D'Angelo v. Gardner

• Decision Date: 24 October 1991
• Docket Number: Nos. 20452,19697,s. 20452
• Parties: , 123 Lab.Cas. P 57,099, 6 IER Cases 1545, 1993 O.S.H.D. (CCH) P 30,083 Don D'ANGELO, Appellant, v. Sue GARDNER, Gemco, a division of Lucky Stores, Inc., and Lucky Stores, Inc., Respondents. WESTERN STATES MINERALS CORP., a Utah Corporation, Appellant, v. Robert C. JONES and Gail A. Jones, husband and wife, Respondents.
• Court: Nevada Supreme Court

Page 206

819 P.2d 206

107 Nev. 704, 123 Lab.Cas. P 57,099,

6 IER Cases 1545,

1993 O.S.H.D. (CCH) P 30,083

Don D'ANGELO, Appellant, v. Sue GARDNER, Gemco, a division of Lucky Stores, Inc., and Lucky Stores, Inc., Respondents.

WESTERN STATES MINERALS CORP., a Utah Corporation, Appellant, v. Robert C. JONES and Gail A. Jones, husband and wife, Respondents.

Nos. 20452, 19697.

Supreme Court of Nevada.

Oct. 24, 1991.

[107 Nev. 705] Eva Garcia, Las Vegas, for appellant Don D'Angelo.

Smith & Kotchka, Las Vegas, for respondents Sue Gardner, GEMCO and Lucky Stores, Inc.

E. Pierre Gezelin, Reno, Davis, Graham & Stubbs and Steven J. Merker and Richard A. Westfall, Denver, Colo., for appellant Western States Minerals Corp.

Robert H. Perry and Janet J. Berry, Reno, for respondents Robert C. Jones and Gail A. Jones.

Lionel Sawyer & Collins and Brian McKay, Las Vegas, Laxalt & Nomura, McDonald, Carano, Wilson, McCune, Bergin, Frankovich & Hicks, Raggio, Woster & Lindell, Vargas & Bartlett, Woodburn, Wedge & Jeppson, Reno, for amici curiae.

Hamilton & Lynch, Reno, for amicus curiae, Nevada Trial Lawyers Ass'n.

Jones, Jones, Close & Brown and Charles H. McCrea, Sr., Las Vegas, for amicus curiae Southwest Gas Corp.

Thorndal, Backus, Maupin & Armstrong, Las Vegas, for amici curiae REECo, EG & G and EMI.

OPINION ¹

SPRINGER, Justice:

Having allowed rehearing and argument in regard to the above-captioned matters, the court now issues the following consolidated opinion and decision with regard thereto.

D'ANGELO v. GARDNER, ET AL., DOCKET NO. 20452

This is a wrongful discharge case. ² GEMCO claims that D'Angelo is an at-will employee and that he was subject to dismissal at any time without cause. D'Angelo claims that he is not subject to at-will termination but must, rather, be terminated only in accordance with the contract of the parties as evidenced by the handbook and in other ways.

This appeal comes to us on a summary judgment which holds, in effect, that D'Angelo was an at-will employee as a matter of law. Because there are issues of fact that bear on the nature of D'Angelo's employment contract, we reverse the summary judgment.

In Southwest Gas Corp. v. Ahmad, 99 Nev. 594, 668 P.2d 261 (1983), a case very similar ³ to this one, we affirmed a summary judgment while recognizing that contractual obligations can be implicit in employer practices and policies as reflected in an employee handbook. When an employer issues an employee handbook containing termination provisions and the employee has "knowledge of the pertinent provisions therein," this "supports an inference that the handbook formed part of the employment contract of the parties." 99 Nev. at 595, 668 P.2d at 261. ⁴ In the case before us the employer issued a handbook containing provisions relating to termination of employment for cause, and delivered one of these handbooks to D'Angelo, who read and "acknowledged" its contents. These facts, as they did in Ahmad, support an inference that the termination provisions were part of the employment contract. In the face of such inference summary judgment should not have been granted.

In conformance with Ahmad, we must agree with D'Angelo that he should not be foreclosed by summary judgment from trying to establish what we have recently termed a "contractual obligation of continued employment." ⁵ The relationship of an employer and employee may be such that the employer has a contractual obligation not to discharge the employee without first abiding by conditions relating to dismissal which are either expressly agreed upon by the parties or inferable from the dealings and practices of the parties. There is evidence to support this kind of employer-employee relationship in this case.

