Fournier v. United States Fidelity & Guaranty Co.

KARWACKI, Judge. On June 24, 1987, Peter J. Fournier, the appellant, filed an action in the Circuit Court for Baltimore City against United States Fidelity and Guaranty Company, the appellee, alleging that his employment by appellee had been wrongfully terminated. He sought compensatory and punitive damages. After the parties had conducted discovery, appellee moved for summary judgment.

Following a hearing on ³³ that motion and appellant’s opposition thereto, the court entered summary judgment in favor of the appellee. In his appeal from that judgment appellant questions the propriety of the court’s disposition of his claim by summary judgment. FACTS The record before the hearing judge, when viewed most favorably to the appellant, Rule 2-501(a); Berkey v. Delia, 287 Md. 302, 304-05 , 413 A.2d 170 (1980); Laws v. Thompson, 78 Md.App. 665, 673-674 , 554 A.2d 1264 (1989), discloses the following material facts on which the summary judgment was based. In September of 1984 appellant met with an employee recruiter for the appellee and with two persons in appellee’s Business Planning Group, Mr. Everett G. Miller, and Ms. Teriko Goodwyn.

At the conclusion of those interviews he was told that he would be hearing from them later. Appellant was asked to return on September 28, 1984. He again met with Mr. Miller who advised him that appellee was prepared to offer him a position as a Principal Analyst in its Business Planning Group. On that day appellant completed an application for employment.

The following paragraph prominently appeared above the line on which appellant signed the application: I understand that, if I am employed, it will be for a trial period of three months; that, if in the judgment of the Company I am unsuitable during this period, the employment may be terminated by the Company without notice; and that, after this trial period, the employment may be terminated by either party at will upon two weeks’ notice to the other. In any event, all obligation on the Company’s part as respects salary shall end with the last day I work. Appellant’s employment by appellee was confirmed in a letter dated October 10, 1984, which he received from Mr. ³⁴ R. G. Strother of appellee’s Human Resources Department and Ms. Goodwyn. That letter stated: We would like to confirm our offer and your acceptance for the position of Principal Analyst in the Data Processing Department.

In this position you will be reporting directly to Teriko Goodwyn, Acting Supervisor, and your starting salary will be $750.00/weekly, paid bi-weekly, with a starting date of October 15, 1984. We are very pleased that you are considering pursuing your career with USF & G. It is our firm belief that your skills, work experience, education, and potential will enable you to contribute to the continued success of USF & G. We equally believe that we as a Company can provide you with the opportunity for both professional and personal career advancement. As a routine procedure, we have initiated an investigation of your employment background. Our offer is contingent upon favorable verifications; however, we do not anticipate any problems.

We would like you to respond to our offer with a written acceptance to Bob Strother, Human Resources Department, as soon as possible. In your acceptance letter, please confirm your actual starting date and Social Security Number. Along with your acceptance letter, please complete and return the attached Medical History Form. On your first day, please report to Bob Strother, in the Human Resources Department, on the 4th floor, at 9:00 a.m.

At that time you will need to provide proof of age for enrollment in our Pension Plan, so please bring with you your Driver’s License or original birth certificate. We would like to welcome you and wish you every success in your career with USF & G. If you have any questions regarding your offer, the position, or the Company, please don’t hesitate to call either of us. Appellant accepted this formal offer and went to work for appellee. For the first year of his employment appellant’s ³⁵ job performance was more than satisfactory to his supervisors.

Approximately two weeks after appellant began working for appellee, he attended an orientation program for new employees. At that time he received an employee handbook entitled “Employee’s Guide to Personnel Practices.” Under the section of the handbook entitled “Terminations” the following appears: DISMISSALS The Company intends to make every effort to avoid terminating an employee’s service. It is recognized that dishonesty, misconduct or insubordination must be dealt with promptly. Dismissals for other causes are resorted to only after efforts to remedy the trouble have failed.

Length of service is considered in determining the amount of notice or separation pay in lieu of notice but in no event will it be less than two weeks for employees with more than three months service. An effort is also made to provide time off to seek other employment before the termination becomes effective. That personnel policy was in effect at the time appellant was employed by appellee, and it remained in effect through the date of his discharge. During November of 1985 the Business Planning Group to which appellant had been assigned was disbanded, and appellant was transferred to the Capacity Planning Group, supervised by Ms. Kit Fechtig.

