This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Paul H. Lyman, et al.,
Ricsons, Inc., et al.,
Filed January 25, 2000
Affirmed in part, reversed in part, and remanded
Concurring in part, dissenting in part, Short, Judge
Hennepin County District Court
File No. 98008509
Galen E. Watje, Steven C. Moore, Sisam & Watje, Ltd., 6600 France Avenue South, No. 360, Edina, MN 55435 (for appellants)
Bruce W. Larson, 3905 IDS Center, 80 South Eighth Street, Minneapolis, MN 55402 (for respondents).
Considered and decided by Short, Presiding Judge, Shumaker, Judge, and Anderson, Judge.
U N P U B L I S H E D O P I N I O N
Respondents Ricsons, Inc. and Richard Strese hired appellant Paul H. Lyman to promote their business. When respondents terminated his employment, Lyman sued, alleging breach of contract, fraud, bad faith termination, breach of implied covenants, and unjust enrichment. The district court granted respondents' summary judgment motion on all claims, and ruled that Lyman's employment was at-will. Lyman appealed. We affirm in part, reverse in part, and remand.
F A C T S
After Paul Lyman had been laid off from his job as a retail furniture sales manager, he decided to try self-employment as an independent furniture sales representative. Richard Strese, a principal in a furniture delivery company known as Ricsons, Inc., contacted Lyman to offer him a job. Strese wanted greater customer exposure for his company and he hoped that Lyman would be able to promote Ricsons in his furniture sales calls.
The two had a series of conversations about job duties, compensation, and the duration of the employment. In one discussion, Strese asked "How does this end?" Lyman alleges that he replied:
The only way this thing can end is if I do something totally outrageous to a customer, if I get a line that requires me to go exclusive * * *, or for as long as Ricsons does business. Otherwise that thing can't end. Because I'm not going to put you into business to put me out of business.
Strese's recollection of the discussion differs from Lyman's. He recalls that Lyman wanted to be sure that he would be able to get out of the employment at any time, and that they agreed:
[F]or any reason he would be able to leave, and if I wanted to change my way of doing business any way or for any reason, I would be able to end the business or end the relationship with the sales rep.
According to Strese, Lyman said that in the "furniture reping business" it was normal that if things were not working out the company would let the representative go and the matter would be over with. Strese alleges that he and Lyman discussed possible indications that things were not working out, such as Lyman not doing well or abusing customers, or customer complaints. However, Strese alleges, these were merely descriptive and not conditions of limitation. He contends that he and Lyman understood and agreed that the employment could be terminated by either for any reason.
Lyman accepted the job with Ricsons, Inc. At the beginning he devoted about 80% of his time promoting Ricsons. The percentage declined markedly over the years, so that by the sixth year on the job he was spending only 1% of his time on Ricsons promotions. Despite this reduction, he continued to receive the commissions on which the parties had agreed.
In the sixth year of employment, Strese wrote to Lyman and stated that unless they renegotiated their contract, Lyman's employment would terminate in 60 days. Lyman declined to renegotiate, and Strese terminated his job.
Lyman sued for damages, alleging breach of contract, fraud, unjust enrichment, bad-faith termination, and breach of covenant of good faith and fair dealing.
Ricsons, Inc. and Strese moved for summary judgment. The district court granted the motion as to all claims. Lyman appealed only the rulings on breach of contract, fraud, and unjust enrichment.
D E C I S I O N
On appeal from summary judgment, this court determines whether there are genuine issues of material fact, and whether the district court erred in its application of law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990); see also Minn. R. Civ. P. 56.03. This court will not reverse a summary judgment if it can be sustained on any ground. Winkler v. Magnuson, 539 N.W.2d 821, 828 (Minn. App. 1995). A summary judgment motion temporarily admits for purposes of the motion the truth of the opposing party's assertions. M. Snower & Co. v. United States, 140 F.2d 367, 370 (7th Cir. 1944). Furthermore, "[t]his court views the evidence most favorably to the party against whom summary judgment was granted." Aberman v. Malden Mills Indus., Inc., 414 N.W.2d 769, 771 (Minn. App. 1987) (citations omitted).
