McCart v. J. Walter Thompson USA, Inc.

• Decision Date: 08 April 1991
• Docket Number: No. 87309,No. 4,87309,4
• Citation: 437 Mich. 109,469 N.W.2d 284
• Parties: Dennis McCART, Plaintiff-Appellee, v. J. WALTER THOMPSON USA, INC., Defendant-Appellant. Calendar437 Mich. 109, 469 N.W.2d 284, 121 Lab.Cas. P 56,875, 6 Indiv.Empl.Rts.Cas. (BNA) 577
• Court: Michigan Supreme Court

Page 284

469 N.W.2d 284

Dennis McCART, Plaintiff-Appellee, v. J. WALTER THOMPSON USA, INC., Defendant-Appellant.

No. 87309.

Calendar No. 4.

437 Mich. 109, 469 N.W.2d 284, 121 Lab.Cas. P 56,875,

6 Indiv.Empl.Rts.Cas. (BNA) 577

Supreme Court of Michigan.

Argued Oct. 2, 1990.

Decided April 5, 1991.

Separate opinion by LEVIN, J., April 8, 1991.

Eric J. McCann, Bloomfield Hills, for plaintiff-appellee.

Bodman, Longley & Dahling, by James J. Walsh, David P. Larsen, Detroit, (Richard Pollet, J. Walter Thompson, U.S.A., Inc., New York City, of counsel), for defendant-appellant J. Walter Thompson U.S.A., Inc.

Mark Granzotto, Detroit, Monica Farris Linkner, Berkley, Charles P. Burbach, Southfield, for amicus curiae.

Miller, Canfield, Paddock and Stone, Diane M. Soubly, John H. Willems, Detroit, for amici curiae American Soc. of Employers; Motor Vehicle Mfrs. Ass'n of U.S., Inc.; Greater Detroit Chamber of Commerce; and Michigan State Chamber of Commerce.

Clark, Klein & Beaumont, by Dwight H. Vincent, J. Walker Henry, Rachelle G. Silberberg, Jennifer S. Buckley, Detroit, for Michigan Mfrs. Ass'n amicus curiae.

Conboy, Fell, Stack, Lieder & Hanson, Lloyd C. Fell, Cheboygan, for amicus curiae General Motors Corp.

OPINION

MICHAEL F. CAVANAGH, Chief Justice.

Defendant J. Walter Thompson U.S.A., Inc., appeals from the Court of Appeals decision reversing the trial court's grant of defendant's motion for summary disposition under MCR 2.116(C)(10). 181 Mich.App. 611, 450 N.W.2d 10 (1989). This Court granted defendant's application for leave to appeal, limited to the following questionsS [PUB#PG=0000542,111] "(1) whether there was a genuine issue of fact as to whether plaintiff's employment was terminated for economic reasons only, and (2) assuming there was a genuine issue of fact regarding the reason(s) for the plaintiff's discharge, was that factual issue material." 434 Mich. 911 (1990).

We find that plaintiff failed to show the existence of a genuine issue of fact material to his wrongful discharge claim. Plaintiff conceded that defendant was discharging employees because of economic hardship, and presented no evidence, in response to defendant's summary disposition motion and supporting evidence, sufficient to raise a jury question whether defendant discharged him for bona fide economic reasons.

Accordingly, we reverse.

I. FACTS

Plaintiff was senior vice-president for defendant at the time of his termination in November 1986. He had been with defendant continuously since 1976, working the last eight years on an advertising account with Burger King Corporation. At the time of his termination, plaintiff was account director for Burger King field marketing, with an annual salary of $111,140 as of 1985. Although he resided and worked out of defendant's offices in Michigan, he was part of defendant's New York office.

Defendant informed plaintiff that his position was being eliminated as part of a work-force reduction. ¹ Plaintiff was notified of his termination by his immediate supervisor, Robert Norsworthy. A few days later, plaintiff received a letter signed by defendant's corporate officer, Stephen Bowen, plaintiff that his employment would be discontinued. ² Plaintiff filed a complaint against defendant in April 1987, alleging: (1) plaintiff had an oral contract for employment that could only be terminated for just cause, (2) plaintiff was fired without cause, and (3) plaintiff's discharge was in breach of his contract with defendant. Defendant's answer included the affirmative defense that plaintiff had been terminated as a part of its work-force reduction.

After discovery, defendant filed a motion for summary disposition, alleging pursuant to MCR 2.116(C)(10) that no genuine issue of material fact existed regarding whether plaintiff's employment was terminated as part of a work-force reduction. In support of the motion, defendant offered the deposition testimony of plaintiff and Bowen, and documentary evidence relating to plaintiff's employment history and a Burger King restaurant franchisee application. Bowen's testimony cited economic factors affecting the company, efforts to reduce the work-force in unprofitable areas, and the nonessential nature of plaintiff's position.

