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HomeMy WebLinkAbout91-3100 CivilLEE BARNES, IN THE COURT OF CO Plaintiff CUMBERLAND COUNTY, V• CIVIL ACTION - LAW RURAL OPPORTUNITIES, INC.: d/b/a PENNSYLVANIA NO. 3100 CIVIL 1991 FARMWORKER OPPORTUNITIES,: Defendant BEFORE SHEELY, P.J. and OLER, J. ORDER OF COURT AND NOW, this 16f4day of July, 1992, upon cons Defendant's Preliminary Objections to the Plaint ON PLEAS OF ENNSYLVANIA and of the briefs and oral arguments presented in t Defendant's Preliminary Objections are DISMISSED. granted twenty days within which to file an answer. BY THE COURT, Elliot A. Strokoff, Esq. Cathi L. Radner, Esq. 132 State Street P.O. Box 11903 Harrisburg, PA 17108 Counsel for Plaintiff Karen S. Feuchtenberger, Esq. 305 N. Front Street P.O. Box 1003 Harrisburg, PA 17108-1003 Counsel for Defendant ration of the f's Complaint, he matter, the Defendant is J. LEE BARNES, IN THE COURT OF CO N PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA V. CIVIL ACTION - LAW RURAL OPPORTUNITIES, INC.: d/b/a PENNSYLVANIA NO. 3100 CIVIL 1991 FARMWORKER OPPORTUNITIES,: Defendant BEFORE SHEELY, P.J., and OLER, J. OPINION AND ORDER OF COURT At issue in the present case are preliminary objections to a complaint alleging wrongful discharge filed by Lee Barnes (Plaintiff) against Rural Opportunities, Inc. d/ /a Pennsylvania Farmworker Opportunities (Defendant). The factua allegations in the Plaintiff's complaint are as follows:' The Defendant is a private corporation with a divisional office located in Camp Hill, Pennsylvania, and at all times relevant hereto received various grants and sub idies from the Commonwealth of Pennsylvania to be used for spe ific programs.' The Plaintiff was employed, on an at -will basis, by the Defendant as a "housing developer" from February of 1988 til October of 1989.3 The Plaintiff alleges that he received a memorandum in early April of 1989 from his immediate supervisor which instructed him to 1 By its summary of the facts as stated in Plaintiff's complaint, the Court is in no way expressing a belief as to whether the allegations are true or untrue. ' Plaintiff's Complaint, paragraphs 2, 4. 3 Plaintiff's Complaint, paragraph 3. No. 3100 Civil 1991 "create client files first thing next week on FmHA clients. ,4 (Emphasis in original.) The Plaintiff told the supervisor that fabrication of such files would mislead state auditors and be illegal, and that, if asked, he would inform the a ditors that the files were not genuine and that the clients did not receive the services documented therein.' Subsequent to this conversation, the Plaintiff contends, the supervisor gave him unreasonable work assignments and pursued a program to discredit his job performance in order to create a pretext for terminating his employment.' The Plaintiff further avers that he made repeated demands, subsequent to his dismissal,' upon the Defendant requesting that it thoroughly investigate his allegation that he was fired solely because he refused to create the allegedly illegal files, and that the Defendant failed to conduct such an investigation.' Thereafter, the Plaintiff commenced the presnt civil action seeking compensatory damages incurred as a result f his dismissal, 4 The Plaintiff also states that the supery with instructions on how to fabricate such fil Complaint, paragraph 6. ' Plaintiff's Complaint, paragraph 7. 6 Plaintiff's Complaint, paragraph 8. ' The Defendant terminated the Plaintiff's of a letter, dated September 28, 1989. Plain paragraph 9. ' Plaintiff's Complaint, paragraph 11. 2 isor provided him es. Plaintiff's employment by way tiff's Complaint, No. 3100 Civil 1991 and punitive damages.' Preliminary objections have been filed to the Plaintiff's complaint by Defendant. These objections consist of (a) a demurrer, or in the alternative a motion to strike off the complaint, based on Plaintiff's alleged failure to utilize an exclusive statutory remedy, (b) a demurrer based on the alleged absence of the requisite elements of wrongful discharge, and (c) motions to strike off certain portions of the comp aint relating to damages.10 For the reasons stated in this opinion, we dismiss the preliminary objections. "The question presented by a demurrer is whether, on the facts averred in the complaint, the law says with c rtainty that no recovery is possible." Vattimo v. Lower Bucks Ho pital, Inc., 502 Pa. 241, 244, 465 A.2d 1231, 1232 (1983). Moreover, "[a]ny doubts as to whether a demurrer should be sustained should be resolved against the moving party." David v. Commonwealth, Pa. Comm. , 598 A.2d 642, 647 (1991). Thus, in ruling on a preliminary objection in the form of a demurrer, the court may sustain the demurrer only if it finds that "a cause of actin [has not been] ' Plaintiff's Complaint, paragraph 12 and �d damnum clause. 