Jarvenpaa v. Glacier Elec. Co-op., Inc.

• Citation: 1998 MT 306,970 P.2d 84,292 Mont. 118
• Decision Date: 10 December 1998
• Docket Number: No. 97-071,97-071
• Parties: Donald JARVENPAA, Plaintiff and Appellant, v. GLACIER ELECTRIC COOPERATIVE, INC., Defendant and Respondent.
• Court: Montana Supreme Court

Page 84

970 P.2d 84

292 Mont. 118

Donald JARVENPAA, Plaintiff and Appellant, v. GLACIER ELECTRIC COOPERATIVE, INC., Defendant and Respondent.

No. 97-071.

Supreme Court of Montana.

Submitted on Briefs Feb. 26, 1998.

Decided Dec. 10, 1998.

Jean E. Faure and Timothy B. Strauch; Church, Harris,Johnson & Williams, P.C.; Great Falls, Montana, for Appellant.

Gary R. Christiansen; Warden, Christiansen, Johnson & Berg, PLLP; Kalispell, Montana, for Respondent.

JIM REGNIER, Justice.

¶1 Donald Jarvenpaa, an employee of Glacier Electric Cooperative, Inc., was offered the option of early retirement to avoid termination. Jarvenpaa chose to retire, accepted lump sum cash retirement benefits, then filed a wrongful discharge action against Glacier in the Ninth Judicial District Court, Glacier County. In response, Glacier filed a counterclaim to recover part of the retirement benefits Jarvenpaa received. The case was tried before a jury which returned a special verdict in Glacier's favor on both the wrongful discharge claim and the counterclaim, thus requiring Jarvenpaa to return $106,000 of his early retirement benefits, plus interest accrued. Judgment was entered on said verdict, and Jarvenpaa appeals. We affirm.

¶2 The dispositive issues on appeal are:

¶3 1. Did the District Court err when it denied Jarvenpaa's motion for summary judgment on Glacier's counterclaim?

¶4 2. Did the District Court err when it refused to bifurcate Glacier's counterclaim from Jarvenpaa's wrongful discharge claim?

¶5 3. Did the District Court err when it limited Jarvenpaa's expert testimony and, in turn, refused Jarvenpaa's proposed jury instructions that pertained to Glacier's alleged personnel policy?

¶6 4. Did the District Court err when it allowed Glacier to introduce post-discharge evidence to substantiate the reasons why it discharged Jarvenpaa?

FACTUAL BACKGROUND

¶7 For approximately thirty years, Donald Jarvenpaa was employed with Glacier Electric Cooperative, Inc., in a variety of positions, including manager of operations. However, on September 29, 1992, Glacier informed Jarvenpaa that due to alleged performance problems it would terminate him effective December 31, 1992. Instead of firing Jarvenpaa, Glacier offered him an early retirement option. Glacier offered the early retirement option to four other employees; however, only Jarvenpaa had to retire or be fired. The total lump sum retirement package presented and accepted by Jarvenpaa was approximately $318,116. This sum included approximately $106,000 of early retirement benefits.

¶8 After Jarvenpaa accepted the early retirement benefits, he filed a wrongful discharge action against Glacier on November 3, 1993, in the Ninth Judicial District Court, Glacier County. Pursuant to § 39-2-904, MCA, Jarvenpaa alleged that Glacier terminated him without good cause and in violation of its own written personnel policy. He also alleged that Glacier's actions were malicious and in retaliation for reporting Glacier's violation of environmental standards, pursuant to § 39-2-905(2), MCA, which allows for punitive damages.

¶9 During the initial proceedings, Glacier filed a motion for summary judgment contending that Jarvenpaa should be precluded from pursuing a wrongful discharge claim since he agreed to retire. The District Court granted Glacier summary judgment and Jarvenpaa appealed. On July 11, 1995, we reversed the District Court's order granting summary judgment. This Court determined that Jarvenpaa had been constructively discharged since he did not voluntarily retire; therefore, he had a right to pursue his wrongful discharge action. See Jarvenpaa v. Glacier Elec. Coop., Inc. (Jarvenpaa I) (1995), 271 Mont. 477, 898 P.2d 690.

¶10 The issues now before us result from the District Court's rulings upon remand of Jarvenpaa's wrongful discharge action. After remand, the District Court allowed Glacier to file a counterclaim to collect the additional $106,000 that Jarvenpaa received for his early retirement, plus interest. Jarvenpaa moved for summary judgment in his favor on the counterclaim, but the District Court denied his motion. When Jarvenpaa requested that the District Court bifurcate Glacier's counterclaim from his wrongful discharge action, the District Court allowed the counterclaim to proceed and, in turn, overruled attempts to exclude evidence of his early retirement election. In addition, the District Court admitted certain post-termination evidence which Glacier offered to substantiate its reasons for terminating Jarvenpaa. Finally, when Jarvenpaa attempted to introduce expert testimony to establish that Glacier violated its own written personnel policy, the District Court partially excluded such testimony. The District Court also refused Jarvenpaa's proposed jury instructions relating to the existence of a personnel policy.

