Decker v. Browning-Ferris Industries of Colorado, Inc.

• Decision Date: 12 January 1995
• Docket Number: No. 93CA1427,BROWNING-FERRIS,93CA1427
• Citation: 903 P.2d 1150
• Parties: Thomas H. DECKER, Plaintiff-Appellee, v.INDUSTRIES OF COLORADO, INC., Defendant-Appellant. . IV
• Court: Colorado Court of Appeals

Page 1150

903 P.2d 1150

Thomas H. DECKER, Plaintiff-Appellee, v. BROWNING-FERRIS INDUSTRIES OF COLORADO, INC., Defendant-Appellant.

No. 93CA1427.

Colorado Court of Appeals,

Div. IV.

Jan. 12, 1995.

Rehearing Denied March 16, 1995.

Certiorari Granted Oct. 2, 1995.

Cross-Petition for Writ of

Certiorari Denied Oct. 2, 1995.

Rehearing Denied Dec. 11,

1997.*

Stefan Kazmierski, Littleton, for plaintiff-appellee.

John N. McNamara, Jr., P.C., John N. McNamara, Baker & Hostetler, James A. Clark, Kathryn A. Elzi, Denver, for defendant-appellant.

Feiger, Collison & Killmer, P.C., Gilbert M. Roman, Denver, for amicus curiae Nat. Employment Lawyers Ass'n.

Opinion by Judge CASEBOLT.

In this wrongful termination of employment suit, defendant, Browning-Ferris Industries of Colorado, Inc. (BFI), appeals the judgment entered upon a jury verdict awarding damages to plaintiff, Thomas H. Decker. We affirm in part and reverse in part.

Decker was employed by BFI, beginning in 1985, first as a crew member and then as a trash truck driver in its Aspen, Colorado, location. In early 1991, a new general manager for that location was installed. In August of 1991, the new general manager for BFI fired Decker, allegedly for working too slowly.

Decker brought this wrongful termination suit against BFI asserting that he had been discharged in violation of an alleged progressive discipline policy and that BFI had breached an express covenant of good faith and fair dealing in terminating his employment. Decker sought damages under a contract claim, tort damages for breach of the express covenant of good faith, and punitive damages under the alleged tort claim.

At trial, BFI stipulated that it promised fair treatment to its employees, but denied any impropriety in its treatment of Decker.

After trial, the jury awarded Decker $600,000 for lost income, $80,000 in noneconomic damages for breach of the good faith covenant, and $680,000 in punitive damages predicated upon breach of the covenant.

I.

BFI's first contention is that the trial court erred by refusing to admit evidence, acquired after Decker was terminated, which allegedly established that Decker lied about his criminal record on his employment application. We disagree.

In 1984, Decker was charged in Texas with a misdemeanor count of possession of cocaine. Under a deferred prosecution, Decker entered a plea of guilty to the charge; however, he successfully completed the deferred prosecution period, the guilty plea was withdrawn, the misdemeanor charge was dismissed, and his record was expunged, all prior to submitting his employment application to BFI.

BFI's employment application asked whether Decker had "ever been convicted of a felony or a misdemeanor involving moral turpitude (e.g. theft?)" to which Decker answered "No." After BFI terminated Decker's employment, Decker revealed the charge in interrogatory answers and in his deposition, at that time mistakenly characterizing the charge as a felony. BFI denied having any previous knowledge of the charge.

BFI then asserted a defense of fraud in the inducement and filed a motion for summary judgment on Decker's claims based on that defense and upon the doctrine of after-acquired evidence. Decker, in turn, filed a motion in limine seeking to exclude any evidence of this prior charge.

BFI argued that the evidence should be admitted because BFI would not have hired Decker, or would have immediately terminated his employment, had it learned about the drug charge. Accordingly, BFI contended, Decker was not entitled to recover any damages for termination of his employment. BFI also sought admission of the evidence on the grounds that it was relevant to whether Decker had dealt fairly with BFI under the covenant of good faith and fair dealing.

The trial court denied the motion for summary judgment and granted Decker's motion in limine, excluding all after-acquired evidence of the drug charge. It concluded that, in light of the disposition of the charge, Decker had been truthful on his application. In addition, the trial court concluded that, to the extent the evidence was relevant, its probative value was substantially outweighed by the danger of unfair prejudice under CRE 403; hence, the trial court also excluded the evidence for that reason.

A trial court is afforded considerable discretion in passing upon the admission or exclusion of evidence, especially when weighing its probative value and prejudicial effect. Its ruling will not be disturbed on appeal absent an abuse of that discretion. Hock v. New York Life Insurance Co., 876 P.2d 1242 (Colo.1994). A trial court abuses its discretion only when its evidentiary ruling is manifestly arbitrary, unreasonable, or unfair. People v. Milton, 732 P.2d 1199 (Colo.1987).

