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Claim Type

Wrongful Termination Cases

6,866 employment law court rulings from public federal records (18632026)

6,866
Total Rulings
23%
Plaintiff Win Rate
$1,340,684
Avg Damages (488 cases)
S.D.N.Y.
Top Court

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

Defendant Win
3045 (44%)
Plaintiff Win
1585 (23%)
Mixed Result
1115 (16%)
Remanded
569 (8%)
Dismissed
460 (7%)
Settlement
91 (1%)
Other
1 (0%)

Top Employers in Wrongful Termination Cases

Employers most frequently appearing in wrongful termination rulings.

Court Rulings (6,866)

Willitts v. Roman Catholic Archbishop
8825Nov 18, 1991Massachusetts

Leslee A. Willitts vs. Roman Catholic Archbishop of Boston & another. Middlesex. September 9, 1991. November 18, 1991. Present: Liacos, C.J.. Nolan, O’Connor, & Greaney, JJ. Contract, Employment, Construction of contract, Termination. Employment, Termination. Public Policy. Civil Rights, Termination of employment, Coercion. A school teacher’s written contract of employment, covering a one-year school term and explicitly stating its expiration date, was not automatically renewed for a subsequent term by the school’s failure to follow its written policy, incorporated in the contract by reference, that, in the event of a contract not being renewed, the teacher “should be formally notified of [the] decision by April 15.” [206-208] Where a form of contract for a teacher’s employment at a religious school, consistent with the employer’s written policies incorporated in the contract by reference, contained signature lines for both the principal of the school and the pastor of the parish with which the school was affiliated, the pastor’s signature alone was not sufficient to create a binding contract. [208-209] An employer’s decision not to renew a contract providing a definite period of employment, allegedly in consequence of the employee’s attempt to form an association of her follow employees, was not actionable as a discharge for reasons contrary to public policy. [209-210] A nonprofit school’s decision not to renew a school teacher’s contract providing a definite period of employment, allegedly in consequence of the teacher’s attempt to form an association of her follow teachers, did not constitute “threats, intimidation, or coercion” intefering with her exercise of free speech or association rights, so as to be actionable under the State Civil Rights Act, G. L. c. 12, § 11H. [210-211] Civil action commenced in the Superior Court Department on November 30, 1988. The case was heard by David M. Roseman, J., on a motion for summary judgment. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. James F. Lamond for the plaintiff. Richard W. Murphy (Thomas J. Hobin, Jr., & Jon R. Maddox with him) for the defendants. St. Tarcisius School. Greaney, J. The plaintiff, Leslee A. Willitts, brought this action in the Superior Court against the defendants, the Roman Catholic Archbishop of Boston and St. Tarcisius School (school), claiming that the school had unlawfully terminated her employment. Her complaint sought declaratory relief under G. L. c. 231A (1990 ed.), and damages on the basis of alleged breach of contract, termination of employment in disregard of public policy, and violation of the State Civil Rights Act, G. L. c. 12, § 111 (1990 ed.). Both the plaintiff and the defendants moved for summary judgment pursuant to Mass. R. Civ. P. 56 (a) and (b), 365 Mass. 824 (1974). A judge of the Superior Court allowed the defendants’ motion, and judgment entered for the defendants. The plaintiff appealed. We transferred the case to this court on our own motion. We affirm the judgment of the Superior Court. Summary judgment “shall be rendered . . . [if] there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law.” Community Nat’l Bank v. Dawes, 369 Mass. 550, 553 (1976). In setting out the facts from the documents, affidavits and depositions in the record, we resolve any conflicts in the summary judgment materials, and we make all logically permissible inferences, in the plaintiff’s favor. Coveney v. President & Trustees of the College of the Holy Cross, 388 Mass. 16, 17 (1983). St. Tarcisius School is an elementary school affiliated with Saint Tarcisius Church of Framingham, a Roman Catholic church, The plaintiff worked there as a kindergarten teacher from September, 1980, until June, 1987. Her employment was governed by yearly written contracts, each covering one school-year term. Each contract set forth the terms of employment for the upcoming school year, including beginning and ending dates, and contained signature lines for the teacher, the principal of the school, and the parish pastor. The contract incorporated by reference the “Regulations and directives of the Archdiocese Department of Education,” from the Policy Book for Catholic Schools (Directives), a guide to the administration of parish schools published by the archdiocese of Boston. The school’s practice for renewing the contracts of its teaching staff was to conduct a yearly performance review in the spring and at that time to present the teacher with a contract for the upcoming school year. In keeping with this procedure, the plaintiff met with the principal of the school, Sister Rita Welch, on March 31, 1987, to receive her annual performance review and her contract for the 1987-1988 school year. Her performance review was uniformly positive. During the meeting, she signed the contract, which had already been signed by Father Alfred Almonte, the pastor of the church, and returned it to Sister Welch. The plaintiff mentioned to Sister Welch that she had applied for a teaching position in the Framingham public schools, but had not received an offer as of that time and was therefore not pursuing any other positions. In response to this disclosure, Sister Welch said that she could not sign the contract under the circumstances and told the plaintiff that she had until May 31 to decide whether or not to return to the school. The plaintiff told Sister Welch that she had already decided to stay at St. Tarcisius, and she left the meeting with the understanding that she would meet again with Sister Welch before May 31 to reaffirm her intention to remain at St. Tarcisius for the next school year. While employed at St. Tarcisius, the plaintiff had attended meetings of the Boston Archdiocesan Teachers’ Association, which represented teachers at some of the archdiocesan high schools in collective bargaining. She became interested in forming a teachers’ association at her school in order to address issues of concern to the faculty there. On May 22, 1987, she posted a notice in the teachers’ lounge- at the school, calling for a meeting of the teachers to discuss various matters, including collective bargaining. The notice included statements from authorities in the Roman Catholic Church in support of the rights of workers to organize and to bargain collectively. On the same date, the plaintiff distributed a memorandum to the teachers announcing the date and time of the meeting and stating as its objective “the airing of views, ideas and concerns” toward the end of “establishing direction towards a ‘just’ teaching atmosphere.” After learning of the notice that the plaintiff had posted in the teachers’ lounge, Sister Welch and Father Almonte called a meeting of all the teachers on May 29, 1987, to discuss it. At that meeting, Father Almonte referred to problems that another school was experiencing because of union organization, and he declined Willitts’ offer to arrange a meeting with a group of concerned teachers. In response to the plaintiff’s comment that there were “discrepancies” in the working conditions at the school which in her opinion should be dealt with, Father Almonte said that her proposed topics of discussion all involved money, and that the school was at its financial limit. He told the teachers that if they were unhappy at the school, they should leave. He offered to release any teacher who wished to go, and he gave the teachers one week to reach a decision. At the end of the meeting, the plaintiff told Sister Welch that since she had already signed her contract for the forthcoming school year, she had already made up her mind. Sister Welch informed her that she (Welch) would not sign the contract “under these conditions.” At a subsequent meeting on June 8, 1987, Sister Welch criticized the plaintiff for her attempt to organize the teachers. She offered to renew the plaintiff’s contract, but only on the condition that the plaintiff refrain from such efforts in the future. When the plaintiff refused to agree to that condition, Sister Welch, on behalf of the school, declined to renew her contract, which expired by its terms on June 30, 1987. Following the school’s decision, the plaintiff requested both the National Labor Relations Board (board) and the Massachusetts Labor Relations Commission (commission) to pursue an unfair labor practice charge on her behalf. The board declined to do so on tiie ground that it lacked jurisdiction over the school. The commission also dismissed the plaintiff’s claim on the ground that, as a professional employee of a nonprofit institution, she was not covered by G. L. c. 150A, § 2, which protects the rights of workers to organize and to - bargain collectively. No appeal was taken by the plaintiff from either of these decisions and her complaint to the Superior Court followed. 1. Breach of contract.* The plaintiff advances two theories in support of her contention that, despite Sister Welch’s refusal to sign the contract, she held a valid employment contract for- the 1987-1988 school year. She first argues that her contract with the school for 1986-1987 was automatically renewed for the following year by the school’s failure to follow its own provisions for the notification of teachers whose contracts are not to be renewed. Section 4420(3) of the Directives, which are incorporated by reference into the school’s contracts with its teachers, specifies that “[t]he teacher should be informed prior to February 15 that because of unsatisfactory performance, there is a possibility that the contract might not be renewed. The teachers should be formally notified of a decision prior to April 15, so that opportunities to seek other employment will not be lost.” Relying on this provision, the plaintiff argues that the school’s failure to follow its own notice provisions resulted in the automatic renewal of her contract for the following school year, and that the school committed a breach of this contract by terminating her employment. We reject this claim. First, neither the contract itself nor the Directives state that failure by the school to follow the provisions of § 4420(2) results in automatic renewal of a teacher’s contract. Furthermore, the word “should,” as used in that provision of the Directives, is merely advisory rather than mandatory language; its purpose is to facilitate whenever possible the employment search of a teacher whose contract the school does not intend to renew. To interpret this provision of the Directives as the plaintiff does would render the school powerless to avoid rehiring a teacher where the basis for the decision not to rehire arose, as it did in this case, after April 15. Such an interpretation would contradict the letter of the contract, which contained definite beginning and ending dates, and which stated “[tjhis agreement expires on June 30, 1987 unless definitely renewed.” “The intent of the parties must be gathered from a fair construction of the contract as a whole and not by special emphasis upon any one part.” Crimmins & Peirce Co. v. Kidder Peabody Acceptance Corp., 282 Mass. 367, 375 (1933). Ucello v. Cosentino, 354 Mass. 48, 51 (1968). Lydon v. Allstate Ins. Co., 5 Mass. App. Ct. 771 (1977). We therefore reject the plaintiff’s argument that a contract was formed automatically when, on April 15, the school failed to notify the plaintiff that her contract was not to be renewed. “Expectations and negotiations fall far short of a binding agreement.” Brighton Packing Co. v. Butchers’ Slaughtering & Melting Ass’n, 211 Mass. 398, 405 (1912). Phoenix Spring Beverage Co. v. Harvard Brewing Co., 312 Mass. 501, 506 (1942), and cases cited. The plaintiff argues in the alternative that a binding agreement was formed on the date of her performance review, when she signed the contract that had previously been signed by Father Almonte. Although Sister Welch had not yet signed the contract, her signature was not required, the plaintiff claims, because only the parish pastor had authority to enter contracts with the teachers. Relying on § 4120 of the Directives, which states that “the final contracting of the teacher should be the responsibility of the pastor who may delegate this responsibility to the principal,” the plaintiff argues that nothing in the record indicates that Father Almonte had in fact delegated this responsibility, and so his signature alone was sufficient to bind the school. We disagree. The contract contains a signature line for the principal, and all previous contracts between the parties contained her signature, in keeping with § 2200 of the Directives which designates the principal as “the administrative head of the school.” “Effect is to be given if possible to every word of an instrument and to every signature upon it.” Gloucester Mut. Fishing Ins. Co. v. Boyer, 294 Mass. 35, 39 (1936). Summary judgment was properly granted in favor of the defendants on the plaintiffs claim of breach of contract. 2. Termination in violation of public policy. The plaintiff argues that, even if the school was not contractually bound to employ her for the 1987-1988 term, it nevertheless was prohibited from terminating her employment for reasons that violate public policy. See DeRose v. Putnam Management Co., 398 Mass. 205, 210 (1986); Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., 404 Mass. 145, 149-151 (1989); Flesner v. Technical Communications Corp., 410 Mass. 805, 810-812 (1991). The common law doctrine granting an employee a cause of action for wrongful discharge, if the reason for the discharge is contrary to public policy, is limited to at-will employees. Because the plaintiffs employment contract contained a definite period of employment, she was not an employee at will. See Jackson v. Action for Boston Community Dev. Inc., 403 Mass. 8, 9 (1988), and cases cited. And because she was not an employee at will, the school’s decision not to renew her contract did not constitute termination actionable under the public policy exception stated in the DeRose decision, supra. The plaintiff would extend that exception to employees under contract for a term; we decline to do so. The school’s decision not to reappoint the plaintiff was simply a determination, within its complete discretion, to discontinue a relationship that had expired by the terms of the contract, and is not conduct actionable under the public policy exception to the at-will employment doctrine. Summary judgment was properly granted for the defendants on this claim. 3. State Civil Rights Act claim. The plaintiffs final claim is that the school’s action, in ending her employment amounted to “threats, intimidation, or coercion” interfering with her rights to free speech and association in violation of G. L. c. 12, § 11I, the State Civil Rights Act. We do not agree. That act provides a remedy when “any person or persons, whether or not acting under color of law, interfere by threats, intimidation or coercion, or attempt to interfere by threats, intimidation or coercion, with the exercise or enjoyment by any other person or persons of rights secured by the constitution or laws of the commonwealth.” G. L. c. 12, § 11H (1990 ed.) (incorporated into G. L. c. 12, § 11I). As noted in Bally v. Northeastern Univ., 403 Mass. 713, 719-720 (1989), relief under the Act may be granted where the “threat, intimidation or coercion” involves either a physical confrontation accompanied by a threat of harm, see Batchelder v. Allied Stores Corp., 393 Mass. 819, 823 (1985); Bell v. Mazza, 394 Mass. 176, 183-184 (1985); O’Connell v. Chasdi, 400 Mass. 686, 687-688 (1987), or the loss of a contract right, see Redgrave v. Boston Symphony Orchestra, Inc., 399 Mass. 93, 95 (1987). Because the plaintiff did not have a contract for the 1987-1988 school year, the violation of the Act she alleges consists only in the defendant’s failure to renew its contract with her. Such action by the school falls outside the scope of what we recognize as “threats, intimidation or coercion” required to state a claim under the Act. In declining to continue the plaintiffs contract, the school exercised its discretion under the terms of employment it chose to offer its teachers. There was no improper interference by the defendant with a secured right. Summary judgment was therefore properly granted for the defendants on this claim. See Hobson v. McLean Hosp. Corp., 402 Mass. 413, 417-418 (1988). Korb v. Raytheon Corp., 410 Mass. 581, 585 (1991). Flesner v. Technical Communications Corp., supra at 818-819. Judgment affirmed. There is no indication in the record that the meeting the plaintiff proposed was ever held. Citing NLRB v. Catholic Bishop of Chicago, 440 U.S. 490 (1979), the board concluded, among other things, that because “St. Tarcisius School is a Catholic School whose purpose and function in substantial part is to propagate a religious faith and whose primary purpose is the religious education of students,” the board lacked jurisdiction over the school. In reaching the merits of the plaintiffs claims, we reject the school’s argument that the claims are beyond the subject matter jurisdiction of the civil courts because the issues raised involve “ ‘matters of discipline, faith, internal organization, or ecclesiastical rule, custom, or law,’ ” see Madsen v. Erwin, 395 Mass. 715, 723 (1985), quoting Serbian E. Orthodox Diocese v. Milivojevich, 426 U.S. 696, 713 (1976). We conclude, as did the judge, that the plaintiffs claims deal with secular matters, founded on the interpretation of constitutional, common and statutory law, and thus fall within the jurisdiction of the courts to determine. To the extent that the cases cited by the plaintiff in support of this argument rely on G. L. c. 71, §41 (1990 ed.), they are inapposite, since that statute, which provides for automatic renewal of the appointments of certain public school teachers where notification requirements are not met, is inapplicable to a contract between private parties of the type involved in this case. Black’s Law Dictionary 1379 (6th ed. 1990), defines the word “should” as follows: “The past tense of shall; ordinarily implying duty or obligation; although usually no more than an obligation of propriety or expediency, or a moral obligation, thereby distinguishing it from ‘ought.’ It is not normally synonymous with ‘may,’ and although often interchangeable with the word ‘would,’ it does not ordinarily express certainty as ‘will’ sometimes does.” The school also argues that § 4420(2) of the Directives is inapplicable in this case because it applies only to the nonrenewal of contracts on the ground of “unsatisfactory performance,” and there is no dispute that the plaintiff performed her teaching duties in a satisfactory manner. Because we reject the plaintiff’s argument on other grounds, we need not decide whether her union organization efforts could properly be categorized as “unsatisfactory performance.” Moreover, the conduct of the parties shows that neither treated the contract as automatically renewed on April 15. The plaintiff informed Sister Welch on May 29 of her intention to remain at the school, and at their meeting on June 8, Sister Welch extended a conditional offer of employment, which the plaintiff rejected. The plaintiff" cites to no authority in support of her argument that the public policy exception should apply to employees under contract for a term. Because G. L. c. 150A is inapplicable to professional employees of nonprofit corporations, the plaintiff" had no “legally guaranteed right” that could serve as the basis for a public policy exception in this case. See Smith-Pfeffer v. Superintendent of the Walter E. Fernald State Sch., supra at 149-150. See Delaney v. Chief of Police of Wareham, 27 Mass. App. Ct. 398, 409 (1989), defining “threat” as “acts or language by which another is placed

Defendant Win
Bradley v. Philip Morris, Inc.
8979Oct 29, 1991Michigan

BRADLEY v PHILIP MORRIS, INC Docket Nos. 112019, 112807. Submitted June 11, 1991, at Detroit. Decided October 29, 1991; approved for publication April 28, 1992, at 9:00 a.m. Ronald Bradley and Cynthia Carsley brought an action in the Oakland' Circuit Court against Philip Morris, Inc., and its supervisors, W. Allen Graham and Barry Hopkins, alleging wrongful discharge and tortious interference with a contractual relationship. The plaintiffs had been discharged after engaging in sexual intercourse in the presence of a fellow employee in a hotel room provided by Philip Morris for the purpose of entertaining its clients. The court, Jessica R. Cooper, J., excluded evidence of alleged previous sexual misconduct of the plaintiffs and evidence indicating Philip Morris’ concern regarding its potential liability to the plaintiffs’ fellow employee under a claim of unlawful sexual discrimination based on a hostile work environment. In excluding the evidence, the court ruled that it was irrelevant because it was discovered by Philip Morris after the employment had been terminated. The jury returned a verdict for the plaintiffs on both claims and awarded damages. The court subsequently denied the defendants’ motion for judgment notwithstanding the verdict and the plaintiffs’ motion for costs and attorney fees incurred in responding to the defendants’ posttrial motions. The defendants’ and the plaintiffs’ appeals from the denials were consolidated. The Court of Appeals held: 1. The trial court abused its discretion in excluding evidence of the alleged earlier misconduct of the plaintiffs. Evidence of employee misconduct occurring before termination of employment is admissible as substantive evidence even if the former employer did not know of the misconduct until after termination. _2. The trial court likewise abused its discretion in excluding evidence of Philip Morris’ concern over a possible sexual harassment claim by the plaintiffs’ fellow employee. The exclusion of the evidence precluded the jury from fully considering the reasons for the termination of the plaintiffs’ employment and whether just cause existed. References Am Jur 2d, Civil Rights §§ 154 et seq.; Contracts § 289; Master and Servant §§ 49 et seq. 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 §§ 2000e et seq.). 78 ALR Fed 252. 3. The trial court’s evidentiary rulings require reversal of the judgment against Philip Morris and a new trial with regard to the claim of wrongful discharge. 4. Reversal of the judgment against defendants Graham and Hopkins is also required. In order to maintain an action for tortious interference with a contract, a plaintiff must establish that the defendant instigated the breach of contract and did so without justification. The defendant is not liable if, as in this case, the defendant is a corporate agent or officer who acted on the employer’s behalf. A new trial against Graham and Hopkins is precluded in light of incontrovertible evidence that they acted not for their benefit but for the benefit of Philip Morris. Reversed and remanded. 1. Master and Servant — Termination of Employment — Just Cause. Just cause for termination may include facts and circumstances existing at the time of termination but not known to the employer. 2. Civil Rights — Sexual Harassment — Hostile Work Environment. An employer accused of sexual harassment on the basis of a hostile work environment may avoid liability if it adequately investigated and took prompt and appropriate remedial action upon notice of the alleged hostile work environment. 3. Torts — Interference with Contracts — Employment Contracts. A corporate officer or agent who disciplines or discharges an employee is liable for tortious interference with a contract only where the officer or agent acted for personal benefit and not for the benefit of the corporate employer. Sachs, Nunn, Kates, Kadushin, O'Hare, Helveston & Waldman, P.C. (by Kathleen L. Bogas), for the plaintiffs. Miller, Canñeld, Paddock & Stone (by W. Mack Faison, Gerald E. Rosen, and Diane M. Soubly), for the defendants. Before: Jansen, P.J., and Sullivan and Weaver, JJ. Sullivan, J. Plaintiffs’ suit against their former employer, defendant Philip Morris, Inc., and two of its employees, defendants W. Allen Graham and Barry Hopkins, arose out of the termination of plaintiffs’ employment. Plaintiffs alleged wrongful discharge and tortious interference with contractual relationships. Following a jury trial, the jury returned a verdict for plaintiffs on both theories. Plaintiff Bradley was awarded $906,000 against Philip Morris, $10,600 against Hopkins, and $14,500 against Graham. Plaintiff Carsley was awarded $500,000 against Philip Morris, $10,600 against Hopkins, and $14,500 against Graham. A judgment was entered in accordance therewith. Defendants’ posttrial motions were denied. They now appeal as of right. We reverse and remand for a new trial on plaintiffs’ claims against Philip Morris, and reverse the judgment against defendants Graham and Hopkins with no new trial. At the outset, we note that reversal of the judgment against Philip Morris is based on the exclusion of evidence we believe Philip Morris was entitled to present to the jury for a proper determination — evidence of misconduct of plaintiffs, which was not discovered until after their employment was terminated, and evidence of Philip Morris’ duties under title VII of the Civil Rights Act of 1964, 42 USC 2000e et seq., and the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq. The termination of plaintiffs’ employment arose out of events that allegedly occurred on a Detroit Grand Prix weekend in a hotel room paid for by Philip Morris. Philip Morris arranged to have hotel rooms available in the Westin Hotel for its employees and for the purpose of entertaining clients. Plaintiff Ronald Bradley and defendants Graham and Hopkins all were supervisors in Philip Morris’ Farmington Hills office. On the evening in question, two secretaries who worked in the Farmington Hills office — plaintiff Cynthia Carsley and Gina Stauch — met other Philip Morris employees in the Renaissance Center for drinks. Bradley, Carsley, and Stauch ended up in Bradley’s hotel room, which was paid for by Philip Morris. Briefly put, Stauch alleged that she fell asleep in a chair in the room, and when she awoke a few hours later, Bradley and Carsley were having sexual intercourse in the bed located a few feet away. Out of concern over what would happen if they knew she had seen them, Stauch ignored the situation. Eventually, however, Stauch’s allegations were made known to Graham and Hopkins. Stauch’s work performance and attitude had allegedly declined and she no longer respected Bradley or Carsley. Graham testified that he believed Bradley was favoring Carsley by not assigning her work when she did not appear to be busy. Although Bradley and Carsley testified that they did not have sexual intercourse on the night in question, they were both fired for misconduct — offensive action to another employee. Plaintiffs’ theory at trial was threefold. First, they argued that Stauch had lied, they did not have intercourse in the hotel room in front of Stauch, and therefore just cause to terminate their employment did not exist. Then they argued that, even if Stauch was not lying, the misconduct was not work-related. Finally, they argued that Philip Morris did not follow its six-step procedure in terminating their employment — the rules were not uniformly applied as promised. The jury found in favor of plaintiffs. Before trial, plaintiffs moved to exclude any evidence of previous misconduct that was discovered after their employment was terminated. The trial court ruled that such evidence was irrelevant and highly prejudicial. We disagree. Evidence of employee misconduct occurring before termination is admissible as substantive evidence even if the former employer did not know of the misconduct until after the termination. Just cause for termination may include facts and circumstances existing at termination but not known to the employer. See 53 Am Jur 2d, Master and Servant, §46, pp 120-121; Leahey v Federal Express Corp, 685 F Supp 127 (ED Va, 1988); Summers v State Farm Mutual Automobile Ins Co, 864 F2d 700, 708 (CA 10, 1988); and Pugh v See’s Candies, Inc, 203 Cal App 3d 743; 250 Cal Rptr 195 (1988). Moreover, this type of evidence is relevant to the issue of damages. Having reviewed the record, we conclude that the trial court abused its discretion in excluding this type of evidence and in not permitting defendants’ attorney to make a corresponding argument to the jury. Furthermore, the trial court precluded defendants’ attorney from presenting evidence regarding defendants’ duties under title VII and the Civil Rights Act with regard to claims of sexual harassment and defendants’ concern over its potential liability to Stauch. An employer may avoid liability for a sexual discrimination claim based on a hostile work environment if it adequately investigated and took prompt and remedial action upon notice of the alleged hostile work environment. Downer v Detroit Receiving Hosp, 191 Mich App 232; 477 NW2d 146 (1991). In the recent decision in Reisman v Regents of Wayne State University, 188 Mich App 526; 470 NW2d 678 (1991), involving reverse discrimination, a panel of this Court held that the trial court’s instruction that if race was at least one of the reasons for not renewing the plaintiffs contract, the defendant could not avoid liability to the plaintiff by claiming that the defendant’s acts were done pursuant to an unapproved affirmative action plan precluded the jury from considering the defendant’s possible affirmative action motivation as a justification for the decision not to renew the plaintiff’s contract. The Court reasoned that unapproved affirmative action plans are not invalid and that actions taken pursuant to such plans are not discriminatory per se. To hold that an unapproved plan is void ignores the purpose of the Civil Rights Act and fails to consider the duty of public employers under the federal constitution to implement affirmative action programs to remedy the effects of past discrimination. Id., p 537. As in Reisman, the trial court in this case precluded a "defense” from being presented to the jury, resulting in error requiring reversal. We believe that the trial court’s exclusion of evidence of defendants’ concern over its potential liability to Stauch for a possible sexual harassment claim precluded the jury from fully considering defendants’ reasons for terminating plaintiffs’ employment and whether just cause existed. It is not enough that an employer acted in good faith or was not unreasonable in discharging an employee. Instead, the jury must determine whether the reason for discharge amounted to good cause. Renny v Port Huron Hosp, 427 Mich 415, 429; 398 NW2d 327 (1986). The evidence sought to be admitted in this case was relevant to determinations the jury was required to make. Because of the exclusion of these two types of evidence, a new trial is warranted with regard to plaintiffs’ wrongful discharge claim. We also reverse the judgment against individual defendants Graham and Hopkins. However, a new trial is not warranted. Instead, we hold that the trial court erred in not granting judgment notwithstanding the verdict. To maintain a cause of action for tortious interference with a contract, a plaintiff must establish that the defendant instigated the breach of a contract and did so without justification. Henry v Hosp & Health Services Credit Union, 164 Mich App 90, 94; 416 NW2d 338 (1987); Dzierwa v Michigan Oil Co, 152 Mich App 281, 287; 393 NW2d 610 (1986). The defendant is not liable if, as here, he is a corporate agent or officer and if he acted on his employer’s behalf. In other words, the defendant who is a corporate officer or agent is liable for tortious interference only if he acted for his own benefit with no benefit to the corporation. See Stack v Marcum, 147 Mich App 756, 759-760; 382 NW2d 743 (1985), and Tash v Houston, 74 Mich App 566, 571-574; 254 NW2d 579 (1977). In this case, even viewing the evidence in a light most favorable to plaintiffs — the nonmoving party —we conclude that reasonable minds could not differ over whether Graham and Hopkins were acting for the benefit of Philip Morris or for their own personal benefit with no benefit to Philip Morris. The evidence and the inferences to be drawn therefrom failed to show that Graham’s and Hopkins’ actions were based on personal motivation and that the actions were for their personal benefit. The judgment against Graham and Hopkins is reversed. This matter is remanded for a new trial on the wrongful discharge claim only. During the direct examination of Philip Morris’ director of employee relations, defendants’ attorney asked the witness whether under the circumstances of this case the company had "any liabilities, vis-a-vis Title Seven of the Civil Rights Act of 1964.” The witness answered definitely. But plaintiffs’ subsequent objection was sustained because this was not a title VII action, and the question was withdrawn. Moreover, on redirect examination, the same witness testified that the company was worried about its liability to Stauch if the company failed to do anything about her complaints. Plaintiffs’ objection was again sustained. The standard of review is: A trial court’s denial of a motion for judgment notwithstanding the verdict is reviewed to determine whether there are material issues of fact upon which reasonable minds might differ. Means v Jowa Security Services, 176 Mich App 466, 471; 440 NW2d 23 (1989). In deciding a motion for directed verdict or for judgment notwithstanding the verdict, a trial court must examine the testimony and all legitimate inferences that may be drawn from that testimony in a light most favorable to the nonmoving party. When the evidence is such that reasonable jurors could disagree, neither the trial court nor this Court may substitute its judgment for that of the jury. Means, supra. [Lester N Turner, PC v Eyde, 182 Mich App 396, 398; 451 NW2d 644 (1990).]

Mixed Result$1,456,200 awarded
Howard v. Canteen Corp.
8979Oct 15, 1991Michigan

HOWARD v CANTEEN CORPORATION Docket No. 120825. Submitted May 13, 1991, at Detroit. Decided October 15, 1991; approved for publication January 15, 1992, at 9:00 a.m. Carol J. Howard brought an action in the Wayne Circuit Court against Canteen Corporation and David Spender, alleging breach of an employment contract and sexual discrimination as a result of the defendants’ failure to promote her, harassment, retaliation, and wrongful termination of her employment. The jury returned a verdict for the plaintiff on the claims for breach of contract and sex discrimination, and the court, Louis F. Simmons, Jr., J., entered a judgment for $299,530 plus interest, costs, and attorney fees. The defendants appealed from the denial of their motions for directed verdict, judgment notwithstanding the verdict, a new trial, and remittitur. The Court of Appeals held: 1. There was sufficient evidence of sexual discrimination on the basis of the failure to promote, sexual harassment, retaliation, and wrongful discharge and of breach of contract to send the case to the jury and to support its verdicts regarding those claims. The trial court did not err in denying the defendants’ motions for directed verdict or judgment notwithstanding the verdict. 2. The award of $200,000 for mental anguish, emotional distress, and humiliation associated with the sex discrimination claims was supported by the evidence and was not excessive. The court did not abuse its discretion in denying the defendants’ motion for remittitur. 3. The court did not abuse its discretion in denying the defendants’ motion for a new trial. 4. A remand is necessary for an evidentiary hearing regarding the reasonableness of the attorney fees awarded to the _plaintiff because the defendants were not provided a sufficient opportunity to challenge the affidavits and other documentary evidence in support of the requested fees and the trial court did not make findings of fact with regard to the attorney fee issue. References Am Jur 2d, Costs §§ 72, 79, 261; Damages §§ 143, 144, 678; Job Discrimination § 2498. Effect of anticipated inflation on damages for future losses — modern cases. 21 ALR4th 21. 5. The use of a multiplier for the attorney fees granted under the Civil Rights Act was not justified under the circumstances of this case, and, therefore, the portion of the attorney fees awarded that are attributable to the multiplier is vacated. 6. The award of attorney fees under both the Civil Rights Act and MCR 2.403(0) was appropriate because each provision serves an independent policy or purpose. The court, on remand, must determine the reasonableness of the fees awarded as mediation sanctions. 7. The court erred in failing to reduce the award for damages for the plaintiffs future wage loss to present value or to instruct the jury to do so. Inflation is a factor that may be considered in assessing damages, but a court may not employ it to omit the present-value reduction. Remand is required for the court to reduce the future wage loss award to present value. Affirmed in part, reversed in part, and remanded. 1. Attorney and Client — Attorney Fees. Each party in a lawsuit ordinarily bears its own attorney fees unless there is express statutory authorization to the contrary. 2. Civil Rights — Attorney Fees — Findings of Fact. A trial court, in its discretion, may award reasonable attorney fees in cases involving violations of the Civil Rights Act; the court, where attorney fees are to be awarded, must determine the reasonable amount of fees according to the nonexclusive list of factors and guidelines set forth in Wood v DAIIE, 413 Mich 573 (1982), and, while not required to detail its findings regarding each specific factor, it is required to make findings of fact with regard to the issue of attorney fees (MCL 37.2802; MSA 3.548[802]). 3. Attorney and Client — Attorney Fees — Evidentiary Hearings. The party seeking an award of attorney fees bears the burden of establishing entitlement and documenting the appropriate hours expended and hourly rates; where the opposing party challenges the reasonableness of the requested fee, the trial court should hold an evidentiary hearing regarding the issue, and, if any of the underlying facts are in dispute, the court should make findings of fact regarding those issues. 4. Attorney and Client — Attorney Fees. A reasonable attorney fee is presumed to be based on a reasonable hourly rate multiplied by a reasonable number of hours expended; a trial court’s discretion to increase such a presumptively reasonable attorney fee is limited to rare circumstances where the attorney’s work is so superior and outstanding that it far exceeds client expectations and normal levels of competence, or where it is necessary for attracting competent counsel. 5. Civil Rights — Attorney Fees — Mediation Sanctions. Reasonable attorney fees may be awarded under both the court rule governing mediation sanctions and the attorney fee provision of the Civil Rights Act in an appropriate case because each provision serves an independent policy or purpose (MCR 2.403[O]; MCL 37.2802; MSA 3.548[802]). 6. Damages — Future Losses — Present Value. An award of damages for future losses must be reduced to its present cash value; a trial court faced with such an award either must instruct the jury regarding such reduction or reduce the award to its present value. . 7. Damages — Future Losses — Inflation. Inflation is a factor that may be considered in assessing damages, but it does not entitle a trial court to ignore the duty to reduce to present value an award of damages for future losses. Kelman, Loria, Downing, Schneider & Simpson (by Janet M. Tooley), for the plaintiff. Clark, Klein & Beaumont (by P. Robert Brown, Jr., Dorothy M. Basmaji, Amy Bateson, Sheryl A. Moody, and Nancy J. Gordon), for the defendants. Before: Cavanagh, P.J., and Neff and W. R. Beasley, JJ. Former Court of Appeals judge, sitting on the Court of Appeals by assignment. Per Curiam. In this gender-based discrimination case, defendants appeal as of right from a judgment entered on a jury verdict of approximately $300,000. They also claim that the trial court erred in denying their posttrial motions for directed verdict, judgment notwithstanding the verdiet, a new trial, and remittitur. We affirm in part and reverse in part. Plaintiff, Carol Howard, began working at defendant Canteen’s Cadillac 5 cafeteria as a shift supervisor in 1982. In September 1984, defendant David Spender was hired as manager of Cadillac 5. Plaintiff claims that Spender performed several acts and made several statements that constituted sexual harassment. Shortly before plaintiff left Canteen’s employ, she had a meeting with Bernard Palko, manager of food services, and Spender regarding her complaints where Spender claimed that, rather than harassing, he was only complimenting plaintiff in the things he had said. Plaintiff believed that the two men were only trying to appease her and that she was not going to get anywhere with her complaint. Spender told plaintiff after the meeting that she would be terminated, removed, or reprimanded, and that he was going to make sure she was transferred out of Cadillac 5. During plaintiff’s last week of employment, Palko told her that she was being transferred to the Cadillac Main account, which was located in a dangerous neighborhood in Detroit and was a farther distance from her home. She protested the transfer, which was obviously undesirable for her, as being made only because Spender could not be controlled. She turned down the transfer because of the way it was handled, it would cause her financial hardship, she did not have reliable transportation to drive the farther distance, she would not be getting extra income, and her feelings regarding her safety. Palko told her that if she did not transfer, she would be considered terminated. Plaintiff did not return to work for Canteen. In February 1986, plaintiff filed suit against defendants, alleging, among other things, breach of contract and sexual discrimination as a result of defendants’ failure to promote her, harassment, retaliation, and wrongful termination of her employment. These issues were thoroughly ventilated before the jury, and, after trial, the jury returned a verdict in plaintiff’s favor on both the breach of contract and sex discrimination claims. The trial court entered a judgment for $299,530, plus interest, costs, and attorney fees. Defendants filed motions for directed verdict, judgment notwithstanding the verdict, a new trial, and remittitur, which were denied. Defendants appeal. First, defendants claim the trial court erred in denying their motions for directed verdict or judgment notwithstanding the verdict because there was insufficient evidence to send the case to the jury or to support the verdicts for sexual discrimination and breach of contract. When deciding motions for directed verdict and judgment notwithstanding the verdict, the trial court must view the evidence in a light most favorable to the nonmoving party. Relief is required where insufficient evidence is presented to create an issue for the jury. Conversely, relief is not required where reasonable minds could differ on issues of fact. We will not disturb the trial court’s decision unless there has been a clear abuse of discretion. To establish a prima facie case of sex discrimination, the plaintiff must show membership in a class protected under the Civil Rights Act and that, for the same or similar conduct, the plaintiff was treated differently than a member of the opposite sex. If the defendant employer asserts legitimate, nondiscriminatory reasons for its actions, the plaintiff must then show that the reasons asserted were a mere pretext for discrimination. With regard to plaintiff’s claim of sexual discrimination regarding the failure to promote her to the Cadillac 5 manager position, for which she had requested consideration, defendants argue that plaintiff did not present sufficient evidence to support her claim because Spender was more qualified for the position than she was. However, plaintiff presented evidence that she had supervisory experience before coming to work for Canteen in 1982, she had filled in for the manager at another location on numerous occasions, she had managed both shifts of the Cadillac 5 cafeteria for a few weeks before Spender was hired, and she had generally fulfilled all the job duties of a manager at some point in time. Additionally, she was told by Palko to try to assist and guide a previous manager because she had more experience. Viewing this and the other evidence of discrimination in a light most favorable to plaintiff, a jury question was raised regarding whether plaintiff had shown, by a preponderance of the evidence, that she applied for an available position for which she was qualified but was rejected under circumstances giving rise to an inference of unlawful conduct and that sex discrimination played a significant role in the decision to deny plaintiff the promotion._ With regard to plaintiffs claim of sexual harassment, defendants argue that plaintiff did not present sufficient evidence to establish either quid pro quo sexual harassment or sexual harassment that results from a hostile or offensive work environment. However, the jury heard testimony that Spender would inquire into plaintiffs personal life, asking why she was divorced and how she could get a younger man like Michael Hobson, her live-in boyfriend who also worked on her shift at Cadillac 5; that Spender asked if plaintiff paid Hobson for his sexual favors, how she could keep up with a younger man, and why she was not more sociable with a man of Spender’s age; and that Spender also told plaintiff that if it were not for Hobson, he and plaintiff would be "closer” and they would have a better "working relationship.” Additionally, the jury heard testimony that Spender would open, read, and throw away plaintiffs mail, would go through her purse, and had grabbed a personal check out of her hand, and that he told plaintiff that women should not work out in public, that she was too aggressive, and that she was wasting her time because the company did not promote women to upper management positions, but rather would stick them in lower management positions just to keep various women’s groups happy. The jury also heard testimony that Spender told plaintiff she was not going to go anywhere unless she cooperated and that Spender was responsible for food shortage problems that occurred two or three times a week. This evidence, if accepted by the jury, was sufficient to show, at least, sexual harassment resulting from a hostile or offensive work environment. Regarding plaintiffs claim of sexual discrimination concerning retaliation, defendants argue that there was nothing of an actionable nature to retaliate against, that there was no evidence of retaliation, and that plaintiffs claim of retaliation based on her transfer to Cadillac Main was pure speculation. However, plaintiff testified that, after the meeting between Palko, Spender, and herself, Spender told her she would be terminated, removed, or reprimanded and that Spender would make sure plaintiff was moved out of his account. Soon afterward, plaintiff was told she must transfer to what was for her a much less desirable situation. Further, when plaintiff refused to transfer, Canteen hired a person "off the street” to fill the position, which tends to render quite unbelievable defendants’ claim that this was a promotion or growing experience for plaintiff. Viewing this evidence in a light most favorable to plaintiff, there was ample evidence for the jury to reasonably find that the elements of plaintiffs retaliation claim were proved. With regard to plaintiffs claim of sexual discrimination concerning her discharge, there was sufficient evidence to support the jury’s findings. Plaintiff was terminated immediately after she refused the transfer to Cadillac Main. She presented evidence that, in the context of this case, working conditions there were so difficult or unpleasant that a reasonable person in her shoes would have felt compelled to resign and that such action was a reasonably foreseeable consequence of Canteen’s conduct. As indicated, there was evidence that plaintiffs employment situation had been made intolerable by discrimination and sexual harassment and that her employment situation was further aggravated by a transfer to an undesirable location. Defendants also argue that there was insufficient evidence to support plaintiffs claim of breach of contract. However, plaintiff testified that Palko had told plaintiff that as long as she was familiar with the company’s policies, followed those policies, and did her job well, she would have a future with Canteen. Such verbal statements can give rise to a contract that an employee will be discharged only for just cause. In addition, Palko testified that it was Canteen’s policy not to terminate employees without a fair reason or just cause. Thus, plaintiff presented sufficient evidence to support her claim for breach of contract. Viewing all the evidence in a light most favorable to plaintiff, we do not find that the trial court abused its discretion in denying defendants’ motions for directed verdict and judgment notwithstanding the verdict. Second, defendants claim that the evidence was insufficient to support the $200,000 damage award for mental anguish, emotional distress, and humiliation with regard to the discrimination count, and they contend that the trial court erred in denying their motion for remittitur. Victims of discrimination may recover for the humiliation, embarrassment, disappointment, and other forms of mental anguish resulting from the discrimination, and medical testimony substantiating the claim is not required. When a verdict is within the range of the evidence produced at trial, it should not be reversed as excessive. With regard to remittitur, the only consideration expressly authorized by the remittitur court rule, MCR 2.611(E)(1), is whether the award is supported by the evidence. However, other objective factors such as whether the verdict was induced by bias or prejudice relating to the actual conduct of the trial or to the evidence adduced may be considered. The testimony indicated that defendants’ actions left plaintiff sad and depressed and that she is still dealing with her problems today. She is behind in paying her bills and suffers from a medical problem that she believes stems from her work situation. The evidence to support these results is found in the harassment and discrimination inflicted upon her for a lengthy period of time, despite her complaints to Palko. Under these circumstances, we do not believe the award was excessive, nor do we believe, giving deference to the trial court that personally observed the witnesses and heard the testimony, that the trial court abused its discretion in denying defendants’ motion for remittitur. Third, defendants claim that the trial court abused its discretion in denying their motion for a new trial because of numerous errors or irregularities in the trial proceedings. We have reviewed each of defendants’ alleged errors and do not find that the trial court abused its discretion so as to justify a new trial. Fourth, defendants claim that the trial court erred in its award of attorney fees. They contend that the attorney fees requested and granted were unreasonable, that the use of a multiplier for the fees granted under the Civil Rights Act was not justified, and that an additional award of attorney fees as a mediation sanction constituted double-dipping. The "American Rule” provides that each party in a lawsuit ordinarily bears its own attorney fees unless there is express statutory authorization to the contrary. MCL 37.2802; MSA 3.548(802) provides the authority to award reasonable attorney fees in state civil rights cases. The decision to grant or deny attorney fees under the Civil Rights Act is discretionary with the trial court. Where attorney fees are to be awarded, the court must determine the reasonable amount of fees according to the nonexclusive list of factors and guidelines set forth in Wood v DAIIE. While the court is not required to detail its findings regarding each specific factor, it is required to make findings of fact with regard to the attorney fee issue. The most useful starting point for determining the amount of a reasonable attorney fee is the number of hours reasonably expended on the case multiplied by a reasonable hourly rate. The party seeking the fee bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates. In plaintiffs brief in support of her motion for attorney fees submitted to the trial court, plaintiffs attorney claims that she does not keep contemporaneous time records. She stated: It may be noted that Plaintiffs firm does not ordinarily keep contemporaneous billing records, as we are strictly a plaintiffs law firm and rarely bill clients. While such records are not required to be kept, in demanding a large sum of attorney fees the lack of contemporaneous time records leaves room for doubt regarding the reasonableness of the hours expended. Where the opposing party challenges the reasonableness of the requested fee, the trial court should hold an evidentiary hearing regarding the issue. If any of the underlying facts, such as the number of hours spent in preparation, are in dispute, the trial court should make findings of fact regarding the disputed issues. In this case, no evidentiary hearing was held regarding the reasonableness of the attorney fee. Rather, plaintiffs counsel submitted affidavits and other documentary evidence in support of her requested fees, and oral arguments were heard. The trial court, in ruling on the issue, stated: [T]he Court is satisfied that both

Plaintiff Win$299,530 awarded
Oscar Morris v. Equal Employment Opportunity Commission, Donald W. Muse, Jane Doe Muse, Clarence Thomas
9th CircuitSep 12, 1991
Defendant Win
Ourfalian v. Aro Manufacturing Co.
8980Aug 29, 1991Massachusetts

Maurice Ourfalian vs. Aro Manufacturing Company, Inc., & another. No. 89-P-1043. Middlesex. December 6, 1990. August 29, 1991. Present: Brown, Perretta, & Jacobs, JJ. Contract, Employment. Employment, Termination. Public Policy. Practice, Civil, Complaint. In a civil action, the defendants’ alleged violation of the public policies reflected in G. L. c. 149, § 24A (prohibiting an employee’s dismissal based on age), and G. L. c. 152, § 75A (requiring rehiring preference to a workers’ compensation claimant), as to each of which the Legislature has provided statutory remedies, gave rise to no common law cause of action by a former at-will employee who claimed that he had been wrongfully discharged from employment. [295-296] In an action by a former at-will employee, the plaintiff’s assertion that the defendants lacked just cause for discharging him stated no ground for relief. [296] In an action by a former at-will employee, the complaint and the inferences therefrom were sufficient to state a claim that the corporate defendant, the plaintiff’s former employer, had discharged him in retaliation for filing a workers’ compensation claim, entitling him to relief under G. L. c. 152, § 75B (2). [296-298] Civil action commenced in the Superior Court Department on May 20, 1987. The case was heard by Hiller B. Zobel, J., on a motion to dismiss. Philip .S'. Iuliano (Zaven Kaprielian with him) for the plaintiff. John A. Dziamba for the defendants. Sidney Shapiro, president and chief executive officer of Aro Manufacturing Company, Inc. Jacobs, J. After approximately nineteen and one-half years of continuous at-will employment with the defendant Aro Manufacturing Company, Inc. (Aro), the plaintiff was fired from his job. In his amended complaint in the Superior Court, he alleged that his discharge on October 20, 1986, was wrongful and without good or just cause; that he had not worked for four weeks previous to that date due to a workplace injury; and, that prior to his firing, other employees of Aro who had been injured at work and filed workers’ compensation claims had been discharged from employment. The legal theories in support of the complaint were set forth in five counts. Counts I, II, III, and IV sought to impose liability on the defendant Sidney Shapiro for a “bad faith discharge,” for breaches of the plaintiff’s “implied contract of continued employment” and “implied covenant of good faith,” and for violations of the public policy of the Commonwealth as reflected in G. L. c. 149, § 24A (prohibiting dismissal based on age), and G. L. c. 152, § 75A (requiring rehiring preference to a workers’ compensation claimant). Count V sought to impose liability on Aro for Shapiro’s actions “under the doctrine of respondeat superior.” This appeal is precipitated by the allowance of the defendants’ third motion to dismiss. The judge correctly dismissed those portions of the complaint that allege violations of the public policies reflected by G. L. c. 149, § 24A, and G. L. c. 152, § 75A. Although “[a] basis for a common law rule of liability can easily be found when the Legislature has expressed a policy position concerning the rights of employees and an employer discharges an at-will employee in violation of that established policy[,]” Mello v. Stop & Shop Cos., 402 Mass. 555, 557 (1988), generally no common law cause of action is established where “the Legislature has also prescribed a statutory remedy.” Ibid. The statutes upon which the plaintiff relies for public policy pronouncements contain recognized and comprehensive sanctions: G. L. c. 152, § 75A, provides for a civil action and specific remedies, Federici v. Mansfield Credit Union, 399 Mass. 592, 597 (1987), and, although G. L. c. 149, § 24A, sets out only a criminal penalty, the public policy against age discrimination is already protected by a comprehensive legislative scheme, G. L. c. 151B, see Melley v. Gillette Corp., 19 Mass. App. Ct. 511, 512-513 (1985). To create common law actions based on policies expressed in those statutes would impermissibly interfere with those remedial schemes. Id. at 513-514. Also, the bald assertion of lack of just cause for discharge, standing alone, cannot sustain the complaint. Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 671 (1981). Our courts have recognized that an employer’s need for “wide latitude in deciding whom it will employ,” Fortune v. National Cash Register Co., 373 Mass. 96, 102 (1977), is not outweighed by any general concept of employee job security. See Cort v. Bristol-Myers Co., 385 Mass. 300, 305-306 (1982). Standing on a different footing, however, is the complaint allegation of a bad faith discharge. When read in combination with the plaintiff’s allegations of having suffered a workplace injury at the time of his discharge and of the firing of several Aro employees for filing workers’ compensation claims, the clear inference to be drawn from the complaint, if it is to be construed so as to do substantial justice, see Nader v. Citron, 372 Mass. 96, 98, 104 (1977); Mass.R.Civ.P. 8(f), 365 Mass. 751 (1974), is that the plaintiff was discharged in retaliation for filing such a claim. The plaintiff argues that his implicit allegation of retaliatory discharge implicates a public policy which is entitled to common law protection. See Glaz v. Ralston Purina Co., 24 Mass. App. Ct. 386, 389-390 (1987)(claim exists where employee can “point to some clearly-defined and well-established public policy that is threatened by the employer’s action . . . [such as] termination ... in retaliation for performing an important and socially desirable act . . .”). Our courts have not spoken to this issue. See Federici v. Mansfield Credit Union, 399 Mass, at 594 & n.3. We need not reach the question because our workers’ compensation act clearly establishes both a right and a remedy in the circumstances alleged. Magerer v. John Sexton & Co., 727 F. Supp 744, 751 (D. Mass.), aff'd, 912 F.2d 525 (1st Cir. 1990). Mello v. Stop & Shop Cos., 402 Mass, at 557 n.2. General Laws c. 152, § 75B(2), as amended by St. 1986, c. 662, § 49, provides: “No employer or duly authorized agent of an employer shall discharge ... an employee because the employee has exercised a right afforded by this chapter .... Any person claiming to be aggrieved by a violation of this section may initiate proceedings in the superior court department of the trial court for the county in which the alleged violation occurred. An employer found to have violated this paragraph shall be exclusively liable to pay to the employee lost wages, shall grant the employee suitable employment, and shall reimburse such reasonable attorney fees incurred in the protection of rights granted as shall be determined by the court. The court may grant whatever equitable relief it deems necessary to protect rights granted by this section.” The complaint sufficiently states a claim of retaliatory discharge for the filing of a workers’ compensation claim under the statute. In view of its exclusive liability provision, the statute applies only to Aro and not to Shapiro. Accordingly, the allowance of the motion to dismiss is affirmed as to Shapiro (Counts I through IV) and reversed as to Aro (Count V) insofar as the complaint states a claim cognizable under G. L. c. 152, § 75B(2). So ordered. The record .indicates that a motion to dismiss the original complaint under Mass.R.Civ.P. 12(b)(6), 365 Mass. 755 (1974), was denied by a judge other than the judge who allowed the motion to dismiss which is before the court. The original complaint contained general allegations of bad. faith and personal animus on the part of Shapiro but no averment relating to a workplace injury. According to the docket entries, a second motion to dismiss was denied by another judge prior to the filing of the motion to dismiss before the court. All parties treat the motion to dismiss as having been transformed into a motion for summary judgment pursuant to the last paragraph of Mass.R.Civ.P. 12(b). While matters outside of the pleadings were submitted by the parties, the judge, except for a background statement, focused his memorandum of decision on the adequacy of the contents of the complaint. In any event, the complaint and the submitted material, benefited by inferences favorable to the plaintiff, Hub Assocs. v. Goode, 357 Mass. 449, 451 (1970), adequately raise a genuine issue as to whether the plaintiff’s discharge was in retaliation for his making a compensation claim. When, as here, “intent is at the core of a controversy, summary judgment seldom lies.” Madden v. Estin, 28 Mass. App. Ct. 392, 395 (1990). During oral argument, the plaintiff waived his age discrimination claim. It is not fatal to the complaint that G. L. c. 152, § 75B, was not specifically pleaded. Springfield v. Commonwealth, 349 Mass. 267, 270 (1965). Gallant v. Worcester, 383 Mass. 707, 709-710 (1981). Gaillard v. Board of Appeals of Lexington, 6 Mass. App. Ct. 834 (1978). “[A] complaint is not subject to dismissal if it would support relief on any theory of law” (emphasis in original). Whitinsville Plaza, Inc. v. Kotseas, 378 Mass. 85, 89 (1979). Nor does the failure of the parties to address the statute prohibit us from considering it. Foley v. Lowell Sun Publishing Co., 404 Mass. 9, 11 (1989). Since the Legislature has provided a statutory remedy against Aro for the wrong allegedly committed by Shapiro, no common law cause of action is available against him personally, especially in the absence of any allegation that he acted outside of the scope of his employment.

