Strauss v. A. L. Randall Co.

• Decision Date: 16 June 1983
• Citation: 194 Cal.Rptr. 520,144 Cal.App.3d 514
• Court: California Court of Appeals Court of Appeals
• Parties: , 37 Fair Empl.Prac.Cas. (BNA) 1531, 33 Empl. Prac. Dec. P 34,275 Edgar STRAUSS, Jr., Plaintiff and Appellant, v. A.L. RANDALL CO., INC., Defendant and Respondent. Civ. 68513.

Page 520

194 Cal.Rptr. 520

144 Cal.App.3d 514, 37 Fair Empl.Prac.Cas. (BNA) 1531,

33 Empl. Prac. Dec. P 34,275

Edgar STRAUSS, Jr., Plaintiff and Appellant, v. A.L. RANDALL CO., INC., Defendant and Respondent.

Civ. 68513.

Court of Appeal, Second District, Division 5, California.

June 16, 1983.

As Modified July 6, 1983.

Hearing Denied Aug. 10, 1983.

Robinson & Wood, Inc. and Christian B. Nielsen, San Jose, for plaintiff and appellant.

Pillsbury, Madison & Sutro, San Jose, and Walter R. Allan, San Francisco, Thomas P. O'Donnell, San Jose, and John M. Grenfell, San Francisco, for defendant and respondent.

FEINERMAN, Presiding Justice.

Plaintiff, Edgar Strauss, Jr. (Strauss) appeals from a judgment of dismissal entered following an order sustaining the general demurrer of defendant A.L. Randall Co., Inc. (Randall) to the first count of the complaint without leave to amend.

In considering an appeal from a judgment of dismissal entered after the sustaining of a demurrer to a complaint, a reviewing court must regard the allegations as true and assume that plaintiff can prove all of the facts as alleged. (Dale v. City of Mountain View (1976) 55 Cal.App.3d 101, 105, 127 Cal.Rptr. 520.)

Strauss entered into an oral agreement of employment with Randall in 1962. For 17 years he worked for Randall as a salesman of wholesale floral supplies in California, Nevada, and Arizona. In November of 1979 he was notified that his employment would be terminated the following month. Strauss asserts that his discharge was "wrongful and without just cause in that the reason for plaintiff's dismissal was his age." He was 55 years old at the time he was terminated. Plaintiff at all times has been ready, willing and able to perform all conditions of his employment agreement.

Strauss' complaint sets forth two purported causes of action. The first was an action for the common law tort of wrongful discharge, based upon an alleged violation of public policy, discrimination in employment because of the employee's age. The second count alleged age discrimination, in violation of former Labor Code section 1420.1. ¹ Randall demurred to the first count on the basis that Strauss had failed to state facts sufficient to constitute a cause of action. It demurred to the second count on the ground that plaintiff had failed to exhaust his administrative remedies under the statute. The trial court sustained, without leave to amend, the demurrer to count I and overruled the demurrer to count II. Strauss then voluntarily dismissed, without prejudice, the complaint as to count II only, and subsequently refiled that complaint. He then moved for a judgment of dismissal as to count I. A judgment of dismissal was entered, and plaintiff now appeals from that judgment.

Labor Code section 2922 codifies the traditional common law rule regarding employment termination. It states: "An employment, having no specified term, may be terminated at the will of either party on notice to the other." However, two exceptions have long been made to this rule. A contract of employment can be terminated only for good cause if either (1) the contract was supported by consideration independent of the services to be performed by the employee, or (2) the parties agreed, expressly or impliedly, that the employee could be terminated only for good cause. (Rabago-Alvarez v. Dart Industries, Inc. (1976) 55 Cal.App.3d 91, 96, 127 Cal.Rptr. 222.)

In addition, our courts have allowed a cause of action for wrongful discharge where such discharge was in violation of public policy. Such cases include Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167, 164 Cal.Rptr. 839, 610 P.2d 1330 (discharge because of employee's refusal to engage in illegal price fixing activities), Hentzel v. Singer Co. (1982) 138 Cal.App.3d 290, 188 Cal.Rptr. 159 (discharge for attempt to obtain a healthy environment in which to work) and Montalvo v. Zamora (1970) 7 Cal.App.3d 69, 86 Cal.Rptr. 401 (discharge for designating a representative in employment negotiations and for exercising rights under the California Minimum Wage Law).

