Martinez v. City of Grants

• Decision Date: 22 November 1996
• Docket Number: No. 23521,23521
• Citation: 122 N.M. 507,927 P.2d 1045,1996 NMSC 61
• Parties: Eileen M. MARTINEZ, Plaintiff-Appellee, v. CITY OF GRANTS and Willie R. Alire, City Manager in his individual capacity, Defendants-Appellants.
• Court: New Mexico Supreme Court

Page 1045

927 P.2d 1045

122 N.M. 507

Eileen M. MARTINEZ, Plaintiff-Appellee, v. CITY OF GRANTS and Willie R. Alire, City Manager in his individual capacity, Defendants-Appellants.

No. 23521.

Supreme Court of New Mexico.

Nov. 22, 1996.

[122 N.M. 509] Gallagher, Casados & Mann, P.C., Gail Stewart, Albuquerque, for Defendants-Appellants.

Vernon W. Salvador and Kent Winchester, Albuquerque, for Plaintiff-Appellee.

OPINION

RANSOM, Justice.

1. Eileen Martinez (hereinafter "Martinez" or "Eileen") sued the City of Grants and, in his individual capacity, former city manager Willie Alire. She alleged that she had been terminated from her job as city clerk in violation of the New Mexico Human Rights Act, NMSA 1978, §§ 28-1-1 to -7, 28-1-9 to -14 (Repl.Pamp.1991 & Cum.Supp.1995), and in violation of her rights to free speech under the United States and New Mexico Constitutions. At the close of Martinez's case Defendants moved for a directed verdict on the free-speech claims, arguing that Martinez had failed to present evidence that she had engaged in speech touching on a matter of public concern. They also moved for a directed verdict on Martinez's claim against Alire for punitive damages based on the violation of her rights to free speech. The trial court denied the motions, and Defendants proceeded with their case. At the close of all the evidence Defendants renewed their motions for directed verdict, which again were denied.

2. Prior to submission of this case to the jury, Martinez's free-speech claim under the New Mexico Constitution was withdrawn and her Human Rights Act claim against Alire was dismissed such that, when the case was submitted to the jury, two theories of recovery remained: a First Amendment free-speech claim against the City for compensatory damages and against Alire both for compensatory and punitive damages; and a Human Rights Act claim against the City for compensatory damages alone. The jury returned a verdict in favor of Martinez on all her claims and awarded compensatory damages of $146,016 against both Defendants and punitive damages of $151,635 against Alire. The trial court entered judgment accordingly, after which Defendants moved for judgment notwithstanding the verdict or, in the alternative, a new trial or remittitur. The trial court denied these motions, and Defendants appealed to the Court of Appeals.

3. Because Martinez originated this case by filing a complaint with the Human Rights Division of the New Mexico Department of Labor pursuant to the New Mexico Human Rights Act, and because this Court has exclusive jurisdiction over appeals from district court orders and judgments involving that Act, § 28-1-13(C), the Court of Appeals transferred this case to us, see NMSA 1978, § 34-5-10 (Repl.Pamp.1990) (transfer of erroneously docketed appeals). Alire and the City (as Alire's indemnitor) seek reversal only of the award of punitive damages. We conclude that Martinez presented substantial evidence of protected speech. Nevertheless, because the instructions allowed the jury to consider items of unprotected speech as a basis upon which it could find for Martinez, we remand for a new trial on the issue of punitive damages.

4. Facts and proceedings. Martinez worked as city clerk for the City of Grants from August 1986 until she was terminated on March 9, 1993. Willie Alire worked as city manager beginning in August 1991 and directly supervised Martinez. The positions of city clerk and city manager are appointed positions created by state statute. NMSA 1978, § 3-12-4(A) (Repl.Pamp.1995) (providing that municipality shall create appointive office of clerk); NMSA 1978, § 3-13-3 (Repl.Pamp.1995) (providing that municipalities with populations of one thousand or more persons may create appointive position of manager). The basic duties of a city clerk include keeping custody of all minutes, ordinances, and resolutions; attending all meetings; recording all minutes, ordinances, and resolutions; and, upon request, furnishing copies of all municipal records. NMSA 1978, § 3-13-1(A) (Repl.Pamp.1995). The duties of a city manager include acting as chief administrative officer; enforcing and carrying out all ordinances, rules, and regulations; employing and discharging all administrative employees; preparing and submitting an annual budget; and making recommendations to the city council on matters concerning the municipality's welfare. NMSA 1978, § 3-14-14 (Repl.Pamp.1995).

