Starkey v. Am. Legion Post 401, Caledonia, Inc.

[Cite as Starkey v. Am. Legion Post 401, Caledonia, Inc., 2010-Ohio-2166.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
MARION COUNTY
KAREN L. STARKEY, CASE NO. 9-09-49
PLAINTIFF-APPELLANT,
v.
AMERICAN LEGION POST 401, OPINION
CALEDONIA, INC., ET AL.,
DEFENDANTS-APPELLEES.
Appeal from Marion County Common Pleas Court
Trial Court No. 08 CV 0099
Judgment Affirmed
Date of Decision: May 17, 2010
APPEARANCES:
Robert E. Wilson, for Appellant
Matthew P. Frericks, for Appellee
Case No. 9-09-49
SHAW, J.
{¶1} Plaintiff-appellant Karen L. Starkey (“Karen”) appeals the
September 14, 2009 Judgment Entry of the Marion County Court of Common
Pleas granting summary judgment in favor of defendant-appellee American
Legion Post 401, Caledonia, Inc., et al (“Post 401”) and dismissing Karen’s claim
for wrongful termination.
{¶2} This appeal arises out of the following facts. In the fall of 1999,
Karen was employed as a part-time bartender at Post 401. At this time, Karen was
also employed full-time at GTE of Marion where she had worked for the past 22
years. In May of 2000, Post 401’s Executive Committee offered Karen the full-
time position of Canteen Manager. Karen quit her job at GTE and accepted the
position. As Canteen Manager, Karen worked solely under the authority of the
Executive Committee.
{¶3} With the exception of a salary increase and additional job duties
assigned to her in 2002, Karen’s position as Canteen Manager remained the same
until 2007. In August of 2007, the Commander of Post 401, Bill Sayre, received
complaints from the other bartenders that Karen had become an absentee manager.
As a result, some supplies were so depleted that the bartenders had to leave their
shift and go into town to replenish the supplies. Despite receiving these verbal
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complaints, neither Sayre nor any other member of the Executive Committee
confronted Karen with these issues. The Executive Committee discussed
terminating Karen as Canteen Manager during their September meeting, but
deferred the decision until a subsequent meeting on October 27, 2007.
{¶4} On October 6, 2007, Sayre and a few other Post 401 members
conducted a meeting based in part on the mistaken belief that a meeting was
scheduled for that day. At this meeting, the decision was made to terminate Karen
despite the fact that less than half of the Executive Committee members were
present. The following Monday, October 8, 2007, Sayre handed Karen a letter
informing her that effective October 9, 2007, her services as Canteen Manager
were no longer needed and asked for her resignation. Karen complied with the
request and October 8, 2007 was the last day Karen reported to work.
{¶5} Three subsequent meetings were held in October of 2007. The
Executive Committee determined that the October 6th meeting, resulting in the
decision to terminate Karen, was not conducted in accordance with Post 401’s
bylaws. The Executive Committee subsequently decided to throw out the minutes
from that meeting. Shortly thereafter, Post 401 received a letter from Karen’s
attorney concerning her employment as Canteen Manager. At their next meeting,
the Executive Committee members voted to reinstate Karen as Canteen Manager
and scheduled a meeting with her.
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{¶6} On November 12, 2007, Karen attended the Special Meeting of the
Executive Committee where she was informed that her termination was improper
and she was invited to return to her position as Canteen Manager. Karen told the
Executive Committee members that she would consider returning if the Executive
Committee: 1) reviewed and updated her duties as Canteen Manager; 2) completed
an accounting of the Canteen’s finances during her absence and; 3) wrote her a
letter of apology to be posted in the club. Karen further informed the Executive
Committee that once these three tasks were completed, she would then need a few
days to consider her return as Canteen Manager.
{¶7} Within a few weeks, an audit of the Canteen’s finances was
completed. However, the remaining two conditions were never performed.
Neither Karen nor Post 401 resumed formal discussions on the issue of Karen’s
reinstatement as Canteen Manager. On December 8, 2007, the Executive
Committee held a meeting and voted to eliminate the full-time position of Canteen
Manager.
