Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER. 

Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 

303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email 

corrections@appellate.courts.state.ak.us. 

THE SUPREME COURT OF THE STATE OF ALASKA 

CALVIN GRIMMETT, 

Appellant and 

Cross-Appellee, 

v. 

UNIVERSITY OF ALASKA, 

Appellee and 

Cross-Appellant. 

UNIVERSITY OF ALASKA, 

Petitioner, 

v. 

YAUNA TAYLOR, 

Respondent. 

) 

) Supreme Court Nos. S-13944/14093/14083 

) (Consolidated) 

) 

) Superior Court No. 3AN-09-08970 CI 

) 

) O P I N I O N 

) 

) No. 6791 – June 28, 2013 

) 

) 

) 

) 

) Superior Court No. 4FA-08-02579 CI 

) 

) 

) 

) 

) 

) 

) 

) 

) 

Appeal in File Nos. S-13944/14093 from the Superior Court 

of the State of Alaska, Third Judicial District, Anchorage, 

Jack Smith, Judge. 

Appeal in File No. S-14083 from the Superior Court of the 

State of Alaska, Fourth Judicial District, Fairbanks, Michael 

A. MacDonald, Judge. 
 

 

 

 

 

 

Appearances: Kevin T. Fitzgerald, Ingaldson, Maassen & 

Fitzgerald, P.C., Anchorage, for Appellant/Cross-Appellee 

Grimmett. William B. Schendel, Schendel Law Office, 

Fairbanks, and Susan Orlansky, Feldman Orlansky & 

Sanders, Anchorage, for Appellee/Cross-Appellant/Appellant 

University of Alaska. No appearance by Yauna Taylor, 

Respondent. 

Before: Carpeneti, Chief Justice, Fabe and Stowers, Justices. 

[Winfree, Justice, not participating.] 

STOWERS, Justice. 

I. INTRODUCTION 

Yauna Taylor and Calvin Grimmett were employed by the University of 

Alaska. The University terminated their employment through notices of nonretention. 

The University also and alternatively terminated Grimmett for cause. 

Superior Court Judge Michael A. MacDonald found that the University 

violated Taylor’s due process rights when the University nonretained her without a 

hearing rather than terminating her for cause; the court ordered additional briefing on the 

issue of Taylor’s backpay. Superior Court Judge Jack Smith upheld Grimmett’s 

nonretention, finding that the University’s nonretention policy did not violate Grimmett’s 

due process rights. However, Judge Smith set aside Grimmett’s for-cause termination, 

finding that the University had violated the objective prong of the implied covenant of 

good faith and fair dealing. 

The University petitioned for review in Taylor’s case, which we granted. 

Grimmett appealed and the University cross-appealed. We consolidated these cases for 

oral argument and decision because both involved the University’s use of its 

nonretention procedure. We conclude that the University violated Taylor’s due process 

rights when it used its nonretention procedure to terminate her employment without a 

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hearing. We therefore affirm Judge MacDonald’s decision and remand for further 

proceedings concerning the scope of Taylor’s backpay remedy. In Grimmett’s case, as 

in Taylor’s, the University used its nonretention procedure to terminate the employment 

of a for-cause employee without a hearing, in violation of the employee’s due process 

rights. We therefore reverse Judge Smith’s decision upholding Grimmett’s nonretention. 

However, we also reverse Judge Smith’s decision setting aside Grimmett’s for-cause 

termination and hold that the University did not violate the implied covenant of good 

faith and fair dealing when it terminated Grimmett’s employment for cause. We remand 

for further proceedings to determine if Grimmett is entitled to additional pay in light of 

our decision. 

II. FACTS AND PROCEEDINGS 

A. Taylor Facts And Proceedings 

Taylor worked as an “Administrative Generalist” for the University of 

Alaska Fairbanks from May 1, 2005 to May 1, 2008. The University provided Taylor 

with periodic employment letters detailing the terms of her employment.1 Those letters 

explained “[t]his appointment is for ‘regular,’ ‘continuing’ employment with benefits,” 

and then provided “General Conditions of Employment,” which stated in part: 

New employees of the University are employed in an at-will 

probationary status for the first six months of employment. 

Promoted employees also serve a probationary period with 

limited rights of retreat. During the probationary period your 

employment may be terminated for no reason or any reason. 

Pursuant to University Regulation [04.07.100], the University 

also may elect to discontinue employment through nonretention with notice or pay in lieu of notice. 

Taylor’s last employment letter was dated June 27, 2007 and provided that 

the term of employment was August 5, 2007 through June 7, 2008, a ten-month 

appointment period. 

