Case Name: Jean BOUDAR, Plaintiff-Appellee, v. E.G. & G., INC., a foreign corporation, Defendant-Appellant, v. John BUENETTE, et al., Defendants-Appellees
Court: Supreme Court of New Mexico
Jurisdiction: New Mexico
Decision Date: 1987-08-27
Citations: 106 N.M. 279
Docket Number: No. 16167
Parties: Jean BOUDAR, Plaintiff-Appellee, v. E.G. & G., INC., a foreign corporation, Defendant-Appellant, v. John BUENETTE, et al., Defendants-Appellees.
Judges: SCARBOROUGH, C.J., and WALTERS and RANSOM, JJ., concur.
Reporter: New Mexico Reports
Volume: 106
Pages: 279–287

Head Matter:
742 P.2d 491
Jean BOUDAR, Plaintiff-Appellee, v. E.G. & G., INC., a foreign corporation, Defendant-Appellant, v. John BUENETTE, et al., Defendants-Appellees.
No. 16167.
Supreme Court of New Mexico.
Aug. 27, 1987.
Rehearing Denied Sept. 16, 1987.
Sutin, Thayer & Browne, Randy S. Bar-tell, Ron Segel, Santa Fe, for defendant-appellant.
Ortega & Snead, Michael Bustamante, Paskind, Lynch & Printz, Myra C. Lynch, Albuquerque, for plaintiff-appellee Boudar.

Opinion:
OPINION
SOSA, Senior Justice.
This matter is before us on rehearing. In our original opinion, Boudar v. E.G. & G., Inc., 105 N.M. 151, 730 P.2d 454 (1986), we reversed judgment in favor of Jean Boudar (Boudar) granted by the trial court sitting with a jury. In reversing, we found two errors: (1) the trial court should not have submitted to the jury Boudar's tort claim for wrongful discharge from his employment, and (2) the trial court should not have submitted to the jury Boudar's count alleging breach of contract of employment. On December 31, 1986, we denied Boudar's motion for rehearing. Then, however, after Boudar filed his motion for reconsideration of our denial of his motion for rehearing, we granted Boudar's motion for rehearing. After further consideration of the opinion filed on December 12, 1986, the pleadings of record, the original briefs on appeal, and the parties' briefs relevant to the motion for rehearing, we agree with Boudar that in our original opinion this Court misperceived certain aspects of the record and improvidently arrived at its decision. Accordingly, we withdraw the opinion filed on December 12, 1986 and substitute in its stead the following opinion, in which we affirm the trial court's judgment in its entirety.
Since our original opinion sets forth clearly the factual and procedural context out of which the appeal arose, we do not repeat such matters here.
THE ISSUE RAISED BY THE COURT OF APPEALS' PROSPECTIVE APPLICATION OF VIGIL V. ARZOLA
In our original opinion, we relied on the court of appeals' ruling in Vigil v. Arzola, 102 N.M. 682, 699 P.2d 613 (Ct.App.1983), rev'd on other grounds, 101 N.M. 687, 687 P.2d 1038 (1984), and in particular on that portion of the court of appeals' ruling in which the newly defined public policy exception to the termination-at-will rule was given "modified prospective application." Id. 102 N.M. at 690-91, 699 P.2d at 621-22. We thus ruled that "[ujnder the court of appeals' holding concerning prospectivity, the rule of Vigil is not applicable to this case. The rule which is applicable to this case is the terminable-at-will rule. " Boudar v. E.G. & G., Inc., 105 N.M. at 153, 730 P.2d at 456.
Upon reconsideration, we hold that the "modified prospective application" rule of Vigil v. Arzola was too narrowly defined. The court of appeals in Vigil ruled that only plaintiffs whose cases were filed after the date its decision became final were entitled to rely on the newly enunciated rule concerning the public policy exception to the terminable-at-will rule. In our judgment, plaintiffs asserting a cause of action based on the public policy exception should not be denied access to the courts on this issue simply because of the date on which their attorneys reach the courthouse with their clients' complaints. Hypothesize, for example, two plaintiffs with identical claims against their respective employers, both of whom raise well-pleaded causes of action based on the public policy exception. One client's attorney files the complaint the day before the ruling in Vigil became final, while the other client's attorney is dilatory in taking his pleadings to the courthouse, and thus files after the Vigil decision became final. Is either justice or logic served by denying the first plaintiff a day in court because his attorney was more diligent than the second attorney?
