Texas Farm Bureau Insurance Companies v. Sears

GRAY, Justice,

dissenting.

This is nothing more than yet another attack on the employment-at-will doctrine in Texas.1 Having failed to timely pursue a slander or libel claim, Sears now attempts to reshape the facts and damages appropriate for those claims as attributable to negligence, gross negligence, and intentional infliction of emotional distress.

At-will Employment Is Dead

(Negligence and Gross Negligence Claims)

Regardless of Farm Bureau’s negligence, if any, in conducting the investigation — it is not actionable by Sears. Farm Bureau owed Sears no duty.2 This is an area of the law in which there is a specific need to draw a bright line distinction between the duty owed in connection with an investigation related to an “at-will” employment decision and an investigation conducted for other reasons.

Farm Bureau has included in its brief a lengthy section citing courts from other states that have considered and rejected a cause of action for negligent investigation in the termination of an at-will relationship. We need not go outside the State of Texas. The Corpus Christi Court of Appeals has recently decided this issue contrary to Sears and contrary to the majority’s decision to recognize a cause of action for negligent investigation before exercising the right to terminate an at-will relationship. The Corpus Christi Court decided the issue as follows:

Lane also argues we should recognize a new cause of action against employers. He urges this Court to impose upon employers an implied duty to exercise reasonable care when conducting a sexual harassment investigation. However, we refuse to create a new common law duty which would abrogate the traditional at-will employment contract. Absent a contract, the relationship between worker and employer is “at will,” except for a few very narrow exceptions, with each party being able to end it at any time without reason or justification. See East Line & R.R.R. Co. v. Scott, 72 Tex. 70, 10 S.W. 99, 102 (1888); Winters v. Houston Chronicle Pub. Co., 795 S.W.2d 723, 726 (Tex.1990); see also Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733, 735 (Tex.1985) (recognizing a narrow exception for an employee discharged for the sole reason of refusing to perform an illegal act). The Texas Supreme Court has refused to impose a general duty of good faith and fair dealing upon employers under an at-will employment agreement. City of Midland v. O’Bryant, 18 S.W.3d 209 (Tex.2000). Likewise, we decline to recognize a duty in this situation.
Under the traditional at-will employment agreement, Wal-Mart had the absolute right to fire Lane for any reason *378or for no reason at all. Wal-Mart had no duty to perform any investigation before discharging Lane. Cf. Rios v. Texas Commerce Bancshares, Inc., 930 S.W.2d 809, 816 (Tex.App.—Corpus Christi 1996, writ denied) (finding that employment-at-will contract cannot support a negligent investigation cause of action because employer has no duty to reasonably investigate allegations against an employee). Thus, Wal-Mart owed no duty to Lane while performing the investigation. Lane has directed us to no case in which a general negligence cause of action has been used against an employer for negligent investigation, and we have not located any such case or closely analogous situations. See also Sibley, 998 S.W.2d at 403 (also finding no case where a general negligence theory has been used to support a cause of action against an employer for negligent investigation); cf. City of Midland, id. Further, no Texas Supreme Court case has held that an employee is protected from being fired as a result of a negligent employer investigation into a claim of sexual harassment. We hold that there is no evidence to support the jury’s answers to questions six and seven. We sustain the second issue.

Wal-Mart Stores, Inc. v. Lane, 31 S.W.3d 282, 294 (Tex.App.—Corpus Christi 2000, pet. ref'd).

To hold otherwise effectively kills the employment-at-will doctrine. We should follow the decision of the Corpus Christi Court of Appeals and thus avoid a conflict between different courts of appeals on this issue. We should not create a new cause of action, especially one that has such a potential for changing the traditional employment-at-will doctrine in the State of Texas.

With the majority having imposed liability for negligent investigation in connection with the termination of an at-will relationship, the next question we will inevitably have to answer is what is an investigation? Is a single question an “investigation” that will trigger potential liability for the discharge of an at-will employee? What if a critical follow-up question was not asked? Unfortunately the only “safe” way to dismiss an “at-will” employee will be to not ask any questions and simply walk up to an employee and open the conversation with ‘Tour services are no longer needed. You are terminated.” For me, this is an intolerable consequence of the majority’s holding.

It is critical to note that holding there is no duty owed to Sears in the conduct of the investigation ordinarily would still leave Sears with a remedy. If Farm Bureau libeled or slandered Sears based on the results of a shoddy investigation, the result could be entirely different, not because the investigation was negligently performed, but for the separate tort of libel or slander. Unfortunately for Sears, due to his delay in seeking relief, the statute of limitations prevented his attempt to recover under either of these theories. I would hold Farm Bureau owed Sears no duty for the way in which the investigation was conducted. This holding would require that we reverse and render rather than reverse and remand Sears’s negligence and gross negligence claims. Because the majority reverses and remands these claims, I respectfully dissent.