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1 
 

 

 

 

 

The letters also stated that Taylor’s “appointment and other terms of employment are 

governed, in order of priority, by Board of Regents Policy, University Regulations, and 

applicable campus rules and procedures.” Regents Policy 04.01.055(A) states that “Atwill employment is an employment relationship that either the employee or the university 

may terminate at any time for any reason or no reason.”2 Further, “[e]mployment not 

established as at-will entitles the employee to such notice and appeal processes as 

specified by regents’ policy and university regulation.”3 University Regulation 

04.01.050 distinguishes between “At-Will Employment” and “For Cause Employment.” 

The regulation explains that the University “designates employment not established as 

at-will to be for cause.”4 The University concedes that Taylor’s employment was forcause employment. 

In a letter dated April 3, 2008, the University informed Taylor of its 

“decision to exercise its right of nonretention,” citing University Regulation 04.07.100.5 

2 UNIV. OF ALASKA, REGENTS’ POLICY & UNIVERSITY REGULATION 

P04.01.55(A), available at http://www.alaska.edu/bor/policy-regulations/ (last visited 

Mar. 27, 2013). 

3 REGENTS’ POLICY P04.01.55(C). 

4 UNIVERSITY REGULATION R04.01.050(B). 

5 University Regulation 04.07.100 reads, in part: 

If the University elects to discontinue employment through 

nonretention under Regents’ Policy 04.07.100, written notice 

shall be given as required by this section. Provisions of this 

section do not apply to termination of employment pursuant 

to other provisions of Regents’ Policy or University 

Regulation, nor do they apply to employees covered by 

collective bargaining agreements. At the election of the 

University, the employee may be given pay in lieu of notice. 

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Taylor was placed on paid leave for four weeks, and on May 1, 2008 her employment 

with the University officially ended. 

Nonretention is described in Regents’ Policy 04.07.100: 

The university may discontinue or not renew an existing 

employment relationship through nonretention. Nonretention 

does not reflect discredit on an employee. If notice of 

nonretention is required by university regulation, the notice 

will be in writing and will comply with university regulation 

adopted under this section. The university may not use 

[ ] nonretention to terminate tenured faculty. 6

In a form provided to employees who receive notice of nonretention, the University 

explained that “[w]ithout a request” the University “will not voluntarily disclose to 

[third] parties any performance or conduct related reasons for a nonretention or at-will 

termination, although the University will consider any such reasons with respect to future 

employment with the University.” 

In response to her nonretention, Taylor filed a grievance with the University 

arguing that because she was a for-cause employee, she was entitled to receive 

termination-for-cause proceedings. During the discovery process for this grievance 

proceeding Taylor learned the University had concerns about her performance. 

The University appointed attorney William Cotton as a hearing officer and 

argued that the University was permitted by its employment agreement, policies, and 

regulations to nonretain Taylor. Cotton concluded that “the University [was] correct that 

the Policies and Regulations allow[ed] the non-retention of non-tenured employees 

without a showing of cause.” Cotton then cancelled a previously scheduled evidentiary 

hearing and recommended that the “Chancellor uphold the University’s decision to nonretain Ms. Taylor.” Chancellor Brian Rogers adopted Cotton’s recommendation. Taylor 

6 REGENTS’ POLICY P04.07.100. 

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then appealed to University President Mark Hamilton, who affirmed the denial of 

Taylor’s grievance. 

Taylor filed an administrative appeal in the superior court in Fairbanks. 

The superior court ruled in Taylor’s favor. The court first noted that “[a]ppellate courts 

review an agency’s interpretation of its own regulations under the reasonable and not 

arbitrary standard. This deferential standard of review properly recognizes that the 

agency is best able to discern its intent in promulgating the regulation at issue.”7 Even 

given this deferential standard of review, the superior court found the University’s 

decision that employees like Taylor “are subject to nonretention at will” to be “an 

unreasonable interpretation of the [University’s] regulations” because it “renders ‘for 

cause’ employment rights meaningless.” The superior court explained: 

In short, performance or conduct related reasons for 

nonretention can be a discredit towards future University 

employment. The University is in fact using nonretention 

where discredit attaches. This suggests that nonretention is 

being misapplied. The policy contemplates nonretention 

being used only when it would not reflect discredit on an 

employee. Thus it cannot be applied in circumstances where 

discredit attaches. 

Additionally, the superior court found that Taylor, as a “for cause” 

employee, “had an interest in continued employment and was therefore protected by the 

Due Process Clauses of the United States and Alaska Constitutions. . . . Those due 

process rights included the right to a hearing before being terminated.” The superior 

court concluded that because the University wrongfully denied Taylor such a hearing, 

the University violated her due process rights. The court reversed Taylor’s nonretention 

The court cited Regulatory Comm’n of Alaska v. Tesoro Alaska Co., 178 

P.3d 1159, 1163 (Alaska 2008). 

