No. 80-281
IN THE SUPREME COURT OF THE STATE OF MONTANA
1981
LEO K. REITER,
Plaintiff and Appellant,
-vs-
YELLOWSTONE COUNTY, MONTANA, et al.,
Defendants and Respondents.
Appeal from: District Court of the Thirteenth Judicial District,
In and for the County of Yellowstone, The Honorable
Robert H. Wilson, Judge presiding.
Counsel of Record:
For Appellant :
Boschert & Boschert, Billings, Montana
For Respondents:
McNamer, Thompson & Cashmore, Billings, Montana
Submitted on Briefs: December 17, 1980
Decided: b ~ r ~ y4 198%
-,
Filed:
, ,
-- 1281
M r . C h i e f J u s t i c e F r a n k I . H a s w e l l d e l i v e r e d t h e O p i n i o n of t h e
Court.
Leo Reiter i n i t i a t e d t h i s a c t i o n i n t h e D i s t r i c t Court
s e e k i n g r e i n s t a t e m e n t and b a c k pay a s a r e s u l t of r e s p o n d e n t s 1
f a i l u r e to hold a h e a r i n g p r i o r to t h e t e r m i n a t i o n of h i s
employment. R e s p o n d e n t s 1 m o t i o n f o r summary j u d g m e n t was g r a n t e d
o n t h e g r o u n d t h a t R e i t e r was n o t e n t i t l e d to a p r e t e r m i n a t i o n
h e a r i n g a s a matter o f law. From t h i s summary j u d g m e n t , Reiter
appeals.
A t t h e time o f h i s d i s c h a r g e o n S e p t e m b e r 2 2 , 1978, Reiter
h a d b e e n employed f o r n e a r l y 1 8 y e a r s as a c u s t o d i a n a t t h e
Y e l l o w s t o n e County C o u r t h o u s e , and had a t t a i n e d t h e p o s i t i o n of
night supervisor. Following a disagreement w i t h c u s t o d i a n Harry
E v a n s o v e r work t o be p e r f o r m e d , R e i t e r t e r m i n a t e d E v a n s '
employment. S h o r t l y t h e r e a f t e r , R e i t e r was i n f o r m e d by h i s
s u p e r v i s o r , P a u l K i n g , t h a t h i s own employment was t e r m i n a t e d .
A t an informal meeting w i t h t h e county commissioners on
S e p t e m b e r 1 8 , 1 9 7 8 , R e i t e r was i n f o r m e d he would be s u s p e n d e d
u n t i l a h e a r i n g was h e l d t o d e t e r m i n e t h e f a c t s . In response t o
R e i t e r ' s a t t e m p t s t o d i s c u s s t h e s i t u a t i o n , t h e c o u n t y com-
m i s s i o n e r s r e p e a t e d l y p r o m i s e d t h a t a h e a r i n g would be h e l d .
S u b s e q u e n t l y , R e i t e r r e c e i v e d a w r i t t e n l i s t of r e a s o n s
f o r h i s d i s c h a r g e , i n c l u d i n g t h e u n a u t h o r i z e d f i r i n g of Evans,
l e a v i n g t h e b u i l d i n g d u r i n g w o r k i n g h o u r s , and l e t t i n g t h e men
off early. A p p e l l a n t c o n t e s t s t h e v a l i d i t y of t h e r e a s o n s . The
commissioners o f f e r e d to r e i n s t a t e Reiter a s a c u s t o d i a n b u t n o t
a s a supervisor. Reiter refused t h e o f f e r , a p p a r e n t l y because t h e
p r o p o s e d c o n t r a c t was demeaning i n t o n e . No h e a r i n g was h e l d ,
and R e i t e r l s d i s c h a r g e became f i n a l . Evans r e p l a c e d R e i t e r a s
night supervisor. I n v i e w o f t h e remedy r e q u e s t e d , it is e s s e n -
t i a l t o n o t e t h a t t h e p o s i t i o n of n i g h t s u p e r v i s o r was sub-
sequently abolished.
