Town of South Padre Island v. Jacobs, 13-85-357-CV

• Decision Date: 26 November 1986
• Docket Number: No. 13-85-357-CV,13-85-357-CV
• Citation: 736 S.W.2d 134
• Parties: TOWN OF SOUTH PADRE ISLAND and Johnny Smith, Appellants, v. Fred R. JACOBS, Appellee.
• Court: Texas Court of Appeals

Page 134

736 S.W.2d 134

TOWN OF SOUTH PADRE ISLAND and Johnny Smith, Appellants, v. Fred R. JACOBS, Appellee.

No. 13-85-357-CV.

Court of Appeals of Texas Corpus Christi.

Nov. 26, 1986.

On Rehearing July 6, 1987.

Rehearing Denied Aug. 28, 1987.

Jim Denison, Roger W. Hughes, Harlingen, Paul Cunningham, South Padre Island, R. Gaines Griffin, Sawtelle, Goode, Davidson & Troilo, San Antonio, for appellants.

Thomas Sullivan, Denis A. Downey, Brownsville, for appellee.

Before BENAVIDES, UTTER, and SEERDEN, JJ.

OPINION

BENAVIDES, Justice.

This appeal arises from an alleged wrongful termination of employment.

Appellee began working as fire chief for the Town on December 1, 1980. Appellee had previously been a member of the Baltimore City Fire Department from 1951-1966. For the next ten years, he and his wife operated a shelter home for the Montgomery County Social Service in Maryland before moving to Texas in 1977. From 1977 to 1980, appellee was employed as fire marshall for the Town, responsible for inspecting new and existing constructions to evaluate compliance with the fire regulations. The Town initially had only a volunteer fire department, and in the Fall of 1980 began organizing a full-time paid fire department.

Appellee testified that in September 1980, the Town's then existing city manager, Kirby Lilljedahl, approached him and offered him the position of fire chief of the official City Fire Department to begin on December 1, 1980. As a condition of his employment, appellee testified that he was required to move from Los Fresnos to the Laguna Madre area. Appellee, although unable to sell his Los Fresnos home, purchased a house in Laguna Madre.

Appellee assumed the task of organizing the new fire department, drafting the Departmental Rules, Regulations, and Procedures, and hiring fire fighters for the department.

Johnny P. Smith assumed the duties as the Town's City Manager on June 1, 1982. On February 3, 1983, after an executive session with the Town Board of Aldermen, Smith informed appellee that his position was being terminated, effective two weeks from that date, February 16, 1983. Smith presented appellee with a copy of a memorandum he had written and was to give to the Board of Aldermen which formed the basis of this lawsuit.

Smith's memorandum contained the reasons why Smith did not believe Jacobs was performing his job as fire chief in a satisfactory manner, and therefore decided to terminate Jacobs' employment with the Town. The memorandum included such reasons as Jacobs' failure to report to work on time, his acceptance of a similar position in a neighboring town and use of the Town's vehicle in that capacity without permission, as well as several enumerated violations of the Departmental Rules, Regulations, and Procedures.

In answer to special issues, the jury found that appellee had entered into an employment contract with the Town of South Padre Island (the Town) for a certain time period, the ending date of the contract being December 31, 1983. The jury found that appellee's employment was terminable with cause, that the Town did not have cause to terminate appellee, that the Town materially breached the contract for employment, and that $26,000 represents the present cash value of the employment contract.

In reference to appellant Johnny P. Smith (Smith), the jury found that he had deprived appellee of his constitutional right to privacy and right to petition grievances without due process of law, while acting under color of state law, and awarded appellee actual damages of $5,000 for privacy deprivation and $5,000 for the deprivation of appellee's right to petition grievances.

In addition, the jury found that Smith did not act in good faith and in the course of his official duties as city manager with regard to appellee's termination, that certain material matters contained in a February 3, 1983, memorandum, written by Smith, were false, and that Smith, acting with actual malice, libeled and slandered appellee when he published the memorandum to the town Board of Aldermen or town employees. The jury found actual damages of $24,000 and exemplary damages as a result of the libel or slander against Smith in the amount of $50,000.

The trial court judgment assessed damages of $26,000 against the Town, $84,000 against Smith, and joint and several recovery of attorney's fees and court costs against appellants.

Appellants bring twenty-six points of error.

By their first two points of error, appellants claim that there is no evidence to support the jury's answers to Special Issues 1, 2, and 3, because the evidence conclusively establishes that appellee was an "at will" employee of the town, or, alternatively, the evidence is insufficient to support the answers and the jury's answers are therefore manifestly unjust. By points of error three, four and five, appellants claim that the jury's answers to Special Issues No. 4, 5 and 6 are immaterial because of appellee's "at will" status, or alternatively, there is no evidence or insufficient evidence to support the answers.

