Carpenter v. American Excelsior Co., No. 85-CV-40567-FL.

• Court: United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
• Writing for the Court: Russell J. Thomas, Jr., Detroit, Mich., for defendant
• Citation: 650 F. Supp. 933
• Docket Number: No. 85-CV-40567-FL.
• Decision Date: 08 January 1987
• Parties: Spencer J. CARPENTER, Plaintiff, v. AMERICAN EXCELSIOR COMPANY, a foreign corporation, Defendant.

650 F. Supp. 933

Spencer J. CARPENTER, Plaintiff,
v.
AMERICAN EXCELSIOR COMPANY, a foreign corporation, Defendant.

No. 85-CV-40567-FL.

United States District Court, E.D. Michigan, S.D.

January 8, 1987.

650 F. Supp. 934

Max Dean, Flint, Mich., for plaintiff.

Russell J. Thomas, Jr., Detroit, Mich., for defendant.

MEMORANDUM OPINION AND ORDER

NEWBLATT, District Judge.

Plaintiff brought this action in the Circuit Court for the County of Genesee, alleging that defendant wrongfully discharged him from its employ. Pursuant to 28 U.S.C. §§ 1332 and 1441(a), defendant removed the action based on diversity of citizenship. Plaintiff's contention of wrongful discharge is based on two theories. First, plaintiff claims that defendant breached an implied oral contract that he could be terminated only for just cause. Then, plaintiff alleges that his discharge resulted from age discrimination in violation of the Elliott-Larsen Civil Rights Act, MICH.COMP.LAWS ANN. §§ 37.2101, et seq. (West 1985). Defendant filed this Motion for Summary Judgment under Fed.R. Civ.P. 56, claiming that plaintiff's action can be decided on the evidence currently in the record, since there is no issue of material fact. Also pending is plaintiff's Motion to Compel answers to certain interrogatories. For the reasons set forth below, defendant's motion for summary judgment will be granted as to both counts, and plaintiff's motion to compel will be denied.

The pertinent facts of this case are as follows: On July 18, 1981 when plaintiff was 59, he was hired as a "floor covering specialist" for the Westland branch office of American Excelsior Company, where he was employed until June 15, 1984, when his employment was terminated. (Plaintiff's Dep. 34, 111).

Fred Kelly, one of defendant's customers, initially put plaintiff in contact with Loren Dahlberg, the manager of the Westland branch office. Mr. Kelly was aware that a major company for whom plaintiff sold carpeting had gone bankrupt. (Plaintiff's Dep. 9-12). Plaintiff interviewed

650 F. Supp. 935

with Mr. Dahlberg on July 8, 1981, at which time plaintiff alleges that Mr. Dahlberg told him that he would be able to work for the company as long as he performed properly, and that his age was no barrier to his employment. (Plaintiff's Dep. 167, 234); See also, plaintiff's Affidavit in response to Defendant's Motion for Summary Judgment ¶ 2(j). Mr. Dahlberg offered the available position with the company to plaintiff during this interview, choosing plaintiff over forty other applicants who were not as experienced as plaintiff. (Plaintiff's Dep. 7, 26, 261). After these alleged representations by Mr. Dahlberg, he requested that plaintiff complete an employment application which expressly set forth the following acknowledgement

Further, I understand and agree that my employment is for no definite period and may regardless of the date of payment of my wages and salary be terminated at any time without any previous notice.

(Plaintiff's Employment Application p. 2, attached as Exhibit B to defendant's Motion for Summary Judgment). Plaintiff alleges that he and Mr. Dahlberg never discussed this provision. Further, plaintiff claims that he did not ever read the "fine print" containing this language, nor did he sign the application. (Plaintiff's Affidavit, ¶ 2(k)).¹

In its motion, defendant contends that the general rule of law in Michigan is that employment for an indefinite time is terminable at the will of either party. Lynas v. Maxwell Farms, 279 Mich. 684, 687, 293 N.W. 315 (1937). The Michigan Supreme Court carved out a narrow exception to this rule, however, in the seminal decision of Toussaint v. Blue Cross & Blue Shield, 408 Mich. 579, 292 N.W.2d 880 (1980). In Toussaint, the Court recognized that:

(1) A provision of an employment contract providing that an employee shall not be discharged except for cause is legally enforceable although the contract is not for a definite term — the term is "indefinite," and

(2) such a provision may become part of the contract either by express agreement, oral or written, or as a result of an employee's legitimate expectations grounded in an employer's policy statements.

Id. at 598, 292 N.W.2d 880.

In order to defeat defendant's motion for summary judgment, plaintiff must show that more than a mere subjective expectancy existed that he would be terminated only for just cause. Reid v. Sears, Roebuck & Co., 790 F.2d 453 (6th Cir.1986). While this subjective expectancy of continued employment standing alone is an insufficient basis for a Toussaint claim, Schwartz v. Michigan Sugar Company, 106 Mich.App. 471, 308 N.W.2d 459, 462, appeal denied, 414 Mich. 870 (1982), it is a prerequisite for establishing that an implied contract arose for just cause termination. Longley v. Blue Cross & Blue Shield of Michigan, 136 Mich.App. 336, 356 N.W.2d 20 (1984).

In Reid, the Sixth Circuit examined three cases consolidated on appeal, that originated in the Eastern District of Michigan.² All three suits were brought against Sears. Sears successfully argued for summary judgment in the district court by relying on language found in the employment applications which acknowledged that employment was terminable at will.³ This provision in the application was found to be outside the coverage of the Toussaint exception, as indicated by that court when it wrote:

650 F. Supp. 936

Employers are most assuredly free to enter into employment contracts terminable at will without assigning cause. We hold only that an employer's express agreement to terminate only for cause or statements of company policy and procedure to that effect, can give rise to rights enforceable in contract.

Reid, 790 F.2d at 455, quoting Toussaint v. Blue Cross & Blue Shield, 408 Mich. 579, 610; 292 N.W.2d 880 (1980). Accord, Valentine v. General American Credit, Inc., 420 Mich. 256, 258-259, 362 N.W.2d 628 (1984) ("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"). The Reid court found that all three plaintiffs were bound by the language contained in their employment applications, and that they did not create an issue of fact by relying on Sears' Employee handbook to show that they indeed should be terminated only for just cause.⁴ The court readily distinguished Toussaint, in which case the employer provided literature containing language that promised "to treat employees leaving Blue Cross in a fair and consistent manner and to release employees for just cause only."⁵ Toussaint, 408 Mich. at 617, 292 N.W.2d 880, quoted in Reid, 790 F.2d at 460.

Here, plaintiff contends that there is a genuine issue of fact as to whether an implied contract for just cause employment arises, based on Mr. Dahlberg's statement that he would be employed as long as he performed properly. Plaintiff also argues that he is not bound by the language contained in the employment application because he neither discussed it with Mr. Dahlberg, nor did he notice the fine print on the employment application. (Plaintiff's Aff. ¶ 2(k)).

As to plaintiff's first contention, it does not appear that...