10 It may be noted that the Defendant's preliminary objections were filed pursuant to Pa. R. C.P. 1017(b), wh`ch was rescinded effective January 1, 1992; however, the preliminary objections will be considered under Pa. R.C.P. 1028(a), which aas been amended, effective January 1, 1992, to include the grounds upon which preliminary objections may be based. See Pa R.C.P. 1017(b), 1028(a), 126. 3 No. 3100 Civil 1991 properly made out in the complaint; and ... the plaintiff would be unable to state a proper claim even on a differ nt statement of facts." Nagy v. The Bell Telephone Company of P nnsylvania, 292 Pa. Super. 24, 27, 436 A.2d 701, 703 (1989) . With these principles in mind, we turn to the Defendant's objections in the instant case. With respect to the objection in the form of a demurrer, or, in the alternative, a motion to strike off the co plaint, based on Plaintiff's alleged failure to utilize an exc usive statutory remedy, it is argued that the claim asserted alls within the purview of Pennsylvania's Whistleblower Law." In this regard, the statute provides in pertinent part as follows: No employer may discharge, threaten or otherwise discriminate or retaliate against an employee ... because the employee or a person acting on behalf of the employee makes a good faith report or is about to report verb lly or in writing, to the employer or appropriate authority an instance of wrongdoing or waste .12 Under this act, an employee is defined as "[a] person who performs a service for wages or other remuneration under a'contract of hire, written or oral, express or implied, for a public body."13 A public body is defined in pertinent part as "[']ny ... body ... seq. 11 Act of December 12, 1986, P.L. 1559, 43 �a. C.S. §§1421 et 12 Id., 43 Pa. C.S. §1423(a). 13 Id., 43 Pa. C.S. §1422. 4 No. 3100 Civil 1991 which is funded in any amount by or through the Commonwealth ...��;la the term "funded," however, is not defined in the statute. In Pennsylvania, a plaintiff pursuing a co on law cause of action for wrongful discharge may do so "'only in the absence of a statutory remedy ...."' Darlington v. General E ectric, 350 Pa. Super. 183, 208, 504 A.2d 306, 318 (1986), quoting Rettinger v. American Can Co., 574 F. Supp. 306, 311 (M.D. Pa. 983). Thus, the dispositive question with regard to the Defendant's first preliminary objection is whether Plaintiff's cla m for relief is clearly within the preemptive scope of the Whistleblower Law. In this regard, it is undisputed that the D fendant received monies from the Commonwealth to assist in implementing its programs. However, on the issue of whether the Defendant must therefore be considered to be a public body for, purposes of the Whistleblower Law, the decision of the United Stat es District Court for the Eastern District of Pennsylvania in Cohen v. Salick Health Care, Inc., 772 F. Supp. 1521 (E.D. Pa. 1991), is instructive." In Cohen, the plaintiff alleged that the defendant 16 14 id. 15 See generally Smith v. Calgon Carbon Coxp., 917 F.2d 1338 (3d Cir. 1990) (where state's highest court h s not considered precise question facing the court, federal cou t is required to predict how the state court would resolve the i sue.) 16 The defendant was a for-profit corporation created under the laws of California. Cohen v. Salick Health are, Inc., 772 F. Supp. 1521, 1523 (E.D. Pa. 1991). 5 No. 3100 Civil 1991 "wrongfully terminated her employment in reta protesting against and threatening to report t on the part of [the defendant] to Temple Universi tion for her wrongdoing["] ..., with whom [the defendant] contracted to operate and manage a Comprehensive Cancer Center in North Philadelphia," and in ding so violated Pennsylvania's Whistleblower statute. Id. at 1523. The plaintiff's allegation that the defendant violated the statute by terminating her employment was premised on the fact that the defendant was "'funded by or through' the Commonwealth of Pennsylvania and [was] therefore a 'public body' by virtue of its receipt of Medicaid reimbursements from the Co onwealth through Temple, in payment for services rendered to Medicaid eligible patients." Id. at 1526. In granting the defen ant's motion for summary judgment, the court held as follows: It is abundantly clear that the [Pennsy vania] Legislature did not intend that tha mere receipt of monies from a state sou ce for services rendered should bring the recipient within the Whistleblower Law.... The 1 nguage 'funded in any amount by or Lhrough Commonwealth or political subdivision authority' was