Marisa Hunt v. State of Minnesota, American Federation of State, County, and Municipal Employees - Minnesota Council 5 ( 2016 )

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A16-0070
Marisa Hunt,
Appellant,
vs.
State of Minnesota,
Respondent,
American Federation of State, County, and
Municipal Employees - Minnesota Council 5, Defendant
Filed July 5, 2016
Affirmed
Smith, Tracy M., Judge
Ramsey County District Court
File No. 62-CV-15-1451
Steven E. Uhr, Law Office of Steven E. Uhr, PLLC, Eden Prairie, Minnesota (for
appellant)
Lori Swanson, Attorney General, Thomas S. Madison, Assistant Attorney General,
St. Paul, Minnesota (for respondent)
Considered and decided by Worke, Presiding Judge; Schellhas, Judge; and Smith,
Tracy M., Judge.
UNPUBLISHED OPINION
SMITH, TRACY M., Judge
Appellant Marisa Hunt appeals the dismissal of her breach-of-contract claim for
failure to state a claim upon which relief can be granted. Because the district court did
not err in concluding that Hunt’s complaint is insufficient as a matter of law, we affirm.
FACTS1
Hunt worked for the MinnesotaCare Program at the State of Minnesota,
Department of Human Services (DHS) until she was discharged from employment on
October 28, 2011. Hunt was a member of the American Federation of State, County, and
Municipal Employees (AFSCME), which timely challenged Hunt’s termination from
employment.
Before arbitration, the parties resolved the grievance and entered into a settlement
and release dated January 27, 2012. The January 2012 agreement required Hunt to
submit a letter of resignation from employment, effective November 1, 2011, and
required respondent State of Minnesota to remove all documentation regarding Hunt’s
termination from her personnel file. The agreement also contained a clause stating that
the “Settlement and Release represents the total agreement between the parties and final
and complete resolution of the aforementioned grievances.” Hunt signed the January
2012 agreement, as did AFSCME’s business representative and its local president, and a
MinnesotaCare manager on behalf of the state.
1
The following “facts” are taken from Hunt’s complaint and are presumed to be true for
purposes of this appeal.
2
The state and AFSCME entered into a second agreement dated December 21,
2012. Among other terms, the December 2012 agreement required Hunt “to neither seek
nor accept any future employment with the State of Minnesota” for a period of ten years
from the date of her resignation. Again, AFSCME’s business representative and local
president signed the agreement, as did the MinnesotaCare manager and DHS’s deputy
human-resources director. Hunt did not sign the December 2012 agreement, but
AFSCME’s business representative signed his name on Hunt’s signature line, indicating
that he was signing “for” Hunt.
Beginning in July 2013, Hunt applied for approximately six positions with the
state. The state did not acknowledge receipt of her applications and did not communicate
with Hunt until sending her a letter in January 2015. The letter informed Hunt that, under
the December 2012 agreement, she was prohibited from seeking employment with the
state until October 31, 2021. The letter further stated that Hunt’s applications were
rejected in accordance with the December 2012 agreement and that future applications
would also be rejected.
Hunt sued the state for breach of contract and AFSCME for violation of the duty
of fair representation. As the basis of her breach-of-contract claim, Hunt alleged that the
January 2012 agreement constituted a binding contract, that the state breached the
contract by refusing her employment applications, and that, but for the state’s breach, she
likely would have obtained employment. Hunt also alleged that a DHS human-resources
employee told her that the January 2012 agreement “did not preclude her from seeking
future employment with the State of Minnesota.”
3
The state moved to dismiss Hunt’s breach-of-contract claim for failure to state a
claim upon which relief can be granted. See Minn. R. Civ. P. 12.02(e). The district court
granted the state’s motion to dismiss. The district court reasoned that, even assuming the
January 2012 agreement is an enforceable contract, nothing in the agreement obligates
the state to consider Hunt’s job applications or offer her employment. Therefore, the
district court concluded that “it appears to a certainty that [Hunt] would be entitled to no
relief under any statement of facts which could be proved in support of her claim against
the [state].”2
Hunt appeals.
DECISION
I.