We feel that the modified prospective application of Vigil should be expanded as follows: For all cases filed on or before July 5, 1983, the date of the court of appeals' opinion, plaintiffs, counter-claimants or cross-claimants asserting in their pleadings of record a cause of action for retaliatory discharge which embodies the public policy exception, may rely on the Vigil rule in the prosecution of their actions, so long as trial of the case was not completed before July 5, 1983. Naturally, similar causes of action filed after July 5, 1983 may also be predicated on the Vigil ruling. To the extent that the court of appeals' decision as to modified prospective application differs from the position we have advanced above, that decision is overruled. Accordingly, since trial in the present case began in 1985, even though the complaint was filed in 1982, we hold that the trial court did not err in allowing the jury to consider the issue of Boudar's tort claim for wrongful discharge.
THE ISSUE RAISED BY BOUDAR'S CLAIM OF BREACH OF CONTRACT OF EMPLOYMENT
In reviewing the record below, we find that we too narrowly evaluated the substance and content of the pleadings when we ruled in the decision filed on December 12, 1986 that "the first count of plaintiff's amended complaint did not plead a claim of breach of contract of employment and E.G. & G. never consented to trial of a claim for breach of contract." Boudar v. E. G. & G., Inc., 105 N.M. at 153, 730 P.2d at 456. Closer scrutiny of the record reveals that Boudar explicitly raised the contract issue and that E.G. & G. was fully apprised of this issue before trial.
In Boudar's original complaint paragraph seven stated: "Under normal circumstances, as a matter of implied contract or oral agreement between the plaintiff and E.G. & G., plaintiff would have been entitled to remain in his employment with the defendant E.G. & G., Inc. throughout such time as his services and performance as a photo lab technician were satisfactory." In Boudar's amended complaint, paragraph seven was changed to read in pertinent part: "Under normal circumstances, as a matter of express contract, implied contract or oral agreement [then repeating the words in the original paragraph seven]" In E.G. & G.'s sixth affirmative defense to the amended complaint, it denied that Boudar had a contract of employment with E.G. & G. The conclusion is inescapable that E.G. & G. had thus been put on notice as to Boudar's allegation of breach of express and implied contract. Further, in E.G. & G.'s memorandum in support of its motion for partial summary judgment, it denies that two individual defendants interfered with Boudar's "contractual rights," speaks of another individual defendant's denying that Boudar had an "express contract," and concludes by saying: "Even if the Court believes that a question of fact exists as to whether plaintiff had a contract of employment, the record is undisputed that [certain individual] defendants cannot be liable for interference with contract."
The record clearly shows that Boudar properly pleaded a cause of action based on breach of contract, that E.G. & G. was put on notice as to this cause of action, and that the trial court properly allowed the jury to consider Boudar's contract claim. Any technical insufficiencies in Boudar's pleadings were overcome by the substantive content of the allegations raised therein, and the trial court thus correctly construed the pleadings so as to do substantial justice. Morrison v. Wyrsch, 93 N.M. 556, 603 P.2d 295 (1979); Wendenburg v. Allen Roofing Co., 104 N.M. 231, 719 P.2d 809 (1986).
ISSUES RAISED BY BOUDAR'S MOTION FOR REHEARING
E.G. & G. argues that we improperly granted Boudar's motion for rehearing, particularly because we had already denied Boudar's similar motion on December 31, 1986. Boudar's response to our first denial was to file a motion for reconsideration fourteen days after we had denied his original motion for rehearing, seeking another determination of the issues he had raised on appeal.
E.G. & G. argues that our granting of Boudar's motion for reconsideration will open the floodgates of endless post-appeal motions, so that litigants, and the bench and bar in general, will never be able to assure themselves that a case has been finally resolved. We acknowledge the wisdom of E.G. & G.'s argument, but we cannot allow the possibility of the future abuse of the procedure permitted here to deny justice to a party who has properly pursued his rights in the courts. Our deci sions must be final because they are right, and not right because they are final, even if we must take the untoward action of acknowledging our incorrect limitation of the issues presented to us on previous rehearing.