Intentional Infliction of Emotional Distress

With regard to the intentional infliction of emotional distress, the majority does what it has done in the past. It recites the proper rules but then, in my opinion, misapplies them to the facts. See Bluewater Constructors, Inc. v. Murphey, No 10-98-187 CV (Tex.App.—Waco, June 21, 2000, *379pet. ref'd)(not designated for publication). Based upon my review I do not find, under Sears’s version of the facts, that Farm Bureau’s conduct was “extreme and outrageous.” Farm Bureau was doing what it had a right, and possibly a duty, to do by conducting the investigation, not just of Sears’s potential participation in a scheme to defraud an insurance company, but also investigating other people involved in the scheme, terminating the at-will relationship with Sears, and ultimately reporting the findings to various entities.

To meet the second element of intentional infliction of emotional distress, that the defendant’s conduct must be extreme and outrageous, the conduct of Farm Bureau must be “so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.” Natividad v. Alexsis, Inc. 875 S.W.2d 695, 699 (Tex.1994); Rescar Inc. v. Ward, — S.W.3d —, — , No. 01-99-00038-CV, 2001 WL 754779, 2001 Tex.App. Lexis 4565, at *21 (Houston [1st Dist .] July 5, 2001, no pet. h.)(citing Diamond Shamrock Refining v. Mendez, 844 S.W.2d 198, 202 (Tex.1992) quoting Restatement § 46, comment d).

In Rescar, even the threat to “blackball” the plaintiff in the industry was not enough to support a claim for intentional infliction of emotional distress. The court held that “liability does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities.” Id. “[E]ven when the employer’s conduct rises to the level of illegality, except in the most unusual cases, it is not the sort of conduct, deplorable as it may sometimes be, that constitutes extreme and outrageous conduct.” Id at * 20, at-.

Accordingly, I would hold that Sears failed to establish the second element of his intentional infliction of emotional distress claim.

But the most fundamental problem with Sears’s intentional infliction of emotional distress claim is the complete lack of evidence of the forth element of the claim, “severe” emotional distress.

“Severe emotional distress” means distress so severe that no reasonable person could be expected to endure it. GTE Southwest, Inc. v. Bruce, 998 S.W.2d 605, 618 (Tex.1999)... .Emotional distress was held to be severe when a plaintiff feared for his life, slept with a pistol, cried in public, and lost his appetite. Behringer v. Behringer, 884 S.W.2d 839, 844-45 (Tex.App.—Fort Worth 1994, writ denied). Similarly, emotional distress was held to be severe when a plaintiff refused to speak or see anyone, became ill and disoriented, and experienced extreme anger. Tidelands Auto. Club v. Walters, 699 S.W.2d 939, 945 (Tex.App.—Beaumont 1985, writ ref'd n.r.e.). In contrast, feelings of anger, depression, and humiliation (even when embarrassed in front of one’s children), are insufficient to constitute severe distress. Regan v.. Lee, 879 S.W.2d 133, 136-37 (Tex.App.—Houston [14th Dist.] 1994, no writ.)

Id. at *23-24, at — - —.

The evidence of the plaintiffs emotional distress in Rescar was that be became depressed for about a year but had recovered on his own. The experts characterized it as “a mild to medium” form of major depression. The court held that the plaintiff

did not suffer emotional distress to the degree required to recover for intentional infliction of emotional distress. While his distress may have been “serious,” *380the evidence did not support a finding that it was “severe.”

Id. at *24, at —.

There is no evidence that Sears suffered any damages other than economic losses that any other at-will employee would have suffered for the sudden loss of their job. Sears first was questioned about the loss of income caused by the termination. He was then asked about the other consequences of being terminated. The full extent of the evidence of the other consequences for Sears caused by the actions of Farm Bureau is as follows:

Q. Now, after you lost the income from the insurance business, were there consequences of that?
A. Yes, sir. We—
Q. What were they?
A. We had to actually make a almost complete turnaround on our life-style. I had some property that was mortgaged. I — I lost that. I couldn’t — couldn’t pay— make the payments on that. I had to cancel my retirement program that I had with the company. I was putting in $300 a month, and they were matching part of that, and I had to cash that in. I had to cancel my life insurance policies. I couldn’t afford to pay the premium on those.
Q. What about things at home, in general, after?
A. Well, we were — we had been helping our children as much as possible, you know, throughout the time, and I could not help them anymore. We couldn’t trade vehicles or anything like that. I’m — well, at the time, I’m driving a '88 model vehicle with about 220 something thousand miles on it. My wife drives an '84 model with almost that many miles. We — we can’t afford any— anything. It’s just — we just sitting on a — on zero, period.

This testimony is nothing more than additional economic, not emotional, consequences of having lost his job. There is no testimony regarding the emotional consequences on Sears of Farm Bureau’s actions. The evidence presented is not what the Supreme Court and other courts of appeals have characterized as severe emotional distress.

Accordingly I would also reverse the trial court’s judgment and render judgment that Sears take nothing from Farm Bureau on his claim of intentional infliction of emotional distress. Because the majority does not, I respectfully dissent.

. The parties have treated this case as being controlled by the employment-at-will doctrine because there is a written contract that specified Sears's agency agreement could be terminated at-will by giving ten days notice.

. For a discussion of the role of the court in defining the duty, see William Powers, Jr., W. Page Keeton Symposium on Tort Law: Judge and Jury in the Texas Supreme Court, 75 Texas. L.Rev. 1699 (1997).