C. David Morrison
James M. Cagle
Rodney L. Bean Charleston, West Virginia
Steptoe & Johnson, PLLC Attorney for Appellee
Clarksburg, West Virginia
Herbert G. Underwood
Clarksburg, West Virginia
Attorneys for Appellant
The opinion of the Court was delivered PER CURIAM.
JUSTICES DAVIS and MAYNARD concur and reserve the right to file concurring
2. This Court reviews de novo the denial of a motion for summary judgment,
where such a ruling is properly reviewable by this Court. Syllabus point 1, Findley v. State
Farm Mut. Auto. Ins. Co., 213 W. Va. 80, 576 S.E.2d 807 (2002).
3. 'Where an employee seeks to establish a permanent employment contract or
other substantial employment right, either through an express promise by the employer or by
implication from the employer's personnel manual, policies, or custom and practice, such
claim must be established by clear and convincing evidence.' Syllabus point 3, Adkins v. Inco
Alloys International, Inc., 187 W. Va. 219, 417 S.E.2d 910 (1992). Syllabus point 3, Wilson
v. Long John Silver's, Inc., 188 W. Va. 254, 423 S.E.2d 863 (1992).
Eastern Associated Coal Corporation, appellant/defendant below (hereinafter Eastern), appeals entry of a final order of the Circuit Court of Boone County, West Virginia, awarding Forrest A. Younker, appellee/plaintiff below (hereinafter Mr. Younker) $378,549.00 in a breach of contract claim, after having granted Mr. Younker's partial summary judgment on liability, after having tried the damages aspect of the case and after having denied Eastern's motion for summary judgment. Having reviewed the briefs, the pertinent authorities, and hearing oral argument, we reverse the circuit court's award of partial summary judgment to Mr. Younker. We also find that Eastern is entitled to summary judgment on the breach of contract claim and thus reverse the circuit court's failure to award summary judgment to Eastern.
On November 16, 1992, Mr. Younker was visited at his home by a federal Internal
Revenue Service agent and a West Virginia State Police Trooper, working for the federal
government. These agents interviewed him concerning any knowledge he had of coalfield
corruption, the subject of a federal probe. During this interview, Mr. Younker admitted to
having had a sexual encounter with Donna Adkins (hereinafter Ms. Adkins). Mr. Younker
denied that he knew that Ms. Adkins had been paid to have sex with him by Abbs Valley, a
vendor doing business with Eastern.
On the morning of November 19, 1992, Mr. Younker spoke with Eastern's in-house
counsel, Thomas Gallagher (hereinafter Mr. Gallagher), about the November 16 interview.
Mr. Younker told Mr. Gallagher, You know, Tom, I'm not much of a churchgoer. And we
all do things in our lives which sometimes we're ashamed of and regret doing. Mr. Younker
then asked if what he told Mr. Gallagher would be confidential. Mr. Gallagher told him no
as Mr. Gallagher represented Eastern. Mr. Gallagher then directed Mr. Younker to Eastern
President Peter B. Lilly (hereinafter Mr. Lilly). During the November 19 morning meeting
with Mr. Lilly, Mr. Younker told Mr. Lilly of the November 16 interview. Mr. Younker also
said that he had a problem because he liked to 'chase skirt' and that he may have had a
small skeleton in his closet. Mr. Younker then admitted to a sexual encounter with Ms.
(See footnote 2) as well as admitting
he saw her several times thereafter, albeit in a platonic way.
(See footnote 3) Mr. Younker also
informed Mr. Lilly that the agents had alleged that Abbs Valley had paid Ms.
Adkins to have sex with Mr. Younker. Mr. Younker then returned to his duties.
That afternoon, Mr. Younker was summoned to Mr. Gallagher's office where Mr.
Lilly gave Mr. Younker a resignation memorandum and told him that . . . I want you to
resign. When asked why, Mr. Lilly responded, 'No comment.' Mr. Younker then asked,
'If I don't sign this, then are you going to fire me, discharge me?' Mr. Lilly replied, 'No
comment,' which Mr. Younker took to be an affirmative response. Mr. Younker then
signed the document.
In 1994, Mr. Younker sued alleging that he was forced to resign either because of his
age or because he cooperated with federal authorities on November 16, 1992. In 1996, over
three and one half years after being terminated and over two years after filing his original
complaint, Mr. Younker requested and received permission from the circuit court to amend
his complaint to add a claim that his discharge constituted a breach of contract under
Eastern's Code of Business Conduct (hereinafter the CBC).
(See footnote 4)
On December 6, 1996, Mr. Younker moved for a partial summary judgment on the breach of contract claim which Eastern opposed. On March 7, 1997, Eastern filed its own motion for summary judgment on all of Mr. Younker's claims then before the circuit court.
