Hurley v. Allied Chemical Corp.

• Decision Date: 05 February 1980
• Docket Number: No. CC910,CC910
• Citation: 164 W.Va. 268,262 S.E.2d 757
• Court: West Virginia Supreme Court
• Parties: , 22 Empl. Prac. Dec. P 30,793 Joseph R. HURLEY v. ALLIED CHEMICAL CORPORATION.

Page 757

262 S.E.2d 757

164 W.Va. 268, 22 Empl. Prac. Dec. P 30,793

Joseph R. HURLEY v. ALLIED CHEMICAL CORPORATION.

No. CC910.

Supreme Court of Appeals of West Virginia.

Feb. 5, 1980.

Syllabus by the Court

1. The following is the appropriate test to determine when a State statute gives rise by implication to a private cause of action: (1) the plaintiff must be a member of the class for whose benefit the statute was enacted; (2) consideration must be given to legislative intent, express or implied, to determine whether a private cause of action was intended; (3) an analysis must be made of whether a private cause of action is consistent with the underlying purposes of the legislative scheme; and (4) such private cause of action must not intrude into an area delegated exclusively to the federal government.

2. W.Va.Code, 27-5-9(a), creates an implied private cause of action against a private employer who denies employment to an otherwise qualified individual on the sole basis that such individual has received services for mental illness, mental retardation or addiction.

Daniel F. Hedges, Charleston, Robert S. Baker, Fayetteville, for plaintiff.

George E. Pickett, M.D., M. P. H. Director, Charleston, for Department of Health.

Spilman, Thomas, Battle & Klostermeyer and Charles L. Woody and Cynthia L. Turco, Charleston, for defendant.

MILLER, Justice:

This case comes to us upon certified question from the Circuit Court of Fayette County. We are asked to decide: (1) whether the denial of employment in the private sector solely on the basis of the applicant having received mental health services contravenes W.Va.Code, 27-5-9(a), and gives rise to an implied private cause of action; and (2) whether such a denial frustrates the rehabilitative purposes of this statute, thus violating State public policy and giving rise to a cause of action under Harless v. First National Bank, W.Va., 246 S.E.2d 270 (1978). We answer the first question in the affirmative and the second in the negative.

For purposes of ruling upon the defendant's motion to dismiss under our case law, ¹ the Circuit Court would have necessarily accepted as true the following factual allegations of the complaint.

In June of 1978, defendant Allied Chemical Corporation (hereinafter Allied) accepted a preliminary employment application for a coal miner position from plaintiff Joseph Hurley. Hurley passed the routine phases of a required physical examination, but Allied was notified by the physician that Hurley had informed him that he had taken medication for depression. Allied then notified Hurley that he had failed the physical examination and would be denied employment. Admitting that he had received services from a mental health facility, Hurley unsuccessfully attempted to persuade the personnel manager of Allied to offer him employment, and then filed this action for declaratory and injunctive relief and damages.

The Circuit Court granted Allied's motion to dismiss, but certified the case. Consequently, our only task is to determine whether the plaintiff's complaint states a cause of action. We do not determine the ultimate question of whether he will prevail. See Harless v. First National Bank, supra, W.Va., 246 S.E.2d at 272.

The plaintiff's contention that Harless creates a substantive cause of action applicable to this case is not well founded. In Harless, we dealt with what may be termed the retaliatory discharge rule, where an at will employee is fired because he has exercised some substantial public right which his employer has attempted to frustrate or avoid. An essential ingredient for the cause of action is an existing employment relationship between the parties. In the present case, Hurley did not occupy any employment status with Allied and, therefore, Harless is not applicable.

The crux of the controversy between Hurley and Allied is whether W.Va.Code, 27-5-9(a), ² creates an implied private cause of action in favor of persons denied private employment solely on the ground that they have received some form of mental health services.

This Court has not had occasion to give detailed consideration to the question of under what circumstances a statute gives rise to an implied private cause of action. In oblique reference to this question, we have said in negligence cases that the violation of a statute or ordinance is Prima facie evidence of negligence. See, e. g., Costello v. City of Wheeling, 145 W.Va. 455, 461, 117 S.E.2d 513 (1960); Barniak v. Grossman, 141 W.Va. 760, 765, 93 S.E.2d 49 (1956); See Scott v. Hoosier Engineering Co., 117 W.Va. 395, 185 S.E. 553 (1936). We stated the following qualification to this rule in Syllabus Point 1 of Steiner v. Muldrew, 114 W.Va. 801, 173 S.E. 891 (1934):

"The violation of a statute, intended for the protection of persons of a certain class, cannot be the basis of a cause of action on the part of persons not belonging to the class intended to be protected by the statute."

