Wrongful Termination Cases
6,866 employment law court rulings from public federal records (1863–2026)
About Wrongful Termination Claims
Wrongful termination claims arise when an employee is fired in violation of federal or state law, public policy, or an employment contract. While most employment is at-will, employers cannot terminate employees for illegal reasons such as discrimination, retaliation, or exercising legal rights. These cases examine whether the stated reason for termination was pretextual.
Case Outcomes
Top Employers in Wrongful Termination Cases
Employers most frequently appearing in wrongful termination rulings.
Court Rulings (6,866)
HEURTEBISE v RELIABLE BUSINESS COMPUTERS, INC Docket No. 102019. Argued April 10, 1996 (Calendar No. 5). Decided July 16, 1996. Rehearing denied 453 Mich 1204. Theresa Heurtebise brought an action in the Wayne Circuit Court against Rehable Business Computers, Inc., alleging unlawful termination of her employment because of gender discrimination in violation of the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq. The court, Cynthia D. Stephens, J., denied the defendant’s motion to compel arbitration and to stay the proceedings, finding that the arbitration agreement signed by the plaintiff was against public policy. The Court of Appeals, Neff, P.J., and McDonald and M. Warshawsky, JJ., reversed in an opinion per curiam, finding no public policy prohibition against the enforcement of a valid arbitration agreement that provides for meaningful arbitration in matters involving civil rights questions, and determined that arbitration does not impair the remedies afforded under the statute (Docket No. 152041). The plaintiff appeals. In separate opinions, the Supreme Court unanimously held: An arbitration provision is unenforceable if it is not a binding contract. The opening statement of the defendant’s handbook demonstrates that the defendant did not intend to be bound to any provision contained in the handbook. Consequently, the handbook did not create an enforceable arbitration agreement with respect to this dispute. Thus, the defendant was not entitled to summary disposition. Justice Cavanagh, joined by Justices Levin and Mallett, additionally stated that the Michigan Constitution and longstanding public policy preclude private employers from requiring their employees, as a condition of employment, to waive prospectively the right to pursue civil rights claims in a judicial forum. Rights secured by the Michigan Civil Rights Act are nonnegotiable state rights that apply to all employees and cannot be waived or conditioned. The Michigan Constitution expressly prohibits exhaustion of administrative remedies for civil rights claims. In addition, the Legislature has underscored this policy by expressly prohibiting an exhaustion of administrative remedies requirement. In creating the Civil Rights Commission, Const 1963, art 5, § 29 did not diminish the right of any party to direct and immediate legal or equitable remedies in the courts, and it was intended that the role of the judiciary in enforcing civil rights was to remain supreme. As the scope of equal protection expanded, the private right to judicial remedies, whether expressly provided by statute or inferred by the judiciary, was always included. The Legislature has done nothing to impair or restrict an aggrieved person’s access to judicial remedies, nor could it. The judicial remedies provision of Const 1963, art 5, § 29, along with the tone of the constitutional debates that produced the provision, reveal that an aggrieved person’s direct access to a judicial forum is so interwoven with the enforcement of substantive civil rights in Michigan that they cannot be separated without potentially harming substantive civil rights. Public policy favoring arbitration can be outweighed by contrary constitutional or legislative intent. Reversed and remanded. 207 ¡Mich App 308; 523 NW2d 904 (1994) reversed. Goodman, Eden, Millender & Bedrosian (by Christopher R. Holliday and Julia Sherwin) for the plaintiff. Shapack, McCullough & Ranter, RC. (by Alan M. Ranter, Michael R. Shpiece, and Michael L. Getter), and Walton & Stafford, P.C. (by Jonathan T. Walton, Jr., and Laura S. Stafford), for the defendant. Amici Curiae: Frank J. Relley, Attorney General, Thomas L. Casey, Solicitor General, and Rebekah F. Visconti, Assistant Attorney General, for Michigan Civil Rights Commission and Michigan Department of Civil Rights. Stewart R. Hakola and Gayle C. Rosen for the Michigan Protection & Advocacy Service. Sachs, Waldman, O’Hare, Helveston, Bogas & McIntosh, P.C. (by Mary Ratherine Norton and Elizabeth A. Cabot), for Michigan State AFL-CIO, International Union UAW, National Employment Lawyers Association, and Michigan Employment Lawyers Association. Jeanne M. VanderHeide and Jeanne Mirer for National Lawyers Guild, Detroit Chapter. Stark & Gordon (by Sheldon J. Stark and Carol A. Laughbaum) for the Association of Trial Lawyers of America, Michigan Trial Lawyers Association, American Civil Liberties Union of Michigan, and Wolverine Bar Association. Clark, Hill, P.L.C. (by Duane L. Tamacki, J. Walker Henry, and Patricia S. Bordman), for Michigan Manufacturers Association. Amberg, McNenly, Zuschlag, Firestone & Lee, PC. (by Joseph H. Firestone), for Michigan Education Association. Vercruysse, Metz & Murray (by Diane M. Soubly and David B. Calzone) for American Society of Employers, American Automobile Manufacturers Association, Greater Detroit Chamber of Commerce, and Michigan Chamber of Commerce. Cavanagh, J. We are asked in this case to address whether the instant parties have created a binding arbitration agreement with respect to employment discrimination claims accruing subsequent to such an agreement. If yes, then we would need to address whether such agreements between employers and employees, entered into as a condition of employment, violate public policy in Michigan. We hold that no binding agreement was created in this case. Consequently, a majority of this Court declines to address the second issue. However, I would further hold that the public policy against discrimination in Michigan precludes enforcement of prospective waivers in employment contracts of a judicial forum for civil rights claims. Before turning to the matter at hand, we thank all the amici curiae who filed briefs for assisting us in resolving the issues. i This case is at the summary disposition stage. In November 1991, the plaintiff, Theresa Heurtebise, filed suit against the defendant, Reliable Business Computers, alleging that she had been unlawfully terminated from her employment in violation of the Michigan Civil Rights Act. MCL 37.2101 et seq.\ MSA 3.548(101) et seq. The plaintiff alleged that she had been hired in May 1989 to perfomi computer software support work. She further alleged that she and a coworker, who was male, often took lunches that lasted longer than the company’s established one-hour period, while working together on a project. Additionally, she alleged that on July 20, 1990, the plaintiff and this male co-worker returned from a working lunch that had lasted longer than one hour. The plaintiff alleged that she was terminated, while her male co-worker was not. The plaintiff argued that this was unlawful gender discrimination and sought money damages. In response, the defendant brought a motion to dismiss, pursuant to MCR 2.116(C)(4) (lack of subject matter jurisdiction), or, alternatively, to compel arbitration and to stay proceedings, pursuant to MCR 3.602. The defendant relied on a written acknowledgment signed by the plaintiff and dated May 25, 1989, which stated that she had received the defendant’s employee handbook and that she had agreed to be bound by its terms and policies. The handbook provided an internal review mechanism for disputes with respect to dismissals. In addition, it provided that all disputes involving money damages would go to final and binding arbitration. The trial court denied the defendant’s alternative motions. It refused to enforce the arbitration agreement on the grounds that it was against public policy and that other clauses in the handbook made the arbitration provision ambiguous. The Court of Appeals reversed. 207 Mich App 308; 523 NW2d 904 (1994). It reasoned: The trial court appears to have denied defendant’s motion in part because it found there was no “meeting of the minds” between plaintiff and defendant with regard to the arbitration clause. The record does not support such a finding. Before beginning employment, plaintiff signed an acknowledgment form that stated that she agreed to conform to the various procedures, rules, and regulations of the company as set forth in the handbook. Moreover, even were the record devoid of plaintiff’s express acceptance of the handbook’s provisions, it is well established under Michigan law that mutual assent to a term of employment is not required. In re Certified Question, 432 Mich 438; 443 NW2d 112 (1989); Carlson v Hutzel Corp of Michigan, 183 Mich App 508; 455 NW2d 335 (1990); Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980).11 Plaintiff’s argument that the handbook specifically states that it does not create an enforceable contract is misguided. The provision plaintiff relies on addresses the at-will nature of plaintiff’s employment, not the handbook in its entirety. Finally, we find no “public policy” prohibition against the enforcement of a valid arbitration agreement that provides for meaningful arbitration in matters involving civil rights questions. See Gilmer v Interstate/Johnson Lane Corp, 500 US 20; 111 S Ct 1647; 114 L Ed 2d 26 (1991). To the contrary, arbitration has long been a favorable method of dispute resolution. Detroit v AW Kutsche & Co, 309 Mich 700; 16 NW2d 128 (1944). Thus, arbitration clauses are to be liberally construed with any doubts to be resolved in favor of arbitration. Chippewa Valley Schools v Hill, 62 Mich App 116; 233 NW2d 208 (1975). Contrary to plaintiff’s suggestion, arbitration of plaintiff’s claims will not result in the loss of her rights under the Civil Eights Act, but, instead, merely constitutes enforcement of an agreement to have those rights determined in a different forum. Arbitration does not impair the remedies afforded under the statute. [207 Mich App 310-311.] We granted leave to the plaintiffs appeal. 450 Mich 963 (1995). We note that the entire handbook was not presented to the trial court or to the Court of Appeals. After oral argument, we granted the plaintiffs motion to expand the record to include the entire handbook. It is seventy-one pages long and covers a broad scope of subjects.* The expanded record reveals that the handbook included an anti-discrimination policy statement. In the introduction on page 2, the handbook further reserved in the defendant the right to modify any policy contained in the handbook “at its sole discretion.” n We turn first to whether the parties are bound by a valid arbitration agreement. It is undisputed that an arbitration provision is unenforceable if it is not a binding contract. The opening statement in the handbook provides: This document is intended to establish and clarity certain employment policies, practices, rules and regulations (hereinafter collectively referred to as “Policies”) of Reliable Business Computers, Inc., (hereinafter referred to as the “company”). Except as may otherwise be provided, the Policies will apply to all company employees, and it is each employee’s responsibility to assure that his/her own conduct is in conformity with those Policies. It is important to recognize and clarify that the Policies specified herein do not create any employment or personal contract, express or implied, nor is it intended nor expected that the information provided in this document will provide sufficient detail to answer any and all questions which may arise. Notwithstanding any of the specific policies herein, each EMPLOYEE HAS THE ABSOLUTE RIGHT TO TERMINATE HIS/HER OWN EMPLOYMENT AT ANY TIME, WITHOUT NOTICE, AND FOR ANY REASON WHATSOEVER, AND THE COMPANY HAS THE SAME RIGHT. From time to time, the company specifically reserves the right, and may make modifications to any or all of the Policies herein, at its sole discretion, and as future conditions may warrant. In the event employees have any questions relative to any of the Policies, they are urged to contact their supervisor for clarification purposes. New employees will receive a copy of this document at the time of formal hire. Upon receipt, all employees will sign the Employee Acknowledgement, acknowledging receipt of this document. [Emphasis added.] This demonstrates that the defendant did not intend to be bound to any provision contained in the handbook. Consequently, we hold that the handbook has not created an enforceable arbitration agreement with respect to this dispute. We note that the above opening statement was not part of the record before the Court of Appeals. Had the Court of Appeals been able to examine the entire handbook, we are confident that it would have reached the same conclusion. We hold that the defendant was not entitled to summary disposition. in Although a majority of this Court saves the public policy issue for another day, because the Court of Appeals addressed it, I believe that we should decide it as well. Therefore, I turn now to the issue whether private employers can require employees, as a condition of employment, to waive prospectively their right to pursue civil rights claims in a judicial forum. As I will demonstrate, Michigan has a long history of stalwartly defending individuals from invidious discrimination in their pursuit of basic civil liberties, such as equal opportunity in the pursuit of employment. Unlike federal law, Michigan also has an unwavering history of faithfully defending an aggrieved individual’s right to a judicial forum to remedy unlawful discrimination. The defendant relies on federal title VII and age discrimination (adea) case law. However, it is axiomatic that even under federal law, “an employee may not prospectively waive his or her rights under either Title VII or the ADEA.” Adams v Philip Morris, Inc, 67 F3d 580, 584 (CA 6, 1995). Likewise, we have held that the rights secured by the Michigan Civil Rights Act are “nonnegotiable state rights.” Betty v Brooks & Perkins, 446 Mich 270, 282; 521 NW2d 518 (1994). “These are rights that apply to all employees, whether or not they belong to a union. Such rights cannot be waived or conditioned on success at the bargaining table.” Id. The defendant and its amici curiae would have us believe that the only interest at stake in enforcing a prospective arbitration agreement is the parties’ choice of forum in which an aggrieved party may pursue statutory remedies. We should decide whether a prospective waiver of an aggrieved individual’s right to a judicial forum, which is required of the employee as a condition of employment, comports with Michigan public policy as reflected in our constitution, civil rights statute, and case law. The issue before us would be one of first impression. There are several layers of considerations that I will address. First, I will briefly review the prevailing precedent with respect to federal discrimination claims. Second, I will consider whether Michigan civil rights law is substantially similar to federal anti-discrimination law or whether it is materially different with respect to an aggrieved individual’s access to a judicial forum. I will then trace the role of an aggrieved individual’s access to a judicial forum in the development of Michigan civil rights law to determine whether Michigan public policy precludes the enforcement of prospective arbitration agreements in employment contracts with respect to statutory civil rights claims. FEDERAL DISCRIMINATION CLAIMS The Court of Appeals relied on Gilmer, supra, in holding that public policy did not prevent the enforcement of a valid prospective arbitration agreement. 207 Mich App 311. In 1991, the Gilmer Court held that a broadly worded arbitration clause in a securities registration form, which is often referred to as a stockbroker U-4 form, covered an adea claim. In doing so, the Court found that the Federal Arbitration Act (faa) applied and that it evidenced a “ ‘liberal federal policy favoring arbitration agreements.’ ” Id. at 25 (citation omitted). However, the faa expressly excludes from coverage “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 USC l. Referencing this clause, Gilmer expressly did not decide what the result would be if the arbitration clause had been contained in an employment contract. Id. at 25, n 2. Gilmer also distinguished a trilogy of cases that had arisen in the collective bargaining setting: Alexander v Gardner-Denver Co, 415 US 36; 94 S Ct 1011; 39 L Ed 2d 147 (1974) (title VII claim), Barrentine v Arkansas-Best Freight System, Inc, 450 US 728; 101 S Ct 1437; 67 L Ed 2d 641 (1981) (right to minimum wage claim under the Fair Labor Standards Act), and McDonald v West Branch, 466 US 284; 104 S Ct 1799; 80 L Ed 2d 302 (1984) (42 USC 1983 claim). Following Gilmer, there has been a lot of appellate activity involving the applicability of prospective arbitration agreements to federal discrimination claims. Although there remain many unanswered questions in Gilmer’s wake, two general rules have emerged. First, an arbitration clause in a collective bargaining agreement does not extend to federal statutory claims of discrimination. E.g., Pike v Burlington Northern R Co, 273 Mont 390, __; 903 P2d 1352, 1357 (1995). One overriding rationale for this rule is that civil rights are individual personal rights, while union bargaining representatives act for the benefit of the group. The apparent “tension between collective representation and individual statutory rights” led the Court in the Alexander line of cases to protect the rights of the individual employee by not enforcing arbitration agreements in collective bargaining agreements with respect to claims of unlawful discrimination. Gilmer, 500 US 35. The second rule is that an arbitration clause in a stockbroker U-4 form does extend to title VII claims, in addition to adea claims. Bender v AG Edwards & Sons, Inc, 971 F2d 698 (CA 11, 1992); Alford v Dean Witter Reynolds, Inc (On Remand), 939 F2d 229 (CA 5, 1991). The defendant cites numerous cases for the proposition that prospective arbitration agreements in individual employment contracts have been enforced with respect to federal and state discrimination claims. However, those cited cases arose under the faa or were not ordinary employment contracts. I have found other cases that have distinguished the contract at issue, such as a stockbroker u-4 form, as not being an employment contract. Willis v Dean Witter Reynolds, Inc, 948 F2d 305, 312 (CA 6, 1991); Alford, 939 F2d 230, n * (“[cjourts should be mindful of this potential issue in future cases”). On the basis of the fact that the Gilmer Court expressly distinguished employment contracts, id. at 25, n 2, and because many subsequent cases have continued that distinction, I would find that the cases upholding prospective arbitration agreements in stockbroker u-4 forms, including Gilmer, are not on point in the case at hand because they did not concern ordinary employment contracts. Hence, I would find that there remains a conflict among courts regarding whether arbitration agreements in individually negotiated employment contracts are enforceable under the FAA with respect to claims of unlawful discrimination. In any event, the defendant has not argued that the instant case is controlled by the FAA. Therefore, even if prospective arbitration agreements in individually negotiated employment contracts are enforceable with respect to federal and other state discrimination claims when the FAA does apply, such cases would not necessarily apply here. TITLE VH AND ADEA DISTINGUISHED FROM THE MICHIGAN CIVIL RIGHTS ACT Even though we often look to title VII precedent in interpreting our own civil rights statute, we decline to do so when the Michigan statute provides greater protection to victims of discriminatory actions than title VII provides. Title VII requires claimants to exhaust administrative remedies with the Equal Employment Opportunity Commission (eeoc) before pursuing judicial relief. Likewise, the ADEA requires an aggrieved individual to seek relief first with the E
Mary C. O’Brien vs. New England Telephone & Telegraph Company & another. Hampden. December 5, 1995. May 17, 1996. Present: Liacos, C.J., Wilkins, Abrams, Lynch, O’Connor, & Fried, JJ. Employment, Termination, Personnel manual. Contract, Employment, Interference with contractual relations. Labor, Grievance procedure. Damages, Attorney’s fees. Practice, Civil, Attorney’s fees, Costs. Evidence in a civil action warranted a finding that the defendant unlawfully and intentionally interfered with the plaintiffs employment relationship, that the defendant’s conduct towards the plaintiff was motivated by actual malice unrelated to the employer’s legitimate corporate interests and that the defendant’s treatment of the plaintiff caused her to commit the misconduct that led to her discharge. [687-688, 690] Discussion of the holdings of Jackson v. Action for Boston Community Development, Inc., 403 Mass. 8 (1988), and of cases from other jurisdictions, considering whether the terms of a personnel manual are part of an express or implied employment contract. [690-694] In the circumstances of an employer-employee relationship, the employer’s personnel manual, distributed to employees from time to time and which . contained no reservation of rights or disclaimer of obligations, granted the employee rights beyond those of an at-will employee, specifically with respect to rights under the disciplinary procedures set forth therein. [694-695] An employee who did not follow an applicable grievance procedure set forth in her employer’s personnel manual was not entitled to maintain an action against the employer for wrongful termination of employment, asserting a right under the personnel manual against unfair treatment. [695-696] A plaintiff who prevailed on a claim for intentional interference with her contractual relations with her employer was not entitled to an award of attorney’s fees and costs in pressing that claim; nor was that defendant, in the circumstances, liable for counsel fees incurred by the plaintiff in pursuing a contract claim against the employer, where the plaintiff had had another remedy and did not demonstrate that she was required to bring the action against the employer to vindicate her rights. [696-697] Civil action commenced in the Superior Court Department on March 2, 1990. The case was tried before Constance M. Sweeney, J. The Supreme Judicial Court granted an application for direct appellate review. Pamela A. Smith for the defendants. Edward J. McDonough, Jr. (William C. Flanagan with him) for the plaintiff. Stephen S. Ostrach, for New England Legal Foundation, amicus curiae, submitted a brief. Edwin H. Hurley, Jr. Wilkins, J. Mary C. O’Brien was awarded judgment against Edwin H. Hurley, Jr., for intentional interference with her contractual relations with her employer, New England Telephone & Telegraph Company (NET). She was also awarded judgment against NET for wrongful termination of her implied contract of employment. We allowed the defendants’ application for direct appellate review. Hurley, who was O’Brien’s supervisor in NET’S marketing department in Springfield, argues that the judge should not have submitted the claim against him to the jury. We shall determine that the jury could reasonably have concluded that Hurley’s treatment of O’Brien maliciously interfered with O’Brien’s rights and precipitated her discharge. Although NET contends that O’Brien was only an at-will employee and, therefore, could be discharged without cause, we shall conclude that NET’S personnel manual granted O’Brien rights beyond those of an at-will employee. Those rights, however, had to be asserted first through the grievance procedure set forth in the manual. Because O’Brien did not pursue that course, she lost whatever rights that the personnel manual provided her. Judgment must be entered in favor of NET. We shall first explain why the verdict against Hurley for intentional interference with contractual relations should be upheld. Next, we shall explain why O’Brien may not recover against NET. 1. We reject Hurley’s argument that the evidence did not warrant a finding that he unlawfully and intentionally interfered with O’Brien’s employment relationship. We have little difficulty in concluding that the jury were warranted in finding that Hurley’s conduct toward O’Brien was motivated by “actual malice” and was not related to NET’s legitimate corporate interests. See Wright v. Shriners Hosp. for Crippled Children, 412 Mass. 469, 476 (1992); Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 663-664 (1981), S.C., 391 Mass. 333 (1984). Although the question is a closer one, the jury were also warranted in finding that Hurley’s treatment of O’Brien caused her to commit the misconduct that led to her discharge. The jury could have found the following facts. O’Brien first went to work for NET in 1956 as a general clerk in the division traffic office in Springfield, where she worked for twenty-two years, had a good relationship with fellow workers, and was never reprimanded or disciplined. Thereafter she worked in two other NET departments without adverse incident. In December, 1982, she joined the marketing department headed by Hurley. In 1983, Hurley rated O’Brien’s performance as satisfactory in an evaluation, although he indicated that she could use her time more effectively. In 1984, Hurley asked O’Brien to fill out a transfer form because there was a surplus of clerks in the department, and he wanted her to be transferred. O’Brien, who believed that her seniority would protect her from being transferred against her will, refused Hurley’s request and filed a grievance. A NET personnel manager upheld the grievance on the basis that the terms of NET’s personnel manual protected O’Brien from involuntary transfer in the circumstances. After O’Brien’s grievance was upheld, Hurley became very hostile toward O’Brien. He screamed and yelled at her over small things every day, often in front of other people in the office. He called her stupid, the “nitwit in the north end,” “the Blessed Mother,” and “loony tunes.” A witness heard Hurley scream at O’Brien and call her a “whore,” “prostitute,” and “slut.” He described Hurley’s outbursts toward O’Brien as temper tantrums. One could hear Hurley yelling at her all over the building. Hurley would persist until O’Brien started shaking and crying. When Hurley made O’Brien cry, “that was like his victory.” Hurley wanted O’Brien out of the department. He gave her work to other people and refused to let her do work that she had been trained to do. He also refused to give her a key to the supply closet to obtain supplies, although the junior clerk was given a key, and, in the past, O’Brien always had been given access. Hurley refused to discuss with O’Brien why he had ceased to give her work. In his performance evaluation of O’Brien in 1985, after she had successfully grieved the attempted transfer, Hurley reported that O’Brien’s performance was “unsatisfactory” and that she “has been told of her deficiencies. Her overall skills do not let her perform in a satisfactory manner.” He also reported that “she procrastinates, is unable to prioritize, needs constant direction, and is much too deliberate in her duties.” O’Brien refused to sign this evaluation. One day in October, 1985, while O’Brien was typing her notes regarding her relationship with Hurley, pursuant to a direction by a NET personnel manager, Hurley came out of his office, took her notes (which she seized back), and told her to leave and to leave everything on her desk. Hurley suspended O’Brien for three days without pay. Upon her grievance of the suspension, a NET personnel manager rescinded the three-day suspension; changed the discipline to one day off without pay; ordered that the discipline letter be rewritten to eliminate any reference to a suspension; and promised O’Brien that all memos and correspondence regarding the suspension would be removed from her file. In 1987, after O’Brien had obtained payroll training, Hurley refused to give her any opportunity to practice doing the payroll work. One time when he asked her to do the payroll he yelled at her because she expressed some concern about her lack of practice. When she grieved this issue, Hurley was directed to allow O’Brien to do the payroll occasionally so she could get some practice. Hurley did not fully comply with this directive. Hurley’s harassment of O’Brien continued. Some days O’Brien had no work to do. Hurley gave secretarial work to a salesperson in the department who was not a clerk. Toward the end of 1989, O’Brien believed that Hurley and the salesperson were spending time together and confirmed her suspicions by making telephone calls to Hurley’s office, to his home, to the salesperson’s office, and once to her home. O’Brien never said anything during any of the telephone calls. She simply hung up. O’Brien was concerned that the salesperson was taking over her job. At Hurley’s request, NET traced the “hang-up calls” to O’Brien. She admitted making them and that it was wrong to do so. She was immediately suspended. About one week later, NET terminated her employment on the stated ground that annoyance calls were a violation of criminal laws and a violation of NET’s Code of Business Conduct. O’Brien did not file a grievance concerning her termination. Although Hurley argues that his treatment of O’Brien was consistent with his supervisory responsibilities, the jury were warranted in finding that Hurley’s conduct exceeded his rightful role as O’Brien’s supervisor and was prompted by his resentment of O’Brien’s successful challenges to his decisions and her refusal to transfer out of his department. Screaming at an employee repeatedly to humiliate her in front of other employees, calling her names, and denying her work to do when work is available could be found both to exceed the protected conduct of a supervisor and to constitute malicious conduct unrelated to an employer’s legitimate business interests. Hurley has suggested in his brief that the jury could not reasonably have found that his treatment of O’Brien caused her to make the “hang-up” telephone calls that caused NET to discharge her. Certainly a finding was warranted that O’Brien would not have made the “hang-up” telephone calls if Hurley had not treated her as he did. 2. Next, we come to O’Brien’s claim that NET violated her contract of employment by discharging her without cause. O’Brien, who had no written contract, was an at-will employee unless the provisions of NET’s personnel manual, entitled “Personnel Practices,” altered her status. There was nothing in O’Brien’s other dealings with NET that gave her greater rights than those that we conclude she had under NET’s personnel manual. O’Brien contended at trial that NET’s personnel manual provided her protection from dismissal without cause. NET, in turn, argued that, because the manual granted O’Brien no enforceable rights, there was no jury issue as to whether NET had cause to discharge O’Brien. NET also contended that, even if the manual did grant O’Brien contractual rights, O’Brien’s claim also failed because (1) she did not pursue the grievance procedures of the personnel manual and (2) in any event, O’Brien’s admittedly improper conduct provided just cause for her discharge. We conclude that NET’s motion for a directed verdict (or at least its motion for judgment notwithstanding the verdict) should have been allowed. The principle that promises made in a personnel manual may be binding on an employer is accepted in a clear majority of American jurisdictions. See Comment, Unilateral Modification of Employment Handbooks: Further Encroachments on the Employment-at-Will Doctrine, 139 U. Pa. L. Rev. 197, 208-209 n.76 (1990) (citing cases from thirty-three States and the District of Columbia). There are differences among the States as to the theory of liability (unilateral contract or promissory estoppel), id. at 209, and there are differences as to what circumstances justify a finding that the provisions of a personnel manual are binding on an employer. The idea that an employer may ignore promises made in a personnel manual is in increasing disfavor in this country. See Small v. Spring Indus., Inc., 292 S.C. 481, 485-486 (1987). Since our opinion in Jackson v. Action for Boston Community Development, Inc., 403 Mass. 8 (1988), in which we last considered the question of personnel manuals, some confusion has arisen. In that opinion, we held that the summary judgment evidence demonstrated that the parties had not entered into an implied contract on the basis of a personnel manual that the defendant employer had distributed to its employees. Id. at 14. Principles stated in the Jackson opinion remain sound. A personnel manual may form the basis for an express contract. Id. at 13. Surely, if the parties agree in advance of employment that a personnel manual will set forth relative rights and obligations of employer and employee, the manual becomes part of the employment contract. A similar result would be obtained if, during the course of at-will employment, the parties agree, orally or in writing, that thereafter their rights and obligations would include the provisions of an employee manual. An employee remaining with the employer after receiving a manual provides the consideration necessary to support the contract. Id. at 14. It is also apparent that the circumstances of a particular employment relationship could warrant a finding of an implied contract that includes the terms of a personnel manual. Id. If an employer adheres to the procedures set forth in its manual, that would be some evidence that the terms of the manual were part of the employment contract. Id. The Jackson opinion has led to confusion because certain facts that were stated to be present or not present in that case (id. at 14-15) have been viewed as constituting a list of conditions that must exist in order to justify a ruling that the terms of a personnel manual are part of an express or implied employment contract. See Pearson v. John Hancock Mut. Life Ins. Co., 979 F.2d 254, 256-257 (1st Cir. 1992); Biggins v. Hazen Paper Co., 953 F.2d 1405, 1423-1424 (1st Cir. 1992), vacated on other grounds, 507 U.S. 604 (1993); Cadrin v. New England Tel. & Tel. Co., 828 F. Supp. 120, 122 (D. Mass. 1993). Cf. O’Brien v. Analog Devices, Inc., 34 Mass. App. Ct. 905, 906 (1993) (manual played no part in employment agreement because employee did not read manual until after she began her employment); Mullen v. Ludlow Hosp. Soc’y, 32 Mass. App. Ct. 968, 969 (1992) (no contract because terms of manual were not negotiated, manual was received after employee began working, employer could change manual unilaterally, and manual said it was not a contract). The various circumstances discussed in the Jackson opinion are not a rigid list of prerequisites, but rather explain factors that would make a difference or might make a difference in deciding whether the terms of a personnel manual were at least impliedly part of an employment contract. For example, one of the Jackson factors is whether there had been negotiations over the terms of the personnel manual. Jackson, supra at 15. If there had been negotiations leading to an agreement, that fact alone would justify the conclusion that more than an at-will employment contract existed. The fact that the NET manual was not the subject of negotiation is neither significant nor surprising. Negotiation of the terms of a company-wide manual for nonunion employees is not likely and is not an essential precondition of the enforceability of the employer’s obligations stated in the manual. Of course, if a manual furnished to an employee stated a term of employment, the employee would not be an at-will employee. Id. The Jackson opinion thought significant, in support of its result, that the employer retained the right unilaterally to modify the terms of the manual because that made any offer in the manual illusory. Id. at 14-15. On the other hand, if an employee reasonably believed that the employer was offering to continue the employee’s employment on the terms stated in the manual, the employee’s continuing to work after receipt of the manual would be in the nature of an acceptance of an offer of a unilateral contract (see Pine River State Bank v. Mettille, 333 N.W.2d 622, 626-627 [Minn. 1983]), and the promise would not be illusory. The fact that the employer did not intend to make such an offer, and that there was no explicitly bargained-for exchange, does not matter if employees in general would reasonably conclude that the employer was presenting the manual as a statement of the conditions under which employment would continue. See Restatement (Second) of Contracts § 24 (1979) (“An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it”). The Jackson opinion also indicates that a finding that the terms of a personnel manual are part of an employee’s contract would be supported if the employee signed the manual, manifested assent to it, or acknowledged understanding of its terms, or if the employer called special attention to the manual. Jackson, supra at 15. Although O’Brien did not sign the personnel manual (the document that contains whatever contractual rights that she may have beyond those of an at-will employee), there was evidence that she received a new copy of the manual annually. Of course, the provisions of a personnel manual on analysis may grant no rights. The Jackson opinion noted that, if the manual states that it provides only guidance as to the employer’s policies (id.), it may not create any enforceable rights. Other language in the manual or employment practices may demonstrate otherwise. The NET manual of personnel practices states that it applies to all nonmanagement employees not covered by collective bargaining agreements. In no place does it state that NET reserves the right unilaterally to change the provisions of the manual or to discharge any employee without cause. It does, however, provide more than general guidance as to the employer’s policies. Management distributes personnel manuals because it is thought to be in its best interests to do so. Such a practice encourages employee security, satisfaction, and loyalty and a sense that every employee will be treated fairly and equally. See Toussaint v. Blue Cross & Blue Shield of Mich., 408 Mich. 579, 613 (1980). Management expects that employees will adhere to the obligations that the manual sets forth. Courts recently have been reluctant to permit management to reap the benefits of a personnel manual and at the same time avoid promises freely made in the manual that employees reasonably believed were part of their arrangement with the employer. Management voluntarily offers, and defines the terms of, any benefit set forth in its unbargained for personnel manual. The employees may have a reasonable expectancy that management will adhere to a manual’s provisions. “Without minimizing the importance of its specific provisions, the context of the manual’s preparation and distribution is, to us, the most persuasive proof that it would be almost inevitable for an employee to regard it as a binding commitment, legally enforceable, concerning the terms and conditions of his employment.” Woolley v. Hoffmann-La Roche, Inc., 99 N.J. 284, 299, modified on other grounds, 101 N.J. 10 (1985). In the circumstances of this case, an affected employee’s reliance on the manual would be reasonable, and O’Brien, as one of those employees, is entitled to whatever rights that the manual sets forth. We need not now define the extent to which management may effectively reserve its right to change or withdraw a manual, or some part of it, or the extent to which management may successful
GORTNEY v NORFOLK & WESTERN RAILWAY COMPANY Docket No. 173244. Submitted March 13,1996, at Detroit. Decided May 10, 1996, at 9:20 A.M. Eileen J. Gortney, as personal representative of the estate of Justine T. Gomey, Jr., brought an action in the Wayne Circuit Court against the Norfolk & Western Railway Company, seeking damages under the Federal Employers’ Liability Act (pela), 45 USC 51 et seq., and alleging that the decedent’s death from cancer had resulted from occupational exposure to diesel fumes while he had been in the employ of the defendant. The defendant moved for summary disposition on the basis of a release executed by the decedent and on the basis of the operation of the applicable statute of limitations. The court, Kathleen I. MacDonald, J., granted summary disposition for the defendant on the basis that the release, which was part of a resignation and release agreement that had been executed by the decedent for consideration in acceptance of an offer of early retirement, released the defendant from its liability under the pela. The plaintiff appealed, and the defendant cross appealed. The Court of Appeals held: 1. Under both state and federal law, the scope of a release is controlled by the intent of the parties as it is expressed in the release. If the language of the release is unambiguous, the intent of the parties is ascertained from the plain and ordinary meaning of the release. 2. The language of the release executed by the plaintiff’s decedent evidences a clear intent to settle and release any claim, action, or cause of action of any kind that the decedent had or could have had against the defendant as a result of his employment with the defendant. Accordingly, the trial court correctly ruled that the decedent’s release was intended to release the defendant from all personal injury actions that arose during the course of the decedent’s employment with the defendant. 3. A release may be rendered invalid on a showing that the release was executed as the result of a mutual mistake of fact. A mutual mistake of fact is established only where it is shown that, at the time of the execution of a release, both parties were mistaken concerning an existing fact that was material to the agreement. Where there is a general release of all claims, a mutual mistake can vitiate the effect of the release only if neither party intended the release to be a general release. 4. The plaintiff failed to present any facts in support of her contention that the decedent did not intend to execute a general release or that he did not understand that the release was to be a general release of all claims. Further, any mutual mistake concerning the state of the decedent’s health was not material to the release agreement and, thus, would not invalidate the release. 5. The question whether a general release can exempt a defendant from liability under the fela was not raised in the trial court and, accordingly, is waived on appeal. 6. In view of the disposition of the plaintiff’s appeal, it is unnecessary to address the issues raised in the defendant’s cross appeal. Affirmed. 1. Railroads — Federal Employers’ Liability Act — State Courts — Civil Procedure. An action brought under the Federal Employers’ Liability Act in a state court is subject to state procedural rules (45 USC 51 et seq.'). 2. Release — Scope of Release — Intent of Parties. The scope of a release is controlled by the intent of the parties as it is expressed in the release; if the language of the release is unambiguous, the intent of the parties is ascertained from the plain and ordinary meaning of the language of the release. 3. Release — Mutual Mistake of Fact — General Release. A release may be rendered invalid where both parties were mistaken at the time of execution of the release concerning an existing fact that was material to the agreement; a mutual mistake can vitiate the effect of a general release of all claims only if neither party intended the release to be a general release. Sachs, Waldman, O’Hare, Helveston, Hodges & Barnes, P.C. (by George T. Fishback), for the plaintiff. Hackett, Maxwell & Phillips, P.L.L.C. (by Phillip B. Maxwell and Mark T. Butler), for the defendant. Before: Murphy, P.J., and Griffin and E. R Post, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Griffin, J. In this action brought under the Federal Employers’ Liability Act (fela), 45 USC 51 et seq., plaintiff appeals as of right an order of the circuit court granting defendant summary disposition pursuant to MCR 2.116(C)(7) (claim barred by release). We affirm. i For most of his adult life, plaintiff’s decedent, Justin T. Gortney, Jr., worked as a switchman and yardmaster for defendant, Norfolk & Western Railway Company. In 1987, Mr. Gortney accepted defendant’s offer of early retirement. According to the terms of the agreement, Mr. Gortney received $40,000 in exchange for his decision to sign a “resignation and release.” The written resignation and release states in pertinent part: I, J. T. Gortney . . . hereby resign and surrender any right to employment by Norfolk Southern Corporation, Norfolk and Western Railway Company, Southern Railway Company and any employer affiliated with or controlled by any of the aforenamed companies, for convenience referred to hereinafter individually and collectively as the “Company,” and hereby release and forever discharge the Company and its agents, officers and employees from any claim (with the exception of vested pension rights), demand, action or cause of action, of any kind whatsoever, known or unknown, which I have or could have on account of, or in any manner arising out of or connected with, my employment by the said Company, or the termination thereof, including but not limited to any claim or right asserted under or arising out of any agreement, regulation, condition or statute affording me employment protection, protecting me from employment discrimination, or covering the conditions of my employment. This resignation and release and the deductions [of federal and state taxes] authorized herein are fully understood BY ME. THIS DOCUMENT IS EXECUTED VOLUNTARILY AND SOLELY FOR THE CONSIDERATION ABOVE EXPRESSED, WITHOUT ANY OTHER REPRESENTATION, PROMISE, OR AGREEMENT OF ANY KIND WHATSOEVER HAVING BEEN MADE OR OFFERED TO ME BY THE COMPANY OR ANY AGENT, OFFICER, EMPLOYEE, OR REPRESENTATIVE OF THE SAID COMPANY. On September 30, 1987, Justin T. Gortney executed the above document and retired from defendant’s employ. Approximately two years later, Mr. Gortney died of lung cancer. In 1992, plaintiff as personal representative of the estate brought suit against defendant under the fela. Plaintiff claims that occupational exposure to diesel fumes caused decedent’s lung cancer and subsequent death. In November 1993, defendant moved for summary disposition pursuant to MCR 2.116(C)(7) on the grounds that plaintiff’s claim was barred by the terms of the release and by operation of the applicable statute of limitations. The trial court granted defendant’s motion, ruling that the release barred plaintiff’s cause of action. The trial court did not address defendant’s argument that plaintiff’s complaint was barred by the statute of limitations. n A felá case adjudicated in state court is subject to state procedural rules. St Louis SW R Co v Dickerson, 470 US 409, 411; 105 S Ct 1347; 84 L Ed 2d 303 (1985); see Cameron v Norfolk & WR Co, 891 SW2d 495, 497, 498 (Mo App, 1994). Accordingly, we apply the Michigan standard of review in assessing the propriety of the trial court’s decision to grant summary disposition. In reviewing a motion for summary disposition pursuant to MCR 2.116(C)(7), we must accept plaintiffs well-pleaded allegations as true, Shawl v Dhital, 209 Mich App 321, 323; 529 NW2d 661 (1995); Simmons v Apex Drug Stores, Inc, 201 Mich App 250, 252; 506 NW2d 562 (1993), and examine any pleadings, affidavits, depositions, admissions, and documentary evidence submitted by the parties in a light most favorable to the nonmovant. MCR 2.116(G)(5); Skotak v Vic Tanny Int’l, Inc, 203 Mich App 616, 617; 513 NW2d 428 (1994). If the pleadings show that a party is entitled to judgment as a matter of law, or if the affidavits or other proofs show that there is no genuine issue of material fact, the trial court must enter judgment without delay. MCR 2.116(I)(1); Skotak, supra at 617; Nationwide Mutual Ins Co v Quality Builders, Inc, 192 Mich App 643, 647-648; 482 NW2d 474 (1992). in Plaintiff first contends that the trial court misconstrued the language of the release as being sufficiently broad to encompass claims for personal injury. We disagree. The United States Supreme Court has directed that federal law be employed to assess the validity of a release that waives fela rights. Maynard v Durham & S R Co, 365 US 160, 161; 81 S Ct 561; 5 L Ed 2d 486 (1961) (citing Dice v Akron, C & Y R Co, 342 US 359; 72 S Ct 312; 96 L Ed 398 [1952]). Nevertheless, the lower federal courts have not consistently used federal law to determine whether a release is broad enough to embody a fela claim. See, e.g., Taggart v United States, 880 F2d 867, 870 (CA 6, 1989); Virginia Impression Products Co, Inc v SCM Corp, 448 F2d 262, 265 (CA 4, 1971). In the present case, we need not address the apparent conflict because we are compelled to the same conclusion regardless of whether we apply state or federal law. See generally Good v Pennsylvania R Co, 263 F Supp 84, 86 (ED Pa, 1967). The scope of a release is controlled by the intent of the parties as it is expressed in the release. See, e.g., Taggart, supra at 870; Virginia Impression Products, supra at 265; Gramer v Gramer, 207 Mich App 123, 125; 523 NW2d 861 (1994); Adell v Sommers, Schwartz, Silver & Schwartz, PC, 170 Mich App 196, 200; 428 NW2d 26 (1988). If the text in the release is unambiguous, we must ascertain the parties’ intentions from the plain, ordinary meaning of the language of the release. Empro Mfg Co, Inc v Ball-Co Mfg, Inc, 870 F2d 423, 425 (CA 7, 1989); Consolidated Gas Supply Corp v Federal Energy Regulatory Comm, 745 F2d 281, 283-284 (CA 4, 1984); Tuskegee Alumni Housing Foundation, Inc v Nat’l Homes Construction Corp, 450 F Supp 714, 716 (SD Ohio, 1978), aff’d 624 F2d 1101 (CA 6, 1980); see also Pakideh v Franklin Commercial Mortgage Group, Inc, 213 Mich App 636, 640; 540 NW2d 777 (1995); Michigan Chandelier Co v Morse, 297 Mich 41; 297 NW 64 (1941); Skotak, supra at 619; In re Loose, 201 Mich App 361, 366; 505 NW2d 922 (1993). The fact that the parties dispute the meaning of a release does not, in itself, establish an ambiguity. Int'l Union of Bricklayers & Allied Craftsman Local Union No 20 v Martin Jaska, Inc, 752 F2d 1401, 1406 (CA 9, 1985); Wabash, Inc v Avnet, Inc, 516 F Supp 995, 998 (ND Ill, 1981); see also Moore v Kimball, 291 Mich 455, 460-461; 289 NW 213 (1939). A contract is ambiguous only if its language is reasonably susceptible to more than one interpretation. Stewart v KHD Deutz of America Corp, 980 F2d 698, 702 (CA 11, 1993); see Thomas v Jewell, 300 Mich 556, 560-561; 2 NW2d 501 (1942). If the terms of the release are unambiguous, contradictory inferences become “subjective, and irrelevant,” Cleveland-Cliffs Iron Co v Chicago & NW Transportation Co, 581 F Supp 1144, 1149 (WD Mich, 1984), and the legal effect of the language is a question of law to be resolved summarily. Empro Mfg, supra at 425; Mason Drug Co, Inc v Harris, 597 F2d 886, 887 (CA 5, 1979); Freeman v Continental Gin Co, 381 F2d 459, 465 (CA 5, 1967); see also Skotek, supra at 619; Restatement Contracts, 2d, § 212, comment d, p 127; Calamari & Perillo, Contracts (3d ed), § 3-10, pp 166-167. In the present case, the language of the release evidences a clear intent to settle and to release defendant from liability for “any claim[,] . . . demand, action or cause of action, of any kind whatsoever, known or unknown, which [decedent had] or could have [had] on account of, or in any manner arising out of or connected with, [his] employment.” We find no ambiguity in this broad, all-encompassing language. Indeed, the language releasing “any claim ... of any kind whatsoever” can hardly be interpreted as excluding claims for personal injury. See, e.g., Taggart, supra; Virginia Impression Products, supra; Dombrowski v City of Omer, 199 Mich App 705, 708; 502 NW2d 707 (1993); Moore v Campbell, Wyant & Cannon Foundry, 142 Mich App 363, 368; 369 NW2d 904 (1985). Nor does the release contain any other language that could suggest such an interpretation. Contrary to plaintiffs contention, the text of the release does not limit its scope to issues pertaining to the terms of employment. Rather, the release expressly states that it applies to “any” claim and that its scope is “not limited to” any specifically enumerated topic. In sum, the release is capable of but one reasonable interpretation: that decedent released all claims, including personal injury claims, in exchange for a substantial monetary consideration. Accordingly, we hold that the trial court correctly ruled that decedent released defendant from all personal injury actions that arose during the course of decedent’s employment with defendant. IV Plaintiff also claims that the release cannot validly waive a fela claim because it was premised upon a mutual mistake of fact. Again, we disagree. Pursuant to federal law, and consistent with state law, the party challenging a release bears the burden of establishing its invalidity. Callen v Pennsylvania R Co, 332 US 625, 629; 68 S Ct 296; 92 L Ed 242 (1948). This burden may be overcome by showing that the release was executed in reliance on a mutual mistake of fact. Maynard, supra at 163; Shaheen v B F Goodrich Co, 873 F2d 105, 107 (CA 6, 1989); Brophy v Cincinnati, N O & T P R Co, 855 F Supp 213, 215 (SD Ohio, 1994). A release agreement may be set aside on the basis of a mutual mistake only if plaintiff can establish that at the time the release was executed, both parties were mistaken concerning an existing fact that was material to the agreement. Counts v Burlington N R Co, 952 F2d 1136, 1141 (CA 9, 1991); Locke v Atchison T & S F R Co, 309 F2d 811, 816 (CA 10, 1962); Cleveland-Cliffs, supra at 1152; see also Gust v Consolidated Rail Corp, 116 Mich App 90, 92; 321 NW2d 852 (1982), citing Heston v Chicago & NW R Co, 341 F Supp 126 (ND Ill, 1972); see generally Sherwood v Walker, 66 Mich 568; 33 NW 919 (1887). Where, as here, there exists a general release of all claims, a mutual mistake can vitiate the effect of a release only if neither party intended the agreement to be a general release. Virginia Impression, supra at 265. In the instant case, plaintiff has documented no facts in support of her contention that decedent did not intend to execute a general release. Nor does plaintiff allege or document that decedent did not understand the release to be a general release of all claims. Virginia Impression, supra at 265. Therefore, we conclude that plaintiff has failed to establish a genuine issue of material fact in support of her position. Further, plaintiff effectively concedes the inapplicability of the mutual mistake doctrine by emphasizing in her appellate brief that the existence or nature of “decedent’s health was not material to the release.” Because the doctrine of mutual mistake applies only when the mistaken fact was material to the agreement, Heston, supra at 128; Gust, supra at 92; Calamari, § 9-26, pp 379, 383, the alleged mutual mistake regarding decedent’s health cannot invalidate the release in light of plaintiff’s concession that decedent’s health was immaterial to the release agreement. The cases plaintiff cites in support of her mutual mistake argument concern settlements arising out of specific actions for personal injury. See Taylor v Chesapeake & O R Co, 518 F2d 536 (CA 4, 1975); Gust, supra. In each case, the nature of the injuries was material to the agreements because the settlements and releases were allegedly bargained for and premised on erroneous beliefs about the nature of the involved injuries. Taylor, supra; Gust, supra. Here, on the other hand, plaintiff concedes that the existence or nature of an injury was immaterial and had never even been considered. Accordingly, we conclude that the trial court did not err in refusing to vitiate the broad release agreement because of a claimed mutual mistake. v Finally, plaintiff claims that pursuant to 42 USC 55, the general release at issue cannot exempt defendant from fela liability. However, plaintiff failed to raise this issue below. Furthermore, the facts necessary for us to address this issue have neither been presented nor resolved. Accordingly, plaintiff has waived this issue. Booth Newspapers, Inc v Univ of Michigan Bd of Regents, 444 Mich 211, 234; 507 NW2d 422 (1993); Garavaglia v Centra, Inc, 211 Mich App 625; 536 NW2d 805 (1995). In view of our disposition, we find it unnecessary to address the issues raised in defendant’s cross appeal. Affirmed. According to plaintiff’s deposition testimony, decedent had complained that the noxious diesel fumes he had encountered at work had made him cough and had caused him respiratory trouble. Plaintiff’s testimony suggests that decedent had complained about these problems during his tenure of employment with defendant. Because these observations present an unresolved factual issue regarding whether decedent had bargained away and released a known fela claim, we cannot conclude that all facts necessary for resolution of this issue are presented on appeal. See, e.g., South Buffalo R Co v Ahern, 344 US 367, 372; 73 S Ct 340; 97 L Ed 395 (1953); Callen, supra at 630-631; Shaheen, supra at 107.
EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellant/Respondent v. WILLIAM PEACE, Appellee/Petitioner EMPLOYMENT SECURITY COMMISSION OF NORTH CAROLINA, Appellee-Respondent, v. WILLIAM H. PEACE, III, Appellant-Petitioner. No. COA94-1283 No. COA95-678 (Filed 7 May 1996) 1. Public Officers and Employees § 67 (NCI4th)— state employee’s obtaining coffee without permission— employee’s filing of criminal charge — dismissal without just cause — sufficiency of evidence to support findings The evidence was sufficient to support the findings of the Personnel Commission, and its findings were sufficient to support its conclusions that petitioner, a permanent state employee, was not dismissed for just cause and should be reinstated where the evidence tended to show that petitioner, in good faith, believed his membership in the office petty fund allowed him to obtain coffee from the personnel file room, which he did; when a supervisor in the personnel office told petitioner he should pay for the coffee, petitioner refused; the supervisor called petitioner despicable, told him she hoped he was fired, and told petitioner that, if he got another cup of coffee without paying, she would get a cup of coffee and scald him with it; petitioner had the right to seek protection from potential bodily harm by taking his complaint to the proper judicial officials, even if the charge was dismissed as frivolous by the trial court; and petitioner was not contacted by his superiors regarding the incident until he received a predismissal conference memorandum the day before his dismissal conference, after which he was dismissed for unacceptable personal conduct. Am Jur 2d, Civil Service § 63. 2. Public Officers and Employees § 66 (NCI4th)— termination for good cause — burden of proof on employer The Personnel Commission properly required the employer, the Employment Security Commission, to carry the burden of proving petitioner was terminated for good cause. Am Jur 2d, Civil Service § 61. Appeal by respondent from order entered 12 August 1994 by Judge Narley L. Cashwell in Wake County Superior Court and appeal by petitioner from order entered 13 March 1995 by Judge Wiley F. Bowen in Wake County Superior Court. Heard in the Court of Appeals 19 March 1996. Attorney General Michael F. Easley, by Chief Deputy Attorney General Andrew A. Vanore, Jr., and Assistant Attorney General Valerie Bateman, for North Carolina Department of Justice; and Chief Counsel T.S. Whitaker and Attorney Fred R. Gamin, for North Carolina Employment Commission, respondent appellant-appellee. Hilliard & Jones, by Thomas Hilliard, III, for petitioner appellant-appellee. SMITH, Judge. Petitioner, William H. Peace, III, appeals a superior court order reversing a State Personnel Commission decision which reinstated petitioner as an employee of respondent, the Employment Security Commission of North Carolina (“ESC”). ESC appeals a superior court order affirming an Office of Administrative Hearing (“OAH”) decision finding a Title VII violation and reinstating petitioner. After carefully reviewing the record, we agree with petitioner’s contention that ESC has failed to show that it dismissed petitioner with just cause. Therefore, we affirm the decision of the State Personnel Commission reinstating petitioner. For reasons stated herein, we do not address the merits of ESC’s appeal. William H. Peace, III, began his employment with respondent on 15 October 1985 as its Equal Employment Opportunity (“EEO”) officer. On 10 April 1991, an incident between Peace and a coworker occurred which ultimately led to Peace’s dismissal for alleged unacceptable personal conduct. The State Personnel Commission adopted, inter alia, the following facts as recommended by the Administrative Law Judge (“ALT’): During his 1985 orientation, petitioner was informed that by paying $2.00 per month to the Personnel Office petty fund, he would be entitled to obtain an occasional cup of coffee from a pot located in the personnel file room. He paid the dues; however, his usual practice was to go to the agency’s cafeteria for morning coffee. Prior to 10 April 1991, no one informed petitioner that his payment into the petty fund did not entitle him to obtain coffee from the personnel file room. Over the years, on an irregular basis, he obtained coffee from the petty fund coffee pot. At a staff meeting which petitioner did not attend, a coffee fund was established, for which membership dues were $3.40 per month. Petitioner was not made aware of a separate coffee fund, nor was he asked to join. On 10 April 1991, petitioner got a cup of coffee from the personnel file room. As petitioner was leaving the office with the coffee an exchange between him and Ms. Catherine High, a supervisor in the personnel office, took place in which she told him that he should pay her for the coffee. Petitioner refused. Ms. High called petitioner “despicable” and told him she hoped he was fired. She ended the colloquy by telling petitioner that, if he got another cup of coffee and did not pay her, she would get a cup of coffee and scald him with it. Ms. High informed her supervisor and Mr. Gene Baker, who became petitioner’s immediate supervisor as of 22 April 1991, of the incident. On the afternoon of 10 April 1991, petitioner contacted the magistrate’s office regarding the incident with Ms. High. He was informed that if he believed she was capable of carrying out her threat, he should take out a warrant against her. Petitioner spoke with Ms. High following his conversation with the magistrate’s office, at which time he gave her an opportunity to apologize. Ms. High did not apologize. Thereafter, petitioner had the magistrate’s office issue summons against Ms. High charging her with communicating a threat. The charge was dismissed by the trial court as frivolous and petitioner was ordered to pay court costs. Petitioner was not contacted by his superiors regarding the incident until he received a predismissal conference memorandum on 5 June 1991, from Gene Baker, his immediate supervisor. Following a 6 June dismissal conference, petitioner was discharged for unacceptable personal conduct. In a 7 June letter, Ann Q. Duncan, Chairperson of the Employment Security Commission explained that petitioner was being dismissed for unacceptable conduct, including taking the coffee without paying Catherine High and filing criminal charges against High, which were found to be frivolous. Such conduct, said Duncan, caused petitioner’s reputation as the EEO officer at ESC to be called into question and his respect among fellow employees diminished. Petitioner filed two appeals to the ESC decision to discharge him. The basis of his appeals were that ESC lacked “just cause” to dismiss him pursuant to N.C. Gen. Stat. § 126-35 (1995), and that he had been discharged in retaliation for having filed discrimination charges against ESC in 1989, in violation of Title VII, Section 704(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-3 (1964). Petitioner did not appeal upon a state claim of retaliatory discharge pursuant to N.C. Gen. Stat. § 126-36. Pursuant to N.C. Gen. Stat. § 7A-759, petitioner’s charge of retaliatory discharge was investigated by the Civil Rights Division of the Office of Administrative Hearings. Through its investigation, OAH found reasonable cause to believe that a violation of Title VII had occurred. OAH presented petitioner with three options. He could: (1) receive a right to sue letter; (2) commence a contested case hearing in OAH; or (3) do nothing. Petitioner chose to commence a contested case hearing with regard to the retaliatory discharge claim. He also filed a petition for contested case hearing with regard to the N.C. Gen. Stat. § 126-35 lack of “just cause” claim. Pursuant to an order of the Chief Administrative Law Judge of OAH, both cases were consolidated for hearing. A hearing was conducted by AU Sammie Chess on 12-14 July 1993. Pursuant to N.C. Gen. Stat. § 7A-759(e), an AU decision on the merits of a retaliatory discharge claim is a final decision binding on the parties. However, with regard to the N.C. Gen. Stat. § 126-35 lack of “just cause” claim, an AU issues a recommended decision to the State Personnel Commission, which then issues a final decision. N.C. Gen. Stat. § 126-37 (1995). ALJ Chess issued two separate decisions following the hearing. In his recommended decision to the State Personnel Commission, AU Chess found that ESC had the burden of proving it had “just cause” to discharge petitioner. ALJ Chess concluded that ESC had failed to meet that burden and recommended petitioner be reinstated. In his final decision regarding the retaliatory discharge claim pursuant to Title VII, AU Chess concluded that petitioner’s discharge violated Section 704(a) of Title VII of the Civil Rights Act of 1964, in that his dismissal was retaliatory. Pursuant to that holding, AU Chess ordered petitioner reinstated. The AU’s recommended decision reinstating petitioner for lack of “just cause” was adopted, with slight modification, by the State Personnel Commission. ESC appealed the State Personnel Commission order and the AU final decision separately, pursuant to N.C. Gen. Stat. § 150B-50 (1995). In a 13 August 1994 order, Judge Narley L. Cashwell upheld the final decision of the AU with regard to the retaliatory discharge claim in which petitioner was ordered reinstated. In a 13 March 1995 order, Judge Wiley F. Bowen reversed the final decision of the State Personnel Commission and dismissed Peace’s petition challenging his dismissal. From these superior court orders, ESC appeals Judge Cashwell’s order affirming the retaliatory discharge claim. Petitioner appeals Judge Bowen’s order reversing the State Personnel Commission decision to reinstate him. Initially, we note that the two cases should have been consolidated for all purposes except the final agency decision by the AU pursuant to N.C. Gen. Stat. § 150B-26. Failing that, the appeals from the AU and State Personnel Commission orders should have been consolidated in ESC’s petition for judicial review to the superior court. At the very least, the two appeals should have been consolidated for hearing in the superior court, as both appeals involved identical facts and similar questions of law. As a result of the failure to consolidate and the filing of two separate petitions for judicial review, two inconsistent orders were issued from Wake County Superior Court. In addition, we are now presented with two records on appeal and two sets of lengthy briefs, all arising out of the same set of facts. After careful review of both records and both sets of briefs in this case, we agree with petitioner that the superior court erred in reversing the State Personnel Commission decision to reinstate petitioner. For this reason, it is unnecessary for us to reach the merits of ESC’s appeal of the superior court order affirming the AU order to reinstate petitioner under the retaliatory discharge claim, as that issue is rendered moot by our decision reinstating the decision of the State Personnel Commission. This Court’s as well as the superior court’s review of a final agency decision is governed by N.C. Gen. Stat. § 150B-51 (1995). In Re: Appeal of Ramseur, 120 N.C. App. 521, 463 S.E.2d 254 (1995); Dockery v. Dept. of Human Resources, 120 N.C. App. 827, 463 S.E.2d 580 (1995). The proper standard of review depends upon the particular issues presented on appeal. Brooks v. Ansco & Associates, 114 N.C. App. 711, 716, 443 S.E.2d 89, 92 (1994). “If it is alleged that the agency’s decision was based on an error of law, then de novo review is required. If, however, it is alleged that the agency’s decision was not supported by the evidence or that the decision was arbitrary or capricious, then the reviewing court must apply the ‘whole record’ test.” In re: Appeal of Ramseur, 120 N.C. App. at 524, 463 S.E.2d at 256 (citations omitted). To determine whether an agency’s findings are supported by substantial evidence, the reviewing court applies the “whole record” test. Leiphart v. N.C. School of the Arts, 80 N.C. App. 339, 342 S.E.2d 914, cert. denied, 318 N.C. 507, 349 S.E.2d 862 (1986). “Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Comr. of Insurance v. Rating Bureau, 292 N.C. 70, 80, 231 S.E.2d 882, 888 (1977) (citation omitted). The “whole record” test requires the reviewing court to take into account all evidence in the record, including evidence which supports the Commission’s decision as well as that which in fairness detracts from it. Id. However, “[t]he ‘whole record’ test does not allow the reviewing court to replace the [agency’s] judgment as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before it de novo . . . .” Thompson v. Board of Education, 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977) (citation omitted). As the reviewing court, we must take into account the specialized expertise of the staff of an administrative agency, in this case, the State Personnel Commission. High Rock Lake Assoc. v. Environmental Management Comm., 51 N.C. App. 275, 279, 276 S.E.2d 472, 475 (1981). While there is evidence in the record contrary to the Commission’s findings, neither this Court nor the superior court may substitute its judgment for that of the agency. After reviewing the record, we find substantial evidence to support the State Personnel Commission’s findings of fact. While the criminal charges brought by petitioner against Ms. High were found to be frivolous, the Commission found as fact that “[t]he petitioner believed that Ms. High was capable of scalding him with coffee.” In passing upon issues of fact, the Commission, as trier of fact, is the sole judge of the credibility of the witnesses, and of the weight to be given to their testimony. This being true, it may accept or reject the testimony of a witness, in whole or in part, depending solely upon whether it believes or disbelieves the witness. Anderson v. Motor Co., 233 N.C. 372, 376, 64 S.E.2d 265, 268 (1951). The Commission found it pertinent that the judicial officer (magistrate) “found facts sufficient to issue the warrant.” The Commission also found that none of the reasons for petitioner’s dismissal were ever discussed with him prior to 6 June 1991. Applying the “whole record” test, we find the Commission’s findings are supported by substantial evidence. Based upon its findings of fact, the State Personnel Commission made the following conclusions of law: 1. Petitioner was a Permanent State employee within the meaning of that term as defined in North Carolina General Statute Section 126-39, at the time of his dismissal on June 7, 1991. The Office of Administrative Hearings has jurisdiction to hear Petitioner’s appeal where he has alleged that Respondent lacked just cause to terminate his employment without warning and where he has alleged that Respondent committed procedural violations while implementing the dismissal. [N.C. Gen. Stat. §] 126-35. 2. [N.C. Gen. Stat. §]126-35(a) provides, in part, that “[N]o permanent employee subject to the State Personnel Act shall be discharged . . . for disciplinary reasons, except for just cause.” Where just cause is an issue, the Respondent bears the ultimate burden of persuasion. A just cause issue involves both procedural and substantive questions. Causes for dismissal fall into two categories: (1) causes relating to performance of job duties and, (2) causes relating to personal conduct - no prior warnings are required under (2). 3. The Petitioner was not discharged for just cause. 5. Respondent’s actions, or lack thereof, following the April 10, 1991 coffee incident and May 21, 1991 court judgment were inconsistent with its claim that Petitioner’s conduct was unacceptable. For the two month period, April 10, 1991 through June 6, 1991, Respondent never raised the issue of unacceptable personal conduct with Petitioner; in addition, during that period, Petitioner’s work performance was neither reviewed nor appraised by Respondent to determine what impact, if any, the above incidents had on his reputation as the EEO Officer. No evidence showed that Petitioner was unfit to continue his employment due to the events occurring in April and May, 1991. 8. Petitioner belonged to the petty fund and in good faith believed that, as in the past, such membership continued his entitlement to an occasional cup of coffee. 13. Petitioner had the right to seek protection from potential bodily harm by taking his complaint to proper judicial officials. Based upon the foregoing conclusions of law, the Commission reversed ESC’s decision to dismiss petitioner because such decision was without “just cause.” Petitioner’s argument that his discharge was not for. “just cause” based upon his personal misconduct raises a question of law and is, therefore, reviewed de novo by this Court. Amanini v. N.C. Dept. of Human Resources, 114 N.C. App. 668, 678, 443 S.E.2d 114, 120 (1994). An alleged error of law “exists if a conclusion of law entered by the administrative agency is not supported by the findings of fact entered by the agency or if the conclusion of law does not support the decision of the agency.” Brooks, 114 N.C. App. at 717, 443 S.E.2d at 92. In this case, we hold the agency’s findings, support its conclusions, and its conclusions support its decision to reinstate petitioner. As a career state employee, defined in N.C. Gen. Stat. § 126-1A, petitioner could not be dismissed from employment with ESC except for “just cause.” N.C. Gen. Stat. § 126-35. The “just cause” provision creates a “property interest of continued employment . . . protected by the Due Process Clause of the United States Constitution.” Leiphart, 80 N.C. App. at 348, 342 S.E.2d at 921 (citations omitted). In its order, the State Personnel Commission held that the burden of proving “just cause” existed to justify dismissal is upon the State. In a recent decision involving almost identical “just cause for termination” provisions governing City of Raleigh employees, this Court held the City’s rules placing the burden of showing lack of “just cause” upon the city employee constitutionally infirm. Soles v. City of Raleigh Civil Service Comm., 119 N.C. App. 88, 457 S.E.2d 746, disc. review allowed, 341 N.C. 652, 462 S.E.2d 517 (1995). In reaching its decision, the Soles court applied a balancing test, weighing the respective interests of the individual and the governmental entity. Id. at 95, 457 S.E.2d at 751. Specifically, the Court looked at three factors: “[F]irst, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.” Id. (quoting Mathews v. Eldridge, 424 U.S. 319, 335, 47 L.Ed. 2d 18, 33 (1976)). Examining those factors, the Soles court held that Mr. Soles’ interest in retaining his employment was a constitutionally protected property right. Regarding the second factor, the court held that “requiring the dismissed employee to prove that the ‘action taken against him was unjustified’ significantly increases the risk of an erroneous deprivation of the right to retain employment,” Id. at 96, 457 S.E.2d at 752. With respect to the third factor, the court recognized the City’s legitimate interest in maintaining good, efficient employees for the efficient operation of government, and in that case, insuring that employees are not using illegal drugs. Nevertheless, the court concluded that the “scales tip in favor of an individual empl
Marlyn Guzman vs. Lazar Lowinger. Middlesex. January 9, 1996. May 3, 1996. Present: Liacos, C.J., Wilkins, Abrams, Lynch, O’Connor, Greaney, & Fried, JJ. Employment, Discrimination, Sexual harassment. Anti-Discrimination Law, Sex, Employment. Civil Rights, Availability of remedy. Statute, Construction. General Laws c. 214, § 1C, inserted by St. 1986, c. 588, § 6, provides the exclusive statutory remedy for a claim of sexual harassment brought against an employer of fewer than six employees, and bars recovery for the same conduct under the Massachusetts Civil Rights Act, G. L. c. 12, § 111. [571-573] Civil action commenced in the Superior Court Department on July 7, 1592. A motion for summary judgment was heard by James F. McHugh, III, J., and the case was tried before him. The Supreme Judicial Court granted an application for direct appellate review. Thomas C. Cameron for the plaintiff. Thomas J. Chirokas (Lazar Lowinger with him) for the defendant. Lynch, J. The plaintiff, Marlyn Guzman, brought this action against her former employer, the defendant, Lazar Lowinger, to recover for injuries arising out of Lowinger’s alleged sexual harassment of the plaintiff in 1992. The plaintiff brought statutory claims under G. L. c. 214, § 1C (1994 ed.), and the Massachusetts Civil Rights Act, G. L. c. 12, § 111 (1994 ed.) (civil rights act). She also brought common law claims for assault and battery, intentional infliction of emotional distress, and wrongful termination. Before trial, the defendant moved for summary judgment on all counts. The judge granted the motion as to the civil rights act claim. After a trial on the other claims, a jury awarded the plaintiff $6,500 for intentional infliction of emotional distress, and found for the defendant on all the other counts. The plaintiff appeals from the judge’s dismissal of the civil rights count. We granted the plaintiff’s application for direct appellate review and now affirm. Taking the facts in the light most favorable to the plaintiff, the record indicates the following: Marlyn Guzman was employed as a bilingual legal secretary by the defendant for four months in 1992. The defendant is a practicing attorney with fewer than six employees. While the plaintiff was working for the defendant, he is alleged to have engaged in unwanted, unprovoked, and inappropriate behavior, including physical assaults and offensive verbal comments of a sexual nature, which led the plaintiff to believe that she had to choose between giving in to the defendant’s demands for a sexual relationship, or quitting her job. As a result of the harassment, the plaintiff suffered severe emotional distress; eventually, she felt compelled to leave the defendant’s employ. The Legislature hás provided a comprehensive remedial scheme for victims of sexual harassment in the workplace in G. L. c. 151B, § 4 (16A), and G. L. c. 214, § 1C, inserted by St. 1986, c. 588, §§ 3 and 6, respectively. As we noted in Green v. Wyman-Gordon Co., ante 551 (1996), and Doe v. Purity Supreme, Inc., ante 563 (1996), where G. L. c. 151B applies, its procedural prerequisites may not be bypassed by reconstituting a sexual harassment claim as a violation of the civil rights act or the Massachusetts Equal Rights Act, G. L. c. 93, § 102 (1994 ed.), or as a new common law claim. See Charland v. Muzi Motors, Inc., 417 Mass. 580, 586 (1994). Here, the defendant has fewer than six employees and so is not an employer subject to the provisions of G. L. c. 151B. Nevertheless, as the judge correctly recognized, the claim falls squarely under G. L. c. 214, § 1C, which permits employees such as the plaintiff to bring suit in the Superior Court for damages rising from sexual harassment in employment. Just as G. L. c. 151B provides an exclusive remedy for sexual harassment claims against employers with six or more employees, G. L. c. 214, § 1C, provides the exclusive remedy for such claims against employers of fewer than six employees. In neither case does an independent and duplicative right exist to pursue such claims under the civil rights act. In O’Connell v. Chasdi, 400 Mass. 686 (1987), this court allowed a plaintiff to pursue a sexual harassment claim against her employer under the civil rights act, where the employer was not covered by c. 151B. Id. at 693-694. Where no other underlying common law or statutory right was implicated, the court found a right to be free from sexual harassment in art. 1 of the Massachusetts Declaration of Rights, as amended by art. 106 of the Amendments. Id. The crucial difference between O’Connell v. Chasdi, supra, and the instant case is the passage of St. 1986, c. 588, § 6, after the underlying action in O’Connell had been filed. By adding G. L. c. 214, § 1C, the Legislature provided that which was missing in O’Connell: a statutory right to be free from sexual harassment. Where, as here, G. L. c. 151B does not apply, an employee may bring a claim under G. L. c. 214, § 1C. Indeed, the plaintiff did bring such a claim in this case. Having lost at trial on this claim, she now seeks to retry the same claim under the auspices of the civil rights act. We perceive no indication that the Legislature intended to create such a duplication of remedies for sexual harassment claimants. See Charland v. Muzi Motors, Inc., supra. It is true that the result we reach creates somewhat of an anomaly. Employees of larger concerns must pursue their claims first at the Massachusetts Commission Against Discrimination (MCAD), while employees of smaller scale employers can bypass the MCAD and bring their actions directly in the Superior Court. While we are at a loss to perceive in the statutory framework a reasoned basis for this distinction, neither is there any basis for concluding that the Legislature intended to provide two remedies for the same claim. We conclude therefore that, in enacting St. 1986, c. 588, the Legislature created a comprehensive scheme for adjudicating claims of sexual harassment in the workplace. Where, as here, G. L. c. 214, § 1C, applies to a claim of sexual harassment, it is the exclusive statutory remedy and therefore bars recovery under the civil rights act. See Green v. Wyman-Gordon Co., supra. Judgment affirmed. Although the judge stated that he was dismissing the claim, he appears to have been ruling on the defendant’s motion for summary judgment. The plaintiff argues that the standard for a motion to dismiss should apply. We need not resolve the issue since the defendant is entitled to judgment as matter of law under either standard. The defendant’s actions alleged included: grabbing the plaintiff by the hips and pulling her onto his lap; taking hold of both of the plaintiff’s hands while talking to her; putting his arm around her; and stating that she should “dump her boyfriend,” that the plaintiff’s “ruby lips” were driving him crazy, that her engagement ring meant nothing to him, and that she needed a “real man” like the defendant. On one occasion, the defendant allegedly told the plaintiff, “If [I] were younger, [I would] eat [you] in such a way [as to] leave no leftovers for [your] boyfriend.”
Edward G. Clement, Jr. vs. Rev-Lyn Contracting Company & another No. 95-P-50. Suffolk. February 15, 1996. April 24, 1996. Present: Armstrong, Gillerman, & Ireland, JJ. Unlawful Interference. Contract, Employment. Employment, Termination. Practice, Civil, Instructions to jury. A corporation could not be held vicariously liable for wrongful interference with the employment of one of its own employees based on the tortious conduct of one of its supervisory employees. [323-324] At the trial of a claim for wrongful interference with employment, the judge’s erroneous instructions to the jury with respect to the legal standard governing the plaintiffs termination from employment by the defendant and his failure to instruct properly on the plaintiffs burden of proof in the circumstances presented required that the defendant be granted a new trial on that claim. [324-326] Civil action commenced in the Superior Court Department on May 18, 1989. The case was tried before Hiller B. Zobel, J. Howard G. Guggenheim for the defendants. David F. Cavers, Jr., for the plaintiff. Ralph L. Beaudoin Gillerman, J. From September, 1986, until the termination of his employment on August 8, 1988, Edward G. Clement, Jr., was an estimator and foreman for Rev-Lyn Contracting Company (corporation). The corporation, forty-nine per cent of which was owned by the defendant Ralph L. Beaudoin, was in the marine contracting business. In the action Clement brought against the corporation and Beaudoin, the jury, answering special questions, found that Beaudoin wrongfully interfered with Clement’s employment by the corporation, and that Beaudoin’s wrongful interference was the proximate cause of Clement’s damages in the amount of $45,000. The jury also found that Beaudoin had slandered Clement, that the slanderous remarks were not privileged, but that Clement suffered no damages as a result of the slanderous remarks. Following the verdict of the jury, the judge, over the defendant’s objection, allowed Clement’s motion to amend the complaint by adding the corporation as a party defendant to the count regarding wrongful interference. Thereafter, judgment was entered against both defendants on the wrongful interference claim, and subsequently the defendants’ motions for new trial and for judgment notwithstanding the verdict were denied. The defendants filed a timely notice of appeal. We conclude that the judgment against the corporation must be reversed and the claim of wrongful interference against the corporation dismissed, and that there must be a new trial of the claim against Beaudoin as a result of an error in the judge’s instructions to the jury on the wrongful interference claim. 1. The judgment against the corporation. Clement acknowledges that his task of preserving the judgment against the corporation requires “departing from the usual rule” that malicious interference by a supervisory employee will not be imputed to the employer. See Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 663 n.3 (1981); Riseman v. Orion Research, Inc., 394 Mass. 311, 314 (1985); Mailhiot v. Liberty Bank & Trust Co., 24 Mass. App. Ct. 525, 528 (1987). See also Saint Louis v. Baystate Med. Center, Inc., 30 Mass. App. Ct. 393, 404 (1991). Clement makes the argument that if liability can be imposed on an employer who terminates an at-will employee in violation of clearly established public policy, see Hobson v. McLean Hosp. Corp., 402 Mass. 413, 416 (1988), then vicarious liability should be imposed when an at-will employee is discharged with actual malice by a supervisor acting within the scope of his or her employment. To permit the existing distinction, the argument runs, is merely to select violations of public policy as more deserving of protection than malicious acts of supervisory employees — a choice that cannot rationally be defended. We will not enter that debate, and consider the result in this case controlled by the cases cited above, all of them relatively recently decided. See also Smith- Pfeffer v. Superintendent of the Walter E. Fernald State School, 404 Mass. 145, 150 (1989). The judge was in error in entering judgment against the corporation. 2. The judge’s instruction regarding Beaudoin. The judge’s instructions to the jury regarding the claim of intentional interference reduced the issue of the validity of Clement’s termination to the question whether Beaudoin did it “in a reasonable way.” The defendant objected, citing Wright v. Shriners Hosp. for Crippled Children, 412 Mass. 469, 476 (1992). The judge’s instructions were not consistent with Wright v. Shriners Hosp. for Crippled Children, supra, and if the error injuriously affected the substantial rights of Beaudoin, there must be a new trial. See Timmons v. Massachusetts Bay Transp. Authy., 412 Mass. 646, 652 (1992). In an action for intentional interference with contractual relations, the plaintiff must prove that the defendant intentionally interfered with the plaintiff’s business relationship with a third person and that such intentional interference was improper in motive or means. See United Truck Leasing Corp. v. Geltman, 406 Mass. 811, 816 & n.8 (1990); Melo-Tone Vending, Inc. v. Sherry, Inc., 39 Mass. App. Ct. 315, 316, 318 (1995). See Restatement (Second) of Torts §§ 766-767 (1979). Where, as here, the termination is by a supervisor acting within the scope of his responsibilities, the supervisor (Beaudoin) “was privileged to act as he did,” but the plaintiff may prevail if he proves that the supervisor “acted out of malevolence, that is, with ‘actual’ malice.” Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 663 (1981). See also Wright, supra at 476 (there is a right to fire an at-will employee unless the termination is “for a spiteful, malignant purpose, unrelated to the legitimate corporate interest”); Sereni v. Star Sportswear Mfg. Corp., 24 Mass. App. Ct. 428, 432-433 (1987). While Clement presented evidence (and the jury found) that at a meeting on August 9, 1988, Beaudoin grossly slandered Clement in the presence of other employees without justification, and while Clement also presented evidence that Beaudoin, at the August 9 meeting, threatened Clement with physical violence if he showed up for work the next day (all of which was sufficient to warrant the finding that Beaudoin acted with a malignant purpose), there was also evidence presented by Beaudoin that he did not act out of a “spiteful, malignant purpose, unrelated to the legitimate corporate interest,” see Wright, supra at 476. Beaudoin’s evidence, if credited by the jury, could be sufficient to warrant the finding that Beaudoin acted to benefit the corporation. Where, as here, there is evidence that Beaudoin acted both from malicious motives and a motive related to the corporation’s legitimate interests (see note 9, supra), the plaintiff has the burden of proving that Beaudoin’s “actions were unrelated to any legitimate corporate interest.” Boothby v. Texon, Inc., 414 Mass. 468, 487 (1993). The jury should have been instructed regarding the need to determine whether the plaintiff had carried his burden of proving that Beaudoin acted with a malignant purpose, unrelated to any legitimate corporate interest, and a suitable special question to that end could have been framed. By lowering the threshold of liability from a “spiteful, malignant purpose” to conduct that was merely unreasonable, the judge improperly diminished the plaintiffs burden of proof to the material disadvantage of Beaudoin. Beaudoin is entitled to a new trial on the claim against him for causing the termination of Clement’s at-will employment. The judgment with respect to Rev-Lyn Contracting Company is reversed, and judgment is to enter dismissing the complaint as to that defendant. The judgment against Beaudoin on count II is reversed, and the case is remanded to the Superior Court for further proceedings on that count. So ordered. The remaining fifty-one per cent was owned by Rosemary Kelly. Neither party claims any error regarding the slander claim. The corporation was already a defendant on the slander count. The defendant had filed a motion for a directed verdict at the close of the evidence. We have also considered Clement’s suggestion that because the corporation was a small enterprise owned entirely by Beaudoin and Rosemary Kelly, the new rule he proposes — if limited to close corporations — would be quite narrow in scope. We are unpersuaded by the argument, for what is at stake is the risk of converting the existing rule regarding at-will employees into a rule requiring just cause for terminating such employees. See Wright v. Shriners Hosp. for Crippled Children, 412 Mass. 469, 475 (1992). Beaudoin, relying on the same facts, argues that the judge erred in denying his motion for judgment notwithstanding the jury’s verdict. That is, Beaudoin claims that, with forty-nine per cent of the stock, he was the employer and, therefore, he cannot be liable for tortious interference with his own contract. We reject that argument as well; Beaudoin fails to advance any sound reason for disregarding the corporate entity. The full statement by the judge to the jury was, “The question is did he do it in a reasonable way.” In response, a juror asked whether it is “[wjrongful based on what we consider is reasonable or wrongful based on what the law says is reasonable?” The judge replied, “On what you think is reasonable.” Beaudoin testified, without objection, to his authority to hire and fire. Beaudoin testified that Clement cost the corporation a quarter of a million dollars, that Clement had taken much too long in performing the contract at Osterville, that Clement used unnecessary equipment which cost the company a lot of money, and that Beaudoin wanted Clement out of the corporation because of poor job performance.
