Romano v. Rockwell Internat., Inc.

• Decision Date: 16 December 1996
• Docket Number: No. S050290,S050290
• Citation: 14 Cal.4th 479,59 Cal.Rptr.2d 20,926 P.2d 1114
• Court: California Supreme Court
• Parties: , 926 P.2d 1114, 72 Fair Empl.Prac.Cas. (BNA) 1052, 70 Empl. Prac. Dec. P 44,596, 65 USLW 2487, 133 Lab.Cas. P 58,247, 12 IER Cases 449, 96 Cal. Daily Op. Serv. 9058, 96 Daily Journal D.A.R. 15,014 William P. ROMANO, Plaintiff and Appellant, v. ROCKWELL INTERNATIONAL, INC., Defendant and Respondent.

Page 20

59 Cal.Rptr.2d 20

14 Cal.4th 479, 926 P.2d 1114,

72 Fair Empl.Prac.Cas. (BNA) 1052,

70 Empl. Prac. Dec. P 44,596, 65 USLW 2487,

133 Lab.Cas. P 58,247, 12 IER Cases 449,

96 Cal. Daily Op. Serv. 9058,

96 Daily Journal D.A.R. 15,014

William P. ROMANO, Plaintiff and Appellant, v. ROCKWELL INTERNATIONAL, INC., Defendant and Respondent.

No. S050290.

Supreme Court of California.

Dec. 16, 1996.

Shaw & Weitz, John R. Shaw and Mark S. Weitz, Los Alamitos, for Plaintiff and Appellant.

Quackenbush & Quackenbush and William C. Quackenbush, San Mateo, as amici curiae on behalf of Plaintiff and Appellant.

Paul, Hastings, Janofsky & Walker, Michael A. Hood, Eric C. Sohlgren, Paul C. Cane, Jr., Glenn L. Briggs, Robert P. Bryant and Brent R. Bohn, Costa Mesa, for Defendant and Respondent.

GEORGE, Chief Justice.

In this case we consider when the statute of limitations begins to run in a wrongful termination case in which the plaintiff has alleged causes of action sounding in contract and tort, as well as violations of the California Fair Employment and Housing Act. (Gov.Code § 12900 et seq.; FEHA.) The Court of Appeal concluded that the statute of limitations begins to run on all the alleged causes of action on the date employment actually is terminated, but defendant asserts, primarily on the basis of related federal authority, that the statute of limitations should run from the date the employee is informed unequivocally that his or her employment will be terminated. For the reasons explained below, we conclude that the Court of Appeal was correct, and that its judgment should be affirmed.

I

Plaintiff William P. Romano was employed by defendant Rockwell International, Inc. (Rockwell), for 29 years. His last position with the company was as the director of human resources of Rockwell's digital communications division. He generally received excellent performance reviews. He was aware beginning in 1987, however, that he had displeased Gilbert Amelio, president of Rockwell's communications systems division, in his handling of a personnel matter that occurred in the company's London office. (The latter division apparently governed the operations of the digital communications division.)

On December 6, 1988, Rockwell's communications systems vice-president, Gary Collins, Romano's immediate superior, informed Romano that Amelio, who was Collins's superior, desired that Romano's employment be terminated. Collins explained that Amelio insisted that Romano accept a one-year teaching fellowship, followed by retirement. Collins proposed that under the circumstances, Romano agree to pursue a teaching fellowship until he reached 85 service points under the company retirement plan and thereupon became eligible for early retirement, and that he then retire. Collins asked Romano to contact him as soon as possible. When Romano suggested he needed legal counsel, Collins advised him not to be hasty, and to think about the proposal and give him a response as soon as possible. Romano understood in December 1988 that Rockwell intended to terminate his employment when he reached 85 points, which would occur May 31, 1991, and that the company was offering no option other than immediate termination. If he retired immediately, he would lose half the pension benefits he otherwise would receive in the event he achieved 85 service points under the company retirement plan.

Romano contacted Collins in January 1989 to work out details of the plan. A written plan for a teaching fellowship followed by retirement at 85 service points was developed, although it appears Romano never signed it. At various points Romano complained that he did not want to retire and was being ruined, and made some efforts to secure a reversal of the termination decision, to no avail. Romano previously had been successful in fighting off a demotion, and had some hope he could outlast Amelio and survive as a company employee.

Romano's replacement was not hired until December 5, 1989. In the meantime, Romano continued to serve at his post. Romano was 57 years of age, and his replacement 43. After the replacement arrived, Romano served at another post within the company until June 1, 1990, when the planned teaching fellowship began. Romano signed the necessary forms and retired from Rockwell on May 31, 1991. From December 6, 1988, until his retirement in 1991, Romano continued to receive his full salary, in addition to a sum intended to reflect bonus pay for which he was no longer eligible.

