Degen v. Investors Diversified Services, Inc.
| Decision Date | 14 July 1961 |
| Docket Number | No. 38159,38159 |
| Citation | 110 N.W.2d 863,260 Minn. 424 |
| Parties | , 117 L.R.R.M. (BNA) 2611 Harley A. DEGEN, Appellant, v. INVESTORS DIVERSIFIED SERVICES, INC., and Joseph M. Fitzsimmons, Respondents. |
| Court | Minnesota Supreme Court |
Syllabus by the Court
1. Evidence in support of plaintiff's contention that corporate defendant had entered into a lifetime employment contract which governed the term of his employment considered and held insufficient to establish such a contract.
2. In absence of other express or implied provisions fixing definite term for employment contract and where no considerations are involved other than services contracted to be performed by employee and salary to be paid therefor by employer, a contract for 'permanent employment' or for 'life employment' or for a term purporting to be 'permanent' is generally held to be a contract for an indefinite period, terminable at will of either of contracting parties.
3. Fact that plaintiff forbore seeking or accepting other employment, or at one time agreed to accept a salary reduction, would not form basis for bringing his case within exception to general rule above expressed. Rule in Skagerberg v. Blandin Paper Co., 197 Minn. 291, 266 N.W. 872, where like contentions were advanced and determined to be insufficient to establish that contract there was other than for an indefinite period terminable at will of either party, held applicable here.
Christensen, Johnson, O'Brien & Doherty, Minneapolis, for appellant.
Cant, Haverstock, Beardsley, Gray & Plant, Franklin D. Gray, Minneapolis, for respondents.
Action for breach of an alleged lifetime employment contract. Plaintiff contends that, under the depositions and exhibits submitted on defendants' motion for summary judgment, a fact issue was presented as to whether there was a valid, permanent lifetime employment contract between him and Investors Diversified Services, Inc., hereafter referred to as Investors; and as to whether termination of his employment contract was in violation of his contractual rights thereunder and under Investors' pension and retirement plan.
This appeal is from an order for summary judgment dismissing plaintiff's action. The order was based upon depositions of plaintiff and officers of Investors and upon certain correspondence and documentary evidence submitted. These disclose that plaintiff, an attorney at law, had been engaged in private practice in Iowa where he had been earning approximately $10,000 per year prior to his entry into military service; that he entered the employment of Investors on or about August 1, 1945, as assistant counsel at a salary of $7,200 per year; that nothing was then said as to any definite term of employment; that shortly thereafter Robert MacGregor, president of Investors who began work the same day, told him 'to consider this a career situation, and not * * * as * * * temporary employment'; that because Investors was not in sound financial condition at that time he had consented to a reduction in salary to $3,600 per year; that another official told him that he 'shouldn't look forward to anything else other than a long career with the company'; that by 1952 his original salary of $7,200 per year had been restored; and that prior to this he had considered changing his employment and had made application to Northwestern National Life Insurance Company and Northwestern Bell Telephone Company for employment. He asserts that after his salary had been nearly restored and he learned of Investors' retirement plan he determined to remain in its employment until he reached retirement age of 65; that during the period between 1948 and 1954 he was advised by officers of the company that he was doing a fine job and should 'stay with the ship' and look upon his employment as a 'career situation' and that he had a great future with the company.
Plaintiff received his last paycheck on April 30, 1957. In August 1956 he had asked for a vacation. At that time, Harold Bradford, his immediate superior, requested his resignation which he refused to give. During his vacation his office was taken over by another, and no work was thereafter given to him. Bradford again asked for his resignation but gave no reason therefor. He was not advised as to the reason for his discharge until some time after his employment had terminated.
The rules and procedures of Investors relative to discharge of employees provided for a preliminary discussion between an employee and his immediate superior and for a dismissal interview at which a member of the personnel department would be present before termination of employment; and also that a written report as to such preliminary discussion should become a part of the employee's personnel file at Investors. Plaintiff asserts that such procedures were not followed in terminating his employment.
Some time after plaintiff had commenced his employment with Investors, the latter established a retirement, incentive, and thrift plan to which plaintiff contributed, and which provided for certain retirement benefits for employees at the age of 65.
In a memorandum attached to its order granting defendants' motion for summary judgment, the trial court stated:
'This motion for summary judgment is disposed of, as the Court sees it, by the Minnesota case of Skagerberg v. Blandin Paper Co., 197 Minn. 291 (266 N.W. 872). The complaint of plaintiff indicates in paragraph III thereof that his claimed employment was a 'lifetime position;' paragraph V thereof, 'of the permanency of his position,' in effect sets forth a so-called hiring permanently. This is further augmented by plaintiff's brief, wherein it is stated as follows:
"Plaintiff contends in this case that, not only does he have a contract of employment with defendant I.D.S. (he was admittedly employed by it for over 11 years), but also a contract which can be termed a permanent or a continuous or a career contract of employment.'
'Likewise, in plaintiff's deposition throughout, starting with page 16, where he stated that after he was hired, the plaintiff testified MacGregor told him to consider it a 'career situation'; likewise on pages 21, 22, 23, on the last page of which, relating further to the conversation with MacGregor, the plaintiff states:
"He said I should look upon it as a lifetime situation.' Also pages 24, 28, 38, 46, 49, 50, 56 and 63.
'The Skagerberg case is well summed up in the first syllabus, which reads as follows:
"Where parties to a contract of service expressly agree that the employment shall be 'permanent,' the law implies, not that the engagement shall be continuous or for any definite period, but that the term being indefinite the hiring is merely at will.'
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