Warden v. Ohio Dep't of Natural Res.

• Decision Date: 09 January 2014
• Docket Number: No. 13AP–137.,13AP–137.
• Citation: 7 N.E.3d 533
• Parties: Richard WARDEN, Plaintiff–Appellee/Cross–Appellant, v. OHIO DEPARTMENT OF NATURAL RESOURCES, Defendant–Appellant/Cross–Appellee.
• Court: Ohio Court of Appeals

7 N.E.3d 533

Richard WARDEN, Plaintiff–Appellee/Cross–Appellant,

v.OHIO DEPARTMENT OF NATURAL RESOURCES, Defendant–Appellant/Cross–Appellee.

No. 13AP–137.

Court of Appeals of Ohio,

Tenth District, Franklin County.

Jan. 9, 2014.

Mowery Youell & Galeano, Ltd., and Merl H. Wayman, Dublin, for appellee/cross-appellant.

Michael DeWine, Attorney General, Randall W. Knutti, Columbus, and Emily M. Simmons, for appellant/cross-appellee.

O'GRADY, J.

{¶ 1} Defendant-appellant/cross-appellee, Ohio Department of Natural Resources (“ODNR”), and plaintiff-appellee/cross-appellant, Richard Warden, appeal from a judgment of the Court of Claims of Ohio finding ODNR liable for age discrimination under R.C. Chapter 4112 and awarding Warden damages. For the following reasons, we affirm in part, reverse in part, and remand for further proceedings consistent with this decision.

I. FACTS AND PROCEDURAL HISTORY

{¶ 2} Warden is a registered professional engineer who ODNR employed for 29.5 years. In October 2006, at the age of 51, Warden accepted a two-year buyout and retired from his position as a Natural Resources Engineer 4 in the Mineral Resources Management (“MRM”) division at ODNR. Subsequently, the General Assembly enacted legislation that required ODNR to prepare an estimate of the cost to reclaim coal mining sites if the coal mining operator forfeited. To comply with the legislation, the MRM division had to create a program that could perform the estimates. In 2007, MRM Division Chief John Husted asked Warden to resume employment with ODNR on an intermittent basis to develop the required program. Warden agreed and worked under four, 1,000–hour contracts as an Engineer 4. His last contract with ODNR ended in June 2010.

{¶ 3} In 2009, MRM division officials began to discuss creating a full-time Natural Resources Engineer 3 position to perform the work Warden was performing under his intermittent assignments. Husted and Susan Grant, Warden's immediate supervisor, asked Warden if he would be interested in the position. Warden informed Grant that he was.

{¶ 4} In early 2010, ODNR posted the full-time Engineer 3 position, and Warden applied for it. He received the highest overall score of the interviewed applicants. After the interview, Husted told Warden it was not likely ODNR would select Warden because he was a retiree. Grant and Lanny Erdos, a deputy chief at ODNR, told Warden he would not be selected because the administration would not allow an individual who retired from the agency to be rehired into another full-time position. Ultimately, ODNR hired Jared Knerr, age 39, for the position. At the time, Warden was age 54.

{¶ 5} In January 2011, Warden filed a complaint in the Court of Claims of Ohio alleging a claim of age discrimination under R.C. 4112.14 and 4112.99 against ODNR. The matter proceeded to a bench trial on the issue of liability.

{¶ 6} ODNR claimed it did not hire Warden for the Engineer 3 position because of a policy that generally prohibited rehiring retired former employees in the same or similar position to that which they retired from and that age was not a factor in the decision. Former ODNR Director Sean Logan testified he instituted the policy to prevent the practice pejoratively referred to as “double-dipping,” i.e., being paid retirement benefits plus a salary for performing the same or similar job from which the employee retired. Logan testified double-dipping creates a “distrust with the public,” and, in his opinion, to retire means to leave the position. (R. 113, Apr. 4, 2012 Decision at 5.) Additionally, Logan testified about an “exceptional circumstances” exception to the general policy on rehiring retirees. Under this exception, ODNR hired a 55–year–old retiree, Thomas Tugend, to a similar position from which he retired. Logan admitted he never issueda directive to memorialize the policy against rehiring retired former employees or a directive to distribute the policy to the division chiefs or human resources staff. However, ODNR Human Resources Director Steve Bates did draft a memorandum which states in part that “[t]he re-employment of State of Ohio/Public Employer Retirees will be strictly limited to intermittent positions that require specialized knowledge and/or experience.” (Decision at 5.)

{¶ 7} According to Logan, ODNR Assistant Director Richard Milleson advised him a retiree was going to be recommended for the Engineer 3 position. Logan told Milleson, “they probably need to look harder.” (Dec. 28, 2011 Tr. 182.) Logan admitted he did not discuss the specific position duties for the Engineer 3 position when presented with the possibility of hiring a retiree for the job. Logan did testify that fulfillment of the Engineer 3 position did not have the same level of urgency as the fulfillment of Tugend's position.

