No. 89-169
IN THE SUPREME COURT OF THE STATE OF MONTANA
1989
DAVID COOMBS,
Plaintiff and Appellant,
-vs-
GAMER SHOE COMPANY,
A Montana corporation,
Defendant and Respondent.
APPEAL FROM: District Court of the First Judicial District,
In and for the County of Lewis & Clark,
The Honorable Henry Loble, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Ronald F. Waterman; Gough, Shanahan, Johnson and
Waterman, Helena, Montana
For Respondent:
Gary M. Zadick and Mark F. Higgins; Ugrin, Alexander,
Zadick & Slovak, Great Falls, Montana
- Submitted on Briefs: Aug. 3, 1989
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-2 2 % Decided: August 25, 1989
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Justice John Conway Harrison delivered the Opinion of the
Court.
This case originated as a wrongful discharge action in
the First Judicial District Court, Lewis and Clark County.
Appellant asserted that his termination breached the implied
covenant of good faith and fair dealing. The District Court
granted respondent Gamer Shoe Company's (Gamers) motion for
summary judgment and appellant Coombs appeals that decision.
We affirm.
Coombs presents essentially one issue for review. Did
the District Court err in holding that no genuine issue of
material fact existed regarding respondent's claim that
Coombs lost his job as part of a legitimate reduction in work
force.
David Coombs began working for Gamers in 1 9 7 7 at the
Carlson's store in Great Falls. Gamers had previously
purchased Carlson's. Within a month Coombs was promoted to
store manager. He worked as the manager of Carlson's until
the fall of 1 9 8 3 when he was promoted to the position of
buyer of children's and men's shoes. Another Gamers
employee, Roger Howell, transferred to Carlson's from a
recently closed Gamers store to fill the position of store
manager. As Coombs' buying position was not full time, he
continued to work as a floor salesperson when not engaged in
his buying duties. Coombs held this position until he left
Gamers.
In August of 1 9 8 6 , Loren Miles, Coombs' supervisor,
informed him that because of poor economic conditions, Gamers
might close Carlson's at the end of its lease period in 1 9 8 7 .
At that time, Carlson's personnel also suffered a wage
reduction. Prior to this, Coombs had written a memo
detailing the poor economic conditions facing the Carlson's
store. Also, after August of 1986, Coombs and other Gamers'
employees shared their concerns about the company's general
economic viability. At that time appellant was aware
specifically that the future of both the Carlson's store and
his position were uncertain. Loren Miles did tell Coombs
that Gamers would do what it could to find him a position.
However, Gamers did not guarantee, either verbally or in
writing, that Coombs would still have a position with Gamers
if the Carlson's store closed.
In mid-April of 1987, Miles informed Coombs that Gamers
had decided to close Carlson's at the end of summer. Coombs'
position, along with the two other Carlson's employees, both
senior to Coombs in date of hire, would be eliminated.
Management would assume Coombs' buying duties. Gamers gave
Coombs the opportunity to continue working part-time as a
salesperson until the store actually closed. Coombs declined
the offer. The store did close and none of the Carlson's
employees were retained as Gamers' employees. No one was
hired to replace Coornbs as a buyer. Coombs does not contend
that Gamers terminated him for cause. He does contend that
Gamers should have found a place for him even though he
testified that Gamers did not guarantee him a job. Gamers'
management testified that Coombs was a loyal and satisfactory
employee.
Relying on facts from appellant's deposition, the
District Court concluded that respondent was entitled to
summary judgment. Summary judgment is proper when no genuine
issue of material fact exists and the moving party is
entitled to judgment as a matter of law. The movant has the
burden of showing a complete absence of any genuine issue as
to all facts considered material in light of the substantive
principles that entitle the movant to a judgment as a matter
of law, and all reasonable inferences that may be drawn from
the offer of proof are to be drawn in favor of the opposing
party. Cereck v. Albertson's, Inc. (1981), 195 Mont. 409,
637 P.2d 509. If the moving party makes the necessary
showing, the burden of proof shifts to the party opposing the
summary judgment motion to present evidence of a material and
substantial nature raising a genuine issue of fact. Mayer
Bros. v. Daniel Richard Jewelers, Inc. (1986), 223 Mont. 398,
726 P.2d 815.
Appellant argues that the District Court erred because
it overlooked issues of material fact raised by the record.
Basically, Coombs urges this Court to recognize that two fact
questions exist regarding his claim of breach of the implied
covenant of good faith and fair dealing. Appellant contends
that the record reveals a factual issue on whether Gamers'
reason for eliminating Coombs' position was a pretext.
Further, Coombs claims that a conflict exists on whether
Gamers' actions breached the implied covenant of good faith
and fair dealing because those actions led Coornbs to
reasonably believe that Gamers would find a job for him. We
disagree.
Even if the implied covenant of good faith and fair
dealing governs the employment relationship, an employer may
still terminate an employee as long as the employer gives a
fair and honest reason. Hobbs v. Pacific Hide and Fur Depot
(Mont. 1989), 771 P.2d 125, 130, 46 St.Rep. 544, 550. The
implied covenant of good faith and fair dealing does not
prevent an employer from making legitimate reductions in
workforce necessary to maintain business viability. Flanigan
v. Prudential Savings and Loan (1986), 221 Mont. 419, 426,
720 P.2d 257, 261. Further, an employer "is entitled to be
motivated by and serve its own legitimate business interest
and must be given discretion in determining who it will
employ and retain in employment." Hobbs, 7 7 1 P.2d at 1 3 0 .
In the instant case, it is undisputed that Gamers had
for some period of time experienced financial difficulties
that necessitated closing several stores including the Great
Falls Carlson's store. Although appellant argues that
respondent should have made a more particularized proof
regarding economic necessity, facts and figures certainly are
not required when all parties admit that the business was in
trouble and the business actually closed. Coombs knew of the
economic difficulties of Gamers in general and of the Great
Falls Carlson's store in particular. For some time prior to
his termination, he knew that the Carlson's store might close
and that his job was in jeopardy. None of the Carlson's
store employees from Great Falls were given other positions
in the company.
Although Gamers did tell Coombs that it would try to
find a place for him, Coombs testified that these assurances
were not promises and did not guarantee him continuing
employment with Gamers. Coombs also concedes that he had no
right to continued employment based on seniority. As well,
Coombs testified that Gamers did not terminate him for cause.
In short, the record establishes that Gamers discharged
Coombs for legitimate economic reasons. Therefore, Gamers
did not violate the covenant of good faith and fair dealing
implied in its employment relationship with Coombs.
As appellant points out, the record does disclose some
conflict between his deposition testimony and that of Loren
Miles regarding Coombs seeking manager positions in other
Gamers stores. However, given the equivocal nature of
Coombs' testimony on his efforts to transfer out of Great
Falls, this conflict does not appear genuine. Even if the
conflict raised a genuine issue of fact, the issue is not
material to the substantive law in this case. Gamers
admittedly did not have any obligation to find Coombs another
position within the company, by either express personnel
policy or any verbal or written promises of management.
Further, this Court recognizes that employers must have
discretion in making personnel decisions. Hobbs, 771 P.2d at
130. Thus, absent any evidence of dishonesty or pretext,
even if Coombs had been passed over for manager positions,
Gamers' actions would be appropriate given an employer's
discretion to make personnel decisions it feels are in its
best interests. No evidence of pretext exists in the record.
Therefore, any issue that does exist on whether Coombs
actively sought transfers is not a material issue and thus
does not preclude summary judgment.
Appellant also argues that Gamers constructively
discharged him. The record does not support this theory.
We affirm the District Court.
We concur:
ii