-6- 6791 

7 
 

 

 

 

and awarded backpay of an amount to be determined after further briefing. The 

University petitioned for review and we granted that petition. 

B. Grimmett Facts And Proceedings 

The underlying facts of Grimmett’s case are largely undisputed. Grimmett 

was employed as a police officer with the University of Alaska Anchorage’s Police 

Department until October 2008. Although the record does not contain a copy of 

Grimmett’s employment contract, the University’s notice of nonretention to Grimmett 

references Regents’ Policy and University Regulation 04.07.100, and Grimmett does not 

contend that he was not subject to this policy and regulation under the terms of his 

employment. 

After receiving an anonymous complaint alleging that Grimmett wrote 

himself parking citations in order to park illegally without consequence, the University 

interviewed Grimmett about his use of “self-ticketing.”8

 Grimmett admitted that he selfticketed five or six times over the course of about two years. Upon receiving the 

complaint and Grimmett’s admission, the University decided to terminate Grimmett’s 

employment for cause and alternatively to nonretain Grimmett under University 

Regulation 04.09.040. 

Grimmett received notice of the University’s decision and subsequently 

notified the University of his intent to contest his for-cause termination. A few months 

8 Grimmett’s “self-ticketing” consisted of parking illegally and writing 

himself a ticket which he then placed on his vehicle windshield so that other police or 

traffic enforcement officers would not ticket the vehicle; after Grimmett returned to his 

illegally parked vehicle, he would destroy the ticket and avoid any consequences for 

illegally parking. 

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later, Grimmett notified the University that he also disputed his nonretention.9 The 

University appointed Cotton as a hearing officer, and both Grimmett and the University 

submitted briefing. With respect to Grimmett’s nonretention, Cotton found Grimmett’s 

challenge was not timely and, even if it had been, the nonretention was “substantively 

valid” and should be upheld. Regarding Grimmett’s for-cause termination, Cotton found 

“that on balance the University has proven by a preponderance of the evidence that there 

was just cause to justify termination.” University Chancellor Fran Ulmer adopted the 

9 There is a dispute between the parties regarding the timeliness of 

Grimmett’s appeal of his nonretention. The University issued both the notice of 

Grimmett’s nonretention and the notice of its intent to terminate his employment for 

cause on the same day. Grimmett timely requested a hearing to contest the for-cause 

termination, but — as he admitted to the hearing officer — did not timely challenge the 

nonretention. The hearing officer found that Grimmett’s appeal of the nonretention was 

untimely, but nevertheless addressed the substantive validity of the appeal, finding the 

nonretention was valid. On appeal, the superior court found that Grimmett waived his 

right to appeal his nonretention, but it nevertheless also addressed the substantive 

validity of the nonretention, finding that the University’s nonretention policy did not 

violate due process. In his appeal before us, Grimmett again challenges the nonretention, 

arguing that it violates due process. Although it is clear that Grimmett’s challenge to the 

nonretention was untimely, both the hearing officer and the superior court addressed the 

merits of Grimmett’s challenge, and both parties have had a full opportunity to be heard 

on this issue. We have stated that we are “not inclined to cut off rights of appellate 

review because of some failure on the part of a litigant to comply with the rules.” 

Orbeck v. Wheeler Constr. Co., 394 P.2d 781, 782-83 (Alaska 1964). In Cook v. Aurora 

Motors, Inc., 503 P.2d 1046, 1049 (Alaska 1972), we set forth the considerations that 

should be balanced in determining whether the rules should be relaxed. They are the 

right to appellate review, the willfulness and extent of the rules violation, and the 

possible injustice that might result from dismissal. Id. Given that Grimmett’s grievance 

was not filed inordinately late, that such lateness may have been due to confusion 

engendered by the University’s attempt to terminate Grimmett’s employment by the 

simultaneous use of two separate procedures, and that both the hearing officer and the 

superior court reached the merits of the nonretention, we will likewise address the merits 

here. 

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hearing officer’s findings and conclusions. Grimmett appealed this decision to the 

superior court in Anchorage. 

The superior court found: (1) the University’s nonretention policy did not 

violate Grimmett’s procedural or substantive due process rights; (2) Grimmett’s forcause termination was justified, as the University terminated him for serious violations 

of departmental policy; but (3) the University’s “decision to terminate Grimmett for 

cause was objectively unfair given the culture of disregard for parking rules in [the 

University of Alaska Anchorage Police Department].” Thus, the court found that “[t]he 

for cause termination of [Grimmett] is set aside,” but the “nonretention of [Grimmett] is 

upheld.” Grimmett appeals and the University cross-appeals. 