Hunt argues that the district court erred when it dismissed her breach-of-contract
claim. A party may assert by motion the defense of “failure to state a claim upon which
relief can be granted.” Minn. R. Civ. P. 12.02(e). “A claim is sufficient against a motion
to dismiss for failure to state a claim if it is possible on any evidence which might be
produced, consistent with the pleader’s theory, to grant the relief demanded.” Walsh v.
U.S. Bank, N.A., 851 N.W.2d 598, 603 (Minn. 2014). “To state it another way, under this
rule a pleading will be dismissed only if it appears to a certainty that no facts, which
could be introduced consistent with the pleading, exist which would support granting the
2
Hunt and AFSCME stipulated to the dismissal of Hunt’s claim against AFSCME, and
the district court ordered dismissal with prejudice on November 30, 2015.
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relief demanded.” N. States Power Co. v. Franklin, 265 Minn. 391, 395, 122 N.W.2d 26,
29 (1963).
On appeal from a dismissal under rule 12.02(e), we review the legal sufficiency of
the claim de novo. Graphic Commc’ns Local 1B Health & Welfare Fund A v. CVS
Caremark Corp., 850 N.W.2d 682, 692 (Minn. 2014). In reviewing the sufficiency of a
complaint, “[w]e accept the facts alleged in the complaint as true and construe all
reasonable inferences in favor of the nonmoving party.” Walsh, 851 N.W.2d at 606.
“We are not bound by legal conclusions stated in a complaint when determining whether
the complaint survives a motion to dismiss for failure to state a claim.” Hebert v. City of
Fifty Lakes, 744 N.W.2d 226, 235 (Minn. 2008). When a contract is “central to the
claims alleged” and is embraced by the complaint, we may consider the entire written
contract. In re Hennepin Cty. 1986 Recycling Bond Litig., 540 N.W.2d 494, 497 (Minn.
1995).
Motion to Dismiss or Summary Judgment
Hunt contends that our review should be of a grant of summary judgment and not
of a motion to dismiss. “Rule 12.02 provides that [a motion to dismiss for failure to state
a claim] shall be treated as a motion for summary judgment and disposed of as provided
in Rule 56 if matters outside the pleadings are submitted to the district court for
consideration and not excluded.” N. States Power Co. v. Minn. Metro. Council, 684
N.W.2d 485, 490 (Minn. 2004); see Minn. R. Civ. P. 12.02. But a “[district] court may
consider documents referenced in a complaint without converting the motion to dismiss
to one for summary judgment.” N. States Power Co., 684 N.W.2d at 490.
5
The parties submitted a number of documents with their motion papers, but the
district court confined its analysis to the January 2012 agreement, on which Hunt based
her breach-of-contract claim against the state and which she referenced in her complaint.
We disagree with Hunt’s assertion that rule 56.03 applies and confine our review to the
rule 12.02 standard employed by the district court. See id.
Breach of Contract—January 2012 Agreement
Hunt argues that the district court erred when it dismissed her claim for breach of
contract based on the January 2012 agreement. The district court determined that Hunt
would not be entitled to relief under any conceivable set of facts because, even assuming
the January 2012 agreement is an enforceable contract, it does not obligate the state to
consider Hunt for future employment.
To establish a breach-of-contract claim, a plaintiff must prove three elements:
“(1) formation of a contract, (2) performance by plaintiff of any conditions precedent to
his right to demand performance by the defendant, and (3) breach of the contract by
defendant.” Park Nicollet Clinic v. Hamann, 808 N.W.2d 828, 833 (Minn. 2011). A
contract is breached when one party fails to perform, without legal justification, a
substantial part of the contract. Estate of Riedel v. Life Care Ret. Cmtys., Inc., 505
N.W.2d 78, 81 (Minn. App. 1993).
Hunt contends that the state breached the January 2012 agreement when it rejected
her employment applications without consideration because the “parties intended that the
January 2012 agreement would not bar Hunt from future state employment.” Hunt’s
argument raises an issue of contract interpretation, which we review de novo. Travertine
6
Corp. v. Lexington-Silverwood, 683 N.W.2d 267, 271 (Minn. 2004). “Where there is a
written instrument, the intent of the parties is determined from the plain language of the
instrument itself.” Id. Ambiguity exists only if the contract’s terms are susceptible to
more than one reasonable interpretation. Metro. Sports Facilities Comm’n v. Gen. Mills,
Inc., 470 N.W.2d 118, 123 (Minn. 1991). If the contract is “clear and unambiguous,
courts should not rewrite, modify, or limit its effect by a strained construction.”