Mixed Result
Ferrett v. General Motors Corp.
8790Aug 27, 1991Michigan

FERRETT v GENERAL MOTORS CORPORATION Docket No. 88489. Argued May 8, 1991 (Calendar No. 3). Decided August 27, 1991. Darwin Ferrett brought an action in the Wayne Circuit Court, against General Motors Corporation, alleging breach of contract and negligent evaluation after his employment with gm was terminated because of excessive absenteeism. The plaintiff contended that gm failed to undertake a third evaluation of his job performance following his failure to maintain an acceptable attendance record after completion of a second ninety-day Performance Improvement Plan. The court, John H. Hausner, J., granted summary disposition for the defendant, holding, with respect to the breach-of-contract claim, that there was no genuine issue of material fact concerning the plaintiff’s status as an employee at will, and, with respect to the negligent-evaluation claim, that it was not based on a legal duty independent of the employment relationship. The Court of Appeals, Doctoroff, P.J., and Shepherd and McDonald, JJ., affirmed in a memorandum opinion (Docket No. 115103). The plaintiff appeals, limited to the issue whether the trial court erred in granting summary disposition for the defendant. In a unanimous opinion by Justice Levin, the Supreme Court held: The trial court did not err in dismissing the plaintiff’s claim of negligent evaluation. There is no right arising at common law as a matter of public policy, separate and distinct from any contractual right, to be evaluated or correctly evaluated before being discharged from employment. 1. Any action arising out of a dismissal from employment would not sound in tort for negligent evaluation, but could be maintained, if at all, only for breach of a contractual obligation to evaluate. Absent an employer’s agreement to provide job security or to discharge only for cause, the employment relationship is at the will of both parties. 2. In this case, the plaintiff essentially was an employee at will; therefore, he did not have a contractual right to be evaluated or correctly evaluated before the employer exercised its right to discharge him at will. Because there is no separate and distinct duty imposed by law on an employer to evaluate or correctly evaluate employees, the plaintiff cannot maintain an action in tort against the employer for failure to evaluate him before exercising its right to discharge him at will without regard to whether there was cause to terminate his employment. Affirmed. William W. Webb for the plaintiff. Stuart R. Cohen, General Counsel, and Richard M. Tuyn, Co-Counsel, for the defendant. Amici Curiae: Mark Granzotto, Monica Farris Linkner, and Charles P. Burbach for Michigan Trial Lawyers Association. Bodman, Longley & Dahling (by Lloyd C. Fell and Kathleen A. Lieder); (William H. Crabtree and V. Mark Slywynsky, of counsel) for Motor Vehicle Manufacturers Association of the United States, Inc. Levin, J. This Court granted leave to appeal, limited to the issue whether the circuit court erred in granting General Motors Corporation summary disposition dismissing Darwin Ferrett’s claim of negligent evaluation. We agree with the Court of Appeals that the circuit court did not err in dismissing Ferrett’s claim of negligent evaluation. i Ferrett was a test driver for General Motors Corporation at its proving grounds in Milford from November, 1973, until the termination of his employment in August, 1986. Although otherwise a good employee, Ferrett’s thirteen years with gm included problems with absenteeism. From early 1983 until the termination of his employment in August, 1986, he was made aware that unless he maintained consistently good attendance, his position with gm would be in jeopardy. As a salaried worker for gm, Ferrett’s employment relationship was the subject of a handbook entitled "Working with General Motors.” The handbook advised workers that their performance would be assessed at least twice annually by their supervisor, and that the assessment program consisted of four main parts: performance planning, informal discussions, written appraisal, and appraisal interview. Performance Improvement Plans, though not specifically discussed in the handbook, were a part of the appraisal and evaluation program. The employee handbook also contained the following statements, the first, under the heading "Employment Status”: As a regular employe, your employment is on a calendar month-to-month basis. [T]he policies and procedures in the booklet do not constitute a legal contract, and do not modify the month-to-month employment relationship .... Beginning in 1983, Ferrett received a number of oral and written warnings from his supervisor that his deteriorating attendance was becoming a significant problem for management. By January, 1984, Ferrett’s attendance problems caused his overall performance rating to drop from "[g]ood [c]ompetent” to "[n]eeds [s]light [ijmprovement because of excessive absenteeism . . . .” Ferrett was placed on a Performance Improvement Plan for ninety days, during which time he maintained an acceptable attendance record. After the Performance Improvement Plan was successfully completed, however, Ferrett’s attendance slackened. In 1985, a memorandum was placed in Ferrett’s file documenting the recurring attendance problems. In 1986, Ferrett was placed on a second ninety-day Performance Improvement Plan that specified strict performance standards and stated that if Ferrett did not reach an acceptable attendance level by the end of the ninety days, his performance rating would be reappraised and management would recommend termination of his employment. During this ninety-day period, Ferrett’s performance again improved. At the end of the ninety days, Ferrett’s supervisor noted that Ferrett had successfully completed the Performance Improvement Plan, and he was reevaluated to "[g]ood [competent.” The supervisor also noted that he had advised Ferrett that "his performance improvement must be sustained in the future or management will recommend termination.” In an appraisal five days later, the supervisor noted that he had told Ferrett "it is very important that he maintain a good attendance record and schedule his time off in the future or management will [recommend] termination.” Between April 22, 1986, the date of the appraisal following the conclusion of the second Performance Improvement Plan, and August 21, 1986, Ferrett missed ten days’ work. He submitted a note for the last of the ten absences, on August 20, 1986, explaining that his mother had been in an accident, and that he had gone to the hospital to visit her. According to a report to the file written by Ferrett’s supervisor, the supervisor reminded Ferrett that under the terms of the last Performance Improvement Plan, he was to maintain perfect attendance and notify the supervisor when he would not be at work, and Ferrett promised to do so. The supervisor did not, however, tell Ferrett that his employment was about to be terminated due to excessive absenteeism. One week later, on August 29, 1986, Ferrett was discharged from further employment with gm. ii Ferrett commenced this action alleging breach of contract and negligent evaluation. The circuit court granted gm’s motion for summary disposition on both the contract and the negligent-evaluation counts. On the breach-of-contract count, the court held that there was no genuine issue of material fact concerning the "at will” status qf Ferrett’s employment. On the negligent-evaluation count, the court held that Ferrett’s claim was not based on a legal duty independent of the employment relationship. The Court of Appeals affirmed. hi The Court of Appeals, and the federal courts in the Sixth Circuit applying Michigan law, have, with two exceptions, held that an employee may not maintain a tort action for negligent evaluation. Those cases, relying on this Court’s decision in Hart v Ludwig, 347 Mich 559; 79 NW2d 895 (1956), generally reason that an employee may not maintain such an action because he does not seek to recover for breach of a duty separate and distinct from any breach of contract. Loftis v GT Products, Inc, 167 Mich App 787, 796; 423 NW2d 358 (1988), typifies Court of Appeals cases holding that an employee may not maintain an action for negligent evaluation on the basis of an asserted breach of an employment contract. The employee claimed that his employer was required under the terms of the employee handbook to evaluate its employees and to use reasonable care in performing an evaluation. The Court held that the employee could not maintain an action because his complaint "did not allege a breach of duty . . . distinct from the breach of contract, an essential element of a cause of action for negligent evaluation . . . .” The Court read this Court’s holding in Hart to mean that "[a] tort action will lie if a relationship or situation of peril exists that would give rise to a legal duty without the need to enforce the contract promise itself.” Id. at 797. A number of panels of the Court of Appeals and of the United States Court of Appeals for the Sixth Circuit have reached the same result. IV We decline to recognize an action in tort for negligent evaluation. An action may be maintained, if at all, only for breach of a contractual obligation to evaluate. In Hart v Ludwig, this Court held that the plaintiff could not maintain an action in tort for nonperformance of a contract. That was the holding. Everything else that was said was obiter dictum. The effort to extract from that obiter dictum a rationale for evolving a tort action for negligent evaluation is not persuasive. A duty in tort may arise out of a relationship. The asserted relationship here is a contract that was terminable at the will of either Ferrett or gm. Whether the contract was express or implied, even if it included implied obligations arising out of policies set forth in the employee handbook, the circuit court found that the employment contract did not give rise to enforceable obligations. The Court of Appeals affirmed. The correctness of that determination is not before us because this Court’s order granting leave to appeal was limited to the question whether Ferrett’s claim of negligent evaluation was correctly dismissed. v Ferrett complains essentially that gm failed to perform an asserted obligation, arising out of the procedures set forth in the employee handbook, to undertake a third Performance Improvement Plan when he failed to maintain an acceptable attendance record following the completion of the second ninety-day Performance Improvement Plan. In Hart, supra, pp 565-566, this Court held that an action in tort may not be maintained for failure to perform a contract: 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.] In Hart, the defendant worked the plaintiff’s orchard during the spring of 1952, but "refused to go on” shortly after beginning work for the 1953 season. "He thereafter failed to remove the shoots, to prune, to fertilize, or to protect it against destructive animal life.” In the instant case, as in Hart, "[w]hat we are left with is defendant’s [alleged] failure to complete his contracted-for performance.” Here, as there, the contracted-for performance is not "a duty imposed by the law upon all,” but, rather, "a duty arising out of the intentions of the parties themselves and owed only to those specific individuals to whom the promise runs.” VI In Valentine v General American Credit, Inc, 420 Mich 256, 258-259; 362 NW2d 628 (1984), this Court said that "[ejmployers and employees remain free to provide, or not to provide, for job security. Absent a contractual provision for job security, either the employer or the employee may ordinarily terminate an employment contract at any time for any, or no, reason.” Absent an employer’s agreement to provide job security or to discharge only for cause, the employment relationship is at the will of both parties. Ferrett was essentially an at-will employee — his employment was month to month — and therefore he did not have a contractual right to be evaluated or correctly evaluated before the employer exercised its right to discharge him at will. Just as the law did not impose on the person who agreed to work the orchard in Hart v Ludwig a duty to complete the contracted-for performance, or the defendant in Valentine a duty to provide job security, neither does it impose on gm a common-law obligation to evaluate or correctly evaluate Ferrett before exercising its right to discharge him at will. There is, thus, no right arising at common law as a matter of public policy, separate and distinct from any contractual right, to be evaluated or correctly evaluated before being discharged from employment. Cases recognizing a right to maintain an action in tort arising out of a breach of contract by the defendant, generally involve a separate and distinct duty imposed by law for the benefit of the plaintiff that provides a right to maintain an action without regard to whether there was a contractual relationship between the plaintiff and the defendant. In Clark v Dalman, 379 Mich 251, 261, 262; 150 NW2d 755 (1967), the duty "imposed by law” was ”[t]he general duty of a contractor to act so as not to unreasonably endanger the well-being of employees of either subcontractors or inspectors, or anyone else lawfully on the site of the project . . . VII We conclude that because there is no separate and distinct duty imposed by law to evaluate or correctly evaluate employees, Ferrett cannot maintain an action in tort against gm because it failed to undertake a third Performance Improvement Plan, or otherwise evaluate or reevaluate him before exercising its right to discharge him at will without regard to whether there was or was not cause to terminate his employment. Affirmed. Cavanagh, C.J., and Brickley, Boyle, Riley, Griffin, and Mallett, JJ., concurred with Levin, J. 437 Mich 851 (1990). In Schipani v Ford Motor Co, 102 Mich App 606; 302 NW2d 307 (1981), the employee alleged that the defendant, whose practice was to • periodically evaluate its employees, had negligently evaluated him. The Court of Appeals held that, although the defendant was not under an independent duty to evaluate its employees, once it undertakes periodic evaluations it becomes obligated to conduct them fairly. The Court quoted the statement in Hart v Ludwig, 347 Mich 559; 79 NW2d 895 (1956), to the effect that the law imposes an obligation on everyone who attempts to do anything, to do it fairly, so that negligent performance of a contract could give rise to a cause of action in tort. The Court added a caveat, however, that if the employee were found to be employed under an employment-at-will contract, the defendant had the right to terminate his employment at any time, even arbitrarily and capriciously, and the employee could not then maintain an action for negligent evaluation. In Chamberlain v Bissell Inc, 547 F Supp 1067, 1081 (WD Mich, 1982), the Court said that under Michigan law "a duty of ordinary care arises from the performance of a contractual obligation.” While a complete failure to perform a contractual obligation would give rise only to a breach of contract, negligent performance of the obligation is also actionable in tort. The Court found that because the defendant had a contractual obligation to conduct performance reviews under an implied just-cause contract, and it actually performed those reviews, it had a duty to use ordinary or reasonable care in performing those reviews. The Court said: Count ii of [the employee’s] complaint [for negligent evaluation] does not allege a breach of duty distinct from the alleged breach of the employment contract. Although [the employee] contends that defendant was contractually obligated according to the employee information handbook to properly evaluate his work performance, if those evaluations were indeed negligently compiled, then defendant would not have performed its obligation under the contract which would constitute a breach of the contract. If defendant then discharged [the employee] based upon the negligently compiled or inaccurate evaluations, then defendant would have breached its duty to discharge [the employee] only for good cause, which is a basis for a breach of contract action. [Loftis v GT Products, supra, pp 798-799.] Mitchell v General Motors Acceptance Corp, 176 Mich App 23; 439 NW2d 261 (1989) (no claim for negligent evaluation because the employee did not plead that gmac breached any duty independent of the alleged breach of contract); Squire v General Motors Corp, 174 Mich App 780; 436 NW2d 739 (1989) (since the tort claim for negligent evaluation arose from the same breach of duty upon which the employee’s contract claim was based, it was not a valid independent tort action); Grant v Michigan Osteopathic Medical Center, 172 Mich App 536; 432 NW2d 313 (1988) (the employee’s purported negligence claim did not state a distinct and separate cause of action from her breach of contract claim); Dahlman v Oakland Univ, 172 Mich App 502; 432 NW2d 313 (1988) (the defendant would not have evaluated the employee if the employee did not have an employment contract; therefore, there was no breach of duty to evaluate separate and distinct from a breach of contract); Sankar v Detroit Bd of Ed, 160 Mich App 470; 409 NW2d 213 (1987) (the actions complained of and characterized as a tort of negligent evaluation arose exclusively from a duty created under the collective bargaining agreement); Struble v Lacks Industries, Inc, 157 Mich App 169; 403 NW2d 71 (1987) (the employee was merely asserting that the defendant negligently fired her by breaching contractual promises arising from the defendant’s policies and procedures governing discipline; the facts were evidence in support of a breach of contract claim, but did not establish a separate cause of action in tort); Brewster v Martin Marietta Aluminum Sales, Inc, 145 Mich App 641; 378 NW2d 558 (1985) (because there was no breach of duty distinct from the breach of contract, the employee’s cause of action for negligent discharge arose from a breach of promise or the nonfeasance of a contractual obligation and her action was in contract, not in tort). In Haas v Montgomery Ward, 812 F2d 1015 (CA 6, 1987), the court held that since the employee was evaluated only because of her position, she could not maintain an independent tort action for negligent evaluation causing her discharge. See also Brock v Consoli dated Biomedical Laboratories, 817 F2d 24 (CA 6, 1987) (Michigan does not recognize a cause of action in tort for the negligent performance of a contract); Speckine v Stanwick Int’l, Inc, 503 F Supp 1055 (WD Mich, 1980) (Michigan law is clear in not recognizing a cause of action for tort in a contract setting unless there is a relationship that gives rise to the duty from some source other than the contract itself). Duty is essentially a question of whether the relationship between the actor and the injured person gives rise to any legal obligation on the actor’s part for the benefit of the injured person. [Moning v Alfono, 400 Mich 425, 438-439; 254 NW2d 759 (1977).] Id., p 560. Id., p 565. Id., pp 565-566. In Valentine, supra, p 259, "an action for breach of contract and not a tort action,” this Court af

Defendant Win
Equal Employment Opportunity Commission v. Kloster Cruise Limited, D/B/A Norwegian Cruise Lines
11th CircuitAug 21, 1991
Plaintiff Win
Shuttleworth v. Riverside Osteopathic Hospital
8979Aug 20, 1991Michigan

SHUTTLEWORTH v RIVERSIDE OSTEOPATHIC HOSPITAL Docket No. 121019. Submitted March 11, 1991, at Detroit. Decided August 20, 1991, at 9:40 a.m. Leave to appeal sought. Arlene Shuttleworth and her husband, Kim Shuttleworth, brought an action in the Wayne Circuit Court against the Riverside Osteopathic Hospital, claiming that it terminated her employment because she filed a complaint under the Michigan Occupational Safety and Health Act. The court, Kathleen I. MacDonald, J., granted summary disposition for the defendant, finding that Arlene Shuttleworth had failed to exhaust administrative remedies under the act and had failed to file timely a claim under the Whistleblowers’ Protection Act. The plaintiffs appealed, asserting that a common-law cause of action exists for retaliatory discharge. The Court of Appeals held: 1. No common-law cause of action exists for the discharge of an employee in retaliation for reporting an employer’s violation of law. That right was created by the Whistleblowers’ Protection Act, which requires the timely filing of a claim under that act. 2. An employee must exhaust the administrative remedies provided by the Michigan Occupational Safety and Health Act before commencing a civil action alleging retaliatory termination of employment for the filing of a complaint under that act. Affirmed. 1. Actions — Common-Law Actions — Employment — Retaliatory Discharge. No common-law cause of action exists for retaliatory discharge from employment for reporting an employer’s violation of law. References Am Jur 2d, Master and Servant §§ 43, 48.3, 48.7, 49; Plant and Job Safety-OSHA and State Laws §§ 131,137. Liability for retaliation against at-will employee for public complaints or efforts relating to health and safety. 75 ALR4th 13. Liability for discharge of at-will employee for in-plant complaints or efforts relating to working conditions affecting health or safety. 35 ALR4th 1031. Modern status of rule that employer may discharge at-will employee for any reason. 12 ALR4th 544. 2. Actions — Employment — Retaliatory Discharge — Michigan Occupational Safety and Health Act — Whistleblowers’ Protection Act. An employee whose employment allegedly is terminated in retaliation for filing a complaint against the employer for violations of the Michigan Occupational Safety and Health Act may seek redress under that act or under the Whistleblowers’ Protection Act (MCL 408.1001 et seq., 15.362; MSA 17.50[1] et seq., 17.428[2]). Roy, Shecter & Vocht, P.C. (by Lynn H. Shecter), for the plaintiff. Dickinson, Wright, Moon, Van Dusen & Freeman (by Henry W. Saad and Gary S. Casey), and H. Elliot Parnés, for the defendant. Before: Brennan, P.J., and Michael J. Kelly and D. F. Walsh, JJ. Former Court of Appeals judge, sitting on the Court of Appeals by assignment. Michael J. Kelly, J. Plaintiffs filed the instant lawsuit after plaintiff Arlene Shuttleworth was terminated from her employment by defendant in alleged retaliation for filing a complaint under the Michigan Occupational Safety and Health Act, MCL 408.1001 et seq.; MSA 17.50(1) et seq. The circuit court granted summary disposition pursuant to MCR 2.116(C)(8) in favor of defendant after finding that plaintiff Arlene Shuttleworth had failed to exhaust her administrative remedies under the miosha and had failed to file a timely claim under § 2 of the Whistleblowers’ Protection Act (wpa), MCL 15.362; MSA 17.428(2). Plaintiffs appeal as of right, and we affirm. A motion for summary disposition brought under MCR 2.116(C)(8) tests the legal sufficiency of a claim solely on the basis of the pleadings. All factual allegations made in support of the claim are accepted as true, as well as any reasonable inferences that can be drawn therefrom. The motion is properly granted when the claim is so clearly unenforceable as a matter of law that no factual development could justify a right of recovery. Parkhurst Homes, Inc v McLaughlin, 187 Mich App 357, 360; 466 NW2d 404 (1991). Plaintiffs contend that the trial court erred in finding that the wpa is the exclusive remedy for an employee who has been wrongfully discharged from employment for reporting an employer’s violation of the law. Plaintiffs assert that a common-law cause of action for retaliatory discharge predated the wpa and that, therefore, the remedies are cumulative. We disagree. The wpa provides a remedy to an employee terminated for reporting to any public body a violation of any law or regulation of this state, a political subdivision, or the United States. MCL 15.362; MSA 17.428(2). It is the general rule in this state that when a statute creates a new right or imposes a new duty having no counterpart in the common law, the remedies provided in the statute for its violation are exclusive and not cumulative. Pompey v General Motors Corp, 385 Mich 537, 552; 189 NW2d 243 (1971). This Court in Covell v Spengler, 141 Mich App 76; 366 NW2d 76 (1985), held that no common-law counterpart existed before passage of the wpa and that, therefore, the act is the exclusive remedy for an employee whose employment is terminated in retaliation for reporting an employer’s violation of the law. Plaintiffs have not cited, nor do we find, any common-law counterpart to the wpa. Although plaintiffs maintain that retaliatory discharge actions predated passage of the wpa, they failed to direct this Court to any decision recognizing a common-law right for the type of retaliatory discharge that is now protected by the wpa. The only case that we can locate that held that a cause of action for discharge of an employee in retaliation for reporting an employer’s violation of law existed before enactment of the wpa is Watassek v Dep’t of Mental Health, 143 Mich App 556, 564; 372 NW2d 617 (1985). However, the panel in that case recognized the cause of action only after considering the public policy espoused in the wpa itself. The events at issue in Watassek occurred before the act took effect in 1981, and the panel therefore looked to the statute as evidence that a recognized public policy existed before the statute was enacted. We find that the conclusion in Watassek that there was a preexisting common-law counterpart to the wpa was nothing more than an attempt to give preenactment effect to a statutory right by fabricating a supposed preexisting common-law right wholly from the provisions of the subsequently enacted statute. We therefore decline to hold that a common-law counterpart preexisted the wpa. Lastly, we note that a separate remedy under the miosha was available to plaintiff Arlene Shuttleworth for being terminated in retaliation for filing a complaint or instituting a proceeding under that act. Tyrna v Adamo, Inc, 159 Mich App 592; 407 NW2d 47 (1987). However, before resorting to a civil action, she first must have pursued the administrative remedies contained in the miosha. Schwartz v Michigan Sugar Co, 106 Mich App 471, 480; 308 NW2d 459 (1981). The trial court did not err in finding that plaintiff failed to state a claim. Affirmed.

Defendant Win
Flesner v. Technical Communications Corp.
8825Aug 8, 1991Massachusetts

Jeffrey Flesner vs. Technical Communications Corporation & others. Middlesex. April 1, 1991. - August 8, 1991. Present: Liacos. C.J.. Wilkins. Abrams, Lynch. O’Connor, & Greaney. JJ. Contract, Employment. Employment, Termination. Public Policy. Emotional Distress. Fraud. Privacy. Civil Rights, Termination of employment. Practice, Civil, Summary judgment. Damages, Emotional distress. A cause of action for wrongful discharge in violation of public policy was stated by a plaintiffs allegation that his discharge from employment was motivated by his employer’s desire to interfere with or retaliate for the plaintiffs cooperation with a United States Customs Service investigation [810-811], and where the motive for the discharge was a contested issue, summary judgment was incorrectly entered for the employer [811-812], In a civil action in which the plaintiff sufficiently alleged and supported a claim of misrepresentation the judge incorrectly dismissed the claim. [814] In a civil action based on an allegation of wrongful discharge from employment, the employer’s contention that the plaintiff was precluded from recovering damages because of alleged misrepresentations on his résumé and in his job interview involved disputed issues of material fact not appropriately resolved at the summary judgment stage of the proceedings. [815-817] In a civil action in which the plaintiff claimed damages for invasion of privacy pursuant to G. L. c. 214, § IB, the judge correctly ordered entry of summary judgment for the defendants where the only evidence on the claim was the plaintiffs hearsay testimony or statements of his personal belief. [817-818] In a civil action based on the plaintiffs alleged wrongful discharge by his employer, the plaintiff failed to identify any “secured right” under the Constitution or laws of the Commonwealth or the United States to entitle him to relief on a claim under the Massachusetts Civil Rights Act, G. L. c. 12, § 111, and summary judgment properly entered for the employer on that claim. [818-819] Civil action commenced in the Superior Court Department on January 25, 1985. The case was heard by Robert J. Hallisey, J. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Richard L. Neumeier (Paul M. Moretti with him) for the plaintiff. D. Alice Olsen (Thomas M. Elcock with her) for the defendants. Arnold McCalmont and James McCalmont. Abrams, J. Jeffrey Flesner claims that his former employer, Technical Communications Corporation (TCC), constructively discharged him in retaliation for his cooperation in a United States Customs Service investigation of TCC. A Superior Court judge awarded summary judgment in favor of TCC. Flesner now appeals, contending that the judge erred in dismissing his claims for (1) wrongful discharge; (2) misrepresentation; (3) invasion of privacy; and (4) violation of the Massachusetts Civil Rights Act, G. L. c. 12, § 111 (1990 ed.). In addition, the defendants claim that Flesner is precluded from recovering damages by his own misrepresentations. We transferred the case to this court on our own motion. We reverse the summary judgment on the wrongful discharge and misrepresentation claims. We affirm on the other claims. From the materials submitted to the court in conjunction with the summary judgment motion, the undisputed facts are as follows. TCC is a Massachusetts corporation that produces, develops, and sells internationally communications systems, including communications security systems. Arnold McCalmont and his son, James McCalmont, also defendants, are president and sales manager, respectively. Flesner worked as a salesman for TCC from January 31, 1983, until his resignation on September 1, 1983. Flesner planned a sales trip to Argentina in July, 1983, to demonstrate certain TCC security equipment to potential buyers. He claims that before he left he repeatedly asked James McCalmont whether a temporary export license was needed to transport the equipment to Argentina. McCalmont told Flesner that because he was only demonstrating the equipment rather than making a permanent sale, no such license was required. At the time, TCC had applied for a temporary export license for Argentina but the application was returned with no action taken. On the date of departure, Flesner was met at Logan International Airport in Boston by a TCC employee who delivered the equipment to Flesner and handed him a manila envelope containing Customs documents. Flesner checked the equipment through to Argentina. At a stopover in Miami, Flesner was detained by Customs officials. He handed them the documents that TCC had provided him in the manila envelope, but they did not satisfy the officials. The officials told Flesner that if he did not cooperate, he would be handcuffed and arrested on the spot. Flesner said he would cooperate. The officials further questioned Flesner for approximately two and one half hours about TCC’s business, and Flesner’s planned Argentina trip. Afterward, he was told to return to Boston the next day, but the equipment was seized. When Flesner arrived back at Logan, he was met by other Customs officials who also told him that he would not be arrested or handcuffed if he cooperated. Again, he was questioned intensively. The officials instructed Flesner not to tell TCC that he was cooperating with them unless asked directly. They then released him. Later that night, Flesner met with the McCalmonts and Herman Wolz, another TCC employee, to relate the events of the past two days. He did not tell them, because they did not ask, that he was cooperating with Customs. The Customs agents met with Flesner several times after the incident to ask further questions. They also interviewed Arnold McCalmont. At one point, Flesner was summoned to a meeting with Arnold McCalmont and TCC’s lawyer at which Flesner informed them that he was cooperating with Customs. The lawyer advised Flesner that they might become adversaries and that Flesner should watch what he said to them. Flesner claims that the employer-employee relationship deteriorated thereafter. He asserts that he was forbidden to travel until the investigation was cleared up, and that he was not allowed to telephone or telex potential customers. All of his correspondence was to be reviewed by Wolz, and little, if any, of it was approved for mailing. Because he was denied access to his customers, he asserts that he was prevented from making sales or earning commissions, although he had not made any sales prior to the incident either. On August 31, 1983, Flesner told Arnold McCalmont and Wolz that he had met with Customs agents the previous week. Wolz told Flesner to inform them of any further contacts with Customs. Later, Flesner asked Wolz about his future with TCC. Wolz’s response was not positive. He told Flesner that he should resign so that he could receive two weeks’ severance pay or he would be fired the next day. On September 1, 1983, Flesner tendered his resignation. In January, 1985, Flesner filed an eight-count complaint against the defendants. TCC counterclaimed for misrepresentation. In September, 1989, the defendants moved for summary judgment on Flesner’s claims. On September 27, 1989, the judge allowed the motion except as to the counts for misrepresentation, wrongful discharge, and negligence. In October, he allowed the motion for all counts, and filed a memorandum of decision explaining his order. Flesner appeals the order as to five of those counts. 1. Motion for summary judgment. In ruling on a motion for summary judgment, “a judge . . . must consider ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,’ in determining whether summary judgment is appropriate. Mass. R. Civ. P. 56 (c), 365 Mass. 824 (1974). The burden on the moving party is to ‘show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.’ Id.” Madsen v. Erwin, 395 Mass. 715, 719 (1985). This burden need not be met by affirmative evidence negating an essential element of the plaintiff’s case, but may be satisfied by demonstrating that proof of that element is unlikely to be forthcoming at trial. See Kourouvacilis v. General Motors Corp., ante 706 (1991). Where a moving party properly asserts that there is no genuine issue of material fact, “the judge must ask himself not whether he thinks the evidence unmistakably favors one side or the other but whether a fair-minded jury could return a verdict for the plaintiff on the evidence presented.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). A judge’s mere belief that the movant is more likely to prevail at trial is not a sufficient basis for granting summary judgment. See Byrd v. Roadway Express, Inc., 687 F.2d 85, 87 (5th Cir. 1982); American Int’l Group v. London Am. Int’l Corp. Ltd., 664 F.2d 348, 351 (2d Cir. 1981). 10A C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure § 2725, at 104-105 (1983). In cases where motive, intent, or other state of mind questions are at issue, summary judgment is often inappropriate. See Pederson v. Time, Inc., 404 Mass. 14, 17 (1989) (“the generally accepted rule is that the ‘granting of summary judgment in a case where a party’s state of mind . . . constitutes an essential element of the cause of action is disfavored’ ”), quoting Quincy Mut. Fire Ins. Co. v. Abernathy, 393 Mass. 81, 86 (1984). See also Sweat v. Miller Brewing Co., 708 F.2d 655, 657 (11th Cir. 1983); Baldini v. Local 1095, UAW, 581 F.2d 145, 151 (7th Cir. 1978). 10A C. Wright, A. Miller, & M. Kane, supra at § 2730. In such cases, “[mjuch depends on the credibility of the witnesses testifying as to their own states of mind. In these circumstances, the jury should be given an opportunity to observe the demeanor, during direct and cross-examination, of the witnesses whose states of mind are at issue.” Croley v. Matson Navigation Co., 434 F.2d 73, 77 (5th Cir. 1971). With these principles in mind, we consider the merits of Flesner’s arguments. 2. Wrongful discharge. Flesner claims that TCC constructively discharged him in violation of public policy because of his cooperation with the Customs officials. We have recognized an exception to the traditional doctrine that at-will employees may be discharged for any reason or no reason at all, where the discharge is for reasons that violate public policy. See DeRose v. Putnam Management Co., Inc., 398 Mass. 205 (1986). We have held, for example, that a cause of action will lie when an employee is fired for disobeying the employer’s instruction to testify falsely at a trial, see id., or for enforcing safety regulations for which she was responsible, see Hobson v. McLean Hosp. Corp., 402 Mass. 413 (1988). In Smith-Pfeffer v. Superintendent of the Walter E. Fernald State School, 404 Mass. 145, 149-150 (1989), we stated that 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).” Flesner claims he was discharged for cooperating with the Customs officials. The law did not require him to cooperate; he had the right to remain silent. Nevertheless, it is the public policy of this Commonwealth to encourage cooperation with ongoing criminal investigations. See, e.g., G. L. c. 262, § 29 (1990 ed.) (providing compensation and travel costs reimbursement for any person who attends the Attorney General or the offices of a district attorney for the purpose of assisting an investigation); G. L. c. 233, § 20D (1990 ed.) (permitting a grant of immunity for specified crimes for witnesses in a grand jury investigation); Correllas v. Viveiros, ante 314 (1991). Cf. 18 U.S.C. § 6002 (permitting a grant of immunity to witnesses testifying or providing information in a proceeding ancillary to an agency of the United States). We think that the reasons for imposing liability in the categories of cases set forth in Smith-Pfeffer also justify legal redress in certain circumstances for employees terminated for performing important public deeds, even though the law does not absolutely require the performance of such a deed. In such a situation, as in the Smith-Pfeffer categories, allowing the employer to terminate employees for reasons that directly contradict the public policy of the Commonwealth would seriously impair that policy. See Petermann v. International Bhd. of Teamsters, 174 Cal. App. 2d 184 (1959). Cooperating with an ongoing governmental investigation is an important public deed which fits this category. See Palmateer v. International Harvester Co., 85 Ill.2d 124 (1981) (cause of action stated where plaintiff claims he was discharged in retaliation for supplying information to law enforcement agency that a fellow employee might have committed a crime and for agreeing to assist in the investigation and trial). The judge, however, granted summary judgment because “TCC never urged Flesner not to cooperate with Customs officials or otherwise hamper an investigation.” This assertion does not demonstrate an absence of evidence on an essential element of the claim. See Kourouvacilis, supra. Flesner’s claim is that the discharge itself was motivated by a desire to interfere with or retaliate for his cooperation with the investigation. Such intentional interference, if found by a jury, would constitute a wrongful discharge in violation of public policy. Moreover, the judge asserted that, while “Flesner may be said to have been fired for participating in an illegal scheme in which the employer was involved, . . . such a termination does not fall within the public policy exception.” Although a reasonable jury may conclude that such was the cause for Flesner’s termination, it would not be required to so con-elude. Where a jury can draw opposite inferences from the evidence, summary judgment is improper. See Anderson v. Liberty Lobby, Inc., supra at 248-250. Flesner’s deposition asserts that he asked about export licenses and TCC told him they were not necessary. Thus, it is permissible to conclude that Flesner left on his trip completely unaware that he was acting in violation of the law. *He describes his ongoing cooperation with Customs authorities and a corresponding deterioration in his working relationship with TCC. He asserts that he was told to resign with two weeks’ pay or be fired. This evidence sufficiently raises a question of material fact as to whether Flesner was discharged in retaliation for his cooperation with a law enforcement investigation. The defendants contend that Flesner was discharged, if at all, for other legitimate business reasons. Thus, the motive for the discharge is a primary contested issue of fact. In such circumstances, the grant of summary judgment on these claims was improper. See Sweat v. Miller Brewing Co., supra (where employer’s intent in discharging plaintiff was contested, summary judgment was improper); Padway v. Palches, 665 F.2d 965, 967 (9th Cir. 1982) (same). 3. Damages. In addition to economic damages, Flesner claims damages for emotional distress and mental anguish as well as punitive damages.* * Punitive damages are not allowed in this Commonwealth unless expressly authorized by statute. See Santana v. Registrars of Voters of Worcester, 398 Mass. 862, 867 (1986); USM Corp. v. Marson Fastener Corp., 392 Mass. 334, 353 (1984). Because no such legislative authorization applies to this case, Flesner’s claim for punitive damages cannot stand. Because the judge ordered summary judgment for the defendants on liability for the wrongful discharge count, he did not decide whether such a cause of action gives rise to tort damages, such as those for emotional distress claimed by Flesner, in addition to contract damages. There is, therefore, no ruling before us to review. The parties focused on liability in the motion for summary judgment. Therefore, the factual background on damages is undeveloped. Indeed, no facts alleged in the complaint or submitted on summary judgment evidence any suffering by Flesner of mental anguish due to the defendant’s conduct in wrongfully discharging him. We decline to adopt a hard and fast rule on whether tort damages in general and emotional distress damages in particular are recoverable in wrongful discharge cases in the absence of a well-developed factual record. See Hobson v. McLean Hosp. Corp., 402 Mass. 413, 417 n.3 (1988). If at trial no facts are brought out supporting damages for emotional distress due to the defendant’s intentional conduct, then the question need not be reached. We therefore decline to address this issue. 4. Misrepresentation. The judge also granted summary judgment on Flesner’s misrepresentation claim because the complaint did not allege damages independent of those alleged in connection with the termination of his employment. “Therefore,” according to the judge, the “plaintiffs cause of action, if one lies, must be for Wrongful Discharge.” Even if the judge were correct that the only damages Flesner alleges are those arising out of his termination, a point we do not decide, the overlap does not justify dismissal of the claim. Flesner, of course, cannot recover double damages for the two claims, but he is entitled to proceed on more than one theory of recovery. See Whitinsville Plaza, Inc. v. Kotseas, 378 Mass. 85, 89 (1979); Laurendeau v. Kewaunee Scientific Equip. Corp., 17 Mass. App. Ct. 113, 120-121 (1983). Mass. R. Civ. P. 8 (e) (2), 365 Mass. 749 (1974). The judge does not conclude that Flesner insufficiently alleged or supported his claim of misrepresentation. Summary judgment should not have been allowed on the misrepresentation claim. Cf. Presto v. Sequoia Sys., Inc., 633 F. Supp. 1117 (D. Mass 1986) (claims for breach of employment contract and misrepresentation allowed to go forward; wrongful discharge claim dismissed on other grounds). 5. Flesner’s alleged misrepresentation. The defendants argue that Flesner is precluded from recovering damages because he misrepresented several facts on his résumé and in his job interview leading to his employment with TCC. According to the defendants, TCC would not have hired Flesner had they known these representations were not true. Therefore, they conclude that even though they did not discover these misrepresentations until after Flesner resigned, he cannot recover any damages because TCC would have been justified in firing him even absent any wrongful motives. Because the judge ordered summary judgment for the defendants on all counts, he did not reach this issue. The defendants cite a line of Federal wrongful discharge and employment discrimination cases in support of their argument. See, e.g., East Texas Motor Freight Sys., Inc. v. Rodriguez, 431 U.S. 395 (1977); Mt. Healthy City School Dist. Bd. of Educ. v. Doyle, 429 U.S. 274 (1977); Summers v. State Farm Mut. Auto. Ins. Co., 864 F.2d 700 (10th Cir. 1988); Smallwood v. United Airlines, Inc., 728 F.2d 614 (4th Cir.), cert, denied, 469 U.S. 832 (1984); Murnane v. American Airlines, 667 F.2d 98 (D.C. Cir.), cert, denied, 456 U.S. 915 (1982). These cases all deal with the question of the appropriate remedy once discrimination or a wrongful discharge has been established. In Mt. Healthy, a teacher was fired, in part because of his exercise of rights secured him by the First Amendment to the United States Constitution. Several other permissible reasons could have supported the discharge, however. The Supreme Court remanded the case to the District Court to determine whether the school board in fact would have fired the plaintiff even absent the impermissible reason. The court reasoned that the plaintiff should not be put in a better position than he would have been in had the wrong not b

Mixed Result
Rowe v. Montgomery Ward & Co.
8790Jul 31, 1991Michigan

ROWE v MONTGOMERY WARD & CO, INCORPORATED Docket No. 84848. Argued October 2, 1990 (Calendar No. 3). Decided July 31, 1991. Dissenting opinion by Levin, J., filed August 2, 1991. Mary Rowe brought an action in the Kent Circuit Court against Montgomery Ward & Co., Incorporated, alleging wrongful discharge and breach of a contract not to terminate her employment except for cause. The court, Roman J. Snow, J., entered judgment on a jury verdict for the plaintiff. Thereafter, the defendant’s motions for judgment notwithstanding the verdict, a new trial, or remittitur were denied. The Court of Appeals, Maher, P.J., and L. F. Simmons, J. (Gribbs, J., dissenting), reversed in an unpublished opinion per curiam, finding that the plaintiff was an employee at will (Docket No. 93817). The plaintiff appeals. In an opinion by Justice Riley, joined by Justices Brickley and Griffin, and an opinion by Justice Boyle, the Supreme Court held: The plaintiff may not maintain an action for breach of contract as a result of her dismissal. Her proofs are insufficient to support her claim of a promise by the defendant, implied in fact, not to terminate her employment except for just cause. 1. Contracts for permanent employment are for indefinite periods of time and are presumed to provide employment at will unless accompanied by distinguishing features or provisions or additional consideration supporting a term of permanent employment. Termination for just cause may be provided in a contract of employment for indefinite duration by express agreement or may arise as a result of an employee’s legitimate expectations grounded in an employer’s policy statements. Contractual implications arising from oral statements are determined on the basis of the meaning reasonable persons might attach to the language, given the circumstances presented. Any _contractual obligation for permanent employment arising from oral representations must be based on more than an expression of an optimistic hope of a long relationship, and the statements clearly must permit a construction which supports the asserted meaning. In this case, objective evidence was lacking to permit a reasonable juror to find implied in fact a promise of termination only for just cause. The employer expressed a policy in general terms with regard to termination, clearly not intending to form a contract for permanent employment. There was no evidence from which reasonable minds could deduce mutual agreement of employment terminable only for cause. References Am Jur 2d, Master and Servant §§ 32, 45. Comment Note — Validity and duration of contract purporting to be for permanent employment. 60 ALR3d 226. 2. The defendant clearly and unambiguously gave the plaintiff reasonable notice of its policy of termination at will in its handbook, distributed in 1983, which modified any prior expectations of termination only for cause and precluded any legitimate expectation by the plaintiff of discharge only for cause. The fact that the plaintiff failed to sign employment-at-will disclaimers was not determinative. Justice Boyle, concurring, stated that where the parties have not supplied a term of duration, employment at will is inferred, but may be overcome by establishing that a contrary inference is more likely. Enforceable obligations arise from explicit promises, from promises implied in fact, or obligations implied in law. Where the communication between the parties has more than one possible meaning, a court will employ its own criteria for interpretation; where the contract fails to provide for a contingency, courts may fill the gaps to avoid failure for indefiniteness. "As long as” may be interpreted either in a temporal or a qualitative sense. It may be read literally, as an obligation to provide lifetime employment, or as an offer of steady employment. Because it is susceptible of either meaning, it cannot be said that the "plain meaning” of the phrase addresses when or how termination will occur or binds the employer for any particular length of time. Where the parties have failed to set forth a material term, the court must interpret language and conduct to determine the parties’ intent. In the employment context, "as long as,” like "lifetime” and "permanent,” are construed as offers of steady employment. In the context of employment arrangements, a promissory theory of liability is analyzed in the light of the presumption of employment at will. Where it is asserted that the proofs are insufficient to create an issue of fact, a claim of a promise implied in fact requires the court to focus on the words or actions of the defendant to determine whether there is sufficient evidence that a reasonable promisee could believe manifested an intention to make a commitment of job security. Because the defendant’s commitment-making actions do not predominate, the decision of the Court of Appeals should be affirmed. Affirmed. Justice Levin, dissenting, stated that the plaintiff’s claim for wrongful. discharge based on an express contract does not depend on Montgomery Ward’s written policy statements or on terms left to inference, but rather on Montgomery Ward’s offer, subject to the Rules of Personal Conduct that enumerated grounds for discharge, to employ her to sell appliances at a stated compensation for as long as she was able to do the work. Because the promise by the employer stated a term of duration and required no performance by the plaintiff ether than that she sell, she could be discharged only for a failure to sell, or for a cause stated in the Rules of Personal Conduct, or for a cause the employer might seek to establish by implication. Contracts with "as long as” durational terms are express contracts. By its terms such a promise is not for permanent or lifetime employment, but rather for employment for a term coextensive with the time that the employee is able to do the work. An offer by an employer to employ a person for stated compensation as long as the person is able to do the work defines clearly, specifically, and unambiguously the work to be done, the compensation to be paid, and the term of the contract, so that the trier of fact may find, upon acceptance, an express contract of employment was formed for as long as the employee is able to do the work. Because the contract provides a method for determining the length of the engagement, the duration of the contract is determinable. The duration is sufficiently definite, even though it is uncertain how long the employee will be able to do the work. The promise to provide the employee with work at a stated compensation for as long as the employee is able to do the work is express, not implied, overcoming a presumption of employment at will. The correct focus is not on what the promisor actually intended, but on what a reasonable promisee would conclude the offer meant. The question whether the words used by the parties are sufficient to support a finding of a contract of employment does not depend on whether the words are in writing or are expressed orally. There is no rule of law requiring objective support in the form of a manual or other writing, or other corroborative evidence for an oral term of a contract of employment. A term of duration of an employment contract is not negated, as a matter of law, by evidence that the employee when hired did not inquire about or negotiate for job security, or by evidence that the employee was seeking a sales position rather than a singular, executive job position. Chief Justice Cavanagh, dissenting, stated that the relevant issue regarding the terms of the plaintiff’s oral employment contract, including the durational or job security term, is what terms in fact were agreed to, not how or whether they were negotiated. To the extent that objective support for the express oral contract is relevant, such factors support the plaintiff. The majority’s newly invented requirement of objective support for an express oral employment contract from policy manuals or statements alters and misapplies the holding and reasoning in Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980), and its companion case, Ebling. While it is true that Toussaint was given a manual specifically providing termination only for just cause, it was not relied on to support the existence of the oral contract providing termination only for just cause, but was relevant only to his separate claim that his dismissal without cause was barred by the legitimate expectations created by the manual. Whether two parties, by express oral statements, have entered into a contract providing termination only for just cause is a question of fact for the jury. That determination should not be disturbed unless, considering the record in the light most favorable to the verdict, there is neither competent nor sufficient evidence from which reasonable minds could reach the jury’s conclusion. In this case, the oral contract enjoys sufficient factual support to justify the jury’s verdict. For all relevant and dispositive purposes, this case is legally and factually indistinguishable from Toussaint. Justice Mallett took no part in the decision of this case. Master and Servant — Employment at Will — Termination for Cause — Implied Contracts. Termination for just cause may be provided in a contract of employment for indefinite duration by express agreement or may arise as a result of an employee’s legitimate expectations grounded in an employer’s policy statements; contractual implications arising from oral statements are to be determined on the basis of the meaning reasonable persons might attach to the language, given the circumstances presented; any contractual obligation for permanent employment arising from oral representations must be based on more than an expression of an optimistic hope of a long relationship and the statements clearly must permit a construction which supports the asserted meaning. Meana, Spruit & Bedevia, P.C. (by Richard M. Spruit), for the plaintiff. Dykema, Gossett (by Charles C. DeWitt, Jr.) for the defendant. Amici Curiae: Mark Granzotto, Monica Farris Linkner, and Charles P. Burbach for the Michigan Trial Lawyers Association. Clark, Klein & Beaumont (by Dwight H. Vincent, J. Walker Henry, and Rachelle G. Silberberg) for Michigan Manufacturers Association. Miller, Canñeld, Paddock & Stone (by Diane M. Soubly) for American Society of Employers, Motor Vehicle Manufacturers Association of the United States, Inc., Greater Detroit Chamber of Commerce, and Michigan State Chamber of Commerce. Riley, J. In Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), this Court joined the forefront of a nationwide experiment in which, under varying theories, courts extended job security to nonunionized employees. In the vast outpouring of ensuing cases, there are indeed situations in which employers have in reality agreed to limit managerial discretion. However, the theory remains troubling because of those instances in which application of contract law is a transparent invitation to the factfinder to decide not what the "contract” was, but what "fairness” requires. That courts have not been successful in unraveling the logic of the theory to produce principles that distinguish the first category of cases from the second, is not necessarily a reason to abandon the experiment. As Justice Griffin put it in In re Certified Question, Bankey v Storer Broadcasting Co, 432 Mich 438, 457; 443 NW2d 112 (1989), "[fjairness suggests that a discharge-for-cause policy announced with flourishes and fanfare at noonday should not- be revoked by a pennywhistle trill at midnight.” But unless the theory has some relation to the reality, calling something a contract that is in no sense a contract cannot advance respect for the law. Thus, we seek a resolution which is consistent with contract law relative to the employment setting while minimizing the possibility of abuse by either party to the employment relationship. It is in this context that we address the question presented in this appeal: whether an employer’s oral statements and written policy statements created an employment contract terminable only for cause. FACTS AND PROCEEDINGS In August of 1976, plaintiff applied for a sales position at defendant’s North Kent Mall store in Grand Rapids. Plaintiff was interviewed by Mr. Vern Harryman who, according to plaintiff, told her that she would have a job at Montgomery Ward & Co., Incorporated, as long as she achieved her sales quota. With regard to his meeting with plaintiff, Mr. Harryman testified: When we hired commission salespeople, that’s sort of a different type of employee than a time-card person. Their main objective, the number one thing was that they must attain their draw of a hundred and twenty-six dollars a week, and generally, as long as they generated sales and were honest, why, they had a job at Wards, and that’s the way we used to hire our people. At the time of her hiring, plaintiff signed a sheet entitled "Rules of Personal Conduct.” The sheet stated that adherence to company policies would help an employee to achieve "growth, profit, security, [and a] successful career.” The rules further provided that anyone involved in the following activities would be immediately dismissed. Several years later, in January of 1982, defendant issued to all employees a handbook entitled "Welcome to Wards.” The handbook contained disciplinary guidelines which classified infractions according to severity, and allowed four types of discipline for transgression: "1) Written Warning(s); 2) Suspension without Pay; 3) Probation . . . ; and 4) Separation.” In the back of the handbook was a form designated the "New Employee Sign-Off Sheet.” The sheet provided in part: I have read and fully understand the rules governing my employment with Montgomery Ward. I agree to employment with Montgomery Ward under the conditions explained. I understand these conditions can be changed by the Company, without notice, at any time. I also understand and agree that my employment is for no definite period and may, regardless of the time and manner of payment of my wages and salary, be terminated at any time, with or without cause, and without any previous notice. Although a personnel employee informed plaintiff that the sheet was. applicable to her, plaintiff refused to sign the form. Plaintiff claimed that it applied only to new employees, and she did not "feel it’s right that you can fire somebody for no reason, at all.” Plaintiff noted on the back of the sign-off sheet, "Read and do not wish to sign. 5-20-82. [s] Mary Rowe.” Defendant issued another employee handbook to its work force in August of 1982. The August, 1982 handbook also contained an "Employee Sign-off Sheet” providing for termination with or without cause. Plaintiff received but did not sign this sheet. All Montgomery Ward employees, including plaintiff, received another handbook in May of 1983. In the 1983 handbook, there was further language providing for employment at will. Virtually the same disciplinary guidelines were included in all the handbooks. The Court of Appeals opinion aptly describes the facts surrounding plaintiff’s termination. On March 8, 1984, plaintiff was scheduled to work from 1 p.m. to 9 p.m. At 2 p.m., she was observed leaving the store from an unauthorized exit by security personnel. She returned approximately four hours later. Plaintiff did not receive permission to leave the store from her supervisor, although she claimed that she attempted to contact him several times since the previous day but was unable. She did tell her co-workers that she had to leave on an emergency but did not say where she was going or how long she would be gone. Further, even though the salaries of commissioned salespersons are not do. indent upon the hours worked, plaintiff failed t_. punch out when she left or punch in when she returned, as required by company policy. Neither did she make note of her four-hour absence on the time card which she turned in at the end of the work week. Two days later, plaintiff was called into the office of the store manager to answer for the unauthorized absence. She allegedly gave no explanation for leaving the store and refused to provide a written statement on the matter. She said only that she could not remember where she was for those four hours. As a result of this incident, plaintiff was terminated from defendant’s employ. On May 14, 1984, plaintiff filed a complaint against defendant in the Kent Circuit Court asserting claims for wrongful discharge, breach of contract, and several other causes of action which are not relevant for purposes of this appeal. A jury trial on the matter was held on February 18 and 19, 1986. At the conclusion of plaintiff’s proofs, defendant moved for a directed verdict on the ground that she was an at-will employee who was subject to dismissal at any time without cause. The court denied that motion, reasoning that an issue of fact existed for the jury to determine whether there was a just-cause employment contract or whether plaintiff’s employ was terminable at the will of defendant. The trial then continued and eventually concluded in a jury verdict of $86,500 plus interest in favor of plaintiff. A judgment to that effect was thereafter entered by the court. On May 1, 1986, defendant filed motions for judgment notwithstanding the verdict (JNOV), a new trial, or remittitur. By court order dated June 19, 1986, each of those motions was denied.[] Defendant appealed the decision, and the Court of Appeals reversed, finding that plaintiff was an employee at will. Plaintiff appealed in this Court, and we ordered Rowe held in abeyance pending resolution of In re Certified Question, supra, and Bullock v Automobile Club of Michigan, 432 Mich 472; 444 NW2d 114 (1989). On May 2, 1990, this Court granted leave to appeal. 434 Mich 910 (1990). i The issue posed by this case is whether defendant employer’s oral statements and written policy statements directed at plaintiff may be interpreted to permit a promise implied in fact not to terminate except for cause. We find that plaintiff’s allegations are insufficient to support her contention of a promise implied in fact limiting the defendant’s right to terminate her employment. Thus, plaintiff cannot maintain an action for breach of contract as a result of her dismissal. This Court has held that contracts for permanent employment are for an indefinite period of time and are presumptively construed to provide employment at will. Lynas v Maxwell Farms, 279 Mich 684, 687; 273 NW 315 (1937). When contract claims rest on proofs of oral representations, the presumption provides assurance that oral contracts for an indefinite term, which fall outside the statute of frauds, will be recognized only where circumstances suggest both parties intended to be bound. The presumption may be overcome by proof of an express contract for a definite term or a provision forbidding discharge in the absence of just cause, or it may be overcome by proofs which permit a promise implied in fact of employment security, i.e., for a particular period of time or to terminate only for just cause. In Lynas, the Court declined to imply a durational term where the plaintiff accepted an offer of a "permanent lifetime position with the defendant.” The Court observed, however, that the presumption of employment at will can be overcome if a contract is accompanied by "distinguishing features or provisions,” or additional consideration supporting a term of permanent employment. Again, in Toussaint v Blue Cross & Blue Shield of Michigan, supra, p 600, the Court stated that "[b]ecause the parties began with complete freer dom, the court will presume that they intended to obligate themselves to a relationship at will.” In general, parties to an employment contract "remain free to provide, or not to prov

