Sowards v. Norbar, Inc., 89AP-1326

• Decision Date: 05 March 1992
• Docket Number: No. 89AP-1326,89AP-1326
• Citation: 605 N.E.2d 468,78 Ohio App.3d 545
• Parties: , 10 IER Cases 1287 SOWARDS, Appellee, v. NORBAR, INC., Appellant.
• Court: Ohio Court of Appeals

Page 545

78 Ohio App.3d 545

605 N.E.2d 468, 10 IER Cases 1287

SOWARDS, Appellee, v. NORBAR, INC., Appellant.

No. 89AP-1326.

Court of Appeals of Ohio, Tenth District, Franklin County.

Decided March 5, 1992.

Bidwell & Beachler Co., L.P.A., Jinx Statler Beachler and David M. Bidwell, Columbus, for appellee.

Ennis, Roberts & Fischer Co., L.P.A., and J. Michael Fischer, Cincinnati, for appellant.

L. ALAN GOLDSBERRY, Judge.

Appellant, Norbar, Inc., appeals from a judgment of the Franklin County Common Pleas Court in favor of appellee, Charles E. Sowards.

On October 16, 1986, appellee was hired by Norbar, Inc., as an over-the-road truck driver. Shortly thereafter, appellee was given a Norbar driver's manual and signed an acknowledgement stating that he had received a copy. Appellee's primary duty was to deliver mail from Columbus to Washington, D.C. and, after a twelve-hour layover in Washington, D.C., return to Columbus with another shipment of mail. Appellee was one of six drivers assigned to the Grove City to Washington, D.C. route. During the twelve-hour layover in Washington, D.C., appellee stayed in a single occupancy hotel room permanently reserved by the company.

On August 14, 1987, appellee was terminated for missing stops at the southern Maryland bulk mail facility on August 5 and 7, 1987. These stops had been added to appellee's normal route only a few days earlier. Appellant claims that appellee was informed about the extra stop by a notice attached to his driver's clipboard at the Columbus facility. Appellee denied receiving this message or specifically being told to make the extra stop by any Norbar employee.

Following his termination, appellee filed a civil action in common pleas court against appellant for breach of employment contract and invasion of privacy. The jury returned a verdict in favor of the appellee; damages were assessed at $7,500 as compensation for the breach of contract claim, $50 in actual damages, and $10,000 punitive damages for invasion of privacy. Post-trial motions were filed with the trial judge, which resulted in affirmation of all actions of the jury, except for the contract damages finding. The $7,500 verdict for contract damages was remitted to $6,564.69 on October 12, 1989. Norbar, Inc., perfected its appeal in a timely manner setting forth the following seven assignments of error:

"I. The trial court erred in overruling defendant's motion for judgment notwithstanding the verdict and/or for a new trial on plaintiff's breach of contract claim.

"II. The judgment and verdict against defendant on plaintiff's breach of contract claim are contrary to law and against the manifest weight of the evidence.

"III. The trial court erred in refusing to charge the jury on defendant's written, requested instructions regarding the jury not substituting its judgment for defendant's if the jury found that defendant acted in good faith in terminating plaintiff.

"IV. The trial court erred in refusing to submit to the jury defendant's written, requested interrogatory regarding defendant's good faith in terminating plaintiff.

"V. The jury's general verdict conflicts with and is inconsistent with the jury's answers to interrogatories posed to the jury.

"VI. The trial court erred in overruling defendant's motion for judgment notwithstanding the verdict and/or a new trial on plaintiff's invasion of privacy claim.

"VII. The judgment and verdict against defendant on plaintiff's invasion of privacy claim are contrary to law and against the manifest weight of the evidence."

Appellee's brief, filed March 14, 1990, accepts appellant's "Statement of the Case." Therefore, the court will not restate the procedural history, except to note that a cross-appeal by appellee, Charles E. Sowards, was dismissed January 29, 1990, upon motion for voluntary dismissal by both parties.

Appellant's first, second and fifth assignments of error concern the breach of contract claim and require an interpretation of the employee handbook. We will consider these assignments of error jointly.

