Court Opinion

ID: 1070580
Source: CourtListenerOpinion
Date Created: 2013-10-09 19:38:46.640795+00
Date Added: 2024-06-11T12:56:09.644315
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
            MIDDLE SECTION AT NASHVILLE

BRENDA L. LEE,                    )
                             )
     Plaintiff/Appellant,    )
                             )
                             )    Davidson Circuit
VS.                          )    No. 95C-2597
                             )
                             )    Appeal No.
HIPPODROME OLDSMOBILE, INC., )    01A01-9705-CV-00202
ROBERT E. McADAMS,           )
STEVE JACKSON,               )
                             )
     Defendants/Appellees.   )

     APPEAL FROM THE CIRCUIT COURT FOR DAVIDSON COUNTY
                  AT NASHVILLE, TENNESSEE

             THE HONORABLE BARBARA N. HAYNES, JUDGE

For the Plaintiff/Appellant:      For the Defendants /Appellees:

Jane J. Buffaloe                  C. Dewey Branstetter, Jr.
Nashville, Tennessee              Bryan E. Pieper
                                  Branstetter, Kilgore, Stranch & Jennings
                                  Nashville, Tennessee

         AFFIRMED IN PART; VACATED IN PART;
                  AND REMANDED

                                        WILLIAM C. KOCH, JR., JUDGE
                                       OPINION

      This appeal results from an employer’s recruitment and subsequent termination
of an at-will employee after only two weeks of work. The employee filed suit in the
Circuit Court for Davidson County alleging breach of an implied employment
contract, promissory fraud, and outrageous conduct. The trial court granted the
employer’s Tenn. R. Civ. P. 12.02(6) motion to dismiss for failure to state a claim
upon which relief can be granted, and the employee appealed. We vacate the order of
dismissal because we have decided that the complaint states a claim for promissory
fraud, albeit barely.

                                                 I.

      Hippodrome Oldsmobile, Inc. hired Brenda L. Lee as its Director of Finance
in February 1995. Ms. Lee had held a similar position at another automobile
dealership for five years and was induced to accept Hippodrome’s job by offers of
comparable salary, bonuses, and other benefits, as well as a promise of “long-term,
permanent” employment. Ms. Lee began her new job on March 13, 1995, but on
April 1, 1995, she was summarily terminated when Hippodrome’s general sales
manager informed her that her position had been eliminated.

      On August 15, 1995, Ms. Lee sued Hippodrome and its owner, general
manager, and general sales manager in the Circuit Court for Davidson County,
alleging that their “fraudulent representations” had “fraudulently induced [her] to
enter into a contract of employment with Hippodrome” and that this conduct was
“outrageous and unlawful.”1 The defendants later filed a Tenn. R. Civ. P. 12.02(6)
motion to dismiss Ms. Lee’s complaint for failure to state a claim upon which relief
can be granted. On November 27, 1997, the trial court granted the motion and
dismissed the complaint.

                                                 II.

      1
          Ms. Lee later agreed to dismiss her claims against the general sales manager.

                                                -2-
        A Tenn. R. Civ. P. 12.02(6) motion to dismiss for failure to state a claim upon
which relief can be granted tests the legal sufficiency of the complaint, not the
plaintiff’s proof. See Cook v. Spinnaker’s of Rivergate, Inc., 878 S.W.2d 934, 938
(Tenn. 1994); Coulter v. Hendricks, 918 S.W.2d 424, 426 (Tenn. Ct. App. 1995). The
basis for the motion is that the allegations in the complaint, considered alone and
taken as true, are insufficient to state a claim as a matter of law. See Pursell v. First
Am. Nat’l Bank, 937 S.W.2d 838, 840 (Tenn. 1996); Fletcher v. Board of Prof’l
Responsibility, 915 S.W.2d 448, 450 (Tenn. Ct. App. 1995); Wells v. Tennessee Bd.
of Paroles, 909 S.W.2d 826, 827 (Tenn. Ct. App. 1995).