Robert J. Fairneny & another vs. Savogran Company. Norfolk. March 4, 1996. April 17, 1996. Present: Liacos, C.J., Wilkins, Abrams, Lynch, & Greaney, JJ. Practice, Civil, Motion to dismiss. Employee Retirement Income Security Act. Federal Preemption. Statute, Federal preemption. Employment, Termination. Contract, Implied contract, Employment. Libel and Slander. This court concluded that plaintiffs’ State claims of wrongful discharge from employment in retaliation for carrying out their fiduciary obligations as trustees of an employee stock ownership plan were preempted by the Federal Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1144, where the claims “relate[d] to” the plan and where ERISA itself contained civil enforcement provisions for fiduciaries such as the plaintiffs, who sought to remedy the breach of fiduciary duty of another plan trustee. [471-476] Where a corporation’s adoption of an employee stock ownership plan was not separable from certain communications by the company’s president, who was also a trustee of the plan, a defamation claim arising from the communications was “relatefd] to” the plan and was thus preempted by the Federal Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1144. [476] Civil action commenced in the Superior Court Department on December 31, 1990. The case was heard by Charles F. Barrett, J., on a motion to dismiss. Leave to appeal was granted in the Appeals Court by Edith W. Fine, J. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Michael Sobol (Samuel M. Shafner with him) for the defendant. Robert S. Potters for the plaintiffs. Robert J. Zawacki. Greaney, J. We transferred the case to this court on our own motion to decide whether the plaintiffs’ claims of wrongful discharge and defamation are preempted by § 514 (a), 29 U.S.C. § 1144, of the Federal Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461 (1994). A judge in the Superior Court concluded that any connection between the plaintiffs’ claims and the provisions of ERISA was “too tenuous and peripheral to warrant a finding that the plaintiffs’ cause of action ‘relates to’ an employee benefit plan,” and denied the defendant’s motion to dismiss for lack of subject matter jurisdiction. See Mass. R. Civ. P. 12 (b) (1), 365 Mass. 754 (1974). A single justice of the Appeals Court properly allowed the defendant to pursue an interlocutory appeal of the denial of its motion to dismiss. See Leavitt v. Mizner, 404 Mass. 81, 87-88 (1989). We conclude that the plaintiffs’ claims are preempted by ERISA, and that the defendant was entitled to judgment on the basis of its motion to dismiss. For purposes of deciding a motion to dismiss, we accept as true the allegations in the complaint, and draw all reasonable inferences in favor of the party whose claims are the subject of the motion. See C.M. v. P.R., 420 Mass. 220, 221 (1995). The complaint, including various exhibits attached to it and incorporated by reference, makes the following allegations. The plaintiffs are former officers and directors of Savogran Company (company), a Massachusetts corporation which manufactures paint remover and other chemical-based products. On December 16, 1988, the company’s directors voted to adopt an employee stock ownership plan (plan) and to appoint the plaintiffs and Robert Lenk (then the company’s president) as the trustees of the plan. As employees of the company, the plaintiffs also were participants in the plan. Since the plan was subject to ERISA regulation, the plaintiffs and Lenk, as trustees, assumed fiduciary responsibilities for the administration of the plan. See 29 U.S.C. §§ 1101-1114. The nature and extent of these newly created duties was set out at length in a March 10, 1989, letter from counsel, addressed to the plaintiffs and Lenk. Among other things, the letter pointed out that a plan fiduciary has a responsibility to take reasonable corrective measures when he is aware that a cofiduciary has failed, or is failing, to comply with his fiduciary obligations. Compelled by their fiduciary responsibilities, the plaintiffs began to scrutinize Lenk’s conduct, and to confront him with instances of misconduct that violated his fiduciary obligations to the company and the plan. For example, during 1989 and 1990, Lenk failed to justify or document expenditures of company funds under his control, exposing the company to possible tax liability; used company funds to cover personal expenditures; and directed corporate counsel to perform personal legal services for him. Lenk also failed to make restitution for improper expenditures he had caused the company to make before the plan went into effect. In retaliation, and to avoid detection of additional misconduct on his part, Lenk accused the plaintiffs of misconduct, which resulted in their termination without cause by the company’s board of directors. In addition, Lenk circulated false and defamatory letters about the plaintiffs to a professional search finn retained by the board to seek Lenk’s replacement, and to a vice president of the United States Trust Company. 1. Wrongful termination claims. An essential premise of the complaint is that State law provides a remedy when an ERISA fiduciary is terminated in retaliation for carrying out fiduciary obligations because, under State law, that is a discharge in violation of a clearly defined public policy. Because the defendant does not argue otherwise, we assume, without deciding, that we would recognize as wrongful the termination of an employee who is discharged in retaliation for carrying out a fiduciary duty in connection with a plan governed by ERISA. See GTE Prods. Corp. v. Stewart, 421 Mass. 22, 33 (1995), and cases cited therein. See also Authier v. Ginsberg, 757 F.2d 796, 798 (6th Cir.) (concluding that Michigan would recognize as protected activity employee’s compliance with ERISA fiduciary obligations), cert. denied, 474 U.S. 888 (1985). Nonetheless, we conclude that the plaintiffs may not pursue their wrongful termination claims because those claims are preempted by ERISA. In view of existing decisional law, the conclusion that the claims are preempted would be difficult to avoid. See Kelly v. Fort Dearborn Life Ins. Co., ante 15, 16-17 (1996). Contrast Pace v. Signal Technology Corp., 417 Mass. 154, 157-158 (1994) (noting split in authority as to whether State common law claim of misrepresentation is preempted by ERISA; claim did not relate tó plan). In the case of Ingersoll-Rand Co. v. McClendon, 498 U.S. 133 (1990), the United States Supreme Court held that ERISA preempts a State law claim of wrongful discharge premised on an employer’s interference with an employee’s attainment of rights under an employee benefit plan. In the Ingersoll-Rand case, the Court observed, “[A] state law may ‘relate to’ a benefit plan, and thereby be preempted, even if the law is not specifically designed to affect such plans, or the effect is only indirect. . . . Pre-emption is also not precluded simply because a state law is consistent with ERISA’s substantive requirements.” (Citations omitted.) Id. at 139. Where the “existence of a pension plan is a critical factor in establishing liability,” id. at 139-140, a State law claim will be preempted. In addition, the Court noted, the claim brought by the plaintiff in Ingersoll-Rand conflicted directly with an existing ERISA cause of action. This fact provided an independent basis for a finding of preemption by implication. Id. at 142-145. The United States Supreme Court has not considered whether a wrongful discharge claim brought by a person in the plaintiffs’ circumstances, rather than by a plan beneficiary or participant claiming entitlement to benefits under an ERISA-governed plan, is preempted by ERISA. However, other Federal and State courts have considered the issue, and have concluded uniformly that wrongful discharge claims similar to those brought by the plaintiffs are subject to ERISA preemption. See Anderson v. Electronic Data Sys. Corp., 11 F.3d 1311, 1313-1315 (5th Cir.), cert. denied, 115 S. Ct. 55 (1994); Hashimoto v. Bank of Hawaii, 999 F.2d 408, 410-411 (9th Cir. 1993); Authier v. Ginsberg, supra at 799-802. See also McLean v. Carlson Cos., 777 F. Supp. 1480, 1483 (D. Minn. 1991) (claim by whistleblower); Andrews v. Alaska Operating Eng’rs-Employers Training Trust Fund, 871 P.2d 1142, 1144-1147 (Alaska) (same), cert. denied, 115 S. Ct. 201 (1994). These cases reason that claims, like those brought by the plaintiffs, “relate to” an employee benefit plan because such claims (1) depend on the existence of an ERISA plan, see Anderson v. Electronic Data Sys. Corp., supra at 1314; Authier v. Ginsberg, supra at 800; (2) would involve at least some inquiry at trial into the character and extent of the fiduciary duties imposed by ERISA, see Hashimoto v. Bank of Hawaii, supra at 411; McLean v. Carlson Cos., supra at 1483; and (3) would introduce inconsistency into the administration of ERISA plans because not all of the States recognize, or treat uniformly, claims of retaliatory discharge. See Authier v. Ginsberg, supra at 802. The plaintiffs’ retaliatory discharge claims clearly are subject to ERISA’s preemption provision on these bases. The plaintiffs, described in the complaint as employees at will, claim no protection from termination apart from their status as fiduciaries of an ERISA plan whose performance of their duties should be protected from adverse employment action. See Jackson v. Action for Boston Community Dev., Inc., 403 Mass. 8, 9 (1988) (as general rule, an employee at will may be terminated “for almost any reason or for no reason at all”). Their retaliatory discharge claims, therefore, depend on the existence of an ERISA plan and their status as fiduciaries of that plan. According to the allegations in the complaint, the parties’ motivations would be at issue in a trial of this case. It must be inferred, therefore, that the character and scope of the fiduciary duties mandated by ERISA would be an issue at trial on which a jury would require instructions. As the United States Court of Appeals for the Sixth Circuit observed in the Authier case, allowing a State court to “define the scope of a fiduciary’s duties under ERISA and the [remedies available to an aggrieved plaintiff] . . . runs contrary to Congress’s desire to establish a uniform federal law regulating pension plans.” Authier v. Ginsberg, supra at 802. In addition, ERISA’s “detailed and carefully balanced remedy provisions,” Anderson v. Electronic Data Sys. Corp., supra at 1314, provide remedies for fiduciaries and plan participants (as previously noted, the plaintiffs were both) seeking to remedy a breach of fiduciary duty by a plan trustee. Under ERISA, a fiduciary must, among other duties, provide “proper management, administration and investment of [plan] assets . . . and avoid[ ] . . . conflicts of interest.” Mertens v. Hewitt Assocs., 508 U.S. 248, 251-252 (1993), quoting Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 142-143 (1985). “Section 409 (a), 29 U.S.C. § 1109 (a), makes fiduciaries liable for breach of these duties, and specifies the remedies available against them: the fiduciary is personally liable for damages . . . , for restitution . . . , and for ‘such other equitable or remedial relief as the court may deem appropriate,’ including removal of the fiduciary.” Id. In turn, a cofiduciary may bring a civil action to enforce the provisions of § 409 (a), 29 U.S.C. § 1109 (a). Id. at 252-253. See 29 U.S.C. § 1132 (a) (2). See also Crawford v. Lamantia, 34 F.3d 28, 31 (1st Cir. 1994) (§ 1132 [a] [2] of 29 U.S.C. authorizes participant, beneficiary or fiduciary to bring civil action for breach of fiduciary duty proscribed by 29 U.S.C. § 1109 [a]), cert. denied, 115 S. Ct. 1393 (1995). To the extent the plaintiffs were motivated by concern about misconduct on Lenk’s part affecting the value of the plan, they could have sought relief under these provisions. Had they done so, they also might have been able to claim protection from, or redress for, termination under ERISA’s “whistleblower provision,” 29 U.S.C. § 1140, which “provides a remedy for a fiduciary [or a plan participant] who is discharged because [he or] she ‘has given information or has testified or is about to testify in any inquiry or proceeding relating to [ERISA].’ ” Hashimoto v. Bank of Hawaii, supra at 411, quoting 29 U.S.C. § 1140. Because ERISA’s civil enforcement scheme provides a remedy for persons situated as the plaintiffs were, recognition of a State law claim based on these facts would conflict impermissibly with ERISA’s civil enforcement scheme. See Ingersoll-Rand Co. v. McClendon, supra at 144; Anderson v. Electronic Data Sys. Corp., supra at 1314. The plaintiffs’ other claims of wrongful discharge also are preempted by ERISA. Both plaintiffs maintain that their termination violated an implied contractual obligation of good faith and fair dealing. An at-will employee generally does not have an enforceable claim for discharge in breach of the implied covenant of good faith unless he can establish that his discharge is contrary to a well-defined public policy. See King v. Driscoll, 418 Mass. 576, 582-583 (1994); Siles v. Travenol Labs., Inc., 13 Mass. App. Ct. 354, 358 (1992). The only such policy inferable from the complaint would be the protection of an ERISA fiduciary. Thus, the plaintiffs’ claims of discharge in breach of an implied covenant of good faith and fair dealing cannot be differentiated from the claims previously discussed, and also are preempted. See Andrews v. Alaska Operating Eng’rs-Employers Training Trust Fund, supra at 1148-1149. Faimeny’s claims of promissory estoppel and breach of an implied contract of employment for a term of years suffer from the same defect. The essential allegation in these counts is that the terms of the plan, which were devised and implemented by Faimeny, gave rise to a reasonable expectation on Faimeny’s part that he was guaranteed employment with the company for a minimum of seven years so that he would realize the full benefit of the plan. Litigation of these claims would require interpretation of the terms of the ERISA plan. Moreover, these claims are, in essence, claims by a plan participant to benefits under an ERISA-governed plan, which would have to be brought under the civil enforcement provisions of ERISA, if at all. See Dytrt v. Mountain State Tel. & Tel. Co., 921 F.2d 889, 896-897 (9th Cir. 1990) (State law claim of implied contractual obligation preempted by ERISA). 2. Defamation claims. The question with respect to the plaintiffs’ defamation claims is much closer. Damage to a plaintiff’s reputation in the business community is not a matter closely related to core concerns of the ERISA legislation. In this case, however, the company’s adoption of the plan and the communications giving rise to the defamation claims appear inseparable. Establishing the defamatory nature of Lenk’s communications, see note 5, supra, would put in issue the reason for the plaintiffs’ confrontation with him. Thus, any trial of the defamation claim inevitably would involve testimony about the provisions of the plan, the precise nature of the plaintiffs’ duties as fiduciaries, and Lenk’s alleged breach of his fiduciary obligations. These claims of defamation are inextricably bound up with the existence and content of the plan. See Ingersoll-Rand v. McClendon, supra at 140. We conclude, therefore, that these claims also “relate to” an employee benefit plan, and are preempted by ERISA. 3. Disposition. The case is remanded for entry of a judgment in favor of the defendant, Savogran Company, as to all of the remaining counts in the plaintiffs’ complaint. So ordered. Counts I through III of the plaintiffs’ amended complaint asserted a derivative action for dissipation of corporate assets, a claim of breach of fiduciary duty by Robert Lenk, the former president of the Savogran Company, and a class action claim on behalf of the participants and beneficiaries of Savogran’s Employee Stock Ownership Plan. The plaintiffs stipulated to the dismissal with prejudice of these claims. In addition, the plaintiffs stipulated to dismissal without prejudice of claims against five individual defendants, including claims against Lenk. Section 514 (a) provides that ERISA “shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan” covered by ERISA. The term “State law” encompasses “all laws, decisions, rules, regulations, or other State action having the effect of law.” 29 U.S.C. § 1144 (c) (1994). This letter was attached as an exhibit to the complaint and incorporated into it by reference. Copies of the correspondence which forms the basis of the defamation claims were attached to the complaint and incorporated by reference. In a May 29, 1990, letter to the vice president of the United States Trust Company, Lenk accused the company’s “Junior Officers” (the plaintiffs) of entering into an “unholy alliance” with members of the board of directors that “was not infact [sic] serving the employees [sic] best interests.” In a July 3, 1990, letter to the professional search firm, Lenk asserted that “two officer directors [the plaintiffs] and two attorney directors [ ] aligned against me to hire my replacement.” At oral argument, counsel for the plaintiffs suggested that, as directors of the company, the plaintiffs had a fiduciary duty to guard company assets independent of ERISA, and that the complaint should be read to state a claim on this basis. The complaint, however, asserts that the plaintiffs’ obligation to police Lenk’s conduct arose with, and was attributable entirely to, the adoption of the plan. We reject as inconsistent with the complaint the plaintiffs’ contention that their wrongful discharge claims are not preempted because the facts on which the claims are based occurred prior to the adoption of the plan. The complaint asserts that the plaintiffs were discharged for confronting Lenk about his alleged misconduct after the company’s adoption of the plan, precisely because they had assumed the role of plan fiduciaries. Moreover, as we have noted, the plaintiffs, as at-will employees, claim protection from adverse employment action on the basis of their status as plan fiduciaries whose function warrants legal protection. The wrongful discharge claims cannot logically be described as claims which arose prior to the adoption of the plan. We are not concerned in this case with an allegation that the plaintiffs were discharged so that the company, their employer, could appropriate commissions already earned and due to them. See Gram v. Liberty Mat. Ins. Co., 384 Mass. 659, 671-672 (1981); Fortune v. National Cash Register Co., 373 Mass. 96, 105-106 (1977).
Richard A. Cunningham vs. Ardrox, Inc. No. 95-P-959. Essex. March 7, 1996. April 9, 1996. Present: Brown, Greenberg, & Flannery, JJ. Jurisdiction, Nonresident, Long-arm statute, Personal. In an action brought by a Massachusetts resident against his former employer, a nonresident defendant, asserting a claim of age discrimination under 29 U.S.C. §§ 621-634, the Age Discrimination in Employment Act, the judge correctly dismissed the case for want of personal jurisdiction under G. L. c. 223A, § 3 (if), where the plaintiff did not show that the defendant caused tortious injury in Massachusetts by its acts committed outside of Massachusetts. [280-283] Civil action commenced in the Superior Court Department on September 14, 1994. The case was heard by Thayer Fremont-Smith, J., on a motion to dismiss. The case was submitted on briefs. Paul A. Manoff for the plaintiff. Harrison A. Fitch & Joshua L. Simonds for the defendant. Brown, J. The plaintiff, a Massachusetts resident, brought this action against his former employer, a nonresident defendant, in Superior Court, asserting a claim of age discrimination under 29 U.S.C. §§ 621-634 (1994), the Age Discrimination in Employment Act. Concluding that the plaintiff had failed to satisfy the literal requirements of G. L. c. 223A, § 3(d), a judge dismissed the case pursuant to Mass.R.Civ.P. 12(b)(2), 365 Mass. 755 (1974), for want of personal jurisdiction. We affirm. The plaintiff bears the burden of establishing sufficient facts upon which to predicate personal jurisdiction over the defendant under the Commonwealth’s long-arm statute. Tatro v. Manor Care, Inc., 416 Mass. 763, 767 (1994). We accept as true the uncontroverted allegations of fact taken from the materials before the motion judge. See Heins v. Wilhelm Loh Wetzlar Optical Mach. GmbH & Co. KG, 26 Mass. App. Ct. 14, 16 (1988); Kleinerman v. Morse, 26 Mass. 819, 821 n.4 (1989). The defendant, a manufacturer and seller of chemical products with markets in the United States, Canada, and Europe, is a Delaware corporation with corporate headquarters located in California. The defendant has never had any facilities or owned property in Massachusetts, or received any mail in the Commonwealth. No board of directors or shareholders meetings have been held in Massachusetts. None of the defendant’s directors and officers resides in Massachusetts. The defendant advertises in a nationally circulated publication apparently distributed in Massachusetts. Massachusetts customers account for between one and five percent of the defendant’s sales. On July 13, 1987, the plaintiff was hired to be the plant manager at the defendant’s Salem, New Hampshire, facility. On February 28, 1990, the plaintiff became the area sales manager for the defendant’s electronic chemicals division. On June 3, 1991, he was transferred to the defendant’s Arlington, Tennessee, facility to be the plant manager. On September 27, 1992, the plaintiff became the defendant’s East Coast operations manager, working out of Chicago. In March, 1993, while living in Chicago, the plaintiff purchased a condominium in Newburyport, Massachusetts, with the intention of retiring there. The plaintiff informed the company president of his intention to return to Massachusetts “upon the completion of [his] employment with [the] defendant.” In March, 1994, the plaintiff told the president and one of the defendant’s vice-presidents that the plaintiff’s wife would be moving to Massachusetts to establish legal residence there. Six weeks latjer, the plaintiff was terminated. In determining whether a Massachusetts court may exercise personal jurisdiction over a nonresident defendant, we apply a two-step analysis: (1) whether the plaintiffs assertion of jurisdiction is authorized by the long-arm statute, and (2) whether the defendant has the requisite minimum contacts with this State so that the exercise of personal jurisdiction is consistent with due process requirements. See Good Hope Indus., Inc. v. Ryder Scott Co., 378 Mass. 1, 5-6 (1979); Carlson Corp. v. University of Vt., 380 Mass. 102, 105 (1980). Jurisdiction is authorized only where the answer to both inquiries is yes. Good Hope Indus., Inc. v. Ryder Scott Co., supra at 6. Here, the plaintiff relies solely on G. L. c. 223A, § 3(d), as a basis of jurisdiction. To satisfy the first requirement of this statutory provision, the plaintiff must show that the defendant “cous[ed] tortious injury in [Massachusetts] by an act or omission [occurring] outside this [C]ommonwealth . . . .” G. L. c. 223A, § 3(d), as inserted by St. 1968, c. 760. See Keds Corp. v. Renee Intl. Trading Corp., 888 F.2d 215, 218 (1st Cir. 1989). The plaintiff argues that due to the tortious act of the defendant in wrongfully discharging him, he suffered foreseeable “economic injury” in Massachusetts (his declared domicil) sufficient to meet the literal requirements of § 3(d). We disagree. Initially, we note that it is unclear from the record before the judge exactly where the plaintiff was terminated and what the circumstances were. At the time of his termination, the plaintiff was an operations manager working and living in Chicago, Illinois. He was discharged by Nik Mallard, a resident of Great Britain. The plaintiff lists other possible witnesses to the termination as Mallard’s “senior” (a resident of Great Britain), two company vice presidents (residents of Georgia and Illinois), the president (a resident of North Carolina), and the personnel manager (a resident of California). In any event, it is undisputed that the defendant’s allegedly tortious acts were committed outside of Massachusetts. Without legal analysis, the plaintiff states that his domicil at the time of his termination was Massachusetts. As defined by the common law, a person’s domicil is usually the place where the person dwells and which forms the center of his life. See Dane v. Registrars of Voters of Concord, 374 Mass. 152, 161-162 (1978). One does not acquire a new domicil until he gives up the old one. See Levy v. Rent Control Bd. of Brookline, 29 Mass. App. Ct. 976, 977 (1990) (mere intention to change residence without physical move does not operate to change or create domicil). Domicil is a question of fact. See Teel v. Hamilton-Wenham Regional Sch. Dist., 13 Mass. App. Ct. 345, 349 (1982). Here, prior to his termination, the plaintiff was living in Chicago and, by his own admission, he intended to remain in that city an indeterminate time until his employment ended. But even if we assume that Massachusetts was his domicil when he was discharged, the plaintiff, who it is undisputed was injured outside Massachusetts, must show “tortious injury in this Commonwealth” in order to establish jurisdiction under § 3(d) of the long-arm statute. See Buckeye Assocs., Ltd. v. Fila Sports, Inc., 616 F. Supp. 1484, 1493 (D. Mass. 1985) (economic injury in Massachusetts may satisfy the requirement); Keds Corp. v. Renee Intl. Trading Corp., 888 F.2d at 218. While manifestations, effects, and consequences of an out-of-State injury may be experienced in Massachusetts, they do not constitute “injury in this commonwealth” within the meaning of § 3(d). See Crocker v. Hilton Intl. Barbados, Ltd., 976 F.2d 797, 800 (1st Cir. 1992), where, after the wife’s rape at a Barbados hotel, the plaintiffs “convalesced in Massachusetts and suffered most of the effects of the out-of-state injuries in Massachusetts.” Here, while the plaintiff may have suffered after his discharge financially and otherwise upon his move from Chicago to his retirement home in Massachusetts, this does not mean that he was “injured in” Massachusetts. See Walsh v. National Seating Co., 411 F. Supp. 564, 571 (D. Mass. 1976), in which the court rejected the contention of the plaintiff, a Massachusetts resident, that tortious injury occurred in Massachusetts because he received medical treatment and incurred his medical expenses here after a bus accident in Maine, endured pain and suffering here, and suffered impairment to his future earning capacity here. The court stated at 571, “While it is undoubtedly true that plaintiff and his wife suffered in Massachusetts this does not mean they were injured here” (emphasis original). As the plaintiff is unable to satisfy the literal requirements of § 3(d) on the facts alleged, the judge properly declined to exercise personal jurisdiction over the nonresident defendant. In light of our conclusion that the plaintiff failed to satisfy the first requirement of § 3(d), we need not discuss whether the defendant had sufficient contacts with Massachusetts to justify the exercise of personal jurisdiction over it. Nor is it necessary to address the other grounds of the judge’s decision. See Fay v. Federal Natl. Mort. Assn., 419 Mass. 782, 789 (1995); Rosenfeld v. Board of Health of Chilmark, 27 Mass. App. Ct. 621, 626 n.10 (1989). Judgment affirmed. The plaintiff! states in his affidavit (without specifying dates and locations) that he had “occasional business dealings in Massachusetts,” visiting vendors who scjld raw materials to the defendant. The plaintiff does not dispute the defendant’s assertion that after the plaintiff’s transfer to its Tennessee facility ip June, 1991, his employment duties were unrelated to the defendant’s Massachusetts customers. General Laws c. 223A, § 3(d), as amended by St. 1969, c. 623, provides in relevant part: “A court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action in law or equity arising from the person’s ...(d) causing tortious injury in this commonwealth by an act or omission outside this commonwealth if he regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered, in this commonwealth . . . .” In his complaint, the plaintiff alleged that as a result of the loss of his employment, he “has incurred damages in the nature of lost earnings, and benefits.” In his appellate brief, while stating that he suffered economic injury in Massachusetts, the plaintiff fails to elaborate on the nature of these injuries.
Dan M. White vs. Commissioner of the Department of Employment and Training. No. 94-P-1237. Middlesex. November 13, 1995. April 1, 1996. Present: Perretta, Ireland, & Flannery, JJ. Employment Security, Eligibility for benefits. Employment, Termination, Severance agreement. Statute, Construction. Words, “Remuneration,” “Severance payment.” A written agreement between an employer and an employee who was being laid off, under the terms of which the employee would receive a lump sum payment and certain other benefits through a date certain in return for the employee’s release of any and all claims against the employer, did not constitute “severance payment,” that is, payment for services previously rendered, so as to disqualify the employee from obtaining unemployment benefits, where the employee would have received nothing unless he signed the agreement. [252-254] Civil action commenced in the Marlborough Division of the District Court Department on December 16, 1993. The case was heard by Dennis J. Brennan, J. Phyllis N. Crockett, Assistant Attorney General, for the Commissioner of the Department of Employment and Training. Andrew Kisseloff for the plaintiff. Perretta, J. This is an appeal by the Department of Employment and Training (DET) from a judgment of the District Court reversing a denial of unemployment benefits to the plaintiff (employee). The employee was denied benefits on the basis of a determination that a lump sum payment to him by his former employer, Digital Equipment Corporation (Digital), was severance pay within the meaning of G. L. c. 151 A, § l(r)(3). Concluding that the lump sum payment was made to the employee in exchange for his release of Digital from any and all claims arising out of his employment and not as severance pay, we affirm the judgment. 1. Facts. We recite the facts as found by DET’s review examiner. On June 21, 1993, the employee, a senior software engineer who had been working for Digital for twelve years, was notified that he was being laid off from his employment as of June 25, 1993. Digital had been reducing its work force for several years, and the employee had no expectation of being recalled to work by Digital in the future. Because of the abruptness of the termination notice, Digital continued to pay the employee and provide him with full benefits for seven weeks, that is, up until his termination date of August 13, 1993. On July 2, 1993, the employee signed an agreement which Digital had prepared and labelled as a “TRANSITION FINANCIAL SUPPORT AGREEMENT.” Pursuant to the terms of this agreement, the employee was to receive a lump sum payment in the amount of 12.39 weeks of pay and he would be allowed to continue his participation in Digital’s health, life, and dental benefits plan for the twelve-week period of August 13, 1993, through November 6, 1993. The employee was not required to perform any services for Digital after June 25, 1993, nor was he required to repay Digital any part of the lump sum payment if he were to find employment prior to November 6, 1993. Additionally, the employee could avail himself, off premises, of “outplacement services,” which Digital would provide for six months. Digital did not participate in the DET proceedings. The employee gave a copy of the agreement to the review examiner and testified that had he not signed the agreement he would not have received the lump sum payment nor would Digital have allowed him to participate in its medical and dental plans or to use its “outplacement services.” The employee stated that as he read the agreement, he sold an asset, his right to “sue Digital for a lot of things,” including any discrimination in separating him from his employment. The agreement recites the rights released by the employee as follows: “Employee on behalf of Employee and Successors accepts the foregoing in full and complete satisfaction of any and all claims of any kind or description that Employee and Successors have, or may have had, or may have against Digital, or its officers, directors, agents, successors, assigns or employees to the date of the execution of this Agreement and releases Digital, and its officers, directors, agents, successors, assigns or employees from any liability for such claims. The effect of Employee’s signing this agreement: a. Is to prevent Employee from suing Digital, its officers, directors, agents, successors or assigns under: • any employment relations laws; • any state, federal or local law, regulation or executive order, prohibiting discrimination on account of age, race, color, sex, sexual orientation, national origin, religion, handicap or veterans status; • the Age Discrimination in Employment Act of 1967, as amended to the date of this Agreement; • common law, including without limitation, claims arising from any contract or tort law; • any law regulating the provision of employee benefits, or under any Digital benefit plan except as noted below; • any public policy, law or equity or claims for expenses, attorney’s fees, or other monetary or equitable relief or any other claim arising out, or related to Employee’s employment with, or termination from Digital; • any contract claimed as a result of a Digital policy, including but not limited to Digital’s Relocation policy; • any other claim arising out of Employee’s employment with Digital or termination of employment with Digital from his or her first employment to the date of this Agreement.” Because the amount of the lump sum payment was based upon the employee’s years of service with Digital and because the employee would continue to receive medical and dental insurance during the twelve-week period in issue, the review examiner concluded that the employee had received a “form of severance/dismissal pay,” that is, he had received remuneration which disqualified him from receiving unemployment benefits for the twelve-week period of August 13 through November 6, 1993. 2. Discussion. General Laws c. 151 A, § l(r)(3), as amended through St. 1992, c. 118, § 4, and as here pertinent, defines “remuneration” as “any consideration, whether paid directly or indirectly, including salaries, commissions and bonuses . . . received by an individual . . . (3) as termination, severance or dismissal pay, or as payment in lieu of dismissal notice . . . or as payment for vacation allowance. . . .” Although the term “severance payments” is not defined by c. 151 A, it has been discussed in several decisions in respect to its inclusion within or exclusion from the Legislature’s various amendments to the definition of remuneration in § l(r)(3). See Kalen v. Director of Div. of Employment Sec., 334 Mass. 503, 504-505 (1956); Bolta Prods. Div. v. Director of the Div. of Employment Sec., 356 Mass. 684, 688-690 & n.3(b) (1970); Itek Corp. v. Director of the Div. of Employment Sec., 398 Mass. 682, 683-685 (1986). These cases discuss the many characteristics of severance pay which resemble the present lump sum payment. As considered in Bolta Prods. Div. v. Director of the Div. of Employment Sec., 356 Mass. at 689-690, the usual attributes of severance payments are: “The total amount paid was directly related to [the employee’s] years of service. It was not subject to limitation or repayment if he obtained other employment before the expiration of three months from [the employer’s] termination of his employment. He was permanently severed from his employment . . . with no provision for being called back or rehired. All of the benefits of his employment terminated with the possible exception of vested pension rights.” Compare Itek Corp. v. Director of the Div. of Employment Sec., 398 Mass, at 685. There the court concluded that certain payments made to employees, at a time when the definition of remuneration did not include severance pay (see § 1 [r][3], as amended by St. 1976, c. 473, § 3), were paid “as a salary continuation plan to employees on inactive status.” The court distinguished the payments from severance pay on the basis that the employees “continued to receive the full array of benefits that the company provided to active employees, . . . [T]here was no separation from . . . [the company] during the plan’s operation . . . And the salary continuation would cease if the employees were to find other employment within a certain time span.” Although mindful of the similarities between severance pay and Digital’s lump sum payment to the employee, we think the fact that the employee would receive nothing unless he signed the broad release of all claims sufficiently significant to remove the payment from the definition of remuneration, and we accept the reasoning found in Moore v. Digital Equipment Corp., 868 P.2d 1170 (Colo. App. 1994), a case involving what appears to be an identical or almost identical agreement as well as substantially similar statutory provisions concerning unemployment benefits and severance pay. While noting the features common to both the lump sum payment in issue and severance pay, the Colorado court found the purpose of the payment worthy of consideration. The court determined: “[T]he written agreement between the parties demonstrates that the employer’s primary purpose in making a lump sum payment was, as the referee found, not to provide a salary substitute to secure the employee’s economic well-being during any period of unemployment. While there is self-serving language to this effect in the agreement that was unilaterally prepared by the employer, had this been the employer’s primary purpose for the payment, it would not have been conditioned on the employee’s execution of the written release” (emphasis original). Id. at 1172. We find support for our acceptance of the District Court judge’s determination of the purpose of the agreement in the fact that the agreement before us also provides that the employee was not to receive the lump sum payment until after the expiration of a waiting period during which he could revoke his acceptance of the terms. Further, we too attach little significance to the employer’s characterization of the agreement as one for “transition financial support.” See Bolta Prods. Div. v. Director of the Div. of Employment Sec., 356 Mass. at 688. Having determined the primary purpose of the agreement, the Colorado court next noted, at 868 P.2d at 1173, that “[a]n employee has no obligation, as a part of the services he or she is to provide to the employer, to renounce legal rights possessed by him or her. See, e.g., [Colo. Rev. Stat. § 8-4-110 (1986 Repl.Vol. 3B)].” Consequently, the employee’s consideration for the agreement was not services but the release of any claim that he might have against “the employer itself or against described third parties,” or, as provided in the agreement before us, its officers, directors, agents, successors, assigns or employees. As we read Moore v. Digital Equipment Corp., 868 P.2d at 1173, the decision is limited to the facts and the terms of the agreement there presented. On that same basis, we agree with the court’s conclusion: “Under these circumstances, therefore, in which the payment is not made in return for services previously rendered by the terminated employee, but is in return for a release of claims, and in which the primary purpose of such payment is to obtain such release, we conclude that the payment is not a ‘severance allowance’ within the meaning of [c. 151 A, § 1 (r)(3)].” Ibid. Judgment affirmed. This case involves a question of law, namely, the effect of an agreement between Digital and the employee upon the latter’s right to unemployment benefits, and the matter is subject to de nova judicial review. See Itek Corp. v. Director of Div. of Employment Sec., 398 Mass. 682, 684 (1986); Ruzicka v. Commissioner of Dept. of Employment & Training, 36 Mass. App. Ct. 215, 217 n.4 (1994), quoting from Raytheon Co. v. Director of Div. of Employment Sec., 364 Mass. 593, 595 (1974). There is no issue before us concerning whether these payments were made in lieu of notice and, therefore, remuneration under G. L. c. 151 A, § 1 (r)(3). The employee did not surrender any right to entitlements that he might have under benefit plans unrelated to downsizing, such as “Digital’s Pension and SAVE Plans,” and any workers’ compensation benefits. General Laws c. 151 A, §§ 35 and 36, make provision comparable to Colo. Rev. Stat. § 8-4-110 (1986 Repl.Vol. 3B).
