Opinion
NO. 2014-CA-001687-MR
02-19-2016
ANGELA BURTON APPELLANT v. APPRISS, INC. APPELLEE
BRIEFS FOR APPELLANT: Garry Adams David N. Ward Louisville, Kentucky BRIEF FOR APPELLEE: Stephen B. Pence Louisville, Kentucky
NOT TO BE PUBLISHED APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE SUSAN SCHULTZ GIBSON, JUDGE
ACTION NO. 12-CI-003645 OPINION
AFFIRMING IN PART, REVERSING IN PART AND REMANDING BEFORE: KRAMER, D. LAMBERT AND STUMBO, JUDGES. STUMBO, JUDGE: Angela Burton appeals from a Judgment of the Jefferson Circuit Court reflecting a jury verdict in favor of Appriss, Inc. Burton's complaint sets forth claims of breach of contract, violation of KRS 337.010 et seq. and wrongful termination from her employment as an account manager with Appriss. She asserts five arguments on appeal centering on her contention that the jury was improperly instructed, that it made an erroneous finding and that the court erred in directing a verdict in favor of Appriss on her claim of wrongful termination. For the reasons stated below, we AFFIRM the Judgment in part, REVERSE in part and REMAND the matter to the Jefferson Circuit Court.
Kentucky Revised Statute. --------
Appriss is a corporate entity that provides electronic monitoring and reporting systems to private, governmental and law enforcement entities. On April 25, 2011, Appriss hired Burton as an Account Manager at an annual salary of $60,000 plus a $3,000 signing bonus. At the time of the hiring, Appriss did not have a bonus plan in place. However, the President of Appriss' Information Services Group, Paul Colangelo, told Burton that he intended to implement a plan shortly after her hiring. As an Account Manager, Burton was responsible for both retaining and servicing current clients, as well as "upselling" additional products to specific customers.
In approximately March 2011, Colangelo began developing an incentive plan for Account Managers referred to in the record as Variable Pay Compensation Agreement ("VPCA"). The plan was distributed to Account Managers, including Burton, on June 16, 2011. According to the plan's terms, Burton was entitled to a $10,000 commission if she received a "sales growth target" of $133,057.00, with an additional $2,500 bonus if she achieved a target of $146,363.00.
In her written argument, Burton characterizes the phrase "sales growth target" as undefined in the VPCA, and that the plan's author, Vice President of Human Resources Rick Cartor, did not know the meaning of the phrase. Conversely, Appriss maintains that the VPCA and commission schedule is clear and unambiguous. It contends that Account Managers were told that commissions were payable to them in the quarter in which they were earned, and were based on invoices billed and received rather than the contracts signed by customers. It contends that Colangelo explained the plan to everyone, that Burton's supervisor, Natalie Browning, expressly explained it to her via email and that Burton "still did not get it." According to Appriss, and despite ample explanation, Burton continued to believe that she should receive commissions as soon as she delivered a signed contract, rather than when revenues were invoiced and received.
The parties give differing interpretations of their relationship in late 2011 and early 2012. According to Burton, Colangelo told her near the end of 2011 that Appriss had not met its numbers so no one was getting a commission, but that "she had knocked it out of the park". Colangelo did give Burton a $3,000 bonus and allowed her to carry over $100,000 in sales toward her 2012 commission. Conversely, Appriss would maintain that its senior management team was increasingly unhappy with Burton's job performance, and Colangelo described her performance as a "D". It argued that Burton did not generate enough billed and collected sales to merit a commission.
Appriss provided Burton with a 2012 VPCA on February 6, 2012, which contained a revised commission schedule. Burton would later maintain that in the first few months of 2012, and after Burton had complained that she did not receive the 2011 commission to which she believed she was entitled, Appriss personnel began treating her differently. According to Burton, Browning would walk past her without saying hello. Burton also would testify that she believed Browning was transitioning clients away from her because Browning was responding to her emails and cutting her out of communications with the clients assigned to Burton. Appriss, however, would contend that in early 2012, Browning felt that she was spending far too much time still guiding Burton, even though Burton had received more guidance and training than any other Account Manager. According to Browning, she still had to accompany Burton on client visits because Burton seemed not to understand Appriss products. Browning discussed these shortcomings with Burton, and suggested that Burton seek another position at Appriss. Ultimately, and according to Appriss, when Burton's performance didn't approve, Appriss fired Burton on May 17, 2012.
