24, 1992, the trial court entered a stipulation and order whereby the parties agreed to dismiss counts iv, v, and vi with prejudice and without costs, to dismiss Carl Weiss as a defendant, and to waive mediation sanctions. The parties further agreed to the following: In light of the Court’s decision to grant Summary Disposition as to Counts i, n and m of Plaintiffs’ Amended Complaint, Plaintiffs are permitted to accept the salaries due each Plaintiff, through the end of the term of their contracts without in any way waiving their right to appeal any and all of the underlying orders and the Order Granting Summary Disposition as to Remaining Counts which shall be deemed final as of the date [of] entry of this order. Also on that date, in a formal order, the trial court dismissed counts I, n, and hi and, given that the remaining counts were dismissed by stipulation or order, ruled that the entire case was dismissed and that all previously entered orders were deemed to be final. Plaintiffs argue two theories to support their claim that the trial court erred in refusing to allow consequential damages with respect to their contract claims. First, plaintiffs claim that their inability to obtain employment and the resulting loss of future income was a direct and foreseeable consequence of the wrongful termination of their contracts midyear. Second, plaintiffs claim that the trial court improperly revisited the issues whether the contracts provided for termination only for "just cause” and whether plaintiffs were entitled to automatic renewal of their contracts absent just cause. Having reviewed the record, we are convinced that the trial court did not err. Both of the plaintiffs’ contracts contained the following language, except that the word "teacher” was inserted in Kocenda’s contract in place of the word "principal.” 1. Unless terminated as hereinafter provided, this agreement and principal’s employment with school shall terminate without further obligation on the part either of principal or of school at the end of the school year, a[n] 11 month period commencing August 1, 1988 and ending June 30, 1989. Principal understands, acknowledges and agrees, that he/she has no right to have this agreement extended or renewed by school or to have school offer employment to him/her for any other school year that school is under no obligation whatsoever to extend or to renew this agreement or to offer employment to him/her for any other school year, and that school may elect not to extend or renew this agreement or not to offer employment to him/her for any other school year. school understands, acknowledges and agrees that principal is under no obligation and may elect not to extend or renew this agreement or not to accept employment, if offered by school, for any other school year. 6. This agreement may be terminated during the school year either by principal or by school upon thirty (30) days written notice subject to the following: if school terminates this agreement without notice or with notice of less than thirty (30) days, principal shall be paid for the thirty (30) days immediately following notice of termination, as if he/she had actually worked the full thirty (30) days following notice, even if relieved of duties before thirty (30) days after notice of termination; if principal terminates this agreement with less than thirty (30) days written notice, principal shall receive compensation for days actually worked but shall forfeit any accrued but unpaid fringe benefits; if principal gives thirty (30) days written notice of termination, principal shall receive compensation for days actually worked plus any accrued fringe benefits. 7. This agreement may be terminated during the school year by school immediately, without notice, at any time in the event of any violation of any term of this agreement by principal, or if school otherwise determines that principal’s services no longer are necessary or satisfactory, and principal shall be entitled only to such compensation as was earned but unpaid up to and including principal’s last day of work .... Paragraph 10 of the Supplement to Teacher Contract signed by both plaintiffs provided: 10. The School is under the obligation to retain the teacher only for the time stated in the Contract. The School has no duty or obligation to automatically renew a Teacher’s contract for another year. It is also agreed and understood that there is no "Tenure” in the Cabrini School System. We agree with the trial court that plaintiffs were not entitled to future damages or to renewal of their contracts. The normal rule is that a wrongfully discharged employee is entitled to the total amount of the agreed-upon salary for the unexpired term of his employment, less what the employee could earn by making diligent efforts to obtain similar employment. Isagholian v Carnegie Institute of Detroit, Inc, 51 Mich App 220; 214 NW2d 864 (1974); 5 Corbin, Contracts, § 1095, p 514; 11 Williston on Contracts (3d ed), § 1358, p 302. Beyond this, the employee is not permitted recovery for injury to his reputation. The primary reasons underlying the rule are that (1) the computation of damages for injury to reputation is unduly speculative, and (2) such damage cannot reasonably be presumed to have been within the contemplation of the parties when they entered into the contract. Lindsey v Univ of Arizona, 157 Ariz App 48; 754 P2d 1152 (1987). See also Myrtle Springs Reverted Independent School Dist v Hogan, 705 SW2d 707 (Tex Civ App, 1985), cert den 480 US 906 (1987); Daley v Town of West Brook-held, 19 Mass App 1019; 476 NE2d 980 (1985); Winship v Brewer School Committee, 390 A2d 1089 (Me, 1978); Billmyre v Sacred Heart Hosp of the Sisters of Charity, Inc, 273 Md 638; 331 A2d 313 (1975). In view of the specific language that there was no tenure, that the contracts were terminable by either party upon thirty days’ notice, and that plaintiffs were entitled to thirty days of pay following notice of termination, plaintiffs could not reasonably expect that they would be entitled to compensation for any future wage loss even if they were terminated without just cause. Unlike Munro v Elk Rapids Schools (On Rehearing), 385 Mich 618; 189 NW2d 224 (1971), and Anderson v West- wood Community School Dist, 49 Mich App 406; 212 NW2d 232 (1973), relied upon by plaintiffs, the St. Francis Cabrini school system did not provide tenure and the parties were not subject to the teacher tenure act, MCL 38.71 et seq.; MSA 15.1971 et seq. Moreover, the contract language supports the trial court’s statement that the plaintiffs’ employment was "at will.” Although the general policy provisions might suggest that the plaintiffs were "just cause” employees, the unambiguous terms of the contracts allow either the employer or the employee to terminate the employment relationship after giving thirty days’ notice. The mutual right to terminate the employment following such notice is incompatible with a "just cause” employment relationship. Patillo v Equitable Life Assurance Society of the United States, 199 Mich App 450; 502 NW2d 696 (1993); Jontig v Bay Metropolitan Transportation Authority, 178 Mich App 499; 444 NW2d 178 (1989). We decline to address the issues raised by defendants on cross appeal, because defendants did not condition their stipulation and consent to the court’s final orders upon the right to appeal the court’s earlier refusal to grant their motion for summary disposition. Additionally, because the final orders granting summary disposition are in defendant’s favor, defendants are not "aggrieved” and are not entitled to an appeal as of right. Reddam v Consumer Mortgage Corp, 182 Mich App 754; 452 NW2d 908 (1990). Affirmed.
NIEVES v BELL INDUSTRIES, INC Docket No. 140379. Submitted December 7, 1993, at Detroit. Decided April 4, 1994, at 9:55 a.m. Russell Nieves brought an action in the Washtenaw Circuit Court against Bell Industries, Inc., and others, alleging wrongful discharge in violation of an oral agreement for, and legitimate expectation of, employment terminable for just cause only and alleging misrepresentation. The defendants moved for summary disposition, arguing that employment had been terminable at will as stated in an application form and compensation agreement signed by the plaintiff, as well as in an employee handbook given to the plaintiff. The court, Patrick J. Conlin, J., denied the motion. The defendants appealed by leave granted. The Court of Appeals held: 1. Where, as in this case, an employment contract expressly provides for employment at will, an employee, by signing the contract, assents to employment at will and may not maintain an action based on a prior oral agreement for just-cause employment. 2. A claim based on legitimate expectations of just-cause employment must rest on the employer’s promises to the work force in general, not, as occurred in this case, to an individual employee. 3. A person who, like the plaintiff, has the means to determine that a representation is not true cannot maintain an action for misrepresentation. Reversed. 1. Master and Servant — Termination of Employment — Contracts. An employee who signs an employment agreement that provides for termination at the will of either the employer or the employee assents to at-will employment and may not maintain an action for wrongful discharge based on a prior oral agreement for termination for just cause only. References Am Jur 2d, Fraud and Deceit §§ 247 et seq.; Master and Servant §§ 27 et seq. Employer’s misrepresentation as to prospect, or duration of, employment as actionable fraud. 24 ALR3d 1412. 2. Master and Servant — Just-Cause Employment. An action for wrongful discharge based on legitimate expectations of employment terminable for just cause must rest only on the employer’s promises to the work force in general rather than to the particular employee. 3. Fraud — Misrepresentation — Knowledge op Falsehood. Fraud cannot be perpetrated against a person who has the means to determine that a representation is not true. Chambers, Steiner, Mazur, Ornstein & Amlin, P.C. (by Michelle J. Harrison and Angela J. Ni-cita), for the plaintiff. Cohen & Warren, P.C. (by David W. Warren and Robert J. Essick), for the defendants. Before: Griffin, P.J., and Mackenzie and J. E. Mies, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Mackenzie, J. This is an action for wrongful discharge and misrepresentation. Defendants appeal by leave granted from an order denying their motion for summary disposition. We reverse. Plaintiff interviewed with defendant David Lerner for the position of general manager of defendant Bell Industries’ Ann Arbor office in May 1988. According to plaintiff, Lerner offered assurances that the position was "long-term” and assured plaintiff that he would not be arbitrarily fired. The following day, Lerner called plaintiff to offer him the position, and plaintiff asked if defendants would be willing to make a written offer. On May 26, 1988, plaintiff received a letter from Lerner that included a written offer and informed plaintiff that "[ajn Employment Contract will be issued after your acceptance of Bell Industries^] proposal.” Plaintiff called Lerner the same day, accepted the position, and asked about the employment contract. Plaintiff claims that Lerner told him that it "was merely a breakdown of the medical plan, it would summarize the base income and these incentive programs.” On June 6, 1988, plaintiff completed an application for employment with Bell Industries. The application stated that employment could be terminated at any time at the will of the employer. The application also stated that the termination policy could not be changed except in writing signed by an authorized representative of the company. Plaintiff stated that when he questioned Lerner regarding the at-will employment language, Lerner told him that the provision did not apply to him. Plaintiff commenced his employment with Bell Industries on June 13, 1988. At a training session, he received an employee handbook that provided that employment could be terminated at any time with or without cause and with or without notice. The handbook also provided that the policy could only be changed in a writing signed by the president or vice president of the company. According to plaintiff, he understood that the manual applied to his subordinates. On August 29, 1988, plaintiff was given a document entitled "General Manager’s Compensation Agreement.” The agreement provided that it could be terminated at any time with or without cause. When plaintiff asked Lerner to strike the language, Lerner replied that he did not have the authority to do so, but that it did not apply to plaintiff. Plaintiff signed the document after Lerner told him that his employment would have to be discontinued if he did not sign. While plaintiff recognized that Lerner did not have the authority to delete the at-will language, Lerner assured him that it was just boiler plate. On October 21, 1988, Bell Industries terminated plaintiffs employment. Plaintiff stated that he received no warning that his work was unsatisfactory, and that he was not given a chance to rectify any problems. Plaintiffs discharge slip indicated that he was discharged for cause because of his inability to "keep on top of’ Bell’s policies and procedures. This suit, alleging wrongful discharge and misrepresentation, followed. Defendants first contend that the trial court erred in not dismissing plaintiffs wrongful discharge claim. We agree. There is a strong presumption that an employment contract for an indefinite duration, such as the contract in this case, is terminable at the will of either party for any reason or no reason at all. Coleman-Nichols v Tixon Corp, 203 Mich App 645, 655; 513 NW2d 441 (1994). In Rood v General Dynamics Corp, 444 Mich 107; 507 NW2d 591 (1993), our Supreme Court reiterated that a just-cause employment relationship can arise either by contract or by an employee’s legitimate expectations in reliance on company policies. Under a contractual theory, a party must present sufficient proof either of a contractual provision for a definite term of employment or of a provision forbidding discharge absent just cause. Rood, supra, p 117. Such provisions may become part of an employment contract as a result of explicit promises or promises implied in fact. Id. Oral statements of job security must be clear and unequivocal to overcome the presumption of employment at will. Id., p 119, quoting Rowe v Montgomery Ward & Co, Inc, 437 Mich 627, 645; 473 NW2d 268 (1991). Under the legitimate expectations theory, a party may overcome the presumption of employment at will by establishing that the employer’s policies and procedures have become a legally enforceable part of an employment relationship if such policies and procedures instill legitimate expectations of discharge for just cause only. Rood, supra, pp 117-118. The courts must determine whether a promise has been made and whether the promise is reasonably capable of instilling in employees a legitimate expectation of just-cause employment. Rood, supra, p 140. In this case, plaintiff argues that there was an express oral agreement of just-cause employment in light of the promises made during his interview and because of Lerner’s job offer and plaintiff’s acceptance. Alternatively, plaintiff argues that the policies and procedures of Bell Industries created a legitimate expectation of just-cause employment. Even if we were to agree that there was an oral agreement that plaintiff had a just-cause employment contract, the General Manager’s Compensation Agreement that plaintiff signed clearly and unambiguously defined the terms of plaintiff’s employment, including the company’s at-will employment policy. Plaintiff was aware that Lerner could not change that term. One who signs a contract cannot seek to avoid it on the basis that he did not read it or that he supposed that it was different in its terms. Stopczynski v Ford Motor Co, 200 Mich App 190, 193; 503 NW2d 912 (1993). When an employment contract expressly provides for employment at will, a plaintiff, by signing the contract, assents to employment at will and cannot maintain an action based on a prior oral agreement for just-cause employment. Stopczynski, supra, p 193; Scholz v Montgomery Ward & Co, Inc, 437 Mich 83; 468 NW2d 845 (1991). See also In re Certiñed Question, 432 Mich 438; 443 NW2d 112 (1989); Rowe, supra; Grow v General Products, Inc, 184 Mich App 379; 457 NW2d 167 (1990); Pepper-man v Automobile Club of Michigan Ins Group, 181 Mich App 519; 450 NW2d 66 (1989). While plaintiff may have had a subjective expectation that his employment could not be terminated except for just cause, such an expectation in and of itself does not create a just-cause employment contract. Schwartz v Michigan Sugar Co, 106 Mich App 471, 478; 308 NW2d 459 (1981). Finally, we reject plaintiff’s suggestion that the terms of the General Manager’s Compensation Agreement may be voided on the basis of duress. See Apfelblat v Natl Bank Wyandotte-Taylor, 158 Mich App 258; 404 NW2d 725 (1987). We likewise reject plaintiff’s alternative argument based on legitimate expectations of just-cause employment. A claim based on legitimate expectations rests on the employer’s promises to the work force in general rather than to an individual employee. In re Certified Question, supra, p 443, n 3. Here, Bell’s job application, handbook, and compensation agreement all promised at-will employment. Defendant also contends that the trial court erred in refusing to dismiss plaintiff’s misrepresentation claim. We agree. A misrepresentation claim requires reasonable reliance on a false representation. See State-William Partnership v Gale, 169 Mich App 170; 425 NW2d 756 (1988). There can be no fraud where a person has the means to determine that a representation is not true. Montgomery Ward & Co v Williams, 330 Mich 275; 47 NW2d 607 (1951); Webb v First of Michigan Corp, 195 Mich App 470, 474; 491 NW2d 851 (1992). Here, plaintiff acknowledged that he read the at-will employment language in the various documents presented to him and that Lerner could not alter the terms of the employment agreement. He chose to believe Lerner rather than the signed contract. However, a plaintiff cannot claim to have been defrauded where he had information available to him that he chose to ignore. Webb, supra, p 475. Reversed.
THORIN v BLOOMFIELD HILLS BOARD OF EDUCATION Docket No. 141676. Submitted October 20, 1993, at Detroit. Decided February 22, 1994, at 9:30 A.M. Fred D. Thorin brought an action in the Oakland Circuit Court against the Bloomfield Hills Board of Education and others, alleging wrongful discharge after the board voted not to renew the last of a series of employment contracts under which he served as superintendent of the Bloomfield Hills Public Schools for terms of two years each. The plaintiff alleged that the defendants had assured him employment until retirement and that, if his employment was terminated because of unsatisfactory performance, he should have been provided a one-year program of assistance during which to show improvement, as provided in an employment handbook. The defendants moved for summary disposition, contending that the plaintiffs employment was governed solely by the terms of his contract and that the handbook did not apply to the plaintiff. The court, Robert L. Templin, J., denied the motion. The Court of Appeals, Gkibbs, P.J., and Holbrook, Jr., and Reilly, JJ., affirmed in an unpublished opinion per curiam, decided October 3, 1989 (Docket No. 105031), stating that the plaintiffs theory of liability is analogous to that addressed in Touissant v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980). A jury subsequently rendered a verdict for the plaintiff, awarding him damages of $558,000, comprising six years of his salary at $88,000 a year and an early retirement bonus of $30,000. The defendants appealed. The Court of Appeals held: 1. The trial court did not err in denying the defendants’ motion for judgment notwithstanding the verdict. The jury reasonably could have concluded that the decision not to renew the plaintiffs employment contract was based on unsatisfactory performance. References Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions §§ 327, 331, 333; Municipal County, School, and State Tort Liability § 639; Wrongful Discharge § 90. See ALR Index under At Will Relationship; Discharge from Employment or Office. 2. The doctrine of law of the case requires the Court of Appeals to hold that the trial court did not err in instructing the jury in accordance with Touissant. 3. Touissant applies to public employees as long as the resulting implied contract does not violate the employer’s statutory authority. In this case, MCL 380.131(1); MSA 15.4132(1), which limits employment contracts of public school superintendents to no more than three years in duration, would not be violated in allowing a one-year extension of the plaintiffs final two-year contract for a program of assistance for unsatisfactory performance. Accordingly, the plaintiff is entitled to damages of $118,000, consisting of one-year’s salary of $88,000 and the $30,000 early retirement bonus. On remand, the plaintiff may consent to the entry of a judgment for $118,000 plus interest and costs or request, and be allowed, a new trial solely on the issue of damages. 4. The remaining issues raised by the defendants are without merit or were not properly preserved for appellate review. Affirmed in part, reversed in part, and remanded. Corrigan, P.J., concurring, stated that the scope and nature of wrongful discharge remedies available to public sector employees warrants Supreme Court review. Master and Servant — Employment Contracts — Public Employees A wrongful discharge claim based on Touissant v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980), can be maintained by a public sector employee only where the resulting implied contract does not exceed the employer’s statutory authority. Googasian, Hopkins, Hohauser & Forhan (by George A. Googasian) (Bendure & Thomas, by Mark R. Bendure and Amy R. Snell, of Counsel), for the plaintiff. Butzel Long (by Virginia F. Metz and David B. Calzone), for the defendants. Before: Corrigan, P.J., and Neff and R. J. Colombo, Jr., JJ. Circuit judge, sitting on the Court of Appeals by assignment. R. J. Colombo, Jr., J. Defendants appeal as of right a jury verdict awarding the plaintiff damages of $558,000 on his wrongful discharge claim. A judgment including costs and interest was entered on April 10, 1991, in the amount of $1,121,308.66. We affirm in part and reverse in part. i The plaintiff was hired as superintendent for defendants’ school district on July 1, 1970. Plaintiff worked under a series of employment contracts and contract supplements. On May 17, 1983, plaintiff signed a letter agreement supplementing the employment contract of July 1, 1980, which extended his employment to June 30, 1985. In June 1984, the president of the school board, Edward Fleischmann, called the plaintiff and advised that he did not believe plaintiff’s contract would be renewed. Plaintiff mentioned he had rights under the administrative handbook and asked about the possibility of a six-month extension. Pursuant to Fleischmann’s instructions, plaintiff made a written request for a six-month extension in a memorandum dated July 6, 1984. The memorandum also set forth plaintiff’s claim that under the terms of the handbook he was entitled to one year’s notice before termination or nonrenewal for unsatisfactory performance. The handbook for July 1, 1983, through June 30, 1986, provided in pertinent part: Terms of Employment Subject to the limitations listed below, the Board of Education agrees that each administrator will be employed for a term of two years, commencing July 1, 1979, and continuing from year to year thereafter unless notification is given by either party, to comply with law as provided in Act 269, PA 1955, as amended by Act 247, PA 1970. 2. Unsatisfactory Performance: A program of assistance shall be instituted as soon as practicable, but no later than February 1 of either year of the administrator’s contract. If after one year of such assistance program, the administrator’s performance is not satisfactory, then, upon 90-day written notice prior to the terminal date of the administrator’s contract, employment may be terminated. Plaintiff and defendants attempted to negotiate a resolution under which plaintiff would be granted a six-month extension as a consultant. Unfortunately, the parties could not agree upon compensation. On December 4, 1984, the board of education voted unanimously not to renew or extend plaintiff’s contract. In a letter dated December 10, 1984, the board advised the plaintiff of its action. This lawsuit ensued. n The first issue raised by the defendants is that the trial court erred in failing to grant their motion for judgment notwithstanding the verdict. They contend that the undisputed evidence established that unsatisfactory performance was not the reason for defendants’ failure to extend or renew plaintiff’s contract. Rather, this action was taken because of a change in membership of the board and its belief that it was time for different leadership. Furthermore, plaintiff had been planning retirement, and granting plaintiff a six-month extension and finding a new superintendent in the middle of the school year were not in the best interest of the school district. In reviewing a trial court’s failure to grant a defendant’s motion for judgment notwithstanding the verdict, we examine the testimony and all legitimate inferences that may be drawn in the light most favorable to the plaintiff. Matras v Amoco Oil Co, 424 Mich 675, 681; 385 NW2d 586 (1986). If reasonable jurors could honestly have reached different conclusions, neither the trial court nor this Court may substitute its judgment for that of the jury. Reisman v Regents of Wayne State Univ, 188 Mich App 526, 538; 470 NW2d 678 (1991). During opening statement, counsel for defendants suggested that because plaintiff had been the superintendent for a long time, there was a tendency to "cut corners.” As an example, counsel stated that the school board paid plaintiff money for a country club membership without action by the school board at a public meeting and official minutes. Counsel told the jury that it would be satisfied with the proofs that this was the board’s motivation for what occurred. During the trial, the school district’s business manager testified there was no other administrator or employee in the school district who was paid wages on verbal directions, spent more for insurance or any other item than the contract provided, and charged personal expenses to the school district. This evidence was to demonstrate that plaintiff used school district funds without legitimate authorization. Finally, there was evidence that once plaintiff filed this lawsuit, the defendants filed a counterclaim. It alleged that plaintiff received pay increases without proper authorization of the school board. Reasonable jurors could have concluded that the decision not to extend or renew plaintiffs contract was due to unsatisfactory performance relating to unauthorized expenditures. The trial court properly denied defendants’ motion for judgment notwithstanding the verdict. in The next issue raised by defendants is that this case was tried under an erroneous legal theory when the trial court improperly instructed the jury in accordance with Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980). They contend that the trial court was not bound by this Court’s prior opinion in Thorin v Bloomfield Hills Bd of Ed, (Docket No. 105031) (Thorin I), unpublished opinion per curiam, decided October 3, 1989, because the opinion was issued without the benefit of a full development of the facts. Defendants rely upon this Court’s statements in Thorin I that "Plaintiffs theory of liability is analogous to that addressed in Toussaint” and "may evolve into a Toussaint-type of contractual entitlement.” Accordingly, defendants believe Thorin I did not establish the law of the case. The doctrine of the law of the case arises where an appellate court has passed on a legal question and remanded the case for further proceedings. Under the doctrine, the legal questions determined by the appellate court will not be differently determined on a subsequent appeal in the same case where the facts remain materially the same. CAF Investment Co v Saginaw Twp, 410 Mich 428, 454; 302 NW2d 164 (1981). The law of the case does not apply to an issue that was raised but not decided by an appellate court. Hill v Clark Equipment Co, 85 Mich App 1, 3; 270 NW2d 722 (1978). In Thorin I, our Court held that plaintiffs contractual rights could be determined from his written contracts and the handbook under a theory of liability analogous to Toussaint. We cited Toussaint, supra at 614-615, for the principle that the employer’s statements of policy contained in an employment manual can give rise to contractual rights. We rejected defendants’ claim that Toussaint did not apply to a fixed-term contract subject to periodic renewal. To the extent defendants are contending that Toussaint does not apply to a fixed-term contract that has expired and the written contracts and handbook established that the handbook did not apply to plaintiff, the doctrine of the law of the case applies. These issues were considered in Thorin I and may not be reconsidered in this appeal. Moreover, defendants’ failure to object to the jury instructions precludes appellate review absent a miscarriage of justice. Moghis v Citizens Ins Co of America, 187 Mich App 245, 251; 466 NW2d 290 (1991). We find no miscarriage of justice. IV1 Defendants have raised the issue that Toussaint does not apply in this case because Toussaint does not apply to public employees, all actions by the school board must be approved by a majority vote at a public hearing, MCL 380.1201(1); MSA 15.41201(1), and the school board’s contract with the superintendent shall be for a term not to exceed three years. MCL 380.132(1); MSA 15.4132(1). Defendants assert implied contracts are inconsistent with these statutory requirements imposed upon a school board. A threshold issue is whether Thorin I precludes consideration of this issue. We conclude that the law of the case does not bar consideration of this issue because it was not decided in Thorin I. In Manning v City of Hazel Park, 202 Mich App 685; 509 NW2d 874 (1993), this Court held that Toussaint applies to public employees. This was premised upon the Michigan Supreme Court’s reliance in Toussaint on Perry v Sindermann, 408 US 593; 92 S Ct 2694; 33 L Ed 2d 570 (1972). In Perry, the United States Supreme Court approved the concept of a constitutionally protected interest in continued employment based on an implied contract where the plaintiff was a public employee. Accordingly, Manning concluded that a public employee may maintain a wrongful discharge claim básed on Toussaint. Manning did not address whether there is any limitation on Toussaint’s application to public employees. Three cases in the United States District Court of Michigan have addressed the issue of Toussaint's applicability to public employees. See Merrell v Bay Co Metropolitian Transportation Authority, 707 F Supp 289 (ED Mich, 1989); Willoughby v Village of Dexter, 709 F Supp 781 (ED Mich, 1989); Bennett v Marshall Public Library, 746 F Supp 671 (WD Mich, 1990). These cases also provide guidance with regard to whether there are limitations on Toussaint’s application to public employees. In Merrell, the district court noted that the Michigan Supreme Court explicitly recognized that the genesis of the implied contract was the United States Supreme Court’s decision in Perry, supra. Perry clearly sanctioned the concept of a constitutionally protected interest in public employment based on an implied contract. The district court concluded that Toussaint’s heavy reliance on Perry offered strong support for extending implied contracts to public employees in Michigan. Merrell, supra at 292. In Willoughby, supra, the district court concluded that Toussaint did not apply to public employees. The plaintiff was removed as village manager. An ordinance authorized the council to remove the village manager by majority vote. The ordinance was silent with respect to the need for grounds for removal. The district court determined that the council could not bind future councils by entering into a just-cause contract for an indefinite duration with the village manager. This would negate the power of future councils to discharge under the ordinance. Willoughby, supra at 787. In Bennett, supra, the district court again faced the issue of Toussaint’s application to public employees and reconciled the holdings in Merrell and Willoughby. The court determined that Toussaint applied to public employees only where the resulting implied contract does not exceed the