Jacobson v. Parda Federal Credit Union, Docket No. 105050

• Decision Date: 19 May 1998
• Docket Number: No. 16,Docket No. 105050,16
• Citation: 457 Mich. 318,577 N.W.2d 881
• Parties: , 14 IER Cases 73 G. Marie JACOBSON, Plaintiff-Appellee, v. PARDA FEDERAL CREDIT UNION, Defendant-Appellant, and Herman Armstrong, Geoffrey Dobson, William Alegnani, Thomas Hippe, John Camiolo, and Jeffrey Broderick, Defendants. Calendar
• Court: Michigan Supreme Court

Page 881

577 N.W.2d 881

457 Mich. 318, 14 IER Cases 73

G. Marie JACOBSON, Plaintiff-Appellee, v. PARDA FEDERAL CREDIT UNION, Defendant-Appellant and Herman Armstrong, Geoffrey Dobson, William Alegnani, Thomas Hippe, John Camiolo, and Jeffrey Broderick, Defendants.

Docket No. 105050.

Calendar No. 16.

Supreme Court of Michigan.

Argued Nov. 4, 1997.

Decided May 19, 1998.

Morganroth & Morganroth by Mayer Morganroth and Jeffrey B. Morganroth, Southfield, for Plaintiff-Appellee.

Bowen, Anderson, Radabaugh, Milton & Brown, P.C. by Thomas R. Bowen, Susan Leigh Brown, and Evelyn C. Tombers, Troy, for Defendant-Appellant.

Plunkett & Cooney, P.C. by Ernest R. Bazzana, Detroit, for amicus curiae Michigan Defense Trial Counsel, Inc.

Opinion

MICHAEL F. CAVANAGH, Justice.

The case calls on us to decide whether the plaintiff's action, which was successful on the merits before a jury, was barred by the statute of limitations prescribed by the Whistleblowers' Protection Act. ¹ Because the plaintiff has alleged and proven an act by her employer in violation of the Whistleblowers' Protection Act within the limitation period, we find that her action is not barred.

The plaintiff filed her action on January 19, 1990, ninety days after writing and sending her letter of resignation to her employer. Her complaint alleged, inter alia, that she had been constructively discharged from her employment in violation of the act. ² Following a jury verdict ³ for the plaintiff, the trial court granted defendant's motion for directed verdict, ⁴ agreeing with defendant's contention that the plaintiff's claim was barred because the plaintiff had not filed her claim within the ninety-day statutory period for claims under the act. ⁵

The Court of Appeals reversed in part, finding a continuing pattern of discriminatory conduct, with most acts outside the statutory period, but at least one act within it. ⁶ The Court of Appeals concluded that this fit within an exception to the limitation period for continuing violations, ⁷ and that the plaintiff's complaint was therefore timely filed. We granted defendant's application for leave to appeal. ⁸

We find that the plaintiff has shown that she was constructively discharged ⁹ on the date of resignation in retaliation for conduct protected by the act. ¹⁰ It is undisputed that when the plaintiff filed her action, the period of limitation covering any actions on the date of her resignation, October 21, 1989, had not expired. Accordingly, we affirm the result reached by the Court of Appeals, but on different grounds. ¹¹

I

Plaintiff G. Marie Jacobson worked for defendant Parda Federal Credit Union from 1972 until her resignation on October 21, 1989. Beginning as a temporary employee, she eventually rose to the position of executive vice president and chief operating officer. While serving in this position, plaintiff, after consulting with her private attorney, contacted the Federal Bureau of Investigation on February 28, 1989, to report her suspicions regarding a bond claim filed by the defendant with its insurer. Plaintiff believed that this bond claim was unsupported and, therefore, improper and perhaps fraudulent.

That same day, the board of directors of the credit union learned of plaintiff's action. Thereafter, plaintiff noted a dramatic decline in her relationship with the board. The plaintiff testified that the board was upset and outraged that she had reported the credit union to the FBI. ¹²

Joseph Abate was president and CEO of the credit union during this time, but had announced his retirement effective April 1, 1989. Plaintiff believed herself to be generally considered to be Abate's successor. Shortly before Abate's retirement, she was assured by members of the board that no search was being conducted for a replacement for Abate, and that, even if there was to be a search, she would have a "fair chance" in any search to fill Abate's position. Following Abate's retirement, however, the chairman of the credit union's board, Herman Armstrong, was named acting interim CEO.

From there, the plaintiff detailed at trial an extensive collection of actions adverse to her taken by the board, including the placing of a blind advertisement for the CEO position, the offering of the position to another candidate (who declined it), the failure of the board to inform her of its eventual decision to appoint her CEO, and the recission of that decision before it in fact took effect. ¹³ It is undisputed that all these actions occurred well outside the statutory limitation period present when the plaintiff filed her action.

