Barry v. Posi-Seal International, Inc.

Foti, J.,

dissenting. I cannot agree that either an implied or an express contract of employment existed between the parties. The evidence established, at most, an employment for no fixed duration, terminable at will.

The plaintiff alleged in the first count of his complaint the existence of an express and implied in fact employment agreement that comprised a total employment agreement. The defendant denied these allegations. In support of his claim, the plaintiff presented evidence of an oral statement made by Eugene Bisbee, vice president of the defendant, and general manager of the plant where the plaintiff worked. The plaintiff claims that Bisbee told the plaintiff that “if you do your job . . . you’re going to have a job here.”1

The plaintiff also testified that, although he could not recollect when, he had received a copy of the defendant’s personnel manual containing all revisions through December 31,1982, which is five years after he became an employee of the defendant in 1977. The manual expressly stated that it was intended to be simply a guide and a reference.

“It is true that under appropriate circumstances statements in an employee handbook or manual may give rise to an implied contract between an employer *23and its employee. . . . The mere fact [however,] that the plaintiff believed the guidelines to constitute a contract does not bind [the defendant] without some evidence that it intended to be bound to such a contract.” Christensen v. Bic Corp., 18 Conn. App. 451, 457-58, 558 A.2d 273 (1989). “It is the plaintiffs burden to prove, by a preponderance of the evidence, that the [defendant] had agreed by either words or deeds to recognize and undertake a contractual commitment . . . .” Id., 454. There was no evidence presented that the plaintiff ever relied on the manual. He consulted it only once for the purpose of determining whether the defendant had a policy dealing with bereavement.

I agree that whether an implied contract of employment existed by virtue of the employer’s policies and oral representations is a question of fact for the jury. Statements in an employer’s personnel manual may form the basis of a contract between employer and employee. Finley v. Aetna Life & Casualty Co., 202 Conn. 190, 197-99, 520 A.2d 208 (1987), overruled on other grounds in Curry v. Burns, 225 Conn. 782, 626 A.2d 719 (1993). Such a finding, however, may be made only where the traditional contract requirements are met. Sivell v. Conwed Corp., 666 F. Sup. 23, 27 (D. Conn. 1987). Showing that employment was either accepted or continued in reliance on the representation in the manual is such a traditional contract element. See Coelho v. Posi-Seal International, Inc., 208 Conn. 106, 118, 544 A.2d 170 (1988).2 While there is *24no requirement that the personnel manual mention any separate consideration; Finley v. Aetna Life & Casualty Co., supra, 199; “[demonstrating that employment was accepted [or continued] in reliance on the representations in the manual is a threshold requirement. [Sivell v. Conwed Corp., supra, 666 F. Sup. 27; Coelho v. PosiSeal International, Inc., supra, 208 Conn. 118].” Cartier v. United States Shoe Corp., United States District Court, District of Connecticut, Docket No. 91CV-00595 (June 24, 1992) (Dorsey, J.). It is axiomatic that reliance requires more than a mere awareness; there must be a conscious dependence on a contractual term — in this case, the representations contained in the manual.

There was absolutely no evidence of the plaintiffs reliance on the defendant’s personnel manual. He had never read it except to see about time off for a death in the family. He did not forgo other job opportunities because of the representations in the manual, nor was he even aware of any “promises” it contained that caused him either to accept or continue his employment.3 There was no evidence sufficient to constitute *25a separate consideration for the agreement alleged by the plaintiff, that is, that he relied on the terms of the personnel manual.4

Further, there appears to be no evidence that the plaintiff commenced his employment other than as an at-will employee. The plaintiff claims that Bisbee’s statement and the personnel manual established job security to such a level that they created an employment contract. I cannot agree, in the circumstances of this case, that contractual liability arose in the form of an employment contract.

