NO. 83--277
IN THE SUPREME COURT OF THE STATE OF MONTANA
1984
PAT LINZ,
Plaintiff and Appellant,
-vs-
CHAMPION INTERNATIONAL CORPORATION,
Defendant and Respondent.
APPEAL FROM: District Court of the Fourth Judicial District,
In and for the County of Missoula,
The Honorable James B. Wheelis, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Boone, Karlberg & Haddon; Randy J. Cox argued,
Missoula, Montana
For Respondent:
Garlington, Lohn & Robinson; Robert E. Sheridan
argued, Missoula, Montana
Submitted: December 15, 1983
Decided: January 31, 1984
Filed: dhjl ,.i; !$a4
Clerk
Mr. Chief Justice Frank I. Saswell delivered the Opinion of
the Court.
Pat Linz appeals from a iudgment of the Missoula County
District Court dismissing his complaint for severance pa.y
benefits allegedly due from Champion International Corpora-
tion, respondent. We affirm.
Linz was a salaried employee of the Intermountain
Division of Hoerner Waldorf Corporation from 1962 to 1977.
In 1977, Hoerner Waldorf was merged with Champion Interna-
tional Corporation. At the time of the merger, Linz was the
data. processing manager for the Division. As of April 1,
1977, Champion adopted a severance pay policy for salaried
employees of either corporation whose employment was termi-
nated as a result of the merger. The pertinent part of the
policy states:
"Salaried employees of Hoerner Waldorf
and other units of Champion International
whose employment is terminated as a
result of the merger shall be entitled. to
severan.ce pay based upon length of
service. "
Champion offered Linz employment as manager of the
Rocky Mountain Terminal Center after the merger. The salary
was equal to that of his position with Hoerner Waldorf with
an increase scheduled for the second quarter of 1977.
Li-nz felt the position offered by Champion was not of
the same status as his position with Hoerner Waldorf so he
refused the offer. He did not receive severance pay. Howev-
er, he did remain employed by Champion for a short period of
time, at double salary, to assist in the transition. He
brought suit in 1.979 to recover severance pay, statutory
penalty and attorney fees asserting that the merger caused
termination of his position and, thus, he fell under the
severance pay policy.
The trial was conducted on February 15, 1983, and the
testimony was directed at whether the two positions were
similar in status and function. Linz indicated his previous
position entailed computer programming, system design, analy-
sis and impl-ementation, user services and data processing.
He also testified that this position allowed a large amount
of independence and involved some responsibility and
management.
Linz stated that the new position wou1.d require less
system design, implementation and programming. He said that
Champion officials told him that he would have to go to the
company computer center in Ohio for this type of work. Linz
also testified that the new position would be less autonomous
and allow less creativity.
The court heard testimony from Richard Fettkether, a
computer expert with twenty-five years of experience. He
stated the new position would not include systems analysis,
design or development. Further, he indicated that, as com-
pared to the prior position, the new job did not offer any
professional growth and demanded lesser skills and abilities.
Patricia Jeffries testified that she was employed by
Hoerner Waldorf and turned down an offer from Champion to
continue working. However, she received severance pay. She
also stated that she refused Champion's offer because the new
position did not involve large scale buying as did her job
with Hoerner Waldorf.
William Nelson eventually took the job offered to Linz.
Over Linz's obiection, he testified that he had been involved
in systems design and analysis, user services and data pro-
cessing in wage, payroll, ledger accounting and accounts
payable. He also said that when he took over the terminal
center he was responsible for management of the data process-
ing for a certain pulp mill-. This involved systems analysis,
design and programming. He also indicated that he was re-
sponsible for all persons who worked at the terminal center.
It should be noted that most of Nelson's testimony related to
what he was doing presently, not what he was told about the
position when interviewed or what the job originally
involved.
The District Court found the two positions substantial-
ly equivalent, and since Linz declined to accept the latter,
he did not qualify for severance pay. Receipt of severance
pay is not an unqualified right, ruled the court. Rather,
only those employees whose jobs were terminated as a result
of the merger and who were not offered similar positions
could receive severance benefits. Linz did not show the
positions were dissimilar; therefore, the District Court
concluded he did not qualify for severance pay. From this
ruling, Linz appeals and raises three issues for our
consideration.