R e i t e r l s employment was n o t c o v e r e d by a n y w r i t t e n
c o n t r a c t or c o l l e c t i v e b a r g a i n i n g agreement or o r d i n a n c e . Based
o n t h e l o n g e v i t y o f h i s s e r v i c e and t h e f a c t t h a t h e was a p e r -
m a n e n t e m p l o y e e , R e i t e r claims t h a t he had a p r o p e r t y i n t e r e s t i n
h i s c o n t i n u e d employment and t h a t t h e r e f o r e , h e was e n t i t l e d t o
p r o c e d u r a l due p r o c e s s p r i o r to h i s d i s m i s s a l .
I n granting respondents' m o t i o n f o r summary j u d g m e n t , the
D i s t r i c t C o u r t f o u n d t h a t s e c t i o n 39-2-503, MCA, providing t h a t
a n employment w i t h no s p e c i f i e d term may be t e r m i n a t e d a t t h e
w i l l o f e i t h e r p a r t y w a s c o n t r o l l i n g and t h a t R e i t e r had no
c o n s t i t u t i o n a l r i g h t to a h e a r i n g .
W e f i n d t h e i s s u e s r a i s e d by t h i s a p p e a l are:
1) Was t h e a p p e l l a n t d e n i e d h i s d u e p r o c e s s r i g h t s when h e
was d i s c h a r g e d w i t h o u t a p r i o r h e a r i n g t o d e t e r m i n e i f t h e r e w a s
j u s t cause f o r the termination?
2 ) Was t h e a p p e l l a n t e n t i t l e d to a p r e t e r m i n a t i o n h e a r i n g
b y v i r t u e o f t h e p r o m i s e made by t h e c o m m i s s i o n e r s t h a t he would
be given a hearing?
I. DUE PROCESS
A p p e l l a n t a r g u e s t h a t he w a s e n t i t l e d to p r o c e d u r a l d u e
process p r i o r t o h i s termination. H e relies p r i m a r i l y on t h e
f o l l o w i n g l a n g u a g e f r o m P e r r y v . S i n d e r m a n n ( 1 9 7 2 ) , 4 0 8 U.S. 593,
6 0 2 , 92 S . C t . 2694, 2700, 3 3 L.Ed.2d 570:
"A t e a c h e r , l i k e t h e r e s p o n d e n t , who h a s h e l d
h i s p o s i t i o n f o r a number o f y e a r s , m i g h t b e
a b l e t o show f r o m t h e c i r c u m s t a n c e s o f t h i s
s e r v i c e - - a n d f r o m o t h e r r e l e v a n t f a c t s - - t h a t he
h a s a l e g i t i m a t e claim o f e n t i t l e m e n t t o j o b
tenure."
AS l l c i r c u m s t a n c e s l l and " o t h e r r e l e v a n t f a c t s " he p o i n t s t o h i s
l o n g e v i t y of s e r v i c e , h i s s u p e r v i s o r y p o s i t i o n , h i s r e t i r e m e n t
a n d i n s u r a n c e b e n e f i t s , and t h e f a c t t h a t he w a s p r o m i s e d a
hearing. H e a s s e r t s t h a t t h e s e f a c t o r s g a v e him a " l e g i t i m a t e
claim o f e n t i t l e m e n t t o c o n t i n u e d employment" w h i c h is e n t i t l e d
t o d u e p r o c e s s p r o t e c t i o n a c c o r d i n g to P e r r y and Board o f R e g e n t s
v . Roth ( 1 9 7 2 ) , 408 U.S. 564, 92 S . C t . 2701, 3 3 L.Ed.2d 548.
A p p e l l a n t a l s o a r g u e s h e p o s s e s s e d a p r o p e r t y r i g h t by v i r t u e o f
a n i m p l i e d c o v e n a n t o f good f a i t h .