There was no evidence on which the jury reasonably could have found an implied employment contract. No evidence was proffered that would take the employment agreement out of the general rule that “contracts of permanent employment, or for an indefinite term are terminable at will.” D’Ulisse-Cupo v. Board of Directors of Notre Dame High School, 202 Conn. 206, 211 n.1, 520 A.2d 217 (1987); see Magnan v. Anaconda Industries, Inc., 193 Conn. 558, 479 A.2d 781 (1984). I conclude that it was plain error to submit this issue to the jury when, as a matter of law, the evidence was insufficient to support the plaintiffs claim.5

The plaintiffs second count alleges a breach of the implied covenant of good faith and fair dealing incidental to the contract. In order to prevail on this claim, the plaintiff, as an at-will employee, must prove that he was terminated for an improper reason and that the *26impropriety of the reason derives from a violation of an important public policy. Magnan v. Anaconda Industries, Inc., supra, 193 Conn. 572. “In the absence of a public policy violation, there is no breach of the implied covenant of good faith and fair dealing.” Doherty v. Sullivan, 29 Conn. App. 736, 743, 618 A.2d 56 (1992). The plaintiff has neither claimed nor identified a violation of such a public policy contravened by the defendant, but rather argued that he was not an at-will employee. He cannot prevail on this claim.

Since the contract is one of employment at-will, there can be no recovery for prospective damages, referred to by the parties as front pay or future lost wages and benefits,6 simply because there could be no expectation for future earnings in such a matter. At most, an at-will employee is entitled to wages only through the date of discharge.

The majority has presented a scholarly analysis of front pay and concluded that no such damages should be allowed in contract actions. I cannot agree to that broad conclusion.7 While such damages may be disal*27lowed in the present case since the plaintiff became fully employed elsewhere, the generalization that under no circumstances may such prospective damages be allowed in a breach of employment contract is unfounded. If, as the majority concludes, a contract of employment rather than an at-will employment existed, then I would disagree that such damages are not allowable general contract damages.

“ ‘As a general rule, contract damages are awarded to place the injured party in the same position as he would have been in had the contract been fully performed.’ ” Fuessenich v. DiNardo, 195 Conn. 144, 153, 487 A.2d 514 (1985). General contract damages are allowable whenever they arise directly from and as a natural consequence of the breach. Kay Petroleum Corp. v. Piergrossi, 137 Conn. 620, 624, 79 A.2d 829 (1951). “Prospective damages are recoverable if they are reasonably certain to occur. Craney v. Donovan, 92 Conn. 236, 245, 102 A. 640 (1917).” Neiditz v. Morton S. Fine & Associates, Inc., 2 Conn. App. 322, 328, 479 A.2d 249 (1984), rev’d in part, 199 Conn. 683, 508 A.2d 438 (1986).8

*28Our Supreme Court has stated that “[t]he normal rule on an employment contract is that when the employee is prevented from fully performing because the employer wrongfully fires him, the employee can recover the wages he would have earned under the contract, minus any wages which he has earned or could have earned elsewhere, and the burden of proof of the latter is on the employer. Carter v. Bartek, 142 Conn. 448, 451-52, 114 A.2d 923 [1955].” (Emphasis added.) Burns v. Gould, 172 Conn. 210, 221, 374 A.2d 193 (1977). Wages one would have earned under the contract are the equivalent of future wage loss, often called front pay. “ ‘The injured party is not precluded from recovery . . . to the extent that he has made reasonable but unsuccessful efforts to avoid loss.’ ” West Haven Sound Development Corp. v. West Haven, 201 Conn. 305, 332, 514 A.2d 734 (1986). The plaintiff here has, by obtaining employment elsewhere, either avoided or mitigated the loss. Normally, the determination of the extent of mitigation, if any, as it applies to future wage loss, is made by the finder of fact. No such determination is necessary in the present case as I have concluded that the evidence was insufficient to establish that the plaintiff was anything other than an at-will employee.

Because the plaintiff did not demonstrate the existence of a total employment contract, his remaining claims must also fail. The defendant had no duty to comply with the terms of the personnel manual in regards to the plaintiff’s at-will employment.

I would, therefore, reverse the judgment and remand the case with direction to set aside the verdict and to render judgment in favor of the defendant.

The plaintiff concedes that this statement alone cannot support a contract, but rather only lends support for the provisions in the personnel manual that allegedly created an implied employment contract.

