This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).

STATE OF MINNESOTA

IN COURT OF APPEALS

C0-96-1714

Tomasa Vaughn,

Respondent,

vs.

Roseville VFW Post 7555,

Appellant.

Filed April 8, 1997

Affirmed

Harten, Judge

Ramsey County District Court

File No. C4-94-2551

Lawrence E. Meuwissen, Weinblatt & Associates, 1616 Pioneer Building, 336 North Robert Street, St. Paul, MN 55101 (for Respondent)

Frank T. Mabley, Greenstein, Mabley & Wall, L.L.C., 300 Rosedale Square Office Building, 2803 Lincoln Drive, Roseville, MN 55113 (for Appellant)

Considered and decided by Amundson, Presiding Judge, Short, Judge, and Harten, Judge.

U N P U B L I S H E D O P I N I O N

HARTEN, Judge

Appellant Roseville VFW Post 7555 argues that the district court erred in (1) failing to make specific findings as required by Sigurdson v. Isanti County, 386 N.W.2d 715 (Minn. 1986), (2) concluding that the working environment at the Post was hostile, (3) holding the Post liable for the manager's sexual and racial harassment, (4) concluding that the victim was constructively discharged, and (5) calculating damages, civil fines, and attorney fees. We affirm.

FACTS

In January 1991, appellant Tomasa Vaughn, a Hispanic woman, began working as a pulltab dealer at the Roseville VFW Post 7555 (the Post). The Post operated a bar, restaurant, and charitable gambling enterprise. Vaughn claims that she was racially and sexually harassed by the Post manager, Ernie Saxton. Restaurant and bar employees testified at trial that Saxton frequently told vulgar and offensive jokes, publicly abused and harassed female employees, and called employees vulgar and offensive names. Vaughn testified that Saxton made disparaging references about her heritage on two separate occasions: (1) Saxton asked her why she was working in the afternoon rather than taking a siesta and (2) Saxton publicly asked her about her "hot-blooded" sexual desires. Vaughn also complained that Saxton and the Post commander, Al Grenz, called women employees vulgar and offensive names.

In October 1991, Vaughn quit her job at the Post and began working at Flaherty's Bowl in Arden Hills; her earnings at Flaherty's were substantially less than at the Post. In March 1994, Vaughn sued the Post for sexual and racial harassment and constructive discharge under the Minnesota Human Rights Act (MHRA). Following a three-day bench trial, the district court found that Saxton, as Post manager, had engaged in racially and sexually abusive conduct toward Vaughn and that the Post atmosphere was hostile to female employees. The district court also found that the Post did not have a sexual harassment policy or any procedure to make it possible for employees to complain.

The district court awarded Vaughn $23,856 in compensatory damages for lost earnings, $5,000 for emotional anguish and humiliation, and directed Vaughn to file a motion for attorney fees. The court also awarded the State of Minnesota a $5,000 civil penalty. Thereafter, the court denied the Post's motion for amended findings. Vaughn then filed a motion for attorney fees and the district court ordered the Post to pay $24,120.95 in attorney fees and $1,766.17 in costs.

D E C I S I O N

1. District court findings will be reversed only if the result is clearly erroneous. Hubbard v. United Press Int'l, Inc., 330 N.W.2d 428, 441 (Minn. 1983); Bougie v. Sibley Manor, Inc., 504 N.W.2d 493, 499 (Minn. App. 1993). "This deference is especially strong in employment discrimination cases." Kay v. Peter Motor Co., 483 N.W.2d 481, 483 (Minn. App. 1992) (citing Sigurdson v. Isanti County, 386 N.W.2d 715, 721 (Minn. 1986)). Under this clearly erroneous standard, the district court's findings will not be disturbed if they are reasonably supported by the record evidence considered as a whole. Hubbard, 330 N.W.2d at 441. This court must view the evidence in the light most favorable to the district court's findings. Kresko v. Rulli, 432 N.W.2d 764, 768 (Minn. App. 1988), review denied (Minn. Jan. 31, 1989).