III. STANDARD OF REVIEW 

“In administrative appeals, we directly review the agency action in 

question.”10 

We review questions of fact under the “substantial evidence” test.11 

“Substantial evidence is ‘such relevant evidence as a reasonable mind might accept as 

adequate to support a conclusion.’ ”12 “We need only determine whether such evidence 

10 Fairbanks Fire Fighters Ass’n, Local 1324 v. City of Fairbanks, 48 P.3d 

1165, 1167 (Alaska 2002) (citing N. Alaska Envtl. Ctr. v. State, Dep’t of Natural Res., 

2 P.3d 629, 633 (Alaska 2000)). 

11 Handley v. State, Dep’t of Revenue, 838 P.2d 1231, 1233 (Alaska 1992). 

12 Id. (quoting Keiner v. City of Anchorage, 378 P.2d 406, 411 (Alaska 

1963)). 

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exists, and do not choose between competing inferences.”13 “We do not evaluate the 

strength of the evidence, but merely note its presence.”14 

We review questions of law where no agency expertise is involved under 

the “substitution of judgment” test.15 “The substitution of judgment standard thus applies 

where the agency’s expertise provides little guidance to the court or where the case 

concerns statutory interpretation or other analysis of legal relationships about which 

courts have specialized knowledge and expertise.”16 

Construction of employment contracts, including questions concerning the 

implied covenant of good faith and fair dealing when the material facts are not disputed, 

are reviewed de novo.17 

Questions of due process present constitutional issues that we review de 

18 novo.

13 Id. 

14 Id. 

15 Id. 

16 N. Alaska Envtl. Ctr. v. State, Dep’t of Natural Res., 2 P.3d 629, 633 

(Alaska 2000) (quoting Kelly v. Zamarello, 486 P.2d 906, 916 (Alaska 1971)) (internal 

quotation marks omitted). 

17 Luedtke v. Nabors Alaska Drilling, Inc., 834 P.2d 1220, 1223 (Alaska 

1992) (“Whether Luedtke’s suspension breached the covenant of good faith and fair 

dealing is a question for the trier of fact. Normally we review such questions only for 

clear error. However, we may review the application of a legal doctrine to undisputed 

facts without the usual deference to the superior court.” (quoting Foss Alaska Line, Inc. 

v. Northland Servs., 724 P.2d 523, 526 (Alaska 1986))) (internal citations and quotation 

marks omitted). 

18 James v. State, Dep’t of Corr., 260 P.3d 1046, 1050 (Alaska 2011). 

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IV. DISCUSSION 

A. Dismissing Taylor Without A Hearing Denied Her Due Process. 

1. Taylor was a for-cause employee. 

The University hired Taylor without tenure for a ten-month term.19 The 

University “designates employment not established as at-will to be for cause.”20 The 

University concedes that Taylor’s employment was never designated as at-will and that 

her employment was therefore “For Cause Employment” as described in University 

Regulation R04.01.050(B). The term “for-cause employment” is o ften used to denote 

employment that can be terminated only for cause, as opposed to at-will employment, 

which does not include such protections.21 Further, a public employee who can be 

terminated only for cause has a legitimate expectation of continued employment that, 

under both federal and Alaska constitutional law, gives rise to a property interest in her 

19 It is undisputed that the University had no obligation to renew Taylor’s 

contract at the end of her employment, and that Taylor would not be entitled to a hearing 

on a declination to renew. See Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 573 

(1972). 

20 UNIVERSITY REGULATION R04.01.050(B). 

21 See, e.g., Era Aviation, Inc. v. Seekins, 973 P.2d 1137, 1139 (Alaska 1999) 

(observing that “[o]ur cases have distinguished between at-will and for-cause 

employment based on the level of cause needed to terminate the employment 

relationship”); Ford v. Trendwest Resorts, Inc., 43 P.3d 1223, 1228 (Wash. 2002) 

(stating that “we are unwilling to abandon the long-standing distinction between at-will 

employment and for-cause employment”); Brooks v. Hilton Casinos Inc., 959 F.2d 757, 

771 (9th Cir. 1992) (describing “for cause employment” as “employment as long as [the 

employees] did their jobs properly”); see also Casey v. City of Fairbanks, 670 P.2d 1133, 

1138 (Alaska 1983) (stating that “persons who are employed other than ‘at will’. . . have 

a sufficient property interest in continuing their employment, absent just cause for their 

removal, to require that they be given notice and an opportunity to be heard under the 

due process clause of the Alaska Constitution (art. I, § 7) before their employment is 

terminated”). 

