Hayes v. Eateries, Inc.

• Decision Date: 17 October 1995
• Docket Number: 78,761,Nos. 78,415,s. 78,415
• Citation: 1995 OK 108,905 P.2d 778
• Parties: 131 Lab.Cas. P 58,011, 11 IER Cases 110, 1995 OK 108 John M. HAYES, Appellant, v. EATERIES, INC., an Oklahoma corporation, d/b/a Garfield's, Appellee.
• Court: Oklahoma Supreme Court

Page 778

905 P.2d 778

131 Lab.Cas. P 58,011, 11 IER Cases 110,

1995 OK 108

John M. HAYES, Appellant, v. EATERIES, INC., an Oklahoma corporation, d/b/a Garfield's, Appellee.

Nos. 78,415, 78,761.

Supreme Court of Oklahoma.

Oct. 17, 1995.

Certiorari to the Court of Appeals, Division 1 Appeal from the District Court of Payne County; Charles H. Headrick, Trial Judge.

Jan Preece Gaddis, Oklahoma City, for Appellant.

Jim T. Priest, Debra B. Cannon, McKinney, Stringer & Webster, P.C., Oklahoma City, for Appellee.

LAVENDER, Justice.

This case has its genesis in the discharge of appellant, John M. Hayes from his employment as an assistant manager at a Garfield's restaurant. We decide whether the trial court correctly granted the motion to dismiss of the employer, appellee, Eateries, Inc., d/b/a Garfield's, for failure of Hayes to state a claim against it upon which relief could be granted, made pursuant to 12 O.S.1991, § 2012(B)(6). We hold Hayes' petition was insufficient to state a claim to continued employment under either an express or implied contract theory, and it was insufficient to state a claim for the public policy tort exception to the employment-at-will doctrine. Accordingly, we affirm the trial court's dismissal.

I. STANDARD FOR REVIEWING MOTION TO DISMISS.

Review of a trial court's dismissal for failure to state a claim upon which relief can be granted is de novo and involves consideration of whether a plaintiff's petition is legally sufficient. Gay v. Akin, 766 P.2d 985, 989 f.n. 13 (Okla.1988). When reviewing such a dismissal an appellate court must take as true all of the challenged pleading's allegations together with all reasonable inferences which may be drawn from them. Great Plains Federal Savings and Loan Association v. Dabney, 846 P.2d 1088, 1090 f.n. 3 (Okla.1993). "A pleading must not be dismissed for failure to state a legally cognizable claim unless the allegations indicate beyond any doubt that the litigant can prove no set of facts which would entitle him to relief." Frazier v. Bryan Memorial Hospital Authority, 775 P.2d 281, 287 (Okla.1989) (emphasis in original). The above standards guide our review in this case.

II. FACTS AND PROCEDURAL HISTORY.

Hayes alleged two causes of action or theories of recovery in his trial court petition. The following facts are taken from the petition, unless otherwise indicated. In support of his first theory Hayes alleged essentially the following: In May 1990 he had been employed at the Stillwater Garfield's for about two years and had recently been promoted to assistant manager. He was led to believe he would be employed as long as he did an adequate job and performed his duties. On May 29, 1990, Hayes was terminated despite the fact he had at all times performed his job satisfactorily and there were no grounds for his discharge. Hayes was terminated in violation of his contractual entitlement to continued employment.

In support of his second theory Hayes alleged: He was discharged because he reported and was attempting to investigate theft of property and embezzlement from Garfield's. Accordingly, his discharge violated the public policy of Oklahoma and constituted the tort of wrongful discharge.

As can be seen, the allegations in Hayes' petition are extremely general. He does not indicate the person who terminated him, who he believed was embezzling from Garfield's, or who he reported any theft or embezzlement to. From what we can glean from Hayes' brief in the trial court and his submissions on appeal it appears he asserts it was his supervisor, i.e. the manager at the Stillwater Garfield's, that was embezzling money from the restaurant, that Hayes either directly or indirectly confronted this manager with his concern about missing money, that the manager had Hayes sign a statement that he, Hayes, had left the restaurant and/or restaurant safe unlocked on one occasion and that it was this manager who terminated him. We also glean from Hayes' submissions that he was going to continue to investigate the embezzlement he had uncovered and he was going to report it and this is the reason the manager fired Hayes. Hayes also informs us in his appellate submissions that after his discharge the manager was actually charged and convicted of six counts of embezzlement from Garfield's.

