Epps v. NCNB Texas Nat. Bank

• Decision Date: 11 March 1993
• Docket Number: Civ. A. No. 3-92-CV-0509-H.
• Citation: 838 F. Supp. 296
• Parties: David O. EPPS, Plaintiff, v. NCNB TEXAS NATIONAL BANK, Defendant.
• Court: U.S. District Court — Northern District of Texas

838 F. Supp. 296

David O. EPPS, Plaintiff, v. NCNB TEXAS NATIONAL BANK, Defendant.

Civ. A. No. 3-92-CV-0509-H.

N.D. Texas, Dallas Division.

March 11, 1993.

COPYRIGHT MATERIAL OMITTED

James L. Hicks, Jr., Hicks & Associates, Dallas, TX, for plaintiff.

William C. Strock, Jill J. Weinberg, Haynes & Boone, Dallas, TX, for defendant.

MEMORANDUM OPINION AND ORDER

SANDERS, Chief Judge.

Before the Court are Defendant's Motion for Summary Judgment, filed December 7, 1992; Plaintiff's Response, filed January 11, 1993; and Defendant's Reply, filed January 26, 1993.

I. Background

This suit involves an alleged breach of contract and attendant ERISA issues. In June of 1989, Plaintiff David O. Epps left his career as a self-employed Certified Public Accountant to become a Senior Vice President and Division Manager for NCNB Texas National Bank ("Bank").¹ Before Epps accepted the Bank's offer of employment, Epps and the Bank entered into a severance agreement which provided for severance pay to extend over a period of time if Epps' employment with the Bank ceased under certain conditions. Specifically, the severance agreement stated that "if Epps should cease to be employed by the Bank for any reason other than termination for cause or voluntary termination, the Bank will pay severance on the following basis...."

In August of 1991, Plaintiff's job responsibilities changed. Plaintiff then informed the Bank that he was not pleased with his new responsibilities and stated that he believed that this change triggered the severance agreement. When the Bank declined to honor the agreement, Epps left his employment with the Bank for another position at a competing Bank. The principal question presented to the Court in this suit is whether the events which have occurred trigger the Bank's duty to honor its obligations under the severance agreement and entitle Epps to the benefit of that contract.²

The Bank has moved for summary judgment, contending that the severance agreement is plainly inapplicable. Plaintiff, however, asserts that summary judgment is inappropriate, arguing that the agreement is ambiguous and that a trial is required to determine a proper understanding of the intent of the parties.

II. Analysis

"Summary judgment reinforces the purpose of the Rules, to achieve the just, speedy, and inexpensive determination of actions, and, when appropriate, affords a merciful end to litigation that would otherwise be lengthy and expensive." Fontenot v. Upjohn Co., 780 F.2d 1190, 1197 (5th Cir.1986).

Summary judgment is proper when the pleadings and evidence on file show that no genuine issue exists as to any material fact and that the moving party is entitled to judgment or partial judgment as a matter of law. See Fed.R.Civ.P. 56. Before a court may grant summary judgment, the moving party must demonstrate that it is entitled to judgment as a matter of law because there is no actual dispute as to an essential element of the nonmovant's case. See Topalian v. Ehrman, 954 F.2d 1125 (5th Cir.), cert. denied, ___ U.S. ___, 113 S.Ct. 82, 121 L.Ed.2d 46 (1992). The threshold inquiry, therefore, is "whether ... there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). Of course, "the substantive law will identify which facts are material." Id. at 248, 106 S.Ct. at 2510.

The Supreme Court has explained that a movant for summary judgment need not support the motion with evidence negating the opponent's case; rather, once the movant establishes that there is an absence of evidence to support the non-movant's case, the burden is on the non-movant to make a showing sufficient to establish an issue of fact for each element as to which that party will have the burden of proof at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-25, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986).

Once the moving party shows that it is entitled to summary judgment, the burden shifts to the nonmoving party to "come forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986) (emphasis in original) (quoting Rule 56(e)); see also Fontenot, 780 F.2d at 1195-98. A party must do more than simply show some "metaphysical doubt as to the material facts." Matsushita, 475 U.S. at 586, 106 S.Ct. at 1355. Stated another way, "if the record, taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Friou v. Phillips Petroleum Co., 948 F.2d 972, 974 (5th Cir.1991) (citing Matsushita, 475 U.S. at 587, 106 S.Ct. at 1356). However, all of the evidence must be viewed in the light most favorable to the motion's opponent. Gremillion v. Gulf Coast Catering Co., 904 F.2d 290, 292 (5th Cir.1990).