In some instances we have indicated that an implied right of action may arise from the language of Article III, Section 17 of the West Virginia Constitution, providing that "(t)he courts of this State shall be open, and every person, for an injury done to him, in his person, property or reputation shall have remedy (by) due course of law . . . ." See, e. g., State Human Rights Commission v. Pearlman Realty Agency, W.Va., 239 S.E.2d 145 (1977); Coal & Coke Railway v. Conley, 67 W.Va. 129, 154, 67 S.E. 613 (1910).

On a number of occasions, the United States Supreme Court has been confronted with the question of whether a given statute gives rise to an implied cause of action. ³ In Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2089, 45 L.Ed.2d 26, 36-37 (1975), the Court set out a four-factor analysis to determine whether Congress intended to extend a private cause of action in a particular statute:

"In determining whether a private remedy is implicit in a statute not expressly providing one, several factors are relevant. First, is the plaintiff 'one of the class for whose Especial benefit the statute was enacted,' Texas & Pacific R. Co. v. Rigsby, 241 U.S. 33, 39, 36 S.Ct. 482, 484, 60 L.Ed. 874 (1916) (emphasis supplied) that is, does the statute create a federal right in favor of the plaintiff? Second, is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one? See, e. g., National Railroad Passenger Corp. v. National Assn. of Railroad Passengers, 414 U.S. 453, 458, 460, 94 S.Ct. 690, 693, 694, 38 L.Ed.2d 646 (1974) (Amtrak). Third, is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff? See, e. g., Amtrak, supra; Securities Investor Protection Corp. v. Barbour, 421 U.S. 412, 423, 95 S.Ct. 1733, 1740, 44 L.Ed.2d 263 (1975); Calhoon v. Harvey, 379 U.S. 134, 85 S.Ct. 292, 13 L.Ed.2d 190 (1964). And finally, is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law? See Wheeldin v. Wheeler, 373 U.S. 647, 652, 83 S.Ct. 1441, 1445, 10 L.Ed.2d 605 (1963); cf. J. I. Case Co. v. Borak, 377 U.S. 426, 434, 84 S.Ct. 1555, 1560, 12 L.Ed.2d 423 (1964); Bivens v. Six Unknown Federal Narcotics Agents, 403 U.S. 388, 394-395, 91 S.Ct. 1999, 2003-2004, 29 L.Ed.2d 619 (1971); id., at 400, 91 S.Ct., at 2006 (29 L.Ed.2d 619) (Harlan, J., concurring in judgment)."

It is obvious that the Cort test provides a more rational analysis than that to which we have been accustomed to determine whether a private cause of action is to be implied from a statute. We have utilized one element of the test in Steiner v. Muldrew, supra, by requiring that the plaintiff be a member of the class which the statute was intended to protect.

It is also apparent that the fourth and final element of the Cort test, whether the cause of action attempted to be inferred from the statute is "traditionally relegated to state law," is not applicable to a state statute. This factor derives from the basic principle of federalism which accords deference to the states in those areas of the law customarily regulated by them, Santa Fe Industries v. Green, 430 U.S. 462, 478-80, 97 S.Ct. 1292, 1303-04, 51 L.Ed. 480, 495-96 (1977); Piper v. Chris-Craft Industries, Inc., 430 U.S. 1, 40-41, 97 S.Ct. 926, 948-949, 51 L.Ed.2d 124, 153 (1977); See Burks v. Lasker, 441 U.S. 471, 99 S.Ct. 1831, 60 L.Ed.2d 404 (1979), and is founded on a recognition that Congress would not intend to create by implication a private cause of action which would constitute a new federal right in an area of the law traditionally regulated by the states.

In the case of a state statute, similar logic would suggest that an appropriate fourth step would be to determine whether the cause of action sought to be implied would conflict with a remedy within the exclusive purview of the federal government. Under our system of federalism, the states enjoy a large reservoir of power not pre-empted by federal law. As a result, a state remedy will, more often than not, be parallel or complementary to a federal remedy. ⁴

Cannon v. University of Chicago, 441 U.S. 677, 99 S.Ct. 1946, 60 L.Ed.2d 560 (1979), is the most recent decision of the Supreme Court raising the issue of whether a private cause of action should be implied in the context of a civil rights statute. In Cannon, a woman who was allegedly denied admission to a medical school because of her sex brought suit under the following general language of § 901(a) of Title IX of the Education Amendments of 1972, 20 U.S.C. § 1681:

"No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance . . . ."

Applying the first Cort factor,...