Court Opinion

ID: 3016403
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:15:32.031388+00
Date Added: 2024-06-11T15:03:19.436774
License: Public Domain

___________

                                    No. 95-2660
                                    ___________

Judy L. Fox,                             *
                                         *
            Appellee,                    *
                                         * Appeal from the United States
     v.                                  * District Court for the District
                                         * of Minnesota.
T-H Continental Limited                  *
Partnership,                             *
                                         *
            Appellant.                   *
                                    ___________

                     Submitted:     December 11, 1995

                          Filed:    March 14, 1996
                                    ___________

Before BOWMAN and LOKEN, Circuit Judges, and SCHWARZER,* District Judge.

                                    ___________

BOWMAN, Circuit Judge.

     This   case   involves   the   doctrine   of   promissory   estoppel.   The
controlling substantive law is that of Minnesota.         Judy L. Fox sued her
former employer, T-H Continental Limited Partnership, after she was
terminated from her position as director of sales at the Mall of America
Days Inn in Bloomington, Minnesota.        Her complaint against T-H asserted
claims of sex discrimination, age discrimination, breach of contract, and
promissory estoppel.     The District Court granted summary judgment in favor
of T-H on the sex and age discrimination claims, but denied summary
judgment on the breach of contract and promissory estoppel claims.           The
case then proceeded to trial on the latter claims.       The jury found for T-H
on

     *The HONORABLE WILLIAM W. SCHWARZER, United States
     District Judge for the Northern District of California,
     sitting by designation.
Fox's breach of contract claim, but found that Fox was entitled to prevail
on her promissory estoppel claim, and returned a verdict in her favor of
$46,527.00, to which the District Court added prejudgment interest.       The
court denied T-H's post-judgment motion for judgment as a matter of law or,
alternatively, for a new trial or to amend the judgment.         T-H timely
appeals, claiming that the District Court erred in denying its motion for
judgment as a matter of law.     We agree with T-H and now reverse.   We hold
that Fox failed to make a submissible case on her promissory estoppel claim
and therefore that T-H's motion for judgment as a matter of law should have
been granted.

                                      I.

      Fox began working for Tollman-Hundley Hotels1 in 1989.          She was
promoted several times and, by early 1992, was general manager of a hotel
in Denver, Colorado.     In February 1992, after Tollman-Hundley sold the
hotel where Fox was employed, she was told that her job soon would be
terminated.   During the next two weeks, Fox was involved in tying up loose
ends in the hotel transfer when she was contacted by Tom Wilson, T-H's
vice-president for sales and marketing.     Wilson asked Fox to join T-H as
temporary director of sales at the Mall of America Days Inn.      Under the
terms of this interim employment agreement, Fox would receive a base salary
plus commissions on rooms booked by her sales department.      In addition,
because the position was only temporary, T-H would allow Fox to live in the
hotel, to rent a car as needed, and to be reimbursed for weekend trips back
to Colorado every three weeks.    Fox was told that permanent employment was
conditioned on her satisfactory performance in the temporary position and
a successful interview with the new general manager who had not yet been
hired.    Fox accepted the temporary position and began her new job on March
15,

      1
     According to appellant, Tollman-Hundley Hotels is "a company
separate, but related to T-H." Appellant's Br. at 1.

                                      -2-
1992.    She worked as a temporary employee for the next three and one-half
months.    Paul Hitselberger was eventually hired as the new general manager
and he offered Fox a permanent position as director of sales in June 1992.

        The terms of Fox's permanent employment were negotiated over a period
of months.      In a June 30, 1992 memorandum, Hitselberger detailed the terms
of T-H's offer of permanent employment.                     Under this offer, Fox's base
salary and commission formula were to remain the same as her temporary
position.       But, because this was a permanent position, T-H told Fox that
she     would   have   to    obtain      her    own     housing,    provide    her     own    local
transportation,        and    pay    for    all    personal    travel     back    to    Colorado.
Hitselberger explicitly stated in the memorandum that this was a "permanent
position" and that he hoped Fox would "commit to a long term position."
Memorandum from Hitselberger to Fox (June 30, 1992), at 1, 2.                         Fox was told
that "with no real stretch, there is in excess of $18,000 in available
commissions waiting to be earned," and, because the hotel was a "high
profile    property,"        Fox    would   have      an   opportunity    to     do    well   "both
financially and professionally, by turning [the hotel] around."                         Id. at 2.
Although Hitselberger expressed his enthusiasm for a successful employment
relationship with Fox, the memorandum contained no provisions on job
security and there was no promise of continued employment terminable only
for cause.

