Kneeland v. Luzenac America, Inc.

• Decision Date: 02 June 1998
• Docket Number: No. 97-149,97-149
• Citation: 961 P.2d 725,1998 MT 136,55 St.Rep. 541
• Parties: Bruce G. KNEELAND, Plaintiff and Appellant, v. LUZENAC AMERICA, INC., Defendant and Respondent.
• Court: Montana Supreme Court

Page 725

961 P.2d 725

1998 MT 136

Bruce G. KNEELAND Plaintiff and Appellant, v. LUZENAC AMERICA, INC. Defendant and Respondent.

No. 97-149.

Supreme Court of Montana.

Submitted on Briefs March 5, 1998.

Decided June 2, 1998.

Rehearing Denied July 16, 1998.

Michael J. San Souci; Law Office Michael J. San Souci; Bozeman, for Plaintiff and Appellant.

Thomas E. Hattersley, III, and Teri A. Walter; Gough, Shanahan, Johnson & Waterman; Helena, for Defendant and Respondent.

REGNIER, Justice.

¶1 The plaintiff, Bruce G. Kneeland, brought this action alleging that he was wrongfully discharged by defendant Luzenac America, Inc. Kneeland appeals the decision of the Fifth Judicial District Court, Madison County, granting defendant's motion for summary judgment on his breach of implied covenant claim. Kneeland also appeals the jury verdict finding that he was not wrongfully discharged by Luzenac. We affirm.

¶2 We restate the issues as follows:

¶3 1. Did the District Court err in granting summary judgment to Luzenac on Kneeland's claim of post-termination bad faith?

¶4 2. Did the District Court properly instruct the jury?

¶5 3. Was there substantial evidence to support the jury verdict?

¶6 4. Did the District Court err in denying Kneeland's motions for judgment as a matter of law, and motion for a new trial?

FACTUAL AND PROCEDURAL BACKGROUND

¶7 In 1981, Bruce G. Kneeland was hired by Cyprus Industrial Minerals to work for the company's Yellowstone Mine Operation. Later, Cyprus was renamed Luzenac America, Inc. Luzenac is a talc company with principal mine facilities in Montana and headquarters in Denver, Colorado. Luzenac's Montana Mines Division has three mine sites in Montana that operate separately. The largest site is the Yellowstone Mine near Ennis. The company also operates the Beaverhead Mine, a small underground mine in the Ruby Mountains, and the Antler Mine, a surface mine located south of Silver Star.

¶8 In the early 1990s, the talc market was in a downturn. Talc, a commodity, is an industrial mineral. Talc companies face competition from other industrial mineral producers, such as clay and calcium carbonate companies. Also, in recent years, there has been a large influx of talc into the market from cheaper, foreign producers. As a result, the United States talc market accumulated a large supply of inventory.

¶9 Faced with these conditions, Luzenac's Montana Mines Division reconfigured its workforce in late 1993 and mid-1994 to reduce its personnel by fifty-eight hourly positions. At first, Luzenac offered voluntary retirement and voluntary incentive packages to trim its workforce. However, these incentives did not result in a total reduction of fifty-eight hourly positions. Subsequently, the company reviewed its personnel needs and determined which job positions would be reduced in number and which positions would be eliminated completely or reconfigured.

¶10 The Montana Mines Division had a handbook applicable to all its hourly employees published by Cyprus, prior to the company's name change in 1992. The handbook was amended from time to time. As of 1994, the handbook contained a policy dealing with downsizing. The handbook specifically outlined a process by which employees may "bid" for open positions, or "bump" into occupied positions in the event of a reduction in force. A bump from an employee would displace another employee currently occupying that position.

¶11 The employees of the Montana Mines Division were aware that it was over staffed and required downsizing. The employees approached Mike Toelle, the general manager, with their concerns. To achieve an equitable result acceptable to all personnel, Toelle formed a committee of hourly employees from all three mine sites. The purpose of the committee was to develop a consensus on how the downsizing should occur and revise the policy on reducing the workforce.

¶12 Under the policy the committee developed, Yellowstone Mine employees, like Kneeland, could bid for any open position available at their mine. These employees could also bump into any position at the Yellowstone Mine or into a designated "entry-level" position at the Beaverhead mine, if they had the necessary qualifications for the position and more seniority than the individual occupying the position.

¶13 Job descriptions were posted detailing the open positions available for bid, and the entry level positions vulnerable to bumping. Employees were requested to fill out bid and bump sheets identifying the position they were seeking. The person with the most seniority and necessary qualifications for the position would be chosen. A committee evaluated each application and an applicant was required to gain the consensus of the members of the committee before being selected for a position.