{¶8} On January 31, 2008, Karen filed this suit alleging that she was
wrongfully terminated from her position as Canteen Manager without just cause.1
Specifically, the complaint alleged that the Executive Committee committed an
1
We note that in the original action, Karen’s complaint also named members of the Executive Committee
in their individual capacity as defendants. However, at oral argument Karen’s counsel conceded that
summary judgment as to the individual members was appropriate, thus on appeal, we will only review the
grant of summary judgment as to the entity, Post 401.
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ultra vires2 act in violation of its own bylaws when it held an unscheduled meeting
with less than half of the Executive Committee in attendance, and voted to
terminate Karen. Post 401 timely filed its answer denying Karen’s allegations. In
the interim, several witnesses were deposed including Karen and members of the
Executive Committee who were involved with and/or had personal knowledge of
the decision to terminate Karen.
{¶9} On December 10, 2008, Post 401 filed a motion for summary
judgment arguing that, because no written employment contract existed, Karen
was an employee at-will and Post 401 could terminate her without cause. Post 401
further argued that none of the exceptions to the employment at-will doctrine
applied to this case and therefore, it was entitled to judgment as a matter of law.
{¶10} On April 7, 2009, Karen filed her response to Post 401’s motion for
summary judgment maintaining her position that her termination was effectuated
in violation of Post 401’s bylaws. Karen further contended that she was never
formally terminated because the decision to release her as Canteen Manager was
made at an unauthorized meeting. Karen also asserted—for the first time—in her
memorandum contra to summary judgment that the Executive Committee made
specific promises to her at the time of her hiring in 2000. Karen argued that these
promises placed her employment relationship with Post 401 squarely into
2
An act of a corporation is ultra vires when it is beyond the chartered powers of the corporation, and is
therefore said to be void.
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recognized exceptions to the employment at-will doctrine—specifically the
exceptions which rest on the existence of promissory estoppel and implied
contractual provisions. See Mers v. Dispatch Printing Co. (1985), 19 Ohio St.3d
100, 483 N.E.2d 150, paragraphs two and three of the syllabus.
{¶11} In support of this contention, Karen stated in an affidavit attached to
her response to Post 401’s motion for summary judgment that: 1) upon her hiring
as Canteen Manager, the Executive Committee negotiated with Karen to leave her
job at GTE and agreed to match the salary that she earned there; 2) the Executive
Committee also gave Karen the further assurance that she would retain her job so
long as she continued to fulfill her job duties.
{¶12} Notably, Karen failed to mention these promises in her earlier
deposition. Furthermore, none of the Post 401 members who made the alleged
promises to Karen at her hiring in 2000 were deposed. Therefore, Karen’s
affidavit submitted in opposition to summary judgment is the only evidence in the
record regarding these alleged promises.
{¶13} On September 14, 2009, the trial court granted Post 401’s motion for
summary judgment finding that based on the undisputed facts none of the
exceptions to at-will employment doctrine applied. Furthermore, the trial court
summarily dismissed Karen’s affidavit as self-serving and characterized it as an
attempt to raise an issue of fact simply to oppose summary judgment.
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{¶14} Karen now appeals to this Court, asserting a single assignment of
error.
THE TRIAL COURT ERRED IN GRANTING SUMMARY
JUDGMENT WHEN THE DEPOSITIONS AND AFFIDAVITS
ALL SUPPORT THE MATERIAL FACTS TO BE
LITIGATED
{¶15} In her sole assignment of error, Karen argues that the trial court
erred in granting summary judgment in favor Post 401 because genuine issues of
material fact remain as to whether exceptions to the employment at-will doctrine
are applicable to her case. In support of this contention, Karen directs our review
to her deposition and her subsequent affidavit.
The Effect of Karen’s Affidavit
{¶16} As an initial matter, we first must determine the effect of Karen’s
affidavit which was submitted in opposition to Post 401’s motion for summary
judgment, and appears to be inconsistent with her deposition. In order to make
this determination, it is necessary to consider whether Karen’s affidavit contradicts
or merely supplements her former deposition. Byrd v. Smith, 110 Ohio St.3d 24,
29-30, 2006-Ohio-3455, N.E.2d 47.
{¶17} Nearly nine months elapsed between Karen’s deposition and the
submission of the affidavit accompanying her memorandum contra to 401’s
motion for summary judgment. During this time period, the record bears no
indication of the existence of the alleged promises contained in her affidavit.
