Robert E. Johnson, Plaintiff, Appellant, v. Long Corporation of Puerto Rico, Trading As Long Construction Company of Puerto Rico, Defendant-appellee, 244 F.2d 284 (1st Cir. 1957)

Was sufficient evidence adduced at the trial to sustain the findings of fact and conclusions of law of the District Court?

That is the question presented on this appeal from the judgment of the District Court of Puerto Rico in favor of Long Corporation of Puerto Rico, trading as Long Construction Company of Puerto Rico ("Long") in an action against it by its former employee Robert E. Johnson for alleged breach of an employment contract.

The facts as found by the District Court may be summarized as follows: On or about October 21, 1947, Long employed Johnson as superintendent of sewer and water construction. Long at the time was engaged in large scale construction of low cost housing in Puerto Rico. The employment contract was reduced to writing December 29, 1947.¹  It contained, under the caption "Term of Employment" the following clause:

"This agreement shall remain in force so long as Long Construction Company of Puerto Rico is engaged in the construction of homes for Everlasting Development Corporation of Puerto Rico; subject, of course, to the right of L. D. Long [president of Long] in his sole discretion, to terminate the same for any act or omission deemed by him to be detrimental to the good and welfare of said business." (Emphasis supplied.)

On the afternoon of December 24, 1947, the office employees of Long held a Christmas party. Long was not present. He was at that time in Charleston, South Carolina, visiting his parents for the Christmas holiday. Johnson, who was at the party, "was considerably in liquor, and at one point came up to Frederick D' A. Carpenter, at that time Territorial Director of the Federal Housing Administration and told him that Long, President of the defendant corporation, was an `S.O.B.' and that Long did not know what he was doing."²  On still another occasion, at the same party, Johnson had an altercation with a fellow employee in the course of which he said "everyone there was a bastard; and that the organization was full of crap, that the people present were sons of bitches".³  Prior to this episode Johnson "had pinched the buttocks"⁴  of the wife of the man with whom he had the altercation.

Subsequent to this Christmas party, on December 27, 1947, Johnson wrote a letter to one Nutter, a prospective employee of Long, "which although jocular in tone reflected on the concept of morality prevailing in the defendant organization".⁵ 

On December 27th Johnson left Puerto Rico for Charleston, South Carolina, to confer with Long on company business. It was on that visit that the written contract was signed. Subsequently Johnson left for New York and Chicago on company business. Long on his return to Puerto Rico on January 5, 1948, learned of the Christmas party episode and instituted an investigation of Johnson's conduct. As a result of the investigation "Mr. Long decided that plaintiff's (Johnson's) actions were detrimental to the best interests of the company, and discharged him by cablegram on January 7, 1948."

On the findings stated the District Court concluded as a matter of law that Long "had adequate grounds in law for discharging" Johnson and entered judgment dismissing Johnson's action.

Johnson advances two contentions on this appeal: (1) while his conduct at the Christmas party "might not be considered exemplary" it nevertheless was not "detrimental to the good and welfare of the business"; (2) in any event, the conduct which led to his dismissal occurred prior to the signing of the contract of December 29th and therefore could not as a matter of law provide the basis of dismissal under its terms.

In reply, Long disputes these contentions and urges further that under the express terms of the contract the right to terminate Johnson's employment was left to Long's sole discretion and accordingly he could do so upon the occurrence of any act or omission which he might deem detrimental to his business. Otherwise stated, it is Long's view that the contract made him the "exclusive judge" as to what constituted an act or omission "detrimental to the good and welfare" of his business, and the only requirement was that he act in good faith.

It is unnecessary to consider this latter proposition because in our opinion Johnson's contentions are without merit and the record affords substantial basis for the District Court's determination that "Defendant (Long) had adequate grounds in law for discharging plaintiff (Johnson)."

Putting aside Johnson's rowdy conduct at the Christmas party, his drunkenness, his altercation with a fellow employee and the pinching incident, his statement to Carpenter, the Territorial Director of the Federal Housing Administration that Long "was an S.O.B." and that "Long did not know what he was doing" and his further statement to all and sundry at the party that Long's "organization was full of crap" constituted conduct "detrimental to the good and welfare" of Long's business. If more were needed, Johnson's letter to Nutter, could well be considered a "second-helping" on that score.

As to Johnson's contention that the signed contract washed-out, as it were, his prior misconduct, we hold it is utterly without basis. It is clear from the record that the contract of December 29th merely constituted a reduction to writing of the oral contract of October 21st.

Judgment will be entered affirming the judgment of the District Court.