Conley v. Board of Trustees of Grenada County Hosp.

• Decision Date: 13 June 1983
• Docket Number: No. 82-4018,82-4018
• Parties: 115 L.R.R.M. (BNA) 4260 Carolyn CONLEY, et al., Plaintiffs-Appellees, v. BOARD OF TRUSTEES OF GRENADA COUNTY HOSPITAL, et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 175

707 F.2d 175

115 L.R.R.M. (BNA) 4260

Carolyn CONLEY, et al., Plaintiffs-Appellees, v. BOARD OF TRUSTEES OF GRENADA COUNTY HOSPITAL, et al Defendants-Appellants.

No. 82-4018.

United States Court of Appeals, Fifth Circuit.

June 13, 1983.

Paul O. Miller, III, Judith J. Johnson, Jackson, Miss., Marc A. Biggers, Greenwood, Miss., for defendants-appellants.

Leon Johnson, R. Stewart Guernsey, Grenada, Miss., for plaintiffs-appellees.

Appeal from the United States District Court for the Northern District of Mississippi.

Before RANDALL and HIGGINBOTHAM, Circuit Judges, and McDONALD ^*, District Judge.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

Five former employees of Grenada County Hospital in Mississippi brought this Sec. 1983 action on behalf of themselves and a class of similarly situated persons against the hospital's board of trustees and other officers alleging that adverse employment actions taken against them violated their due process rights. Before a class certification hearing was held, defendants moved for summary judgment claiming that the employees had no property interest in continued employment sufficient to invoke procedural due process protection. The district court denied this motion and instead granted summary judgment in favor of three employees on the ground that they were deprived of a protected property interest without due process. This court granted the hospital's application for leave to appeal from the interlocutory order in order to examine its procedural and substantive propriety. We affirm the grant of summary judgment on the property interest issue. We also affirm the grant of summary judgment on the due process issue as to two of the plaintiffs but reverse as to the third.

Carolyn Conley, Sarah Hendrix, Bessie Trotter, Joan Williams, and Chris Mayhan are former employees of the Grenada County Hospital. All were terminated but Conley, who resigned after being placed on probation. On June 8, 1981, the five employees on behalf of themselves and a described class under Fed.R.Civ.P. 23(b)(2) brought a Sec. 1983 suit against the hospital's board of trustees and other officers alleging that the hospital had disciplined or terminated them without due process. The hospital then moved to dismiss under Rule 12(b)(6), contending that the employees had no property interest in continued employment sufficient to trigger due process.

The hospital also filed the affidavit of Executive Director Fletcher Crawford, thus converting the motion to dismiss into a motion for summary judgment. In his affidavit, Crawford stated that Conley was placed on probation for inadequate work performance before she resigned and that the other plaintiffs were terminated for such reasons as insubordination, poor work performance, interference with physician-patient relationships, absenteeism, or patient complaints. He also stated that none of the plaintiffs had a written or oral contract specifying the duration of their employment. Plaintiffs responded with a memorandum of law, contending that the hospital's "employee guidebook" created a property interest and that the grievance procedures described in the guidebook had not been followed. Conley, Hendrix, and Mayhan also filed affidavits in which they described the inadequacies of the hospital's pretermination proceedings. Though not mentioned by the district court, the attorneys for Conley and Hendrix also filed affidavits describing the deficiencies of the hospital's hearings. Trotter's attorney also filed an affidavit stating that her request for a hearing was denied. In rebuttal, the hospital argued that the grievance procedures set forth in the guidebook did not mandate a hearing and thus created no property interest. It also filed affidavits contesting several allegations by Conley and Mayhan. The hospital did not, however, respond to any assertions regarding the inadequacy of its pretermination hearings.

The court denied the hospital's motion for summary judgment. It instead sua sponte entered summary judgment for plaintiffs on the property interest question, reasoning that the hospital's employee guidebook "create[d] on behalf of its employees a legitimate claim of entitlement to their employment status." The court thus did not consider plaintiffs' claim that they had been deprived of a liberty interest. In addition, the court granted summary judgment to Conley, Hendrix, and Mayhan on the issue of the requisite due process because "it is undisputed that [they] were not notified of the specific charges against them in advance of adverse employment action." The court reserved judgment on the remaining plaintiffs' claims until they could file affidavits and the hospital could respond. It also reserved judgment on an award of damages. The hospital moved to reconsider under Rule 59(e) on the grounds that the court's finding of a property interest was erroneous. The court denied the motion in a second memorandum opinion but certified the order for an interlocutory appeal. The hospital timely applied ¹ for leave to appeal, challenging the procedural and substantive propriety of the summary judgment. This court granted leave to appeal.