I n o r d e r to d e t e r m i n e whether due p r o c e s s r e q u i r e m e n t s
h a v e b e e n v i o l a t e d i n t h i s case, it m u s t be d e c i d e d w h e t h e r
a p p e l l a n t had e i t h e r a " l i b e r t y w or a " p r o p e r t y " i n t e r e s t which
f a l l s w i t h i n t h e p r o t e c t i o n o f t h e F o u r t e e n t h Amendment t o t h e
U n i t e d S t a t e s C o n s t i t u t i o n and A r t i c l e 11, S e c t i o n 1 7 , o f t h e
Montana C o n s t i t u t i o n . Board o f R e g e n t s v. R o t h , s u p r a ; Schend
v . T h o r s o n ( 1 9 7 6 ) , 1 7 0 Mont. 5 , 549 P.2d 8 0 9 . I f a p p e l l a n t can
cross t h i s t h r e s h o l d , t h e a n a l y s i s p r o c e e d s t o t h e s e c o n d
q u e s t i o n , i.e., w h a t s p e c i f i c p r o c e d u r e s a r e d u e i n t h i s case.
I n t h e l e a d i n g case o f R o t h , a n o n t e n u r e d t e a c h e r c l a i m e d
t h a t a v i o l a t i o n o f h i s d u e p r o c e s s r i g h t s o c c u r r e d when he w a s
d e n i e d a n o p p o r t u n i t y t o be h e a r d i n r e g a r d t o h i s d i s m i s s a l a t
t h e end o f h i s i n i t i a l o n e - y e a r c o n t r a c t w i t h t h e u n i v e r s i t y . A
s t a t u t e p r o v i d e d f o r t h e a c q u i s i t i o n of t e n u r e a f t e r f o u r y e a r s
o f year-to-year employment. After acquiring tenure the teacher
would be e n t i t l e d b y s t a t u t e to c o n t i n u e d employment d u r i n g good
b e h a v i o r and s a t i s f a c t o r y p e r f o r m a n c e , w i t h d i s c h a r g e a l l o w e d
o n l y f o r cause. The C o u r t f o u n d t h a t Roth had shown n o " l i b e r t y "
i n t e r e s t e n t i t l e d t o p r o t e c t i o n , s i n c e no s t i g m a had b e e n imposed
o n h i s "good name, r e p u t a t i o n , h o n o r o r i n t e g r i t y . " Nor d i d R o t h
have a "property" i n t e r e s t , for:
" [ t l o have a p r o p e r t y i n t e r e s t i n a b e n e f i t , a
p e r s o n c l e a r l y m u s t h a v e more t h a n a n a b s t r a c t
n e e d o r d e s i r e f o r i t . H e m u s t h a v e more t h a n a
u n i l a t e r a l e x p e c t a t i o n of i t . H e m u s t , i n s t e a d ,
h a v e a l e g i t i m a t e claim o f e n t i t l e m e n t t o it."
Board o f R e g e n t s v. R o t h , 408 U.S. 564, 577, 92
S . C t . 2701, 2709, 3 3 L.Ed.2d 548.
The e m p l o y e e m u s t be a b l e t o p o i n t t o an i n d e p e n d e n t s o u r c e s u c h
a s s t a t e l a w o r r u l e s o r u n d e r s t a n d i n g s b e t w e e n t h e e m p l o y e r and
h i s employees. The t e r m s o f R o t h ' s a p p o i n t m e n t were c o n t a i n e d i n
t h e s t a t u t e and i n h i s c o n t r a c t , i n which t h e r e was no s u p p o r t
f o r h i s claim o f e n t i t l e m e n t t o c o n t i n u e d employment.
The e v i d e n c e i n t h e i n s t a n t c a s e , e v e n when viewed i n t h e
l i g h t most f a v o r a b l e t o a p p e l l a n t , d o e s n o t show a t r a d i t i o n o r
an u n w r i t t e n p o l i c y concerning job s e c u r i t y f o r county employees.
The e v i d e n c e shows t h a t R e i t e r went t o t h e c o u n t y c o m m i s s i o n e r s
a f t e r h i s s u p e r v i s o r d i s m i s s e d him, and t h a t i n i t i a l l y t h e com-
m i s s i o n e r s p r o m i s e d him a h e a r i n g b u t l a t e r d e c i d e d he was n o t
e n t i t l e d to a h e a r i n g . The c o m m i s s i o n e r s , h a v i n g f i n a l a u t h o r i t y
i n c o u n t y p e r s o n n e l matters, t h e n a p p r o v e d o f R e i t e r ' s d i s c h a r g e .