controlling body’s statutory authority. In Bennett the plaintiff was the city’s librarian and claimed that she could only be removed for just cause. A state statute authorized a city’s library board to remove the librarian. The district court found that the plaintiff stated a Toussaint claim as a public employee. This was because a one-year employment contract for just cause did not violate the statutory authority of the library board to remove the librarian and would not create binding obligations on future library boards. Bennett, supra at 671. The reasoning of the district court in Bennett is persuasive. It is reasonable to assume, as did our Court in Manning, that the Michigan Supreme Court intended Toussaint to apply to public employees in light of its reliance upon Perry. Likewise, a public employee cannot claim an implied contract where it violates the controlling body’s statutory authority. Plaintiffs claim of a one-year program of assistance for unsatisfactory performance under the terms of the handbook was consistent with MCL 380.1201(1); MSA 15.41201(1), requiring school board action by a majority vote at a public meeting. Defendants did not assert that the handbook had not been adopted in accordance with this statute. Rather, they stated that the handbook did not apply to plaintiff. Defendants’ erroneous belief does not mean that the handbook was not adopted by a majority vote of the school board at a public meeting. Defendants did not argue at trial that plaintiffs contract extension to June 30, 1985, had not been adopted in accordance with MCL 380.1201(1); MSA 15.41201(1). Although the defendants initially asserted this in their counterclaim, the assertion was withdrawn before trial. Plaintiffs claim to damages through June 30, 1986, did not violate the provisions of MCL 380.132(1); MSA 15.4132(1), which limits contracts with the superintendent to a term not to exceed three years. Plaintiffs last employment contract was extended for two years to June 30, 1985. An additional one-year program of assistance under the handbook would extend the contract to three years and not violate the provisions of MCL 380.132(1); MSA 15.4132(1). However, plaintiff argued at trial that he was entitled to damages after June 30, 1986. This argument was based upon plaintiffs expectation of continued employment until retirement absent just cause for termination and a program of assistance. With a two-year contract extended one year for a program of assistance, plaintiff could only have legitimately expected that he would not be discharged absent just cause until June 30, 1986. Moreover, MCL 380.132(1); MSA 15.4132(1) only authorized a contract for three years. The defendants had no authority to approve a contract for more than three years. Plaintiff was not entitled to damages beyond June 30, 1986. The jury was given various alternatives for assessing damages. One alternative was to award damages of $88,000 a year for six years and a $30,000 early retirement benefit for a total of $558,000. It is reasonable to conclude that the jury computed damages under this method because this was the amount of its verdict. Plaintiff was entitled to damages of $88,000 for lost salary from July 1, 1985, through June 30, 1986, and $30,000 for an early retirement benefit for a total of $118,000. If plaintiff consents in writing to the entry of a judgment in the amount of $118,000 plus interest and costs within twenty-eight days after the expiration of the time limit for pursuing an appellate remedy as of right, a judgment shall enter. Otherwise, plaintiff is entitled to a new trial solely on the issue of damages. v Defendants also contend that the evidence that the handbook applied to plaintiff did not meet the clear and unequivocal standard set forth in Rowe v Montgomery Ward & Co, Inc, 437 Mich 627, 645; 473 NW2d 268 (1991). In addition, they claim that the testimony of individual school board members regarding this issue was made without authority and could not bind the defendants. Defendants assert that it was error to fail to give their proposed instructions relating to the authority of the school board. In Rowe, supra, the Michigan Supreme Court held that oral statements of job security must be clear and unequivocal to overcome the presumption of employment at will. Id. at 645. This rule has no application to the instant case. This case did not involve a claim of employment at will or oral statements of job security. It presented a factual dispute regarding whether the unsatisfactory performance provision in the handbook applied to plaintiff. The testimony of school board members, employees, defendants’ former attorney, and plaintiff sufficiently supported the jury’s conclusion that the provision in the handbook applied to pláintiff. The testimony of school board members regarding this issue was not offered to demonstrate that defendants had adopted the handbook. As noted above, that was never disputed at trial. Rather, the testimony was for the purpose of resolving the issue of the application to plaintiff of the unsatisfactory performance provision in the handbook. There was no error in failing to instruct regarding the requirements for officia
KENNETH W. LONG and ROBERT C. HOWE, Plaintiffs-Appellants v. VERTICAL TECHNOLOGIES, INC., a North Carolina corporation, and MELLON BANK, N.A., a National Banking Association, Defendants-Appellees No. 9220SC1110 (Filed 15 February 1994) 1. Libel and Slander §§ 43, 44 (NCI4th)— slander —plaintiffs’ misuse of company resources — statements protected by qualified privilege — statements not actionable per se The trial court did not err in allowing defendants’ motion for partial summary judgment on plaintiffs’ complaint for slander and defamation since the statements in question were made during a staff meeting regarding plaintiffs’ termination of employment; one plaintiff acknowledged that the statements were made in good faith and without malice; the statements thus were not actionable by reason of qualified privilege; and though the statements may have related to plaintiffs’ not doing business in the best interests of defendant or their misuse of company resources, the statements nevertheless were not actionable per se as it was not shown that they were false, touched plaintiffs in their trade or occupation, and contained an imputation necessarily hurtful in its effect on plaintiffs’ business. Am Jur 2d, Libel and Slander § 444. 2. Labor and Employment § 68 (NCI4th)— no wrongful termination of employment —sufficiency of evidence The trial court did not err in failing to find that plaintiffs were wrongfully terminated where the evidence tended to show that plaintiffs sold their computer software company, VTI, to defendants; plaintiffs entered into employment agreements with VTI; plaintiffs subsequently formed two new companies while working for VTI; they did not disclose to defendants all of their activities with regard to use of VTI property to further the affairs of their company, including use of VTI employees, facilities, computers, computer programs, telephone number and address; and plaintiffs still had a fiduciary duty of loyalty and fair dealing as long as they were employees of VTI. Am Jur 2d, Master and Servant §§ 60-70. 3. Labor and Employment § 39 (NCI4th) — breach of loyalty and fiduciary obligations by employees — damages —sufficiency of evidence The trial court did not err in finding that defendant was entitled to recover from plaintiffs approximately $70,000 representing the fair value of services plaintiffs caused defendant to provide to plaintiffs’ company which they operated on the side, since the evidence showed that plaintiffs caused defendant’s employees to spend 753 hours of work time on the development of plaintiffs’ side company’s products, and defendant presented evidence that the hourly rate for the work was $93. Am Jur 2d, Master and Servant §§ 2, 14. Appeal by plaintiffs from judgment entered 23 July 1992 by Judge Melzer A. Morgan, Jr. in Union County Superior Court. Heard in the Court of Appeals 5 October 1993. Koy E. Dawkins, P. A., for plaintiffs-appellants. Robinson, Bradshaw & Hinson, P. A., by A. Ward McKeithen, for defendants-appellees. JOHNSON, Judge. Plaintiff Kenneth W. Long (Long) formed a corporation, Vertical Technology, Inc. (VTI) in 1984. VTI operated under the name of Backroom Systems Group, developing and selling computer programs to be used with small computers or PC’s in the financial industry. Plaintiff Robert C. Howe (Howe) was Senior Vice President and Operations Manager for VTI. In September 1988, VTI was purchased by defendant Mellon Bank (Mellon) and both Long and Howe entered into employment agreements with VTI for a term of three years; the agreements were identical except as to salary and bonus compensation. In 1990, Mellon began putting VTI’s employees, including Long and Howe, on the Mellon payroll. This caused conflicts between Long, Howe and the Mellon officers. In the summer of 1990, Long and Howe were informed they were going to be terminated because of these conflicts, but compensated until the end of their respective employment agreements. Long and Howe then formed two new companies, Financial Systems Group, Inc. (FSG) and Protocorp, Inc., which they planned to operate after their termination. However, the Mellon officer who had decided to terminate Long and Howe left before the termination was put into effect, and Long and Howe were not terminated that summer. In August of 1990, the Mellon officer in charge of VTI, Allan Woods (Woods) met with Long and began discussing a buy-back or repurchase of VTI by Long and Howe. During the exchange of offers and negotiations, Long wrote Woods a letter in which he disclosed the formation of the two new companies; discussed alternatives for the survival of VTI, including the repurchase from Mellon Bank; and stated “I feel very awkward at this point proposing any sort of business case from a Mellon manager point of view. The only alternative I feel I am left with is to approach you as one business man to another looking for a deal that will be mutually beneficial.” One of the new companies formed by Long and Howe, FSG, was operated by Terry Nelson (Nelson), a former VTI sales representative. In October 1990, Nelson sent out solicitation letters introducing FSG, identifying himself as a former VTI employee, and identifying Long and Howe as president and senior vice president of VTI and as “other principals” of FSG. This letter went to a number of VTI and Mellon customers. In January 1991, a force of Mellon officers and employees including the newly elected President of VTI, James Luisi, took over the operation of VTI and terminated Long and Howe. Long and Howe were informed they were terminated “for cause” and would be compensated only for January 1991. Long and Howe both filed an action against VTI and Mellon alleging wrongful termination, slander and defamation. VTI and Mellon countered alleging breach of loyalty and fiduciary obligations and claiming damages for Long and Howe using VTI facilities and personnel in connection with FSG projects. A motion for summary judgment was filed by defendants on the issues of slander and defamation, and the trial court granted defendants partial summary judgment. Plaintiffs’ claim for wrongful termination and defendants’ counterclaims were tried before the trial court without a jury in Union County Superior Court. The trial judge held for defendants and entered judgment against plaintiffs. From the judgment entered, plaintiffs appeal. The first issue presented for review is whether the trial court erred in allowing defendants’ motion for partial summary judgment on plaintiffs’ complaint, count II slander and defamation. Summary judgment is a device whereby judgment is rendered “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with any affidavits, if any, show that there is no genuine issue of material fact and that a party is entitled to judgment as a matter of law.” N.C.R. Civ. P. 56(c). “Thus a defending party is entitled to summary judgment if he can show that claimant cannot prove the existence of an essential element of his claim, ... or cannot surmount an affirmative defense which would bar the claim.” Dickens v. Puryear, 302 N.C. 437, 453, 276 S.E.2d 325, 335 (1981) (citation omitted). “In ruling on a motion for summary judgment the evidence is viewed in the light most favorable to the non-moving party.” Hinson v. Hinson, 80 N.C. App. 561, 563, 343 S.E.2d 266, 268 (1986) (citation omitted). The issue before us then is whether the evidence taken in a light most favorable to plaintiffs was sufficient to establish any genuine issue of material fact. We hold as a matter of law, it was not. Plaintiffs contend that James Luisi, the newly elected President of VTI, slandered or defamed plaintiffs by making demeaning and prejudicial statements to third parties. The statements in question, “insinuated that Long and Howe were not handling business correctly and . . . doing something ‘shady’.” Defendants however, argue that the statements are qualifiedly privileged. Slander is commonly defined as “the speaking of base or defamatory words which tend to prejudice another in his reputation, office, trade, business, or means of livelihood.” . .. Slander, . . . may be actionable per se or only per quod. That is, the false remarks in themselves (per se) may form the basis of an action for damage, in which case both malice and damage are, as a matter of law, presumed; or the false utterance may be such as to sustain an action only when causing some special damage (per quod), in which case both the malice and the special damage must be alleged and proved. (Citations omitted.) Beane v. Weiman Co., Inc., 5 N.C. App. 276, 277, 168 S.E.2d 236, 237 (1969). However, even if it is determined that a statement is slanderous, the law recognizes certain communications as privileged. Privilege does not destroy the actionable character of a defamatory communication, but is available only by way of defense. A qualified or conditionally privileged communication is one made in good faith on any subject matter in which the person communicating has an interest, or in reference to which he has a right or duty, if made to a person having a corresponding interest or duty on a privileged occasion and in a manner and under circumstances fairly warranted by the occasion and duty, right or interest: Troxler v. Charter Mandala Center, Inc., 89 N.C. App. 268, 272, 365 S.E.2d 665, 668, disc. review denied, 322 N.C. 838, 371 S.E.2d 284 (1988) (citations omitted). The essential elements for the qualified privilege to exist are good faith, an interest to be upheld, a statement limited in its scope to this purpose, a proper occasion and publication in a proper manner and the proper parties only. Stewart v. Check Corp., 279 N.C. 278, 182 S.E.2d 410 (1971). Additionally, a qualified privilege may be lost by proof of actual malice on the part of the defendant. Id. The depositions of Enroth, and Fortson, employees of VTI to whom the alleged statements were made, show that the statements in question were made during a VTI staff meeting regarding the termination of Long and Howe. Additionally, Long acknowledged that the statements were made in good faith and without malice. Thus, the alleged statements are not actionable by reason of qualified privilege and the lack of evidence to support that the statements were not made in good faith and with malice. Alternatively, plaintiffs allege the statements made by defendants’ agent were slanderous per se because they were uttered about plaintiffs’ business or professional relationship. There are several categories of slander which are actionable per se: (1) statements which charge plaintiff with a crime or an offense of moral turpitude; (2) statements which impeach his/her trade or profession; (3) statements which impute to him/her a loathsome disease. Williams v. Freight Lines, Inc. and Willard v. Freight Lines, Inc., 10 N.C. App. 384, 179 S.E.2d 319 (1971). The alleged statements in question, are slander per se only if they come under the second category listed above, i.e., statements which impeach one’s trade or profession. In order to come within this category of slander, the false statement must do more than merely injure a person in his business. The false statement “ ‘(1) must touch the plaintiff in his special trade or occupation, and (2) must contain an imputation necessarily hurtful in its effect on his business.’ ” Tallent v. Blake, 57 N.C. App. 249, 253, 291 S.E.2d 336, 339 (1982) (citations omitted). Moreover, in order to be actionable, the defamatory statement must be false. The truth of a statement is a complete defense. Parker v. Edwards, 222 N.C. 75, 21 S.E.2d 876 (1942). From the depositions presented, it appears that the alleged slanderous comments were related to Long and Howe not doing business in the best interest of VTI and their misuse of VTI resources. We do not find that these statements meet the test set out in Tallent. Nor do we find that the statements are false. We therefore find the trial court correctly granted defendants partial summary judgment as to the slander and defamation claims. Plaintiffs argue next that the trial court erred in failing to find (1) that the relationship of Long and Howe to the newly formed companies was sufficiently disclosed to Mellon and that a new relationship existed between Long, Howe and Mellon after the letter dated 24 August 1990 and (2) that plaintiffs were wrongfully terminated. This argument relates to the findings of fact and conclusions of law made by the trial judge. The standard for review as to findings of fact made by a trial judge is the same standard used to evaluate a jury trial; the findings of fact are conclusive if supported by competent evidence. Williams v. Insurance Co., 288 N.C. 338, 218 S.E.2d 368 (1975). Where trial is by judge and not by jury, the trial court’s findings of fact have the force and effect of a verdict by a jury and are conclusive on appeal if there is evidence to support them, even though the evidence might sustain findings to the contrary. Id. Long and Howe argue that Long wrote a letter to Mellon in which he disclosed their formation of two new companies; discussed the alternatives for the survival of VTI, including the repurchase from Mellon; and stated “I feel very awkward at this point proposing any sort of business case from a Mellon manager point of view. The only alternative I feel I am left with is to approach you as one business man to another looking for a deal that will be mutually beneficial.” With that letter Long and Howe argue a new relationship existed because they began an exchange of offers and negotiations for Long and Howe to buy back VTI from Mellon. Plaintiffs also argue that this letter sufficiently disclosed to Mellon the formation and activities of the two new companies. However, we note that: (1) the letter did not sufficiently disclose all of the activities of Long and Howe in regard to their use of VTI property to further FSG affairs and (2) Long and Howe still had a fiduciary duty of loyalty and fair dealing as long as they were employees of VTI. In essence, no new relationship was formed as argued by plaintiffs. Additionally, Long and Howe admitted in their depositions that they did not disclose many of their activities to Mellon. They also acknowledged that they: (1) caused VTI resources, including employees, facilities, computers and computer programs to be used to develop the computer software products of FSG and to advance the business of FSG; (2) caused and allowed persons employed by and working for FSG and not employees of VTI to have offices at VTI and to have use of VTI computers and programs to develop FSG products; (3) used the VTI address and telephone number on promotional materials and products of FSG and maintained and stored FSG records and files on VTI’s computer system; and (4) themselves actively worked for and promoted FSG’s product and development and business during normal business hours. Manifestly, when a servant becomes engaged in a business which necessarily renders him a competitor and rival of his master, no matter how much or how little time and attention he devotes to it, he has an interest against his duty. It would be monstrous to hold that the master is bound to retain the servant in his employment after he has thus voluntarily put himself in an attitude hostile to his master’s interests. (Citations omitted.) In re Burris, 263 N.C. 793, 795, 140 S.E.2d 408, 410 (1965). Additionally, where an employee deliberately acquires an interest adverse to his employer, he is disloyal, and his discharge is justified. Id. The law as well as the evidence is thus clear. The trial court properly concluded that the activities of Long and Howe constituted: (1) a material breach of their express contractual duties under the agreements to perform their services in good faith and in the best interests of VTI; (2) a material breach of their fiduciary duty of good faith, fair dealing and loyalty to VTI; and (3) actions for which they should have been discharged. Next, plaintiffs contend and argue that defendants acted in bad faith by failing to inform them of concerns regarding conflicts of interest or a breach of fiduciary duties, even though it was considered a serious threat to plaintiffs’ continued employment and sale of VTI to them. However, we find that there is sufficient evidence to support the trial court’s finding that defendant Mellon engaged in good faith discussions with plaintiffs regarding the possible purchase of VTI. Additionally, we find that there is sufficient evidence to support defendant Mellon’s decision to continue to employ plaintiffs until they were able to form an honest belief that plaintiffs were no longer loyal or performing in good faith. Plaintiffs finally argue that the trial court erred in finding that VTI was entitled to recover from Long and Howe the sum of $70,029.00 representing the fair value of services plaintiffs caused VTI to provide to FSG. We disagree. The evidence shows that Long and Howe caused VTI employees to spend 753 hours of VTI work time on the development of FSG products. VTI presented evidence that the hourly rate for the work was $93.00. The evidence supports the trial court’s finding that VTI is entitled to $70,029.00. Therefore, we find the conclusion of the trial court, that Long and Howe were jointly and severally liable to VTI for the fair value of the services they caused VTI to provide FSG, and that the fair value of such services is $70,029.00 is fully supported by the evidence. The decision of the trial court is affirmed. Judges COZORT and McCRODDEN concur.
LIGGETT GROUP INC., Plaintiff v. ERNEST C. SUNAS, Defendant No. 9114SC957 (Filed 21 December 1993) 1. Appeal and Error § 89 (NCI4th)— partial summary judgment — ownership of patent —substantial right affected —appealable The grant of partial summary judgment for plaintiff in an action involving ownership of a patent for a tobacco quick-aging process was immediately appealable as affecting a substantial right where the trial court effectively decided that ownership of the process rested with plaintiff by granting summary judgment on the first of plaintiff’s six claims. This determination was fundamental to the disposition of plaintiff’s remaining claims. Am Jur 2d, Appeal and Error § 62. 2. Labor and Employment § 55 (NCI4th(— employee invention — ownership of patent —summary judgment for employer —error The trial court erred in granting summary judgment for plaintiff-employer on its first cause of action in a declaratory judgment action in which plaintiff sought to have its employee assign to it ownership of a patent for a quick-aging process for tobacco. The parties appear to agree that defendant invented the quick-aging process; there was no written contract detailing defendant’s duties as an analytic chemist; the affidavits and depositions establish that defendant was not originally hired to invent; the record is devoid of any evidence of an agreement between defendant and plaintiff that a handbook on which plaintiff relied was incorporated into defendant’s terms of employment; the handbook was first issued in 1976, years after defendant began his employment, and the contents appear to have been unilaterally implemented by plaintiff; the affidavit of a former employee of the Research Department contradicts the existence of any policy with regard to assignment of inventions between 1952 and 1973; while it is not clear whether defendant was directed to experiment with the quick-aging of tobacco earlier, there is no disagreement that plaintiff was told to continue work on the process in 1981; and the determination of whether defendant reduced his theory to practice only after being set to experimenting with the view of making an invention in 1981 was a determination for a trier of fact. Am Jur 2d, Master and Servant §§ 111-120. 3. Labor and Employment § 65 (NCI4th); Fraud, Deceit, and Misrepresentation § 38 (NCI4th)— promise to rehire if early retirement taken —employment at will — summary judgment not proper The trial court erred by entering summary judgment dismissing a counterclaim for fraudulent misrepresentation where each of the requisite elements was adequately pled by the employee and evidence was offered to support each element. A counterclaim for fraudulent misrepresentation is not barred merely because it concerns a promissory representation; fraud can be predicated upon a promissory representation when the promise is made with the intent to deceive and the promisor has no intent of performing his promise. Although the employer argues that the counterclaim is barred by the terminable-at-will doctrine, the employee is claiming that he was fraudulently induced into accepting early retirement and is not suing for wrongful discharge. Am Jur 2d, Fraud and Deceit § 481 et seq.; Master and Servant § 33. 4. Unfair Competition § 1 (NCI3d)— inducement to accept early retirement —unfair and deceptive practices — not applicable Employer-employee relationships do not fall within the scope of N.C.G.S. § 75-1.1 and the trial court properly entered summary judgment on a counterclaim for unfair and deceptive ' practices alleging the fraudulent inducement of retirement. Am Jur 2d, Monopolies, Restraints of Trade, and Unfair Trade Practices §§ 696, 697, 714. Practices forbidden by state deceptive trade practice and consumer protection acts. 89 ALR3d 449. Appeal by defendant from orders entered 22 January 1991 and 14 May 1991 by Judge Orlando F. Hudson in Durham County Superior Court. Heard in the Court of Appeals 13 November 1992. Newsom, Graham, Hedrick, Bryson & Kennon, by William P. Daniell and Joel M. Craig, for, plaintiff-appellee. Upchurch & Galifianakis, by Nick Galifianakis, and Lee L. Corum for defendant-appellant. JOHN, Judge. This action for declaratory and injunctive relief and for compensatory and punitive damages arises out of the issuance on 9 May 1989 of U.S. Letters Patent No. 4,827,949 (the patent) to defendant Ernest C. Sunas (Sunas), a retired employee of plaintiff Liggett Group Inc. (Liggett). Sunas contends the trial court erred by entering partial summary judgment on 22 January 1991 which (1) ordered Sunas to assign the patent to Liggett, and (2) dismissed his counterclaims. He also argues the trial court erred by denying his motion for a new hearing and to amend the summary judgment order. We agree in part and reverse the entry of summary judgment as to Liggett’s initial claim and as to one of Sunas’ counterclaims. The pleadings, depositions, affidavits and other materials before the trial court indicate Sunas, from 1954 until his retirement in 1987, worked as an analytic chemist in the Research Department of Liggett, a Durham-based corporation engaged in the manufacture of tobacco products. Throughout his employ, Sunas served as an employee-at-will with no written contract. The function of Liggett’s Research Department was to study problems facing the tobacco industry with an aim towards developing new products and reducing manufacturing costs. One concern centered upon the cost of storing cured tobacco which must be properly aged before it can be manufactured into cigarettes. “Aging” is the chemical process where, over time, tobacco aroma and taste characteristics are enhanced resulting in tobacco suitable for consumer uses. In the 1970s, Liggett began to experience financial difficulties, and a large number of Research Department employees consequently were discharged. Concerned about both his future and that of Liggett, Sunas began to consider ways of improving Liggett’s fortunes. In 1979, while watching his mother-in-law bake bread, Sunas hypothesized that the same chemical process which creates a “wonderful aroma” in baking bread could be used to age tobacco rapidly. If so, this would have financial benefit for Liggett by reducing storage costs. Sunas began researching the chemical process at work in baking bread, commonly known as the “Maillard reaction.” He eventually formulated an experiment by which he heated unaged tobacco treated with a simple sugar mixture. After a single experiment conducted on 19 February 1981, Sunas contacted Robert Kersey, Liggett’s Director of Research. Kersey, impressed with the results, authorized Sunas to continue work on this method of quick-aging tobacco. After further experimentation and refinement, Liggett’s management approved a patent application for the quick-aging process. Sunas prepared a description and forwarded it to Liggett’s patent counsel. The initial patent application designated Sunas, Kersey, and R.H. Wallick as co-inventors, but Sunas objected to inclusion of the others. A revised patent request was prepared listing Sunas as sole inventor, but at some point Liggett decided against patenting the procedure. Nevertheless, Sunas continued to work on refining it and making it commercially useful. In November 1986, Liggett offered some of its employees, including Sunas, a special early retirement program whereby the employee would receive an increase in pension benefits by taking early retirement. At the time of this limited offer, Sunas was 66 years old and the mandatory retirement age at Liggett was 70. Sunas accepted the program and retired on 1 March 1987. Sunas claims, and Liggett denies, he was induced to accept early retirement by a verbal promise to be re-hired as a special consultant earning $200 per day. After learning he would not be re-hired, Sunas decided to patent the quick-aging process and employed a Durham law firm as his patent counsel. In preparing a description, Sunas used copies of the original Liggett patent request forms he had retained. He also utilized an official Liggett laboratory notebook regarding the procedure which he had obtained after his retirement. Sunas never notified Liggett he was seeking a patent, but an application was ultimately submitted to the U.S. Patent Office in September of 1987. Thereafter, Sunas began to contact Liggett’s competitors in an effort to lease the process. Following an initial rejection of the application and subsequent modification thereto, Sunas was issued Patent No. 4,827,949, entitled “Method of Treating Tobacco and Tobacco Produced Thereby.” On 23 June 1989, after receiving notice of Sunas’ patent, Liggett instituted the instant lawsuit alleging six (6) claims: (1) a request for declaratory relief ordering Sunas to assign the patent to Liggett; (2) misappropriation of the quick-aging process; (3) breach of confidentiality by informing others of the process; (4) breach of fiduciary duties; (5) misappropriation of trade secrets; and (6) a request for injunctive relief to prohibit Sunas and others from utilizing the patented process. After the trial court ordered temporary injunctive relief, Sunas answered the complaint, denying all material allegations and asserting several counterclaims. On 18 October 1990, Liggett moved for summary judgment. By order entered 22 January 1991, the trial court granted Liggett partial summary judgment which (1) ordered Sunas to assign the patent to Liggett, and (2) dismissed all of Sunas’ counterclaims, but (3) expressly withheld determination regarding Liggett’s remaining claims. On'28 January 1991, Sunas moved for (1) a new hearing and (2) an amendment to the summary judgment order. By order entered 14 May 1991, these motions were denied. I. Initially, we must resolve Liggett’s motion, filed in this Court, seeking dismissal of Sunas’ appeal as interlocutory. A grant of partial summary judgment, because it does not completely dispose of the case, is an interlocutory order from which there is ordinarily no right of appeal. N.C.R. Civ. P. 54(b) (1990); Britt v. American Hoist & Derrick Co., 97 N.C. App. 442, 444, 388 S.E.2d 613, 615 (1990). Such a prohibition promotes judicial economy by preventing fragmentary appeals. Blue Ridge Sportcycle Co. v. Schroader, 53 N.C. App. 354, 358, 280 S.E.2d 799, 801-02 (1981). Nonetheless, in two instances a party is permitted to appeal interlocutory orders: first, where there has been a final determination of at least one claim, and the trial court certifies there is no just reason to delay the appeal, Rule 54(b); Davidson v. Knauff Ins. Agency, Inc., 93 N.C. App. 20, 24, 376 S.E.2d 488, 490-91, disc. review denied, 324 N.C. 577, 381 S.E.2d 772 (1989); and second, if delaying the appeal would prejudice a “substantial right.” Knauff Ins., 93 N.C. App. at 24, 376 S.E.2d at 491. As the court below made no certification, the first avenue of appeal is closed. Regarding the second, it has been frequently noted the substantial right test is much more easily stated than applied. Green v. Duke Power Co., 305 N.C. 603, 606, 290 S.E.2d 593, 595 (1982). There are few general principles governing what constitutes a “substantial right” and thus it is usually necessary to consider the particular facts of each case and the procedural context in which the interlocutory decree was entered. Id.; Knauff Ins., 93 N.C. App. at 24, 376 S.E.2d at 491. A substantial right, however, is considered affected if “there are overlapping factual issues between the claim determined and any claims which have not yet been determined” because such overlap creates the potential for inconsistent verdicts resulting from two trials on the same factual issues. Knauff Ins., 93 N.C. App. at 26, 376 S.E.2d at 492. In the case sub judice, because of the close relationship between the claim of Liggett adjudicated by the trial court and those which remain, we believe a “substantial right” is involved. By granting summary judgment on Liggett’s first claim, thereby ordering Sunas to assign the patent, the trial court effectively decided ownership of the patented quick-aging process rested with Liggett. This determination is fundamental to the disposition of Liggett’s remaining claims. If Liggett prevailed at trial on those counts, and upon Sunas’ subsequent appeal this Court held ownership of the process to be a jury question, Sunas would thereby likely be awarded a new trial on all (6) six of Liggett’s claims. Requiring such adjudication of the same claims in two separate trials would result in needless expense to the parties as well as to our court system. Upon the circumstances presented, we conclude the grant of summary judgment on Liggett’s first claim is immediately appealable as affecting a substantial right. Roberts v. Heffner, 51 N.C. App. 646, 650, 277 S.E.2d 446, 449 (1981). Without deciding whether a substantial right is affected, we also elect to review the trial court’s dismissal of Sunas’ counterclaims. This Court is free to exercise its discretion and rule on an interlocutory appeal where our decision would expedite the administration of justice. Green v. Duke Power, 305 N.C. at 608, 290 S.E.2d at 596. II. Turning to the substantive issues raised by this appeal, we first examine whether the trial court erred in granting summary judgment on Liggett’s first claim. Summary judgment for Liggett was proper only if the pleadings and evidence before the trial court demonstrated there existed no genuine material issue of fact and that Liggett was entitled to judgment regarding ownership of the quick-aging process as a matter of law. N.C.R. Civ. P. 56(c) (1990); Roumillat v. Simplistic Enterprises, Inc., 331 N.C. 57, 62, 414 S.E.2d 339, 341-42 (1992). The burden of establishing a lack of any triable issue of fact resides with Liggett as movant and thus all evidence must be viewed in the light most favorable to Sunas. Roumillat, 331 N.C. at 62-63, 414 S.E.2d at 342. Liggett urges us to affirm the trial court, contending it correctly determined as a matter of law Liggett’s right to the patented quick-aging process. We disagree and hold the issue of ownership under the facts of this case should be determined by the trier of fact. The question of who owns patented inventions, employer or employee, is not novel. Although our own appellate courts have not considered this problem frequently, the basic rules governing its resolution are well established. In such controversies, inventor-ship provides the starting point for determining ownership of patent rights. See Ernest B. Lipscomb, Walker on Patents § 3.2 (3d ed. 1984). In the case sub judice, the parties appear to agree Sunas invented the quick-aging process. The preliminary question being thus uncontroverted, the con-. tract of employment between the inventor Sunas and his employer determines their respective rights to Sunas’ invention. United States v. Dubilier Condenser Corp., 289 U.S. 178, 187, 77 L.Ed. 1114, 1118, amended by, 289 U.S. 706, 77 L.Ed. 1462 (1933); Speck v. N.C. Dairy Foundation, Inc., 311 N.C. 679, 686, 319 S.E.2d 139, 143 (1984). The fact of employment, standing alone, does not endow an employer with exclusive ownership rights to an invention, even though the invention may occur during working hours. 