Professional Documents
Culture Documents
Hodgkins v. New England Telephon, 1st Cir. (1996)
Hodgkins v. New England Telephon, 1st Cir. (1996)
____________________
No. 95-1818
Plaintiff - Appellant,
v.
Defendant - Appellee.
____________________
ERRATA SHEET
The
as follows:
Page
No. 95-1818
Plaintiff - Appellant,
v.
Defendant - Appellee.
____________________
____________________
Before
_____________________
____________________
May 7, 1996
____________________
Petruccelli
___________
Plaintiff-appellant William J.
Hodgkins
("Hodgkins")
former
appellee
New
because
his
England Telephone
employer,
and Telegraph
defendant-
Company ("NET"),
cost-saving
program.
The
judgment on
quantum
sued
idea
he
submitted in
district court
its
employee
meruit,
equitable
estoppel,
unjust
suggestion
for summary
breach of contract,
enrichment,
and
negligent
misrepresentation.
court's decision.
Hodgkins
appeals
the
district
BACKGROUND
BACKGROUND
__________
Because
favor
of the defendant,
favorable to
we recite the
facts in
benefit of
Work" ("the
ideas
produce
that
According
to
savings
or
NET's "Suggester's
increased
Guide,"
profits
reviewed by
for
NET.
Hodgkins
before he submitted his idea, the IAW program "rewards the people
who come up with ideas the company uses by paying the originators
implementation--up
to a
limit
maximum
of $5,000) of the
of $50,000."
The IAW
program
of 15 percent (minimum of
$75 and
or profits for
-2-
one
year
on
so-called
"tangible ideas,"
and
"Special
Merit
the
idea in its
IAW
tangible
According to an
an initial award
will be re-
determine
reduce
the
cost
multisubscribers
April 20,
of
such
changing
telephone
as dormitories
and
service
nursing
that would
for
certain
homes.
On
Hodgkins conducted his own study, and based on his own managerial
expertise, concluded that the idea would save NET money, and that
therefore NET would implement the idea, evaluate it under the IAW
program,
savings.
and
grant
Based
him fifteen
on his
percent
own knowledge
of
the first
of NET's
year's
operations and
Hodgkins
signing
submitted
a submission
his idea
form in
which he
to
the
IAW program
agreed to abide
by
by the
53 ("GAP 53").
sole, exclusive,
-3-
structure,
operation
and administration
. .
. .
e)
To
determine
the
method
for
f)
To determine the
granted.
g)
To determine
the person
entitled to
h) To
the
determine the
extent, if any,
application, implementation,
of an idea.
of
or use
The
Company
concerning
the terms,
that "[t]he
policy, structure,
administration of the
discretion
Company
of
the
decisions of the
and
are
operation or
final,
binding,
and
conclusive."
In August
company
provisioning."
As a result, he
September 1990.
suggester
percent
savings."
Tangible
Award
of 15
of
its
estimated
no determination of
for a Special
Merit
Expecting to
receive the
his idea,
In September 1992,
-4-
had
awarded him
$17,500 for
his idea.1
Hodgkins
told DuBois
that
evaluation
form
back
to
the
IAW
low.
program
manager
for
re-
evaluation.
report,
NET could
with Hodgkins'
not quantify
idea because
savings associated
exclusively
produced the
and a
same
conclusion.
task of
NET's evaluation
measuring savings
had been
reports indicated
at the
that the
rendered impossible by
the
As
a result,
NET has
any money
beyond
the
receive the
$5,000
Initial Award.
total amount
retirement have
Because
he expected, his
Hodgkins did
not
financial plans
for
to draw prematurely
theories
of
breach
of
contract,
quantum
and negligent
meruit,
additional
____________________
unjust
misrepresentation,
$45,000
On
-5-
which NET had agreed to pay on any IAW program award amount.
The
STANDARD OF REVIEW
STANDARD OF REVIEW
__________________
We review a district
de novo,
__ ____
nonmovant,
Hodgkins.
in the light
most favorable
to the
Cir. 1996); Coyne v. Taber Partners I, 53 F.3d 454, 457 (1st Cir.
_____
________________
1995).
Summary
pleadings,
judgment is
affidavits,
issue as to
appropriate when,
and depositions,
1995);
an
To
is
evidence
to support
the
non-moving party's
1990)).
(quoting Rogers
______
jury to
no genuine
absence of
position."
v. Fair,
____
is
the
Cir. 1995).
is
"there
based upon
reasonable
Id.