Travertine Corp., 683 N.W.2d at 271.
We discern no ambiguity in the January 2012 agreement, and the agreement’s
plain language evidences no intent to contractually obligate the state to consider Hunt’s
future employment applications. Paragraph 1 requires Hunt to provide a written
resignation prior to the agreement’s execution. Paragraph 2 obligates the state to remove
all termination documentation from Hunt’s personnel file. Paragraph 3 states that the
agreement is to be a release of all claims that the parties may have against each other.
Paragraph 4 states that the agreement is not an admission of liability by the employer.
Paragraph 5 states that the agreement is not precedent setting. Paragraph 6, the final
clause, states that the agreement “represents the total agreement between the parties and
final and complete resolution of the aforementioned grievances.” We agree with the
district court’s conclusion that “[n]othing about the January 2012 Agreement obligates
the State to accept or consider [Hunt’s] application.”
Hunt also contends that an alleged oral statement by a DHS human-resources
employee that the January 2012 agreement would not prevent her from seeking
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employment precludes dismissing her claim at the pleading stage.3 Specifically, Hunt
contends that this parol evidence may be used to interpret or add a consistent additional
term to the January 2012 agreement. We disagree.
The parol-evidence rule
prohibits the admission of extrinsic evidence of prior or
contemporaneous oral agreements, or prior written
agreements, to explain the meaning of a contract when the
parties have reduced their agreement to an unambiguous
integrated writing. Accordingly, when parties reduce their
agreement to writing, parol evidence is ordinarily
inadmissible to vary, contradict, or alter the written
agreement.
Danielson v. Danielson, 721 N.W.2d 335, 338 (Minn. App. 2006) (quotation omitted).
The January 2012 agreement was reduced to writing. The written agreement states that it
“represents the total agreement between the parties and final and complete resolution of
the aforementioned grievances.” The January 2012 agreement is unambiguous, and
nothing in Hunt’s pleadings or the agreement suggests that it is incomplete. Even
assuming the allegation of the statement by the human-resources employee is true, it may
not be used to “vary . . . or alter the [integrated] written agreement.” See id.; see also
Alpha Real Estate Co. of Rochester v. Delta Dental Plan of Minn., 664 N.W.2d 303, 313
3
In addition to this statement, Hunt cites to a number of matters extrinsic to the
complaint including (1) the state’s “regular practice” of negotiating grievance settlements
with explicit employment bans, (2) discussions between the state and AFSCME about a
possible future employment ban, (3) the state’s “repudiation” of the January 2012
agreement (presumably with the December 2012 agreement) because it did not contain an
employment ban, and (4) the state’s acknowledgment that the January 2012 and
December 2012 agreements are “materially different.” But this is a review of a dismissal
for failure to state a claim, not of summary judgment. Accordingly, our review is limited
to the complaint’s factual allegations and the documents referenced therein. See N. States
Power Co., 684 N.W.2d at 490.
8
(Minn. 2003) (refusing to consider parol evidence when the written agreement stated that
it was the “entire agreement between the parties”). Consequently, the oral statement
pleaded by Hunt does not preclude dismissal for failure to state a claim.
Accepting all of Hunt’s factual allegations as true and drawing all reasonable
inferences in her favor, we conclude that “it appears to a certainty that no facts, which
could be introduced . . . exist which would support granting the relief demanded.” See
N. States Power Co., 265 Minn. at 395, 122 N.W.2d at 29. The district court did not err
in dismissing Hunt’s breach-of-contract claim.
II.
Hunt also argues that the district court’s decision “lets the state act in an arbitrary
and capricious manner.” Hunt contends that the state “has an obligation and
responsibility to treat similarly situated job applicants in a similar manner.” This theory
of relief was not presented to the district court in Hunt’s amended complaint or in her
memorandum of law opposing the state’s motion to dismiss. Therefore, Hunt’s arbitrary-
and-capricious argument is not properly before this court. See Toth v. Arason, 722
N.W.2d 437, 443 (Minn. 2006) (stating that “a reviewing court generally may consider
only those issues that the record shows were presented to and considered by the [district]
court” (quotation omitted)).
Affirmed.
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