Conway v. Pacific University

Decision Date18 October 1994
Docket NumberNo. C,C
Citation129 Or.App. 307,879 P.2d 201
Parties, 94 Ed. Law Rep. 531, 9 IER Cases 1315 Patrick W. CONWAY, Respondent, v. PACIFIC UNIVERSITY, Appellant. 920640 CV; CA A80633.
CourtOregon Court of Appeals

Thomas M. Christ, Portland, argued the cause, for appellant. With him on the briefs, were Scott J. Meyer and Mitchell, Lang & Smith.

Bernard Jolles, Portland, argued the cause, for respondent. With him on the brief, were Evelyn M. Conroy and Jolles, Bernstein & Garone, P.C.

Before WARREN, P.J., and EDMONDS and LANDAU, JJ.

WARREN, Presiding Judge.

Defendant Pacific University (Pacific) appeals from a judgment for plaintiff in this action for negligent misrepresentation, arising out of negotiations for an employment contract. 1 We reverse.

Plaintiff was a professor at Central Oregon Community College (COCC), in a position that would eventually lead to tenure. He took a leave of absence from COCC to accept a temporary teaching job at Pacific University for the 1990-1991 academic year. In January, 1991, he applied for a permanent tenure track position at Pacific. In May, he was offered the position. He was concerned about whether poor student evaluations that he had received during his temporary assignment at Pacific would affect his ability to attain tenure there, because he already had a tenure track position at COCC, which he would have to give up to take the position at Pacific. Therefore, he asked the dean of the College of Arts and Sciences whether his poor student evaluations would affect his continued employment at the college or impede his path to tenure. The dean told him that the evaluations would not be a problem. As a result of that assurance, plaintiff resigned his position at COCC and accepted the position at Pacific.

His student evaluations did not improve during the first year in the tenure track position and instead grew increasingly worse. Based in large part on the evaluations, Pacific offered plaintiff only a "terminal" or nonrenewable contract for the following school year.

Plaintiff brought this action, alleging that the dean's assurance that the student evaluations would not affect his prospects for attaining tenure were negligent misrepresentations on which he relied to his detriment when he gave up his teaching position at COCC to take the tenure track position at Pacific. The jury returned a verdict for plaintiff on that claim.

Pacific assigns error to the trial court's denial of its motion to dismiss and motion for directed verdict. Pacific argued below and argues on appeal that plaintiff cannot recover for negligent misrepresentation, because the misrepresentation occurred during arm's length negotiations about the tenure track position, and under Onita Pacific Corp. v. Trustees of Bronson, 315 Or. 149, 843 P.2d 890 (1992), negligent misrepresentations made during arm's length negotiations are not actionable. Plaintiff argues that the relationship of employer and employee is a special relationship that gives rise to a duty of care by the employer.

In Oregon, "under some circumstances, one may be liable for economic loss sustained by others who rely on one's representations negligently made." Onita Pacific Corp. v. Trustees of Bronson, supra, 315 Or. at 159, 843 P.2d 890. Because the damage is purely economic, a claim for negligent misrepresentation "must be predicated on some duty of the negligent actor to the injured party beyond the common law duty to exercise reasonable care to prevent foreseeable harm." 315 Or. at 159, 843 P.2d 890. Plaintiff argues that the duty owed to him by Pacific was a result of the employer-employee relationship, 2 which he asserts created a relationship of trust and dependency. That relationship, he argues, entitled him to "at least reasonable care by [Pacific] to avoid misrepresenting the facts."

We have held that the employer-employee relationship is a special relationship for some purposes in tort law. In Bodewig v. K-Mart, Inc., 54 Or.App. 480, 635 P.2d 657 (1981), rev. den. 292 Or. 450, 644 P.2d 1128 (1982), we concluded that an employee could recover against her employer for reckless infliction of emotional distress. We reasoned that the employer has authority over the employee

"who, by the nature of the relationship, is subject to the direction and control of the employer and may be discharged for any or no reason, absent an agreement restricting that authority. Clearly, that relationship is not an arm's length one between strangers." 54 Or.App. at 486.

That same reasoning does not apply in the context of this case. As we explained in Ammons v. Jackson County, 119 Or.App. 181, 850 P.2d 376, rev. den. 318 Or. 24, 862 P.2d 1304 (1993), the Supreme Court in Onita recognized that only certain types of relationships will support a duty to prevent misrepresentations that cause solely economic harm:

"The common thread in the special relationships that the Supreme Court has recognized as giving rise to a duty of care to protect against purely economic loss is that the professional is acting, at least in part, to further the economic interests of the person to whom the duty is owed." 119 Or.App. at 184, 850 P.2d 376.

Whatever duty an employer may owe to an employee in other contexts of the employment relationship, we know of no duty of an employer to act to further the economic interests of the employee in the negotiation of the employment contract.

Plaintiff argues that this case is indistinguishable from Gish v. Douglas County, 109 Or.App. 84, 817 P.2d 1341 (1991), in which we reversed the trial court's dismissal of the plaintiff's negligent misrepresentation claim. In that case, the plaintiff alleged that she was employed by the City of Roseburg, and that a representative of the county made representations that caused her to resign from city employment and accept employment at the county. According to the allegations, the representations were false, she relied on them and she suffered harm when she lost her job with the county. We held that the plaintiff had stated a claim for negligent misrepresentation.

Although plaintiff is correct that the allegations in Gish bear much similarity to the facts of this case, Gish was decided before the Supreme Court's decision in Onita Pacific Corp. v. Trustees of Bronson, supra. We did not...

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7 cases
  • Dawson v. Entek Intern.
    • United States
    • U.S. District Court — District of Oregon
    • 26 Agosto 2009
    ...for emotional distress. McGanty v. Staudenraus, 321 Or. 532, 548, 901 P.2d 841 (1995). Plaintiff relies on Conway v. Pacific Univ., 129 Or.App. 307, 310, 879 P.2d 201 (1994) in asserting that an employee may recover against an employer for RIED. However, the Oregon Court of Appeals in Conwa......
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    • Minnesota Supreme Court
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    ...same cannot be said about the employer's relationship with a job applicant.”), rev. denied (Ariz. July 6, 1994); Conway v. Pac. Univ., 129 Or.App. 307, 879 P.2d 201, 203 (1994) (“Whatever duty an employer may owe to an employee in other contexts of the employment relationship, we know of no......
  • Conway v. Pacific University
    • United States
    • Oregon Supreme Court
    • 11 Octubre 1996
    ...position, and * * * negligent misrepresentations made during arm's-length negotiations are not actionable." Conway v. Pacific University, 129 Or.App. 307, 309-10, 879 P.2d 201 (1994). The Court of Appeals agreed with the university and concluded that, "in negotiating about a possible employ......
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    ...Gebrayel v. Transamerica Title Ins. Co., 132 Or.App. 271, 888 P.2d 83, rev. den. 321 Or. 47, 892 P.2d 1024 (1995); Conway v. Pacific University, 129 Or.App. 307, 879 P.2d 201, rev. allowed 320 Or. 272, 882 P.2d 1114 (1994).8 Our review of the record discloses that the trial court made no su......
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