Defendant Win
McDonald v. Stroh Brewery Co.
8979Jul 10, 1991Michigan

McDONALD v STROH BREWERY COMPANY Docket Nos. 107001, 107004, 107005, 107008, 107011. Submitted January 8, 1991, at Detroit. Decided July 10, 1991; approved for publication October 22, 1991, at 9:00 a.m. Leave to appeal sought. John E. McDonald and others brought actions in the Wayne Circuit Court against Stroh Brewery Company, alleging wrongful discharge and employment discrimination based upon age, gender, or national origin. The parties agreed that a single action brought by John Martin would be tried before a jury and that a decision in that case regarding the defendant’s liability would be binding in the other suits. The defendant stipulated that Martin had an implied contract to be dismissed for just cause only; therefore the central issue was whether Martin’s discharge was based upon economic considerations. The court, Robert J. Colombo, Jr., J., entered judgment on a jury verdict of no cause of action. In accordance with the pretrial stipulation, Judge Colombo then entered judgments of no cause of action in all of the cases. The appeals were consolidated. The Court of Appeals held: 1. The trial court did not abuse its discretion in excluding proof regarding whether Martin’s dismissal was for just-cause only. The defendant conceded that Martin only could be terminated for just cause, and that fact was not at issue. The plaintiffs were not prejudiced or unfairly surprised by the decision to exclude the evidence. 2. The court did not abuse its discretion in excluding testimony of several witnesses and documents prepared by an "outplacement” firm. The evidence was irrelevant, cumulative, based on mere speculation, or lacked a proper foundation. References Am Jur 2d, Civil Rights §§ 233, 507; Job Discrimination §§ 98 et seq., 1337 et seq., 2109-2121, 2178. Application of State law to age discrimination in employment. 96 ALR3d 195. Proving that discharge was because of age, for purposes of Age Discrimination in Employment Act (29 USCS §§ 621 et seq.). 58 ALR Fed 94. 3. The jury instructions adequately and fairly presented the parties’ theories of the case and the applicable law. 4. The trial court’s response to a question asked by the jury during its deliberations was complete and fair to both parties and did not mislead the jurors. 5. The Court of Appeals lacks jurisdiction to review whether the trial court could hold the plaintiffs jointly and severally liable for aggregate mediation sanctions. The plaintiffs did not file claims of appeal with regard to that order. Affirmed. 1. Master and Servant — Employment Contracts — Age Discrimination — Burden of Proof — Bona Fide Economic Reasons for Discharge. A plaintiff alleging age discrimination in employment must prove by a preponderance of the evidence that it was a determining factor in the decision to discharge; if the defendant articulates a legitimate explanation for the termination, the burden of proof shifts to the plaintiff to show that economic reasons were a mere pretext; although the economic reasons must be bona fide, they need not rise to the level of a necessity; the jury is to decide only the reasonableness of the defendant’s conduct and not substitute its judgment for the defendant’s business judgment. 2. Master and Servant — Employment Contracts — Termination for Just Cause. A bona fide economic reason may provide just cause to terminate an employee whose contract provides for dismissal for just cause only. Conway, Bogdanski & Wright (by Daniel J. Wright and Michael A. Conway), for the plaintiffs. Butzel Long (by Philip J. Kessler, Virginia F. Metz, and David B. Calzone), for the defendant. Before: Jansen, P.J., and Wahls and Reilly, JJ. Per Curiam. Plaintiffs appeal as of right from judgments of no cause of action entered by the Wayne Circuit Court regarding their various claims against defendant for wrongful discharge and employment discrimination based upon age, sex, or national origin. We affirm. i Defendant, a regional brewery, discharged eighty-seven of its approximately four hundred employees on November 16, 1981, allegedly because of economic pressures occasioned by increased marketing, production, and transportation costs and loss of market share to the two largest national breweries. The terminations followed a poor earnings performance during the preceding fiscal year and was part of a reorganization effort to reduce defendant’s work force without a corresponding decrease in production or efficiency. Before notifying the affected employees, defendant consulted with legal counsel, who assured it that the terminations would not violate the company’s affirmative action program or its equal employment opportunity policy. After discharging the employees, a "bridge” program, which provided assistance in obtaining new employment and paid long-term employees their salaries and benefits for upward of six months, was implemented. Several months after the terminations, defendant acquired the Schlitz Brewing Company for $510 million, of which two-thirds was borrowed and one-third financed using Schlitz’s own assets. The acquisition makes defendant the third largest national brewery and was intended to position it as an effective competitor in the national market. Plaintiffs-appellants, and others who are not parties to these appeals, filed separate actions against defendant in the Wayne Circuit Court, pleading wrongful discharge and employment discrimination. Because of the numerous individual suits filed, the parties agreed that a single action— that of John Martin — would be tried before a jury and that a decision in that case regarding defendant’s liability would be binding in the other suits. Before trial, defendant stipulated that Martin had an implied contract to be dismissed for just cause only. Defendant therefore filed a motion in limine to exclude evidence regarding the nature of the employment contract. Martin objected, arguing that the evidence would be reflective of defendant’s credibility and that its exclusion would prevent the jury from considering the proofs in their entirety. Finding that the evidence would not be material to a disputed issue and would cause needless delay and confusion, the trial court granted defendant’s motion to exclude the evidence. Thus, the central issue to be litigated was whether the termination of Martin’s employment was based upon economic considerations. At the trial, which lasted three weeks, dozens of witnesses testified and numerous exhibits were submitted. Through his proofs, Martin attempted to show that the economic necessity defense was a mere pretext, as evidenced by, among other things, defendant’s ability to afford the expensive "bridge” program and to acquire the Schlitz Brewing Company. Martin asserted that he was discharged without cause and was discriminated against because of his age. However, the jury was not persuaded. After hearing testimony regarding defendant’s financial condition, the circumstances of the Schlitz acquisition, and defendant’s efforts to reduce operating expenses and become competitive at a national level, the jury returned a verdict of no cause of action. In accordance with the pretrial stipulation, judgments of no cause of action were thereafter entered in all the cases. This review is a consolidation of appeals brought by five of the aggrieved plaintiffs. n On appeal, plaintiffs first claim that the trial court abused its discretion in excluding proof of Martin’s just-cause employment contract with defendant. We disagree. The decision whether to admit or exclude evidence is within the sound discretion of the trial court and will not be disturbed on appeal absent an abuse of discretion. Kochoian v Allstate Ins Co, 168 Mich App 1, 12; 423 NW2d 913 (1988). Generally, relevant evidence is admissible, while irrelevant evidence is not. MRE 402. Evidence is relevant if it tends to make the existence of a fact at issue in the action more or less probable than it would be without the evidence. MRE 401. Relevant evidence may be excluded from trial if its probative value is substantially outweighed by the risk of unfair prejudice, confusion of the issues, waste of time, or misleading the jury. MRE 403; Bartlett v Sinai Hosp of Detroit, 149 Mich App 412, 417; 385 NW2d 801 (1986). Here, because defendant conceded that Martin could be discharged for just cause only, that fact was not at issue in the case. Hence, the evidence would not have made the existence of a fact at issue more or less probable than it would have been without the evidence. Even if relevant, the evidence was properly excluded because its probative value was substantially outweighed by the danger that it might confuse the jurors with regard to the issue at hand (i.e., whether the termination was based upon economic considerations). Moreover, admission of the evidence would have resulted in additional expense and delay to an already lengthy trial. And, this is not a situation where the concession failed to cover all facets of a material issue. See Gutowski v M & R Plastics & Coating, Inc, 60 Mich App 499, 515; 231 NW2d 456 (1975). In a collateral argument, plaintiffs also claim that defendant’s concession of the just-cause issue changed the order of proofs and resulted in unfair surprise. We can perceive no prejudice to plaintiffs. The motion in limine was made before trial and with enough time for both parties to file briefs concerning the matter. Plaintiffs cannot complain that they were unfairly surprised by the court’s decision to exclude the evidence. hi Plaintiffs next claim that the court abused its discretion in excluding certain other evidence on grounds of being irrelevant or cumulative. This evidence included testimony that Martin was refused reemployment in 1982, when defendant was hiring new employees; testimony that a younger employee assumed some of Martin’s job responsibilities in 1983; documents prepared by an "outplacement” firm hired by defendant to administer the "bridge” program; testimony of a former controller of the defendant speculating about the cost of the "bridge” program; and testimony of a former vice president of the defendant regarding the economic necessity of the terminations. We do not believe the court abused its discretion in excluding this evidence. Kochoian, supra. Testimony about events that occurred after the Schlitz acquisition was properly excluded because defendant’s financial condition had changed substantially in comparison with the conditions that existed at the time of the terminations. Only the latter time period was relevant to the crucial issue whether Martin’s discharge was due to economic considerations or discriminatory intent. See Gallaway v Chrysler Corp, 105 Mich App 1, 9; 306 NW2d 368 (1981). Thus, the evidence was properly excluded on the ground that it was not probative of defendant’s reason for the termination. MRE 402. The documents prepared by the outplacement firm regarding the services and costs of the "bridge” program were also properly excluded because Martin’s witness was unable to testify that the documents were ever forwarded to, or seen by, defendant. Absent proof that defendant adopted or ratified the services and costs described in the documents, their relevancy had not been established by a proper foundation. The cases cited by plaintiffs are not persuasive because they involved hearsay, not foundational, objections. See Valenti v Mayer, 301 Mich 551; 4 NW2d 5 (1942); Arnsteen v US Equipment Co, 52 Mich App 177; 217 NW2d 61 (1974). Moreover, even if the evidence were improperly excluded, reversal would not be required because other competent evidence was admitted from which the jury could infer the costliness of the "bridge” program. MRE 403. Exclusion of testimony of defendant’s former controller with regard to the cost of the "bridge” program was also proper. By the controller’s own admissions, he could not render an informed opinion regarding the cost of the program. The amount estimated by the controller was based on mere speculation and, therefore, was properly stricken. Harrison v Grand Trunk WR Co, 162 Mich App 464, 469; 413 NW2d 429 (1987). Lastly, the trial court properly excluded the continuing testimony of defendant’s former vice president regarding the economic necessity of the terminations. Before the point of exclusion, the witness’ testimony was entirely consistent with that of several prior witnesses. Plaintiffs have not shown that the excluded testimony would have been other than cumulative. MRE 403; Wayne Co Sheriff v Wayne Co Bd of Comm’rs, 148 Mich App 702, 710-711; 385 NW2d 267 (1983). IV Plaintiffs next contend that the trial court erroneously instructed the jury that defendant should prevail if the terminations were based on a bona fide economic reason without requiring economic necessity. Allegedly, those instructions were improper because they permitted the jury to discount Martin’s age discrimination proofs and find for defendant even if the terminations were based merely on the desire for profit and expansion, not economic hardship. We disagree. When viewed as a whole, and not in a piecemeal and isolated fashion, the instructions adequately and fairly presented to the jur> the parties’ theories of the case and the applicable law. Wiegerink v Mitts & Merrill, 182 Mich App 546, 548; 452 NW2d 872 (1990). The jury was apprised that Martin had to prove, by a preponderance of the evidence, that age discrimination was a determining factor in the decision to discharge him. Meeka v D & F Corp, 158 Mich App 688, 692; 405 NW2d 125 (1987). Further, the jury was told that if defendant articulated a legitimate explanation for the termination, the burden of proof shifted back to Martin to show that the economic reasons were a mere pretext. Id. Although the economic reasons must be bona fide, there is no requirement that they rise to the level of a "necessity.” See McCart v J Walter Thompson USA, Inc, 437 Mich 109, 114-115; 469 NW2d 284 (1991); Friske v Jasinski Builders, Inc, 156 Mich App 468, 472; 402 NW2d 42 (1986). Next, the jury was essentially instructed that a bona fide economic reason for the discharge constituted "just cause” under Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980). This was an appropriate charge. McCart, supra, p 114. Finally, the jury was properly advised that it was to decide only whether defendant’s conduct was reasonable and not to substitute its judgment for defendant’s business judgment. SJI2d 105.03. v During deliberations, the jury asked whether any exhibits had been introduced concerning a change in defendant’s termination policy. There was none, and the court so responded. Over Martin’s objection, the court refused to explain that the only evidence of the policy was presented through oral testimony. Plaintiffs now claim that the court failed to fully and fairly respond to the jury’s inquiry. We find no error. Clearly, the jury’s request concerned only an exhibit regarding the policy, not any testimony thereon. The court’s response was complete and fair to both parties and did not mislead the jurors into believing that no evidence of the policy was admitted at trial. See Rumptz v Leahey, 26 Mich App 438, 444; 182 NW2d 614 (1970). VI For their final issue, plaintiffs challenge the trial court’s order making them jointly and severally liable for aggregate mediation sanctions. Because plaintiffs did not file claims of appeal with regard to that order, this Court is without jurisdiction to review the issue. Eriksen v Fisher, 166 Mich App 439, 450-451; 421 NW2d 193 (1988). Affirmed.

Defendant Win
Korb v. Raytheon Corp.
8825Jul 8, 1991Massachusetts

Lawrence J. Korb vs. Raytheon Corporation. Middlesex. March 7, 1991. - July 8, 1991. Present: Liacos. C.J.. Wilkins. Abrams. Nolan. & Lynch. JJ Public Policy. Employment, Termination. Constitutional Law, Freedom of speech and press. Civil Rights, Termination of employment. In a civil action, summary judgment was correctly entered for the defendant, where no public policy was violated by the defendant’s discharge of its at-will employee who had rendered himself ineffective as the defendant’s spokesperson by publicly expressing views in direct conflict with the economic interest of the defendant [584], nor in that circumstance was there any improper interference with the rights secured to the plaintiff employee by the State Civil Rights Act, G. L. c. 12, § 111 [585], Civil action commenced in the Superior Court Department on December 8, 1987. The case was heard by Robert J. Hallisey, J., on a motion for summary judgment. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Jonathan Shapiro (John Reinstein with him) for the plaintiff. Sandra L. Lynch for the defendant. James M. Shannon, Attorney General, & Stephen A. Jonas, Deputy Attorney General, for the Commonwealth, ami-cus curiae, submitted a brief. Abrams, J. Lawrence J. Korb was dismissed from his position as vice president for Washington operations of Raytheon Corporation because he publicly expressed views in direct conflict with the corporation’s economic interest. He appeals from a summary judgment ordered in Raytheon’s favor denying his claims for wrongful discharge and for a violation of the State Civil Rights Act, G. L. c. 12, § 111 (1990 ed.) (SCRA). We affirm. From 1981 to 1985, Korb served with th¿ United States Department of Defense as assistant secretary of defense for manpower, installations, and logistics. After leaving government service, Korb was hired by Raytheon as vice president in charge of Washington operations. In this position Korb was responsible for congressional relations and acted as a liaison with various government departments, including the Department of Defense. Raytheon’s president told Korb that the company wanted him to be a visible public person in Washington. In December, 1985, with Raytheon’s permission, Korb joined the executive board of the Committee for National Security (CNS), a nonprofit organization dedicated to informing the public about issues of national security and the prevention of nuclear war. On February 25, 1986, CNS held a press conference in a Senate office building during Korb’s normal lunch hour in connection with the release of its annual alternative defense budget. Korb spoke at the press conference. An article in the Washington Post newspaper the day after the press conference reported on the event. The article described Korb as a former assistant secretary of defense “[n]ow a private citizen working for arms maker Ray-theon Co.” It stated that at the press conference, Korb was critical of increased defense spending and urged a scaling back of the 600 ship, fifteen carrier group Navy supported by the Secretary of the Navy. As a result of the article, two Navy officials and a staff member of the Senate Armed Services Committee telephoned Raytheon officials to express their disapproval of Korb’s reported remarks. Air Force officials also complained to Raytheon. Korb was immediately summoned to Ray-theon’s headquarters in Lexington, Massachusetts, and informed that his job was in jeopardy. Korb agreed to write a letter to the editor of the Washington Post clarifying his statements. The Washington Post published the letter on March 4, 1986, under the heading, “We Need More Money for Defense.” Nevertheless, on March 12, 1986, Raytheon officials told Korb that he would be terminated from his position as vice president for Washington operations effective March 31 because of the Navy, Air Force, and Armed Services Committee objections. They informed him that, if he resigned voluntarily he could remain on the payroll as a “special advisor” until August 31, 1986. As a condition of this position, he would be required to obtain approval for all public speeches and would not be permitted to give interviews to the media. Later in March, Raytheon offered, as an alternative to termination, reassignment to a position as a commercial marketing consultant at a Raytheon subsidiary in Philadelphia, Pennsylvania, where he would not be permitted to deal with the Department of Defense. According to Korb, the Philadelphia job was inferior to his Washington position in salary, benefits, tenure, status, and responsibility. In December, 1987, Korb filed a complaint in the Superior Court alleging wrongful termination in bad faith and for reasons that violated the public policy of the Commonwealth. He also alleged that Raytheon interfered by threats, intimidation, and coercion with rights secured by the Constitution and the laws of the United States and of the Commonwealth of Massachusetts in violation of the SCRA. Raytheon removed the case to Federal District Court pursuant to 28 U.S.C. § 1441 (1988). Korb then amended his complaint, deleting any references to the Constitution or laws of the United States. On February 15, 1989, the Federal District Court remanded the case to the Superior Court on the ground that it did not raise a Federal question. In December, 1989, a judge of the Superior Court, treating Raytheon’s motion to dismiss as a motion for summary judgment under Mass. R. Civ. P. 56, 365 Mass. 824 (1974), see Mass. R. Civ. P. 12 (b), 365 Mass. 754 (1974), entered judgment for Raytheon on both counts. Korb appealed and we transferred the case from the Appeals Court on our own motion. 1. Wrongful discharge. Korb alleges that he was wrongfully terminated in bad faith and in violation of the public policy of the Commonwealth as set forth in art. 16 of the Massachusetts Declaration of Rights. In DeRose v. Putnam Management Co., 398 Mass. 205 (1986), we held that employees at will may recover from employers when they are terminated for reasons that violate public policy. Korb contends that art. 16 embodies a strong public policy supporting freedom of speech, and that Raytheon’s actions interfered with both his right to express himself and the public’s right to hear what he had to say. Korb characterizes the public policy at issue too broadly. His situation is not that of an employee who is fired for speaking out on issues in which his employer has no interest, financial or otherwise. To the contrary, Korb was hired to be the corporation’s spokesperson, and he spoke against the interests of the corporation. The topic was one of acute concern to Raytheon. Regardless of whether Korb believed himself to be acting privately rather than as a Raytheon employee, and regardless of what Korb actually said, the public perception after the press conference was that a Raytheon lobbyist advocated a reduction in defense spending. Raytheon had a financial stake in not advocating that position. Therefore, it determined that Korb had lost his effectiveness as its spokesperson. There is no public policy prohibiting an employer from discharging an ineffective at-will employee. The fact that Korb’s job duties included public speaking does not alter this rule. 2. State Civil Rights Act. Korb also asserts a claim under the State Civil Rights Act, G. L. c. 12, § 111 (1990 ed.) (SCRA). The SCRA provides a remedy when “any person or persons, whether or not acting under color of law, interfere by threats, intimidation or coercion, or attempt to interfere by threats, intimidation or coercion, with the exercise or enjoyment by any other person or persons of rights secured by the constitution or laws of the commonwealth.” G. L. c. 12, § 11H (1990 ed.) (incorporated into G. L. c. 12, § 111). Korb’s SCRA claim cannot stand for the same reason his wrongful discharge claim cannot stand: there is no improper interference with secured rights when an employer fires an at-will employee who has become ineffective. Although Korb has a secured right to speak out on matters of public concern, and he has a right to express views with which Ray-theon disagrees, he has no right to do so at Raytheon’s expense. Korb was hired to be an advocate for Raytheon. After he spoke, he lost his utility as Raytheon’s advocate. Ray-theon therefore determined that, in such circumstances, it would no longer pay him to be its advocate. That business decision was not an interference with any secured rights. Korb is free to express whatever opinions he wishes. Ray-theon need not pay him to do so. Judgment affirmed. Raytheon disputes Korb’s assertion that he was fired, contending instead that he voluntarily resigned. Because we uphold summary judgment in Raytheon’s favor, even accepting Korb’s assertion that he was fired, this disputed factual issue is not material. Furthermore, Raytheon does not contest Korb’s claim that Raytheon’s actions were taken in response to his statements at the press conference. Article 16 states in pertinent part: “The right of free speech shall not be abridged." We emphasize that Korb’s situation does not fall within any public policy that may protect the speech of a whistleblower who speaks against his or her employer’s interest. See Mello v. Stop & Shop Cos., 402 Mass. 555, 560 n.6 (1988). Raytheon is not attempting to suppress Korb’s speech in order to cover up its own wrongdoing. Nor is there any allegation that Raytheon is discharging Korb in an attempt to deprive him of a contractual benefit to which he is otherwise entitled. See Gram v. Liberty Mut. Ins. Co., 384 Mass. 659 (1981); Fortune v. National Cash Register Co., 373 Mass. 96 (1977).

Defendant Win
White v. University of Massachusetts at Boston
8825Jul 3, 1991Massachusetts

Katharine White vs. The University of Massachusetts at Boston & another. Suffolk. March 4, 1991. - July 3, 1991. Present: Liacos. C.J.. Wilkins. Abrams. Nolan. & Lynch. JJ. Anti-Discrimination Law, Prima facie case. Termination of employment, Maternity leave, Sex. Employment, Termination, Discrimination. Practice, Civil, Summary judgment. In a civil action in which the plaintiff claimed she was wrongfully terminated from her employment because of her sex, that the termination was retaliatory due to her filing of discrimination charges, that she was terminated in bad faith, and that another employee had interefered with her advantageous employment relations and violated her civil rights, summary judgment was properly entered for the defendants where the plaintiff failed to demonstrate that she had been terminated, and thus she could not establish a prima facie case on any claim. [556-559] Civil action commenced in the Superior Court Department on October 18, 1988. The case was heard by Elbert Tuttle, J., on a motion for summary judgment. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Wendy A. Kaplan for the plaintiffs. Deirdre Heatwole for the defendants. Alan Clarke. Liacos, C.J. On October 18, 1988, the plaintiff, Katharine White, initiated this action against the defendants, The University of Massachusetts at Boston (University) and Alan Clarke, executive director of the Department of Educational Support Programs at the University. White’s complaint alleged gender discrimination in violation of G. L. c. 151B, § 4 (1988 ed.), and 42 U.S.C. § 2000e-2 (1990). She alleged further that she was wrongfully terminated from a full-time teaching position at the University because of her sex; that there was retaliatory termination due to her filing discrimination charges with the University and with the Massachusetts Commission Against Discrimination (MCAD); that termination of her employment by the University was in bad faith; and that Clarke maliciously interfered with her advantageous employment relations and violated her civil rights. White sought reinstatement in her teaching and counselling position at the University, compensatory damages, and related injunctive relief. On September 12, 1989, the defendants submitted a motion for summary judgment pursuant to Mass. R. Civ. P. 56 (b), 365 Mass. 824 (1974). A judge in the Superior Court granted the motion for summary judgment on all counts and ordered the complaint dismissed. The plaintiff appeals the grant of summary judgment as to the counts of discrimination in employment and retaliation by the University and Clarke, and malicious interference with advantageous employment relations by Clarke. We transferred the appeal to this court on our own motion. We affirm. Facts. The following facts are not in dispute. In 1979, White began working as an English teacher and counselor in the University’s Veterans Education and Training Program (VET Program). When White learned that she was pregnant, in December, 1986, she notified the supervisor of the VET Program, Charles Diggs, and his supervisor, Kevin Bowen, co-director of the University’s Joiner Center for War and Social Consequences. Although the standard period allowed under University policy for maternity leave was eight weeks, White was able to arrange an eight-month leave, during the spring and summer semesters of 1987. White’s then-existing employment contract would expire at the end of the leave of absence, on August 31, 1987. On May 29, 1987, Alan Clarke notified White by letter that he did “not intend to recommend that [her] contract be renewed in its present form” in order “to provide the University with sufficient flexibility to implement the best possible program design.” The notice also provided that White would be “accorded preferential treatment in the filling of whatever positions emerge[d].” In July, White requested a further extension of her leave of absence or, alternatively, a part-time teaching position, through the fall semester, 1987. White’s supervisor approved the request, with reservations, in a letter addressed to Clarke dated August 11, 1987. Clarke responded to White’s request by a letter dated August. 14, 1987. In the letter, Clarke denied the request for part-time employment, but stated that he “lookfed] forward to having [White] rejoin the staff of the Veterans Educational Training Program on a full-time basis.” Unable to arrange for her child’s care prior to September 1, 1987, White did not return to work for the fall semester. In November, 1987, White filed a grievance with the University’s affirmative action office seeking clarification of her job status. On January 11, 1988, White filed a charge of gender discrimination with the Massachusetts Commission Against Discrimination (MCAD) alleging, inter alia, that in June, 1987, Clarke terminated her position without cause or notice. In a letter dated February 25, 1988, Clarke denied ever having terminated White’s position, stating that he offered to renew White’s full-time contract beginning in September, 1987, but she turned the offer down. Clarke’s letter further provided: “To the best of my knowledge, you have no employment status at the University.” Subsequently, White amended her discrimination charge with the MCAD to include a charge of retaliation, alleging that Clarke, by the February 25 letter, terminated her employment at the University because she had filed discrimination charges with the University and the MCAD. Motion for summary judgment. Summary judgment “shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Mass. R. Civ. P. 56 (c), 365 Mass. 824 (1974). On appeal, an “order granting summary judgment against [the non-moving party] thus will be upheld if certain factors converge to convince us that the trial judge was ruling in this case on undisputed facts and, of course, that his rulings were correct as matter of law.” Community Nat’l Bank v. Dawes, 369 Mass. 550, 556 (1976). We view the evidence and the inferences to be drawn therefrom in the light most favorable to the opposing party. Id. at 559 n.8. The pivotal element of each claim asserted by White is the allegation that she was terminated. White’s first claim, on appeal, is that she was discriminated against on the basis of her sex and because she had recently been pregnant, and that the discrimination resulted in the termination of her employment at the University. The analysis of a discrimination claim is essentially the same under the State and Federal statutes. See Wheelock College v. Massachusetts Comm’n Against Discrimination, 371 Mass. 130, 135 & n.5 (1976); Radvilas v. Stop & Shop, Inc., 18 Mass. App. Ct. 431, 438-439 (1984). In order to establish a prima facie case of sex discrimination resulting in termination of employment, White must establish that (1) she is a member of a protected group; (2) she performed her job at an acceptable level; (3) she was terminated; and (4) her employer sought a replacement with similar qualifications. See Duke v. Uniroyal Inc., 928 F.2d 1413 (4th Cir. 1991) (standard applied in challenge of termination on basis of age discrimination). See also Wheelock College, supra at 135 n.5, citing McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 n.13 (1973) (facts necessary to establish prima facie case of discrimination will vary depending on situation). Asserting a claim based on sex discrimination as a pregnant woman, White is a member of a protected group. See Massachusetts Elec. Co. v. Massachusetts Comm’n Against Discrimination, 375 Mass. 160, 167 (1978), citing General Elec. Co. v. Gilbert, 429 U.S. 125, 149 (1976) (Brennan, J„ dissenting) (classification relying on pregnancy is distinction based on sex). There was also evidence that she performed her job at an acceptable level, prior to her extended leave of absence beginning in February, 1987. There is no evidence, however, that White was terminated from her position. In fact, the parties agree that in Clarke’s August 14, 1987, letter he offered to renew White’s full-time contract beginning September 1, 1987. White argues that Clarke’s offer was not a genuine offer but, rather, a ruse. White alleges that Clarke knew she could not obtain day care for her child on such short notice, having received the offer only eleven days before the new contract was to begin. While we acknowledge that inferences which may be drawn from uncontested facts are to be drawn in favor of the opposing party, the application of this principle “is predicated on the clear averment by the opposing party of subsidiary facts in [her sworn] pleadings or affidavits.” Community Nat’l Bank, supra at 559 n.8. White offered no specific facts to demonstrate that Clarke’s offer was a ploy to terminate her. Many of her statements in her affidavit were on information and belief (the motion judge characterized them as “opinion”) and, thus, are not sufficient under rule 56. See McKenzie v. Brigham & Women’s Hosp., 405 Mass. 432, 437-438 (1989). The only other evidence remotely on point is from the deposition testimony of the co-director of the Joiner Center, Kevin Bowen. Bowen testified that Clarke said “he had gotten rid of Kate [White].” We do not consider this a clear averment permitting the inference, without more, that the offer of employment was a ruse. The facts of record do not permit the conclusion that White was terminated. Thus, she failed to establish a prima facie case of sex discrimination, and summary judgment for the defendants was properly entered. White’s claim of retaliation also must fail because this claim also is premised on the fact that she was terminated. As we have indicated, and as the Superior Court judge ruled, she was not terminated. White chose not to accept Clarke’s offer of employment. There can be no claim of retaliatory termination when there has not been a termination. Finally, White’s claim that Clarke intentionally interfered with her advantageous relations with the University also is premised on her claim that she was terminated. There having been no termination, White cannot establish a prima facie case. Judgment affirmed. General Laws c. 151B, § 4 (1988 ed.), provided, in part: “It shall be unlawful practice: “1. For an employer, by himself or his agent, because of the race, color, religious creed, national origin, sex, or ancestry of any individual, to refuse to hire or employ or to bar or to discharge from employment such individual or to discriminate against such individual in compensation or in terms, conditions or privileges of employment, unless based upon a bona fide occupational qualification.” Subsection 1 of G. L. c. 15IB, § 4, was amended by St. 1989, c. 516, § 4. The amendment is not relevant to this appeal. Title 42 U.S.C. § 2000e-2 provides, in part: “(a) It shall be an unlawful employment practice for an employer— “(1) to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s race, color, religion, sex, or national origin.” The eight-month leave period consisted of an eight-week maternity leave and White’s remaining vacation leave, followed by a five-month leave of absence. The record appendix contains a letter, unsigned and undated, addressed to White’s supervisor, Diggs, in which White requested that she be permitted “to return [in the fall, 1987] to the night program as a part-time teacher, and then return to [her] full-time job in January of 1988,” because her child was “not yet ready for a separation of [the] magnitude” required to undertake full-time employment. Diggs noted in his letter to Clarke that Diggs wanted a “full-time staff’ and that by January, 1988, he wanted “to have the staffing situation stabilized.” Diggs’ supervisor, Kevin Bowen, also approved the extension request. See note 11, infra. White claims that she received the letter on August 20, 1987, and that Clarke intentionally sent her notification by the slowest means possible in order to frustrate her attempts to find day care for her child and begin full-time employment on September 1, 1987. On July 25, 1988, White withdrew her discrimination complaint from the MCAD. White makes no claim that she was constructively terminated. Cf. Rosado v. Santiago, 562 F.2d 114, 119 (1st Cir. 1977). In her brief to this court, White also claims that she was discriminated against when her application for a part-time teaching position was denied. White did not raise this argument in the Superior Court; therefore the claim is not properly before us. We decline to address this issue. See Prior v. Holiday Inns, Inc., 401 Mass. 506, 509 (1988), and cases cited. The deposition testimony was as follows: “Q: Has Mr. Clarke said anything to you at any time which has led you to believe that he was hostile to Kate White? “A [Bowen]: At different times he has expressed hostility to both Kate and Mary, and his threats that he was going to get rid of them I could sometimes interpret as being threats to me because I wanted to keep them, so it was a matter of wills. He did at one point say that after this had transpired, that he had gotten rid of Kate, he was going to get rid of Mary next, and there was nothing I could do to stop him, but this was after he had been drinking.” Although not necessary to our holding, we note that White’s initial discrimination charge alleged that she had already been terminated from her position. Therefore, the filing of her claim could not result in a “re-termination.”

Defendant Win
Battle v. Nash Technical College
14983Jun 4, 1991North Carolina

DEBRA J. BATTLE v. NASH TECHNICAL COLLEGE No. 907SC655 (Filed 4 June 1991) 1. Master and Servant § 10.2 (NCI3d)— wrongful discharge-summary judgment for defendant —proper The trial court did not err by granting summary judgment for defendant on a wrongful discharge claim where plaintiff was discharged from her employment with defendant as a Counselor Instructor for failure to repay student loans to ECU. N.C.G.S. § 143-553 provides that State Employees who owe money to the State must make full restitution as a condition of continuing employment; a prior opinion in this case held that the essential issues of fact litigated and determined in the administrative decision are conclusive between the parties; and the issues between the parties were litigated and determined by defendant’s Board of Trustees or were not properly before the Court of Appeals. Am Jur 2d, Master and Servant §§ 54, 55. 2. Appeal and Error § 382 (NCI4th)— wrongful discharge— settlement of record by court — no abuse of discretion The trial court did not abuse its discretion in a wrongful discharge action by not allowing plaintiffs motion to include her response to defendant’s summary judgment motion and attachments thereto in the record on appeal and the transcript of the hearing. Plaintiff did not attempt to present opposing affidavits until the day of the hearing; Rule 56 specifically provides that the moving parties be required to submit supporting affidavits which would set forth the moving party’s basis for the motion and that opposing affidavits should be filed prior to the day of the hearing. Moreover, the court did not abuse its discretion in excluding the transcript from the record on appeal; the case on this record does not necessitate a copy of the transcript of the hearing. Am Jur 2d, Appeal and Error §§ 427, 444. Judge GREENE concurring. APPEAL by plaintiff from judgment entered 25 January 1990 by Judge Napoleon B. Barefoot in NASH County Superior Court and appeal by defendant from order entered 18 April 1990 by Judge Napoleon B. Barefoot in NASH County Superior Court and order entered 30 May 1990 by Judge Frank R. Brown in NASH County Superior Court. Heard in the Court of Appeals 23 January 1991. This is the second appeal in a civil action for wrongful discharge from employment. Plaintiff seeks reinstatement and damages incurred as a result of the termination of her employment. On 23 January 1986 plaintiff entered into a written contract with defendant to work as a Counselor/Instructor until 30 June 1986. The contract provided that plaintiff would receive $1,637.00 per month as compensation. From approximately 1979 until the current contract plaintiff had been periodically employed by defendant under contracts ranging in duration from six months to a year. During the time that plaintiff was employed by defendant, plaintiff had been in default on a loan evidenced by a promissory note payable to East Carolina University (ECU). The loan was part of the National Direct Student Loan Program. While a student at ECU plaintiff also borrowed money from the Sarah E. Clement Emergency Loan Program. Eventually, ECU secured a civil money judgment against plaintiff for the unpaid loan balances. On 2 July 1984, ECU wrote plaintiff’s employer, defendant Nash Technical College (Nash), and informed them that plaintiff had failed to repay the loan and as an employee of Nash was violating G.S. Chapter 143, Article 60. At that time, plaintiff was in default in the amount of $4,233.39 on the National Direct Student Loan and $263.89 on the Sarah E. Clement Emergency Loan. Nash’s president, Dr. J. Reid Parrot, Jr., then wrote plaintiff and advised her about the ECU correspondence and informed her that G.S. Chapter 143, Article 60 “provides that employees of the State who owe money to the State must make full restitution of the amount as a condition for continued State employment.” Before 27 May 1986, plaintiff made one voluntary payment of $20.00 on 1 February 1983. Plaintiff’s state income tax refunds were seized in 1983, 1984 and 1985 to be applied against her indebtedness. Again, on 24 March 1986, ECU contacted Nash’s Vice President, Dr. Charles A. Bucher. ECU demanded that plaintiff’s employment be terminated for her failure to repay the indebtedness. Dr. Bucher wrote ECU for verification of the loan and ECU informed him that as of 1 May 1986 plaintiff was delinquent in the amount of $3,685.89. Dr. Parrot then wrote plaintiff and directed her to meet with Nash’s officials to discuss the matter. On 15 May 1986, plaintiff met with the officials and indicated that there were some problems with ECU’s records and that she would look into the matter. Thereafter, Dr. Parrot wrote plaintiff and informed her that her employment was terminated effective 31 May 1986. Plaintiff appealed that decision to Nash’s Board of Trustees (Board). At the conclusion of the Board’s hearing, the Board determined that plaintiff had not repaid her debt within a reasonable period of time after receiving written notice of her responsibility to do so. The Board also determined that “[t]here was no genuine dispute as to whether the money was owed by Ms. Battle to ECU, or how much was owed, and there was no unresolved issue concerning insurance coverage.” As a result the Board concluded that “Deborah J. Battle did not repay the amount owed ECU within a reasonable time after notice to her of her right to do so. There was no genuine dispute as to whether or not said money was owed and there was no unresolved issue concerning insurance coverage[;] [t]here was no extraordinary reason that made Deborah J. Battle incapable of repaying her debts to ECU[; and] Deborah J. Battle did not attempt repayment of the debts to ECU in good faith.” The Board determined that plaintiff’s termination was appropriate. On 8 May 1987, plaintiff initiated this action seeking compensation for lost income and other expenses incurred as a result of her discharge, punitive damages, reinstatement, costs and attorneys’ fees. Defendant answered denying any liability. Subsequently, defendant filed a motion for summary judgment. Plaintiff filed no counter-affidavits or other forecast of evidence. The trial court granted defendant’s motion and dismissed the action with prejudice. Plaintiff appealed. Thereafter defendant moved to dismiss plaintiff’s appeal for plaintiff’s failure to comply with Rule 11(b) of the N.C. Rules of Appellate Procedure by failing to serve the proposed record on appeal on defendant’s counsel in a timely manner. The trial court denied this motion. Defendant appealed the denial of that motion. Subsequently, defendant moved to dismiss the appeal for plaintiff’s failure to comply with Rules of Appellate Procedure 9(a)(1)(e) and 9(b)(2). The trial court denied this motion. Defendant appealed. Leland Q. Towns for plaintiff-appellant. Valentine, Adams, Lamar, Etheridge & Sykes, by L. Wardlaw Lamar, for defendant-appellee. EAGLES, Judge. I. Plaintiff’s Appeal Plaintiff first assigns as error the trial court’s granting of defendant’s motion for summary judgment since there were still material issues to be tried. In her brief plaintiff contends that the following matters were in dispute: “1. It is disputed whether money owed to East Carolina University is money owed to the State pursuant to the statute; 2. It is disputed whether the plaintiff falls within the exception of the statute that a genuine dispute as to the money owed and whether she was pursuing her administrative remedies; 3. It is disputed whether amounts garnished from her income tax refund constitutes repayment under the statute; 4. It is disputed whether the reasonable time period as contemplated by the statute ran from May 15,1986 until the date of her dismissal; 5. It is disputed whether Nash Technical College violated the provisions of its policies and procedures regarding due process and affording plaintiff a hearing prior to her termination.” Plaintiff contends that none of these issues were litigated by the Board and that “[t]he granting of the defendant’s motion for summary judgment was simply inappropriate given the nature of issues raised in all the pleadings, the documents, the numerous hearings and the total circumstances.” We disagree and affirm. At the outset, we note that in our prior opinion, Battle v. Nash Technical College, (unpublished opinion), (94 N.C. App. 601, 381 S.E.2d 353, 887SC1171, 5 July 1989), disc. rev. denied, 325 N.C. 431, 384 S.E.2d 536 (1989), citing Maines v. City of Greensboro, 300 N.C. 126, 133, 265 S.E.2d 155, 160 (1980), the Battle court stated that “those essential issues of fact which were litigated and determined in the administrative decision are conclusive between the parties in this action.” “Once an appellate court has ruled on a question, that decision becomes the law of the case and governs the question not only on remand at trial, but on a subsequent appeal of the same case.” North Carolina National Bank v. Virginia Carolina Builders, 307 N.C. 563, 566, 299 S.E.2d 629, 631 (1983). G.S. 143-553 in pertinent part provides the following: (a) All persons employed by an employing entity as defined by this Part who owe money to the State and whose salaries are paid in whole or in part by State funds must make full restitution of the amount owed as a condition of continuing employment. (b) Whenever a representative of any employing entity as defined by this Part has knowledge that an employee owes money to the State and is delinquent in satisfying this obligation, the representative shall notify the employing entity. Upon receipt of notification an employing entity shall terminate the employee’s employment if after written notice of his right to do so he does not repay the money within a reasonable period of time; provided, however, that where there is a genuine dispute as to whether the money is owed or how much is owed, or there is an unresolved issue concerning insurance coverage, the employee shall not be dismissed as long as he is pursuing administrative or judicial remedies to have the dispute or the issue resolved. After careful review of the Board’s resolution, which was attached to Dr. Parrot’s affidavit in support of defendant’s motion for summary judgment, we hold that the following issues were litigated and determined by the Board and as a result are conclusive between the parties. First, with respect to whether the money owed to ECU was money owed to the State, the Board in its resolution stated that “[t]he funds borrowed by Ms. Battle pursuant to the National Direct Student Loan Program and the Sarah E. Clement Emergency Loan Fund at ECU constituted State funds.” Second, with respect to whether plaintiff fell within the exception of the statute concerning a genuine dispute as to the money owed, the Board concluded that “[t]here was no genuine dispute as to whether or not said money was owed and there was no unresolved issue concerning insurance coverage.” Third, with respect to whether a reasonable time period ran from 15 May 1986, which was the date that plaintiff met with Nash’s officials, until plaintiffs dismissal, the Board concluded that “Deborah J. Battle did not repay the amount owed ECU within a reasonable time after notice to her of her right to do so.” While the Board’s resolution did not address the following issues mentioned by plaintiff, we hold that they are not properly before this Court. With respect to whether Nash violated the provisions of its policies and procedures regarding termination, we find no record evidence of Nash’s “policies and procedures” regarding termination. We note that defendant admitted in his answer that it “had a personnel policy providing for grounds for dismissal, and notice and hearing requirements for the non-tendering of new contracts” but denied plaintiff’s allegation that the procedure was not observed. While plaintiff has attached a copy of this information to her brief, it is not part of the record on appeal. There is record evidence that plaintiff was given the opportunity for repayment and that a reasonable amount of time had passed between notice of default and plaintiff’s termination. Secondly, with respect to whether amounts garnished from her income tax refund constitute repayment under the statute, the Board in its resolution found that plaintiff made only one voluntary payment of $20.00 on 1 February 1983 and that the following sums were seized from plaintiff’s State income tax refund: $368.58 (14 October 1983); $364.58 (7 December 1984); and $723.56 (3 September 1985). Without expressly deciding whether the garnishment of an income tax refund constitutes repayment under the statute, here there is no evidence that plaintiff attempted voluntary repayment of her indebtedness. ECU contacted Nash on 24 March 1986 and informed Mr. Bucher that “Ms. Battle is making no effort on her own to make repayment.” Subsequently, Ms. Battle met with officials of Nash and informed them that there was a “mix-up” or “error” in ECU’s records and that Nash “would be receiving correspondence within one week straightening out the matter.” Even if seizure of tax refunds would be sufficient to constitute a partial repayment under the statute, here even after receiving the 1985 tax refund, ECU determined that plaintiff was still delinquent in satisfying her obligation and as a result wrote Nash’s vice-president again in March of 1986. Though she paid the ECU debt on 26 May 1986, shortly after she was terminated by Nash on 20 May 1986, in light of her payment history after the July 1984 discussion, it is clear that plaintiff did not attempt to repay her indebtedness within a reasonable amount of time after receiving notice of the March 1986 correspondence. Accordingly, this assignment of error is overruled. Plaintiff next assigns as error the trial court’s failure “to allow plaintiff to include her response to defendant’s summary judgment and attachments thereto in the record on appeal and the transcript of the hearing since plaintiff should have been allowed to file these items and they should have been considered by the trial court.” Plaintiff argues that the trial court abused its discretion in excluding these matters from the record. Plaintiff argues that she was “not required to respond to the defendant until such time as the defendant had carried out [its] burden” of proving that summary judgment should be granted in its favor. Plaintiff further argues that the inclusion of the transcript in the record on appeal was “necessary for the reviewing court to make a fair and accurate assessment of the case and the proceedings below.” “It appears to be well established in this State that the action of the judge in settling the case on appeal, when the parties cannot agree, is final and will not be reviewed on appeal.” Millsaps v. Wilkes Contracting Co., 14 N.C. App. 321, 327, 188 S.E.2d 663, 666-67, cert. denied, 281 N.C. 623, 190 S.E.2d 466 (1972). G.S. 1A-1, Rule 56 provides that “[t]he adverse party prior to the day of hearing may serve opposing affidavits.” G.S. 1A-1, Rule 56 does not contain a specific provision with respect to when affidavits in support of a motion for summary judgment must be filed and served. Nevertheless, it seems implicit in Rule 56(c) that such affidavits must be filed and served prior to the day of the hearing. Rule 56(c) provides: “The adverse party prior to the day of the hearing may serve opposing affidavits.” It is clear that opposing affidavits are to be served prior to the day of the hearing. It follows that the clear intent of the legislature is that supporting affidavits should be filed and served sufficiently in advance of the hearing to permit opposing affidavits to be filed prior to the day of the hearing. Nationwide Mut. Ins. Co. v. Chantos, 21 N.C. App. 129, 130, 203 S.E.2d 421, 423 (1974). “Undoubtedly, Rule 56(e) grants to the trial court wide discretion to permit affidavits to be supplemented or opposed by depositions, answers to interrogatories, or further affidavits. However, this provision presupposes that an affidavit or affidavits have already been served. The rule speaks only of supplementing or opposing.” Id. at 131, 203 S.E.2d at 424. Here plaintiff did not attempt to present opposing affidavits until the day of the hearing. In her brief plaintiff argues that she was not required to respond to defendant’s motion for summary judgment until defendant had carried out his burden and the basis for his motion became clear. We find this argument meritless especially in view of the fact that Rule 56 specifically provides that the moving party is required to submit supporting affidavits which would set forth the moving party’s basis for the motion and that opposing affidavits should be filed prior to the day of the hearing. On this record we hold that the trial court did not abuse its discretion in failing to allow plaintiff’s response or include the response in the record on appeal. Likewise, the trial court did not abuse its discretion in excluding the transcript from the record on appeal. Our assessment of the case on this record does not necessitate a copy of the transcript of the hearing. Accordingly, this assignment of error is overruled. II. DEFENDANT’S APPEAL Defendant assigns as error the trial court’s denial of its motion to dismiss plaintiff’s appeal for failure of the plaintiff to serve the proposed record on appeal within the time allowed by Rule 11(b) and assigns as error the trial court’s failure to dismiss plaintiff’s appeal for plaintiff’s inclusion of paperwritings in the proposed record on appeal which were not before the court at the time of the entry of summary judgment and plaintiff’s failure to include the complete order of the Board in the proposed record. While we have considered defendant’s assignments of error, we find it unnecessary to address defendant’s appeal since we have affirmed the trial court’s grant of summary judgment in defendant’s favor in plaintiff’s appeal. The decision of the trial court is affirmed. Affirmed Judge GREENE concurs with separate opinion. Judge Phillips concurs in the result only. Judge GREENE concurring. I write separately to emphasize that the pre-hearing filing requirement applicable to affidavits in support of and in opposition to a summary judgment motion does not apply to other evidence the parties may wish to present at the summary judgment hearing. In addition to affidavits, other appropriate evidence at a summary judgment hearing includes the pleadings, depositions, stipulations, answers to interrogatories, admissions on file, and oral testimony. N.C.G.S. § 1A-1, Rule 56(c) (1990) (authorizing consideration of “the pleadings, depositions, answers to interrogatories, and admissions on file”); N.C.G.S. § 1A-1, Rule 43(e) (1990) (“[w]hen a motion is based on facts not appearing of record the court . . . may direct that the matter be heard wholly or partly on oral testimony . . .”); 10A C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure § 2723 (2d ed. 1983) (Rule 43(e) applies to summary judgment motions). With the exception of affidavits, the other evidence appropriately considered by a trial court at a summary judgment hearing need not be presented “prior to the day of [the] hearing . . . .” Furthermore, despite the specific language of Rule 56(c) requiring affidavits to be filed “prior to the day of [the] hearing,” the trial court may in some instances permit the filing of the affidavits at a later time. If a request for permission to file affidavits at some later time is made before the date of the summary judgment hearing, the trial court may in its discretion order the period for filing affidavits to be enlarged. N.C.G.S. § 1A-1, Rule 6(b) (1990). If a request for permission to file affidavits is made on the day of the summary judgment hearing, the trial court “may permit the act to be done where the failure to act was the result of

Defendant Win
Yedla
E.D. Mich.May 24, 1991Michigan
Remanded
Equal Employment Opportunity Commission v. Grinnell Fire Protection Systems Co.
D. Kan.May 21, 1991Kansas
Plaintiff Win
Hale v. Comerica Bank-Detroit
8979May 20, 1991Michigan

HALE v COMERICA BANK-DETROIT Docket No. 115403. Submitted January 18, 1991, at Detroit. Decided May 20, 1991, at 9:35 a.m. Leave to appeal sought. Patricia Hale brought a wrongful discharge action in the 36th District Court against Comerica Bank-Detroit after her employment as a loan officer was terminated following her acceptance of $100 from a person who had obtained a loan through her from the bank. The court, Theresa Doss, J., entered a judgment in favor of the plaintiff following a bench trial, determining that while the plaintiff may have violated the defendant’s code of ethics by accepting the gratuity, the defendant nevertheless breached the contract of employment by failing to follow the four-step procedure for termination outlined in its employee manual. The Wayne Circuit Court, Louis F. Simmons, J., affirmed. The defendant appealed by leave granted. The Court of Appeals held: The district court erred in concluding that the defendant had to follow the four-step procedure before terminating the plaintiff’s employment. The defendant properly adhered to the procedures for an immediate release from employment. The defendant’s code of ethics provided that under no circumstances was an employee to accept cash from an existing or prospective bank customer and that, in the event of serious misconduct, a manager was to promptly contact a personnel representative because the offending employee could be immediately released from employment. The requirements for immediate release were met in this case because the plaintiff’s acceptance of cash was serious misconduct and a personnel representative was immediately contacted. Reversed and remanded for entry of a judgment in favor of the defendant. Hatchett, DeWalt & Hatchett (by Ronald Mc-Duffie), for the plaintiif. John Cerretani, for the defendant. Before: Marilyn Kelly, P.J., and Holbrook, Jr., and Michael J. Kelly, JJ. Marilyn Kelly, P.J. This is a wrongful discharge action. Defendant appeals by leave granted from the circuit court’s affirmance of the district court’s judgment for plaintiff. We reverse and grant summary disposition to defendant. Plaintiff was a loan officer at defendant’s bank. As part of her job, she processed several loan applications for Clarence Miller. Eventually Miller received approval for a $2,000 loan. When he picked up the check, plaintiff suggested he pay her $100 in exchange for approving the loan. Miller agreed to return with the money the next day. Miller alerted Comerica’s management. The following day, Brenda Coleman, a Comerica employee, witnessed the payment of $100 by Miller to plaintiff. She confronted plaintiff and drove her to bank headquarters. There, plaintiff was fired on the grounds that her conduct was an abuse of her position and a violation of the bank’s Code of Ethical Conduct. Plaintiff claimed she suggested the $100 payment as an alternative to Miller’s offer to buy her lunch. In her suit for wrongful discharge, she alleged that her termination was a breach of her employment contract. The district court judge found that plaintiff had violated the Code of Ethical Conduct. However he also found that when terminating plaintiff’s employment, the bank had failed to follow the procedural steps for corrective action set forth in the employee manual. The circuit court affirmed the lower court. On appeal, defendant contends the court erred in concluding that it violated the corrective action policy. It argues that the policy does not apply in this type of situation. Generally, this Court will not disturb a judgment, unless there has been an error which produces a result inconsistent with substantial justice. MCR 2.613(A). An employer’s statements of policy, such as those present in manuals, may give rise to enforceable contractual rights. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 614-615; 292 NW2d 880 (1980). The defendant’s ethical code provided in part: Employees . . . are not permitted to accept or solicit gifts, fees, entertainment, vacations, special discounts, loans or other similar gratuities from existing or prospective customers and suppliers, or competitors. These practices are highly improper and, in some instances, unlawful. However, entertainment or gifts extended in accordance with normal business practice may be accepted as long as such gifts are made in good business taste and are of moderate and reasonable value, so that no possible inference can be drawn that such gifts could influence the recipient in the performance of Bank duties. Under no circumstances may an employee accept cash or cash equivalents. [Emphasis added.] The policy manual contained a set of procedural steps for corrective action. However, it also included the following provision: In the event of serious misconduct such as theft, embezzlement, fraud, falsifying bank records, unreported absence, fighting on the job, drinking on the job, arbitrarily not performing one’s job function, sabotage or refusal to follow directions from supervisors, the manager must contact the Personnel Representative promptly, as immediate release may result. (Please note that this above list is illustrative of the type of behavior that will not be permitted and is not intended to be all inclusive.) In this case, plaintiff admitted accepting the cash. Her actions constituted serious misconduct warranting immediate release. Not only did she violate the bank’s Ethical Code, but she may have also violated state and federal law. See 18 USC 215; MCL 750.125; MSA 28.320. The trial court erred in concluding that the bank had to follow the four-step procedure before terminating plaintiff. The record reveals that defendant contacted a personnel representative before discharging plaintiff. The defendant complied with the applicable contract provisions and is entitled to judgment. MCR 7.216(A)(7). Reversed and remanded for entry of judgment in favor of defendant. We do not retain jurisdiction.

Defendant Win
Branch v. Azalea/Epps Home, Ltd.
8979May 7, 1991Michigan

BRANCH v AZALEA/EPPS HOME, LTD Docket No. 124903. Submitted December 18, 1990, at Detroit. Decided May 7, 1991, at 9:30 a.m. Barbara Branch brought an action in the Wayne Circuit Court against Azalea/Epps Home, Ltd., and John Lewis, alleging wrongful discharge from employment. The court, Kaye Tertzag, J., denied a motion for summary disposition by the defendants, who contended that the action was barred by the exclusive remedy provision of the Whistleblowers’ Protection Act, MCL 15.361 et seq.; MSA 17.428(1) et seq., because its ninety-day limitation period had expired. The defendants appealed. The Court of Appeals held: The trial court erred in denying the defendants’ motion for summary disposition. The Whistleblowers’ Protection Act is the plaintiff’s exclusive remedy and is applicable to this case. The period of limitation having expired, the defendants were entitled to summary disposition. 1. The Whistleblowers’ Protection Act provides that an employer must not discharge an employee because the employee reports a suspected violation of law to a public body or is asked by a public body to participate in an investigation. The plaintiff’s principal claim was that she was discharged in retaliation for reporting to a Wayne County Department of Social Services social worker the circumstances of the death of a resident in the defendants’ residential foster-care facility where she worked. 2. The social worker in this case was a public body as defined by § 1(d) of the act. Reversed. 1. Master and Servant — Whistleblowers’ Protection Act — Exclusive Remedy. The Whistleblowers’ Protection Act provides the exclusive remedy for a discharged employee who claims that the discharge was in retaliation for the employee’s report of a suspected violation of law to a public body or participation in an investigation by a public body (MCL 15.361 et seq.; MSA 17.428[1] et seq.). References Am Jur 2d, Master and Servant § 48.7; Plant and Job Safety §§ 59-61. Liability for retaliation against at-will employee for public complaints or efforts relating to health or safety. 75 ALR4th 13. 2. Master and Servant — Whistleblowers’ Protection Act — Public Bodies — Social Workers. A social worker may constitute a public body for purposes of the Whistleblowers’ Protection Act (MCL 15.361[d]; MSA 17.428[1] HD. Charlie C. Taylor, for the plaintiff. Ulanoff, Ross & Wesley, P.C. (by Janice G. Hildenbrand), for the defendants. Before: Gribbs, P.J., and Mackenzie and Jansen, JJ. Per Curiam. Defendants appeal by leave granted a December 20, 1989, circuit court order denying their motion for summary disposition of plaintiff Barbara Branch’s action for wrongful termination of a just-cause employment contract and retaliatory discharge. Defendants’ motion for summary disposition was premised on their allegation that plaintiff’s claim was barred by the exclusive remedy provision of the Whistleblowers’ Protection Act, MCL 15.361 et seq.; MSA 17.428(1) et seq., whose ninety-day limitation period had lapsed. In denying defendants’ motion, the trial court held that plaintiffs cause of action did not fall within the ambit of the act. We reverse. The present lawsuit consists of two separate causes of action: one based on the death of a resident at defendants’ adult residential foster-care facility and the other based on the firing of plaintiff, a housekeeper/aide at the facility. On April 11, 1989, decedent Delores Johnson informed plaintiff that she was short of breath and that repeated requests for medical attention had been denied by defendants. In plaintiffs presence, Johnson made additional requests for medical assistance which were refused. On April 12, 1989, Johnson died of a heart attack. On April 22, 1989, plaintiffs employment was terminated. Plaintiff alleges that defendants wrongfully terminated her employment because she related the circumstances surrounding Johnson’s death to defendant John Lewis and a social worker investigating Johnson’s death. On appeal, plaintiff claims that the Whistleblowers’ Protection Act is inapplicable to the present action because a social worker is not a public body under the act. We disagree. The Whistleblowers’ Protection Act is plaintiff’s exclusive remedy. Covell v Spengler, 141 Mich App 76, 82-84; 366 NW2d 76 (1985). MCL 15.362; MSA 17.428(2) provides: 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. The act defines public body to include: (i) A state officer, employee, agency, department, division, bureau, board, commission, council, authority, or other body in the executive branch of state government. (ii) An agency, board, commission, council, member, or employee of the legislative branch of state government. (iv) Any other body which is created by state or local authority or which is primarily funded by or through state or local authority, or any member or employee of that body. [MCL 15.361(d); MSA 17.428(l)(d).] Thus, under the Whistleblowers’ Protection Act a report to a social worker employed by the Wayne County Department of Social Services is a report to a public body. We are unpersuaded by plaintiffs argument that the definition of employee in subsection a of § 1 of the act, which excludes civil service employees, excludes a social worker from the definition of "a public body.” The definition in subsection a refers to the person reporting the violation or suspected violation of that person’s employer, not the public body receiving the report. Therefore, we hold that the social worker in the present case constituted a public body within the ambit of the Whistleblowers’ Protection Act. Reversed.