I believe the majority misreads Coelho when it concludes that no reliance is required. In Coelho, our Supreme Court examined the issue of whether an implied agreement not to discharge without just cause is unenforceable unless supported by some separate consideration. Our Supreme Court held that: “[W]e adopt the position . . . that the absence of a separate consideration does not inevitably invalidate a contract otherwise expressing an intention that employment not be terminable at will. . . . Accordingly, we need not decide whether the evidence advanced by the plaintiff of reliance on the promises of the defendant was sufficient to con*24stitute a separate consideration for the agreement not to discharge him simply because of some dispute .... This evidence [that the plaintiff had relocated and forgone other job opportunities] fulfilled its function in supporting the plaintiffs version of the terms of the agreement, whether or not it would satisfy the criteria for separate consideration.” (Emphasis added.) Coelho v. Posi-Seal International, Inc., supra, 208 Conn. 118-19.

In reaching that conclusion, our Supreme Court had already determined that there was sufficient evidence of consideration to find an implied contract of employment between the plaintiff and the defendant. The court merely held that any additional evidence of the specific terms of promises need not rise to the level of separate consideration in order to enforce those promises.

In the present case, I am persuaded that there was insufficient evidence to find an implied contract of employment.

The plaintiff points to his affidavit submitted in objection to the defendant’s motion for summary judgment as evidence of his reliance. I note that the affidavit was introduced at trial by the defendant only for the purpose of impeaching the plaintiff, not for substantive purposes. The affidavit could not be relied on by the jury for substantive purposes. See Kelley v. Bonney, 221 Conn. 549, 564-65, 606 A.2d 693 (1992).

The plaintiff also testified at trial that in his deposition he had indicated that he received the personnel manual only after he had begun his employment with the defendant and that he never read it, but just threw it in his tool box.

Because I have concluded that no reliance has been demonstrated, I find it unnecessary to determine whether the plaintiff sustained his burden of establishing any enforceable contractual language in the manual. See Carbone v. Atlantic Richfield Co., 204 Conn. 460, 472, 528 A.2d 1137 (1987).

See Preston v. Phelps Dodge Copper Products Co., 35 Conn. App. 850, 647 A.2d 364 (1994).

The majority seems to rely on semantics in attempting to distinguish “future wage loss,” wages that would have been earned under an existing contract of employment, from front pay, a remedy designed to compensate employees where reinstatement would be impractical or inadequate. I cannot reconcile this attempt to distinguish the two terms with the majority’s own interchanging of the terms. The majority refers to “future lost earnings, commonly known as ‘front pay.’ ”

I agree that the term “front pay” is reserved to describe that remedy available under the Age Discrimination in Employment Act and other federal statutes. Absent this distinction, not applicable under the facts of this case, I see no practical difference between the remedies afforded under the two different nomenclature. “Front pay” must refer to prospective wages. Accordingly, because it refers to wages after termination, it can be awarded only under a contract of employment as discussed.

In addition, I note that while the majority discusses front pay, the jury was instructed on and the special interrogatories referred to future wage loss. After instructing the jurors that they were not permitted to award *27speculative damages, the court instructed: “In assessing damages for future losses, you must determine what amount, if any, the plaintiff has proved by the preponderance of the evidence he would receive if he continued in the employment of the defendant for the period in the future you determine he would remain in such employment, less any sums the defendant has proved to you by the preponderance of the evidence that the plaintiff will in reasonable probability be able to receive by the exercise of reasonable diligence during such future period.” I point this out not because I find any practical distinction between these terms, but because I believe the majority does so improperly under the circumstances of this case.

The majority itself cites Jacobs v. Thomas, 26 Conn. App. 305, 314, 600 A.2d 1378 (1991), cert. denied, 221 Conn. 914, 603 A.2d 404 (1992), for the proposition that in contract actions, both past and prospective damages may be recovered. In light of this, I do not understand how the majority reaches the conclusion that the award of front pay, or in this case, future wage loss, “would violate principles of contract damages and would defy common sense.” It would seem a greater violation of common sense to deprive a plaintiff of an available remedy based simply on the nomenclature employed occasionally by the parties.