Lukoski v. Sandia Indian Management Co.

• Decision Date: 07 January 1988
• Docket Number: No. 16462,16462
• Citation: 1988 NMSC 2,748 P.2d 507,106 N.M. 664
• Parties: , 2 Indiv.Empl.Rts.Cas. (BNA) 1650 Scott J.L. LUKOSKI, Plaintiff-Appellee, v. SANDIA INDIAN MANAGEMENT COMPANY, Defendant-Appellant.
• Court: New Mexico Supreme Court

Page 507

748 P.2d 507

106 N.M. 664, 2 Indiv.Empl.Rts.Cas. (BNA) 1650

Scott J.L. LUKOSKI, Plaintiff-Appellee, v. SANDIA INDIAN MANAGEMENT COMPANY, Defendant-Appellant.

No. 16462.

Supreme Court of New Mexico.

Jan. 7, 1988.

[106 N.M. 665] Grammer & Grammer, David A. Grammer, III, Albuquerque, for defendant-appellant.

Turpen & Wolfe, Donald C. Turpen, Albuquerque, for plaintiff-appellee.

OPINION

RANSOM, Justice.

Scott J.L. Lukoski brought a wrongful discharge action against his employer, Sandia Indian Management Co. (SIMCO). Lukoski had been employed as general manager of the Sandia Pueblo bingo operation. In a bench trial, the court decided that SIMCO violated the termination procedures prescribed for "less serious" offenses by an employee handbook. For salary due on the remaining term of his one-year oral contract, Lukoski was awarded $18,629.05. We affirm.

The court found that, in October 1983, Lukoski and SIMCO entered into a one-year oral employment agreement under which Lukoski would provide services as the general manager of a bingo hall operation for a specified annual salary plus commission. There was no written agreement between the parties. In February 1984, SIMCO distributed to all employees an employee handbook and requested each to sign the last page as verification of receipt, acknowledgement of acceptance, and agreement to conform with the stated policies and procedures. After Lukoski signed the back page as requested, it was placed in his personnel file. The court concluded that:

The parties amended the oral employment contract * * * when [SIMCO] proffered, and [Lukoski] signed, [the] Employee's Handbook containing new duties and obligations on the part of employee and employer over and above said oral contract, including Rules to be obeyed by [Lukoski] and a termination procedure to be followed by [SIMCO].

Although we determine the above-quoted language is a finding of ultimate fact, rather than a conclusion of law, that is of no consequence. See Hoskins v. Albuquerque Bus Co., 72 N.M. 217, 382 P.2d 700 (1963); Wiggs v. City of Albuquerque, 57 N.M. 770, 263 P.2d 963 (1953). SIMCO challenges this finding and for the first time on appeal raises two other issues. First, it claims that Lukoski, as general manager, was not the type of employee intended to be covered by the handbook. Distribution to all employees with request for signatures constituted evidence to the contrary, and resolution of any ambiguity regarding management personnel would have been a specific question of fact. See Shaeffer v. Kelton, 95 N.M. 182, 619 P.2d 1226 (1980). Second, SIMCO claims that any breach was not material because it neither went to the substance of the contract nor defeated the object of the parties. Materiality is likewise a specific question of fact. See Bisio v. Madenwald (In re Estate of Bisio), 33 Or.App. 325, 576 P.2d 801 (1978). As the contract stood after amendment, it was not materiality, as argued by SIMCO, but rather severity of offense that was at issue under the termination procedures. In any event, by failing to tender requested findings, SIMCO waived specific findings on these fact issues. SCRA 1986, 1-052(B)(1)(f).

There is substantial evidence supporting the court's findings of ultimate fact that the termination procedures became an amendment to Lukoski's contract, and that personality--not the severe offenses of insubordination or disobedience--was the cause for termination. He was terminated without warning or suspension for a cause not so severe as to constitute cause for immediate termination. His personality and interpersonal dealings were found by the court to create an atmosphere of fear and anxiety and bad morale among employees and managers.

Relying only on Ellis v. El Paso Natural Gas Co., 754 F.2d 884 (10th Cir.1985), the thrust of SIMCO's appeal is that the language of the employee handbook is "too indefinite to constitute a contract" and lacks "contractual terms which might evidence the intent to form a contract." It maintains that the parties did not conduct themselves as if the employee handbook was to govern Lukoski or as if they expected it to form the basis of a contractual relationship. In support of its position, SIMCO refers to the disciplinary action, suspension, and warning provisions,¹ and argues that the language of the termination policy is ambiguous and contains no required policy for termination.

SIMCO's argument, however, overlooks the handbook's characterization of the disciplinary policy regarding warnings, suspensions and terminations as "an established procedure regarding suspension of problem employees and termination for those who cannot conform to Company Policy." (Emphasis added.) Moreover, the language of the handbook does nothing to alert an employee against placing reliance on any statement contained therein or against viewing such discipline and termination policy as only a unilateral expression of SIMCO's intention that is subject to revocation or change at any time, in any manner, at the pleasure of SIMCO. To the contrary, from the language of the handbook and the conduct of SIMCO in adopting the policy, it could properly be found that the policy was part of the employment agreement.

Whether an employee handbook has modified the employment relationship is a question of fact "to be discerned from the totality of the parties' statements and actions regarding the employment relationship." Wagenseller v. Scottsdale Memorial Hosp., 147 Ariz. 370, 383, 710 P.2d 1025, 1038 (1985) (en banc).

Evidence relevant to this factual decision includes the language used in the personnel manual as well as the employer's course of conduct and oral representations regarding it. We do not mean to imply that all personnel manual will become...