In considering a "no evidence" or "insufficient evidence" point of error, we will follow the well-established test set forth in Dyson v. Olin Corp., 692 S.W.2d 456 (Tex.1985); Glover v. Texas General Indemnity Co., 619 S.W.2d 400 (Tex.1981); Garza v. Alviar, 395 S.W.2d 821 (Tex.1965); Allied Finance Co. v. Garza, 626 S.W.2d 120 (Tex.App.--Corpus Christi 1981, writ ref'd n.r.e.); Calvert, No Evidence and Insufficient Evidence Points of Error, 38 Texas L.Rev. 361 (1960).

Appellee, in his Third Amended Original Petition, brought a cause of action for breach of contract, alleging a contract for: (1) a term of years extending until he reached age 65; (2) that if such contract was oral, it might have been performed within one year, and alternatively, (3) the contract was for a yearly term renewable each and every year in which [appellee] was paid a yearly salary. Appellee's petition goes on to state that:

Such contract was evidenced in writing, to wit, by checks disbursing a yearly wage to [appellee]. Accordingly, [appellee] says that he is entitled under this theory of employment contract, to wages owed from point of termination, February 16, 1983, until December 31, 1983.

Appellants and appellee agreed to a Pretrial Order which contains the following provisions:

A. As to the allegations of paragraph IX of Plaintiff's Third Amended Original Petition, Plaintiff shall be limited to proof of a contract which must be implied from the conduct of the Defendants and Plaintiff shall not be permitted to show an express contract to employ the Plaintiff until the age of 65 years since contrary to the Plaintiff's judicial admission that he had neither an oral or written contract to work for the TOWN OF SOUTH PADRE ISLAND, TEXAS, until he retired.

B. As to the allegations contained in Paragraph X of Plaintiff's Third Amended Original Petition wherein Plaintiff alleges a written contract until December 31, 1983, Plaintiff shall be limited to proof of such contract by proof of payroll checks payable to FRED JACOBS from the TOWN OF SOUTH PADRE ISLAND, TEXAS.

There was no evidence of any written agreement or contract, and no evidence of payment by the City of payroll checks to appellee, as provided by Paragraph B of the Pretrial Order. Appellee was never asked whether he had been employed until December 31, 1983. Appellee testified only that he was earning $21,280 per year as fire chief when he was terminated, paid bimonthly.

The record is devoid of any evidence which indicates the period of time for the existence of a contract between the Town and appellee. It is well settled in Texas that when an employment contract is oral and for no definite period of time, it is terminable at will by either party. Currey v. Lone Star Steel Co., 676 S.W.2d 205, 212 (Tex.App.--Fort Worth 1984, no writ). In addition, when the terms of employment are indefinite, the loss of wages that the employee would have earned in the indefinite future is not a recoverable item of damages. Reynolds Mfg. Co. v. Mendoza, 644 S.W.2d 536 (Tex.App.--Corpus Christi 1982, no writ). If any contract existed, it was terminable at will by the Town.

We note that public policy requires a narrow exception to the employment-at-will doctrine for an employee who was discharged for the sole reason that the employee refused to perform an illegal act. Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733 (Tex.1985). Nothing in the record indicates the necessity to explore this exception.

In addition, appellee admitted in his testimony that he drafted a departmental regulation which provides that any member of the fire department "may be discharged with or without cause." We sustain appellants' first through fourth points of error.

Points of error six and seven assert no evidence or insufficient evidence to support the jury's answer to Special Issue No. 7. In response to that special issue, the jury found $26,000 to be the present cash value of the employment contract between the Town and appellee, and as a result, the trial court awarded $26,000 against the Town.

A thorough search of the record reveals that Jacobs' might have been paid at most $21,800 per year. We find no evidence to support the $26,000 finding. Moreover, due to the "at will" status of Jacobs' employment, Jacobs was precluded from recovering these "lost" wages. Reynolds Mfg. Co. v. Mendoza, 644 S.W.2d at 539. We find nothing in the record to support the $26,000 damage award for loss of employment on breach of contract against the Town. Appellants' sixth point of error is sustained.

In his Third Amended Original Petition, appellee claims that he was deprived of his right of privacy and right to petition grievances in violation of his United States Constitutional rights and 42 U.S.C. § 1983 (1986). He asserts that he was denied counsel, was not given the opportunity to call witnesses on his behalf, to present...