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job.22 Such a property interest is protected by the Due Process Clauses of both the 

United States and Alaska Constitutions.23 An essential principle of due process is that 

a deprivation of life, liberty, or property “be preceded by notice and opportunity for 

hearing appropriate to the nature of the case.”24 In employment termination cases in 

particular, due process requires“[a]t a minimum” that the employee “receive oral or 

written notice of the proposed discharge, an explanation of the employer’s evidence, and 

an opportunity to present his position.”25 

The University argues that although it identified Taylor’s employment as 

“for-cause employment,” Taylor was not entitled to due process prior to her termination.

 It argues that its “nonretention” clause should have put Taylor on notice that despite her 

“for-cause employment” status she, like an at-will employee, could be terminated 

without due process. 

We acknowledge that “the use of the words ‘for cause’ does not magically, 

or always, transform a job into protected property; the focus must remain upon the nature 

of the employee’s legitimate expectation of continued entitlement to his or her job.”26 

22 Chijide v. Maniilaq Ass’n of Kotzebue, Alaska, 972 P.2d 167, 171–72 

(Alaska 1999); City of North Pole v. Zabek, 934 P.2d 1292, 1297 (Alaska 1997). 

23 City of North Pole, 934 P.2d at 1297. 

24 Id. (quoting Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 542 

(1985)) (internal quotation marks omitted). 

25 Id. (quoting Storrs v. Municipality of Anchorage, 721 P.2d 1146, 1149 

(Alaska 1986)) (internal quotation marks omitted). In employment termination cases 

“we have consistently held that due process of law . . . requires a pre-termination 

hearing.” Id. (quoting Odum v. Univ. of Alaska, Anchorage, 845 P.2d 432, 434 (Alaska 

1993)) (internal quotation marks omitted). 

26 Bennett v. City of Boston, 869 F.2d 19, 21 (1st Cir. 1989). 

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Similarly, although — as noted above — the term “for-cause employment” typically 

denotes employment that can be terminated only for cause, this does not necessarily 

mean that an employer could not use the phrase “for-cause employment” in some other 

way. But if the employer seeks to use the term “for-cause employment” in an unusual 

and unexpected way, without the protections that are typically associated with “for-cause 

employment,” it must make this clear. As we explain below, Taylor’s employment 

contract, including the terms of the University’s nonretention clause, did not clearly 

indicate that the University intended Taylor’s “for-cause employment” to be subject to 

termination without due process. In other words, the University’s contract with Taylor 

established a legitimate expectation of continued employment and required the 

University to provide Taylor due process before terminating her. 

2. Nonretention may not be used for performance-based dismissals. 

The University’s policies and regulations provided that Taylor, as a forcause employee, was subject not only to “for cause termination” but also to termination 

“[i]n the event of layoff, non-retention, or financial exigency.”27 Similar provisions are 

often present in for-cause employment contracts, and courts “as a rule” have found “that 

layoffs resulting from a genuine need to reduce the work force or to eliminate certain 

positions should not be treated as violating a contractual obligation to terminate only for 

cause.”28 Such procedures may be used for genuine work-force-related needs and may 

not be used as “merely a pretext for termination.”29 

27 UNIVERSITY REGULATION R04.01.050(B)(2). 

28 STEVEN C. KAHN ET AL., LEGAL GUIDE TO HUMAN RESOURCES § 8.02[5] 

(1999). 

29 Id. 

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Consistent with these principles, the University’s policies and regulations 

provide detailed information about the circumstances under which “layoff” and 

“financial exigency” apply, ensuring that such procedures will be used only when there 

is a genuine need to reduce work force or eliminate certain positions. 30 By contrast, the 

policies and regulations provide little explanation of the circumstances under which the 

“nonretention” procedure may be used. Regents’ Policy 04.07.100 states that “[t]he 

university may discontinue or not renew an existing employment relationship through 

nonretention”31 but does not elaborate further on when nonretention may be used. 

Similarly, the associated regulations merely describe the procedures associated with 

nonretention.32 There is nothing in the policies or regulations to disturb the expectation 

established elsewhere that Taylor was a for-cause employee or to indicate that a for30 The Regulations specify that layoff may be used when there exists either 

“a lack of or reduction in available work; a lack of sufficient available funds; a good faith 

reorganization; or another reason, not reflecting discredit upon the affected 

employee(s).” UNIVERSITY REGULATION R04.07.110(A). Similarly, a “financial 

exigency” exists “when the board determines that a shortfall in projected revenues for 

general operations . . . will have a material adverse effect on the operation of the 

university generally, or on a major administrative unit or an academic or other unit of a 

major administrative unit.” REGENTS’ POLICY P04.09.020(A). 

