Vajda v. Arthur Andersen & Co.

624 N.E.2d 1343, 253 Ill. App. 3d 345, 191 Ill. Dec. 965
CourtAppellate Court of Illinois
DecidedSeptember 7, 1993
Docket1-92-1237
StatusPublished
Cited by25 cases

This text of 624 N.E.2d 1343 (Vajda v. Arthur Andersen & Co.) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vajda v. Arthur Andersen & Co., 624 N.E.2d 1343, 253 Ill. App. 3d 345, 191 Ill. Dec. 965 (Ill. Ct. App. 1993).

Opinion

JUSTICE HARTMAN

delivered the opinion of the court:

Plaintiff, Albert Vajda, a former manager of defendant, Arthur Andersen & Company (Andersen), sought damages both from Andersen for terminating his employment without just cause or first following the company’s discipline policy, and from James A. Carty, an Andersen partner, for embarking on a course of conduct allegedly designed to have plaintiff wrongfully discharged. The circuit court granted defendants’ joint motion for summary judgment on all four counts of plaintiff’s fourth amended complaint.

Plaintiff appeals, seeking reversal and remandment for a jury trial, raising as issues whether (1) genuine issues of material fact with respect to employee termination procedures exist which preclude entry of summary judgment against him; (2) he possessed enforceable contractual rights against Andersen by virtue of written and oral promises made to him, as expressed in Andersen employee handbook documents and by Andersen supervisory staff, respectively; (3) the doctrine of promissory estoppel applies to these circumstances; (4) defendant Carty possessed a qualified privilege; and (5) Carty caused plaintiff’s wrongful termination.

The facts essential to the disposition of this appeal were drawn from documentary evidence and deposition testimony submitted to the circuit court for consideration in the summary judgment proceedings.

Plaintiff was employed by Andersen for almost 21 years. He served as a manager in Andersen’s “Information Systems Services Division” (ISS) during the last 12 years of his employment. During the course of plaintiff’s employment with Andersen, the company issued a “Personal Reference Binder” (Manual) to each partner and employee of the company. The Manual set forth general employment policies and also stated:

“In issuing this binder, our prime purpose is to provide quick answers to your day-to-day questions on how the Firm operates and how you fit into the operation. On some matters it is the basic document that sets forth Firm policy; on other matters it summarizes Firm policy included in other publications, such as Office Management Bulletins, Firm Accounting Releases, Ethical Standards and Highlights of Worldwide Code of Conduct (Subject File AA2870, Items 1 and 60).”

In a section entitled “Personnel Policies” relating to employment and promotion, the Manual provided:

“The partners are committed to a policy and practice of deciding matters relating to employment, including compensation, advancement, transfer and promotion, on the basis of qualifications and merit alone.”

The Manual also provided that “[Qull-time regular employment is the usual arrangement in which a person is hired to work our normal business hours *** for a time period of indefinite duration.”

There was evidence that in 1973, when plaintiff joined Andersen’s “Information System Services Division” (ISS), he was told by the personnel office director that no employees would be dismissed without three warnings. In the late 1970s and early 1980s, plaintiff attended meetings where ISS personnel manager George Koch discussed the three-warning policy. He was instructed that there would be serious consequences if there was no just or good cause to terminate an employee, and then only after the three-warning policy was followed.

Plaintiff also received a copy of written three-warning procedures, contained in a document known as the “Supervisor’s Seminar Personnel Policy Procedures” (Procedures), which remained unaltered between 1980 and 1987. The Procedures provide that the supervisor must give a verbal warning describing the poor performance or misconduct. After the verbal warning, the supervisor must document the warning discussion in a “greensheet” and submit it to the personnel office. The subject of the warning would be reviewed within two to three months. If there was no change in performance, a second warning would be given, again greensheet documented. Thereafter, if the conduct continued, the employee would receive a final warning, which must be documented in a greensheet as soon as possible. If the conduct continued, the instructions required the supervisor to call the appropriate superiors for approval to terminate. An employee would never be summarily fired.

The Procedures were distributed by Andersen at supervisors’ seminars on a regular basis. In addition to being distributed to supervisory personnel in written form, the three-warning policy was made known verbally to all ISS employees through new employees’ orientation, supervisors’ seminars and at various meetings; it was common knowledge among them, as attested to by other ISS managers, Michael Kennedy and Robb Gay. The three-warning policy was also openly discussed by supervisors when they returned from their training seminars. Philip Keirn, an Andersen partner and head of ISS, specifically admitted that Andersen had a policy of requiring good cause for discharge.

The Manual, which provided that all employment decisions were to be based on merit and qualifications, as supplemented by written procedures therein described, together with the oral and written representations of a three-warning policy, were construed by plaintiff as having created a contract of employment, which provided that employees would not be discharged without just cause and without appropriate warnings.

ISS was assigned the task of developing or improving several of Andersen’s data processing systems. Because ISS did not have sufficient staff or expertise to complete these projects by itself, Andersen assigned some of its “Management Information Consulting Division” (MICD) professionals to each of the projects.

Carty became the MICD partner assigned to certain ISS projects in 1982. He and ISS partner Keim shared responsibility for some of these projects. Carty, however, was responsible for overall management of some projects, including general superintendence over ISS personnel and direct supervision over the MICD personnel. Carty evaluated plaintiff and participated with him in project steering committee and sponsor meetings. Plaintiff did not report to Carty, however, but to another Andersen employee, Mark Rosenthal, who reported to Keirn.

In the five-year period preceding plaintiff’s termination, the annual written performance evaluations prepared by Andersen partners and plaintiff’s superiors revealed strong, steady, and consistently above-average performance. Beginning in 1983, however, Carty considered some of plaintiff’s behavior disruptive, because it interfered with Carty’s authority over MICD staffing. At one meeting, plaintiff told Carty that ISS did not have the luxury as “you do in MICD of having a manager on these jobs.” Carty understood this to be a putdown and a negative attitude. When an MICD professional named Keith Mollenkamp was assigned to a project called CLEAR, plaintiff, without informing Carty, called Mollenkamp’s home office in Houston to inquire into his background and discuss his qualifications. Plaintiff openly criticized Mollenkamp’s qualifications for the project. Plaintiff informed an MICD manager that expenses incurred by MICD personnel assigned to the CLEAR project were inappropriate.

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Bluebook (online)
624 N.E.2d 1343, 253 Ill. App. 3d 345, 191 Ill. Dec. 965, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vajda-v-arthur-andersen-co-illappct-1993.