City of Fort Worth v. Zimlich

• Decision Date: 09 November 2000
• Citation: 29 S.W.3d 62
• Parties: (Tex. 2000) CITY OF FORT WORTH, TEXAS, PETITIONER v. JULIUS D. ZIMLICH, RESPONDENT NO. 98-1014
• Court: Texas Supreme Court

Page 62

29 S.W.3d 62 (Tex. 2000)

CITY OF FORT WORTH, TEXAS, PETITIONER v. JULIUS D. ZIMLICH, RESPONDENT

NO. 98-1014

IN THE SUPREME COURT OF TEXAS

Argued on December 8, 1999

Decided June 29, 2000

Rehearing Overruled November 9, 2000.

ON PETITION FOR REVIEW FROM THE COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS

[Copyrighted Material Omitted]

[Copyrighted Material Omitted] JUSTICE GONZALES delivered the opinion for a unanimous Court.

In this case we must decide whether the City of Fort Worth engaged in retaliatory discrimination against Julius Zimlich, an employee, in violation of the Whistleblower Act. See TEX. GOV'T CODE 554.001-.009 (Supp. 2000). The trial court rendered judgment on a jury verdict, awarding Zimlich actual damages for lost earnings and mental anguish, and punitive damages. The City appealed, asserting primarily that Zimlich adduced no evidence that the City discriminated against him and no evidence to support the punitive damages award. The court of appeals affirmed the trial court's judgment. 975 S.W.2d 399, 415. We conclude that there is legally sufficient evidence to support causation for one of the three discrimination claims. But we remand that claim to the court of appeals to conduct a factual sufficiency review of the causation evidence. We further conclude that there is no evidence to support the remaining two discrimination claims and reverse the award of damages for lost past earnings and lost future earnings. Additionally, we conclude there is no evidence to support a finding of malice, and therefore reverse the award of punitive damages. Accordingly, we reverse the judgment of the court of appeals and render judgment in part and remand in part to the court of appeals.

I Background

In 1993, Julius Zimlich was employed as a deputy marshal in the warrants division of the City of Fort Worth Marshal's Office. He had served as a peace officer for fourteen years, including four years as a deputy marshal. In his four years at the Marshal's Office, Zimlich had good relationships with his supervisors and received excellent evaluations.

In May of 1993, Zimlich and another deputy marshal, Rick Estorga, were assigned to the City's newly-created Solid Waste Environmental Enforcement Program (SWEEP). SWEEP was created through a grant from the Texas Natural Resource Conservation Commission (TNRCC) to increase the enforcement powers of the City's Code Enforcement Division (CED). Prior to the SWEEP program, CED was the City department primarily responsible for enforcing City ordinances and regulations, including policing illegal dumping.

In October 1993, Zimlich received an anonymous report about an illegal disposal site operating in a residential area of Fort Worth. Zimlich investigated the site and concluded that it violated state statutes and regulations. Zimlich informed his immediate CED supervisor, Juan Mejia, that he was investigating the site. In what Zimlich describes as an unusual order, Mejia told Zimlich to report the findings to the CED Superintendent, Rufino Mendoza. Mendoza in turn instructed Zimlich to discuss the site with Director of City Services, Tom Davis. Zimlich visited with Davis about the site, and Davis told Zimlich to stop the investigation because "there was nothing out there."

The owner of the contaminated site was Ted Peters, a former Fort Worth City Council member. On the day Davis ordered Zimlich to stop his investigation, Davis met with Peters and informed him that the site did not have the proper permit for waste disposal and that Peters must stop dumping materials there. Davis also told Peters to remove some of the waste and bury the rest.

Zimlich reported his communications with Davis and Mendoza to Marshal Norman Donoho in November 1993. Zimlich told Donoho that he believed Davis and Mendoza were preventing Zimlich from investigating an illegal disposal site. Donoho told Zimlich that he would look into the matter and that Zimlich should make whatever reports he felt were necessary to appropriate authorities. The next month, Zimlich reported the site to the TNRCC and reported his belief that Davis and Mendoza were obstructing his investigation to the Office of the Attorney General and the Tarrant County District Attorney's Office.

In February 1994, Zimlich discussed the Peters site with a Fort Worth televison station airing a series on illegal dumping. Following the news program, the City Council requested an explanation. Davis authored a response that was signed by an assistant city manager, stating that Davis's investigation of the site revealed only non-hazardous materials, and that Davis had instructed the owner to remove some of the waste and bury the rest. A TNRCC inspection later revealed, however, that hazardous solid waste had been illegally dumped on the site.