In its consideration of the motion for summary judgment, the Court relies on the following facts:

1) In early 1983, RepublicBank, a predecessor of the Bank, created a specialized Insurance Division designed to provide credit and non-credit financial services to select mid-sized insurance companies. See Swiley Affidavit at ¶ 4.

2) In 1989, Plaintiff became a candidate for the Insurance Division Manager position, a management and marketing post. At the time, Plaintiff, who had been employed for a number of years in the insurance industry, had his own CPA practice in Dallas. See id. at ¶ 5.

3) During the hiring process, Plaintiff expressed to John Dienes and Thomas Swiley, two officials of the Bank, his concern that the Bank might later decide to withdraw from or curtail its insurance lending business and thus effectively shut down the insurance lending functions of the Bank and eliminate the position for which Plaintiff was being considered. See Epps Affidavit at 3-4. Therefore, Plaintiff requested a contract which provided for severance benefits should he be discharged without cause from employment with the Bank.

4) The parties eventually negotiated a contract of employment which included a severance agreement. In a letter addressed to Plaintiff, the Bank offered to hire Plaintiff as a "Senior Vice President and Division Manager" at a salary of $95,000 per year. The offer of employment also included a severance agreement. The severance agreement stated in relevant part:

Recognizing the risk you accept in leaving your own business, we also offer you this special severance package. If you should cease to be employed by NCNB Texas for any reason other than termination for cause or voluntary termination we will pay you severance on the following basis.

See Swiley Affidavit at Ex. 1 (emphasis added). Plaintiff accepted the Bank's offer of employment on April 5, 1989 and began work on June 16, 1989. The parties agree that this contract constitutes the final agreement of the parties. See Epps Deposition at 24-25. The parties also agree that this contract does not spell out Plaintiff's job duties.

5) Defendant notes that Plaintiff's initial job responsibilities included marketing, extending, and managing credit to primarily mid-sized companies in the insurance industry as well as cross-selling other non-credit services including trust and cash management. See Swiley Affidavit at ¶ 10; Epps Deposition at 25-6.

6) Defendant states that after it suffered credit problems with two of its accounts in the insurance division and because of other economic concerns, the Bank decided to become "more selective" in its insurance lending activities. Thus, in July of 1991, the Bank issued a new policy on lending to the insurance industry which made loans more difficult to obtain. Moreover, the Bank decided to liquidate much of the Insurance Division's loan portfolio. See Swiley Affidavit at ¶ 11-13.

7) Defendant reports that, because the level of new business was to be reduced, it decided to cut the size of its insurance lending staff. An assistant to Plaintiff was told to seek employment elsewhere, and other employees in the division were transferred to other areas of the Bank. One woman, Jennifer Olson, continued to work with Plaintiff for a period of time, but she too was eventually transferred out of the Insurance Division.

8) Plaintiff explains that in July of 1991, he was informed that the Bank was going to "discontinue" its lending activity in the insurance industry and that the Bank wanted him to dispose of the existing portfolio of insurance credits. Plaintiff says that Swiley and Dienes informed him that they wanted him to remain at the Bank and dispose of the existing portfolio, which they hoped could be completed within a year. Plaintiff reports that he received the Bank's formal credit guidelines for loans to the insurance industry shortly thereafter. Plaintiff claims that the guidelines were so restrictive that the Bank's ability to market insurance loans effectively "ceased to exist." See Epps Affidavit at 5-6.

9) Plaintiff also reports that since the Bank effectively ceased making loans in the insurance industry and transferred or terminated the employees who Plaintiff supervised, he was left without any of his original job duties to perform. As a result, Plaintiff had little, if anything, to do and, on more than one occasion, asked Swiley what the bank wanted him to do. See id. at 6-7.

10) Plaintiff states that on August 16, 1991, he met with Bank officials who informed him that he was being assigned new job duties. Plaintiff reports that his new position, "Insurance Specialist", was a technical staff support position which did not involve either management or marketing responsibilities. See id. at 7.³

At the August 16, 1991 meeting, Plaintiff received a memo which detailed his new job responsibilities. See id. at Ex. E. These duties included, among other things,...