On March 21, 1997, Mr. Younker filed a motion to hold his age discrimination and retaliatory discharge claims in abeyance pending a trial on the damages relating to his breach of contract claim. (See footnote 5) In this motion, Mr. Younker agreed to dismiss the remaining two counts of his amended complaint if this Court affirmed any ruling in his favor. Eastern objected.
On July 31, 1997, the circuit court entered partial summary judgment on behalf of Mr.
Younker under the breach of contract claim. On that same day, Eastern withdrew its
objection to staying the remaining counts pursuant to Mr. Younker's motion.
(See footnote 6) The circuit court
then held a bench trial on damages.
After a number of procedural orders, the circuit court entered an order on November
19, 1999. The circuit court awarded Mr. Younker $378,649.00. The order also granted Mr.
Younker's motion to conform the pleading to the evidence under W. Va. R. Civ. P. 15(b) by
entering judgment against Eastern on the basis that the evidence at the damages trial showed
that Mr. Younker's forced resignation violated W. Va. Code § 22A-1-22 (1994) (Repl. Vol.
2002) which prohibits discrimination against a miner who, among other things, reveals to
enumerated persons any alleged violation or danger.
On August 21, 2002, the circuit court entered a final order resolving the last of the
outstanding motions and providing this matter is concluded and striking it from the docket.
From these rulings, Eastern filed this current appeal.
the instant appeal is before this Court as a result of the circuit court's grant of [partial] summary judgment to [Mr. Younker as well as its award of damages] and its denial of summary relief to [Eastern Associated]. Typically, we apply a plenary review to a circuit court's entry of summary judgment. A circuit court's entry of summary judgment is reviewed de novo. Syl. pt. 1, Painter v. Peavy, 192 W. Va. 189, 451 S.E.2d 755 (1994). Similarly, when review of a circuit court's denial of summary judgment is properly before this Court, we examine anew the circuit court's ruling. This Court reviews de novo the denial of a motion for summary judgment, where such a ruling is properly reviewable by this Court. Syl. pt. 1, Findley v. State Farm Mut. Auto. Ins. Co., 213 W. Va. 80, 576 S.E.2d 807 (2002).
Tackett v. American Motorists Ins. Co., 213 W. Va. 524, ___, 584 S.E.2d 158, 161 (2003) (footnote omitted). In other words, [i]n considering the propriety of summary judgment in this case, we apply the same standard that is applied at the circuit court level[.] Watson v. Inco Alloys Intern., Inc., 209 W. Va. 234, 238, 545 S.E.2d 294, 298 (2001). [I]n making a ruling, 'the judge must view the evidence presented through the prism of the substantive evidentiary burden.' Williams v. Precision Coil, Inc., 194 W. Va. 52, 62, 459 S.E.2d 329, 339 (1995) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254, 106 S. Ct. 2505, 2513, 91 L. Ed.2d 202, 215 (1986)). In cases of substantial doubt, the safer course of action is to deny the motion and to proceed to trial. Id. at 59, 459 S.E.2d at 336.
[Eastern's] business and reputation depends, in large measure, on strict adherence to the provisions of this Code. All employees are encouraged and obligated to report any known or suspected Code violations to the employee's supervisor and the appropriate Counsel. No disciplinary or other retaliatory action will be taken against an employee making such a report and all information provided will be maintained in the strictest confidence.
Based on this provision, Mr. Younker argues that he reported wrongdoing on November 19, 2002. As a consequence of his reporting he was fired. He thus contends that his termination violated the contract the CBC created. Eastern counters, inter alia, that the CBC is not a contract as it lacks sufficiently definite terms to be read as a contract pointing out that article XIV is entitled Nonexclusivity and provides:
This Code does not constitute a comprehensive, full or complete explanation of the laws which are applicable to the Company and its employees nor does it contain all applicable policies and basis for discipline or discharge. Each employee has a continuing obligation to be familiar with applicable law and all [Eastern] policies and procedures.
Eastern also points out that other courts have found that language similar to article XII does not constitute a contract. We agree with Eastern.
This Court has traditionally recognized that an employment which is of an indefinite
duration is rebuttably presumed to be a hiring at will, which is terminable at any time at the
pleasure of either the employer or the employee. Williamson v. Sharvest Mgt. Co., 187 W.
Va. 30, 32-33, 415 S.E.2d 271, 273-74 (1992). Notwithstanding the at-will presumption, we
have also recognized that contractual provisions relating to discharge or job security may
alter the at will status of a particular employee. Bailey v. Sewell Coal Company, 190 W. Va.
138, 141, 437 S.E.2d 448, 451 (1993). Thus, representations contained in an employee
handbook or policy manual and intended to be used by employers can meet the normal
requirements for formation of an implied contract. Id., 437 S.E.2d at 451.