Defendant Win
Amos v. Oakdale Knitting Co.
14983May 7, 1991North Carolina

SHARON AMOS, KATHY HALL and EARLINE MARSHALL v. OAKDALE KNITTING COMPANY, and WALTER MOONEY, III No. 8917SC770 (Filed 7 May 1991) Master and Servant § 10.2 (NCI3d)— employment at will — public policy exception — statutory remedy The trial court properly granted defendant’s motion for dismissal under N.C.G.S. § 1A-1, Rule 12(b)(6) where plaintiffs alleged that they had been hourly employees of defendant; plaintiffs learned after completing their workweek that their pay had been reduced substantially below the minimum wage rate; defendant Mooney told plaintiffs they had to work at the reduced pay rate or be fired; plaintiffs refused to work under those conditions and were terminated; and plaintiffs filed an action seeking damages for wrongful discharge. Coman v. Thomas Manufacturing Co., 325 N.C. 172, adopted the public policy exception to the employee at will doctrine, but that exception does not apply here because there is a statutory remedy in the North Carolina courts. Plaintiffs could have continued working and pursued their remedy under N.C.G.S. § 95-25.22. Am Jur 2d, Master and Servant §§ 54, 60, 82, 89. Validity of minimum wage statutes relating to private employment. 39 ALR2d 740. Judge JOHNSON dissenting. APPEAL by plaintiffs from judgment entered 6 April 1989 by Judge Melzer Morgan, Jr., in SURRY County Superior Court. Heard in the Court of Appeals 18 January 1990. Kennedy, Kennedy, Kennedy and Kennedy, by Harvey L. Kennedy and Harold L. Kennedy, III, for plaintiff-appellants. Allman Spry Humphreys Leggett & Howington, P.A., by W. Thomas White and W. Rickert Hinnant, for defendant-appellees. PARKER, Judge. Plaintiffs Sharon Amos, Kathy Hall and Earline Marshall appeal from a judgment dismissing their action pursuant to N.C.G.S. § 1A-1, Rule 12(b)(6) for failure to state a claim on which relief can be granted. Plaintiffs instituted this action seeking damages for wrongful discharge arising out of their employer’s alleged violation of the North Carolina Wage and Hour Act, N.C.G.S. §§ 95-25.1 et seq. In their complaint plaintiffs alleged that prior to their termination, they were employed by defendant Oakdale Knitting Company in Surry County, North Carolina. On 25 February 1988, after completing their workweek, plaintiffs learned that their pay had been reduced to $2.18 per hour, substantially below the North Carolina minimum wage rate of $3.35 per hour. When plaintiffs returned to work on 29 February 1988, they asked their supervisor why their pay had been reduced below minimum wage. The supervisor referred them to Walter Mooney, III, one of the owners of defendant company. Defendant Mooney told plaintiffs they either had to work at the reduced pay rate or they were fired. Plaintiffs refused to work under these conditions and were terminated. Before filing answer, defendants moved to dismiss plaintiffs’ compláint pursuant to N.C.G.S. § 1A-1, Rule 12(b)(6). In the order granting defendants’ motion, the trial judge stated that discharging an at will employee for refusing to work for substantially less than the minimum wage offended the court and appeared to violate the public policy of the State as set out in N.C.G.S. § 95-25.3, but that under the decision in Coman v. Thomas Manufacturing Co., 91 N.C. App. 327, 371 S.E.2d 731 (1988), the public policy exception to the doctrine of employment at will was “limited specifically to instances where an employee [sic] attempts to interfere with testimony in a legal proceeding” and, therefore, plaintiffs’ action had to be dismissed. In reviewing a dismissal pursuant to Rule 12(b)(6) we accept as true all allegations of fact. Sutton v. Duke, 277 N.C. 94, 176 S.E.2d 161 (1970). Dismissal under Rule 12(b)(6) is proper when any one of the following conditions is satisfied: “(1) when the complaint on its face reveals that no law supports plaintiff’s claim; (2) when the complaint on its face reveals the absence of fact sufficient to make a good claim; (3) when some fact disclosed in the complaint necessarily defeats plaintiff’s claim.” Jackson v. Bumgardner, 318 N.C. 172, 175, 347 S.E.2d 743, 745 (1986) (citing Oates v. JAG, Inc., 314 N.C. 276, 333 S.E.2d 222 (1985)). At the outset we note that defendants contend that plaintiffs’ action is preempted by the federal Fair Labor Standards Act, 29 U.S.C. app. §§ 201 et seq. The issue of preemption is a constitutional question arising under the supremacy clause. U.S. Const, art. VI, cl. 2. Nothing in the record suggests that defendants raised the issue of preemption before the trial court and the trial court did not rule on this issue in granting the motion to dismiss. For this reason, we will not review defendants’ contentions with regard to this issue. Comr. of Insurance v. Rate Bureau, 300 N.C. 381, 428, 269 S.E.2d 547, 577 (1980). On appeal plaintiffs contend that our Supreme Court in reversing the Court of Appeals’ decision in Coman v. Thomas Manufacturing Co., 91 N.C. App. 327, 371 S.E.2d 731 (1988), rev’d, 325 N.C. 172, 381 S.E.2d 445 (1989), adopted the public policy exception to the employment at will doctrine and that their complaint now states a claim for relief for wrongful termination. No question exists as to whether plaintiffs were employees at will. We agree with plaintiffs that Coman adopted the public policy exception to the employee at will doctrine. Id. at 175, 381 S.E.2d at 447. The question, therefore, is whether this judicially adopted exception applies in the case at bar thereby entitling plaintiffs to maintain their action for wrongful discharge. For the reasons stated herein, we hold that it does not. Without question, payment of the minimum wage is the public policy of North Carolina. N.C.G.S. § 95-25.1(b) states: The public policy of this State is declared as follows: The wage levels of employees, hours of labor, payment of earned wages, and the well-being of minors are subjects of concern requiring legislation to promote the general welfare of the people of the State without jeopardizing the competitive position of North Carolina business and industry. N.C.G.S. § 95-25.1(b) (1985). To this end the legislature has mandated that effective 1 January 1983 every employer who is not exempt from the legislation will pay a minimum wage of at least three dollars and thirty-five cents ($3.35) per hour. N.C.G.S. § 95-25.3(a) (1985). Moreover, in furtherance of this policy the legislature provided a remedy for the employee in the event the employer failed to comply with mandates of the Wage and Hour Act. N.C.G.S. § 95-25.22 provides that an employee may maintain an action in the General Court of Justice to recover unpaid minimum wages with interest thereon; that the court may in its discretion award exemplary damages in the' amount of the recovery; and that the court may award costs and reasonable attorneys’ fees to the employee. N.C.G.S. §§ 95-25.22(a), (b) and (d) (1985). The legislature also provided a remedy in the event the employer retaliates against the employee for exercising this right. N.C.G.S. § 95-25.20(a). Thus unlike the plaintiff in Coman, plaintiffs in this case have available to them a statutory remedy in the North Carolina court. In Coman plaintiff had been directed to violate United States Department of Transportation regulations by driving more hours than allowed by the regulations and to falsify his logs. Our Supreme Court recognized that plaintiff might have an additional remedy in federal court but ruled that North Carolina could not fail to provide a forum under the open courts clause of the North Carolina Constitution. N.C. Const, art. I, § 18 (1986). Coman, 325 N.C. at 174, 381 S.E.2d at 446. Plaintiffs argue that they were terminated before they had an opportunity to file a complaint. The complaint in this action alleges, however, that they were told “they either had to work under the conditions of the reduced pay or they were fired. The Plaintiff[s] refused to work for $2.18 an hour and [were] thereby terminated from [their] employment by the Defendants.” Plaintiffs thus had two options: (i) to continue working and pursue their remedy under N.C.G.S. § 95-25.22, which would have made them whole, or (ii) to refuse to work and be fired. Plaintiffs chose the latter. They were not terminated in retaliation for filing a complaint. N.C.G.S. § 95-25.20(a), therefore, has no applicability. The General Assembly in enacting the Wage and Hour Act expressly recognized that the general welfare of the people necessitated a balancing of the employee’s right to earn acceptable wages and the competitive position of North Carolina business and industry. N.C.G.S. § 95-25.1(b). The statutory remedy making the employer potentially liable for up to twice the amount due plus the costs and expenses incurred by the employee in pursuing the claim reflects this balancing. By this opinion we do not in any way condone an employer’s violation of the minimum wage law with the resultant hardship and inconvenience to its employees, and we expressly denounce such unlawful coercive attempts to deprive employees of the wages to which they are lawfully entitled. The legislature having expressed its intent, however, we decline to extend the public policy exception to the employment at will doctrine to afford a cause of action in addition to that provided by statute. Relegating an employee to his statutory remedy is, in our view, a sound policy where, as here, the employee has not been required to engage in unlawful conduct and the employer’s statutory violation does not threaten the public safety. See Coman v. Thomas Manufacturing Co., 325 N.C. 172, 381 S.E.2d 445 (1989); Sides v. Duke University, 74 N.C. App. 331, 328 S.E.2d 818, disc. rev. denied, 314 N.C. 331, 333 S.E.2d 490 (1985). Moreover, limitation of the public policy exception to situations where there is no statutory redress finds support in other jurisdictions. See, e.g., Wehr v. Burroughs Corp., 438 F. Supp. 1052 (E.D. Pa. 1977), aff’d as modified, 619 F.2d 276 (3d Cir. 1980), and cases cited therein, in which the district court declined to recognize a separate breach of contract action for age discrimination in violation of the Pennsylvania Human Relations Act, now 43 Pa. Cons. Stat. Ann. §§ 951 et seq. (Purdon 1991). Noting that the public policy exception had been applied only where the employee had no other remedy and a valuable social policy would go unvindicated, the court concluded: It is clear then that the whole rationale undergirding the public policy exception is the vindication or the protection of certain strong policies of the community. If these policies or goals are preserved by other remedies, then the public policy is sufficiently served. Therefore, application of the public policy exception requires two factors: (1) that the discharge violate some well-established public policy; and (2) that there be no remedy to protect the interest of the aggrieved employee or society. 438 F. Supp. at 1055. For the foregoing reasons, we hold that plaintiffs’ complaint as a matter of law does not state a cause of action for wrongful termination. Affirmed. Judge Greene concurs. Judge Johnson dissents. Judge JOHNSON dissenting. I respectfully dissent. I agree with the majority that plaintiffs’ complaint as a matter of law does not state a cause of action for wrongful termination. I believe, however, that under notice pleading the complaint sufficiently states a cause of action pursuant to N.C.G.S. § 95-25.22.1 would reverse the dismissal to allow plaintiffs to pursue their remedy under that statute.

Defendant Win
Kostello v. Rockwell International Corp.
8979May 7, 1991Michigan

KOSTELLO v ROCKWELL INTERNATIONAL CORPORATION Docket No. 123566. Submitted February 6, 1991, at Lansing. Decided May 7, 1991, at 10:00 a.m. Edward M. Kostello brought an action in the Oakland Circuit Court against Rockwell International Corporation, and others, alleging breach of an employment contract, wrongful discharge, and negligent evaluation. The court, Hilda R. Gage, J., granted summary disposition for the defendants, finding that there was no breach of contract because the plaintiff was an at will employee, and that the alleged breach of contract did not give rise to an action sounding in negligence because the claimed breach of duty to exercise reasonable care in evaluating an employee was indistinguishable from the asserted breach of contract. The plaintiff appealed. The Court of Appeals held: 1. The trial court correctly found that the plaintiff was an employee at will, who had neither an express agreement nor a legitimate objective expectation that he would be terminated for just cause only. The mere existence of a probationary period for newly hired employees did not give rise to a legitimate objective expectation of discharge for just cause only. 2. A breach of an employment contract does not give rise to a claim in tort in a case like the present one where the breach of duty is indistinguishable from the breach of contract. Affirmed. 1. Master and Servant — Employment at Will — Probationary Terms. Employment for an indefinite term generally is presumed to be terminable at the will of either party; a contractual commitment to terminate for just cause only may arise from an oral or written express agreement or as a result of the legitimate expectation of an employee grounded in the employer’s policy statements; the mere existence of a probationary period for newly hired employees does not give rise to a legitimate objective expectation of discharge for just cause only. References Am Jur 2d, Master and Servant §§ 27, 32. Right to discharge allegedly "at-will” employee as affected by employer’s promulgation of employment policies as to discharge 33 ALR4th 120 Modem status of rule that employer may discharge at-will employee for any reason. 12 ALR4th 544. 2. Master and Servant — Breach of Employment Contracts — Torts. A breach of an employment contract does not give rise to a claim in tort where the alleged breach of duty is indistinguishable from the breach of contract. William J. Berardo, for the plaintiff. Plunkett & Cooney, P.C. (by Ernest R. Bazzana, James R. Kohl, and Michael G. Costello), for the defendants. Before: Danhof, C.J., and Holbrook, Jr., and Sullivan, JJ. Per Curiam. Plaintiff appeals as of right an order of the Oakland Circuit Court granting defendants summary disposition of his wrongful discharge, negligent evaluation, and breach of contract claims. We affirm. Plaintiff was hired by defendant Rockwell International Corporation as a chemist in their Automotive Operations Engineering Division in April 1972. In May 1982, he was evaluated by his supervisors as unsatisfactory and placed on probation. On September 22, 1982, plaintiff received a status report which also rated him as unsatisfactory. By October 7, 1982, plaintiff had failed to show any improvement and was terminated by Rockwell. Some six years later, plaintiff instituted the action before us. Of the original six counts, the parties agreed to the dismissal of four, and the remaining two, breach of contract and tortious wrongful discharge, were the subject of defendants’ motion for summary disposition. In granting summary disposition of the breach of contract claim, the trial court found "no express or implied promise to change the status of the plaintiff from at will employee to a discharge for just cause” employee and that "[h]e had no reason to give that expectation or come to that expectation or conclusion. I don’t see any objective evidence or promise to discharge only for just cause . . . . ” Regarding the tortious wrongful discharge claim, the trial court determined that the asserted breach of contract did not give rise to an action sounding in negligence because the claimed breach of duty was indistinguishable from the asserted breach of contract. Plaintiff’s first argument focuses on whether the trial court erred in finding no genuine issue of fact and granting defendants summary disposition on the breach of contract claim. Defendants brought their motion for summary disposition pursuant to MCR 2.116(C)(8), (10). For purposes of the breach of contract claim, in light of the parties’ reliance on matters outside of the pleadings in arguing the motion, the trial court viewed the motion as one brought pursuant to MCR 2.116(0(10). The party opposing a motion brought under MCR 2.116(0(10) has the burden of showing that a genuine issue of disputed fact exists, Dumas v Auto Club Ins Ass’n, 168 Mich App 619, 626; 425 NW2d 480 (1988), lv gtd 434 Mich 911 (1990), and the disputed factual issue must be material to a dispositive legal claim, Belmont v Forest Hills Public Schools, 114 Mich App 692, 696; 319 NW2d 386 (1982). Giving the benefit of reasonable doubt to the nonmovant, the court must determine whether a record might be developed which would leave open an issue upon which reasonable minds could differ. Dumas, supra. All inferences are to be drawn in favor of the nonmovant. Dagen v Hastings Mutual Ins Co, 166 Mich App 225, 229; 420 NW2d 111 (1987). As a general rule, employment for an indefinite term is presumed to be terminable at the will of either party. Bullock v Automobile Club of Michigan, 432 Mich 472, 511; 444 NW2d 114 (1989); Lynas v Maxwell Farms, 279 Mich 684, 687; 273 NW 315 (1937). In Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 600; 292 NW2d 880 (1980), the Supreme Court stated that the underlying rationale for this rule was that "[b]e-cause the parties began with complete freedom, the court will presume that they intended to obligate themselves to a relationship at will.” Toussaint, therefore, neither abrogated the employment-at-will presumption nor did it create new or special rights. Rather, it held that the right that arose out of a promise not to terminate except for cause was completely enforceable. Valentine v General American Credit, Inc, 420 Mich 256, 258; 362 NW2d 628 (1984). Such a contractual commitment arises from an oral or written express agreement or as a result of the legitimate expectation of an employee grounded in the employer’s policy statements. Toussaint, supra, p 598. We conclude that in the case at bar, plaintiff had neither an express agreement nor a legitimate objective expectation that he would be terminated for just cause only. Plaintiffs assertion that the invention assignment agreement which he signed converted his employment from being terminable at will to being terminable for just cause only is not persuasive. Only through the most tortured construction could the agreement in question be read as providing for just-cause termination only. We find no error in the trial court’s conclusion in this regard. Plaintiff also maintains that a legitimate objective expectation arose from his successful completion of a probationary period when first hired. We disagree. In Toussaint, the Supreme Court held that statements set forth in the employer’s manual, applicable to all employees who successfully completed the probationary period, and not the mere fact a probationary period existed, is what gives rise to a contractual right to be terminated for just cause only. Toussaint, supra, p 614. Thus we conclude that the mere existence of a probationary period does not give rise to a legitimate objective expectation of discharge for just cause only. Plaintiffs second claim is that the trial court erred in granting defendants’ motion for summary disposition of his negligent evaluation claim. Plaintiff alleges that by evaluating him in a subjective and unfair manner, defendants breached their duty to exercise reasonable care in evaluating an employee. The only Michigan court to recognize a negligent evaluation claim in the context of an employment contract was the panel in Schipani v Ford Motor Co, 102 Mich App 606, 623-624; 302 NW2d 307 (1981). Since its release, Schipani has been routinely rejected by other panels of this Court. See Dahlman v Oakland University, 172 Mich App 502, 506-507; 432 NW2d 304 (1988); Sankar v Detroit Bd of Ed, 160 Mich App 470; 409 NW2d 213 (1987); Struble v Lacks Industries, Inc, 157 Mich App 169, 176; 403 NW2d 71 (1986); Brewster v Martin Marietta Aluminum Sales, Inc, 145 Mich App 641, 667-668; 378 NW2d 558 (1985). Instead, these panels have adhered to the rule that a breach of an employment contract does not give rise to a tort claim where the breach of duty is indistinguishable from the breach of contract. See also Grant v Michigan Osteopathic Medical Cen ter, Inc, 172 Mich App 536; 432 NW2d 313 (1988); Lopus v L&L Shop-Rite, Inc, 171 Mich App 486; 430 NW2d 757 (1988); Loftis v G T Products, Inc, 167 Mich App 787; 423 NW2d 358 (1988). We believe this to be the correct statement of Michigan law and, in so holding, pointedly reject the holdings in Schipani. In the case at bar, it is quite obvious that absent an employment contract, defendants would not have evaluated plaintiff. Thus, there could be no breach of duty to evaluate plaintiff distinct from the breach of contract and, the Schipani rule having been rejected, plaintiff cannot maintain an independent tort action for negligent evaluation. We affirm the trial court’s grant of summary disposition of plaintiffs negligent evaluation claim. Affirmed.

Defendant Win
Zeniuk v. RKA, Inc.
8979May 6, 1991Michigan

ZENIUK v RKA, INC Docket No. 119801. Submitted November 8, 1990, at Detroit. Decided May 6, 1991, at 10:05 a.m. Cris ton Zeniuk brought an action in the Oakland Circuit Court against R.K.A., Inc., alleging wrongful discharge. The plaintiff alleged that he was entitled to be dismissed only for just cause on the basis of the termination policy in the company’s employee handbook. The defendant moved for summary disposition on the ground that the plaintiff failed to file a timely demand for arbitration under the mandatory discharge arbitration procedure set forth in the employee handbook. The plaintiff argued that he never received an employee handbook and was unaware that his sole remedy was arbitration. The defendant responded that the plaintiff’s explicit and sworn factual Statements in his complaint regarding the handbook demonstrated that he had knowledge of and familiarity with the provisions of the handbook. The court, David F. Breck, J., denied the motion on the ground that there were questions of material fact about whether the plaintiff had received the handbook. The defendant was granted leave to appeal. The Court of Appeals held: The defendant’s motion should have been granted because there is no issue of material fact and the defendant is entitled to judgment as a matter of law. 1. If the plaintiff is entitled to rely on the handbook to support his claim that he may be terminated Only for just cause, then he is also bound by the other terms relative to the policy in the handbook which provide that any claim of termination without just cause must be made by filing a grievance and a request for arbitration. Plaintiff did not file a grievance or make a request for arbitration. Having failed to pursue his remedy as provided by the company policy, the plaintiff may not pursue in circuit court a wrongful discharge claim based on that policy. 2 The plaintiff was required to show that the just-cause policy was communicated to him in order to take advantage of the policy. Because he did not claim that the policy was communicated to him other than through the handbook, he is bound by the obligations as well as the benefits of the policy as expressed in the handbook. References Am Jur 2d, Labor and Labor Relations § 9. See the Index to Annotations under Labor and Employment. Reversed and remanded for entry of an order granting the defendant’s motion for summary disposition. Wahls, J., dissenting, stated that the plaintiff’s claim is not defeated solely because he had general knowledge of the defendant’s just-cause termination policy. The plaintiff is not required to know the specific terms of the just-cause termination clause in the handbook in order to show that he had a legitimate expectation that it would be applied to him; rather, all that is required is that he had general knowledge of the policy and its applicability to him. A question of material fact existed regarding whether the plaintiff received the employee handbook and therefore was aware of and subject to the arbitration policy. Master and Servant — Termination for Cause — Employee Handbooks. An employee who claims entitlement to dismissal only for just cause on the basis of the termination policy in a company handbook is also bound by other terms in the handbook relative to the making of claims under the policy. Poplar & Kalis, P.C. (by Michael L. Kalis), for the plaintiff. Keywell & Rosenfeld (by Gary W. Klotz and Kari J. Sperstad-McElyea), for the defendant. Before: Reilly, P.J., and Wahls and Doctorqff, JJ. Reilly, P.J. Defendant appeals by leave granted from an order of the Oakland Circuit Court denying its motion for summary disposition, MCR 2.116(0(10), of plaintiffs complaint, which alleged wrongful discharge. We reverse. Plaintiff was hired by defendant in October 1987 as a part-time general contract laborer. In July 1988, plaintiff became a full-time employee, and in October 1988, plaintiff was promoted to the position of evening supervisor. On December 23, 1988, plaintiff and his immediate supervisor were suspended without pay for allegedly misappropriating company funds. However, on January 15, 1989, plaintiff’s immediate supervisor confessed that she, acting alone, misappropriated the funds in question. Despite plaintiff’s exoneration, he was fired on February 16, 1989, on the ground that he allegedly falsified company records. Plaintiff filed his complaint alleging wrongful discharge on April 11, 1989. Plaintiff claimed he was entitled to be dismissed only for just cause because defendant promulgated a just-cause termination policy in the company handbook. Defendant moved to dismiss the complaint, arguing, inter alia, that plaintiff was an employee with seniority status. Defendant’s employee handbook contained a "discharge arbitration procedure” which stated that "discharge arbitration” was the sole remedy available to employees with seniority status. The arbitration procedure required a discharged regular employee with seniority status to file a grievance with defendant within thirty days after the discharge and a written request for arbitration within thirty days after defendant’s response to the employee’s grievance. Plaintiff did not file a grievance or a written request for arbitration. Thus, defendant argued, it was entitled to summary disposition dismissing plaintiff’s breach of employment contract claims on the ground that plaintiff failed to file a timely demand for arbitration under the mandatory "discharge arbitration” procedure set forth in the employee handbook. In response to defendant’s motion for summary disposition, plaintiff argued that he never received an employee handbook and was unaware that his sole remedy- was arbitration. Defendant responded that plaintiff made explicit and sworn factual statements in his complaint regarding the employee handbook which demonstrated that plaintiff had knowledge of and familiarity with the provisions of the handbook. The trial court denied defendant’s motion for summary disposition with respect to the breach of employment contract claims in counts i, ii, and m of plaintiffs complaint on the ground that "there are questions of material fact about whether or not plaintiff received the employee handbook.” Defendant appeals from that portion of the trial court’s decision. A motion for summary disposition premised on MCR 2.116(0(10) tests the factual support for a claim. In ruling on the motion, the trial court must consider the pleadings, affidavits, depositions, and other documentary evidence submitted by the parties. Dumas v Auto Club Ins Ass’n, 168 Mich App 619, 626; 425 NW2d 480 (1988). Giving the benefit of any reasonable doubt to the nonmoving party, the test is whether the kind of record which might be developed will leave open an issue upon which reasonable minds might differ. Id. This Court is liberal in finding a genuine issue of material fact. St Paul Fire & Marine Ins Co v Quintana, 165 Mich App 719, 722; 419 NW2d 60 (1988). Nonetheless, where the opposing party fails to come forward with evidence, beyond the allegations or denials in the pleadings, to establish the existence of a material factual dispute, the motion is properly granted. Morganroth v Whitall, 161 Mich App 785, 788; 411 NW2d 859 (1987); MCR 2.116(G)(4). Defendant’s motion for summary disposition under MCR 2.116(0(10) should have been granted because there is no issue of material fact and defendant is entitled to judgment as a matter of law. Plaintiff claims that he was entitled to be dismissed only for just cause because the employer promulgated a just-cause termination policy in the company handbook. Plaintiff was either an employee who could be terminated for just cause only or he was an at-will employee. If the plaintiff is entitled to rely on the handbook to support his claim that he is a just-cause employee rather than an at-will employee, then he must also be bound by the other terms of the just-cause policy in the handbook, i.e., that any claim of termination without just cause must be made by filing a grievance and a request for arbitration. Plaintiff may not claim only the benefits of a stated policy while rejecting the concomitant obligation to file a grievance and request arbitration in order to enforce those benefits. Plaintiff further argues that he is entitled to the benefits of the company policy as expressed in the handbook, even though he did not receive a copy of the handbook. If plaintiff did not receive a copy of the handbook, and didn’t know its contents, how can he claim he is a just-cause employee? Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), requires a communication of the policy, not just a subjective expectation. Plaintiff does not claim that the company’s just-cause policy was communicated to him other than through the handbook. He has not offered any basis, other than the handbook, for his claim that he is a just-cause employee. Either he is a just-cause employee because the company communicated that policy to him or he is simply an at-will employee with no remedy for his termination. If he is a just-cause employee, he is bound by the obligations as well as the benefits of that policy. The parties agree plaintiff filed neither a grievance nor a request for arbitration. Having failed to pursue his remedy as provided by the company policy, plaintiff cannot now pursue in circuit court a wrongful discharge claim based on that policy. Reversed and remanded for entry of an order granting defendant’s motion for summary disposition under MCR 2.116(0(10). Doctoroff, J., concurred. Wahls, J. (dissenting). In this case, I am of the opinion that the question whether plaintiff received the employee handbook and was thus aware of and subject to defendant’s arbitration policy presented a question of material fact for the fact-finder’s determination. Therefore, I respectfully dissent. In addition to his response to defendant’s motion for summary disposition, plaintiff presented his own sworn affidavit in which he argued that he never received an employee handbook and was unaware that his sole remedy, following discharge, was arbitration. In response, defendant argued that plaintiff’s sworn factual statements, in his complaint, established plaintiff’s knowledge of and familiarity with the employee handbook. However, in rebuttal, plaintiff argued that while he was told about the general terms of employment in the employee handbook, i.e., that defendant would terminate plaintiff only upon just cause, through other employees, plaintiff never received or viewed the actual handbook. Further, plaintiff argued that his reference to an "employee guide” (not an "employee handbook”) in the complaint was not so clear, intelligent, and unequivocal as to constitute knowledge of the employee handbook in its entirety. Notably, plaintiff’s complaint does not cite or reference any specific sections or paragraphs of defendant’s employee handbook. A motion for summary disposition on the ground that there is no general issue of material fact tests the factual support for a claim. Leitch v Switchenko, 169 Mich App 761, 765; 426 NW2d 804 (1988). Before granting a motion for summary disposition made pursuant to MCR 2.116(0(10), the court must consider the affidavits and the pleadings as well as all other evidence, and be satisfied that it is impossible for the claim to be supported at trial because of some deficiency that cannot be overcome. Schippers v SPX Corp, 186 Mich App 595, 596; 465 NW2d 34 (1990). Courts are liberal in finding that a genuine issue exists, giving all benefits of doubt and resolving all reasonable inferences in favor of the nonmoving party. Slaughter v Smith, 167 Mich App 400, 403; 421 NW2d 702 (1988). MCR 2.116(G)(4) provides that "an adverse party may not rest upon the mere allegations or denials of his or her pleading, but must, by affidavits or as otherwise provided in this rule, set forth specific facts showing that there is a genuine issue for trial.” Thus, unlike the plaintiff in Morganroth v Whitall, 161 Mich App 785; 411 NW2d 859 (1987), who failed to file any response to the defendant’s summary disposition motion and did not come forward with evidence to support a finding that a genuine issue of material fact existed, in this case the plaintiff’s claim could not be defeated on the ground that he based his opposition to defendant’s summary disposition motion on the mere allegations and denials in his pleadings. The majority argues that if the plaintiff is entitled to rely on the handbook in support of his claim that he is a just-cause employee, then he is also bound by the other terms of the just-cause policy in the handbook, namely, that he is subject to the terms of the arbitration policy stated therein. I disagree. A provision in an employment contract which provides that an employee shall not be discharged except for cause is legally enforceable whether the provision is an express agreement, oral or written, or is the result of an employee’s legitimate expectations grounded in an employer’s policy statements. These legitimate expectations may be grounded in an employer’s written policy statements as set forth in a manual of personnel policies. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 598-599; 292 NW2d 880 (1980); Renny v Port Huron Hosp, 427 Mich 415, 428; 398 NW2d 327 (1986). While an employer need not establish personnel policies or practices, where an employer chooses to establish such policies and practices and makes them known to its employees, the employment relationship is presumably enhanced. The employer secures an orderly, cooperative and loyal work force, and the employee the peace of mind associated with job security and the conviction that he will be treated fairly. No preemployment negotiations need take place and the parties’ minds need not meet on the subject; nor does it matter that the employee knows nothing of the particulars of the employer’s policies and practices or that the employer may change them unilaterally. It is enough that the employer chooses, presumably in its own interest, to create an environment in which the employee believes that, whatever the personnel policies and practices, they are established and official at any given time, purport to be fair, and are applied consistently and uniformly to each employee. [Toussaint, supra, p 613. Emphasis added.] A plaintiff is not required to know the specific terms of a just-cause termination clause in an employee handbook; only knowledge of the employer’s policy and its applicability to the plaintiff is required. See Rasch v East Jordan, 141 Mich App 336, 345; 367 NW2d 856 (1985). Therefore, in this case, plaintiffs claim is not defeated solely bécause he had general knowledge of defendant’s just-cause termination policy. While Michigan’s public policy favors arbitration in the resolution of disputes, it is well settled that arbitration is a matter of contract. Grand Rapids v Fraternal Order of Police, 415 Mich 628, 634-635; 330 NW2d 52 (1982). An arbitration agreement is a contract, requiring the mutual assent of the parties, by which all the parties agree to forego their rights to proceed with a court action and, instead, to submit their disputes to a panel of arbiters. Horn v Cooke, 118 Mich App 740, 744; 325 NW2d 558 (1982), Arbitration is a matter of contract, and a party cannot be required to submit to arbitration an issue which he has not agreed to submit. John Wiley & Sons, Inc v Livingston, 376 US 543, 546-547; 84 S Ct 909; 11 L Ed 2d 898 (1964); United Steelworkers of America v Warrior & Gulf Navigation Co, 363 US 574, 582; 80 S Ct 1347; 4 L Ed 2d 1409 (1960); Arrow Overall Supply Co v Peloquin Enterprises, 414 Mich 95, 98; 323 NW2d 1 (1982); Kaleva-Norman-Dickson School Dist No 6 v Kaleva-Norman-Dickson School Teachers' Ass’n, 393 Mich 583, 587; 227 NW2d 500 (1975); Omega Construction Co, Inc v Altman, 147 Mich App 649, 655; 382 NW2d 839 (1985). Grosse Pointe Farms Police Officers Ass’n v MERC, 53 Mich App 173, 176-177; 218 NW2d 801 (1974). Except where a compulsory arbitration is provided by statute, the first step toward the settlement of a difference by arbitration is the entry by the parties into a valid agreement to arbitrate. An agreement to arbitrate is a contract, the relation of the parties is contractual, and the rights and liabilities of the parties are controlled by the law of contracts. [Id., p 177 (quoting 5 Am Jur 2d, Arbitration & Award, § 11, p 527).] Thus, the threshold inquiry in determining whether a matter is subject to arbitration is whether an arbitration agreement exists. Roberts v McNamara-Warren Community Hosp, 138 Mich App 691, 694; 360 NW2d 279 (1984). The burden is on the defendant to show that plaintiff knowingly, intelligently, and voluntarily waived his right to court access. Id.; Moore v Fragatos, 116 Mich App 179, 186; 321 NW2d 781 (1982). In this case, plaintiff claimed in his supporting affidavit that he did not receive an employee handbook, and did not have knowledge of the arbitration agreement contained therein. Whether plaintiff is subject to the arbitration agreement is a question of material fact in this case. Where the truth of a material factual assertion of a movant’s affidavit depends on the affiant’s credibility, there inheres a genuine issue to be decided at trial by the trier of fact and a motion for summary disposition cannot be granted. Brown v Pointer, 390 Mich 346, 354; 212 NW2d 201 (1973). Close factual questions are the stuff of which trials are made and are not properly subject to disposition on motions for summary disposition. Lewis v Metropolitan Life Ins Co, 397 Mich 481, 484; 245 NW2d 9 (1976). In sum, giving the benefit of every reasonable doubt to the plaintiff and resolving all reasonable inferences in plaintiff’s favor, I am not satisfied that it would be impossible for plaintiff to support his claim at trial. Summary disposition is never proper when an issue of material fact is present, and it is an overuse of appellate authority to make what amounts to findings of fact on appeal. See Pine Ridge Coal Co v Cronin, 41 Mich App 255, 258; 199 NW2d 876 (1972); Kratochvil v Grayling, 367 Mich 682, 687; 117 NW2d 164 (1962); Warren Tool Co v Stephenson, 11 Mich App 274, 303; 161 NW2d 133 (1968).

Defendant Win
Hungerman v. McCord Gasket Corp.
8979Apr 17, 1991Michigan

HUNGERMAN v McCORD GASKET CORPORATION Docket No. 118152. Submitted January 8, 1991, at Detroit. Decided April 17, 1991; approved for publication June 13, 1991, at 9:00 A.M. John J. Hungerman brought an action in the Wayne Circuit Court against McCord Gasket Corporation and JP Industries, Inc., alleging wrongful termination of employment. The court, Kathleen MacDonald, J., granted the defendants’ motion for summary disposition, finding the action barred by a release signed by the plaintiff which absolved the defendants of liability. The plaintiff appealed, alleging that the release was ineffective because it was signed under duress, and the defendants made misrepresentations regarding its nature. The Court of Appeals held: 1. The plaintiff’s claim is barred by the release, which he was free to refuse to sign and which he signed after he had consulted an attorney. 2. There was insufficient evidence that the defendants’ statement regarding the legal validity of the release constituted intentional misrepresentation. The plaintiff cannot claim that the defendants’ statement of opinion constituted intentional misrepresentation, because he consulted an attorney before signing the release. 3. The plaintiff failed to tender the amount paid under the agreement in a timely manner. Affirmed. Michael A. Conway, for the plaintiff. Barris, Sott, Denn & Driker (by Morley Witus and Daniel J. LaCombe) (Petersmarck, Callahan, Bauer & Maxwell, P.C., by Richard W. West, of Counsel), for the defendants. Before: Jansen, P.J., and Wahls and Hood, JJ. Per Curiam. Plaintiff appeals as of right an order of summary disposition dismissing plaintiff’s claim. Plaintiff had filed suit alleging that defendants wrongfully terminated his employment. Defendants moved for summary disposition under MCR 2.116(C)(7), (10) alleging that plaintiff’s action is barred by a release signed by plaintiff absolving defendants of liability. On appeal, plaintiff alleges that the release is ineffective because he was under duress and defendants made misrepresentations. We disagree and affirm. The release plaintiff signed stated in part: In connection with the termination of employment of John Hungerman ("Employee”) with McCord Gasket Corporation, (the "Company) a subsidiary of JP Industries, Inc., the Company and Employee have entered into the following Severance Agreement. 1. The Company will pay the Employee all earned and accrued vacation pay, which the parties agree total $2,374.62. 2. The Company will also pay Employee a lump sum severance amount of $21,437.50 which equals 5 months of Employee’s salary. 8. The Employee and anyone acting in his behalf does, in consideration of the above, release and forever discharge the Company and Company officers, directors and employees from any and all claims, legal actions and damages which the Employee might raise against the Company now or hereafter pertaining in any way to his employment and/or termination from the Company. The Employee acknowledges that he has had an opportunity to read and discuss the Agreement with the Company. The Employee agrees that no promise or inducement has been offered and that he voluntarily signed and entered into this Agreement with full knowledge of its significance, accepting full responsibility for it. First, plaintiff alleges that the release was signed under duress and that defendants procured his signature under the threat of withholding his accrued vacation pay and earned wages. In order to void a contract on the basis of economic duress, the wrongful act or threat must deprive the victim of his unfettered will. Barnett v International Tennis Corp, 80 Mich App 396, 406; 263 NW2d 908 (1978). Further, the party threatened must not have an adequate legal remedy available. Id. Plaintiff was free to refuse to sign the release. Further, plaintiff consulted an attorney before signing. As a matter of law, we hold that plaintiff’s claim is barred by his release. MCR 2.116(C)(7). Second, plaintiff claims that his release is invalid because there was a misrepresentation regarding the nature of the instrument. To warrant recision or invalidation of a contract or release, a misrepresentation must be made with the intent to mislead or deceive. Paterek v 6600 Limited, 186 Mich App 445, 449; 465 NW2d 342 (1990). An innocent misrepresentation is insufficient to invalidate a release. Id. Where fraud or mistake is alleged, the intent of the parties should be considered. Binard v Carrington, 163 Mich App 599, 604; 414 NW2d 900 (1987). In determining the intent of the parties, we look to the following factors: (1) the haste with which the release was obtained, (2) the amount of consideration, (3) the circumstances surrounding the release, including the conduct and intelligence of both the releasor and the releasee, and (4) the actual presence of an issue of liability. Id. Claims of fraudulent misrepresentation require proof that (1) the defendant made a material representation, (2) it was false, (3) the defendant knew it was false when made, or made it recklessly, without knowledge of its truth and as a positive assertion, (4) it was made with the intention to induce reliance by the plaintiff, (5) the plaintiff acted in reliance upon it, and (6) the plaintiff thereby suffered injury. [State-William Partnership v Gale, 169 Mich App 170, 178; 425 NW2d 756 (1988).] There was insufficient evidence that defendants’ statement regarding the legal validity of the release constituted intentional misrepresentation. Plaintiff consulted his wife and an attorney before signing the release. After having consulted his attorney, plaintiff cannot claim that defendants’ statement of opinion constituted intentional misrepresentation. In any case, we find that plaintiff failed to timely tender back the amount paid under the agreement. Leahan v Stroh Brewery Co, 420 Mich 108, 112; 359 NW2d 524 (1984). Therefore, we conclude that the trial court did not err in granting summary disposition under MCR 2.116(C)(7), (10) on the basis of the valid release. Affirmed.

Defendant Win
Reisman v. Regents of Wayne State University
8979Apr 16, 1991Michigan

REISMAN v REGENTS OF WAYNE STATE UNIVERSITY Docket Nos. 111538, 111557. Submitted July 8, 1990, at Lansing. Decided April 16, 1991, at 9:05 a.m. Leave to appeal sought. Betty L. Reisman brought an action in the Court of Claims and the Wayne Circuit Court against the Regents of Wayne State University alleging breach of an employment contract and reverse discrimination, respectively, after her contract of employment was not renewed. Trials were conducted simultaneously by Richard P. Hathaway, J. The Court of Claims entered a judgment of no cause of action on the breach of contract claim, and a circuit court jury returned a judgment for the plaintiff with regard to the reverse discrimination claim. The plaintiff appealed the judgment of the Court of Claims and the defendant appealed that of the circuit court. The appeals were consolidated in the Court of Appeals. The Court of Appeals held: The judgment of the Court of Claims is affirmed. The judgment of the Wayne Circuit Court is affirmed in part and reversed in part, and the case is remanded for a new trial. 1. The Court of Claims judgment of no cause of action was proper. An employee, such as the plaintiff, who is discharged for reasons of budget cutbacks or economic necessity does not have grounds for a wrongful discharge claim, even if the employment contract expressly provides that the employee is subject to termination only for just cause. The evidence supports a finding that the decision not to renew the plaintiff’s employment contract was motivated by economic necessity. The defendant permitted the plaintiff to serve out the term of her contract of employment and did not breach the contract. 2. The defendant preserved for appeal the issue of the jury instruction regarding the effect of the defendant’s affirmative action policy. 3. The fact that an affirmative action plan, like the one involved in this action, has not been approved by the Civil Rights Commission does not render the plan invalid, and actions taken pursuant to an unapproved plan are not discriminatory per se. The jury was erroneously instructed that, if it found that the defendant considered race in deciding not to renew the plaintiffs contract, it must find that the defendant violated the plaintiffs civil rights. The instruction precluded the jury from considering whether consideration of the affirmative action policy was a legitimate justification for the nonrenewal of the plaintiffs contract. The instruction denied the defendant a fair trial, and reversal is required. References Am Jur 2d, Job Discrimination § 1158. See the Index to Annotations under Budgets and Budgetary Matters; Discrimination; Equal Employment Opportunity. 4. Because the plaintiffs contract allegedly was not renewed because of economic necessity, a prima facie case of race discrimination cannot be established merely by showing that race was a factor in the decision not to renew the plaintiffs employment contract. Instead, the plaintiff must present sufficient evidence to establish that race was a determining factor in the decision not to renew her contract. Because the evidence was such that reasonable jurors could honestly have reached different conclusions about whether the plaintiffs race was a determining factor in the decision not to renew her contract, the trial court did not err in denying the defendant’s motions for a directed verdict and judgment notwithstanding the verdict. 5. If it is determined on retrial that the defendant violated the Civil Rights Act in deciding not to renew the plaintiffs contract, the plaintiff is entitled to any damages which she can show she suffered as a result of the discrimination. Affirmed in part, reversed in part, and remanded. 1. Master and Servant — Termination of Employment — Economic Necessity. An employee who is discharged for reasons of budget cutbacks or economic necessity does not have grounds for a wrongful discharge claim, even if the employment contract expressly provides that the employee is subject to termination only for just cause. 2. Civil Rights — Affirmative Action Plans — Civil Rights Commission Approval. The fact that an affirmative action plan has not been approved by the Civil Rights Commission does not render the plan invalid, and actions taken pursuant to an unapproved plan are not discriminatory per se. 3. Civil Rights — Employment Discrimination — Race — Economic Necessity — Burden of Proof. A plaintiffs burden of proof in an action alleging employment discrimination based on race may vary depending on the facts of the particular case; a plaintiff has a greater burden of proof where the employer is making cutbacks because of economic necessity; under such circumstances, a prima facie case of race discrimination cannot be established merely by showing that race was a factor in the employment decision; instead, the plaintiff must present sufficient evidence to establish that race was a determining factor. Fried & Levitt, P.C. (by Gary E. Levitt), for the plaintiff. Wayne State University Office of the General Counsel (by Daniel J. Bernard, Assistant General Counsel), for the defendant. Before: Marilyn Kelly, P.J., and Hood and Doctoroff, JJ. Per Curiam. These are appeals as of right from two cases that were conducted simultaneously before the same judge. The appeals were consolidated. In Docket No. 111538, plaintiff filed a complaint in the Court of Claims, alleging breach of an employment contract. This claim was heard by a Wayne Circuit Court judge sitting as the Court of Claims. Plaintiff appeals from the trial court’s ruling of no cause of action, arguing that the court erred in ruling that plaintiff failed to prove that she was discharged without cause. We affirm. In Docket No. 111557, plaintiff filed a complaint in the Wayne Circuit Court, alleging reverse race discrimination. This claim was heard by a jury, which returned a verdict in plaintiff’s favor in the amount of $1,582,000, plus interest and attorney fees. The trial court subsequently granted remittitur, reducing the damage award by $200,000. Defendant appeals, raising several issues. Defendant argues that the uncertainty of tenure is fatal to plaintiff’s claim for future wages and benefits; that the trial court erred in excluding certain evidence, in instructing the jury regarding the effect of defendant’s affirmative action policy, and in failing to grant defendant’s motions for a directed verdict and judgment notwithstanding the verdict; and that a new trial is required because of jury misconduct and inconsistent verdicts. Plaintiff cross appeals, arguing that the trial court erred in granting remittitur. We find dispositive defendant’s argument that the trial court erred in instructing the jury regarding the effect of defendant’s affirmative action policy. Accordingly, we reverse and remand for a new trial. On July 12, 1979, the university offered Gordon Smith, a black male, a position as an assistant professor in the area of guidance and counseling of the Division of Theoretical and Behavioral Foundations of the College of Education, for a two-year term. On July 23, 1979, the university offered plaintiff, a white female, the position of associate professor in the guidance and counseling area of the same division for a two-year term. Both plaintiff and Smith accepted the offers and began teaching in the fall semester of 1979. Both contracts were renewed twice more, both times for one-year terms. In November 1982, at the beginning of her fourth year with the university, plaintiff applied for tenure. On November 24, 1982, the university informed plaintiff that her contract would not be renewed and that her employment would end on August 31, 1983. Smith’s contract was renewed for another one-year term. In May 1983, plaintiff was notified that her application for tenure was denied. In Docket No. 111538, plaintiff appeals from the judgment of no cause of action entered by the Court of Claims in regard to plaintiff’s breach of contract claim. In an opinion issued on March 24, 1988, the Court of Claims concluded that in 1979 and 1981 the parties entered into legally enforceable contracts of employment which provided that plaintiff could be terminated only for just cause, that plaintiff had not proven by a preponderance of the evidence that the dean of the College of Education made all the alleged statements concerning "life time” employment, that defendant did not breach the employment contract by nonrenewal of plaintiff’s contract of employment for the 1983-84 school year, and that plaintiff had not proven by a preponderance of the evidence that she was terminated without just cause. Plaintiff asserts that the Court of Claims correctly found that a Toussaint contract existed, but that the court erred in ruling that she failed to prove by a preponderance of the evidence that her employment was terminated without just cause. Defendant argues that Toussaint does not apply to the contract at issue, but, nevertheless, that the judgment of no cause of action was correct. Where a trial court reaches the correct result for the wrong reason, the result will not be disturbed on appeal. Wilson v Acacia Park Cemetery Ass’n, 162 Mich App 638, 642; 413 NW2d 79 (1987); Dutka v Sinai Hosp of Detroit, 143 Mich App 170, 176; 371 NW2d 901 (1985). For several reasons, the judgment of no cause of action was correct. First, the contract theories articulated in Toussaint do not apply when the conduct of the parties is governed by a collective bargaining contract. Sankar v Detroit Bd of Ed, 160 Mich App 470, 478-479; 409 NW2d 213 (1987). In the instant case, a collective bargaining agreement was in force at all times. Indeed, plaintiff availed herself of the grievance and arbitration procedure set forth in the collective bargaining agreement. Second, an employee who is discharged for reasons of budget cutbacks or economic necessity does not have grounds for a wrongful discharge claim, even if the employment contract expressly provides that the employee is subject to termination only for just cause. Bhogaonker v Metropolitan Hosp, 164 Mich App 563; 417 NW2d 501 (1987); Friske v Jasinski Builders, Inc, 156 Mich App 468; 402 NW2d 42 (1986). Plaintiff concedes that in 1981 and 1982 defendant was experiencing a budget crisis which required work force reductions. In addition, the evidence overwhelmingly supports a finding that the decision not to renew plaintiffs contract was motivated by economic necessity. Third, plaintiffs contracts with defendant were for a definite term. The collective bargaining agreement, the supplement to the agreement negotiated in 1982, the university’s "statutes,” and the letters of offer and acceptance establish that the express terms of the contract created employment for the stated duration. In fact, the letters offering plaintiff one-year renewals for 1981-82 and 1982-83 specifically stated, "Please note that this appointment carries no presumption of reappointment beyond the stated time period.” Plaintiff accepted the reappointments by signing the letters. The university permitted plaintiff to serve out the term of her last contract as expressly provided and, thus, did not breach the contract. The dismissal of plaintiffs breach of contract action is affirmed. In Docket No. 111557, defendant appeals from the verdict in plaintiffs favor on her race-discrimination claim. We first address defendant’s argument that the trial court erred in instructing the jury regarding the effect of defendant’s affirmative action policy. Plaintiff asserts that defendant failed to preserve this issue for appeal. Defendant did not state its objections to the instruction immediately after the trial court finished instructing the jury. However, defendant did object to the instruction during the discussion of jury instructions that took place before the trial court instructed the jury and also raised the issue in its motion for judgment notwithstanding the verdict or a new trial. Thus, the trial court had the opportunity to consider the issue. In our view, this issue was sufficiently preserved for review. In addition, when a defect in an instruction to which no objection was made pertains to a basic and controlling issue in a case, this Court may address the error in order to avoid manifest injustice. Gallaway v Chrysler Corp, 105 Mich App 1, 6-7; 306 NW2d 368 (1981). Plaintiff’s theory in this case was that the decision not to renew her contract was based on defendant’s affirmative action policy. Plaintiff argued that the policy was invalid because it had not been approved by the Civil Rights Commission and, therefore, that any consideration of race by defendant was a violation of the law. Thus, the effect of the affirmative action policy was a basic and controlling issue in this case. If a jury charge is erroneous or inadequate, reversal is required only where failure to reverse would be inconsistent with substantial justice. MCR 2.613(A); Willoughby v Lehrbass, 150 Mich App 319, 336; 388 NW2d 688 (1986). The trial court charged the jury as follows: I instruct you that if you find that race or color was at least one of the reasons that made a difference in determining that Betty Reisman’s contract was to be non-renewed, defendant cannot avoid liability to plaintiff by claiming that the defendant’s acts were done pursuant to an affirmative action plan. The challenged instruction was based upon the interpretation of § 210 of the Civil Rights Act, MCL 37.2210; MSA 3.548(210), by the Court in JF Cavanaugh & Co v Detroit, 126 Mich App 627; 337 NW2d 605 (1983). Section 210 provides: A person subject to this article may adopt and carry out a plan to eliminate present effects of past discriminatory practices or assure equal opportunity with respect to religion, race, color, national origin, or sex if the plan is filed with the commission under rules of the commission and the commission approves the plan. In Cavanaugh, the City of Detroit passed an ordinance requiring all city contractors to take affirmative action to achieve reasonable representation of minority groups and women on their work force. Although primarily a preemption case, this Court also affirmed the trial court’s ruling that the ordinance was invalid because it conflicted with state law requiring that employers not discriminate on the basis of religion, race, color, national origin, or sex. In discussing the validity of the ordinance, the Court quoted § 210 and then stated: In view of the statute’s prohibition of discrimination, §210 implicitly precludes the use of an affirmative action plan unless the plan is "filed with the [civil rights] commission under rules of the commission and the commission approves the plan.” The nature of the interaction between nondiscrimination laws and affirmative action plans is such that we are convinced that the Legislature intended to preclude municipalities from requiring the adoption and use of plans approved only by the municipality. We also agree with plaintiffs’ contention that compliance with a city-approved affirmative action plan will not insulate an employer from charges that it violated the state’s nondiscrimination law. [126 Mich App 637-638.] The next case addressing this issue was Van Dam v Civil Service Bd of Grand Rapids, 162 Mich App 135; 412 NW2d 260 (1987). The Court in Van Dam reversed the grant of summary disposition in the defendant’s favor. The trial court had ruled that submission of an affirmative action plan for approval was not absolutely required by §210. This Court found that the trial court erred in construing the statute as giving the city discretion in submitting the plan for approval and ruled that, once a plan is initiated, it must be submitted to the Civil Rights Commission for approval before it can take effect. Citing Cavanaugh, this Court held that the defendant’s unapproved plan was invalid. See also Victorson v Dep’t of Treasury, 183 Mich App 318; 454 NW2d 256 (1990) (an unapproved affirmative action plan is invalid). A conflict in decisions developed with the release of Ruppal v Dep’t of Treasury, 163 Mich App 219; 413 NW2d 751 (1987). The trial court in Ruppal ruled that action taken pursuant to an unapproved affirmative action plan was void and discriminatory per se, and granted summary disposition for the plaintiff. This Court rejected the view that an unapproved affirmative action plan was void and discriminatory per se and reversed. The Court rejected the trial court’s reasoning, stating: There are at least two problems with this line of reasoning. First, there is nothing to suggest that an unapproved affirmative action plan is void under § 210, or that any action taken pursuant to the plan is void as discriminatory per se. Instead, failure to obtain Civil Rights Commission approval means that the plan "will not insulate an employer from charges that it violated the state’s nondiscrimination law.” J F Cavanaugh & Co v Detroit, 126 Mich App 627; 337 NW2d 605 (1983). Stated differently, protection from a lawsuit alleging discrimination cannot be guaranteed absent an approved plan. This is a far-different proposition than the trial court’s conclusion that the plan and actions taken pursuant to the plan are wholly invalid. Second, and more fundamentally, a court’s inquiry in a sex discrimination case under the Civil Rights Act does not end with a finding that the plaintiff has made out a prima facie case that sex has been taken into account in an employer’s employment decision. Once a court concludes that a plaintiff has proven a prima facie case of discrimination then the court must next consider the defendant’s explanation or justification for the presumptively discriminatory action. [163 Mich App 226-227. Emphasis in original.] The Ruppal Court, in short, ruled that the defendants could not be held liable merely because of the failure to obtain Civil Rights Commission approval of the affirmative action plan. Failure to obtain approval simply precluded the plan from serving as a statutory defense. See also Kulek v Mt Clemens, 164 Mich App 51, 64; 416 NW2d 321 (1987) (reliance on an unapproved plan will not insulate an employer from charges that it violated the state’s nondiscrimination law, "but the unapproved plan itself, and actions taken pursuant to it, are not necessarily invalid”). Where the language of a statute is clear and unambiguous, judicial interpretation is precluded, and this Court should not look beyond the ordinary meaning of the unambiguous language in giving effect to the statute. Wills v Iron Co Bd of Canvassers, 183 Mich App 797, 801; 455 NW2d 405 (1990). If construction is required, this Court is obliged to determine and give effect to the intention of the Legislature. Id. Statutory language should be given a reasonable construction considering its purpose and the object sought to be accomplished. An act must be read in its entirety, giving due consideration to all sections to produce an harmonious and consistent enactment of the whole. Id. Statutes are to be construed to avoid absurd or unreasonable consequences. Id. The overall purpose of the Civil Rights Act was stated in Miller v C A Muer Corp, 420 Mich 355, 362-363; 362 NW2d 650 (1984): Civil rights acts seek to prevent discrimination against a person because of stereotyped impressions about the characteristics of a class to which the person belongs. The Michigan civil rights act is aimed at "the prejudices and biases” borne against persons because of their membership in a certain class, Boscaglia v Michigan Bell Telephone Co, 420 Mich 308, 316; 362 NW2d 642 (1984); Freeman v Kelvinator, Inc, 469 F Supp 999, 1000 (ED Mich, 1979), and seeks to eliminate the effects of offensive or demeaning stereotypes, prejudices, and biases. We agree with the decision in Ruppal that nothing in the statute suggests that an unapproved affirmative action plan is void or that action taken pursuant to an unapproved plan is di