For purposes of its motion only, defendant conceded that plaintiff had an oral contract of permanent employment terminable only for good cause. Additionally, defendant allowed that plaintiff's performance was not at issue. Defendant contended nonetheless that it was entitled to judgment because plaintiff's position was eliminated for economic reasons as part of the work-force reduction, and, therefore, his termination was for nonactionable just cause as a matter of law.

In opposition to defendant's motion, plaintiff contended that (1) plaintiff's termination had "nothing to do with the reduction in work-force," but was actually a punitive discharge by Bowen, (2) plaintiff had a lifetime good-cause employment contract, (3) Norsworthy would testify "in support of Plaintiff's case, and will verify the facts contained herein," (4) defendant attempted to disguise the true nature of plaintiff's discharge by doing it in the course of a work layoff, (5) plaintiff was offered a bonus and raise shortly before his termination, indicating his value to the company and, in a typical work-force reduction, a highly paid and valued employee would not be let go, and (6) "numerous factual disputes" existed such as the terms of the contract, the reason for discharge, and the method utilized by defendant to accomplish the discharge. Plaintiff conceded, however, that defendant was, at the time, reducing its work-force for economic reasons.

The trial court granted defendant's motion for summary disposition. Citing MCR 2.116(G)(4), which requires that the adverse party on a motion for summary disposition must introduce additional evidence beyond its pleadings and briefs to show there is a genuine issue of material fact, the court held: "Plaintiff has failed to provide any evidentiary support for his claim that he was laid off for punitive reasons and not economic reasons."

The Court of Appeals reversed, reasoning that although "there is nothing in the record to indicate that plaintiff's position was terminated for reasons other than economic motivation," 181 Mich.App. at 616, 450 N.W.2d 10, the evidence did not show that plaintiff was hired only for the one position he had held, and that plaintiff had cited certain incidents which allegedly contributed to Bowen's dislike of him. The Court held that "the employer must establish economic motivation to terminate the particular employee, as opposed to the employee's position, where the employee has a just cause contract and the employer has reasonable alternative options for the employee within the organization." Id. at 617-618, 450 N.W.2d 10. The Court concluded that "[b]ecause we are unable to say that it will be impossible for plaintiff to factually support his position at trial, we hold that the grant of summary disposition was inappropriate." Id. at 618, 450 N.W.2d 10.

II. ANALYSIS

Plaintiff argues that this Court's decision in Toussaint v. Blue Cross & Blue Shield of Michigan, 408 Mich. 579, 292 N.W.2d 880 (1980), governs this dispute. In Toussaint, this Court held that an employee may have an enforceable right not to be terminated except for just cause, grounded in either an express oral or written contract or in legitimate expectations arising from an employer's policy statements. See id. at 598-599, 292 N.W.2d 880. We conclude, however, as the Court of Appeals has held, that bona fide economic reasons for discharge constitute "just cause" under Toussaint. See Friske v. Jasinski Builders, Inc., 156 Mich.App. 468, 472, 402 N.W.2d 42 (1986); Bhogaonker v. Metropolitan Hosp., 164 Mich.App. 563, 565-566, 417 N.W.2d 501 (1987). ³

In the instant case, while plaintiff alleges that Bowen disliked him, he has failed to raise any genuine issue of fact regarding the validity of defendant's proofs that adverse business conditions existed and that the elimination of plaintiff's position was necessitated by those conditions. Indeed, plaintiff conceded that defendant was instituting layoffs for economic reasons at the time. The objective circumstances, as presented by defendant's proofs, indicate no more than a termination resulting from an economically motivated work-force reduction.

"When properly challenged, plaintiff must establish that he has a case on the law and that there are some evidentiary proofs to support his allegations as to any material fact." Durant v. Stahlin, 375 Mich. 628, 638, 135 N.W.2d 392 (1965). Under MCR 2.116(G)(4), a party opposing a motion for summary disposition is required to respond with affidavits or other evidentiary materials to show the existence of a factual dispute, rather than relying on the allegations or denials in the pleadings. In this case, plaintiff did not specify any facts in opposition to defendant's motion in any "[a]ffidavits, depositions, admissions, or other documentary evidence," MCR 2.116(G)(3), instead simply stating in his responsive pleading that he would produce at trial evidence that defendant's economic necessity rationale was a pretext. ⁴

This case thus stands in marked contrast to the recent Court of Appeals decision in Ewers v. Stroh Brewery Co., 178 Mich.App. 371, 443 N.W.2d 504 (1989), where "plaintiff relied on deposition and documentary evidence which he argued indicated that defendant was experiencing substantial economic growth and operating at a substantial profit before and after his discharge." Id. at 375, 443 N.W.2d 504. Because plaintiff failed to carry his burden under MCR 2.116(G)(4), we need not address the issue discussed by the Court of Appeals regarding whether the defendant must demonstrate economic reasons not only for the elimination of a just-cause employee's position, but for the termination of the employee as an...