D'Angelo was employed by GEMCO as a salesman. Twelve years after he was hired, D'Angelo had risen to the position of department manager, employed in the East Sahara store in Las Vegas. In May of 1985, an incident occurred in which D'Angelo D'Angelo learned of the grounds for his termination when he saw a copy of GEMCO's letter to the state labor commissioner stating that D'Angelo had been terminated "for violation of work rule number 6, 'accepting or extending unauthorized discounts or credit to anyone.' " GEMCO's letter to the labor commissioner added: "As noted in the Handbook, which Mr. D'Angelo has read and acknowledged understanding of, deviation from this rule is considered most serious by the company and proper cause for discharge."

was accused of selling some film regularly priced at $3.97 a roll for $2.00 a roll. D'Angelo explained that he did this because the film date had expired. The outcome of this incident was that D'Angelo was terminated from his employment.

The foregoing language would lead one to believe that since both GEMCO and D'Angelo "acknowledged understanding" of the employee handbook, they may well have considered themselves, to some extent at least, bound by the terms of the handbook. GEMCO's written specification of charges given to the labor commissioner, although taken from the handbook, does not of itself establish the binding effect of the handbook because, even in the discharge of at-will employees, an employer may, in reporting to the labor commissioner, be called upon to specify the cause for dismissal ⁶; however, GEMCO's reference to the handbook, the proclaimed "understanding" of the parties relative to the handbook, and GEMCO's reference to a rule violation taken from the handbook as being the cause of D'Angelo's dismissal, all tend to lead to the conclusion that the employment relationship was defined by the handbook and that both parties considered themselves bound by the handbook with reference to termination rights and processes.

At the time of his hiring, and as a condition of his being hired, D'Angelo was required to read and acknowledge his understanding of the employee handbook. The handbook deals with the subject of discharge and, in addition to referring to "proper cause" for dismissal, sets out in some detail the "primary reasons which are considered by GEMCO as grounds for discharge "; and "any discharge based on an employee's failure to perform work as required" must be "preceded by written notice to the employee." ⁷ (Our emphasis). A jury could have concluded that both employer and employee intended to be bound by the terms of the handbook; but the jury could, of course, have concluded otherwise and decided in favor of GEMCO. The jury could have seen the handbook (as does the dissent) as a mere convenience to the employee and as a precatory expression of employment "policies intended to benefit employees," which was binding on the employee but not on the employer.

Just as there are cases in which handbooks and employment practices can be found to support an express or implied obligation of continued employment, so are there cases in which such an obligation is absent as a matter of law. This was the situation in our recent case of Vancheri v. GNLV Corp., 105 Nev. 417, 777 P.2d 366 (1989). In Vancheri, although there was an employee handbook, the handbook did not contain employee disciplinary procedures or specification of "proper cause" for dismissal (see Vancheri, 105 Nev. at 422 n. 2, 777 P.2d at 369 n. 2); thus, Mr. Vancheri could not rely on a handbook to support a claim on his part that his employer owed to him a contractual obligation of continued employment. Absent termination provisions in the handbook, we held in Vancheri that the mere existence of customary or informal procedures employed in cases of In Vancheri, there was an established and customary disciplinary procedure that was ordinarily followed by the employer, but this procedure was gratuitous and unilateral and was not reduced to writing or incorporated in a handbook that was delivered to the employee and "acknowledged" by the employee. We said in Vancheri that the mere establishment of such procedures by an employer would not "in and of itself" create an obligation of continued employment. Such procedures, unilaterally installed, do not create the right of continued employment.

employee dismissal would not vitiate an essentially at-will employment.

Mr. Vancheri failed, as a matter of law, to establish an agreement, express or implied, between his employer and him, that granted to him the right of continued employment. By contrast, as pointed out above, there is in the case before us ample evidence under our ruling in Ahmad "to support an inference" of the existence of an obligation of continued employment; and the granting of summary judgment to the employer in this case was in contravention of our holding in Ahmad. The language relating to termination contained in the employee-accepted GEMCO handbook, taken with the fact that D'Angelo's discharge was based on a handbook rule violation, would support a fact finder's conclusion that the employer was contractually bound to the employee under an obligation of continued employment.

Summary judgment is reversed; and the matter is remanded for trial on the merits of the wrongful discharge claims.

WESTERN STATES MINERALS CORP. v. JONES, DOCKET NO. 19697

This is a wrongful termination of employment case. Respondent Robert C. Jones sued his employer, appellant Western States Minerals Corporation, in contract and tort because of the manner in which Western States terminated Jones's employment. The trial jury awarded Jones by general verdict $62,287.00 in past damages, $98,863.00 in future damages and $100,000.00 in punitive damages. We affirm the judgment of the trial court on the general verdict and hold that the evidence supports an award of contract damages and of tort damages, compensatory and punitive, for tortious discharge. We deny Jones's tort claim for breach of the implied covenant of good faith and fair dealing and decline any consideration of the assignment of error relating to the claim for infliction of emotional distress because it is not...