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However, in her affidavit Karen for the first time alluded to the following
promises that Post 401 made when they hired her:
***
3. In order for me to leave my 22 years of employment with GTE
and all the job security and benefits I received, I advised the Executive
Committee of Post 401 that I need a salary consistent with what I made
at GTE.
4. The Executive Committee agreed to match my GTE salary and
promised I would have a job as Canteen Manager as long as I fulfilled
my job description.
***
(Affidavit, p.1)
{¶18} In order to assess whether Karen’s affidavit contradicts or merely
supplements her deposition, we must review Karen’s deposition to determine
whether she was given the opportunity by opposing counsel to discuss these
alleged promises on the record. The following are excerpts from Karen’s
deposition that are relevant to this inquiry:
Q: And how long did you continue to work for GTE?
A: Until May of 2000.
Q: What happened then?
A: The Legion offered me a canteen manager position and I left the
phone company.
Q: So when was it that you went to work for the Legion? When we say
the Legion, we’re talking about Post 401 Caledonia, the Defendant?
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A: Right. I started bartending there in about late October or
November of ’99.
Q: That’s when you were still at GTE?
A: Yes.
Q: And how long did you continue bartending?
A: Until October the 8th, 19—or this is 2008, 2007.
Q: Now, I believe at some point in time you became I believe you said
the canteen manager?
A: They offered me the job bartending in October or November and
then—
Q: ’99?
A: In ’99. And then in the Spring of 2000, they offered me the canteen
manager’s job.
Q: Which you accepted?
A: Yes, I did.
(Depo. p. 8-9).
***
Q: Now, you’ve alleged in your Complaint that you were wrongfully
terminated. Is that they wrongfully terminated your employment?
A: Yes.
Q: Why do you feel that you were wrongfully terminated?
A: As long as I’ve been at the Legion and I understand their meeting
dates, I know that you cannot conduct any Legion business outside of
your dates, your meeting dates. So I knew that they had an illegal
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meeting. They had never said anything to me about I was causing a
problem or there was a problem. I have never to this date been told
why I was terminated other than my services were no longer needed.
Q: So are you saying that you believe that you were wrongfully
terminated because there was an illegal meeting in your opinion?
A: In my opinion, yes, without just cause.
Q: And you feel you were terminated without just cause, is that what
you are saying?
A: Yes.
Q: Any other reason why you think your termination was illegal?
A: Well, I don’t know any other reason than—I don’t think it was
right.
(Depo., p. 23-24).
***
Q: Okay. Now, I’m going to take you back to 2000 for a moment when
you were hired as canteen manager. Do you recall who—was there an
individual who specifically told you you were hired?
A: No. There were three.
Q: Okay. There were three? This wasn’t the whole Board, this was
three?
A: This was three members.
Q: Do you recall who those three were?
A: Tom Hetzel, Bill Berry and Perry Worcester interviewed me.
Q: They were the ones that said you were hired at one point?
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A: It might have been Tom that told me, but they pretty much told me
that night I was.
Q: Were there any—was there anything written in black and white on
a piece of paper, any terms and conditions of your employment when
you were hired?
A: Meaning?
Q: Did they say other than a job description, you had a job description
you said, if you recall correctly?
A: Yeah, they gave me a job description.
Q: Other than a job description, was the hiring of you and the terms
and conditions that hiring all verbal?
A: I don’t know that I signed a contract. I might have. I don’t know.
Q: You’re not aware of any?
A: No. Can I say something? That when they hired me, that was
strictly as a bartender then.
Q: I’m talking about when you were hired as canteen manager?
A: There was no contract. They just gave me a list of canteen manager
duties.
Q: Okay. And they told you your rate of pay would be different?
A: No, I still got $450 a week or that’s what I would be getting because
I was on hourly, yes. I was on hourly before until canteen manager.
Q: Did they when they hired you as Canteen Manager, did anyone tell
you anything else that you haven’t disclosed to us about any specific
terms or conditions of your employment?
A: As far as?
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Q: Anything about your employment?
A: My hours?
Q: Anything about your employment. You got your job description,
you got your rate of pay, go do your job, anything else?
A: Other than I did some payroll.
Q: I’m talking about did they tell you anything else?
A: The only thing I was ever told was that I would receive a check for
partial payment and the rest would be cash.