intended by the Legislature to be limited to monies which were appropriated [17] The wrongdoing in Cohen consisted of a report containing inflated patient load projections which was alle edly prepared "to make the cancer center a more attractive proposal to Temple." Cohen v. Salick Health Care, Inc., 772 F. Supp. 1521, 1524 (E.D. Pa. 1991). The plaintiff was allegedly terminated after she informed a Temple representative, the President and the Director of Human Resources for the Defendant of the existence of the spurious report. Id. at 1524. L No. 3100 Civil 1991 by the Legislature.... This languag was obviously not intended to make an individual or corporation a 'public body' solely cn the basis that monies were received by it from the state as reimbursement for services renc lered. Id. at 1527. II On the basis of the foregoing, we are not iS a Position, at this stage of the pleadings, to conclude with 11 certainty that Defendant is a public body for purposes of the Wlistleblower Law and that Plaintiff's action as pled is therefore foreclosed. � Defendant's first preliminary objection, premise Ilupon a contrary pose, 'tion must for this reason be dismissed. With respect to the Defendant's preliminary Ibjection, in the form of a demurrer, based upon the alleged absence of the requisite elements of wrongful discharge, it may be Illnoted that in Pennsylvania a plaintiff pursuing a common law caIlse of action for wrongful discharge may do so "only when imp rtant and well recognized facets of public policy (are) at stakelDarlington v. General Electric, 350 Pa. Super. 183, 208, 5 II�4 A.2d 306, 318 (1986), quoting Rettinger v. American Can Co., 74 F. Supp. 306, 311 (M.D. Pa. 1983). A brief historical overv'lew of the law in this area will be helpful. ll to The classic statement of Pennsylvania's ep Yment at -will doctrine was expressed in Henry v. Pittsb. Etc VIII R. Co., 139 Pa. 289, 21 A. 157 (1891), wherein the plaintiff, a Lticket agent, was discharged during the course of an investigation nto embezzlement. 7 No. 3100 Civil 1991 Although the plaintiff was subsequently cleared of any wrongdoing, a nonsuit in favor of the defendant was granted by the trial court. Id. at 293, 21 A. at 157. The Pennsylvania Supreme Court affirmed the nonsuit, holding that an employer "may discharge an employee with or without cause, at pleasure, unless restrained by some contract; ... questions of malice and probable cause have [nothing] to do with the case." Id. at 297, 21 A. at 157 The principle expressed in Henry was followed until the Penn ylvania Supreme Court indicated a willingness to restrict the em loyment at -will doctrine in Geary v. United States Steel Corporation, 456 Pa. 171, 319 A.2d 174 (1974). In Geary, the plaintiff, an at -will employeel was fired after expressing his belief to his superiors that a product manufactured by the defendant "had not been adequately tested ind constituted a serious danger to anyone who used it." Id. at 173, 319 A.2d at 175. Subsequent to his dismissal, Geary brought a suit alleging wrongful discharge, which was dismissed by the trial court on a demurrer. Id. at 174, 319 A.2d at 175. In affir 'ng the demurrer, the Pennsylvania Supreme Court noted that 11[n]o court in [the] Commonwealth [has] ever recognized a non-statuto Y cause of action for an employer's termination of an at will employment relationship." Id. at 174, 319 A.2d at 175. The Court went on to indicate, however, that economic conditiolls had changed dramatically since the Henry decision, and th�t an action for 0 No. 3100 Civil 1991 wrongful discharge might exist, but only when a clear mandate of public policy was violated and where the comp aint failed to disclose a plausible and legitimate reason for ter inating the at - will relationship. Id. at 184-185, 319 A.2d at 179-180. A number of Pennsylvania courts have sine found a non - statutory cause of action for wrongful dischar a based on the public policy rationale expressed in Geary.18 Although "[t]he precise extent to which [an] employer's interes in running his business [will be] limited by considerations of public policy ... must be worked out on a case-by-case basis,i' the following general statement has been made: [A] discharge may violate a 'clear mandate of public policy' if it results from conduct on the part of the employee that is required by law or from the employee's refusal to engage in conduct prohibited by law. 'The public 18 See, e.g., Hunter v. Port Authority of Alleghe y Cunty, 277 Pa. Super. 