30 C.J.S. Employer-Employee § 117, at 185-86 (1992). In Speck, our Supreme Court declared that, absent contrary agreement, the employer owns an invention if: (1) the employee is “hired to invent, accomplish a prescribed result, or aid in the development of products,” or (2) the employee is set to experimenting with the view of making an invention and accepts payment for such work. Speck, 311 N.C. at 686-87, 319 S.E.2d at 143-44. In the case sub judice, as in Speck, there was no written contract detailing Sunas’ duties as an analytic chemist. Furthermore, the affidavits and depositions presented in this case establish Sunas was not originally hired to invent. However, Liggett argues the existence of a company policy constituted an express contract between it and Sunas as part of his oral employment agreement. Liggett points to the provisions contained in an employee handbook and to sworn statements of certain supervisory employees regarding a “longstanding (albeit unwritten) custom and policy that all inventions made in the course of employment were property of the company.” This contention is unavailing for several reasons. First, the record is devoid of any evidence indicating agreement between Sunas and Liggett that the handbook was incorporated into Sunas’ terms of employment. Second, the handbook was first issued in 1976, years after Sunas began his employment, and the contents thereof appear to have been unilaterally implemented by Liggett. Third, this Court in Walker v. Westinghouse Electric Corp., 77 N.C. App. 253, 335 S.E.2d 79 (1985), disc. review denied, 315 N.C. 597, 341 S.E.2d 39 (1986), held “unilaterally promulgated employment manuals or policies do not become part of the employment contract unless expressly included in it.” Id. at 259, 335 S.E.2d at 83-84. Finally, the affidavit of a former employee of the Research Department offered by Sunas contradicts the existence of any policy with regard to assignment of inventions between 1952-1973. Since Sunas was not “hired to invent” and since there exists at best a question of fact as to the existence of an express agreement or policy that Liggett owned any inventions, summary judgment determining the patented quick-aging process belongs to Liggett was appropriate only if the second approach set forth in Speck has application. Under this second approach, “[i]t matters not in what capacity the employee may originally have been hired[;] if he be set to experimenting with the view of making an invention, and accepts pay for such work, . . . what he accomplishes by the experiments belongs to the employer.” Speck, 311 N.C. at 686, 319 S.E.2d at 144 (quoting Houghton v. United States, 23 F.2d 386, 390 (4th Cir. 1928)). Thus, we must initially consider the evidence as to when Sunas was “set to experimenting.” Liggett contends Sunas was directed to experiment with the quick-aging process in September of 1980. This argument is based upon a written memorandum to Liggett’s Vice-President of Research from Sunas dated 30 September 1980 in which Sunas requested to pursue research on “sugar-amino acid reactions” and to “[s]tudy the possibility of upgrading less desirable tobaccos by ‘in situ’ production of their flavorants.” While Liggett’s argument finds support in the evidence, we cannot hold as a matter of law Sunas was set to experimenting on the quick-aging process in 1980. Preliminarily, it is controverted whether Liggett ever responded to Sunas’ September 1980 query. More importantly, the contents of the document itself raise a factual dispute concerning whether it encompassed matters relating to the quick-aging process. The subject is denominated “Improve Aroma & Taste of Our Cigarettes,” and Sunas’ request makes no reference to the quick-aging process. Indeed, the critical terms “rapid,” “accelerated,” “quick,” or “forced aging” are contained nowhere therein. Additionally, according to Sunas’ affidavit introduced at the hearing, the memorandum pertains to matters unrelated to the quick-aging process, i.e., the development of analytical procedures for identification of certain flavor compounds in tobacco used by Liggett at that time. While the effect of the 30 November 1980 memorandum is thus unclear, there appears no disagreement Liggett directed Sunas to experiment with quick-aging of tobacco on 19 February 1981. On that date, Sunas approached his supervisor with the results of his initial quick-aging experiment and was told to continue work on the process. Accordingly, we must examine whether the evidence conclusively shows the quick-aging process was invented after 19 February 1981. If Liggett directed Sunas to develop the quick-aging process
BARNELL v TAUBMAN COMPANY, INC Docket No. 135296. Submitted April 15, 1993, at Lansing. Decided December 20, 1993, at 10:00 A.M. Leave to appeal sought. Charles L. Barnell brought an action in the Oakland Circuit Court against the Taubman Company, Inc., alleging wrongful discharge, age discrimination, and promissory estoppel. Kay Barnell, Charles’ wife, brought a derivative claim of loss of consortium. The plaintiffs alleged that Charles Barnell was recruited by the defendant for a new position of vice president of financial services. They further alleged that during his interviews with the chief financial officer, the chief executive officer, and the chief of operations he was assured that his performance would be reviewed and he would be discharged only for failing to perform adequately. The defendant claimed that Charles Barnell’s employment was at will and that even if he was not aware of that policy at the time of his employment, he was made aware of it a few months later when a memorandum indicating that all employment was at will was circulated to all employees. The defendant further claimed that Charles Barnell had been discharged for cause. The court, Jessica R. Cooper, J., granted summary disposition for the defendant on the basis that there was no issue of material fact. The plaintiffs appealed. The Court of Appeals held: 1. The plaintiffs alleged that the defendant had made a specific promise that plaintiff Charles Barnell would be discharged only for good cause. Their pleadings were sufficient, if believed by a trier of fact, to establish a contractual basis to overcome the presumption that his employment was at will. 2. Because the plaintiffs alleged an express contractual agreement that the employment would be terminated only for good cause, the defendant could not change unilaterally the nature of the employment relationship. Inasmuch as plaintiff Charles did not sign the acknowledgment that accompanied the memorandum that the defendant circulated to its employees relative to the nature of their employment relationship, and there were no other acts of the parties evidencing his assent to a modification of his employment relationship, the memorandum could not modify the alleged express agreement upon which the plaintiffs’ claim of wrongful discharge was based. Accordingly, the trial court erred in granting summary disposition for the defendant with respect to the claim of wrongful discharge on the basis that the plaintiffs failed to allege facts sufficient to raise issues of material fact requiring resolution by a trier of fact. References Am Jur 2d, Master and Servant §§ 20, 32, 43, 46. See ALR Index under Discharge from Employment or Office; Labor and Employment. 3. Although the plaintiffs’ allegations with respect to the claim of age discrimination were sufficient to establish that Charles Barnell was replaced by a younger employee, their allegations failed to rebut the defendant’s allegation that his dismissal was because of a difference in management philosophies. Replacement by a younger person without some evidence that age was a determining factor in the dismissal is insufficient to establish a claim of age discrimination. Because the plaintiffs failed to plead that critical factor, the trial court properly granted summary disposition for the defendant with respect to the claim of age discrimination. 4. Plaintiff Charles Barnell’s leaving his prior position and moving from Grand Rapids to the Detroit area in order to take the job with the defendant was insufficient to establish the element of reliance needed to establish a claim of promissory estoppel. Although the trial court incorrectly stated that summary disposition for the defendant with respect to the claim of promissory estoppel should be granted on the basis that the claim was nothing more than a restatement of the claim of wrongful discharge, the granting of summary disposition was the correct result, albeit for the wrong reason. 5. The issue argued by the defendant relative to mitigation of damages is not properly before the Court of Appeals, no cross appeal having been filed. Affirmed in part, reversed in part, and remanded. Contracts — Employment — Discharge for Good Cause — Express Agreements — Unilateral Modification. An employer that by express agreement promises that an employee will be discharged only for good cause may not convert unilaterally that relationship to employment at will; such a change of the employment relationship requires the assent of the employee. Mary Anne M. Helveston, for the plaintiffs. Miro Miro & Weiner (by Thomas W. Cranmer and Bruce L. Segal), for the defendant. Before: White, P.J., and Cavanagh and Jansen, JJ. Jansen, J. This is a wrongful discharge and age discrimination case. Plaintiffs appeal as of right from an order of the Oakland Circuit Court of November 7, 1990, granting defendant summary disposition pursuant to MCR 2.116(0(10). We affirm in part, reverse in part, and remand for further proceedings. i Charles Barnell (hereinafter plaintiff) was employed by Rapistan, a division of Lear Siegler, Inc., from 1971 until 1985. In January 1984, he became vice president of finance at Rapistan. In the spring of 1985, an employment search agency contacted plaintiff and advised him that defendant Taubman Company was seeking to fill a new position of vice president of financial services. The position was designed to assist Gerald Poissant, defendant’s chief financial officer. Although plaintiff was not looking to change positions, he agreed to meet with Poissant. Plaintiff met with Poissant, and one of plaintiff’s initial inquiries concerned job security. Plaintiff stated that he was concerned about the stability of the Taubman organization and the security of the position of vice president of financial services, because it was a newly created position. Poissant told plaintiff that he need not be concerned with summary dismissal at the Taubman Company, that he would have the same type of job security that he had at Rapistan, that he would not be discharged without cause (although he was not certain of the exact words used. to convey this message), that the Taubman Company had a process of regular reviews, and that defendant had a performance evaluation system. Plaintiff next met with Robert Larson, defendant’s chief executive officer. Plaintiff related some of the same concerns to Larson. Larson assured plaintiff that there was a system for employee evaluation and that such a system would apply to him. Plaintiff last met with Robert Taubman, defendant’s chief of operations. Taubman assured plaintiff that employees were reviewed and only if they were not performing would they be discharged. Plaintiff accepted the position with the Taubman Company in August 1985. Defendant claims that the employment application sets forth the company’s policy that all employment is at will. However, plaintiff asserts that he never received or saw the document, and the document is not signed by plaintiff. Approximately eight months after plaintiff began working with defendant, in March 1986, defendant distributed to all employees, including plaintiff, a memorandum stating that all employment was strictly at will. Plaintiff did not sign the acknowledgment form that accompanied the memorandum, but he does not deny receiving the memorandum. During his tenure with defendant, plaintiff never received a formal evaluation. When he questioned Poissant about this, he was told not to worry and that he would be reviewed the next time. Plaintiff also received a letter from Larson in December 1985 telling him that he had been selected as a key manager to participate in an incentive compensation program, and he received a similar letter and bonus the following year. On February 10, 1987, plaintiffs employment was terminated without prior notice. When plaintiff inquired why, he was told that "things weren’t working out.” There is some indication that an employee whom plaintiff had supervised, Steve Eder, was very unhappy with plaintiff’s presence and was very critical of plaintiff. Apparently, Eder had applied for the same position as plaintiff, but obviously was not chosen for the job. Eder complained to Poissant regarding plaintiffs management style. Defendant claims that plaintiff was terminated primarily because of a difference in management philosophies. Several months after plaintiffs termination, defendant hired Cathleen Knight, a thirty-year-old, to assist Poissant in some of his duties. Plaintiff concedes that his actual position was not filled but that his responsibilities were reorganized. Plaintiff filed his cause of action alleging wrongful discharge, age discrimination, and promissory estoppel. Plaintiffs wife, Kay Barnell, filed a claim of loss of consortium, a derivative action. Defendant moved for summary disposition of all claims, arguing that plaintiff had failed to create a material factual dispute. The trial court agreed and granted summary disposition to defendant pursuant to MCR 2.116(0(10). ii A Plaintiff’s first issue on appeal relates to his wrongful discharge claim. Plaintiff argues that the trial court erred in granting summary disposition because there is a material factual dispute regarding the existence of a just-cause contract. A motion for summary disposition pursuant to MCR 2.116(C) (10) may be granted when, except with regard to the amount of damages, there is no genuine issue concerning any material fact and the moving party is entitled to judgment as a matter of law. Such a motion tests the factual basis of the claim. A court reviewing the motion must consider the pleadings, affidavits, depositions, admissions, and any other documentary evidence. Radtke v Everett, 442 Mich 368, 374; 501 NW2d 155 (1993). The party opposing the motion has the burden of showing that a genuine issue of material fact exists. Giving the benefit of reasonable doubt to the nonmovant, the trial court determines whether a record might be developed that would leave open an issue upon which reasonable minds might differ. The court may not make factual findings or weigh credibility in deciding a motion for summary disposition. Featherly v Teledyne Industries, Inc, 194 Mich App 352, 357; 486 NW2d 361 (1992). This Court examines the facts of this case in a light most favorable to plaintiff. Radtke, supra. Accordingly, our review of a motion for summary disposition is de novo. B We must first determine whether the oral assurances given to plaintiff are sufficient to create an employment contract terminable only for just cause. Employment contracts for an indefinite duration are presumptively terminable at the will of either party. Lynas v Maxwell Farms, 279 Mich 684, 687; 273 NW 315 (1937). To overcome the presumption of employment at will, a party must present sufficient proof either of a contractual provision for employment for a definite term or of a provision forbidding discharge in the absence of just cause. Rowe v Montgomery Ward & Co, Inc, 437 Mich 627, 636; 473 NW2d 268 (1991). There are two alternative theories that may support a claim of wrongful discharge. The first theory is grounded in contract principles. The contract theory is shown by the existence of an express agreement, oral or written. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 598; 292 NW2d 880 (1980). The second theory is termed the legitimate expectations theory and is based on the employee’s legitimate expectations of continued employment absent just cause for termination arising out of the employer’s policies and procedures. Id. In the instant case, we are only concerned with whether plaintiff has proven the existence of an express agreement based mainly on the oral assurances given him during the preemployment stages. In Rowe, supra at 645, our Supreme Court made clear that "oral statements of job security must be clear and unequivocal to overcome the presumption of employment at will.” When analyzing oral statements for contractual implications, the meaning that reasonable persons might have given the language under the circumstances must be determined. Rowe, supra at 640. We believe, on the basis of the factors set forth in Rowe, that plaintiff has alleged sufficient objective evidence to permit a reasonable juror to find that a reasonable promisee would interpret the statements made by Poissant, Larson, and Taubman as a promise of termination only for just cause. Rood v General Dynamics Corp, 444 Mich 107, 119; 507 NW2d 591 (1993). Taken in a light most favorable to plaintiff, the evidence establishes that plaintiff engaged in preemployment negotiations regarding job security. Plaintiff was the vice president of finance at Rapistan before being contacted by an employment search agency. Although he was not looking for a new job, he agreed to meet with Poissant. At the meeting with Poissant, he specifically inquired about job security because the position was new, and he inquired about the stability of the Taubman Company. He made known to Poissant that he did not want to be in an environment of "summary dismissals,” as was the case with some employees at Rapistan, although his employment had not been terminated by Rapistan. Poissant assured plaintiff that the environment was not one where he needed to be concerned with summary dismissal. Poissant assured him that defendant offered the same kind of job security that he had at Rapistan, that he would not be dismissed without cause, and that defendant had a performance evaluation system or regular reviews. Poissant informed plaintiff that the performance evaluation system normally occurred once a year and that employees were rewarded or dismissed on the basis of their performance utilizing that system. Plaintiff expressed his same concerns to Larson, and Larson also assured plaintiff that there was a system of employee evaluation used for everyone in the company. Robert Taubman further assured plaintiff that employees were reviewed and only if they were not performing would they be discharged. Therefore, plaintiff specifically engaged in preemployment negotiations regarding job security and the parties discussed job security in the sense of requiring just cause for plaintiff’s termination. Rowe, supra at 643; Rood, supra at 120. Further, plaintiff was applying for the singular executive position of vice president of financial services. Such a position is similar to that in Toussaint and unlike the "one of many departmental salespersons” as in Rowe. Because plaintiff was leaving a well-paid, executive position at Rapistan, it is reasonable to conclude that job security would be important to him. Also, in the instant case, plaintiff was given few, if any, documents at the preemployment stage. Indeed, the only document referred to by both parties is the employment application form. However, the acknowledgment of his employment being at will is unsigned and plaintiff claims that he never received or saw the document. We find that the oral assurances assertedly made by Poissant, Larson, and Taubman in the preemployment negotiation stage were sufficient to create an express agreement for just-cause employment. Coupled with the fact of the uniqueness of the position and the lack of any handbooks, documents, or other material given to plaintiff suggesting employment at will, we find that plaintiff has alleged sufficient evidence from which reasonable minds could find that a reasonable promisee would interpret the statements as a promise forbidding termination absent just cause. c Having concluded that the oral statements formed an express agreement for just-cause employment, we must next determine if the employer could change unilaterally the nature of the employment relationship with the memorandum sent in March of 1986 providing for employment at will. Plaintiff does not deny receiving the memorandum, but, he did not sign an acknowledgment form. In In re Certified Question, 432 Mich 438, 441; 443 NW2d 112 (1989), our Supreme Court held that a company’s written policy statements, which created legitimate expectations in the employee that he would be discharged for just cause only, could be unilaterally modified provided that the employer gives the affected employees reasonable notice of the policy change. However, the instant case is not premised on the legitimate expectations theory of creation of an employment contract providing for discharge for cause only. Rather, this case involves an express agreement that discharge will be only for cause. In Rowe, supra at 650-651, the Supreme Court found the fact that the plaintiff did not sign the disclaimers that employment was at will to be not determinative, because the plaintiff did not have an express contract providing that discharge would be only for cause. The Court made clear that if a plaintiff has a prior express contract providing that discharge will be only for cause, then the plaintiff’s assent is required to modify the agreement. Rowe, supra at 651. Therefore, the fact that plaintiff did not sign the acknowledgment form in this case is determinative. By not signing the acknowledgment form, plaintiff evidenced an intent not to assent to the modification of the express agreement that discharge would be only for cause. Further, there are no other acts of the parties, including written and spoken words, that indicate that plaintiff assented to modify the express agreement. Farrell v Automobile Club of Michigan (On Remand), 187 Mich App 220, 228; 466 NW2d 298 (1991); Scholz v Montgomery Ward & Co, Inc, 437 Mich 83, 90-93; 468 NW2d 845 (1991). Accordingly, we hold that the trial court erred in granting defendant summary disposition with regard to the wrongful discharge claim. Plaintiff has alleged sufficient facts to give rise to a question for a trier of fact whether there was an express agreement that his employment would be terminated only for just cause. Further, because plaintiff did not assent to the modification of the express contract, the memorandum providing that all employment was at will did not change the nature of the employment contract. iii Plaintiff next argues that the trial court erred in granting summary disposition with regard to his age discrimination claim. Plaintiff’s claim of age discrimination is premised on the provisions of the Civil Rights Act, which prohibits discrimination on the basis of age. MCL 37.2202(1)(a); MSA 3.548(202)(1)(a). The burden of proof in an age discrimination case is allocated as follows: (1) the plaintiff has the burden of proving by a preponderance of the evidence a prima facie case of discrimination; (2) if the plaintiff is successful in proving a prima facie case, the burden shifts to the defendant to articulate a legitimate, nondiscriminatory reason for its actions; and (3) the plaintiff then has the burden of proving by a preponderance of the evidence that the legitimate reason offered by the defendant was merely a pretext. Featherly, supra at 358. A prima facie case of age discrimination can be made by proving either intentional discrimination or disparate treatment. Wolff v Automobile Club of Michigan, 194 Mich App 6, 11; 486 NW2d 75 (1992). To establish a prima facie case of age discrimination under the intentional discrimination theory, plaintiff must show that (1) he was a member of a protected class, (2) he was discharged, (3) he was qualified for the position, and (4) he was replaced by a younger person. Matras v Amoco Oil Co, 424 Mich 675, 683; 385 NW2d 586 (1986). In proving disparate treatment, plaintiff must show that he was a member of a protected class and that he was treated differently than persons of a different class for the same or similar conduct. Wolff, supra at 11. Age need not be the only reason or main reason for discharge, but it must be one of the reasons that made a difference in determining whether to discharge a person. Therefore, the question is whether age