As a general rule, an employment relationship with no fixed duration is deemed at will, meaning the employee is free to seek work elsewhere and the employer may, at any time, terminate the employment relationship for any reason not contrary to law. Mers v. Dispatch Printing Co. (1985), 19 Ohio St.3d 100, 19 OBR 261, 483 N.E.2d 150. However, as an exception to the general rule, employee handbooks, company policy, and oral representations have been recognized in some situations as comprising components or evidence of employment contracts. See, e.g., Kelly v. Georgia-Pacific Corp. (1989), 46 Ohio St.3d 134, 545 N.E.2d 1244; and Helmick v. Cincinnati Word Processing, Inc. (1989), 45 Ohio St.3d 131, 543 N.E.2d 1212. Thus, an at-will employment contract may be modified by the provisions of an employee handbook where the parties manifest an intention to be bound by the terms therein. See Miller v. BancOhio Natl. Bank (Apr. 23, 1991), Franklin App. Nos. 90AP-380 and 90AP-551, unreported, 1991 WL 64907; Helle v. Landmark Inc. (1984), 15 Ohio App.3d 1, 15 OBR 22, 472 N.E.2d 765; Bolling v. Clevepak Corp. (1984), 20 Ohio App.3d 113, 20 OBR 146, 484 N.E.2d 1367.

Appellant does not contest that its driver's manual (the employee handbook) provides for a policy of progressive discipline. Rather, appellant claims that the language of the handbook is not binding upon the company and was not intended to form an employment contract.

The handbook sets forth the progressive disciplinary policy in relevant part as follows:

"FORMAL DISCIPLINE

"It is our sincere desire that all Employees who are presently with the Company will still be here for many years from now. Therefore, Company discipline is intended to be constructive and remedial whenever possible. Some violations of policy, most of which are set forth in this Driver's Manual, are so serious that they require immediate discharge. However, in most cases constructive discipline commences with a written warning. Do not take these warnings lightly. If you are warned in writing, it is your responsibility to correct the situation. Unless repetition of the offense is considered too serious for further constructive discipline, a disciplinary layoff results from a repeat offense. Further repetition will result in discharge; warnings are cumulative. The disciplinary process is as follows:

"1) Formal written warning for first offense.

"2) One week suspension for second offense.

"3) Discharge for third offense.

"In the event of an Employee receiving disciplinary warnings for more than one differing offense, the Company may elect to move to a more severe level of discipline without repetition of the same offense. An Employee's record shall be reduced by one disciplinary step of severity at six month intervals."

In addition to the above-cited disciplinary procedures, the handbook at issue employs a probationary period of ninety days in which an employee may be terminated for any reason without resort to the progressive discipline policy.

Appellant argues that the above-cited provisions are merely guidelines for employee discipline and were not intended to be binding upon the company. In upholding the jury's verdict, the trial court concluded the handbook was either the total embodiment of a contract agreed upon after appellant's provisional employment period or it constituted a final part of complete contract previously agreed to by both parties. In either case, the trial court concluded that its disciplinary provisions were binding on appellant and appellee. It may be that the handbook could be changed by the company upon notice to employees without their consent, but the evidence fully supports the finding the handbook was binding until so changed.

Significantly, the language used in the handbook with respect to "formal discipline" is both specific and mandatory, indicating that the formal discipline policy was intended to be more than a mere guideline for discipline. Furthermore, other testimonial evidence in the record supports this conclusion. Appellee testified that when he was given a copy of the employee handbook by John Hartman, Vice-President of the company, he was told that the company "lived by" the language of the handbook. Appellee further stated that he was required to sign a written acknowledgment stating that he had received a copy of the handbook. In addition, both Ron Funk, the company supervisor, and Gale Williams, the company dispatcher, testified that the company strictly adhered to the rules and regulations set out in the handbook and that the company expected its employees to comply. Based on this and other evidence in the record, it was reasonable for the jury to conclude that both parties agreed to be bound by the employee handbook and assented to its terms.

In his second assignment of error, appellant argues that in order for disciplinary rules to bind appellant, there had to be consideration from appellee. In answer to a specific interrogatory, the jury found consideration in appellee's commitment not to take additional employment, to keep a telephone, have clean clothing and bedding available at all times, and to follow in general the rules and regulations of the handbook. Essentially, the jury found that appellee's agreement to continue working for appellant under the specific provisions of the handbook after its issuance was legally sufficient consideration. Appellant contends that this finding is contrary to law. We disagree.

As a general rule of contract construction, courts will not inquire into the adequacy of consideration unless the absence of consideration is such as to constitute manifest unfairness or fraud. See, e.g., Ervin v. Garner (1971), 25 Ohio St.2d 231, 54 O.O.2d 361, 267 N.E.2d 769; Mooney v. Green (1982), 4 Ohio App.3d 175, 4 OBR 276, 446 N.E.2d 1135; Irving Leasing Corp. v. M & H Tire Co. (1984), 16 Ohio App.3d 191, 16 OBR 205...