Gassmann v. Evangelical Lutheran Good Samaritan Soc., Inc.

• Citation: 261 Kan. 725,933 P.2d 743
• Decision Date: 07 March 1997
• Docket Number: No. 74272,74272
• Parties: , 134 Lab.Cas. P 58,301, 12 IER Cases 1076 Peggy GASSMANN, Appellant, v. The EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY, INC., Appellee.
• Court: United States State Supreme Court of Kansas

Page 743

933 P.2d 743

261 Kan. 725, 134 Lab.Cas. P 58,301,

12 IER Cases 1076

Peggy GASSMANN, Appellant, v. The EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY, INC., Appellee.

No. 74272.

Supreme Court of Kansas.

March 7, 1997.

Syllabus by the Court

1. The after-acquired evidence doctrine in wrongful discharge cases in Kansas involving breach of implied contract and not raising public policy concerns is adopted. The employee is not entitled to any relief if the employer can establish after-acquired evidence sufficient for termination.

2. The record is reviewed in a wrongful discharge action, and it is held: Under the three-prong test of McKennon v. Nashville Banner Pub. Co., 513 U.S. 352, 115 S.Ct. 879, 130 L.Ed.2d 852 (1995), issues of material fact remain about whether (1) the plaintiff was guilty of some misconduct of which the employer was unaware; (2) the misconduct would have justified discharge; and (3) the employer would have discharged the plaintiff had the employer known of the misconduct.

Steven W. Hirsch, of Hirsch & Pratt, L.L.P., Oberlin, argued the cause, and Preston A. Pratt, of the same firm, was with him on the briefs, for appellant.

Christopher R. Hedican, of Berens & Tate, P.C., Omaha, NE, argued the cause, and Christopher E. Hoyme and Timothy M. Welsh, of the same firm, and Joseph W. Jeter, of Jeter and Moran, Hays, were with him on the briefs, for appellee.

SIX, Justice:

This case concerns application of the after-acquired evidence doctrine to a wrongful discharge case involving breach of implied contract and not raising public policy concerns. The district court granted defendant Evangelical Lutheran Good Samaritan Society, Inc.'s (Good Samaritan) motion for summary judgment against plaintiff Peggy Gassmann's petition for wrongful discharge, applying the after-acquired evidence doctrine. The doctrine had never been adopted by any Kansas appellate court. The Court of Appeals decided that the after-acquired evidence doctrine would apply but that material issues of fact remained about whether Gassmann was guilty of misconduct and whether her actions would have justified discharge. Gassmann v. Evangelical Lutheran Good Samaritan Society, Inc., 22 Kan.App.2d 632, 921 P.2d 224 (1996). We granted Good Samaritan's petition for review. Our jurisdiction is under K.S.A. 20-3018(b).

The questions for review are whether the after-acquired evidence doctrine is applicable in a wrongful discharge case and whether genuine issues of material fact exist concerning whether Gassmann's action was misconduct justifying discharge.

We adopt the after-acquired evidence doctrine and hold that material facts remain at issue, requiring remand to the district court.

FACTS

The facts set out by the Court of Appeals are:

"Good Samaritan is a corporation which owns and operates nursing homes in many states throughout the Midwest, one of which is the Decatur County Good Samaritan Center in Oberlin. Gassmann worked at Good Samaritan from September 16, 1985, to December 10, 1993, as a certified nurse's aide. She was terminated for inconsiderate treatment of residents. On June 27, 1994, Gassmann filed a wrongful discharge lawsuit based upon Good Samaritan's violation of an implied employment contract and violation of public policy. She sought an award for back pay and reinstatement.

"At her September 17, 1994, deposition, Gassmann admitted that while she was still employed at Good Samaritan, she entered the office of the acting director of nursing without authorization and took a videotape of a company in-service meeting. She copied the videotape and then returned it to the office the next morning. In her deposition testimony, Gassmann agreed that the purpose for taking the tape was to serve as evidence in an effort to get rid of the acting facility director.

"On December 5, 1994, Good Samaritan filed a motion for summary judgment. The basis for the motion was neither the implied contract nor the facts surrounding Gassmann's termination, but instead was the evidence acquired during her deposition concerning the videotape. Good Samaritan requested that the district court "Good Samaritan submitted an affidavit from its administrator indicating that all employees received an employee handbook which states that any employee will be terminated if found to have engaged in 'theft from coworker(s), resident(s), and/or the facility.' Gassmann acknowledged receipt of copies of all Good Samaritan's employee handbooks. The administrator stated that if Gassmann had still been employed when he learned of the 'theft' of the videotape, he would have immediately terminated her.

adopt the after-acquired evidence doctrine, i.e., evidence discovered after an employee's termination can be used to justify the discharge, if the evidence would have also been sufficient to terminate the employee, and grant its motion.

