Aasmundstad v. Dickinson State College, 10365

• Decision Date: 10 August 1983
• Docket Number: No. 10365,10365
• Citation: Aasmundstad v. Dickinson State College, 337 N.W.2d 792 (N.D. 1983)
• Parties: 98 Lab.Cas. P 55,410, 13 Ed. Law Rep. 160 Palmer O. AASMUNDSTAD, Plaintiff and Appellant, v. DICKINSON STATE COLLEGE, Defendant and Appellee. Civ.
• Court: North Dakota Supreme Court

Page 792

337 N.W.2d 792

98 Lab.Cas. P 55,410, 13 Ed. Law Rep.

160

Palmer O. AASMUNDSTAD, Plaintiff and Appellant, v. DICKINSON STATE COLLEGE, Defendant and Appellee.

Civ. No. 10365.

Supreme Court of North Dakota.

Aug. 10, 1983.

Daniel J. Chapman (argued), of Chapman & Chapman, Bismarck, for plaintiff and appellant.

Ward M. Kirby (argued), of Mackoff, Kellogg, Kirby & Kloster, Dickinson, for defendant and appellee.

PAULSON, Justice.

Palmer O. Aasmundstad [Aasmundstad] appeals from a judgment ¹ of the District Court of Stark County dismissing his complaint against Dickinson State College [College]. We reverse and remand the case for proceedings consistent with this opinion.

On May 23, 1979, Aasmundstad wrote a letter to the president of the College informing him that Aasmundstad would be retiring from his position as Director of Buildings and Planning effective July 1, 1980. Aasmundstad had been employed at the College for approximately 24 years and had served in various positions during that time.

Almost ten months later, on March 12, 1980, Dr. Albert A. Watrel, president of the College, sent Aasmundstad a letter which stated in relevant part as follows:

"Since the college will be operating on an austere budget for the fiscal year which begins July 1, 1980, we would like to fulfill our financial commitment to you before that date. For this reason, we are asking that you take all of your accumulated earned leave before your retirement on June 30, 1980. You may check with the business office to determine how many earned vacation days you have remaining and make arrangements with Mr. Binstock [director of business affairs for the College] to take time off at your convenience."

On the next day, Aasmundstad wrote the following letter to Dr. Watrel:

"This is in reply to your letter of yesterday, March 12, 1980.

"I now have thirty days accumulated annual leave and will have twelve days accrued leave through my contract year, June 30, 1980. This is a total of forty-two days leave for which I will be paid for at the end of my contract year which ends June 30, 1980.

....

"I will terminate my employment as per the contract which ends June 30, 1980."

Two weeks later, on March 27, 1980, Dr. Watrel responded in a letter as follows:

"I find your March 13, 1980 reply concerning your accrued annual leave unacceptable....

"This letter is written to inform you that you will have until April 30, 1980 to make arrangements with Mr. Binstock to take the leave at your convenience. If you have not made the necessary arrangements by that date, your last official work day will be April 30, 1980, and you will be put on leave as of May 1, 1980 until all accumulate[d] days are used.

"I want to make it perfectly clear that Dickinson State has no intention of paying you for unused leave days that you do not take before June 30, 1980."

Despite Dr. Watrel's letter, Aasmundstad presented himself at his office for work on May 1, 1980, and on each business day thereafter until May 12, 1980, when he was ordered to leave his office by Alvin Binstock, the College's director of business affairs. ² Aasmundstad testified that after he was ordered to leave his office, he remained available by telephone to perform work for the College through June 30, 1980.

After Aasmundstad did not receive payment for his earned annual leave, he brought suit against the College. In a complaint dated March 26, 1981, Aasmundstad requested judgment against the College in the sum of $6,000, together with costs and disbursements of the action.

The trial was held before the court without a jury on December 1, 1982. During the trial, Aasmundstad claimed that he was entitled to payment in the amount of $4,476.80 for 40 days of earned annual leave. ³ Aasmundstad's employment contract with the College for the period of July 1, 1979, through June 30, 1980, was entered in evidence. The contract listed his annual salary as $29,100 and incorporated "all rules, regulations and policies of this institution and the State Board of Higher Education". A copy of the "Staff Personnel Handbook", which contains provisions relating to annual leave for administrative personnel, was also entered in evidence.