4, 419 A.2d 631 (1980) (public employer , s refusal of employment to former criminal offender who ha been pardoned); Reuther v. Fowler & Williams, Inc., 255 Pa. Super 28, 386 A.2d 119 (1978) (discharge of employee for acceptance of jury duty); Perks v. Firestone Tire & Rubber Co., 611 F.2d 1363 (3d. Cir. 1979) (applying Pennsylvania law) (dismissal of employe for refusal to take polygraph test). 19 Yaindl v. Ingersoll-Rand Company Standard Pump Aldrich Division, 281 Pa. Super. 560, 572, 422 A.2d 611, 617 (1980). One legal commentator has noted that courts have applied the public policy exception to discharges involving three categ,ries of motives. Broadly stated, these categories are discharges esulting from the employee's refusal to commit an unlawful act; resulting from the employee's performing an important public obligation; or resulting from the employee exercising a statutory right. See Note, Protecting Employees At Will Against Wrongful Dis harge: The Public Policy Exception, 96 Harv. L. Rev. 1931, 1936 (4983). 01 No. 3100 Civil 1991 policy exception has been most freq,ently applied under Pennsylvania law whed the discharge is a result of the employee's compliance with or refusal to violate the law.' Smith v. Calgon Carbon Corp., 917 F.2d 1338, 1344 (3d Cir. 1990). "[E]ven when an important public policy is involved, an employer may discharge an employee if he has separate' plausible and legitimate reasons for doing so.i20 Cisco v United Parcel Services, Inc., 328 Pa. Super. 300, 306, 476 .2d 1340, 1343 (1984). An employee pursuing a cause of action for wrongful discharge under the public policy exception must identify the public policy violated by the discharge at the pleading stage. Betts v. Stroehmann Brothers, 355 Pa. Super. 195, 199-200, 512 A.2d 1280, 1282 (1986). To survive a defendant's demurrer, 'a plaintiff must provide either a factual account of the discharge which could be construed as implicating public policy interests or the statutory, regulatory or other governmental policy interest affected by the discharge. See Mudd v. Hoffman Homes For Yout , Inc., 374 Pa. 20 Pennsylvania courts have found that employers had separate, plausible and legitimate reasons for termination 'here an employee was discharged because she bypassed immediate supervisors and presented her views to higher officials, Mudd v. Hoffman Homes For Youth, Inc., 374 Pa. Super. 522, 543 A.2d 1092 (1988) , and where an employer sought to protect its reputation by discharging an employee who was accused of theft and trespass in connection with his employment, even though a jury ultimately acq fitted him. Cisco v. United Parcel Services, Inc., 328 Pa. Super. J00, 476 A.2d 1340 (1984). 10 No. 3100 Civil 1991 Super. 522, 527, 543 A.2d 1092, 1095 (1988) McCortney v. Meadowview Manor, Inc., 353 Pa. Super. 34, 36, 508 A.2d 1254, 1265 (1986). Turning to the facts in the present case, we are reminded that [a] demurrer by a defendant admits all relevant facts sufficiently pleaded in the complaint, and all inferences fairly deducible therefrom, but not conclusions of law or unjustified inferences." Commonwealth v. David, Pa. Commw. , 598 A.2d 642, 647 (1991). So viewed, the factual averments presented in the Plaintiff's complaint arguably implicate and identify interests sought to be protected by the public policy exception, those interests being prevention of fraud and misappropriation of state funds. Additionally, no separate, plausible or l gitimate reasons for the Plaintiff's termination appear on t e face of the complaint. At this stage of the pleadings, it cannot be said with certainty that as a matter of law no recover is possible on Plaintiff's claim for wrongful discharge. Defendant's second preliminary objection must therefore be dismissed. With respect to the Defendant's preliminary objections in the form of motions to strike off portions of the comrilaint relating to damages, it is argued that punitive damages are not recoverable under the facts alleged in Plaintiff's complaint, that a specific damage figure should not have been pled, and that a compulsory arbitration reference should have been included in the pleading. 11 No. 3100 Civil 1991 These matters will be discussed seriatim. The argument that punitive damages are not i vailable in the present context is to be reviewed in accordance w' h the standards applicable to evaluation of a demurrer. 