Q: A check for partial payment? I lost you on that one I don’t
understand.
A: Well, they paid me my salary was $453 a week of which they would
issue me a check for $250 which they would take taxes out of and I
would out of our gambling monies I was to pay myself $200 and
reimburse myself the $53 that they took out of the check for taxes
which I made $453.
Q: Okay. Anything else?
A: I’m not sure what you are looking for.
Q: I’m not looking for anything. I just want to know what you know.
A: Other than my canteen duties and how to do the pay, I don’t know.
I don’t think there was anything else
(Depo., p. 34-38).
{¶19} In reviewing Karen’s deposition in its entirety, we believe that the
questioning of opposing counsel provided Karen with ample opportunity to
disclose the existence of the promises later alleged in her affidavit to have taken
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place at the time of her hiring as Canteen Manager. Karen was repeatedly asked
about the specific terms and conditions of her employment in addition to being
asked specific questions concerning the precise circumstances of her hiring as
Canteen Manager in 2000. In response to these questions, Karen proved that she
was able to sharply recall the acute details of her hiring eight years prior.
However, Karen failed to disclose any of the key promises which she now alleges
induced her to leave the benefits and security of a job that she held for 22 years.
{¶20} Other than the statements contained in Karen’s affidavit, there is no
evidence in the record of the existence of these promises. Moreover, prior to Post
401 moving for summary judgment, Karen’s counsel deposed members of the
Executive Committee who were involved in the decision to terminate Karen at the
unauthorized meeting. In reviewing these depositions, there are no references—
either in the questioning or in the responses of the Executive Committee
Members—to any promises made to Karen concerning her employment. Further,
the record supports some evidence that Tom Hetzel, a member of the Executive
Committee who Karen stated was integral in her hiring, remained an active
member of the Executive Committee at the time of this lawsuit. Despite his
apparent personal knowledge of the details of Karen’s hiring in 2000, Tom Hetzel
was not deposed by Karen’s counsel as part of this litigation.
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{¶21} Nevertheless, Karen now asserts that the promises contained in her
affidavit create a genuine issue of material fact notwithstanding the lack of
evidence to substantiate the existence of the alleged promises prior to Post 401
filing its motion for summary judgment. However, based on the foregoing
analysis, we conclude that Karen’s affidavit contradicts rather than merely
supplements her deposition.
{¶22} In Byrd v. Smith, the Supreme Court of Ohio devised a framework to
examine the effect of an affidavit submitted by a non-moving party in opposition
of summary judgment which contradicts their own prior deposition:
If an affidavit appears to be inconsistent with a deposition, the
court must look to any explanation for the inconsistency.
***
Ordinarily, under [Civ.R.] 56(C), when an affidavit is
inconsistent with affiant's prior deposition testimony as to
material facts and the affidavit neither suggests affiant was
confused at the deposition nor offers a reason for the
contradictions in her prior testimony, the affidavit does not
create a genuine issue of fact which would preclude summary
judgment. We hold that an affidavit of a party opposing
summary judgment that contradicts former deposition
testimony of that party may not, without sufficient explanation,
create a genuine issue of material fact to defeat a motion for
summary judgment.
Byrd, Ohio St.3d at 30, 850 N.E.2d 47. (Internal citations omitted).
{¶23} Upon reviewing Karen’s affidavit within this framework, it is
apparent that the inconsistency between her deposition and affidavit involves
material facts essential to Karen’s assertion that this case falls within the
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promissory estoppel and implied contract exceptions to the employment at-will
doctrine. However, noticeably absent from the affidavit is any explanation for the
inconsistency or any suggestion that Karen was confused at the time of deposition.
Indeed, Karen offers no explanation for why the existence of these alleged
promises was not addressed prior to submitting the affidavit in opposition of
summary judgment.
{¶24} According to the foregoing law, without sufficient explanation for
the inconsistency between her former deposition and her affidavit, Karen’s
affidavit cannot be offered to establish a genuine issue of material fact. Therefore,
we must exclude the inconsistent statements averred in Karen’s affidavit from our
review of the trial court’s decision to grant summary judgment in favor of Post
401.
Post 401’s Motion for Summary Judgment
{¶25} An appellate court reviews a grant of summary judgment
independently, without any deference to the trial court. Conley-Slowinski v.
