Opinion ID: 1490250
Heading Depth: 1
Heading Rank: 5

Heading: Circumstances of the Cessation of Mr. Teter's Employment

Text: As a preliminary issue, RPS argues that the lower courts erred in finding that RPS discharged Mr. Teter, thus triggering the severance pay provision of the 1997 employment agreement. Instead, RPS claims that Mr. Teter left the company voluntarily. The trial court found that RPS's actions amounted to a constructive discharge; the Court of Appeals found that RPS had actually discharged Mr. Teter. The Court of Appeals explained that RPS told the plaintiff, without equivocation, that his employment, as memorialized by his contract, was to be no more. (Emphasis in original.) The facts regarding the termination of Mr. Teter's employment are not disputed; the dispute is whether those facts constitute a voluntary or involuntary termination. Because the facts are not in dispute, the issue is amenable to resolution on motion for summary judgment. For the reasons stated below, we agree with the Court of Appeals that Mr. Teter's employment with RPS was involuntarily terminated, thus triggering the severance pay provision. Mr. Teter signed an employment contract with RPS effective January 1, 1997. This contract did not have an expiration date, but was for an indefinite period of time. On August 10, 2001, Mr. Huth presented Mr. Teter with a proposed new employment contract. The reason for the new contract was not due to the expiration of the prior contract, but was due to the company's desire to restructure the division in which Mr. Teter worked. Thus, during the time that RPS was attempting to renegotiate Mr. Teter's contract, Mr. Teter was still working under the 1997 contract, which remained in effect. RPS and Mr. Teter were unable to reach an agreement regarding a new contract because all the proposals contained terms less favorable to Mr. Teter. On September 11, 2001, Mr. Berry wrote a letter to Mr. Teter, expressing his disappointment that they could not reach a mutually acceptable agreement for [his] continued employment with RPS and suggested that it was time for them to part company and get on with life. Mr. Berry's deposition testimony clarifies further that Mr. Teter's employment was being terminated by the company: Question: And unless [Eric Teter] would accept the new contract, he did not have an option of remaining with your company under the old contract, did he? Answer: No. The evidence is unequivocal that if Mr. Teter did not agree to a new, modified contract, he would be terminated. The evidence is also clear that Mr. Teter did not agree to a new contract. Modification of an existing contract cannot be accomplished by the unilateral action of one of the parties. There must be the same mutuality of assent and meeting of minds as required to make a contract. New negotiations cannot affect a completed contract unless they result in a new agreement. Balderacchi v. Ruth, 36 Tenn.App. 421, 256 S.W.2d 390, 391 (1952) (citing Neilson & Kittle Canning Co. v. F.G. Lowe & Co., 149 Tenn. 561, 260 S.W. 142, 143 (1924)); see also Harber v. Leader Fed. Bank for Sav., 159 S.W.3d 545, 552 (Tenn.Ct.App. 2004). Therefore, because Mr. Teter did not agree to modify his existing contract and RPS would not continue to employ him under the old contract, RPS terminated Mr. Teter's employment, and Mr. Teter did not voluntarily resign his position.