Handam v. Wilsonville

• Jurisdiction: Oregon
• Parties: Aladdin H. HANDAM, Plaintiff-Appellant Cross-Respondent, v. WILSONVILLE HOLIDAY PARTNERS, LLC, an Oregon limited liability company, dba Wilsonville Holiday Inn, Defendant-Respondent Cross-Appellant, and Gerardo Peregrina and Lockhart Investments, LLC, dba Lockhart Investments Management Group and Lockhart Investments, Defendants-Respondents.
• Citation: 225 Or. App. 442,201 P.3d 920
• Docket Number: A128759.,C040634CV.
• Court: Oregon Court of Appeals
• Decision Date: 28 January 2009

201 P.3d 920

225 Or. App. 442

Aladdin H. HANDAM, Plaintiff-AppellantCross-Respondent, v.WILSONVILLE HOLIDAY PARTNERS, LLC, an Oregon limited liability company, dba Wilsonville Holiday Inn, Defendant-RespondentCross-Appellant, and Gerardo Peregrina and Lockhart Investments, LLC, dba Lockhart Investments Management Group and Lockhart Investments, Defendants-Respondents.

C040634CV.

A128759.

Court of Appeals of Oregon.

Argued and Submitted September 5, 2008.

Decided January 28, 2009.

Jeremy L. Fellows argued the cause and filed the briefs for appellant-cross-respondent.

Lisa E. Lear, Portland, argued the cause for respondent-cross-appellantWilsonville Holiday Partners, LLC, and respondentGerardo Peregrina.

No appearance for respondentLockhart Investments, LLC.

Before EDMONDS, Presiding Judge, and WOLLHEIM, Judge, and SERCOMBE, Judge.

WOLLHEIM, J.

Plaintiff appeals a judgment after a jury verdict awarded him damages on his common-law wrongful constructive discharge claim.His complaint also alleged other employment-related claims against defendants, including a statutory wage claim and a statutory claim for discrimination based on race.

Plaintiff asserts that the trial court erred in directing a verdict for defendantWilsonville Holiday Partners, LLC, (Wilsonville) on his statutory wage claim, and erred in striking punitive damages and disallowing attorney fees on the wrongful discharge claim against Wilsonville.Plaintiff further asserts that the trial court erred in entering judgments for Wilsonville and defendantGerardo Peregrina on the race discrimination claim.

Plaintiff obtained a default judgment against defendantLockhart Investments, LLC, (Lockhart) on his claim of race discrimination.¹He appeals from a supplemental judgment awarding him damages and attorney fees on that claim, asserting that the trial court erred in failing to award him the full amount of his requested attorney fees in light of the absence of an objection from Lockhart.

Wilsonville cross-appeals, contending that the trial court erred in denying its motion for directed verdict on the wrongful discharge claim.We conclude that the trial court erred in denying Wilsonville's motion for directed verdict, and therefore reverse the judgment for plaintiff against Wilsonville.Because Wilsonville's cross-appeal is dispositive of most of plaintiff's assignments of error, we address it first.In reviewing the trial court's denial of Wilsonville's motion for a directed verdict on the wrongful discharge claim, we state the facts in the light most favorable to plaintiff, in whose favor the jury reached a verdict.We will affirm the trial court's ruling unless there is no evidence from which the jury could have found the facts necessary to support the verdict with respect to each element of the claim.Rathgeber v James Hemenway, Inc.,335 Or. 404, 411, 69 P.3d 710(2003);Brown v. J.C. Penney Co.,297 Or. 695, 705, 688 P.2d 811(1984).

Plaintiff, who is an Arab, immigrated to the United States from Jordan in 1995 and obtained his U.S. citizenship in 2000.He began working at the Holiday Inn in 1995 and continued to work there when the facility was acquired by Wilsonville in 2001.At the relevant time, plaintiff worked as a banquet captain and a shift manager.In February 2002, Wilsonville hired defendant Peregrina as Restaurant and Banquet Manager, and he was plaintiff's immediate supervisor.Peregrina is Hispanic and he hired several Hispanic workers.

During his employment with Wilsonville, plaintiff received many commendations, including awards for superior performance and "Employee of the Year" in 2002.As a part of his employment, plaintiff was licensed to serve liquor under the administrative rules of the Oregon Liquor Control Commission(OLCC).As banquet captain and the morning shift manager, plaintiff supervised several Hispanic employees who were not fluent in English.

In December 2002, upon arriving at work one morning, plaintiff found a wrapped wedding gift hidden on a high shelf in the banquet office and a disposable camera in the banquet office waste basket.He assumed that the items had been left from a wedding reception the night before.Plaintiff remembered that banquet employees had been instructed to bring any misplaced property to the front desk.He took a picture of the gift with the disposable camera.