In essence then, Hayes asserted two claims. The first a breach of contract claim based on oral assurances from his supervisors that his employment with Garfield's would continue so long as he satisfactorily performed his job or his good job performance continued. Second, a tort claim, alleging violation of the public policy exception to the employment-at-will doctrine under Burk v. K-Mart Corp., 770 P.2d 24 (Okla.1989). Garfield's moved to dismiss Hayes' petition for failure to state a claim upon which relief could be granted. The trial court granted the motion, Hayes appealed and the Court of Appeals affirmed. ¹ We previously granted certiorari to decide whether either theory advanced stated a claim sufficient to overcome or act as an exception to the employment-at-will doctrine.

III. EXCEPTIONS TO THE EMPLOYMENT-AT-WILL DOCTRINE.

Where an employment contract is of indefinite duration, it is terminable at will by either party. Singh v. Cities Service Oil Company, 554 P.2d 1367, 1369 (Okla.1976). In Burk v. K-Mart, supra, this Court recognized that, under the classic statement of the at-will rule "an employer may discharge an employee for good cause, for no cause or even for cause morally wrong, without being thereby guilty of legal wrong." 770 P.2d at 26. However, the employment-at-will doctrine has been judicially limited by exceptions that restrict the grounds on which an at-will employee may be discharged. Hayes relies on two exceptions to the at-will doctrine: (1) breach of contract that he contends restricts the employer's power to discharge, and (2) public policy tort under Burk v. K-Mart, supra. We now turn to a discussion of both.

III(A). THE BREACH OF CONTRACT EXCEPTION.

Hayes argues that an otherwise at-will employee who has been discharged may maintain an action for breach of contract where the at-will presumption is rebutted by a contractual promise of continued employment. In his petition, Hayes claims "[he] was led to believe that he would be employed as long as he did an adequate job and performed his duties," i.e. as long as he performed his job satisfactorily. In addition to these oral assurances, he points to his recent promotion to assistant manager, which his appellate submissions indicate was approximately two months prior to his discharge, to support his claim. Relying on these purported representations and the recent promotion he urges he had a contractual claim to job security which was breached by his discharge. He also urges that because Oklahoma recognizes no distinction between oral and written promises as providing a valid basis for a breach of contract action, except for cases falling within the statute of frauds, he has sufficiently stated a claim for breach of contract. In essence, what Hayes is alleging is that the alleged oral assurances he relies upon, i.e. he would be employed as long as he did an adequate job and/or performed his duties satisfactorily, constituted a binding agreement that protected him from discharge except for "just cause". We disagree.

The trial court dismissed Hayes' breach of contract claim, finding him to be an employee-at-will with no contractual entitlement to continued employment. In affirming the dismissal of Hayes' contract claim, the Court of Appeals noted that the oral assurances relied on by Hayes did not rise to the level of promises of indefinite job security sufficient to impose an implied contract on an employer and that Hayes failed to allege detrimental reliance on the assurances, something the Court of Appeals found necessary under Hinson v. Cameron, 742 P.2d 549 (Okla.1987). ² In our view Oklahoma case law clearly points to the conclusion Hayes' petition is legally insufficient to state a claim for breach of contract. This would be true even if the petition contained allegations of detrimental reliance. ³

In Hinson v. Cameron, supra, we rejected a plaintiff's claim that her employer's personnel manual constituted an implied contract and that its provisions constituted a binding agreement introducing a just cause provision into the employment relationship. The plaintiff in Hinson alleged that her termination was without cause because it was not based on any of the grounds listed in her employer's personnel manual as possible grounds for disciplinary action or termination. While we recognized that the language of an employer's personnel manual may alter the employment-at-will relationship, we refused to imply from a list of grounds for termination or a reference to possible disciplinary action any contractual entitlement to continued employment where "the manual lists but examples of some, although not all, grounds for termination." (emphasis in original) Hinson, supra, 742 P.2d at 556. In our view, Hayes is in no different situation than the plaintiff in Hinson.

Our analysis is compelled both by previous cases of this Court and the United States Court of Appeals for the Tenth Circuit in the employment law arena. In Blanton v. Housing Authority of the City of Norman, 794 P.2d 412 (Okla.1990), a case concerning public employment, a public housing director alleged that statements made to him during his employment interview to the effect he could work as long as his work was satisfactory created a property interest in continued employment subject to due process protection. Citing Asbill v. Housing Authority of Choctaw Nation of Oklahoma, 726 F.2d 1499 (10th Cir.1984), this Court recognized that unless an employee-at-will can prove substantive restrictions on the employer's power to discharge, the employment must be considered to be terminable at will. In Blanton we concluded that "[a]...