{¶ 8} Mamie Hollenback, a former ODNR human resources associate, testified that, after she set up Warden's interview, her supervisor told her ODNR could not rehire a retiree. Hollenback claimed she told Warden's interview panel, before they even met with Warden, they could not hire him based on his retiree status. However, the panel members claimed that before the interview, they were unaware of a policy prohibiting rehiring retirees to the same or similar position and were unaware of the Bates memorandum. The panel members testified they either did or would have recommended Warden for the Engineer 3 position; but, Erdos told one of the panel members the panel needed to consider the other applicants because ODNR could not rehire Warden. Erdos claimed Milleson advised him ODNR could not rehire a retired former employee. Erdos testified he never saw the Bates memorandum and was unaware of a policy prohibiting rehiring former retired employees. Husted also testified about his lack of knowledge of a policy on retirees or the memorandum. According to Husted, Milleson told him ODNR did not want to hire Warden because he was a retiree.

{¶ 9} The Court of Claims determined ODNR was not liable under the disparate treatment theory of age discrimination but was liable under the disparate impact theory. After a trial on the issue of damages, the Court of Claims entered a judgment in favor of Warden in the amount of $507,656.75.

II. ASSIGNMENTS OF ERROR

{¶ 10} ODNR appeals and presents this court with three assignments of error for our review:

[1.] Because Mr. Warden failed to prove his disparate-treatment claim, the trial court erred by denying ODNR's Rule 41(B)(2) motion to dismiss the case.

[2.] The trial court erred by finding ODNR liable on a disparate-impact claim that was never pled, litigated or proven.

[3.] The Court of Claims erred by awarding Mr. Warden damages to which he was plainly not entitled.

{¶ 11} Warden cross-appeals and presents this court with three cross-assignments of error for our review:

1. The lower court erred in its April 4, 2012 Decision and Judgment Entry by concluding there was no direct evidence of age discrimination when Appellant/Cross–Appellee, Ohio Department of Natural Resources (“ODNR”) relied on a policy and practice of prohibiting the rehire of retired employees over 40 years of age to reject Warden for the Natural Resources Engineer 3 positiin [sic].

2. The lower court erred in its April 4, 2012 Decision and Judgment Entry by concluding that Warden failed to establish pretext of age discrimination on his disparate treatment claim when their [sic] was evidence that ODNR's reasons not to hire him was [sic] a proxy for age discrimination.

3. The lower court erred in its January 15, 2013 Decision and Judgment Entry by limiting Warden's recovery of his tax liability against his back pay award, instead of against both his back pay and front pay awards.

{¶ 12} For ease of analysis, we will address the assignments of error and cross-assignments of error out of order.

III. DISCUSSIONA. Civ.R. 41(B)(2) Motion to Dismiss

{¶ 13} In its first assignment of error, ODNR contends the Court of Claims erred when it denied ODNR's motion to dismiss because Warden failed to prove disparate treatment age discrimination occurred.

{¶ 14} Civ.R. 41(B)(2) provides:

After the plaintiff, in an action tried by the court without a jury, has completed the presentation of the plaintiff's evidence, the defendant, without waiving the right to offer evidence in the event the motion is not granted, may move for a dismissal on the ground that upon the facts and the law the plaintiff has shown no right to relief. The court as trier of the facts may then determine them and render judgment against the plaintiff or may decline to render any judgment until the close of all the evidence.

(Emphasis added.)

{¶ 15} After Warden rested his case-in-chief in the liability phase of trial, ODNR moved for dismissal under Civ.R. 41(B)(2). ODNR argues it was entitled to dismissal at that time because Warden offered no evidence on what ODNR contends was the only issue before the Court of Claims—whether the policy against double-dipping was merely a pretext for disparate treatment age discrimination. After ODNR made the motion, the Court of Claims stated: “I'm uncomfortable at this point because I'm not sure that I totally agree with [ODNR], although I think you've got good points, but I'm going to hear your evidence.” (Dec. 28, 2011 Tr. 168.) Although the Court of Claims ultimately rejected Warden's disparate treatment claim, ODNR essentially claims the Court of Claims erred when it opted to hear ODNR's evidence rather than granting ODNR's motion immediately after Warden rested his case-in-chief.

{¶ 16} However, Civ.R. 41(B)(2) expressly authorized the trial court to “decline to render any judgment until the close of all the evidence.” Thus, the Court of Claims did not err when it declined to rule on ODNR's motion at the close of Warden's case-in-chief and proceeded to hear further evidence. Fairbanks Mobile Wash, Inc. v. Hubbell, 12th Dist. No. 2007–05–062, 2009-Ohio-558, 2009 WL 294936, ¶...