In April 1994, the SWEEP program was eliminated due to a reduction in state funding. Zimlich requested a transfer back to the warrants division of the Marshal's Office. Donoho approved the transfer, but permanently assigned Zimlich and Estorga to courthouse security duty even though previous assignments there were on a temporary rotating basis and there were openings in the warrants division. Some deputies testified that they viewed courthouse security as low-level duty usually designated for rookies and retirees. Zimlich testified that he asked Donoho why he was assigned courthouse duty, and Donoho replied that Zimlich was "lucky to have a job after the [Peters] incident." Four months after Zimlich returned to the Marshal's Office, Donoho conducted an annual performance evaluation for Zimlich. Prior to his SWEEP duty, Zimlich's superiors had always commended him for his superior performance and evaluated him as above average. Zimlich's evaluation after he returned to the Marshal's Office, however, was significantly lower. Donoho rated Zimlich as average and noted that Zimlich was not a team player and that he needed to accept his job assignments willingly. Zimlich officially noted his disagreement with his evaluation.

After eight months on courthouse security duty, Donoho assigned Zimlich to his preferred position in the warrants division. Later, a senior deputy position became available in the department. Zimlich applied for the position, and was interviewed for the job along with five other candidates, but he was not promoted. Donoho was one of the three members of the panel that made the promotion decision. In the summer of 1995, Donoho retired and was replaced by Marshal Rutledge. Within several months, Zimlich was promoted to senior deputy. Soon after, a position for chief deputy became available. Zimlich applied for this position, but was not promoted.

Based on this evidence, the jury concluded that the City discriminated against Zimlich with malice in retaliation for reporting Davis's illegal obstruction of an official investigation. The jury awarded $200 for lost earnings in the past, $300,000 for lost earnings in the future, $300,000 for mental anguish, and $1,500,000 in punitive damages. The City appealed, and the court of appeals affirmed the trial court's judgment. 975 S.W.2d at 415. The City now petitions this Court for review.

II Discussion

The City raises several issues on appeal. First, the City contends that it cannot be liable under the Whistleblower Act since there is no evidence that the City discriminated against Zimlich. Second, the City argues that there is no evidence of malice to support the punitive damages award. The City also challenges whether venue was proper, whether the jury charge was supported by the pleadings, and whether Zimlich made admissions inconsistent with the judgment. We address each of these issues in turn.

A

A governmental entity is liable for damages under the Whistleblower Act if it discriminates against a public employee who reports a violation of law. See TEX. GOV'T CODE 554.001-.009 (Supp. 2000). The statute in force at the time of the alleged discrimination against Zimlich provides: "A state agency or local government may not suspend or terminate the employment of or discriminate against a public employee who in good faith reports a violation of law to an appropriate law enforcement authority." Act of May 22, 1993, 73rd Leg., R.S., ch. 268, 1, 1993 Tex. Gen. Laws 583, 610 (amended 1995) (current version at TEX. GOV'T CODE 554.002) (Supp. 2000). While the statute does not explicitly require an employee to prove a causal link between the report and the subsequent discrimination, we held in Department of Human Servs. v. Hinds, 904 S.W.2d 629, 633 (Tex. 1995), that the employee must demonstrate all elements of the action, including causation, by a preponderance of the evidence. To show causation, a public employee must demonstrate that after he or she reported a violation of the law in good faith to an appropriate law enforcement authority, the employee suffered discriminatory conduct by his or her employer that would not have occurred when it did if the employee had not reported the illegal conduct. See Hinds, 904 S.W.2d at 633.

Zimlich contends that he reported a violation of the law to the appropriate authorities, and the City discriminated against him because of his report. Specifically, Zimlich alleges that the City discriminated against him in violation of the Act through three adverse employment decisions: (1) his assignment to courthouse security duty, (2) his delayed promotion to senior deputy, and (3) his not being promoted to chief deputy. We note that Zimlich sought no recovery for employment decisions made by Davis or Mendoza, nor does he allege they were involved in the alleged adverse employment decisions. Therefore, Davis and Mendoza's retaliatory intent, if any, is irrelevant because, as we state in Hinds, bad motives never acted on cannot be a basis for a whistleblower action. See Hinds, 904 S.W.2d at 636.

The jury found the City liable under the Whistleblower Act under a broad form submission. The City...