Appellant’s salary remained the same while his duties changed somewhat. Appellant began to demonstrate deficiencies in his job performance shortly after his transfer to the Capacity Planning Group. In December of 1985 he failed to complete five of six assignments which he had been given by his supervisor. He was reprimanded by his supervisor on two occasions between December 10, 1985, and January 15, 1986.

On one occasion he arrived late at work and left one hour early. On January 10, 1986, he took an extended lunch ³⁶ break and missed a scheduled meeting with the superintendent of the Capacity Planning Group. Appellant admitted that he missed the January 10, 1986, meeting in order to keep an appointment with the director of admissions at St. Agnes Hospital relating to a company he had organized in September of 1985 named “Caesar Software.” Appellant formed that company with the participation of his fellow employees, Everett G. Miller and Mark Wolkow. They planned to develop and market software for a hospital operating room scheduling and management system.

Miller and Wolkow each received 5% of the stock of Caesar Software for their work in getting the enterprise started. Appellant planned to issue 51% of the stock to himself for his services and to sell the other 39% of the stock to outside investors. By January 13, 1986, appellant, Miller, and Wolkow had been successful in selling $18,000 worth of the stock to their relatives and fellow employees at appellee. The three men also contracted with Carl Evans, another employee of appellee, to perform computer programming work for Caesar Software.

During late 1985 and early 1986 appellant worked 20 to 25 hours a week on the business of Caesar Software, but contended that none of this work was done during his working hours at appellee. He admitted that he discussed that business with Miller and Wolkow while at work for appellee, but stated that these discussions did not interfere with any of their duties. He further admitted that he made and received telephone calls concerning his outside enterprise while at work for appellee, but he testified that these calls were only for the purpose of arranging meetings after his working hours at appellee. By January 13, 1986, the hierarchy of appellee had learned of appellant’s involvement with Caesar Software.

He was summoned to a meeting with Walter Zilahy, Vice President of appellee’s data processing division, John Wit-zen, Vice President of appellee’s internal audit division, and Frank Bossle, Assistant Vice President of appellee’s inter ³⁷ nal audit division. They asked appellant to explain his involvement in Caesar Software which appellant did. Mr. Zilahy was in charge of the investigation and had the ultimate authority to determine what action should be taken. Zilahy decided to fire appellant and did so on January 17, 1986.

He also took disciplinary action against Miller, Wolkow, and Evans for their involvement in Caesar Software. They received written reprimands which were placed in their personnel files maintained by appellee. DISCUSSION In Adler v. American Standard Corp., 291 Md. 31 , 432 A.2d 464 (1981), the Court of Appeals reaffirmed the common law rule that one who is employed for an indefinite duration may be discharged at any time at the pleasure of his employer. Nevertheless, when an employer communicates personnel policy statements to its employees which “... limit the employer’s discretion to terminate an indefinite employment or that set forth a required procedure for termination of such employment ... ”, such statements, if justifiably relied on by its employee, may "... become contractual undertakings by the employer that are enforceable by its employee.” Staggs v. Blue Cross of Md., Inc., 61 Md.App. 381, 392 , 486 A.2d 798 (1985), cert. denied, 303 Md. 295 , 493 A.2d 349 (1985).

Appellant concedes, as he must, that when he applied for employment by appellee he knew, or should have known, that appellee disclaimed any intention of employing appellee for a fixed term or of limiting its discretion to terminate appellant’s employment at its pleasure. That was unequivocally set forth in the application for employment which appellant completed and signed on September 28, 1984. Appellant contends, however, that appellee expressed a contrary intention in the letter addressed to him on October 10, 1984, by Mr. Strother of appellee’s Human Resources Department and Ms. Goodwyn and in certain personnel policy statements made by appellee which appear in the “Employee’s Guide to Personnel Practices” which appellant ³⁸ received at the orientation program for new employees of appellee. We shall address each of those alternatives in turn.

A. The October 10 Letter. This letter, which we have quoted in full above, confirmed appellee’s offer and appellant’s acceptance of the position for which appellant applied on September 28, 1984. Appellant argues that appellee modified the at-will employment contract which he was offered on September 28 by not mentioning that type of employment contract in the letter and by the following statement which appears therein: We are very pleased that you are considering pursuing your career with USF & G. It is our firm belief that your skills, work experience, education, and potential will enable you to contribute to the continued success of USF & G. We equally believe that we as a Company can provide you with the opportunity for both professional and career advancement. We are not persuaded.

The precatory language in the letter relied on by appellant falls far short of an expression by appellee of an offer of a unilateral contract of employment to appellant which only could be