ROOD v GENERAL DYNAMIC CORPORATION SCHIPPERS v SPX CORPORATION Docket Nos. 93416, 93968. Argued April 1, 1993 (Calendar Nos. 10-11). Decided September 21, 1993. Rehearings denied post, 1203. Richard A. Rood, M.D., brought an action in the Macomb Circuit Court against the General Dynamics Corporation, alleging wrongful discharge in breach of a just-cause contract. The court, Robert J. Chrzanowski, J., granted summary judgment for the defendant. The Court of Appeals, Cynar and Brennan, JJ. (Danhof, C.J., dissenting), reversed in an unpublished opinion per curiam (Docket No. 117470). In lieu of granting leave to appeal, the Supreme Court remanded the case to the Court of Appeals for reconsideration in light of Rowe v Montgomery Ward & Co, Inc, 437 Mich 627 (1991). After remand, the Court of Appeals, Danhof, C.J., and Griffin, J. (Brennan, J., dissenting), reversed its original decision in an unpublished opinion per curiam (Docket No. 145598). The plaintiff appeals. Joseph Schippers brought an action in the Muskegon Circuit Court against the SPX Corporation, alleging wrongful discharge in breach of a just-cause contract. The court, Michael E. Kobza, J., granted summary judgment for the defendant. The Court of Appeals, Neff, P.J., and Maher and Murphy, JJ., reversed (Docket No. 117549). The Supreme Court, in lieu of granting leave to appeal, remanded the case to the Court of Appeals for reconsideration in light of Rowe. After remand, the Court of Appeals, Neff, P.J., and Michael J. Kelly and Reilly, JJ., reaffirmed its original holding (Docket No. 147499). The defendant appeals. In an opinion by Chief Justice Cavanagh, joined by Justices Brickley, Boyle, Riley, Griffin, and Mallett, the Supreme Court held: A claim for wrongful discharge may be supported by contract or public policy. In these cases, while there was insufficient . evidence under the contract theory to overcome the presumption of employment at will, in Rood, the employer’s written policies and procedures were sufficiently clear and definite to create a question for the jury regarding the existence of a just-cause employment relationship. References Am Jur 2d, Master and Servant §§ 27, 45. See ALR Index under Labor and Employment. 1. Employment contracts of indefinite duration are presumed to be terminable by either party for any or no reason. To overcome the presumption, sufficient proof either of a provision for a definite term of employment or one forbidding discharge except for just cause must be shown. Express or implied promises or employer policies and procedures that instill legitimate expectations of just-cause employment may be sufficient and may become legally enforceable parts of an employment relationship. 2. Oral statements of just-cause employment must be clear and unequivocal, and the circumstances surrounding them must objectively show that a reasonable person would have interpreted them to provide a just-cause relationship. In these cases, viewing the evidence in a light most favorable to the plaintiffs, there is no evidence from which a reasonable juror could infer that the employers intended to provide just-cause employment. 3. Where a legitimate expectations theory is asserted, the trial court should examine the employer’s policy statements concerning employee discharge to determine whether they are capable of reasonably being interpreted differently, and thus questions for the jury. In Schippers, the statements were insufficient. In Rood, the policies and procedures could have instilled a legitimate expectation of just-cause employment, requiring reversal and remand for further proceedings. Rood, reversed and remanded. Schippers, reversed. Justice Levin, concurring in part and dissenting in part, stated that the evidence presented by the plaintiffs is sufficient to create a question of material fact whether oral assurances, written company policies, and company procedures and practices gave rise to a contract of just-cause employment under Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 479 (1980). It cannot properly be said that all reasonable persons would agree that no such contract was created between the parties. 194 Mich App 52; 486 NW2d 89 (1992) reversed. Master and Servant — Termination for Cause — Oral Promises. Express or implied promises or employer policies and procedures that instill legitimate expectations of just-cause employment may be sufficient and may become legally enforceable parts of an employment relationship; oral statements of just-cause employment must be clear and unequivocal, and the circumstances surrounding them must objectively show that a reasonable person would have interpreted them to provide a just-cause relationship. Sachs, Waldman, O’Hare, Helveston, Hodges & Barnes, P.C. (by Mary Katherine Norton), for the plaintiff in Rood. McCroskey, Feldman, Cochrane & Brock, P.C. (by John P. Halloran), for the plaintiff in Schipppers. Butzel, Long, P.C. (by John P. Hancock, Jr., Barbara T. Pichan, and Susan A. Hartmus), for the defendant in Rood. Culver, Lague & McNally (by Kevin B. Even) for the defendant in Schippers. Amicus Curiae: Mark Granzotto, Monica Farris Linkner, and Charles P. Burbach, for Michigan Trial Lawyers Association. Clark, Klein & Beaumont (by Dwight H. Vincent, J. Walker Henry, Rachelle G. Silberberg, and Patricia Bordman) for Michigan Manufacturers Association. Stark & Gordon (by Sheldon J. Stark, Martha I. Seijas) for National Lawyers Guild, Edgar Jerome Dew for National Conference of Black Lawyers, Reginald M. Turner, Jr., for Wolverine Bar Association, Paul J. Denenfeld for American Civil Liberties Union, and Charlene M. Snow for Women Lawyers Association of Michigan. Vamum, Riddering, Schmidt & Howlett (by Joseph J. Vogan) for Michigan Chamber of Commerce and The Employers’ Association. Cavanagh, C.J. In these wrongful discharge actions, we are asked to examine employer oral representations and written policy statements to determine the existence of alleged employment agreements terminable only for cause. In Rood, we find that the employer’s written policy statements were sufficiently clear and definite to create a jury question, regarding the existence of a just-cause employment relationship. In Schippers, however, we cannot so find. Consequently, we reverse the judgments of the different panels of the Court of Appeals. i A. SCHIPPERS v SPX CORP For fourteen years, plaintiff Joseph Schippers was employed as an "over-the-road” truck driver by defendant SPX Corporation. For approximately 12V2 of those years, Mr. Schippers was employed at the SPX-Sealed Power Division. In August 1986, Mr. Schippers transferred from Sealed Power to another division within spx, the Hy-Lift Division, which had only one truck and one driver, Mr. Schippers. Spx leased its trucks, including the truck driven by Mr. Schippers, from defendant Ryder Truck Rental. As part of the lease agreement between spx and Ryder, spx agreed to operate the trucks in a safe and careful manner. On January 28, 1987, Ryder’s district controller, Peter Stanley, sent a letter to Hy-Lift’s production control manager, Larry Bozik, informing him that Mr. Schippers had been involved in three accidents and that Ryder was placing Mr. Schippers on probation. Hy-Lift’s employee relations manager, Patrick E. Goresch challenged the basis for Ryder’s decision and requested proof to establish its claim. Ryder never sent the requested information and nothing further occurred until August 1987. On August 6, 1987, approximately one year after his transfer to Hy-Lift, Mr. Schippers was involved in a traffic accident. While Mr. Schippers claims that the accident was caused by a "steering malfunction,” an investigation conducted by Ryder indicated that the accident occurred because Mr. Schippers fell asleep at the wheel. In any event, Ryder notified spx that, pursuant to the lease agreement, it was requesting that Mr. Schip-pers not be permitted to operate any of its vehicles. Ryder further warned spx that if it allowed Mr. Schippers to operate any of its vehicles, then spx would be in breach of contract and liable for all personal injury and property damage resulting from any accident involving Mr. Schippers after the date of the letter. Following receipt of this letter, spx initiated its own investigation. The investigation revealed that this was not Mr. Schippers’ first accident; it was only "one of many which occurred while Schippers was a truck driver for spx.” On the basis of the investigation, an spx risk-management employee, James Sheridan, determined that of all spx truck drivers employed, Schippers presented the greatest risk to the enterprise. Mr. Schippers was terminated on September 4, 1987. He commenced this action against spx in Muskegon Circuit Court, on June 15, 1988, claiming that his discharge violated his employment agreement, which provided for discharge only for cause and negligent evaluation. The trial court granted spx’s motion for summary judgment on both counts, but the Court of Appeals reversed. 186 Mich App 595; 465 NW2d 34 (1990). Spx filed an application for leave to appeal in this Court, which, in lieu of granting leave, remanded to the Court of Appeals for reconsideration in light of Rowe v Montgomery Ward & Co, Inc, 437 Mich 627; 473 NW2d 268 (1991). 439 Mich 895 (1991). On remand, the Court of Appeals reaffirmed its original holding. 194 Mich App 52; 486 NW2d 89 (1992). We subsequently granted spx’s application for leave to appeal, 441 Mich 881 (1992), and we reverse. B. ROOD V GENERAL DYNAMICS CORP The plaintiff, Dr. Richard Rood, began working for Chrysler Corporation at its Hamtramck plant in 1968 as a per diem plant physician. In 1970, he converted to a salaried employee at the urging of his supervisor, Dr. George Olson. Dr. Rood’s employment responsibilities included the performance of physicals for newly hired workers and workers returning to work, and workers’ compensation evaluations. He also was responsible for providing general medical care for plant employees. In 1972, Dr. Rood was promoted to senior plant physician at the Hamtramck plant. This position required the supervision of other doctors and nurses. He performed this function until Chrysler closed its Hamtramck plant in 1980 and transferred Dr. Rood to the Detroit tank plant, where he assumed the role of plant physician, working under the direct supervision of the personnel manager, Owsley Spiller. Chrysler sold the Detroit tank plant in March 1982 to the defendant, General Dynamics Land Systems (gdls), which retained the entire plant medical department, including Dr. Rood as plant physician. As a result, Dr. Rood continued to report to Mr. Spiller, and his duties remained essentially the same. Gdls had three plants in separate states and each plant had its own plant physician who reported to nonmedical personnel. The new vice president of human resources, Donald Norman, testified that he desired to create a more efficient means of handling the various medical facilities at the three plants. As a result, he established the position of division medical director to oversee all the division’s medical personnel, and only that person reported to Mr. Norman. When filling this new position, Mr. Norman bypassed Dr. Rood and hired another doctor, Dr. Charles R. Harper, who had an extensive background as a medical director in other corporations. Gdls contends that, after hiring Dr. Harper, an economic concern developed. At the time of his termination, Dr. Rood’s annual salary was $59,000 and Dr. Harper’s starting salary was $70,000. According to Mr. Norman, it was not economically feasible for gdls to have both a full-time plant physician and a division medical director. He, therefore, purportedly decided that the division medical director would perform both the division-wide responsibilities as well as the duties of the plant physician at the Detroit plant and Dr. Rood’s position was eliminated. Dr. Rood challenges the reasons for his dismissal, however, claiming that the hiring of Dr. Harper was solely to replace him. In any event, in December 1984, the then-director of personnel relations, William Pagen, informed Dr. Rood that gdls "had decided to replace” him and that he could either submit a letter of resignation or be fired. Dr. Rood submitted his letter of resignation that became effective on January 4, 1985. Dr. Rood filed this action in Macomb Circuit Court on December 29, 1987, claiming that his discharge violated his employment agreement, negligent evaluation, and breach of the covenant of good faith and fair dealing. On gdls’ motion, the circuit court dismissed plaintiff’s negligent evaluation and breach of good-faith and fair-dealing claims for failure to state a claim on which relief can be granted. MCR 2.116(C)(8). Because Dr. Rood did not appeal this determination, the case proceeded through discovery on only the breach of implied contract claim. Following discovery, gdls filed a motion for summary judgment, which the trial court granted. Dr. Rood appealed in the Court of Appeals, which reversed in a split decision. Unpublished opinion per curiam, decided December 27, 1990 (Docket No. 117470). Gdls filed an application for leave to appeal in this Court, which, in lieu of granting leave, remanded to the Court of Appeals for reconsideration in light of Rowe. 439 Mich 851 (1991). On remand, the Court of Appeals, in yet another split decision, reversed its original holding. Unpublished opinion per curiam, decided February 19, 1992 (Docket No. 145598). We subsequently granted Dr. Rood’s application for leave to appeal, 441 Mich 880 (1992), and we reverse. ii Employment contracts for an indefinite duration are presumptively terminable at the will of either party for any reason or for no reason at all. Lynas v Maxwell Farms, 279 Mich 684, 687; 273 NW 315 (1937). This presumption is not, however, "a substantive limitation on the enforceability of employment contracts but merely a rule of 'construction.’ ” Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 597; 292 NW2d 880 (1980). "The presumption does not prevent proof of actual intent and should not be employed to permit unjustified evasions of promissory liability.” Rowe at 676, n 14 (Boyle, J., concurring). To overcome the presumption of employment at will, a party must present sufficient proof either of a contractual provision for a definite term of employment or a provision forbidding discharge absent just cause. Rowe at 636-637. Such provisions may become part of an employment contract as a result of "explicit” promises, Perritt, Employee Dismissal Law & Practice (2d ed), § 4.1, p 173, or promises implied in fact. Rowe at 668 (Boyle, J., concurring). As recognized in Toussaint, however, employer policies and procedures may also become a legally enforceable part of an employment relationship if such policies and procedures instill "legitimate expectations” of job security in employees. Toussaint at 615. In other words, there are two alternative theories of enforceability that may support a claim of wrongful discharge in Michigan. While the first theory is grounded solely on contract principles "relative to the employment setting,” Rowe at 632, the second theory is grounded solely on public policy considerations. As Justice Boyle noted in her concurring opinion in In re Certified Question (Bankey v Storer Broadcasting Co), 432 Mich 438, 458; 443 NW2d 112 (1989), "the pure legitimate expectations leg of Toussaint was founded on the Court’s common-law authority to recognize” enforceable obligations that arise " 'outside the operation of normal contract principles.’ ” a. "contract theory” of toussaint 1. APPLICABLE LAW Contractual liability is consensual. 1 Farns-worth, Contracts, § 3.1, p 160. A basic requirement of contract formation is that the parties mutually assent to be bound. Id. In Rowe, this Court recognized "the difficulty in verifying oral promises,” Rowe at 641, especially in the employment relations context, because individuals often harbor "optimistic hope of a long relationship” that causes them to misinterpret their employer’s oral statements as manifestations of an intention to undertake a commitment in the form of a promise of job security. Rowe at 640. Accordingly, and in an effort to recognize oral contracts for job security only where the circumstances suggest both parties intended to be bound, id. at 636, the Rowe Court held that "oral statements of job security must be clear and unequivocal to overcome the presumption of employment at will.” Id. at 645. In deciding whether a party has assented to a contract, we follow the objective theory of assent, focusing on how a reasonable person in the position of the promisee would have interpreted the promisor’s statements or conduct. Calamari & Per-illo, Contracts (3d ed), §2-2, p 27. As Professor Farnsworth stated: Since it is difficult for a workable system of contract law to take account of assent unless, there has been an overt expression of it, courts have required that assent to the formation of a contract be manifested in some way, by words or other conduct, if it is to be effective. [Id. at § 3.1, pp 160-161.] Otherwise stated, to determine whether there was mutual assent to a contract, "we use an objective test, 'looking to the expressed words of the parties and their visible acts,’ ” Rowe at 640, quoting Goldman v Century Ins Co, 354 Mich 528, 535; 93 NW2d 240 (1958), and ask whether a reasonable person could have interpreted the words or conduct in the manner that is alleged. Thus, we begin our analysis by looking "to all the relevant circumstances surrounding the transaction, including all writings, oral statements, and other conduct by which the parties manifested their intent.” Rowe at 641. (A) SCHIPPERS (i) EVIDENCE Viewed in a light most favorable to Mr. Schip-pers, the relevant evidence is as follows: Mr. Schip-pers was employed at Sealed Power for approximately 12V2 years before transferring to Hy-Lift. Before Mr. Schippers transferred to that division, Hy-Lift did not have a truck or a driver and relied totally on Sealed Power for its transportation needs. In an effort to save money and to gain additional control over its transportation needs, Hy-Lift decided to lease a truck from Ryder and approached Mr. Schippers about his willingness to transfer from Sealed Power to Hy-Lift. Although Hy-Lift had its choice of Sealed Power drivers, it wanted Mr. Schippers because he had driven for Hy-Lift, knew the routes, and was considered the most reliable. Mr. Schippers was one of seven drivers at Sealed Power, and he was second in seniority. Consequently, before deciding to make the switch to Hy-Lift, Mr. Schippers "consulted” with three of Hy-Lift supervisors, including his immediate supervisor, Mr. Bozik, and the general manager of Hy-Lift, Mr. Overway, about "job security.” During these conversations, Roy Overway told him that "as far as he was concerned, unless something was really wrong, [Mr. Schippers] would be there for retirement”' and that "Mr. Bosik [sic] went so far as to make the comment that as long as [Hy-Lift] had a truck, [he] would be the driver.” Moreover, Mr. Schippers states that he was given "similar” assurances from another "management person” at Hy-Lift, Perry Abbes, although he was unable to recall his exact words. At the time of transfer, spx had issued an employee "Information Handbook.” On page one, the handbook provides:_ We are proud of our people and recognize their value through steady employment, fair wages, good working conditions, unusually broad benefit programs, and recognition as individuals. Sealed Power has adopted overall policies of employment and standards of conduct which are fair to all employees and in the best interest of the company. These policies and standards spell out your responsibilities to the company and the company’s responsibility and obligati
GIBRALTAR SCHOOL DISTRICT v GIBRALTAR MESPA-TRANSPORTATION Docket No. 92723. Argued January 12, 1993 (Calendar No. 7). Decided August 20, 1993. The Michigan Education Support Personnel Association, which had been newly certified to represent transportation and custodial and maintenance employees of the Gibraltar School District, filed unfair labor practice charges against the district, claiming that its refusal to arbitrate grievances under previous, expired contracts while the parties negotiated successor agreements, were unilateral actions without notice and were effected in contravention of its statutory duty under the public employment relations act to bargain in good faith with respect to wages, hours, and other terms and conditions of employment. A hearing referee dismissed the charges, finding that the association had no standing to file the charges because the previous contracts had expired before the association was certified as the employees’ bargaining representative, and that no present or past contractual obligation was owed by the district to arbitrate the grievances. The Michigan Employment Relations Commission affirmed. The Court of Appeals, Wahls, P.J., and Doctoroff and G. S. Allen, Jr., JJ., affirmed in an unpublished opinion per curiam, finding that the expired agreements had never been extended formally by the parties and that the school district had no contractual obligation with the newly certified union to submit the grievances to arbitration (Docket No. 116964). The association appeals. In an opinion by Justice Boyle, joined by Justices Brickley, Riley, and Griffin, the Supreme Court held: The public employment relations act does not create a statutory duty to arbitrate grievances arising after the expiration of a collective bargaining agreement, and the grievances in this case did not accrue or vest under the previous collective bargaining agreement. References Am Jur 2d, Labor and Labor Relations §§ 1773, 1787, 1790, 1838, 1842, 1844. See ALR Index under Arbitration and Award; Labor and Employment; Public Officers and Employees. 1. Grievances that arise after certification of a new union depend for resolution on the pera, not the expired collective bargaining agreement. Thus, the mespa had standing to assert a statutory violation and file an unfair labor practice charge. However, under the pera, there is no statutory duty to arbitrate after expiration of a collective bargaining agreement. 2. Any rights to arbitrate under the arbitration clause of an otherwise expired agreement are those that the parties intended should last beyond the expiration date or that accrue or vest during the term of the agreement. In this case, there was no showing that the parties intended arbitration to survive beyond its expiration date, and it was not argued that the grievances had accrued or vested. Affirmed. Chief Justice Cavanagh, joined by Justices Levin and Mallett, concurring in part and dissenting in part, stated that a contractual provision for arbitration survives the expiration of a collective bargaining agreement as a term and condition of employment under the pera. The pera compels a public employer to bargain collectively with its employees’ representatives in good faith with respect to mandatory subjects of bargaining. Neither party may take unilateral action regarding a mandatory subject absent impasse. In this case, there was no impasse at the time the district extinguished the arbitration procedure, a mandatory subject of bargaining. The employees’ status as public employees compels rejection of federal precedent interpreting the nlra and its effect on private employees. Because the district unilaterally changed the arbitration process before reaching an impasse in negotiations with the newly certified union, it violated the pera. 1. Labor Relations — Arbitration — Public Employment Relations Act — Collective Bargaining — Expired Contracts. The public employment relations act does not create a statutory duty to arbitrate grievances arising after the expiration of a collective bargaining agreement. 2. Labor Relations — Arbitration — Collective Bargaining — Expired Contracts. Any rights to arbitrate under the arbitration clause of an otherwise expired agreement are those that the parties intended should last beyond the expiration date or that accrue or vest during the term of the agreement. Cox & Hodgman (by Jamil Akhtar) for the plaintiff. Amberg, McNenly, Zuschlag, Firestone & Lee, P.C. (by Steven J. Amberg and Joseph H. Firestone), for the defendants. Boyle, J. The question presented is whether an arbitration clause of a collective bargaining agreement survives the expiration date of the collective bargaining agreement which created it. We are persuaded by the strong precedent favoring arbitration as being consensual that an agreement to arbitrate does not survive expiration of a collective bargaining contract statutorily as a term or condition of employment under the public employment relations act. The obligation to arbitrate grievances postcontract encompasses grievances involving employee rights that accrue or vest under the contract, or situations in which the parties expressly provided for arbitration beyond the term of the agreement. We affirm the decision of the Court of Appeals. I The Gibraltar school transportation employees, as well as its custodial and maintenance employees, were previously represented in bargaining with the school district by the American Federation of State, County and Municipal Employees. Each unit’s contract contained a four-step grievance procedure with arbitration as the final step to resolve "[a]ny grievance or dispute which may arise between the parties concerning the application, meaning or interpretation” of the agreement. Although each contract contained a broad automatic renewal clause, neither included any specific language providing for survival of arbitration in the event the entire contract expired. The transportation unit’s contract expired on June 30, 1984, and the custodial and maintenance unit’s contract terminated on June 30, 1985. Although the record is void of any evidence that the contracts were renewed by virtue of the contracts’ automatic renewal provisions, we make the logical inference that they were not, in light of the subsequent election and certification of a new bargaining agent for both labor units. The Michigan Education Support Personnel Association (mespa) petitioned the Michigan Employment Relations Commission for recognition as the exclusive bargaining agent for both labor units. The mespa prevailed over the afscme in an August 26, 1985, consent election and was certified as the sole bargaining representative by the merc on September 9, 1985. Negotiations for new contracts between the school district and the mespa began the following day. According to the union’s representative, the school district’s representative verbally assured them that they would "extend the contracts,” despite the fact that both parties acknowledged that the afscme contracts had expired and both units were currently working without contracts. On October 18, 1985, the school district offered the mespa a written contract that included a four-step grievance procedure with arbitration as the final step. The provision was conditioned on the union’s agreement to a no-strike clause. At that time, the school district proposed an interim grievance procedure that did not contain arbitration. After the mespa objected to the interim plan, the school district withdrew its proposal and indicated it would adhere to the grievance procedure established under the expired afscme contract, with the exception of arbitration as a final step. The parties continued to negotiate without reaching impasse on any subject of bargaining. Ultimately, agree-merits for both units were reached and the contracts ratified by the Gibraltar School Board on October 14, 1986. Meanwhile, the mespa filed several grievances with the school district during the period between October 24, 1985, and February 3, 1986. Citing the provisions of the expired afscme contract, the grievances alleged violations concerning bus run assignments, payment for runs, working hours, payment for layover time, schedule changes, outside employees performing bargaining unit work, and the assignment of a bargaining unit position. Unable to achieve resolution after processing* the grievances through the initial three steps of the afscme procedure, the union filed a demand for arbitration with the American Arbitration Association, claiming a right to arbitration, pursuant to the expired afscme contract. The school district refused the demands for arbitration, stating that no current labor contract existed between the parties granting the association or any third party the authority to process such demands. It also complained that the written arbitration provisions attached to the union’s arbitration demands were excerpts from the expired afscme contract to which the mespa was not a party. Arbitration of the grievances was stayed pending resolution of the issue of the right to arbitration itself. On February 20 and May 13, 1986, the mespa filed unfair labor practice charges against the school district pursuant to § 10 of the public employment relations act, 1965 PA 379, as amended, MCL 423.210; MSA 17.455(10). Specifically, the union claimed that the parties, by agreement, had been working under the last "mutually agreed to collective bargaining agreement, dated February 9, 1982, while the parties engage[d] in negotiations for a successor agreement.” The mespa charged that the school district’s refusal to arbitrate grievances were unilateral actions "without notice and were effectuated in contravention of its statutory duty under the pera to bargain in good faith with Charging Party with respect to wages, hours and other terms and conditions of employment and constitute^] a continuing effort by [the Gibraltar School District] to undermine the status of [the mespa] as bargaining representative for the employees represented by [the mespa].” The charges were consolidated and a hearing conducted before a hearing referee who found that the mespa had no standing to file the charges. He rejected the mespa’s theory that the employer repudiated its contractual obligation to arbitrate, because, by its own terms, the contract had expired before the union was certified as the employees’ bargaining representative. Finding no present or past contractual obligation to be owed by the school district to arbitrate the grievances at issue, the hearing referee dismissed the charges. The merc upheld the hearing referee’s findings and dismissal order. The mespa appealed as of right in the Court of Appeals, which affirmed in an unpublished per curiam opinion, decided October .17, 1991 (Docket No. 116964). The Court found that the expired agreements were never formally extended by the parties and that the school district had no contractual obligation with the newly certified union to submit the grievances to arbitration. We granted leave to appeal. 440 Mich 889 (1992). II A Before turning to the central issue in this case, we deal briefly with the contention that the mespa lacked standing to enforce the arbitration provisions of the expired contract. We conclude that such a contention is inappropriate for the issue of the statutory obligation to arbitrate. In this context, "standing” refers to the authority of a newly certified union to litigate rights originally acquired by the predecessor union, usually under a collective bargaining agreement or because of actions or omissions relating to the predecessor union’s status as collective bargaining representative of the unit. In this case, the charging parties were certified after the expiration of the collective bargaining agreements. During this period, the terms and conditions of employment are continued because of the statutory obligation to bargain, Detroit Police Officers Ass’n v Detroit, 391 Mich 44, 54-55; 214 NW2d 803 (1974). Grievances that arise after certification of the new union depend on the statutory obligation, not the expired collective bargaining agreement. Any question concerning the authority of the newly certified union to enforce rights granted by the expired agreement is irrelevant. Thus, we reject the claim that the mespa does not have standing to claim a statutory violation and file an unfair labor practice charge. B The central question posed is the extent to which an arbitration clause of a collective bargaining agreement survives the expiration date of a collective bargaining agreement. This issue was recently addressed by the United States Supreme Court in the context of private sector disputes under the National Labor Relations Act, 29 USC 151 et seq.; Litton Financial Printing Div v NLRB, 501 US 190; 111 S Ct 2215; 115 L Ed 2d 177 (1991). We have long recognized that Michigan’s public employment relations act, MCL 423.201 et seq.; MSA 17.455(1) et seq., is modeled on the nlra. Although not controlling, we look to federal precedent developed under the nlra for guidance in our interpretation of the pera, Central Michigan Univ Faculty Ass’n v Central Michigan Univ, 404 Mich 268; 273 NW2d 21 (1978); Pontiac Police Officers Ass’n v Pontiac (After Remand), 397 Mich 674; 246 NW2d 831 (1976); Detroit Police Officers Ass’n v Detroit, supra at 53. Thus, Litton is an appropriate place to begin our inquiry. In Litton, the expired collective bargaining agreement contained a two-step grievance procedure with arbitration as the final step. During the hiatus between contracts, and without consulting the union, the employer eliminated a portion of its operations and laid off workers. The union demanded grievance procedures and arbitration concerning the layoffs pursuant to the terms of its prior contract with the employer. The employer refused to process or arbitrate the grievances. The nlrb upheld the union’s charge of an unfair labor practice and ordered grievance procedures and arbitration. The Supreme Court granted the employer’s petition limited to the issue of the right to arbitration postcontract. Justice Kennedy’s opinion for the Court differentiates two sources for imposing an obligation on an employer to arbitrate a dispute arising after the expiration date of one collective bargaining agreement but before the effective date of any successor agreement. These sources might be called the statutory obligation and the contract obligation. The statutory obligation is found in §§ 8(a)(5) and 8(d) of the nlra, 29 USC 158(a)(5) and (d), which require an employer to bargain "in good faith with respect to wages, hours, and other terms and conditions of employment.” As the Court stated in Litton: The [nlrb] has determined, with our acceptance, that an employer commits an unfair labor practice if, without bargaining to impasse, it effects a unilateral change of an existing term or condition of employment. See NLRB v Katz, 369 US 736; 82 S Ct 1107; 8 L Ed 2d 230 (1962). In Katz the union was newly certified and the parties had yet to reach an initial agreement. The Katz doctrine has been extended as well to cases where, as here, an existing agreement has expired and negotiations on a new one have yet to be completed. See, e.g., Laborers Health and Welfare Trust Fund v Advanced Lightweight Concrete Co, 484 US 539, 544, n 6; 108 S Ct 830; 98 L Ed 2d 936 (1988). [Litton, 111 S Ct 2221.] Among the mandatory subjects of bargaining is grievance resolution, including arbitration, United States Gypsum Co v Int’l Woodworkers of America, CIO, 94 NLRB 112, 131 (1951). While the nlrb has ruled that most mandatory subjects of bargaining are within the Katz rule, it has created several exceptions, among which is grievance arbitration, Hilton-Davis Chemical Co v Int’l Chemical Workers Union, 185 NLRB 241 (1970). The United States Supreme Court, with significant deference to the nlrb’s interpretation of the nlra, likewise extended by this Court to the merc, summarized and quoted from Hilton-Davis as follows: [T]he Board determined that arbitration clauses are excluded from the prohibition on unilateral changes, reasoning that the commitment to arbitrate is a "voluntary surrender of the right of final decision which Congress . . . reserved to the parties. . . . [Arbitration is, at bottom, a consensual surrender of the economic power which the parties are otherwise free to utilize.” [Hilton-Davis] at 242. The Board further relied upon our statements acknowledging the basic federal labor law policy that "arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.” United Steelworkers of America v Warrior & Gulf Navigation Co, 363 US 574, 582; 80 S Ct 1347; 4 L Ed 2d 1409 (1960). See also 29 USC 173(d) (phrased in terms of parties’ agreed upon method of dispute resolution under an existing bargaining agreement.) [Litton, 111 S Ct 2222.] A unanimous court in Litton agreed that there is no statutory right to arbitration under the nlra and refused the invitation to reject the nlrb’s decision, relying almost totally on the consensual nature of arbitration: We think the Board’s decision in Hilton-Davis Chemical Co, is both rational and consistent with the Act. The rule is grounded in the strong statutory principle, found in both the language of the nlra and its drafting history, of consensual rather than compulsory arbitration. See Indiana & Michigan [Electric Co v Local Union No 1392, Int’l Brotherhood of Electrical Workers, 284 NLRB 53, 57-58 (1987)]; Hilton-Davis Chemical Co, supra. The rule conforms with our statement that "[n]o obligation to arbitrate a labor dispute arises solely by operation of law. The law compels a party to submit his grievance to arbitration only if he has contracted to do so.” Gateway Coal Co v Mine Workers, 414 US 368, 374; 94 S Ct 629; 38 L Ed 2d 583 (1974). We reaffirm today that under the nlra arbitration is a matter of consent, and that it will not be imposed upon parties beyond the scope of their agreement. In the absence of a binding method for resolution of postexpiration disputes, a party may be relegated to filing unfair labor practice charges with the Board if it believes that its counterpart has implemented a unilateral change in violation of the nlra. If, as the Union urges, parties who favor labor arbitration during the term of a contract also desire it to resolve postexpiration disputes, the parties can consent to that arrangement by explicit agreement. Further, a collective-bargaining agreement might be drafted so as to eliminate any hiatus between expiration of the old and execution of the new agreement, or to remain in effect until the parties bargain to impasse. Unlike the Union’s suggestion that we impose arbitration of postexpiration disputes upon parties once they agree to arbitrate disputes arising under a contract, these alternatives would reinforce that statutory policy that arbitration is not compulsory. [Litton, 111 S Ct 2222-2223.] Federal authority is not the only source of guidance on this question. We have the benefit of the decision of the merc in this case, which was decided before the Supreme Court issued its opinion in Litton. The merc was forced to use the principles announced in Nolde Bros, Inc v Local 358, Bakery & Confectionery Workers Union, AFL-CIO, 430 US 243; 97 S Ct 1067; 51 L Ed 2d 300 (1977), the lead case on contract obligation post collective bargaining agreement, as well as nlrb authority implementing Nolde Bros, and our decision in Ottawa Co v Jaklinski, 423 Mich 1; 377 NW2d 668. (1985), which also drew on Nolde Bros. However, the merc, as a matter of interpreting the pera, reached a conclusion that matches Litton’s interpretation of the nlra. Citing with approval Indiana & Michigan, supra, an nlrb decision applying Nolde Bros, the merc stated, "[A]n