Breach of Contract
Ruling that Lyman's employment with Ricsons, Inc. was at-will, the district court granted summary judgment on Lyman's claims of breach of contract.
Employment for an indefinite duration is said to be employment at-will, and the relationship can be terminated summarily by either party for any reason. Hedglin v. City of Willmar, 582 N.W.2d 897, 901 (Minn. 1998); Ruud v. Great Plains Supply, Inc., 526 N.W.2d 369, 371 (Minn. 1995); Pine River St. Bank v. Mettille, 333 N.W.2d 622, 627 (Minn. 1983) (citing Cedarstrand v. Lutheran Bhd., 263 Minn. 520, 532, 117 N.W.2d 213, 221 (1962). However, it is permissible for the parties to modify an at-will employment relationship so as to create a specific duration of employment or conditions for termination. Audette v. N.E. St. Bank of Minneapolis, 436 N.W.2d 125, 126 (Minn. App. 1989).
Summary judgment is appropriate when we accept as true the discharged employee's version of the facts and those facts are still legally insufficient to establish a modification of the at-will employment. Id. at 127. The issue here is whether Lyman's version of the agreement about termination, if true, constitutes a modification of an otherwise at-will employment.
Under Lyman's version, the employment was to be permanent, but it could be terminated by Ricsons for any of three specific reasons. An offer of permanent employment, even when coupled with assurances that the employee will have lifetime job security, is not enough to modify the at-will nature of the employment. Aberman, 414 N.W.2d at 771-72 (Minn. App. 1987) (holding that employer's alleged statements to employee that "I will always take care of you," "we are offering you security," and "[you will be a] lifetime sales representative," were insufficient to alter at-will nature of employment). But a modification of an at-will relationship occurs when the parties agree to a condition that will terminate the relationship. In Roglien v. Carter, 443 N.W.2d 217, 219 (Minn. App. 1989), review denied (Minn. Sept. 21, 1989), this court stated:
[Employee] claims that [employer's] alleged representation that [employee] would not have to worry about his job so long as he did good work constitutes an offer of employment subject to dismissal only for good cause. We agree.
Here, if Strese and Lyman agreed that the employment could be terminated only for one of the three reasons stated, they modified the otherwise at-will nature of their relationship. We agree with the dissent that a party's subjective belief about the nature of the employment relationship is not relevant to ascertaining contractual terms. But here the record reveals that the parties specifically discussed the duration of the employment. Contracts are often formed or modified by such discussions. The parties differ as to which version of the discussion is true. It is the parties' spoken words, and not their subjective beliefs, that create a fact issue. This fact issue involves credibility determinations that the district court cannot make on summary judgment. See Foley v. WCCO Television, Inc., 449 N.W.2d 497, 506 (Minn. App. 1989) (on summary judgment trial court does not weigh evidence, determine credibility, or resolve factual disputes), review denied (Minn. Feb 9, 1990). The district court erred in ruling that Strese and Ricsons, Inc. were entitled to judgment as a matter of law. The ruling must be reversed and the matter remanded for trial on the breach of contact claim.
Lyman claims Strese defrauded him by allowing him to build up Ricsons, and then quickly terminating him. A claim for fraudulent misrepresentation requires proof that the misrepresenter acted dishonestly or in bad faith. Florenzano v. Olson, 387 N.W.2d 168, 173 (Minn. 1986). The district court dismissed this claim, ruling that Lyman "cannot show that there exists a genuine issue of material fact that Defendants had any preconceived plan to quickly terminate Lyman’s employment." Strese employed Lyman for approximately six years. During the last two years, Lyman spent less than 5% of his time working for Strese, yet he still received significant commissions. These uncontroverted facts do not support Lyman’s claim that Strese intended to defraud Lyman by quickly terminating him. The district court did not err by dismissing Lyman’s fraud claim.