PEARLY VEREEN, Plaintiff v. KELLY HOLDEN, Individually and In his official capacity as Brunswick County Commissioner; DONALD SHAW, Individually and In his official capacity as Brunswick County Commissioner; JERRY JONES, Individually and In his official capacity as Brunswick County Commissioner; WAYLAND VEREEN, In his official capacity as Brunswick County Commissioner; DON WARREN, In his official capacity as Brunswick County Commissioner; TOM RABON, In his official capacity as Brunswick County Commissioner; GENE PINKERTON, In his official capacity as Brunswick County Commissioner; FRANKIE RABON, In his official capacity as Brunswick County Commissioner; DAVID CLEGG, Individually and In his official capacity as Interim Manager; and BRUNSWICK COUNTY, Defendants No. COA94-1150 (Filed 5 March 1996) 1. Counties § 124 (NCI4th)— legislative immunity — tests Legislative immunity exists for county legislators, known as county commissioners in North Carolina, provided they are able to prove that they were acting in a legislative capacity at the time of the alleged incident and that their acts were not illegal acts. Am Jur 2d, Public Officers and Employees §§ 358-363. 2. Counties § 124 (NCI4th)— dismissal of county employee— defense of legislative immunity — denial of judgment on pleadings proper The trial court properly denied defendant county commissioners’ motion for judgment on the pleadings with respect to their defense of legislative immunity because it is too early in the case to determine the applicability of legislative immunity where defendants have not had the opportunity to prove either provision of the legislative immunity test, and plaintiff has alleged sufficient facts which, if true, would establish that he was dismissed from county employment in an administrative rather than legislative action which violated his constitutional rights. Am Jur 2d, Public Officers and Employees §§ 369, 370. 3. Labor and Employment § 77 (NCI4th)— wrongful termination — public policy exception to employment-at-will doctrine — sufficiency of complaint to state claim Plaintiff county employee alleged sufficient facts in his complaint to state a claim against defendant county commissioners for wrongful termination under the public policy exception to the employment-at-will doctrine where he alleged that he was fired by defendants due to his political affiliation and activities, and there was no merit to defendants’ argument that N.C.G.S. § 153A-99, which prohibits political coercion in county employment, was inapplicable because it became effective after plaintiff’s discharge, since it could still be used to demonstrate the public policy of the .State. Am Jur 2d, Wrongful Discharge § 34. Discharge from private employment on ground of political views or conduct. 51 ALR2d 742. 4. Labor and Employment § 54 (NCI4th)— breach of contract — personnel policy manual not part of contract — claim properly dismissed The trial court did not err in dismissing plaintiff’s breach of contract claim since there was no merit to plaintiff’s contention that the county personnel policy manual was part of his employment contract. Am Jur 2d, Wrongful Discharge § 97. Right to discharge allegedly “at-will” employee as affected by employer’s promulgation of employment policies as to discharge. 33 ALR4th 120. 5. Labor and Employment § 69 (NCI4th)— dismissal of county employee — violation of procedural due process— judgment on the pleadings improper The trial court erred in granting defendants’ motion for judgment on the pleadings with respect to plaintiff’s procedural due process claim, since, in order for an employee to be entitled to procedural due process protection, he has to possess a property interest or right in continued employment; a crucial factor in determining whether plaintiff possessed a property right in continued employment was whether he was wrongfully terminated or whether he was released in a bona fide RIF and thus did not experience a violation of his due process rights; and resolution of this claim involved factual proof so that judgment on the pleadings was improper. Am Jur 2d, Wrongful Discharge § 6. Rights of state and municipal public employees in grievance proceedings. 46 ALR4th 912. Termination of public employment: right to hearing under due process clause of Fifth or Fourteenth Amendment — Supreme Court cases. 48 L. Ed. 2d 996. Appeal by plaintiff and cross-appeal by defendants from order and judgment entered 28 July 1994 by Judge Jack A. Thompson in Brunswick County Superior Court. Heard in the Court of Appeals 11 September 1995. Anderson & McLamb, by Sheila K. McLamb and Laura Thompson, for plaintiff. Faison & Fletcher, by Reginald B. Gillespie, Jr., Michael R. Ortiz, and Keith D. Bums, for defendants. LEWIS, Judge. Plaintiff instituted this action for wrongful termination, restraint against free political association, violation of due process and breach of contract; he sought damages, injunctive relief, specific performance, and punitive damages. Defendants moved to dismiss plaintiff’s claims. Defendants also pled the defense of legislative immunity and moved for judgment on the pleadings. The trial court dismissed the claims designated by the plaintiff as wrongful termination, specific performance, and breach of contract as to all the defendants and dismissed the restraint against free political association claim as to some of the defendants in their individual capacities. The trial court also granted defendants’ motion for judgment on the pleadings as to the due process claim. However, the court denied defendants’ motion for judgment on the pleadings based on their defense of legislative immunity. Both plaintiff and defendants appeal. Since the claims at issue were dismissed pursuant to Rule 12(b) (6) and Rule 12(c), we look to the allegations of the plaintiff’s complaint. Essentially, the complaint alleges that Plaintiff was employed by defendant Brunswick County as an Assistant Operations Service Director and Water Coordinator. In June 1991, the Board of Commissioners of Brunswick County voted to eliminate plaintiff’s position. Plaintiff was notified on 18 June 1991, that an upcoming reduction in force (RIF) would eliminate his position. The termination came 41 days prior, to the vesting of plaintiff’s retirement benefits. His performance was satisfactory and he had never received any reprimands or indications of poor performance. We first address defendants’ contention that the trial court erred in denying their motion for judgment on the pleadings based on legislative immunity. Motions for judgment on the pleadings pursuant to Rule 12(c) are designed to “dispose of baseless claims or defenses when the formal pleadings reveal their lack of merit.” Ragsdale v. Kennedy, 286 N.C. 130, 137, 209 S.E.2d 494, 499 (1974). The movant bears the burden of proving that, after viewing the facts and permissible inferences in the light most favorable to the non-movant, he or she is entitled to judgment as a matter of law. DeTorre v. Shell Oil Co., 84 N.C. App. 501, 504, 353 S.E.2d 269, 271 (1987). The subject of legislative immunity has never before been addressed by a North Carolina appellate court. However, the United States Supreme Court has recognized the deep roots of legislative immunity in American and English common law and its application to state legislators. Tenney v. Brandhove, 341 U.S. 367, 95 L.Ed 1019 (1951). In Tenney, the Supreme Court explained the reason for legislative immunity: “In order to enable and encourage a representative of the public to discharge his public trust with firmness and success, it is indispensably necessary, that he should enjoy the fullest liberty of speech, and that he should be protected from the resentment of every one, however powerful, to whom the exercise of that liberty may occasion offence.” Tenney, 341 U.S. at 373, 95 L.Ed at 1025 (quoting II Works of James Wilson (Andrews ed. 1896) 38). Later, the Court found legislative immunity equally applicable at the regional government level. Lake Country Estates v. Tahoe Planning Agcy., 440 U.S. 391, 405, 59 L.Ed.2d 401, 413 (1979). Although the United States Supreme Court has not, a majority of federal circuit courts have extended legislative immunity to local legislators. Rini v. Zwirn, 886 F.Supp. 270, 280 (E.D.N.Y. 1995). The Fourth Circuit has acknowledged legislative immunity for county legislators, known as county commissioners in North Carolina, provided they are able to prove: (1) that they were acting in a legislative capacity at the time of the alleged incident; and (2) their acts were not illegal acts. Scott v. Greenville County, 716 F.2d 1409, 1422 (4th Cir. 1983). Because we conclude that this test fairly, succinctly and clearly states the purpose of legislative immunity, we adopt it as a test in suits against local governments and local officials. Whether an action is legislative or administrative has been determined on a case by case basis. While eliminating a position for budgetary reasons has generally been found to be legislative, e.g. Baker v. Mayor and City Council of Baltimore, 894 F.2d 679, 682 (4th Cir.), cert. denied, 498 U.S. 815, 112 L. Ed. 2d 31 (1990), overruled on other grounds, 63 F.3d 295 (4th Cir. 1995); Rateree v. Rockett, 852 F.2d 946, 950 (7th Cir. 1988), hiring, firing and other employment decisions have been held to be administrative and not deserving of legislative immunity, e.g. Alexander v. Holden, 66 F.3d 62, 67 (4th Cir 1995); Detz v. Hoover, 539 F.Supp. 532, 534 (E.D. Pa. 1982). Applying the Scott rule to the case before us, it is clearly too early in the proceedings to determine the applicability of legislative immunity. Defendants have not had the opportunity to prove either provision of the legislative immunity test. Additionally, plaintiff has alleged sufficient facts that, if true, would establish that he was dismissed in an administrative action which violated his constitutional rights. As a result, we affirm the trial court’s denial of defendants’ motion for judgment on the pleadings with respect to their defense of legislative immunity. We now address the substance of plaintiff’s assignments of error. Plaintiff first argues that the trial court erred in dismissing his wrongful termination claim because his complaint adequately states a claim under the public policy exception to the employment-at-will doctrine. We agree. A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint by determining “whether, as a matter of law, the allegations of the complaint, treated as true, are sufficient to state a claim upon which relief can be granted under some legal theory.” Lynn v. Overlook Development, 328 N.C. 689, 692, 403 S.E.2d 469, 471 (1991). A Rule 12(b)(6) motion to dismiss for failure to state a claim should not be granted unless it “appears to a certainty that plaintiff is entitled to no relief under any state of facts which could be proved in support of the claim.” Sutton v. Duke, 277 N.C. 94, 103, 176 S.E. 2d 161, 166 (1970). Ordinarily, an employee without a definite term of employment is an employee-at-will and may be discharged for any reason. Still v. Lance, 279 N.C. 254, 259, 182 S.E.2d 403, 406 (1971). However, the North Carolina Supreme Court has recognized a public policy exception to the employee-at-will rule, stating: [Wjhile 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. Coman v. Thomas Manufacturing Co., 325 N.C. 172, 175, 381 S.E.2d 445, 447 (1989) (quoting Sides v. Duke University, 74 N.C. App. 331, 328 S.E.2d 818, disc. review denied, 314 N.C. 331, 333 S.E.2d 490 (1985)). In the present case, plaintiff alleges that he was fired by defendants due to his political affiliation and activities. If true, this would contravene rights guaranteed by our State Constitution, see State v. Ballance, 229 N.C. 764, 769, 51 S.E.2d 731, 734 (1949), and the prohibition against political coercion in county employment stated in N.C. Gen. Stat. § 153A-99 (1991). As a result, if proven, these actions would surely violate North Carolina public policy. See Lenzer v. Flaherty, 106 N.C. App. 496, 515, 418 S.E.2d 276, 287, disc. review denied, 332 N.C. 345, 421 S.E.2d 348 (1992). Defendants argue that G.S. § 153A-99 is inapplicable because it became effective after plaintiff’s discharge. Nonetheless, it can still be used to demonstrate the public policy of the State. See Williams v. Hillhaven Corp., 91 N.C. App. 35, 41, 370 S.E.2d 423, 426 (1988). We hold that plaintiff has alleged sufficient facts in his complaint to state a claim for wrongful termination under the public policy exception to the employment-at-will doctrine. The decision of the trial court dismissing this claim is reversed and this matter is remanded for trial on wrongful termination. Plaintiff also argues that the trial court erred in dismissing his breach of contract claim based on the fact that the Brunswick County Personnel Policy Manual (Personnel Policy) was part of his employment contract. We are not persuaded by this argument. This Court has held that “unilaterally promulgated employment manuals or policies do not become part of the employment contract unless expressly included in it.” Walker v. Westinghouse Electric Corp., 77 N.C. App. 253, 259, 335 S.E.2d 79, 83-84 (1985), disc. review denied, 315 N.C. 597, 341 S.E.2d 39 (1986). Plaintiff relies on Trought v. Richardson, 78 N.C. App. 758, 338 S.E.2d 617, disc. review denied, 316 N.C. 557, 338 S.E.2d 18 (1986). In that case, this Court found plaintiff’s allegations that her employer’s policy manual was part of her contract sufficient to state a claim for wrongful discharge. Id. at 762, 338 S.E.2d at 620. However, in Trought, the plaintiff was required to sign a statement that she had read the personnel manual and agreed to obey the regulations it contained. Id. at 760, 338 S.E.2d at 618. Consequently, this Court determined that she had sufficiently alleged that the contract was expressly included in her employment contract as required by Walker v. Westinghouse. Id. at 762, 338 S.E.2d at 620. There are no such facts alleged in the present case. Additionally, even if the Personnel Policy was part of plaintiff’s employment contract, there was no breach. The policy specifically states that employees may be released due to a RIF. Under this section, all that is required is two weeks notice, which defendants provided. It was not error to dismiss plaintiff’s breach of contract claim. Plaintiff also assigns error to the dismissal of his “claim” for specific performance. Since we have dismissed plaintiff’s breach of contract claim, we affirm the dismissal of his specific performance “claim” as it is a remedy for breach of contract. Finally, with respect to his procedural due process claim, plaintiff argues that the trial court erred in granting defendants’ motion for judgment on the pleadings. It is well settled in North Carolina that in order for an employee to be entitled to procedural due process protection he or she has to possess a “property interest or right in continued employment.” Soles v. City of Raleigh Civil Service Comm., 119 N.C. App. 88, 91, 457 S.E.2d 746, 749 (1995). We hold that viewing the allegations as true, defendants are not entitled to judgment as a matter of law. Given this Personnel Policy, a crucial factor in determining whether, if at all, plaintiff possessed a property right in continued employment is whether or not he was wrongfully terminated. If not, he was released in a bona fide RIF as provided by the policy and has not experienced a violation of his due process rights. Since resolution of this claim involves factual proof, judgment on the pleadings was improper. We also find no need to address plaintiff’s contentions regarding the dismissal of his claim for injunctive relief. The trial court’s dismissal of this claim stemmed from its dismissal of all of the underlying claims. Since we have remanded the issue of wrongful termination, we remand this claim to the trial court to determine if injunctive relief is appropriate. For the foregoing reasons, the order and judgment of the trial court is affirmed in part, reversed in part, and remanded. Judges EAGLES and JOHN concur.
CORL v HURON CASTINGS, INC Docket No. 98054. Argued October 10, 1995 (Calendar No. 1). Decided March 1, 1996. William L. Corl brought a wrongful discharge action in the Huron Circuit Court against Huron Castings, Inc. The parties stipulated the amount of damages, reflecting a reduction for unemployment compensation benefits received, and that if the plaintiff prevailed the trial judge would determine whether the award could be enhanced by the amount of the benefits. The court, M. Richard Knoblock, J., found that the plaintiff was wrongfully discharged in violation of Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980), entered judgment following a jury verdict for the plaintiff, and, on the basis of Pennington v Whiting Tubular Products, Inc, 370 Mich 590 (1963), added the unemployment compensation benefits as stipulated. The Court of Appeals, Shepherd, P.J., and McDonald and Neff, JJ., affirmed in an unpublished memorandum opinion (Docket No. 140650). The defendant appeals. In án opinion by Justice Riley, joined by Chief Justice Brickley, and Justices Mallett and Weaver, the Supreme Court held: The collateral source rule is a tort law concept and does not apply in cases of common-law contract. In accordance with accepted principles of contract law, the plaintiff’s damage award must be reduced by the amount of unemployment compensation received. 1. The collateral source rule is a concept of tort law, providing that recovery of damages from a tortfeasor is not to be reduced by a plaintiff’s receipt of compensation for injuries from other sources. In this case, however, the plaintiff’s cause of action does not arise in ,tort; rather, it is a wrongful discharge action sounding in and governed by principles of common-law contract. Thus, the collateral source rule does not apply. 2. The Worker’s Disability Compensation Act compensates for wage loss. MCL 418.358; MSA 17.237(358) prevents duplication of worker’s compensation awards and unemployment compensation benefits and, thus, undermines the relevant language of Pennington. Pennington involved a breach of a collective bargaining agreement; therefore, its reliance on a tort action for personal injuries is misplaced. The language in Pennington supporting the deduction of unemployment compensation benefits is dicta. 3. The Legislature has developed a complex formula for the funding of unemployment compensation benefits. An employer’s liability to pay unemployment compensation arises, in part, in proportion to the amount its former employees receive in unemployment compensation benefits. In this manner an employer is ultimately responsible for its employees’ unemployment compensation claims. The extension of the collateral source rule to the area of contract law would serve no public policy goals. Reversed and remanded. Justice Cavanagh, joined by Justice Levin, dissenting, stated that the doctrine of legislative acquiescence is well established as a wisely self-imposed limitation of the appellate process. It is grounded in the court’s duty to ascertain and give effect to the legislative intent and the presumption that, when revising or amending a statute, the Legislature is aware of previous interpretations of that statute by the appellate judiciary. Failure to revise provisions previously construed by the appellate judiciary compels the assumption that the Legislature was content with such construction. The conclusion of the Supreme Court in Pennington regarding the propriety of deducting unemployment benefits from ultimate damage awards was stated with the intent that it be heeded by the trial court on remand. The Legislature’s conscious failure to express any disagreement with Pennington in its numerous revisions of the Employment Security Act gives rise to a paradigmatic situation for application of the legislative acquiescence doctrine. The judgment of the Court of Appeals in this case should be affirmed. The remedy for breach of contract is to place the nonbreaching party in as good a position as if the contract had been fully performed. However, not all contracts are fungible for purposes of this remedy. The majority mistakenly believes that payment of wages is the sole consideration an employee receives from an employer under an employment contract. The purpose of the Employment Security Act is to combat the economic insecurity due to unemployment that manifests itself in terms of lost wages and other possible incidents of a layoff that may affect a worker at an earlier or later time. The Legislature knowingly chose not to require the setoff mandated by the majority. Recouping wages alone does not put an employee in as good a position as if the employment contract had been fully performed. Justice Boyle, dissenting, stated that the Legislature’s failure to provide for setoff of unemployment benefits requires application of the collateral source rule. The issue in this case cannot be resolved by rote application of the distinction between contract and tort. Fundamentally, Toussaint is a fault-based doctrine, and its legitimate-expectations prong is an equitable principle not based on traditional contract analysis. Likewise, principles not grounded in traditional contract law have been associated with its implied-contract prong. Toussaint changed the common law, holding that personnel policies and practices could create a just-cause employment contract, even when no preemployment negotiations take place and there is no mutual assent on the subject of job security. It imposes a duty on employers to adhere to stated company policies and goals, and entitles plaintiffs to pursue a cause of action when employers breach this duty. Toussaint’,s sole ratio decidendi is that, in some circumstances, termination at will is unfair. Thus, rejection of the collateral source rule in this context cannot rest on a semantic distinction between fault-based causes of action and Toussaint claims. Because no consideration is given to collateral losses, manifestly no consideration need be given to collateral benefits that employees may have received. Allowing a setoff of the entire amount of unemployment benefits received by the plaintiff in this case is an overcredit. Michigan employers do not pay into the unemployment benefits fund dollar for dollar what the employee takes out. Although in some sense paid for by the employer in the form of a tax, the unemployment benefits are not paid by the employer to the plaintiff, but, rather, are paid by the state out of state funds. To judicially approve a full deduction to the employer would be to grant more credit than is due and to preclude reimbursement of the fund. The nature of the claim does not dictate offset by the judiciary, and the Legislature’s failure to do so indicates that it does not disapprove of Pennington. Berkley, Mengel & Vining, P.C. (by Christopher E. Mengel and Guy C. Vining), for the plaintiff. Braun, Kendrick, Finkbeiner (by John A. Decker and Scott C. Strattard) for the defendant. Riley, J. In this action for breach of employment contract, plaintiff employee was wrongfully discharged in violation of Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980). We are asked to decide whether plaintiff’s unemployment compensation benefits should be deducted from his breach of contract damage award. In accordance with accepted principles of contract law, we hold that plaintiff’s unemployment compensation benefits must be deducted from his subsequent damage award. Moreover, we conclude that this result best effectuates the intent of the Legislature by preventing the duplication of an employee’s wage loss replacement. The judgment of the Court of Appeals is reversed, and the case is remanded to the trial court for entry of an award consistent with this opinion. i Plaintiff William Corl was employed by defendant Huron Castings in July 1981. He remained an employee until he was terminated in May 1988. After his termination, he filed a wrongful discharge claim pursuant to Toussaint, supra. Before trial, the parties stipulated that plaintiff’s damages were $16,500. This figure reflected a $6,200 deduction for unemployment compensation benefits plaintiff had already received. The parties also agreed that, in the event the jury returned a verdict in favor of plaintiff, the trial judge would determine whether the award could be enhanced by $6,200. The case was tried before Judge Knoblock in the Huron Circuit Court. The jury returned a verdict for plaintiff, and, as stipulated, a judgment for $16,500 was entered. Plaintiff then petitioned the court to enhance the award by $6,200. Plaintiff argued that the unemployment compensation benefits were a collateral source and should be added to the contract damage award. On the basis of Pennington v Whiting Tubular Products, Inc, 370 Mich 590; 122 NW2d 692 (1963), the trial judge agreed and added the unemployment compensation benefits to the judgment. The judge conceded that the result was illogical, but felt obligated to follow Pennington. Defendant appealed, and the Court of Appeals affirmed in an unpublished memorandum opinion, explaining that although defendant’s argument had some merit, it was likewise constrained to follow Pennington. Defendant filed an application for leave to appeal. We granted leave and now reverse the opinion of the Court of Appeals. n We are required to assess plaintiff’s damages in this wrongful discharge action. Plaintiff pleaded and proved his case on the basis of Toussaint. In Toussaint, supra at 610, this Court stated: "We hold only that an employer’s express agreement to terminate only for cause, or statements of company policy and procedure to that effect, can give rise to rights enforceable in contract.” (Emphasis added.) The remedy for breach of contract is to place the nonbreaching party in as good a position as if the contract had been fully performed. Accordingly, the goal in contract law is not to punish the breaching party, but to make the nonbreaching party whole. A Cognizant of these principles, we evaluate plaintiff’s assertion that the collateral source rule allows full recovery from defendant notwithstanding the unemployment compensation benefits he received. The collateral source rule is a concept of tort law which provides "that the recovery of damages from a tortfeasor is not reduced by the plaintiff’s receipt of money in compensation for his injuries from other sources.” Tebo v Havlik, 418 Mich 350, 366; 343 NW2d 181 (1984) (emphasis added). In a unanimous decision by this Court in Ferrett v General Motors Corp, 438 Mich 235; 475 NW2d 243 (1991), we reaffirmed Toussaint, supra, holding that the plaintiff’s cause of action was not in tort. In Ferrett, supra at 239, the defendant brought an action for breach of contract and negligent evaluation after he was terminated for "excessive absenteeism.” We declined "to recognize an action in tort for negligent evaluation,” stating that an action could "be maintained, if at all, only for breach of a contractual obligation to evaluate.” Id. at 242. Of importance to the present case, we then announced the underlying theory for refusal to recognize a claim in tort: "We have simply the violation of a promise to perform the agreement. The only duty, other than that voluntarily assumed in the contract to which the defendant was subject, was his duty to perform his promise in a careful and skillful manner without risk of harm to others, the violation of which is not alleged. What we are left with is defendant’s failure to complete his contracted-for performance. This is not a duty imposed by the law upon all, the violation of which gives rise to a tort action, but a duty arising out of the intentions of the parties themselves and owed only to those speciñc individuals to whom the promise runs. A tort action will not lie.” [Emphasis added.] [Id. at 243, citing Hart v Ludwig, 347 Mich 559, 565-566; 79 NW2d 895 (1956).] Similarly, in the present case, we are confronted with an employer who impliedly contracted to terminate his employee for just cause. The jury held that defendant failed to fulfill his duty. This duty, however, was not imposed upon "all,” but only upon plaintiff, who impliedly contracted with defendant. Therefore, we conclude that defendant’s liability does not arise in tort. In order for plaintiff to prevail, we must extend the collateral source rule to principles of contract law. Significantly, however, plaintiff does not cite (nor have we been able to find) a single case involving breach of contract implementing the collateral source rule. Further, plaintiff’s request is in direct conflict with the fundamental precept that the remedy for breach of contract focuses on making the nonbreaching party whole. Consequently, cases relied on by plaintiff, such as Motts v Michigan Cab Co, 274 Mich 437; 264 NW 855 (1936), involving tort liability, have no application whatsoever to this case. Thus, in the face of this Court’s reluctance to extend tort remedies to cases pleaded and proven in contract, we elect to continue to distinguish between tort and contract remedies. B The present case is also distinguishable from the federal cases on which plaintiif relies. In NLRB v Gullett Gin Co, 340 US 361; 71 S Ct 337; 95 L Ed 337 (1951), the United States Supreme Court refused to deduct unemployment compensation benefits from a breach of employment contract damage award. Gullett involved employees who were discharged in violation of the Labor Management Relations Act. Cognizant of its limited power to review, the Court upheld the National Labor Relations Board’s refusal to deduct unemployment compensation benefits from the award. The nlra requires that upon a finding of unfair labor practice, the nlrb must " 'take such affirmative action including reinstatement of employees with or without back pay, as will effectuate the policies of this Act Gullett, supra at 362. In Gullett, supra at 364, the Court explained that allowing the employee to collect unemployment compensation from the State of Louisiana "may reasonably be considered to effectuate the policies of the Act.” Gullett is distinguishable because it involved employees who were discriminatorily discharged. Thus, the Court merely held that it was within the nlrb’s discretion to allow the discharged employees to collect unemployment compensation because it would effectuate the policies of that specific act. The goals of and the policies surrounding the nlra distinguish Gullett from the present case. In fact, upon finding an unfair labor practice, the board was obligated to "issue a cease and desist order requiring the guilty party 'to take such affirmative action including reinstatement of employees with or without back pay, as will effectuate the policies of [the] Act ....’” Id. at 362 (emphasis added). However, here we address a case of wrongful discharge that gives rise to an action for breach of contract only. As such, we are unable to attribute "guilt” to one of the parties in the same manner as in Gullett. We are persuaded that Gullett is more accurately analyzed in conjunction with United Protective Workers of America v Ford Motor Co, 223 F2d 49 (CA 7, 1955). In Ford, the United States Court of Appeals for the Seventh Circuit held that Ford Motor Company improperly required an employee to retire. The trial judge reduced the employee’s damages by the amount of social security and annuity payments he received between the period in which he was wrongfully retired and the date on which he was required to retire. The court distinguished Gullett, stating that it did not require a deduction of unemployment compensation benefits: The cases speak only of the National Labor Relations Board’s power to award back pay under the Act without deductions of any amounts other than for wages or earnings received during the period. They are not decisive as to the propriety of deductions which should be made in determining the amount of damages in a common law action for damages for the breach of an employment contract. [Ford, supra at 53.] The court correctly narrowed the focus of its decision to the proper amount of damages for breach of contract. The court noted that if the employee had not been improperly required to retire, he would not have received the social security or annuity payments, and, therefore, if they were not deducted, the employee would receive "more than he would have if the contract had not been breached.” Id. Perhaps more persuasive, the case was distinguished from an action sounding in tort that would be subject to the collateral source rule. In this regard the court held: We have been unable to find a single case in which this rule has been carried over to contract damages. In the absence of any binding precedent to the contrary we prefer to follow here the ordinary contract measure of damages rather than the rule in tort cases. [Id. at 54.] Similarly, the present case is governed by principles of common-law contract. Toussaint, supra. Thus, in contrast to Gullett, plaintiff’s claim is not governed by statute. hi Plaintiff, relying on Pennington, supra, argues that unemployment compensation benefits may not be deducted from a contract damage award. For this reason, a careful reevaluation of the applicability and underlying integrity of Pennington is necessary. We cautiously review this Court’s decision in Pennington mindful of stare decisis principles: The rule of stare decisis establishes uniformity, certainty, and stability in the law, but it was never intended to perpetuate error or to prevent the consideration of rules of law to be applied to the ever-changing business, economic, and political life of a community. Only in the rare case when it is clearly apparent that an error has been made, or changing considerations result in injustice by the application of an outmoded rule, should we deviate from following the established rule. [Parker v Port Huron Hosp, 361 Mich 1, 10; 105 NW2d 1 (1960).][] In Pennington, employees of a manufacturing company brought an action for breach of an employment contract. Whiting Tubular Products went out of business and was offered for sale. Two newly organized companies purchased Whiting, transferred Whiting’s machinery to a new plant, and began operations shortly after Whiting shut down its operations. The employees alleged that the two newly formed entities were organized in order to take over the business of Whiting, and that both companies were wholly controlled by Whiting who acted as a sales representative. The plaintiffs alleged that the reorganization was executed so that Whiting could avoid its obligations under its employment contracts. The primary issue on appeal involved the sufficiency of proof with regard to each claim. However, the Court further held, in what may be characterized as dicta, that it was error for the trial judge to instruct the jury that payments received by the employee under the Employment Security Act, MCL 421.1 et seq.; MSA 17.501 et seq., must be deducted from a damage award for breach of employment contract: We conclude . . . that the trial judge was in error in his direction to the jury. The purpose of the employment security act as set forth by the legislature in section 2 thereof indicates the object sought to be attained was the promotion of the public good and general welfare of the people of the State. There is nothing in the act to suggest that the payment of unemployment compensation is to be construed as in lieu of wages. [Id. at 600-601. Citations omitted.] This language in Pennington was premised on the fact that the Legislature gave no indication whether unemployment compensation replaced wage loss. However, the Legislature has subsequently manifested its intent to construe unemployment compensation as redress for wage loss. In 1980, the Legislature enacted MCL 418.358; MSA 17.237(358), which requires a worker’s compens
Lisa A. Prader vs. Leading Edge Products, Inc. No. 94-P-476. Worcester. November 2, 1995. January 19, 1996. Present: Brown, Kass, & Porada, JJ. Federal Labor Standards Act. Labor, Discharge. Public Policy. Employment, Termination, Sexual harassment. Practice, Civil, Affidavit. In a civil action the judge correctly ordered summary judgment for the defendant employer where the plaintiff asserted no facts in support of her claims that she was discharged in violation of the anti-retaliation provision of the Fair Labor Standards Act, 29 U.S.C. § 215 (a) (3) [617-618], or for a reason contrary to public policy [618-619], or that she was subject to sexual harassment in her work place [619-620]. The judge in a civil action did not err in refusing to strike, on hearsay grounds, portions of an affidavit submitted in support of a motion for summary judgment where a copy of the affiant’s deposition was filed that clarified the statements in the affidavit. [620] Civil action commenced in the Superior Court Department on October 15, 1992. The case was heard by Charles J. Hely, J., on a motion for summary judgment. James M. Parker for the plaintiff. Howard M. Brown for the defendant. Porada, J. After the plaintiff was fired by the defendant, she filed a complaint in the Superior Court alleging wrongful termination on the grounds that her discharge constituted a violation of the Fair Labor Standards Act, 29 U.S.C. §§ 215(a) (3) and 216(b) (1988), and the public policy which permits an employee to report an alleged criminal violation by her employer to the police. She also claimed that her employer’s conduct violated the Massachusetts sexual harassment law, G. L. c. 214, § 1C. The defendant filed a motion for summary judgment based on the ground that the plaintiff failed to meet her burden of proof that the employer’s conduct constituted a violation of law. Kourouvacilis v. General Motors Corp., 410 Mass. 706, 716 (1991). The Superior Court judge agreed and entered judgment for the defendant. The plaintiff appeals, claiming: (1) that she had produced sufficient evidence at the summary judgment stage to meet her burden and (2) that the judge erred in failing to allow her motion to strike parts of an affidavit submitted by the defendant in support of its motion for summary judgment. We affirm. 1. Federal Labor Standards Act claim. The plaintiff asserts that the defendant violated the anti-retaliation provision of the Fair Labor Standards Act, 29 U.S.C. § 215(a) (3). Under § 215(a) (3) of the Act, if the immediate cause or motivating factor of a discharge is the employee’s assertion of statutory rights, then the discharge of the employee constitutes a violation even if other grounds for discharge exist. If the employee’s assertion of statutory rights is not the motivating factor, however, then the discharge is not unlawful. Martin v. Gingerbread House, Inc., 977 F.2d 1405, 1408 (10th Cir. 1992). Here, the only fact asserted by the plaintiff to support her claim was that she was one of eight employees who received back pay awards for overtime work following an investigation by the Department of Labor. The defendant averred, however, that none of the other employees who received back pay awards was fired and that the plaintiff was fired because of numerous complaints from customers and staff about her uncooperative attitude. The defendant’s reason for firing the plaintiff was buttressed by a written performance evaluation by the plaintiff’s immediate supervisor some months prior to her receipt of the back pay award which, although in general favorable to the plaintiff, stated that the plaintiff needed improvement in the following categories: attitude, tact, communication and courtesy. Accordingly, the plaintiff failed to meet her burden of demonstrating a causal link between her discharge and her receipt of back pay. See Hoeppner v. Crotched Mountain Rehabilitation Ctr., Inc., 31 F.3d 9, 14 (1st Cir. 1994) (conclusory allegation of retaliation unsupported by specific facts is insufficient to survive summary judgment). 2. Public policy claim. The plaintiff claims that her employment was terminated on October 23, 1991, because of a complaint for assault and battery that she filed against her supervisor, Margaret Cardamone, with the Westborough police department. She alleges that on September 27, 1991, the two of them got into a verbal confrontation at work and as she started to walk away, Cardamone grabbed her arm, started to shake it, and uttered obscenities at her. The plaintiff reported the incident to management and the police. There is no dispute that the plaintiff was an at-will employee of the defendant. As such, her employment could be terminated at any time for any reason or for no reason at all. Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 668 n.6 (1981). Relief may, however, be had in some circumstances where an at-will employee’s termination is contrary to public policy. Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., 404 Mass. 145, 149-150 (1989). “Redress is available for employees who are terminated for asserting a legally guaranteed right (e.g., filing workers’ compensation claim), for doing what the law requires (e.g., serving on a jury), or for refusing to do that which the law forbids (e.g., committing perjury).” Ibid. Another public policy basis for imposing liability is where there has been retaliation for the performance of an important public deed. See Flesner v. Technical Communications Corp., 410 Mass. 805, 810-811 (1991). The plaintiff has not specified which of the categories of public policy violation her situation falls into. Arguably, it falls into the category of assertion of her legally guaranteed rights. Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., 404 Mass, at 149. Nevertheless, assuming she could not be fired for reporting the incident to the police, it is not enough for her to assert that she was fired for that reason. She was required to produce evidence sufficient to meet her burden of proving a causal relationship between the two events. Although she alleged that she told two other employees that she had filed a police report against Cardamone, there was no evidence that those individuals played any role in the decision to fire her nor was there evidence that the president of the defendant corporation, who made the decision to fire the plaintiff because of her uncooperative attitude, was even aware that she had filed a police report. Absent such evidence, the claim fails. Brunner v. Stone & Webster Engr. Corp., 413 Mass. 698, 704 (1992). 3. Sexual harassment claim. The plaintiff alleges that the excessive use of profanity in the defendant’s work place, particularly from Cardamone, resulted in a sexually hostile work place and, thus, constituted a violation of G. L. c. 151B, § 1(18). Here, the plaintiff’s claim fails, because she produced no evidence that those remarks constituted sexual harassment as defined by the statute or were directed to her based on her sex. See Lipsett v. Rive-Mora, 669 F. Supp. 1188, 1199 (D. P.R. 1987), and cases collected therein. Although the words used by Cardamone do have an explicit sexual connotation, their meaning and usage is not limited to that connotation. Her words amounted to no more than crass garden-variety expletives; they were not sexual commands or lurid innuendos. While scenarios can exist in which explicit sexually charged language alone constitutes harassment, see, e.g., Moffett v. Gene B. Glick Co., 621 F. Supp. 244, 269-270 (N.D. Ind. 1985), the “culture of profanity” in existence at the defendant’s work place, although offensive to the plaintiff, simply was not a form of sexual harassment. Cf. Ramsdell v. Western Mass. Bus Lines, Inc., 415 Mass. 673 (1993). As one Federal court astutely observed, “Title VII is not a clean language act. . . .” Scott v. Sears, Roebuck & Co., 798 F.2d 210, 213 n.2 (7th Cir. 1986), quoting from Katz v. Dole, 709 F.2d 251, 256 (4th Cir. 1983). We similarly conclude that G. L. c. 151B, § 1(18), does not mandate “clean language” in the work place. 4. Motion to strike. The plaintiff claims the motion judge erred in refusing to strike portions of an affidavit of the defendant’s manager of human resources filed by the defendant in support of its motion for summary judgment. The plaintiff claims those portions should have been struck as hearsay. We conclude that any deficiencies in the affidavit were cured by the defendant’s filing with the court a copy of the manager’s deposition which clarified the statements contained in her affidavit. Judgment affirmed. Sexual harassment is defined as “sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature when (a) submission to or rejection of such advances, requests or conduct is made either explicitly or implicitly a term or condition of employment or as a basis for employment decisions; (b) such advances, requests or conduct have the purpose or effect of unreasonably interfering with an individual’s work performance by creating an intimidating, hostile, humiliating or sexually offensive work environment.” G. L. c. 151B, § 1(18), as amended through St. 1986, c. 588, § 2. The plaintiff complains that the supervisor referred to her as a “cocksucker” and “a fucking . . . .”
PATRICIA GRAHAM, Plaintiff-Appellant v. HARDEE’S FOOD SYSTEMS, INC., Defendant-Appellee No. 9418SC449 (Filed 16 January 1996) 1. Judgments § 268 (NCI4th); Trial § 226 (NCI4th)— second dismissal against employee — derivative claims against employer barred Plaintiff’s second voluntary dismissal against defendant employee operated to bar her derivative claims against defendant employer, including a claim for negligent supervision and retention. N.C.G.S. § 1A-1, Rule 41(a)(1)(h). Am Jur 2d, Dismissal, Discontinuance, and Nonsuit §§ 73-77. What dismissals preclude a further suit, under federal and state rules regarding two dismissals. 65 ALR2d 642. 2. Labor and Employment § 68 (NCI4th)— constructive wrongful discharge — insufficient evidence The North Carolina courts have not yet adopted the tort of constructive wrongful discharge. Assuming the existence of such a cause of action, the trial court did not err by dismissing plaintiff’s claim where there was no evidence of intolerable conditions deliberately created by the employer to force plaintiff to leave her job. Am Jur 2d, Job Discrimination §§ 1091-1099; Wrongful Discharge § 8. Modern status of rule that employer may discharge at-will employee for any reason. 12 ALR4th 544. Circumstances in Title VII employment discrimination cases (42 USCS secs. 2000e et seq.) which warrant finding of “constructive discharge” of discriminatee who resigns employment. 55 ALR Fed. 418. When is work environment intimidating, hostile, or offensive, so as to constitute sexual harassment in violation of Title VII of Civil Rights Act of 1964, as amended (42 USCS secs. 2000e et seq.). 78 ALR Fed. 252. 3. Negligence § 6 (NCI4th)— negligent infliction of emotional distress — insufficient evidence Plaintiffs claim against her former employer for negligent infliction of emotional distress must fail where plaintiff’s second dismissal of her claim against a district manager relieved the employer of liability under a theory of ratification of the district manager’s improper conduct, and plaintiff presented no evidence of extreme and outrageous conduct by the employer. Am Jur 2d, Fright, Shock, and Mental Disturbance § 44.5; Wrongful Discharge § 159. Liability of employer, supervision or manager for intentionally or recklessly causing employee emotional distress. 52 ALR4th 853. Appeal by plaintiff from order entered 2 December 1993 by Judge Russell G. Walker in Guilford County Superior Court. Heard in the Court of Appeals 21 March 1995. Plaintiff filed suit 3 June 1991 against defendants Hardee’s Food Systems, Inc. (Hardee’s) and Ronald Rogers, a Hardee’s district manager, for assault and battery, intentional infliction of emotional distress, wrongful termination, and negligent hiring and retention of an employee. Plaintiff based her claims upon alleged sexual advances, untoward comments, and uninvited touchings made by Rogers. Plaintiff took a voluntary dismissal without prejudice as to both defendants on 27 November 1991. Plaintiff refiled against both defendants on 4 November 1992, asserting the same causes of action as the earlier complaint, with the addition of a claim for punitive damages. After extensive discovery, Hardee’s moved for summary judgment. Before the hearing on Hardee’s motion, plaintiff voluntarily dismissed her claim against Rogers. The trial court granted Hardee’s motion for summary judgment on all claims in an order filed 2 December 1993. From this order, and an earlier order granting Hardee’s motion to suppress plaintiff’s changes to deposition testimonies, plaintiff appeals. Joseph Edward Downs and Jeffrey S. Lisson, for plaintiff - appellant. Blakeney & Alexander, by W T Cranfill, Jr., and Michael V. Matthews, for defendant-appellee. McGEE, Judge. The crucial issue in this case is whether plaintiff’s second voluntary dismissal against Ronald Rogers operates to bar her derivative claims against Hardee’s. We hold that it does and affirm the granting of summary judgment for Hardee’s. “[A] notice of dismissal operates as an adjudication upon the merits when filed by a plaintiff who has once dismissed in any court of this or any other state or of the United States, an action based on or including the same claim.” N.C.R. Civ. P. 41(a)(l)(ii). Such a dismissal is with prejudice, and it operates as a disposition on the merits and precludes subsequent litigation in the same manner as if the action had been prosecuted to a full adjudication against the plaintiff. Barnes v. McGee, 21 N.C. App. 287, 289, 204 S.E.2d 203, 205 (1974). As our Supreme Court has said: “It is fundamental that a final judgment, rendered on the merits, by a court of competent jurisdiction, is conclusive of rights, questions and facts in issue, as to the parties and privies, in all other actions involving the same matter. . . . (W)hen a fact has been agreed upon or decided in a court of record, neither of the parties shall be allowed to call it in question, and have it tried over again at any time thereafter, so long as the judgment or decree stands unreversed.” Masters v. Dunstan, 256 N.C. 520, 523-24, 124 S.E.2d 574, 576 (1962) (citations omitted). Since plaintiff twice dismissed her claims against Rogers, this served as an adjudication in his favor upon the merits. Plaintiff is precluded from retrying these issues or calling into question any alleged wrongdoing by Rogers in her action against Hardee’s based upon the conduct of Rogers. Plaintiff argues the trial court erred in granting summary judgment for Hardee’s on her claims of negligent supervision and retention, wrongful discharge, negligent infliction of emotional distress, and punitive damages, claiming these actions are independent of her claims against Rogers. However, contrary to plaintiffs contentions, each of these claims as presented by plaintiff is dependant upon the alleged tortious conduct of Rogers. Since Rogers has been adjudicated not liable for the alleged conduct as a result of plaintiff’s second voluntary dismissal of her claims against him, the remaining claims against Hardee’s must also fail. As to plaintiff’s first claim, before an employer will be held liable for the tort of negligent retention and supervision of an employee, “plaintiff must prove that the incompetent employee committed a tor-tious act resulting in injury to plaintiff and that prior to the act, the employer knew or had reason to know of the employee’s incompetency.” Hogan v. Forsyth Country Club Co., 79 N.C. App. 483, 495, 340 S.E.2d 116, 124, disc review denied, 317 N.C. 334, 346 S.E.2d 141 (1986). The only tortious conduct by an employee of Hardee’s that plaintiff has alleged is the acts of Rogers which were the basis of her claims against him. As a result of the second dismissal of her claims against Rogers, it has been judicially determined that Rogers is not liable for any tortious conduct. Therefore, plaintiff has not shown that an employee of Hardee’s committed a tortious act and this cause of action fails. Plaintiff next argues the trial court erred in dismissing her claim for wrongful discharge. Plaintiff admits she quit her job and was never fired by Hardee’s. However, she claims Hardee’s is liable for wrongful discharge because they made her working conditions “intolerable,” resulting in a “constructive discharge.” We first note that North Carolina courts have yet to adopt the employment tort of constructive discharge. The Fourth Circuit Court of Appeals, which does recognize constructive discharge as a cause of action, has said that a plaintiff alleging constructive discharge “must demonstrate that the employer deliberately made working conditions intolerable and thereby forced [the plaintiff] to quit.” E.E.O.C. v. Clay Printing Co., 955 F.2d 936, 944 (4th Cir. 1992). “Deliberateness exists only if the actions complained of ‘were intended by the employer as an effort to force the employee to quit’ ”. Id. (Citations omitted). Assuming, arguendo, we accept the existence of a cause of action for constructive discharge, the record on appeal contains no evidence of intolerable conditions deliberately created by Hardee’s to force plaintiff to leave her job. “[W]hen the moving party presents an adequately supported motion [for summary judgment], the opposing party must come forward with facts, not mere allegations, which controvert the facts set forth in the moving party’s case, or otherwise suffer a summary judgment.” Connor Co. v. Spanish Inns, 294 N.C. 661, 675, 242 S.E.2d 785, 793 (1978). We note plaintiff has made several unsuccessful attempts to have additional materials added to the record which she claims contain evidence of acts by Hardee’s to create intolerable working conditions. However, the transcript shows these materials were not properly tendered for consideration on defendant’s motion for summary judgment and were not considered by the trial court. They are not part of the official record, and therefore, are not properly before us and we may not consider them. See N.C.R. App. P. 9 (“[R]eview is solely upon the record on appeal and the verbatim transcript of proceedings. . . .”) The only forecast in the record of intolerable conditions is the allegations contained in the complaint. Further, the record contains no evidence these alleged conditions were deliberately created or allowed to continue by Hardee’s in an attempt to force plaintiff to quit. Plaintiff has no cause of action under a theory of constructive discharge. Even if plaintiff could prove a constructive discharge, in order to state a claim for a wrongful discharge as an at-will employee, she would still have to prove the discharge was in contravention of North Carolina public policy or statute. See Coman v. Thomas Manufacturing Co., 325 N.C. 172, 381 S.E.2d 445 (1989). The only allegations made by plaintiff which could show a violation of public policy or statute involve the claims against Rogers for which it has been judicially determined he is not liable. Since plaintiff cannot prove a constructive discharge, and she was never fired by Hardee’s, her claim for wrongful discharge fails. Likewise, plaintiff’s claim for negligent infliction of emotional distress must also fail. As plaintiff admits in her brief, her second dismissal of Rogers relieved Hardee’s of liability under a theory of ratification of Roger’s conduct. To show an independent cause of action against Hardee’s, plaintiff needed to present facts showing Hardee’s engaged in extreme and outrageous conduct intended to cause, and which did in fact cause, severe emotional distress. See Bryant v. Thalhimer Brothers, Inc., 113 N.C. App. 1, 7, 437 S.E.2d 519, 522 (1993), disc. review denied and appeal dismissed, 336 N.C. 71, 445 S.E.2d 29 (1994). As discussed above, plaintiff, as the non-movant, must come forward with facts to counter a proper motion for summary judgment. The official record contains no factual evidence showing Hardee’s engaged in extreme or outrageous conduct. The only forecast of evidence concerning Hardee’s conduct is the allegation in the complaint that Hardee’s “sanctioned, condoned, and ratified Rogers’ improper, illegal, and tortious conduct.” Since plaintiff presented no evidence of éxtreme and outrageous independent acts of Hardee’s, summary judgment for defendant on plaintiff’s claim for negligent infliction of emotional distress was proper. Plaintiff’s brief did not contain an argument concerning her assignment of error involving the grant of defendant’s motion to suppress changes to deposition testimony, and this assignment of error is deemed abandoned. N.C.R. App. P. 28(a). Because of our holding, we need not discuss plaintiff’s remaining assignments of error and arguments. The trial court’s grant of summary judgment in favor of Hardee’s is affirmed. Affirmed. Judges JOHNSON and COZORT concur.