"In her affidavit, Gassmann explained that all employees of Good Samaritan were required to either attend all in-service meetings or, if unable to attend, watch the videotape of the meeting. The facility director became upset at a particular in-service meeting, and Gassmann stated she wanted to watch the videotape of that meeting because she had missed the meeting. Gassmann also stated that prior to her termination, there had been much dissension between the employees and management of Good Samaritan. However, Gassmann contends she had no intent to use the videotape in an effort to get the acting director fired. Contrary to her deposition, she stated in her affidavit, 'I made the copy in order to preserve the tape because I was afraid the tape, which showed the director acting inappropriately, would"get lost." I did not make the copy in a mutinous attempt to get [the director] fired.'

"Gassmann also submitted the affidavit of Lila Keenan, a former employee of Good Samaritan. Keenan confirmed Gassmann's statements that all Good Samaritan employees were required to watch the videotape of any missed in-service meetings. Keenan stated the only rule regarding taking videotapes was that they were to be returned quickly so others would be able to watch them. Keenan maintained she had taken a videotape home before to watch a missed in-service meeting and then returned it. Keenan did not believe this violated a company policy." 22 Kan.App.2d at 632-34, 921 P.2d 224.

DISCUSSION

Court of Appeals' Opinion

The Court of Appeals affirmed the district court's determination that the after-acquired evidence doctrine applied. As to ordinary wrongful discharge breach of employment contract cases not involving any overriding governmental interest, the Court of Appeals said:

"[W]e find the limits placed on the after-acquired evidence doctrine disseminated in McKennon [v. Nashville Banner Pub. Co., 513 U.S. 352, 115 S.Ct. 879, 130 L.Ed.2d 852 (1995),] are not applicable to the case at bar and hold that this employee is not entitled to any relief if the employer can establish after-acquired evidence sufficient for termination." 22 Kan.App.2d at644, 921 P.2d 224.

We agree. The Court of Appeals, citing McKennon, 513 U.S. at ----, 115 S.Ct. at 886-87, 130 L.Ed.2d at 864, identified the following three-prong test for an employer to rely on in asserting the defense of after-acquired evidence: "An employer must satisfy the following conditions: (1) The plaintiff was guilty of some misconduct of which the employer was unaware; (2) the misconduct would have justified discharge; and (3) if the employer had known of the misconduct, the employer would have discharged the plaintiff." 22 Kan.App.2d at 645, 921 P.2d 224. The Court of Appeals affirmed that the third prong was satisfied, but reversed on the first two prongs, finding issues of material fact, and remanded.

Good Samaritan's Petition for Review

Good Samaritan did not seek review of the Court of Appeals' holding that the after-acquired evidence doctrine applied. Gassmann has not cross-petitioned for review on any issue.

Under Rule 8.03(a)(5)(c) (1996 Kan. Ct. R. Annot. 48), applicability of the after-acquired evidence issue is "fairly included" in the two issues upon which Good Samaritan seeks review. Those two issues concern whether genuine issues of material fact remain as to two of the three McKennon prongs needed for application of the after-acquired evidence doctrine. The material fact issues necessarily involve determining whether the after-acquired evidence doctrine should be considered applicable in Kansas wrongful discharge cases based on implied contract. We reason that the after-acquired evidence issue is before us.

The Court of Appeals' opinion addressed the definition and rationale of the after-acquired evidence doctrine:

"The after-acquired evidence doctrine in its purest form allows an employer to be relieved of liability in a wrongful discharge lawsuit where it is discovered, normally during litigation, that the employee was guilty of pre-discharge misconduct sufficient for termination that the employer was unaware of and was not relying upon for discharge. See Summers v. State Farm Mut. Auto. Ins. Co., 864 F.2d 700 (10th Cir.1988); Yoo, The After-Acquired Evidence Doctrine, 25 Colum. Hum. Rts. L.Rev. 219, 228 (Fall 1993) (the Summers rule). The after-acquired evidence doctrine has its foundation in the logic that an employee cannot complain about being wrongfully discharged because the individual is no worse off than he or she would have been had the truth of his or her misconduct been presented at the outset. See Annot., After-Acquired Evidence of Employee's Misconduct as Barring or Limiting Recovery in Action for Wrongful Discharge, 34 A.L.R. 5th 699, 707." 22 Kan.App.2d at 634-35, 921 P.2d 224.

Although Gassmann's petition alleges in conclusory fashion that she was wrongfully discharged in violation of public policy, she offers no evidence to show that her termination raised any public policy concerns. She does not claim that her discharge was retaliatory or...