To establish a claim for unjust enrichment, the claimant must show that another party knowingly received something of value to which he was not entitled, and that the circumstances are such that it would be unjust for that person to retain the benefit. ServiceMaster of St. Cloud v. GAB Bus. Servs., Inc., 544 N.W.2d 302, 306 (Minn. 1996). Lyman claims that Strese continued to receive the benefit of his services after he was terminated. It is undisputed that Lyman has been paid for all services he rendered. Lyman was never an owner or partner of Ricsons, and, therefore, he cannot claim that he is entitled to future profits. Lyman solicited clients for Ricsons for six years, and Strese paid Lyman commissions for six years. Thus, the record does not support Lyman’s claim for unjust enrichment because he has not shown a fact issue that Strese received something of value to which he was not entitled.
Affirmed in part, reversed in part, and remanded.
SHORT, Judge (concurring in part, dissenting in part)
I concur the trial court properly dismissed Lyman’s fraud and unjust enrichment claims. But I respectfully dissent because the trial court correctly dismissed Lyman’s contract claim.
Employees who are hired for an indefinite period of time are considered "at-will" employees. Pine River State Bank v. Mettille, 333 N.W.2d 622, 627 (Minn. 1983). An at-will employment relationship can be terminated by either party for any or no reason. Id. Although an employer’s acts and representations may create an enforceable employment contract terminable only for good cause, an employee must prove, as a matter of law, that the presumptive at-will relationship has been altered. See, e.g., Ruud v. Great Plains Supply, Inc., 526 N.W.2d 369, 372 (Minn. 1995) (holding statement that "good employees are taken care of" was policy statement as to general good will of company, rather than offer for permanent job); Rognlien v. Carter, 443 N.W.2d 217, 219 (Minn. App. 1989) (holding employer made sufficiently definite offer for permanent employment where employer told employee he would not have to worry about his job as long as he did good work), review denied (Minn. Sept. 21, 1989).
Lyman claims his at-will relationship with Ricsons was modified when he said to Strese:
The only way this thing [relationship] can end is if I do something totally outrageous to a customer, if I get a line that requires me to be exclusive like Thomasville required of my father, or for as long as Ricsons does business.
But a party’s beliefs are not relevant to ascertaining contractual terms. See Schibursky v. IBM, 820 F. Supp. 1169, 1180 (D. Minn. 1993) (recognizing party’s subjective impressions and beliefs are not relevant to determining contractual terms); Aberman v. Malden Mills Indus., 414 N.W.2d 769, 771 (Minn. App. 1987) (noting employee must establish employer clearly intended to create employment contract terminable only for cause) (citing Corum v. Farm Credit Servs., 628 F. Supp. 707, 713-14 (D. Minn. 1986)). Significantly, the record contains no evidence of: (1) Ricsons acts or representations, which allegedly altered the at-will relationship; (2) relocation by Lyman; or (3) sacrifice of personal or spouse’s career or pension opportunities to secure employment with Ricsons. See Bussard v. College of St. Thomas, 294 Minn. 215, 223, 200 N.W.2d 155, 161 (1972) (finding employee, by furnishing valuable consideration other than customary daily services, in effect purchases permanent employment); Skagerberg v. Blandin Paper Co., 197 Minn. 291, 302, 266 N.W. 872, 877 (1936) (holding employee’s rejection of another job offer did not constitute sufficient consideration to convert at-will employment to permanent employment); Rognlien, 443 N.W.2d at 219 (reversing summary judgment in employer’s favor where employee gave up former job and employer told him he would keep job as long as he did good work); Eklund v. Vincent Brass & Alum. Co., 351 N.W.2d 371, 377 (Minn. App. 1984) (reversing summary judgment in employer’s favor where employee produced evidence he supplied additional valuable consideration by giving up 26-year career and pension opportunities at former employer, relocating family, and forcing wife to give up her job and seek new employment). In addition, Lyman does not claim a handbook provision altered his employment contract. See Mettille, 333 N.W.2d at 626-27 (holding handbook may alter employment contract where language constitutes offer, offer is communicated to employee by dissemination, employee accepts offer and furnishes consideration). Under these circumstances, the contract entered into by Lyman and Ricsons was terminable at-will. The trial court correctly granted summary judgment in favor of Ricsons on Lyman’s contract claim, and I would affirm.