On September 18, 1991, Romano filed a complaint with the Department of Fair Employment and Housing, alleging retaliatory termination and age discrimination. On September 21, 1991, the Department of Fair Employment and Housing issued a notice of case closure in the matter, recognizing Romano's right to bring a civil action. On December 9, 1991, Romano filed a complaint in superior court, naming Rockwell and Gilbert Amelio, as well as various unnamed persons, as defendants. The complaint alleged (1) wrongful termination in violation of public policy, (2) retaliatory termination in violation of Government Code section 12940, subdivision (f), (3) age discrimination in violation of Government Code section 12941, (4) breach of implied contract, (5) breach of the implied covenant of good faith and fair dealing, and (6) intentional interference with contractual relations. (The last cause of action was alleged against defendant Amelio alone. Amelio was not a party to this appeal, nor was the sixth cause of action the subject of Rockwell's motion to dismiss on statute of limitations grounds. Accordingly, we do not consider whether this cause of action was time-barred.)

Romano alleged that his employment was terminated because he had complained about and opposed Amelio's unethical and illegal personnel practices (including nepotism and employment terminations in violation of state law and company policy), and also because of his age. He alleged additionally the existence of an implied contract not to terminate his employment absent good cause, asserting that good cause did not exist for the termination.

Defendant Rockwell sought summary judgment on the ground that all the claims alleged against it were time-barred under the applicable statutes of limitations. It asserted the following limitations periods applied. As to the first cause of action for termination in violation of public policy, it asserted the one-year limitation period set out in Code of Civil Procedure section 340 applied. As to the second and third causes of action, involving claims arising under FEHA, Rockwell claimed Romano had failed to file a complaint with the Fair Employment and Housing Department within one year, as required by Government Code section 12960. As to the fourth and fifth causes of action, involving claims of breach of implied contract and breach of the covenant of good faith and fair dealing, Rockwell asserted that the two-year limitation period of Code of Civil Procedure section 339 applied. Although plaintiff did not dispute that each limitations period applied, the parties disagreed as to when the statutes of limitations began to run. Rockwell argued they began to run on December 6, 1988, when it notified Romano his employment would be terminated. Romano maintained, in contrast, that the statutes of limitations began to run on May 31, 1991, when his employment actually terminated.

The trial court granted defendant's motion for summary judgment on the ground that all claims were barred by the statutes of limitations invoked by Rockwell. At the hearing on the motion, the court declared that the applicable limitations periods began to run "at the time that the employer said, 'we're going to fire you.' "

The Court of Appeal reversed, concluding that the limitations period applicable to wrongful termination claims begins to run upon actual termination, rather than when the employee is informed unequivocally that discharge is inevitable. The Court of Appeal observed that to require the employee to file a lawsuit while he or she still is employed would destroy any possibility that the employer might rescind the termination decision. It added that to hold the statute of limitations runs from the time of notification of termination would allow employers to create a situation in which employees would be likely to sleep on their claims, and ultimately lose them under the statute of limitations. Finally, the Court of Appeal pointed out that its decision would provide clarity and predictability to litigants, because the date of actual termination rarely would be subject to dispute.

II

A.

Summary judgment is granted only when the papers presented in support of the moving party establish that no issue of material fact exists to be tried and the moving party is entitled to judgment as a matter of law. (Code Civ.Proc., § 437c, subd. (c); Mann v. Cracchiolo (1985) 38 Cal.3d 18, 35, 210 Cal.Rptr. 762, 694 P.2d 1134; Villa v. McFerren (1995) 35 Cal.App.4th 733, 741, 41 Cal.Rptr.2d 719.) On appeal, the reviewing court exercises its independent judgment, deciding whether the moving party established undisputed facts that negate the opposing party's claim or state a complete defense. (Jambazian v. Borden (1994) 25 Cal.App.4th 836, 844, 30 Cal.Rptr.2d 768; Torres v. Reardon (1992) 3 Cal.App.4th 831, 836, 5 Cal.Rptr.2d 52; see also Spann v. Irwin Memorial Blood Centers (1995) 34 Cal.App.4th 644, 649, 40 Cal.Rptr.2d 360; Code Civ.Proc., § 437c, subd. (n).)

The applicable statute of limitations does not begin to run until the cause of action accrues, that is, " 'until the party owning it is entitled to begin and prosecute an action thereon.' " (Spear v. California State Auto. Assn. (1992) 2 Cal.4th 1035, 1040, 9 Cal.Rptr.2d 381, 831 P.2d 821.) The Code of Civil Procedure makes this explicit: "Civil actions, without exception, can only be commenced within the periods prescribed in this title, after the cause of...