31 The University’s definition of “nonretention” departs from the usual 

meaning of the term. In cases both from Alaska and other jurisdictions, “nonretention” 

is frequently found and almost always used to refer only to the power not to renew an 

employee’s contract at the end of her term, not the power to “discontinue” employment 

mid-term. See, e.g., Shatting v. Dillingham City Sch. Dist., 617 P.2d 9, 10 n.1 (Alaska 

1980) (observing that “Alaska’s statutory scheme recognizes a distinction between 

‘nonretention’ and ‘dismissal’ ” in the context of teacher employment, in which the 

former term means the election by an employer not to reemploy a teacher for the school 

year or school term immediately following the expiration of the teacher’s current 

contract). 

32 UNIVERSITY REGULATION R04.07.100. 

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cause employee may be terminated for any reason or no reason at all without due 

process. On the contrary, the context of the nonretention clause suggests that 

nonretention functions in a way similar to layoff and financial exigency and that, like 

those two procedures, nonretention is limited to reductions in force or similar nonperformance-related exigencies. 

In particular, we observe that the Regents’ Policy governing nonretention 

states that nonretention “does not reflect discredit on an employee.” 33 In this respect, 

nonretention is similar to a layoff, which according to University Regulation 04.07.110 

similarly “does not reflect discredit on the employee’s performance.” The University’s 

regulations ensure that a layoff “does not reflect discredit” on the employee by requiring 

that layoffs be used only for reasons “not reflecting discredit upon the affected 

employee(s),” such as reorganization or lack of funds.34 An employee would reasonably 

expect that the “non-discredit” clause in the nonretention procedure would function in 

a similar way as the “non-discredit” clause in the layoff procedure, and that accordingly 

nonretention could be used only for reasons “not reflecting discredit upon the affected 

employee,” such as reorganization or lack of funds. Dismissing an employee via 

nonretention apart from reasons like layoff, reduction in force, and financial exigency, 

especially where the employer is doing so for performance-based concerns, cannot help 

but raise questions in the minds of future potential employers, thus making it difficult if 

not impossible for the former employee to rebut the suspicion of discredit. In short, by 

the terms of Taylor’s contract and the University’s policies and regulations, the 

33 REGENTS’ POLICY P04.07.100. 

34 UNIVERSITY REGULATION R04.07.110. 

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University was permitted to use the nonretention procedure only for non-performancebased reasons.35 

3. Conclusion

 The University’s policies and regulations failed to make clear that it 

intended Taylor’s “for-cause employment” to be devoid of the protections that typically 

define “for-cause employment.” Taylor had a legitimate expectation that her “for-cause 

employment” would continue, and the University was required to provide Taylor due 

process when it sought to terminate her. Because the University’s nonretention policy 

could not be used to achieve a performance-based dismissal, the University was required 

to provide Taylor with the due process protections available to her as a for-cause 

employee. Accordingly, the University violated Taylor’s right to due process when it 

failed to provide her a pre-termination hearing. 

B. Grimmett’s Nonretention And For-Cause Termination 

Grimmett appeals the superior court’s decision upholding his nonretention 

termination, arguing that the University violated his due process rights when it 

nonretained him. The University appeals the superior court’s decision to set aside 

Grimmett’s for-cause termination, arguing that it did not breach the covenant of good 

faith and fair dealing. 

35 The rule that nonretention proceedings may not be used for performancebased dismissal is consistent with our previous encounters with non-discredit clauses. 

In both Stanfill v. City of Fairbanks, 659 P.2d 579, 582 (Alaska 1983) and Moore v. 

State, Dep’t of Transp. and Pub. Facilities, 875 P.2d 765, 770 (Alaska 1994), employers 

were faced with rules that stipulated that layoffs would not “reflect discredit upon the 

service of the employee.” In both cases, those rules provided that an employee could 

only be laid off for “reasons which are outside the employee’s control.” That is, they 

could only be terminated for issues unrelated to performance. 

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1.	 The University violated Grimmett’s due process rights when it 

nonretained him. 

The University terminated Grimmett’s employment through the same 

nonretention procedure discussed above in Taylor’s case. Like Taylor, Grimmett was 

a for-cause employee entitled to due process. Consequently, the University’s use of the 

nonretention procedure without giving Grimmett due process was a violation of his 

rights.36 

2.	 The University did not breach the objective prong of the 

covenant of good faith and fair dealing when it terminated 

Grimmett for cause. 

After a hearing on the University’s for-cause termination of Grimmett, the 

hearing officer determined that Grimmett had engaged in the practice of self-ticketing. 