The Post argues that a number of the district court's findings are erroneous. We disagree. Having reviewed the record, we conclude that the findings, on the whole, are supported by the evidence.[1] The Post also argues that the district court erred by not making detailed factual findings. See Sigurdson, 386 N.W.2d at 721 (requiring findings on three-step analysis established by McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct 1817 (1973)). In Klink v. Ramsey County by Zacharias, 397 N.W.2d 894, 901 (Minn. App. 1986), review denied (Minn. Feb. 13, 1987) this court established the elements necessary to prove a prima facie case of harassment:

1. The employee belongs to a protected group.

2. The employee was subject to unwelcome sexual harassment.

3. The harassment complained of was based on sex.

4. The harassment complained of affected a "term, condition, or privilege" of employment.

5. Employer knowledge or imputed knowledge of the harassment and failure to take remedial action.

Id. at 901. Although the district court did not specifically mention the Klink factors, the court made specific findings on the first four factors. The district court also implicitly made a finding on the fifth factor by holding the Post liable based on the court's finding that Saxton "was the principle decision-making person for Post 7555." We conclude that the district court's findings are sufficiently detailed to accommodate appellate review of the evidence and the district court's decision.

2. The Post also challenges the district court's determination that Saxton's racial and sexual slurs created a hostile environment. The Post argues that Vaughn has no viable claim for sexual or racial harassment because Saxton's inappropriate comments were not directed toward her. See Minneapolis Police Dep't v. Minneapolis Comm'n On Civil Rights, 402 N.W.2d 125 (Minn. App. 1987) ("[R]acial slurs and epithets directed at people other than [the plaintiff] are not sufficient, by themselves, to establish * * * [a] prima facie case of discrimination."), aff'd, 425 N.W.2d 235 (Minn. 1988); Klink, 397 N.W.2d at 901-02 (affirming district court's ruling that employer did not maintain offensive work environment when alleged harassment included foul language in private offices, not directed at the plaintiff, and obscene materials were kept in offices, desk drawers, or lockers). The cases cited by the Post, however, are distinguishable from the instant case because the district court found, and the record supports, that some of Saxton's conduct was directed at Vaughn.

3. The Post also argues that it should not be held liable because Vaughn did not complain about Saxton's harassment. We have consistently held that where a manager commits sexual harassment, the manager's knowledge is imputed to the employer. Tru-Stone Corp. v. Gutzkow, 400 N.W.2d 836, 839 (Minn. App. 1987); Clark v. K-Mart Store No. 3059, 372 N.W.2d 847, 850 (Minn. App. 1985). The district court found that Saxton was the principle decision-maker and he required that all complaints (even complaints relating to his own conduct) be brought to him. Additionally, the district court found that Max DeFlorin, the Post commander, had a daily opportunity to observe Saxton's treatment of the Post employees. We conclude that the district court did not clearly err in holding the Post liable for Saxton's abusive conduct. See McNabb v. Cub Foods, 352 N.W.2d 378, 383 (Minn. 1984) (victim not required to formally complain about sexual harassment of which the employer had knowledge); see also Bersie v. Zycad Corp., 417 N.W.2d 288, 291 (1987) (employer liable if had actual knowledge of harassment or if incidents were so obvious or pervasive that employer should have known of the misconduct), review denied (Minn. May 5, 1988).

4. The Post also argues that the district court erred by concluding that Vaughn was constructively discharged. "A constructive discharge occurs when an employee resigns in order to escape intolerable working conditions caused by illegal discrimination." Continental Can Co. v. State, 297 N.W.2d 241, 251 (Minn. 1980) (citing Danz v. Jones, 263 N.W.2d 395, 402 n.4 (Minn. 1978)). The district court found that Vaughn was the "victim of work conditions patently hostile to reasonable women" and that she was "the target of racially charged stereotypes because of her heritage." The district court concluded that Vaughn was "constructively discharged when she left her employment rather than endure this environment." There is evidence to support the district court's finding that Vaughn was constructively discharged. The district court's conclusion is not clearly erroneous.

