Court Opinion

ID: 9791893
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:20:12.297812+00
Date Added: 2024-06-11T07:37:39.267600
License: Public Domain

BISTLINE, Justice,
concurs in part and dissents in part.
I applaud the Court’s reassessment of the Metcalf “prospective only” ruling. No rational reason prevents or limits the application of an implied covenant of good faith and fair dealing to employment contracts. Although our initial opinion for the Court denied Sorensen all relief, today’s modification does provide Sorensen his day in court and justice may be done.
The decision to apply Metcalf to all cases which had been filed when Metcalf was decided, and of course to all new appeals, is appropriate for two reasons. Where two or more plaintiffs have initiated actions which are similarly premised and one is decided by an appellate court whereas the other has been delayed en route, there is no sound reason for denying the other case the benefit of a new rule of law simply because of the happenstance of being second in time. See State v. Owens, 101 Idaho 632, 619 P.2d 787 (1980) (the Court, over Bistline, J.’s objection, refused on rehearing to apply the holding of Sandstrom v. Montana, 442 U.S. 510, 99 S.Ct. 2450, 61 L.Ed.2d 39 (1979), in which a certain jury instruction was disapproved. Bistline, J., dissented, and quoted from Hankerson v. North Carolina, 432 U.S. 233, 97 S.Ct. 2339, 53 L.Ed.2d 306 (1977)). In Hankerson v. North Carolina, Justice Powell wrote:
When the Court declines to hold a new ... rule retroactive, one chance beneficiary — the lucky individual whose case was chosen as the occasion for announcing the new principle — enjoys retroactive application, while others similarly situated have their claims adjudicated under the old doctrine. This hardly comports with the ideal of ‘administration of justice with an even hand.’ Desist v. United States, [394 U.S. 244, 255, 89 S.Ct. 1030, 1037, 22 L.Ed.2d 248 (1969) ] (Douglas, J. dissenting).
Hankerson, 432 U.S. at 248, 97 S.Ct. at 2347 (Powell, J., concurring in the judgment) (footnote omitted).
Second, the Court of Appeals had recognized actions for discharge motivated by bad faith long before Metcalf was written. Actions for bad faith necessarily implicate an implied or express covenant of good faith and fair dealing. So, unless this Court has expressly overruled these Court of Appeals holdings, a Metcalf prospective-only rule would have produced a contradictory split between the two appellate courts.
In Holmes v. Union Oil Co. of California, 114 Idaho 773, 760 P.2d 1189 (Ct.App.1988), review denied 1988, the Court of Appeals, on the ground that a material issue of fact remained, reversed the grant of summary judgment to the employer. The Court of Appeals realized that the-terms and duration of the employment relationship were unclear, and as yet undefined by a trier of fact, and thus precluded summary judgment disposition of the matter. Holmes also recognized that where a covenant of good faith and fair dealing exists, liability will attach where one party acting in bad faith contravenes the covenant.
Holmes was later interpreted by the Court of Appeals to hold that “a covenant of good faith and fair dealing may be implicated where the discharge is a product of bad faith directed personally at a particular employee.” Nilsson v. MAPCO, 115 Idaho 18, 23, 764 P.2d 95, 100 (Ct.App.1988), citing with approval to Holmes. A new trial was ordered in Nilsson because the jury instructions “failed to apprise the jury that a covenant of good faith and fair dealing would not give rise to an independent ground of employer liability unless the em*671ployee showed that his discharge was a product of bad faith directed personally at him.” Id. By lifting the restriction on the Metcalf holding this Court properly aligns the precedent of this Court and the Court of Appeals.
I dissent from the majority opinion only in regard to one narrow facet. Unlike the majority, I am not presently convinced that the relationship under scrutiny here is an employment-at-will relationship. The majority opinion, by affirming the district court’s grant of summary judgment as to the nature of the employment contract, affirms the district court in not letting a jury serve as the trier of fact, even though the material terms of the employment relationship are unclear. If the employee was required to give notice, no reason surfaces why the employer should not also provide the employee with notice that the relationship will be terminated.
The Idaho case law precedent existing at the time this action accrued provided that in employment-at-will relationships both the employer and the employee may terminate the relationship at any time without cause. The reciprocity of this relationship was recognized by the Court of Appeals: “Employment at will may be terminated by either party for any reason without liability, except that an employee may not be discharged for a reason contravening public policy.” Whitlock v. Haney Seed Co., 110 Idaho 347, 348, 715 P.2d 1017, 1018 (Ct.App.1986) (citation omitted), affirmed with modifications, 114 Idaho 628, 759 P.2d 919 (Ct.App.1988). In Metcalf, a majority of this Court wrote that:
[I]n the absence of an agreement between the employer and the employee limiting the employer’s (or the employee’s) right to terminate the contract at will, either party to the employment agreement may terminate the relationship at any time or for any reason without incurring liability. [Citation omitted.] However, such a limitation on the right of the employer (or the employee) to terminate the employment relationship ‘can be express or implied.’ [Citation omitted.] A limitation may be implied if, from all the circumstances surrounding the employment relationship, a reasonable person could conclude that both parties intended that the employer’s (or the employee’s) right to terminate the employment relationship-at-will had been limited by the implied-in-fact agreement of the parties. [Citations omitted.]
Metcalf v. Intermountain Gas Co., 116 Idaho 622, 624, 778 P.2d 744, 746 (1989).
Metcalf also recognized that employment handbooks and manuals serve to provide evidence of the terms of the employment relationship. Here, the employment manual explicitly destroyed the reciprocity of the relationship between the employee and employer. As the district court took pains to observe:
Commtek had a Practices and Procedures Manual which, while it set forth a procedure for disciplinary action, also provided in several places that all employees were terminable at will. See: ‘Termination of Employment,’ Practices and Procedures Manual, pages 11, 12, 23. The Manual provides: ‘COMMTEK MAY TERMINATE EMPLOYMENT FOR ANY REASON WHATSOEVER WITH OR WITHOUT CAUSE.’ While the Manual imposes a notice of intent to resign requirement on the employees, no similar restriction is imposed upon Commtek.
R. 63-4. Clearly, the employee’s right to terminate at will was severely limited, if not obliterated, by the employment manual, while the employer’s right remained unfettered. Without requisite reciprocity to terminate at will, there surfaces the question whether this relationship truly was terminable-at-will employment. That issue ordinarily is left to a jury; it is an issue of fact that will ultimately be determined by considering and resolving conflicting evidence. As the Court of Appeals has recognized, when the terms of an employment relationship are unclear, and the evidence is conflicting or uncertain, then it is for the jury to determine the parameters of the employment relationship, absent a waiver of jury trial. See Nilsson v. MAPCO, 115 Idaho 18, 22 n. 2, 764 P.2d 95, 99 (Ct.App.1988).
*672For the reasons stated above, I would remand this case for trial both as to the express or implied covenant of good faith and fair dealing, and as to the nature of the relationship that existed between Sorensen and his employer.