Superior Spinning & Stamping Co. (1998), 128 Ohio App.3d 360, 363, 714
N.E.2d 991. The standard of review for a grant of summary judgment is de novo.
Hasenfratz v. Warnement, 3rd Dist. No. 1-06-03, 2006 Ohio 2797, citing Lorain
Nat’l. Bank v. Saratoga Apts. (1989), 61 Ohio App.3d 127, 572 N.E.2d 198. A
grant of summary judgment will be affirmed only when the requirements of Civ.R.
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56(C) are met. This requires the moving party to establish: (1) that there are no
genuine issues of material fact, (2) that the moving party is entitled to judgment as
a matter of law, and (3) that reasonable minds can come to but one conclusion and
that conclusion is adverse to the non-moving party, said party being entitled to
have the evidence construed most strongly in his favor. Civ.R. 56(C); see Horton
v. Harwick Chem. Corp. (1995), 73 Ohio St.3d 679, 653 N.E.2d 1196, paragraph
three of the syllabus.
{¶26} The party moving for summary judgment bears the initial burden of
identifying the basis for its motion in order to allow the opposing party a
“meaningful opportunity to respond.” Mitseff v. Wheeler (1988), 38 Ohio St.3d
112, 116, 526 N.E.2d 798. The moving party also bears the burden of
demonstrating the absence of a genuine issue of material fact as to an essential
element of the case. Dresher v. Burt (1996), 75 Ohio St.3d 280, 292, 662 N.E.2d
264. Once the moving party demonstrates that he is entitled to summary
judgment, the burden shifts to the non-moving party to produce evidence on any
issue which that party bears the burden of production at trial. See Civ.R. 56(E).
In ruling on a summary judgment motion, a court is not permitted to weigh
evidence or choose among reasonable inferences, rather, the court must evaluate
evidence, taking all permissible inferences and resolving questions of credibility in
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favor of the non-moving party. Jacobs v. Racevskis (1995), 105 Ohio App.3d 1, 7,
663 N.E.2d 653.
A. Implied Contract and Promissory Estoppel
{¶27} Generally, in an at-will-employment relationship, the employer may
discharge the employee at any time, even without cause, so long as the reason for
the discharge is not contrary to law. Wright v. Honda of Am. Mfg., Inc., 73 Ohio
St.3d 571, 574, 653 N.E.2d 381, 1995-Ohio-114. See also Mers v. Dispatch
Printing Co. (1985), 19 Ohio St.3d 100, 483 N.E.2d 150, paragraph one of the
syllabus (“[E]ither party to an oral employment-at-will agreement may terminate
the employment relationship for any reason which is not contrary to law.”).
{¶28} In the present case, Karen maintains that she was not an employee
at-will and relies on two exceptions to the employment-at-will doctrine in support
of this contention: (1) where the employer has made a promise from which the
employee can prove promissory estoppel, and (2) where the facts and
circumstances surrounding the employment demonstrate the existence of explicit
or implicit contractual terms concerning discharge. Wright at 574, 653 N.E.2d
381; Kelly v. Georgia-Pacific Corp. (1989), 46 Ohio St.3d 134, 545 N.E.2d 1244,
paragraphs two and three of the syllabus; Mers, paragraphs two and three of the
syllabus.
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{¶29} In reviewing the record, the alleged promises contained in Karen’s
affidavit are the only factual basis upon which Karen relies to make the assertion
that her employment with Post 401 meets these exceptions. Having found that the
statements averred in her affidavit contradict her former deposition without
explanation and do not establish an issue of material fact, we cannot find any other
factual basis in the record to support Karen’s claim of promissory estoppel or the
existence of an implied contract. Accordingly, we find that the trial court properly
granted summary judgment as to these claims.
B. Ultra Vires
{¶30} As the primary basis for her wrongful termination claim, Karen
maintains that Post 401 committed an ultra vires act because the decision to
terminate her was effectuated at an unauthorized meeting held in violation of Post
401 bylaws. At common law, the term ultra vires was used to describe an act of a
corporation that was done either in excess of authorized power or performed in an
unauthorized manner. The Ohio Legislature promulgated a series of statutes
which supplant the common law ultra vires doctrine with regard to the authority of
non-profit corporation, such as Post 401. See R.C. 1702.12.