5. Problems surfaced between Martinez and Alire almost immediately after Alire assumed the position of city manager. Martinez testified that prior to Alire's arrival she had developed good working relationships with other personnel in the city offices, including Roberta Martinez, the secretary to the city manager, and Paula Chavez, the city personnel manager, but that these relationships deteriorated soon after Alire's arrival. She also testified that Kathy Gallegos, a temporary employee directly supervised by Roberta Martinez, developed an "attitude problem" shortly after Alire's arrival insofar as Gallegos did not help Eileen when asked to do so.

6. The problems between Martinez and Alire began in earnest in October 1991. After returning from an international conference of clerks in Canada, Martinez noticed the formation of what she termed a clique, from which she felt excluded. When she discussed this with Alire he told her that everything had gone smoothly during her absence and that everyone had gotten along fine. Martinez understood this to mean that she must be the problem. Further, Alire told Martinez that Kathy Gallegos was "there to stay" when Martinez complained to him about her.

7. Martinez also testified that in late October or early November 1991 she received phone calls from three different persons inquiring about out-of-town business trips Alire had taken with Kathy Gallegos. These persons wanted to know why a temporary employee was making such important trips. Martinez testified that she did not indicate to any of these callers that something untoward was going on. Martinez reported these three calls to Alire who became very upset with her. Alire told Martinez the trips were none of her business and presented her with a memorandum which he instructed her to read to anyone inquiring about his business trips.

8. Martinez believes that by November or December 1991 Alire hated her. As evidence of this hatred Martinez cited several incidents occurring at that time. For example, her November 9 calendar entry reads "Willie accused me of leaking information to [news reporter] Charlotte Fellers--not true." Her December 9 calendar entry reads "Willie accused me of rumors I did not even know about."¹ Finally, at the 1991 Christmas party Alire gave Kathy Gallegos and Roberta Martinez "beautiful" necklaces while he gave Eileen and other employees in the city offices bottles of wine. Martinez believed that Alire gave preferential treatment to all women in the office with the exception of her. For example, Kathy Gallegos was allowed to use a city vehicle and to arrive on the job late and leave early. Roberta Martinez was given a $9000 raise allegedly because she dressed "less conservatively" than Eileen.

9. The incident which Martinez believes irreparably damaged any working relationship she may have had with Alire, and to which she attributes Alire's retaliatory harassment and her eventual termination, occurred in January 1992. Martinez testified that on January 23 she entered Alire's office quickly after knocking on the door. She alleges that she witnessed Alire and Kathy Gallegos preparing to kiss, which conclusion she drew from their closeness and her observation that Gallegos had her arms around Alire. Martinez also testified that although she was surprised by what she had just seen she did not at that time tell anyone about it other than her husband and her priest.

10. As evidence of Alire's retaliatory harassment following the January 23 incident, Martinez introduced several memoranda addressed to her from Alire. Further examples of harassment cited by Martinez included asking her to do unorthodox things, such as changing minutes that had already been approved; calling her "a little shit"; throwing papers at her; and accusing her of withholding a check from the fire department. Alire also allegedly made fun of her lipstick and described her to others in the office as "the mushroom in the dark." Finally, during a disagreement over proposed changes to Martinez's job description, Alire allegedly twice poked Martinez in the collarbone.

11. In addition to protesting Alire's preferential treatment of Kathy Gallegos to Alire himself, Martinez protested his favoritism to the mayor, city council members, an EEOC investigator, and an investigator hired by the city to resolve some of the problems related to Alire and the executive department. In a memorandum on personnel matters issued by the mayor on September 10, 1992, the mayor set forth that he and the council had come to certain decisions and recommendations, including the following general reference to Martinez's protests of favoritism: "The City Clerk will apologize to the City Manager and to his secretary, Kathy Gallegos, in writing for communicating gossip alleging a relationship between the manager and his secretary."

12. In his notice of termination, Alire listed six numbered reasons for terminating Martinez on March 9, 1993. Alire testified that his first reason, "fomenting discontent," was meant, in part, to refer to the fact Martinez talked to other people about his favoritism. He stated that he resented her going to the mayor and council about favoritism, among many other things. Another reason for terminating Martinez, "making false statements and false accusations," referred to Martinez's complaints to the mayor and council about preferential treatment. "Making continued threats at exposing the City Manager through [photographs which are...