Mixed Result
McCluskey v. Womack
8979Apr 15, 1991Michigan

McCLUSKEY v WOMACK Docket No. 117209. Submitted June 19, 1990, at Lansing. Decided April 15, 1991, at 9:35 a.m. Martin McCluskey and others brought an action in the Macomb Circuit Court against P. Douglas Womack, Jr., alleging legal malpractice and breach of contract arising from the defendant’s performance of legal services with respect to a federal court action brought by the plaintiffs against their employer and their union. The court, Frederick D. Balkwill, J., granted partial summary disposition for the defendant, dismissing the legal malpractice claim after finding that the applicable period of limitation had expired before the plaintiffs hired the defendant to represent them. The plaintiffs sought leave to appeal, alleging that the period of limitation was tolled while the plaintiffs pursued intraunion avenues for redress of their grievance. The Court of Appeals, Hood, P.J., and Maher and Gribbs, JJ., in lieu of granting leave to appeal, agreed and reversed in an unpublished order, dated July 21, 1988 (Docket No. 106369). The Supreme Court, in lieu of granting leave to appeal, vacated the judgment of the Court of Appeals and remanded the matter to the Court of Appeals for plenary consideration as on leave granted. 432 Mich 895 (1989). The Court of Appeals held: The trial court correctly granted summary disposition for the defendant with regard to the legal malpractice claim. 1. The applicable six-month period of limitation ran from the time a final decision regarding the plaintiffs’ grievance was made or the plaintiffs discovered, or in the exercise of reasonable care should have discovered, that no further action would be taken on their grievance, even though some possibility of nonjudicial enforcement remained. Because the plaintiffs’ representative was informed that the union would not pursue their grievance further more than six months before the defendant was retained by the plaintiffs to file the federal court action regarding the grievance, the plaintiffs cannot prove that their alleged damages were caused by the defendant, and their legal malpractice claim must fail. References Am Jur 2d, Attorneys at Law §§ 118 et seq., 197 et seq.; Labor and Labor Relations §§ 475 et seq. See the Index to Annotations under Attorney or Assistance of Attorney; Labor and Employment; Limitation of Actions. 2. The running of the period of limitation was not tolled by the plaintiffs’ pursuit of nonmandatory internal remedies through their union and the union president. 3. The plaintiffs did not allege fraudulent concealment by the union; therefore, their attempt to toll the statute of limitations on that ground must fail. Affirmed and remanded. 1. Labor Relations — Limitation of Actions. Union members’ requests to their union to reconsider decisions involving grievances or for intervention by the union president generally do not toll the statute of limitations applicable to the grievance in the absence of a specific contractual provision allowing such requests. 2. Attorney and Client — Malpractice — Burden of Proof. The plaintiff in a legal malpractice action bears the burden of proving the existence of an attorney-client relationship, negligence on the part of the attorney, that that negligence proximately caused damage, and the fact and extent of the damage alleged. Chirco, Herrinton, Runstadler & Thomas (by Robert W. Morgan), and Hooper, Hathaway, Price, Beuche & Wallace (by Bruce T. Wallace), for the plaintiffs. Miller, Canñeld, Paddock & Stone (by Allyn D. Kantor, Richard J. Seryak, and Ellen M. Tickner), for the defendant. Before: Griffin, P.J., and Shepherd and Docto-ROFF, JJ. Shepherd, J. In this legal malpractice action, plaintiffs appeal the lower court’s granting of summary disposition for defendant regarding count i of plaintiffs’ complaint, which alleged professional negligence. Summary disposition with regard to this count was premised on the court’s finding that the period of limitation applicable to the underlying claim for which defendant was retained had expired before plaintiffs hired defendant to represent them. We affirm. Plaintiffs were, until January 1981, employees of Nu-Car Driveaway, Inc., which hauled and stored new cars manufactured by Chrysler Corporation. Plaintiffs were also members of Teamsters Local 299. When Nu-Car ceased operations, it was taken over by a subsidiary of Ryder Truck, RMX, Inc. Plaintiffs and other former Nu-Car employees later filed a grievance with Local 299, seeking, among other things, that the seniority lists of rmx be merged with those of other Ryder subsidiaries. Local 299 appointed Stanley Baker as plaintiffs’ business agent to pursue the grievance and Anthony Rizzo, a grievant but not a party to this action, was appointed informally by the group as its spokesperson/representative. The grievance was arbitrated on May 20, 1981, by the Teamsters Central-Southern Conference Joint Arbitration Committee, which denied plaintiffs’ request that the seniority lists be merged for layoff and recall purposes. On July 7, 1981, Rizzo gave Baker a request for rehearing of the grievance before the joint arbitration committee, citing "new evidence,” as well as a request for a hearing before the National Joint Arbitration Committee to have the latter interpret the collective bargaining agreement. The request for rehearing was denied in September 1981. On November 11, 1981, Baker informed Rizzo that the local would not pursue the request for a hearing before the National Joint Arbitration Committee. Rizzo then sent a letter, on November 13, 1981, to International Brotherhood of Teamsters General President Roy Williams, enclosing a copy of the grievance and requesting Williams’ intervention in the matter. Having not received a response, Rizzo forwarded a second letter, again requesting Williams’ intervention, on November 28, 1982. No response was given to the second letter either. In the interim, in May 1982, plaintiffs met with defendant to discuss hiring defendant to investigate the possibility of suing plaintiffs’ employer and union. Defendant was formally retained on July 13, 1982, to represent plaintiffs. On February 7, 1985, defendant filed a complaint in federal court on plaintiffs’ behalf which set forth what is commonly referred to as a "hybrid § 301” claim. Such actions typically involve a claim against an employer for violation of a collective bargaining agreement under § 301 of the Labor-Management Relations Act, 29 USC 185, and a claim against a union for breach of its duty of fair representation, which is implied under the National Labor Relations Act, 29 USC 151 et seq. That action was dismissed by stipulation and order in April 1985 after the defendants filed motions to dismiss on the basis of the expiration of the period of limitation. Plaintiffs commenced the present legal malpractice and breach of contract action against defendant in January 1986. Count i of their complaint, entitled "Legal Malpractice,” alleged that defendant failed to competently handle plaintiffs’ case by not filing the complaint within the applicable limitations period; that defendant failed to consult with plaintiffs in regard to the "strategy, compromise and settlement of the case,” in contravention of the parties’ fee agreement; and that defendant failed to "truthfully advise and honestly inform plaintiffs” of the status of their case. With respect to damages, plaintiffs averred that, as a result of defendant’s conduct, "plaintiffs’ lawful and méritorious claims against their union and employer were and are forever foreclosed with the resultant loss of continued employment and backpay awards.” In count n, plaintiffs set forth a breach of contract claim, seeking recovery of the $2,000 retainer they paid defendant. That claim is not at issue here. Summary disposition was granted to defendant pursuant to MCR 2.116(0(10). A motion for summary disposition under MCR 2.116(0(10) tests the factual support for a claim. The court must consider the pleadings, affidavits, depositions, admissions, and other documentary evidence available to it and grant summary disposition if there is no genuine issue regarding any material fact and the moving party is entitled to judgment as a matter of law. A party opposing a motion brought under rule (0(10) may not rest upon the mere allegations or denials in the party’s pleadings, but must, by affidavit, deposition, admission, or other documentary evidence, set forth specific facts showing that there is a genuine issue for trial. MCR 2.116(G)(4). See Panich v Iron Wood Products Corp, 179 Mich App 136, 139; 445 NW2d 795 (1989). As noted previously, plaintiffs’ underlying cause of action was a hybrid § 301 claim. There is no dispute here that the applicable period of limitation is six months. See DelCostello v Int'l Brotherhood of Teamsters, 462 US 151; 103 S Ct 2281; 76 L Ed 2d 476 (1983). The six-month limitation period begins to run from the time a final decision regarding the employees’ grievance has been made or from the time the employees discovered, or in the exercise of reasonable care should have discovered, that no further action would be taken with respect to their grievance. Adams v Budd Co, 846 F2d 428, 431 (CA 7, 1988), cert den 488 US 1008 (1989). This is so "even if some possibility of nonjudicial enforcement remain[s].” McCreedy v Local Union No 971, UAW, 809 F2d 1232, 1236 (CA 6, 1987), reh den 818 F2d 6 (1987), quoting Rose v General Motors Corp, 573 F Supp 747, 752 (SD Ohio, 1983). Plaintiffs contend, as they did below, that although a six-month period of limitation applies, the limitation period was tolled in this case (1) by virtue of Rizzo’s letters to the international union president, in that these amounted to good-faith efforts to resolve the dispute internally and the union constitution vested the president with authority to intervene, or (2) by their local’s alleged fraudulent conduct in handling the grievance. We agree with the trial court that neither ground tolled the running of the limitation period. Plaintiffs’ underlying cause of action accrued, at the latest, on November 11, 1982, when Rizzo was informed the local would not pursue the grievance further. Consequently, the six-month period of limitation expired in May 1982, before defendant was retained by plaintiffs to file the hybrid § 301 claim on their behalf. First, art 7, § 6 of plaintiffs’ collective bargaining agreement provided that decisions of arbitration committees, including local arbitration committees and joint conference arbitration committees, are final and binding on all parties, including the employees involved. Article XIX, § 12(C) of the Teamsters’ constitution further provided that in the case of collective bargaining matters, as here, there shall be no appeal from decisions of the joint council. Thus, neither the collective bargaining agreement nor the Teamsters’ constitution provided for, as an internal remedy that must be exhausted before filing an action in court, the seeking of the intervention of the international president. Indeed, under art XIX, § 10 of the Teamsters’ constitution, intervention by the president is limited to situations where charges involving members, officers, local unions, etc., "create, involve or relate to a situation imminently dangerous to the welfare of a Local Union, Joint Council, other subordinate body or the International Union.” More importantly, the assumption of jurisdiction by the president is discretionary. Rizzo’s letters to President Williams were merely requests that the latter intervene. If, as is the general rule, requests to reconsider decisions involving grievances do not toll the statute of limitations absent a specific contractual provision allowing the employee to make such requests, Helms v Yellow Freight System, Inc, 721 F Supp 277 (Kan, 1989); Tol v General Teamsters Union, Local No 406, 656 F Supp 300, 303 (WD Mich, 1987); Hull v Local 414, Int'l Brotherhood of Teamsters, 601 F Supp 869, 872-873 (ND Ind, 1985), it follows that requests to a union president to intervene in the absence of a specific contractual provision allowing them likewise do not toll the statute of limitations. A contrary rule would place the limitation period entirely under the control of the plaintiffs, thereby nullifying the effect of a standard statute of limitations for all hybrid § 301 claims and undermining federal policy favoring uniformity and quick resolution of labor disputes. See DelCostello, supra, 166-169; Helms, supra. Even assuming that a limited "appeal” may be taken from a grievance decision or that a grievance may be reopened because of new evidence, where, as here, the clear terms of the collective bargaining agreement provide that a majority vote of the joint committee is final and binding and there is nothing in the collective bargaining agreement expressly authorizing the employee to pursue an additional internal remedy, the pursuit of a nonmandatory remedy will not serve to toll the limitation period. By November 11, 1981, plaintiffs had exhausted all their contractual remedies and knew, via Mr. Rizzo, that the union would take no further steps to pursue their grievance. Their § 301 claim accrued then, and the six-month period of limitation began to run. To find otherwise would be to extend the limitation period indefinitely, contrary to express public policy. Summary disposition was properly granted to defendant inasmuch as the letters to President Williams did not toll the limitation period, which expired before the retention of defendant. Plaintiffs’ attempt to toll the statute of limitations on the basis of their union’s alleged fraudulent conduct is equally unavailing. Under the Michigan fraudulent-concealment statute, MCL 600.5855; MSA 27A.5855, there must be concealment by the defendant of the existence of a claim or the identity of a potential defendant. Kikos v Int’l Brotherhood of Teamsters, 526 F Supp 110 (ED Mich, 1981); Eschenbacher v Hier, 363 Mich 676, 681-682; 110 NW2d 731 (1961). Plaintiffs did not allege fraudulent concealment of their claim, but, rather, "fraudulent and deceitful conduct” on the part of the union solely with respect to its representation of plaintiffs in the grievance process. Such allegations do not assert "employment of artifice, planned to prevent inquiry or escape investigation, and mislead or hinder acquirement of information disclosing a right of action,” as fraudulent concealment was defined in De Haan v Winter, 258 Mich 293, 296; 241 NW 923 (1932), but amount only to the type of conduct plaintiffs would have been required to prove in establishing their underlying hybrid § 301 claim against their union. Moreover, Rizzo, plaintiffs’ representative, testified at his deposition that he knew on November 11, 1981, that the union would not pursue the grievance further. He therefore knew or should have known at that point of the existence of the cause of action, and the fraudulent-concealment statute, by its terms, is inapplicable. Kikos, supra; Eschenbacher, supra. The trial court therefore correctly found that the limitation period was not tolled under this theory. Plaintiffs also argue that the trial court erred in dismissing count i of their complaint in its entirety because not all of plaintiffs’ claims in that count were affected by the viability of the underlying hybrid § 301 action. We disagree. In a legal malpractice action, the plaintiff bears the burden of proving the existence of an attorney-client relationship, negligence on the part of the attorney, that that negligence proximately caused damage, and the fact and extent of the damage alleged. Adell v Sommers, Schwartz, Silver & Schwartz, PC, 170 Mich App 196, 204; 428 NW2d 26 (1988). Plaintiffs alleged in their complaint that, while defendant was retained on July 13, 1982, he did not draft a complaint until August 1983 and then did not file it until February 1985, well beyond the limitation period. They further alleged that defendant stipulated to the dismissal of the hybrid § 301 action without their consent, failed or refused to keep them apprised of the status of their case, and misled them with regard to the status. Paragraph sixteen of the complaint alleged that as a direct and proximate result of defendant’s conduct, plaintiffs’ claims against their union and employer were "forever foreclosed with the resultant loss of continued employment and backpay awards in excess of $10,000.” As discussed above, however, plaintiffs did not retain defendant until after the limitation period applicable to their underlying claim had expired. Thus, regardless of what specific acts or omissions were alleged and how egregious they may appear to plaintiffs, their legal malpractice claim must fail, because they cannot prove their alleged damages were caused by defendant. The trial court therefore correctly granted summary disposition for defendant with regard to count i plaintiffs’ complaint in its entirety. We again note, however, that plaintiffs’ breach of contract claim is still viable, by which they may seek to recover the amount they paid to defendant as a retainer. Affirmed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.

Defendant Win
McCart v. J Walter Thompson USA, Inc.
8790Apr 5, 1991Michigan

McCART v J WALTER THOMPSON USA, INC Docket No. 87309. Argued October 2, 1990 (Calendar No. 4). Decided April 5, 1991. Separate opinion by Levin, J., filed April 8, 1991. Dennis McCart brought a wrongful discharge action in the Wayne Circuit Court against J. Walter Thompson U.S.A., Inc., alleging breach of an oral contract of permanent employment terminable for just cause. The court, Robert J. Colombo, Jr., granted summary disposition for the defendant, finding that the plaintiff failed to provide any evidentiary support for the claim that he was laid off for punitive and not economic reasons. The Court of Appeals, Hood, P.J., and Beasley and Shepherd, JJ., reversed in an opinion per curiam, finding that a factual issue existed regarding the reasons for termination (Docket No. 109434). The defendant appeals. In an opinion by Chief Justice Cavanagh, joined by Justices Brickley, Boyle, Riley, and Griffin, the Supreme Court held: The plaintiff failed to show the existence of a genuine issue of fact material to his wrongful discharge claim. He presented no evidence in response to the defendant’s motion for summary disposition to demonstrate that he was not discharged for bona fide economic reasons. MCR 2.116(G)(4) requires that a party opposing a motion for summary disposition must introduce additional evidence beyond its pleadings and briefs to show that there is a genuine issue of material fact. The plaintiff completely failed to carry his burden. Bona fide economic reasons for discharge constitute just cause for termination of employment. In this case, the situation, as presented by the defendant’s proofs, amounts to no more than termination resulting from an economically motivated work-force reduction. Reversed; summary disposition reinstated. Justice Levin, writing separately, stated that there was a genuine issue of material fact whether the plaintiff’s termination was a result of a reduction of work force or was punitive, in violation of his contract of employment. While the plaintiff did not dispute the defendant’s proofs that adverse business conditions existed, he did raise a genuine issue of fact regarding whether the elimination of his position truly was based on those conditions, and there was evidence to demonstrate that he was not discharged for bona fide economic reasons. In addition, the credibility of the defendant’s president clearly was in issue. Justice Mallett took no part in the decision of this case. 181 Mich App 611; 450 NW2d 10 (1989) reversed. Eric J. McCann, P.C., for the plaintiff. Hodman, Longley & Dahling (by James J. Walsh and David P. Larsen); (Richard Pollet, of counsel), for the defendant. Amici Curiae: Miller, Canñeld, Paddock & Stone (by Diane M. Soubly and John H. Willems) for American Society of Employers, Motor Vehicle Manufacturers Association of the United States, Inc., Greater Detroit Chamber of Commerce, and Michigan State Chamber of Commerce. Conboy, Fell, Stack, Lieder & Hanson (by Lloyd C. Fell) for General Motors Corporation. Clark, Klein & Beaumont (by Dwight H. Vincent, J. Walker Henry, Rachelle G. Silberberg, and Jennifer S. Buckley) for Michigan Manufacturers Association. Mark Granzotto, Monica Farris Linkner, and Charles P. Burbach for Michigan Trial Lawyers Association. Cavanagh, C.J. Defendant J. Walter Thompson U.S.A., Inc., appeals from the Court of Appeals decision reversing the trial court’s grant of defendant’s motion for summary disposition under MCR 2.116(0(10). 181 Mich App 611; 450 NW2d 10 (1989). This Court granted defendant’s application for leave to appeal, limited to the following questions: "(1) whether there was a genuine issue of fact as to whether plaintiff’s employment was terminated for economic reasons only, and (2) assuming there was a genuine issue of fact regarding the reason(s) for the plaintiff’s discharge, was that factual issue material.” 434 Mich 911 (1990). We find that plaintiff failed to show the existence of a genuine issue of fact material to his wrongful discharge claim. Plaintiff conceded that defendant was discharging employees because of economic hardship, and presented no evidence, in response to defendant’s summary disposition motion and supporting evidence, sufficient to raise a jury question whether defendant discharged him for bona fide economic reasons. Accordingly, we reverse. I. PACTS Plaintiff was senior vice-president for defendant at the time of his termination in November 1986. He had been with defendant continuously since 1976, working the last eight years on an advertising account with Burger King Corporation. At the time of his termination, plaintiff was account director for Burger King field marketing, with an annual salary of $111,140 as of 1985. Although he resided and worked out of defendant’s offices in Michigan, he was part of defendant’s New York office. Defendant informed plaintiff that his position was being eliminated as part of a work-force reduction. Plaintiff was notified of his termination by his immediate supervisor, Robert Norsworthy. A few days later, plaintiff received a letter signed by defendant’s corporate officer, Stephen Bowen, informing plaintiff that his employment would be discontinued. Plaintiff filed a complaint against defendant in April 1987, alleging: (1) plaintiff had an oral contract for employment that could only be terminated for just cause, (2) plaintiff was fired without cause, and (3) plaintiff’s discharge was in breach of his contract with defendant. Defendant’s answer included the affirmative defense that plaintiff had been terminated as a part of its work-force reduction. After discovery, defendant filed a motion for summary disposition, alleging pursuant to MCR 2.116(0(10) that no genuine issue of material fact existed regarding whether plaintiff’s employment was terminated as part of a work-force reduction. In support of the motion, defendant offered the deposition testimony of plaintiff and Bowen, and documentary evidence relating to plaintiff’s employment history and a Burger King restaurant franchisee application. Bowen’s testimony cited economic factors affecting the company, efforts to reduce the work force in unprofitable areas, and the nonessential nature of plaintiff’s position. For purposes of its motion only, defendant conceded that plaintiff had an oral contract of permanent employment terminable only for good cause. Additionally, defendant allowed that plaintiff’s performance was not at issue. Defendant contended nonetheless that it was entitled to judgment because plaintiff’s position was eliminated for economic reasons as part of the work-force reduction, and, therefore, his termination was for nonactionable just cause as a matter of law. In opposition to defendant’s motion, plaintiff contended that (1) plaintiff’s termination had "nothing to do with the reduction in work-force,” but was actually a punitive discharge by Bowen, (2) plaintiff had a lifetime good-cause employment contract, (3) Norsworthy would testify "in support of Plaintiff’s case, and will verify the facts contained herein,” (4) defendant attempted to disguise the true nature of plaintiff’s discharge by doing it in the course of a work layoff, (5) plaintiff was offered a bonus and raise shortly before his termination, indicating his value to the company and, in a typical work-force reduction, a highly paid and valued employee would not be let go, and (6) "numerous factual disputes” existed such as the terms of the contract, the reason for discharge, and the method utilized by defendant to accomplish the discharge. Plaintiff conceded, however, that defendant was, at the time, reducing its work force for economic reasons. The trial court granted defendant’s motion for summary disposition. Citing MCR 2.116(G)(4), which requires that the adverse party on a motion for summary disposition must introduce additional evidence beyond its pleadings and briefs to show there is a genuine issue of material fact, the court held: "Plaintiff has failed to provide any evidentiary support for his claim that he was laid off for punitive reasons and not economic reasons.” The Court of Appeals reversed, reasoning that although "there is nothing in the record to indicate that plaintiff’s position was terminated for reasons other than economic motivation,” 181 Mich App 616, the evidence did not show that plaintiff was hired only for the one position he had held, and that plaintiff had cited certain incidents which allegedly contributed to Bowen’s dislike of him. The Court held that "the employer must establish economic motivation to terminate the particular employee, as opposed to the employee’s position, where the employee has a just cause contract and the employer has reasonable alternative options for the employee within the organization.” Id. at 617-618. The Court concluded that "[b]ecause we are unable to say that it will be impossible for plaintiff to factually support his position at trial, we hold that the grant of summary disposition was inappropriate.” Id. at 618. II. ANALYSIS Plaintiff argues that this Court’s decision in Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), governs this dispute. In Toussaint, this Court held that an employee may have an enforceable right not to be terminated except for just cause, grounded in either an express oral or written contract or in legitimate expectations arising from an employer’s policy statements. See id. at 598-599. We conclude, however, as the Court of Appeals has held, that bona fide economic reasons for discharge constitute "just cause” under Toussaint. See Friske v Jasinski Builders, Inc, 156 Mich App 468, 472; 402 NW2d 42 (1986); Bhogaonker v Metropolitan Hosp, 164 Mich App 563, 565-566; 417 NW2d 501 (1987). In the instant case, while plaintiff alleges that Bowen disliked him, he has failed to raise any genuine issue of fact regarding the validity of defendant’s proofs that adverse business conditions existed and that the elimination of plaintiff’s position was necessitated by those conditions. Indeed, plaintiff conceded that defendant was instituting layoffs for economic reasons at the time. The objective circumstances, as presented by defendant’s proofs, indicate no more than a termination resulting from an economically motivated workforce reduction. "When properly challenged, plaintiff must establish that he has a case on the law and that there are some evidentiary proofs to support his allegations as to any material fact.” Durant v Stahlin, 375 Mich 628, 638; 135 NW2d 392 (1965). Under MCR 2.116(G)(4), a party opposing a motion for summary disposition is required to respond with affidavits or other evidentiary materials to show the existence of a factual dispute, rather than relying on the allegations or denials in the pleadings. In this case, plaintiff did not specify any facts in opposition to defendant’s motion in any "Affidavits, depositions, admissions, or other documentary evidence,” MCR 2.116(G)(3), instead simply stating in his responsive pleading that he would produce at trial evidence that defendant’s economic necessity rationale was a pretext. This case thus stands in marked contrast to the recent Court of Appeals decision in Ewers v Stroh Brewery Co, 178 Mich App 371; 443 NW2d 504 (1989), where "plaintiff relied on deposition and documentary evidence which he argued indicated that defendant was experiencing substantial economic growth and operating at a substantial profit before and after his discharge.” Id. at 375. Because plaintiff failed to carry his burden under MCR 2.116(G)(4), we need not address the issue discussed by the Court of Appeals regarding whether the defendant must demonstrate economic reasons not only for the elimination of a just-cause employee’s position, but for the termination of the employee as an individual as well. See 181 Mich App 617-618. In the absence of any sufficient response from plaintiff, defendant’s proofs in this case were adequate to support summary disposition on the ground that plaintiff’s termination was for bona fide economic reasons. The following opinion was filed with the Clerk of the Supreme Court on April 8, 1991, after the release of the opinion of the Court on April 5,1991 — Reporter. III. conclusion For the reasons stated, we reverse the judgment of the Court of Appeals and reinstate the trial court’s grant of summary disposition for defendant. Brickley, Boyle, Riley, and Griffin, JJ., concurred with Cavanagh, C.J. Levin, J. Dennis McCart was a senior vice president of J. Walter Thompson U.S.A., Inc., an advertising agency. McCart commenced this action against J. Walter Thompson after he was discharged from his employment in November, 1986. McCart claimed that J. Walter Thompson had agreed that he could not be discharged except for good cause, and that his employment was terminated without good cause. J. Walter Thompson moved for summary disposition on the ground that there was no genuine issue as to any material fact. For purposes of the motion, J. Walter Thompson did not dispute McCart’s contention that he had an "oral contract for permanent employment that could be terminated only for good cause.” J. Walter Thompson asserted that it was entitled to a judgment of dismissal because "it is not disputed” that McCart’s employment was terminated when his position was eliminated "as part of a reduction in force.” i J. Walter Thompson’s assertion that there is no genuine issue whether McCart’s employment was terminated when his position was eliminated as part of a reduction in force is, in a sense, undisputed. The timing of the termination of his employment did, indeed, coincide with a reduction in the work force and the discharge of a number of other employees. McCart did, however, dispute whether the reason for his discharge was a reduction in work force. McCart asserted, in an answer to J. Walter ■Thompson’s motion, that the termination of his employment "had nothing to do with the reduction in work force, but was a punitive discharge by Defendant’s President, Steve Bowen, in violation of Plaintiff’s contract of employment.” McCart asserted that J. Walter Thompson had "attempted to disguise Plaintiff’s discharge by doing it in the course of a work reduction layoff, but such attempt was a ruse.” McCart added that he would "produce[] the testimony of his former boss, Robert Norsworthy, who will testify in support of Plaintiff’s case, and will verify the facts contained herein.” ii The majority faults McCart because he did not file an affidavit or other evidentiary materials, but "simply statfed] in his responsive pleading that he would produce at trial evidence that defendant’s economic necessity rationale was a pretext,” and concludes that McCart "failed to carry his burden” under the court rule. Motions for summary disposition asserting that there is no genuine issue as to any material fact are, indeed, generally supported and opposed with affidavits. The court rule does not, however, require that the motion be supported or opposed in all events by affidavit. The court rule states, rather, that the showing required by an opposing party cannot be made by "resting] upon the mere allegations or denials of his or her pleading . . . .” (Emphasis added.) The showing must be made, instead, "by affidavits or as otherwise provided in this rule . . . ,” The rule provides that "affidavits, depositions, admissions, or other documentary evidence may be submitted by a party to support or oppose the grounds asserted in the motion.” hi J. Walter Thompson pleaded as an affirmative defense that McCart’s "employment was terminated as part of a contraction of defendant’s work force.” The standard jury instructions, applicable in a "wrongful discharge” case, provide that where the plaintiff has carried his burden of showing that the employment relationship could not be terminated except for good or just cause, "[t]he defendant [J. Walter Thompson] has the burden of proving that it had good or just cause to terminate the plaintiff’s employment.” The question then arises whether it is J. Walter Thompson’s burden to show that the asserted good or just cause — reduction in work force/economic necessity — was not, as McCart asserts, pretextual. In an employment discrimination case, the plaintiff has the burden of establishing discrimination, whether it be discrimination based on age, religion, race, or sex. When the plaintiff proffers prima facie evidence of discrimination, the employer must then offer a reason for its action or nonaction negating age, religious, racial, or sexual discrimination. The plaintiff-employee may assert that the reason is pretextual, but nevertheless continues to have the ultimate burden of showing and persuading the trier of fact that there was discrimination. J. Walter Thompson, which has the ultimate burden of proving its reduction in work force/ economic necessity affirmative defense, may, as an aspect of that burden, similarly have the burden of proving that the reason for discharging McCart was its stated reason, economic necessity, and not personal animus. The burden on a party, such as McCart, opposing a motion for summary disposition, is to show that there is a genuine issue as to an essential element of the opposing party’s case. If the bona fides of the asserted good cause — the absence of pretext — is an essential element of J. Walter Thompson’s case, and J. Walter Thompson has the burden of proving that essential element, it is entitled to summary disposition only if it, not McCart, establishes that there is no genuine issue whether McCart was discharged because of economic necessity or personal animus. The parties have neither briefed nor argued the question whether the ultimate burden of proof and persuasion on the issue of good cause remains with the defendant in a "wrongful discharge” case where the defendant asserts as an affirmative defense good or just cause on the basis of reduction in force/economic necessity and the plaintiff contends that this is pretextual. IV Summary disposition is not appropriate when the moving party’s factual assertions depend on the credibility of a witness. The United States Supreme Court has said, in this context, that an affiant who, like Bowen, was an officer of the moving party was "clearly an interested witness” requiring " 'the credibility of his testimony to be submitted to the jury as a question of fact.’ ” Sartor v Arkansas Natural Gas Corp, 321 US 620, 624, 628; 64 S Ct 724; 88 L Ed 967 (1944). MCR 2.116(0(10), "no genuine issue as to any material fact,” is derived word for word from corresponding FR Civ P 56. The advisory committee on the federal rule stated: Where an issue as to a material fact cannot be resolved without observation of the demeanor of witnesses in order to evaluate their credibility, summary judgment is not appropriate. J. Walter Thompson’s assertions that McCart was discharged as part of a work-force reduction, necessitated by the need to economize and reduce overhead, and was not prompted by personal animus, depends entirely on the credibility of Stephen Bowen’s testimony on deposition. McCart was not discharged in accordance with the terms of a facially neutral plan for determining who should be discharged. It appears that Bowen ordered that McCart be discharged, and then left it to Robert Norsworthy, McCart’s immediate superior, to determine how the rest of the work-force reduction would be achieved. Bowen’s assertions in his deposition that he directed that McCart be discharged only because of economic necessity, that he bore McCart no ill will, and that McCart was not discharged because of personal animus, constituted assertions regarding Bowen’s state of mind when he ordered McCart discharged. This Court has said that in such a case summary disposition may not be granted: The probative value of a witness’s testimony as to his own state of mind depends upon his credibility, a

Defendant Win
Scholz v. Montgomery Ward & Co.
8790Apr 5, 1991Michigan

SCHOLZ v MONTGOMERY WARD & CO, INCORPORATED Docket No. 80709. Argued October 2, 1990 (Calendar No. 1). Decided April 5, 1991. Jane Scholz brought an action in the Kent Circuit Court against Montgomery Ward & Co., Incorporated, alleging age and religious discrimination and breach of contract. The plaintiff claimed that oral assurances by the defendant at the time of hiring that she would not be required to work on Sundays modified her subsequent written acknowledgment by completing a sign-off sheet supplied by the employer that she was an employee at will. The court, George R. Cook, J., entered judgment on a jury verdict for the plaintiff. Following trial, the defendant’s motions for judgment notwithstanding the verdict or for a new trial were denied. The Court of Appeals, Burns, P.J., and Gribbs and R. I. Cooper, JJ., affirmed the rulings on the motions in an unpublished opinion per curiam, reasoning that Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980), does not permit an employer to unilaterally modify a contract, and concluding that because the question whether the defendant retained the right to unilaterally change the terms of the oral agreement with the plaintiff not to work on Sundays was one of fact, the jury reasonably could have concluded that the oral agreement remained in force (Docket No. 86118). The defendant appeals. In an opinion by Justice Riley, joined by Chief Justice Cavanagh and Justices Brickley, Boyle, and Griffin, the Supreme Court held: The signing by an employee of a disclaimer providing employment at will, unless subsequently modified, permits termination of the employee for any or no reason. 1. Employers may provide employment at will by way of express disclaimers in statements of employment policies. In this case, as a matter of law, the plaintiff’s employment relationship at the time of discharge was governed by the employer’s disclaimer. Thus she was an employee at will, and unable to maintain an action for wrongful discharge. 2. Failure to obtain an explanation of a contract is ordinary negligence, estopping avoidance of the contract on the ground of ignorance. In this case, the plaintiff assented to the terms of the employment agreement by signing the sign-off sheet and returning it to her employer. The disclaimer included in the sign-off sheet was unambiguous on the subject of discharge and comprehensive on the subject of termination. Regardless of whether an implied contract arose with respect to Sunday work, as a matter of law, it did not apply at the time of discharge because the express modified contract under the terms of the sign-off sheet was in effect at the time of her discharge. Affirmed in part, reversed in part, and remanded for entry of judgment notwithstanding the verdict. Justice Levin, writing separately, stated that modification of an employment contract, in general, is subject to the same rules of law applicable to the modification of other contracts. These rules seek to achieve a reasoned balance between competing values and policies and to protect and enforce the true agreement. There are no special rules of law designed to lighten the burden of an employer who seeks to modify an express oral agreement. Employers have full freedom of contract and managerial control; however, when they enter into an agreement with an employee, they give up something and generally obtain something worthwhile in return. The law recognizes the utility of and the employer’s need for standardized agreements. Where, however, as in this case, before an agreement is standardized, a separate agreement is entered into with a person with whom a standardized agreement is later signed, rules of law designed to protect the enforceability of the earlier agreement of the parties come into play, if it appears, on an examination of all the facts and circumstances, that it continues to represent the true agreement of the parties. These rules should not be brushed aside or ignored. Justice Mallett took no part in the decision of this case. Pinsky, Smith, Fayette & Hulswit (by H. Rhett Pinsky) for the plaintiff. Dykema, Gossett (by Charles C. DeWitt, Jr., and Bruce G. Davis) for the defendant. Amici Curiae: Clark, Klein & Beaumont (by Dwight H. Vincent, J. Walker Henry, and Rachelle G. Silberberg) for Michigan Manufacturers Association. Conboy, Fell, Stack, Lieder & Hanson (by Lloyd C. Fell) for General Motors Corporation. Miller, Canñeld, Paddock & Stone (by Diane M. Soubly) for American Society of Employers, Motor Vehicle Manufacturers Association of the United States, Inc., Greater Detroit Chamber of Commerce, and Michigan State Chamber of Commerce. Mark Granzotto, Monica Farris Linkner, and Charles P. Burbach for Michigan Trial Lawyers Association. Sommers, Schwartz, Silver & Schwartz, P.C. (by Lionel J. Postic), and Charles Gottlieb for Michigan Employment Lawyers Association. Riley, J. I. INTRODUCTION AND FACTS This case is a wrongful discharge/religious discrimination action brought against the defendant, Montgomery Ward & Co., Incorporated, by Jane Scholz, a- former employee of defendant at its North Kent Mall Store in Grand Rapids, Michigan. The Court held in abeyance defendant’s application for leave to appeal pending decisions in Bullock v Automobile Club of Michigan, 432 Mich 472; 444 NW2d 114 (1989), and In re Certified Question, Bankey v Storer Broadcasting Co, 432 Mich 438; 443 NW2d 112 (1989). On May 2, 1990, we granted leave to appeal. The sole issue to be decided in this appeal is whether plaintiff had a contract not to be terminated for refusing to work on Sundays on the basis of oral statements and circumstances surrounding her employment. We hold, as a matter of law, that at the time of her discharge plaintiff’s employment relationship was governed by the employer’s 1982 sign-off sheet, and that plaintiff was an employee at will. Thus, plaintiff cannot maintain an action for wrongful discharge. Accordingly, the decision of the Court of Appeals is reversed to the extent it found that plaintiff could bring an action for breach of contract, and the case is remanded to the trial court for entry of an order pursuant to this opinion. The facts of this case are set forth in the Court of Appeals decision, unpublished opinion per curiam of the Court of Appeals, decided January 27, 1987 (Docket No. 86118): Plaintiff was hired by defendant as a sales person on August 31, 1970, at defendant’s location at the North Kent Mall in northern Kent County. At the time of her hiring, she discussed Sunday working hours with the personnel director, Donald Hansen. At that time, the North Kent Mall store was not open for business on Sundays. Nevertheless, plaintiff indicated her desire not to work on Sundays. Hansen took the matter up with the store manager, Robert Bergman. Bergman indicated that, although he did not anticipate the store opening on Sundays, there would be no difficulty in honoring plaintiff’s request in the event the store opened on Sundays. Hansen relayed this decision to plaintiff, who accepted a position with defendant. Four or five months later, the store opened for Sunday trade. Two years after that, plaintiff was asked to work on Sundays. She refused, citing religious convictions. The matter was dropped. Sometime later, in 1977, plaintiff was formally notified by defendant that she would have to work on Sundays. Plaintiff’s pastor, Wesley A. Samuelson of Bethlehem Lutheran Church in Grand Rapids, sent a letter to defendant indicating that plaintiff’s religious convictions prevented her from working on Sundays. Although she was scheduled to work three Sundays in 1977, she refused. No action was taken by defendant. In 1982, defendant issued a policy manual. On the face of the manual, there was a sheet entitled "new employees sign-off sheet,” which plaintiff signed on May 10, 1982. That sheet contained, inter alia, the following paragraph: "I have read and fully understand the rules governing my employment with Montgomery Ward. I agree to employment with Montgomery Ward under the conditions explained. I understand these conditions can be changed by the Company, without notice, at any time. I also understand and agree that my employment is for no definite period and may, regardless of the time and manner of payment of my wages and salary, be terminated at any time, with or without cause, and without any previous notice.” In 1983, plaintiff was informed that if she refused to work on Sundays, she would be terminated. She responded by letter that it was her understanding at the time of hiring that she would not be required to work on Sundays. She was scheduled for work on Sundays, she refused to work on Sundays, and she was terminated. Defendant admits plaintiff had an excellent work record and that the sole reason for her discharge was her failure to report for Sunday work. [Slip op, pp 1-2.] Plaintiff brought suit in Kent Circuit Court on January 16, 1984, against Montgomery Ward, alleging age and religious discrimination and breach of contract. A jury awarded her $8,250 on the religious discrimination claim and $16,503 on the breach of contract claim, plus costs, interest, and attorney fees. Scholz, supra, slip op, p l. Following the trial, defendant moved for a judgment notwithstanding the verdict or, in the alternative, for a new trial. The trial court denied both motions. Defendant appealed, and the Court of Appeals affirmed the trial court’s ruling on the motions, reasoning that Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), reh den 409 Mich 1101 (1980), does not permit an employer to unilaterally modify a contract. Scholz, supra, slip op, p 4. The Court of Appeals concluded that since the question whether defendant retained the right to unilaterally change the terms of the oral employment contract with plaintiff was one of fact for the jury and not one of law for the trial court, the jury reasonably could have concluded that provisions of the 1970 oral contract remained in force. Therefore, the trial court properly denied the motion for judgment notwithstanding the verdict and similarly did not abuse its discretion in refusing to grant a new trial. Scholz, supra, slip op, pp 5-6. ii A In Toussaint, we recognized that employers may provide a contract of employment at will by way of express disclaimers in their employment policies. In Valentine v General American Credit, Inc, 420 Mich 256, 258-259; 362 NW2d 628 (1984), we reaffirmed: Employers and employees remain free to provide, or not to provide, for job security. Absent a contractual provision for job security, either the employer or the employee may ordinarily terminate an employment contract at any time for any, or no, reason. In the instant case, plaintiff relies on the prehiring statements made by Mr. Hansen, Montgomery Ward’s personnel director, to allege an express contract that she was not required to work Sundays. Plaintiff also relies on several instances during her employment where defendant acquiesced in her refusal to work Sundays. Even if we were to assume plaintiff had an express oral contract with Montgomery Ward that she did not have to work on Sundays, she reached a new understanding with Montgomery Ward governing the terms of her employment status once she signed the disclaimer providing employment at will in May of 1982. Montgomery Ward took action which we expressly approved of in Toussaint and entered into a contract with plaintiff making her employment terminable at will. On the basis of this agreement, Montgomery Ward properly terminated plaintiff’s employment. This case is analogous to Ledl v Quik-Pik Stores, 133 Mich App 583; 349 NW2d 529 (1984). In Ledl, the plaintiff was given assurances at the time she accepted employment that she would continue to be employed as long as her performance was satisfactory. Approximately seven and one-half years after being hired, she signed an employment agreement which provided that the defendant could terminate her employment with or without cause. The Court of Appeals concluded that the plaintiff failed to state a claim for breach of an employment contract because the language of the contract negated any prior oral agreements she may have had that were based on her employer’s assurances. In the instant case, on May 16, 1982, thirteen years after plaintiff was hired, she signed an employment agreement which provided that her employment was at will. A closely related sign-off sheet was involved in Dell v Montgomery Ward & Co, Inc, 811 F2d 970 (CA 6, 1987). In Dell, the plaintiff alleged a breach of contract claim under Toussaint against Montgomery Ward after being fired for deceptively covering up the wrongful conduct of one of his subordinates. The plaintiff executed the sign-off sheet, expressly acknowledging that his employment was at will and was terminable with or without just cause. The trial court granted the defendant’s motion for summary judgment. On appeal, the United States Court of Appeals for the Sixth Circuit affirmed the trial court’s ruling on the Toussaint issue. Writing for the court, Judge Ryan concluded: It is difficult to imagine what more the defendant might have done to make it crystal clear to Dell, and all Montgomery Ward employees, that, unless some other arrangement were made directly with the President and Chief Executive Officer or Executive Vice President of Human Resources, Montgomery Ward employees are employees "at will” who may be discharged with or without cause. [Id., p 974. See also Haas v Montgomery Ward & Co, Inc, 812 F2d 1015 (CA 6, 1987).] Plaintiff argues that although she read and understood the written employment-at-will agreement, she did not believe it applied to her Sunday work arrangement. Plaintiff contends that because mutual assent is lacking, the executed sign-off sheet defining her status as an employee at will did not alter the fact that she would not be terminated for refusing Sunday employment. It is well settled that the failure of a party to obtain an explanation of a contract is ordinary negligence. Accordingly, this estops the party from avoiding the contract on the ground that the party was ignorant of the contract provisions. As this Court has previously held: The stability of written instruments demands that a person who executes one shall know its contents or be chargeable with such knowledge. If he cannot read, he should have a reliable person read it to him. His failure to do so is negligence which estops him from voiding the instrument on the ground that he was ignorant of its contents, in the absence of circumstances fairly excusing his failure to inform himself. [Sponseller v Kimball, 246 Mich 255, 260; 224 NW 359 (1929).] If plaintiff did not understand the terms of the sign-off sheet, she had a duty to inquire about its contents. The record does not reflect any attempt by plaintiff to find out whether or not she was excused from Sunday employment under the terms of the disclaimer. In any case, we find the disclaimer unambiguous on the subject of discharge and comprehensive on the subject of termination. It does not suggest that she was immune from discharge for refusing Sunday work. In sum, Montgomery Ward took the action expressly approved in Toussaint and entered into a contract with plaintiff making her employment terminable at will. Plaintiff assented to the terms of the employment agreement by signing the sign-off sheet and returning it to Montgomery Ward. Upon the basis of this agreement, Montgomery Ward terminated plaintiff’s employment. Therefore, regardless of whether an express oral contract actually existed at the time of her hiring, as a matter of law, plaintiff and Montgomery Ward later reached a mutual understanding with regard to termination through the sign-off sheet. We find that plaintiff’s employment with Montgomery Ward was, as a matter of law, an employment-at-will relationship. Therefore, plaintiff cannot prevail in her breach of contract action. B Plaintiff also argues that defendant acquiesced in her refusal to work Sundays, thus creating a contract implied in fact that she not be terminated for such refusal. Regardless of whether an implied contract arose, as a matter of law, it did not apply to plaintiff at the time she was discharged because the express modified contract under the terms of the sign-off sheet was in effect at the time of her discharge. An implied contract cannot be enforced where the parties have made an express contract covering the same subject matter. In re De Haan Estate, 169 Mich 146; 134 NW 983 (1912); Steele v Cold Heading Co, 125 Mich App 199, 202-203; 336 NW2d 1 (1983); Hickman v General Motors Corp, 177 Mich App 246, 251; 441 NW2d 430 (1989). Under the rule set forth above, plaintiff cannot prevail on her claim for breach of contract. III. CONCLUSION Our decision recognizes that once a disclaimer providing employment at will is signed by an employee, excepting any subsequent modification, the employee may be terminated for any, or no, reason. Thus, in the present case, plaintiff cannot prevail on a claim for breach of contract. The decision of the trial court and Court of Appeals is reversed with regard to the breach of contract claim, and a judgment notwithstanding the verdict shall be entered. However, we affirm the trial court’s ruling on the religious discrimination issue because of defendant’s failure to object to the instructions given at trial. We do not retain jurisdiction. Cavanagh, C.J., and Brickley, Boyle, and Griffin, JJ., concurred with Riley, J._ Levin, J. The jury found that Montgomery Ward —agreed that Jane Scholz would not be required to work on Sunday, and —wrongfully discharged her when she refused to work on Sunday. The majority does not challenge the jury’s findings of fact. It states rather that "[e]ven if we were to assume plaintiff had an express oral contract with Montgomery Ward that she did not have to work on Sundays,” a contract Scholz claimed was entered into when she was hired, Scholz subsequently reached a "new understanding” with Montgomery Ward, in May, 1982, when she signed the sign-off sheet, "governing the terms of her employment status” and providing for employment at will. (Ante, pp 89-90.) The majority concludes that because Scholz was an employee at will she cannot maintain an action for wrongful discharge. It affirms the verdict for Scholz on the religious discrimination claim, and to that extent I concur. I The "new understanding” is embodied in the following paragraph of the "new employee sign-off sheet” that Scholz was asked to and did sign in May, 1982, although she was not a new employee: I have read and fully understand the rules governing my employment with Montgomery Ward. I agree to employment with Montgomery Ward under the conditions explained. I understand these conditions can be changed by the Company, without notice, at any time. I also understand and agree that my employment is for no definite period and may, regardless of the time and manner of payment of my wages and salary, be terminated at any time, with or without cause, and without any previous notice. Scholz testified that she did not understand that by signing the sign-off sheet she could be required to work on Sundays. Scholz argued that the rules and regulations in the Welcome to Montgomery Ward Handbook that accompanied the new employee sign-off sheet had nothing to do with Scholz’ "other agreement,” entered into when she was hired, whereby she had conditioned her employment on not working on Sundays, and to which Montgomery Ward had agreed. ii The facts are essentially undisputed. This is not a case where the testimony of the witnesses for the employer differed significantly from the testimony of the employee’s witnesses. Employer claims that juries are inclined to be sympathetic to employees, and, on that basis, in defiance of the evidence, resolve against employers

Mixed Result$8,250 awarded
Turner
N.D. Ga.Mar 25, 1991Georgia
Defendant Win
Rodgers
E.D. Mich.Feb 12, 1991Michigan
Defendant Win
Anderson
E.D. Mich.Feb 5, 1991Michigan
Defendant Win
Kauffman v. Chicago Corp.
8979Feb 4, 1991Michigan

KAUFFMAN v THE CHICAGO CORPORATION Docket Nos. 117155, 125965. Submitted October 12, 1990, at Detroit. Decided February 4, 1991, at 9:00 a.m. Leave to appeal sought. Keith L. Kauffman, a registered stockbroker, brought an action in the Oakland Circuit Court against The Chicago Corporation, Paul Greening, and Michael Purcell, alleging breach of an employment contract, wrongful discharge, and defamation. The court, Fred M. Mester, J., found that the plaintiff, in registering with the New York Stock Exchange, had agreed to submit to arbitration any claims arising out of the termination of his employment. A final order compelling the arbitration of the breach of contract and wrongful discharge claims was entered, and the plaintiff appealed as of right from that order. The court also entered an order denying the defendants’ motion to compel the arbitration of the defamation claim. The defendants appealed by leave granted. The appeals were consolidated. The Court of Appeals held: 1. The federal arbitration act, 9 USC 1-15, governs actions in both the federal and state courts arising out of contracts involving interstate commerce, including disputes between a member of a national stock exchange and its employees if there is a binding arbitration agreement. The plaintiff signed an agreement to arbitrate any claim arising between plaintiff and his firm or customers, as required under the rules governing the New York Stock Exchange. The defendant corporation had the right to enforce the agreement and the trial court did not err in compelling arbitration as a matter of law. That order is affirmed. The trial court properly found that the plaintiff agreed to the arbitration of the claims arising out of the termination of his employment. However, the court erred in failing to order arbitration of the plaintiff’s defamation claim. 2. A posttermination defamation claim is arbitrable under _NYSE Rule 347 if it involves significant aspects of the employment relationship, i.e., those claims which depend upon an evaluation of a party’s performance either as a broker or as an employer of brokers during the time of the contractual relationship. The statements at issue relate to the plaintiff’s performance, his dealings with customers, and his skills as a manager. The statements therefore are related to the employment relationship and are arbitrable. References Am Jur 2d, Arbitration and Award §§ 6, 42. See the Index to Annotations under Arbitration and Award; Discharge from Employment or Office; Exchanges and Boards of Trade; Stockbrokers. 3. The defendants did not waive their right to arbitration as a result of their participation in the litigation in circuit court and have not acted inconsistently with their claim of the right to arbitration, requiring reversal of the order denying the defendants’ motion to compel arbitration of the defamation claim and remand for entry of an order compelling arbitration of the defamation claim. Affirmed in part, reversed in part, and remanded. 1. Arbitration — Federal Arbitration Act — National Stock Exchanges. The federal arbitration act governs actions in both federal and state courts between a member of a national stock exchange and its employees where there is a binding arbitration agreement; questions regarding the existence of a contract containing a binding arbitration agreement are governed by general contract principles found in state law (US Const, art VI, § 2, 9 USC 1-15). 2. Arbitration — National Stock Exchanges — Posttermination Defamation Claims. Under New York Stock Exchange Arbitration Rule 347 a claim by a stockbroker against a former employer for posttermination defamation is arbitrable where it involves significant aspects of the employee’s job performance and the communications at issue are the sort that an employer foreseeingly would make upon an employee’s termination. 3. Arbitration — Federal Policy — Waiver of Rights. Federal policy strongly favors enforcement of arbitration agreements; where waiver of a contractual right to arbitration is alleged, the party opposing arbitration must demonstrate knowledge of an existing right to compel arbitration, acts inconsistent with the right, and prejudice to the party opposing arbitration resulting from the inconsistent acts. Barlow & Lange, P.C. (by Thomas W. H. Barlow and Donna A. Lavoie), for the plaintiff. Marietta S. Robinson, and Arnstein & Lehr (by Michael R. Turoff and Hal R. Morris), for the defendants. Before: McDonald, P.J., and Hood and Reilly, JJ. McDonald, P.J. These consolidated appeals arise out of plaintiffs suit for breach of an employment contract, wrongful discharge, and defamation. In Case No. 117155 plaintiff appeals from a June 14, 1989, order making final a February 22, 1989, order compelling arbitration of plaintiff’s breach of employment contract and wrongful discharge claims. In Case No. 125965 defendants appeal from a January 17, 1990, order denying their motion to compel arbitration of plaintiff’s defamation claim. We affirm in part and reverse in part. Plaintiff claims the trial court erred in finding he agreed to arbitration of the claims arising out of the termination of his employment. We disagree. The federal arbitration act, 9 USC 1-15, governs actions in both federal and state courts arising out of contracts involving interstate commerce. Southland Corp v Keating, 465 US 1; 104 S Ct 852; 79 L Ed 2d 1 (1984); Scanlon v P & J Enterprises, 182 Mich App 347; 451 NW2d 616 (1990). More specifically, disputes between a member of a national stock exchange and its employees are within the federal act if there is a binding arbitration agreement. Coenen v R W Pressprich & Co, Inc, 453 F2d 1209 (CA 2, 1972). State courts are bound under the Supremacy Clause, US Const, art VI, § 2, to enforce the substantive provisions of the federal act. Scanlon, supra. The only question presented by plaintiff is whether he agreed to submit to arbitration all claims arising out of his employment and the termination of his employment. The question regarding the existence of a contract is governed by general contract principles found in state law. Plaintiff signed the Uniform Application for Securities Industry Registration form that included a provision indicating plaintiff’s agreement to arbitrate any dispute, claim, or controversy arising between plaintiff and his firm or customers, as required under the rules of any stock exchange. Additionally plaintiff concedes that he registered with the New York Stock Exchange. New York Stock Exchange Arbitration Rule 347 requires arbitration of disputes "arising out of the employment or termination of employment.” Because plaintiff admits that he was a broker registered with the New York Stock Exchange, his reliance on Brown v Merrill Lynch, Pierce, Fenner & Smith, Inc, 664 F Supp 969 (ED Pa, 1987), is misplaced. Additionally, plaintiff’s contention that his employment agreement with the defendant corporation superseded any agreement contained in the securities application must fail. The submission of the application was a pledge that plaintiff would abide by the constitutions, rules and bylaws of any exchange of which he became a member. Coenen, supra. Those constitutions, rules, and bylaws in turn constitute a contract by all members of the exchange with each other and with the exchange itself. Together, they evidence an enforceable agreement to arbitrate disputes defined by those rules. Coenen, supra. Thus, the defendant corporation, a member of the exchange, had the right to enforce the agreement. The only issues material to compelling arbitration were whether plaintiff signed the form containing the arbitration agreement and whether plaintiff registered with one of the exchanges. There being no dispute regarding either of these issues, the trial court did not err in compelling arbitration as a matter of law. MCR 3.602(B)(3). On appeal, defendants claim the trial court erred in failing to order that plaintiffs defamation claim must be arbitrated. We agree. The arbitrability of posttermination defamation claims under Arbitration Rule 347 of the nyse has been the subject of much litigation in the federal courts. See Fleck v E F Hutton Group, Inc, 891 F2d 1047 (CA 2, 1989), and cases cited therein. The rule provides as follows: Any controversy between a registered representative and any member or member organization arising out of the employment or termination of employment of such registered representative by and with such member or member organization shall be settled by arbitration, at the instance of any such party, in accordance with the arbitration procedure prescribed elsewhere in these rules. Defendants contend this rule, and the cases construing it, requires arbitration of virtually any claim of posttermination defamation concerning a member-employee by a member-employer. Plaintiff contends the same cases require arbitration only of those claims which arise out of the employment contract or require evaluation of the claimant’s performance as a broker. We find defendants’ interpretation too broad and plaintiffs too narrow a reading of the cases. In Fleck, the second circuit rejected its own decision in Coudert v Paine Webber Jackson & Curtis, 705 F2d 78 (CA 2, 1983), and adopted instead the test developed by the eighth circuit in Morgan v Smith Barney, Harris Upham & Co, 729 F2d 1163 (CA 8, 1984). The test previously had been adopted in the ninth and sixth circuits. Zolezzi v Dean Witter Reynolds, Inc, 789 F2d 1447 (CA 9, 1986); Aspero v Shearson American Express, Inc, 768 F2d 106 (CA 6, 1985). This test of arbitrability, as gleaned by the court in Fleck from its reading of Morgan and Aspero, is whether the claim involves significant aspects of the employment relationship, that is, those claims for which resolution depends upon evaluation of a party’s performance either as a broker or as an employer of brokers during the time of the contractual relationship. Fleck, p 1053. A dispute may be arbitrable under this rule even if it does not involve customer accounts or broker-dealer functions, as long as it raises a significant issue of the claimant’s job performance. Pearce v E F Hutton Group, Inc, 264 US App DC 246; 828 F2d 826 (1987). The timing of the tort, whether the statements were made during or after the claimant’s employment, is relevant to whether the tort arose out of the employment relationship, but is not determinative. Fleck, p 1052. The more pertinent inquiry is whether the statements were made during communications of the sort that an employer would foreseeably make upon an employee’s termination. Applying these principles to the facts in this case, we find plaintiff’s defamation claim to be arbitrable. The circuit court denied defendants’ first motion to compel arbitration of the defamation claim, finding: [T]he claim of defamation is so dissimilar to the other three (3) counts that it was not contemplated by the parties when executing the arbitration agreement. ... It is entirely separate and a distinct cause of action from the Employment Agreement. This conclusion reflects the court’s application of an inappropriate test for determining the arbitrability of the claim. It should be noted that the parties did not refer the court to any applicable case law. Nonetheless, restricting arbitrable issues to those arising out of the employment contract is contrary to federal law which governs this case. During the hearing on the second motion to compel arbitration, the parties did cite and discuss the applicability of the relevant cases. In denying that motion, the trial court stated: This Court is satisfied that there is a serious question as to whether the allegedly defamatory statement as to Plaintiffs alcoholism relates to his employment to come under Fleck. Also, the Motion to Compel was made earlier. Because there’s been so much activity and intensity in this case since then, it would be unfair to the Plaintiff to send it to arbitration at this late date. Therefore the Motion to Compel is denied. It appears the court had some doubt about the arbitrability of the defamation claim, and resolved that doubt against arbitration by balancing judicial economy with possible prejudice to the plaintiff. The federal arbitration act does not authorize such a balancing test. Any doubt about the arbitrability of an issue is to be resolved in favor of arbitration. Moses H Cone Mem Hosp v Mercury Construction Corp, 460 US 1; 103 S Ct 927; 74 L Ed 2d 765 (1983). Moreover, judicial economy is not an overriding concern. The federal act requires courts to compel arbitration even where the result would be inefficient or involve duplicative proceedings, because the purpose of the act is to ensure judicial enforcement of privately made agreements to arbitrate, not to promote the expeditious resolution of claims. Dean Witter Reynolds Inc v Byrd, 470 US 213; 105 S Ct 1238; 84 L Ed 2d 158 (1985). Having concluded that the trial court applied the wrong tests in denying defendants’ motions to compel arbitration, the question remains whether plaintiffs defamation claim is arbitrable under federal law, that is, whether each alleged statement involves significant aspects of the employment relationship, involving evaluation of plaintiffs performance as a broker or deriving from his occupational duties as a registered representative. The alleged defamatory statements at issue include comments made by defendants Greening and Purcell that plaintiff was discharged because he had changed positions within the company and breached an agreement to keep the terms of that change confidential, because of his inability to manage women and the personnel turnover the problem caused, and finally because plaintiff had a drinking problem. Although the communications made by the individual defendants may not concern directly plaintiff’s handling of accounts as broker, they do relate to his performance of the employment agreement, his dealings with customers, and his performance as a manager. We therefore find them to be significantly related to the employment relationship and, thus, arbitrable. Finally, plaintiff argues even if the defamation claims were arbitrable, defendants waived the right to compel arbitration by participating in the litigation in circuit court. The trial court’s ruling does not expressly find a waiver. Rather, as noted above, it applied a fairness test to the question of arbitrability. Waiver of a contractual right to arbitration is not favored. Fisher v A G Becker Paribas Inc, 791 F2d 691 (CA 9, 1986). Any examination of whether the right to compel arbitration has been waived must be conducted in light of the strong federal policy favoring enforcement of arbitration agreements. Moses, supra. A party arguing there has been a waiver of the right to arbitration bears a heavy burden of proof. The party must demonstrate knowledge of an existing right to compel arbitration, acts inconsistent with the arbitration right, and prejudice to the party opposing arbitration resulting from the inconsistent acts. Fisher, p 694. Even accepting the trial court’s finding that plaintiff has been prejudiced, there has been no showing that defendants acted inconsistently with their right to arbitration. Defendants’ motion to compel arbitration in this case was their first responsive pleading to plaintiffs complaint. They raised the arbitration agreement as an affirmative defense. They engaged in discovery and brought and responded to motions in the circuit court only after the court erroneously denied their motion to compel arbitration. Their counterclaim for a preliminary injunction, although not referring to their claim that the disputes between the parties were subject to arbitration, asked only for injunctive relief to preserve the status quo, not for money damages for any claimed breach of plaintiffs covenant not to compete. There is no showing on these facts that defendants have at any time acted inconsistently with their claim of right to arbitration. Rush v Oppenheimer & Co, 779 F2d 885 (CA 2, 1985). We believe any prejudice suffered by plaintiff in terms of time and expense, although unfortunate, was self-inflicted. Fisher, p 698. Plaintiff chose the forum in violation of his agreement to arbitrate disputes. The strong federal policy in favor of enforcing arbitration agreements in transactions affecting commerce requires the conclusion that defendants did not waive their right to arbitration. We therefore conclude the trial court properly found plaintiffs three claims of breach of an employment contract to be arbitrable, but erred in declining to find plaintiffs defamation claim not to be. Affirmed, in part, reversed in part, and remanded for entry of an order compelling arbitration of plaintiffs defamation claim and staying further proceedings.