Freenezetter Ashford vs. Massachusetts Bay Transportation Authority & others. Suffolk. October 3, 1995. December 26, 1995. Present: Liacos, C.J., Abrams, Lynch, Greanby, & Fried, JJ. Practice, Civil, Interlocutory appeal, Injunctive relief. Appeals Court, Concurrent jurisdiction, Appeal from order of single justice, Direct appellate review by the Supreme Judicial Court. Supreme Judicial Court, Jurisdiction. Injunction. Discussion of the interlocutory review procedures set forth in G. L. c. 231, § 118. [565-568] This court dismissed the complaint of a litigant who did not follow the procedures set forth in G. L. c. 231, § 118, first and second pars., in Mass. R. A. P. 6 (a), or in G. L. c. 211 A, § 10, in seeking injunctive relief or in seeking review of the denial of her request for injunctive relief. [568] This court stated that henceforth sanctions may be imposed for a litigant’s or attorney’s improper appeal. [568-569] Civil action commenced in the Supreme Judicial Court for the county of Suffolk on October 28, 1994. The case was heard by O’Connor, J. Sanford A. Kowal for the plaintiff. Sandra DeSantis for Massachusetts Bay Transportation Authority & others. John McMahon, for Local Division 589, Amalgamated Transit Union & another, was present but did not argue. Local Division 589, Amalgamated Transit Union; Thomas McGary; Alice McLaughlin; and Richard Murphy. Abrams, J. The plaintiff, Freenezetter Ashford, appeals from the denial by a single justice of this court of her request for injunctive relief. Relying on G. L. c. 231, § 118, first and second pars. (1994 ed.), and G. L. c. 231, § 112 (1994 ed.), Ashford appealed to the Supreme Judicial Court for Suffolk County (single justice session) after a single justice of the Appeals Court denied her motion requesting that the Massachusetts Bay Transportation Authority (MBTA) be ordered to reinstate her as a bus driver. For the reasons stated below, we conclude that this appeal should be dismissed. 1. Facts. On December 14, 1992, Ashford was terminated from her job as a bus driver with the MBTA after the MBTA investigated an incident in which she allegedly assaulted another employee. According to the MBTA, Ashford was terminated for four violations of MBTA rules and for her unsatisfactory disciplinary record. Ashford filed a complaint in the Superior Court against the. MBTA, alleging racial discrimination and violations of 42 U.S.C. §§ 1981, 1983, 1985; Title VII of the Civil Rights Act of 1963; G. L. c. 151B (1994 ed.); G. L. c. 93, § 102 (1994 ed.); and Massachusetts common law. She also filed a complaint against Local Division 589, Amalgamated Transit Union, for violation of its duty of fair representation and for failure to take her grievance to arbitration. She also sought damages from three individuals involved in her discharge. In the Superior Court, Ashford moved for a preliminary injunction ordering the MBTA to reinstate her. She asserted that the loss of her job was an irreparable injury, because, due to the delay inherent in litigation, she could not be adequately compensated by any future damage award. Ashford therefore concluded that she had no adequate remedy at law. A Superior Court judge denied the motion, determining that Ashford had not proved a likelihood of success on the merits and that she had an adequate remedy at law. Ashford en- tered a complaint pursuant to G. L. c. 231, §§ 118 and 112, in this court seeking the grant of the preliminary injunction that had been denied in the Superior Court. The clerk correctly transferred the case to the Appeals Court, and a single justice of the Appeals Court denied Ashford’s request for relief. Ashford then appealed to a single justice of this court. That was error. 2. Procedure. It is settled that absent “special authorization,” Cappadona v. Riverside 400 Function Room, Inc., 372 Mass. 167, 169 (1977), “an appellate court will reject attempts to obtain piecemeal review of trial rulings that do not represent final dispositions on the merits.” R.J.A. v. K.A.V., 34 Mass. App. Ct. 369, 372 (1993). General Laws c. 231, § 118, provides such authorization in a narrow range of cases. The first and second paragraphs of § 118 describe two distinct interlocutory procedures. See Packaging Indus. Group, Inc. v. Cheney, 380 Mass. 609, 615 (1980); Demoulas Super Mkts., Inc. v. Peter’s Mkt. Basket, Inc., 5 Mass. App. Ct. 750, 752 n.3. (1977). The first paragraph allows a litigant to petition the appropriate appellate court. The “appropriate appellate court” is the court — either this court or the Appeals Court — “in which any ultimate appeal of the completed case would have to be entered.” Foreign Auto Import, Inc. v. Renault Northeast, Inc., 367 Mass. 464, 470 (1975). The Appeals Court is the appropriate appellate court if it has concurrent jurisdiction with this court. G. L. c. 211 A, §§ 1, 10 (1994 ed.). Commonwealth v. Friend, 393 Mass. 310, 313 (1984). See Appeals Court Rule 2:01 (1995). Generally, the Appeals Court has concurrent jurisdiction over matters arising in Superior Court. G. L. c. 211 A, § 10. In a case like this, the petition referred to in § 118, first par., is a pleading (complaint) submitted to a single justice of the appropriate court requesting injunctive relief. Foreign Auto Import, supra at 469-470. The single justice “enjoys broad discretion to deny the petition, or to ‘modify, annul or suspend the execution of the [trial court’s] interlocutory order,’ ... or, finally, to report the request for relief to the appropriate appellate court.” Packaging Indus. Group, supra at 614, quoting Rollins Envtl. Servs., Inc. v. Superior Court, 368 Mass. 174, 181 (1975). Accord Gibbs Ford, Inc. v. United Truck Leasing Corp., 399 Mass. 8, 10 n.8 (1987). This authority includes the power to grant an injunction that has been denied in the Superior Court. See Edwin R. Sage Co. v. Foley, 12 Mass. App. Ct. 20, 22-25 (1981). An Appeals Court single justice’s grant of injunctive relief is immediately appealable to a panel of the Appeals Court. Nabhan v. Selectmen of Salisbury, 12 Mass. App. Ct. 264, 269 (1981). So too, the order of a single justice of this court granting injunctive relief is immediately appealable to this court. See Rollins Envtl. Servs., Inc. v. Superior Court, 368 Mass. 174, 181 (1975). The denial of injunctive relief is not reviewable “unless the single justice has reported his action to the full court or has allowed a petition requesting interlocutory appellate review.” Carista v. Berkshire Mut. Ins. Co., 394 Mass. 1009, 1009-1010 (1985), quoting Corbett v. Kargman, 369 Mass. 971, 971-972 (1976). Rollins Envtl. Servs., Inc., supra at 181. Nabhan, supra at 266. The second paragraph of G. L. c. 231, § 118,allows a litigant a direct appeal from the order of the trial judge granting or denying injunctive relief. See Packaging Indus. Group, supra at 613 (“We also conclude, as a matter of Massachusetts practice, that appeals pursuant to G. L. c. 231, § 118, second par., properly lie to the Appeals Court, or, in an appropriate case, to this court, rather than to a single justice of either court”); Gibbs Ford, supra at 10 n.8. See also Demoulas Super Mkts., supra at 751-752 & n.3 (“the procedure for taking an appeal [pursuant to § 118, second par.] ... is precisely the same as that for taking an appeal from a final judgment”). After an appeal under G. L. c. 231, §118, second par., is properly entered in the Appeals Court, the litigant has twenty days to petition this court for direct appellate review. See G. L. c. 211 A, § 10 (A); Mass. R. A. P. 11, as amended, 378 Mass. 938 (1979). Although the first and second paragraphs of G. L. c. 231, § 118, offer distinct avenues of relief, see Packaging Indus., supra at 615, a party taking an appeal from the denial of a request for injunctive relief pursuant to the second paragraph also may seek temporary relief, available at the discretion of the single justice, pursuant to the first paragraph. Id. at 614. Edwin R. Sage Co. v. Foley, supra at 22, 24. See Demoulas Super Mkts., supra at 754 (if relief from full court pursuant to § 118, second par., is proper, relief pursuant to § 118, first par., from single justice is an available alternative). Alternatively, a litigant may, pending appeal, seek temporary relief pursuant to Mass. R. A. P. 6 (a), as amended, 378 Mass. 930 (1979), which provides in pertinent part: “In civil cases, an application ... for an order suspending, modifying, restoring or granting an injunction during the pendency of an appeal . . . may be made to the appellate court or to a single justice . . . .” Ashford’s complaint pursuant to G. L. c. 231, § 118, first par., was heard and denied by a single justice of the Appeals Court. Absent a report, that decision may not be reviewed until the entire case is ripe for review. Nabhan, supra at 266. Ott v. Preferred Truck Leasing, Inc., 9 Mass. App. Ct. 875, 876 (1980). The single justice did not, however, dispose of Ashford’s appeal pursuant G. L. c. 231, § 118, second par., because that appeal lay directly to the Appeals Court. Ash-ford could have asked the single justice to expedite that appeal or to grant relief (pursuant to either G. L. c. 231, § 118, first par., or Mass. R. A. P. 6 [a]), pending that appeal. After entering her appeal in the Appeals Court, Ash-ford could have applied to this court for direct appellate review. G. L. c. 211 A, § 10. Mass. R. A. P. 11. Ashford followed none of these procedures. Instead, after the Appeals Court single justice denied her request for relief, Ashford appealed directly to a single justice of this court. Neither G., L. c. 231, § 118, nor our caselaw, permits a civil litigant to proceed from one single justice session to another in this manner. Therefore, neither Ashford’s complaint pursuant to G. L. c. 231, § 118, first par., nor her appeal pursuant to G. L. c. 231, § 118, second par., are properly before us. We take this opportunity to remind litigants and their attorneys that, “[bjecause of the delay and wastework which improper appeals necessarily entail, the perpetrator [either litigant or attorney] should expect not only dismissal of his appeal but also the possibility of double costs, penalty interest, or damages under the provisions of Mass. R. A. P. 25, as amended, 378 Mass. 925 (1979), [of G. L. c. 211 § 10,] of G. L. c. 211A, § 15, or of G. L. c. 231, §§ 6F or 6G.” Mancuso v. Mancuso, 10 Mass. App. Ct. 395, 402 (1980). Accord Pollack v. Kelly, 372 Mass. 469, 477 (1977) (imposing double costs); Matter of a Grand Jury Subpoena, 30 Mass. App. Ct. 462, 463 (1991), S.C., 411 Mass. 489 (1992). Because we have not reviewed procedure under G. L. c. 231, §118, recently, we do not impose sanctions in this case. Appeal dismissed. Initially, Ashford filed a complaint against the MBTA with the Massachusetts Commission Against Discrimination (MCAD). Pursuant to G. L. c. 151B, § 9 (1994 ed.), the MCAD dismissed the complaint at Ashford’s request. “[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 irreparable harm which granting the injunction would create for the opposing party. What matters as to each party is not the raw amount of irreparable harm the party might conceivably suffer, but rather the risk of such harm in light of the party’s chance of success on the merits. Only where the balance between these risks cuts in favor of the moving party may a preliminary injunction properly issue.” Packaging Indus. Group, Inc. v. Cheney, 380 Mass. 609, 617 (1980). Accord Planned Parenthood League of Mass., Inc. v. Operation Rescue, 406 Mass. 701, 710 (1990). At oral argument before this court, the focus was on the adequacy of Ashford’s remedy at law. Ashford’s reliance on G. L. c. 231, § 112 (1994 ed.), is misplaced. Section 112 sets forth the procedure for a report by the single justice. The single justice did not report this matter and thus § 112 is not applicable. Ashford did not seek relief pursuant to G. L. c. 211, § 3 (1994 ed.). General Laws c. 231, § 118, first par., provides, in pertinent part: “A party aggrieved by an interlocutory order of a trial court justice in the superior court . . . may file ... a petition in the appropriate appellate court seeking relief . . . .” Ashford’s assertion that Edwin R. Sage Co. v. Foley, 12 Mass. App. Ct. 20 (1981), stands for a contrary proposition is not correct. In Sage, unlike this case, the single justice authorized the litigant to pursue an interlocutory appeal. Id. at 21. General Laws c. 231, § 118, second par., provides, in pertinent part: “A party aggrieved by an interlocutory order of a trial court justice in the superior court . . . granting [or] refusing ... a preliminary injunction, . . . may appeal therefrom to the appeals court . . . .” In criminal cases, where the defendant has been convicted and sentenced, a motion to stay sentence may be heard by a single justice of this court after being denied by a single justice of the Appeals Court. Commonwealth v. Allen, 378 Mass. 489, 496-497 (1979).
CHANDLER v DOWELL SCHLUMBERGER, INC Docket No. 166009. Submitted April 12, 1995, at Grand Rapids. Decided October 24, 1995, at 9:05 a.m. Leave to appeal sought. Joseph W. Chandler brought an action in the Midland Circuit Court against Dowell Schlumberger, Inc., alleging retaliatory discharge from employment in violation of the Whistleblowers’ Protection Act, MCL 15.361 et seq.; MSA 17.428(1) et seq. The court, Paul J. Clulo, J., granted summary disposition for the defendant, ruling that the act affords no relief where discharge is based on the employer’s mistaken belief that the employee has reported a violation by the employer to a public authority. The plaintiff appealed. The Court of Appeals held: The Legislature, in enacting the Whistleblowers’ Protection Act, sought to protect the public from violations of laws, rules, and regulations and to protect those employees who exercise their civic duty in reporting such violations. The protection of employees who report violations by their employers serves to encourage reporting by those employees who might otherwise be fearful of the consequences of reporting. Consistent with the purposes behind the act, the Legislature did not provide protection under the act to employees discharged because of their employers’ mistaken belief that the employees reported violations to public authorities. Such employees are entitled only to those legal protections to which all other discharged employees in Michigan are entitled. Affirmed. D.E. Shelton, J., dissenting, stated that the protection of the Whistleblowers’ Protection Act extends to an employee whose discharge is based on' the employer’s mistaken belief that the employee has reported a violation and that denying such an employee the protections of the act serves to discourage the reporting of violations. The case should be reversed and remanded for trial. References Am Jur 2d, Wrongful Discharge §§ 55-72. Liability for retaliation against at-will employee for public complaints or efforts relating to health or safety. 75 ALR4th 13. Master and Servant — Whistleblowers’ Protection Act. The Whistleblowers’ Protection Act forbids an employer from discharging an employee on the basis that the employee has reported or is about to report the employer to a public authority for a violation or suspected violation of a law or regulation; the act affords no protection to an employee whose discharge is based on a mistaken belief by the employer that the employee has reported a violation (MCL 15.362; MSA 17.428[2]). R. Drummond Black; for the plaintiff. Riecker, Van Dam & Gannon, P.C. (by Lynn S. Looby), for the defendant. Before: Gribbs, P.J., and Markman and D. E. Shelton, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Markman, J. Plaintiff appeals from an opinion and order of the Midland Circuit Court granting summary disposition in favor of defendant. We affirm. Plaintiff was employed by defendant beginning in June 1989. In January 1992, a new regulation went into effect requiring that defendant obtain certification for vehicles transporting hazardous materials on public roads. Plaintiff complained to defendant’s agents regarding defendant’s inconsistent compliance with the regulation. However, plaintiff did not report the violation to any public authority. On April 6, 1992, defendant was cited by the Michigan Department of Transportation for violating the regulation as a result of an anonymous tip. Shortly thereafter, defendant terminated plaintiffs employment. On July 8, 1992, plaintiff filed a complaint alleging that defendant was liable under the Whistle-blowers’ Protection Act (wpa), MCL 15.361 et seq.; MSA 17.428(1) et seq. Defendant moved for summary disposition pursuant to MCR 2.116(C)(8) and (10), alleging that plaintiff had been dismissed because of economic necessity and that plaintiff could not recover under the wpa because he had not engaged in the protected activity of reporting or being about to report illegal conduct to a public authority. The trial court granted defendant’s motion pursuant to. MCR 2.116(C)(10), reasoning that because plaintiff had never reported a violation to a public authority, he had not engaged in protected activity and thus had failed to state a prima facie case under the wpa. Plaintiff argues that the wpa protects an employee who has been discharged because of an erroneous perception that the employee has reported a violation of law, regulations, or rules to a public body. We disagree. The starting point in every case involving construction of a statute is the language itself. House Speaker v State Administrative Bd, 441 Mich 547, 567; 495 NW2d 539 (1993). The wpa, at MCL 15.362; MSA 17.428(2), provides the following: An employer shall not discharge, threaten, or otherwise discriminate against an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because the employee, or a person acting on behalf of the employee, reports or is about to report, verbally or in writing, a violation or a suspected violation of a law or regulation or rule promulgated pursuant to law of this state, a political subdivision of this state, or the United States to a public body, unless the employee knows that the report is false, or because an employee is requested by a public body to participate in an investigation, hearing, or inquiry held by that public body, or a court action. This Court has stated that under the wpa a prima facie case of retaliatory discharge requires proof (1) that the plaintiff was engaged in protected activities as defined by the act, (2) that the 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). The issue in this case involves the first and third requirements. The plaintiff did not report, nor does he argue that he was about to report, his employer’s violations to a public body. Thus, he was not "engaged in protected activities as defined by the act.” Because he was not so engaged, there also exists a lack of a causal connection between the discharge and "the protected activity.” Plaintiff claims, however, that he is entitled to protection under the wpa as a "perceived whistle-blower.” In support of his claim, plaintiff points to Sanchez v Lagoudakis, 440 Mich 496; 486 NW2d 657 (1992), in which the Michigan Supreme Court held that the Michigan Handicappers’ Civil Rights Act (mhcra) prohibited employer discrimination based on erroneous perception of membership in a protected category. The mhcra specifically provided a cause of action to employees who were subject to discrimination "because of a handicap.” MCL 37.1202(1); MSA 3.550(202X1); Sanchez, supra at 502. The Court held that the mhcra covered those érroneously perceived of as having a handicap, reasoning: The focus of the act was the basis of the employer’s conduct — the employer’s belief or intent — and not the employee’s condition. If the employer acts on a belief that the employee has a handicap, and subsequently discharges or otherwise discriminates against the employee on the basis of that belief, it is inconsequential whether the employee actually has the handicap because, in either hypothesis, the employer has undertaken the kind of discriminatory action that the act prohibits. Although not applicable to the case before it, the Supreme Court noted that in 1990, the Legislature amended the definition of "handicap” to include "[b]eing regarded as having” a handicap. Id. at 506. Plaintiff urges this Court to follow the rule established in Sanchez to afford protection to perceived whistleblowers. Plaintiff further points to Polk v Yellow Freight System, Inc, 801 F2d 190 (CA 6, 1986), in support of his claim. In Polk, the court concluded that a visit to the Michigan Civil Rights Commission was a protected activity under the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq. As. the court noted, the act "prohibits discrimination or retaliation against a' person 'because the person has opposed a violation of this act, or because the person has made a charge, filed a complaint, testified, assisted, or participated in an investigation, proceeding, or hearing under this act.’ [MCL 37.2701(a); MSA 3.548(701)(a)].” Id. at 197. The court, citing Gifford v Atchinson, T & S F R Co, 685 F2d 1149, 1156, n 3 (CA 9, 1982), found no legal distinction between filing a charge and threatening to file a charge. Id. at 200. The court then reasoned: We see no reason to distinguish between a visit to a government agency to inquire about filing a charge and a threat to file a charge. In both instances, the focus is not on whether the employee intends to follow through with, filing the charge, but rather on whether the employer’s decision to discharge was motivated by an improper desire to retaliate against an employee for pursuing rights granted by the Act. [Polk, supra at 200.] The issue whether the wpa affords protection to a perceived whistleblower has not been examined in Michigan. However, the issue of an employer’s knowledge or belief under the wpa was addressed in Kaufman & Payton, PC v Nikkila, 200 Mich App 250; 503 NW2d 728 (1993). In Kaufman & Payton, the counterplaintiff was employed by the law firm of Kaufman & Payton, P.C. Id. at 252. After becoming concerned with the legality of billing procedures that she had executed, she consulted outside counsel who subsequently sent letters to the firm questioning its billing practices and addressing the counterplaintiff’s future duties. Id. at 252-253. The counterplaintiff subsequently resigned. Id. at 253. Thereafter, she sent a request for investigation to the Attorney Grievance Commission and followed up with a formal complaint. Id. The counterplaintiff later alleged in her countercomplaint against the employer that she had been constructively discharged in violation of the wpa. Id. at 253-254. This Court found that the counterplaintiff’s failure to produce evidence that the firm believed, before she resigned, that the counterplaintiff would report her complaints to responsible agencies was fatal to her cause of action under the wpa. Id. at 254-258. A majority of the panel explained: An employer’s subjective fear of retaliation will not substitute for some form of notice of threatened action. Instead, an employer is entitled to objective notice of a report or a threat to report by the whistleblower. Neither Kaufman’s nor the firm’s knowledge that Nikkila [the counterpl’aintiff] had retained counsel, together with other unspecified evidence, yields an inference that the firm believed before she resigned that she would report her complaints to responsible agencies. [Id. at 257-258. Emphasis in original.] One could conceivably argue, under Kaufman & Payton, that plaintiff’s dismissal, which may have been based on a "fear” or "perception” of whistle-blowing, is not covered under the wpa. However, the problem with the counterplaintiff’s case in Kaufman & Payton was the lack of a causal connection between the alleged constructive discharge and protected activity under the wpa due to the employer’s apparent lack of belief or knowledge of any protected activity. In other words, if the employer did not believe or know of the employee’s protected activity, it would be difficult to imagine how that could have been the basis for discharge. In contrast, in the instant case, assuming plaintiff was discharged because of defendant’s erroneous perception of whistleblowing by plaintiff, defendant had the belief or knowledge of whistle-blowing. In fact, defendant in this case admitted that whistleblowing had taken place, the erroneous perception only being that the individual who engaged in the activity was the plaintiff. We recognize, of course, that a causal connection is nevertheless still lacking between the discharge and actual protected activity by the plaintiff. However, defendant’s motivation for the discharge here would be the same as an employer who discharges an employee actually engaged in protected activity. The question thus becomes whether that motivation is enough to provide protection under the wpa to the terminated employee who was not engaged in protected activity. In construing the wpa, plaintiff, citing Sanchez and Polk, would have us focus, not on the action of the employee, but instead on the motive or intent of the employer. In Sanchez and Polk, the Michigan Supreme Court and the Sixth Circuit Court of Appeals, respectively, both expressed the necessity of focusing on the motive or intent of the employer in the context of legislative acts seeking to prevent discrimination. However, we find Polk to be clearly distinguishable from the instant case. In Polk, the Sixth Circuit Court of Appeals noted its focus on employer motive in the context of a case in which the employee had in fact taken some action in an effort to resist discrimination. The court concluded that the employee was pursuing rights protected by the Civil Rights Act and was discharged as a result. In the instant case, however, we do not address whether plaintiff’s actions constitute protected activity under the wpa. It is undisputed that plaintiff neither reported nor was about to report defendant’s violations to a public body. We instead address whether, despite plaintiffs inaction, he is nevertheless entitled to protection under the wpa. In Sanchez, the employee was discharged because of an erroneous perception that she was handicapped. Thus, assuming that plaintiff was discharged because of an erroneous perception that he was a whistleblower, Sanchez provides considerable guidance. In deciding whether the employee was entitled to protection under the mhcra, the Supreme Court examined the language and purpose of the act. The Court concluded that the act focused on the employer’s belief or intent— the process of discrimination — and that denying protection to those erroneously perceived as having a handicap would be inconsistent with the mhcra’s intent of preventing discrimination based on handicap. Sanchez, supra at 502, 502-503, n 16. In deciding whether plaintiff is entitled to protection under the wpa, we similarly examine the language and purpose of the act. The wpa provides that an employer shall not discharge an employee because the employee, or a person acting on behalf of the employee, reports or is about to report, verbally or in writing, a violation or a suspected violation of a law or regulation or rule promulgated pursuant to law of this state, a political subdivision of this state, or the United States to a public body .... [MCL 15.362; MSA 17.428(2). Emphasis added.] In contrast with this section of the wpa is § 202(1) (b) of the mhcra, MCL 37.1202(l)(b); MSA 3.550(202)(l)(b), applied in Sanchez that protects against discharge "because of a handicap that is unrelated to the individual’s ability to perform the duties of a particular job or position.” Sanchez, supra at 502. Unlike the mhcra, which protects against discharge or other discrimination on the basis of inherent status, the wpa protects against discharge or other discrimination on the basis of certain concrete actions taken by the employee. However, this difference alone, while not irrelevant, does not appear to require disparate application of the two acts. The importance and effect of this distinction becomes more apparent when viewed in light of the respective purposes of the two acts. The purpose of the mhcra is to prevent discrimination — a process of thinking and conduct by the employer — based on handicap. As the Supreme Court reasoned, it would be inconsistent with that purpose to deny protection to those who are the victims of this process even though the perception is erroneous that they are handicapped. The harm on which the Legislature focused is the same whether the object of the discrimination was handicapped or not. We therefore consider whether a similar inconsistency would result if protection were denied to those discriminated against because of the erroneous perception that they are whistleblowers: The [legislative] analysis [of the wpa] recognizes the problem the wpa was designed to alleviate as the inability to combat corruption or criminally irresponsible behavior in the conduct of government or large businesses. House Legislative Analysis, HB 5088, 5089 (February 5, 1989). The analysis goes on to say that "[t]he people best placed to observe and report violations are the employees of government and business, but employees are naturally reluctant to inform on an employer or a colleague.” [Dudewicz v Norris Schmid, Inc, 443 Mich 68, 75; 503 NW2d 645 (1993). Emphasis omitted.] The wpa "seeks to protect the integrity of the law by removing barriers to employee efforts to report violations of the law” and also "to protect the public by protecting employees who report violations of laws and regulations.” Tyrna, supra at 599-600, citing Hopkins v City of Midland, 158 Mich App 361, 374; 404 NW2d 744 (1987). Violations of laws, rules, and regulations by employers do not just harm their employees but, by definition, also harm the interest of the public at large. However, the public is obviously not as likely to discover these violations as are employees. Statutory protection of the employee who reports a violation serves to encourage reporting by an employee who might otherwise be fearful of the consequences. As a result, the public is better served. In contrast, we do not believe that protection of employees who either are unable or unwilling to report violations of laws, rules, or regulations significantly encourages reporting. In fact, it is arguable that such protection under the wpa could discourage actual reporting where employees are cognizant that they will be protected absent any invocation of their civic duty as long as the employer erroneously believes the employee has engaged in such activity. Plaintiff claims that a primary purpose of the wpa is to discourage employers from retaliation against employees who have reported or are about to report legal violations to a public body. He thus argues that denying him protection would be inconsistent with that goal. We acknowledge that penalizing and discouraging employers are inevitable effects, and presumably inherent in the purpose, of the wpa. Certainly if we look at this as the wpa’s exclusive — or even principal — purpose, we could conclude, as the Supreme Court did in Sanchez, that protection to a perceived whistleblower is provided under the act. However, in doing so, and focusing principally upon the employer’s motive or intent under the wpa, we render it "inconsequential,” Sanchez, supra, whether the employee actually reports or is about to report a legal violation to a public body. Accordingly, we lose sight of the fact that plaintiff has not served or attempted to serve any public interest by reporting the very harm against which the wpa ultimately seeks to protect. The wpa specifically seeks to protect the public from violation of laws, regulations, and rules. How then can we conclude that the employee’s actions, which are so indispensable in facilitating this goal, are "inconsequential”? Unlike an inherent status such as a handicap, over which an employee has no control, an employee has full control over his actions. The wpa seeks to encourage those actions that assist in the protection of the public by in turn protecting the employee. Indeed, this is the only rationale for the wpa. Unlike the mhcra, whose purpose is to prevent discrimination per se, the wpa is designed to prevent discrimination but only as a means to a particular public policy end — an end to which plaintiff has not contributed in any way. In the instant case, plaintiff has not comported himself any differently than any other employee who did not engage in whistleblowing, the only difference b
KIRK C. AUNE v. UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL, DR. STUART BONDURANT, WILLIAM D. MATTERN, and EDWIN CAPEL No. COA94-1350 (Filed 17 October 1995) 1. Public Officers and Employees § 58 (NCI4th)— whistle-blowing claim — nonreappointment unrelated to whistle-blowing — summary judgment for defendants proper The evidence was sufficient to support summary judgment for defendants on plaintiffs whistleblower claim where plaintiff was not reappointed as an associate dean at a state university; defendants presented undisputed evidence that plaintiffs performance was scrutinized in compliance with university policy; defendants’ evidence specifically revealed that the final committee review, which recommended that plaintiff not be reappointed, was conducted fairly and without bias; the evidence was that there were questions regarding the adequacy of plaintiffs performance, of which plaintiff had knowledge, even before his whistleblowing to defendants; defendants’ evidence revealed that plaintiff’s nonappointment was based on his inability to collaborate with others; and plaintiff failed to show that his reports of conflicts of interest and possible misappropriation of state resources were a substantial factor in the nonrenewal of his appointment N.C.G.S. § 126-85. Am Jur 2d, Public Officers and Employees §§ 236-239, 261, 262, 288. Pre-emption by workers’ compensation statute of employee’s remedy under state “whistleblower” statute. 20 ALR5th 677. Pre-emption of wrongful discharge cause of action by civil rights laws. 21 ALR5th 1. 2. State § 23 (NCI4th)— emotional distress and misrepresentation — claims barred by sovereign immunity Summary judgment for defendant state university administrators on plaintiff’s emotional distress and misrepresentation claims was appropriate based on defendants’ claims of sovereign immunity, since allegations in the complaint involved acts of defendants performed within the bounds of their official duties and in their capacities as representatives of the state. Am Jur 2d, Damages §§ 41, 251-262; Municipal, County, School and State Tort Liability § 70; States, Territories and Dependencies §§ 104-111. Appeal by plaintiff from order entered 26 September 1994 in Orange County Superior Court by Judge Anthony M. Brannon. Heard in the Court of Appeals 12 September 1995. McSurely & Dorosin, by Mark Dorosin and Alan McSurely, and Levine Stewart & Davis, by John T. Stewart, for plaintiff-appellant. Attorney General Michael F. Easley, by Special Deputy Attorney General Thomas J. Ziko, for defendant-appellees. GREENE, Judge. Kirk C. Aune (plaintiff) appeals from the trial court’s entry of summary judgment in favor of the University of North Carolina at Chapel Hill (University), Dr. Stuart Bondurant (Bondurant), William D. Mattern (Mattern), and Edwin Capel (Capel) (collectively defendants) on plaintiffs “Whistleblower,” intentional and/or negligent infliction of emotional distress and misrepresentation claims. Oh 7 July 1993, plaintiff filed this action against defendants, alleging that in 1991, while he was employed by the University School of Medicine as the Associate Dean for Information Systems and Director of the Office of Information Systems (OIS), he reported to Mattern (Associate Dean of Academic Affairs) and Bondurant (Dean of the School of Medicine) “the existence of an apparent conflict of interest among some employees of the School of Medicine.” In 1992 he reported the “potential conflicts of interest as well as the possible appropriation of state resources by some employees of the School of Medicine for their own private commercial gain” to Capel (University’s internal auditor). He further alleges that “the decision to terminate [his] employment. . . was made in retaliation for the aforesaid reports” and in violation of N.C. Gen. Stat. §§ 126-84, -85. Plaintiff also alleged that the defendants “acted willfully, wantonly and intentionally and/or were negligent in their handling of the performance review and [his] attempt to report suspected misbehavior and conflicts of interest” and that he suffered severe emotional distress as a consequence. The plaintiff finally alleged that the University misrepresented “the fairness with which decisions about his continued employment would be made,” that Capel and the University misrepresented that “an appropriate investigation would be conducted” into his 18 June 1992 report and that Bondurant misrepresented “that there would be no negative repercussions from making a report of suspected misappropriation of state resources.” Plaintiffs suit is captioned against Bondurant, Mattern and Capel in both their official and individual capacities. In support of the defendants’ motion for summary judgment they presented an affidavit by Bondurant in which he recalled only one time, “in early 1992, or possibly 1991,” that plaintiff asserted the possibility of a conflict of interest among employees of the School of Medicine. After Bondurant had Mattern conduct an investigation, which revealed no conflict, Bondurant told plaintiff, who was not satisfied with the outcome, that he could report his concerns to Capel. Bondurant heard nothing else of plaintiffs complaints and therefore “considered the matter to be resolved.” Furthermore, Bondurant did not know of plaintiffs reports to Capel until after the nonrenewal of plaintiffs appointment. In 1992, Bondurant appointed a committee to review plaintiffs performance. Bondurant further states, in his affidavit, that he did not ask Mattern to influence the 1992 review committee’s decision, although he did request that Mattern discuss candidates to serve as committee members. Dr. David Ontjes (Ontjes), who served as chair of the 1992 review committee, and another committee member interviewed Mattern, as a witness, before the committee formally convened to hear from witnesses and write its report. During his interview, Mattern expressed his opinion that plaintiff should not be reappointed. Although Ontjes questioned Bondurant regarding the necessity of a review after hearing Mattern’s opinion, Bondurant “assured [Ontjes] that a review was quite necessary, and that [he] wanted the committee to conduct an impartial and thorough examination of [plaintiff’s] leadership of OIS, on the basis of which [Bondurant] would then make a decision.” Bondurant stressed that Mattern’s opinion was just one person’s and that the committee should consider all sources before making a recommendation. Bondurant gave no indications of his personal views regarding plaintiff to the committee and asked for a thorough and objective review. The 1992 review committee issued a report on 22 April 1993 and “strongly advise[d] that [plaintiff] not be reappointed.” In support of its recommendation it determined that plaintiff’s style of interaction had decreased his effectiveness, citing specifically the perception that he was rigid and uncompromising and his failure to provide a functional long-term plan or to address the microcomputer evolution. Bondurant “decided to accept the [c]ommitte’s recommendation” and not reappoint the plaintiff. In Mattem’s affidavit in support of the motion, he stated that he only remembers a general statement by plaintiff regarding the conflict of interest charge in the fall of 1991. After plaintiffs mention of a potential problem, Mattem carefully questioned the faculty member involved and was satisfied by the faculty member’s explanation that there was no conflict of interest. Mattem reported his satisfaction to plaintiff. Plaintiff never mentioned that conflict issue again. Plaintiff also brought forth a potential conflict of interest held by a programmer, regarding a previous dual employment contract held by the programmer. When Mattern investigated, he determined that the programmer was no longer working on the project which would have given rise to the conflict of interest. Furthermore, Mattern was only limitedly involved in plaintiff’s 1992 review. Mattern worked to appoint the committee members, but members to whom plaintiff objected were removed from the committee and the final committee contained no member to which plaintiff did not agree. Mattem also submitted a list of names to the committee of people they might contact, “specifically omitt[ing] . . . people whose views [he] thought were uniformly negative.” The undisputed evidence also reveals that the committee had numerous sources from which to collect witnesses, including an open request to anyone interested in the hearing to testify either for or against plaintiff’s reappointment. Mattem’s only other involvement with the review was his testimony as a witness. Furthermore, Mattern did not know of plaintiff’s reports to Capel. Defendants also presented affidavits from members of the 1992 review committee. Each member gave specific facts establishing the unbiased nature of plaintiff’s 1992 review. All stated their opinion that the committee conducted a fair, unbiased review of plaintiff’s performance, and none had any preconceived notions regarding plaintiffs reappointment. Additionally, the administrative assistant who staffed the 1992 review committee submitted an affidavit stating that the review was ordinary and conducted as others at the University had been conducted. In response to defendants’ evidence, plaintiff presented an affidavit containing the specific facts relating to his reports to Bondurant, Mattern and Capel. Plaintiff had earlier stated in his complaint his own belief that his appointment was not renewed because of his reports. The plaintiff also presented an affidavit by John Gullo (Gullo), a former OIS employee, which included his statements that Dr. James Wrenn “told top level computer people in the Hospital that [plaintiff] was ‘going to be cut down to size’ and they didn’t have to worry about [plaintiff’s] OIS.” Gullo also saw a budget request by plaintiff, on which Bondurant’s “main administrator” had commented “I don’t think its going to help.” The issues are whether (I) the evidence supports summary judgment for the defendants on the “Whistleblower” claim; and (II) Bondurant, Mattern and Capel have been sued only in their official capacity, rendering them immune from plaintiff’s claims for emotional distress and misrepresentation. I North Carolina General Statute § 126-85, known as the “Whistleblower” Act (the Act) protects State employees who make reports of certain activities described in section 126-84 from retaliation by heads of “any State department, agency, or institution” or retaliation by any other State employee “exercising supervisory authority” over the employee. N.C.G.S. § 126-85 (1993). The Act is violated if the report is a substantial causative factor in any “discharge,” threat or discrimination “regarding the State employee’s compensation, terms, conditions, location, or privileges of employment.” Id.; Kennedy v. Guilford Tech. Community College, 115 N.C. App. 581, 584, 448 S.E.2d 280, 282 (1994); see Brooks v. Stroh Brewery Co., 95 N.C. App. 226, 230, 382 S.E.2d 874, 878 (applying substantial factor test to retaliatory discharge claim under Occupational Safety and Health Act), disc. rev. denied, 325 N.C. 704, 388 S.E.2d 449 (1989); see also Mt. Healthy City Bd. of Educ. v. Doyle, 429 U.S. 274, 287, 50 L. Ed. 2d 471, 484 (1977) (retaliation claim based on first and fourteenth amendments requires proof that protected conduct was a “substantial or motivating factor” in adverse action). Upon a showing of retaliation the employee is entitled to “damages, an injunction, or other remedies.” N.C.G.S. § 126-86 (1993); Minneman v. Martin, 114 N.C. App. 616, 618-19, 442 S.E.2d 564, 566 (1994). In the context of summary judgment in this type of action, once a defendant, moving for summary judgment, presents evidence that the adverse employment action is based' on a legitimate non-retaliatory motive, the burden shifts to the plaintiff to present evidence, raising a genuine issue of fact, that his actions under the Act were a substantial causative factor in the adverse employment action, see Taylor v. Taylor Prods., Inc., 105 N.C. App. 620, 625, 414 S.E.2d 568, 572-73 (1992) (discussing burdens of parties in summary judgment hearing), or provide an excuse for not doing so. N.C.G.S. § 1A-1, Rule 56(f) (1990). In determining whether there are any genuine issues of material fact, the trial court must view the evidence in the light most favorable to the plaintiff and resolve all conflicts in plaintiff’s favor, giving plaintiff all reasonable inferences. Broyhill v. Aycock & Spence, 102 N.C. App. 382, 389, 402 S.E.2d 167, 172, disc. rev. denied, 329 N.C. 266, 407 S.E.2d 831 (1991). A genuine issue of material fact exists if plaintiff’s evidence is substantial. Martin v. Ray Lackey Enters., 100 N.C. App. 349, 353, 396 S.E.2d 327, 330 (1990). In support of their motion for summary judgment, defendants argue that the nonrenewal of plaintiff’s appointment was not a result of his reports regarding any conflicts of interest or the possible misappropriation of State resources and instead was based on legitimate non-retaliatory reasons. We agree that the defendants’ evidence supports their argument. In support of their argument, defendants presented the undisputed evidence that plaintiff’s performance was scrutinized in compliance with University policy. Defendant’s evidence also specifically reveals that the final committee review, which recommended that plaintiff not be reappointed, was conducted fairly and without bias. Moreover, the evidence is that there were questions regarding the adequacy of plaintiff’s performance, of which plaintiff had knowledge, even before his reports to Bondurant and Mattern. Finally, the evidence reveals the nonappointment was based on the plaintiff’s inability to “collaborate with others.” In response to defendants’ motion, plaintiff argues that the 1992 review committee was biased by Bondurant and Mattern and that the reasons cited by defendants for the nonrenewal of plaintiff’s appointment are pretextual. Plaintiff’s complaint contains his own belief that his appointment was not renewed because of his reports. Other than the facts relating to the reports made by plaintiff to Bondurant, Mattern and Capel, which are set forth in his affidavit, plaintiff brings forward an affidavit containing a statement by Gullo that a former student stated that plaintiff would “be cut down to size” and that hospital computer employees “didn’t have to worry about [plaintiff’s] OIS,” and that Bondurant’s administrator commented that plaintiff’s budget request would not help. Even assuming that these statements would be admissible at trial, Taylor, 105 N.C. App. at 625, 414 S.E.2d at 572-73 (evidence used to meet a party’s burden at summary judgment must be admissible at trial), these statements do not raise a genuine issue of material fact with regard to whether the plaintiffs reports were a substantial factor in the nonrenewal of his contract, even viewing all the other evidence in plaintiffs favor and giving him all reasonable inferences. The evidence is simply too speculative to support a finding that the plaintiffs nonrenewal was in any way related to the report. Plaintiff also argues that even if the reasons that defendants give for not renewing his appointment are legitimate, the defendants also retaliated against plaintiff by “undercutting” his authority, “stonewalling” the promised investigation, “setting up oppositional centers of power,” and “creating a self-fulfilling review process.” Without determining whether these acts “otherwise discriminate” against plaintiff within the meaning of the statute, we reject this argument because these acts of retaliation were not alleged in plaintiffs complaint. Truesdale v. University of North Carolina, 91 N.C. App. 186, 190, 371 S.E.2d 503, 506 (1988) (plaintiffs case at summary judgment must be based on allegations in complaint), disc. rev. denied, 323 N.C. 706, 377 S.E.2d 229, cert. denied, 493 U.S. 808, 107 L. Ed. 2d 19 (1989). For an additional reason, summary judgment for Capel was correct. This record reveals that he had no supervisory authority over plaintiff and was not the head of any State department, agency or institution. See N.C.G.S. § 126-85(a); Taylor, 105 N.C. App. at 625, 414 S.E.2d at 572 (summary judgment appropriate where an essential element of plaintiffs case is lacking). II Defendants argue that summary judgment for them on the emotional distress and misrepresentation claims was also appropriate because they are protected from these claims by sovereign immunity. We agree. A governmental entity and its officers or employees when sued in their official capacity are immune from suits based on tort claims, unless there has been some waiver. Taylor v. Ashburn, 112 N.C. App. 604, 607, 436 S.E.2d 276, 278-79 (1993), disc. rev. denied, 336 N.C. 77, 445 S.E.2d 46 (1994). In determining whether a plaintiff has brought an action against a defendant in his official or individual capacity, it is important to consider both the “nature of the conduct giving rise to the action” and the “nature of the relief sought.” 1 Shepard’s Editorial Staff, Civil Actions Against State and Local Government, Its Divisions, Agencies and Officers § 1.16 (2d ed. 1992) [hereinafter Civil Actions]; see Taylor, 112 N.C. App. at 607-08, 436 S.E.2d at 279. The nature of the conduct determines in what capacity one can be sued, General Elec. Co. v. Turner, 275 N.C. 493, 498, 168 S.E.2d 385, 389 (1969), and the nature of the relief sought reveals how a defendant has been sued. Civil Actions §§ 1.17-.18. The designations made in the caption of the complaint are not determinative. Taylor, 112 N.C. App. at 607, 436 S.E.2d at 279. In this case the allegations in the complaint with respect to the tort claims involve acts of the defendants performed within the bounds of their official duties and in their capacities as representatives of the State. Therefore the individual defendants can only be sued in their official capacity and as such share the governmental immunity enjoyed by the University, an agency of the State. See Jones v. Pitt County Memorial Hosp., 104 N.C. App. 613, 617, 410 S.E.2d 513, 515 (1991) (all tort claims against UNC and its constituent institutions must be brought before the Industrial Commission). This immunity supports the summary judgment on these claims. See Dickens v. Puryear, 302 N.C. 437, 453, 276 S.E.2d 325, 335 (1981) (summary judgment appropriate where plaintiff cannot surmount defendant’s affirmative defense). Affirmed. Judges JOHNSON and SMITH concur.
