(Super. Ct. No. 04AS00665)
The opinion of the court was delivered by: Nicholson , Acting P. J.
Monk v. Sacramento Metropolitan Fire Dist.
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
Plaintiff Gary Monk sued his former employer, defendant Sacramento Metropolitan Fire District (the District), after he entered into a settlement agreement and agreed to retire in exchange for the District terminating a disciplinary proceeding against him. In his suit, Monk alleged causes of action for retaliation in violation of Labor Code section 1102.5, wrongful discharge in violation of public policy, constructive discharge, and breach of an implied contract to terminate only for cause.
Following trial, two theories went to the jury: retaliation in violation of Labor Code section 1102.5, and constructive discharge. The jury found the District liable for retaliation and awarded Monk economic damages in the form of lost pension benefits of $574,191 and non-economic damages of $100,000. However, the jury also determined Monk had not been constructively discharged.
The District moved for a new trial, judgment notwithstanding the verdict, and to vacate the judgment. The trial court denied the new trial motion, but it granted in part the judgment notwithstanding the verdict and the motion to vacate as to the jury's award of $574,191 in economic damages. The court ruled Monk was not entitled to economic damages in the form of lost pension benefits because the jury determined he had not been constructively terminated.
Both Monk and the District appeal. Monk challenges the trial court's denying him economic damages because he was not constructively terminated. He claims the court's ruling is in error because either (1) substantial evidence supports a factual determination that the District actually terminated Monk; or (2) the jury's finding of no constructive discharge did not foreclose an award of damages based on the theory the District left Monk with no viable alternative but to accept the District's terms of termination.
The District challenges the verdict finding it committed retaliation in violation of Labor Code section 1102.5. It claims (1) there was insufficient evidence to sustain the jury's finding of retaliation; (2) claims for any damages due to retaliation arising from disciplinary proceedings against Monk, including the $100,000 awarded in non-economic damages, were barred under the statute of limitations and the settlement agreement; and (3) the court erred in admitting certain hearsay evidence.
We disagree with the arguments asserted by both parties and affirm the judgment in its entirety.
Monk claimed the District initiated a series of disciplinary actions against him in retaliation for his reporting a potential violation of law by District personnel to a government or law enforcement agency. The disciplinary actions culminated in his retiring from the District. In this case, Monk asserted the retaliation for his reporting violations of law by a government agency to a law enforcement agency violated Labor Code section 1102.5, and his retirement was a constructive discharge. Because both parties raise substantial evidence arguments on appeal, we describe the facts adduced at trial in depth.
Monk was a long-time member of the fire service. He began his career in 1978 as a firefighter, and later served as an inspector and primary fire investigator. In 1998, he became the supervising arson investigator for the Sacramento County Fire Protection District, a predecessor entity to the District. (For the sake of convenience, we refer to both entities as the District.) During his service, Monk received positive work evaluations. He was active in community service, and served a one-year term as the president of the Sacramento County Firefighters Association.
In 1998, Monk became the supervisor to Scott Lewis, an arson investigator. As a supervisor, Monk was responsible for assigning Lewis to investigate fires and for reviewing and approving Lewis's reports prior to sending them to the sheriff's department.
2. 2000 discipline proceedings against Scott Lewis
Monk worked under the direction of Fire Marshal Vernon Brown. Brown was part of the District's management structure. He reported directly to the fire chief. He would notify the fire chief of any problems dealing with employee performance, such as if the employee was filing false reports. In late 1999, Monk and Fire Marshal Brown met with Deputy District Attorney Richard Margarita to discuss some of Lewis's actions in the field. Margarita believed Lewis had behaved inappropriately on a number of occasions and was subjecting the District to potential liability.
At that meeting, Monk informed Margarita of an incident involving Lewis of which Margarita was not yet aware. On December 3, 1999, Lewis made a vehicle stop on U.S. 50. Lewis was not on duty at the time, but he was using a District van. Lewis arrested and handcuffed the driver, one Polly Johnson, and issued her a citation for misdemeanor reckless driving. However, Lewis made a false police report. He claimed a sheriff's deputy had arrested and cited Johnson, not him.
In a 10-page letter dated January 14, 2000, and addressed to Fire Marshal Brown, Margarita detailed a number of situations where Lewis had engaged in conduct he believed exposed the District to a significant risk of liability. One was the Polly Johnson incident where Lewis falsified a police report. Another incident involved another traffic stop. This time, Lewis held a person at gunpoint believing the suspect was involved in a felony. Lewis requested backup from the sheriff's department. Several sheriff's vehicles came with lights and sirens on. However, the suspect was the wrong person. Margarita knew Lewis had performed this vehicle stop even though Lewis had already been directed by Brown not to engage in vehicle stops.