¶11 On November 8, 1996, the jury returned a special verdict for Glacier. The jury decided that Jarvenpaa was not wrongfully discharged and awarded Glacier $130,069.26 on its counterclaim. Accordingly, the District Court entered judgment against Jarvenpaa on November 14, 1996. Jarvenpaa now appeals the District Court's rulings.

STANDARD OF REVIEW

¶12 Our standard of review of a district court's denial of a motion for summary judgment is de novo. See Stutzman v. Safeco Ins. Co. (1997), 284 Mont. 372, 376, 945 P.2d 32, 34. Our standard of review of a district court's discretionary rulings is abuse of discretion. See May v. First Nat'l Pawn Brokers, Ltd. (1995), 270 Mont. 132, 134, 890 P.2d 386, 388. In Montana Rail Link v. Byard (1993), 260 Mont. 331, 337, 860 P.2d 121, 125, we held that "[t]he standard of abuse of discretion is applied to discretionary rulings, such as trial administration issues, post-trial motions and similar rulings." In Malta Public School District A and 14 v. Montana Seventeenth Judicial District Court (1997), 283 Mont. 46, 50, 938 P.2d 1335, 1338, we stated that under Rule 42(b), M.R.Civ.P., the decision as to whether to bifurcate a trial is a matter left to the "broad discretion" of the district court. In State v. Romero (1996), 279 Mont. 58, 73, 926 P.2d 717, 726-27, and many cases thereafter, we stated that we review a district court's ruling on the admission of evidence for an abuse of discretion. In Cechovic v. Hardin & Associates (1995), 273 Mont. 104, 116, 902 P.2d 520, 527, and cases thereafter, we applied the abuse of discretion standard to a trial court's selection of jury instructions.

¶13 The test for abuse of discretion is whether the trial court acted arbitrarily without employment of conscientious judgment or exceeded the bounds of reason resulting in substantial injustice. See C. Haydon Ltd. v. Montana Mining Properties, Inc. (1997), 286 Mont. 138, 146, 951 P.2d 46, 51. We will not substitute our judgment for the district court's unless it clearly abused its discretion. See C. Haydon Ltd., 286 Mont. at 146, 951 P.2d at 51.

ISSUE 1

¶14 Did the District Court err when it denied Jarvenpaa's motion for summary judgment on Glacier's counterclaim?

¶15 Glacier contends that since Jarvenpaa maintains that he was discharged, he did not effectively retire and, therefore, should not be entitled to keep the early retirement benefits he received. Glacier argues that Jarvenpaa cannot elect to both retire and be fired. Applying a contract theory, Glacier further argues that since Jarvenpaa failed to fully perform his retirement, he breached his retirement agreement and should be compelled to pay back the early retirement benefits he received from this agreement.

¶16 Jarvenpaa argues that he is entitled to summary judgment on Glacier's counterclaim because his wrongful discharge action should not affect his retirement agreement. He contends that his retirement was complete the day he voluntarily stopped working for Glacier. Additionally, he argues that since Glacier did not bargain for a release of potential claims in the retirement agreement, which Glacier itself drafted, Glacier should not be granted the net effect of a release by being allowed to pursue its counterclaim.

¶17 To address these arguments, we must first return to our discussion in Jarvenpaa I. We determined in Jarvenpaa I that Jarvenpaa was constructively discharged, despite his agreement to retire. Now, we are asked whether, by prosecuting his wrongful discharge claim, Jarvenpaa must return a portion of his retirement benefits which represents the early retirement part of his lump sum retirement package.

¶18 In the case sub judice, it is clear that Jarvenpaa's retirement agreement was made as part of an ultimatum to either retire or be fired. Glacier caused Jarvenpaa to elect one or the other. Jarvenpaa could not elect both; hence, he could not elect to receive the benefits of both. He could either take an additional $106,000 in early retirement benefits, or he would be terminated. Jarvenpaa took the money, then claimed he did not retire but instead was constructively discharged. We agreed in Jarvenpaa I that the forced retirement was, in fact, a constructive discharge. However, Jarvenpaa cannot at the same time both retire and be discharged. We hold that while Jarvenpaa had the right to pursue the constructive discharge as wrongful, he cannot now keep the early retirement benefits after a jury determined that his discharge was not wrongful.

¶19 Jarvenpaa analogizes his case to cases involving employees' retention of severance benefits in actions brought pursuant to the Age Discrimination in Employment Act, 29 U.S.C. § 621-623 (1996), and similar federal statutes. See, e.g., Raczak v. Ameritech Corp. (6th Cir.1997), 103 F.3d 1257, cert. denied (1998), --- U.S. ----, 118 S.Ct. 1033, 140 L.Ed.2d 101; Long v. Sears, Roebuck & Co. (3d Cir.1997), 105 F.3d 1529, cert. denied (1998), --- U.S. ----, 118 S.Ct. 1033, 140 L.Ed.2d 100; Oberg v. Allied Van Lines, Inc. (7th Cir.1993), 11 F.3d 679, cert. denied (1994), 511 U.S. 1108, 114 S.Ct. 2104, 128...