___
at
DISCUSSION
DISCUSSION
__________
On appeal, Hodgkins
sufficed
formed
an enforceable
contract,
-6-
and whether
NET breached
it.
Alternatively,
Hodgkins
in
the
absence
claims that he
unjust
enrichment or
claims
under
estoppel.
of
enforceable
a trial on
meruit.
estoppel
contract,
a theory of
Hodgkins also
equitable
Finally, Hodgkins
that a factfinder
an
is entitled to
quantum
theories
of
and
advances
promissory
evidence requires
negligently misrepresented
I.
I.
Breach of Contract
Breach of Contract
part
court
states
also
found that
that "[a]ll
the provision
ideas
which result
of
the IAW
in
The district
program that
Initial Awards
for
tangible ideas
Award" was
shall receive
"clearly enforceable."
found crucial
"the
consideration for a
sole,
determine
exclusive,
the
administration of
and
terms,
However, the
district court
complete discretion
policy,
the Program."
Special Merit
structure,
and
NET had
right
operation
to
and
pointed to
the IAW program Submission Form, which along with allocating such
discretion
the
method for
evaluating
be
granted."
As
ideas which
are submitted"
result,
the
district
court
and "to
award to
found
an
On
appeal, Hodgkins
argues
that the
IAW program
is
-7-
submission and implementing his idea, NET was bound to pay him if
it was successful.
there was
Under this
material fact
contract.
discretion
was
so
broad
as to
been too
was
that NET
and
encompass
its
actions,
district court
such
to
Hodgkins formed
an
agreement that
remained
complete discretion"
authority "to
any award to
latitude
be granted."
this provision
According to the
afforded NET
was sufficiently
wide to
Therefore,
Hodgkins
must
contends that
be erroneous.
According to
the district
court's analysis
generous to
idea, since NET had the unbridled discretion to vary the contract
at will.
-8-
(Me.
1987)
(noting
that
"[e]very
contract
requires
'consideration' to
either
his performance
In
district
Moores
______
(stating
considering
court
and the
v. Greenberg,
_________
that "[w]here
this
argument,
parties that
834 F.2d
Maine
1105, 1107
the parties
we
agree
with
law applies.
n.2 (1st
agree what
the
See
___
Cir. 1987)
substantive law
the
paramount
construction
of
principle
contracts
in
is
the
to
give
from
the
language
under
of
the
which
it was
intention must be
made
gathered
914,
919
(Me. 1983),
455 A.2d
v.
The
district
court's
reading
submitted
by
Hodgkins
clearly
reserves
of
the
written
calculation
and
determination of
not argue
awards to
that he was
not aware
Hodgkins does
of these provisions.
In
the
-9-
with the
its
repeated evaluations
of Hodgkins'
ideas, falls
within the
However,
as to
question
lingers
regarding
See Corthell,
___ ________
Hodgkins'
so "unlimited"
167 A. at
81 (noting
indefinite
an agreement
compensated
recognition,"
In Corthell, 167
________
A. at 81,
executed
for
"all
In that
with
his employer
future
whereby
inventions"
with
he would
be
"reasonable
employer
"at
all
discretion to the
Id.
___
employer, the
employer's promise
valid.
times."
Id. at
___
was not
82.
Despite
illusory and
Stating that
intended,
and not
technically," and
be
the reservation
the
held that
that the
contract
of
the
contract was
"was to
be
also emphasizing
that the
should
-10-
for "reasonable
Id. (finding
___
a valid
also concluding
Citing
program
agreement did
not
include any
agreement
void.
Comm'n,
______
reserved excessive
We do not agree.
449 A.2d
1116,
mention of
"reasonable
discretion
See Brooking v.
___ ________
1118 (Me.
1982)
for NET
program
and was
thus
(noting that
it
was
"highly unlikely"
that an
have been
reasonable
and failing
to note any
provision requiring
A. at 81).
emphasis based on
We cannot
Corthell.
________
See Towne v. Larson, 51 A.2d 51, 53 (Me. 1947) (noting that while
___ _____
______
"it
is true
enable
the
liability
that a
court to
of the
rather than to
as to render
contract must
determine its
parties . .
be sufficiently
meaning
. [t]he court
and fix
(discussing Corthell).
________
if that result
the legal
looks to substance
it unenforceable
definite to
a contract so
can be
avoided")
As
a result, we must
the agreement.
ascertain
1295-96.
mere wording of
Viewing the
-11-
general
purpose
of the
IAW
program
agreement appears
fairly
straightforward.
program
An employee
is intended
to
suggestion plan
reward ideas
employee participation in
and
such as
the IAW
promote more
active
See Fish
___ ____
Ford Motor Co., 534 N.E.2d 911, 913 (Ohio Ct. App. 1987).