WILLIAM DWIGHT BOESCHE, Plaintiff v. RALEIGH-DURHAM AIRPORT AUTHORITY, et al., Defendants No. 9215SC23 (Filed 20 July 1993) 1. Labor and Employment § 66 (NCI4th); Constitutional Law § 85 (NCI4th) — employer’s drug testing policy — plaintiff in position to affect public safety or safety of others — constitutional policy The drug testing policy implemented by defendant airport authority was constitutional where plaintiff was authorized to drive a vehicle on the apron of the flight area of Raleigh-Durham airport; he was in a position in which public safety or the safety of others was an overriding concern; and there thus existed a legitimate reason for the implementation of a drug testing program. Am Jur 2d, Constitutional Law §§ 557-573; Master and Servant §§ 49-59. 2. Labor and Employment § 63 (NCI4th)— wrongful discharge — bad faith exception not recognized North Carolina does not recognize an independent tort claim for wrongful discharge under the bad faith exception. Am Jur 2d, Master and Servant §§ 27-33. 3. Labor and Employment § 66 (NCI4th); Constitutional Law § 85 (NCI4th)— random drug testing — testing procedure constitutional — no testing performed on plaintiff — dismissal of constitutional claims proper The trial court properly dismissed plaintiffs constitutional claims against defendant airport authority’s random drug testing procedure policy that afforded plaintiff no prior notice of testing or test procedure, that included no guarantee of confidentiality of test results or immunity from criminal prosecution in the case of a positive result, and that led to plaintiffs termination with no opportunity for a hearing before an impartial tribunal, since (1) defendant’s random drug testing procedure was constitutional, and (2) plaintiff never participated in the testing procedure which effectively precluded any possible constitutional violation. Am Jur 2d, Constitutional Law §§ 557-573; Master and Servant §§ 49-59. * Appeal by plaintiff from order entered 4 November 1991 by Judge Robert H. Hobgood in Orange County Superior Court. Heard in the Court of Appeals 9 December 1992. Loftin and Loftin, by John D. Loftin, for plaintiff-appellant. Walter H. Bennett, Jr. for plaintiff-appellant. Newsom, Graham, Hedrick, Bryson & Kennon, by Lewis A. Cheek, Richard S. Boulden and John R. Long, for defendants-appellees. JOHNSON, Judge. Plaintiff, William D. Boesche, was employed by the defendant, Raleigh-Durham Airport Authority, as a Maintenance Mechanic II on or about 30 August 1987. Plaintiffs employment duties generally consisted of performing preventative maintenance and repairs on airport terminal air conditioning and ventilating and heating systems. Throughout his employment tenure, plaintiff had performed his job duties competently and satisfactorily. Based on this satisfactory performance, plaintiff had received two merit pay raises. On 21 February 1990, plaintiff was approached by defendant’s Airport Maintenance Manager, Mr. Owens, who asked plaintiff to accompany him to Park Medical Center in Wake County to submit to a urine drug test. Mr. Owens did not express that plaintiff was suspected of any individualized wrongdoing. Plaintiff refused to submit to the test. Plaintiff demanded to see defendant Airport Personnel Manager Farrar-Luten who told plaintiff that the new proposed testing policy was implemented pursuant to a Federal Aviation Administration directive requiring that all employees who drive a motor vehicle in the airside of the airport must be tested. Plaintiff asked to see the directive, but Farrar-Luten refused to show him the directive. Plaintiff then saw defendant Airport Director Brantley who told plaintiff that plaintiff must submit to a drug test because that was the airport’s policy. Upon plaintiff’s refusal to submit to the drug test, he was discharged. On 26 April 1991, plaintiff filed a complaint in this action alleging the aforesaid facts and claiming that the actions of the defendants violated his rights to be free from illegal searches and invasion of privacy under the Fourth Amendment to the United States Constitution and Article I, Sections 20, 35 and 36 of the North Carolina Constitution; his rights to due process of law under the Fifth and Fourteenth Amendments to the United States Constitution and Article I, Sections 1, 19, 35 and 36 of the North Carolina Constitution; his right not to be discharged from employment in bad faith or for reasons contravening public policy under the common law of North Carolina; and for the common law tort of intentional/negligent infliction of emotional distress. Defendants moved to dismiss the complaint as amended under Rule 12(b)(6) of the North Carolina Rules of Civil Procedure on the grounds that it failed to state a claim upon which relief could be granted. On 4 November 1991, the motion to dismiss was granted in its entirety. Plaintiff appealed. By plaintiff’s first assignment of error, plaintiff contends that the trial court committed reversible error by dismissing plaintiffs claim for wrongful discharge of a public employee under the public policy and bad faith exceptions to the employment at will doctrine, where plaintiff was discharged for his refusal to waive his rights to due process of law, privacy, and freedom from unreasonable search and seizure of his person by submitting to an unconstitutional drug test. We disagree. On review of a motion to dismiss for failure to state a claim upon which relief can be granted, Rule 12(b)(6) of the North Carolina Rules of Civil Procedure, all allegations of fact are taken as true but conclusions of law are not. Sutton v. Duke, 277 N.C. 94, 176 S.E.2d 161 (1970). The trial court’s dismissal of plaintiff’s complaint under Rule 12(b)(6) is proper and must be sustained when (1) the complaint on its face reveals that no law supports plaintiff’s claim; (2) the complaint on its face reveals the absence of fact sufficient to make a good claim; and (3) some facts disclosed in the complaint necessarily defeat the plaintiff’s claim. Jackson v. Bumgardner, 318 N.C. 172, 347 S.E.2d 743 (1986). With this in mind, we now address plaintiff’s claim that by his discharge, defendants violated North Carolina public policy. Generally, North Carolina adheres to the employment-at-will doctrine which holds that absent a contract of employment for a definite term, the employee-employer relationship can be terminated by either party at any time for any reason or no reason. Salt v. Applied Analytical, Inc., 104 N.C. App. 652, 655, 412 S.E.2d 97, 99 (1991); Burgess v. Your House of Raleigh, 326 N.C. 205, 209, 388 S.E.2d 134, 137 (1990); Still v. Lance, 279 N.C. 254, 259, 182 S.E.2d 403, 406 (1971). There have been several exceptions carved out of the employment-at-will rule. The legislature has enacted certain statutory exceptions that place certain limitations on this rule, i.e., prohibiting discharge in retaliation for filing a workers’ compensation claim, North Carolina General Statutes § 97-6.1 (1983); prohibiting discharge for engaging in labor disputes, North Carolina General Statutes § 95-83 (1985); and prohibiting discharge for filing Occupational Safety and Health Act claims, North Carolina General Statutes § 95-130(8) (1985). North Carolina Courts have also placed some limitations on the doctrine by the creation of two public policy exceptions. The first public policy exception was created in Sides v. Duke University, 74 N.C. App. 331, 328 S.E.2d 818, disc. review denied, 314 N.C. 331, 334 S.E.2d 13 (1985). In Sides, the Court was reviewing the dismissal of plaintiff’s complaint for failure to state a claim upon which relief could be granted. The plaintiff in Sides alleged that she was discharged for her refusal to testify untruthfully or incompletely in a court action against her employer. In determining that the plaintiff’s complaint stated a cause of action under a public policy exception, the Sides Court stated: [W]hile there may be a right to terminate a contract at will for no reason, or for an arbitrary or irrational reason, there can be no right to terminate such a contract for an unlawful reason or purpose that contravenes public policy. A different interpretation would encourage and sanction lawlessness, which law by its very nature is designed to discourage and prevent. Id. at 342, 328 S.E.2d at 826. A second public policy exception was created in Coman v. Thomas Manufacturing Co., 325 N.C. 172, 381 S.E.2d 445 (1989). In Coman, an employee was discharged for refusing to violate government highway safety rules. The Coman Court held that the defendant’s discharge of plaintiff was in violation of the public policy of North Carolina. Although these two cases seem to have expanded the employment-at-will doctrine, subsequent case law has made it very clear that the decisions in Sides and Coman have only narrowly eroded the employment-at-will doctrine. Burgess, 326 N.C. at 209-10, 388 S.E.2d at 137. Plaintiff in the case sub judice, argues that this Court should create a third public policy exception based on an employee’s exercise of his legal rights and privileges. Plaintiff acknowledges his employment-at-will status but argues that this should not require him to waive his basic constitutional right. Plaintiff further argues that he was terminated when he asserted his basic Fourth Amendment right to be free from unreasonable searches and seizure, invasion of privacy and deprivation of due process. In order to determine whether a third public policy exception should be adopted, we must first determine whether defendant’s random drug testing program was unconstitutional. The Fourth Amendment of the United States Constitution provides that “[t]he right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violatedf.]” The essential purpose of the Fourth Amendment is to “impose a standard of ‘reasonableness’ upon the exercise of discretion by government officials ... in order to safeguard the privacy and security of individuals against arbitrary invasions by governmental officials.” Delaware v. Prouse, 440 U.S. 648, 653-54, 59 L.Ed.2d 660, 667 (1979); Camara v. Municipal Court, 387 U.S. 523, 528, 18 L.Ed.2d 930, 935 (1967). Courts have clearly established that individuals retain an expectation of privacy and a right to be free from government intrusion in the integrity of their own bodies. United States v. Ramsey, 431 U.S. 606, 52 L.Ed.2d 617 (1977). With this premise in mind, Courts have determined that governmental taking of a urine specimen constitutes a search and seizure within the meaning of the Fourth Amendment. Skinner v. Railway, 489 U.S. 602, 103 L.Ed.2d 639 (1989); National Treasury Employees Union v. Von Raab, 816 F.2d 170 (1987). The Supreme Court, however, established that random drug testing of urine in the workplace can be constitutional if the reasonableness of the search is judged by balancing its intrusion on the individual’s Fourth Amendment interests against the promotion of legitimate governmental interests. Skinner, 489 U.S. 602, 103 L.Ed.2d 639. In Skinner, the Court allowed random drug testing where the individual tested was engaged in activity which involved either public safety or safety concerns for others because it was a legitimate governmental interest. Id. The Court in Twigg v. Hercules Corp., 185 W.Va. 155, 406 S.E.2d 52 (1990) stated: Where a business is engaged in an activity which involves either public safety or safety concerns for others, we find that there exists a legitimate reason for the implementation of a drug testing program[.] . . . However, there must be a showing by the employer that the employees required to undergo such testing have responsibilities or duties which are connected to the safety concerns of others. Twigg, 185 W.Va. at 159, 406 S.E.2d at 56. Applying this standard to the facts in the case sub judice, the record showed that plaintiff was in a position in which public safety or the safety of others was an overriding concern. Plaintiffs duties consisted of generally performing preventative maintenance and repairs on airport terminal air conditioning and ventilating and heating systems, but plaintiff also had security clearance to drive a motor vehicle 10 M.P.H. in a designated area on the apron of the flight area in order to get access to the systems located on the outside of the building. We find that plaintiff, if drug impaired while operating a motor vehicle on the apron of the flight area, could increase the risk of harm to others. Accordingly, we find that the drug testing policy implemented by defendants was constitutional and therefore, plaintiff does not state a cognizable claim for relief. Plaintiff next argues that the trial court committed reversible error when it held that plaintiff failed to state a cognizable claim under the bad faith exception to the employment-at-will doctrine. This argument is meritless. The Court in Coman, 325 N.C. 172, 381 S.E.2d 445, noted that North Carolina had not recognized a bad faith exception to the employment-at-will doctrine but stated that other courts in other states “have recognized wrongful discharge theories characterized either as the bad faith exception to the at-will doctrine or under the implied covenant of good faith and fair dealing.” Id. at 177, 381 S.E.2d at 448 (citations omitted). In addition, the Coman Court stated that “[b]ad faith conduct should not be tolerated in employment relations, just as it is not accepted in other commercial relationships.” Coman, 325 N.C. at 177, 381 S.E.2d at 448. However, the statements addressing a bad faith exception were not relied upon in Coman's ultimate holding that plaintiff had stated a valid claim for wrongful discharge based on the public policy exception to the employment-at-will doctrine. Most Courts interpreting Coman have recognized that the discussion in Coman of a bad faith discharge was dicta, but have come to different conclusions. English v. Gen. Elec. Co., 765 F. Supp. 293 (E.D.N.C. 1991) (disallowing tort claim for bad faith exception); Haburjak v. Prudential Bache Sec., Inc., 759 F. Supp. 293 (W.D.N.C. 1991) (disallowing tort claim for bad faith exception); Iturbe v. Wandel & Goltermann, Technologies, Inc., 774 F. Supp. 959 (M.D.N.C. 1991) (allowing claim for bad faith discharge). However, two recent cases, Salt, 104 N.C. App. 652, 412 S.E.2d 97 and Amos v. Oakdale Knitting Co., 331 N.C. 348, 416 S.E.2d 166 (1992), have clarified North Carolina’s position on the issue of a bad faith exception. The Salt Court and the Amos Court both held that North Carolina does not recognize an independent tort claim for wrongful discharge under the bad faith exception. We therefore find plaintiff has not stated a cognizable claim. By plaintiff’s second assignment of error, plaintiff contends that he is not subject to random drug testing because he is neither (1) a sensitive public employee because of either safety or security reasons or (2) an individual suspected of drug use. A discussion of this assignment of error was encompassed in the first argument where we determined that plaintiff was indeed a sensitive public employee because of safety concerns. As such, plaintiff is subject to random drug testing as a legitimate governmental interest. We do not deem it necessary to further address this issue. By plaintiff’s third assignment of error, plaintiff contends that the trial court committed reversible error in dismissing plaintiff’s constitutional claims against defendant’s random drug testing procedure policy that afforded plaintiff no prior notice of testing or test procedure, that included no guarantee of confidentiality of test results or immunity from criminal prosecution in the case of a positive result, and that led to plaintiff’s termination with no opportunity for a hearing before an impartial tribunal. We disagree. After a careful review of the record, we find no violation of plaintiff’s constitutional rights. The arguments raised in this assignment of error are moot in that (1) we found that the defendants’ random drug testing procedure was constitutional and (2) plaintiff never participated in the testing procedure which effectively precluded any possible constitutional violation. As such, plaintiff has failed to raise a cognizable claim. This assignment of error is overruled. By plaintiff’s fourth assignment of error, plaintiff contends that the trial court committed reversible error when it dismissed plaintiff’s claims in his complaint which were based upon defendants’ denial of plaintiff’s right of substantive due process rights. We disagree. “An employment discharge violates substantive due process rights if it is based upon constitutionally impermissible grounds, regardless of whether the employee had a property interest in continued employment.” Privette v. University of North Carolina, 96 N.C. App. 124, 135, 385 S.E.2d 185, 190 (1989). Plaintiff alleged that his substantive due process rights were violated because he was forced to elect between exercise of a constitutional right and the privilege of government employment. As we have made an earlier determination that plaintiff’s constitutional rights were not violated, we find no violation of substantive due process rights. In plaintiff’s fifth assignment of error he argues that the trial court committed reversible error when it dismissed plaintiff’s claims in his complaint which were based upon defendants’ denial of plaintiff’s right to procedural due process. In order to sufficiently state a claim of denial of due process rights, plaintiff must reveal “a colorable claim that a ‘property’ or ‘liberty’ interest was violated by the procedures attendant to plaintiff’s discharge.” Presnell v. Pell, 298 N.C. 715, 723, 260 S.E.2d 611, 616 (1979). In the present case, there has been no dispute and the record clearly reveals that plaintiff is an employee-at-will. “At-will employees have no property interests in their employment cognizable under the due process clause.” Privette, 96 N.C. App. at 137, 385 S.E.2d at 192. This assignment of error is overruled. We have carefully reviewed assignments of error seven and eight and find them to be meritless. The trial court’s decision is affirmed. Chief Judge ARNOLD and Judge ORR concur.
GTE Products Corporation vs. Jefferson Davis Stewart, Third. Essex. December 10, 1992. April 6, 1993. Present: Abrams, Lynch, O’Connor, & Greaney, JJ. Injunction. Practice, Civil, Discovery, Preliminary injunction. In litigation between an attorney and a corporation that formerly had employed him as its in-house counsel, the record supported the judge’s denial of preliminary injunctive relief that would have required the attorney to return to the corporation certain documents containing confidential information, where the corporation made no showing of irreparable harm, other than its claim that possession of the documents might give the attorney an advantage in the litigation, and where the judge granted an injunction prohibiting the attorney from disclosing the information contained in the documents. [724-726] Civil action commenced in the Superior Court Department on October 16, 1991. A motion for preliminary injunctive relief was heard by John T. Ronan, J. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Arthur G. Telegen (Nina Joan Kimball with him) for the plaintiff. Earle C. Cooley (Paul F. Beckwith with him) for the defendant. Abrams, J. GTE Products Corporation (GTE) commenced this action against Jefferson Davis Stewart, III, its former in-house counsel, seeking preliminary and permanent injunctive relief, as well as damages. GTE claimed that (1) Stewart violated the attorney-client privilege, his ethical obligations as a member of the Kentucky bar, and the disciplinary rules of this court by disclosing certain documents to his own attorney; and (2) by removing or not returning the documents, Stewart unlawfully converted them to his own use. Stewart counterclaimed against GTE, alleging (1) wrongful discharge; (2) breach of the implied covenant of good faith and fair dealing; (3) conspiracy to commit wrongful discharge; and (4) intentional infliction of emotional distress. A Superior Court judge, after hearing, declined to issue a preliminary injunction ordering the return of the documents but did enter an order prohibiting Stewart from any further disclosure. Pursuant to G. L. c. 231, § 118, second par. (1990 ed.), GTE appeals from the portion of the interlocutory order in which the judge declined to order Stewart to return the documents. We transferred this case on our own motion. We affirm. Standard of review. In reviewing a denial of a request for a preliminary injunction, we determine whether the judge abused his discretion. Packaging Indus. Group, Inc. v. Cheney, 380 Mass. 609, 615 (1980). “[Wjhile weight will be accorded to the exercise of discretion by the judge below, if the order was predicated solely on documentary evidence we may draw our own conclusions from the record.” Id. at 616. The judge heard argument but did not take any evidence. We therefore review the record to determine whether it “supports the judge’s resolution of the factual questions before him.” Id. at 622. Standard for preliminary injunction. “[W]hen asked to grant a preliminary injunction, the judge initially evaluates in combination the moving party’s claim of injury and chance of success on the merits. If the judge is convinced that failure to issue the injunction would subject the moving party to a substantial risk of irreparable harm, the judge must then balance this risk against any similar risk of irreparabie harm which granting the injunction would create for the opposing party. . . . Only where the balance between these risks cuts in favor of the moving party may a preliminary injunction properly issue.” (Footnote omitted.) Packaging Indus. Group, Inc. v. Cheney, supra at 617. “In an appropriate case, the risk of harm to the public interest also may be considered.” Brookline v. Goldstein, 388 Mass. 443, 447 (1983). We summarize the facts. GTE Service Corporation, an affiliate of the plaintiff, employed Stewart as in-house counsel. At some point in August, 1991, Stewart’s employment at GTE terminated. Stewart retained an attorney who wrote to GTE informing it of Stewart’s claim of wrongful discharge. Through this letter, GTE became aware that Stewart had various documents. GTE brought suit to recover these documents and Stewart counterclaimed for wrongful discharge. At GTE’s request, the action has proceeded under seal. In his order on GTE’s motion for a preliminary injunction, the judge determined that “it appears that . . . upon leaving his employment Stewart took with him certain documents containing privileged and confidential information.” In his order, the judge noted that there was “a serious dispute factually as to whether Stewart voluntarily and unilaterally severed his employment or whether he was effectively pushed out the door as too confrontational, unsuited for advancement and terminated in retaliation for his strong stand on issues of public safety regarding plaintiff’s products.” The judge declined to order the return of the documents. He did, however, issue “an interlocutory order - prohibiting the defendant Stewart, his agents, servants and any person acting in concert with Stewart from any further disclosure of any, every, and all communications [,] documents, materials, that has occurred between plaintiff corporation and the defendant employee-attorney Stewart [see note 2, supra] which arose out of the employment relationship which had to do with the defendant rendering legal services, advices, or opinions.” Harm to the plaintiff. GTE claims that denial of so much of the request for a preliminary injunction as would have ordered Stewart to return the privileged documents causes irreparable harm to the confidence and trust GTE has placed in its in-house counsel. GTE cites various cases where courts issued injunctions prohibiting lawyers from disclosing confidential information. This is precisely what the judge ordered in this case. A plaintiff experiences irreparable injury if there is no adequate remedy at final judgment. See Leubsdorf, The Standard for Preliminary Injunctions, 91 Harv. L. Rev. 525, 551 (1978). In determining the harm to the plaintiff, the court need consider only the harm that would not be redressed by final relief. Id. at 541. In awarding preliminary injunctive relief, a court is justified in requiring the plaintiff to bear a slightly heavier burden, given the problems of enforcing injunctions. See id. at 547. The judge prohibited any further disclosure of the documents, thereby eliminating any chance of harm to GTE from public disclosure. GTE has not shown that allowing Stewart simply to retain the documents until either the hearing on the merits or a pretrial motion challenging the use of any document or requesting that a deposition not take place would create any irreparable harm. GTE’s main claim is that allowing Stewart to retain the documents gives Stewart a litigational advantage that a suppression order would not cure. GTE states that, even if the judge refused to admit the documents as evidence, it has been injured because Stewart’s attorneys in the wrongful discharge case may use the privileged communications to identify witnesses to depose and to learn additional facts about the case. GTE does not cite any cases supporting this proposition. The inference drawn from GTE’s claim is that it has a right to a long and expensive discovery procedure and that allowing Stewart to bypass that process gives him a litigational advantage. “The conduct and scope of discovery is within the sound discretion of the judge.” Solimene v. B. Grauel & Co., KG, 399 Mass. 790, 799 (1987). We reject the claim that there is a right to compel long and expensive discovery and that loss of that litigational advantage is an irreparable injury. The purposes for which the discovery rules exist “are to avoid surprise and the possible miscarriage of justice, to disclose fully the nature and scope of the controversy, to narrow, simplify, and frame the issues involved, and to enable a party to obtain the information needed to prepare for trial. In this way it was sought to put an end to the ‘sporting theory of justice,’ by which the result depends on the fortuitous availability of evidence or the skill and strategy of counsel.” (Footnote omitted.) 8 C.A. Wright & A.R. Miller, Federal Practice & Procedure § 2001, at 17-19 (1970). Stewart has an interest in a full hearing and in the “freedom to act in ways not yet shown to be unlawful.” Laycock, The Death of the Irreparable Injury Rule, 103 Harv. L. Rev. 688, 732 (1990). GTE, as “the moving party [,] must show that, without the requested relief, it may suffer a loss of rights that cannot be vindicated should it prevail after a full hearing on the merits.” Packaging Indus. Group, Inc. v. Cheney, supra at 616. We do not perceive a litigational advantage that the judge could not cure through judicial control of discovery. We reject the inference in GTE’s brief that it will suffer irreparable harm because it cannot control and delay discovery. GTE did not carry its burden of showing it would suffer an irreparable harm absent an injunction requiring Stewart to return the documents. Therefore there was no error in not ordering the defendant to return documents to the plaintiff. Order affirmed. In its notice of appeal, GTE also suggested it was appealing from the judge’s ruling to the extent it did not prohibit Stewart from disclosing further documents to his attorneys. Because GTE has not argued this issue on appeal, it is deemed waived. See Mass. R. A. P. 16 (a) (4), as amended, 367 Mass. 921 (1975); Walsh v. Chestnut Hill Bank & Trust Co., ante 283, 285 n.2 (1993). The defendant appears to raise a factual dispute as to whether he had an attorney-client relationship with the plaintiff itself. The judge assumed that there was such a relationship and, on appeal, we also make that assumption. At oral argument, Stewart represented that he kept copies of all his files at home and that his superiors knew it. In his answer to GTE’s complaint, he admitted retaining documents, but denied that his possession of the documents was actionable. We accept the judge’s findings for the purposes of this review, although we do not decide whether every document reproduced in the record is privileged or contains privileged information. For example, GTE cites an unreported Connecticut Superior Court case dealing with the question of irreparable harm. International Business Mach. Corp. vs. Murray, Conn. Super. Ct., CV 90-0107445 (June 29, 1990). In that case, the plaintiff (IBM) claimed that “there would be severe damage to the proper functioning of the company if its executives believe that there is no confidentiality between themselves and IBM lawyers.” Murray wished to disseminate various documents to area newspapers, and in fact previously had done so in violation of a temporary restraining order. In finding Murray in contempt, the judge agreed that “disclosure constitutes irreparable harm.” We need not decide whether we would be guided by a Connecticut lower court’s ruling because the case is inapposite. The judge issued an order prohibiting disclosure other than to Stewart’s attorneys. GTE has not argued on appeal that Stewart should not be able to disclose to his attorneys. See note 1, supra. Counsel for Stewart has not challenged the breadth of the judge’s order. This is particularly true where, as here, there is a factual dispute as to whether the documents were retained by Stewart with the knowledge and consent of his superiors or were converted wrongfully. In Packaging Indus. Group, Inc. v. Cheney, supra at 616 n.10, we noted: “The risk that a party will suffer irreparable harm during the time between the hearing on the preliminary injunction and final adjudication on the merits may be minimized by consolidating the trial on the merits with the preliminary hearing.” On the record before us, GTE did not request such consolidation. Because we conclude that the plaintiff has failed to show irreparable harm, we do not consider or address any other issues raised.
