H.S. v. Board of Regents, Southeast Missouri State University, 73720

• Decision Date: 14 April 1998
• Docket Number: No. 73720,73720
• Citation: 967 S.W.2d 665
• Parties: H.S., Respondent, v. BOARD OF REGENTS, SOUTHEAST MISSOURI STATE UNIVERSITY, Appellant.
• Court: Missouri Court of Appeals

Page 665

967 S.W.2d 665

H.S., Respondent, v. BOARD OF REGENTS, SOUTHEAST MISSOURI STATE UNIVERSITY, Appellant.

No. 73720.

Missouri Court of Appeals,

Eastern District,

Division Five.

April 14, 1998.

Rehearing Denied May 14, 1998.

Diane C. Howard, Limbaugh, Russell, Payne & Howard, David W. Terry, Cape Girardeau, for appellant.

John L. Cook, Thomasson, Gilbert, Cook & Maguire, J. Michael Ponder, Cape Girardeau, for respondent.

RICHARD B. TEITELMAN, Judge.

The Board of Regents, Southeast Missouri State University (Southeast) appeals from the trial court's judgment on a petition for a claim arising from disability discrimination filed by H.S. The Honorable Fred Copeland presided, sitting as a specially designated Judge in the Circuit Court of Cape Girardeau County, Missouri. Judgment in the amount of $600,000 was entered for H.S. and reasonable attorneys' fees, later determined to be $35,000, were also awarded. We affirm.

In reviewing court-tried civil cases, this Court applies the standard set forth in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo.1976) that "the decree or judgment of the trial court will be sustained ... unless there is no substantial evidence to support it, unless it is against the weight of the evidence, unless it erroneously declares the law, or unless it erroneously applies the law." The Court must uphold the judgment of the trial court under any reasonable theory pleaded and supported by the evidence. Roosevelt Bank v. Moore, 944 S.W.2d 261, 263 (Mo.App. E.D.1997). Pursuant to Rule 73.01(c)(2), the Court gives due regard to the opportunity of the trial court to judge the credibility of witnesses. The trial court did not enter findings of fact or conclusions of law, as none were requested by either party. This Court thus accepts all evidence and inferences favorable to the judgment and disregards all contrary inferences. Whiteside v. Rottger, 913 S.W.2d 114, 119 (Mo.App. E.D.1995).

Viewed in a light most favorable to the judgment, the facts are as follows:

H.S. became employed by Southeast in 1988. He worked in various positions before assuming a new University funded position as the Director of the Student Equal Opportunity Programs and Coordinator of Retention at Southeast in 1992. H.S. was to dedicate 40% of his time to overseeing three grant funded programs and 60% of his time to developing student retention efforts. The programs consisted of the Bootheel Educational Talent Search, Student Support Services and the Upward Bound Program ("TRIO Programs"). H.S. participated in the hiring of Dr. Irene Ferguson as director of the Upward Bound Program and Dr. Raushanah Khaaliq as director of Student Support Services. Drs. Ferguson and Khaaliq were responsible for the day to day operation and management of their respective grant programs.

In August, 1992, Dr. SueAnn Strom was hired as the Vice President for Student Affairs at Southeast. H.S. reported directly to Dr. Strom.

In May, 1993, Dr. Strom gave H.S. a rating between the highest category and the next highest category on her Performance Appraisal of him. Dr. Strom made a note that H.S. had not met expectations and needs in the area of retention. H.S. disagreed with the evaluation and submitted a memorandum stating he should have been given a rating in the highest category. H.S. received the same evaluation the next year.

On June 28, 1994, Dr. Strom learned that H.S. had been admitted to a hospital with pneumonia. During this hospitalization, H.S. learned that he was suffering with AIDS. H.S. was on medical leave until August 10, 1994. When he returned to work, H.S. informed Dr. Strom that his "T-count/immune system is out of whack." After his hospitalization, H.S. suffered throughout the 1994-1995 academic year from health problems including extreme weight loss, diarrhea, and neuropathy of the feet. In May, 1995, Dr. Strom gave H.S. the highest possible rating on his evaluation.

In May, 1995, Dr. Strom discussed H.S.'s health condition with the Director of the Center for Health and Counseling at the University. They spoke of the possibility that H.S. had an HIV infection. Beginning in July, 1995, H.S.'s file began to accumulate numerous critical comments from Dr. Strom. In July, H.S. had two letters of warning placed in his personnel file, one concerning monthly expense reports and the other regarding hiring practices. From July until his termination, Dr. Strom was critical of H.S. fifteen times on various issues.

