1996 -NMSC- 67, Rhein v. ADT Automotive, Inc., 23285

CourtSupreme Court of New Mexico
Citation1996 NMSC 66,122 N.M. 646,930 P.2d 783
Docket NumberNo. 23285,23285
Parties, 133 Lab.Cas. P 58,199, 12 IER Cases 652, 1996 -NMSC- 67 David RHEIN and Timothy Michaels, Plaintiff-Appellants, v. ADT AUTOMOTIVE, INC., d/b/a, Albuquerque Auto Auction, Defendant-Appellee.
Decision Date26 November 1996

Page 783

930 P.2d 783
122 N.M. 646, 133 Lab.Cas. P 58,199,
12 IER Cases 652,
1996 -NMSC- 67
David RHEIN and Timothy Michaels, Plaintiff-Appellants,
ADT AUTOMOTIVE, INC., d/b/a, Albuquerque Auto Auction,
No. 23285.
Supreme Court of New Mexico.
Nov. 26, 1996.

Page 784

Roehl Law Firm, P.C., Mark E. Komer, Albuquerque, for Plaintiffs-Appellants.

Law Office of Peter H. Johnstone, P.C., Peter H. Johnstone, Albuquerque, for Defendant-Appellee.


RANSOM, Justice.

1. This is a retaliatory discharge suit against ADT Automotive, Inc. David Rhein claimed that he was terminated because he alerted the New Mexico Department of Occupational Health & Safety (OSHA) about respiratory safety violations at ADT's paint and body shop, and Timothy Michaels claimed that he was terminated because he was about to file a workers' compensation claim for injuries resulting from these safety violations. 1 At trial, the jury returned verdicts for compensatory damages of $235,000 for Rhein and $75,000 for Michaels. The court had refused to instruct on punitive damages. In post-trial proceedings, the court granted ADT's motion for new trial against Rhein,

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and ADT's motion for judgment notwithstanding the verdict against Michaels. The trial court denied Plaintiffs' motion for a new trial on the issue of punitive damages.

2. Rhein and Michaels appealed to the Court of Appeals, which, in turn, certified the case to this Court pursuant to NMSA 1978, § 34-5-14(C)(2) (Repl.Pamp.1990), noting an issue of "substantial public interest" relating to the appealability of an order for new trial when a final order has been entered with respect to another party. On certification from the Court of Appeals we decide the entire case in which the appeal is taken. Collins v. Tabet, 111 N.M. 391, 404 n. 10, 806 P.2d 40, 53 n. 10 (1991). We hold that the grant of a new trial is not appealable except when this Court issues a writ of superintending control under circumstances calling for extraordinary relief. We also hold that the trial court erred in refusing to instruct on punitive damages and in granting the motions for new trial and for a judgment notwithstanding the verdict.

3. Facts and proceedings. ADT operates a large automotive reconditioning facility. Almost 30,000 cars annually pass through the Albuquerque facility, the majority of these vehicles being "program" cars that automotive manufacturers had previously leased to rental car companies. At the end of the lease term, these cars are brought to ADT by rail and, after reconditioning, are sold in auctions to retail dealers. A second shift at the body shop was created to meet increased business demands. Rhein was hired in late 1990 to work as a body man to prepare collision damaged vehicles for repainting. Michaels was hired several months later as an automotive painter. Both men were hired to work on the second shift, and both remained on this shift for the entirety of their employment at ADT. The evidence supports the following facts and inferences relevant to this appeal.

4. The ADT facility had two painting booths equipped with ventilation systems necessary to keep dangerous toxic "overspray" out of the body shop. Due to a backlog of vehicles, however, ADT management instructed employees to apply paint outside of these controlled areas. The resulting fog from these operations was often so thick that "you could not see across the room" and fresh air respirators were required to protect against the toxins. ADT did provide charcoal mask respirators, but these are not suitable to prevent exposure to the automotive paints being used.

5. Michaels alerted ADT to the health and safety risks posed by the overspray, as well as other safety violations. ADT failed to act on these complaints. Soon afterward, both Rhein and Michaels began to suffer from health problems allegedly related to exposure to airborne toxins. Rhein began to suffer upper respiratory problems and skin rashes, and believed that he was developing both liver problems and toxic hepatitis as a result of his exposure. Michaels' reaction to the toxins was even more severe. He began to lose his hair, run high fevers, and developed a kidney condition. After working his twelve hour shift his face would swell and his skin would crack and bleed.