        In light of the liberal pleading standards of the Tennessee Rules of Civil
Procedure, Tenn. R. Civ. P. 12.02(6) motions are rarely granted.2 See Kaylor v.
Bradley, 912 S.W.2d 728, 731 (Tenn. Ct. App. 1995); Dobbs v. Guenther, 846
S.W.2d 270, 273 (Tenn. Ct. App. 1992). These liberal pleading standards apply to
challenges to fraud claims. See Dobbs v. Guenther, 846 S.W.2d at 274. Thus, courts
must take all the factual allegations as true and must construe the complaint liberally
in favor of the plaintiff. See Wallace v. National Bank of Commerce, 938 S.W.2d 684,
689 n.1 (Tenn. 1996); Fletcher v. Board of Prof’l Responsibility, 915 S.W.2d at 450;
Axline v. Kutner, 863 S.W.2d 421, 423 (Tenn. Ct. App. 1993). A plaintiff’s claim
should be dismissed for failure to state a claim only if it appears that the plaintiff can
prove no set of facts in support of his claim that would entitle him to relief. See Cook
v. Spinnaker’s of Rivergate, 878 S.W.2d at 938; Pemberton v. American Distilled
Spirits Co., 664 S.W.2d 690, 691 (Tenn. 1984); Rampy v. ICI Acrylics, Inc., 898
S.W.2d 196, 198 (Tenn. Ct. App. 1994).

        The allegations in Ms. Lee’s complaint state a claim for promissory fraud only.
Promissory fraud requires: (1) an intentional misrepresentation of a material fact, (2)
knowledge of the representation’s falsity, (3) an injury caused by reasonable reliance
on the representation, and (4) a promise of future action with no present intent to

        2
          Tenn. R. Civ. P. 8.01 provides that “[a] pleading which sets forth a claim for relief . . . shall
contain (1) a short and plain statement of the claim showing that the pleader is entitled to relief, and
(2) a demand for judgment.” Tenn. R. Civ. P. 1 states that the rules are to be construed to “secure
the just, speedy and inexpensive determination of every action,” and Tenn. R. Civ. P. 8.06 mandates
that the pleadings be interpreted to “do substantial justice.”

                                                   -3-
perform. See Dobbs v. Guenther, 846 S.W.2d at 274; Oak Ridge Precision Indus., Inc.
v. First Tennessee Bank Nat’l Ass’n, 835 S.W.2d 25, 29 (Tenn. Ct. App. 1992). Ms.
Lee’s complaint alleges that Hippodrome’s promise of “long-term, permanent”
employment was a “fraudulent misrepresentation” and “fraudulently induced” her to
enter into an employment contract with Hippodrome. These allegations are minimally
sufficient to state a claim for promissory fraud. Ms. Lee did not have to specifically
allege that the defendants had no intention of keeping their promise. Her allegations
that the promise of long-term future employment was a fraudulent misrepresentation
were adequate to give the defendants fair notice of the nature of the claim against
them.

        Our decision should not be construed as carving out an exception to the
employment at will doctrine. Ms. Lee has no contractual claim based on the oral
promise of long-term employment. See Combs v. Standard Oil Co., 166 Tenn. 88,
90-92, 59 S.W.2d 525, 526-27 (1933); Price v. Mercury Supply Co., 682 S.W.2d 924,
934 (Tenn. Ct. App. 1984). By allowing Ms. Lee’s claim for promissory fraud, we
are imposing liability only when an employer makes an offer of long-term, permanent
employment with no present intention of keeping its promises.

                                         III.

        Ms. Lee’s remaining claims of breach of an implied employment contract and
outrageous conduct were rightfully dismissed because they fail to state a claim in
light of Tennessee’s employment at will doctrine. Accordingly, we vacate the
dismissal of Ms. Lee’s claim for promissory fraud and affirm the dismissal of the
remaining claims. We also tax the costs of this appeal to Hippodrome Oldsmobile,
Inc. for which execution, if necessary, may issue.

                                                _____________________________
                                                WILLIAM C. KOCH, JR., JUDGE

CONCUR:

_________________________________

                                         -4-
HENRY F. TODD, PRESIDING JUDGE
MIDDLE SECTION

_________________________________
WALTER W. BUSSART, JUDGE

                               -5-