Flower v. TRA Industries, Inc., 22765-1-III.

• Decision Date: 29 March 2005
• Docket Number: No. 22765-1-III.,22765-1-III.
• Citation: 111 P.3d 1192,127 Wash.App. 13
• Parties: Wesley C. FLOWER, Appellant, v. T.R.A. INDUSTRIES, INC., a Washington Corporation, d/b/a Huntwood Industries, Inc.; Tim Hunt and Jane Doe Hunt, and the marital community thereof, Respondents.
• Court: Washington Court of Appeals

111 P.3d 1192

127 Wash.App. 13

Wesley C. FLOWER, Appellant, v. T.R.A. INDUSTRIES, INC., a Washington Corporation, d/b/a Huntwood Industries, Inc.; Tim Hunt and Jane Doe Hunt, and the marital community thereof, Respondents.

No. 22765-1-III.

Court of Appeals of Washington, Division 3, Panel Four.

March 29, 2005.

Publication Ordered May 12, 2005.

Burke D. Jackowich, Michael James Hines, Attorneys at Law, Spokane, WA, for Appellant.

John Ray Nelson, Foster, Pepper & Shefelman PLLC, Spokane, WA, for Respondents.

SCHULTHEIS, J.

¶ 1 Wesley Flower appeals the trial court's summary dismissal of his action against his former employer Huntwood Industries, Inc. (Huntwood) for breach of employment contract, promissory estoppel, and negligent misrepresentation. Because material issues of fact were presented concerning these matters, we reverse and remand. The denial of Mr. Flower's cross-motion for summary judgment on a specific contract issue, which he also appeals, was improperly denied. We therefore reverse that order and remand for entry of a judgment for the relief requested, together with double damages and attorney fees. Finally, the trial court abused its discretion by placing restrictions on Mr. Flower's discovery that permitted Huntwood to avoid its CR 30(b)(6) deposition. We therefore reverse its protective order.

FACTS

¶ 2 In March 2002, Tim Hunt, president of Huntwood, contacted Mr. Flower about a position with Huntwood, a cabinet manufacturer. In April, Huntwood paid for Mr. Flower, who was then living in Alabama, to travel to Huntwood offices in Arizona and Washington. At a dinner meeting, Mr. Hunt offered Mr. Flower a position as the director of dealer sales for Huntwood in Washington. In a previous sales position with a cabinet maker that he had relocated to take, Mr. Flower's sales position had been eliminated when the management had changed after a buyout. Mr. Flower made clear his reluctance to relocate without a secure, long-term future with Huntwood. Mr. Hunt assured Mr. Flower that his biggest fault was keeping employees rather than letting them go, even if they underperformed, and Mr. Flower would not be discharged without just cause or anything short of serious misconduct. Mr. Hunt wrote down some of the details of his offer of employment to Mr. Flower on Huntwood stationery including salary over a three-year period ($100,000 for the first year, $110,000 the second, and $120,000 the third year); a $10,000 signing bonus; a moving allowance; medical coverage; car allowance; three weeks' vacation for the first year; one weeks' paid leave for the move; and a bonus program subject to further discussions.

¶ 3 Mr. Flower returned home and discussed the move with his family. Over the next week, Mr. Flower received phone calls and letters from other Huntwood employees encouraging him to accept the offer. Mr. Flower accepted in mid-April 2002, in a telephone conversation with Mr. Hunt. After he accepted his position, Mr. Flower sold his home in Alabama and prepared to move his family. His daughter turned down a scholarship at a private East Coast school to move with the family. Mr. Flower enrolled his daughter at Gonzaga University. He consulted a builder for a house and signed a six-month lease on an apartment.

¶ 4 Mr. Flower started work on May 13, 2002. Mr. Flower received a number of employment documents that he signed on that date. Among those was an "Employee Receipt and Acknowledgment of Employee Handbook." Clerk's Papers (CP) at 277. By signature of the document, the employee acknowledged receipt of a copy of the employee handbook and the employee's understanding that (1) the policies, practices, or benefits within the handbook could be changed by Huntwood at any time; (2) the employee was employed "at-will" and could be terminated at any time, for any reason or no reason, with or without notice; and (3) the employee had no contract, expressed or implied, with Huntwood that would change the "at-will" relationship. CP at 277. Based on the prior assurances to the contrary, Mr. Huntwood did not believe that the at-will provisions applied to him.

¶ 5 On June 4, 2002, Mr. Flower met with Mr. Hunt. Together they reviewed a document handwritten by Mr. Hunt captioned "Terms of employment." CP at 271. Mr. Hunt asked Mr. Flower, in exchange for a guaranty that he would not be fired for anything short of serious misconduct, to agree to repay the moving expenses if Mr. Flower decided to leave within two years of his hire. They ultimately agreed to reimbursement if Mr. Flower left within one year. Mr. Hunt made that change to the document and initialed it. The terms of employment also included the matters the parties discussed on the first meeting concerning salary over a three-year period; medical coverage; car allowance; three weeks' vacation for the first year; one weeks' paid leave for the move; and a bonus program subject to further discussions. The document also provided for the $10,000 signing bonus and $10,000 for moving expenses. The bonus was to be reduced by any amount of moving expenses over $10,000.

