Olinger v. General Heating & Cooling Co.

• Decision Date: 08 November 1994
• Docket Number: No. WD,WD
• Citation: Olinger v. General Heating & Cooling Co., 896 S.W.2d 43 (Mo. App. 1994)
• Court: Missouri Court of Appeals
• Parties: Jane OLINGER, Respondent, v. GENERAL HEATING & COOLING CO., Appellant. 47865.

Page 43

896 S.W.2d 43

Jane OLINGER, Respondent, v. GENERAL HEATING & COOLING CO., Appellant.

No. WD 47865.

Missouri Court of Appeals Western District.

Nov. 8, 1994.

Motion for Rehearing and/or Transfer to

Supreme Court Denied Dec. 27, 1994.

William M. Modrcin, S. Margene Childress, Kansas City, for appellant.

Rik N. Siro, Blumer Nally & Siro, Kansas City, for respondent.

Before ULRICH, P.J., and LOWENSTEIN and SPINDEN, JJ.

ULRICH, Presiding Judge.

Defendant General Heating and Cooling Company (GHC) appeals the judgment entered in behalf of plaintiff Jane Olinger for retaliatory discharge. The jury awarded Ms. Olinger $14,048 in actual damages and $86,000 in punitive damages and judgment in those sums was entered.

GHC alleges several points on appeal. It contends that the court erred (1) in allowing Ms. Olinger to submit her claim for wrongful discharge to the jury, (2) in permitting the introduction into evidence of GHC's guilty plea in the ancillary federal criminal case, (3) in allowing a claim for punitive damages, (4) in refusing to admit GHC's mitigating evidence in the punitive damage portion of the trial, and (5) in permitting Olinger to testify about Pam Oberholtz's statement.

The judgment of the trial court is affirmed.

GHC is a wholesale distributor of commercial and residential heating and cooling units. In 1989, the company employed approximately 135 people. GHC routinely operated advertising and rebate promotions for Carrier/Bryant (Carrier), a manufacturer of heating and cooling units. For several years, Carrier was GHC's largest product line. Pursuant to terms and conditions established by Carrier, GHC could qualify for sales rebates paid by Carrier.

Ms. Olinger worked for GHC for several years, and her duties varied. She began working for GHC on August 1, 1985, as a mail room/literature clerk. She consistently received annual salary increases and year-end bonuses. In or around November 1988, Ms. Olinger was transferred to the rebate and advertising department where she was trained by Pam Oberholtz, her supervisor, to process rebate claims under the Carrier rebate program.

When Ms. Olinger was required to prepare and submit false rebate claims, she voiced concern about the illegality of the claims not only to fellow employees but also to her current and former supervisors. As the number of false rebates increased, Ms. Olinger discussed the rebate scheme with a friend who was an FBI agent. Ultimately, she began assisting the FBI in its investigation.

Before GHC learned about the FBI investigation, GHC transferred Ms. Olinger out of rebate and advertising and returned her to her previous position as mail room/literature clerk.

In early October 1989, the FBI conducted a surprise raid on GHC and indicated that it had an informant. Ms. Olinger immediately became the object of suspicion, and she experienced threats of personal harm and property damage. On October 19, 1989, GHC placed her on leave of absence of an undetermined duration. She was the only employee placed on leave during the investigation.

The FBI investigation resulted in the U.S. Attorney's filing a criminal charge against GHC in U.S. District Court, Western District of Missouri. GHC pleaded guilty to one count of mail fraud on March 16, 1990, for having used the mails in furtherance of the scheme to defraud Carrier in connection with the Carrier rebate program. As a consequence of GHC's conduct, Carrier terminated its distributorship agreement with GHC on March 28, 1990.

GHC fired Ms. Olinger effective March 30, 1990. Seeking an explanation for her firing, Ms. Olinger requested a Service Letter. GHC responded almost two months later, stating that Ms. Olinger's "continued employment would have had a negative effect on company morale and productivity."

On June 25, 1990, Ms. Olinger filed suit for wrongful discharge against GHC. Following the conclusion of the evidence, the jury returned its verdict and judgment was entered on behalf of Ms. Olinger. From this judgment, GHC appeals.

I.

As point one on appeal, GHC contends that the trial court erred in allowing Ms. Olinger's claim for wrongful discharge to be submitted to the jury. GHC contends that the evidence failed to establish a causal connection between Ms. Olinger's discharge and her activity as an FBI informant.