21 Th question thus presented is whether it can be said with certaintylthat no recovery for punitive damages is possible under the fac is averred, all doubts being resolved in favor of the Plaintiff. IIII Our Supreme Court has held that an award of punitive damages is proper "when a person's actions are of such an I�utrageous nature as to demonstrate intentional, willful, wan �on or reckless conduct." SHV Coal Inc. v. Continental Coal Co., 1126 Pa. 489, 493, ll 587 A.2d 702, 704 (1991). In addition, the UniteStates District Court for the Eastern District of Pennsylvania h s concluded that in appropriate circumstances a wrongful disc arge claim will support a punitive damage award under P nnsylvania law. Elbeshbeshy v. The Franklin Institute, 618 F. Sur 170, 172 (E.D. Pa. 1985). In the present case, the Plaintiff has alleg d that he refused to actively participate in conduct regarded as fraudulent and 21 "An objection that a complaint does not set iforth a claim on which punitive damages can be allowed does not ilaise a ground for a preliminary objection in the form of a motion1to strike off the complaint under Rule 1017(b)(2), since such an objection does not claim that the complaint did not conform to law or a rule of court or that the complaint contained scandalous or impertinent matter. Such an objection should more properly be raised inder a demurrer." 2 Goodrich-Amram 2d §1017(b):18, at 262 (1977).; 12 No. 3100 Civil 1991 illegal, and that his employment was terminated as a result thereof. On the basis of the foregoing authority, it cannot be said with certainty that the employer's conduct c uld not support an award of punitive damages. The argument that a specific damage figure should not have been pled in the complaint apparently arises oul of Plaintiff's averment of wage loss "in excess of eighteenhousand dollars ($18,000),"22 his averment of unliquidated damages "in excess of ten thousand dollars ($10,000),i23 and his resultant in claim I for relief in the ad damnun clause "in an am o, nt in excess of twenty-eight thousand dollars ($28,000) ....i24 Defendant points out that under Pennsylvania Rule of Civil Procedure 1021(b), "[a]ny pleading demanding relief for unliquidated damages shall without claiming any specific sum set forth only whether the amount is or is not in excess of $10,000." It is apparent that in pleading wage loss 11 specifically the Plaintiff has attempted to comply with the general rule that "those items of damage which can be specifically calcu lated must be so presented in the body of the complaint." Narleli v. Scranton - Spring Brook Water Serv. Co., 51 Luzerne Leg. Rel. 75, 81 (1960); see Pa. R.C.P. 1020(b). The quoted requirement From Pennsylvania 22 Plaintiff's Complaint, paragraph 12. 23 id. 24 Plaintiff's Complaint, ad damnum clause. 13 No. 3100 Civil 1991 Rule of Civil Procedure 1021 "provides only for the form to be employed in the prayer for relief in a pleading 'here the total damages claimed cannot be specifically calculated or evaluated. It does not supplant the rules of pleading individual items of damage in the body of the complaint.;" Id. Viewed in this context, Plaintiff's complaints while it might have been more artfully drawn with respect to the prayer for relief, should be understood in accordance with its evident intention of compliance with both aspects of pleading procedure. It will thus be construed as pleading liquidated damages with respect to wage loss in an amount of at least eighteen thousand dollars, and a total monetary sum claimed, consisting of both liquidated and unliquidated damages, in an amount in excess of ten thousand dollars. The argument that a compulsory arbitration reference should have been included in Plaintiff's complaint is based upon Pennsylvania Rule of Civil Procedure 1021(c), w ich provides as follows: In counties having rules governing com- pulsory arbitration the plaintiff shalalso state whether the amount claimed does r does not exceed the jurisdictional amount requiring arbitration referral by local rule. Defendant is correct in the contention that the omplaint should have contained a specific reference in this regard. However, it is clear on the face of the complaint that the laim for relief 14 No. 3100 Civil 1991 exceeds the amount requiring compulsory arbitration as the local rule presently exists; as a consequence, the Court is not disposed to delay the case for the purpose of insisting upo a provision in the pleading so stating. See Pa. R.C.P. 126. For the foregoing reasons, the following Ord�r of Court will be entered: ORDER OF COURT AND NOW, this 16th day of July, 1992, upon consideration of the Defendant's Preliminary Objections to the Plaintiff's Complaint, and of the briefs and oral arguments resented in the matter, the Defendant's Preliminary Objections are DISMISSED. Defendant is granted twenty days within which to file an answer. Elliot A. Strokoff, Esq. Cathi L. Radner, Esq. 132 State Street P.O. Box 11903 Harrisburg, PA 17108 Counsel for Plaintiff Karen S. Feuchtenberger, Esq. 305 N. Front Street P.O. Box 1003 Harrisburg, PA 17108-1003 Counsel for Defendant BY THE COURT, 15 J.