        In late summer, Fox advised Hitselberger that she would accept the
permanent position, but the issue of reimbursement of moving expenses
remained     unresolved.           Fox   and    Hitselberger       had   several      discussions
throughout the late summer concerning payment of relocation expenses.
During these discussions, Hitselberger learned that Fox was considering
other employment opportunities.                He told Fox to stop pursuing these other
employment opportunities.           Hitselberger apparently was concerned that Fox
would move to Minnesota at T-H's expense and then accept employment
elsewhere.      Consequently, Hitselberger advised Fox that T-H would pay for
the

                                                  -3-
moving expenses only if Fox made a written commitment to stay in the
director of sales position at least three months after relocation or repay
the moving expenses if she left within three months of her move.        On
October 7, 1992, Fox executed a written unilateral agreement committing to
these terms:

     This will confirm my intention to remain with Tollman-Hundley
     Hotels for a minimum of three months from the date of my move.

     I realize that the company is going to considerable expense to
     pay my moving expenses and I agree to reimburse them for these
     expenses should I leave prior to three months after I move or
     if I am terminated due to theft or dishonesty.

     It is certainly my intention to remain with the company for
     much longer than the above three months. I have enjoyed being
     employed by Tollman-Hundley for over three years and am looking
     forward to a continued long term relationship.

     /s/ Judy Fox

Memorandum from Fox to Hitselberger (Oct. 7, 1992), at 1.

     No one at T-H made any representations as to the duration of Fox's
continued employment.    In fact, at the time Fox executed this unilateral
agreement, she asked Hitselberger whether he would guarantee her three
months of employment.      Undisputed trial testimony revealed that the
following conversation occurred between Fox and Hitselberger:

     She said, "Will you guarantee me three months?" And I said, "I
     can't guarantee you any time at all you know that." And then
     she laughed and said, "Well, it was worth a try."

Trans. Vol. II at 251.

                                    -4-
      While serving as director of sales, Fox and her department exceeded
budgeted sales targets in nearly all categories.       She also successfully
negotiated a lucrative contract with United Airlines for flight crew rooms.
If she had not been terminated, Fox would have received substantial
commissions from the United contract.     Despite the fact that Fox exceeded
her   sales targets in many areas, T-H maintains that she "exhibited
persistent performance problems and unprofessional behavior."    Appellant's
Br. at 5.   On many occasions, Ms. Fox failed to follow up on outside sales
call reports brought in by her sales staff.        The hotel was plagued by
overbookings and improper utilization of the group rooms control log, which
was designed to curtail this problem.2    Hotel management also felt that Fox
did not manage or motivate junior members of the sales staff adequately.
Indeed, Fox's sales staff complained to hotel management about mistreatment
by Fox as well as her unprofessional behavior in front of customers.      In
addition, Fox failed to submit accurate, legible, and timely reports in
accordance with hotel requirements.        Fox even admitted that she was
counseled by her supervisors on several occasions about these problems and
received written admonitions on at least two occasions.    Trans. Vol. II at
62-63, 66-70, 73; Memorandum from Hitselberger to Fox (Sept. 22, 1992), at
1 (first written warning); Memorandum from Miley to Fox (Nov. 30, 1992),
at 1 (second written warning).   T-H terminated Fox's employment on December
11, 1992.   This lawsuit was filed a short time later.

                                    II.

      We review de novo the denial of a motion for judgment as a matter of
law, applying the same standards as the district court.     National Farmers
Union Standard Ins. Co. v. Souris River Tel.

      2
      If an overbooking occurs, T-H must turn customers away from
the Days Inn and "walk" them to a competitor hotel where they are
put up at T-H's expense.

                                    -5-
Mutual Aid Coop., Nos. 94-3777, 95-1087, 95-1214, slip op. at 8 (8th Cir.
Jan. 31, 1996).   A motion for judgment as a matter of law presents a legal
question to the district court, in the first instance, and to this Court
on   review: "whether there is sufficient evidence to support a jury
verdict."   White v. Pence, 961 F.2d 776, 779 (8th Cir. 1992).    Judgment as
a matter of law is proper when the nonmoving party has not offered
sufficient evidence "to support a jury verdict in his or her favor."
Abbott v. City of Crocker, 30 F.3d 994, 997 (8th Cir. 1994).     In making our
determination, we view the evidence in the light most favorable to the
nonmoving party, giving that party the benefit of all favorable inferences
that reasonably can be drawn from the evidence.     Id.   This Court will not
set aside a jury's verdict lightly, Nicks v. Missouri, 67 F.3d 699, 704
(8th cir. 1995), nor will we "engage in a weighing or evaluation of the
evidence or consider questions of credibility,"    Keenan v. Computer Assocs.
Int'l, Inc., 13 F.3d 1266, 1268-69 (8th Cir. 1994).       We conclude that Fox
failed to present sufficient evidence at trial to withstand T-H's motion.