6. Rhein also took several steps to bring these health and safety problems to the attention of ADT. He met with the personnel director and explained his concerns. He also showed the director a note from his physician regarding toxic hepatitis. The personnel director took Rhein to the general manager, Ken Osborn. Rhein explained his concerns again to Osborn, but Osborn apparently did not seem interested. Later that day Rhein telephoned the New Mexico office of OSHA. Rhein spoke to an OSHA representative about the health risks posed by the current operation of the body shop, and he then mailed in a written complaint. OSHA records indicate that the complaint against ADT was initiated on February 18, 1992.

7. A site inspection of the repair shop was made by OSHA on March 9, 1992. Both Danny Valdez, the reconditioning department manager prior to May 18, 1992, and Les Newman, who was the body shop manager until he replaced Valdez as department manager after May 18, may have seen Rhein's name on a written complaint in the briefcase of the OSHA inspector. ADT, however, denies having any knowledge of which employee had filed the complaint with OSHA. Rhein nonetheless began receiving threats of

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termination almost immediately after the OSHA inspection. Newman told Rhein on several occasions that upper management wanted him "out of there," and that Rhein should "keep [his] mouth shut and just do [his] work." Also, Valdez accused Rhein of stealing tools from ADT, an offense that would warrant termination.

8. OSHA returned to ADT on May 5, 1992, and issued several health and safety citations. In response, ADT proposed several new policies for the body shop. One of the policy changes was to prohibit the spraying of paint or primer in the body shop, limiting spraying to the controlled spray booths. This policy was not only unenforced, but management quickly ordered the body shop employees to spray paint and primer in the body shop to keep up with the workload. Another proposed policy change was an order that all body shop employees take a physical examination by a physician. All employees that failed this examination were to be terminated by ADT. Michaels believed that through this policy he was being singled out for termination. He contacted OSHA about the apparent retaliation against him for his health problems. Rhein also called OSHA to report his fears of retaliatory termination.

9. Rhein and Michaels both were terminated on May 18, 1992. Witnesses for ADT testified that both men were laid off because the second shift of the body shop was being phased out, either through lay-offs or attrition. ADT was experiencing a downturn in business, and this eliminated the need of the second shift. ADT contends that the decision to eliminate the second shift was made at a management meeting on May 18, and the employees were then informed at a general employee meeting later in the morning. Rhein testified to the contrary that Newman told him that he was being laid off because he had gone back to school, because he had refused to do "priming work," and because of his health problems. Michaels was not present for the employee meeting, but arrived later in the day with a note from his physician recommending that he avoid work in the body shop for a period of thirty days. Newman informed Michaels that he had been laid off and recommended that he file for unemployment instead of workers' compensation. Michaels insisted on filing for workers' compensation, and the personnel director assisted him with the paperwork for this claim.

10. It is the policy of ADT to rehire laid-off employees when positions become available. Michaels never was contacted by ADT even though positions became available. ADT contended that this is because they had received medical reports indicating that Michaels could not return to a work environment where he was exposed to automotive paint. Rhein was offered a position by ADT as a "color sander buffer" approximately six months after he was laid off. Rhein refused this position because it offered less pay and prestige than his former position. The position that Rhein had held, that of a body man, did open up a few weeks after this, and the position was filled by the employee that had accepted the position as color sander buffer.

11. At the end of the five-day trial, plaintiffs submitted a jury instruction for punitive damages. The trial court refused to give this instruction, and instructed on compensatory damages alone. After deliberating for eight hours the jury returned their compensatory damages verdicts of $235,000 for Rhein and of $75,000 for Michaels. The court heard several post-trial motions and granted ADT judgment notwithstanding the verdict against Michaels and a new trial against Rhein. The court denied Plaintiffs' motion for a new trial based on failure to instruct the jury on punitive damages. In a written decision, the court explained in detail its reasons for granting or denying the motions. Michaels appealed this decision. Rhein was aware that Rule 12-201(D) NMRA 1996 prohibits the immediate appeal of an order granting a new trial, and he filed a petition before this Court for a writ of superintending control allowing an immediate appeal to the Court of Appeals. We granted this extraordinary relief because the issues in Rhein's case "are similar and mutually involved with those of the Michaels appeal." Plaintiffs' appeals were consolidated, and the Court of Appeals then certified the appeal to this Court.

12. The new trial.--Immediate appealability. In light of our writ of superintending

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