KATHLEEN VICTORIA JOHNSON, Plaintiff v. FRIENDS OF WEYMOUTH, INC., Defendant No. 9420SC383 (Filed 19 September 1995) 1. Pleadings § 401 (NCI4th)— issue not raised in pleadings— trial by consent Where a substantial portion of plaintiff’s pleadings was devoted to the issue of whether she was fired for financial reasons, defendant averred in its answer that plaintiff was fired for financial reasons, both parties introduced a considerable amount of evidence regarding the financial condition of defendant and its relation to the termination of plaintiff’s employment, and plaintiff did not object to defendant’s introduction of evidence regarding the financial hardship issue, that issue was tried by the implied consent of the parties and should be treated as if it were raised in the pleadings. N.C.G.S. § 1A-1, Rule 15(b). Am Jur 2d, Pleading § 25. 2. Labor and Employment § 71 (NCI4th)— wrongful termination — inconsistent verdict — jury instructions improper The trial court in a wrongful termination case erred in instructing the jury in such a manner that an affirmative answer to both questions submitted to it would require a finding that an employee was wrongfully terminated and that the employer would have terminated the employee in any event, and these answers were inherently inconsistent and not an accurate representation of the standard established by Brooks v. Stroh Brewery Go., 95 N.C. 226, that, once the plaintiff has shown that the employee’s activities were protected and were a substantial factor in the employee’s decision, the burden then shifts to defendant to show that the same decision would have been made if the' employee had not engaged in the protected activity. Am Jur 2d, Master and Servant §§ 43 et seq. Appeal by plaintiff from orders entered on 9 December and 6 January 1994 by Judge James M. Long in Moore County Superior Court. Heard in the Court of Appeals 12 January 1995. Marvin Schiller; and Bass, Bryant & Moore, by William E. Moore, Jr., for plaintiff appellant. Cunningham, Dedmond, Petersen & Smith, by Bruce T. Cunningham, Jr., and Ann C. Petersen, for defendant appellee. COZORT, Judge. In this wrongful termination case, the trial court submitted two issues to the jury. First, the jury found that defendant wrongfully terminated plaintiff’s employment in retaliation for plaintiffs suggestion that defendant return money to an insurance company. However, in their answer to the second issue, the jury also found that defendant would have terminated plaintiff notwithstanding the insurance incident. As a result, the trial court entered judgment in favor of defendant. The trial court denied plaintiff’s motions to set aside the verdict, to amend the judgment, and for a new trial. We find that the two issues submitted to the jury allowed for inconsistent answers and remand the case for a new trial. The facts and procedural history follow. Defendant, a non-profit corporation which operates the Weymouth Center, employed plaintiff as its administrative secretary from 4 October 1982 until her discharge on 28 May 1992. In October 1991, defendant conducted an art auction fundraiser at which six cel-luloids (“cels”) from Disney cartoons were offered for sale. Defendant purchased an insurance policy to protect against any loss of these donated items. Two of the cels were not sold at the auction and were later discovered to be missing. Defendant submitted a claim to the insurance company for these lost cels and the insurance company paid defendant $950.00 under the policy. In January 1992, plaintiff discovered the missing cels in a closet and notified defendant’s president. Plaintiff testified that she encouraged officers of defendant to return the proceeds to the insurance company. Plaintiff presented evidence that two of defendant’s officers sold the two cels outside the state without reporting the sale to the insurance company. Defendant did not return the proceeds received from the insurance company until plaintiff’s counsel notified defendant that the money had not been returned. Defendant informed plaintiff by letter on 28 May 1992 that the position of administrative secretary was abolished and that she would receive one month’s severance pay. Plaintiff filed a complaint alleging that her termination constituted wrongful discharge because it was in retaliation for “her refusal to cooperate and participate in Defendants [sic] . . . unlawful . . . conversion of the insurance proceeds.” The complaint also made reference to a claim by defendant that plaintiff was terminated for financial reasons. In its answer, defendant admitted plaintiff had been fired for financial reasons, but defendant did not plead that reason for firing plaintiff as an affirmative defense. During the course of the trial, both plaintiff and defendant offered evidence regarding whether plaintiff was fired because of the insurance incident or due to defendant’s financial hardship. During the charge conference the trial judge proposed to submit to the jury a question regarding financial hardship, in addition to the issue regarding wrongful termination agreed upon by the parties. The court allowed defendant to amend its pleadings to conform to the evidence which supported the second issue of financial hardship, an affirmative defense not previously pled by defendant. Plaintiff objected to the submission of the second issue. Overruling plaintiff’s objection, the court submitted two questions to the jury: 1. Did the Defendant, Friends of Weymouth, Inc., wrongfully terminate the employment of the Plaintiff, Kathleen Victoria Johnson, because she suggested that insurance proceeds be returned to the insurance company? 2. If so, would the Defendant have terminated the Plaintiff’s employment even if she had not suggested that insurance proceeds be returned to the insurance company? The jury answered “yes” to both questions, and the court entered judgment in favor of defendant. Plaintiff contends that the second question should not have been submitted to the jury. According to plaintiff, submission of this issue amounted to “prejudicial surprise” because defendant did not plead financial hardship as an affirmative defense. While failure to plead an affirmative defense normally results in waiver, the parties may still try the issue by express or implied consent. Nationwide Mut. Insur. Co. v. Edwards, 67 N.C. App. 1, 6, 312 S.E.2d 656, 660 (1984). N.C.R. Civ. P. 15(b) provides: “When issues not raised by the pleadings are tried by the express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings.” N.C. Gen. Stat. § 1A-1, Rule 15(b) (1990). A substantial portion of plaintiffs pleadings are devoted to the issue of whether she was fired for financial reasons. Defendant averred in its answer that plaintiff was fired for financial reasons. Both parties introduced a considerable amount of evidence regarding the financial condition of defendant and its relation to the termination of plaintiffs employment. Plaintiff did not object to defendant’s introduction of evidence regarding the financial hardship issue. Therefore, the financial hardship issue was tried by the implied consent of the parties and should be treated as if it was raised in the pleadings. Even if the parties had not tried the financial hardship defense by implied consent, it was still properly before the jury. The trial court allowed defendant to amend its pleadings to include financial hardship as a defense. Rule 15(b) authorizes the trial court to allow a party to amend its pleadings, so long as it does not permit judgment by ambush. Smith v. Childs, 112 N.C. App. 672, 677, 437 S.E.2d 500, 504 (1993). This particular defense could not have been a surprise to plaintiff because she referred to it in her pleadings and produced evidence regarding defendant’s financial status during the presentation of her case. The proper standard for review of such action is whether the trial court abused its discretion. Id. at 678, 437 S.E.2d at 504. We find no abuse of discretion. Plaintiff next contends that the jury instructions were erroneous. The North Carolina Pattern Jury Instructions provide issues for the jury regarding wrongful termination and the employer’s defense to such a claim. The first question asks: Did the defendant wrongfully terminate the employment of the plaintiff? N.C.P.I., Civ. 640.20. If the jury answers “yes” to that question, they are presented with an issue regarding an affirmative defense for the employer which states: Would the defendant have terminated the plaintiff even if the plaintiff had not [engaged in conduct protected by law] [refused to engage in unlawful conduct] [refused to engage in conduct which violates public policy]? N.C.P.I., Civ. 640.22. The pattern instructions rely on Brooks v. Stroh Brewery Co., 95 N.C. App. 226, 382 S.E.2d 874, disc. review denied, 325 N.C. 704, 388 S.E.2d 449 (1989), as a basis for submitting both of these questions. Brooks stands for the proposition that once the plaintiff has shown that the employee’s activities were protected and were a substantial factor in the employer’s decision, the burden shifts to defendant to show that the same decision would have been made if the employee had not engaged in the protected activity. Id. at 230, 382 S.E.2d at 878. Due to the manner in which the pattern jury instructions are worded, an affirmative answer to both requires a finding that an employee was wrongfully terminated and that the employer would have terminated the employee in any event. These answers are inherently inconsistent and are not an accurate representation of the standard established by Brooks. In the present case, the following issues should have been submitted to the jury: 1. Was plaintiff’s suggestion that insurance proceeds be returned to the insurance company a substantial factor in defendant’s decision to terminate her employment? 2. If so, would defendant have terminated plaintiff’s employment even if she had not suggested that insurance proceeds be returned to the insurance company? With the issues worded in this fashion, the termination becomes wrongful only when both issues are answered favorably to the employee. This more accurately reflects the standard established by Brooks. Defendant brings forth several assignments of error as a cross-appeal. Defendant contends that the trial court erred in denying defendant’s motion for a directed verdict at the close of plaintiff’s evidence. The trial court should deny a motion for directed verdict when it finds there is any evidence more than a scintilla to support plaintiff’s prima facie case in all its constituent elements. Clark v. Moore, 65 N.C. App. 609, 610, 309 S.E.2d 579, 580-81 (1983). The evidence in the present case, taken in the light most favorable to plaintiff, established her prima facie case and warranted the issue going to the jury. Therefore, the trial court properly denied defendant’s motion for a directed verdict. We have reviewed defendant’s remaining assignments of error and find them to be unpersuasive. In sum, we hold the jury instructions submitted to the jury improperly allowed for inconsistent answers, and we remand this case for a new trial. New trial. Judges MARTIN, John C., and JOHN concur.
GTE Products Corporation vs. Jefferson Davis Stewart, Third; Dean T. Langford & others, defendants-in-counterclaim. Essex. May 3, 1995. August 1, 1995. Present: Abrams, Lynch, O’Connor, & Greaney, JJ. Employment, Constructive discharge. Contract, Employment. Public Policy. Attorney at Law, In-house counsel. Discussion of out-of-State cases considering whether an attorney employed as in-house counsel to a corporation is barred from maintaining any action for wrongful discharge. [26-29] This court concluded that an in-house attorney should be permitted to pursue a claim for wrongful discharge against the attorney’s corporate employer in the narrow circumstances where the claim is founded on allegations that the employer’s demands would have required violation of statutory or ethical rules, embodying important public policy, and where the claim can be proved without violation of client confidences and secrets. [29-32] Discussion of State and Federal cases addressing the elements for proof of constructive discharge. [34-35] In an action for wrongful discharge in which there was no claim of formal termination, summary judgment was correctly entered for the employer where the employee did not demonstrate that he could prove he was constructively discharged by being forced to work under conditions so intolerable that a reasonable person would have felt compelled to resign. [32-34, 35-36] Civil action commenced in the Superior Court Department on October 16, 1991. A motion for summary judgment was heard by John P. Forte, J., sitting under statutory authority. The Supreme Judicial Court granted an application for direct appellate review. Arthur G. Telegen for the plaintiff. Earle C. Cooley (Paul F. Beckwith with him) for Jefferson Davis Stewart, III. Earl E. Lawson and Rolfe D. Trevisan. Greaney, J. We granted the defendant’s application for direct appellate review in this case to decide whether summary judgment was properly granted to GTE Products Corporation (GTE), and individual officers and officials of the company on counterclaims brought by Jefferson Davis Stewart, III, a former in-house counsel for the lighting companies of GTE. Stewart’s counterclaims were raised in his answer to an action brought by GTE seeking the return of documents, papers, and other materials taken or retained by Stewart when he left GTE’s employment. (Some of the background of the case is reported in the appeal concerning GTE’s seeking injunctive relief and damages, 414 Mass. 721 [1993].) The counterclaims were based on the assertion by Stewart that he had been wrongfully discharged in retaliation for his continual attempts to convince GTE management to warn the public about safety risks associated with the use of certain GTE products, and his insistence that GTE comply with Federal law governing the disposal of hazardous waste. We conclude that summary judgment properly was ordered in favor of GTE and the remaining defendants in counterclaim, and we direct the entry of an appropriate judgment. The facts, stated in the light most favorable to Stewart based on the materials in the summary judgment record, see Alioto v. Marnell, 402 Mass. 36, 37 (1988), are as follows. Stewart began working for GTE in March, 1980, as an attorney in GTE’s electrical equipment group. In 1986, he was named general counsel to GTE’s lighting businesses, which included U.S. Lighting and Sylvania Lighting. In his capacity as general counsel, Stewart wrote a series of communications to corporate officers and officials concerning safety and liability issues related to three products manufactured by GTE’s lighting businesses. In these communications, he advocated that the company take aggressive and (presumably) costly measures to protect consumer safety and guard against possible corporate liability. In addition, when new Federal regulations on the disposal of hazardous waste were adopted, he advised GTE that a subsidiary of the company which provided lighting maintenance services would have to take the costly step of treating fluorescent and incandescent light bulbs as hazardous waste for purposes of disposal. Stewart asserts that his advice was disregarded on some occasions and generally was not well received. Stewart’s immediate supervisor was Rolfe Trevisan, general counsel for GTE. Trevisan had consistently given Stewart high annual performance ratings, raised his salary each year, and recommended that he receive substantial bonuses. A few months before Stewart left the company, Trevisan told Stewart that his performance was “above expectations” and gave him a good rating, a raise and a bonus of over $30,000. At some point during 1991, however, Trevisan lowered Stewart’s confidential promotability rating on the law department’s executive continuity charts from “promotable immediately” to the lowest promotability rating of “not promotable for three to five years.” According to Stewart, it became clear to him that he was being “squeezed out” of the company after a meeting he had with Trevisan on August 7, 1991. Trevisan told him that Earl Lawson, a corporate officer and manager, had become dissatisfied with Stewart’s domineering and “confrontational” style and that Stewart was going to have to learn to get along with Lawson or his future with GTE would be at risk; that Stewart should stop being the “social conscience” of the company; and that Trevisan intended to develop a set of performance objectives to “rehabilitate” Stewart as a productive member of the law department. Based on his experience advising the company on how to terminate employees, Stewart believed that Trevisan’s actions likely were intended as a precursor to discharge. Concluding that he would have to abandon unpopular but (in his opinion) legally sound positions were he to remain, Stewart resigned from his employment with GTE on August ,8, 1991. After Stewart left, Trevisan tried unsuccessfully to persuade him to return. 1. As a threshold question, we must decide whether Stewart’s status as an attorney and in-house counsel for GTE should bar him from maintaining any action for wrongful discharge. As a general rule, an employee at will (Stewart was employed at will) may be terminated by an employer, without notice, “for almost any reason or for no reason at all.” Jackson v. Action for Boston Community Dev., Inc., 403 Mass. 8, 9 (1988). In company with a majority of other jurisdictions, however, this court has recognized that an at-will employee may sue a former employer for wrongful discharge when that discharge can be shown to be in violation of a clearly defined public policy. “Redress is available for employees who are terminated for asserting a legally guaranteed right (e.g.,- filing workers’ compensation claim), for doing what the law requires (e.g., serving on a jury), or for refusing to do that which the law forbids (e.g., committing perjury).” Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., 404 Mass. 145, 149-150 (1989). In limited circumstances, we also have permitted redress “for employees terminated for performing important public deeds, even though the law does not absolutely require the performance of such a deed.” Flesner v. Technical Communications Corp., 410 Mass. 805, 810-811 (1991) (employee terminated for cooperating with criminal investigation of employer permitted to sue for retaliatory discharge). It has been suggested that a “whistleblower” might be entitled to protection on this basis. See id. at 811 n.3. Courts in jurisdictions which generally recognize an employee’s action for wrongful or retaliatory discharge have, however, differed on the question whether an attorney, employed as in-house counsel, should be permitted the same right to sue for wrongful discharge as that enjoyed by other corporate employees. In Balla v. Gambro, Inc., 145 Ill. 2d 492, 501 (1991), the Supreme Court of Illinois concluded “that, generally, in-house counsel do not have a claim ... of retaliatory discharge.” The court based its decision on the destructive impact recognition of the claim would have on the attorney-client relationship that exists between an employer and in-house counsel, id., and on its conclusion that the policy of preserving public health and safety, the basis for recognizing an employee’s wrongful discharge claim, is protected adequately without recognition of the claim by the attorney’s obligations under the Illinois Rules of Professional Conduct to attempt to prevent his employer from committing an illegal or harmful act and to withdraw from employment if he is requested to engage in conduct that would violate those obligations. Id. at 501-502, 504. It has also been noted that ethical canons and disciplinary rules give to a client the unfettered right to discharge an attorney in whom the client has lost confidence, and it has been reasoned that this precept should apply with full force to an attorney employed as in-house counsel. See Willy v. Coastal Corp, 647 F. Supp. 116, 118 (S.D. Tex. 1986) (applying Texas law), rev’d on other grounds, 855 F.2d 1160 (5th Cir. 1988), affd, 503 U.S. 131 (1992). See also Herbster v. North Am. Co. for Life & Health Ins., 150 Ill. App. 3d 21, 28-30 (1986), cert, denied, 484 U.S. 850 (1987). The judge granted GTE’s motian for summary judgment largely on the basis of the reasoning in these decisions. In contrast, in the case of General Dynamics Corp. v. Rose, 7 Cal. 4th 1164 (1994), decided after the judge in this case ruled on GTE’s motion for summary judgment, the Supreme Court of California concluded that there were sound reasons for recognizing the right of in-house counsel to sue for wrongful discharge in certain limited situations. The court noted that a claim of wrongful discharge protects more than the private interests in job security and professional reputation of the claimant. Protection of the policy expressed in the statute or rule claimed to have been violated by the employer is equally at stake, and the claimant’s status as an attorney does not diminish the public interest in the furtherance of that policy. Id. at 1181. In the view of the Supreme Court of California, certain mandatory obligations and prohibitions in the ethical rules of California governing an attorney’s professional conduct embody “by their nature and goals . . . important values affecting the public interest at large.” Id. at 1181-1182. The court observed that “[ajmong other strictures on their conduct, [attorneys] may not be a party to the commission of a crime, destroy evidence or suborn perjury.” Id. at 1186. Thus, “[t]he case for shielding the in-house attorney . . . from retaliation by the employer for either insisting on adhering to mandatory ethical norms of the profession or for refusing to violate them is . . . clear,” id. at 1182, and in-house counsel should be permitted to pursue a claim for wrongful discharge if the claim is “founded on allegations that an in-house attorney was terminated for refusing to violate a mandatory ethical duty embodied in [California’s code of professional conduct].” Id. at 1188. In addition, the court reasoned, in-house counsel should be permitted to pursue a claim in the “limited circumstances in which in-house counsel’s nonattorney colleagues would be permitted to pursue a [wrongful] discharge claim and governing professional rules or statutes expressly remove the requirement of attorney confidentiality” (emphasis in original). Id. The court pointed out, however, that instances in which disclosure of client confidences is permissible are rare, and emphasized that it would not condone any dilution of the obligation of secrecy in the context of the attorney-client relationship between a corporate employer and in-house counsel. We find the latter approach more persuasive. We would be reluctant to conclude that an employee, solely by reason of his or her status as an attorney, must be denied all protection from wrongful discharge arising from the performance of an action compelled by a clearly defined public policy of the Commonwealth. As was pointed out in a treatise critical of the decision in the Balia case, “[i]t is clear that there would have been a right of action had the employee not been a lawyer. It thus seems bizarre that a lawyer employee, who has affirmative duties concerning the administration of justice, should be denied redress for discharge resulting from trying to carry out those very duties” (footnote omitted). 1 G.C. Hazard & W.W. Hodes, Law of Lawyering § 1.16:206, at 477 (Supp. 1994). We agree with the Supreme Court of California that public interest is better served if in-house counsel’s resolve to comply with ethical and statutorily mandated duties is strengthened by providing judicial recourse when an employer’s demands are in direct and unequivocal conflict with those duties. See General Dynamics Corp. v. Rose, supra at 1188. We stress, however, that a claim for wrongful discharge brought by in-house counsel will be recognized only in narrow and carefully delineated circumstances. To the extent that in-house counsel’s claim depends on an assertion that compliance with the demands of the employer would have required the attorney to violate duties imposed by a statute or the disciplinary rules governing the practice of law in the Commonwealth, that claim will only be recognized if it depends on (1) explicit and unequivocal statutory or ethical norms (2) which embody policies of importance to the public at large in the circumstances of the particular case, and (3) the claim can be proved without any violation of the attorney’s obligation to respect client confidences and secrets. See S.J.C. Rule 3:07, Canon 4, DR 4-101 (A) and (B), as appearing in 382 Mass. 778 (1981). “Except in those rare instances when disclosure is explicitly permitted ... [by the disciplinary rules governing the practice of law in the Commonwealth], it is never the business of the lawyer to disclose publicly the secrets of the client.” General Dynamics Corp. v. Rose, supra at 1190. The exceptions to an attorney’s obligation to guard client confidences under S.J.C. Rule 3:07, Canon 4, DR 4-101 (C), as appearing in 382 Mass. 778 (1981), are extremely limited. While confidentiality concerns may to some degree be ameliorated by a trial court’s use of protective orders and other protective devices, the circumstances in which in-house counsel may pursue a claim for wrongful discharge will, of necessity, be limited by the broad obligation to guard client confidences. See G.M. Tuoni, Massachusetts Attorney Conduct Manual § 4-12 (1992) (discussing breadth of definition of client confidences). Similarly, if the claim for wrongful discharge is one that might be brought by a nonattorney colleague, based on the public policy exception as delineated in the Smith-Pfeffer and Flesner cases, it must be established that the claim can be proved without any violation of the attorney’s obligation to respect client confidences and secrets. 2. Having concluded that we shall, in limited circumstances, recognize the right of in-house counsel to bring suit for wrongful discharge, we turn to whether summary judgment was, nonetheless, properly granted. GTE, as the moving party, having met its initial burden of demonstrating by indicia of admissible evidence, see Mass. R. Civ. P. 56 (b) and (c), 365 Mass. 824 (1974), that Stewart cannot prevail, we inquire whether Stewart has established that there exists a genuine dispute as to essential factual elements of his claim. See Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711, 716 (1991). Stewart maintains that officials at GTE plotted his dismissal in retaliation for the tenor of the legal advice he offered with respect to product safety in three specific instances, and for advising the company that it must comply with Federal regulations despite the cost entailed by compliance. For the most part, Stewart’s claims appear to rest on his advice relating to the avoidance of possible legal liability, rather than with compelling issues of product design directly affecting public health and safety. His insistenpe that GTE conduct its business “in compliance with the highest ethical business standards,” by doing more than was absolutely required by law, met some resistance from others legitimately concerned about profitability. We would be reluctant to conclude that disagreements over the wording of a product warning label, or the hypothetical risk posed by a product, which are matters committed to the business judgment of a company and do not rise to the requisite level of public concern, could be the basis for a wrongful discharge claim. See King v. Driscoll, 418 Mass. 576, 583 (1994) (“internal administration, policy, functioning, and other matters of an organization cannot be the basis for public policy exception”); Wright v. Shriners Hosp. for Crippled Children, 412 Mass. 469, 474 (1992); Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., supra at 151; Mello v. Stop & Shop Cos., 402 Mass. 555, 560-561 (1988); Mistishen v. Falcone Piano Co., 36 Mass. App. Ct. 243, 245-246 (1994). However, we need not decide whether Stewart’s allegations are sufficient in this regard because we conclude, as matter of law, that Stewart has failed to present sufficient proof of constructive discharge. Stewart has not claimed that he was formally terminated from his position at GTE. Thus, to sustain his claim for wrongful discharge, it must appear that he will be able to prove that he was constructively discharged from his position as general counsel. A “[cjonstructive discharge occurs when the employer’s conduct effectively forces an employee to resign. Although the employee may say, T quit,’ the employment relationship is actually severed involuntarily by the employer’s acts, against the employee’s will. As a result, a constructive discharge is legally regarded as a firing rather than a resignation.” Turner v. Anheuser-Busch, Inc., 7 Cal. 4th 1238, 1244-1245 (1994). We have not had occasion to address what an employee must prove to establish a constructive discharge. The elements for proof of constructive discharge have been discussed in a number of cases decided by Federal and State appellate courts, however, and there is general agreement on the elements pertinent to a decision in this case. See, e.g., id. at 1247. See also Slack v. Kanawha County Hous. & Redevelopment Auth., 188 W. Va. 144, 153 (1992) (collecting cases). In a frequently cited decision, the United States Court of Appeals for the First Circuit has stated that in order for a constructive discharge to be found, “the trier of fact must be satisfied that the new working conditions would have been so difficult or unpleasant that a reasonable person in the employee’s shoes would have felt compelled to resign.” Alicea Rosado v. Garcia Santiago, 562 F.2d 114, 119 (1st Cir. 1977). The test is met if, based on an objective assessment of the conditions under which the employee has asserted he was expected to work, it could be found they were so difficult as to be intolerable. See Turner v. Anheuser-Busch, Inc., supra at 1248. See also Vega v. Kodak Caribbean, Ltd., 3 F.3d 476, 481 (1st Cir. 1993); Aviles-Martinez v. Monroig, 963 F.2d 2, 6 (1st Cir. 1992); Pena v. Brattleboro Retreat, 702 F.2d 322, 325 (2d Cir. 1983). A single, isolated act of an employer (or an agent of the employer) usually will not be enough to support a constructive discharge claim. Thus, evidence of a single unfavorable performance review or even of a demotion generally will not be deemed sufficient to support a claim. See Turner v. Anheuser-Busch, Inc., supra at 1247. “In order to amount to a constructive discharge, adverse working conditions must be unusually ‘aggravated’ or amount to a ‘continuous pattern’ before the situation will be deemed intolerable.” Id. For example, in Aviles-Martinez v. Monroig, supra at 6, the court held that an employee had present
YORK v 50TH DISTRICT COURT Docket No. 161573. Submitted May 16, 1995, at Lansing. Decided July 25, 1995, at 9:10 a.m. Deanna York brought an action in the Oakland Circuit Court against the 50th District Court, the State of Michigan, and James K. Conway, claiming wrongful discharge and sex discrimination. The plaintiff alleged that when she transferred from her position as a clerk-typist for the 50th District Court to a position as a court reporter, Judge Richard E. Cunningham, in urging her to make the transfer, made promises of job security in the event that she ever ceased to be his court reporter; however, when Judge Cunningham retired in June 1988, Conway, the court administrator, first transferred her to another job and then discharged her in January 1989. The plaintiff further alleged that she had not been considered for the job of court warrant officer in July 1988 because she was a female, despite being qualified for that position, with more seniority and experience than the male employee who filled the position. The court, Denise Langford-Morris, J., granted summary disposition for the defendants. The plaintiff appealed. The Court of Appeals held: 1. There is no dispute that the plaintiff, as a court reporter, was an at-will employee. The plaintiff failed to allege any basis for a finding that she had a reasonable expectation of remaining permanently employed as a court reporter unless discharged for good cause shown. Indeed, implicit in the plaintiff’s allegation that Judge Cunningham had promised her other employment if she were no longer his court reporter is the suggestion that she had no reasonable expectation to believe that the position as a court reporter was other than at-will employment. 2. MCR 8.110(E)(3)(d) vests in the chief judge of a district court the power to hire and fire all court personnel other than another judge’s law clerk or secretary. Accordingly, any promise of Judge Cunningham of other permanent employment with the court was unenforceable to the extent that such employment would take place when he was no longer chief judge. Because the plaintiff’s claim of permanent employment arose after Judge Cunningham retired, the trial court properly granted summary disposition for the defendants on the basis of the failure to state a claim for which relief can be granted with respect to the claim of wrongful discharge. 3. Because the plaintiff failed to apply for the position of court warrant officer and failed to allege any facts in support of her allegation that she was qualified for the position, the court properly granted summary disposition with respect to the claim of sex discrimination on the basis that the plaintiff failed to raise a genuine issue of fact concerning whether she was denied employment on the basis of gender. Affirmed. Lindsay & Allen (by Stephen J. Allen), for the plaintiff. Frank J. Kelley, Attorney General, Thomas L. Casey, Solicitor General, and Gary P. Gordan and Pamela J. Stevenson, Assistant Attorneys General, for the defendants. Before: Fitzgerald, P.J., and Markman and M. F. Sapala, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Per Curiam. Plaintiff appeals as of right the order granting defendants’ motion for summary disposition pursuant to MCR 2.116(C)(8) and (10) in this case involving claims of wrongful discharge and sex discrimination under the Civil Rights Act, MCL 37.2202(l)(a); MSA 3.548(202)(l)(a). We affirm. Plaintiff was hired by the City of Pontiac as a clerk-typist in November 1968. She transferred to the position of clerk-typist for the 50th District Court in June 1972. Plaintiff transferred to the position of court reporter for Judge Richard E. Cunningham in February 1973. Plaintiff alleged that she transferred to the position of court reporter at the urging of Judge Cunningham, who allegedly made promises of job security in the event plaintiff ever ceased to be his court reporter. Judge Cunningham retired in June 1988. James K. Conway, the 50th District Court Administrator, transferred plaintiff from the position of court reporter to a different position. Plaintiff alleged that a new position, that of court warrant officer, was created in July 1988 and that, despite her qualifications for the position, she was not considered for the position because she is a female. Plaintiff alleged that the position was filled by a male employee with less seniority and less experience. In December 1988, plaintiff was notified that her employment would be terminated effective January 1, 1989. Plaintiff filed a two-count complaint on July 9, 1991, alleging wrongful discharge and sex discrimination. Defendants filed a motion for summary disposition, which the trial court granted in an order dated January 12,1993. Plaintiff first argues that the trial court erred in granting summary disposition of her wrongful discharge claim pursuant to MCR 2.116(C)(8). A motion for summary disposition pursuant to MCR 2.116(C)(8) tests the legal sufficiency of a claim by the pleadings alone. All factual allegations in support of the claim are accepted as true, as well as any reasonable inferences or conclusions that can be drawn from the facts. Marcelletti v Bathani, 198 Mich App 655, 658; 500 NW2d 124 (1993). However, a mere statement of a pleader’s conclusions, unsupported by allegations of fact, will not suffice to create a cause of action. ETT Ambulance Service Corp v Rockford Ambulance, Inc, 204 Mich App 392, 395; 516 NW2d 498 (1994). A motion for summary disposition pursuant to MCR 2.116(C)(8) should be granted only when the claim is so clearly unenforceable as a matter of law that no factual development could possibly justify a right of recovery. Wade v Dep’t of Corrections, 439 Mich 158, 163; 483 NW2d 26 (1992). On appeal, summary disposition pursuant to MCR 2.116(C)(8) is reviewed de novo as a question of law. Mieras v DeBona, 204 Mich App 703, 706; 516 NW2d 154 (1994). Plaintiff contends that defendants failed to afford her procedural due process in terminating her property interest in her employment. However, there is no dispute that, as a court reporter, plaintiff was an at-will employee. Plaintiff has not made any allegations in support of a finding of just-cause employment in her position as a court reporter. To the contrary, plaintiff’s allegation that Judge Cunningham told her that she could have a different position if she ceased to be employed as his court reporter suggests that there was no express agreement that the position of court reporter would be a permanent just-cause position. Further, the promises that Judge Cunningham allegedly made to plaintiff are not enforceable because they exceeded his statutory authority. Thorin v Bloomfield Hills Bd of Ed, 203 Mich App 692, 700-701; 513 NW2d 230 (1994). See also MCL 600.8602; MSA 27A.8602 (each judge of the district court shall appoint his or her own recorder or reporter) and MCR 8.110(E)(3)(d) (a chief judge has administrative control over all court personnel with authority and responsibility to supervise, hire, discipline, or discharge such personnel, with the exception of a judge’s secretary and law clerk). At the time plaintiff alleges she should have been given a protected position, Judge Cunningham was no longer chief judge. The authority to hire therefore belonged to Judge Cunningham’s successor. Accordingly, the trial court properly granted summary disposition of the wrongful discharge claim pursuant to MCR 2.116(C)(8). Plaintiff also argues that the trial court erred in granting summary disposition of her sex discrimination claim pursuant to MCR 2.116(0(10). A motion for summary disposition pursuant to MCR 2.116(0(10) may be granted where, except with regard to the amount of damages, there is no genuine issue of 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 in favor of the nonmoving party and grant the benefit of any reasonable doubt to the opposing party. Radtke v Everett, 442 Mich 368, 374; 501 NW2d 155 (1993). The opposing party may not rest upon mere allegations or denials in the pleadings but, by affidavit or other documentary evidence, must set forth specific facts showing that there is a genuine issue for trial. MCR 2.116(G)(4). 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). To avoid summary disposition of a claim of sex discrimination under the Civil Rights Act, a plaintiff must demonstrate the existence of a genuine issue of material fact regarding whether a prima facie case of discrimination exists. Coleman-Nichols v Tixon Corp, 203 Mich App 645, 651; 513 NW2d 441 (1994). A prima facie case of sex discrimination is established where it is proven that a plaintiff is a member of a protected class, was qualified for an available position, and applied for the position, but was rejected under circumstances giving rise to an inference of unlawful discrimination. Ginther v Ovid-Elsie Area Schools, 201 Mich App 30, 35; 506 NW2d 523 (1993). Where, in response to a prima facie case of discrimination, a defendant puts forth a legitimate nondiscriminatory reason for its actions, a plaintiff has the burden of showing that the proffered reason was merely a pretext. Coleman-Nichols, supra at 651. In this case, there is no dispute that plaintiff was a member of a protected class. However, plaintiff failed to apply for the position of court warrant officer and failed to allege any facts to support her allegation that she was qualified for the position. Hence, the trial court properly granted summary disposition pursuant to MCR 2.116(C)(10), because plaintiff failed to demonstrate that there was a genuine issue of material fact regarding whether she was discriminated against on the basis of her gender. Affirmed. This position was covered by a collective bargaining agreement. This position was not covered by a collective bargaining agreement.