      In Minnesota, the "usual employer-employee relationship is terminable
at the will of either" party.      Cederstrand v. Lutheran Bhd., 117 N.W.2d
213, 221 (Minn. 1962).   This means that the employer can summarily dismiss
an employee for any reason or no reason at all, and similarly the employee
is under no obligation to remain on the job.    Corum v. Farm Credit Servs.,
628 F. Supp. 707, 712 (D. Minn. 1986).     There is a "strong presumption" of
at-will status in Minnesota.    Spanier v. TCF Bank Sav., 495 N.W.2d 18, 21
(Minn. Ct. App. 1993).

      Relying on the doctrine of promissory estoppel, Fox argues that her
employment with T-H was not at will, but instead was "permanent" and
terminable only for cause.    Promissory estoppel is an equitable remedy that
"may be used to enforce a promise of employment where no express contract
of employment exists."       Eklund v. Vincent Brass and Aluminum Co., 351
N.W.2d 371, 378 (Minn. Ct.

                                     -6-
App. 1984) (citing Grouse v. Group Health Plan, Inc., 306 N.W.2d 114, 116
(Minn. 1981)).     To prevail on a claim of promissory estoppel under
Minnesota law an employee must show three things: (1) that the employer
made a clear and definite promise to the employee; (2) that the employer
intended to induce the employee to rely on the promise and that the
employee did so rely; and (3) that an injustice will occur unless the
promise is enforced.    See Ruud v. Great Plains Supply, Inc., 526 N.W.2d
369, 372 (Minn. 1995) (citing Cohen v. Cowles Media Co., 479 N.W.2d 387,
391 (Minn. 1992)).     In this case, the first element of a promissory
estoppel claim is entirely absent.   Fox produced no evidence that T-H made
a clear and definite promise of continued employment terminable only for
cause.   Her evidence thus was insufficient as a matter of law to overcome
Minnesota's strong presumption of at-will employment, and T-H therefore was
entitled to judgment as a matter of law.

     Fox argues that the conduct of the parties shows that T-H made a
clear and definite promise to her.    Appellee's Br. at 18.    She points to
her successful three-year history with Tollman-Hundley Hotels in Denver and
her successful completion of a three-and-one-half-month probationary period
as temporary director of sales in Minnesota.   Id. at 18-19.   Fox fails to
explain, however, how these events supply evidence that T-H made a clear
and definite promise to her of continued employment terminable only for
cause.   "A long term of service and good performance review do not, by
themselves, justify an implied contract term for continued employment."
Corum, 628 F. Supp. at 715; see also Dumas v. Kessler & Maguire Funeral
Home, Inc., 380 N.W.2d 544, 546 (Minn. Ct. App. 1986).    Fox's successful
past performance thus is not evidence of a clear and definite promise of
continued employment terminable only for cause.

     Fox also points to a number of statements made by T-H, claiming that
these representations are clear and definite enough to support her claim
of promissory estoppel.   She draws our

                                     -7-
attention to the fact that Hitselberger characterized the director of sales
position as "permanent."        This statement does not constitute a clear and
definite promise of continued employment terminable only for cause.               It has
long been the law of Minnesota that an employer's use of the terms
"permanent employment," "life employment," or employment "as long as the
employee chooses" creates only an indefinite general hiring terminable at
the will of either party.       Skagerberg v. Blandin Paper Co., 266 N.W. 872,
874 (Minn. 1936); accord Pine River State Bank v. Mettille, 333 N.W.2d 622,
627 (Minn. 1983); Harris v. Mardan Business Systems, Inc., 421 N.W.2d 350,
354   (Minn.   Ct.    App.   1988).     We    think   it   is   abundantly   clear   that
Hitselberger simply used the word "permanent" to draw a distinction between
Fox's initial three-and-one-half-month temporary position and his later
offer of employment which was "steady or continuing although nevertheless
terminable at will,"         Friedman v. BRW, Inc., 40 F.3d 293, 296 (8th Cir.
1994) (quoting Pine River, 333 N.W.2d at 628-29)).

      Likewise, Hitselberger's statements that the position would be "long
term" and that Fox "would be part of the turnaround of the hotel" and that
she could do very well for herself do not constitute clear and definite
promises for continued employment terminable only for cause.                 See Aberman
v. Malden Mills Indus., Inc., 414 N.W.2d 769, 771 (Minn. Ct. App. 1987)
(holding "general statements of company policy are not definite enough").
Indeed, "[e]very utterance of an employer does not constitute an offer."
Corum, 628 F. Supp. at 713 (citing Pine River, 333 N.W.2d at 630).
Minnesota courts have found many statements that are more clear and
definite than those made by Hitselberger to be insufficient to support a
claim of promissory estoppel.         For example, statements made by an employer
that "I will always take care of you," "we are offering you security," and
"[you will be a] lifetime sales representative" were not sufficiently clear
and definite.        Aberman, 414 N.W.2d at 771-72 (alteration in original).
Similarly, the Minnesota Supreme Court held that an employer's telling his