Eventually, on August 16, 1989, the credit union hired Katie Stone as interim president and CEO. Simultaneously, plaintiff's staff was assigned to report to Stone, and plaintiff was relieved of her previous job duties. Plaintiff testified that from this point forward she was ostracized and ignored by the board.

On October 21, 1989, plaintiff typed out a letter of resignation and mailed it to the board members, leaving an additional copy on Stone's desk. It is undisputed that plaintiff was alone at work that day, a Saturday. Plaintiff reported to work on the following Monday, October 23, 1989, and was instructed by Stone to clean out her desk and leave at once. Plaintiff complied with Stone's instructions.

On January 19, 1990, exactly ninety days after the day plaintiff wrote and mailed her letter of resignation, she filed this action. The defendant moved for a directed verdict at the close of plaintiff's proofs and again at the close of its proofs. The trial court took both motions under advisement. Following a jury verdict in favor of the plaintiff, the trial court granted a directed verdict (judgment notwithstanding the verdict) in favor of the defendant on all counts. The Court of Appeals reversed in part, with respect to the finding that plaintiff's whistleblowers' action was barred by the statute of limitations. It is from this portion of the Court of Appeals decision that the defendant appeals. We now affirm, for reasons other than those stated by the Court of Appeals.

II

The issue whether a claim is within the period of limitation is one of law, Solowy v. Oakwood Hosp. Corp., 454 Mich. 214, 216, 561 N.W.2d 843 (1997), and hence reviewed de novo, Cardinal Mooney High School v. Michigan High School Athletic Ass'n, 437 Mich. 75, 80, 467 N.W.2d 21 (1991). Here, because a jury has found in favor of the plaintiff, and the trial court entered a directed verdict, plaintiff on appeal is entitled to all factual issues being viewed in the light most favorable to her, along with the drawing of reasonable favorable inferences from them. Caldwell v. Fox, 394 Mich. 401, 231 N.W.2d 46 (1975).

Plaintiff filed her action on January 19, 1990. Under the act, the period of limitation for an action alleging unlawful retaliatory conduct is ninety days. Therefore, the first step in any analysis of this claim is to determine whether the plaintiff has stated a claim regarding events within the limitation period. ^{14 14} Even if we were to agree with the analysis of the Court of Appeals of the events that were otherwise barred by the statute of limitations, the analysis must nevertheless begin at those times within the period of limitation. ^{15 15} Simply stated, if the plaintiff has alleged an action within the period of limitation, and the trier of fact has found in favor of the plaintiff's claims, we need look no further.

Here the plaintiff resigned on October 21, 1989. She was admittedly alone at work on that day, a Saturday. Plaintiff testified that her working conditions had become intolerable, and offered considerable testimony in support of her claims that the conditions had steadily deteriorated in response to her reporting certain actions of the board of directors of her employer to the FBI.

The question when a constructive discharge occurs has been previously addressed by this Court only in the context of a Michigan Civil Rights Act ¹⁶ claim. Champion v. Nationwide Security, Inc., 450 Mich. 702, 545 N.W.2d 596 (1996). Noting that "a constructive discharge occurs only where an employer or its agent's conduct is so severe that a reasonable person in the employee's place would feel compelled to resign," ¹⁷ we found that the supervisor's conduct in Champion was severe enough to compel the plaintiff to resign. ¹⁸

Defendant argues that Champion stands for the proposition that the act of an employer constitutes the action that results in the "discharge" in a constructive discharge situation, and that, therefore, the timing of the action of the employer controls. We disagree. The act of the employer and the constructive discharge were inseparable in Champion. Our analysis did not deviate from the standard expressed in Vagts, that is, would a reasonable person in plaintiff's position have felt compelled to resign as a result of the employer's sexual assault? Applying that same standard, the defendant's motion for judgment notwithstanding the verdict should not have been granted if, viewing the evidence in a light most favorable to the plaintiff, jurors could have reached different conclusions whether plaintiff's working conditions were so intolerable that a reasonable person in plaintiff's position would have felt compelled to resign. Champion, 450 Mich. at 710, 545 N.W.2d 596; Vagts v. Perry Drug Stores, Inc., 204 Mich.App. 481, 487, 516 N.W.2d 102 (1994). ¹⁹

III

In this case, the plaintiff alleged that her work conditions, as a result of retaliatory action prohibited by the act, became intolerable as of October 21, 1989, and she submitted her resignation on that day. The trier of fact accepted this contention.

While an employer's action may lead to a constructive discharge, such a discharge itself generally cannot become evident until the employee has, in fact, left the employment. It seems, therefore, that to say that a discharge occurred whenever an employer's action that resulted...