On July 2, 2012, Burton filed the instant action in Jefferson Circuit Court against Appriss alleging failure to pay wages/commissions in violation of KRS 337.385, retaliatory discharge in violation of KRS 337.990(9), and punitive damages. By way of an amended complaint, Burton asserted the additional claims of breach of contract, quantum meruit or unjust enrichment, promissory estoppel and fraud. Each of the claims was based on Appriss' alleged failure to pay commissions under the 2011 and 2012 VPCA, and from its firing Burton.
The matter proceeded to a jury trial in May 2014, at which time the Jefferson Circuit Court directed a verdict in favor of Appriss on Burton's retaliatory discharge claim. As a basis for the directed verdict, the court determined that Burton had not presented any proof that Appriss knew that Burton was considering filing a legal action; therefore, Appriss could not have terminated her employment in a retaliatory manner. The remaining claims went to the jury, which returned a verdict in favor of Appriss. The verdict rendered Burton's other claims moot. The trial court entered a Judgment reflecting the verdict, and this appeal followed.
Burton first argues that the jury's Instruction Nos. 2 and 3 improperly allowed the jury to decide a question of law, to wit, whether the 2011 and 2012 VPCAs were ambiguous. She argues that these questions of law are strictly a matter of interpretation by the court, and that by allowing the jury to consider a question of law, the court committed reversible error. Burton contends that this error entitles her to a new trial.
Instruction No. 2 stated in relevant part that, "[i]f, in construing the [2011] agreement itself, you believe that it is ambiguous, you should construe that ambiguity in Ms. Burton's favor, because Appriss drafted the agreement." Instruction No. 3 contained identical phraseology as to the 2012 agreement. The question for our consideration is whether these directives constitute questions of law reserved exclusively for the trial court. We must answer this question in the affirmative. Questions involving the construction and interpretation of contracts, including questions regarding ambiguity, are questions of law reserved exclusively for the court. Hazard Coal Corporation v. Knight, 325 S.W.3d 290, 298 (Ky. 2010). See also, Richey v. Perry Arnold, Inc., 391 S.W.3d 705 (Ky. 2012); Payne v. Rutledge, 391 S.W.3d 875 (Ky. App. 2013); and, Clark v. Hectus & Strause, PLLC, 345 S.W.3d 857 (Ky. App. 2011). However, if the court finds a contract to be ambiguous, the jury may then answer the factual question of what the parties intended. Clark at 859.
By instructing the jury to examine the agreements to determine if they were ambiguous, the court directed the jury to consider questions of law reserved solely for the court. The court's instruction to construe any ambiguity in Burton's favor does not remedy the error of presenting a question of law to the jury. Arguendo, had the court made the determination that the agreements were ambiguous and communicated this conclusion in the instructions, the jury could then properly answer the factual question of what the parties intended. In the matter at bar, the court did not instruct the jury that the agreements were ambiguous, and then direct it to answer the factual question of what the parties intended. Rather it directed the jury - in clear and unambiguous language - to determine if the agreements were ambiguous. This was in error and Burton is entitled to a new trial. This renders moot Burton's second argument, to wit, that the jury erroneously concluded that she was not entitled to commissions under the 2011 and 2012 VPCAs.
Burton next argues that the court erred in directing a verdict in favor of Appriss on her claim of wrongful termination in violation of public policy. She maintains that the court improperly concluded Burton failed to offer any proof that, 1) Burton was about to institute a civil action against Appriss, and 2) that Appriss was aware of this fact and wrongfully terminated Burton's employment because of it. She also contends that the underlying statute, KRS 337.990(9), should be construed broadly so as to effectuate its purpose.
