Considine v. Compass Group USA, Inc.

• Decision Date: 07 August 2001
• Docket Number: No. COA00-843.,COA00-843.
• Citation: 145 NC App. 314,551 S.E.2d 179
• Court: North Carolina Court of Appeals
• Parties: Frank A. CONSIDINE, Plaintiff-Appellant, v. COMPASS GROUP USA, INC., Defendant-Appellee.

551 S.E.2d 179

145 NC App. 314

Frank A. CONSIDINE, Plaintiff-Appellant, v. COMPASS GROUP USA, INC., Defendant-Appellee.

No. COA00-843.

Court of Appeals of North Carolina.

August 7, 2001.

Ferguson, Stein, Wallas, Adkins, Gresham, & Sumter, P.A., by John W. Gresham, Charlotte, for plaintiff-appellant.

Smith Helms Mulliss & Morre, L.L.P., by H. Landis Wade, Jr. and Paul M. Navarro, Charlotte, for defendant-appellee.

McGEE, Judge.

Frank A. Considine (plaintiff) appeals the dismissal by the trial court, pursuant to N.C. Gen.Stat. § 1A-1, Rule 12(b)(6), of his complaint alleging wrongful discharge from employment by his former employer, Compass Group USA, Inc. (defendant) in violation of North Carolina public policy. Plaintiff also alleged he was a third-party beneficiary of a settlement agreement between defendant and the United States government but plaintiff filed a voluntary dismissal without prejudice of this claim.

Relevant allegations in plaintiff's complaint filed 6 December 1999 include:

1. The Plaintiff, Frank A. Considine, is a citizen of North Carolina and a resident of Mecklenburg County. Until November 15, 1996, Plaintiff was employed as in-house counsel by Compass Group, USA, Inc.

2. Defendant, Compass Group, USA, Inc. (hereinafter "Compass Group" or "Compass") is a Delaware corporation having it's principle [sic] place of business in Charlotte, North Carolina. Compass Group provides products and services under food service contracts for federal, state, local government, and private corporations throughout the United States.

3. Compass, as of the time of the events complained of herein, owned and controlled various food service contracts, including those of Canteen Corporation, Flagstar Corporation, and Service America Corporation.

4. Plaintiff was employed by Defendant in June of 1996, as an in-house corporate counsel. His original assignment was to implement the acquisition of certain assets of Service America Corporation by Compass.

5. Plaintiff was also assigned duties regarding a compliance program mandated by a settlement agreement between Canteen and the federal government.

6. Between January 1988 and January 1994, Canteen provided commissary and restaurant services to the United States in Canteen's mid-Atlantic region. Canteen provided these services pursuant to various contracts with the United States.

7. Canteen was required under the terms of a settlement agreement entered into in December of 1995, with the United States, to pay the sum of $900,000.00 for its failure to pass through rebates under the service contracts and to implement a compliance program to ensure that Canteen properly rebated monies to the United States under ongoing contracts.

8. Under the terms of the settlement agreement, Defendant was specifically prohibited from retaliating against an employee for reporting the failure to properly credit rebates.

9. In carrying out his duties regarding the compliance program, Plaintiff discovered unlawful conduct on the part of the Defendant which affected both federal, state and local government service contracts.

10. Plaintiff then advised his supervisor, the general counsel for the Defendant, regarding the conduct he had discovered. Plaintiff also sought advice from outside counsel regarding ways for the Defendant to remedy its conduct.

11. Less than two weeks later, on November 15, 1996, Plaintiff was discharged without warning on the grounds that "things just weren't working out."

12. Plaintiff was then asked to leave the building without returning to his office. When he did return to his office to obtain his personal effects, he found the general counsel rifling through his desk in search of documents which would show the unlawful conduct of the Defendant.

13. Plaintiff was then asked to sign an agreement that would provide him three months' severance pay if he waived his right to bring any legal action against the Defendant and signed a confidentiality agreement with the Defendant. Plaintiff refused to do so.

14. Plaintiff was terminated because he had learned of the unlawful conduct, reported it to his supervisors and sought to end the unlawful practices.

15. The Defendant's actions as set out herein violate the public policies of North Carolina and are thus unlawful.

16. Because of the unlawful conduct set out herein, Plaintiff has been damaged in an amount in excess of $10,000.00.

Defendant filed a motion to dismiss plaintiff's complaint for wrongful discharge pursuant to Rule 12(b)(6) for failure to state a claim upon which relief could be granted. Following a hearing on defendant's motion, the trial court granted the motion to dismiss plaintiff's claim for wrongful discharge in an order filed on 3 April 2000. Plaintiff appeals.