                                             -8-
employee to "stay with the ship" and consider his employment a "career
situation" were insufficient to show a clear and definite promise.          Degen
v. Investors Diversified Servs., Inc., 110 N.W.2d 863, 865-66 (Minn. 1961);
see also Corum, 628 F. Supp. at 714 (stating employee would have "job
security" did not constitute clear and definite promise); Ruud, 526 N.W.2d
at 371-72 (finding statement "good employees are taken care of" was not
clear and definite promise); Dumas, 380 N.W.2d at 548 (finding statement
that employer and employee would "retire together" was not clear and
definite promise).

        Fox attempts to distinguish Ruud, but otherwise does not even attempt
to distinguish this line of cases.          Instead, she relies on Rognlien v.
Carter, 443 N.W.2d 217 (Minn. Ct. App. 1989), and Grouse, 306 N.W.2d at
116, two cases in which Minnesota appellate courts reversed the dismissal
of promissory estoppel claims.         Rognlien and Grouse, however, are easily
distinguishable from the present case.          In Rognlien, the Minnesota Court
of Appeals reversed the summary dismissal of the plaintiff's promissory
estoppel claim because "the employer had made a sufficiently clear and
definite    promise   of   long-term   employment   that   summary   dismissal   of
plaintiff's breach-of-contract claim was reversed as well."          Friedman, 40
F.3d at 297 (discussing Rognlien).       Specifically, the employer in Rognlien
allegedly had assured the plaintiff that he "would not have to worry about
his job so long as he did good work."          Rognlien, 443 N.W.2d at 219.      The
Minnesota Court of Appeals held that the employer's statements would permit
a jury to find that the employer had made "an offer of employment subject
to dismissal only for good cause."       Id.   Thus, the court concluded that the
plaintiff should be allowed to go forward on his unilateral contract claim
and, as an alternative theory of recovery, also on his promissory estoppel
claim.    In the present case, however, there is no evidence that anyone ever
told Fox that her employment by T-H would continue as along as she did good
work.    Hence, unlike the plaintiff in Rognlien, Fox has failed to create

                                         -9-
a genuine issue of fact as to whether her employer made a sufficiently
clear and definite offer of continued employment subject to dismissal only
for good cause.    Furthermore, the employer in Rognlien made statements
assuring the employee about job security in response to the employee's
expressed desire to secure long-term employment.      In contrast, when Fox
inquired whether her employment would be guaranteed for any minimum amount
of time, Hitselberger's answer was that he could not guarantee her any time
at all.   For these reasons, Rognlien is inapposite.

     Fox's reliance on Grouse also is misplaced.    Grouse does not analyze
the "clear and definite promise" component of a promissory estoppel claim.
It focuses instead on the detrimental reliance element, which in this case
we need not and do not reach.

     On the other hand, the facts of Friedman v. BRW, Inc., another case
governed by Minnesota law, are similar to the facts in this case.         In
Friedman, the plaintiff, having been fired, sued his former employer, BRW,
Inc., on a promissory estoppel theory.      We affirmed the district court's
grant of summary judgment dismissing Friedman's complaint, concluding that
BRW never made "a clear and definite promise of long-term employment
terminable only for cause."   Friedman, 40 F.3d at 297.   Like Fox, Friedman
moved from another state to Minnesota to accept a salaried position.    Like
Fox, Friedman did not receive any specific promise as to the duration of
his employment.     Like Fox, Friedman was told that the position was
"permanent."   Id. at 295.   We fail to see any legally relevant differences
between Friedman and this case.3     Fox has failed to show that T-H made a
clear and definite promise of

     3
      Shortly after Friedman began work, BRW told him that his job
was a "regular" as opposed to a "permanent" position. Although Fox
attempts to distinguish Friedman on this basis, we find her
argument unpersuasive. Describing a position as "permanent" does
no more to take it out of the at-will category than does describing
it as "regular." See, e.g., Pine River State Bank v. Mettille, 333
N.W.2d 622, 627 (Minn. 1983).

                                     -10-
continued employment terminable only for cause.     Without proof of such a
promise, Fox, like Friedman, had "no reasonable basis for relying on
anything other than an at-will relationship."     Id. at 297.

                                   III.

     We hold as a matter of law that Fox failed to produce sufficient
evidence of a clear and definite promise of continued employment terminable
only for cause to overcome the strong presumption of at-will employment in
Minnesota.    The jury verdict on her promissory estoppel claim therefore
cannot stand, and T-H is entitled to judgment as a matter of law.
Accordingly, the judgment of the District Court is reversed.

     A true copy.

             Attest:

                  CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.

                                   -11-