Plaintiff had the pictures in the camera developed.Some of them showed Hispanic employees drinking champagne and beer in the banquet office during their shift, in violation of OLCC rules.Plaintiff showed the photographs to some managers; they laughed but took no action against the employees.Plaintiff also learned that the Hispanic employees were violating OLCC rules by keeping open containers of alcoholic beverages in the banquet office and refrigerator.

In the spring of 2003, plaintiff brought the OLCC violations to Peregrina's attention.Plaintiff also expressed his concern to Peregrina that some Hispanic employees had said that they did not have proper documentation to work.Peregrina, who was responsible for making sure that new employees have proper work authorization, told plaintiff not to worry about it and to "give them a chance."

After plaintiff reported the violations to Peregrina, Peregrina began treating plaintiff differently by refusing to allow him to take rest and meal breaks, reducing his work hours, making his job harder by reducing his staff, correcting him about things for which he did not correct Hispanic employees, and giving Hispanic employees more hours even though plaintiff had seniority.Plaintiff began to believe that he was being treated differently because he is not Hispanic.Eventually, Peregrina demoted plaintiff to waiter.Plaintiff quit his job.He brought this proceeding, asserting, among other claims, that he was constructively discharged from his employment in retaliation for complaining about the Hispanic employees.

Wilsonville filed a motion for directed verdict on the constructive wrongful discharge claim, asserting that the evidence was insufficient to go to the jury, because plaintiff had failed to offer evidence that he had been discharged for fulfilling an important societal obligation or exercising a job-related right of important public interest.SeeHolien v. Sears, Roebuck and Co.,298 Or. 76, 86, 689 P.2d 1292(1984)(describing categories of wrongful discharge claims).The trial court determined that the evidence was sufficient to allow the claim to go to the jury, which found that plaintiff had been wrongfully discharged.On the cross-appeal, the question is whether there was evidence to support the jury's verdict with respect to each element of the wrongful discharge claim.

The general rule in Oregon is that employment is "at will."That means that, except as otherwise provided by statute or employment agreement, employees may be terminated without notice and for any reason.Simpson v. Western Graphics,293 Or. 96, 99, 643 P.2d 1276(1982).There are exceptions, however.As relevant to this case, Oregon allows recovery in tort to employees who are discharged for certain socially undesirable motives.Babick v. Oregon Arena Corp.,333 Or. 401, 407-10, 40 P.3d 1059(2002)(describing tort);Holien,298 Or. at 86, 689 P.2d 1292.An employer may be subject to tort liability for discharging an employee for fulfilling an important public duty or societal obligation, see, e.g., Delaney v. Taco Time Int'l,297 Or. 10, 16-17, 681 P.2d 114(1984)(employee discharged for refusing to defame another employee);Nees v. Hocks,272 Or. 210, 218-19, 536 P.2d 512(1975)(employee discharged for serving on jury); or for exercising a job-related right of public importance, see, e.g., Brown v. Transcon Lines,284 Or. 597, 612, 588 P.2d 1087(1978)(employee unlawfully discharged for filing workers' compensation claim).

Here, plaintiff was not discharged from his employment; he quit.Thus, to establish a wrongful discharge claim, he must additionally establish that he was constructively discharged, meaning that Wilsonville's intentional conduct made his employment so intolerable that a reasonable person in plaintiff's position would have resigned.McGanty v. Staudenraus,321 Or. 532, 557, 901 P.2d 841(1995).Contrary to plaintiff's contention, however, "constructive discharge" is not, in itself, a tort—it is simply an alternate means of establishing the element of discharge in a claim for wrongful discharge.Id.Thus, a plaintiff may satisfy the discharge prong of a wrongful discharge claim by pleading and proving a "constructive discharge," but the plaintiff must nonetheless establish a motive for the constructive discharge that gives rise to liability for wrongful discharge.The focus of Wilsonville's cross-appeal is on the adequacy of plaintiff's evidence with respect to Wilsonville's motive for the constructive discharge.

Plaintiff contends that he has presented evidence from which the jury could find that Wilsonville's motivation in constructively discharging him was to retaliate for plaintiff's exercise of a job-related right or an important societal obligation.We first address whether plaintiff's act of reporting the OLCC violations to his managers was a job-related right or an important societal obligation.

Plaintiff asserts that, as one who holds an OLCC service permit, he had an obligation to report the OLCC violations of his coworkers to his supervisor.He notes that ORS 471.385 authorizes OLCC to revoke a service permit when a permittee "permitted any act" that would constitute an OLCC violation.ORS 471.385.²Drinking on the job is an OLCC violation.OAR 845-006-0345.³As a permittee, plaintiff believed that he had an obligation to report OLCC violations to avoid losing his own permit for having "permitted" OLCC violations, and he asserts that that obligation was the type of job-related right or public duty that supports a claim for wrongful discharge....