Two recent decisions have further extended employees' rights. These decisions are rooted in two concepts: (1) termination of employment without legal cause offends the implied-in-law covenant of good faith and fair dealing contained in all contracts and (2) an employee has a right to rely upon an employer's conduct giving rise to an implied promise that it would not act arbitrarily in dealing with its employees. (Pugh v. See's Candies, Inc. (1981) 116 Cal.App.3d 311, 329, 171 Cal.Rptr. 917 (32-year employment coupled with commendations and promotions, lack of criticism of the employee's work, and assurances by the company over the years that the employee would never be discharged except for good cause); Cleary v. American Airlines, Inc., (1980) 111 Cal.App.3d 443, 455, 168 Cal.Rptr. 722 (employee engaged in union activities was discharged, without a hearing, for alleged theft after 18 years of allegedly satisfactory services; the employer had adopted specific procedures, applicable to other classes of employees, for adjudicating employee disputes).)

Former Labor Code section 1411, a part of the Fair Employment Practices Act (FEPA), stated: "It is hereby declared as the public policy of this state that it is necessary to protect and safeguard the right and opportunity of all persons to seek, obtain, and hold employment without discrimination or abridgment on account of race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, sex, or age." Section 1420.1 further declared that "[i]t is an unlawful employment practice for an employer to refuse to hire or employ, or to discharge, dismiss, reduce, suspend, or demote, any individual over the age of 40 on the ground of age, except in cases where the law compels or provides for such action." Section 1421 et seq. mandated the procedure which the aggrieved employee must follow if he chose to pursue his complaint. He had a right to file a verified complaint in writing with the Division of Fair Employment Practices in the Department of Industrial Relations within the specified time. The division was obligated to endeavor to eliminate the unlawful employment practice through conference, conciliation and persuasion. If this could not be accomplished, the division had authority to issue an accusation setting forth the nature of the charges, and the employer was required to answer the charges at a hearing. If an accusation was not issued within 150 days after the filing of a complaint, or if the division earlier determined that it would not issue an accusation, the aggrieved employee could bring a civil action against the employer.

Section 1420.1 created a new right for plaintiffs over 40 who alleged that they were discriminated against in employment because of their age. "[T]he prohibitions on employment discrimination contained in the FEPA are in no sense declaratory of preexisting common law doctrine but rather include areas and subject matters of legislative innovation, creating new limitations on an employer's right to hire, promote or discharge its employees." (Gay Law Students Assn. v. Pacific Tel. & Tel. Co. (1979) 24 Cal.3d 458, 490, 156 Cal.Rptr. 14, 595 P.2d 592.) Section 1420 et seq. created a statutory remedy for the infringement of that right. "Where a new right is created by statute, the party aggrieved by its violation is confined to the statutory remedy if one is provided...." (Palo Alto-Menlo Park Yellow Cab Co. v. Santa Clara County Transit Dist. (1976) 65 Cal.App.3d 121, 131, 135 Cal.Rptr. 192; County of Monterey v. Abbott (1888) 77 Cal. 541, 18 P. 113; see 2 Witkin, Cal. Procedure (2d ed. 1970) p. 885.) Our courts have allowed exceptions to this rule only when the statutory remedy has been found inadequate. (See, e.g. Orloff v. Los Angeles Turf Club (1947) 30 Cal.2d 110, 113, 180 P.2d 321.)

We conclude that Strauss' right to file a private civil action is demarcated by statute. Hentzel v. Singer Company, supra, 138 Cal.App.3d 290, 188 Cal.Rptr. 159, cited by appellant, is distinguishable from the case at bench. There, the court identified a long standing state policy in favor of promoting a safe and healthful work environment. This policy predated the enactment of a statutory remedy. Thus, the availability of a statutory remedy did not destroy Hentzel's common law remedy. In reaching this conclusion, the court noted that "[t]he remedial scheme under [the California Occupational Safety and Health Act] is distinguishable from that under the California Fair Employment and Housing Act (Gov.Code, § 12900 et seq.), where exhaustion of remedies in a similar situation may well be required. [Citation.] The latter statute provides a comprehensive scheme or administrative enforcement through the Department of Fair Employment and Housing, whose function is to investigate, conciliate, and seek redress of complained of discrimination,...