Opinion
CASE NO. 8:98-CV-921-T-17B.
April 29, 1998.
George L. Hayes, III, Powell, Carney, Hayes, Silverstein, P.A. St. Petersburg, FL, MARGARET A. MINOR, plaintiff.
John E. Phillips, Jr., Melissa E. Lea, Holland Knight, LLP Tampa, FL, Marilyn Joyce Holifield, Holland Knight LLP, Miami, FL, Allan H. Weitzman, Proskauer Rose LLP, Boca Raton, FL, METROPOLITAN LIFE INSURANCE COMPANY, INC., defendant.
ORDER GRANTING DEFENDANT'S RE FILED MOTION FOR SUMMARY JUDGMENT
This cause is before the Court on Defendant's Refiled Motion for Summary Judgment (Dkt. 113), Plaintiff's Response (Dkt. 127), and Defendant's Reply (Dkt. 138).
FACTS
Plaintiff filed this action against Defendant for breach of an oral contract for lifetime employment and for fraudulent inducement.
Plaintiff began working for Defendant, Metropolitan Life Insurance Company, Inc. ("MetLife"), after high school in 1963. Plaintiff first worked in Defendant's personal health insurance claims department in New York. (Dkt. 77). Plaintiff advanced in this department over the years, rising to the position of Supervisor of Employer Benefit Program Claims in 1983. (Dkt. 77). In 1987, Vincent Grecco was Plaintiff's superior. Plaintiff transferred to Florida in February, 1993, and her supervisor became Marian Rausch, but Grecco was still the head of the unit. (Dkt. 77). Plaintiff's job was to answer insurance department complaints, assist with litigation in the legal department, and generally assist Grecco on any special projects. (Dkt. 77).
In 1991, Defendant decentralized its personal health insurance operation, and relocated it to Tampa, Florida. (Dkt. 77). On or about June of 1992, Grecco called Plaintiff in his office in New York City. (Dkt. 77). Grecco asked Plaintiff to relocate to Tampa. (Dkt. 77). He indicated that if she did not go, Defendant would hire someone locally for her job, and Plaintiff would no longer have a job. (Dkt. 127). Grecco attempted to convince Plaintiff to relocate. Plaintiff states the Grecco represented that if Plaintiff relocated she "would have a future" in Florida, and that there was the opportunity to move up. (Dkt. 127). Plaintiff decided to relocate to Tampa, and signed a written Relocation Offer and Acceptance Form on June 30, 1992. Plaintiff did relocate and thereafter received effective job ratings. (Dkt. 77).
In August, 1994, Grecco spoke with the employees at the Tampa office and told them that a new company was going to be created between MetLife and Travelers Insurance Company. (Dkt. 127). Grecco indicated that all employees would be transferred to the new company without any choice. (Dkt. 127). Grecco also stated that they would be terminated in the next year. (Dkt. 127) The next week, MetLife sent Senior Vice President Howard Kurpit to speak to the employees, and attempted to minimize what Grecco said. (Dkt 127).
On September 1, 1994, MetLife and Travelers entered into an agreement that created MetraHealth, a company to which both would transfer their respective medical business. (Dkt. 127). In January, 1995, this change became effective. (Dkt. 127). MetLife informed its transferred employees that if they refused to be transferred to MetraHealth, they would be treated as if they had voluntary resigned. (Dkt. 127).
On February 28, 1995, Jan Raffino, as Vice-President of MetraHealth, sent a letter to Plaintiff, indicating that a business decision was made to close the Tampa office. (Dkt. 127). The letter stated that all the employees would be terminated in two waves, one in June, 1995, and the other in December, 1995. (Dkt. 127). On December 31, 1995, Plaintiff was terminated by MetraHealth. (Dkt. 127). Plaintiff received severance in the amount of $46,000.00. (Dkt. 127). On March 7, 2000, Plaintiff began to receive monthly pension benefits from MetLife in the amount of $1,560.60. (Dkt. 113).
On April 29, 1998, Plaintiff filed this lawsuit, seeking over $800,000 in damages from MetLife.
STANDARD OF REVIEW
Summary judgment is proper if "the pleadings, depositions, answers to interrogatories, and admission on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party bears the burden of proving that no genuine issue of material fact exists. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A material fact is one which "might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).