_______________
v.
These
harder
and generate
time, the
clauses in
possible improvements.
Id.
___
At
the same
and the
proposal
Id.
___
is the
Among
quickly
those interests
resolve
instances
where
ability of the
the
employer to
suggestion involved
may
no
genuine issue of
proposition
illusory.
that,
under
Maine
the
unenforceable
IAW program,
by
assuming, arguendo,
________
grant
NET's
promise
constitutes an
Given
of
promise
was
unfettered
was not
not
rendered
discretion.
Even
his employment
discretion.
NET's
that
law,
surrounding
program
an award if
its
employees
when one
which NET
policies of
of them
it wished to,
generally
received an
did not
NET's promise
at its total
informing
award, the
allow it to
its
context in
refuse to
pay
-12-
awards
arbitrarily at
awards,
then the
incentives
to
IAW program
employees
improvements depended,
awards.2
In
provision
alone
its discretion.
sum,
does
to
in the
If
future would
suggest
and still
NET refused
not provide
improvements.
depend, on current
the lack
of
not
render
an
to pay
Future
payment of
explicit "reasonableness"
the
IAW
program
contract
unenforceable, and
district
court's
conclusion,
especially
in
the
absence
of
the
Maine Law Court would conclude that the IAW program constituted a
precise
contractual
consider
that
NET
faced,
however,
we
must
to Hodgkins.
question
duty
determining the
This is
certainly a disputed
issue of fact;
the
Taken, in
Hodgkins' favor, as true, this statement could not create any new
obligation on the
"past
part of
consideration"
____________________
and thus
insufficient
submitted idea
to
support a
was
new
2
and
Perhaps
publicize smaller
Hodgkins
sufficient
has
but still
presented
for
his
refused to pay
no
significant awards.
evidence
summary
higher awards
of
such
judgment burden.
However,
NET
While
to any material
judgment as a
fact and []
party
"may
not rest
upon
the
policy
summary
issue as
is entitled to
56(c); Coll v. PB
____
__
mere allegations
or
-13-
trial," Fed. R.
contract
or a modification.
1992)
(stating that
contract");
"[p]ast
consideration does
1317 (Mass.
not support
must
be bargained
purported
promise
for
. . .
consideration must
is executed,
promise");
[t]o
valid,
therefore,
not have
been delivered
given
without reference
that is,
4 Richard A. Lord,
be
Williston on Contracts
______________________
the
before a
to the
8:9, at
However,
we
conclude
that
whether
the
agreement
contained
an implicit
faith, accurate
obligation
evaluation of
which
jury could
infer
of reasonable
the idea's
efforts,
good
worth, or other
such
that
NET did
obligations when it
later claimed
Initial Award.
not
live
that Hodgkins'
up to
its
idea did
not
Having allegedly
tendered a
its
subsequent
breached its
the breach
court's
refusal to
as a
of
grant
proceedings in
contract
of
claim,
summary
accord with
contractual
duty
we must
judgment,
and
this opinion.
special award
As a result, on
reverse
the
remand
We leave
district
for
it to
which arose
under Maine
further
law pursuant
the
precise
to the
parties' agreement.
-14-
II.
II.
quantum meruit
theories.
describes recovery
for the
Under Maine
value of
when
fairness
services
or
materials
provided
under
an
recovery for
implied
contract."
Aladdin Elec. Assoc. v. Town of Old Orchard Beach, 645 A.2d 1142,
____________________
_________________________
1145 (Me. 1994); see A.F.A.B., Inc. v. Town of Old Orchard Beach,
___ ______________
_________________________
We
court's
finding
Hodgkins.
render
have
already
of an
discussed
enforceable
and
upheld
agreement
the district
between NET
and
the contract
inoperative,
of the Track,
_____________
654 A.2d
at 1296
Hodgkins
is foreclosed
(contract between
from
See Top
___ ___
the parties
forecloses unjust
Farmington,
__________
forecloses a
forth no such
104
enrichment
A.
521,
claim); Prest
_____
524 (1918)
evidence, we
v.
(valid
Inhabitants of
_______________
express
Because Hodgkins
contract
has put
district court
that
III.
III.
estoppel
and promissory
estoppel.
Under Maine
law, equitable
-15-
on what is untrue."
misunderstanding
estoppel").
promise
action or
person
binding
will
support
promisor should
forbearance on
and
not
which does
the part
induce
if injustice can be
such
application
which the
in reliance
of
equitable
reasonably expect
of the promisee
action
avoided only by
to induce
or a
third
or forbearance
is
enforcement of the
promise."
