Stehm v. Nordam Group, Inc.

2007 OK CIV APP 94, 170 P.3d 546, 2007 Okla. Civ. App. LEXIS 66, 2007 WL 2830194
CourtCourt of Civil Appeals of Oklahoma
DecidedMay 18, 2007
Docket104,000
StatusPublished

This text of 2007 OK CIV APP 94 (Stehm v. Nordam Group, Inc.) is published on Counsel Stack Legal Research, covering Court of Civil Appeals of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stehm v. Nordam Group, Inc., 2007 OK CIV APP 94, 170 P.3d 546, 2007 Okla. Civ. App. LEXIS 66, 2007 WL 2830194 (Okla. Ct. App. 2007).

Opinion

ROBERT DICK BELL, Judge.

T1 Plaintiff/ Appellant, Christopher Stehm, a former employee of Defendant/ Appellee, The Nordam Group, an aerospace company (Employer), brought this action against Employer for fraudulent misrepresentétion and concealment of client information during the hiring/recruiting process. 1 The trial court sustained Employer's motion for summary judgment finding no genuine issues of material fact existed and therefore, Employer was entitled to judgment as a matter of law. We reverse and remand for further proceedings.

T2 Appellant was employed by Gardner Denver. In the summer of 2002, Employer's upper management began recruiting Appellant to become controller of Employer's Interior & Structures Division (Division). During the recruitment process, Appellant was interviewed by Richard Armstrong, the Vice President of the Division. Appellant testified *548 that when he asked Armstrong about Employer's financial stability and future in the airline industry, Armstrong assured him the Division was financially secure due in part to the substantial revenue generated under a contract with Gulf Stream aircraft. Under this contract, the Division built cabinets for Gulf Stream's G200 luxury private jet aircraft. Appellant testified he relied upon these assurances to terminate his existing employment and accept Employer's employment offer.

T3 Within a few days after beginning his new employment, Appellant learned Gulf Stream had previously terminated its contract with Employer. He also learned Armstrong was aware of this information during the recruitment process Appellant remained employed for eight months until he was terminated by Employer on March 20, 2008.

14 In 2004, Appellant filed the instant tort action against Employer. Employer denied any wrongdoing and affirmatively claimed Appellant failed to mitigate damages and waived his fraud claim. After the completion of discovery, Employer sought summary judgment. Employer's motion alleged it was entitled to judgment as a matter of law because (1) Appellant failed to produce evi dence that he was fraudulently induced to accept employment with Employer; (2) Oklahoma law does not impose a duty upon an employer to disclose sensitive client information to a prospective employee; (8) Appellant had no expectation of continued employment because he was an at-will employee; (4) Appellant failed to produce evidence of harm or damages; and (5) Appellant waived his right to pursue this action by remaining employed for eight months after discovery of the @l-leged fraud.

[5 In response, Appellant attached eviden-tiary materials revealing disputed issues of material fact concerning each of the elements of actual fraud and fraudulent concealment. He also cited various authorities in support of his assertion that Employer had the duty to disclose to its potential employee the known information that a key contractual relationship affecting the prospective employee's job had been terminated and Employer's non-disclosure of that material information was a breach of that duty. With respect to Employer's affirmative defenses, Appellant attached case law supporting his claim that continued employment after discovery of the fraud did not constitute waiver of fraud because he performed his duties without seeking additional consideration. Appellant further alleged his continued performance mitigated his damages.

16 Without discussing any reasons therefore, the trial court sustained Employer's motion for summary judgment. Appellant appeals from that order. This matter stands submitted without appellate briefs on the trial court record. See Rule 18, Rules for District Courts, 12 0.8. Supp.2002, Ch. 2, App. 1, and Rule 1.36, Oklahoma Supreme Court Rules, 12 0.8. Supp.2008, Ch. 15, App.