Under the terminable at will doctrine, "an employer may discharge his at-will employee for good cause, for no cause, or for a cause that some might view as morally indefensible." Firestone Textile Co. Div., Firestone Tire & Rubber Co. v. Meadows, 666 S.W.2d 730, 731 (Ky. 1983). In Gryvb v. Evans, 700 S.W.2d 399 (Ky. 1985), the Kentucky Supreme Court clarified Firestone and held that absent a specific legislative act prohibiting the discharge, the termination of at will employment was actionable only 1) where the alleged reason for the discharge from employment was the refusal to violate the law in the course of employment, or 2) when the reason for the discharge from employment was the employee's exercise of a right conferred by a well-established legislative enactment. Id. at 402. Burton asserts the latter of these two exceptions, i.e., that she was discharged from employment because she was about to exercise her right to institute a civil action against Appriss.
The underlying legislative act to which Burton directs our attention is KRS 337.990(9) which states that,
[a]ny employer who discharges or in any other manner discriminates against any employee . . . because the employee has caused to be instituted or is about to cause to be instituted any proceedings under KRS 337.385 . . . shall be deemed in violation of KRS 337.275 to 337.325,
KRS 337.345, and KRS 337.385 to 337.405 and shall be assessed a civil penalty[.]
In granting a directed verdict on Burton's wrongful termination claim in favor of Appriss, the Jefferson Circuit Court apparently determined that the only relevant proof on this issue was that Burton contacted Legal Aid which told her that it did not handle cases of this type. We say apparently because the Record on Appeal does not contain the compact disc recording of the trial proceeding. It was at that proceeding that the court purportedly conveyed its reasoning for sustaining Appriss' Motion for Directed Verdict as to Burton's wrongful termination claim. When "the complete record is not before the appellate court, that court must assume that the omitted record supports the decision of the trial court." Commonwealth v. Thompson, 697 S.W.2d 143, 145 (Ky. 1985).
Arguendo, even if the video record were before us, we would find no error on this issue. Burton maintains that once Appriss was informed that Burton made complaints to Browning, Colangelo and Cartor, "it was put on notice that Burton was, at least, considering taking come [sic] action to recover her unpaid wages." We do not share this conclusion, as Burton's complaints to Appriss' managers does not equate to notice of impending legal action. In her written argument, Burton does not cite to any direct proof that Appriss actually knew that Burton was considering legal action at the time Appriss dismissed her. As such, she could not meet the burden of proving wrongful termination had the matter gone to the jury.
When engaging in appellate review of a ruling on a motion for directed verdict, the reviewing court must ascribe to the evidence all reasonable inferences and deductions which support the claim of the prevailing party. Once the issue is squarely presented to the trial judge, who heard and considered the evidence, a reviewing court cannot substitute its judgment for that of the trial judge unless the trial judge is clearly erroneous.Bierman v. Klapheke, 967 S.W.2d 16, 18-19 (Ky. 1998)(citations omitted).
In reviewing the sufficiency of evidence, the appellate court must respect the opinion of the trial judge who heard the evidence. A reviewing court is rarely in as good a position as the trial judge who presided over the initial trial to decide whether a jury can properly consider the evidence presented. Generally, a trial judge cannot enter a directed verdict unless there is a complete absence of proof on a material issue or if no disputed issues of fact exist upon which reasonable minds could differ.
We may assume that the missing video trial record supports the Jefferson Circuit Court's entry of a Directed Verdict on Burton's wrongful termination claim. Thompson, supra. Even if the video record were before us, we would have no basis for concluding that the trial court's action was clearly erroneous as Burton does not direct us to any specific proof that Appriss wrongfully terminated her employment in anticipation of pending litigation. Accordingly, we find no error on this issue.
For the foregoing reasons, we AFFIRM in part the Judgment of the Jefferson Circuit Court, REVERSE in part and REMAND the matter for a new trial on the breach of contract claim only.
ALL CONCUR. BRIEFS FOR APPELLANT: Garry Adams
David N. Ward
Louisville, Kentucky BRIEF FOR APPELLEE: Stephen B. Pence
Louisville, Kentucky