The hearing officer found that other officers had at times self-ticketed as well. The 

hearing officer found “it blatantly obvious[] that the practice engaged in was wrong, was 

dishonest, and was in violation of . . . four University policies . . . .” Further, the hearing 

officer found that “the serious impropriety of the practice [was] exacerbated by the fact 

that it was committed by a University police officer charged with the enforcement of the 

law and University rules. Indeed, the officer used his official powers to commit the 

dishonest acts.” Finally, the hearing officer explained: 

[I]n addition to being obviously objectively improper, I 

conclude that the officers in question, despite certain 

statements to the contrary, recognized that their actions were 

wrong and in violation of University rules. Specifically, I 

find that Officer Grimmett, despite protestations to the 

contrary at the hearing, recognized that they would at least 

result in the serious discipline of suspension without pay. 

As we explain below in Part IV.B.3, because Grimmett’s nonretention took 

effect immediately, this violation of due process may not have been cured by the later 

for-cause termination proceedings. 

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The hearing officer concluded that the University had just cause to terminate Grimmett. 

The University Chancellor adopted the hearing officer’s findings and conclusions, and 

Grimmett appealed that decision to the superior court. 

The superior court affirmed the hearing officer’s conclusion that 

Grimmett’s termination was justified because Grimmett had committed a serious 

violation of University policy. The superior court found that “Grimmett clearly violated 

three of the UPD Policies cited by the University: misuse of authority, conduct 

unbecoming, and conformance with all laws.” However, the court went on to hold that 

“due to the ‘culture of disregard for parking rules in UPD,’ ” the University behaved in 

an objectively unfair manner when it fired Grimmett. The court explained that because 

Grimmett was not “on notice that his conduct could result in termination,” the University 

breached the covenant of good faith and fair dealing when it fired him. 

The University argues that the superior court erred in finding that the 

University breached the objective prong of the implied covenant of good faith and fair 

dealing and in finding that it treated Grimmett in an objectively unfair manner by 

terminating his employment for self-ticketing. Relying primarily on the findings of the 

hearing officer, Grimmett argues that because “UAA PD had created an atmosphere 

which would provide little to no notice that an officer could or would be terminated for 

self ticketing,” the University breached the covenant of good faith and fair dealing by 

terminating him for self-ticketing. Because the underlying facts of Grimmett’s case are 

undisputed, we review the application of law to those facts de novo.37 

At the administrative hearing, the hearing officer considered evidence and 

testimony that suggested an inconsistent attitude by the University with respect to officer 

Luedtke v. Nabors Alaska Drilling, Inc., 834 P.2d 1220, 1223 (Alaska 

1992). 

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parking. The hearing officer found, for example, that the chief occasionally voided 

tickets, that police officers did not write tickets on other police officers’ vehicles, and 

that there was no broad investigation into the practice of self-ticketing. However, the 

hearing officer also found that none of this evidence was relevant, as these practices were 

either officially sanctioned38 or were unknown to the chief. In contrast, Grimmett’s selfticketing was not sanctioned, and the police chief was made aware of Grimmett’s actions 

only after a letter of complaint and Grimmett’s admission. 

In Luedtke v. Nabors Alaska Drilling, Inc., we held that the covenant of 

good faith and fair dealing requires an employer “to act in a manner which a reasonable 

person would regard as fair” and “requires that the employer be objectively fair.”39 The 

superior court found that the University violated the Luedtke principle when it fired 

Grimmett; the court reasoned that the University’s casual attitude towards parking 

violations rendered termination for such a violation objectively unfair by failing to put 

Grimmett on notice that his behavior could result in termination. 

On appeal, the University argues that the superior court improperly 

extended Luedtke, and additionally that the University gave Grimmett the notice required 

by Luedtke because Grimmett was aware that self-ticketing could result in termination. 

Grimmett counters that even though official regulations and policies forbid self-ticketing, 

38 For example, the Parking Director once agreed to void parking tickets that 

several individuals received while parked at the University for an on-campus conference, 

but he followed University policies and procedures in doing so. 

39 834 P.2d at1224-25. “We have recognized a covenant of good faith and 

fair dealing in all at-will employment contracts.” Id. at 1223. In Luedtke, we held that 

an employer violated this covenant “as a matter of law” where “[t]he superior court 

found that Luedtke was tested for drug use without prior notice, that no other employee 

was similarly tested, and that Nabors suspended Luedtke immediately upon learning of 

the results of the test.” Id. at 1225-26. 

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the practice was common and sanctioned by lower-ranking members of the police 

department; therefore, it was unfair for the University to terminate his employment for 

self-ticketing. 