> {7 This Court's standard of review of a trial court's grant of summary judgment is de novo. Hoyt v. Paul R. Miller, M.D., Inc., 1996 OK 80, ¶ 2, 921 P.2d 350, 351-52. Summary judgment is proper when the evidentia-ry materials "establish that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law." Shelley v. Kiwash Elec. Coop., Inc., 1996 OK 44, ¶ 15, 914 P.2d 669, 674. When this Court reviews the trial court's grant of summary judgment, all inferences and conclusions drawn from the evidence must be viewed in the light most favorable to the party opposing the motion. Id. When the evidence in the present case is viewed under this standard, we find genuine issues of material fact preclude summary judgment in Employer's favor.

18 Appellant first contends the trial court erred in determining that Oklahoma Law does not recognize an at-will employee's right to bring an action against an employer for fraudulent concealment and/or misrepresentation during the hiring process. Neither party cited nor did independent research uncover Oklahoma case law specifically recognizing the instant cause of action. However, other states have recognized this cause of action. See Berger v. Security Pacific Information Systems, Inc., 795 P.2d 1380 (Colo.App.1990); Redies v. Nationwide Mut. Ins. Co., 711 F.Supp. 570, 572 (D.Colo.1989)("This *549 Court concludes that plaintiffs claims for fraud, false representation, non-disclosure or concealment, and negligent misrepresentation may be maintained based on representations regarding future conditions of employment."); Meade v. Cedarapids, Inc., 164 F.3d 1218 (9th Cir.1999)(Under Oregon law, an employee's at-will status did not defeat the employee's claim that the employer misrepresented its financial situation and future growth to induce the employee to work for employer.) Wildes v. Pens Unlimited Co., 389 A.2d 837 (Me.1978); Stewart v. Jackson & Nash, 976 F.2d 86 (2nd Cir.1992)(recognizing a claim under New York law for fraudulent inducement in hiring); Palmer v. Beverly Enters., 823 F.2d 1105, 1113 (7th Cir.1987) Lazar v. Superior Court, 12 Cal.4th 631, 49 Cal.Rptr.2d 377, 909 P.2d 981 (Cal.1996)(holding a claim for fraudulent inducement to accept employment was actionable where the employer's misrepresentations were made prior to hiring, when the employer lacked coercive power over the prospective employee and the prospective employee was free to decline the offered position.)

19 Generally, these cases recognized a tort claim against an employer for misrepresentations made to induce acceptance of employment by focusing on the employees' cireumstances preceding the at-will employment relationships and the inducements and decisions leading to employment. See also Richard P. Perna, Deceitful Employers: Common Law Fraud as a Mechanism to Remedy Intentional Employer Misrepresentation in Hiring, 41 Willamette L.Rev. 283 (2005).

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Related

Stewart v. Jackson & Nash
976 F.2d 86 (Second Circuit, 1992)
Tice v. Tice
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Shelley v. Kiwash Electric Cooperative, Inc.
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Silk v. Phillips Petroleum Co.
1988 OK 93 (Supreme Court of Oklahoma, 1988)
Lazar v. Superior Court
909 P.2d 981 (California Supreme Court, 1996)
Varn v. Maloney
1973 OK 133 (Supreme Court of Oklahoma, 1973)
Eckley v. Colorado Real Estate Commission
752 P.2d 68 (Supreme Court of Colorado, 1988)
Redies v. Nationwide Mutual Insurance
711 F. Supp. 570 (D. Colorado, 1989)
Wildes v. Pens Unlimited Co.
389 A.2d 837 (Supreme Judicial Court of Maine, 1978)
Berger v. Security Pacific Information Systems, Inc.
795 P.2d 1380 (Colorado Court of Appeals, 1990)
Steiger v. Commerce Acceptance of Oklahoma City, Inc.
1969 OK 78 (Supreme Court of Oklahoma, 1969)
Deardorf v. Rosenbusch
1949 OK 117 (Supreme Court of Oklahoma, 1949)
Hoyt v. Paul R. Miller, M.D., Inc.
1996 OK 80 (Supreme Court of Oklahoma, 1996)
Meade v. Cedarapids, Inc.
164 F.3d 1218 (Ninth Circuit, 1999)

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2007 OK CIV APP 94, 170 P.3d 546, 2007 Okla. Civ. App. LEXIS 66, 2007 WL 2830194, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stehm-v-nordam-group-inc-oklacivapp-2007.