A l t h o u g h R e i t e r may h a v e b e e n t r e a t e d u n f a i r l y , he s e e k s t o
s t r e t c h t h e d u e p r o c e s s c l a u s e beyond i t s l i m i t s by a s s e r t i n g t h e
e x i s t e n c e o f a p r o t e c t e d p r o p e r t y i n t e r e s t b a s e d upon l o n g e v i t y
o f s e r v i c e , i n v i e w o f s e c t i o n 39-2-503, MCA. That s t a t u t e
provides :
"An employment h a v i n g no s p e c i f i e d term may be
t e r m i n a t e d a t t h e w i l l of e i t h e r p a r t y on n o t i c e
to the other .. .I1
The U n i t e d S t a t e s Supreme C o u r t h a s r e c e n t l y r e j e c t e d a
c l a i m s i m i l a r t o R e i t e r ' s i n B i s h o p v . Wood ( 1 9 7 6 ) , 426 U.S. 341,
96 S . C t . 2074, 48 L.Ed.2d 684. A p o l i c e m a n who had become a
permanent employee a f t e r p a s s i n g t h e p r o b a t i o n a r y s t a g e claimed
h e w a s e n t i t l e d t o a p r e t e r m i n a t i o n h e a r i n g by v i r t u e o f a c i t y
o r d i n a n c e p r o v i d i n g t h a t p e r m a n e n t e m p l o y e e s c o u l d be d i s c h a r g e d
f o r u n s a t i s f a c t o r y performance, negligence, i n e f f i c i e n c y or
unfitness. The C o u r t , r e c o g n i z i n g t h a t a p r o p e r t y i n t e r e s t c o u l d
b e c r e a t e d by o r d i n a n c e o r by i m p l i e d c o n t r a c t , s t a t e d t h a t i n
e i t h e r case t h e l e g i t i m a c y o f t h e claim u l t i m a t e l y m u s t be
d e c i d e d by r e f e r e n c e t o s t a t e l a w . Based o n s t a t e l a w t h e C o u r t
f o u n d t h a t t h e p o l i c e m a n h e l d h i s j o b a t t h e w i l l and p l e a s u r e o f
the city. F u r t h e r , t h e p o l i c e m a n had no " l i b e r t y " i n t e r e s t , f o r
e v e n a s s u m i n g h i s d i s c h a r g e w a s u n j u s t i f i e d it i s n o t a s i g n i f i -
c a n t d e p r i v a t i o n when o n e ' s d i s c h a r g e m e r e l y makes o n e l e s s
a t t r a c t i v e to o t h e r employees.
I t is c l e a r f r o m t h e a b o v e - d i s c u s s e d cases t h a t p r o p e r t y
i n t e r e s t s are c r e a t e d and d e f i n e d by s t a t e l a w . The Montana
s t a t u t e c r e a t e s no p r o p e r t y i n t e r e s t i n employment i f t h e r e is n o
s p e c i f i e d term. Appellant seeks t o circumvent the s t a t u t e
t h r o u g h a t h e o r y o f i m p l i e d c o n t r a c t and i m p l i e d c o v e n a n t o f good
f a i t h and f a i r d e a l i n g . I n e f f e c t h i s a r g u m e n t is t h a t d u e t o
h i s l o n g e v i t y o f s e r v i c e he had a n i m p l i e d c o n t r a c t o f
e m p l o y m e n t , t h a t i n t h e i m p l i e d c o n t r a c t t h e r e was a n i m p l i e d
c o v e n a n t o f good f a i t h , and t h a t h i s d i s c h a r g e w a s i n bad f a i t h .
A p p e l l a n t d o e s n o t claim a b r e a c h o f c o n t r a c t , b u t r a t h e r a r g u e s
t h a t t h e i m p l i e d c o v e n a n t o f good f a i t h c o n s t i t u t e d a p r o p e r t y
i n t e r e s t e n t i t l i n g him t o d u e p r o c e s s .