The essential question in reviewing the grant of a motion to dismiss pursuant to N.C. Gen.Stat. § 1A-1 (1999) Rule 12(b)(6) is whether, "as a matter of law, the allegations of the complaint, treated as true, are sufficient to state a claim upon which relief can be granted under some legal theory." Lynn v. Overlook Development, 328 N.C. 689, 692, 403 S.E.2d 469, 471 (1991) (citation omitted). A motion to dismiss pursuant to Rule 12(b)(6) should not be granted "`unless it appears to a certainty that plaintiff is entitled to no relief under any state of facts which could be proved in support of the claim.'" Sutton v. Duke, 277 N.C. 94, 103, 176 S.E.2d 161, 166 (1970) (citation omitted) (emphasis in original). Therefore, we review the allegations in plaintiff's complaint to determine whether the trial court erred in dismissing plaintiff's claim for wrongful discharge under Rule 12(b)(6).

The discharge of an employee at will generally does not support an action for wrongful discharge in this state. However, as argued by plaintiff, exceptions to this general rule have been recognized by our appellate courts, including a prohibition against termination for a purpose in contravention of public policy. Plaintiff cites the leading cases that have recognized this exception, being Sides v. Duke University, 74 N.C.App. 331, 328 S.E.2d 818, disc. review denied, 314 N.C. 331, 333 S.E.2d 490 (1985), overruled on other grounds, 347 N.C. 329, 493 S.E.2d 420 (1997); Coman v. Thomas Manufacturing Co., 325 N.C. 172, 381 S.E.2d 445 (1989); and Amos v. Oakdale Knitting Co., 331 N.C. 348, 416 S.E.2d 166 (1992). In each of these cases, our Courts have recognized an exception to the employment at will doctrine by identifying a cause of action for wrongful discharge in violation of public policy. Under the exception, the employee has the burden of pleading and proving that the employee's dismissal occurred for a reason that violates public policy.

The plaintiff in Sides alleged in her complaint "that her wrongful discharge [was] in retaliation for truthfully testifying in court [and] was a wanton and reckless violation of public policy and her rights[.]" Sides, 74 N.C.App. at 335,328 S.E.2d at 822. She alleged in her complaint a series of specific actions by the defendant-employer that culminated in the plaintiff's discharge in retaliation for her refusal to testify falsely in a medical malpractice case. These alleged actions by the defendant included threats, a hostile attitude and isolation of the plaintiff in her work environment. Our Court began the analysis of the plaintiff's claim for wrongful discharge by stating "that the legislature is not at all adverse to courts of this State entertaining actions based on a violation of policies that have been enacted or otherwise established for the protection and benefit of the public." Id. at 337, 328 S.E.2d at 823. Our Court in Sides cited criminal statutes and a public policy that defendant's alleged conduct violated in holding defendant had no right to terminate plaintiff for an unlawful reason or purpose that contravenes public policy. We further noted that

[p]erjury and the subornation of perjury were both felonies at common law and are so punishable by G.S. 14-209 and G.S. 14-210. The intimidation of witnesses was an offense at common law and is punishable by G.S. 14-226 as a misdemeanor. These offenses are also an affront to the integrity of our judicial system, an impediment to the constitutional mandate of the courts to administer justice fairly[.]

Id. at 337-38, 328 S.E.2d at 823-24.

The plaintiff in Coman alleged in his complaint that the defendant-employer discharged him for his refusal to violate United States Department of Transportation regulations by operating his vehicle excessive hours and his refusal to falsify records. The complaint also alleged that the plaintiff was informed by the defendant that he would have to continue to drive for periods of time that violated federal regulations if he wanted to keep his job and that if the plaintiff refused, his pay would be reduced by fifty percent. Our Supreme Court, in finding that the complaint stated a cause of action for wrongful discharge, noted that the alleged conduct by defendant not only violated federal regulations, but "also violated the public policy of North Carolina. N.C.G.S. 20-384 provides that the Division of Motor Vehicles may promulgate highway safety rules[.]" Coman, 325 N.C. at 176, 381 S.E.2d at 447. The Court cited a series of statutes enacted to carry out the public policy of our state to protect the safety of our highways that the defendant's alleged conduct violated.

The plaintiffs in Amos alleged in their complaint that the defendant-employer had discharged the plaintiffs for refusing to work for less than the statutory minimum wage in violation of North Carolina public policy as set forth in N.C. Gen.Stat. § 95-25.3. Our Supreme Court determined that the plaintiffs' complaint established a cause of action for wrongful discharge as the defendant's alleged conduct had violated the public policy when the defendant discharged the plaintiffs "in contravention of express policy declarations contained in the North Carolina...