BRADLEY v PHILIP MORRIS, INC (ON REMAND) Docket No. 155142, 155143. Submitted August 12, 1992, at Lansing. Decided April 5, 1993, at 10:40 a.m. Leave to appeal sought. Ronald Bradley and Cynthia Carsley, former employees of Philip Morris, Inc., brought a wrongful-discharge action in the Oakland Circuit Court against Philip Morris and two of its supervisors, alleging that employment had been terminated in violation of agreements providing for termination only for just cause and that the supervisors had tortiously interfered with the plaintiffs’ contractual relationship with Philip Morris. A jury awarded damages to the plaintiffs. The court, Jessica R. Cooper, J., which earlier had denied directed verdicts for the defendants, denied their motion for judgment notwithstanding the verdicts. The Court of Appeals, Jansen, P.J., and Sullivan and Weaver, JJ., reversed and remanded for a new trial against Philip Morris only, holding that the trial court had abused its discretion in excluding certain evidence of prior misconduct by the plaintiffs and that the claim against the supervisors of tortious interference with a contractual relationship was precluded because they had acted solely as agents of Philip Morris. 194 Mich App 44 (1992). The Supreme Court denied the plaintiffs leave to appeal and, in lieu of granting the defendants leave to cross appeal, remanded the case to the Court of Appeals for consideration of whether the trial court had erred in denying Philip Morris’ motions for a directed verdict and judgment notwithstanding the verdict. 440 Mich 870 (1992). On remand, the Court of Appeals held: The trial court correctly denied Philip Morris’ motions. Where, as in this case, an employer establishes written policies and procedures for the discharge of employees, but does not expressly retain the right to terminate them at will, the existence of a contract providing for just-cause termination is a question of fact properly decided by the jury. Reversed and remanded for a new trial. Sachs, Waldman, O’Hare, Helveston, Hodges & Barnes, P.C. (by Kathleen L. Bogas and Barbara M. Robinson), for the plaintiffs. Miller, Canñeld, Paddock & Stone (by W. Mack Faison, Gerald E. Rosen, Diane Soubly, and Claudia Roberts Ellmann), for the defendants. ON REMAND Before: Jansen, P.J., and Sullivan and Weaver, JJ. Sullivan, J. In a prior per curiam opinion, we reversed a jury verdict in this matter and ordered a new trial. 194 Mich App 44; 486 NW2d 48 (1991). The Supreme Court denied the plaintiffs’ application for leave to appeal; in lieu of granting leave on the defendants’ cross appeal, the Court vacated in part the judgment of this Court. On remand, this Court is ordered to consider defendants’ argument that they should have been awarded a directed verdict or a judgment notwithstanding the verdict on the plaintiffs’ causes of action. 440 Mich 870 (1992). We now consider the defendants’ contention and again remand for a new trial. We repeat, in part, the facts from the prior opinion: The termination of plaintiffs’ employment arose out of events that allegedly occurred on a Detroit Grand Prix weekend in a hotel room paid for by Philip Morris. Philip Morris arranged to have hotel rooms available in the Westin Hotel for its employees and for the purpose of entertaining clients. Plaintiff Ronald Bradley and defendants Graham and Hopkins all were supervisors in Philip Morris’ Farmington Hills office. On the evening in question, two secretaries who worked in the Farmington Hills office — plaintiff Cynthia Carsley and Gina Stauch — met other Philip Morris employees in the Renaissance Center for drinks. Bradley, Carsley, and Stauch ended up in Bradley’s hotel room, which was paid for by Philip Morris. Briefly put, Stauch alleged that she fell asleep in a chair in the room, and when she awoke a few hours later, Bradley and Carsley were having sexual intercourse in the bed located a few feet away. Out of concern over what would happen if they knew she had seen them, Stauch ignored the situation. Eventually, however, Stauch’s allegations were made known to Graham and Hopkins. Stauch’s work performance and attitude had allegedly declined and she no longer respected Bradley or Carsley. Graham testified that he believed Bradley was favoring Carsley by not assigning her work when she did not appear to be busy. Although Bradley and Carsley testified that they did not have sexual intercourse on the night in question, they were both fired for misconduct — offensive action to another employee. [194 Mich App 46-47.] Defendants argue that plaintiffs were in fact at-will employees subject to discharge at any time and that plaintiffs therefore could not establish subjectively or objectively that their contracts of employment were terminable for just cause only. Therefore, the defendants argue that the trial court should have entered a directed verdict of no cause of action or a judgment notwithstanding the verdict. The primary purpose of the Supreme Court’s remand was to consider this question. Snell v UACC Midwest, Inc, 194 Mich App 511, 512; 487 NW2d 772 (1992), states: Oral contracts of employment for an indefinite term are presumed to be terminable at the will of either party. This presumption can be overcome, however, by the existence of an express agreement to the contrary, or by the employee’s legitimate expectations of continued employment absent "just cause” for termination arising from the employer’s established policies and procedures. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980). To infer that an employment contract provides for termination only for just cause, the employee must have an objective expectation of continued employment, not merely a subjective one. Grow v General Product, Inc, 184 Mich App 379, 382-384; 457 NW2d 167 (1990). Wilson v General Motors Corp, 183 Mich App 21, 36; 454 NW2d 405 (1990), stated the well-recognized rule that a motion for judgment notwithstanding the verdict shall be granted only where the evidence presented is insufficient to create an issue for the jury. In deciding a motion for a directed verdict, the evidence and all reasonable inferences are to be viewed most favorably to the nonmoving party. Shipman v Fontaine Truck Equipment Co, 184 Mich App 706, 711; 459 NW2d 30 (1990). Where, as here, the employer has not expressly and unambiguously reserved the right to terminate its employees at will, a question of fact is created that must be decided by a jury. Particularly significant is the fact that four of the defendants’ current and former employees testified at trial that Philip Morris has a policy of just-cause employment, and not an at-will employment policy. Significant, too, is the document entitled "ddd (Discipline Documentation and Discharge),” which states: "Philip Morris does not use the employment at-will doctrine in making employment decisions.” The Michigan Supreme Court has previously ruled that where an employer establishes written policies and procedures by which to discharge employees but does not expressly retain the right to terminate employees at will, the existence of a just-cause contract is a question of fact for the jury. Renny v Port Huron Hosp, 427 Mich 415, 417-418; 398 NW2d 327 (1986). We therefore again remand the matter to the trial court for a new trial.
STOPCZYNSKI v FORD MOTOR COMPANY Docket No. 132931. Submitted December 9, 1992, at Detroit. Decided March 24, 1993; approved for publication June 17, 1993, at 9:10 a.m. Edward Stopczynski brought an action in the Macomb Circuit Court against Ford Motor Company, alleging, in part, wrongful discharge in violation of an alleged contract of employment prohibiting his discharge absent just cause. The court, George R. Deneweth, J., granted summary disposition for the defendant. The plaintiff appealed. The Court of Appeals held: 1. The provisions of the employment agreement were fully disclosed, and the express terms of the contract negate the plaintiff’s claim that a just-cause contract based on oral representations exists. By signing the contract, the plaintiff assented to employment at will, and he may not maintain an action based on alleged prior oral assurances. 2. The defendant’s adoption of disciplinary guidelines did not transform the at-will employment relationship into one prohibiting discharge absent just cause. 3. The defendant complied with the disciplinary procedures outlined in its employee manual before it terminated the plaintiff. The award of summary disposition was proper. 4. The trial court properly found that damages for intentional infliction of emotional distress are not recoverable in an action for breach of an employment contract. In addition, the conduct alleged to have occurred is not so outrageous that it goes beyond all possible bounds of decency. Affirmed. 1. Contracts — Rescission — Failure to Read. A person who signs a contract cannot seek to avoid it on the bases of not having read the contract or of having supposed that it was different in its terms. References Am Jur 2d, Contracts §§ 185, 539, 546; Fright, Shock, and Mental Anguish § 34. See ALR Index under Contracts; Emotional Injury. 2. Master and Servant — Employment at Will — Disciplinary Policies. An employer’s adoption of a disciplinary policy in an employee manual by itself does not transform an at-will employment relationship into one prohibiting discharge absent just cause. 3. Master and Servant — Intentional Infliction of Emotional Distress — Damages — Breach of Employment Contract. Damages for intentional infliction of emotional distress are not recoverable in an action for breach of an employment contract. Roberta Kyselka Sarkis, for the plaintiff. James C. Curtiss and John M. Thomas, Office of the General Counsel, Ford Motor Company, for the defendant. Before: Cavanagh, P.J., and Mackenzie and Griffin, JJ. Per Curiam. This is a wrongful discharge case. Plaintiff alleges that he was fired from his job with defendant in violation of an alleged contract of employment prohibiting his discharge absent just cause. The circuit court entered summary disposition in favor of defendant pursuant to MCR 2.116(0(10), and plaintiff now appeals as of right. We affirm. Plaintiff worked for defendant for twenty-three years before he was fired in March of 1988. Plaintiff began working for defendant in 1965 in an hourly and union-represented position. In 1968, plaintiff was offered a transfer to a salaried position as a nonunion supervisor. Before accepting the transfer, plaintiff inquired whether he would be afforded the same job protection that he had received in his union position. Plaintiff claims that defendant promised him that he would receive the same type of protection and that he could only be discharged for just cause and only after progressive disciplinary measures were followed. However, upon accepting the transfer, plaintiff signed an employment agreement containing the following provisions: I understand that my employment is not for any definite term, and may be terminated at any time, without advance notice, by either myself or Ford Motor Company; that my employment is subject to such rules, regulations, and personnel practices and policies, and changes therein, as Ford Motor Company may from time to time adopt; and that my employment shall be subject to such layoffs, and my compensation to such adjustments, as Ford Motor Company may from time to time determine. I acknowledge that the terms contained herein are the entire terms of my employment agreement, that there are no other arrangements, agreements, or understandings, verbal or in writing, regarding my present or future employment with Ford Motor Company and that any purported arrangements, agreements or understanding made in the future shall not be valid unless evidenced by a writing signed by a properly authorized representative of Ford Motor Company. In granting summary disposition, the circuit court ruled as a matter of law that the contract provided for employment at will. The court further ruled that none of the additional documentation offered by plaintiff was sufficient to create an implied agreement to terminate only for cause. On appeal, plaintiff contends that this ruling was erroneous because genuine issues of material fact exist. After thorough review, we find no merit to any of plaintiffs arguments. At the outset, we reject plaintiffs argument that the provisions of the employment agreement were not fully disclosed. Although the document plaintiff signed contains additional provisions regarding medical insurance, withholding allowances, and the like, the section captioned "Employment Agreement” is plainly disclosed and appears directly above plaintiff’s signature on the back side of the form. The trial court correctly observed that one who signs a contract cannot seek to avoid it on the bases that he did not read it or that he supposed that it was different in its terms. Paterek v 6600 Limited, 186 Mich App 445, 450; 465 NW2d 342 (1990); Moffit v Sederlund, 145 Mich App 1, 8; 378 NW2d 491 (1985). The express terms of the contract also serve to negate plaintiff’s claim that a just-cause contract exists on the basis of oral representations made before his acceptance of the transfer. This Court has expressly observed that the language at issue provides for employment terminable at will. See Schipani v Ford Motor Co, 102 Mich App 606, 610-611; 302 NW2d 307 (1981). Thus, by signing the contract, plaintiff assented to employment at will, and he cannot maintain an action based on prior oral assurances. See Scholz v Montgomery Ward & Co, Inc, 437 Mich 83, 92-93; 468 NW2d 845 (1991). We turn now to what appears to be the crux of plaintiff’s wrongful discharge claim. As noted above, the contract language providing for termination "at any time, without advance notice,” creates employment at will. However, the contract further states that plaintiff’s employment "is subject to such rules, regulations, and personnel practices and policies, and changes therein, as Ford Motor Company may from time to time adopt.” Plaintiff submits that this language incorporates by reference numerous other documents that "qualify” the at-will relationship and give rise to the inference that plaintiff had a legitimate expectation that he could be terminated only for just cause. We disagree with plaintiff’s argument. In his brief, plaintiff relies on several employment manuals that he claims imply the existence of job security. Significantly, however, plaintiff has not pointed out statements within these documents specifically relating to termination only for just cause. Instead, plaintiff relies primarily on a document entitled "Industrial Relations Administration Manual.” This document is approximately twenty-five pages in length and contains extensive and detailed procedures governing employee discipline. Many of these procedures contain mandatory language that the procedures must be employed before an employee can be discharged. Recently in Biggs v Hilton Hotel Corp, 194 Mich App 239; 486 NW2d 61 (1992), this Court squarely addressed the issue whether an employer’s adoption of disciplinary guidelines transforms an at-will employment relationship into one prohibiting discharge absent just cause. Applying the Supreme Court’s recent decision in Rowe v Montgomery Ward & Co, Inc, 437 Mich 627; 473 NW2d 268 (1991), this Court held that an employer could promulgate disciplinary procedures without altering the at-will status of its employees. In pertinent part, the panel in Biggs explained at 241-242: The fact that defendant had established a disciplinary system for its employees and, apparently, obligated plaintiff to abide by that disciplinary system in dealing with his subordinates does not establish unequivocally plaintiffs position that he was a just-cause employee rather than an at-will employee. Certainly, it is not unreasonable to expect that an employer, particularly one such as defendant that employs a large number of individuals, would want a systematic method of dealing with its employees and would provide a consistent set of guidelines under which its managers would deal with subordinates. This does not mean that by doing so an employer establishes just-cause employment rather than at-will employment. The concept of at-will employment means not only that the employer, if it so chooses, may provide a disciplinary system and may terminate only for cause, but also that the employer may terminate for any other reason if the employer believes that that is in the best interests of the employer. Indeed, in this respect, we once again return to Rowe and note that even in Rowe the employer had created a disciplinary system for dealing with its employees, but the Supreme Court nevertheless concluded that the employee could not harbor any legitimate expectation of a policy of discharge for cause by the employer. Id. at 651. [Emphasis added.] We find. Biggs applicable to the present case. We conclude that by simply adopting disciplinary procedures applicable to salaried employees such as plaintiff, defendant did not alter the at-will relationship created when plaintiff signed the employment contract in 1968. Accordingly, we conclude that the trial court did not err in granting summary disposition on the basis that plaintiff was an at-will employee. Furthermore, even assuming a jury could find that defendant’s disciplinary policy constituted a contract prohibiting termination absent just cause, we conclude that plaintiff has failed to show the existence of a genuine issue of material fact regarding whether defendant breached the contract in terminating plaintiff. Plaintiff submits that defendant failed to follow thoroughly all of the detailed procedures outlined in the manual before terminating him. However, the manual does not require meticulous compliance in every instance. In pertinent part, the manual states: Many cases will involve events that are clear cut and all the facts can be developed from established incidents or documents that make the circumstances self-evident and irrefutable. Others will require varying degrees of intensity of investigation. There is no template or formula for measuring the degree of penalty since each case has its distinguishing characteristics. Fairness, consistency, and common sense control in dictating the prescribed penalties. In the present case, plaintiff was fired after he admitted circumventing defendant’s purchasing procedures and directing Ford’s business to certain suppliers he favored. Upon investigation, defendant concluded that plaintiffs actions constituted gross misconduct and a breach of his fiduciary relationship to the company. Plaintiffs own exhibit "F” attached to his brief indicates that he was fired with proper management approval. We conclude that defendant complied with its procedures and was therefore properly awarded summary disposition. See Hale v Comerica Bank-Detroit, 189 Mich App 382, 384-385; 473 NW2d 725 (1991). Finally, plaintiff argues that the trial court erred in dismissing his claim for intentional infliction of emotional distress. We disagree. Damages for intentional infliction of emotional distress are not recoverable in an action for breach of an employment contract. Mourad v Automobile Club Ins Ass’n, 186 Mich App 715, 731; 465 NW2d 395 (1991). Furthermore, the conduct alleged to have occurred is not so outrageous that it goes beyond all possible bounds of decency. See generally Meek v Michigan Bell Telephone Co, 193 Mich App 340, 346-347; 483 NW2d 407 (1992). Affirmed. Plaintiffs reliance upon Schippers v SPX Corp (On Remand), 194 Mich App 52; 486 NW2d 89 (1992), lv gtd 441 Mich 881 (1992), is misplaced. Unlike the present case and Rowe, supra, the express contract in Schippers did not establish an at-will employment relationship: On the other hand, the handbook in this case did not, as did the handbook in Rowe, clearly and unambiguously notify plaintiff of any policy of termination at will. [Schippers, supra at 56.]
Colin E. Boothby vs. Texon, Inc., & others. Hampden. November 3, 1992. March 4, 1993. Present: Liacos, C.J.. Wilkins. Abrams. Nolan. & Lynch. JJ. Contract, Employment, Performance and breach, Damages, Interference with contractual relationship. Corporation, Officers and agents. Frauds, Statute of. Employment, Termination. Damages, Termination of employment contract, Interest. Interest. Unlawful Interference. At the trial of a claim for breach of an employment contract the plaintiff produced sufficient evidence for the jury to conclude that a corporation’s board of directors had authorized the corporation’s president to enter into a contract for the plaintiffs permanent employment [476-477], and that the contract was an express contract for his permanent lifetime employment [477-478], The Statute of Frauds did not bar enforcement of an oral contract for permanent employment, where the contract could have been performed within one year. [478-479] At the trial of a claim for breach of an employment contract, the judge did not err in instructing the jury that it should use a “reasonable employer” standard in determining whether the employer had a right to terminate the employee for failing to perform satisfactorily [479-481], and there was sufficient evidence to submit the issue of satisfactory performance to the jury [481-482], At the trial of a claim for breach of an employment contract the plaintiff produced sufficient evidence for the jury to conclude that, at the time of the plaintiffs termination, there was other appropriate work in the defendant’s organization of the nature for which the plaintiff had been hired that he could have done. [482-483] In an action for breach of an employment contract the judge correctly determined that a certain jury instruction proposed by the defendant was not relevant to the facts of the case. [483-484] In an action for breach of a contract for lifetime employment, the plaintiff presented sufficient evidence to support the jury’s finding that he would incur future damages, that is, damages for the term of the contract beyond the date of trial and ample evidence as to the amount of damages, and the defendant’s motion for judgment notwithstanding the verdict was correctly denied. [484-486] At the trial of a claim of intentional interference with an advantageous relationship, the defendant’s motion for a directed verdict was properly granted where the plaintiff's evidence was insufficient to permit a finding that the defendant acted with actual malice in terminating the plaintiff’s employment. [486-488] The judge in a civil action properly denied the plaintiffs motion to amend the judgment to include twelve per cent interest from the date of the breach of contract to the date of the verdict, where the special questions submitted to the jury provided no way to annualize or otherwise make a yearly apportionment of the damages awarded for the purposes of assessing interest. [488] Civil action commenced in the Superior Court Department on October 18, 1984. After trial before Lawrence B. Urbano, J., a motion for a new trial was allowed by him. The case was retried before William H. Welch, J. The Supreme Judicial Court granted a request for direct appellate review. Mark S. Dichter of Pennsylvania (Joseph W. Ambash with him) for Texon, Inc. Charles V. Ryan (Joan C. Steiger with him) for the plaintiff. Thomas Bleasdale, president of the Footwear Industries Group of Emhart Corp., William C. Lichtenfels, executive vice president and a director of Emhart, and A. Peter Clackson, president and chief executive officer of Texon. Abrams, J. The parties have now been through two trials of the same issues. After the first verdict in favor of the plaintiff,. Colin E. Boothby, the judge allowed the motion of Texon, Inc. (Texan), for a new trial, determining that the verdict was against the weight of the evidence. At the second trial with a different judge, the jury again awarded Boothby significant damages. Each party has appealed. Texon challenges, under various theories, the denials in both trials of motions for judgment notwithstanding the verdict and for a third trial. Boothby appeals the judge’s allowance; in the first trial, of Texon’s motion for a directed verdict on his count of promissory estoppel and of A. Peter Clackson’s motion for a directed verdict on Boothby’s allegation of intentional interference with an advantageous relationship. Boothby also claims that the judge in the second trial erred in denying his motion to amend his order to allow for the addition of interest on the judgment. We granted Texon’s application for direct appellate review. We affirm. Texon appeals from the denials of motions for judgment notwithstanding the verdict and for new trials. The standard for reviewing the denial of a motion for judgment notwithstanding the verdict is “whether ‘anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn .in favor of the plaintiff.’ Poirier v. Plymouth, 374 Mass. 206, 212 (1978), quoting Raunela v. Hertz Corp., 361 Mass. 341, 343 (1972).” Dobos v. Driscoll, 404 Mass. 634, 656, cert. denied sub nom. Kehoe v. Dobos, 493 U.S. 850 (1989). We therefore summarize the evidence in the light most favorable to the plaintiff. Coliu Boothby, a British citizen, worked for Bata Corporation for thirty years, beginning when he was sixteen years old. Bata was the biggest shoe company in the world. Boothby worked his way up, eventually serving on the personal staff of the owner and chief executive from 1972 until 1978. In 1978, Boothby became the general manager for Bata’s operation in Thailand where he was in charge of three factories, one hundred retail stores, twelve distribution depots, and almost three thousand employees. Texon, headquartered in South Hadley, Massachusetts, manufactured and sold insoles for shoes. Bata was one of its biggest customers, purchasing over two million dollars worth of insoles each year. From 1972 until 1978, Boothby and Lee Asseo, the president of Texon, handled the transactions between the two companies. In the first trial, Boothby testified that he considered Asseo to be “a man of high integrity and honesty,” For Boothby, Asseo’s “word was his bond.” Because Texon perceived a gap in its senior management, it was interested in recruiting Boothby. Texon had tried to lure Boothby away from Bata in 1976 and again in 1980. In both trials, Asseo said that he discussed the possibility of hiring Boothby with Texon’s board of directors at every board meeting from March, 1980, through August, 1981. Dudley Schoales, the chairman of the board, agreed that there were discussions at the board level about hiring Boothby. When asked if the board had authorized Asseo to meet with Boothby, Schoales said, “We sure pressed him to do it.” When asked what authority the board gave Asseo, Schoales stated, “I said anything that you can do to get him we ought to do.” Asseo met with Boothby in Bangkok, Thailand, in late January, 1981. Boothby communicated his concerns about leaving Bata to Asseo, noting that the promotional expectations he had made him very happy at Bata. Boothby “wasn’t prepared to make any move out of Bata or to even consider making any move out of Bata unless something was going to be attractive, something was going to be a challenge to [him], something was going to be permanent.” Boothby said that he informed Asseo that he had “almost one hundred percent job security with Bata due to [his] record, thirty years’ service, [his] present position and the need” for senior managers like him. In a follow-up letter, Asseo noted that Texon would be “giving [Boothby] an essentially permanent opportunity to spend the rest of your professional career in the so-called totally civilized side of the world.” In response, Boothby sent a return letter, listing the job security he had at Bata as one of his reasons for being wary of leaving. Both Schoales and Asseo stated that they understood that job security was a priority issue for Boothby and that salary alone would not convince Boothby to join Texon. Boothby stated that he wanted all points to be clarified before he actually accepted any position so there would be no problems later. Boothby and Asseo met again in South Hadley in July, 1981. Asseo told Boothby that Texon would be merging with Emhart Corporation (Emhart). Boothby testified that he informed Asseo that he was not going to make a move to Texon unless he had “absolute security.” He also told Asseo that this point was non-negotiable. Asseo assured him that, should he accept the position, Boothby would spend the rest of his working career at Texon. As part of the merger, Texon was required to inform Em-hart of any employees whose compensation was over $75,000. Boothby’s name was not included, on the advice of an attorney, because he had not yet begun work. The attorney suggested that it would be appropriate for Asseo to call the accepted offer of employment to Emhart’s attention. Asseo did discuss the accepted offer with Steven R. Ruffi who was the executive vice president of Emhart and who agreed that Boothby’s name did not belong on the schedule. The merger went through and, effective September 4, 1981, the resultant corporation was known as Texon, Inc. Boothby began working at Texon on October 13, 1981. In February, 1983, there was a reorganization in which Asseo became the president of the Footwear Materials Group (FMG). The rest of the footwear concerns were encompassed in the Footwear Industries Group (FIG), headed by Thomas Bleasdale. Boothby’s title was vice president/North American operations in FMG. On August 31, 1983, Asseo resigned as president of FMG and from Texon. Asseo testified that he had worked with Boothby from October, 1981, through August, 1983, and, at the time he left, knew of no valid reasons for firing Boothby. He also had not noted any inadequacies in Boothby’s performance. Texon had granted Boothby a series of merit raises. Asseo said that he had conversations with Ruffi and Bleasdale concerning the naming of his successor. Asseo explained that he had offered the names of George Oks, vice president in charge of European operations, Boothby, and an individual from outside Texon. Bleasdale suggested A. Peter Clackson and William Scanlon, the president of the Shoe Machinery Group. Asseo did not think that the candidates Bleasdale suggested were as appropriate as his own recommendations. Clackson was chosen as Asseo’s replacement. Boothby testified that Mario del Greco, an employee of twenty-five years, was promoted to regional marketing director for the Americas region. On July 10, 1984, Boothby presented del Greco’s job description to Clackson. Clackson declared that del Greco’s job was a “nothing job” and instructed Boothby to fire him. Boothby declared that this was not proper. They discussed the matter further. Clackson testified that he suggested Boothby demote del Greco to a job below the one from which he had been promoted. Boothby did not want to do this either. In the deposition Clackson said that he then ordered Boothby to fire del Greco. Boothby refused to do so, suggesting that Clackson should do it himself if he felt so strongly about it. Del Greco was not fired. In his deposition, in response to a question, Clackson said: “If I have a manager who reports to me who won’t do what he is told, it isn’t up to me to do what he should have done, it is up to me to rectify that situation.” On August 16, 1984, Clack-son called Boothby into his office to notify him that Clackson was reorganizing FMG and that Boothby’s job was being eliminated. He was told to leave the next day. Asseo stated that Texon’s informal policy was to terminate employees only for cause and that, before terminating them from the organization, Texon would make efforts to place the employees elsewhere in the company. Emhart had a similar policy. The deposition testimony of Royal Cowles, the vice president for human resources of Emhart Corporation, indicated that he and Clackson did not discuss the possibility of placing Boothby elsewhere in the organization. Cowles did, however, confirm that Boothby’s termination was not a discharge. Cowles explained that Boothby’s termination was not for cause, because, in that case, Boothby would not have been eligible for the six months’ severance pay he received. Asseo said that, during his tenure, no manager had ever been fired for failing to achieve the projection of profits indicated in a submitted budget. He also noted that all layers of management would tinker with the budgets, making modifications. The plaintiff sued the corporation and three of the officers on various theories. During the proceedings, the plaintiff waived his allegation of breach of implied contract. The judge dismissed the plaintiff’s allegation of promissory estoppel, granted Bleasdale’s motion for summary judgment of the count of intentional interference with an advantageous relationship, and granted Clackson’s motion for a directed verdict on the same count at the close of the plaintiff’s evidence. Another judge dismissed the plaintiff’s allegation of negligence. Special questions were submitted to the jury on the question of the breach of an express contract. The jury in the first trial found that (1) Boothby sustained the burden of proving that Texon entered into a permanent employment contract with Boothby guaranteeing him employment until death or retirement unless earlier terminated for unsatisfactory performance or lack of appropriate work; (2) he sustained the burden of proving that Texon’s board of directors either authorized or ratified the action of Asseo in entering the employment contract; (3) Texon failed to sustain the burden of proving that it had justifiable cause for terminating Boothby’s employment; and (4) Texon failed to sustain the burden of proving that there was no other appropriate work at Texon for Boothby to undertake at the time of his termination. That jury also returned a verdict as to damages. The jury awarded Boothby $296,100 plus interest as damages from the date of his termination until the date of trial. It also awarded $3,598,866 for future damages. Texon moved for judgment notwithstanding the verdict or in the alternative a new trial. On January 30, 1990, the judge denied the motion for judgment notwithstanding the verdict, but allowed the motion for a new trial. He determined that the evidence made it unlikely that Boothby and Asseo entered into an express contract that was to cover nineteen years. Therefore, he found that “the jury verdict in finding the permanent contract proven is so greatly against the weight of the evidence as to induce the belief that it was not the result of a careful consideration of the evidence but was the ‘product of bias, misapprehension or prejudice.’ Solimene v. B. Grauel & Co., [KG], 399 Mass. 790, 802 [(1987)].” On April 26, 1989, Black & Decker Corporation acquired Emhart. Black & Decker sold off the shoe manufacturing business on March 30, 1990. The case proceeded to a second trial on a count for breach of express contract only. Again, the jury were presented with special questions. The judge noted that the jury “found there was an oral express contract for permanent employment under the principle set forth in Carnig v. Carr, 167 Mass. 544 (1897), that it was authorized by Texon, that Texon, i.e., Emhart did not have justifiable cause to terminate him and there was work of type he was hired to perform available.” The jury awarded Boothby $2,146,560. Boothby moved to amend the order to include provision for interest and costs. The judge denied the motion. Texon moved for judgment notwithstanding the verdict and for a remittitur or a new trial. The judge denied the motions, con-' eluding that “there was evidence on which the jury could find Boothby had an excellent secure job with an international concern, Bata Shoe, that he was one of a small number close to the top, that he had excellent security and pension benefits [and] could have retired at age 60, that he did not want to consider a move unless he was sure the position would be permanent with excellent security, that Texon recruited him strenuously and risked loss of a good customer to get Boothby.” The judge continued: “I cannot say there was no basis for the jury’s verdict particularly when two juries have come out with significant verdicts. It appears they felt there was a contract, that Boothby was wrongfully terminated, that there was work he could have done of [the] type [for which] he was hired, that no other meaningful employment was offered, that what he could make from his own employment was substantially below what he would have made or received in pension and retirement benefits if he had not been terminated.” Texon s Appeal. 1. The existence of an enforceable contract for permanent employment. Both parties discuss Carnig v. Carr, 167 Mass. 544 (1897), a case where an enameller sold his business to the defendant in exchange for which the defendant agreed to employ the plaintiff permanently. Six months later, the defendant wrongfully and without cause terminated the plaintiff, who sued the defendant. “To ascertain what the parties intended by ‘permanent employment,’ it is necessary to consider the circumstances surrounding the making of the contract, its subject, the situation and relation of the parties, and the sense in which, taking these things into account, the words would be commonly understood.” Id. at 547. In Carnig v. Carr, we held that “the words would be commonly understood as meaning that, so long as the defendant was engaged in enamelling and had work which the plaintiff could do and desired to do, and so long as the plaintiff was able to do his work satisfactorily, the defendant would employ him, and that in that sense the employment would be permanent.” Id. a. Evidence of authority of Asseo to enter into a lifetime contract. The defendant, citing Rydman v. Dennison Mfg. Co., 373 Mass. 855 (1977), and Simonelli v. Boston Hous. Auth., 334 Mass. 438 (1956), states that the appellate courts of Massachusetts have narrowed the holding of Carnig v. Carr. What these cases actually do is insist that the plaintiff show that the individual with whom he or she entered into a contract for lifetime employment had the authority to do so. For example, in Rydman v. Dennison Mfg. Co., we held that the defendant’s motion for a directed verdict should have been allowed because “of the plaintiffs failure to produce evidence from which the jury could find or infer (a) that the personnel director and the engineer had implied or apparent authority to bind the defendant to a fourteen-year contract, or (b) that the defendant had ratified the alleged contract.” Id. In Simonelli v. Boston Hous. Auth., we noted that “[tjhere was no evidence that either [the manager] or [the personnel director] had ever made any contracts of permanent employment with any of the employees of the defendant, or that the defendant held them out as possessing such powers, or that it ever knew they or either of them attempted to exercise such powers.” Id. at 441. Boothby introduced evidence tending to prove that the board of directors of Texon had given Asseo the authority to bind Texon to a lifetime contract. Asseo said that the board of directors agreed that Texon needed someone with international experience to direct North American operations. He testified that the board members either knew Boothby personally or by reputation. Asseo reported to the board on his negotiations with Boothby and told the board members that it was job security, not salary, that most concerned Boothby. Asseo and Schoales both said that at one board meeting Schoales, chairman of the board of directors, told Asseo to do whatever necessary to get Boothby to leave Bata and join Texon. No