In Central Adjustment Bureau, Inc. v. Thevenet, 101 N.M. 612, 686 P.2d 954 (1984), we likewise admitted our oversight in a case in which we had made a decision that we considered final. There we held: "It cannot be questioned that, upon the [Supreme] Court's own motion or upon motion of any of the parties, the Court may recall its mandate [in order] to correct or clarify a matter inadvertently overlooked." Id. at 614, 686 P.2d at 956 (citations omitted). Here, whether through "inadvertance" as in Central Adjustment Bureau, Inc. v. Thevenet, or because we have "overlooked or misapprehended" points of law or fact, as in SCRA 1986, Section 12-404, we must not allow procedural considerations to diminish the obligation we have to hasten a case toward a conclusion based on substantial justice. We note also that Section 12-404 states that a motion for rehearing may be filed "within fifteen (15) days after filing of the appellate court's disposition, or any subsequent modification of its disposition. " (Emphasis added.) § 12-404. Boudar's motion for reconsideration of our initial denial of his motion for rehearing can properly be considered a motion filed after a subsequent modification of our original denial.
DISPOSAL OF SUBSTANTIVE ISSUES RAISED ON ORIGINAL APPEAL
E.G. & G. argues that even if we were to grant Boudar's motion for rehearing, Boudar would nonetheless not be entitled to the recovery granted him by the court below, and thus E.G. & G. urges us to uphold the reversal mandated by our original decision rendered on December 12, 1986. E.G. & G.'s argument is largely vitiated by our decision above concerning our reading of Vigil's holding as to modified prospectivity. Nonetheless, E.G. & G.'s argument meritoriously raises the issue of our continuing construction of the terminable-at-will rule, and thus calls for our further analysis of that rule here.
The terminable-at-will rule is undergoing considerable erosion in the various states, whether by legislative fiat or judicial reconsideration. Today, some thirty-nine states have modified the at-will rule by creating exceptions to its operation. Mallor, Punitive Damages for Wrongful Discharge of At Will Employees, 26 Wm. & Mary L.Rev. 449, 452 (1985). Some commentators are urging complete abandonment of the at-will rule, arguing that in the present industrialized economy the at-will rule no longer serves the purpose it once did. See note Protecting At-Will Employees Against Wrongful Discharge: The Duty to Terminate Only in Good Faith, 93 Harv.L.Rev. 1816 (1980). Indeed, "contrary to early American cases suggesting that the doctrine had its roots in historic Anglo-Saxon law, the at-will doctrine was in fact a departure from the common law of England. In eighteenth century England, the hiring of a menial servant was presumed to be yearly. Indeed, from the English Statute of Labourers in the fourteenth century until its repeal in the middle eighteenth century, the master could not discharge his servant except for 'reasonable cause.' " Mauk, Wrongful Discharge: The Erosion of 100 Years of Employer Privilege, 21 Idaho L.Rev. 201, 203 (1985).
The courts of this country have given considerable thought to whether exceptions to the at-will rule should sound in contract or tort. In New Mexico the court of appeals in Vigil determined that the public policy exception sounds in tort, the specific tort being defined as retaliatory discharge. In our partial reversal of Vigil, we held that whether the plaintiff was entitled to recover — on grounds that the defendant's personnel manual set forth contractual procedures for termination — was a legitimate question of fact to be considered at trial. We thus remanded the case for a new trial on the count asserting breach of contract. Vigil v. Arzola, 101 N.M. 687, 687 P.2d 1038 (1984).