Luedtke holds that an employer violates the covenant of good faith and fair 

dealing if the employer fires an employee without notice or for some other reason that 

is objectively unfair.40 Given the deference due to the hearing officer’s findings of fact, 

the University’s argument that Grimmett had notice that his actions could result in 

termination and that Grimmett was not treated in an objectively unfair manner is 

persuasive. As explained by the hearing officer: 

Grimmett has clearly committed dishonest acts which violate 

important University policies. Further, he both should have 

known the nature of these acts and I have found [he] did in 

fact know the nature of his actions. However, his dishonesty 

was an attempt to defraud the University of no more than a 

few dollars of parking fees. He admitted his actions 

immediately on questioning by Chief Pittman. Further, he 

was following a practice which other officers had taken and 

had even been told by a superior that the actions were ok 

(although I have clearly found that this did not justify his 

[ ] actions). 41 Arguably, it would have been sufficient for 

Chief Pittman to suspend Grimmett without pay for a 

significant time rather than to terminate him. 

However, I conclude that on balance the University has 

proven by a preponderance of the evidence that there was just 

40 Id. at 1225-26. 

41 The hearing officer found that Annie Endecott, who was Grimmett’s direct 

supervisor from 2001 until early 2008, told Grimmett that self-ticketing was acceptable. 

However, Endecott was terminated/nonretained in early 2008, and Grimmett admitted 

that: (1) he knew self-ticketing was wrong; and (2) he knew he would need to be more 

careful with self-ticketing after Endecott left because he felt that the two other lieutenants 

for whom he worked would not approve of the practice. 

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cause to justify termination because dishonesty and misuse of 

a police officer’s authority violate critically important 

University policies, and indeed societal values. . . . The 

University in this case has sent a strong message that its 

Police Department will not tolerate dishonesty and misuse of 

authority. 

The hearing officer also found that Grimmett knew his actions violated university policy. 

The University’s Regents’ Policy 04.07.040, entitled “Corrective Action,” explains that 

dismissal is a possible corrective action in response to “violation of . . . regents’ policy[] 

or university regulation, dishonesty, . . . or other misconduct.”42 Given that Grimmett 

had notice through the University’s policies that his conduct was wrong and could result 

in termination, and that he actually knew his actions were wrong, we conclude Grimmett 

— a police officer charged with enforcing the law — was not treated in an objectively 

unfair manner when the University terminated him because of his unlawful and dishonest 

conduct. We reverse the superior court’s determination that the University violated the 

covenant of good faith and fair dealing and affirm the University hearing officer’s 

decision, which was adopted by the University chancellor, that the University’s for-cause 

termination was justified. 

3. Remand is required to determine Grimmett’s pay. 

On October 13, 2008, Grimmett received a letter notifying him of his 

nonretention. The letter stated that, per the terms of University Regulation 04.07.100, 

the University “has decided to provide you with four weeks pay in lieu of notice. 

Therefore, your non-retention will be effective today, October 13th, which will be 

reflected as your last day of employment. The four weeks pay in lieu of notice will be 

included in your final paycheck.” 

 P04.07.100. 

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On that same day, October 13, Grimmett also received a letter notifying him 

that the University intended to terminate his employment for cause. The letter stated 

that, per the terms of University Regulation 04.08.80, Grimmett had five working days 

to request a hearing and that a hearing would take place “no sooner than three working 

days after receipt of your request.” Grimmett’s attorney provided timely response to the 

letter and requested that the hearing “be scheduled for sometime in February/March 

2009.” Grimmett’s hearing occurred on March 24 and 25, 2009. Hearing Officer Cotton 

issued his recommended decision on June 10, 2009. The chancellor adopted the decision 

on June 24, 2009. According to University Regulation 04.08.80(B), governing 

“Termination of Pay” under for-cause termination proceedings, “Employees will 

normally remain in pay status until the decision of the chancellor . . . is made unless a 

prior proceeding affording minimum due process has been made available.” 

Grimmett was paid for a period ending approximately November 13, 2008, 

in accordance with his nonretention. We have determined the nonretention violated his 

due process rights. Under University Regulation 04.08.80(B), Grimmett arguably was 

entitled to remain in pay status until June 24, 2009, the date the chancellor issued the 

termination-for-cause order. Because no findings were made with respect to Grimmett’s 

pay, including whether a “prior proceeding affording minimum due process” was “made 

available” to Grimmett prior to the chancellor’s decision, and because the parties have 

not addressed this issue on appeal, we remand to the superior court for further 

proceedings. 

V. CONCLUSION 

For the foregoing reasons, we AFFIRM the superior court’s ruling that the 

University violated Taylor’s due process rights and REMAND for further proceedings 

concerning the scope of Taylor’s backpay remedy. We REVERSE the superior court’s 

upholding of Grimmett’s nonretention. We also REVERSE its ruling that the University 

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violated the covenant of good faith and fair dealing in its for-cause termination of 

Grimmett, and we AFFIRM the University chancellor’s decision upholding the 

University’s for-cause termination. We REMAND for further proceedings concerning 

Grimmett’s pay. 

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