JOHN V. TELLADO, Plaintiff v. TI-CARO CORPORATION, a North Carolina Corporation and DIXIE YARNS, INC., a Tennessee Corporation, Defendants No. 9325SC1248 (Filed 18 July 1995) Workers’ Compensation § 60 (NCI4th); Labor and Employment § 75 (NCI4th)— retaliatory discharge — Workers’ Compensation Act inapplicable — Release and Severance agreement not barred by Act N.C.G.S. § 97-6, which provides that no contract or agreement shall relieve an employer of any obligation created by the Workers’ Compensation Act, does not apply to retaliatory discharge claims, since retaliatory discharge is not an “obligation” within the contemplation of this rule, and obligation refers only to benefits paid under the Act; therefore, N.C.G.S. § 97-6 did not bar the Release and Severance Agreement entered into by the parties which gave plaintiff three months’ severance pay in exchange for his agreement to make no claim of any kind upon defendant employer. Am Jur 2d, Workers’ Compensation §§ 474 et seq. Appeal by plaintiff from judgment entered by Judge J. Marlene Hyatt on 5 October 1993 in Catawba County Superior Court. Heard in the Court of Appeals 3 October 1994. Catawba Valley Legal Services, Inc., by Phyllis Palmieri, for plaintiff appellant. Constangy, Brooks & Smith, by W. R. Loftis, Jr., and Robin E. Shea, for defendant appellees. COZORT, Judge. Plaintiff appeals from order granting summary judgment for defendants on plaintiffs claim for retaliatory discharge. We affirm. Plaintiff was employed by defendants in their Catawba County plant as a supervisor in the card and spinning room. On 12 January 1992, plaintiff was injured on the job while helping a co-worker unchoke a clogged waste line. The door to the line slammed on plaintiffs hand, injuring a finger on his right hand. He immediately reported the accident to his supervisors. On 22 January 1992, plaintiff sought treatment from Dr. Donald Campbell of the Catawba Bone and Joint Clinic. Jane Shoemaker, an employee of defendants, told Dr. Campbell’s office that plaintiff would not be covered by workers’ compensation. On the same day, plaintiff’s supervisor, Donald Arrowood, noted in plaintiff’s personnel file that “John went to the doctor on his own [sic] was not notified until after the fact.” On 24 January 1992, Tom Arrington, plant manager, and Arrowood met with plaintiff. Plaintiff was placed on a sixty-day probation. Arrowood made another entry in plaintiff’s file stating that the meeting was “about following set procedure for accident follow-up . . . John is given 60-day turn around period on behavior.” The plaintiff was discharged on 31 March 1992. On 4 April 1992, plaintiff signed a document prepared by his employer entitled “Severance and Release Agreement” in exchange for three months’ severance pay. The release provides in pertinent part that plaintiff: 1) Hereby unconditionally release Dixie . . . from any and all claims arising out of my employment and termination from employment including, but not limited to, any claims for wrongful discharge.... 2) Agree not to institute any charge, claim, demand, or action based upon any federal, state, or local statutory law, regulation, or any common law theory including, but not limited to, any claims for wrongful discharge . . . against Dixie . . . concerning any aspect of my employment with Dixie or termination thereof. IV. I represent that I have read and understand the foregoing .... I understand that my acceptance of the consideration stated in Section I above and my execution of this Severance and Release Agreement are intended to bar any and all disputes arising out of my employment with Dixie or termination thereof. ... I agree that if I challenge, fail, or refuse to abide by the terms hereof, then Dixie shall be entitled to stop making any future payments and shall be entitled to the return of all monies and benefits paid on behalf of Dixie in consideration for this Severance and Release Agreement and shall be entitled to attorneys’ fees and other claims that it may have against me for the breach of the terms thereof. Plaintiff continued to be treated by Dr. Campbell. On 24 January 1992, defendants notified Dr. Campbell that the workers’ compensation claim would be filed and paid plaintiff’s medical expenses. On 4 August 1992, Dr. Campbell released plaintiff with 20% permanent partial disability in his middle finger. Plaintiff filed a verified complaint on 30 March 1993, alleging retaliatory discharge by defendants. Defendants filed an answer and counterclaim alleging breach of contract. A copy of the Severance and Release Agreement was attached as Exhibit A. In his reply to defendants’ counterclaim, plaintiff denied that the Severance and Release Agreement is a bar to his claims pursuant to N.C. Gen. Stat. § 97-6.1 or that he breached the agreement. On 7 June 1993, defendants filed a motion for judgment on the pleadings. On 9 August 1993, Judge J. Marlene Hyatt heard defendants’ motion. Judge Hyatt considered Exhibit A, the Severance and Release Agreement, and treated the motion as a motion for summary judgment. On 16 August 1993 the trial court ruled that there was no genuine issue of material fact and granted summary judgment for defendants on plaintiff’s claim and defendants’ counterclaim. On 5 October 1993, the trial court entered an order awarding defendants $2,500 on their counterclaim along with reasonable attorneys’ fees and costs. Plaintiff appealed. Plaintiff contends that the trial court erred in concluding that there was no genuine issue of material fact and that defendants were entitled to judgment as a matter of law. Specifically, plaintiff asserts (1) that the trial court erred in granting summary judgment to defendants based on an agreement which is barred by statute, and (2) the pleadings show that there are material issues of fact which preclude summary judgment. We disagree. Summary judgment is properly granted where the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. N.C. Gen. Stat. § 1A-1, Rule 56(c) (1990). The party moving for summary judgment has the burden of showing that there is no triable issue of material fact. Pembee Mfg. Corp. v. Cape Fear Constr. Co., 313 N.C. 488, 491, 329 S.E.2d 350, 353 (1985). “ ‘The movant may meet this burden by proving that an essential element of the adverse party’s claim is nonexistent, or by showing through discovery that the opposing party cannot produce evidence sufficient to support an essential element of his claim ....’” Roumillat v. Simplistic Enterprises, Inc., 331 N.C. 57, 63, 414 S.E.2d 339, 342 (1992) (quoting Collingwood v. G.E. Real Estate Equities, 324 N.C. 63, 66, 376 S.E.2d 425, 427 (1989)). Once the movant meets his burden, the burden then shifts to the non-moving party to show that a genuine issue exists by forecasting sufficient evidence of all essential elements of their claim. Waddle v. Sparks, 331 N.C. 73, 82, 414 S.E.2d 22, 27 (1992). The court must look at the evidence in the light most favorable to the non-moving party and with the benefit of all reasonable inferences. Isbey v. Cooper Companies, 103 N.C. App. 774, 775, 407 S.E.2d 254, 256 (1991), disc. review denied, 330 N.C. 613, 412 S.E.2d 87 (1992). Plaintiff argues that N.C. Gen. Stat. § 97-6 prohibits the use of releases by employers to obtain relief from the obligations created under the Workers’ Compensation Act. N.C. Gen. Stat. § 97-6 (1991) provides the following: No contract or agreement, written or implied, no rule, regulation, or other device shall in any manner operate to relieve an employer in whole or in part, of any obligation created by this Article, except as herein otherwise expressly provided. Furthermore, plaintiff contends that a release does not bar a retaliatory discharge claim under N.C. Gen. Stat. § 97-6.1 (repealed 1991, effective 1 October 1992, reenacted as part of Art. 21 of Ch. 95 of the General Statutes, effective 1 October 1992) unless it satisfies the exception under N.C. Gen. Stat. § 97-17. This exception allows “settlements . . . between the employee and employer so long as the amount of compensation and the time and manner of payment are in accordance with the provisions of this Article . . . [and] approved by the Industrial Commission.” N.C. Gen. Stat. § 97-17 (1991). Plaintiffs position is that the exception of N.C. Gen. Stat. § 97-17 applies to claims for lost wages and medical benefits, not retaliatory discharge. Even assuming retaliatory discharge was within this statute, plaintiff argues, the release was not approved by the Industrial Commission. Plaintiff argues the release does not fall within the exception and cannot serve as a bar to plaintiff’s retaliatory discharge claim. We disagree. The primary rule of statutory construction is that the intent of the legislature controls the interpretation of a statute. Derebery v. Pitt County Fire Marshall, 318 N.C. 192, 196, 347 S.E.2d 814, 817 (1986). To determine this intent, the courts should consider the language of the statute, the spirit of the act, and what the act seeks to accomplish. Id. The court must also consider the law that existed at the time of the statute’s enactment to determine legislative intent. News & Observer Publishing Co. v. State of North Carolina, ex. rel. Haywood Starling, 312 N.C. 276, 282, 322 S.E.2d 133, 137 (1984). The North Carolina Workers’ Compensation Act was enacted in 1929 to provide employees swift and certain compensation for injuries suffered on the job, while limiting the liability of employers. Rorie v. Holly Farms Poultry Co., 306 N.C. 706, 709, 295 S.E.2d 458, 460 (1982). N.C. Gen. Stat. §§ 97-6 and -17 were enacted as part of the North Carolina Workers’ Compensation Act in 1929 to protect employees from employers who would try to circumvent the Act through contracts to waive benefits. For this reason, settlement agreements for workers’ compensation claims must be submitted to the Industrial Commission for approval. N.C. Gen. Stat. § 97-17 (1991). On the other hand, the General Assembly enacted N.C. Gen. Stat. § 97-6.1 in 1979 forbidding retaliatory discharge of employees for filing workers’ compensation claims. This retaliatory discharge statute does not compensate employees for injuries on the job nor does it protect limited liability of employers; if anything, it increases the liability of employers. Furthermore, N.C. Gen. Stat. § 97-6.1 overruled Dockery v. Lampart Table Co., 36 N.C. App. 293, 244 S.E.2d 272, disc. review denied, 295 N.C. 465, 246 S.E.2d 215 (1978), where this Court refused to make an exception to North Carolina’s employment-at-will rule for employees who were discharged in retaliation for filing workers’ compensation claims. Case law in the employment law area tends to suggest that the intent of the statute was to provide an exception to the employment-at-will doctrine, not to provide further benefits under the Workers’ Compensation Act. See, e.g., Sides v. Duke Hospital, 74 N.C. App. 331, 328 S.E.2d 818, disc. review denied, 314 N.C. 331, 333 S.E.2d 490 (1985); Coman v. Thomas Mfg. Co., 325 N.C. 172, 381 S.E.2d 445 (1989). Likewise, the fact that the General Assembly repealed N.C. Gen. Stat. § 97-6.1 and recodified it in N.C. Gen. Stat. § 95-241 (1991) (effective 1 October 1992), which specifically addresses retaliatory employment discrimination, further advances this view. We also note several differences between the retaliatory discharge statute and the remainder of the North Carolina Workers’ Compensation Act. First, the Industrial Commission has jurisdiction to determine whether an employee is entitled to compensation under the Act. N.C. Gen. Stat. § 97-91 (1991). Under prior law, jurisdiction for retaliatory discharge claims rests in the General Court of Justice. N.C. Gen. Stat. § 97-6.1(d). Second, workers’ compensation benefits are not fault based, have a two-year statute of limitations, and the benefits scheme is specific in terms of schedule of injuries and rate and period of compensation. Recovery under the retaliatory discharge statute depends on the employer’s motive, making fault an issue. Also, the statute of limitations is one year, and the plaintiff is entitled to reasonable damages suffered. Third, Article V of the Rules of the North Carolina Industrial Commission provides that agreements to settle claims for compensation must be submitted to the Industrial Commission. I.C. Rule 501. Retaliatory discharge claims do not provide compensation; therefore, agreements settling these actions need not be submitted to the Industrial Commission. Based on the foregoing reasons, we conclude that N.C. Gen. Stat. § 97-6 does not apply to retaliatory discharge claims. Retaliatory discharge is not an “obligation” within the contemplation of this rule. Obligation refers only to benefits paid under this Act. N.C. Gen. Stat. § 97-6 does not bar the Release and Severance Agreement. In light of this ruling, we need not reach plaintiff’s contention that there is a genuine issue of material fact with respect to motivation. We hold the trial court properly granted summary judgment for defendants on both the plaintiffs claim and defendants’ counterclaim. The trial court is Affirmed. Chief Judge ARNOLD and Judge LEWIS concur.
HERWEYER v CLARK HIGHWAY SERVICES, INC Docket No. 171720. Submitted March 15, 1995, at Grand Rapids. Decided July 11, 1995, at 9:10 a.m. Leave to appeal sought. Jack Herweyer brought an action in the Missaukee Circuit Court against Clark Highway Services, Inc., alleging breach of an employment contract, discrimination, and retaliatory discharge. The court, Charles D. Corwin, J., granted summary disposition for the defendant, ruling that the action, which had been brought thirty-one months after the discharge, was not timely under the limitation provisions of the contract. The plaintiff appealed. The Court of Appeals held: 1. A contractual limitation period that is shorter than the applicable statutory period of limitation will be upheld if it is reasonable. A contractual period is reasonable where the claimant has a sufficient opportunity to investigate and file an action, the time is not so short as to be a practical abrogation of the right of action, and the action is not barred before loss or damages can be ascertained. In this case, where the contract provided a six-month limitation period and a saving clause stating that any term found to be legally unenforceable as written is to be limited in application so as to allow the enforcement of the term as far as legally possible, the trial court did not err in concluding that, even if the six-month period was unreasonable, the limitation period could be saved by reading it as providing for an unspecified minimum reasonable time that is less than thirty-one months. 2. The question whether it is against public policy to allow employers to shorten by contract limitation periods for actions brought by employees is best addressed by the Legislature, not the Court of Appeals. Affirmed. Neff, J., dissenting, stated that the six-month limitation period under the contract was unreasonable, that the saving clause was vague and ambiguous and should be stricken from the contract, that the statutory three-year period of limitation should apply, and that the case should be remanded for trial. Alternatively, the matter should be remanded for a hearing to determine whether thirty-one months was a reasonable contractual period of limitation. References Am Jur 2d, Limitation of Actions §§ 64, 65. See ALR Index under Contracts; Limitation of Actions. Limitation of Actions — Contracts — Statutes of Limitation. A contractual limitation period that is shorter than the applicable statutory period of limitation will be upheld if it is reasonable; a contractual period is reasonable where the claimant has a sufficient opportunity to investigate and file an action, the time is not so short as to be a practical abrogation of the right of action, and the action is not barred before loss or damages can be ascertained. Bott & Spencer, P.C. (by R. Dillon McCormick), for the plaintiff. Warner, Norcross & Judd (by Robert J. Chovanec, Douglas E. Wagner, and Rodrick W. Lewis), for the defendant. Before: Sawyer, P.J., and Griffin and Neff, JJ. Sawyer, P.J. Plaintiff appeals from an order of the circuit court granting summary disposition in favor of defendant on plaintiff’s claim for breach of contract, discrimination, and retaliatory discharge on the basis of the claim not having been timely brought under the provisions of that contract. We affirm. Plaintiff entered into an employment contract with defendant, which contract included provisions that any claims arising from the termination of employment must be brought within six months and that plaintiff specifically waived any applicable statute of limitations to the contrary. Plaintiff was discharged after filing a worker’s compensation claim. Thirty-one months later, plaintiff brought the instant action. Defendant moved to have the action dismissed on the basis of the contractual provision of bringing all claims within six months, and the trial court granted summary disposition. We first jointly consider two of plaintiffs arguments, namely that the trial court erred in granting summary disposition when the applicable statute of limitations had not run and whether the contractual provision of a six-month limitation was unreasonable and, therefore, the full statutory period should be applied. It is settled law in Michigan that the courts will uphold a contractual provision limiting the time to bring suit where that limitation is reasonable, even though the period specified is less than the applicable statute of limitations. Camelot Excavating Co, Inc v St Paul Fire & Marine Ins Co, 410 Mich 118, 126; 301 NW2d 275 (1981). The determination of such reasonableness is made by looking at whether the claimant had a sufficient opportunity to investigate and file an action, the time was not so short as to be a practical abrogation of the right of action, and the action was not barred before the loss or damages could he ascertained. Id. at 127. In the case at bar, the trial court expressed its reservation that the six-month limitation provided for in the contract may not be reasonable, but concluded that in any event a reasonable time would be less than the thirty-one months in which it took plaintiff to commence suit and, therefore, plaintiffs action was barred by the contractual provision. Plaintiff, in essence, argues that if the six-month period is unreasonable, then the statutory provision of a three-year period of limitation must be applied. In concluding that the contract can be read to provide for a reasonable period of limitation less than the three years provided by statute, but nonetheless more than the six months specifically provided in the contract, the trial court looked to a provision in the contract that stated that if any term was found to be legally unenforceable as written, the particular provision would be limited to allow its enforcement as far as legally possible. The trial court interpreted this provision to mean that even if the six-month period provided in the contract was unreasonable, that provision would then be read as providing for the minimum reasonable time. While the trial court did not specifically indicate what the minimum reasonable time was, it did determine that it was less than the thirty-one months that it took plaintiff to bring suit. We agree with the trial court’s interpretation of the contract. The savings clause in the contract can be read as providing that the period of limitation shall be the minimum reasonable time in excess of six months. Furthermore, like the trial court, we agree that thirty-one months is in excess of the minimum reasonable time. While we do not draw a bright line with respect to what the minimum reasonable time is, we are not persuaded that plaintiff required thirty-one months in which to investigate and file the action, nor would a period of less than thirty-one months operate as a practical abrogation of the right to sue and certainly did not bar the bringing of the action before the loss or damage could be ascertained. See Camelot, supra at 127. Therefore, whatever the minimum reasonable time is, it is less than thirty-one months. Accordingly, the action was barred by the provisions of the contract at the time plaintiff brought the action. Thus, the trial court properly granted summary disposition in favor of defendant. Plaintiff also argues that allowing employers to shorten the statute of limitations for employment actions is contrary to public policy. That may or may not be the case, but we believe it presents a public policy question best addressed by the Legislature, not this Court. The Legislature is in a superior position to consider the arguments, consider the ramifications of restricting the right to contract in this area, and determine what is in the public interest. If the Legislature deems such contractual provisions to be contrary to public policy, it may endeavor to enact the appropriate legislation. We, however, decline to impose by judicial fiat such restrictions on the right to contract. Affirmed. Defendant may tax costs. Griffin, J., concurred. Neff, J. (dissenting). The trial court and the majority here reached the conclusion that the six-month limitation period contained in the "application for employment” is unreasonable, and I agree with that conclusion. However, I cannot agree that a further provision in the application to the effect that if the six-month term is found to be unenforceable, then a "minimum reasonable time” is to be determined and enforced "as far as legally possible” can properly be read to support the conclusion that thirty-one months is unreasonably long. . i As a preliminary matter, I note that the language of the contract is vague and ambiguous. It seems obvious that the drafter (presumably defendant or its attorney) contemplated the probability that the six-month limitation period would be attacked in these circumstances and the possibility of a finding that it is unreasonable, as was found to be the case. In anticipation of this result the "minimum reasonable time” and "as far as legally possible” language were added, but without any effort to define these imprecise terms, leaving the parties, and ultimately the courts, with the task of interpretation case by case. This situation leads to an inexact limitation period and, inevitably, to the possibility of different limitation periods arising out of the same contract language. I find this potential to be untenable. Surely, parties are entitled to certainty in their legal dealings to a greater degree than this contract language allows, particularly with regard to the time limits that govern their mutual rights to seek redress against each other in the courts. Because it is ambiguous and might lead to unreasonable results, I would construe this language strictly against the drafter and strike it from the agreement. See DeMello v McNamara, 178 Mich App 618, 623; 444 NW2d 149 (1989). This would restore the parties to reliance on the applicable statutory limitation periods that have been established by the Legislature. This result would serve a number of important purposes. First, it would provide certainty to the determination of the time in which to bring suit. Second, as the legislative articulation of the limitation period, it is a simple, straightforward, and objective measure of what time period is "reasonable.” ii Next, I share the concerns expressed by the trial court with regard to the public policy arguments raised by plaintiff. Shortening the statute of limitations to six months will result in premature litigation because parties will be forced to rush to file suit before they have the opportunity to mitigate damages or fully investigate their claims. This is not in keeping with the purpose of a statute of limitations, that is, to protect defendants against stale or fraudulent claims. See Larson v Johns-Manville Sales Corp, 427 Mich 301, 310; 399 NW2d 1 (1986). In addition, an employee who must choose between signing an agreement such as the one in this case or risking termination does not deal at arm’s length with the employer. This is not a commercial setting where the parties could negotiate the terms of their agreement with regard to the limitation period or even one in which the employee was represented by a labor union that could have negotiated the terms and conditions of employment on his behalf. Where the parties are not on equal footing, the reduction in the limitation period for causes of action pursuant to remedial statutes should not be permitted lightly. hi Further, my review of the record reveals that there is nothing to establish whether the thirty-one-month time period between termination and filing was reasonable. If we assume that the language of the application permits a judicial determination of a limitation period more than six months but less than the period established by the Legislature, then defendant has the burden of showing that the elapsed time was unreasonable and plaintiff should have the opportunity to establish whether the time period in question was reasonable. The determination should, in any event, be measured by some'objective standard of reasonableness. It is not enough to say, as the trial court did, that while we agree that a six-month period is unreasonably short and therefore unenforceable, thirty-one months exceeds the fuzzy "minimum reasonable time,” but without articulating any reasons for that finding and without saying just how much time does fit within the "minimum reasonable time.” At the very least, we should remand this case to give plaintiff the opportunity to establish whether thirty-one months is reasonable within the context of this case. IV Finally, I note that the majority relies for its conclusion on Camelot Excavating Co, Inc v St Paul Fire & Marine Ins Co, 410 Mich 118; 301 NW2d 275 (1981). In my view, that case is distinguishable from this one and does not support the result for which it is cited as authority. The Camelot case involved a shortened statute of limitations in a construction bond. Two commercial entities, a general plumbing contractor and an insurance company, were the principal and the surety on the bond, which was a labor and material bond, the purpose of which was to protect the owner of the construction project against claims of those who furnished labor or materials to the contractor. The owner of the project was therefore a third-party beneficiary of the bond contract. There is nothing remotely similar in the fact situation of this case where the employer and an individual employee are parties to the application that shortens the limitation period solely for the benefit of the employer. Ultimátely, I agree with Justice Levin’s concurring opinion in Camelot, supra at 140-143, that the holding there is limited to the narrow circumstances of that case. Specifically, I agree with the following statement: The rationale of the rule allowing parties to contractually shorten statutory periods of limitation is that the shortened period is a bargained-for term of the contract. Allowing such bargained-for terms may in some cases be a useful and proper means of allowing parties to structure their business dealings. [Id. at 141.] Thus, to the extent this, rule is applicable in other settings, I would require that the parties to the contract, in contrast to the parties here, be more equal with regard to bargaining power. See, e.g., Rowry v Univ of Michigan, 441 Mich 1, 19, n 2; 490 NW2d 305 (1992), concurring opinion of Riley, J. (suggesting that public policy does not prohibit parties to a collectively bargained for agreement from shortening the period of limitation). By allowing this rule to apply in situations involving parties possessing unequal bargaining power, the majority will be allowing one of the contracting parties to unilaterally supplant the period of limitation mandated by the Legislature, a questionable practice from a public policy standpoint. Camelot, supra at 141. Accordingly, I would reverse and remand for trial or, in the alternative, for a hearing to determine if a thirty-one-month time period was reasonable on the basis of the facts of this case.
GARAVAGLIA v CENTRA, INC Docket No. 148153. Submitted October 19, 1994, at Detroit. Decided June 23, 1995, at 9:35 a.m. Leave to appeal sought. Charles Garavaglia brought an action in the Wayne Circuit Court against Centra, Inc., Central Transport, Central Cartage Company, and Manuel J. and Agnes A. Moroun, alleging age discrimination in employment, breach of an employment contract terminable for just cause only, discharge from employment in breach of public policy, tortious interference with contractual relations, and violation of the Employee Right to Know Act, MCL 423.501 et seq.; MSA 17.62(1) et seq. The plaintiff also sought a declaration regarding the existence of a contract and an order providing for the specific performance of the contract. The jury returned a verdict for the plaintiff, and the court, Claudia House Morcom, J., entered a judgment consistent with the verdict. The defendants, except Agnes A. Moroun, appealed from the judgment entered by the trial court. The Court of Appeals held: 1. Defendants’ claim that the plaintiff cannot recover damages for both breach of an employment contract terminable for just cause only and discharge from employment in breach of public policy was not preserved for appellate review. 2. The jury instructions regarding the alleged breach of public policy adequately informed the jury of the applicable law. 3. A claim regarding an alleged breach of public policy may be premised on the alleged violation of a federal statute. An employer at will is not free to discharge an employee when the reason for the discharge is an intention on the part of the employer to contravene the public policy of this state. 4. The National Labor Relations Act, 29 USC 158(b)(1)(B), imposes a duty on a union not to influence or interfere with an emp1 oyer’s choice of a bargaining representative. The plaintiff was entitled to be his employer’s bargaining representative without being pressured to leave by the union involved. References Am Jur 2d, Labor and Labor Relations § 2385; Wrongful Discharge §§ 11, 19, 23-39, 44. See ALR Index under At-Will Relationship; Discharge from Employment or Office; Public Policy; Unfair Labor Practices. 5. The plaintiff presented sufficient evidence of a claim for breach of public policy to withstand the defendants’ motion for a directed verdict. A rational trier of fact legitimately could infer that the union pressured the defendants into firing the plaintiff in order to achieve labor peace. 6. The trial court’s order taxing costs must be affirmed. Affirmed. 1. Labor Relations — Unfair Labor Practices — Labor Relations Representatives. It is an unfair labor practice for a union to coerce an employer regarding the selection of the employer’s labor relations representative; the National Labor Relations Act confers a right upon an employee to be the employer’s bargaining representative without being pressured to leave by the union (29 USC 158[b][l][B]). 2. Labor Relations — At-Will Employees — Discharge — Breach of Public Policy — Federal Statutes. An employee at will may not be discharged when the reason for the discharge is the employer’s intention to contravene the public policy of this state; a claim regarding a breach of public policy may be premised on the alleged violation of a federal statute. 3. Labor Relations — Employment At Will — Exceptions — Public Policy. An exception to the employment at will doctrine is recognized on the basis of the principle that some grounds for discharging an employee are so contrary to public policy as to be actionable; another exception exists where there are explicit legislative statements prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty (however, a public policy claim is sustainable only where there is no applicable statutory prohibition against discharge in retaliation for the conduct at issue); a third exception exists where the alleged reason for the discharge was the employee’s failure or refusal to violate a law in the course of employment; a fourth exception exists where the alleged reason for the discharge was the employee’s exercise of a right conferred by a well-established legislative enactment. Gottlieb & Goren, P.C. (by Charles Gottlieb), for the plaintiff. Plunkett & Cooney, P.C. (by Ernest R. Bazzana and Kelly A. Freeman), for the defendants. Before: Wahls, P.J., and Jansen and J. P. Noecker, JJ. Circuit judge, sitting on the Court of Appeals by assignment. Jansen, J. Defendants Centra, Inc., Central Transport, Central Cartage Company, and Manuel J. Moroun (hereafter defendants), appeal as of right from a jury verdict for plaintiff in the amount of $197,500 in this action alleging wrongful discharge. We affirm. Plaintiff filed his complaint in the Wayne Circuit Court, alleging age discrimination, breach of an employment contract terminable for just cause only, discharge in breach of public policy, tortious interference with contractual relations, violation of the Employee Right to Know Act, MCL 423.501 et seq.; MSA 17.62(1) et seq., and seeking a declaratory judgment (specific performance). A jury found for plaintiff with regard to the claim of breach of an employment contract terminable for just cause only (awarding $60,000), the claim of breach of public policy (awarding $100,000), and the declaratory judgment claim (awarding $37,500 for breach of a written retainer fee contract). Defendants now contest the verdict with regard to the claim of breach of public policy. Plaintiff alleged that his employment was terminated in breach of public policy on the bases that defendants submitted to union demands that they fire plaintiff to achieve "labor peace,” that plaintiff failed to obey defendants’ request to destroy documents subpoenaed by a federal grand jury, and that plaintiff blocked an offer by the union to dismiss a lawsuit by refusing to agree not to countersue the union. Defendants admitted in their trial brief that they terminated plaintiffs employment because of union pressure that there would be no labor peace unless plaintiff was removed. It was plaintiffs contention that it was a violation of the National Labor Relations Act (nlra) for the union to influence defendants in their choice of a bargaining representative. 29 use 158(b)(1)(B). i Defendants first contend that the jury verdict regarding the claim of breach of public policy must be vacated because plaintiff cannot recover damages for both breach of an employment contract terminable for just cause only and discharge in breach of public policy. We find that this issue is not properly preserved for appellate review. Defendants never argued below that breach of an employment contract terminable for just cause only and breach of public policy are alternative theories and that plaintiff cannot recover under both. Issues raised for the first time on appeal ordinarily are not subject to review. Booth Newspapers, Inc v Univ of Michigan Bd of Regents, 444 Mich 211, 234; 507 NW2d 422 (1993). Because this issue was never raised below, we decline to review it. See Peterman v Dep’t of Natural Resources, 446 Mich 177, 183; 521 NW2d 499 (1994) (it is a "time-honored rule that, absent unusual circumstances, issues not raised at trial may not be raised on appeal”). ii Defendants next contend that the trial court erred in denying their motion for a directed verdict with regard to the claim of breach of public policy. Plaintiffs claim regarding breach of public policy was based on the nlra. Specifically, plaintiff alleged that defendants breached public policy by yielding to union demands to fire plaintiff. Pursuant to 29 USC 158(b)(1)(B), it is an unfair labor practice for a union to coerce an employer regarding the selection of the employer’s labor relations representative. Defendants contend that plaintiffs claim is legally insufficient because Michigan does not recognize an implied cause of action for breach of public policy when an employer violates federal law. Defendants also contend that the nlra does not confer rights on plaintiff and, because he is not protected by the nlra, he cannot receive a remedy for the alleged violation. We first note that the question regarding legal sufficiency raised by defendants was not raised in the trial court in their motion for a directed verdict. Rather, defendants raised this issue by objecting to the trial court’s instructions regarding the alleged breach of public policy. Thus, with regard to the issue concerning legal sufficiency, we review the trial court’s instructions as a whole. The question is whether the instructions as given adequately informed the jury of the applicable law reflecting the various evidentiary claims in the particular case. Riddle v McLouth Steel Products Corp, 440 Mich 85, 101; 485 NW2d 676 (1992). We find that the jury instructions adequately informed the jury of the applicable law. In Suchodolski v Michigan Consolidated Gas Co, 412 Mich 692, 695; 316 NW2d 710 (1982), the Supreme Court stated that an exception to the employment at will doctrine will be recognized on the basis of the principle that some grounds for discharging an employee are so contrary to public policy as to be actionable. First, an exception exists where there are explicit legislative statements prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty. Id. Second, such a cause of action has been found to be implied where the alleged reason for the discharge of the employee was the failure or refusal to violate a law in the course of employment. Id. Finally, a cause of action has also been found to be implied where the alleged reason for the discharge was the employee’s exercise of a right conferred by a well-established legislative enactment. Id., p 696. To some extent, the first of the three grounds in Suchodolski has been limited in Dudewicz v Norris Schmid, Inc, 443 Mich 68, 80; 503 NW2d 645 (1993), where the Court held that a public policy claim is sustainable only where there is not an applicable statutory prohibition against discharge in retaliation for the conduct at issue. The trial court instructed the jury in pertinent part as follows: Now, you are instructed that if you find the plaintiff was dismissed from his employment or from performing the obligations, the duties and demands of his office or release from his employment service, or moved from a greater job to a lesser job that you may find that plaintiff was wrongfully discharged. You are further instructed that an employer is not free to discharge, discipline or otherwise adversely treat an employee who acts in accordance with the statutory right or duty, or where the employee fails or refuses to violate the law in the course of his employment; nor can the employer discharge the employee when the reason for the discharge is an intention on the part of the employer to contravene the public policy of Michigan or the United States. Now, you are further instructed that it is against public policy to restrain or coerce an employer in the selection of its representative for collective bargaining or adjustment of grievances or; secondly, to refuse to bargain with an employer based on the employers’ selection of its representative. We find that the trial court’s instructions adequately informed the jury of the law. We agree with plaintiff that a claim regarding a breach of public policy may be premised on the alleged violation of a federal statute. Other jurisdictions have also recognized a wrongful discharge action based on a clearly articulated federal policy. Sherman v St Barnabas Hosp, 535 F Supp 564 (SD NY, 1982); D’Agostino v Johnson & Johnson, Inc, 133 NJ 516; 628 A2d 305 (1993). Further, the fact that the nlra does not specifically confer rights upon plaintiff is not dispositive. As this Court has stated, "the better view is that an employer at will is not free to discharge an employee when the reason for the discharge is an intention on the part of the employer to contravene the public policy of this state.” Sventko v Kroger Co, 69 Mich App 644, 647; 245 NW2d 151 (1976). Thus, it is the fact that the employer discharged plaintiff in contravention of the public policy of this state that permits plaintiff’s claim regarding the breach of public policy. In any event, plaintiff was entitled to be the employer’s bargaining representative without influences from the union. Under the nlra, a duty is imposed on the union not to influence or interfere with an employer’s choice of a bargaining representative. Accordingly, the nlra did confer a right upon plaintiff to be the bargaining representative without being pressured to leave by the union. Under these circumstances, the third prong of Suchodolski is satisfied because a cause of action may be had where the alleged reason for the discharge is the employee’s exercise of a right conferred by a well-established legislative enactment. Next, defendants contend that plaintiff failed to prove a prima facie case of breach of public policy and that the trial court, therefore, erred in denying their motion for a directed verdict. When evaluating a motion for a directed verdict, the court must consider the evidence in a light most favorable to the nonmoving party, making all reasonable inferences in the nonmoving party’s favor. Locke v Pachtman, 446 Mich 216, 223; 521 NW2d 786 (1994). Directed verdicts are appropriate only when no factual question exists upon which reasonable minds may differ. Brisboy v Fibreboard Corp, 429 Mich 540, 549; 418 NW2d 650 (1988). We find that plaintiff presented sufficient evidence at trial of a claim for breach of public policy. Plaintiff alleged that defendants terminated his employment by yielding to union demands that terminating his employment was the only way of achieving labor peace. Plaintiff testified that he was told that he would be removed from labor relations because he had been rendered neutral with the union during the many "snowballs” with other transportation companies. According to plaintiff, defendants were taking over the bankruptcies of other transportation companies, closing out the operations and creating confrontations with the unions in the bankruptcy courts. Plaintiff met with Manuel Moroun and it was reiterated that defendants’ actions put plaintiff in the position that he had problems with the unions. Moroun made clear to plaintiff that plaintiff’s work was satisfactory and that he knew that plaintiff was loyal. Further, defendants admitted in their opening statement that the union made clear to Moroun that it did not want to deal with plaintiff. Taking this evidence in a light most favorable to plaintiff and drawing all legitimate inferences therefrom, we find that plaintiff presented sufficient evidence regarding his claim of breach of public policy to withstand a motion for a directed verdict. A rational trier of fact legitimately could infer that the union pressured defendants into firing plaintiff in order to achieve labor peace. m Last, defendants argue that the trial court’s order taxing costs should be reversed if this Court vacates the jury verdict or grants a new trial. Because we are affirming the jury’s verdict, we also affirm the trial court’s order taxing costs pursuant to MCR 2.625(A) and (B). Affirmed.
