Sorensen v. Comm Tek, Inc.

• Decision Date: 01 October 1990
• Docket Number: No. 17890,17890
• Citation: 799 P.2d 70,118 Idaho 664
• Parties: , 5 IER Cases 1301 Peter P. SORENSEN, Plaintiff-appellant, v. COMM TEK, INC., an Idaho corporation, Defendant-respondent.
• Court: Idaho Supreme Court

Page 70

799 P.2d 70

118 Idaho 664, 5 IER Cases 1301

Peter P. SORENSEN, Plaintiff-appellant, v. COMM TEK, INC., an Idaho corporation, Defendant-respondent.

No. 17890.

Supreme Court of Idaho.

Oct. 1, 1990.

Rehearing Denied Oct. 1, 1990.

Lojek & Gabbert, Boise, for plaintiff-appellant. Donald W. Lojek argued.

Hogue, Speck & Aanestad, Ketchum, for defendant-respondent. Tracy Dunlap argued.

SUBSTITUTE OPINION

The Court's prior opinion, dated May 22, 1990, is hereby withdrawn.

ON DENIAL OF PETITION FOR REHEARING

BAKES, Chief Justice.

This is an appeal in an action claiming a wrongful termination and breach of employment contract. Plaintiff appeals the district court's order granting defendant's motion for summary judgment.

I

The record, viewed most favorably to the appellant, reveals the following facts. In July, 1984, plaintiff appellant Peter P. Sorensen was hired by defendant Comm Tek, Inc., a magazine publishing firm. Throughout his career at Comm Tek Sorensen was rated highly by his supervisors. During the spring of 1987, Comm Tek began shifting some of its Boise employees to the Washington, D.C., area (Vienna, Virginia) where it was relocating a major portion of its operations in conjunction with the launching of a new magazine for owners of satellite earth stations, or "dishes."

Sorensen alleges that on or about April 27, 1987, Comm Tek president David Wolford made an express contractual offer to him for a management position in the Vienna office. According to Sorensen, the oral offer contained an express promise that if Sorensen was not satisfied with the Vienna position he would be entitled to return to his Boise position. Sorensen then voiced concerns about the increased relative cost of living in the Washington, D.C., area as compared with Boise, education for his children, and the difficulty of selling his Boise home. Wolford, according to Sorensen, assured him that if he took the new position he would receive a cost-of-living increase and a raise and that the details would be worked out later. Wolford told Sorensen that he had 24 hours to decide and to let Pam Waite, a company vice president, know of his decision. Sorensen notified Waite the next day that he accepted the offer.

Sorensen alleged that almost two months passed from the time of Sorensen's acceptance and "the details" had not been worked out. Sorensen had been unsuccessful in his attempts to meet with Wolford in order to arrive at specific terms and conditions relating to the Vienna position. Waite and other Comm Tek officials suggested that Sorensen put a proposal in writing, which he did prior to leaving on a scheduled trip to the Washington, D.C., area to look for housing. Sorensen's June 15, 1987, "INTERNAL MEMO" listed his proposals regarding the move to the Washington, D.C., area, including a suggested salary increase.

On June 17, 1987 Sorensen arrived in Washington, D.C., checked into his hotel, and found a message instructing him to call the Boise office first thing in the morning. When Sorensen called he was informed that he was fired. According to Jan Bagby, Comm Tek's human resources officer, Wolford lost his temper after reviewing Sorensen's memo and decided to "make an example" of Sorensen by firing him even though other Comm Tek officials advised against this action. Attempts by company officials to persuade Wolford to let Sorensen keep his Boise position were likewise fruitless.

On February 16, 1988, Sorensen filed a complaint for breach of contract and wrongful termination by "breach of the covenant of good faith and fair dealing" alleging that Comm Tek "arbitrarily dismiss[ed] Plaintiff for exercising his right to negotiate terms of salary and working conditions ... in contravention of public policy." On August 10, 1988, Sorensen filed an amended complaint which further alleged promissory estoppel as a theory of recovery.

Comm Tek moved for summary judgment and on November 9, 1988, the district court granted this motion. In its decision, the district court concluded:

[I]t is clear that the plaintiff was an employee-at-will.... Nothing in the record shows that Comm [Tek] ever offered to limit the reasons for discharge of Mr. Sorensen ... nor to provide that he be employed for a specific period of time. Thus even under the most favorable view of the facts, there is no agreement which limits the reasons for which he may be discharged.... While promissory estoppel would provide the necessary consideration for a contract, it will not supply the missing terms. The doctrine of promissory estoppel would not preclude the termination of Mr. Sorensen.