{¶31} Section 1702.12(I)(1) of the Revised Code delineates those who
have standing to assert an ultra vires action against a corporation and provides, in
pertinent part:
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No lack of, or limitation upon, the authority of a corporation
shall be asserted in any action except as follows:
(a) By the state in an action by it against the corporation;
(b) By or on behalf of the corporation against a director, an
officer, or a member as such;
(c) By a member as such or by or on behalf of the members
against the corporation, a director, an officer, or a member as
such.
{¶32} Initially, Karen made no assertion that she was a member of Post
401 and cited no authority providing that she had standing to bring an ultra vires
action against Post 401. Furthermore, even if Karen were a social member of the
club,3 her complaint of wrongful termination is not the kind of action
contemplated by the ultra vires doctrine. See R.C. 1702.02(H) (enumerating the
type of prohibited corporate actions which cause injury to the corporation or
injury to an individual’s membership to the corporation as a result of the
unauthorized conduct); See also Moore v. Christ’s Christian Fellowship Church,
Inc., 172 Ohio App.3d 398, 2007-Ohio-3095, 875 N.E. 121; Rhea v. Miami Valley
Child Development Center, Inc. (1980), 2nd Dist. No. 6642. Here, Karen sues for
injury based on an employment-at will relationship wherein she alleges to suffer
personal harm as a result of being wrongfully terminated, not of an injury suffered
by the corporation or by reason of some derivative membership interest.
3
American Legion membership is strictly reserved for veterans of the U.S. Armed Forces and there is no
evidence in the record that Karen satisfies this requirement.
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{¶33} Moreover, in support of her claim that her termination was in
violation of Post 401’s bylaws, Karen cites the provisions in Post 401’s
constitution which simply dictate the manner in which Post 401’s administrative
meetings are held. However, nowhere in her pleadings does Karen cite any rules
of the corporation which govern employment relations as evidence that Karen’s
termination itself was in violation of Post 401’s bylaws. Therefore, we find
Karen’s claim that her termination was an ultra vires act to be without merit.
{¶34} Furthermore, notwithstanding her claim that an ultra vires action
occurred, the Executive Committee conceded that the initial meeting resulting in
Karen’s termination was improper. As such, the Executive Committee voted to
reinstate Karen and scheduled a meeting with her to inform her of the mistake.
Based on this concession, Karen also maintains that she was never formally
terminated and remains ready able and willing to return to her position as Canteen
Manager. However, Karen’s assertion that she was never terminated is
problematic. As stated in her deposition, Karen told the Executive Committee that
she would consider its offer to reinstate her as Canteen Manager if certain
additional terms were met. Karen further told the Executive Committee that even
if those terms were met, she would still need time to consider returning to her
position as Canteen Manager.
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{¶35} Simply put, instead of accepting the offer to return to her position as
Canteen Manager, Karen required that additional terms be met in order for her to
consider returning to the position, effectively making a counter-offer. Post 401
failed to meet those terms, neither party attempted to resume negotiations and the
position of Canteen Manager was eliminated. Based on the foregoing sequence of
events, it is apparent that even if Karen was not properly terminated, she, at the
very least, refused Post 401’s original offer to return to her position as Canteen
Manager. Therefore, we find that the parties reached a final resolution on the
matter of Karen’s employment as Canteen Manager. Accordingly, having found
no existence of a genuine issue of material fact, we conclude that trial court’s
grant of summary judgment as to this claim was appropriate. 4
{¶36} For all the reasons stated above, Karen’s assignment of error is
overruled and the judgment of the Marion County Court of Common Pleas
granting summary judgment in favor of Post 401 is affirmed.
Judgment Affirmed
WILLAMOWSKI, P.J. and PRESTON, J., concur.
/jnc
4
We further note that Karen raises an additional argument that her termination was in violation of public
policy. However, this argument was raised for the first time on appeal and was not before the trial court.
Karen does not assert a legitimate factual basis for this exception to the employment at-will doctrine but
simply makes bald assertions that she was “maliciously discharged.” Upon our review of the record, we
find no merit to this claim especially in light of the fact that Post 401 offered to reinstate Karen as Canteen
Manager, which she subsequently refused unless certain requirements were met.
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