In August of 1995, the Upward Bound Program experienced a budgetary shortfall due to the program being extended to another school district. This resulted in an increase in travel expense both for the Upward Bound counselors and for students enrolled in the program. The fact that the travel had been overextended came to the attention of Dr. Irene Ferguson, the project director, through her review of the monthly budget reports. Dr. Ferguson sought H.S.'s advice. H.S., in turn, notified Dr. Strom of the problem.

On Labor Day, 1995, Dr. Bill Atchley arrived to serve as Interim President of Southeast. Soon after his arrival he became aware of the budgetary shortfall involving the Upward Bound Program. In October, 1995, Dr. Atchley instructed the Director of University Auditing, Connie Heuschober, to conduct a fiscal and management audit of not only the Upward Bound Program, but of all TRIO programs. Unlike previous audits, Ms. Heuschober was instructed to report directly to Dr. Atchley. The scope of the audit was limited to the financial management and financial activity of the TRIO programs. The programmatic conduct of the programs was not to be considered.

Numerous problems appeared during the audit. Twelve separate findings were made of significant problems with the TRIO programs operations. Postage was purchased by grant funds but not used for grant purposes; equipment was purchased using Talent Search and Student Support Services funds, but the equipment was actually located in the offices of and used by Student Equal Opportunity Programs and the Upward Bound Program. Student workers were hired for the benefit of H.S.'s office, but their compensation was paid by Student Support Services. Employees and directors of the grant programs, as well as H.S., were all found to be using the University telephone service for excessive personal use and not reimbursing the University for that use. Money was sometimes switched between the accounts using falsified "internal vouchers." Large expenditures were made through the university book store at high retail prices instead of using the competitive bid process or the University's Purchasing Department, resulting in possibly higher prices having been paid. The audit did not find that any TRIO grant money had been stolen. H.S. was determined to owe Southeast $65.24, which he repaid. Dr. Khaaliq owed $17.00.

According to testimony at trial, the cost overruns Ms. Heuschober found all went to serve the purposes of Southeast. H.S. was not responsible for the day to day operations of the programs and his signature was not on the falsified vouchers or the purchases. H.S. was only required to approve the travel expenditures of his subordinates. His job description did not extend to budgetary responsibility over the TRIO programs.

A copy of the completed audit was provided to Dr. Atchley and Dr. Strom. Dr. Atchley requested that Dr. Strom make recommendations to him as to personnel actions to be taken as a result of the audit. Dr. Strom recommended to Dr. Atchley that the Directors of the three TRIO programs be suspended without pay and that H.S. be demoted to the position of Director of the Upward Bound Program. Dr. Atchley disagreed with that recommendation and instructed Dr. Strom to dismiss H.S. effective February 19, 1996. Dr. Atchley followed Dr. Strom's recommendation regarding the other employees; no other employees were terminated as a result of the audit.

After receiving the letter of termination, H.S. met with Dr. Strom, Southeast counsel and Mike Dougherty, Director of Personnel Services for Southeast. During the meeting, H.S. requested that his compensation and benefits continue through June 30, 1996. Dr. Strom told Dr. Atchley of this proposal and informed Dr. Atchley in a memorandum that she understood that H.S. "has a continuing illness although he has not confirmed exactly what said illness is." H.S. had told Dr. Strom between November, 1995 and January, 1996 that he had AIDS. Dr. Atchley upheld his earlier decision to terminate H.S. and discontinue his benefits effective February 19, 1996. Dr. Atchley testified he did not know H.S. had AIDS until H.S. filed an action against Southeast.

H.S. filed this action in the Circuit Court of Cape Girardeau on October 11, 1996. After a trial before Judge Copeland, judgment was rendered on December 1, 1997. H.S. was awarded $500,000 for "backpay, reasonable frontpay, emotional and physical damage suffered by the Plaintiff and medical expenses incurred now and in the future." The Court also awarded punitive damages in the amount of $100,000 and awarded reasonable attorneys' fees, which were later entered at $35,000.

I. The McDonnell Douglas

Burden Shifting Analysis

Southeast challenges the sufficiency of the evidence to support the trial court's judgment. A three-step burden-shifting framework for discrimination cases is set out in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973); this framework also applies here. The framework is used to progressively sharpen the inquiry into the question of whether intentional discrimination has occurred. In this analysis, the Plaintiff bears the initial burden of establishing a prima facie case of wrongful discharge. City of Clayton v. Missouri Commission on Human Rights, 821 S.W.2d 521, 527 (Mo.App. E.D.1991). To establish a prima facie case of discharge for disability, the Plaintiff must show (a) that he is disabled under the definition of the Act, (b...