T h e r e is some b a s i s f o r i m p l y i n g c o v e n a n t s o f good f a i t h
i n contracts. S e e s e c t i o n 28-1-201, MCA; F o l e y v. Community O i l
Co., Inc., (D.C.N.H. 1 9 7 4 ) , 64 F.R.D. 561; Monge v . Beebe R u b b e r
Co. (N.H. 1 9 7 4 ) , 3 1 6 A. 2d 5 4 9 ; F o r t u n e v. N a t i o n a l C a s h R e g i s t e r
( 1 9 7 7 ) , 373 Mass. 96, 364 N.E.2d 1251. A l l o f t h e s e cases were
b r e a c h o f c o n t r a c t a c t i o n s and none i n v o l v e d a s t a t u t e . I n Monue
t h e c o u r t d i s c u s s e d t h e common-law r u l e o f a t - w i l l employment
c o n t r a c t s , n o t i n g t h a t it was h a r s h and o u t d a t e d , t h e n m o d i f i e d
t h e r u l e by h o l d i n g t h a t t e r m i n a t i o n m o t i v a t e d by bad f a i t h o r
r e t a l i a t i o n c o n s t i t u t e d a breach of c o n t r a c t . A f t e r t h i s m d i f i-
c a t i o n of the " a t - w i l l " r u l e , t h e New Hampshire f e d e r a l c o u r t i n
F o l e y a p p l i e d it i n d e n y i n g t h e e m p l o y e r ' s m o t i o n f o r j u d g m e n t o n
the pleadings. The F o l e y case i n v o l v e d a n e m p l o y e e o f 40 y e a r s
s e r v i c e who w a s u n j u s t l y d i s c h a r g e d . The f e d e r a l d i s t r i c t c o u r t
s t a t e d t h a t l o n g e v i t y o f s e r v i c e m i g h t g i v e r i s e to a n i m p l i e d
c o n t r a c t r i g h t , b u t t h e c o u r t was no l o n g e r bound by t h e s t r i c t
common-law " a t - w i l l " r u l e a c c o r d i n g to t h e l a w of t h e s t a t e i n
w h i c h it was s i t t i n g . In Massachusetts, t h e d i s c h a r g e of an
e m p l o y e e who had s e r v e d f o r 2 5 y e a r s w a s found t o be a b r e a c h of
t h e i m p l i e d c o v e n a n t o f good f a i t h b e c a u s e t h e e m p l o y e r w a s
a t t e m p t i n g t o avoid payment o f a s u b s t a n t i a l commission. I n none
o f t h e s e cases was t h e r e a p r o c e d u r a l d u e p r o c e s s i s s u e .
The d o c t r i n e o f good f a i t h and f a i r d e a l i n g i n c o n t r a c t s
h a s b e e n n a r r o w l y a p p l i e d i n cases w h e r e u n c o n s c i o n a b l e c o n d u c t
o n a n e m p l o y e r ' s p a r t m u s t be d e t e r r e d . The d o c t r i n e h a s a l s o
been used e x t e n s i v e l y i n i n s u r a n c e l a w to p r o t e c t t h e i n s u r e d .
S e e F i r s t S e c u r i t y Bank o f Bozeman v. Goddard (1979X -Mont -I .
5 9 3 P.2d 1 0 4 0 , 36 S t . R e p . 854. I n K e n n e a l l y v. Orgain ( 1 9 8 0 ) ,
Mont . , 606 P.2d 1 2 7 , 37 S t . R e p . 1 5 4 , we r e j e c t e d a claim i n
t o r t f o r w r o n g f u l d i s c h a r g e , a l t h o u g h t h e e m p l o y e e had s e v e n
y e a r s o f s e r v i c e , b e c a u s e t h e r e was no v i o l a t i o n o f p u b l i c p o l i c y .