5. The Post also argues that the district court erred in calculating damages. The amount of compensatory damages awarded under the MHRA is within the discretion of the district court; this court will reverse only when that discretion has been abused. Melsha v. Wicks Cos., 459 N.W.2d 707, 709 (Minn. App. 1990), review denied (Minn. Oct. 25, 1990). The Post challenges the district court damage calculations because the damage award was based on the testimony of Vaughn's co-worker; it also argues that Vaughn's damages should have been cut off when she moved out of the state. The district court's decision to base Vaughn's wage losses on the testimony of Vaughn's co-worker is within its discretion. See Sigurdson, 386 N.W.2d at 721 ("[A]ppellate court cannot judge the credibility of a witness or the weight, if any, to be given to testimony."). Additionally, the record indicates that Vaughn was unable to match her Post earnings after she was constructively discharged. We conclude that the district court's calculation of damages was not an abuse of discretion.

6. The Post also argues that there is insufficient evidence to support the district court's award of $5,000 damages for emotional anguish and humiliation. The Post asserts that damages for mental anguish can only be awarded if the distress is severe and caused by egregious circumstances as suggested in Hubbard, 330 N.W.2d at 439.

We have previously held that the award of emotional distress damages under the MHRA is distinguishable from Hubbard for two reasons: (1) "the plaintiff in Hubbard asserted an independent tort claim for intentional infliction of emotional distress in addition to his employment discrimination claims" and (2) at the time of Hubbard, the MHRA did not provide for damages for mental anguish or suffering. State by Cooper v. Mower County Soc. Servs., 434 N.W.2d 494, 499-500 (Minn. App. 1989). In Cooper, we held that an award for mental anguish under the MHRA does not require any "particularly egregious facts" or require "severe" mental distress as long as the "findings regarding mental anguish are there and support the award." Id. at 500 (quoting State v. Porter Farms, Inc., 382 N.W.2d 543, 551 (Minn. App. 1986). We have reviewed the record and conclude that the district court's finding that Vaughn suffered "mental anguish, humiliation and anger" over her treatment at the Post is supported by the record; the district court's award of emotional distress damages is within its discretion.

7. The Post contends that the district court abused its discretion by assessing a $5,000 civil penalty because the penalty is disproportionate to the $500 civil penalty affirmed in Giuliani v. Stuart Corp., 512 N.W.2d 589, 597 (Minn. App. 1994). An award in determination of the amount of the civil penalty is within the district court's discretion and will not be reversed absent an abuse of discretion. Gillson v. State Dept. of Natural Resources, 492 N.W.2d 835, 843 (Minn. App. 1992), review denied (Minn. Jan. 28, 1993). The amount of the penalty is based upon the seriousness of the violation, the public harm caused by the violation, the intentional nature of the violation, and the financial resources of the party violating the act. Minn. Stat. § 363.071, subd. 2 (1996). The district court made findings on these statutory factors and the findings are supported by the evidence. We conclude that the $5,000 civil penalty is within the district court's discretion.

8. Finally, the Post claims that the district court abused its discretion by not reducing Vaughn's attorney fees request for the time spent on her reprisal claim. See Giuliani, 512 N.W.2d at 596 (affirming district court's reduction of attorney fees where plaintiff was successful on only one of three actions). Although Vaughn pleaded the reprisal claim in her original complaint, she did not argue that claim at trial. We conclude that the district court's award of attorney fees was within the district court's discretion. See id. (reviewing district court's award of attorney fees under abuse of discretion standard).

Affirmed.

[ ]1Finding 13, where the district court found that a bulletin board was maintained with vulgar and sexual jokes and pictures, is not supported by the evidence. The only reference to the Post bulletin board in the record was from waitress Karla Miller's response during cross-examination affirming that there was in fact a bulletin board with jokes and pictures on it. There is no mention in the record, however, that those jokes or pictures were sexually or racially explicit. Although we note that this finding is erroneous, the error is harmless. See Minn. R. Civ. P. 61 (harmless error rule).