McGhee v. Shelby Cnty. Gov't

• Decision Date: 11 June 2012
• Docket Number: No. W2012-00185-COA-R3-CV,W2012-00185-COA-R3-CV
• Parties: MICHAEL MCGHEE v. SHELBY COUNTY GOVERNMENT
• Court: Tennessee Court of Appeals

MICHAEL MCGHEE v. SHELBY COUNTY GOVERNMENT

No. W2012-00185-COA-R3-CV

COURT OF APPEALS OF TENNESSEE AT JACKSON

Assigned on Briefs May 17, 2012

Filed June 11, 2012

Appeal from the Circuit Court for Shelby County

No. CT-001410-11 Robert Weiss, Judge

This is a breach of contract case. Appellant, a former employee of Appellee Shelby County, filed suit against Shelby County for alleged breach of a settlement agreement. Specifically, Appellant alleges that Shelby County breached the contract by failing to change Appellant's employment record to reflect that he resigned, rather than that he was fired, and/or by informing Appellant's potential employer that Appellant was fired. Shelby County filed a motion to dismiss on the ground that the six-year statute of limitations for breach of contract actions had expired. The trial court granted the motion to dismiss. We conclude that: (1) the contract is severable; (2) Appellant's cause of action for Shelby County's breach of its obligation to change his employment records was correctly dismissed on the statute of limitations ground; (3) Appellee's contractual obligation to answer employment inquiries pursuant to the terms of the contract was not implicated until the condition precedent occurred (i.e., until inquiry was made by a third-party); and (4) the breach of this obligation accrued when Shelby County disseminated information counter to that contemplated in the settlement agreement. Accordingly, the Appellant's claim that Shelby County violated the express terms of the settlement agreement in 2010 by informing the Appellant's potential employer that he was fired is not barred by the applicable statute of limitations. Affirmed in part, reversed in part, and remanded.

Tenn. R. App. P. 3. Appeal as of Right; Judgment of the Circuit Court Affirmed in

Part; Reversed in Part; and Remanded

J. STEVEN STAFFORD, J., delivered the opinion of the Court, in which ALAN E. HIGHERS, P.J., W.S., and DAVID R. FARMER, J., joined.

Darrell J. O'Neal, Memphis, Tennessee, for the appellant, Michael McGhee.

Martin W. Zummach, Germantown, Tennessee, for the appellee, Shelby County Government.

OPINION

On September 2, 1998, Appellant Michael McGhee was "released" from his position as a patrolman with the Shelby County Sheriff's Department, a division of Shelby County Government ("Shelby County," or "Appellee").¹ After Mr. McGhee unsuccessfully appealed the disciplinary decision to the Civil Service Merit Board, he continued the appellate process in the chancery court. While the appeal to the chancery court was pending, on January 6, 2000, Mr. McGhee and Shelby County entered into a settlement agreement and release (the "Contract"). The Contract provides, in relevant part, that:

1. McGhee shall immediately take such steps as are reasonably necessary to withdraw and terminate any further appeals of disciplinary action taken against him by the Shelby County Sheriff's Department.

2. Contemporaneous with the execution of this Agreement and Release, McGhee shall furnish to Shelby County, a written letter of resignation as an employee of Shelby County.

3. Following the execution of this Agreement, Shelby County shall make such adjustments and/or corrections to the employment records of McGhee so as to reflect his resignation from Shelby County effective September 2, 1998.

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7. Shelby County covenants that henceforth, any employment inquiries in connection with McGhee shall be answered by furnishing only the dates of employment; the beginning and ending salary; and, the fact that McGhee resigned effective September 2, 1998.²

The instant appeal is based upon alleged breaches of the Contract on the part of Shelby County. Mr. McGhee filed his original complaint for breach of contract on March 23, 2011; an amended complaint was filed on April 18, 2011. In relevant part, the amended complaint avers that:

13. The [Contract] stated: "Following the execution of this [Contract], Shelby County shall make such adjustments and/or corrections to the employment record of McGhee so as to reflect his resignation from Shelby County effective September 2, 1998.

14. The [Contract] also stated, "Shelby County covenants that henceforth, any employment inquiries in connection with McGhee shall be answered by furnishing only the dates of employment; the beginning and ending salary; and the fact that McGhee resigned effective September 2, 1998."

15. On or about June 4, 2010, [Mr. McGhee] applied for a position with the Memphis Police Department. . . .

16. [Mr. McGhee] was told . . . that despite his successful application process, he did not pass a background approval because his permanent employee record from [Shelby County] reflected that [Mr. McGhee] had been terminated from his employment.

17. [Shelby County, in the Contract,] agreed to represent only the following upon inquiry about [Mr. McGhee's] employment record: (i) the date of when he began employment with the law enforcement agency, (ii) the date [Mr. McGhee] resigned from his employment and (iii) salary information.