The evidence presented must be construed in favor of the non-moving party, and that party must receive the benefit of all favorable inferences that can be drawn from that party's evidence. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962);Evans v. Meadow Steel Products, Inc., 579 F. Supp. 1391, 1394 (N.D. Ga. 1984). The Court's function is not to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). If the non-moving party fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which the party will bear the burden of proof at trial, summary judgment should be granted. See Jones v. Gerwens, 874 F.2d 1534, 1538 (11th Cir. 1989) (citing Celotex, 477 U.S. at 324-25, 106 S.Ct. 2548).
DISCUSSION
I. BREACH OF CONTRACT Claim
A. Law of New York Governs
In determining what law applies to the contract claim in this case, Plaintiff correctly argues that Ray-Hof Agencies, Inc. v. Peterson, 123 So.2d 251 (Fla. 1960), is determinative in choice of law questions arising from employment. However, Ray-Hof only applies to unilateral contracts, which require performance to accept the contract terms. The case before the Court is distinguishable. Plaintiff and Defendant executed an Offer and Acceptance form in which both parties were given rights and privileges. Defendant correctly asserts that this agreement imposed bilateral obligations upon both parties. Plaintiff knew that she was required to relocate to Florida, and Defendant knew that it would have to assist her financially in the relocation.
Plaintiff argues that Florida law applies, as Ray-Hof holds that the state in which the last act needed to form a contact should control the choice of law. Specifically, Plaintiff argues that her actual relocation to Florida was performance in Florida. Conversely, Defendant argues that Plaintiff's performance was the execution of the Relocation Offer and Acceptance Form, and this was the last act necessary to form a contract. As this execution occurred in New York, and the contract is bilateral in nature, performance is not needed to complete contract formation. The Court concludes that all acts necessary for contract formation occurred in New York, and it is appropriate to apply New York law.
B. At Will Employment Status
In the course of her employment with Defendant, Plaintiff was never under a written employment agreement, and was always employed at will.
New York law is well settled on the proposition that without an agreement establishing a fixed duration, the employment relationship is at will. See De Petris v. Union Settlement Assn., Inc., 86 N.Y.2d 406, 410, 657 N.E.2d 269, 633 N.Y.S.2d 274 (N.Y. 1995). In Weiner v. McGraw-Hill, Inc., the court held that only where there is an express agreement will the right to freely discharge be limited. See 57 N.Y.2d 458, 465-66, 443 N.E.2d 441, 457 N.Y.S.2d 193 (N.Y. 1982). The court set forth factors that a plaintiff must successfully satisfy before the presumption of at will employment is rebutted. See id. The Weiner court held that a plaintiff must prove: (1) the existence of express language that explicitly restricts the employer's right to terminate employees; and (2) specific pre-hire and post-hire reliance upon "just cause" language. See id.
These factors were not met in this case. For the duration of her time with Defendant, Plaintiff was an at will employee. Plaintiff knew that she could terminate her employment with MetLife at any time; MetLife could also terminate Plaintiff's employment without cause at any time. In her deposition, Plaintiff admitted to being bound by the provisions of the MetLife Employee Handbook. (Dkt. 78). This handbook specifically states that there was no representation of continued employment. (Dkt. 78). Accordingly, Plaintiff was always an at will employee of Defendant.
Plaintiff alleges that the conversation with Grecco somehow transformed her at will employment to employment for life. However, there is no proof that Grecco was authorized to make such a promise. Plaintiff's execution of the Relocation Offer and Acceptance Form is significant. The Court concludes the document comprises the dispositive and comprehensive agreement between the parties. However, this agreement is notably devoid of any mention of lifetime employment. Alternatively, the agreement clearly demonstrates the lack of any obligation to employ Plaintiff for any period of time. At the time of transfer, MetLife viewed Plaintiff as an at will employee.
C. Alleged Oral Contract Barred by Statute of Frauds
Even assuming that Defendant's conduct would support an oral contract, such a contract is barred by the statute of frauds, where such a contract for lifetime employment is required to be reduced to writing and could not be performed within one year. The New York statute of frauds is instructive in this regard:
Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking: By its terms is not to be performed within one year from the making thereof or the performance of which is not to be completed before the end of a lifetime.