A p p e l l a n t ' s argument on implied c o n t r a c t s cannot success-
f u l l y c i r c u m v e n t t h e Montana s t a t u t e which c l e a r l y d e n i e s h i s
c l a i m of e n t i t l e m e n t t o c o n t i n u e d employment. Even t h o u g h
a p p e l l a n t may h a v e had a n i m p l i e d c o n t r a c t w i t h t h e c o u n t y by
v i r t u e o f h i s l o n g e v i t y o f s e r v i c e , i t would be a c o n t r a d i c t i o n
i n terms t o s a y t h a t he had a n " i m p l i e d s p e c i f i e d " p e r i o d o f
employment. A s p e c i f i e d t e r m is o n e which t h e p a r t i e s e x p r e s s e d ,
a n d t h e r e was no e x p r e s s i o n h e r e c o n c e r n i n g t h e l e n g t h o f t h e
employment. S e c t i o n 39-2-503, MCA, o p e r a t e s t o f i l l t h e gap l e f t
b y t h e p a r t i e s by d e f i n i n g t h e r e l a t i o n s h i p as a n " a t - w i l l "
employment. W h i l e t h e r u l e may w e l l be o u t d a t e d , it is u n i q u e l y
a p r o v i n c e of t h e l e g i s l a t u r e t o change it.
F u r t h e r , a s s u m i n g a r g u e n d o t h a t a p p e l l a n t had a n i m p l i e d
c o n t r a c t w i t h a n i m p l i e d c o v e n a n t o f good f a i t h , t h e e m p l o y e r d i d
n o t a c t i n bad f a i t h b e c a u s e i t s c o n d u c t was s t a t u t o r i l y
permissible. R e i t e r was n o t employed o n a " d i s c h a r g e f o r c a u s e
o n l y " b a s i s , a c c o r d i n g to t h e s t a t u t e .
I n summary, w e h o l d t h a t a p p e l l a n t was n o t d e n i e d h i s p r o -
c e d u r a l d u e p r o c e s s r i g h t s when he was d i s c h a r g e d w i t h o u t a
h e a r i n g b e c a u s e s e c t i o n 39-2-503, MCA, n e g a t e s h i s claim o f a
p r o p e r t y i n t e r e s t p r o t e c t e d by t h e U n i t e d S t a t e s and Montana
Constitutions.
11. ENFORCEABLE PROMISE, WAIVER AND ESTOPPEL
The r e c o r d i n d i c a t e s t h a t a t a m e e t i n g w i t h t h e com-
m i s s i o n e r s o n S e p t e m b e r 1 8 , 1 9 7 9 , R e i t e r was r e p e a t e d l y p r o m i s e d
a hearing. The c o m m i s s i o n e r r e f u s e d t o d i s c u s s t h e r e a s o n s f o r
h i s d i s c h a r g e , s t a t i n g t h a t a h e a r i n g would be s c h e d u l e d . Sub-
s e q u e n t l y , o n O c t o b e r 23, 1 9 7 8 , R e i t e r r e c e i v e d a l e t t e r from t h e
d e p u t y c o u n t y a t t o r n e y , which s t a t e d i n p a r t :
" ... o u r s t u d i e s h a v e i n d i c a t e d t h a t you a r e
n o t e n t i t l e d t o a g r i e v a n c e h e a r i n g , and t h e r e -
f o r e none w i l l be s c h e d u l e d ."
The e f f e c t o f t h e l e t t e r w a s t o d e n y R e i t e r t h e o p p o r t u n i t y t o
r e f u t e t h e c h a r g e s made a g a i n s t him i n t h e l i s t o f r e a s o n s f o r
h i s discharge. The i s s u e is w h e t h e r R e i t e r w a s e n t i t l e d t o a
h e a r i n g by v i r t u e o f t h e c o m m i s s i o n e r s 1 p r o m i s e to h o l d a
hearing.
The p r o m i s e t o h o l d a h e a r i n g was n o t s u p p o r t e d by a n y
independent consideration. T h e r e f o r e , it w a s n o t a n e n f o r c e a b l e
p r o m i s e u n d e r c o n t r a c t law, i n d e p e n d e n t o f t h e employment
contract. N o r c o u l d t h e p r o m i s e be e n f o r c e a b l e a s a n i m p l i e d
term o f R e i t e r l s i m p l i e d c o n t r a c t o f e m p l o y m e n t , a s s u m i n g h e had
such a contract. When R e i t e r was e m p l o y e d , t h e p r e d e c e s s o r to
s e c t i o n 39-2-503, MCA, was i n e f f e c t . That s t a t u t e provides t h a t
a n employment w i t h o u t a s p e c i f i e d l e n g t h may be t e r m i n a t e d a t t h e
w i l l of t h e employer, i.e. t h a t no r e a s o n o r good c a u s e need be
shown. T h i s s t a t u t e was i n e f f e c t a p a r t o f t h e employment
c o n t r a c t b e t w e e n t h e c o u n t y and R e i t e r . A promise t o hold a
h e a r i n g , g i v e n a t a l a t e r d a t e , c o u l d n o t modify t h a t p a r t of t h e
c o n t r a c t w i t h o u t i n d e p e n d e n t c o n s i d e r a t i o n u n l e s s c o n s e n t e d to by
both parties in writing. S e c t i o n 28-1-1601, MCA.