McLEMORE v DETROIT RECEIVING HOSPITAL AND UNIVERSITY MEDICAL CENTER Docket No. 134930. Submitted August 13, 1992, at Detroit. Decided October 19, 1992, at 10:10 a.m. Leave to appeal sought. Orrie C. McLemore brought an action in the Wayne Circuit Court against Detroit Receiving Hospital and University Medical Center and others, alleging sex discrimination, breach of an employment contract, and retaliatory discharge for her filing of a sex discrimination charge with the Equal Employment Opportunity Commission. The jury found that plaintiff’s employment was terminated in retaliation for filing the charge and that the defendants breached their employment contract with the plaintiff. The court, J. Phillip Jourdan, J., entered a judgment consistent with the jury verdict for the plaintiff for $465,445.72, including prejudgment interest. The defendants appealed from the portion of the judgment finding retaliatory discharge. The Court of Appeals held: 1. There was sufficient evidence to support the retaliation claim. Regardless of the vagueness of an employee’s charge or the lack of a formal invocation of the protection of the Civil Rights Act, if an employer’s decision to terminate or otherwise adversely effect an employee is a result of that employee’s raising the possibility of a discrimination complaint, retaliation prohibited by the act occurs. The evidence supports the inference that, in eliminating the plaintiff’s position, the defendants merely took advantage of an opportunity to do what they had been preparing to do, and that the economic necessity they asserted was a pretext. The trial court properly denied the defendants’ motion for judgment notwithstanding the verdict. References Am Jur 2d, Appeal and Error §§ 398, 404, 797; Civil Rights §§ 223-225, 446; Job Discrimination §§ 127-150. Award of attorneys’ fees under § 706(k) of Civil Rights Act of 1964 (42 USCS § 2000e-5(k)) authorizing court to allow prevailing party, other than Equal Employment Opportunity Commission or United States, reasonable attorney’s fee as part of costs in action under equal employment opportunities part of Act. 16 ALR Fed 643; Construction and application of § 704(a) of Civil Rights Act of 1964 (42 USC § 2000e-3(a)), making it unlawful employment practice to discriminate against individual for participation in equal opportunity proceedings or activities. 11 ALR Fed 316. 2. The trial court did not abuse its discretion in denying the defendants’ motion for a new trial. The verdict was not against the great weight of the evidence. 3. The trial court erred in instructing the jury that the defendants had the burden of proving their claim that the layoff was motivated by the hospital’s economic problems. However, because the jury returned a verdict it was told it could reach only if it found that the plaintiff had proven that the defendants had a retaliatory motive and that the economic justification the defendants put forth was a sham or pretext, the error could not have affected the verdict. Therefore, reversal is not required. 4. The defendants’ failure to provide the Court of Appeals with a transcript of the trial court’s ruling regarding their request for remittitur precludes review of their claim that the court erred in denying the request. 5. By not requesting attorney fees in the trial court and not filing a cross appeal, the plaintiff waived any right she may have had to attorney fees for work done before the entry of the judgment. 6. The Court of Appeals has discretion to award the plaintiff appellate attorney fees under the Civil Rights Act, MCL 37.2802; MSA 3.548(802). Remand to the trial court is appropriate for a determination and award of reasonable appellate attorney fees. Aifirmed and remanded. 1. Civil Rights — Discrimination Complaints — Retaliation. Regardless of the vagueness of an employee’s charge of a violation of the Civil Rights Act or the lack of formal invocation of the protection of the act, if an employer’s decision to terminate or otherwise adversely effect an employee is a result of that employee’s raising the possibility of a discrimination complaint, retaliation prohibited by the act occurs (MCL 37.2701; MSA 3.548[701]). 2. Appeal — Jury Instructions. Reversal is required because of an erroheous jury instruction only where the failure to reverse would be inconsistent with substantial justice. 3. Appeal •— Remittitur — Preserving Question — Transcripts. Failure to provide the Court of Appeals with a transcript of a trial court’s ruling on a motion for remittitur precludes consideration of the claim that the court erred in denying the motion (MCR 7.210[B][l][a]). 4. Civil Rights — Appellate Attorney Fees. The Court of Appeals may award appellate attorney fees in an action brought under the Civil Rights Act (MCL 37.2802; MSA 3.548[802]). Clayton C. Jones, for the plaintiff. Honigman Miller Schwartz & Cohn (by Thomas E. Marshall and Ingrid K. Brey), for the defendants. Before: Neff, P.J., and Gribbs and Shepherd, JJ. Shepherd, J. A jury found that defendants terminated plaintiff’s employment in retaliation for her filing a sex discrimination charge with the Equal Employment Opportunity Commission. Pursuant to the jury’s verdict, the trial court entered judgment for plaintiff for $465,445.72. Defendants appeal as of right. We affirm and remand for further proceedings. Plaintiff was a clinical instructor at defendant hospital’s school of radiologic technology. In February of 1982, defendant Thomas Gallagher, director of radiology, appraised plaintiff’s performance as "effective.” In March of 1983, the educational coordinator, defendant Gail Alexander, also evaluated plaintiff’s performance as "effective.” When Alexander became associate director of radiology, plaintiff applied for the vacant educational coordinator’s position. Her interview in September of 1983 did not go well. Gallagher focused his attention on what he felt were inaccuracies in plaintiff’s resume._ Gallagher, Alexander, and Dr. Kenneth Krabbenhoft, the chief director of radiology, ultimately chose a man for the position. Plaintiff filed a complaint with the hospital expressing concern that the hiring decision may have been the result of "bias,” and requesting an explanation for the decision in order to avoid "litigation.” Plaintiff was told the man was selected because of his superior qualifications. As part of their response to plaintiff’s complaint, Alexander and Gallagher sent plaintiff memoranda criticizing her job performance. The man did not work out and resigned. In January 1984, plaintiff once again applied for the position. Gallagher, Alexander, and Dr. Krabbenhoft selected defendant Donald Stokes to be the new educational coordinator. Almost immediately, Stokes too began criticizing plaintiff’s job performance. At the end of March 1984, he appraised plaintiff’s performance as "unsatisfactory.” On April 2, 1984, plaintiff filed a complaint with the eeoc, charging defendants with sex discrimination. For years the hospital had been having financial difficulties. In the spring of 1984, Gallagher ánd Alexander were asked to identify positions in the radiology department that could be eliminated as part of a hospital-wide staff reduction. They recommended eliminating plaintiff’s position. At the time, Gallagher knew plaintiff had filed a complaint with the eeoc. Plaintiff was laid off on May 31, 1984. Plaintiff filed this action, charging sex discrimination, breach of contract, and retaliatory discharge. The trial court directed a verdict for defendants with regard to the sex discrimination charge, a ruling plaintiff has not appealed. The jury returned a verdict for plaintiff, finding that retaliation was a significant factor in defendants’ decision to lay her off, and that defendants violated the hospital’s policies by laying her off and subsequently failing to rehire her. The jury awarded plaintiff $13,500 for economic damages and $250,000 for emotional distress. The trial court entered judgment on the verdict for plaintiff for $465,445.72, including prejudgment interest. i Defendants first contend there was insufficient evidence to support the retaliation claim. We disagree. Defendants moved for judgment notwithstanding the verdict, contesting the sufficiency of the evidence. The trial court denied the motion. When deciding a motion for judgment notwithstanding the verdict, a trial court must examine the testimony and all legitimate inferences that may be drawn therefrom in a light most favorable to the plaintiff. Reisman v Regents of Wayne State Univ, 188 Mich App 526, 538; 470 NW2d 678 (1991). If the evidence is such that reasonable jurors could have found for the plaintiff, neither the trial court nor this Court may substitute its judgment for that of the jury. Id. Defendants contend there was no evidence that the decision to eliminate plaintiff’s position was motivated by anything other than economic considerations. They argue that because plaintiff did not file her charge with the eeoc until April 2, 1984, what went on before that date cannot support her claim of retaliation. We disagree. The Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq., prohibits employers from retaliating against an employee for making a charge, filing a complaint, testifying, assisting, or participating in an investigation, proceeding, or hearing under the act. MCL 37.2701; MSA 3.548(701). In Booker v Brown & Williamson Tobacco Co, Inc, 879 F2d 1304, 1312-1314 (CA 6, 1989), the federal court of appeals decided that the Civil Rights Act did not protect from retaliation an employee who had merely expressed concern to his employer about possible discrimination. We strongly disagree with this interpretation of the act. Regardless of the vagueness of the charge or the lack of formal invocation of the protection of the act, if an employer’s decision to terminate or otherwise adversely effect an employee is a result of that employee raising the spectre of a discrimination complaint, retaliation prohibited by the act occurs. We will not interpret the act to allow employers to peremptorily retaliate against employees with impunity. Doing so would be contrary to our state’s policy of protecting employees who are about to report a suspected violation of law. See MCL 15.362; MSA 17.428(2). The core issue in this case was defendants’ motivation for eliminating plaintiff’s job. Plaintiff did not dispute that defendant hospital’s financial distress was genuine, and that some jobs would have to be eliminated. Plaintiff contended her job was selected because defendants wanted to get rid of her for making a discrimination charge. Plaintiff produced no direct evidence that defendants’ motives were less than pure. The question therefore is whether the circumstantial evidence plaintiff did produce, when viewed in the light most favorable to plaintiff, was sufficient for the jury to legitimately infer that defendants were motivated by a desire to retaliate. Plaintiff presented evidence that defendants had begun to compile a paper record that would support her discharge long before the layoff. This evidence supports the inference that in eliminating her position, defendants merely took advantage of an opportunity to do what they had been preparing to do, and that the economic necessity was a pretext. Plaintiff presented evidence that defendants, who previously judged her job performance as effective, suddenly viewed it as unsatisfactory after she raised the issue of bias. In fact, the barrage of criticism of plaintiffs job performance actually began as defendants’ official response to plaintiffs internal complaint. This supports the inference that it was the internal complaint with its implied threat of a formal discrimination complaint and not-so-implied threat of litigation that caused the sudden change in how defendants viewed plaintiffs worth. Defendants point out that neither in the internal complaint nor in the meeting that followed did plaintiff expressly discuss sex discrimination. While this is relevant, we believe a rational trier of fact could still conclude that defendants’ reaction to the complaint was motivated by a fear that plaintiff, a black female, would eventually file a complaint charging some type of prohibited bias, either race or sex discrimination. From the moment they learned plaintiff was concerned about bias, defendants began doing things that could make a case for terminating her employment. They sent numerous memoranda to her criticizing her job performance. Yet she was being criticized for problems with the school outside her control, and for not completing tasks she had not been given. These memoranda and plaintiff’s performance evaluations express a level of overall dissatisfaction with her work that is difficult to reconcile with the praise she had received before her complaint. A rational trier of fact could infer that all this was motivated by a fear of an eeoc charge and litigation to follow. When plaintiff filed her complaint with the eeoc, defendants’ fears were realized, and they responded by using the first available opportunity to rid themselves of her. Furthermore, there was evidence of a hospital policy to offer laid-off employees other positions to the extent such positions were available. Plaintiff presented evidence that the policy was deliberately ignored in her case. Therefore, the evidence, viewed in a light most favorable to plaintiff, supports the inference that she was laid off in retaliation for charging defendants with sex discrimination. The trial court did not err in denying the motion for judgment notwithstanding the verdict. ii Defendants also contend that the trial court erred in denying their motion for a new trial. We disagree. Defendants argued below that they were entitled to a new trial because the verdict was against the great weight of the evidence. See MCR 2.611(A)(1)(e). The trial court disagreed. A trial court’s decision on such a motion is discretionary, and will not be disturbed unless an abuse of that discretion is shown. Bosak v Hutchinson, 422 Mich 712, 737; 375 NW2d 333 (1985). The jury, with sufficient evidence before it, found that the evidence established plaintiff’s claims. The trial court, with its unique vantage point of both the evidence and the proceedings, found the verdict not to be against the great weight of the evidence. Our reading of the record does not show that ruling to have been an abuse of the trial court’s discretion. in Defendants next argue that the trial court erred in instructing the jury about the burden of proof. The trial court told the jury that plaintiff had the burden of proving that retaliation played a significant role in her layoff. The court instructed the jury that plaintiff had the burden of proving that defendants’ claim of economic necessity was a sham or pretext. However, the court also told the jury that the defendants had the burden of proving their claim that the layoff was motivated by the hospital’s economic problems. The trial court’s instruction was erroneous. As the party seeking to change the status quo, the burden of proof was on plaintiff to show that she was entitled to the relief she sought. Although the burden of production may have shifted to defendants to articulate a legitimate reason for laying plaintiff off, the burden of proof did not shift. See Polk v Yellow Freight System, Inc, 876 F2d 527, 531 (CA 6, 1989). If a jury charge is erroneous, reversal is required only where failure to reverse would be inconsistent with substantial justice. Reisman, supra, p 532. Although the trial court erred in instructing the jury, we find that the error could not have affected the verdict, and, therefore, do not reverse. The parties’ claims concerning defendants’ motivation for eliminating plaintiff’s job were mutually exclusive. Either defendants were motivated by a desire to retaliate for the discrimination complaint as plaintiff claimed, or they were motivated by the economic situation, as defendants claimed. Although the jury instructions were erroneous, the error could only affect the verdict in one situation. If a preponderance of the evidence demonstrated that defendants were retaliating while using the economic situation as a pretext, then, according to the instructions given, the jury would properly return a verdict for plaintiff. If a preponderance of the evidence demonstrated that the layoff was motivated by the economic situation, and that a desire to retaliate was not a significant factor in the decision, then the jury would properly return a verdict for defendants. It is only if the jury could not decide what defendants’ motivation was, if the evidence was in equipoise, that the instructional error would have any effect. The jury was not told what to do in such a situation. A properly instructed jury would know to return a verdict for defendants. The record makes it clear that the jury did not find the evidence to be in equipoise. The jury returned a verdict it was told it could reach only if it found that plaintiff had proven that defendants had a retaliatory motive and plaintiff had also proven that the economic justification defendants put forth was a sham or pretext. Therefore, the instructional error could not have affected the verdict and, therefore, is not grounds for reversal. IV Defendants contend that the trial court erred in denying their request for remittitur. The jury awarded plaintiff $250,000 for the emotional distress she suffered. Defendants did not object to the verdict form, nor did they object to the instructions regarding how the jury should arrive at an amount for compensating plaintiff. When deciding a motion for remittitur, a trial court must determine whether the jury verdict is for an amount greater than the evidence can support. MCR 2.611(E). When reviewing the trial court’s decision, this Court must afford due deference to the trial court’s unique ability to evaluate the jury’s reaction to the evidence, and only disturb the trial court’s decision if there has been an abuse of discretion. Palenkas v Beaumont Hosp, 432 Mich 527, 533-534; 443 NW2d 354 (1989). The trial court considered defendants’ motion for remittitur and ruled from the bench on October 19, 1990. On November 2, 1990, the trial court signed an order denying the motion "for the reasons stated on the record.” Defendants have not provided this Court with a transcript of the proceedings of October 19, 1990, something they were required to do. See MCR 7.210(B)(1)(a). On the record before us we can only say that there was evidence that plaintiff suffered emotional distress as a result of defendants’ actions, the jury thought that $250,000 would adequately compensate plaintiff for her distress, and the trial court decided that defendants were not entitled to remittitur. Without the record of the trial court’s ruling from the bench, it is simply not possible for us to determine whether the trial court abused its discretion or properly exercised it. See Wilson v General Motors Corp, 183 Mich App 21, 40; 454 NW2d 405 (1990) (remittitur of mental anguish award to $375,000 not an abuse of discretion). We find defendants’ failure to provide this Court with a transcript of the ruling to preclude our review of this issue. See Brown v JoJo-Ab, Inc, 191 Mich App 208, 210; 477 NW2d 121 (1991). v Plaintiff asks this Court to remand for an award of post-verdict attorney fees. Plaintiff filed no cross appeal. She requested no attorney fees in the trial court. Therefore, she has waived any right she may have had to attorney fees for work done before entry of judgment. MCL 37.2802; MSA 3.548(802); MCR 2.625(F). Plaintiff apparently seeks to recover the attorney fees incurred defending this appeal. This Court has not previously decided whether appellate attorney fees are recoverable under MCL 37.2802; MSA 3.548(802). The subject of this appeal, plaintiff’s action, was
David B. Miller vs. Labor Relations Commission. No. 90-P-1536. Suffolk. February 20, 1992. October 14, 1992. Present: Armstrong, Perretta, & Greenberg. JJ. Labor Relations Commission. Regulation. Administrative Law, Regulations. Limitations, Statute of. The Labor Relations Commission acted within its statutory authority in adopting a regulation that time-barred an employee’s claim against his union for violating its duty to represent him fairly [406-408], and the regulation, as applied to his claim, did not work an arbitrary or capricious result [408-409]. Appeal from a decision of the Labor Relations Commission. Jean Strauton Driscoll for Labor Relations Commission. Paul Peter Nicolai, for David B. Miller, submitted a brief. Greenberg, J. The plaintiffs nine-year campaign contesting his denial of tenure by the Board of Regents of Higher Education (board), illustrates the wisdom of the Labor Relations Commission’s deadline for filing prohibited practice charges. The rule is contained in 456 Code Mass. Regs. § 15.03 (1986), and provides: “Except for good cause shown, no charge shall be entertained by the [cjommission based upon any prohibited practice occurring more than six months prior to the filing of a charge with the [commission.” In 1986, the plaintiff sought to vacate an adverse 1983 arbitration award by bringing an action in the Superior Court against the board, and later amending it to include his bargaining representative, the Massachusetts Teachers Association (MTA). The arbitrator concluded that there was no ar-bitrable dispute, because of the plaintiffs failure to follow the appropriate grievance procedure outlined in the collective bargaining agreement. The MTA notified the plaintiff that it would not appeal the arbitrator’s decision. That case resulted in Miller v. Regents of Higher Educ., 405 Mass. 475 (1989), in which the Supreme Judicial Court held that because the plaintiff was not a “party” to the collective bargaining agreement, he lacked standing under G. L. c. 150E, § 11, to seek to vacate the award. In the closing paragraph of the opinion, the court noted, “If [the plaintiff] was dissatisfied with the MTA’s refusal to seek judicial review of the arbitrator’s award, he was entitled to present a claim to the Labor Relations Commission under G. L. c. 150E, § 11 (1988 ed.), that the MTA violated its duty to represent him fairly.” Id. at 480. Prompted by this reproof, the plaintiff then filed a charge with the commission in November of 1989, alleging that the MTA wronged him by not filing a grievance on his behalf in June of 1983. He also claimed that the MTA’s attorney improperly counseled him not to seek judicial review of the arbitrator’s award because of the adverse effect it might have on his contemplated wrongful termination claim. Reasoning that the plaintiff failed to file his charge within six months of the date he knew or should have known of the MTA’s stance in his arbitration case, the commission declined to issue a complaint. Its order, in pertinent part, stated: “Since the investigation clearly demonstrated that all of the events which form the basis of the [plaintiff’s] allegation that the Union breached its statutory duty occurred more than six months before he filed this charge, the charge must be dismissed as untimely filed under the Commission’s Rule. In so concluding, we find no good cause excusing the late filing of the charge [emphasis added]. The fact that the [plaintiff] may not have been aware of his right to seek redress against the Union under G. L. c. 150E at the Commission, and instead chose to institute court litigation directly against the Employer, is not sufficient cause for untimely filing. Nor does the Commission read the [Supreme Judicial Court’s] decision in the [plaintiffs] case to intimate that [he] is presently entitled to present a claim against the Union at the Commission under G. L. c. 150E, despite his failure to have initiated that claim within the time limits imposed by the Commission’s rules. In view of this determination, we need not evaluate the substantive merits of the charge against the Union in this case.” From this “precomplaint dismissal” by the commission, the plaintiff has appealed. See G. L. c. 150E, § 11; Quincy City Hosp. v. Labor Relations Commn., 400 Mass. 745, 747 (1987) (prehearing dismissal by commission is a “final order” reviewable under G. L. c. 150E, § 11). This appeal raises the question whether the commission exceeded its authority when it adopted the regulation which time-barred the plaintiffs claim against the union for violating its duty of fair representation. Cf. Reilly v. Massachusetts Bay Transp. Authy., 32 Mass. App. Ct. 410, 415-417 (1992), and cases cited. That an agency of the State may by regulation establish timetables and procedures to achieve its statutory goals is well settled. Scofield v. Berman & Sons, 393 Mass. 95, 101 (1984). Regulations “are treated by the court with the same deference as a statutory enactment.” Commonwealth v. B & W Transp., Inc., 388 Mass. 799, 803 (1983). Massachusetts’ State Pharmaceutical Assn. v. Rate Setting Commn., 387 Mass. 122, 127 (1982), citing Green-leaf Fin. Co. v. Small Loans Regulatory Bd., 377 Mass. 282, 293-294 (1979). Purity Supreme, Inc. v. Attorney Gen., 380 Mass. 762, 768 (1980). The first sentence of G. L. c. 23, § 9R, as appearing in St. 1973, c. 1078, enables the commission to “make, amend and rescind such rules and regulations as may be necessary to carry out the provisions of . . . G. L. c. 150E.” The plaintiff has a heavy burden to meet in attacking the validity of properly promulgated regulations, for he must show that the regulation has no rational relationship to the goals or policies of the agency’s enabling statute. Morris v. Commonwealth, 412 Mass. 861, 864 (1992), and cases cited. The plaintiff contends that the commission exceeded its authority when it established a six-month deadline to file prohibited practice charges. The central purpose of a statute of limitations is to bar all claims asserted after a certain period of time has elapsed from the date the right accrued. Melnick v. Perwak, 295 Mass. 512, 514 (1936). Greeley v. Zoning Bd. of Appeals of Framingham, 350 Mass. 549, 551-552 (1966). See also Black’s Law Dictionary 927 (6th ed. 1990). Statutes of limitation operate mechanically, in a manner completely unrelated to the merits of a case. 1 Corman, Limitation of Actions § 1.1 (1991). The contested regulation contains an exception; it allows charges to be filed after the six-month deadline when good cause is shown. Thus, this regulation is neither purely mechanical nor does it bar all claims after the deadline. Instead, the rule is somewhat elastic. It allows consideration of whether there is a valid reason for the party’s tardiness in filing charges. The Supreme Judicial Court has stated that § 15.03 “is not expressed precisely in the form of a statute of limitations .... [Rather] [i]t is phrased somewhat in the nature of a jurisdictional test.” Boston Police Superior Officers Fedn. v. Labor Relations Commn., 410 Mass. 890, 891 n.l (1991). As a State agency adjudicating a large number of employment disputes, the commission is entitled to promulgate regulations which ensure prompt preliminary determinations. “Regulations . . . within the ambit of the enabling statute . . . will be considered valid.” Commonwealth v. Racine, 372 Mass. 631, 635 (1977), citing Commonwealth v. Diaz, 326 Mass. 525, 530 (1950). The commission’s regulation is designed to prevent litigation of stale claims. See Town of Wayland, 3 M.L.C. 1724, 1728 (1977), afTd, 5 M.L.C. 1738 (1979). Therefore, we conclude that the regulation is rationally related to the purpose of the enabling statute and represents a valid exercise of its rule-making authority. The plaintiff gains no ground by his argument that we should construe the application of the filing deadline in his case as working an arbitrary and capricious result. The commission has appropriately construed its rule to apply when the charging party “knew or should have known” of the alleged violation (see City of Pittsfield, 4 M.L.C. 1905, 1908 [1978]), and it is a generally recognized principle that lack of knowledge of a potential remedy does not excuse a procedural misstep — especially where it is in the nature of a jurisdictional prerequisite. This is not a case where the MTA equivocated and left the plaintiff in an uncertain state as to whether it would represent him in his appeal. As the Supreme Court noted in Miller v. Regents of Higher Educ., 405 Mass. at 480, if the plaintiff was dissatisfied with the MTA’s refusal to seek judicial review of the alleged unfair award, he could, at that time, have presented his claim to the commission that the union violated its duty to represent him fairly. Over three years passed between the time the plaintiff alleged that the MTA refused to try to overturn the arbitrator’s award and the date he originally filed his charge against the board. Nor is there any basis to conclude that the alleged prohibited practice was of a continuing nature and occurred within the six-month limitation period for filing the charge. Compare Boston Police Superior Officers Fedn. v. Labor Relations Commn., supra at 893. As we said in Pattison v. Labor Relations Commn., 30 Mass. App. Ct. 9, 10 (1991): “In undertaking litigation, [the plaintiff] would have done well to seek a forum that would allow [him] to join both the union and the employer, for those parties putatively committed related wrongs.” The commission’s order is affirmed. So ordered. The commission adopted this rule on December 12, 1986, pursuant to the authority vested in it by G. L. c. 23, § 9R, and G. L. c. 30, §§ 2 & 3. This may be contrasted with the Federal analogue, 29 U.S.C. § 160(b) (1988), which contains a six-month limitation period, but has no exception for good cause shown. The Federal provision was enacted by Congress, and is viewed as a statute of limitations by Federal courts. NLRB v. Pennwoven, Inc., 194 F.2d 521, 526 (3d Cir. 1952) (Biggs, C.J., concurring). NLRB v. Brown & Root, Inc., 203 F.2d 139, 145 (8th Cir. 1953). In Lyons v. Labor Relations Comm., 397 Mass. 498, 503 (1986), the court decided that a forty-five day period of limitations for nonunion employees to file union agency fee challenges was unconstitutional under the equal protection clause of the Federal Constitution. The court did not hold that this provision was invalid as a statute of limitations, nor did it find any problem with the six-month period of limitations in § 15.03. We also note that an agency’s self-imposed jurisdictional limits do not implement specific statutory requirements. NLRB v. Chauffeurs, Teamsters & Helpers, Local No. 364, 274 F.2d 19, 24 (7th Cir. 1960).