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19. [Mr. McGhee's] permanent record with [Shelby County] wrongfully reflect[s] a termination instead of his voluntary resignation, as the contract requires, [and this fact] has barred [Mr. McGhee] from finding other means of employment within any law enforcement agency or security employment.

20. In 2003 [Shelby County] was given notice that [Mr. McGhee's] employment records reflected a termination, rather than voluntary resignation.

21. As of June 2010 [Mr. McGhee's] employment records still reflect a termination, rather than voluntary resignation.

Based upon the foregoing averments, and because Mr. McGhee did not receive an offer of employment from the Memphis Police Department ("MPD") in 2010, Mr. McGhee claims that Shelby County breached the Contract as follows:

25. [Shelby County] intended to bring about or cause the breach by refusing to adhere to the terms of the [Contract], namely the representation that [Mr. McGhee] resigned, and instead, misrepresented that [Mr. McGhee] was terminated from his employment.

26. [Shelby County's] refusal to abide by the terms of the agreement resulted in a malicious misrepresentation of [Mr. McGhee's] employment record with [Shelby County].

27. The Contract was in fact breached when [Shelby County] failed to convey the information agreed upon and stated to the [MPD] that [Mr. McGhee] had been terminated.

28. [Shelby County's] actions were the legal cause of the breach.

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31. [Shelby County] was made aware in writing in 2003 that [Mr. McGhee's] employment record had not been corrected pursuant to the [Contract].

32. In complete defiance and gross disregard, [Shelby County] refused to change [Mr. McGhee's] permanent employment record.

On June 20, 2011, Shelby County answered the amended complaint, denying the material allegations contained therein, and specifically raising, as an affirmative defense, the expiration of the statute of limitations applicable under the Governmental Tort Liability Act, Tennessee Code Annotated Section 29-20-101, et seq.³

On July 29, 2011, Mr. McGhee filed a motion to recuse or disqualify the lawyer representing Shelby County on the ground that the lawyer would likely be called as a witness at trial. Also on July 29, 2011, Mr. McGhee filed a motion to strike Shelby County's answer, and specifically the affirmative defenses raised therein, on the ground that the answer violated Tennessee Rule of Civil Procedure 8.02 for lack of specificity. These two motions were supported by memoranda of law.

On August 5, 2011, Shelby County filed a Tennessee Rule of Civil Procedure 12 motion to dismiss, wherein it argued, in relevant part, that:

2. [P]ursuant to T.C.A. §28-3-109, the statute of limitations is six years for allegations sounding solely in contract.

3. In the case at hand, the Amended Complaint filed against Shelby County was filed on April 18, 2011. Earlier, on March 23, 2011, [Mr. McGhee] filed a "Verified Complaint" against the Shelby County Sheriff's Department.

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5. In the case at hand, [Mr. McGhee] alleges that he was terminated from the Shelby County Sheriff's Office on or aboutSeptember 2, 1998.

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7. [Mr. McGhee] states at page 4, paragraph 20 the following:

In 2003 [Shelby County] was given notice that [Mr. McGhee's] employment records reflected a termination, rather than a voluntary resignation.

8. While [Mr. McGhee] is not specific on what date in 2003 this notice to [Shelby County] provided by [Mr. McGhee] occurred, by [Mr. McGhee's] own statement contained with his Complaint, the statute of limitations to bring suit under the longest limitations period of six years would have expired in

2009.

9. Inasmuch as the earliest the lawsuit against Shelby County . . . was ever brought was March 23, 2011, the Complaint was fatally doomed from the start.

Mr. McGhee opposed the motion to dismiss. In addition, on September 27, 2011, Mr. McGhee filed a motion for partial summary judgment, asserting that Shelby County undisputedly divulged, to the MPD, that Mr. McGhee was fired, and thereby breached the Contract.

By order of November 30, 2011, the trial court granted Shelby County's motion to dismiss on the ground that the statute of limitations had expired. Mr. McGhee filed a timely notice of appeal. Upon review of the appellate record, this Court determined that the order appealed was not a final judgment. Specifically, the trial court failed to rule on three of Mr. McGhee's motions: (1) the July 29, 2011 motion to recuse or disqualify Shelby County's lawyer; (2) the July 29, 2011 motion to strike Shelby County's answer; and (3) the September 27, 2011 motion for partial summary judgment. Tenn. R. App. P. 3(a) (stating that, "if . . . multiple claims for relief are involved in an action, any order that adjudicates fewer than all the claims . . . is not enforceable or appealable and is subject to revision at any time . . . ."). On May 18, 2012, this Court entered an order, requiring Mr. McGhee to...