However, because of the at-will presumption, any promises alleged to alter the presumptive relationship must be very definite to be enforceable. Id., 437 S.E.2d at 451 (citing Suter v. Harsco Corp., 184 W. Va. 734, 737, 403 S.E.2d 751, 754 (1991)). The party asserting that an employment was other than at-will bears the burden of rebutting the at-will presumption. Id., 437 S.E.2d at 451 (citing Suter, 184 W. Va. at 737, 403 S.E.2d at 754). The burden a plaintiff undertakes in this regard is heavy, as:
[w]here an employee seeks to establish a permanent employment contract or other substantial employment right, either through an express promise by the employer or by implication from the employer's personnel manual, policies, or custom and practice, such claim must be established by clear and convincing evidence. Syllabus point 3, Adkins v. Inco Alloys International, Inc., 187 W. Va. 219, 417 S.E.2d 910 (1992).
Syl. pt. 3, Wilson v. Long John Silver's, Inc., 188 W. Va. 254, 423 S.E.2d 863 (1992).
We have recognized that [a]n employee handbook may form the basis of a unilateral
contract if there is a definite promise therein by the employer not to discharge covered
employees except for specified reasons. Syl. pt. 6, Cook v. Heck's, Inc., 176 W. Va. 368,
342 S.E.2d 453 (1986). In Cook the handbook specifically provided a complete list of rules
and disciplinary procedures[.] Id. at 370, 342 S.E.2d at 455. In finding that the handbookconstituted a contract, we reasoned, [t]he inclusion in the handbook of specified discipline
for violations of particular rules accompanied by a statement that the disciplinary rules
constitute a complete list is prima facie evidence of an offer for a unilateral contract of
employment modifying the right of the employer to discharge without cause. Id. at 374, 342
S.E.2d at 459. We then specifically noted that '[n]o unilateral contract arises merely by the
fact that [the employer] has alerted its employees that certain conduct may form the basis of
a discharge.' Id., 342 S.E.2d at 459 (citation omitted). We elaborated on this last point in
Wilson v. Long John Silver's, Inc., 188 W. Va. 254, 423 S.E.2d 863 (1992).
In Wilson, a discharged employee claimed that the company's policies and procedures manual constituted a unilateral contract entitling him to progressive discipline rather than immediate termination. Id. at 255, 423 S.E.2d at 864. The employer appealed the denial of its motions for summary judgment, directed verdict and judgment notwithstanding the verdict. Id., 423 S.E.2d at 864. In finding Cook was not satisfied we said:
Our review of the manual reveals that it did not include any statement proclaiming that the manual was not a contract of employment. However, as Long John Silver's points out, the statements of
Circumstances Warranting Discharge and Progressive Discipline situations did not constitute complete lists since the sections stated [s]uch infractions include, but are not limited to: . . . and [s]uch circumstances include, but are not limited to: . . ., respectively. We cannot find any clear and convincing evidence that the manual contained a promise, let alone a definite promise, sufficient to modify the employment at will relationship.
Wilson, 188 W. Va. at 257, 423 S.E.2d at 866. We believe that Wilson disposes of Mr. Younker's claims.
Like the policy manual in Wilson, Eastern's CBC does not contain a statement proclaiming that it was not an employment contract. However, also like the manual in Wilson, the CBC disciplinary provisions are not exclusive. Indeed, article XIV is specifically entitled Nonexclusivity and provides:
This Code does not constitute a comprehensive, full or complete explanation of the laws which are applicable to the Company and its employees nor does it contain all applicable policies and basis for discipline or discharge. Each employee has a continuing obligation to be familiar with applicable law and all Peabody policies and procedures.
Thus, we find that the CBC does not reach that very definite level of specificity required to create a contract. In so finding, we join a number of other courts that have reviewed CBCs similar to Eastern's and found that they embodied only aspirational goals rather than contractual terms. See, e.g., Hinchey v. Nynex Corp. , 144 F.3d 134, 141-42 (1st Cir. 1998); Marsh v. Delta Air Lines, Inc., 952 F. Supp. 1458, 1466 (D. Colo. 1997); Allen v. Ethicon, Inc., 919 F. Supp. 1093, 1100 (S.D. Ohio. 1996); Tripodi v. Johnson & Johnson, 877 F. Supp. 233, 237 (D.N.J. 1995). Cf. Maximus, Inc. v. Thompson, 78 F. Supp.2d 1182, 1190 n.4 (D. Kan. 1999) (employees could not be held liable for breach of contract for not disclosing potential conflicts as required by company's standards of business conduct and ethics). (See footnote 8) Consequently, we find that the circuit court erred in failing to grant Eastern summary judgment on the breach of contract claim and therefore reverse the circuit court. (See footnote 9)