DAVID TOMPKINS, Plaintiff v. JACK ALLEN and ROSES STORES, INC., Defendants No. 9126SC780 (Filed 6 October 1992) Master and Servant § 10.2 (NCI3d)— employer’s bad faith — -no public policy concern —no wrongful discharge of employee The trial court properly dismissed plaintiff’s claim for unlawful termination of his employment-at-will where plaintiff’s evidence tended to show only that his supervisor temporarily altered inventory records and then used the altered inventory records as an excuse for plaintiff’s discharge, a discharge which could have been carried out absent any reason, and such action on the part of the supervisor, though tending to show bad faith which is not to be condoned, did not rise to the level of public policy concern. Am Jur 2d, Master and Servant § 43. Modern status of rule that employer may discharge at-will employee for any reason. 12 ALR4th 544. Appeal by plaintiff from judgment entered 12 March 1991 in MECKLENBURG County Superior Court by Judge Julia V. Jones. Heard in the Court of Appeals 26 August 1992. On 1 July 1988, plaintiff David Tompkins filed a complaint in Mecklenburg County Superior Court against respondents Jack Allen and Roses Stores, Inc. The complaint alleged unlawful termination and breach of employment contract. Plaintiff took a voluntary dismissal of said action on 17 November 1989 and filed a new complaint on 26 October 1990. Plaintiffs second complaint re-alleged unlawful termination and breach of contract and added claims for negligent infliction of emotional distress and tortious interference with a contract. Defendants filed a motion to dismiss and a motion on the pleadings. On 12 March 1991, Judge Jones signed and filed an order dismissing the action with prejudice. Judge Jones dismissed plaintiffs claims for unlawful termination, breach of employment contract, and negligent infliction of emotional distress. The judge also determined that plaintiffs tortious interference with contract claim was barred by the statute of limitations. Plaintiff gave written notice of appeal to this Court on 11 April 1991. Pamela A. Hunter for plaintiff-appellant. Rayburn, Moon & Smith, P.A., by Matthew R. Joyner, for defendant-appellee Jack Allen. Perry, Kittrell, Blackburn & Blackburn, by Charles F. Blackburn, for defendant-appellee Roses Stores, Inc. WELLS, Judge. Plaintiff brings forward in this appeal the sole question of whether his claim for unlawful termination was properly dismissed. Because the trial court considered matters outside the pleading, the judgment entered there must be considered as one for summary judgment. Long v. Fink, 80 N.C. App. 482, 342 S.E.2d 557 (1986); Kessing v. National Mortgage Corp., 278 N.C. 523, 180 S.E.2d 823 (1971). This cause of action arises out of plaintiff’s termination as a store manager for a Roses Department Store. At the time of his dismissal, plaintiff was employed by defendant under an employment-at-will contract. Plaintiff alleged in his second complaint that defendant Jack Allen, plaintiffs supervisor, intentionally altered certain inventory records for which plaintiff was responsible and then used the altered records as a reason to terminate plaintiff’s employment with Roses. As a general rule, an employee-at-will has no claim for relief for wrongful discharge. Walker v. Westinghouse Electric Corp., 77 N.C. App. 253, 335 S.E.2d 79, disc. rev. denied, 315 N.C. 597, 341 S.E.2d 39 (1986). Either party to an employment-at-will contract can terminate the contract at will for no reason at all, or for an arbitrary or irrational reason. Privette v. University of North Carolina, 96 N.C. App. 124, 385 S.E.2d 185 (1989). However, this doctrine is not without limits and a valid claim for relief exists for wrongful discharge of an employee at will if the contract is terminated for an unlawful reason or a purpose that contravenes public policy. Coman v. Thomas Manufacturing Co., 325 N.C. 172, 381 S.E.2d 445 (1989); Sides v. Duke University, 74 N.C. App. 331, 328 S.E.2d 818, disc. rev. denied, 314 N.C. 331, 333 S.E.2d 490 (1985). Following the Coman decision, there was a significant amount of discussion as to how broadly the public policy exception would be applied and whether the Coman Court had recognized a bad-faith exception to the employment-at-will doctrine. In Amos v. Oakdale Knitting Co., 331 N.C. 348, 416 S.E.2d 166 (1992), our Supreme Court clarified North Carolina’s position on the employment-at-will doctrine and its exceptions. In Amos, the Supreme Court made it very clear that North Carolina has not recognized a distinct tort for a bad-faith discharge of an employee at will, nor has North Carolina adopted a bad-faith exception to the employment-at-will doctrine; “To repeat: our discussion of bad faith discharge in Coman was dicta. The issue in Coman was whether to adopt a public policy exception to the employment-at-will doctrine.” Amos, supra. Therefore, in order for a wrongful discharge claim arising out of an employment-at-will setting to withstand a motion for summary judgment, plaintiff must demonstrate that his claim falls under the public policy exception to the employment-at-will doctrine. Taking the forecast of evidence presented in the light most favorable to the plaintiff, it appears, as a matter of law, that plaintiff has failed to establish a claim for wrongful discharge. Taken as true, plaintiffs evidence tends only to show that his supervisor temporarily altered inventory records and then used the altered inventory records as an excuse for plaintiff’s discharge, a discharge which could have been carried out absent any reason. While plaintiff’s evidence tends to show bad faith, not to be condoned, such behavior does not rise to the level of public policy concern. In Privette, supra, a case somewhat similar to the case at bar, the plaintiff was discharged by his employer for failing to keep a clean work area. In his complaint, plaintiff claimed wrongful discharge and alleged that defendants conspired to make plaintiff’s work area appear to be in much worse condition than the other work areas. This Court held that while plaintiff’s allegations possibly asserted an arbitrary reason for discharge, they did not assert an unlawful reason. Similarly, in the case at bar, we hold that plaintiff failed to support his claim for wrongful discharge. Because of our holding, we need not address plaintiff’s other assignments of error. The trial court’s order of dismissal is Affirmed. Judges ORR and GREENE concur.
ROWRY v UNIVERSITY OF MICHIGAN Docket Nos. 91292, 91293. Argued April 7, 1992 (Calendar No. 2). Decided September 22, 1992. Ezra L. Rowry filed a grievance under a collective bargaining agreement against the University of Michigan, his employer, seeking reinstatement following dismissal as a bus driver. After the grievance had proceeded through the three-step procedure required under the collective bargaining agreement, it was submitted to arbitration. The arbitrator found discharge inappropriate and ordered Rowry reinstated without back pay. While the grievance was pending, the plaintiff filed a workers’ compensation petition, alleging that he was unable to work because of an aggravated hernia condition, blood pressure, and an ulcer condition due to the stress of the job. The petition was denied. Thereafter, he filed another grievance, which resulted in another three-step hearing and a denial of that grievance. The plaintiff then brought an action in the Court of Claims, seeking to enforce the arbitration award. The court, Peter D. Houk, J., granted summary disposition for the defendant on the ground that the lawsuit was barred by a six-month period of limitation. The plaintiff brought a second action in the Court of Claims, alleging breach of contract, discrimination under the Workers’ Disability Compensation and the Civil Rights Acts, and wrongful discharge. The court again granted summary disposition for the defendant, finding the action barred by the decision in the first case. The plaintiff appealed both decisions. The Court of Appeals, Cavanagh, P.J., and Jansen and T. J. Lesinski, JJ., consolidated the appeals and affirmed in an unpublished opinion per curiam, relying on Walkerville Ed Ass’n v Walkerville Rural Communities School, 164 Mich App 341 (1987), applying the six-month period of limitation of the public employees relations act (Docket Nos. 114413, 118325). The plaintiff appeals. In an opinion by Chief Justice Cavanagh, joined by Justices Levin, Brickley, and Mallett, the Supreme Court held: The plaintiff’s cause of action to enforce the arbitration award is not barred by the six-month period of limitation applied by the Court of Appeals. References Am Jur 2d, Arbitration and Award § 165. See the Index to Annotations under Arbitration and Award. 1. MCL 423.1 et seq.; MSA 17.454(1) et seq., the labor-mediation act, provides alternatives to resolve labor disputes through mediation and arbitration. After an arbitration award has been rendered, it is enforceable at law or in equity as the agreement of the parties. The act does not expressly limit the period during which a party may enforce an arbitration award. The public employees relations act’s six-month limitation period applied by the Court of Appeals, MCL 423.9d; MSA 17.454(10.3), pertains only to actions filed with the Employment Relations Commission. Application of that limitation by analogy is not appropriate in this case. Rather than seeking money damages for breach of contract the plaintiff sought specific performance of the arbitration award. Because a suit for the specific performance is purely an equitable remedy, the Court of Appeals erred in applying by analogy the pera six-month period of limitation. 2. Two time limitations are applicable to the enforcement of arbitration awards: the six-year period of limitation for breach of contract, and the equitable doctrine of laches, requiring the exercise of due diligence to ensure the timely prosecution of the claim to avoid undue prejudice. Ordinarily, a plaintiff has six years to seek enforcement of an arbitration award. In certain cases this period may be diminished substantially if the arbitration award grants equitable relief and a delay in its enforcement is shown to prejudice the defendant in a way that evokes laches to bar the claim. In this case, because the defendant failed to raise laches in its responsive pleadings or by motion, this affirmative defense was waived. As a result, the claim is governed solely by the six-year period of limitation applicable to a breach of contract. Because the plaintiff’s complaint was within this six-year period, he may seek enforcement of the arbitration award. Justice Griffin, joined by Justice Boyle, concurring, stated that application of the six-year limitation period in this case will seriously undermine state and federal policies favoring the prompt resolution of labor disputes. Involved here is more than a simple breach of contract or a straightforward refusal to, comply with an arbitration award. The plaintiff’s cause of action arises out of a collective bargaining agreement between his union and his employer, and includes a grievance procedure designed to effect prompt resolution of disputes. If a policy of prompt resolution of labor disputes is to have meaning, a relatively short limitation period should govern resort to the courts after exhaustion of a grievance procedure. Justice Riley, concurring, stated that because the labor mediation act, the collective bargaining agreement, and the arbitration award do not provide a period of limitation for enforcement of an arbitration award, the six-year period of limitation for breach of contract must apply. MCR 2.116(C)(6) is designed to stop parties from litigating matters involving the same questions and claims presented in pending litigation. In this case, the plaintiff filed a second lawsuit against the same party, alleging exactly the same events. Because the same claim was being litigated by the plaintiff in the Court of Appeals and in the Court of Claims, the defendant was entitled to summary disposition pursuant to MCR 2.116(C)(6). Reversed and remanded. Labor Relations — Arbitration — Limitation op Actions — Laches. An action for enforcement of an arbitration award is limited by the six-year period for breach of contract and by the equitable doctrine of laches; application by analogy of the six-month period of limitation provided by the public employees relations act is inappropriate (MCL 600.5807[8], 600.5815; MSA 27A.5807[8], 27A.5815). Hurbis, Cmejrek, Clinton & Fernandez (by James R. Cmejrek) and Kurt Berggren for the plaintiff. Butzel, Long (by Virginia F. Metz and Lynne E. Deitch) for the defendant. Amici Curiae: Dickinson, Wright, Moon, Van Dusen & Freeman (by Noel D. Massie) and Miller, Canñeld, Paddock & Stone (by Diane M. Soubly) for the American Society of Employers and Greater Detroit Chamber of Commerce. Cavanagh, C.J. The plaintiff has appealed to this Court raising two issues: (1) whether the plaintiff’s first complaint to enforce an arbitration award ordering the University of Michigan to reinstate the plaintiff is barred by a period of limitation, and (2) whether the plaintiff’s second complaint, alleging wrongful discharge, breach of contract, discrimination under the Civil Rights Act, and discrimination under the Workers’ Disability Compensation Act, is barred by the first complaint to enforce the arbitration award. We hold that the plaintiff’s cause of action to enforce the arbitration award is not barred by the six-month period of limitation applied by the Court of Appeals. Because we resolve the first issue in favor of the plaintiff, we need not reach the second issue. We reverse the judgment of the Court of Appeals and remand the case to the trial court for further proceedings consistent with this opinion. i The plaintiff, employed by the University of Michigan as a bus driver since 1973, was discharged in November 1986 for negligently operating his bus. He filed a grievance under his collective bargaining agreement. The agreement has a three-step grievance procedure. The first step requires an employee to notify his immediate supervisor of the particular problem. If an unsatisfactory oral answer is received, step two permits the employee to file a written grievance to the department head, or designated representative, for a written answer. If an unsatisfactory written answer is received, step three requires the submission of a written grievance from the chairperson of his union bargaining committee to the university review committee for a hearing and a written answer. After a grievance has proceeded through the three-step procedure, the grievance may be submitted to arbitration. The plaintiff’s grievance went through the three-step procedure and was taken to arbitration. On April 23, 1987, the arbitrator issued a decision, finding that the plaintiff had operated his bus negligently but that discharge was not an appropriate remedy. The arbitrator ordered the plaintiff reinstated without back pay. While the plaintiff’s grievance was pending, in December 1986, the plaintiff filed a workers’ compensation petition, alleging that he was unable to work because of an "aggravated hernia condition, blood pressure and ulcer condition due to stress of job.” The plaintiff listed three doctors who had treated him for his condition, Dr. Person-Brown, Dr. Dew, and Dr. Strasius. On May 5, 1987, the defendant’s doctor, Dr. Stunz, examined the plaintiff and concluded that "[o]n the basis of my evaluation of this man’s hypertension, peptic ulcer disease and hiatus hernia, I do not believe he is disabled from performing any and all duties which might be involved in the performance of his job as a bus driver for the University of Michigan.” Following the examination by the defendant’s doctor, the plaintiff sought reinstatement by the university. On May 12, 1987, the university informed the plaintiff that he would have to submit a university physician’s statement from the three physicians listed on his workers’ compensation petition before he could return to work. The plaintiff submitted a release from Dr. Person-Brown, but not from the other two doctors. Although the defendant had successfully subpoenaed the records of Drs. Strasius and Dew, a further attempt by the plaintiff to be reinstated was again denied. As a result of this denial, the plaintiff filed another grievance on July 24, 1987, which resulted in a third-step hearing being held on August 6, 1987, and a decision being issued on September 18, 1987. The university review committee found that [t]he delays in assessing his ability to return to work are the result of his unwillingness to cooperate in providing the University with necessary medical information on his medical condition. There has been no violation of our Agreement. Therefore, this grievance and requested remedy are denied. On February 29, 1988, the plaintiff filed a complaint in the Court of Claims to enforce the April 23, 1987, arbitration award. The defendant filed a motion for summary disposition on the ground that the lawsuit was barred by a six-month limitation period. The plaintiff responded with two arguments: First, there was no statutory basis for the six-month period of limitation; and second, even if a six-month period of limitation applied, the lawsuit was brought within six months of the September 18, 1987, decision by the university review committee. The Court of Claims granted the defendant’s motion for summary disposition. The plaintiff filed a second complaint in the Court of Claims, alleging breach of contract, discrimination under the Workers’ Disability Compensation Act, discrimination under the Civil Rights Act, and wrongful discharge. The defendant responded with a motion for summary disposition, claiming that another action had been initiated involving the same parties and the same underlying claim. The court granted the defendant’s motion for summary disposition of the plaintiff’s second complaint. The plaintiff appealed both decisions. The Court of Appeals consolidated the appeals and affirmed the decision of the Court of Claims, relying on Walkerville Ed Ass’n v Walkerville Rural Communities School, 165 Mich App 341, 345; 418 NW2d 459 (1987). The plaintiff appealed in this Court, and we granted leave to appeal. 439 Mich 922 (1992). ii The dispositive issue before this Court is whether the plaintiff’s cause of action is barred by a six-month period of limitation. We hold that it is not. The labor-mediation act, MCL 423.1 et seq.; MSA 17.454(1) et seq., is intended to provide alternatives to resolve labor disputes through mediation and arbitration. The act provides procedures for parties to submit disputes to voluntary arbitration. After an arbitration award has been rendered, the award is "enforceable at law or in equity as the agreement of the parties.” Absent from the act is any express legislation that limits the period during which a party may enforce an arbitration award. Attempting to remedy the absence of a period of limitation, the Court of Appeals in Walkerville borrowed a six-month period from the public employees relations act (pera). Specifically, the Court of Appeals in Walkerville stated: An arbitration proceeding, being based on an agreement, is contractual in nature. Bay City School Dist [v Bay City, 425 Mich 426; 390 NW2d 159 (1986)]. The difficulty in this case arises because of MCL 423.9d; MSA 17.454(10.3), which, while allowing public labor disputes to be resolved by arbitration, does not specify a limitation period for enforcing the arbitration award. Rather, the award rendered "shall be enforceable at law or in equity as the agreement of the parties.” MCL 423.9d(4); MSA 17.454(10.3)(4). This requirement suggests that an arbitration award in the public sector should be subject to the six-year limitation period for contracts contained in the Revised Judicature Act, MCL 600.5807(8); MSA 27A.5807(8). This limitation period, although perhaps applicable under strict rules of statutory construction, appears to be an unduly lengthy period for enforcing an arbitration award. This is particularly so when viewed with the statutory declaration that the best interests of the people of this state are served by the prompt settlement of labor disputes. MCL 423.1; MSA 17.454(1). Similar policy considerations, under federal labor law, along with a consideration of competing interests affected by the limitation period, have led federal courts to adopt the six-month limitation period contained in § 10(b) of the National Labor Relations Act, 29 USC 160(b), for arbitration purposes. .See McCreedy v Local Union No 971, UAW, 809 F2d 1232 (CA 6, 1987). We conclude that the trial court did not err in adopting the six-month limitation period. A six-month period is part of pera; it effectuates the state’s express policy in favor of the prompt resolution of labor disputes in the public sector. Adoption of the six-month limitation period also contributes to statute of limitation uniformity. [Walkerville, p 345.] We disagree. By its terms, the pera limitation only applies to actions filed with the Michigan Employment Relations Commission. Additionally, the practice of applying statutes of limitation by analogy does not appear to be applicable in this case. Rather than seeking money damages for breach of contract, the plaintiff in this case seeks specific performance of the arbitration award that orders his reinstatement as an employee of the defendant. In Keys v Hopper, 270 Mich 504, 507; 259 NW 319 (1935), this Court recognized that "[a] suit for the specific performance of a contract [is] a purely equitable remedy . . . .” (Citation omitted.) As this Court stated in Lothian v Detroit, 414 Mich 160, 170; 324 NW2d 9 (1982), [C]ourts traditionally have not bent to the strictures of a statute of limitations where the law does not supply relief analogous to that afforded in equity. Thus, it is said that . . . "where the relief sought is in its nature one of equitable and not of legal cognizance, and the remedy is of a purely equitable nature, equity follows its own rules,” Michigan Ins Co [v Brown, 11 Mich 265, 272 (1863).] Consequently, we find that the Court of Appeals erred in applying the pera six-month period of limitation "by analogy” in this case. iii We do not suggest that an arbitration award can be enforced without limitation. We find two time limitations applicable to the enforcement of arbitration awards. The first time restriction applicable to the enforcement of an arbitration award is the six-year period of limitation for breach of contract. As this Court has previously recognized, arbitration is a matter of contract. It is the agreement that dictates the authority of the arbitrators and the disputes to be resolved through arbitration. In this case, the arbitration agreement provides that "[t]he arbitrator’s decision when made in accordance with his/her jurisdiction and authority established by this Agreement, shall be final and binding upon the University, the Union, and the employee or employees.” The university has never challenged the authority of the arbitrator to resolve this labor dispute. Therefore, the university’s alleged failure to comply with the arbitrator’s decision would constitute a breach of that contractual provision and would be subject to the six-year limitation period for breach of contract. The second time restriction applicable to this case is the equitable doctrine of laches. As previously noted, the plaintiff is seeking specific performance of his arbitration award and specific performance is a "purely equitable remedy.” In defining the scope of the various limitation periods contained in the Revised Judicature Act, MCL 600.5815; MSA 27A.5815 provides: The prescribed period of limitations shall apply equally to all actions whether equitable or legal relief is sought. The equitable doctrine of laches shall also apply in actions where equitable relief is sought. [Emphasis added.] In the context of this case, we interpret this statutory provision to require all actions seeking judicial enforcement of arbitration awards to be commenced within six years after the award is granted. Where the award purports to grant relief that is traditionally equitable in nature, the equitable doctrine of laches also applies, requiring the exercise of due diligence to ensure the timely prosecution of the plaintiif’s claim to avoid unduly prejudicing the defendant. While we find authority for this approach in MCL 600.5815; MSA 27A.5815, we note that this Court had previously recognized that laches can operate to cut short a statutory limitation period when equitable relief is sought. In Olson v Williams, 185 Mich 294, 301; 151 NW 1043 (1915), this Court stated: The omission to do what one is by law required to do to protect his rights, and which justifies a fair presumption that he has abandoned the same, under circumstances which misled or prejudiced an adverse party, may in equity operate as laches which bar[s] the assertion of such right later under changed conditions, even though the statute of limitations has not run. IV We hold that a plaintiif ordinarily has six years to seek enforcement of an arbitration award. We also recognize that in certain cases this time period may be substantially diminished if a plaintiff’s arbitration award grants equitable relief and a delay in its enforcement is shown to prejudice the defendant in a way that evokes laches to bar the plaintiff’s claim. In failing to raise laches in its responsive pleadings or by motion, the defendant has waived this affirmative defense. As a result of this waiver, the plaintiff’s claim in this case is governed solely by the six-year period of limitation applicable to a breach of contract. Because the plaintiff filed his complaint with the Court of Claims well within this six-year period, the plaintiff is entitled to seek enforcement of his arbitration award. Accordingly, we reverse the judgments of the lower courts, and we remand this matter to the trial court for further proceedings consistent with this opinion. Levin, Brickley, and Mallett, JJ., concurred with Cavanagh, C.J. MCR 2.116(C)(6). MCL 423.9d; MSA 17.454(10.3). MCL 423.9d(4); MSA 17.454(10.3X4). See MCL 423.216(a); MSA 17.455(16)(a). MCL 423.216(a); MSA 17.455(16)(a) provides: Whenever it is charged tha
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