¶ 6 Approximately one month after starting work, Mr. Flower asked for a meeting with Mr. Hunt. He asked whether Mr. Hunt was satisfied with his performance. Mr. Hunt told him that he was doing fine.

¶ 7 On July 17, 2002, Mr. Hunt called Mr. Flower into the office and terminated him from his position as director of dealer sales. Mr. Hunt mentioned the possibility of giving Mr. Flower an area to work as an independent sales agent. He refused to pay Mr. Flower the $10,000 signing bonus.

¶ 8 Mr. Flower filed suit alleging breach of contract, promissory estoppel, violations of wage statutes, and negligent misrepresentation. Huntwood answered with a denial of the claims. It counterclaimed for breach of contract and conversion alleging Mr. Flower failed to repay expenses and had misappropriated company funds.

¶ 9 Mr. Flower took Mr. Hunt's deposition. Later that day, Mr. Flower noted a CR 30(b)(6) deposition of Huntwood. Two weeks before the scheduled deposition, Huntwood designated Mr. Hunt as its CR 30(b)(6) representative. Then Huntwood refused to make Mr. Hunt available because his deposition had already been taken. Huntwood moved for a protective order. The trial court granted the motion. The judge limited Mr. Flower's discovery of Huntwood to requests for admission and interrogatories. It allowed him to renew his request for a CR 30(b)(6) deposition if he was not able to obtain the information he sought with the limitations.

¶ 10 Huntwood moved for summary dismissal of Mr. Flower's claims. Mr. Flower filed a cross-motion regarding the $10,000 signing bonus. The trial court granted Huntwood's motion for summary judgment and denied Mr. Flower's cross-motion. Huntwood voluntarily dismissed its counterclaims. Mr. Flower appeals the summary dismissal and denial of his cross-motion as well as the imposition of discovery limitations.

ANALYSIS

1. Summary dismissal

¶ 11 "A motion for summary judgment may be granted only if, `after viewing all the pleadings, affidavits, depositions, admissions and all reasonable inferences drawn therefrom in favor of the nonmoving party', the trial court finds, `(1) that there is no genuine issue as to any material fact, (2) that all reasonable persons could reach only one conclusion, and (3) that the moving party is entitled to judgment as a matter of law.'" Higgins v. Stafford, 123 Wash.2d 160, 168-69, 866 P.2d 31 (1994) (quoting Peterick v. State, 22 Wash.App. 163, 180-81, 589 P.2d 250 (1977), overruled on other grounds by Stenberg v. Pac. Power & Light Co., 104 Wash.2d 710, 709 P.2d 793 (1985)

). After the moving party has produced evidence showing that no factual dispute exists that might affect a trial's outcome, the burden shifts to the nonmoving party to set forth facts showing that there is a genuine issue of material fact. Greater Harbor 2000 v. City of Seattle, 132 Wash.2d 267, 279, 937 P.2d 1082 (1997). We review summary judgments de novo, viewing all facts and reasonable inferences in the light most favorable to the nonmoving party. Hubbard v. Spokane County, 146 Wash.2d 699, 706-07, 50 P.3d 602 (2002).

¶ 12 As a preliminary matter, Huntwood claims that Mr. Flower has no right of action because he was not discharged; he quit rather than accept a different position. Huntwood asserts that there is no right of action for "wrongful transfer." See White v. State, 131 Wash.2d 1, 929 P.2d 396 (1997)

. However, as Mr. Flower points out, Mr. Hunt testified that he fired Mr. Flower. Then, after discharging him, Mr. Hunt did not offer him another position of employment with the company. Rather, he made a vague offer by asking "if he was interested [in representing Huntwood] in the east [United States] on commission or something like that." CP at 477. Mr. Flower contends that this is a position of an independent contractor rather than an employee. See Kamla v. Space Needle Corp., 147 Wash.2d 114, 119, 52 P.3d 472 (2002) (quoting RESTATEMENT (SECOND) OF AGENCY §§ 2(2), 2(3) (1958)). Viewing the evidence in the light most favorable to Mr. Flower, he has, at a minimum, presented a genuine issue of fact as to whether he was terminated.

¶ 13 We now examine the parties' contractual relationship. An employment contract that is indefinite as to duration is terminable at will by either the employer or employee. Thompson v. St. Regis Paper Co., 102 Wash.2d 219, 223, 685 P.2d 1081 (1984); Winspear v. Boeing Co., 75 Wash.App. 870, 876, 880 P.2d 1010 (1994). However, such an agreement is terminable by the employer only for cause if (1) there is an expressed or implied agreement to that effect, or (2) the employee gives consideration in addition to the contemplated service. Thompson, 102 Wash.2d at 223, 685 P.2d 1081; Winspear, 75 Wash.App. at 880-81, 880 P.2d 1010.

¶ 14 "Employment contracts are governed by the same rules as other contracts." Kloss v. Honeywell, Inc., ...