Did t h e p r o m i s e o p e r a t e a s a w a i v e r o f t h e c o u n t y l s r i g h t
t o f i r e Reiter w i t h o u t a h e a r i n g ? A w a i v e r is d e f i n e d as t h e
i n t e n t i o n a l and v o l u n t a r y r e l i n q u i s h m e n t o f a known r i g h t , claim
or p r i v i l e g e . F a r m e r ' s E l e v a t o r C o . of R e s e r v e v. A n d e r s o n
( 1 9 7 6 ) , 1 7 0 Mont. 1 7 5 , 5 5 2 P.2d 63. The r e c o r d i n d i c a t e s t h a t
t h e c o m m i s s i o n e r s were n o t e v e n aware t h a t Reiter was n o t
e n t i t l e d to a h e a r i n g a t t h e t i m e t h e y p r o m i s e d t h e h e a r i n g . If
t h e y d i d n o t know o f t h e i r r i g h t t o f i r e R e i t e r w i t h o u t a
h e a r i n g , t h e y c o u l d n o t h a v e v o l u n t a r i l y and i n t e n t i o n a l l y w a i v e d
that right.
A w a i v e r c a n a l s o a r i s e by c o n d u c t , i n which case i t is
c a l l e d an "implied waiver." This doctrine requires a detrimental
r e l i a n c e by t h e p a r t y who is l e d by t h e c o n d u c t to b e l i e v e a
waiver has occurred. See S t a n o l i n d O i l & Gas C o . v . Guertzgen
( 9 t h C i r . 1 9 3 9 ) , 1 0 0 F.2d 299; B l a c k l s Law D i c t i o n a r y , p. 1 7 5 2 .
T h u s t h e d o c t r i n e o f " i m p l i e d w a i v e r " is a k i n to e s t o p p e l .
The e l e m e n t s o f e s t o p p e l a r e s e t f o r t h i n s e c t i o n
26-1-601, MCA. E s s e n t i a l t o t h e d o c t r i n e is t h e d e t r i m e n t a l
r e l i a n c e by t h e i n n o c e n t p a r t y upon t h e r e p r e s e n t a t i o n s o f t h e
other party. I n t h i s case, t h e r e c o r d shows n o e v i d e n c e o f
r e l i a n c e by R e i t e r . R e i t e r was p r o m i s e d a h e a r i n g and a l s o
o f f e r e d a r e i n s t a t e m e n t as a j a n i t o r r a t h e r t h a n a s u p e r v i s o r .
From R e i t e r t s d e p o s i t i o n it is a p p a r e n t t h a t h e d i d n o t r e f u s e
t h e d e m o t i o n as a r e s u l t o f t h e p r o m i s e o f a h e a r i n g . R a t h e r he
r e f u s e d t h e d e m o t i o n b e c a u s e t h e p r o p o s e d c o n t r a c t s r e q u i r e d him
t o a c k n o w l e d g e t h a t h i s b e h a v i o r was u n s a t i s f a c t o r y and h e f e l t
t h e s e c o n t r a c t s were d e m e a n i n g . T h e r e f o r e , s i n c e t h e r e is n o
e v i d e n c e o f a d e t r i m e n t a l change i n p o s i t i o n due to t h e promise,
t h e d o c t r i n e s o f e q u i t a b l e e s t o p p e l and i m p l i e d w a i v e r d o n o t
apply
S i n c e R e i t e r h a s no d u e p r o c e s s r i g h t t o a h e a r i n g and t h e
commissioners p r o m i s e was u n e n f o r c e a b l e , t h e r e s p o n d e n t ' s m o t i o n
f o r summary j u d g m e n t was p r o p e r l y g r a n t e d .