Mixed Result
Pattison v. Labor Relations Commission
8980Jan 24, 1991Massachusetts

Nina Pattison vs. Labor Relations Commission (and a companion case). Nos. 89-P-383 & 89-P-384. Suffolk. September 13, 1990. January 24, 1991. Present: Dreben, Kaplan, & Porada, JJ. Labor Relations Commission. Labor, Fair representation by union, Collective bargaining, Damages. Damages, Fair representation by union. Contract, Collective bargaining contract. In a proceeding before the Labor Relations Commission on an employee’s charge of prohibited practice under G. L. c. 150E, § 10 (¿0(1), against a union alleging breach of its duty of fair representation, the commission was warranted in concluding that the union had failed to give equal representation to all members of the bargaining unit and that the union had acted arbitrarily in handling the employee’s grievance. [15-17] In a proceeding before the Labor Relations Commission in which an employee established that a union, as her collective bargaining representative, had breached its duty of fair representation in that it failed arbitrarily to press a grievance on her behalf, the commission, in determining whether the employee was entitled to material relief, properly adopted the policy that the employee must first establish that the grievance was not clearly frivolous and that the burden then shifts to the union to demonstrate that the employee could not have succeeded if arbitration had taken place; in the circumstances, where the record showed confusion as to this rule on burdens of proof, the union, on remand, was to be afforded an opportunity to offer additional evidence. [17-21] Where an order of the Labor Relations Commission awarded back pay damages to an employee against a union which, as her collective bargaining representative, had failed arbitrarily to press a grievance against her employer for wrongful termination, the union’s responsibility was to be mitigated by any amount recovered from the employer, either by arbitration or by a court action in the employee’s name. [21-23] In a proceeding before the Labor Relations Commission, an employee, acting separately from her exclusive collective bargaining representative, did not have standing to charge her employer with a prohibited practice under G. L. c. 150E, § 10 (a)(5) & (6), for alleged failure to carry out a collective bargaining obligation. [23-24] Appeals from a decision of the Labor Relations Commission. Alan J. McDonald for Nina Pattison. Jean Strauten Driscoll for Labor Relations Commission. David F. Grunebaum for the employer. Robert M. Schwartz for Quincy City Employees Union, H.L.P.E. Quincy City Employees Union, H.L.P.E. vs. Labor Relations Commission. Kaplan, J. On March 18, 1985, Nina Pattison, a public employee serving at the Quincy City Hospital as director of volunteer services, received a letter from Margaret Corbett, on behalf of the employer Hospital, “terminating” her. She wished to “grieve” her dismissal but, she asserts, her relevant collective bargaining agent, Quincy City Employees Union, H.L.P.E, failed arbitrarily to press the grievance on her behalf and ultimately to request arbitration, thus encompassing violations of its duty of fair representation (DFR). In undertaking litigation, Pattison would have done well to seek a forum that would allow her to join both the union and the employer, for those parties putatively committed related wrongs. The decisional law in 1985, before the ruling in Leahy v. Local 1526, Am. Fedn. of State, County, & Mun. Employees, 399 Mass. 341 (1987), left unsettled (and largely unthought of) the question whether or to what extent the Labor Relations Commission (Commission) had “primary jurisdiction” in DFR cases. So Pattison’s attorney might have considered choosing between starting an action in Superior Court and bringing charges before the Commission. There would be little difficulty in joining the two parties in the court action. Attempting to charge both in Commission proceedings would encounter difficulties, as will appear. Pattison’s counsel chose the Commission route. On August 29, 1985, Pattison filed a charge of prohibited practice under G. L. c. 150E, § 10(b)(1), against the union by reason of its breaches of DFR (Charge MUPL-2883). Recognizing, apparently, that an employer’s breach of a “just cause” provision of a labor contract is not itself cognizable as a prohibited practice under the statute, Pattison, with some ingenuity, attempted instead to charge the employer with a prohibited practice under G. L. c. 150E, § 10(a)(5) and (6) for failing to carry out an alleged collective bargaining obligation. This was framed as an obligation to refrain from changing unilaterally the terms and conditions of employment, including changes in the progressive disciplinary procedures for employees and in the just cause standard for dismissal (Charge MUP-6037). When the Commission proceedings were already under way, as described below, Pattison, for better assurance, on December 31, 1985, did commence an action in Superior Court against the union and the employer; the action remains at issue but has not proceeded further. After investigation, the Commission issued complaints corresponding to the charges (although, as to the collective bargaining complaint, the Commission was doubtful of its own jurisdiction). Initially the Commission ruled that the complaints should be “bifurcated,” but it soon changed its mind and ordered them to be consolidated and tried together. Trial before two Commissioners* occurred in ten installments over a period of eight months, from August, 1986, to April, 1987. On January 24, 1989, the Commission filed its “Decision” upholding the DFR complaint but dismissing the collective bargaining complaint. The union appeals to this court from the former disposition (appeal No. 89-P-384), Pattison from the latter (No. 89-P-383). See G. L. c. 150E, § 11, par. 4. To sum up our views. In No. 89-P-384: (1) Pattison had the full burden to establish that the union discriminated against her or acted with egregious disregard of her rights as a grievant. The Commission’s findings for Pattison on these issues are well supported by substantial evidence, G. L. c. 30A, § 14(7)(e). (2) As to Pattison’s right to a material remedy, burdens of proof are adjusted in the light of the union’s delinquency, which aborted the arbitral process: Pattison had to show that her claim of dismissal without just cause was not clearly frivolous; once she did so, the burden shifted to the union to show that the grievance was clearly nonmeritorious. The Commission’s findings that Pattison made her prima facie showing, and the union failed in its opposition, are also well supported by substantial evidence. (3) Pattison, having thus succeeded on the facts, was entitled to a “provisional make whole remedy” against the union (the only defending party properly before the Commission), that is, recovery for wrongful dismissal, which, however, is subject to offset by the union. Among other things, this may take the form of a division of the liability between the union and the employer. To revert to the point that the union failed in its burden of overcoming a prima facie case, the union has claimed that the policy of the Commission in imposing that burden was not made clear in the course of the hearings, with the consequence that the union was unsure about the weight of the evidence it had to present. Upon a reading of the whole record, we think the complaint is justified, and will therefore remand the case to the Commission if the union expresses an election to offer additional proof. No. 89-P-383: We agree with the Commission’s dismissal of the complaint. Pattison, as employee, could not complain of the alleged bargaining violation on the part of the employer. No. 89-P-384 — Duty of Fair Representation (1) Union’s violations. From the inordinately extended record, the Commission has abstracted the following statement, which we consider to be a fair summary of the basic facts. “Nina Pattison was hired on or about August 14, 1984, as the Director of Volunteer Services at Quincy City Hospital. Her duties were to direct and administer the Hospital’s program of volunteer services, including recruiting, orienting, assigning, supervising and evaluating volunteer workers. Her direct supervisor, Margaret Corbett, became dissatisfied with Pattison’s progress in recruiting new volunteers, organizing a program to orient volunteers to the Hospital, and decentralizing the volunteer program. In weekly meetings with Pattison, Corbett discussed these problems and finally met with Pattison and Corbett’s supervisor, Doris Sincevich, the Director of Nursing, in January of 1985 about Pattison’s progress. After Corbett failed to see sufficient improvement in Pattison’s performance, Corbett recommended to Sincevich in March, 1985, that Pattison be terminated. Early in March Corbett met with Pattison, told her she was considering Pattison’s termination, and asked her to think about resigning. The following day Corbett told Pattison that she was going to recommend to the Director of Human Resources, James Tzamos, that Pattison be terminated unless she agreed to resign. Corbett did so and her recommendation that Pattison be terminated for poor performance was accepted. During the meeting between Tzamos and Corbett, Tzamos noted that Pattisori’s probationary period had already expired and stated that they would have to discuss the termination with the Union. “The Hospital’s disciplinary guidelines provide a progressive system for discipline based on ‘poor performance,’ beginning with a verbal warning, then a written warning, then a suspension and finally termination. Pattison had not received either a formal written warning or a suspension before she was terminated. “Corbett and Tzamos met with a Union representative and told her that Pattison was to be terminated and that she had been employed for several days beyond the six-month probationary period. The Union representative told Corbett and Tzamos that there could be a problem, and also informed the Union steward of the discussion. “On March 8, 1985, Corbett and Tzamos met with Pattison and notified her that she was being terminated. Pattison subsequently received a letter of termination from Corbett on March 18. On March 11, Pattison had telephoned the Union’s office and spoke with John Keefe, the Executive Director. After hearing that she had not received any written warnings, Keefe told her that he thought he could get her reinstated if she wanted her job back. Pattison told Keefe she was uncertain about that, but Keefe said he would check into her case and get back to her. When Keefe called her back, he told Pattison he could find no record of her being a dues-paying member, and asked her to call the Hospital payroll department and-see what she could find out. Pattison found out that no union dues had been deducted from her paychecks, and she tried to call Keefe back on March 13, 14 and 15, and left messages for him. Keefe never returned her calls and Pattison never spoke with Keefe again about her termination. “After Pattison received the March 18 termination letter from the Hospital, she contacted the Union steward, Dorothy Wassmouth. Pattison told Wassmouth that she wanted to file a grievance about her termination. Wassmouth said, ‘You can file a grievance if we say you can file a grievance, and we’ll get back to you.’ Pattison told Wassmouth that she didn’t know why she was terminated, and Wassmouth said she would check into it. After telephoning Wassmouth several times without reaching her, Patti-son found a recorded message on her answering machine which stated, ‘You have no grievance. As far as we are concerned, you have no grievance. Everything is taken care of, and please don’t call this office again.’ This was Pattison’s last contact with any representative of her Union. “Pattison then contacted an attorney and on his advice delivered a letter to Corbett on March 25 stating that she was grieving the decision to terminate her employment. Pattison sent a copy of the letter to Keefe, with a cover letter requesting the Union’s assistance in processing the grievance and asking for a copy of the current collective bargaining agreement. On April 2, Pattison, having had no reply from the Employer, wrote to Sincevich that she was now grieving the decision at step two of the grievance procedure. Pattison also sent a copy of this letter to Keefe. After receiving no response at step two, Pattison’s attorney sent a similar letter to the Mayor on April 9, with a copy to Keefe, seeking a step three review. A meeting was eventually held between Pattison, her attorney, Tzamos and the Hospital’s attorney, but the grievance remained unresolved. On June 19, Pattison’s attorney wrote to Keefe requesting [that] he file a demand for arbitration (under the collective bargaining agreement, only the Union could demand arbitration). The Union did not respond and Patti-son’s attorney wrote a second letter on June 27. The Union received both letters but did not reply. The Union did not assist Pattison in processing her grievance and did not file a demand for arbitration.” It will be seen that union help to Pattison in forwarding her grievance stopped with the revelation that she was (unwittingly, as it turned out) not on the union roll. The Commission drew an inference of cause and effect and held that Pattison had carried her burden of demonstrating that the union was in breach of its DFR, for it is a discriminatory and illegal act for a union to fail to give equal representation in grievance and other matters to all members of the bargaining unit regardless of their union allegiance. See G. L. c. 150E, § 5, inserted by St. 1973, c. 1078, § 2: “The exclusive representative . . . shall be responsible for representing the interests of all such employees [those in the unit] without discrimination and without regard to employee organization membership.” See also Leahy, 399 Mass, at 348; Carbone v. School Comm. of Medford, 12 Mass. App. Ct. 948 (1981). The Commission likewise upheld Pattison in her submission that, putting the question of discriminatory motive to one side, the union was arbitrary — perfunctory or worse — in handling her grievance, and this likewise encompassed a violation of DFR. See Graham v. Quincy Food Serv. Employees Assn. & Hosp., Library & Pub. Employees Union, 407 Mass. 601, 606 (1990); Trinque v. Mount Washington Community College Faculty Assn., 14 Mass. App. Ct. 191, 199 (1982). The Commission acknowledged that the level of proficiency required of union management is not an exalted one; it tolerates honest mistake or simple negligence. See Graham at 606; Trinque at 199; Baker v. Local 2977, State Council 93, Am. Fedn. of State, County & Mun. Employees, 25 Mass. App. Ct. 439, 441 (1988). See also Vaca v. Sipes, 386 U.S. 171, 190 (1967); Amalgamated Assn. of St., Elec. Ry. & Motor Coach Employees of America v. Lockridge, 403 U.S. 274, 301 (1971); Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 563-567 (1976); Early v. Eastern Transfer, 699 F.2d 552, 555 (1st Cir. 1983). Here the union’s fault was egregious. The Commission’s decision on both scores seems to us unimpeachable even if we were to attach no significance to the respect that is due to this agency with its accumulated expertness in the field. See Quincy City Hosp. v. Labor Relations Commn., 400 Mass. 745, 749 (1987); G. L. c. 30A, § 14. See also note 5, supra. The union, with some support from the employer, has offered several possible justifications of its behavior. It sought to establish that Pattison was not in fact a member of the bargaining unit. However, her immediate predecessor in the job, although having a different title, did roughly the same work, and was admittedly a member. Then it was suggested that Pattison held a “managerial” post. But the predecessor’s position was not so characterized, and examination of Pattison’s relation to her superiors also tended to belie the characterization. These contentions have evidently been abandoned on the present appeal. The union tries to demonstrate that Pattison, in pursuing her grievance from step to step without union help, did not follow the timetable prescribed in the collective bargaining agreement, and thus forfeited any claim. Pattison says that in point of fact she did comply with the time requirements. There is evidence, too, that in practice the parties permitted considerable leeway in meeting the formal time limits of the agreement. So also there is ground for belief that the issue of timeliness is not a real one, but is interposed as an afterthought. After her dismissal, Pattison said she was not sure she wanted reinstatement, and she said repeatedly that she wanted to know why she had been fired, wherein her performance had been deficient. The union claims it acted reasonably in taking Pattison at her word and assuming that she was interested in an explanation, but not in a positive remedy. On the other hand, Pattison did proceed to “grieve,” and Wassmouth evinced an understanding that Pattison wanted more than an explanation. The attorney’s final demand upon the union to request arbitration is of course explicit to the same effect. The Commission did not err in rejecting the union’s attempted justifications. (2) Pattison’s right to a remedy. Notwithstanding the union’s breach of DFR, in logic Pattison should not be entitled to material relief if her basic grievance was in fact so weak, her performance on the job so poor, that her chances before a reasonable arbitrator were minimal or hopeless. Accordingly, in light of all the equities, the Commission has here adopted as a policy the proposition that an employee in Pattison’s position must establish that his or her grievance was not clearly frivolous; the burden then shifts to the union to demonstrate that the grievance was clearly without merit, that the employee could not have succeeded if arbitration had taken place. On the present record, the Commission could well decide that Pattison presented a prima facie case of wrongful dismissal. Whether her handling of the difficult and rather amorphous volunteer problem in the short period of her tenure was reasonably adequate, is perhaps open to debate. But it is certain that she was not given the benefit of the hospital’s progressive discipline policy nor furnished with the culminating pretermination written warning. The Commission could also hold that the union on its part did not overcome Pattison’s prima facie case and sustain its burden of countervailing proof. As noted above, the union does seem to have reason for the contention that the ground rule on burdens of proof was left in some confusion during the hearings. In fairness, if the union indicates a wish to offer additional proof, the case will be remanded to the Commission to receive and evaluate it. The Commission’s very policy or ground rule is challenged but appears quite tenable as a determination by the responsible agency with specialized knowledge and experience in the field. The Commission could hold that it would be little short of incongruous to cast on the employee the whole burden of convincing the Commission that he or she would more probably than not have succeeded before a rational arbitrator in the normal course. The opportunity to lay the matter before an arbitrator in the ordinary way has been lost precisely because the union has failed in its duty to represent the employee. Therefore, the union should bear the ultimate risk of uncertainty as to how an arbitrator would have decided the grievance. The Commission’s policy regarding the relative burdens of employee and union accords with that of the National Labor Relations Board (Board) as enunciated in United Rubber, Cork, Linoleum & Plastic Wkrs. of Am., Local 1250 (Mack-Wayne Closures), 290 NLRB No. 90 (July 29, 1988) (Mack-Wayne II). The Board said, discussing the union’s “shifted burde

Mixed Result
Mourad v. Automobile Club Insurance
8979Jan 8, 1991Michigan

MOURAD v AUTOMOBILE CLUB INSURANCE ASSOCIATION Docket No. 109985. Submitted April 11, 1990, at Detroit. Decided January 8, 1991, at 9:35 a.m. Roger Mourad, after he was demoted from head of the legal department to executive attorney, brought an action in the Wayne Circuit Court against the Automobile Club Insurance Association, his former employer, and three of its employees, alleging breach of an employment contract providing for termination for just cause only, retaliatory demotion and constructive discharge, intentional infliction of emotional distress, and conspiracy. The court, Henry J. Szymanski, J., entered judgment consistent with a jury verdict awarding the plaintiff compensatory damages for breach of contract and retaliatory demotion and exemplary damages for retaliatory demotion, but overturned an award of exemplary damages for intentional infliction of emotional distress. The defendants appealed. The plaintiff cross appealed. The Court of Appeals held: The plaintiff can maintain a cause of action against Auto Club for breach of a contract providing termination for just cause only as a result of retaliatory demotion and constructive discharge. However, because the cause of action for retaliatory demotion and constructive discharge merges with the breach of contract claim, that award must be set aside. Damages for intentional infliction of emotional distress are not recoverable in an action for breach of an employment contract. 1. The jury did not err in finding that there was a contract providing termination of employment for just cause only and that the defendants breached the contract when they constructively discharged the plaintiff by demoting him for his failure to take action which he claimed would have violated the Code _of Professional Responsibility. Accordingly, the trial court did not err in denying the defendants’ motion for a directed verdict regarding the claim of constructive discharge. References Am Jur 2d, Damages § 118; Master and Servant §§ 44, 62, 63. See the Index to Annotations under Attorney or Assistance of Attorney; Discharge from Employment or Office; Emotional Injury. 2. The plaintiffs breach of contract claim is not precluded by the general rule that an attorney’s client has a right to discharge an attorney at any time, with or without cause. The plaintiffs relationship with the defendants was more than merely that of attorney and client. 3. The plaintiff cannot properly recover damages for breach of contract and retaliatory demotion and discharge because each cause of action is an alternative type of wrongful discharge. Thus, the award of damages for retaliatory demotion must be vacated. 4. The trial court erred in instructing the jury with regard to the availability and adequacy of defendants’ internal appeal procedures upon the plaintiffs demotion inasmuch as the defendants did not assert that the plaintiff was precluded from maintaining his action because an internal appeal procedure was available. The error, however, does not require reversal because the verdict was consistent with substantial justice. 5. Damages for intentional infliction of emotional distress are not recoverable in an action for breach of an employment contract. The trial court erred in submitting the claim of intentional infliction of emotional distress to the jury, but properly refused to grant judgment with regard to the jury’s award of exemplary damages for intentional infliction of emotional distress. 6. The trial judge, an Auto Club policyholder, did not abuse his discretion in failing to disqualify himself as an interested party. The defendants failed to show actual bias sufficient for disqualification. The trial judge’s comments and questions at trial were not improper or prejudicial, nor did they deny the defendants a fair and impartial trial. Affirmed in part, reversed in part, and remanded. 1. Master and Servant — Attorney and Client — Wrongful Discharge. An action for wrongful discharge by an in-house attorney against an insurer-employer, claiming breach of a just-cause employment contract was not barred by the general rule that an attorney’s client has a right to discharge an attorney at any time, with or without cause, where the attorney, aside from serving as counsel for the insurer, also served as counsel for the insurer’s policyholders and as administrator for the insurer. 2. Master and Servant — Termination of Employment — Wrongful Discharge. A jury, having found a breach of a just-cause contract of employment, cannot rely on the same factual basis to award additional damages for a claim of retaliatory demotion and retaliatory constructive discharge. 3. Damages — Emotional Distress — Breach of Employment Contracts. Damages for infliction of emotional distress are not recoverable in an action for breach of an employment contract. Weinstein, Gordon & Hoffman, P.C. (by William J. Weinstein and Joel L. Hoffman), for the plaintiff. Dykema Gossett (by Donald S. Young, Kathleen McCree Lewis, and Suzanne Sahakian), for the defendants. Before: Holbrook, Jr., P.J. and McDonald and Jansen, JJ. Jansen, J. Defendants appeal as of right from a March 3, 1988, Wayne Circuit Court jury verdict in the amount of $1,773,000 for breach of an employment contract, demotion without cause, constructive discharge, retaliatory demotion, intentional infliction of emotional distress, and conspiracy. Plaintiff cross appeals the trial court’s refusal to enter an additional $500,000 in exemplary damages which the jury had awarded on a special verdict form for intentional infliction of emotional distress. We hold that plaintiff, an attorney, can maintain a cause of action against defendant, Automobile Club Insurance Association (Auto Club), his former client and employer, for breach of a just-cause contract. However, we reverse the jury verdict regarding the claims of retaliatory demotion, intentional infliction of emotional distress, and conspiracy. We therefore affirm in part and reverse in part. In 1980, plaintiff was named legal area manager and in that capacity headed Auto Club’s in-house legal department from August 1980 until March 1983 when he was demoted to an executive attorney position. Auto Club’s legal department represents the insurance association in first-party cases and represents policyholders in third-party cases. The legal department attorneys supervise outside counsel and provide legal counsel and advice to Auto Club’s claims staff regarding nonlitigation matters. As legal area manager, plaintiff served as the attorney who advised management regarding the implementation of Auto Club’s policies within the department. Specifically, plaintiff formulated budget requests and administered the legal department within the budget approved by Auto Club. Plaintiff also supervised the attorney staff in its representation of insureds in pending litigation. Specifically, plaintiff gave settlement authority in certain cases, dealt with personnel problems and questions from attorneys and staff, evaluated executive attorneys, and reviewed senior attorneys’ evaluations of associate attorneys. Plaintiff described his function as a "managing lawyer.” As legal area manager he did not directly handle individual third-party cases. It appears that plaintiff was an excellent lawyer. However, Thomas Bowman, Auto Club’s claims director and plaintiff’s direct supervisor, concluded that plaintiff was unable to implement Auto Club’s policies and did not have the "administrative talents” necessary to effectively implement cost-containment measures in the legal department. In September 1982, Bowman assigned defendant Leonard Bach, who is not a lawyer, but who had twenty years of claims experience, to oversee the legal department. On March 16, 1983, plaintiff was removed as legal area manager and demoted to executive attorney. Plaintiff lost his use of a company car and approximately $700 in annual salary. Following his demotion, plaintiff was an executive attorney who handled first-party catastrophic claims. On March 16, 1984, plaintiff resigned his employment with Auto Club and opened a sole practice. On July 11, 1984, plaintiff filed a complaint alleging breach of a just-cause contract, retaliatory demotion and constructive discharge, intentional infliction of emotional distress, and conspiracy to commit the tort of retaliatory demotion or intentional infliction of emotional distress. Plaintiff claimed that his demotion was the result of his refusal to comply with alleged unethical and illegal orders from the individual defendants who were not attorneys. Plaintiff further claimed that had he complied with such orders and instructions he would have violated the Code of Professional Responsibility and Canons. On March 3, 1988, the jury returned its verdict. As compensatory damages, the jury awarded $1,250,000 as past, present, and future loss of wages and employment benefits for the breach of contract claim and $23,000 as past, present, and future loss of wages and employment benefits for the retaliatory demotion claim. For retaliatory demotion, the jury added $500,000 as compensatory damages for mental anguish. The jury also awarded $500,000 as exemplary damages for intentional infliction of emotional distress. Following an April 15, 1988, hearing, the court entered a judgment on the jury verdict, less the exemplary damages for intentional infliction of emotional distress, which the court found inconsistent, duplicative and punitive. Defendants argue that plaintiff cannot sustain a cause of action for wrongful termination, because plaintiff was defendants’ attorney. Specifically, defendants allege that a just-cause contract as established in Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), reh den 409 Mich 1101 (1980), cannot exist under these circumstances. We disagree. The issue before us is whether plaintiff can maintain an action for wrongful termination of a just-cause employment contract. In Toussaint, supra, our Supreme Court held that an employer’s statements of company policy and procedure that an employee will be terminated only for cause can give rise to an enforceable contract right. The existence of a just-cause contract and whether defendants’ actions constituted a breach of that contract is a question for the jury to determine. Stoken v J E T Electronics & Technology, Inc, 174 Mich App 457, 464; 436 NW2d 389 (1988); Struble v Lacks Industries, Inc, 157 Mich App 169, 175; 403 NW2d 71 (1986). Initially, we note that the jury did not err in finding that there was a just-cause contract and that defendants, by demoting plaintiff for his failure to comply with policy decisions which plaintiff claimed would have violated the code of professional conduct, breached that contract. In a special jury form, the jury found that defendants’ policy manual and pamphlets had in fact created a contract to terminate for just cause. The jury also found that defendants did not have just cause to demote plaintiff and that defendants constructively discharged plaintiff by making the conditions of plaintiff’s work so intolerable that plaintiff felt compelled to leave. We are unpersuaded by defendants’ argument that the trial court erred in failing to direct a verdict for defendants on the constructive discharge claim. A constructive discharge occurs when an employer deliberately makes an employee’s working conditions so intolerable that the employee is forced into an involuntary resignation or, stated differently, when working conditions become so difficult or unpleasant that a reasonable person in the employee’s shoes would feel compelled to resign. Fischhaber v General Motors Corp, 174 Mich App 450, 454-455; 436 NW2d 386 (1988). In reviewing a trial court’s ruling on a motion for a directed verdict or judgment notwithstanding the verdict, the testimony and all legitimate inferences that may be drawn from that testimony are viewed in the light most favorable to the plaintiff. Matras v Amoco Oil Co, 424 Mich 675, 681; 385 NW2d 586 (1986). If reasonable jurors could honestly reach different conclusions, the motion should be denied, and the case should be decided by the jury, because no court under such circumstances has authority to substitute its judgment for that of the jury. Id.; Feaheny v Caldwell, 175 Mich App 291, 299-300; 437 NW2d 358 (1989). We hold that the trial court did not err in refusing to grant defendants’ motion for a directed verdict. Evidence presented at trial indicated that plaintiff was demoted from the highest position in the legal staff to a lesser position with the resultant loss of authority and various benefits. Evidence indicated that plaintiff was essentially isolated from the operation of the law department. Further, after plaintiff’s demotion, plaintiff alleged that defendants continued to make unethical requests and demands concerning plaintiff’s representation of insureds. Under these facts, we find that a reasonable juror could find that plaintiff was constructively discharged. Defendants claim that plaintiff’s cause of action should be precluded by the general rule that a client has a right to discharge his attorney at any time, with or without cause. See comments to MRPC 1.16, formerly DR 2-110; Brown v Brown, How NP 94, 95 (Wayne CC, 1876). We disagree. In support of their position, defendants cite Herbster v North American Co, 150 Ill App 3d 21; 103 Ill Dec 322; 501 NE2d 343 (1986), and Willy v Coastal Corp, 647 F Supp 116 (SD Tex, 1986), rev’d on other grounds 855 F2d 1160 (CA 5, 1988). In Herbster, the plaintiff brought suit for retaliatory discharge against his employer, North American Company, stemming from the plaintiff’s refusal to destroy or remove inculpatory documents requested in lawsuits pending in federal court. The plaintiff was North American’s chief legal officer and vice-president in charge of the legal department under an employment-at-will contract. In Illinois the tort of retaliatory discharge is an exception to the general rule that an employee at will has no recourse for discharge. The tort requires that the employer discharge the employee in retaliation for the employee’s activities and that the discharge be in contravention of clearly mandated public policy. The Illinois court granted summary judgment for North American on the basis of the attorney-client relationship. The Illinois Court of Appeals affirmed, refusing to extend the tort of retaliatory discharge to cases involving general in-house counsel. The Illinois Court of Appeals noted that the right to terminate is a necessary aspect of the attorney-client relationship and a preventive measure against the evils created by any friction or distress between an attorney and his client. Likewise, in Willy, the federal district court held that an in-house attorney is required to withdraw from employment when a client elects to terminate the attorney-client relationship. In that case, the court granted the defendant’s motion to dismiss a cause of action for wrongful termination from the plaintiffs employment as in-house counsel. The plaintiff alleged that he was fired because he required the defendant to comply with environmental laws. The Willy court held that the public policy exception, which creates a cause of action for retaliatory discharge in the context of an employment-at-will contract, does not apply to the termination of in-house attorneys. The Willy court noted that the ethical canons and the disciplinary rules set forth the standards for attorneys to follow and that they require an attorney presented with ethical conflicts to withdraw from representation. Thus, the Willy Court declined to extend the retaliatory discharge claim to include the wrongful termination of in-house attorneys. However, the appeals court of New Jersey, in Parker v M & T Chemicals, Inc, 236 NJ Super 451; 566 A2d 215 (1989), held that the New Jersey Whistleblower’s Act compels an employer to pay damages to an employee-attorney who is wrongfully discharged or mistreated for any reason which is violative of law, fraudulent, criminal, or incompatible with a clear mandate of New Jersey public policy concerning public health, safety, or welfare. Id. at 220. Thus, Parker held that the attorney-client relationship was not a bar to recovery on the basis of a retaliatory discharge claim. We distinguish the Willy, Herbster, and Parker opinions. These cases dealt with the question whether the state will recognize a public policy exception to the typical employment-at-will contract. In the present case, the jury found a just-cause contract and a breach of that contract. The determination of the existence of a public policy exception to an employment-at-will contract, as discussed in Willy, Herbster, and Parker, is a different inquiry from the establishment of a breach of a just-cause contract. The present case involves the creation of contractual rights by the parties, not the imposition of restrictions on employment termination on the basis of public policy grounds. Further, we decline to adopt a complete bar to suits brought by an attorney for wrongful termination and breach of a just-cause contract on the basis of the attorney-client relationship. The general rule that a client has the right to discharge his attorney at any time, with or without cause, does not affect the present action for breach of contractual rights. Although at the time of plaintiffs demotion and constructive discharge DR 2-110 required that an attorney withdraw from employment if he knows or if it is obvious that his continued employment will result in a violation of a disciplinary rule, the present case does not simply involve an attorney-client relationship between plaintiff and Auto Club. In many ways, plaintiff, in his relationship as supervisor of the legal staff and subsequently as supervisor over lawsuits involving catastrophic injury, was an attorney for the insureds. As such, he had a duty of loyalty and zealous representation to the insured client alone. American Employers’ Ins Co v Medical Protective Co, 165 Mich App 657, 660; 419 NW2d 447 (1988). In this role, plaintiffs "sole loyalty and duty is owed to the client alone.” Atlanta Int’l Ins Co v Bell, 181 Mich App 272, 274; 448 NW2d 804 (1989). The Bell Court summarized: [T]he fact remains that an insurance defense attorney represents the insured and not the insurance company. The only attorney-client relationship which exists is between the attorney and the insured client. Indeed, whenever the interests of the insured and the insurance company differ, the attorney’s ethical obligation is to pursue the interests of the insured client the attorney is representing and not the interests of the insurance company who pays the bill. . . . Indeed, the insurance company’s relationship is, in reality, with its insured; that is, the insurance company is obligated to pay the attorney fee incurred by its insured in defending litigation covered by an applicable insurance policy. The fact that an insurance company may directly pay the attorney fee rather than merely reimbursing its insured does not affect the nature of the attorney-client relationship nor does it change the fact that the attorney represents the insured client and only owes a duty to that insured client. [Bell, supra at 274-275, citation omitted.] However, it should also be noted that in some respects plaintiffs relationship with Auto Club was as counsel for Auto Club. Auto Club’s legal department represented Auto Club in first-party cases, i.e., where a policyholder sues Auto Club, seeking benefits under an insurance contract. Plaintiff also acted as in-house counsel who advised management on the operation of the legal department in supervising attorneys who represented various policyholders in separate actions. Finally, we note that plaintiff was also a supervisor acting in an administrative role. In this sense, plaintiff did not

Mixed Result$1,250,000 awarded
EEOC v. Independent Stave Co., Inc.
E.D. Mo.Jan 3, 1991Missouri
Plaintiff Win
Shaffner v. Westinghouse Electric Corp.
14983Dec 18, 1990North Carolina

WILLIAM HOWARD SHAFFNER, JR., Plaintiff v. WESTINGHOUSE ELECTRIC CORPORATION, Defendant No. 9021SC138 (Filed 18 December 1990) Master and Servant § 10.2 (NCI3d)— workers’ compensation— termination for misrepresenting extent of disability — no violation of statute The evidence supported the jury’s verdict finding that plaintiff was not terminated from his employment in violation of N.C.G.S. § 97-6.1(a) because he instituted a claim under the Workers’ Compensation Act where it showed that the employer did not question the fact of plaintiff’s disability but terminated plaintiff for misrepresentations about the extent of his disability. Am Jur 2d, Workmen’s Compensation § 55. Recovery for discharge from employment in retaliation for filing workers’ compensation claim. 32 ALR4th 1221. APPEAL by plaintiff from judgment entered 21 July 1989 in FORSYTH County Superior Court by Judge W. Steven Allen. Heard in the Court of Appeals 30 August 1990. Herman L. Stephens for plaintiff-appellant. Womble, Carlyle, Sandridge & Rice, by Charles F. Vance, Jr., C. Daniel Barrett and Clayton M. Custer, for defendant-appellee. DUNCAN, Judge. William Shaffner, Jr. (“plaintiff”) was employed by Westinghouse Electric Corporation (“defendant”) for over fourteen years. At the time of his final injury he was working as a senior electrician. During the course of his employment plaintiff sustained a number of injuries; he received workers’ compensation benefits for all those injuries for which claims were made. On 15 April 1987, plaintiff’s supervisor directed him to return an electric motor to a storage crib. The particular building in which the crib was housed did not have a storage attendant to receive merchandise, so plaintiff had to lift the motor himself — something he did not normally do. Immediately after lifting the motor, the muscles in his lower back began to tighten up, and his condition worsened throughout the day. The next morning plaintiff experienced low back pain in addition to the tightened muscles. His condition worsened after he returned to work, and by Monday of the following week he went to see Dr. Middleton, the plant doctor. Dr. Middleton prescribed medication and recommended a week’s bed rest; plaintiff nevertheless continued to work that week and the following one. When he was seen again, it was recommended that he visit a specialist, and he was eventually seen by Dr. Holthusen, an orthopaedic surgeon who had operated on him previously. Despite recurring pain, plaintiff continued to work until 26 May 1987, when Dr. Holthusen placed him on bed rest. On 30 May 1987, plaintiff took his children to the annual company picnic at the Carowinds Amusement Park, and accompanied his sons on several rides. On 2 June 1987, plaintiff returned to Dr. Holthusen, who continued to state that plaintiff should not work. Dr. Holthusen was not aware that plaintiff had gone to Carowinds and ridden on the rides. On 29 June 1987, plaintiff returned to see Dr. Holthusen, and was released to return to work. When plaintiff reported to work he was placed on suspension without pay pending an investigation into the circumstances surrounding his disability. Plaintiff was subsequently terminated effective 29 June 1987. He was given the following reason: After reviewing all the events, circumstances and facts surrounding your disability condition we have no alternative except to convert your indefinite suspension into discharge for violation of the Plant Rules of Conduct . . . Misrepresentation and/or falsification of records or attendance reports. An internal company appeals board upheld the termination, and plaintiff then brought this action seeking damages for wrongful discharge and reinstatement to his prior position. The jury found that plaintiff had not been terminated because he had instituted a workers’ compensation claim, and held in favor of the defendant. The trial court denied plaintiff’s motion for judgment notwithstanding the verdict, and this appeal followed. I Plaintiff’s primary argument on appeal is that the trial court erred in denying his motions for a directed verdict and for judgment notwithstanding the verdict, because defendant’s explanation of plaintiff’s determination establishes that it discharged him for instituting a workers’ compensation claim. Since the standard for determining the appropriateness of a motion for directed verdict and a motion for judgment notwithstanding the verdict is the same, Dickinson v. Pake, 284 N.C. 576, 584-85, 201 S.E.2d 897, 903 (1974), the following discussion applies to both. In considering a plaintiff’s motion for directed verdict, the defendant’s evidence must be taken as true and must be considered in the light most favorable to defendant, giving defendant the benefit of every reasonable inference to be drawn therefrom. See, e.g., Manganello v. Permastone, Inc., 291 N.C. 666, 231 S.E.2d 678 (1977). Plaintiff argues that defendant’s own evidence establishes a violation of N.C. Gen. Stat. Section 97-6.1 which provides, in pertinent part, as follows: Protection of claimants from discharge or demotion by employers. (a) No employer may discharge or demote any employee because the employee has instituted or caused to be instituted, in good faith, any proceeding under the North Carolina Workers’ Compensation Act, or has testified or is about to testify in any such proceeding. There is no dispute here that plaintiff did, in fact, institute a claim. Plaintiff argues further that by terminating him for misrepresenting his disability, defendant was challenging the existence of his disability —a determination which is within the exclusive province of the Industrial Commission. See N.C. Gen. Stat. Section 97-84. Plaintiff argues that the only avenue open to defendant to contest his disability was through the workers’ compensation process, and that defendant’s action was in effect an impermissible collateral attack on the Commission’s jurisdiction. Although plaintiff makes a compelling argument, we are constrained to disagree for two reasons. First of all, the anti-retaliation language of Section 97-6.1(a) is limited to an employee’s instituting a charge or testifying in a proceeding. Here, neither of those specific actions precipitated defendant’s response. Plaintiff instituted his claim under the Workers’ Compensation Act on 18 April 1987. He was suspended on 29 June 1987 and terminated on 17 July 1987, retroactively effective on 29 June 1987. There is thus no close temporal connection between plaintiff’s instituting a charge and his termination. Plaintiff notes himself that prior to this most recent injury, he had suffered injuries on the job for which he received workers’ compensation benefits. Plaintiff’s broader argument is that defendant’s terminating him for misrepresentation challenged the very issue before the Industrial Commission — the existence of his disability. That argument can be responded to by making a point that even plaintiff recognizes: Defendant was not questioning his representations about the fact of his disability, but rather its extent. Dr. Holthusen also testified that upon learning of plaintiff’s trips and activities, he felt that plaintiff had not been honest with him. Under plaintiff’s interpretations of the statute, an employee could sustain a minor, but disabling injury, and misrepresent the gravity of it without fear of sanction. The jury here found that the defendant did not discharge plaintiff because he instituted a claim under the Workers’ Compensation Act. Giving the defendant, as we must, the benefit of every reasonable inference to be drawn from the facts, we cannot find that the trial court erred in denying plaintiff’s motions for summary judgment and judgment notwithstanding the verdict. II We have examined plaintiff’s other assignments of error and find them to be without merit. Accordingly, the judgment appealed from is Affirmed. Judges COZORT and ORR concur.

Defendant Win
Schippers v. SPX Corp.
8979Dec 17, 1990Michigan

SCHIPPERS v SPX CORPORATION Docket No. 117549. Submitted May 10, 1990, at Grand Rapids. Decided December 17, 1990, at 9:40 a.m. Leave to appeal sought. Joseph Schippers brought an action in the Muskegon Circuit Court against SPX Corporation and Ryder Truck Rental, Inc., claiming wrongful discharge and negligent evaluation. The trial court, Michael E. Kobza, J., granted summary disposition in favor of SPX Corporation, ruling that there were no genuine issues of material fact and that spx was entitled to judgment as a matter of law. The plaintiff appealed. The Court of Appeals held: The grant of summary disposition was improper. Material issues of fact exist regarding whether an employment contract providing termination only for just cause existed between the plaintiff and spx. Reversed and remanded. McCroskey, Feldman, Cochrane & Brock, P.C. (by John P. Halloran), for the plaintiff. Culver, Lague & McNally (by William F. Mc-Nally and Kevin B. Even), for SPX Corporation. Before: Neff, P.J., and Maher and Murphy, JJ. Neff, P.J. Plaintiff appeals as of right from a judgment and order of dismissal entered by the circuit court granting summary disposition pursuant to MCR 2.116(0(10) to defendant SPX Corporation regarding plaintiff’s claims for wrongful discharge and negligent evaluation. We reverse and remand. I The sole issue on appeal is whether a genuine issue of material fact exists regarding whether a just cause employment contract providing termination only for just cause existed between plaintiff and defendant spx. We hold that material issues of fact exist on the bases of defendant’s employee handbook and testimony concerning oral representations made by spx personnel. ii When ruling on a motion for summary disposition made pursuant to MCR 2.116(0(10), courts are liberal in finding that a genuine issue exists, drawing all inferences in favor of the nonmovant and granting the motion only when the court is satisfied that it is impossible for the claim to be supported at trial because of some deficiency that cannot be overcome. Rizzo v Kretschmer, 389 Mich 363, 371; 207 NW2d 316 (1973); Langeland v Bronson Methodist Hosp, 178 Mich App 612, 615-616; 444 NW2d 146 (1989). hi An employer’s statements of company policy to the effect that an employee will be terminated only for just cause can give rise to enforceable contract rights. Toussaint v Blue Cross & Blue Shield of Mich, 408 Mich 579; 292 NW2d 880 (1980), reh den 409 Mich 1101 (1980); Richards v Detroit Free Press, 173 Mich App 256, 258; 433 NW2d 320 (1988), remanded 433 Mich 913 (1989). Here, plaintiff’s deposition testimony was sufficient to create a question of fact with respect to whether the oral representations made to him by spx personnel constituted a promise to discharge only for just cause. See Toussaint, supra, p 613; Hetes v Schefman & Miller Law Office, 152 Mich App 117, 121; 393 NW2d 577 (1986). Plaintiff testified that he had "[v]erbal assurances from three individuals,” on which he relied, for his belief that he could be discharged only for good cause. He named the three individuals, one of whom was his immediate supervisor. The essence of the claimed assurances was that plaintiff was chosen from among seven drivers for his job and that it was his until retirement, "unless something was really wrong.” Plaintiff testified that he inquired about his future with the company because he was moving into a division that had only one truck and he was concerned that the decision might be made to eliminate the truck and his job. It is worthy of note that one of the three employees on whom plaintiff relied indicated at deposition that the custom and practice at spx was to discharge for "good reason” only. This man had heen employed by defendant for more than twenty-five years. While this testimony, of itself, does not create a question of fact, because the employee testified that he never communicated this to plaintiff in those words, it is relevant to plaintiff’s assertions at deposition that he had verbal assurances about the conditions of his employment with SPX. On the basis of the testimony noted above, it was error to grant summary disposition for defendant. iv Mixed signals from employer to employee in employee handbooks can also raise a question of fact about reasonable employee expectations. Toussaint, supra, p 619; Dalton v Herbruck Egg Sales Corp, 164 Mich App 543; 417 NW2d 496 (1987); Butzer v Camelot Hall Convalescent Centre, Inc, 183 Mich App 194; 454 NW2d 122 (1989). Defendant’s handbook promises fairness to all employees and good working conditions. In return, the manual expresses the company’s expectation of the best efforts of the employees. It speaks of mutual trust, responsibilities, and standards of conduct. The handbook also sets out certain prohibited practices in eight numbered paragraphs. In explaining the consequences of violating these rules, the handbook explains, "For the protection of yourself and your fellow workers, disciplinary action up to and including discharge may be made necessary by the violation of these rules.” The disclaimer under a heading of "In Conclusion” at the end of the handbook says that the book is for information only and that no contract is created, but that the employer believes "wholeheartedly” in the plans, policies, and procedures set out. This single paragraph on page seventeen of the handbook also reserves to the employer the right to change anything in the book, with or without notice. We hold that the handbook raises a genuine issue of fact regarding whether a contract of employment providing termination only for just cause existed in this case. Defendant created an appearance of fair dealing throughout sixteen pages of the handbook, particularly with the mention of "disciplinary action up to and including discharge” (emphasis added). By way of the "Conclusion” on the last page, the company then claims the prerogative to deny its employees any rights to fair treatment under the discipline policy (or any of the other policies stated in the handbook) by simply ignoring it. This at least raises the specter of an illusory promise meant to benefit the employer by inducing the workers to conduct themselves as if they have job security, all the while retaining the benefit of denying that security when it sees fit. We conclude that the evidence before the trial judge created a question of fact regarding whether plaintiff had a reasonable expectation that he could be discharged only for just cause. Summary disposition was improper, and we reverse and remand for further proceedings consistent with this opinion. We do not retain jurisdiction.