A.

BFI contends that the proffered evidence was relevant to prove its defense of fraud in the inducement. Under the circumstances at issue, we disagree.

In Weber v. Colorado State Board of Nursing, 830 P.2d 1128 (Colo.App.1992), a division of this court concluded that, following successful completion of a deferred judgment, there no longer exists a plea of guilty to a felony and there never existed a judgment of conviction. That reasoning provides persuasive support for the trial court's finding here that Decker did not lie on his application. Such factual findings will not be disturbed on review if, as here, they are supported in the record. Pomeranz v. McDonald's Corp., 843 P.2d 1378 (Colo.1993).

The trial court's determination that Decker was truthful in his application negates the relevance of the evidence for purposes of a fraud in the inducement defense. In order for such a defense to succeed, the evidence must show that Decker made a false statement of fact or concealed a past or present fact which he had a duty to disclose. See Murray v. Montgomery Ward Life Insurance Co., 196 Colo. 225, 584 P.2d 78 (1978).

In light of the Weber holding and the trial court's finding, Decker neither made a false statement, nor was he obligated to disclose the previous charge since it did not constitute a "conviction." Hence, we find no abuse of discretion in the court's ruling relevant to the fraud in the inducement defense.

B.

BFI next contends that the evidence was relevant under the doctrine of "after-acquired evidence." Again, under these circumstances, we disagree.

The "after-acquired evidence" doctrine stems from the decision in Summers v. State Farm Mutual Automobile Insurance Co., 864 F.2d 700 (10th Cir.1988). There, an employee was fired for generally unsatisfactory work performance. Several years later during the course of discovery in the employee's wrongful termination of employment suit, State Farm discovered that the employee had falsified records. In affirming summary judgment for State Farm, the court held that even though the falsifications discovered after termination of employment were not the original basis for the firing, they were nevertheless admissible in determining what relief, if any, should be afforded the employee. See also McKennon v. Nashville Banner Publishing Co., 9 F.3d 539 (6th Cir.1993), cert. granted, 511 U.S. 1106, 114 S.Ct. 2099, 128 L.Ed.2d 661 (1994).

The court in Summers further held that an employee cannot recover under any theory when the after-acquired evidence would have resulted in termination of the employment relationship if it had been known at the time of the firing.

This doctrine has not been addressed by Colorado appellate courts and we need not decide here whether it should be made part of Colorado law because, under the circumstances of this case, it would not be available. Here, BFI offered an affidavit from its former manager that indicated he would not have hired Decker, or alternatively, would have fired Decker if he had known that Decker had "pled guilty to a felony."

But, as noted above, since the charge against Decker was a misdemeanor, the former manager's affidavit does not establish that the evidence would be admissible on the issue of pleading guilty to a felony. Consequently, we perceive no abuse of discretion by the trial court in refusing to admit the evidence by application of the "after-acquired evidence" doctrine.

C.

BFI finally asserts that the evidence was relevant on Decker's tort claim of breach of covenant of good faith and fair dealing. We are not persuaded.

In a discussion below, we hold that the trial court erroneously submitted Decker's tort claim to the jury. Accordingly, evidence of Decker's alleged breach of such a covenant, even if established, would be without significance.

Hence, we affirm the trial court's exclusion of this evidence. People v. Aldrich, 849 P.2d 821 (Colo.App.1992).

II.

BFI next contends that the trial court erred in allowing Decker to present testimony regarding the existence and contents of the alleged progressive discipline policy. Again, we perceive no error.

The policy, which BFI claimed did not exist, was purportedly contained in a writing issued to employees. No original or copy of any such policy was introduced at trial, nor was it produced by either side during discovery.

Relying upon Walker v. Drogmund, 101 Colo. 521, 74 P.2d 1235 (1937) and People v. Heckers, 37 Colo.App. 166, 543 P.2d 1311

(1975), BFI claims that secondary evidence of the contents of a writing must be clear and convincing, a standard not met here. We disagree.

The vitality of Walker and Heckers for the proposition that "clear and convincing" evidence of the contents of a writing is necessary has been significantly undercut by the adoption of § 13-25-127, C.R.S. (1987 Repl.Vol 6A). That statute establishes a "preponderance of the evidence" burden of proof in civil actions. See Gerner v. Sullivan, 768 P.2d 701 (Colo.1989) (preponderance of the evidence standard applies to any civil action except those specified in the statute).

In addition, § 13-25-113, C.R.S. (1987 Repl.Vol. 6A) further supports the admission of the...