Martin
______
1050 (Me.
1986).
Hodgkins
program
contends
encouraged the
representations
to
that, taken
submission
employees,
as
of ideas
including
whole, the
and made
Hodgkins,
IAW
specific
about
the
produced financial
results.
Hodgkins argues
NET
from asserting
Hodgkins
thereby
in good
to
rights of
faith relied
change
his position
contract against
Citing
upon NET's
for
the
Hodgkins, since
conduct and
worse.
Martin, 511
______
A.2d at
was led
See,
___
e.g.,
____
A.2d 455,
1050 (Me.
1986),
The
because
it
district court
concluded
that
found
this argument
unconvincing
since
the
IAW
various
program
-16-
as
unreasonable
for Hodgkins
to
conclude
that such
publications
promised him
that
an award.
Hodgkins
employee
Furthermore, the
could not
have
newsletter of January
submitted
a winning
reasonably
3, 1991,
idea, since:
district court
(1)
relied
on
the
found
NET
listing him
as having
Hodgkins knew
that the
implemented, let
reference to
to an
and (3)
Hodgkins clearly
rules
and
"Initial
Awards."
meant an Initial
publications
Awards
use
for tangible
to a "Tangible
the term
ideas,"
"tangible"
but
Award" for
IAW program
to
describe
not "Special
Merit
On appeal,
court's
question
promise
existed
was
projecting
would
as
to
reasonable,
the district
whether Hodgkins'
since
he
had
reliance
used
his
on
NET's
experience
realize
from implementing
his
idea.
program publications
Second,
Hodgkins
in isolation, NET's
We
nonetheless.
find
the
district
court's
analysis
convincing
-17-
his
assessment
equitable
of
likely
savings
estoppel
theory
Hodgkins
reasonably relied
reasonably
have
argument that
simply
does
or that NET
expected
to
his
induce Hodgkins'
to the
existed as
crux
idea,
was required
made statements
factual question
not respond
from
an
show
he
to
which it
should
actions.
to his
of the
under
The
estimates
district court's
analysis:
Hodgkins'
an
issue of
triable fact,
that allegation
With respect to
by itself
does not
jury.
under equitable
estoppel, we
facts
may
Hodgkins
holistic approach.
competent
motion,
510
evidence
cannot
be referring
Because
NET's conduct
determine what
to
by
his
additional
invocation of
to
surmount a
supported
summary
judgment
40 F.3d 505,
evidence in support of
714
specific
IAW
facts showing a
program
publications and
competent evidence
both estoppel
triable issue"), we
the
NET
newsletter compose
theories.
We
agree
with the
the
of conduct for
district
court's
-18-
discussion of this
estoppel
theory, Hodgkins
could not
that, under an
equitable
have reasonably
relied on
statements or conduct
reasonably
reliance.3
have
as evidenced
in these sources.
For
the
expected
to
induce
Hodgkins'
actions
in
____________________
Hodgkins' promissory
complaint.
equitable
the
Because
it
for
the
same
reasons
as
his
district
court
erred
in concluding
that
the
promissory
-19-
IV.
IV.
Maine
Negligent Misrepresentation
Negligent Misrepresentation
has adopted
the Restatement
(Second) of
Torts
as follows:
One who,
in the course
of his business,
which he has
interest, supplies
the
a pecuniary
loss caused
to them
by their
justifiable
reliance
information,
if
he
reasonable
care
obtaining
or
upon
fails
or
to
the
exercise
competence
communicating
in
the
information.
he justifiably relied in
court
was unconvinced
district
court's
estoppel arguments,
program
publications
by
this argument.
finding
misrepresentation claim
must
that
fail for
The district
We agree
Hodgkins'
the same
NET
newsletter, as
the
negligent
reason as
and the
with
his
in the IAW
well
as the
context
in
which they
were
alleged
reliance unreasonable.
read,
clearly rendered
Hodgkins'
DuBois,
had
already retired,
and
thus Hodgkins
cannot
claim.
claim to
Hodgkins
have
does not
-20-
point
to
evidence contradicting
NET's
statements
in the
IAW
program
publications
and
the
NET
newsletter
that
rendered
related
decisions.
Because
Hodgkins
must
show
justifiable
fact remains
to grant him a
trial under a
CONCLUSION
CONCLUSION
further proceedings.
further proceedings
affirmed in part,
affirmed in part
________________
and remanded
and remanded
________
for
for
-21-