Remanded
Farrell v. Automobile Club
8979Oct 25, 1990Michigan

FARRELL v AUTOMOBILE CLUB OF MICHIGAN (ON REMAND) Docket No. 124209. Submitted December 26, 1989, at Lansing. Decided October 25, 1990; approved for publication January 16, 1991, at 9:10 a.m. Bruce Farrell brought an action for wrongful discharge in the Kent Circuit Court against the Automobile Club of Michigan, alleging that the termination of his employment as a sales representative was both a breach of an express agreement based on an oral promise by his supervisors and a breach of the implied contract of employment which arose out of the legitimate expectations he formed from the policies implemented by the defendant. Following a jury trial, the court, George R. Cook, J., denied the defendant’s motions for judgment notwithstanding the verdict, a new trial, or remittitur and entered judgment on the jury’s award of $150,000. The Court of Appeals affirmed the finding of liability, but remanded for reduction to present value the award of future damages. 155 Mich App 378 (1986). The Supreme Court, in lieu of granting leave to appeal, remanded the case to the Court of Appeals for reconsideration in light of Bullock v Automobile Club of Michigan, 432 Mich 472 (1989), and In re Certified Question, Bankey v Storer Broadcasting Co, 432 Mich 438 (1989). 433 Mich 913 (1989). On remand, the Court of Appeals held: An employment contract providing that an employee may not be discharged except for good cause may be established either by oral or written express agreement or as a result of the employee’s legitimate expectations grounded in an employer’s policy statements. The plaintiff’s claim in this case includes both express-agreement and legitimate-expectations aspects. Thus, because neither the trial court nor the Court of Appeals in its earlier decision, analyzed these theories separately, and because the trial court’s instructions to the jury failed to differentiate between these theories, the initial jury verdict must be set aside and a new trial held. Upon retrial, the jury must be instructed separately with respect to both the express-agreement and legitimate-expectations aspects of the plaintiffs claim. References Am Jur 2d, Master and Servant §§ 27, 32, 33, 37, 43, 45, 67. See the Index to Annotations under Discharge from Employment or Office. 1. The legitimate expectations of an employee formed as a result of employment policies adopted by the employer may create an enforceable contractual right; however, the employer, in the absence of an express reservation to the contract, may unilaterally modify its employment policies. A modified employment policy is legally effective if the employee is given reasonable notice of the change and the change is not made in bad faith. In this case, the legal effect of the policy change is dependent upon resolution of unresolved questions of fact regarding the manner in which the change was made. 2. There was sufficient evidence to create questions of fact regarding whether there was an express agreement, whether the defendant’s quota system constituted an offer to modify contrary terms of the express agreement, and whether the plaintiff accepted without protest. Reversed and remanded for a new trial. Master and Servant — Wrongful Discharge — Jury Instructions — Legitimate Expectations — Express Contracts. An employment contract providing that an employee may not be discharged except for good cause may be established either by oral or written express agreement or as a result of the employee’s legitimate expectations grounded in an employer’s policy statements; in a wrongful discharge action in which the employee claims that discharge could have been had for good cause only and the employer claims that the employment was terminable at will, instruction of the jury must clearly differentiate between claims based on legitimate expectations and claims based on an express agreement. Schenk, Boncher & Prasher (by Gary P. Schenk and Fred D. Hartley), for the plaintiff. Fox & Grove (by Kalvin M. Grove and Steven L. Gillman), and Finkel, Whitehead & Selik (by Robert J. Finkel), for the defendant. ON REMAND Before: Maher, P.J., and Sawyer and Weaver, JJ. Per Curiam. This matter is before us on remand from our Supreme Court for reconsideration in light of In re Certified Question, Bankey v Storer Broadcasting Co, 432 Mich 438; 443 NW2d 112 (1989), and Bullock v Automobile Club of Michigan, 432 Mich 472; 444 NW2d 114 (1989). The parties filed supplemental briefs, and oral argument again was held. Previously, we affirmed a jury verdict in favor of plaintiff, but remanded for adjustment of damages. Farrell v Automobile Club of Michigan, 155 Mich App 378; 399 NW2d 531 (1986). Upon reconsideration, we reverse and remand for a new trial. Plaintiff, who had been employed by defendant as a sales representative in Grand Rapids and compensated by commissions since October 1976, commenced this breach of contract action, alleging that his termination on May 21, 1982, for failure to fulfill the requirements of a minimum production level imposed in September 1981 was without good cause because an employment contract had been established in which defendant agreed not to impose enforceable minimum production levels on him. As reported in our prior decision, plaintiff relied on four pieces of evidence to support his claim that such a contract had been established: The first piece of evidence consisted of the parties’ stipulation that prior to 1981 defendant had not enforced any sales quotas on its sales representatives and had not dismissed or demoted any of its sales representatives for failure to achieve quotas or production standards. Secondly, plaintiff presented evidence that his branch manager, Mr. Fennech, had informed him at the time he was hired that his responsibility was to sell some insurance and to make his "book” of insurance grow. According to plaintiff, Fennech told him at the time of his hiring that he need only handle his book of business, sell some insurance and he would be set financially for the rest of his life if he worked at it for three or four years. Thirdly, plaintiff established at trial that at the time of his hiring Fennech handed him a Sales Rules Manual which provided that he was required to sell some insurance as a condition of continued employment, but which did not refer to a quota or minimum level of sales that he was required to meet. Plaintiff testified that the only requirements imposed by the Manual were that he produce some new business, memberships and insurance. Finally, plaintiff also presented evidence to the effect that at the time defendant’s employee union in Detroit was negotiating with defendant, regarding a new contract with defendant which included minimum sales production requirements, the regional manager, Mike Mallott, informed plaintiff that he need not be concerned about the union contract because it would not apply to the Grand Rapids employees. According to plaintiff, Mallott told him that if the union contract contained something better than what the employees currently had, the Grand Rapids employees would also be benefitted, but if it contained something worse, it would not affect them. [Id., pp 383-384.] Defendant contends that it had a legal right to impose additional requirements on its employees as a condition of continued employment, that its imposition of a minimum production level in September 1981 constituted a valid term of plaintiffs employment contract, and that plaintiff properly could be discharged for failing to comply with the new requirement. Farrell, pp 381-382. In Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579, 598; 292 NW2d 880 (1980), our Supreme Court held that an employment contract providing that an employee may not be discharged except for good cause may be established in alternative ways, "either by express agreement, oral or written, or as a result of an employee’s legitimate expectations grounded in an employer’s policy statements.” The differences between these alternative theories (legitimate expectations versus express agreement), including the right of an employer to unilaterally modify an employment relationship through policy changes, was discussed in Bullock and In re Certified Question. Indeed, Bullock noted that prior decisions had done little to clarify the relationship between these two theories. Id., p 479, n 7. In the instant case, both parties agree that plaintiffs claim includes both express-agreement and legitimate-expectations aspects. The policy-based legitimate-expectations aspect of plaintiffs claim is reflected in his asserted reliance on the provisions of defendant’s sales manual, as well as defendant’s failure to enforce any sales quotas prior to 1981. The express agreement aspect of plaintiffs claim is based upon the oral statements of both Fennech and Mallott. In neither the trial court nor in our prior decision were these two theories analyzed separately. Accordingly, in light of Bullock and In re Certified Question, we do so now. THE LEGITIMATE-EXPECTATIONS CLAIM To the extent that an employee’s relationship with his employer is controlled by his policy-based legitimate expectations, the Supreme Court has made clear in In re Certified Question that an employer may, without an express reservation of the right to do so, modify the employment relationship through unilaterally imposed policy changes so as to change a discharge-for-cause relationship to one of termination at will. Id., p 441. Thus, we find in this case that, with respect to the legitimate-expectations aspect of plaintiff’s claim, defendant had a legal right to modify the employment relationship through the unilateral adoption of its policy requiring adherence to minimum production levels. Nevertheless, this right is not without limitations, and, in this case, we conclude that the legal effect of the policy change is dependent on resolution of unresolved factual issues which remain concerning the manner in which the change was instituted by defendant. First, as the Court stated in In re Certified Question, supra, p 457, "to become legally effective, reasonable notice of the change must be uniformly given to affected employees.” In this case, one week’s notice was provided prior to the institution of enforceable minimum sales levels. Considering the nature of the change, we agree with plaintiff that the question whether "reasonable notice” was given is one for the jury. Second, the Supreme Court also cautioned against the assumption that its holding would be applicable to bad-faith policy changes. Id., pp 456-457. Considering plaintiff’s suggestion throughout this matter that the quota system was instituted in response to employee unionizing activity, and also, as a means of forcing commission-based salesmen into potentially less lucrative positions as salary-based "member-advisors,” the question whether defendant enacted its policy change in good faith is also one for the jury. THE EXPRESS-CONTRACT CLAIM As previously discussed, plaintiff also claims to have had an express agreement with defendant that any minimum sales quotas would not be enforced against him. Initially, we disagree with defendant that there was insufficient evidence of an express contract to submit this claim to a jury. In making this argument, defendant first contends that the Fennech and Mallott statements were too indefinite as a matter of law to create an express oral contract. We disagree. In Bullock, supra, pp 480-481, the Court noted that in Toussaint and its companion case, Ebling v Masco Corp, the testimony concerning promises by the defendants’ corporate officers that the plaintiffs would not be discharged as long as they were doing their job had been held to be sufficient to justify submitting to a jury the issue whether an express agreement existed. We further note that in Bullock an express agreement was alleged on the basis of statements similar to those made in this case. See Id., pp 475-476. Concerning these statements, Justice Levin stated in his separate opinion: Nor did the oral statements made to Bullock at the time of hiring necessarily lack the definiteness required to form a binding contract as a matter of law. Oral statements may be as binding as written statements. [Id., p 501.] It is suggested that the expressions relied on by Bullock were not " 'clear and unequivocal.’ ”... [T]here is no rule of law requiring that a contract that need not be in writing be more specific or clear and less equivocal when it is oral than when it is in writing. [Id., pp 508-509.] The testimony in this case described promises that were no less definite than those statements referred to above. Accordingly, we similarly conclude that the testimony was sufficient to justify submitting to a jury the issue whether an express agreement existed. Defendant further argues that Fennech’s and Mallott’s statements were improperly considered by the jury because they were made without authority, not based upon sufficient consideration, or void under the statute of frauds. These same arguments were raised, discussed, and rejected in our prior decision, in which we concluded that defendant’s arguments were largely factual and that sufficient evidence had been presented by plaintiff to establish that reasonable minds could differ concerning the factual disputes. See Farrell, supra, pp 384-386. Because those issues were not addressed either in In re Certified Question or Bullock, we conclude that our prior resolution of them remains unaffected. Having decided that sufficient evidence was presented to enable the jury to find an express agreement, our attention now shifts to consideration of the effect of defendant’s unilateral adoption of minimum sales quotas to the extent that the adoption conflicts with the terms of any express agreement found to exist. The ability of an employer to modify, through generally applicable policy changes, contract terms controlled by an express agreement was only briefly touched upon in Bullock. As discussed in Bullock, supra, pp 481-482, amendment of an employer’s generally applicable policies will not necessarily modify a prior express agreement: Likewise, it cannot be said that where an express agreement is alleged preceding an employment manual, the alleged promise is, as a matter of law, unenforceable. ... [In re Certified Question] does not establish that amendments to employment manuals must be construed to be modifications of a distinct, express, or implied-in-fact contract. However, Bullock did recognize that policy amendments could be construed as an "offer to modify” contrary terms of a prior express agreement. Id., p 483. Citing Bullock, defendant argues that its imposition of a policy requiring adherence to minimum sales levels constituted an offer to modify any contrary express agreement alleged by plaintiff and that acceptance of this offer was manifested where plaintiff "clearly continued employment thereafter, without protest.” We cannot accept this argument, however, because we conclude from our review of the record that a sufficient factual dispute existed concerning whether plaintiff’s continued employment was "without protest.” Moreover, we agree with plaintiff that acceptance cannot be presumed from the mere fact of continued employment; otherwise, how would such an offer ever be rejected, absent one leaving employment? Rather, to the extent defendant’s policy change constituted an offer to modify contrary terms of a prior express agreement, the question whether plaintiff accepted such an offer must be determined from the acts and circumstances of the parties, including their written or spoken words or by other acts or conduct. Ludowici-Celadon Co v McKinley, 307 Mich 149, 153; 11 NW2d 839 (1943). Accordingly, to the extent that a contrary express agreement is found to have been established, it is up to the factfinder to further determine whether the agreement was subsequently modified by virtue of an acceptance, on plaintiff’s part, of defendant’s policy-based "offer to modify.” CONCLUSION A primary area of dispute in both the lower court and in the parties’ initial appeal concerned the instructions to the jury. The jury instructions in this case failed to differentiate between plaintiff’s separate express-agreement and legitimate-expectations theories. While traditional contract-forming mechanisms such as mutual assent or individual detrimental reliance need not be present to establish contractual rights under a legitimate-expectations theory, Toussaint, supra, pp 614-615; In re Certified Question, supra, p 454, the same is not true for those rights asserted under an express agreement. Further, the employer’s ability to modify those rights determined to have been established also differs under the two theories. In light of the differences with respect to both the formation and modification of contractual rights under the two theories, we conclude that the absence of jury instructions appropriately differentiating between them requires that the initial jury verdict be set aside and a new trial held. Upon retrial, the jury must be instructed separately with respect to both the express-agreement and legitimate-expectations aspects of plaintiff’s claim in light of both In re Certified Question and Bullock, as well as this opinion. Reversed and remanded for proceedings consistent with this opinion. We do not retain jurisdiction.

Remanded
Garner v. Michigan State University
8979Oct 15, 1990Michigan

GARNER v MICHIGAN STATE UNIVERSITY Docket No. 116980. Submitted April 3, 1990, at Lansing. Decided October 15, 1990. Leave to appeal applied for. David Garner brought a wrongful discharge action in the Ingham Circuit Court against Michigan State University and its Board of Trustees, the College of Human Medicine and Department of Psychiatry. Plaintiff filed a complaint for mandamus and other relief. After a show cause hearing, the trial court, Lawrence M. Glazer, J., found that plaintiff had been granted tenure status by the university and that the Board of Trustees’ policy on dismissal of tenured faculty for cause governed the dispute. The court issued a writ of mandamus ordering defendants to return plaintiff to his employment and the employment to continue until such time as action is taken pursuant to the university’s policy on dismissal of tenured faculty for cause. Defendants appealed by leave granted. The Court of Appeals held: 1. Plaintiff had constitutional property rights which could only be terminated by procedures that met due process. Defendants’ reliance on the rescission doctrine is a "retrospective fiction” that cannot be interposed to justify a deprivation of property without due process. Plaintiff had a clear right to be returned to his employment and to be terminated only in conformity with defendants’ policy on dismissal of tenured faculty for cause. 2. Plaintiff was denied, without due process, his property right to continued employment because he received no posttermination hearing. 3. The writ of mandamus was properly issued. 4. The use of mandamus to enforce a property right was appropriate. Alternate legal remedies available to plaintiff would not have been truly adequate. _5. Defendants’ claim that the courts should defer, on public policy grounds, to those responsible for academic administration was denied. References Am Jur 2d, Mandamus §§ 4, 64, 69, 248. Construction and effect of tenure provisions of contract or statute governing employment of college or university faculty member. 66 ALR3d 1018. Affirmed. 1. Mandamus — Duty — Legal Remedies. A plaintiff must have a clear legal right to the performance of the specific duty sought to be compelled and the defendants must have a clear legal duty to perform the same in order for the plaintiff to obtain a writ of mandamus; in addition, the plaintiff must be without an adequate legal remedy. 2. Mandamus — Appeal. A trial court’s decision to grant a writ of mandamus will not be reversed absent an abuse of discretion, nor will the trial court’s findings of fact underlying the granting of the writ be disturbed unless they are clearly erroneous. 3. Master and Servant — Public Employees — Due Process. A public employee, including a tenured professor employed by a public university, enjoys a property right in continued employment which the state may only take away in accordance with due process. 4. Master and Servant — Public Employees — Due Process. A posttermination hearing may be required in order to afford a tenured public employee due process where, prior to his termination, the employee was entitled to no more than oral or written notice of the charges against him, an explanation of the employer’s evidence, and an opportunity to present his side of the story. 5. Mandamus — Disputed Facts. A writ of mandamus may not be issued when based on disputed facts; the writ may be issued when some facts are in dispute where the only facts relevant to the determination whether the writ should be issued are undisputed. 6. Mandamus — Contracts — Property. Where a right or duty sought to be enforced rests wholly on contract, mandamus cannot issue to enforce it, because legal and equitable remedies afford relief; mandamus may lie, under appropriate circumstances, to enforce a property right. 7. Actions — Constitutional Rights — Remedies. The temporary loss of a constitutional right constitutes irreparable harm which cannot be adequately remedied by an action at law. White, Beekman, Przybylowicz, Schneider & Baird, P.C. (by Arthur R. Przybylowicz), for plaintiff. Office of the General Counsel, Michigan State University (by Michael J. Kiley and Kurt E. Krause), for defendants. Before: Wahls, P.J., and Marilyn Kelly and G. S.. Allen, JJ. Former Court of Appeals judge, sitting on the Court of Appeals by assignment. G. S. Allen, J. In this suit for wrongful discharge, we are asked to decide the propriety of a writ of mandamus issued April 24, 1989, by the Ingham Circuit Court, ordering defendants to reinstate plaintiff, although not to "any particular position,” and further ordering defendants not to dismiss plaintiff without a hearing as mandated by defendant university’s policy on the dismissal of tenured faculty for cause. We find the writ properly issued and, therefore, affirm. Plaintiff is a psychologist and renowned expert in the field of "eating disorders,” primarily anorexia and bulimia. From early 1978 until December, 1987, he was employed by the University of Toronto, first as a lecturer and later as a full professor. In November, 1987, plaintiff’s certification to practice clinically was suspended for two years for professional misconduct involving sexual contact with one of his former patients at the University of Toronto. He was subsequently asked to resign from the university and he did so in December, 1987. In early 1988, Lionel Rosen, M.D., a professor of psychiatry at the Michigan State University College of Human Medicine, contacted plaintiff regarding possible appointment to the university. Rosen advised plaintiff to write W. Donald Weston, Dean of the College of Human Medicine, and explain the circumstances regarding his suspension from clinical practice and his resignation from the University of Toronto. Plaintiff did so by letter February 28, 1988. In April and May of 1988 plaintiff was interviewed by Weston and Donald Williams, chairman of the university’s Department of Psychiatry, and on June 21, 1988, was offered a tenured position as a professor of psychiatry in the Colleges of Human and Osteopathic Medicine at a beginning annual salary of $56,000. At a meeting of the university’s Board of Trustees on July 30, 1988, the board approved plaintiff’s appointment as professor "with Tenure, effective September 1, 1988.” On January 16, 1989, plaintiff informed Weston and Williams that a new charge of sexual misconduct had been filed against him in Ontario. On January 20, 1989, Weston wrote Provost David Scott recommending that plaintiff’s employment with Michigan State University be terminated. The letter stated in pertinent part: In preemployment discussions with both me and Dr. Williams, the focus was on Dr. Garner’s professional and ethical fitness. Dr. Williams and I each inquired of Dr. Garner regarding the possibility of other outstanding complaints of sexual inpropriety [sic]. He denied the same and steadfastly maintained that the complaint which led to his resignation from the University of Toronto and the professional discipline meted out by the obep [Ontario Board of Examiners in Psychology] was an isolated instance and that his gorss [sic] misjudgment was an aberration in an otherwise unblemished career as a psychologist. Dr. Williams specifically asked Dr. Garner whether he had ever had sexual relations with any other of his patients and Dr. Garner was unequivocal in his denial. He was clear in this point, the only point of concern that really mattered in our evaluation as to the viability of his candidacy. On Monday, January 16, 1989, Dr. Garner advised me that the obep had, on December 29, 1988, notified him of a new hearing of a charge of professional misconduct relating to an alleged sexual relationship with another of his former patients. He did not deny the charges. Dr. Garner further stated that he had intimate relations with a number of other former patients over the years. On the same date Williams wrote to Weston recommending plaintiffs dismissal. In the letter, Williams stated that he telephoned plaintiff on the evening of January 16, inquiring about the new allegation of sexual misconduct, and that plaintiff admitted to him that the new allegations were true. The letter continued as follows: I then reminded him that during his preemployment interviews I had asked him if he had had any other instances of sexual contact with his patients and he told me no. Dr. Garner then said that he thought I was asking if he had any other charges of sexual misconduct pending. I then asked him again whether he has had additional sexual contact with his patients. Dr. Garner then told me he had had sexual contact with a patient in 1983 and numerous sexual contact [sic] with patients in the 1970’s. Many of these contacts in the 1970’s occurred 3-6 months after he had terminated treatment. I then asked him if I was to conclude that he had engaged in sexual relations with most of his patients or former patients he treated in the 1970’s. Dr. Garner replied my conclusion was correct. I then asked him why he had not told me these facts when I had, in fact, asked him about his sexual contact last Spring. Dr. Garner replied, "I was afraid I wouldn’t get the job.” I replied, "You’re right—you wouldn’t have.” Provost Scott requested that plaintiff attend a meeting on January 26, 1989, to discuss the letters which he had received regarding the new allegations of sexual misconduct. Present at the meeting were plaintiff, his attorney, Provost Scott and two members of the university’s general counsel. Neither Weston nor Williams attended the meeting. According to plaintiff, the meeting consisted of plaintiff’s being asked a series of questions which he answered to the best of his ability. He may have been asked for his side of the story. At no time, however, was plaintiff given the opportunity to confront his accusers, to cross-examine them, or to call witnesses in his own defense. After reviewing plaintiff’s remarks made during the January 26, 1989, meeting, conferring with Weston and Williams, consulting with the university’s counsel, and meeting with the university’s Board of Trustees, Provost Scott, under authorization from the board, rescinded plaintiff’s employment contract on February 6, 1989. It is undisputed that the university established a policy, approved by the Board of Trustees on June 24, 1977, entitled "Dismissal of Tenured Faculty for Cause.” The policy provides for full adversarial proceedings before termination, which the university in the instant case did not provide. Instead, the university chose to rescind plaintiffs contract. When plaintiffs attempts to have the dispute resolved by the university’s Committee on Faculty Tenure were rejected, plaintiff filed a complaint for mandamus and other relief in the Ingham Circuit Court on March 21, 1989. At a show cause hearing held April 17, 1989, plaintiff testified that at no time was he given an opportunity to cross-examine his accusers or call witnesses on his own behalf. He also testified that, if granted a hearing, he would deny that he lied in his preemployment interviews or made any misrepresentations during the initial interviews. Finally, plaintiff testified that, if granted a hearing, he would contest the allegation of Williams that, in a telephone conversation with Williams on January 16, 1989, plaintiff admitted to sexual misconduct with numerous former patients. At the conclusion of the show cause hearing, the trial court found that plaintiff was granted tenure status by the university and that the Board of Trustees’ policy on dismissal of tenured faculty for cause governed the dispute. Accordingly, the court issued a writ of mandamus ordering defendants to return plaintiff to his employment and the employment to continue until such time as action is taken pursuant to the university’s policy on dismissal of tenured faculty for cause. By order dated June 16, 1989, this Court granted defendants’ application for leave to appeal but denied stay of the trial court’s order._ On appeal, defendants raise four issues which we have reformulated as five issues, hereinafter addressed. i WERE DEFENDANTS RELIEVED OF THEIR DUTY TO AFFORD PLAINTIFF DUE PROCESS BECAUSE PLAINTIFF ALLEGEDLY LIED IN HIS PREEMPLOYMENT INTERVIEW, THEREBY AFFORDING DEFENDANTS THE RIGHT TO RESCIND PLAINTIFF’S EMPLOYMENT CONTRACT? We begin our analysis by stating the rules of law governing the issuance of mandamus. To obtain a writ of mandamus, "the plaintiff must have a clear legal right to the performance of the specific duty sought to be compelled and the defendants must have a clear legal duty to perform the same.” State Bd of Ed v Houghton Lake Community Schools, 430 Mich 658, 666; 425 NW2d 80 (1988). In addition, the plaintiff must be without an adequate legal remedy. Cyrus v Calhoun Co Sheriff, 85 Mich App 397, 399; 271 NW2d 249 (1978). A trial court’s decision to grant a writ of mandamus will not be reversed absent an abuse of discretion. The trial court’s findings of fact underlying the granting of the writ will not be disturbed unless clearly erroneous. Michigan Waste Systems, Inc v Dep’t of Natural Resources, 157 Mich App 746, 760; 403 NW2d 608 (1987), lv den 428 Mich 900 (1987). Defendants argue that plaintiff’s otherwise existing right to a tenure hearing was abrogated because, under common law, defendants had the right to rescind plaintiff’s contract upon learning that plaintiff had lied during his preemployment interviews. In support of this position defendants rely primarily oh Morgan v American University, 534 A2d 323 (DC App, 1987). In Morgan, the plaintiff applied for a "tenure-track” faculty position with American University but failed to disclose that he already held a position at another university. Upon discovering this fact, American University rescinded the plaintiff’s contract without complying with the contractual notice and hearing procedures set forth in the faculty manual. Id., p 324. The Morgan court held that the common-law right to rescission was not abrogated by the notice and hearing provisions in the plaintiff’s contract. Therefore, the university could rescind the plaintiff’s contract. Id., pp 330-331. Morgan is distinguishable in two material respects. First, in Morgan the plaintiff conceded that, in his preemployment interview, he did not inform the university that he was employed at another school. In the instant case, plaintiff denied that he ever admitted to his accusers that, while employed at the University of Toronto, he had sexual relations with numerous former patients. Thus, unlike in Morgan, in the instant case a dispute exists as to the underlying facts relied upon by defendants to justify an exercise of the common-law right of rescission. Second, Morgan involved a private university, whereas the instant case involves a public university. This distinction is crucial. Procedural due process guarantees apply only in the presence of a "property” or "liberty” interest within the meaning of the Fifth or Fourteenth Amendment. Williams v Hofley Mfg Co, 430 Mich 603, 610; 424 NW2d 278 (1988), reh den 431 Mich 1202 (1988), app dis 489 US 1001; 109 S Ct 1102; 103 L Ed 2d 168 (1989). Any right to continued employment enjoyed by an employee of a private employer arises out of the employment contract. Such contractual rights do not rise to the level of a protected property interest. Morgan, 534 A2d 331; See also Matulewicz v Governor, 174 Mich App 295, 304; 435 NW2d 785 (1989), lv den 434 Mich 866 (1990). However, a public employee enjoys a property right in continued employment which the state may only take away in accordance with due process. Michigan State Employees Ass’n v Dep’t of Mental Health, 421 Mich 152, 160-161; 365 NW2d 93 (1984). This includes tenured professors employed by a public university. Bd of Regents of State Colleges v Roth, 408 US 564; 92 S Ct 2701; 33 L Ed 2d 548 (1972). Therefore, plaintiff, as a public employee and tenured professor, enjoyed a greater right to continued employment than did the privately employed plaintiff in Morgan. Having distinguished Morgan, we find the United States Supreme Court’s decision in Cleveland Bd of Ed v Loudermill, 470 US 532; 105 S Ct 1487; 84 L Ed 2d 494 (1985), dispositive. In Loudermill, the plaintiff, a public employee, was terminated from his position as a security guard after the school board discovered he had falsely stated on his employment application that he had not been convicted of a felony. He received no pretermination hearing. However, a posttermination hearing was held. Id., p 535. The Supreme Court held that some kind of pretermination hearing was required to comply with due process. Id., pp 542-548. The board of education’s argument that Louder-mill had no property right because he obtained his employment by lying was rejected in a footnote early on in the opinion: The Cleveland Board of Education now asserts that Loudermill had no property right under state law because he obtained his employment by lying on the application. It argues that had Loudermill answered truthfully he would not have been hired. He therefore lacked a "legitimate claim of entitlement” to the position. For several reasons, we must reject this submission. First, it was not raised below. Second, it makes factual assumptions—that Loudermill lied, and that he would not have been hired had he not done so—that are inconsistent with the allegations of the complaint and inappropriate at this stage of the litigation, which has not proceeded past the initial pleadings stage. Finally, the argument relies on a retrospective ñction inconsistent with the undisputed fact that Loudermill was hired and did hold the security guard job. The Board cannot escape its constitutional obligations by rephrasing the basis for termination as a reason why Louder-mill should not have been hired in the first place. [470 US 539, n 5. Citation omitted.] Accordingly, we conclude that plaintiff in the instant case, like Loudermill, had constitutional property rights which could only be terminated by procedures that met due process. Defendants’ reliance on the rescission doctrine is a "retrospective fiction” that cannot be interposed to justify a deprivation of property without due process. Therefore, plaintiff had a clear right to be returned to his employment and to be terminated only in conformity with defendants’ policy on dismissal of tenured faculty for cause. Defendants had a concomitant duty to perform the same. ii DID THE PRETERMINATION PROCEDURE FOLLOWED IN THE INSTANT CASE AFFORD PLAINTIFF DUE PROCESS? Defendants next argue that even if they were required to afford plaintiff due process, they were not necessarily required to afford plaintiff the due process set forth in that portion of the faculty handbook entitled "Dismissal of Tenured Faculty for Cause.” According to defendants, the nearly three-hour meeting between Provost Scott and plaintiff and his attorney satisfied the due process required by Loudermill. We disagree. In support of their claim, defendants cite the following language from Loudermill: The tenured public employee is entitled to oral or written notice of the charges against him, an explanation of the employer’s evidence, and an opportunity to present his side of the story. To require more than this prior to termination, would intrude to an unwarranted extent on the government’s interest in quickly removing an unsatisfactory employee. [470 US 546. Citations omitted.] The flaw in defendants’ claim is the conclusion that, in so ruling, the Court in Loudermill held no posttermination hearing need be provided. The Loudermill decision clearly provides that the minimal pretermination procedure which it outlined is not alone adequate to satisfy due process. The Court noted that it had formerly stated that " '[t]he formality and procedural requisites for the hearing can vary, depending upon the importance of the interests involved and the nature

Plaintiff Win
Plymouth Stamping v. Lipshu
8790Sep 12, 1990Michigan

PLYMOUTH STAMPING, DIVISION OF ELTEC CORPORATION v LIPSHU Docket No. 83206. Argued October 4, 1989 (Calendar No. 1). Decided September 12, 1990. Mike Lipshu, Jr., and other employees of Plymouth Stamping, Division of Eltec Corporation sought unemployment compensation benefits after the company proposed during contract negotiations with the employees’ union that replacement employees, hired by Plymouth while a strike was in progress, would be permanently retained. The initial decision by the Employment Security Commission denying unemployment compensation benefits on the basis of the labor dispute disqualification provisions of the Employment Security Act, MCL 421.29(8); MSA 17.531(8), was reversed after it was determined at an evidentiary hearing that the strikers were entitled to unemployment benefits from the date the employer hired permanent replacements. The mesc Board of Review affirmed. The Wayne Circuit Court, William Leo Cahalan, J., affirmed. The Court of Appeals, D. E. Holbrook, Jr., P.J., and Hood and N. J. Kaufman, JJ., affirmed, holding that, although strikers should be disqualified from receiving benefits during a strike even if an employer hires replacements, that disqualification should end when and if the employer announces that the replacements will remain as permanent employees (Docket No. 95816). Plymouth Stamping appeals. I. In opinions by Justice Archer, by Justice Boyle, joined by Justice Cavanagh, and by Justice Levin, the Supreme Court held: Strikers who are permanently replaced by their employer during the course of a strike are not disqualified for unemployment benefits under MCL 421.29(8); MSA 17.531(8), but are _eligible for benefits from the time of replacement until a subsequent event renders the labor dispute a substantial contributing cause of their unemployment. References Am Jur 2d, Unemployment Compensation § 80. Unemployment compensation: labor dispute disqualification as applicable to striking employee who is laid off subsequent employment during strike period. 61 ALR3d 766. II. In opinions by Justice Levin, and by Justice Brickley, joined by Chief Justice Riley and Justice Griffin, the Supreme Court further held: The case is remanded to the Employment Security Commission for further proceedings. Justice Archer stated that as of January, 1981, the substantial contributing cause of the workers’ unemployment was the fact that their jobs ceased to exist. Because the workers no longer voluntarily ceased their employment after they had been permanently replaced, they were eligible for unemployment compensation. To the extent their refusal to apply for work with their former employer after their replacement caused their unemployment, they cannot be disqualified absent a finding that they refused to apply for available work, suitable under §§ 29(6) and 29(7). The decisions of the mesc, the circuit court, and the Court of Appeals should be affirmed. The question presented in this case is one of mixed law and fact, and the decision of the Supreme Court should have as its authority the intent of the Legislature. Where, as in this case, the Legislature has not made clear whether it intended that striking workers who have been permanently replaced be disqualified from receiving unemployment compensation, the Court must construe the act as written to give effect to probable intent. Because the act is remedial, it requires liberal construction. Under the Employment Security Act, all unemployed workers are intended to be compensated except where expressly excluded. Examination of the categories of exempted workers reveals that unemployment compensation was intended to be withheld only where unemployment is caused by a worker’s voluntary act. Permanently replaced employees are neither truly discharged nor do they actually remain employees; rather, they fall into a special category of idled workers whose status under the act can only be defined by the authors of the act. Section 29(8) prohibits unemployment compensation for workers who are out of work because of direct participation in a strike; the disqualification ends, however, where the workers are discharged by the employer. Applying § 29(8) to the facts of this case, it is undisputed that the workers initially were disqualified from receiving unemployment compensation because their unemployment was due to a labor dispute in which they were directly involved. However, in January, 1981, that situation changed when the company permanently replaced them, i.e., their unemployment no longer was voluntary, and a labor dispute no longer was the cause of their unemployment. Rather, the substantial contributing cause of their unemployment was that their jobs ceased to exist. Under § 29(7)(a), the refusal of individual strikers to break ranks with the union and cross picket lines to apply for any available work did not render their unemployment voluntary. The fundamental flaw in the reasoning of the opinion for reversal lies in the importance it places on the union’s continuing demand that permanently replaced strikers return to jobs only as a group. While a permanently replaced worker may be disqualified for refusing to apply for available work, the refusal should not be measured under § 29(8). Workers are not required to apply unconditionally for available work. Under §§29(l)(c) and (e), disqualification will obtain where a worker fails without good cause to accept suitable work of which the worker had notice. Under §§ 29(6) and (7), whether work is suitable depends on a worker’s background and situation and does not include positions made vacant because of a labor dispute, positions that offer substantially less favorable conditions than those prevailing locally, or positions that require resignation from a union. Thus, it would be error to order remand to determine when work became available to each worker without also ordering that a determination be made regarding whether the work was suitable. Remand is not required, however, because the issue regarding a permanently replaced worker’s duty to apply for work with a former employer is not properly before the Court. The labor dispute disqualification ended upon the strikers’ permanent replacement. While the plaintiff challenged the workers’ eligibility for compensation under .§ 29(8), it did not charge that they refused suitable work under §§ 29(l)(c) and (e). The burden of proving disqualification is on the employer. In this case, the employer did not sustain the burden. The opinion for reversal errs in basing the workers’ disqualification on individual failure to apply for work with the plaintiff in the face of their union’s decision to demand group reinstatement. It is not clear that the Legislature intended to create a duty in a union to drop a demand for group reinstatement as a precondition to members’ receipt of unemployment benefits. Creation of such a duty would force a union to abandon collective action, to cease being a union. In addition, had the union dropped its demand, it would have been open to charges that it violated federal labor law by failing to fulfill its duty of fair representation. Justice Boyle, joined by Justice Cavanagh, stated that the labor dispute disqualification provision of the Employment Security Act, § 29(8), ceased to control when the employer notified the strikers that they had been permanently replaced. Permanent replacement severs the causal connection between a strike and unemployment, thereby terminating the labor dispute disqualification. An employer enjoys the protection of § 29(8) only so long as it does not act to alter the employment relation. Permanent replacement of an employee disturbs the status quo of that relation and destroys both the policy considerations and the fundamental underlying assumption behind the disqualification. Whether the employer intended to discharge or merely replace the striking employees is irrelevant to the resolution of this case; rather, it is the fact of permanent replacement, not the particular intent of the employer, that destroys the underlying assumption behind the labor dispute disqualification and thereby prevents its application to the replaced strikers. Given the parties’ presentation of the issue in the Supreme Court, it is inappropriate to address the question whether some other provision of the act may bar the claimants’ recovery. Remand is also inappropriate since the employer has already had the opportunity to prove which of the sixteen permanently replaced employees would have been reinstated. Its failure to do so should not entitle it to another opportunity, but rather should be outcome determinative. Justice Levin stated that when the employer, exercised its right to hire permanent replacements, the strike was not at that moment a substantial contributing cause of the claimants’ unemployment, and the claimants were eligible for benefits from that time forward until any succeeding events again rendered the labor dispute a substantial contributing cause of the claimants’ unemployment. The present record is not sufficient for a determination regarding individual claimants of whether the labor dispute, at some point after the employer’s exercise of its right to hire permanent replacements, again became a substantial contributing cause of the unemployment, requiring remand to the Employment Security Commission for further factual development regarding the availability of work at Plymouth Stamping after the employer first conferred permanent status on the replacement employees, and regarding other bases regarding the claimants’ eligibility for benefits. Justice Brickley, joined by Chief Justice Riley and Justice Griffin, stated that where, as in this case, the facts presented indicate that economic strikers decline to accept a limited number of vacancies offered by an employer, and as a condition of ending the strike demand instead the immediate reinstatement of all strikers, all such strikers should remain disqualified from receiving unemployment benefits because of the continuance of a labor dispute in active progress. While the Employment Security Act reflects a primary legislative purpose of protecting wage earners against the evils incident to involuntary unemployment, the labor dispute disqualification provisions of the act enunciate an explicit preference to deny compensation for employees unemployed because of direct participation in an active labor dispute. The labor dispute disqualification provision explicitly precludes the strikers in this case from receiving unemployment benefits because a labor dispute continued in active progress even after the employer permanently replaced them. The union initially offered to return to work unconditionally and to end the labor dispute. However, the striker’s demand to return only as a group rather than as vacancies occurred constituted a new demand, separate from the earlier economic demands, which continued the labor dispute and constituted a substantial contributing cause of the strikers unemployment. While the strikers remained on strike over the issue of reinstatement, their demand for group reinstatement also precluded reemployment of those strikers for whom vacancies existed and foreclosed a determination of which strikers would have been eligible for benefits because of the presence of replacement employees and the reemployment of strikers who would have been rehired as future openings occurred. Decisions by an mesc referee and the mesc Board of Review may be reversed on appeal only where the decisions are contrary to law or are not supported by competent, material, and substantial evidence on the whole record. In this case, however, the legal conclusions of the board and the courts below are error because of the failure to recognize any legal distinction between the termination or permanent discharge of strikers during a strike, as compared with the situation of strikers whose positions have been permanently filled but who retain first call on immediately available and future vacancies but nevertheless continue to strike. Permanently replaced economic strikers are entitled to unemployment compensation where the employer informs them that they either must return to work or face termination. In this case, the strikers did not allege that the employer informed the strikers of termination; to the contrary, the employer testified that it notified the union of the existence of vacancies as they occurred. The strikers did not present evidence indicating an intent by the employer to discharge or terminate them. The record indicated that at least half of the strikers had jobs waiting for them, and the others had reasonable prospects of future reemployment. Thus, the labor dispute continued to be a substantial contributing cause of unemployment. The fact that some, but not all, of the strikers had been replaced should not automatically entitle all the strikers to unemployment benefits as long as they continued the strike. The determination of whether the labor dispute qualifications of MCL 421.29(8); MSA 17.531(8) apply should proceed case by case, on the basis of a determination of whether the labor dispute in active progress continued to be a substantial contributing cause of unemployment. In this case, even though the bargaining position of the strikers to decline any job vacancy unless and until all strikers could return should result in their disqualification, we concur in the remand to the mesc to determine the number of positions that became available after the employer hired permanent replacements, the date when each position became available, which claimant was entitled to fill each position, and whether the employer notified the union of each vacancy. Any striker for whom a position became available during the strike should be ineligible for benefits from the time each position became available. Affirmed and remanded. 168 Mich App 21; 424 NW2d 530 (1988) affirmed. Unemployment Compensation — Labor Dispute Disqualification — Eligibility for Benefits. Strikers who are permanently replaced by their employer during the course of the strike are not disqualified for unemployment benefits under the Employment Security Act, but are eligible for benefits from the time of replacement until a subsequent event renders the labor dispute a substantial contributing cause of their unemployment (MCL 421.29[8]; MSA 17.531[8]). Fitzgerald, Hodgman, Cox, Cawthorne & McMahon (by William L. Hooth) for the appellant. Rothe, Mazey, Mazey & Hamburger, P.C. (by William Mazey), for the appellees. Amici Curiae: Sachs, Nunn, Kates, Kadushin, O’Hare, Helveston & Waldman, P.C. (by Theodore Sachs and Mark Brewer), for Michigan State AFL-CIO. Kim Arthur Siegfried, Assistant General Counsel, United Steelworkers of America, AFL-CIO*CLC, for United Steelworkers of America, AFL-CIO-CLC. Honigman, Miller, Schwartz & Cohn (by Charles H. Tobias and Kevin I. Green) for Guardian Industries Corp. Archer, J. (for affirmance). We granted leave limited to the issue whether the employee-claimants, who were engaged in a strike against their employer, were disqualified for unemployment benefits pursuant to the labor dispute provisions of the Michigan Employment Security Act, MCL 421.29(8); MSA 17.531(8), when they were permanently replaced during the course of the strike. I believe the workers’ disqualification ended upon their permanent replacement and any remand must instruct the mesc to determine the suitability of any available work under § 29 of the MESA. FACTS AND PROCEEDINGS In the fall of 1980, workers and management of the Plymouth Stamping Division of Eltec Corporation were unable to come to an agreement for the renewal of a collective bargaining agreement that expired on September 1, 1980. Negotiations broke down when workers refused to agree to management demands for wage and benefit concessions equaling approximately thirty percent of the workers’ current wages. The workers stayed on the job for one week after the expiration of the old contract, but on September 9, the workers struck the company. The company never ceased production during the strike, operating first with the efforts of management and members of the families of company executives. As the strike progressed, the company gradually hired replacements. At the end of December, 1980, the company informed the replacements that the company considered them permanent; that is, they would be retained even in the event the strike was settled. On January 15, 1981, the company’s attorney informed the union’s chief negotiator that the striking workers had been permanently replaced. In the event the strike was settled, the workers could reapply for work and would be rehired only as openings became available. If they wished to work at Plymouth Stamping, the strikers could only do so under terms imposed by the company. Any strikers who agreed to return to Plymouth Stamping would have to accept the same terms offered the new replacement workers. Upon learning of their permanent replacement, the striking workers applied for unemployment benefits. The Employment Security Commission initially denied benefits, reasoning that the workers were disqualified pursuant to the labor dispute disqualification provision of the mesa, MCL 421.29(8); MSA 17.531(8). The workers appealed to the mesc, which conducted a hearing. At the hearing, the company claimed that it only replaced the workers and did not "discharge” or "terminate” them. The company president testified that between January, 1981, and May, 1982, a total of thirty-seven openings occurred within the strikers’ bargaining unit. The record discloses, however, that the company informed the union of the existence of only seven of those openings in February or March of 1981 when, while in the coffee room of the union office, the company’s attorney told the union negotiator that he had seven openings he "can offer.” While the union ultimately acceded to the economic demands of the company’s final proposal, the company refused the strikers’ last and only demand, that the company rehire the strikers as a group, and not one at a time. Consequently, these claimants refused to apply for work at Plymouth Stamping. A referee found that the workers were entitled to unemployment compensation after January 15, 1981, the date on which they were notified through their union representative of their permanent replacement. The mesc Board of Review affirmed this decision as did the Wayne Circuit Court and the Court of Appeals.1 would also affirm. i The facts of this case disclose the following: In the late 1970’s and early 1980’s, Plymouth Stamping, like many other companies involved in the automotive industry, experienced difficult times. Like other companies in the industry, Plymouth Stamping responded by demanding wage and benefit concessions from its workers—thirty percent cuts in wages and benefits. The wages and benefits the company offered the union actually decreased as negotiations proceeded. As the opinion for reversal aptly points out, the National Labor Relations Board found that the company was engaged in legal "hard bargaining.” Faced with the company’s demands, the workers had three choices. They could accede to the company’s demands (as did many workers in similar situations), they could quit, or they could strike. Had the workers quit, they most likely would have been eligible for unemployment compensation. Leaving work because of substantial changes in wages or conditions of employment constitutes "good cause attributable to the employer” such that a worker will not be disqualified from receiving unemployment compensation under § 29(l)(a) of the mesa. Copper Range Co v Unemployment Compensation Comm, 320 Mich 460; 31 NW2d 692 (1948); Keith v Chrysler Corp, 390 Mich 458; 213 NW2d 147 (1973). Cf. Lasher v Mueller Brass Co, 62 Mich App 171; 233 NW2d 513 (1975). However, the workers wanted to keep t

Mixed Result
Delke v. Scheuren
8979Aug 23, 1990Michigan

DELKE v SCHEUREN Docket No. 119347, 119375. Submitted May 15, 1990, at Marquette. Decided August 23, 1990. Leave to appeal applied for. Jeffrey L. Delke suffered a hernia on September 1, 1982, while lifting bales of hay for his employer, James Scheuren. Delke continued to work for Scheuren until September 26, 1982, and on November 29, 1982, filed a petition with the Bureau of Workers’ Disability Compensation claiming disability as a result of his work-related injury. On September 6, 1983, Delke amended his petition to allege that Scheuren had discharged him and refused to rehire him, in violation of the Workers’ Disability Compensation Act. Delke then withdrew his disability claim and proceeded on only the retaliatory discharge claim. Following a hearing, a referee denied Delke’s claim, finding that Scheuren did not discriminate against Delke in not rehiring him on the basis of the institution of proceedings under the workers’ compensation act. The referee also ruled that the Accident Fund of Michigan was obligated to defend Scheuren and to pay any damages and costs to which Delke may be entitled as a result of the alleged retaliatory discharge. Delke and the Accident Fund both appealed the referee’s decision to the Workers’ Compensation Appeal Board. The wcab vacated the referee’s decision regarding Delke’s claim of retaliatory discharge, holding that neither the referee nor the wcab had authority or jurisdiction to enforce the retaliatory discharge provision of the workers’ compensation act. The wcab also held that it did have jurisdiction to decide the insurance question and that the Accident Fund is obligated to defend Scheuren and to cover any damages and costs awarded in any circuit court action in connection with the alleged retaliatory discharge claim. Delke and the Accident Fund filed, by leave granted, separate appeals from the decision of the wcab. The appeals have been consolidated. The Court of Appeals held: References Am Jur 2d, Workmen’s Compensation §§ 55, 545, 546, 683. Recovery for discharge from employment in retaliation for filing worker’s compensation claim. 32 ALR4th 1221. 1. The wcab correctly determined that the Bureau of Workers’ Disability Compensation does not have jurisdiction to decide a claim of retaliatory discharge. The bureau may award benefits only if it finds that a claimant is disabled within the meaning of the workers’ compensation act, i.e., has suffered a loss of wage-earning capacity. No such loss is demonstrated in a retaliatory discharge action. Furthermore, there is no express legislative conferral of authority on the bureau or the wcab to order reinstatement and back pay, the equitable remedies customarily sought in a retaliatory discharge action. 2. The wcab erred in finding that it had the authority to decide whether the Accident Fund was required to defend and indemnify Scheuren. While the wcab may decide insurance coverage questions in cases where it has properly taken jurisdiction of the claimant’s petition for compensation, it is inappropriate for it to decide the coverage question when jurisdiction over the substantive question of liability is in a court of general jurisdiction. Affirmed in part and reversed in part. 1. Workers’ Compensation — Retaliatory Discharge Actions — Jurisdiction. The Bureau of Workers’ Disability Compensation lacks jurisdiction to decide a retaliatory discharge action; it may award benefits only if it finds that a claimant is disabled within the meaning of the workers’ compensation act, i.e., has suffered a loss of wage-earning capacity; no loss of wage-earning capacity is involved in a retaliatory discharge action, and the bureau lacks the power to award reinstatement and back pay, the equitable remedies customarily sought in a retaliatory discharge action (MCL 418.301[11]; MSA 17.237[301][11]). 2. Workers’ Compensation — Appeal Board. It is inappropriate for the Workers’ Compensation Appeal Board to decide questions of insurance coverage in an action in which jurisdiction over the substantive question of liability is in a court of general jurisdiction. Green, Renner, Weisse, Rettig, Rademacher & Clark, P.C. (by James M. Rettig), for Jeffrey L. Delke. Peterson, Beauchamp, DeGrand, Reardon & Hall, P.C. (by Ralph B. K. Peterson), for Accident Fund of Michigan. Before: Cynar, P.J., and Weaver and Griffin, JJ. Per Curiam. Both plaintiff Jeffrey L. Delke and defendant Accident Fund of Michigan appeal by leave granted from an order of the Workers’ Compensation Appeal Board, which vacated a hearing referee’s decision regarding plaintiff’s claim of retaliatory discharge, but affirmed the referee’s determination that the Accident Fund was obligated to defend the employer, defendant James Scheuren, and to pay any damages and costs to which plaintiff may be entitled as a result of the alleged retaliatory discharge. We affirm in part and reverse in part. Plaintiff suffered a hernia on September 1, 1982, while lifting bales of hay for defendant employer. His last day worked was September 26, 1982. He filed a petition for hearing on November 29, 1982, claiming disability as a result of the work-related injury. On September 6, 1983, plaintiff filed an amended petition, claiming that the employer had discharged him and refused to rehire him in violation of § 301(11) of the act, MCL 418.301(11); MSA 17.237(301X11), which provides: A person shall not discharge an employee or in any manner discriminate against an employee because the employee filed a complaint or instituted or caused to be instituted a proceeding under this act or because of the exercise by the employee on behalf of himself or herself or others of a right afforded by this act. By the time of the hearing, plaintiff apparently withdrew his disability claim and proceeded only on the retaliatory discharge claim. In a decision mailed March 29, 1984, the referee denied the claim, finding as fact "that the employer did not discriminate under § 301(11) in not rehiring petitioner based on the institution of proceedings under the Act.” In response to an inquiry from defendants, a second decision was mailed on June 20, 1984, which included the following additional language: Addendum: Defense counsel rightly argue that a second issue presented and argued at trial was not decided in the above decision: whether or not the insurance carrier had an obligation under the Act to provide a legal defense to the claim of discriminatory non-reemployment of Petitioner under section 301(11). As to this second issue I find that section 621(2) mandates that the carrier had the obligation to defend the employer. But as to the ultimate relief sought by the employer, as limited by the decision finding no discriminatory treatment of Petitioner, I have no power to award costs or damages. Both plaintiff and defendant insurance company appealed. In a decision and order dated June 30, 1989, the wcab vacated the referee’s finding under § 301(11) and denied plaintiffs petition, holding that neither the referee nor the wcab had authority or jurisdiction to enforce § 301(11). The wcab also held, however, that it did have jurisdiction to decide the insurance question and that defendant insurer is obligated to defend the employer and to cover any damages and costs awarded in any circuit court action in connection with the alleged retaliatory discharge claim. Plaintiff contends that the wcab erred in finding that MCL 418.301(11); MSA 17.237(301)(11) does not provide the Bureau of Workers’ Disability Compensation with jurisdiction to hear his discrimination claim. He argues that the amendment of § 301 to include subsection (11) manifests a legislative intent to treat retaliatory discharges as a form of personal injury compensable under the act. Plaintiff notes that prior to the amendment a discharge in retaliation for filing a workers’ compensation claim was actionable as a violation of public policy. Sventko v Kroger Co, 69 Mich App 644; 245 NW2d 151 (1976). Because § 301(11) was therefore unnecessary to create a cause of action for retaliatory discharge, plaintiff concludes that the subsection must have been added in order to create an administrative remedy in addition to any legal remedies. Moreover, plaintiff notes that § 301(11) appears to be patterned after § 65(1) of the Michigan Occupational Safety and Health Act (miosha), MCL 408.1065(1); MSA 17.50(65X1). Plaintiff notes that § 65 in addition to its nonretaliation language provides a detailed administrative scheme for handling retaliation claims culminating in court review under the Administrative Procedures Act, MCL 24.201 et seq.; MSA 3.560(101) et seq. Plaintiff concludes that the Legislature’s failure to include such a scheme in § 301 implies that the Legislature intended retaliation claims to be treated like all other claims under the workers’ compensation act. Finally, plaintiff claims that these conclusions are reinforced by § 841(1) of the act, MCL 418.841(1); MSA 17.237(841X1), which provides: Any dispute or controversy concerning compensation or other benefits shall be submitted to the bureau and all questions arising under this act shall be determined by the bureau or a worker’s compensation magistrate, as applicable. The director may be an interested party in all worker’s compensation cases in questions of law. Because a claim of retaliatory discharge in violation of § 301(11) is a question "arising under this act,” plaintiff concludes that the instant dispute must be submitted to the bureau for determination. On the other hand, defendant argues that in every workers’ compensation claim two questions must be answered: (1) is the claimant disabled; and (2) was the disability caused by the employment. Because plaintiff was not "disabled” within the meaning of the act, there is no true workers’ compensation claim in the instant case. Like plaintiff, defendant notes that § 301(11) appears similar to § 65(1) of miosha, but draws the opposite conclusion. Because the Legislature spelled out an administrative scheme to remedy violations of the nonretaliation language of miosha, the Legislature’s failure to specify such a scheme here means that the Legislature did not intend hearing referees or the wcab to address themselves to retaliation claims. Finally, defendant argues that § 841(1) does not mandate a different result, because the instant case does not involve any "dispute or controversy concerning compensation or other benefits” under the act. We believe the wcab and defendant have the better argument. Even if a retaliatory discharge should be treated as a "personal injury,” benefits may be awarded only if a claimant is found to be "disabled” within the meaning of the act, i.e., has suffered a loss of wage-earning capacity. MCL 418.301(4); MSA 17.237(301X4). No such loss has been demonstrated here. The Legislature may have added § 301(11) simply to codify the holding in Sventko, supra, or to limit the scope of workers’ compensation retaliation actions. For example, in Wilson v Acacia Park Cemetery Ass’n, 162 Mich App 638, 645-646; 413 NW2d 79 (1987), this Court held that a plaintiff may not premise his right of recovery on a defendant’s alleged anticipation of future workers’ compensation claims, in part because of the language of §301(11). Given this plausible interpretation of the Legislature’s intent, as well as the fact that the fact-finding involved in a retaliatory discharge action would go beyond the range of the bureau’s or the wcab’s expertise, we find that plaintiff has failed to show sufficient evidence of legislative intent to create an administrative remedy for retaliatory discharge. Furthermore, the bureau and the wcab would be unable to award the equitable remedies customarily sought in a retaliatory discharge action, such as reinstatement and back pay. In the absence of an express legislative conferral of authority, an administrative agency generally lacks the powers of a court of equity. Auto-Owners Ins Co v Elchuk, 103 Mich App 542, 545-546; 303 NW2d 35 (1981). The workers’ compensation act contains no such provision, in contrast to § 65(2) of miosha which expressly provides for orders of reinstatement and back pay. While we agree with the wcab that the bureau is without jurisdiction to decide a retaliation claim, we do not agree that the bureau and the wcab had the authority to decide whether defendant Accident Fund was required to defend and indemnify defendant employer. The wcab premised its, decision on § 621(2) of the act, MCL 418.621(2); MSA 17.237(621X2), which provides for certain mandatory language in every workers’ compensation insurance policy. In particular, §621(2) requires the following to be included in every policy: Compensation, (a) That it will pay to the persons that may become entitled thereto all workmen’s compensation for which the insured employer may become liable under the provisions of the Michigan workmen’s compensation act for all compensable injuries or compensable occupational diseases happening to his employees during the life of this contract or policy; Obligations assumed, (f) That it hereby assumes all obligations imposed upon the employer by his acceptance of the Michigan workmen’s compensation act, as far as the payment of compensation, death benefits, medical surgical, hospital care or medicine and rehabilitation services is concerned. Section 621(2) also provides that the insurance policy cover "all the businesses, employees, enterprises, and activities of the employer.” Although we agree that the terms of § 621 and of the individual insurance policy in question will have to be reviewed in order to determine whether a workers’ compensation insurer is obliged to defend and indemnify an insured in a retaliation action, neither § 621 nor the individual insurance policy confers jurisdiction or authority on the bureau or the wcab to perform this review. Certainly, pursuant to §841(1), the bureau and the wcab may decide insurance coverage questions in cases where jurisdiction of the claimant’s petition for compensation has been properly taken. See, e.g., Michigan Property & Casualty Guaranty Ass’n v Checker Cab Co, 138 Mich App 180; 360 NW2d 168 (1984), and St Paul Fire & Marine Ins Co v Littky, 60 Mich App 375; 230 NW2d 440 (1975). However, we believe it is inappropriate for the wcab to decide the coverage question when jurisdiction over the substantive question of liability is in a court of general jurisdiction. Principles of judicial and administrative economy lead to the conclusion that the issues be resolved in a single forum. Affirmed in part and reversed in part.