E.G. & G. argues that we have yet to hold that an employer's personnel man ual or employee handbook constitutes a contract for any other purpose than determining whether an employee was terminated in violation of an employer's stated procedure for termination, relying on Forrester v. Parker, 93 N.M. 781, 606 P.2d 191 (1980), and Hernandez v. Home Educ. Livelihood Program, 98 N.M. 125, 645 P.2d 1381 (Ct.App.) cert. denied, 98 N.M. 336, 648 P.2d 794 (1982). While Forrester v. Parker did deal with a factual situation in which an employer did not adhere to certain procedural requirements spelled out in the employer's personnel guide, we stated nonetheless, "[T]he guide constituted an implied employment contract; the conditions and procedures provided in it bound both Forrester and Parker. The words and conduct of the parties here gave rise to this implied contract." Id. 93 N.M. at 782, 606 P.2d at 192 (citations omitted). In Hernandez v. Home Educ. Livelihood Program, a case likewise based on a personnel policy guide's procedure as to termination, the court of appeals in construing Forrester correctly stated, "[T]he Supreme Court has held that a personal [sic] policy guide may constitute an implied employment contract." Id. 98 N.M. at 128, 645 P.2d at 1384. Neither Forrester nor Hernandez precludes a plaintiff such as Boudar from relying on a personnel policy guide in establishing the substantive basis of the entire contractual relationship with his employer, rather than relying on such a guide simply as a means to assess his employer's procedure as to termination. Thus the trial court here correctly permitted the jury to consider whether E.G. & G.'s personnel manual was the substantive contract formalizing the parties' understanding as to Boudar's employment.
Further, contrary to E.G. & G.'s argument, nothing prevented Boudar from proceeding on a mixed theory of recovery based on tort (retaliatory discharge) as defined in Vigil, 102 N.M. 682, 699 P.2d 613, and contract, as defined in Forrester and reaffirmed in Vigil v. Arzola, 101 N.M. 687, 687 P.2d 1038. We recently considered two further retaliatory discharge cases, Sanchez v. The New Mexican, 106 N.M. 76, 738 P.2d 1321 (1987), and Silva v. Albuquerque Assembly & Distribution Freeport Warehouse Corp., 106 N.M. 19, 738 P.2d 513 (1987). In Sanchez v. The New Mexican, we held that the employee handbook in question did not constitute a contract of employment because the language in the handbook was "of a nonpromissory nature and merely a declaration of defendant's general approach to the subject matter discussed." Id. 106 N.M. at 79, 738 P.2d at 1324. In Silva v. Albuquerque Assembly & Distribution Free-port Warehouse Corp., we held that the tort of retaliatory discharge is unnecessary and inapplicable if an employee is protected from wrongful discharge by an employment contract. Neither case, however, prevents a complainant such as Boudar here from alleging and presenting evidence on a claim sounding in both tort and contract.
The record before us provides ample justification for the trial court to have submitted to the jury both the issue of breach of employment contract and the issue of retaliatory discharge. Further, there is ample justification for the trial court to have submitted the issue of punitive damages to the jury, as punitive damages are allowable in a breach of contract case as well as in a tort case, Hood v. Fulkerson, 102 N.M. 677, 699 P.2d 608 (1985). Boudar based his claim for punitive damages on allegations of E.G. & G.'s bad faith during the course of his employment and in the manner and method used to terminate him. Bad faith will support an award for punitive damages. Gonzales v. Sansoy, 103 N.M. 127, 703 P.2d 904 (Ct.App.1984); NMSA 1978, UJI Civ. 13-1827 (Repl.Pamp. 1986). Thus the trial court did not err in submitting the issue of punitive damages to the jury.
Accordingly, we withdraw our opinion in Boudar v. E.G. & G., filed on December 12, 1986 and affirm the trial court's judgment on the verdict.
IT IS SO ORDERED.
SCARBOROUGH, C.J., and WALTERS and RANSOM, JJ., concur.
STOWERS, J., dissents.
. For some unknown reason, although the court of appeals' decision predated our own, our opinion made it into the reporter system first, thence accounting for the anomalous situation in which an earlier case appears in volume 102 of New Mexico Reports and a later case, partially reversing the earlier one, appears in volume 101.
. For a discussion of the legal theories which might support future causes of action brought in our state for wrongful discharge based on breach of contract, see note Employee Handbooks and Employment-at-Will Contracts, 1985 Duke L.J. 196, 212-19; Annot., 12 A.L.R.4th 544 (1982).