In determining whether the plaintiff made a submissible case, this court must view the evidence in the light most favorable to the plaintiff, according her the benefit of all reasonable inferences. Haynam v. Laclede Elec. Co-Op., Inc., 827 S.W.2d 200, 205 (Mo. banc 1992). The appellant's evidence is disregarded except insofar as it may aid the plaintiff's case. Nettie's Flower Garden v. SIS Inc., 869 S.W.2d 226, 231 (Mo.App.1993). Furthermore, "[t]he evidence and inferences must establish every element and not leave any issue to speculation." Id.

Simply because an essential element is proven by circumstantial evidence does not mean it is subject to speculation. "[A] finding essential to recovery may be proved by circumstantial evidence," Boyle v. Vista Eyewear, Inc., 700 S.W.2d 859, 866 (Mo.App.1985), but "the shown circumstances must be such that the facts necessary to support the finding may be inferred and reasonably must follow." Stark v. American Bakeries, Co., 647 S.W.2d 119, 125 (Mo. banc 1983).

The employment-at-will doctrine provides that an employer can discharge an at-will employee ¹ at any time for cause or without cause. Boyle v. Vista Eyewear, Inc., 700 S.W.2d at 870-71. The public policy ² exception to the at-will employment doctrine "provides that an at-will employee who has been discharged by an employer in violation of a clear mandate of public policy has a cause of action against the employer for wrongful discharge." Id. at 871. This narrow exception protects employees who do not have bargaining power to command employment contracts but are "entitled to a modicum of judicial protection when their conduct as good citizens is punished by their employers." Clark v. Beverly Enterprises-Missouri, Inc., 872 S.W.2d 522, 525 (Mo.App.1994) (quoting Sheets v. Teddy's Frosted Foods, Inc., 179 Conn. 471, 427 A.2d 385, 388 (1980)).

Thus, although employers have a right to terminate an employee at-will without cause, no right exists to terminate such an employee for an unlawful reason or purpose that contravenes public policy. ³ Clark v. Beverly Enterprises, 872 S.W.2d at 525. Most recently, Clark articulates the four circumstances pursuant to which an employee at-will has a cause of action for wrongful discharge in tort for damages. These four circumstances involve discharging the employee because the employee (1) refused to perform an illegal act; (2) reported wrongdoing or violations of law or public policy by the employer or fellow employees; (3) acted in a manner public policy would encourage such as seeking public office, accepting jury duty, asserting a right to elect or designate a collective bargaining representative or joining a labor union; or (4) filed a worker's compensation claim. Id.

Ms. Olinger's claim falls within the second category, the whistleblowing exception. In order for her to prevail on her claim for retaliatory discharge, she must prove that GHC discharged her because she reported to public authorities serious misconduct that constitutes a violation of law. Since the employer is unlikely to admit that retaliation is its motive for firing a "whistleblower," proof of this causal connection is by indirect or circumstantial evidence. Wiedower v. ACF Industries, Inc., 715 S.W.2d 303 (Mo.App.1986).

The jury could reasonably infer from this circumstantial evidence that Ms. Olinger's discharge was wrongful and that GHC's avowal of Ms. Olinger's negative effect on company morale and productivity in its Service Letter was pretextual. "Even though an employer produces evidence of a legitimate reason for the employee's discharge, the plaintiff who is able to persuade the jury that the employer's reason is pretextual and not causal is entitled to the verdict." Wiedower v. ACF Industries, Inc., 715 S.W.2d at 307.

Ms. Olinger showed she was a good worker whose work product was appreciated by her employer. She received annual pay raises and bonuses. Prior to the FBI investigation when she was no longer needed in the rebate department, GHC chose to transfer her back to her prior position as mail room/literature clerk rather than terminate her employment. Although she had expressed concern about the legality of the rebate scheme to her superiors and to her fellow employees, GHC took no action against her until after the FBI raided the company and told GHC that it had an informant. Ms. Olinger was suspected and immediately became the target of threats and accusations. Those persons who made threats against her were not placed on leave. Ms. Olinger was the only employee placed on leave during the FBI investigation of GHC. She was the only employee involved in the fraudulent operation to be fired.

Although GHC asserted that it eliminated Ms. Olinger's job to reduce overhead by "downsizing," the evidence supported the jury's apparent conclusion that this was pretextual. Ms. Olinger was fired two days after Carrier canceled its distributorship agreement with GHC. GHC's service letter omitted downsizing as a reason for Ms. Olinger's discharge. None of the other employees who participated or acquiesced in the illegal activity were fired. Consequently, the trial court did not err in submitting the wrongful discharge claim to the jury.

Point one is denied.

II.

As point two on appeal, GHC claims it should be granted a new trial because evidence of its guilty plea to mail fraud had no probative value and substantially prejudiced the proceedings.

The admissibility of evidence lies within the sound discretion of the trial court and, due to the subjective nature of such a determination, will not be disturbed absent an abuse of discretion....