Defendant Win
Stefanac v. Cranbrook Educational Community
8790Jul 5, 1990Michigan

STEFANAC v CRANBROOK EDUCATIONAL COMMUNITY (AFTER REMAND) Docket No. 82317. Argued March 8, 1989 (Calendar No. 7). Decided July 5, 1990. Judith Stefanac brought an action in the Oakland Circuit Court against Cranbrook Educational Community, alleging wrongful discharge, sex discrimination, and termination of employment in violation of public policy. The court, Robert C. Anderson, J., relying on Leahan v Stroh Brewery Co, 420 Mich 108 (1984), granted the defendant’s motion for accelerated judgment because plaintiff failed to tender consideration, and therefore the release executed by the plaintiff barred her claims. Thereafter, the plaintiff, on rehearing, sought the court’s consent to tender the disputed consideration and refile her suit. The court affirmed its previous ruling, dismissing the complaint with prejudice. The Court of Appeals, Beasley and C. L. Horn, JJ. (Bronson, P.J., not participating), affirmed in an unpublished opinion per curiam (Docket No. 89512). The Supreme Court vacated the judgment of the Court of Appeals and remanded the case for consideration of plaintiff’s alternate argument whether her offer to tender the disputed consideration was made within a reasonable time. 428 Mich 903 (1987). On remand, the Court of Appeals, Beasley, P.J., and Michael J. Kelly and Maher, JJ., held that the offer to tender the disputed consideration had been made within a reasonable time and instructed the trial court to issue an order allowing the plaintiff thirty days to make restitution (Docket No. 101319). The defendant appeals. In an opinion by Justice Brickley, joined by Chief Justice Riley and Justices Cavanagh, Boyle, and Griffin, the Supreme Court held: Where a plaintiff has entered into a settlement agreement, of consideration recited in the agreement must occur not only within a reasonable time after execution of the agreement, but, in all cases, prior to or simultaneously with the commencement of any proceeding raising a legal claim in contravention of the agreement. References Am Jur 2d, Compromise and Settlement §§ 7, 8,13. Timeliness of tender or offer of return of consideration for release or compromise, required as condition of setting it aside. 53 ALR2d 757. 1. Settlement agreements are binding until rescinded for cause. Tender of consideration received is a condition precedent to the right to repudiate a contract of settlement. The law favors settlements, and a party entering into a settlement agreement, offering adequate consideration, is entitled to rely on the terms of the agreement. A compromise and release should not be confused with the law of contract. The very essence of a release is to avoid litigation, even at the expense of strict right. One who seeks to repudiate or avoid a compromise settlement or release and revert to the original right of action must place the other party in statu quo, absent waiver or fraud in the execution. In this case, the plaintiff’s allegations of fraud are insufficient to bring the claim within the exception, and the defendant has not waived the obligation to tender. The plaintiff made no effort to raise the validity of the release; rather, she merely ignored the existence and terms of the agreement and brought an action in contravention of it, while retaining its benefits. 2. A plaintiff must tender restitution promptly and without unreasonable delay upon discovery of fraud or be held to have ratified the release. Long acquiescence and failure to complain promptly operates, as a matter of law, to reaffirm a contract of settlement and bars litigation. A settlement agreement is binding until rescission by repudiation and tender. Tender is a prerequisite to the right to repudiate. Commencement of a lawsuit is not a proper means to repudiate a settlement. Tender must occur within a reasonable time after learning of the grounds upon which the release and settlement could be repudiated. What is reasonable under the circumstances is a matter of discretion for the trial court. In this case, the trial court had no occasion to rule on the issue because, instead of repudiating the agreement, the plaintiff filed suit in contravention of the terms of the release. 3. Independent of the issue what constitutes a reasonable time within which to repudiate a settlement is the question whether tender is permissible after commencement of an action in contravention of the agreement. As a matter of law, in all cases where a legal claim is raised in contravention of an agreement, the plaintiff must tender the consideration recited in the agreement prior to or simultaneously with filing suit. A defendant is entitled to rely on the binding nature of an agreement. A plaintiff is not entitled to retain the benefit of an agreement and at the same time bring suit in contravention of the agreement. Reversed. Justice Levin, dissenting, stated that where a plaintiff claims, and the court finds, that there would be entitlement to retain recited consideration after a release is set aside because the amount recited as consideration represents payment that accrued and was owing to the plaintiff separate and apart from the claims that were settled by the release, and that no consideration in fact was paid to settle those claims, tender is not required. In deciding whether tender is required before suit in this case the Supreme Court is obliged to accept as true the allegations in the plaintiff’s complaint and in her response to the motion for summary disposition, and to proceed on the assumptions, absent judicial determination at the trial level to the contrary, both that the release in fact was obtained by fraud or duress and that the defendant indeed owes the plaintiff two weeks’ vacation pay and thus an amount equal to the consideration recited in the release. In addition, it exalts form over substance to require tender before suit where it is apparent that the defendant would not have accepted the tender had it been promptly offered. A person who has signed a release should not be permitted to proceed in an action in disaffirmance of the release until the consideration actually paid for the release itself has been returned. The purpose of the tender rule is not to provide a fair and necessary check against the instability of contracts, but rather to provide a check against the unjust enrichment of the rescinding party that would result if the rescinding party were allowed to retain the benefits of the contract attacked. The factual dispute in an action to set aside a release does not involve the merits of the plaintiff’s underlying claim against the defendant that were resolved by the release if it is valid. It is only if and when the release is set aside that the plaintiff should be able to put the defendant to the expense of defending against the underlying claim. The consideration paid by the defendant to the plaintiff at the time the release is signed does not provide protection against a claim that the release itself was procured by fraud or duress, or protect the very instrument that is intended to ensure forbearance of litigation. If it is judicially determined in this case that the plaintiff was coerced into signing the release, the release should be set aside and she should be required to return the payment before obtaining a determination on the merits of her claims of wrongful discharge unless it is also so judicially determined that the defendant owes her that amount as additional vacation pay. The majority’s reading of Leahan is incorrect and contradicts a well-established tenet of the law of contracts. Parol evidence is always admissible to show that a statement in a document is not true. Tender of consideration, although a precondition to an action at law, is not a precondition to commencement of an action seeking equitable relief. The majority errs in concluding that the abolition of the procedural distinction between law and equity in some way diminishes the power of a court to order rescission in accordance with the rules and practices developed in equity. Modem procedural reforms, in conjunction with the consolidation in one court of jurisdiction of both equitable and legal claims, eliminate the necessity of tender as a prerequisite to commencement of an action seeking to obtain rescission. Under unified proceedings, a court may enter a judgment conditioning rescission on the return of consideration received by the plaintiff, thus effectuating the purpose of the tender rule, the avoidance of unjust enrichment of the residing party. Contracts to relinquish the enforcement of legal rights warrant at least as much judicial surveillance as other contracts. Justice Archer, dissenting, stated that an inflexible application in this case of the rule of Leahan that a party to a contract of settlement must tender any consideration received as a condition precedent to repudiating the contract is neither complete nor fair. Where there is a bona fide, good-faith dispute regarding whether consideration recited in a release agreement actually amounted to consideration, the rule of Leahan is unworkable. Where, aside from the transaction, the person seeking restitution would be entitled to retain what the other gave as a result of the agreement, there is no enrichment as a result of the agreement even though what was given is retained, nor does it diminish the net assets of the other. Clearly, a plaintiff who contests the sufficiency of the consideration supporting a release agreement should be allowed to withhold tender of the alleged consideration until there is a judicial determination that consideration was in fact paid. If it is found that the consideration was paid, the plaintiff should be required to tender that amount. However, if the court determines that the amount paid to the plaintiff for the release was already owed to the plaintiff, the plaintiff should be allowed to retain that amount and proceed with any legal action. In this case, the plaintiff unquestionably was owed her wages find accrued vacation pay. A question of fact exists regarding whether additional vacation pay was owed, and any amount determined to be in excess of that owed the plaintiff should be tendered to the defendant within a reasonable time following resolution. However, the plaintiff should be allowed to amend her complaint to request rescission. 164 Mich App 709; 417 NW2d 582 (1987) reversed. Compromise and Settlement — Release — Consideration — Tender — Reasonable Time. Where a plaintiff has entered into a settlement agreement, tender of consideration recited in the agreement must occur not only within a reasonable time after execution of the agreement, but, in all cases, prior to or simultaneously with the commencement of any proceeding raising a legal claim in contravention of the agreement. Bell & Gardner, P.C. (by Mary E. Rosick and Cynthia Yott), for the plaintiff. Dickinson, Wright, Moon, Van Dusen & Freeman (by John Corbett O’Meara, Thomas G. Kienbaum, and Elizabeth Hardy) for the defendant. AFTER REMAND Brickley, J. The issues presented in this case are whether a plaintiff, before commencing a suit which disregards the terms of a release, must tender the consideration recited in the release and, if so, at what point before or during the proceedings must this tender take place. We hold that when a plaintiff has entered into a settlement agreement tender of consideration recited in the agreement must occur not only -within a reasonable time after execution of the agreement, but in all cases prior to or simultaneously with the commencement of any proceeding raising a legal claim in contravention of the agreement. i On November 16, 1983, plaintiff resigned as personnel director of Cranbrook Educational Community. In connection with her termination, plaintiff signed a document entitled "Release of Claims.” The release is dated November 16, 1983, and reads in pertinent part as follows: For and in consideration of Cranbrook Educational Community’s (Cranbrook) acceptance of the voluntary resignation of Judith Stefanac (Stefanac) and Cranbrook’s further agreement to pay Stefanac for two weeks, less applicable state and federal withholding taxes, Stefanac, for herself, her heirs, administrators and executors, does hereby fully and forever release, acquit and discharge Cranbrook, its agents, servants and representatives, of and from any and all claims, demands, actions and causes of action of every kind, nature and description which Stefanac may have had, may now have or may hereafter have by reason of any matter, cause, act or omission arising out of or in connection with Stefanac’s employment with and/or resignation from Cranbrook. After signing the release plaintiff received a check from defendant for $2,090.65. The check was purportedly intended to be payment for four weeks accrued vacation time and two weeks’ severance pay. Plaintiff filed suit against Cranbrook on August 9, 1984, alleging wrongful discharge, sex discrimination, and termination in violation of public policy. Subsequently, defendant filed a motion for accelerated judgment, arguing that the release barred plaintiff’s claims. In response, plaintiff filed an affidavit challenging the validity of the release. The parties agreed that plaintiff's affidavit raised a question of fact, and therefore the motion was denied without prejudice. Following a discovery period of one year, defendant again moved for dismissal of the action on the grounds that the release barred suit. Defendant also argued at this point, that plaintiff’s failure to tender the consideration received in exchange for the release prevented her from now attempting to rescind the agreement. Defendant’s position was based on this Court’s decision in Leahan v Stroh Brewery Co, 420 Mich 108; 359 NW2d 524 (1984). Plaintiff conceded that Leahan merely reaffirmed the law as it had existed in the past, but asserted that the facts of Leahan differed from the instant case. Further, plaintiff maintained that the release was void for lack of consideration and that she was entitled to all money received as a result of her termination. The trial court interpreted Leahan as dispositive of the issue and granted defendant’s motion. Three weeks later, plaintiff filed a motion for rehearing. On rehearing, plaintiff sought the trial court’s consent to tender the disputed consideration and, following tender of the money, the opportunity to refile her suit against defendant. This is the first indication that plaintiff was willing to repay the consideration recited in the release. The trial judge affirmed the previous ruling, dismissing plaintiff’s complaint with prejudice. Plaintiff appealed as of right, raising two issues. Plaintiff continued to argue that she was entitled to all the money received and therefore that tender was not required in order to maintain the action. Alternatively, plaintiff argued that her offer to tender back the disputed consideration was within a reasonable time under the circumstances of the case. Basing its analysis on an examination of Leahan, the Court of Appeals held: [T]he consequence of the Leahan decision is that if a release recites that consideration was paid and if money was in fact paid, a plaintiff may not argue that the money was not actually consideration, regardless of any evidence to that effect. That seems to be what Leahan holds. If not, we believe it is up to the Supreme Court to say so. Consequently, we affirm.[] [Emphasis added.] However, the Court of Appeals did not directly address plaintiff’s alternate argument that tender of the disputed consideration occurred within a reasonable time. Consequently, we issued an order vacating the judgment of the Court of Appeals and remanded the case for consideration of the second issue raised by plaintiff. 428 Mich 903 (1987). On remand, the Court of Appeals ruled that “plaintiff’s offer to tender back the disputed consideration was within a reasonable time.” The Court instructed the trial judge to issue an order which would allow plaintiff thirty days to make restitution to the defendant. Further, the trial court held: If such restitution is made, trial shall be had on the merits, including determination of the validity of the release. If such restitution is not made, judgment may enter for defendant. Nothing in this opinion is intended to preclude the trial judge from making appropriate findings of fact after trial, including resolution of how much, if any, of the monies paid plaintiff were in consideration of the release.[] We granted defendant’s application for leave to appeal. 430 Mich 892 (1988). ii It is a well-settled principle of Michigan law that settlement agreements are binding until rescinded for cause. Further, tender of consideration received is a condition precedent to the right to repudiate a contract of settlement. See, generally, Randall v Port Huron, St C & M C R Co, 215 Mich 413; 184 NW 435 (1921); Kirl v Zinner, 274 Mich 331; 264 NW 391 (1936); Leahan v Stroh Brewery Co, supra. The policy consideration underlying the general rule is that the law favors settlements. A party entering into a settlement agreement, offering adequate consideration, is entitled to rely on the terms of the agreement. The rationale for the rule was explained further by this Court in Kirl v Zinner:___ A compromise and release is not to be confused with the law of contract, in which equivalents are exchanged, for the very essence of a release is to avoid litigation, even at the expense of strict right. * * * It is a general and salutary rule that one repudiating or seeking to avoid a compromise settlement or release, and thereby revert to the original right of action, must place the other party in statu quo, otherwise the very fact of payment, in consideration of the compromise or release, will likely operate as a confession of liability. [274 Mich 334-335. Emphasis in original.] Plaintiff asserts that she should be excepted from this rule because the release was void and not merely voidable. The validity of the release was challenged by plaintiff on the grounds that it lacked consideration and was procured under duress and fraud. Specifically plaintiff asserts that defendant misrepresented the terms of the agreement. Moreover she asserts that defendant knew that plaintiff was legally entitled to the money she received, that she needed the money to support her family, and that defendant waved the checks at her refusing to give plaintiff any funds unless she signed the release. Plaintiff contends that although the release recites that consideration was received, she in fact did not get anything in exchange for signing the settlement agreement. Therefore tender was not necessary prior to filing suit because "there is nothing to be returned to restore the status quo ante.” However, plaintiff admits that she signed the release and that she received four checks. Subsequently she endorsed and cashed the checks received. We start with the presumption that the plaintiff executed the release knowingly and that the recited consideration was received. Porth v Cadillac Motor Car Co, 198 Mich 501; 165 NW 698 (1917). Kirl v Zinner, supra. The plaintiff has the burden of showing, by a preponderance of the evidence, that the release is unfair or incorrect on its face. Id. Even in light of these presumptions and the plaintiff’s burden, the plaintiff must tender the recited consideration before there is a right to repudiate the release. Id. The only recognized exceptions in Michigan are a waiver of the plaintiff’s duty by the defendant and fraud in the execution. Plaintiff has not raised either exception and thus is not relieved of the duty to tender the consideration recited in the release. Our reports are replete with authority that negate plaintiff’s contentions. In Niederhauser v Detroit Citizens’ St R Co, 131 Mich 550, 552; 91 NW 1028 (1902), we held: The law is well settled that, if one seeks to rescind a settlement on the

Defendant Win
Carlson v. Hutzel Corp.
8979May 7, 1990Michigan

CARLSON v HUTZEL CORPORATION OF MICHIGAN Docket No. 102776. Submitted February 5, 1990, at Detroit. Decided May 7, 1990. Patricia Carlson and other nonunion nursing administrators for Hutzel Corporation of Michigan doing business as Hutzel Hospital brought an action against the hospital in the Wayne Circuit Court, alleging constructive discharge from employment in breach of their just-cause employment contracts and in violation of public policy. Defendant hospital laid off several unionized licensed practical nurses and reassigned plaintiffs, who were registered nurses, to jobs of performing or supervising patient care. Plaintiffs resigned rather than accept reassignment. Following the presentation of plaintiffs’ case, the court dismissed the claim of violation of public policy. The jury returned a verdict for plaintiffs and the court, Charles S. Farmer, J., entered a judgment for plaintiffs. Defendant appealed and plaintiffs cross appealed the dismissal of their public policy claim. The Court of Appeals held: 1. Plaintiffs’ claims are not preempted by the National Labor Relations Act. 2. Defendant’s unilateral change of a written policy statement to provide for binding arbitration in cases of disputes over discharge of employees was effective upon notice to employees and did not require the assent of the employees to become part of the employment contract. Thus, plaintiffs should have submitted their claims to arbitration. Reversed. 1. Conflict of Laws — Preemption — Labor Relations. State law is not preempted by the National Labor Relations Act where the conduct at issue is of only peripheral concern to the federal law or touches interests deeply rooted in local feeling and responsibility; in determining whether state law is preempted by the National Labor Relations Act, the court should balance the state’s interest in regulating or promoting a remedy for the conduct against the intrusion into the National Labor Relations Board’s jurisdiction and the risk that the state’s determination will be inconsistent with provisions of the National Labor Relations Act. References Am Jur 2d, Labor and Labor Relations §§ 922, 940, 1727, 1830, 1894-1896, 2003. See the Index to Annotations under Arbitration and Award; Discharge from Employment or Office; Labor and Employment; Preemption. 2. Labor Relations — Policy Statements — Unilateral Changes. Where policy statements by an employer give rise to enforceable contract' rights of employees without mutual consent, an employer may unilaterally change his policy and it will be effective upon notice to the employees. Mueckenheim & Mueckenheim, P.C. (by Robert C. Mueckenheim), for plaintiffs. Dykema Gossett (by Charles C. DeWitt, Terrence E. Haggerty and Susan E. Mason), for defendant. Before: Sullivan, P.J., and Doctoroff and J. W. Fitzgerald, JJ. Former Supreme Court justice, sitting on the Court of Appeals by assignment. Sullivan, P.J. This is a wrongful discharge case. Plaintiffs were nonunion nursing administrators at defendant Hutzel Hospital. The only claims pertinent to this appeal are plaintiffs’ claims that defendant constructively discharged them in breach of their alleged just-cause employment contracts and in violation of public policy. Only the former claim was submitted to the jury, which returned verdicts in favor of plaintiffs. The latter claim was dismissed by the trial court on defendant’s motion for a directed verdict following plaintiffs’ case in chief. Defendant now appeals, raising several issues. We reverse the jury verdicts because we conclude that the grievance and arbitration procedure was a part of plaintiffs’ employment contract and, as such, was plaintiffs’ sole remedy. Because of our resolution of that issue, we need not reach plaintiffs’ issues on cross appeal. Defendant hospital was experiencing severe financial problems in 1983. To help alleviate these problems to some extent, Frank Iacobell, president and chief executive officer at defendant hospital, devised a plan whereby several unionized licensed practical nurses would be laid off. In turn, the nursing administrators and educators who were registered nurses, including plaintiffs, would be assigned to work on hospital floors either caring for patients or overseeing patient care. Plaintiffs resigned rather than implement what they believed to be Iacobell’s plan because they did not feel competent to care for patients. i The first issue raised by defendant is whether plaintiffs’ claims are preempted by the National Labor Relations Act, 29 USC 151 et seq. We conclude that they are not. Defendant argues that plaintiffs’ claims are preempted because they concern an activity that is actually or arguably protected or prohibited by the nlra. San Diego Building Trades Council v Garmon, 359 US 236, 245; 79 S Ct 773; 3 L Ed 2d 775 (1959). However, if the conduct at issue "is of only peripheral concern to the federal law or touches interests deeply rooted in local feeling and responsibility,” Belknap, Inc v Hale, 463 US 491, 498; 103 S Ct 3172; 77 L Ed 2d 798 (1983), then the state law claims survive. See also 359 US 243-244. "The court balances the state’s interest in regulating or promoting a remedy for the conduct against the intrusion in the nlrb’s jurisdiction and the risk that the state’s determination will be inconsistent with provisions of the nlra.” Bullock v Automobile Club of Michigan, 432 Mich 472, 493; 444 NW2d 114 (1989), reh den 433 Mich 1201 (1989). Moreover, in Sears, Roebuck & Co v Carpenters, 436 US 180, 197; 98 S Ct 1745; 56 L Ed 2d 209 (1978), the United States Supreme Court announced the following focus for a preemption analysis: The critical inquiry, therefore, is not whether the State is enforcing a law relating specifically to labor relations or one of general application but whether the controversy presented to the state court is identical to ... or different from . . . that which could have been, but was not, presented to the Labor Board. For it is only in the former situation that a state court’s exercise of jurisdiction necessarily involves a risk of interference with the unfair labor practice jurisdiction of the Board which the arguably prohibited branch of the Garmon doctrine was designed to avoid. Here, even though defendant’s conduct is arguably prohibited by the nlra, it nevertheless can be challenged in state court to the extent that it forms the basis of plaintiffs’ claims. Plaintiffs’ breach of contract claim involves a significant state interest because this state has a substantial interest in adjudicating contractual disputes arising within its jurisdiction. See Belknap, 463 US 511-512, and Roberts v Automobile Club of Michigan, 138 Mich App 488, 497; 360 NW2d 224 (1984), lv den 424 Mich 867 (1986), cert den sub nom Automobile Club of Michigan v Roberts, 479 US 889; 107 S Ct 289; 93 L Ed 2d 263 (1986). Furthermore, because plaintiffs’ public policy claim alleges that defendant’s conduct violated Michigan public policy and threatened the health, safety and welfare of patients at defendant hospital, that claim also concerns a significant state interest. On the other side of the scale, we note that exercise of this state’s jurisdiction would not interfere with the jurisdiction of the nlrb. We so conclude because the controversy presented to the state court was different from that which might have been, but was not, presented to the nlrb. Plaintiffs’ breach of contract claim required the jury to determine whether plaintiffs’ employment contract with defendant provided that they could be discharged only for just cause, whether defendant had just cause to discharge plaintiffs and whether defendant made plaintiffs’ working conditions so intolerable that they justifiably resigned. See, e.g., Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), reh den 409 Mich 1101 (1980), and Jenkins v Southeastern Michigan Chapter, American Red Cross, 141 Mich App 785, 796; 369 NW2d 223 (1985). Plaintiffs’ public policy claim, had it gone to the jury, would have required the jury to determine whether defendant’s conduct violated the public policy of this state. On the other hand, the controversy which could have been presented to the nlrb under the nlra would have required the nlrb to determine whether the act of replacing laid-off union employees with their nonunion supervisors was an unfair labor practice. In other words, the issue in the state law controversy was not whether defendant’s conduct was an unfair labor practice, the unfair labor practice having to do with the fact that the laid-off lpns were unionized but, rather, was whether defendant’s conduct violated an alleged employment contract or public policy, which issue is unrelated to the fact that the lpns were unionized. Therefore, we conclude, plaintiffs’ claims were not preempted by federal law. n The second issue defendant raises on appeal is whether an employer can unilaterally change a written policy statement to provide for a binding arbitration procedure without having first obtained the consent of the existing employees to whom the procedure applies. We answer in the affirmative. Therefore, plaintiffs’ wrongful discharge claims were barred because plaintiffs failed to use the arbitration procedure. The trial court thus erred by failing to grant defendant’s motion for accelerated judgment on this basis. (Prior to trial, defendant had moved for accelerated judgment under GCR 1963,116.1[2].) In Toussaint, supra, our Supreme Court held 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.” Id., p 610. See also id., pp 598-599, 613, 614-615, 618-619, 620-621. Although those rights are enforceable in contract, they do not necessarily arise under general contract principles. As the Toussaint Court explained, once an employer establishes personnel policies or procedures and makes them known to employees, the employment relationship is presumably enhanced. Preemployment negotiations need not take place. Nor do the parties’ minds have to meet on the subject. It is enough that the employer opted to create an environment in which the employee believes that the personnel policies and practices, whatever they may be, are "established and official at any given time, purport to be fair, and are applied consistently and uniformly to each employee. The employer has then created a situation 'instinct with an obligation.’ ” Toussaint, supra, p 613. The policy statements can give rise to contractual rights even though the parties did not mutually agree that the policy statements would create contractual rights in the employee. Toussaint, supra, pp 613-615. Moreover, our Supreme Court recently held that, when contract rights have arisen outside the operation of normal contract principles, the application of strict rules of contractual modification may not be appropriate. In re Certified Question, 432 Mich 438, 447-448; 443 NW2d 112 (1989). In In re Certified Question, the plaintiff argued that the employer’s attempt to change an existing discharge-for-cause policy to an at-will policy was no more than a proposal for modification of the contract for which mutual assent was required. Our Supreme Court rejected this argument because the contractual obligation which the plaintiff argued may not be modified without mutual assent could have arisen without mutual assent under a Toussaint theory. Under Toussaint, written policies are enforceable because of the benefit the employer derives by establishing such policies. When the employer changes its discharge-for-cause policy to one of employment at will, the employer’s benefit is correspondingly extinguished, as is the rationale for the court’s enforcement of the discharge-for-cause policy. In re Certified Question, supra, pp 447, 453-454. Therefore, the In re Certified Question Court held, an employer can unilaterally change a written discharge-for-cause policy to one of termination at will, provided the employer gives affected employees reasonable notice of the policy change. Id., p 441. An employer can provide a procedure for resolution of disputes concerning the discharge of employees. Toussaint, supra, p 624; Dahlman v Oakland University, 172 Mich App 502, 505; 432 NW2d 304 (1988), lv den 431 Mich 911 (1988). Defendant herein provided for such a procedure by way of a written supplement amending the previously issued employee manual. This procedure was a part of the employment contract of employees hired after the effective date of the procedure by virtue of the fact that it was included in the employee manual. Mutual assent was not necessary. See, e.g., Dahlman, supra, p 505, and Vander Toorn v Grand Rapids, 132 Mich App 590, 598; 348 NW2d 697 (1984), lv den 424 Mich 886 (1986). Under the reasoning of In re Certiñed Question, it also became a term of employment of existing employees as soon as they received notice of the change. Mutual assent was not required. Therefore, the trial court erred by failing to grant defendant’s motion for accelerated judgment. We therefore reverse the jury verdicts which were rendered in favor of plaintiffs. Reversed._ The evidence presented at trial with regard to what Iacobell’s plan actually was and the reason plaintiffs resigned was conflicting. However, for the purpose of the issues we address on appeal, it is not necessary to note and explain the conflicts. Our brief statement of facts is suiflcient. We agree with the trial court that the arbitration procedure was mandatory notwithstanding the fact that the court ultimately sent the issue to the jury and the jury found that the plaintiffs did not have to follow the procedure.

Defendant Win
Equal Employment Opportunity Commission v. Arlington Transit Mix Inc.
E.D. Mich.Apr 12, 1990Michigan
Plaintiff Win
Rucker v. First Union National Bank
14983Apr 3, 1990North Carolina

GENEVA N. RUCKER v. FIRST UNION NATIONAL BANK OF NORTH CAROLINA, and FIRST UNION CORPORATION No. 8921SC352 (Filed 3 April 1990) 1. Master and Servant § 10.2 (NCI3d)— discharge of employee — employment manual — not part of contract The trial court did not err by granting defendants’ motion for dismissal of plaintiffs claim for wrongful discharge where plaintiff contended that defendants’ issuance of two employee handbooks created a unilateral contract between the parties and removed plaintiff from the status of an at-will employee, but plaintiff did not receive the first of the manuals until she had worked for defendants for almost five and one-half years; plaintiff does not allege nor was there any evidence that the manuals were expressly included in any employment contract; and plaintiff did not allege that she had signed a statement that she had read the policy manual or had taken some other step which would evidence that the manuals were expressly included in her employment contract; and applying a unilateral contract analysis to the issue of wrongful discharge would in effect abandon the at-will doctrine. Am Jur 2d, Master and Servant §§ 32, 48.3. 2. Master and Servant § 10.2 (NCI3d)— wrongful discharge-misrepresentation of employment manual —not part of employment contract The trial court did not err by dismissing plaintiff’s claim for punitive damages based on alleged misrepresentation of the terms of employment manuals where the manuals were not expressly included in plaintiff’s employment contract and could not be considered part of plaintiff’s employment contract. Am Jur 2d, Master and Servant §§ 32, 48.3. 3. Master and Servant § 10.2 (NCI3d)— wrongful discharge— vacation pay The trial court erred in dismissing plaintiff’s claim for vacation pay following her dismissal where plaintiff stated a prima facie claim by alleging that she was not terminated for cause and that defendants’ employment manual entitled her to compensation for unused vacation time. Furthermore, this claim is not preempted by federal law. N.C.G.S. § 95-25.12. Am Jur 2d, Master and Servant § 80. 4. Master and Servant § 10.2 (NCI3d) — wrongful discharge — severance pay — claim preempted by ERISA A claim for severance pay was properly dismissed because the Fourth Circuit Court of Appeals has specifically held that N.C.G.S. § 95-25.7 is preempted by ERISA. Am Jur 2d, Master and Servant § 81. APPEAL by plaintiff from judgment entered 15 December 1988 by Judge Thomas W. Boss in FORSYTH County Superior Court. Heard in the Court of Appeals 17 October 1989. Plaintiff, Geneva N. Rucker, was employed by defendants, First Union National Bank and First Union Corporation (“First Union”) from 6 September 1978 until her termination on 12 June 1987. On 6 September 1988 she brought this action against her former employers for compensatory and punitive damages alleging (1) failure to pay vacation and severance pay; (2) breach of contract; (3) negligence and negligent misrepresentation; and (4) intentional and fraudulent misrepresentation. On 5 October defendants moved to dismiss all of plaintiff’s claims pursuant to G.S. sec. 1A-1, Rule 12(b)(6). On 6 December plaintiff amended her complaint to include an alternative claim for vacation and severance pay pursuant to the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. sec. 1001 et seq. After a hearing the trial court granted defendant’s motion to dismiss all of plaintiff’s claims except her claim for vacation and severance pay pursuant to ERISA. The court certified the order as a final judgment from which appeal may be taken, there being no just reason for delay. Plaintiff appealed to this Court in apt time. Morgan & Morgan, hy J. Griffin Morgan and J. Kevin Morton, and North Carolina Academy of Trial Lawyers, hy J. Wilson Parker and Deborah Leonard Parker, for plaintiff-appellant. Smith, Currie & Hancock, by J. Thomas Kilpatrick and R. Steve Ensor, and Petree Stockton and Robinson, by W. R. Loftis, Jr. and Penni P. Bradshaw, for defendant-appellees. JOHNSON, Judge. Plaintiff’s complaint alleges the following: During the years she worked for First Union, plaintiff received praise from her supervisors and was promoted to the position of teller supervisor. On 12 June 1987, she was told that she was being discharged for failing to check the night depository on 17 April 1987. Prior to the next business day following 17 April 1987, approximately $22,000 had been taken from the depository. All employees, including plaintiff, were cleared of any involvement in the theft. Plaintiff received no prior warning or disciplinary action before her termination. Also, she alleges she had never previously been told to check the night depository. Plaintiff contends that a memo circulated ten days after her dismissal made it clear that it had not been part of her duties. Plaintiff alleges that she has been unable to find similar work since her discharge, and that the termination has caused her to lose substantial income and fringe benefits and suffer extreme mental distress. In this appeal plaintiff recognizes that North Carolina adheres to the doctrine that, in the absence of an employment contract for a definite time period, both employer and employee are generally free to terminate their association at any time and without any reason. Still v. Lance, 279 N.C. 254, 182 S.E.2d 403 (1971). She admits that she was not working under an employment contract for a definite period of time, but contends that defendants’ issuance of two employee handbooks to plaintiff, one in January, 1984 and a second in March, 1987, created a unilateral contract between the parties and removed plaintiff from the status of an “at-will” employee. It is well settled in North Carolina that “unilaterally promulgated employment manuals or policies do not become part of the employment contract unless expressly included in it.” Rosby v. General Baptist State Convention, 91 N.C. App. 77, 81, 370 S.E.2d 605, 608, disc. rev. denied, 323 N.C. 626, 374 S.E.2d 590 (1988), quoting Walker v. Westinghouse Electric Corp., 77 N.C. App. 253, 259, 335 S.E.2d 79, 83-84 (1985), disc. rev. denied, 315 N.C. 597, 341 S.E.2d 39 (1986). In the case sub judice plaintiff did not receive the first of her employment manuals until she had already worked for defendants for almost five and one-half years. Plaintiff does not allege nor is there evidence that the employment manuals were expressly included in any employment contract. Therefore, the manuals may not be relied on by plaintiff as being part of, or creating, an employment contract. Id. This case is distinguishable on its facts from the situation in Trought v. Richardson, 78 N.C. App. 758, 338 S.E.2d 617, disc. rev. denied, 316 N.C. 557, 344 S.E.2d 18 (1986), in which this Court held that the discharged plaintiff-employee sufficiently alleged that a policy manual was part of her employment contract to withstand the employer’s Rule 12(b)(6) motion. In Trought the plaintiff alleged that she was required to sign a statement that she had read the employer’s policy manual when she was hired. In the instant case, plaintiff does not allege that she signed such a statement or took some other step which would be evidence that the manuals were expressly included in her employment contract. We therefore must conclude that the manuals were not part of plaintiff’s contract and she may not legally rely upon them for relief. Plaintiff argues essentially that we should not have to find that the manuals were expressly included in an employment contract because, she contends, her continued employment after distribution of the handbooks created a unilateral contract which bound defendants to the terms of the manuals. In support of this argument, she cites cases in which a unilateral contract analysis has been either implicitly or expressly recognized in North Carolina cases relating to various types of employment benefits. Morton v. Thornton, 257 N.C. 259, 125 S.E.2d 464 (1962) (unpaid wages); Roberts v. Mays Mills, 184 N.C. 406, 114 S.E.2d 530 (1922) (bonus); Welsh v. Northern Telecom, Inc., 85 N.C. App. 281, 354 S.E.2d 746, disc. rev. denied, 320 N.C. 638, 360 S.E.2d 107 (1987) (vacation and retirement benefits); Brooks v. Carolina Telephone, 56 N.C. App. 801, 290 S.E.2d 370 (1982) (severance payments). We decline to apply a unilateral contract analysis to the issue of wrongful discharge. This Court has previously distinguished between issues of benefits or compensation earned during employment and the issue of an employee entitlement to continued employment. Id. The former addresses earned benefits, while the latter concerns a future benefit not yet earned. Further, to apply a unilateral contract analysis to the situation before us would, in effect, require us to abandon the “at-will” doctrine which is the law in this State. This we cannot do. We find no error in the trial court’s granting defendants’ motion for dismissal as it concerns plaintiff’s claim for wrongful discharge. We turn now to plaintiffs appeal of the trial court’s denial of her claims for relief based on negligence, negligent misrepresentation, intentional misrepresentation, and fraudulent misrepresentation. Each of these tort claims involves allegations that defendants misrepresented the terms of the employment manuals, and that defendants failed to follow the policies set forth in the manuals. We have concluded above that the employment manuals cannot be considered part of plaintiffs employment contract since they were not expressly included in it. Walker v. Westinghouse, supra. Therefore, plaintiff cannot establish a legal claim to having been mislead based on the manuals. Id. We find no error in the dismissal of plaintiffs tort claims. Because we find plaintiff has no cognizable tort claims, we must also conclude that the trial court was correct in dismissing her claim for punitive damages. Last, we address plaintiffs argument that the trial court erred in dismissing her claims for vacation pay and severance pay pursuant to G.S. sec. 95-25.1 et seq. Plaintiff alleges in her brief that she was not discharged for cause, and that at the time of her termination she had accumulated unused vacation time under First Union’s vacation policy. Pursuant to defendants’ manual, an employee not dismissed for cause is entitled to compensation for unused vacation time. Also, G.S. sec. 95-25.12, entitled “Vacation pay,” provides that if an employer provides vacation for employees, the employer shall give all vacation time off or payment in lieu of time off in accordance with the company policy or practice. Employees shall be notified in accordance with G.S. 95-25.13 of any policy or practice which requires or results in loss or forfeiture of vacation time or pay. Employees not so notified are not subject to such loss of forfeiture. Therefore, by alleging that she was not terminated for cause and the terms of the manual concerning vacation pay, plaintiff has stated a prima facie claim for vacation pay. Further, as defendants properly concede, this claim is not preempted by federal law, the United States Supreme Court having recently held that an employer’s policy of paying discharged employees vacation pay for unused vacation time does not constitute an “employee welfare benefit plan” within the meaning of the Employment Retirement Income and Security Act of 1974 (ERISA), as amended, 29 U.S.C. sec. 1001 et seq. Massachusetts v. Morash, — U.S. —, 104 L.Ed.2d 98 (1989). We therefore reverse the trial court’s dismissal of plaintiffs statutory claim for vacation pay. The Fourth Circuit Court of Appeals has specifically held that G.S. sec. 95-25.7, which concerns severance pay, is preempted by ERISA. Holland v. Burlington Industries, Inc., 772 F.2d 1140 (4th Cir. 1985), affirmed, Brooks v. Burlington Industries, Inc., 477 U.S. 901, 91 L.Ed.2d 559 (1986). Therefore, the trial court did not err in dismissing plaintiff’s claim pursuant to G.S. sec. 95-25.7 for severance pay. In sum, we affirm the trial court’s dismissal of plaintiff’s actions for breach of contract, negligence and negligent misrepresentation, intentional and fraudulent misrepresentation, and plaintiffs state statutory claim for severance pay. We reverse the trial court’s dismissal of plaintiff’s state claim for vacation pay. Plaintiffs alternative claims for vacation and severance pay pursuant to ERISA are unaffected by this opinion and remain viable causes of action. Affirmed in part; reversed in part. Judges WELLS and ORR concur.

Mixed Result
Wilson v. General Motors Corp.
8979Apr 2, 1990Michigan

WILSON v GENERAL MOTORS CORPORATION Docket Nos. 106198, 109438. Submitted October 18, 1989, at Detroit. Decided April 2, 1990. Leave to appeal applied for. Gail L. Wilson was discharged from her employment with General Motors Corporation. Wilson brought an action for damages against General Motors in Wayne Circuit Court, alleging race and gender discrimination in violation of the provisions of the Civil Rights Act and wrongful discharge by breach of an implied contract of continued employment. The jury found that race or gender was a determining factor in defendant’s decision to discharge plaintiff, that an implied contract existed between plaintiff and defendant to the effect that defendant would only be discharged for good cause, and that plaintiff was not discharged for good cause. The jury awarded plaintiff $500,000 for lost wages and benefits and $750,000 for pain and suffering. Defendant moved for judgment notwithstanding the verdict, a new trial or remittitur. The trial court, Richard P. Hathaway, J., denied judgment notwithstanding the verdict, denied the motion for a new trial if plaintiff agreed to remittitur and reduced the award for pain and suffering to $375,000. Defendant appealed. Plaintiff cross appealed. Plaintiff moved for costs and attorney fees pursuant to the Civil Rights Act. The trial court entered an award for costs and attorney fees of $86,730.24. Defendant appealed from the award of costs and attorney fees. The Court of Appeals held: 1. The record fails to support defendant’s claim of prejudice arising out of the alleged misconduct of plaintiff’s counsel during the trial. 2. The trial court did not err in refusing to permit the testimony of a defense witness who had not been put on the witness list as required under a local court rule then in effect. References Am Jur 2d, Appeal and Error §§ 352, 355; Job Discrimination §§1985, 2502, 2503, 2511, 2515, 2520; New Trial §576; Trial §219. Recovery of damages as remedy for wrongful discrimination under state or local civil rights provisions. 85 ALR3d 351. 3. No error requiring reversal arose out of the trial court’s instructions to the jury. 4. The trial court properly allowed plaintiff and another employee of defendant to testify as to their perception of the racial overtones of statements made by a supervisor employed by defendant to plaintiff and other similarly situated employees. 5. Since there was sufficient evidence to support the jury’s determinations that there was both a civil rights violation and an implied contract of continued employment, the trial court properly denied the motion for judgment notwithstanding the verdict. 6. The trial court did not abuse its discretion by entering the award of remittitur on the pain and suffering award. 7. The jury’s award of economic damages clearly reflects inclusion of the sought, but unproved, damages for loss of life insurance and loss of cost of living. Accordingly, the $500,000 award for economic damages should be reduced to $373,578.11. 8. Since the question of entry of costs and attorney fees was not reserved in the order of judgment and the motion for such costs was made subsequent to the claim of appeal, the trial court lacked jurisdiction to amend its prior judgment by an award of costs and attorney fees. The award of costs and attorney fees is set aside without prejudice to plaintiff’s right to renew that motion in the trial court. Affirmed in part and reversed in part. Murphy, J., concurred in part with the majority, but would not have granted remittitur as to economic damages and would not have held that the use of a multiplier in the calculating of attorney fees is improper under the Civil Rights Act. 1. Appeal — Attorney Misconduct — Fair Trial. An attorney’s comments at trial will usually not be cause for reversal on appeal unless they indicate a deliberate course of conduct aimed at preventing a fair and impartial trial or where counsel’s comments were such as to deflect the jury’s attention from the issues involved and had a controlling influence upon the verdict. 2. Civil Rights — Employment Discrimination — Jury Instructions — Standard Jury Instructions. The standard jury instructions relative to employment discrimination are sufficient in themselves to inform the jury as to its duty; it is not error for a trial court to refuse to give supplemental instructions concerning employment discrimination (SJI2d 105.02-105.04). 3. Evidence — Opinion Testimony — Employment Discrimination — Race Discrimination. Minority employees testifying in an employment discrimination suit based on alleged race discrimination may give opinion testimony as to whether a supervisor’s comments to them during the course of their employment had a racial overtone since such testimony is rationally based upon the perception of the witness and would be helpful to a clear understanding of the fact at issue (MRE 701). 4. New Trial — Remittitur — Acceptance of Remittitur — Mail. Acceptance by a plaintiff of remittitur rather than a new trial, when the acceptance is done by mail, is complete at the time of mailing rather than on the date that it is received or processed by the court clerk (MCR 2.107[C][3]). 5. Appeal — Orders — Attorney Fees. A trial court is without jurisdiction to award attorney fees after a claim of appeal has been filed unless the trial court’s order granting judgment provided that the trial court would award such fees (MCR 7.208A). 6. Civil Rights — Attorney Fees — Contingency Fee Agreements. The existence of a contingent fee. arrangement does not preclude an award of attorney fees to a successful plaintiff under the Civil Rights Act; however, the existence of a contingent fee arrangement is one of the factors which a trial court should consider in determining what constitutes a reasonable fee award (MCL 37.2802; MSA 3.548[802]). 7. Civil Rights — Attorney Fees — Evidentiary Hearings. A trial court, when confronted with a challenge to the reasonableness of the attorney fees requested pursuant to the provisions of the Civil Rights Act, should conduct an evidentiary hearing at which an inquiry is made as to the actual services which were rendered and the reasonableness of the requested fees. 8. Civil Rights — Attorney Fees. It is improper for a trial court in awarding attorney fees pursuant to the Civil Rights Act to determine the award of attorney fees by multiplying the total of the actual hourly and daily rates incurred by a plaintiff’s counsel by a multiplier greater than unity without explaining why the case is so exceptional as to warrant application of a multiplier factor. Chambers, Steiner, Mazur, Ornstein & Amlin, P.C. (by Angela J. Nicita and Courtney Morgan, Jr.), for plaintiff. Bodman, Longley & Dahling (by Joseph A. Sullivan, Robert G. Brower and Martha B. Goodloe), for defendant. Before: McDonald, P.J., and Michael J. Kelly and Murphy, JJ. Michael J. Kelly, J. Defendant, General Motors Corporation, appeals from a jury verdict and award of attorney fees in favor of plaintiff, Gail Leslie Wilson. Plaintiff appeals from the circuit court’s grant of remittitur in favor of defendant. Plaintiff, a black woman, was employed by GM’s Assembly Division as a. data preparation operator from December of 1976 to October of 1981, when she was discharged. At the time of her discharge, plaintiff was on a performance improvement plan to increase her rate of production. This plan put her on six months employment probation. Plaintiff became pregnant in April or May of 1981, and this evidently caused her work quality to decline during this performance improvement period. Following her discharge, plaintiff filed suit against defendant for race and gender discrimination in violation of the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq., and for wrongful discharge under Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), reh den 409 Mich 1101 (1980). Plaintiff claimed that defendant discriminated against her on the basis of her race and gender by transferring and promoting other workers, who were white women, while refusing to transfer or promote plaintiff. Plaintiff claimed that she was fired because she confronted her supervisor regarding gm’s failure to transfer or promote black female employees and because of her pregnancy. Plaintiff’s Toussaint claim was based upon the verbal promise of one of defendant’s personnel employees at the time plaintiff was hired. Defendant denied discriminating against the plaintiff or otherwise wrongfully discharging her. It claimed that plaintiff was discharged due to her poor job performance. Following trial, the jury found that race or gender was a determining factor in defendant’s decision to discharge plaintiff. It found that a contract existed between plaintiff and defendant that defendant would fire plaintiff only for good cause and that plaintiff was not discharged for good cause. The jury awarded plaintiff $500,000 for lost wages and benefits, plus $750,000 for pain and suffering. Defendant moved for judgment notwithstanding the verdict, a new trial, and remittitur. The circuit court denied defendant’s motions for judgment notwithstanding the verdict or a new trial, but granted remittitur of the pain and suffering award to $375,000 for a total award of $875,000. Plaintiff moved for costs and attorney fees, which the court granted, in the amount of $86,730.24. i Defendant argues that the jury’s verdict must be reversed because improper conduct by plaintiff’s counsel denied defendant a fair and impartial trial. Gm claims that plaintiff’s counsel made improper inflammatory statements regarding unrelated incidents, made repeated references to matters outside the record, and made improper comments regarding defense witnesses. We find no error requiring reversal. When reviewing asserted improper conduct by a party’s lawyer, we must first determine whether the lawyer’s action was error and, if so, whether the error requires reversal. Reetz v Kinsman Marine Transit Co, 416 Mich 97, 103; 330 NW2d 638 (1982). A lawyer’s comments usually will not be cause for reversal unless they indicate a deliberate course of conduct aimed at preventing a fair and impartial trial. Guider v Smith, 157 Mich App 92, 101; 403 NW2d 505 (1987), aff'd 431 Mich 559 (1988). Reversal may also be required where counsel’s remarks were such as to deflect the jury’s attention from the issues involved and had a controlling influence upon the verdict. Id. Defendant complains about the following comments made by plaintiffs counsel during his opening statement: It [discrimination] can be a bunch of guys in white sheets standing on your front lawn burning a cross, or it could be ... . Discrimination can be brutally beating a black boy out in front of a pizza parlor in New York. It can be telling of racial jokes over a radio station, or [sic] one of the finest institutions in the country. ... It was just an analogy. Obviously it can, also, be telling someone who complains to you about why they are not being given an opportunity to advance that they are lucky to have a job, and there are plenty more where you came from. It can, also, be consistently transferring white women out of a department and leaving the black women behind. That’s in a racial situation. It can, also, be being insensitive to a woman’s needs as caused by her pregnancy, and this can be sexual discrimination. Defense counsel objected to these comments, but the circuit judge permitted them. The court did instruct the jury that the opening statements were not evidence and that anything that the attorney said was not evidence. What constitutes a fair and proper opening statement is left to the discretion of the trial court. Guider, supra, p 102. Here, plaintiffs lawyer was evidently pointing out that there are Obvious, overt forms of discrimination and subtle, less easily discerned forms of discrimination, such as in plaintiffs case. The examples cited in plaintiffs counsel’s opening statement were not related to gm and were not attacks on gm. The circuit court did not abuse its discretion by permitting these remarks. Defendant complains that plaintiffs counsel commented in closing on defendant’s failure to present the testimony of a Doctor Golusin and on defendant’s failure to present data entry operator logs which would verify defendant’s claims that plaintiff was a poor worker. In Reetz, supra, 416 Mich 109, our Supreme Court pointed out: [I]t is legitimate to point out that an opposing party failed to produce evidence that it might have, and consequently the jury may draw an inference against the opposing party. This is permissible even though the same witnesses could have been produced by both parties. These comments did not result in error. Defendant also argues that plaintiffs counsel improperly belittled defense witness Nina Shepard and James Rupkey. In closing arguments, counsel may discuss the character of a witness and characterize their testimony. DeVoe v C A Hull Inc, 169 Mich App 569, 581; 426 NW2d 709 (1988), lv den 431 Mich 862 (1988). Plaintiffs attorney’s comments did not deny defendant a fair trial and did not result in error. ii Defendant argues that the circuit court erred by excluding the testimony of a crucial defense witness. We find no error. Defendant attempted to present the testimony of Valerie Martin, a gm personnel representative, to rebut plaintiff’s evidence indicating that defendant made plaintiff, while pregnant, return to work against the advice of physicians. Defendant argued that Martin would testify that she received a report from an independent physician, Dr. Golusin, which indicated that plaintiff was free to return to work. Martin had been previously deposed by the parties but was not listed on defendant’s witness list in accordance with Wayne Circuit Court Rule 2.301. The court precluded Martin from testifying pursuant to LCR 2.301(4) on the ground that she was not listed as a witness. Wayne Circuit Court Rule 2.301(4), which was in effect at the time of the trial, provided in relevant part: An unlisted witness may not be called at the trial, except as the court orders for good cause shown or as permitted by paragraphs (5) and (6). [Emphasis added.] Under this local court rule, defendant could not present Martin as a witness unless it convinced the court of good cause. The record indicates that defendant did not show good cause for presenting Martin’s testimony regarding Dr. Golusin’s report. Martin’s deposition testimony indicated that she was not aware of the conclusions of Golusin’s report or the results of his examination of plaintiff and that Martin herself had not signed the report. Additionally, Martin’s testimony regarding the contents of Golusin’s report appears to be inadmissible hearsay under MRE 801. See Slayton v Michigan Host, Inc, 144 Mich App 535, 551; 376 NW2d 664 (1985); Carlisle v General Motors Corp, 126 Mich App 127, 129; 337 NW2d 4 (1983). The circuit court properly excluded Martin’s testimony. hi Defendant claims that reversal is required because the circuit court refused to instruct the jury regarding the authority of defendant’s employees to bind defendant to statements or promises made to plaintiff. We disagree. Plaintiff testified at trial that, at the time she was hired by gm, an employee of gm in its personnel department, Leona Zyber, told plaintiff that she would remain employed so long as she did her work and followed the rules. One of plaintiff’s witnesses also testified about similar statements made to her by employees in gm’s personnel department. These statements served as the basis for plaintiff’s Toussaint claim for breach of employment contract. Defendant did not call Zyber as a witness or present evidence regarding whether Zyber or other gm employees had actual or apparent authority to bind it with a verbal Toussainttype contract. Defendant requested the following jury instructions regarding the authority of employees to bind the employer: Plaintiff claims that one or more employees of General Motors Corporation made statements or promises to her that she would only be terminated for good cause. If you find that statements or promises were actually made by the defendants, you must then determine whether the person who made the statement or promise had the authority to bind General Motors to that statement or promise. Authority of an employee to make statements or promises which bind General Motors can be of two types: 1. Actual Authority. This type of authority exists when the employee has been expressly authorized by General Motors to make such statements or promises. 2. Apparent Authority. This type of authority exists only if the plaintiff reasonably believed that the person who made promises or statements to her was authorized by General Motors to make those statements or promises. If you find that one or more persons actually made statements or promises to the plaintiff, those statements or promises are not binding on General Motors unless you also find that the person who made the statement or promise had the actual or apparent authority to make the statement or promise. The court declined to give this instruction and instead gave the following instruction: Members of the jury, I instruct you that a corporation such as the Defendant, General Motors, in this case is operated through its employees. If you find that there was wrongdoing on the part of any employee which caused injury to Gail Wilson, then such wrongdoing would be chargeable to General Motors. Defendant argues that the court, through this instruction, improperly took from the jury the factual issue of whether its personnel employees had actual or implied authority to make contracts with plaintiff. We agree that the instruction as given was incomplete and should have applied only to plaintiff’s discrimination claims. However, any error due to this instruction is harmless and does not require reversal. An instructional error does not require reversal where it did not result in a jury verdict inconsistent with substantial justice. MCR 2.613(A); Johnson v Corbet, 423 Mich 304, 327; 377 NW2d 713 (1985); Caliesen v Grand Trunk W R Co, 175 Mich App 252, 263; 437 NW2d 372 (1989). The jury found in favor of plaintiff on bbth her claims. The jury’s verdict of liability for .race and gender discrimination alone supports the damages awarded under both claims. Additionally, we note that defendant offered no evidence to rebut plaintiff’s testimony or to establish that Leona Zyber had no authority to enter into á Toussaint-type contract with plaintiff. Our Suprerhe Court in Renda v International Union, UAW, 366 Mich 58, 94; 114 NW2d 343 (1962), stated: Where the facts are either admitted or undisputed as to the existence of the principal agent’s relationship and as to the scope of the agent’s authority, the lower court may properly instruct the jury that the principal, as a matter of law, is responsible for the acts of the agent. Gm did not present evidence disputing Zyber’s apparent authority. The circuit court’s instruction does not require reversal; IV Defendant argues that reversal is required because the circuit court refused to instruct the jury that plaintiff bore the burden of proving that she reasonably relied upon Leona Zyber’s statements. We find no error. At trial, defendant argued that, because the only basis for plaintiff’s Toussaint claim was the statements of Leona Zyber, the trial court must instruct the jury that, in order to find a valid Toussaint claim, the jury would have to find either that plaintiff was not provided with gm’s employee handbook or that the statements contained in the handbook were not inconsistent with Zyber’s statements to plaintiff. Defendant requested the following jury instruction, which the court refused to give: Statements or promises made by employees to the plaintiff can only become a part of the plaintiffs emplo

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