During the trial, Binstock testified that there have been employees at the College who, upon retirement, have been paid for their unused accrued leave time rather than being directed to use it. Binstock stated that "It's basically been our policy that depending on the departmental needs and the administrator or the individual who has the leave coming, whether or not they can be spared for that period of time." He further testified that "If they cannot be, then they are taken through their contract period and they are paid for their annual leave which has been accumulated." Binstock admitted, however, that he knew of no instances, prior to Aasmundstad's retirement, in which a person was required to take their annual leave time before retirement. Dr. Watrel was also unable to relate any instances prior to Aasmundstad's retirement in which he directed a retiring employee to use his or her annual leave time. Dr. Watrel contended that under the annual leave provisions of the Staff Personnel Handbook he could require a person to take all of his or her annual leave in any particular year.

In its findings of fact, conclusions of law, and order for judgment, the trial court found that Aasmundstad's action was governed by Article VIII of the North Dakota Constitution and Chapter 15-10 of the North Dakota Century Code. Pursuant to this authority, the court concluded that the rights of any employee are governed by the contract between the employee and the institution as approved by the State Board of Higher Education and that, in the instant case, only elements of contract law were involved. The court further found that Aasmundstad was employed under the provisions of such a contract; that the contract incorporated various policies adopted by the State Board of Higher Education, including the Staff Personnel Handbook; and that, pursuant to the contract, all employees terminating their employment were entitled to be paid for all unused, earned annual leave.

The trial court also found that various parts of the annual leave provisions contained in the Staff Personnel Handbook were "vague and ambiguous and in some respects conflicting, for which reason parol evidence was received and admitted into evidence so that the Court might resolve such conflicting, vague and ambiguous provisions so as to determine what the parties meant when contracting".

In finding of fact No. 18, the court also stated:

"18. The Court finds that in prior practices at the college, the Staff Personnel Handbook has been interpreted to allow prior employees to accumulate earned but unused leave at the date of their retirement and to be compensated for such unused leave at retirement, such practices being with the consent of the college and the party terminating employment at the college. Further, the Court finds that no person retiring or terminating employment with the college prior to the employment of Aasmundstad had been compelled to take annual leave during such term of employment, and that although the requirements made of Plaintiff Aasmundstad were discriminatory because he was the first individual singled out to be compelled to use his annual leave during the course of employment, such discrimination was not unlawful, and was permissible discrimination not prohibited by contractual arrangements between the parties or by the leave provisions of the Staff Personnel Handbook."

The court thus determined that Aasmundstad had failed to meet his burden of proving that he had a contractual right to save and accumulate his earned but unused leave until his retirement and to claim compensation for such leave time at the date of termination of his contract. The court concluded that, based upon the annual leave provisions in the Staff Personnel Handbook, the College had acted within its rights. Judgment was entered on December 20, 1982, and Aasmundstad appeals.

Although the parties have posited various formulations of the issue involved in the instant case, we believe the issue can be stated as follows: whether or not the College had the contractual authority, pursuant to the annual leave provisions in the Staff Personnel Handbook, to require Aasmundstad to use up his entire accumulated annual leave time prior to his date of retirement.

The State Board of Higher Education was created to control and administer several state educational institutions, including the College at Dickinson. See N.D. Const. art. VIII, Sec. 6(1)(d). The powers and authority of the State Board of Higher Education are set forth in the North Dakota Constitution and in the North Dakota Century Code. See N.D. Const. art. VIII, Sec. 6; Sec. 15-10-17, N.D.C.C. See also Zimmerman v. Minot State College, 198 N.W.2d 108, 112 (N.D.1972); Posin v. State Board of Higher Education, 86 N.W.2d 31, 35 (N.D.1957). Section 15-10-17(3), N.D.C.C., provides that the State Board of Higher Education has the power to "adopt rules, regulations, and bylaws for the government of each of such institutions and of all the departments and branches thereof". Pursuant to such authority the Board has adopted the Staff Personnel Handbook, which contains provisions relating to annual leave for administrative employees and which was admitted in evidence in the instant case.

We further note the general rule that an employee has no inherent right to receive accrued vacation pay upon termination of the employer-employee relationship in the absence of a statute so providing or a contractual agreement, either express or implied. E.g., National Rifle Ass'n v. Ailes, 428 A.2d 816, 820 (D.C.1981); City of Webster Groves v. Institutional & Pub. Em. U., 524 S.W.2d 162, 167 (Mo.App.1975); N.M. St. Labor & Indus. v. Deming Nat. Bank, 96 N.M. 673, 634 P.2d 695, 696 (1981); Konig...