... If there was an implied covenant of good faith and fair dealing in employment contracts, this Court would find that a jury issue remained and would deny summary judgment. However, Idaho law, including the recent pronouncements of the Supreme Court and the Court of Appeals, dictates that the only result can be arrived at in this case is to grant the defendant's motion for summary judgment in spite of what appears to be the unfairness of the procedure used in this case.

On appeal Sorensen contends that the district court erred when it concluded that neither the record nor the law would support the following theories of Sorensen's complaint: (1) breach of oral employment contract, (2) breach of a public policy exception to the employment-at-will doctrine, and (3) breach of an implied-in-law covenant of good faith and fair dealing. Sorensen does not appeal the district court's decision granting Comm Tek summary judgment on the promissory estoppel issue.

II

We first address Sorensen's claim that the district court erred in granting summary judgment pursuant to I.R.C.P. 56(c) because there was sufficient admissible evidence in the record, when viewed in a light most favorable to the non-moving party, to show that a genuine issue of material fact exists concerning whether Comm Tek breached the alleged oral employment contract between himself and Comm Tek. Sorensen argues that the agreement he reached with Wolford on or about April 27, 1987, contained a specified duration on the length of his employment with Comm Tek and/or a limitation on the reasons for which Comm Tek could terminate him. Sorensen concludes that his previous at-will employment relationship with Comm Tek had been impliedly converted by the oral agreement into a contract with a term, and, as a result, Comm Tek wrongfully discharged him by dismissing him without good cause. ¹

This Court recently addressed the law applicable to claims involving the employment-at-will doctrine. In Metcalf v. Intermountain Gas Co., 116 Idaho 622, 778 P.2d 744 (1989), we stated:

As the result of numerous decisions of this Court in recent years, it is now settled law in this state that:

"Unless an employee is hired pursuant to a contract which specifies the duration of the employment or limits the reasons for which an employee may be discharged, the employment is at the will of either party and the employer may terminate the relationship at any time for any reason without incurring liability. MacNeil v. Minidoka Memorial Hospital, 108 Idaho 588, 701 P.2d 208 (1985); Jackson v. Minidoka Irrigation Dist., 98 Idaho 330, 563 P.2d 54 (1977)."

Spero v. Lockwood, Inc., 111 Idaho [74, 75], 721 P.2d , 175 (1986). Thus, in the absence of an agreement between the employer and the employee limiting the employer's (or the employee's) right to terminate the contract at will, either party to the employment agreement may terminate the relationship at any time for any reason without incurring liability. MacNeil v. Minidoka Memorial Hospital, 108 Idaho 588, 701 P.2d 208 (1985). However, such a limitation on the right of the employer (or the employee) to terminate the employment "can be express or implied." Harkness v. City of Burley, 110 Idaho 353, 356, 715 P.2d 1283, 1286 (1986). A limitation may be implied if, from all the circumstances surrounding the employment relationship, a reasonable person could conclude that both parties intended that the employer's (or the employee's) right to terminate the employment relationship-at-will had been limited by the implied-in-fact agreement of the parties. See, e.g., Spero v. Lockwood, Inc., 111 Idaho 74, 721 P.2d 174 (1986); Wagenseller v. Scottsdale Mem. Hospital, 710 P.2d 1025, 1036 (Ariz.1985) (en banc ) ("An implied-in-fact contract term ... is one that is inferred from the statements or conduct of the parties.") 1 A. Corbin, § 17, at 38 (1960).

Metcalf v. Intermountain Gas Company, 116 Idaho 622, 624, 778 P.2d 744, 746 (1989).

Sorensen claims that by accepting Comm Tek's offer for the Vienna job, with the understanding that if he were not satisfied with the new position he could return to his position in Boise, a new employment contract, or a modification of the previous employment-at-will relationship, was created. This contract, Sorensen alleges, impliedly limited Comm Tek's right to terminate him, at least between April 28, 1987, the date of acceptance, and August, 1987, the actual starting date for the new Vienna position. Sorensen has not asserted, however, that the new Vienna position was to be other than an employment-at-will relationship. Nor does Sorensen contend that the Boise position, if he chose to return to it, was to change from its previous character as that of employment-at-will. In essence then, Sorensen alleges that after he had accepted the oral contract offer for the Vienna position, and until he actually started in that position some three months later, Comm Tek could not discharge him without cause. This argument impliedly admits that Comm Tek could have done so, from either the Vienna or Boise positions, after August, 1987, because he was still an employee-at-will. As the district court correctly pointed out,

[E]ven under the most favorable view of the facts, there is no agreement which limits the reasons for which he may be discharged. Under the circumstances, Mr....