Gen. Oblig. Law § 5-701(a); Gen. Oblig. Law § 5-701(a)(1).
Defendant relies upon the body of New York law which supports the rule that oral contracts or promises to employ an employee until retirement are not performable within one year are void under the Statute of Frauds. Specifically, Defendant argues, "New York courts have recognized that contracts with provisions promising employment until the employee retires are not performable within one year, and therefore, must satisfy the Statute of Frauds. This is so because the right to cancel such a contract is limited unilaterally to the plaintiff, and it is illusory, from the point of view of the defendant, to consider the contract terminable or performable within one year." Yglesias v. Simmons Mkt. Research Bureau, NO. CIV. 90-3898 (CSF), 1991 WL 49744, at *3 (D.N.J. Apr. 1, 1991) (citing Harris v. Home v. Indem. Co. 6 A.D.2d 861, 175 N.Y.S.2d 603, 604 (1st Dept. 1958).
Plaintiff incorrectly relies upon Florida law on the issue of the Statute of Frauds. As all acts necessary to compete the contract occurred in New York, the Court finds authority from that jurisdiction controls. However, Plaintiff does cite Rooney v. Tyson, 674 N.Y.S.2d 616 (N Y 1998), arguing that an oral contract between a boxer and trainer, for the trainer to train the boxer "for as long as he fights professionally," is analogous to this case. There, the court found that this time-frame was a definite duration. See id. This Court does not agree that Rooney is factually similar to the present case. Rooney did not discuss an alleged promise of lifetime employment or the Statute of Frauds; alternatively, the case focused on the duration of the agreement. In fact, the Rooney court made it clear that the case was not meant to overturn the body of authority in New York that holds that oral contracts for lifetime employment are violative of the Statute of Frauds.
II FRAUDULENT INDUCEMENT CLAIM
To determine the choice of law with regard to the fraudulent inducement claims, courts in Florida look to § 145 of the Restatement (Second) of Conflict of Laws. Simply put, Courts apply the test that the law of the state with the most significant relationship to the alleged fraudulent conduct will apply. Section 145 states:
(1) The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in § 6.
(2) Contacts to be taken into account in applying the principles of § 6 to determine the law applicable to an issue include:
(1) the place where the injury occurred,
(2) the place where the conduct causing the injury occurred,
(3) the domicile, residence, nationality, place of incorporation and place of the business of the parties, and
(4) the place where the relationship, if any, between the parties is centered.
Restatement (Second) of Conflict of Laws § 145.
In the case of a fraud claim which arises out of a failure to perform under a contract, or the failure to perform some future act, such a claim will not be sustained in the absence of some additional collateral fraud.
Defendant correctly relies on Vanderburgh v. Porter Sheet Metal, Inc., 86 A.D.2d 688, 446 N.Y.S.2d 523, 525 (3d Dept. 1982), which holds that "failure to perform promises of future acts is a breach of contract, not fraud." Defendant also correctly cites to Orix Credit Alliance, Inc. v. R.E. Hable Co., 256 A.D.2d 114, 682 N.Y.S.2d 160, 161 (1st Dept. 1998), where the court explains "Thus, a viable claim of fraud concerning a contract must allege misrepresentation of present facts (rather than merely of future intent) that were collateral to the contract and which induced the allegedly defrauded party to enter into the contract."
Simply put, Plaintiff would have to provide evidence of misrepresentation of present facts to proceed further with this false inducement claim. In the absence of such present facts, the false inducement claim properly fails. The misrepresentation of present facts did not occur, as Plaintiff can only rely upon more general promises of what might happen in the future from Grecco. The conduct of Grecco does not constitute fraudulent inducement.
Plaintiff attempts to transform a breach of contract claim into something more sinister. Plaintiff claims that Grecco enticed her to transfer to Tampa, when he knew that she would shortly be terminated. As Grecco is deceased, and the record is devoid of any evidence which tends to support the premise that Grecco misrepresented present facts, the Court concludes that the fraudulent inducement claim fails. Accordingly, it is
ORDERED that the Refiled Motion for Summary Judgment is granted. The Clerk of Court shall enter a final judgment in favor of Defendant.