The o r d e r o f t h e D i s t r i c t C o u r t e n t e r i n g summary j u d g m e n t
i n f a v o r o f t h e r e s p o n d e n t s is h e r e b y a f f i r m e d .
Chief J u s t i c e
T h i s c a u s e was s u b m i t t e d f o r d e c i s i o n p r i o r to J a n u a r y
5, 1 9 8 1 .
Mr. J u s t i c e D a n i e l J. S h e a w i l l f i l e a w r i t t e n d i s s e n t l a t e r .
Mr. J u s t i c e J o h n Conway H a r r i s o n d i s s e n t i n g :
I must d i s s e n t w i t h t h e o p i n i o n o f t h e C o u r t on t h e
basis of the provisions of section 28-1-201, MCA. This
provision i n our law, i n my o p i n i o n , c a n be looked t o in
fact situations such as this as a statute to protect
persons, such t h e p e t i t i o n e r i n t h i s c a s e , who h a v e a l o n g
p e r i o d of p u b l i c employment. S e c t i o n 28-1-201 provides:
"General d u t y of c a r e . Every p e r s o n is
bound, w i t h o u t c o n t r a c t , t o a b s t a i n from
injuring t h e person o r property of another or
i n f r i n g i n g upon a n y o f h i s r i g h t s . "
Developing in the law around t h e United S t a t e s a r e
r e m e d i e s f o r e m p l o y e e s who s e r v e u n d e r t h e " a t - w i l l " statute
and r u l e . The more e q u i t a b l e and j u s t r u l e , i n my o p i n i o n ,
i s t h a t an i m p l i e d c o n t r a c t e x i s t s b e t w e e n t h e e m p l o y e r and
the employee which gives additional consideration to an
e m p l o y e e o f some e i g h t e e n y e a r s o f c o n t i n u o u s employment, a s
i n t h i s case. F o l e y v . Community O i l Company, I n c . (D. N.H.
1974), 64 F.R.D. 561; Monge v. Beebe Rubber Co. (N.H.
1 9 7 4 ) , 316 A.2d 549; F o r t u n e v. N a t i o n a l C a s h R e g i s t e r Co.
( 1 9 7 7 ) , 373 Mass. 9 6 , 364 N.E.2d 1251.
I n Monge t h e c o u r t r e v i e w e d t h e common-law r u l e of
"at-will" employment c o n t r a c t s . The Monge c o u r t n o t e d t h a t
t h e r u l e was h a r s h and o u t d a t e d , and t h e n m o d i f i e d t h e r u l e
by h o l d i n g t h a t a d e t e r m i n a t i o n m o t i v a t e d by bad faith or
retaliation constituted a breach of contract. It was a
m o d i f i e d " a t - w i l l " r u l e t h a t t h e N e w Hampshire F e d e r a l C o u r t
a p p l i e d t o d e n y a n e m p l o y e r ' s m o t i o n f o r a judgment on t h e
pleadings.
I n F o l e y , when a n employee o f f o r t y y e a r s o f s e r v i c e
was u n j u s t l y d i s c h a r g e d , t h e Federal D i s t r i c t Court s t a t e d
t h a t t h e l o n g e v i t y of s e r v i c e should g i v e r i s e t o an implied
contract right but that the court was no longer bound by the
strict common-law "at-will" rule according to New Hampshire
law.
The next case, the Massachusetts case of Fortune v.
National Cash Register Co., supra, involved an employee who
was discharged after working for the company some twenty-
five years. The Court found that there was a breach of an
implied contract of good faith because the employer was
attempting to avoid payment of a substantial commission.
While it has not been established that a public
employee with longevity has a constitutional right to a
continued position, I believe the rule established is that
one is entitled to a hearing before he is summarily
discharged, as appellant was in this case. I would hold
that the summary dismissal of appellant violated a due
process right. Slochower v. Board of Education (1956), 350
U.S. 551, 76 S.Ct. 637, 100 L.Ed. 672.
For the above reasons, I would return the matter to
the District Court and require that a full hearing be given
to appellant in this matter.