JOHN D. GRAY, Petitioner v. ORANGE COUNTY HEALTH DEPARTMENT, Respondent No. 9310SC27 (Filed 6 June 1995) 1. Administrative Law and Procedure § 63 (NCI4th)— dismissal of health department employee — petition for judicial review — lack of specificity The trial court erred by denying respondent’s motion to dismiss petitioner’s petition for judicial review of his dismissal as a county health department inspector, since the petition failed to meet the specificity requirements of N.C.G.S. § 150B-46 in that it lacked even a single exception to particular findings of fact or conclusions of law and set forth no basis for alleging that the final decision of dismissal was “arbitrary and capricious,” except perhaps the statement that it contradicted the recommended decisions of the administrative law judge and the State Personnel Commission which were advisory only. Am Jur 2d, Administrative Law §§ 561, 562, 564. 2. Administrative Law and Procedure § 67 (NCI4th) — dismissal of health department employee — reversal of health department director’s decision — error by trial court The trial court erred in reversing the decision of the county health department director to dismiss petitioner who was a sanitation inspector where the petition for judicial review alleged no objection to any particular finding of fact in the Final Decision, and each of those findings was therefore binding on the superior court; the trial court’s outright rejection of respondent’s director’s findings and conclusions, followed by adoption instead of the findings of the administrative law judge and the State Personnel Commission, therefore reflected improper application of the “whole record test” and erroneous substitution of the court’s judgment for that of the agency as contained in the Final Decision; and proper application of the whole record test supported the conclusion that “just cause” existed to discharge petitioner from employment on grounds of unacceptable personal conduct in making romantic overtures and inappropriate sexually suggestive comments to regulated parties. Am Jur 2d, Administrative Law §§ 417, 636, 642. Judge Greene concurring in part. Appeal by respondent from order entered 1 October 1992 by Judge Robert L. Farmer in Wake County Superior Court. Heard in the Court of Appeals 18 November 1993. Crisp, Davis, Page, Currin & Nichols, by M. Jackson Nichols and Elizabeth T. Dierdorf, for petitioner-appellee. Coleman, Gledhill & Hargrave, by Geoffrey E. Gledhill, for respondent-appellant. JOHN, Judge. Respondent-appellant Orange County Health Department (the Department) appeals an order of the superior court reversing the termination from employment of petitioner-appellee John D. Gray (Gray). In its ruling, the court also ordered Gray reinstated to his former position and awarded him $5,047.33 in costs and $25,000.00 in attorney fees. Under the circumstances of this case, we believe the trial court erred. Pertinent factual and procedural information is as follows: On 5 February 1990, Orange County Health Director Daniel B. Reimer (the Director, Reimer) suspended Gray with pay from the position of Registered Sanitarian pending investigation of several complaints. On 22 March 1990, Gray sought to contest his suspension by filing a Petition for Hearing in the Office of Administrative Hearings (OAH) pursuant to N.C. Gen. Stat. § 126-35 (1993) and Chapter 150B of our General Statutes (the Administrative Procedure Act). Following Reimer’s investigation, Gray was discharged from employment with the Department 7 May 1990 on grounds of unacceptable personal conduct. [Pertinent particulars of Gray’s alleged conduct are detailed in the Final Decision quoted infra.] Gray thereafter filed a second OAH Petition 20 June 1990, claiming inter alia his dismissal was not grounded upon “just cause” and thus violated the State Personnel Act. Consolidation of the two petitions was subsequently allowed. A four-day hearing on Gray’s petitions commenced 16 April 1991, with Administrative Law Judge Peter J. Sarda (ALJ Sarda) issuing his Proposed Decision 12 September 1991. Sarda ruled the Department had failed to establish “just cause” for Gray’s dismissal under G.S. § 126-35 and ordered his reinstatement. On 14 February 1992, the State Personnel Commission (SPC) issued its “Decision and Order” in the matter, expressly adopting as its own the findings of fact and conclusions of law reached by ALJ Sarda. Pursuant to N.C. Gen. Stat. §§ 130A-41(b)(12).(1992) and 126-37 (1993), Director Reimer entered his Final Decision in this matter on 13 March 1992, pertinent portions of which read as follows: I. FINDINGS OF FACT A. Complaint of Lynn Rollins 1. On June 28, 1988, Mr. John Gray met with Ms. Lynn Rollins and conducted an initial inspection of the kitchen facility in which Ms. Rollins planned to conduct a catering business. 3. At this June 2[8], 1988 meeting, Mr. Gray suggested to Ms. Rollins that she go with him to the beach in a private airplane. Mr. Gray stated to Ms. Rollins that she would look great in a bathing suit. Mr. Gray also asked Ms. Rollins out to dinner. Mr. Gray seemed to be preoccupied with establishing a personal relationship with Ms. Rollins rather than dealing with her questions about establishing a catering operation. 4. Carol Layh . . . heard Mr. Gray invite Ms. Rollins out to dinner. 5. In Ms. Rollins’ opinion and in Ms. Layh’s opinion, Mr. Gray was “coming on” to Ms. Rollins. 8. In May of 1989, the Health Department received a complaint from another Orange County regulated caterer that Ms. Rollins was operating her catering business from her home without a permit. This complaint was verified by Mr. Gray who instructed Ms. Rollins that she would have to stop catering in Orange County until she obtained the necessary permit. 10. Ms. Rollins ceased doing catering work from her home and immediately thereafter called several restaurants and located three that were willing to share the use of their facilities. Ms. Rollins then called Mr. Gray and tried to set an appointment with him to inspect the three restaurants she had lined up. Mr. Gray told her that she was moving too fast and that her proposed arrangements would not be possible. 12. Mr. Gray also told Ms. Rollins at this time that two regulated restaurant businesses could not operate out of the same kitchen facility. 13. In fact no law or regulation prohibited multiple use of one kitchen facility and the Health Department did not have a policy forbidding this practice. 14. As an alternative to sharing kitchen space, Ms. Rollins informed Mr. Gray that she had a small cottage on her property that she would be willing to renovate to use as a kitchen. 15. Without visiting Ms. Rollins’ cottage, Mr. Gray informed her that he was sure such a proposal would not work and that he just could not conceive that it would work out. 16. Because of the lack of cooperation Ms. Rollins was receiving from Mr. Gray, . . . [she] called Mr. [Tony] Laws [Mr. Gray’s supervisor]. 17. Mr. Laws agreed to meet with Ms. Rollins at her home. During this visit he looked at the proposed cottage and felt that it could, with improvements, provide an acceptable facility for a catering operation. 18. It was during this visit that Ms. Rollins related her belief to Mr. Laws that Mr. Gray was not assisting her because she had previously rejected his advances. 19. . . . Ms. Rollins . . . was unwilling to [speak to Mr. Reimer about her situation and the conduct of Mr. Gray]... as she did not want to cause herself any unnecessary trouble while she was a regulated party subject to the oversight of Mr. Gray. 21. On June 20, 1989, Mr. Laws, Mr. Jack Knight (District Sanitarian for the State), and Mr. Gray inspected the cottage facility and the kitchen facility located at Beaugart’s restaurant as possible kitchen facilities for Ms. Rollins to use for her catering business. Both facilities were found acceptable by all three men, and a permit was issued to Ms. Rollins .... 22. At some later point, Ms. Rollins decided to operate her catering business in Durham [as opposed to Orange] County, North Carolina . . . [because] she did not want to operate in the county in which Mr. Gray worked. B. Complaint of Hillary Ensminger 23. On June 21, 1989, Mr. Gray inspected the kitchen facility leased by Jeff and Hillary Ensminger . . . and issued a permit to them for the operation there of their catering business, the Wandering Feast. 25. On June 27, 1989, Mr. Gray took a water sample from the kitchen facility which, upon examination by the State Health Lab, indicated the presence of fecal coliform. 26. On July 10, 1989, Mr. Gray took a second water sample which . . . again indicated the presence of fecal coliform. 27. During this visit by Mr. Gray on July 10, 1989, Mrs. Ensminger told Mr. Gray that she would need to confer with her husband about the problem with the water and its effect on their business. As she prepared to call him on the telephone, Mr. Gray remarked, “Well, we can see who’s in authority in this relationship,” or words to that effect. Mr. Gray then said, “Well, we can see who’s on top in this relationship,” or words to that effect. These two statements were then followed by Mr. Gray making a sexually related remark using the word “sex” or the phrase “sexual relationship.” Mr. Gray then inquired of M[r]s. Ensminger how often she and her husband engaged in sexual relations. 28. These remarks made by Mr. Gray to Mrs. Ensminger were heard by John Wilson, then an employee of the Wandering Feast. 29. Mrs. Ensminger did not react to these comments at this time as she was shocked and because she had been raised to respect and trust persons in positions of authority. 30. Mrs. Ensminger did not bring these comments to the attention of her husband as she did not want to bring any trouble to their business and because the whole episode was unseemly to her. 31.But for Mr. Gray’s position of authority over her business she would not .have tolerated such conduct. She was intimidated by Mr. Gray because of his position as a health inspector. 35. On October 10, 1989, after additional water samples showed the presence of fecal coliform, Mr. Gray . . . suspended the [Ensmingers’] restaurant permit. 36. On the same day, October 10, 1989, Mr. Gray also conducted the fourth quarter inspection of the premises and recorded a score of 88, or “B” grade. 37. The points deducted for the contaminated water supply from the inspection of the kitchen . . . were the difference between an “A” grade and a “B” grade. 38. Mr. Gray had the discretion to conduct this fourth quarter inspection at any time before December 31, 1989. 39. The Ensmingers did not receive an adequate explanation from Mr. Gray or from any representative of the Health Department justifying Mr. Gray’s decision to inspect their facility while their restaurant permit was suspended and their business closed. 40. On December 1.0[,] 19[89], the suspension was lifted, but no inspection was performed by Mr. Gray. This resulted in the “B” grade . . . remaining] in effect. ... As testified to by Mr. Ensminger, the receipt of anything lower than an “A” grade is very damaging to the business of a caterer and a restauranteur [sic]. 41. Some time after December 10, 1989, Mr. Ensminger met with Mr. Laws and complained of several items relevant to Mr. Gray’s conduct, including: 1) the fact that an inspection was conducted by Mr. Gray while their operating permit was suspended, and 2) the fact that he did not like Mr. Gray being around his wife C. The Investigatory Process 47. . . . [Later,] Mr. Laws contacted Ms. Rollins and asked her if she would be willing to speak with Mr. Reimer concerning Mr. Gray’s conduct. She agreed to do so, as she was no longer operating as a regulated party in Orange County. II. CONCLUSIONS OF LAW 2. The allegations made by Ms. Rollins and Mrs. Ensminger to the Health Department concerning the behavior of Mr. Gray while acting in his professional capacity as an inspector are credible and were corroborated by independent witnesses. 3. Such conduct on the part of Mr. Gray constitutes unacceptable personal conduct, which is defined by State Personnel Regulation 01J .0604 of Title 25 N.C.A.C. and Section 4.2 of the Orange County Ordinance as that conduct for which, “. . . no reasonable person could, or should, expect to receive prior warnings.” Unacceptable personal conduct constitutes just cause for disciplinary action under the State Personnel Act, § 126-35. 4. The evidence presented on behalf of the Health Department meets the sufficiency standards for just cause to dismiss an employee. 5. Specifically, Respondent has shown that Petitioner was dismissed on the grounds of unacceptable personal conduct in that he was (1) flirtatious with Ms. Rollins, that he asked her out to dinner, that he invited her to go to the beach with him, and that he told her how great she would look in a bathing suit (the sum total of which was characterized by Ms. Rollins and Mrs. Layh as “coming on” to her), and (2) for making inappropriate, sexually oriented remarks to Mrs. Ensminger. Both Ms. Rollins and Mrs. Ensminger were regulated parties of the Health Department at such time. After setting out in detail six reasons why he declined to accept the recommended decision of the AU and the SPC, Reimer affirmed the termination of Gray. Gray thereafter filed a Petition for Judicial Review “in accordance with G.S. 150B, Article 4, and G.S. 126-37,” requesting that the superior court reverse the Director’s Final Decision and affirm the Recommended Decision and Order of AU Sarda as adopted by the SPC with slight modification. He further sought reinstatement to his previous position, or one comparable, as well as costs and attorney fees. On 10 April 1992, the Department moved to dismiss Gray’s petition “pursuant to Rule 12(b)(6) . . . , N.C. Gen. Stat. § 126-37 and N.C. Gen. Stat. § 130A-41,” and for a change of venue pursuant to N.C.R. Civ. P. 12(b)(3) (1990). By order entered 1 October 1992, the superior court reversed Director Reimer’s Final Decision, stating in relevant part: 1. Respondent’s motion to dismiss and for change of venue is denied. 2. The Court finds that the Orange County Health Director abused his discretion and was arbitrary and capricious in his rejection of the Recommended Decision of the State Personnel Commission. 3. The Court hereby adopts and affirms the Findings of Fact of the State Personnel Commission as its own. 4. The Court hereby adopts and affirms the Conclusions of Law and Recommended Decision of the State Personnel Commission and orders Petitioner’s reinstatement and further orders Respondent to pay back pay, benefits, attorney’s fees and costs. 5. The Court, having reviewed the affidavit of time and costs finds the costs of $5,047.33 and attorney fees of $25,000.00 axe reasonable. The Department raises seventeen (17) assignments of error to the trial court’s ruling, but in its appellate brief has condensed these into five (5) arguments. I. The Department first contends the trial court erred by denying its motion to dismiss Gray’s petition for judicial review, alleging the petition failed to meet the specificity requirements of N.C. Gen. Stat. § 150B-46 (1991). We find this contention valid. Under N.C. Gen. Stat. § 150B-43 (1991): Any person who is aggrieved by the final decision in a contested case, and who has exhausted all administrative remedies made available to him by statute or agency rule, is entitled to judicial review of the decision under this Article [Article 4 of Chapter 150B] .... A party seeking judicial review must file a petition in Wake County Superior Court or the superior court of the county wherein the party resides, see N.C. Gen. Stat. § 150B-45 (1991), stating “explicitly . . . what exceptions are taken to the decision or procedure and what relief the petitioner seeks.” G.S. § 150B-46. “Explicit” is defined in this context as “characterized by full clear expression: being without vagueness or ambiguity: leaving nothing implied.” Vann v. North Carolina State Bar, 79 N.C. App. 173, 173-74, 339 S.E.2d 97, 98 (1986) (quoting Webster’s Third New International Dictionary 801 (1968)). In Vann, this Court upheld the trial court’s dismissal of a petition for judicial review on grounds it failed to meet the requirements of G.S. § 150B-46. More particularly, we stated: In his petition, Vann did not except to any finding of fact or conclusions of law, but made only generalized complaints as to certain procedural aspects of the hearing before respondent. . . . [W]e ... conclude that Vann’s petition was not sufficiently explicit to allow effective judicial review of respondent’s proceedings. Vann, 79 N.C. App. at 174, 339 S.E.2d at 98 (emphasis added); but cf. Save Our Rivers, Inc. v. Town of Highlands, 113 N.C. App. 716, 723-24, 440 S.E.2d 334, 339, disc. review allowed, 336 N.C. 609, 447 S.E.2d 402 (1994); O.S. Steel Erectors v. Brooks, Com’r of Labor, 84 N.C. App. 630, 632, 353 S.E.2d 869, 871-72 (1987). Further, although Vann contended in his appellate brief that certain “explicit” allegations had in fact been included in the petition, we declined to accept “[s]uch generalized statements” as adequate to withstand the motion to dismiss. Vann, 79 N.C. App. at 174, 339 S.E.2d at 98. A review of Gray’s 13 March 1992 petition reveals it likewise was not “sufficiently explicit to [have] allow[ed] effective judicial review.” Id. The sole portions touching upon Reimer’s Final Decision are as follows: 8. Respondent has indicated that it will provide a final decision on the Recommended Decision by March 13, 1992 but Petitioner has not received this decision. 9. Petitioner anticipates that the Final Decision will be to deny reinstatement to Petitioner. If the Recommended Decision is to reinstate Petitioner, then this Petition will be dismissed. 10. Petitioner reserves the right to amend this Petition upon receipt of the Final Decision and address any issues included therein. Exceptions to the Decision op Respondent 9. Upon information and belief, Petitioner believes that Respondent will deny him reinstatement and the award of attorney fees. Petitioner excepts to this Decision as being contrary to the Recommended Decision of the Administrative Law Judge and the State Personnel Commission .... Such Decision was arbitrary and capricious. 10. Petitioner shows unto the Court that his Petition meets all the requirements under G.S. 150B, Article 4 . . . . Significantly, the petition lacked even a single exception to particular findings of fact or conclusions of law. Instead, it baldly asserted only that the Department’s decision was “contrary to the Recommended Decision of the Administrative Law Judge and the State Personnel Commission.” In addition, Gray set forth no basis in his petition for alleging that the Final Decision was “arbitrary and capricious,” save perhaps the statement that it contradicted the recommended decisions. Gray maintains, however, that he met the requirements of G.S. § 150B-46 by excepting broadly to “any [d]ecision of Reimer that was [c]ontrary to the Recommended Decision . . . .” Indeed, such a conclusion is mandated, he continues, by the rule that we are to construe liberally statutes allowing for judicial review in order to “preserve and effectuate that right.” See, e.g., James v. Board of Education, 15 N.C. App. 531, 533, 190 S.E.2d 224, 226 (“primary purpose of the statute is to confer the right of review”) (citation omitted), disc. review allowed, 282 N.C. 152, 191 S.E.2d 601, appeal withdrawn, 282 N.C. 672, 194 S.E.2d 151 (1972). Although Gray accurately states the general rule, it may not operate to salvage a petition which utterly disregards the statutory specificity requirements. In the case sub judice, the Director’s decision consisted of thirty (30) pages, containing eighty-one (81) findings of fact, twelve (12) conclusions of law, and six (6) carefully
REO v LANE BRYANT, INC Docket No. 166515. Submitted February 7, 1995, at Grand Rapids. Decided June 6, 1995, at 9:00 a.m. Kelley A. Reo petitioned the Kalamazoo Circuit Court for judicial review of the Department of Labor’s dismissal of her claim that Lane Bryant, Inc., her employer, violated the wages and fringe benefits act, MCL 408.471 et seq.; MSA 17.277(1) et seq., by discharging her for disclosing her wages. The department had determined that the claim was not timely under MCL 408.483(2); MSA 17.277(13X2) because it had not been filed within thirty days of the discharge. The court, William G. Schma, J., agreeing with the department, granted Lane Bryant’s motion to dismiss the petition for review. The petitioner appealed. The Court of Appeals held: The petitioner’s claim is not subject to MCL 408.483(2); MSA 17.277(13X2) because the claim is not for discharge in retaliation for asserting, on behalf of another, a right afforded under the wages and fringe benefits act. The claim is for a violation of MCL 408.483a(c); MSA 27.277(13a)(c), which prohibits an employer from discharging, formally disciplining, or otherwise discriminating against an employee who discloses the amount of the employee’s own wages. A violation of § 13a, as well as any other section of the wages and fringe benefits act, except for § 13, is subject to the one-year filing requirement of MCL 408.481; MSA 17.277(11). Reversed and remanded for further proceedings. Master and Servant — Wages and Fringe Benefits Act — Discharge for Disclosure of Wages. The wages and fringe benefits act prohibits an employer from discharging, formally disciplining, or otherwise discriminating against an employee who discloses the amount of the employee’s own wages; a complaint alleging a violation of the prohibition may be filed with the Department of Labor within twelve months after the alleged violation (MCL 408.481, 408.483a(c); MSA 17.277[11], 17.277[13a][c]). References Am Jur 2d, Labor and Labor Relations § 656. See ALR Index under Labor and Employment. John T. Burhans, for Kelley A. Reno. Gemrich, Moser, Bowser, Fette & Lohrman (by Mary E. Delahanty) (Vorys, Sater, Seymour & Pease by Douglas L. Williams and Susan A. Cohen, of Counsel), for Lane Bryant, Inc. Before: Murphy, P.J., and Mackenzie and Hoekstra, JJ. Per Curiam. Petitioner Kelly A. Reo appeals from a circuit court order that granted a motion by respondent Lane Bryant, Inc., for dismissal of petitioner’s petition for judicial review. We reverse. Petitioner had filed a claim with the Michigan Department of Labor alleging that she had been fired in violation of MCL 408.483a; MSA 17.277(13a) more than three months earlier for disclosing her wages. The Department of Labor eventually issued a determination order dismissing petitioner’s claim because of her failure to file the claim within thirty days of the violation, as required by MCL 408.483(2); MSA 17.277(13X2). Petitioner’s petition for review in the circuit court was dismissed after the circuit court agreed that petitioner’s delay in filing her claim precluded her from seeking relief.___ We believe the circuit court and the Department of Labor incorrectly interpreted the statutes at issue. While this Court is generally required to give great weight to any reasonable construction of a statute adopted by the agency charged with its enforcement, In re Quality of Service Standards for Regulated Telecommunication Services, 204 Mich App 607, 612; 516 NW2d 142 (1994), the agency’s interpretation cannot be used to overcome a statute’s plain meaning. Ludington Service Corp v Acting Comm’r of Ins, 444 Mich 481, 505; 511 NW2d 661 (1994). Additionally, statutes granting power to administrative agencies. must be strictly construed. In re Public Service Commission’s Determination Regarding Coin-Operated Telephones, Direct-Inward Dialing, and Touchtone Service, No 2, 204 Mich App 350, 353; 514 NW2d 775 (1994). Because the thirty-day filing requirement contained in § 13(2) applies only to violations of § 13, the circuit court and the Department of Labor erred in applying that requirement to petitioner’s claim under § 13a, an entirely different section of the wages and fringe benefits act, MCL 408.471 et seq.; MSA 17.277(1) et seq. The circuit court further erred in concluding that petitioner was exercising a right afforded by the act and in analyzing petitioner’s claim under § 13(1). Section 13(1) is inapplicable to petitioner’s claim because petitioner was not fired for filing a complaint, instituting a proceeding under the act, testifying in a proceeding, or exercising a right on behalf of another, the only situations to which § 13 is applicable. MCL 408.483(1); MSA 17.277(13X1)-provides, in pertinent part: An employer shall not discharge an employee or discriminate against an employee because the employee filed a complaint, instituted or caused to be instituted, a proceeding under or regulated by this act, testified or is about to testify in a proceeding, or because of the exercise by the employee on behalf of an employee or others of a right afforded by this act. [Emphasis added.] We believe that in order to fall within the plain meaning of the above provision an employee must be exercising a right afforded by the act on behalf of another employee or other person. Simply exercising a right on one’s own behalf would not bring an employee within the purview of § 13. Here, petitioner’s claim is clearly addressed by § 13a(c), which prohibits an employer from "discharging], formally disciplining], or otherwise discriminating] against for job advancement an employee who discloses his or her wages.” Accordingly, we conclude that petitioner was entitled to file her claim with the Department of Labor within one year of the alleged violation, as permitted by MCL 408.481; MSA 17.277(11), which provides a twelve-month filing period for violations of all sections of the act with the exception of § 13(2). Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction. _ Petitioner also argues on appeal that the circuit court had jurisdiction to hear the case despite her failure to exhaust administrative remedies. Although not explicitly decided by the circuit court, because the circuit court impliedly decided this issue in petitioner’s favor, she is not the proper party to raise this issue on appeal, and respondent has not filed a cross appeal. See Burke v Gaukler Storage Co, 13 Mich App 536; 164 NW2d 691 (1968). In any event, exhaustion of administrative remedies is not an inflexible condition precedent to judicial consideration. Int’l Business Machines Corp v Dep’t of Treasury, 75 Mich App 604, 608-610; 255 NW2d 702 (1977). Because it appears that the trial court could have granted petitioner leave for judicial review, any error in failing tó explicitly do so is harmless. Id. We note that § 13a was added to the wages and fringe benefits act in 1982 and became effective in 1983, while all other sections of the act took effect in 1978. We recognize that an earlier panel of this Court has interpreted § 13 differently. In Cockels v Int’l Business Expositions, Inc, 159 Mich App 30; 406 NW2d 465 (1987), a panel of this Court interpreted § 13 to apply to a situation in which an employee was exercising a right afforded by the act on her own behalf. We believe that interpretation to be incorrect. We recognize that our construction of the act may result in a civil fine being the only remedy available under the act if petitioner’s claim is proved on remand, because the remedies provided in MCL 408.488(1), (2), and (3); MSA 17.277(18X1), (2), and (3) apply only to violations of §§ 2 through 8. While we are cognizant of this result, we are without authority to change it, given our interpretation of the statutes and the Legislature’s failure to provide explicit remedies for violations of § 13a. Furthermore, because the Department of Labor has never even ruled on the merits of petitioner’s claim, a discussion of available remedies at this point would be premature.
FOEHR v REPUBLIC AUTOMOTIVE PARTS, INC Docket No. 147787. Submitted March 23, 1995, at Detroit. Decided May 30, 1995; approved for publication August 17, 1995, at 9:00 A.M. Donald L. Foehr brought a wrongful discharge action in the Macomb Circuit Court against Republic Automotive Parts, Inc., alleging that termination of employment was contrary to a legitimate expectation of termination for just cause only and constituted impermissible age discrimination under the Civil Rights Act, MCL 37.2202(l)(a); MSA 3.548(202)(l)(a). The court, George E. Montgomery, J., summarily dismissed the age discrimination claim, but entered judgment on a jury verdict awarding past and future damages for the claim of employment terminable for just cause only. The defendant appealed, and the plaintiff cross appealed. The Court of Appeals held: 1. The trial court did not err in denying the defendant’s motion for judgment notwithstanding the verdict. The plaintiff presented sufficient evidence, based on a legitimate expectations theory, that, as a corporate officer, he was subject to the policies expressed in the defendant’s employment policy manual and that the manual created employment that was terminable for just cause only. The policy manual also supported the plaintiff’s theory that, even if he was removed as an officer of the corporation, he had a legitimate expectation that he would be placed in another position for which he was qualified if any were available. 2. The trial court did not err in denying the defendant’s motion for a new trial with regard to future damages. The adequacy of the plaintiff’s efforts at mitigating damages by obtaining other employment after discharge and testimony about bonuses and raises the plaintiff would have received had he remained employed by the defendant were properly considered by the jury in deciding future damages. 3. The trial court did not err in instructing the jury about the plaintiff’s legitimate expectation of employment terminable for just cause only, in reading SJI2d 110.05 and 110.07 to the jury, in refusing to instruct the jury about Delaware law in the absence of reasonable notice thereof to the plaintiff, and in reading SJI2d 53.03 to the jury regarding the reduction of future damages to present value. 4. The trial court did not abuse its discretion in not allowing the defendant to present evidence of its revised employment policy manual and its corporate bylaws. The revisions were made after the plaintiffs discharge, rendering them irrelevant to the plaintiff’s claim, and cannot constitute effective unilateral policy changes in the absence of reasonable notice to the plaintiff, good faith, and economic necessity. The bylaws were of questionable relevance and were not made available to the plaintiff until after discovery had closed despite a request for them during discovery. The trial court did not abuse its discretion in excluding as irrelevant and cumulative the testimony of one witness and in allowing the testimony of another witness as rebuttal concerning mitigation of damages. 5. The trial court erred in granting summary disposition of the claim of age discrimination. The plaintiff presented a prima facie case of age discrimination by showing that he was qualified for the position from which he was discharged and that there was a pattern of discharging older employees and replacing them with younger ones. Because the plaintiff claimed damages for discrimination that were not reflected in the verdict, the case must be remanded for further proceedings regarding the age discrimination claim. Affirmed in part, reversed in part, and remanded. Stark & Gordon, P.C. (by Deborah L. Gordon) (Bendure & Thomas, by Mark R. Bendure, of Counsel), for the plaintiff. Vandeveer Garzia, P.C. (by Robert D. Brignall, C.F. Boyle, Jr., and Hal O. Carroll), for the defendant. Before: Connor, P.J., and Wahls and Hoekstra, JJ. Per Curiam. In this wrongful discharge action, the jury found for plaintiff. He was awarded past damages of $262,413 and future damages of $692,603. Defendant appeals as of right from the final judgment. Plaintiff has also filed a cross appeal. We affirm the jury’s verdict, but reverse the trial court’s decision to grant defendant summary disposition of plaintiffs claim of age discrimination. Defendant first claims error in the trial court’s decision to deny its motion for judgment notwithstanding the verdict. We disagree. Plaintiff presented sufficient evidence, based upon a legitimate expectations theory, that he was subject to the policies expressed in defendant’s employment policy manual and that the manual created an employment contract that was terminable for just cause only. There was evidence that the policy manual applied to all employees who received a wage or salary from defendant. Officers of the corporation were not excluded. Therefore, it was a jury question whether the policy manual applied to plaintiff and whether it created a legitimate expectation that the employer would discharge employees for just cause only. Rood v General Dynamics Corp, 444 Mich 107, 117-118, 140-141; 507 NW2d 591 (1993); Rice v ISI Mfg, Inc, 207 Mich App 634, 636; 525 NW2d 533 (1994). The policy manual also supported plaintiffs theory that, even if he was removed as an officer of the corporation, he had a legitimate expectation that he would be placed in another position in the company unless a position for which he was qualified was not available. It had been defendant’s practice over the years when jobs were eliminated to permit displaced employees to accept new assignments within the corporation. Accordingly, even though his term as a corporate officer was subject to an annual vote by the board, his wrongful discharge action was adequately supported by the evidence and the trial court did not err in submitting his case to the jury. Rood, supra; Barnell v Taubman Co, Inc, 203 Mich App 110, 116; 512 NW2d 13 (1993), lv gtd 447 Mich 990 (1994). Furthermore, we do not agree with defendant that plaintiff’s employment involved nothing more than a satisfaction contract. Mitchell v General Motors Acceptance Corp, 176 Mich App 23, 32; 439 NW2d 261 (1989). When the language of defendant’s policy manual is read in a light most favorable to plaintiff, he had a reasonable, legitimate expectation that he would not have his employment terminated except for just cause. What constituted just cause was not left to defendant to decide. Compare Thomas v John Deere Corp, 205 Mich App 91, 94-95; 517 NW2d 265 (1994). Plaintiff was not required to produce evidence of mutual assent to have his case reach the jury. He premised his wrongful discharge action on a public policy theory rather than a contract theory. Rood, supra, pp 117-119; Barnell, supra, pp 116, 119. The jury’s verdict was not against the great weight of the evidence. Bosak v Hutchinson, 422 Mich 712, 737; 375 NW2d 333 (1985). First, as we have previously discussed, the jury could have found that plaintiff was entitled to continued employment even if defendant’s new chief executive officer wanted to bring in his own people to serve as officers. Second, the jury could have found that defendant’s reasons for terminating plaintiff’s employment were a pretext. The decision was apparently made with little or no regard for plaintiff’s demonstrably excellent record, and plaintiff testified that he was told that his performance was not a reason for his termination. The trial court did not err in denying the motion for a new trial with regard to future damages. Plaintiff presented evidence that he mitigated his damages, but was not able to either find a comparable permanent position or earn the same pay when working as an independent financial consultant. Renny v Port Huron Hosp, 427 Mich 415, 438-439; 398 NW2d 327 (1986); Kocenda v Arch diocese of Detroit, 204 Mich App 659, 665; 516 NW2d 132 (1994). It was also for the jury to decide if plaintiff was subsequently fired from another job for incompetence. The jury’s award was supported by the evidence. Rice, supra, p 638. Testimony about possible bonuses or raises that plaintiff might have received in the future was not speculative and was properly admitted. The evidence was based upon defendant’s past practices of awarding bonuses and merit increases. Moreover, plaintiff was also entitled to have the jury consider an award of future damages beyond one year. As discussed previously, the jury heard evidence that plaintiff could have reasonably expected to remain employed with defendant beyond one year even if he was removed from his position as a corporate officer. Rice, supra. We also find no error with the jury instructions given in this case. First, no error can be predicated upon the Supreme Court’s decision in Rowe v Montgomery Ward & Co, Inc, 437 Mich 627; 473 NW2d 268 (1991). That decision involves oral contracts for job security. Plaintiff’s theory was primarily dependent upon the policy manual and defendant’s practices. The instructions were consistent with substantial justice and do not warrant reversal. McLemore v Detroit Receiving Hosp, 196 Mich App 391, 399; 493 NW2d 441 (1992). The trial court instructed the jury consistent with SJI2d 110.05 and 110.07. Defendant has not delineated any error in regard to these instructions. Nor has defendant demonstrated why the court’s decision not to give defendant’s proposed instructions was error. Defendant has failed to provide this Court with a copy of the transcript of the closing arguments. Consequently, we are unable to determine that the standard jury instrucr tions were inadequate to address the theories in this case. Admiral Ins Co v Columbia Casualty Ins Co, 194 Mich App 300, 305; 486 NW2d 351 (1992). We find no error requiring reversal regarding the instructions addressing employment terminable at will and satisfaction contracts. Although the trial court relied upon a "reasonableness” standard for satisfaction contracts, when "good faith” is the test, the difference in these terms is insignificant and does not require reversal. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 622-623; 292 NW2d 880 (1980); Schmand v Jandorf, 175 Mich 88, 95-96; 140 NW 996 (1913); McLemore, supra, pp 400-401; SJI2d 110.11. The verdict form used did not foreclose the jury from considering the defense theories that plaintiff’s employment was at-will or pursuant to a satisfaction contract. The form was not intended to take the place of the jury instructions and it simply required the jury to indicate if plaintiff had met his burden. The court properly refused to instruct regarding Delaware law because that subject was not raised until the parties were discussing the proposed jury instructions. Pursuant to MCL 600.2114a; MSA 27A.2114(1), the trial court had the authority to refuse to instruct regarding Delaware law because reasonable notice was not provided to plaintiff. Furthermore, defendant’s proposed instruction would have offered little help, if any, to the jury. The trial court properly relied on SJI2d 53.03 to reduce the future damages to present value. This Court has applied SJI2d 53.03 to employment claims, including wrongful discharge actions. Howard v Canteen Corp, 192 Mich App 427, 441; 481 NW2d 718 (1992); Goins v Ford Motor Co, 131 Mich App 185, 201; 347 NW2d 184 (1983). The use of the five percent rate also did not deny defendant due process. Verbison v Auto Club Ins Ass’n, 201 Mich App 635, 638; 506 NW2d 920 (1993); Klco v Dynamic Training Corp, 192 Mich App 39, 42; 480 NW2d 596 (1991). Defendant contends that the trial court abused its discretion in various evidentiary rulings made. We review the trial court’s decision to admit evidence for an abuse of discretion. Wolff v Automobile Club of Michigan, 194 Mich App 6, 14; 486 NW2d 75 (1992). Defendant first argues that the trial court erred in excluding evidence of its revised personnel manual. The manual was revised after plaintiff’s employment was terminated. Nonetheless, defendant maintains that the evidence was relevant with regard to the issue of damages because, in light of the revised policies, plaintiff did not have a legitimate expectation of continued future employment. We disagree. In order for an employer’s unilateral policy changes to become legally effective, reasonable notice must be provided to the affected employees. In re Certified Question, 432 Mich 438, 457; 443 NW2d 112 (1989). In this instance the employment relationship between the parties had terminated before the adoption of the revised manual. Therefore, plaintiff did not have notice of the change, nor did he accept the revised terms. Id., pp 446-447, 450. Furthermore, there was no showing by defendant that the policy changes were made in good faith or were economically necessary. Cf. Neubacher v Globe Furniture Rentals, Inc, 205 Mich App 418; 522 NW2d 335 (1994). The trial court did not abuse its discretion in refusing to admit this evidence. The evidence was not relevant to plaintiff’s claim for future damages. An employer cannot be permitted to rely on posttermination changes in its policies without good reason, such as economic necessity. Id. Otherwise, an employer could change its policies specifically to avoid having to pay future damages. The trial court also did not abuse its discretion in refusing to admit into evidence defendant’s corporate bylaws. Defendant waited until after discovery was closed to produce the bylaws although they were requested during discovery. Defendant properly was barred from using the bylaws at trial in order to support a new theory of which plaintiff was previously unaware. Barlow v John Crane-Houdaille, Inc, 191 Mich App 244, 251; 477 NW2d 133 (1991). Finally, the actual bylaws were of questionable relevance because they pertained only to the removal of officers, which plaintiff did not dispute. Moreover, other evidence regarding the content of the bylaws was admitted at trial. The trial court did not abuse its discretion in excluding the testimony of Thomas Orsi. Wolff, supra, p 14. His testimony was both irrelevant and cumulative. Defendant also cites as error the trial court’s decision to allow William Wright to testify on rebuttal. We find no abuse of discretion. Winiemko v Valenti, 203 Mich App 411, 418; 513 NW2d 181 (1994). Wright’s testimony was clearly within the area of rebuttal evidence because it was offered to address the affirmative defense of whether plaintiff had mitigated his damages. Rasheed v Chrysler Corp, 445 Mich 109, 120-123; 517 NW2d 19 (1994); Sullivan Industries, Inc v Double Seal Glass Co, Inc, 192 Mich App 333, 348; 480 NW2d 623 (1991). Furthermore, plaintiff relied upon defense counsel’s statements that Wright would be called by defendant. We therefore find no abuse of discretion by the trial court in allowing Wright to testify on rebuttal. Plaintiff’s only issue in his cross appeal concerns summary disposition of his age discrimination claim pursuant to MCL 37.2202(l)(a); MSA 3.548(202)(l)(a). The trial court addressed the motion under both MCR 2.116(C)(8) and (10). However, because the court went beyond the pleadings in deciding the motion, the motion appears to have been granted under MCR 2.116(0(10), no genuine issue of material fact. Kreager v State Farm Mutual Automobile Ins Co, 197 Mich App 577, 579; 496 NW2d 346 (1992). The trial court correctly determined that plaintiff was required to show that age was a significant factor in the firing decision, not a determining factor, to establish a prima facie case of age discrimination. Matras v Amoco Oil Co, 424 Mich 675, 684; 385 NW2d 586 (1986). Defendant did not terminate plaintiff’s employment for economic reasons. Plaintiff, therefore, did not have to meet the higher burden of proof. Id.; Wolff, supra, p 11. We agree with plaintiff that the trial court erred in ruling that he did not present a prima facie case of intentional age discrimination. Plaintiff was qualified for the position. He produced evidence that showed there was a pattern of discharges of older employees. Those positions were then filled by younger employees. Most of the individuals who remained employees of defendant were in their thirties or forties. Plaintiff was fifty-five years old when his employment was terminated. His position was subsequently filled by a man who was forty-four years old. Thus, he established a prima facie case of age discrimination. Lytle v Malady, 209 Mich App 179, 185; 530 NW2d 135 (1995); Barnell, supra, p 120. Furthermore, whether defendant’s legitimate, nondiscriminatory reasons for the discharge were a pretext was a question of fact. Because plaintiff claimed additional damages for his discrimination claim that were not reflected in the wrongful discharge verdict, we remand this matter for further proceedings regarding the discrimination claim. See Phillips v Butterball Farms Co, Inc (After Second Remand), 448 Mich 239, 250, n 30; 531 NW2d 144 (1995); Howard, supra, p 435. Affirmed with respect to the jury’s verdict concerning wrongful discharge, but reversed and remanded for further proceedings with respect to the trial court’s decision to grant summary disposition of plaintiffs age discrimination claim. We do not retain jurisdiction.
Showing 6,551–6,600 of 6,866 rulings · Page 132 of 138
Browse Other Claim Types
Explore rulings by type of employment law claim.
Think you may have a wrongful termination claim?
Check which employment laws may protect you — free, private, and no sign-up required.
Data sourced from public federal court records via CourtListener.com. Case outcomes extracted using AI analysis. This information is for educational purposes only and does not constitute legal advice. The classification of claim types is based on automated analysis and may not reflect the full scope of each case.