1. Did the District Court err by concluding that the
appellant's employment had not been terminated, thereby
disqualifying him from severance pay?
2. Did the District Court err in admitting testimony
of William Nelson, the individual who took the job that Linz
refused?
3. Is appellant entitled to the statutory penalty and
attorney fees associated with the recovery of wages?
Linz first argues that Champion's severance pay policy
does not condition severance pay upon the lack of a compara-
ble job offer from Champion. The merger caused termination
of Linz's employment; thus, according to the policy, he
should receive severance pay benefits. Linz also contends
that a severance pay policy establishes a unilateral contract
between employer and employee on which employees have a right
to rely notwithstanding any offers of employment. He relied
on the contract between himself and Champion when he denied
Champion's offer of employment.
Champion claims that the severance pay plan envisioned
termination of employment from the successor company as a
prerequisite for severance pay. Champion also contends that
the subsequent modification of the employment relationship by
oral agreement between Linz and Champion to work several
months more to assist with the transition precludes partici-
pation in the severance pay plan.
The resolution of this issue depends upon whether,
according to our interpretation of the severance pay policy,
Linz's employment was terminated as a result of the merger.
The policy simply provided that those whose employment is
terminated as a result of the merger would receive severance
pay based upon length of service. The District Court based
its decision upon the fact that Linz was offered comparable
employment. We find that this is not a proper basis upon
which to decide the present case. Rather, the policy must be
construed to determine if Linz was terminated because of the
merger. We find that he was not terminated by the merger and,
thus, not entitled to severance pay.
In Towne v. Towne (1945), 117 Mont. 453, 159 P.2d 352,
this Court held that the word "terminate" means "to put an
end to; to make to cease; to end," adopting Webster's defini-
tion. 117 Mont. at 465, 159 P.2d at 357. Black's Law Dic-
tionary utilizes Towne a.s authority for its definition of the
word "terminate." Black's Law Dictionary at 1641 (Rev. 4th
Ed. 1 9 6 8 ) .
In this case, Champion offered Linz a comparable posi-
tion in his city of residence. Further, his salary was equal
to that he received from his position with Hoerner Waldorf
with an increase scheduled for the second quarter of 1 9 7 7 .
From these facts and under the authority of Towne, we cannot
find that Linz's employment was terminated. His position
would not have come to an end nor cease. He would have
continued in essential-ly the same capacity with Champion, at
the same pay, subject, however, to Champion's programs,
policies and management. Thus, Linz was not entitled to
severance pay, and the District Court was correct in so
holding.
Since we have found that comparability of the positions
is not a proper basis for decision, the question in regard to
William Nelson's testimony becomes irrelevant. Also, the
issue regarding statutory penalty and attorney fees in con-
nection with the recovery of wages becomes moot since we have
held that Linz is not entitled to severance pay.
Affirmed.
34-4, b ( d
p I
w
, C
Chief Justice
We c o n c u r :
Justices
Mr. Justice John C. Sheehy, dissenting:
I dissent. The majority, saying the employment policy
must be strictly construed, construe it loosely. This kind
of judicial contraspeak reminded the late United States
Supreme Court Justice Tom Clark of Dante's Bernice, who,
saying she would never consent, consented.
The employment policy does not lend itself to any
construction beyond its own words:
"Salaried employees. . .
whose employment is
terminated as a result of the merger sha1.1 be
entitled to severance pay based. upon the length of
service. "
The majority read into that clear paragraph two
exceptions, (1) "unless a comparable job is offered by the
employer", (2) "at the same pay." Search as I may, I cannot
find those terms in the employer's policy.
The employer d.id not construe its own policy that way.
It granted severance pay to Patricia Jeffries, a purchasing
clerk who turned down a job as a purchasing clerk in the
merged company. Now there was strict construction.
Pat Linz, who was data processing manager for
Intermountain Lumber in Missoul-a, was offered a job by
Champion as manager of the Rocky Mountain Terminal Center in
Bonner. His job with Intermountain Lumber was "terminated as
a result of the merger." His right to severance pay became
absolute. Gaydos v. White Motor Corporation (Mich. 19741 ,
220 N.W.2d 697.
We should reverse, and remand for his rightful award of
attorneys fees and costs.