Summary Judgment on the Property Interest Question

The hospital contends that the sua sponte summary judgment ruling in favor of the plaintiffs on the property interest issue was procedurally erroneous because plaintiffs filed no cross-motion. We note initially that the hospital could have sought direct appeal from this judgment but instead first filed a Rule 59(e) motion for reconsideration. It did not, however, challenge the procedural propriety of the summary judgment ruling in this Rule 59(e) motion. The district court expressly noted this failure in its second opinion: "Defendants do not challenge, as a procedural matter, our entry of judgment in favor of plaintiffs who had not moved for summary judgment." As a general principle of appellate review, we refuse to consider issues not raised below. See Delesdernier v. Porterie, 666 F.2d 116, 124-25 (5th Cir.), cert. denied, --- U.S. ----, 103 S.Ct. 86, 74 L.Ed.2d 81 (1982). This refusal is particularly appropriate when, as here, a party requests the trial court to reconsider the judgment but conspicuously omits a contention of procedural irregularity that the court could have corrected immediately. See Fackelman v. Bell, 564 F.2d 734, 736 n. 1 (5th Cir.1977). Nevertheless, if the issue is a purely legal one and the asserted error is so obvious that the failure to consider it would result in a miscarriage of justice, we have proceeded. See Fehlhaber v. Fehlhaber, 681 F.2d 1015, 1030-31 (5th Cir.1982).

We find here that neither prong of this "plain error" exception has been met. First, the question whether summary judgment may be granted for the nonmoving party is thoroughly factridden. It depends on whether the original movant has had an adequate opportunity to show that there is no genuine issue of material fact or whether all material facts are already before the reviewing court. See 10A C. Wright, A. Miller & M. Kane, Federal Practice and Procedure Sec. 2720 (1983). Moreover, the merit of the hospital's omitted claim is not so plain or obvious that our failure to consider it would result in manifest injustice. A determination of the existence of a property interest turns on a similar set of facts as a determination of the non-existence of a property interest. We recognize that asserting the absence of a property interest as a matter of law on a given Rule 56 record is not a concession that its presence is in logic an obverse answer. Yet, the hospital stated in a reply memorandum that no discovery was needed before determination of the property interest issue. Moreover, the hospital at no time suggested to the district court in its extensive attack upon his decision that fact issues could be shown. At oral argument the hospital nonetheless suggested that the "reasonable employee expectation" test employed by the district court necessitated discovery regarding employees' perception of the guidebook, without which the summary judgment was premature. We disagree. As will be seen, the question of property interest in this case proves to be the legal one of interpreting the law of Mississippi as expressed in the rules of the hospital. Accordingly, we decline to review the procedural propriety of the sua sponte grant of summary judgment. ²

Although the hospital failed to raise the procedural propriety of the summary judgment ruling before the district court, it did there challenge the substantive propriety of the ruling. In reviewing the court's grant of summary judgment, we must consider the evidence in a light most favorable to the hospital and determine whether there were no genuine factual disputes and whether the plaintiffs were entitled to judgment as a matter of law. See Rule 56(c); Daly v. Sprague, 675 F.2d 716, 724 n. 10 (5th Cir.1982). The district court's ruling thus can be sustained only if plaintiffs demonstrated no material issue of fact regarding their property interest in continued employment at the hospital. We conclude that the trial court was correct in its decision that plaintiffs enjoyed the requisite property interest.

A protected property interest in employment exists only when the employee has "a legitimate claim of entitlement to it." Board of Regents v. Roth, 408 U.S. 564, 577, 92 S.Ct. 2701, 2709, 33 L.Ed.2d 548 (1972). The source of such a claim can be a state statute, a local ordinance, a rule, or a mutually explicit understanding. Perry v. Sindermann, 408 U.S. 593, 601, 92 S.Ct. 2694, 2699, 33 L.Ed.2d 570 (1972); White v. Mississippi State Oil and Gas Board, 650 F.2d 540, 541 (5th Cir.1981). Whatever the source, however, "the sufficiency of the claim of entitlement must be decided by reference to state law." Bishop v. Wood, 426 U.S. 341, 344, 96 S.Ct. 2074, 2077, 48 L.Ed.2d 684 (1976). Accordingly, the issue here is whether, under...