¶14 At first, Kneeland attempted to bid into the positions of plant maintenance and mobile maintenance at the Yellowstone Mine. However, those positions were filled by applicants with more seniority than Kneeland. He then attempted to bump into the position of underground mechanic at the Beaverhead Mine. That position was not vulnerable to bumping and his application was rejected. He also attempted to bump into the position of underground mine support at the Beaverhead Mine, but was unsuccessful because he lacked the published minimum qualifications for that position. Kneeland made no other attempt to bid upon or bump into any other position for which he was eligible. Therefore, after the application process was over, Kneeland was laid off in a reduction in force from Luzenac in mid-1994.

¶15 In July 1994, after the workforce reduction, Luzenac acquired Montana Talc Company, a competitor with a mine site adjacent to the Yellowstone Mine facility. Due to the acquisition, Luzenac hired five individuals whom they had recently terminated. Kneeland was not one of those hired back to work for Luzenac.

¶16 On September 27, 1994, Kneeland filed a complaint in the Fifth Judicial District Court, Madison County, alleging wrongful discharge and related tort claims, including conspiracy. He also alleged a claim based on "post-termination bad faith," arising out of Luzenac's failure to reinstate, recall, or rehire him after acquiring the Montana Talc Company. On November 1, 1994, Luzenac filed its answer to the complaint, denying the allegations and setting forth numerous affirmative defenses.

¶17 On December 1, 1995, Luzenac filed motions, moving for summary judgment against all of Kneeland's claims. Kneeland filed a motion to recover sanctions, alleging that Luzenac violated Rule 11 by moving for summary judgment on all claims. A hearing was held and the parties stipulated that the claim based on civil conspiracy should be dismissed.

¶18 On February 6, 1996, the court granted summary judgment to Luzenac on Kneeland's claims of intentional infliction of emotional distress and post-termination bad faith. The court denied summary judgment on Kneeland's wrongful discharge claim, finding that "a factual issue exists as to whether there has been a violation of express provisions of a written personnel policy in reduction of force." The court also denied Kneeland's request for the imposition of attorney fees and sanctions against Luzenac.

¶19 On February 13, 1996, Kneeland filed a petition for reconsideration of the court's ruling on summary judgment relating to Kneeland's claim for post-termination bad faith. In the alternative, Kneeland requested that the court certify the claim as final pursuant to Rule 54(b), M.R.Civ.P., in order for this Court to review the issue. The District Court granted the motion to certify and postponed any further action on the case pending a ruling by this Court.

¶20 Kneeland filed a "notice of certification of proposition of state law" with this Court on February 26, 1996. We issued an order on February 29, 1996, stating that Kneeland's request would be handled as an appeal of a judgment pursuant to Rule 54(b), but that we would not rule on the propriety of the Rule 54(b) certification at that time. Luzenac then filed a motion to dismiss the appeal, arguing that the requirements for Rule 54(b) certification had not been met. We agreed, and on March 28, 1996, this Court dismissed Kneeland's appeal pursuant to Rule 54(b).

¶21 A jury trial began on October 15, 1996, on Kneeland's wrongful discharge claim. On October 21, 1996, the jury return a unanimous verdict for Luzenac. Judgment was entered on October 31, 1996. On November 1, 1996, Kneeland filed a motion for judgment as a matter of law, ¹ or alternatively, motion for a new trial. On November 29, 1996, the District Court denied Kneeland's motion.

¶22 On December 30, 1996, Kneeland filed a notice of appeal. Kneeland now appeals from the order of summary judgment dismissing his claim of post-termination bad faith, the final judgment and jury verdict, and from the order denying his post-trial motion.

ISSUE 1

¶23 Did the District Court err in granting summary judgment to Luzenac on Kneeland's claim of post-termination bad faith?

¶24 Our standard of review in appeals from summary judgment rulings is de novo. See Motarie v. Northern Montana Joint Refuse Disposal Dist. (1995), 274 Mont. 239, 242, 907 P.2d 154, 156; Mead v. M.S.B., Inc. (1994), 264 Mont. 465, 470, 872 P.2d 782, 785. When we review a district court's grant of summary judgment, we apply the same evaluation as the district court based on Rule 56, M.R.Civ.P. See Bruner v. Yellowstone County (1995), 272 Mont. 261, 264, 900 P.2d 901, 903. In Bruner, we set forth our inquiry:

The movant must demonstrate that no genuine issues of material fact exist. Once this has been accomplished, the burden then shifts to the non-moving party to prove, by more than mere denial and speculation, that a genuine issue does exist. Having determined that genuine issues of material fact do not exist, the court must then determine whether the moving party is entitled to judgment as a...