Other incidents involved Lewis's investigation into an arson investigation known as the Sirsi incident. Lewis conducted a probation search on a storage locker used by John Sirsi. He asked Sirsi's girlfriend, a Ms. Webber, to identify the items he recovered, believing some of them to have been stolen. Lewis claimed Webber told him Sirsi had fled Sacramento to Idaho to avoid prosecution for insurance fraud.
Based on Lewis's report of Webber's statement, Margarita contacted the FBI to request they obtain a warrant and arrest Sirsi in Idaho. The FBI requested Lewis provide them with a declaration of the facts surrounding Webber's statement. Margarita instructed Lewis on at least three separate occasions to prepare the declaration, but he never did. When asked why, Lewis said he was too busy or going to school.
Margarita later learned, however, that Webber never told Lewis that Sirsi had fled to Idaho. This explained to Margarita why Lewis had not prepared the declaration.
Lewis had identified one Scott Gray as a suspect in the Sirsi incident, and had determined Gray had two warrants out for his arrest, one of which was a no-bail warrant. Lewis informed Margarita he was going to arrest Gray. Margarita advised Lewis to involve investigators from the district attorney's office, but Lewis said he did not have time to do that. Lewis went and met with Gray, but despite the no-bail warrant for Gray's arrest, Lewis did not arrest him. Instead, he performed another vehicle stop on a Ms. Sumner and without probable cause. Margarita claimed Lewis should have arrested Gray once he knew about the no-bail warrant.
Based on these incidents, Margarita concluded Lewis was a "liar" running "amuck" whose actions were unlawful and put others at risk of harm and the District at risk of liability. Margarita recommended to his superiors at the District Attorney's office that Lewis be prosecuted.
After Margarita sent his letter to Brown, Brown contacted him to discuss another falsified police report prepared by Lewis. Lewis participated in a search of a residence and seized some drugs. He reported he had destroyed the drugs, but the drugs subsequently reappeared. Margarita again expressed his concern about Lewis, and he recommended Lewis be terminated.
Brown shared Margarita's letter with interim Fire Chief Gary Costamagna and the District's human resources manager, Teresa Means. Means said she would take the lead on disciplining Lewis.
Following her investigation, Means disciplined Lewis by demoting him to a firefighter but staying the demotion. In the notifying letter dated February 7, 2000, Means stated the District had concluded Lewis's involvement with law enforcement incidents unrelated to arson investigations was excessive; there were a number of improprieties between ancillary reports and actual incident reports; and he failed to follow directions not to have any further involvement in law enforcement activities unrelated to arson. The District demoted Lewis to line firefighter, but stayed the demotion for 12 months on condition of good behavior.
By letter dated the next day, February 8, 2000, Means reinstated Lewis's authorization to carry a firearm, his peace officer status, and his regular arson inspector duties as of February 9, 2000, at 7:30 a.m. All equipment he had surrendered during the District's investigation, including his firearm, was to be reissued to him at that time.*fn1
3. 2000 discipline proceedings against Monk
Meanwhile, about a week and a half after Margarita sent his January 14 letter to Brown, Monk and Lewis were both working a fire called the Anderson truss fire. Monk had placed Lewis in charge of the fire, and Lewis had made assignments to various investigators from other fire departments that came to assist with the fire. Monk then saw Brown relieve Lewis of his duties. At that point, Monk took over as the incident commander on the fire. The other investigators asked Monk where Lewis had gone and who was in charge. Monk told them Lewis had been relieved of duty and he was assuming the role of incident commander.
Around this same time, Monk taught an arson investigation class at the sheriff's academy for reserve deputies. During a break, one of the students approached him and asked if there were any job openings with the District. Monk told the student there were none at that time. Monk also said, "We do have one individual who got in trouble for doing some things and who knows what will happen, but if you're interested, apply for the job." Monk did not provide the student with Lewis's name.
To Monk's surprise, on February 8, 2000, Lewis reported for work and showed Monk the February 8 letter written by Means reinstating Lewis as an arson investigator and all equipment he surrendered during the investigation to be returned to him, including his firearm. Monk knew nothing about this letter or its contents. Monk returned to Lewis a red light Monk had earlier removed from Lewis's vehicle. Monk had not taken Lewis's firearm from him, so he suggested Lewis wait until Monday when the fire marshal returned to speak with him about getting his gun. At some point that day, the acting fire marshal asked Monk if he had seen the February 8 letter and directed him to return Lewis's equipment to Lewis. Monk told the acting fire marshal he had returned the equipment he had taken from Lewis.
On February 25, 2000, Means suspended Monk immediately and placed him on paid administrative leave pending the outcome of the District's investigation and disciplinary action. Means also suspended Monk's peace officer status and took away his firearm. Means told him he was being suspended because he had spoken about the Lewis matter with persons outside the District at the Anderson truss fire and with cadets at the sheriff's academy.
Monk sent a written response to the suspension to Brown, with copies to Means and Costamagna. He did not deny the allegations, but he was not aware of any District policy or provision of the Memorandum of Understanding (MOU) between Monk's union and the District that stated his actions were inappropriate. He accused the District of violating its own policies. Means had filed a report of occurrence, which is an incident report form that is not to be used for personnel matters and is to be copied to all persons involved. Means had filed the inappropriate form and had not given him a copy. Also, District policy required a notice of proposed disciplinary action be given to the employee before suspending him. Monk did not receive a notice of proposed disciplinary action when he was suspended.
Monk also questioned the disproportionate action taken against him when compared with the action taken by the District against Lewis. Lewis had committed possible criminal acts, but he was allowed to continue working an administrative job while he was being investigated and was not suspended. Monk accused the District of acting based on impermissible motives, and he asked for a meeting with Brown, Means, and Costamagna.
Brown responded to Monk's letter on March 8, 2000, by simply telling Monk to direct all of his communications to Means.
On March 10, 2000, Means delivered to Monk a notice of proposed disciplinary action, informing Monk the District intended to demote him from supervising arson inspector to arson inspector. Means accused Monk of violating the MOU by committing "inexcusable discourteous treatment" and acting in a way that brought discredit to the District. The notice scheduled a Skelly hearing for March 20.*fn2
However, on March 24, 2000, Means issued Monk a second notice of proposed discipline. This notice amended the March 10 notice by accusing Monk of insubordination. The notice stated Monk had refused to reinstate Lewis to his arson investigator position and refused to return his equipment when Lewis furnished Monk with Means's letter of February 8 reinstating him and when the acting fire marshal directed Monk to reinstate Lewis and return his equipment. Means alleged Monk left work for the weekend without complying with the acting fire marshal's directive. The Skelly hearing was set for April 3.
Following the Skelly hearing on April 3, Chief Costamagna, who also served as the hearing officer, imposed the proposed discipline on Monk and demoted him to arson investigator for insubordination and for discussing Lewis's personnel matter with others.
Until he testified at trial, Costamagna did not know that Monk had imparted any information to the District Attorney's office about Lewis lying on a police report. The issue to Costamagna was a breach of duty by a supervisor. Regarding the insubordination, Costamagna was never told that Monk told Lewis when he came back to work that he did not know where Lewis's gun was and he would have to get it from the fire marshal. Means was the person advising Costamagna on Monk's disciplinary action.*fn3
A little more than three weeks after being demoted, Monk received a third notice of proposed discipline from Means. This notice, dated April 27, 2000, proposed terminating Monk from his employment with the District for allegedly engaging in outside employment while on duty for the District and where such employment could result in a conflict of interest. The notice alleged Monk, while on duty and in a District vehicle, went to the scene of an arson investigation and gave to the property manager a business card bearing the name of Pacific Rim Investigative Services and Monk's name. The investigation had already been assigned to Supervising Investigator Thomas McKinnon and was in progress. Monk went to the scene without direction from McKinnon and began interviewing witnesses. The notice claimed his presence was unnecessary and his tendering a business card suspect. A Skelly hearing was set for May 9, 2000.
When McKinnon saw Monk at the scene, Monk was not wearing any District gear. He did not have his badge or gun. He wore coveralls that are not worn by District personnel. McKinnon obtained a copy of Monk's private business card from the property manager. McKinnon also spoke with an insurance carrier representative. The representative stated she had hired Monk to do the investigation. When McKinnon told her Monk had just left the scene, she said Monk could not do the fire because it would be a conflict of interest.
Following the Skelly hearing, Monk was disciplined on May 12, 2000, by being demoted to a line firefighter instead of being terminated. Costamagna wrote that Monk's actions at a minimum were confusing to the property manager, and at most could be viewed as conducting business for the insurance carrier on District time. Costamagna made no finding that Monk's actions were intentional.
Costamagna ordered Monk to be recertified as a firefighter in less than three weeks. At the time, Monk was 47 years old and suffering from diabetes and hypertension. He had not been a firefighter for about 10 years. Monk thought the imposition of a short time frame to recertify was unfair, as new probationary firefighters are given one year to certify. Nevertheless, he successfully recertified within the allowed time.
Included in our record are letters from the insurance carrier representative and Pacific Rim Investigative Services addressed to Means acknowledging Monk worked part-time for Pacific Rim, that the carrier had contacted Monk in that capacity to inspect the fire, and that Monk had informed the carrier he could not do it because the fire was within the District's jurisdiction. However, he told the carrier he was going to inspect the site anyway and he would let her know what he saw.
At trial, Costamagna stated he was not aware of a letter indicating an insurance carrier had asked Monk to look at the scene and that Monk had responded he could not do the work due to a conflict of interest but he would view the scene and give the carrier a ...